================================================================================
AMENDED AND RESTATED
REVOLVING CREDIT, TERM LOAN
AND
SECURITY AGREEMENT
================================================================================
PNC BANK, NATIONAL ASSOCIATION
(AS LENDER AND AS AGENT)
PNC CAPITAL MARKETS, INC.
(AS LEAD ARRANGER AND SOLE BOOK-RUNNER)
================================================================================
WITH
================================================================================
AIR METHODS CORPORATION,
ROCKY MOUNTAIN HOLDINGS, L.L.C.,
MERCY AIR SERVICE, INC.
AND
LIFENET, INC.
(BORROWERS)
================================================================================
MAY 9, 2005
================================================================================
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TABLE OF CONTENTS
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I DEFINITIONS. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
1.1.
Accounting
Terms.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
1.2.
General
Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
1.3.
Uniform Commercial Code Terms. . .
. . . . . . . . . . . . . . . . . . . . 24
1.4.
Certain
Matters of Construction. . . . . . . . . . . . . . . . . . . . . .
24
II ADVANCES, PAYMENTS.. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
2.1.
Revolving
Advances.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
2.2.
Procedure
for Revolving Advances Borrowing.. . . . . . . . . . . . . . . .
26
2.3.
Disbursement of Advance Proceeds.. . . . . . . . . . . . . . . . .
. . . . 28
2.4.
Term
Loans.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 29
2.5.
Maximum
Revolving Advances.. . . . . . . . . . . . . . . . . . . . . . . .
29
2.6.
Repayment
of Advances. . . . . . . . . . . . . . . . . . . . . . . . . . .
29
2.7.
Repayment
of Excess Advances.. . . . . . . . . . . . . . . . . . . . . . .
30
2.8.
Statement
of Account.. . . . . . . . . . . . . . . . . . . . . . . . . . .
30
2.9.
Letters of
Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
30
2.10.
Issuance of
Letters of Credit. . . . . . . . . . . . . . . . . . . . . . .
31
2.11.
Requirements For
Issuance of Letters of Credit.. . . . . . . . . . . . . .
31
2.12.
Disbursements,
Reimbursement.. . . . . . . . . . . . . . . . . . . . . . .
32
2.13.
Repayment of
Participation Advances. . . . . . . . . . . . . . . . . . . .
33
2.14.
Documentation. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34
2.15.
Determination to
Honor Drawing Request.. . . . . . . . . . . . . . . . . .
34
2.16.
Nature of
Participation and Reimbursement Obligations. . . . . . . . . . .
34
2.17.
Indemnity. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
36
2.18.
Liability for
Acts and Omissions.. . . . . . . . . . . . . . . . . . . . .
36
2.19.
Additional
Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . .
37
2.20.
Manner of
Borrowing and Payment. . . . . . . . . . . . . . . . . . . . . .
37
2.21.
Mandatory
Prepayments. . . . . . . . . . . . . . . . . . . . . . . . . . .
39
2.22.
Use of Proceeds.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40
2.23.
Defaulting
Lender. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40
III INTEREST AND FEES. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 41
3.1.
Interest..
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
41
3.2.
Letter of
Credit Fees. . . . . . . . . . . . . . . . . . . . . . . . . . .
42
3.3.
Facility
Fee.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
43
3.4.
Fee
Letter.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 43
3.5.
Computation of Interest and Fees.. . . . . . . . . . . . . . . . .
. . . . 43
3.6.
Maximum
Charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
43
3.7.
Increased
Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
43
3.8.
Basis For
Determining Interest Rate Inadequate or Unfair.. . . . . . . . .
44
3.9.
Capital
Adequacy.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
45
3.10.
Gross Up for
Taxes.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
45
3.11.
Withholding Tax
Exemption. . . . . . . . . . . . . . . . . . . . . . . . .
46
IV COLLATERAL: GENERAL
TERMS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
46
4.1.
Security
Interest in the Collateral. . . . . . . . . . . . . . . . . . . .
46
i
<PAGE>
4.2.
Perfection
of Security Interest. . . . . . . . . . . . . . . . . . . . . .
47
4.3.
Disposition of Collateral. . . . . . . . . . . . . . . . . . . . .
. . . . 47
4.4.
Preservation of Collateral.. . . . . . . . . . . . . . . . . . . .
. . . . 48
4.5.
Ownership
of Collateral. . . . . . . . . . . . . . . . . . . . . . . . . .
48
4.6.
Defense of
Agent's and Lenders' Interests. . . . . . . . . . . . . . . . .
49
4.7.
Books and
Records. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50
4.8.
Financial
Disclosure.. . . . . . . . . . . . . . . . . . . . . . . . . . .
50
4.9.
Compliance
with Laws.. . . . . . . . . . . . . . . . . . . . . . . . . . .
50
4.10.
Inspection of
Premises.. . . . . . . . . . . . . . . . . . . . . . . . . .
50
4.11.
Insurance. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 50
4.12.
Failure to Pay
Insurance.. . . . . . . . . . . . . . . . . . . . . . . . .
52
4.13.
Payment of
Taxes.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
52
4.14.
Payment of
Leasehold Obligations.. . . . . . . . . . . . . . . . . . . . .
53
4.15.
Receivables. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53
4.16.
Inventory. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
55
4.17.
Maintenance of
Equipment.. . . . . . . . . . . . . . . . . . . . . . . . .
56
4.18.
Exculpation of
Liability.. . . . . . . . . . . . . . . . . . . . . . . . .
56
4.19.
Environmental
Matters. . . . . . . . . . . . . . . . . . . . . . . . . . .
56
4.20.
Financing
Statements.. . . . . . . . . . . . . . . . . . . . . . . . . . .
58
V REPRESENTATIONS
AND WARRANTIES.. . . . . . . . . . . . . . . . . . . . . . . . . .
58
5.1.
Authority.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
58
5.2.
Formation
and Qualification. . . . . . . . . . . . . . . . . . . . . . . .
59
5.3.
Survival
of Representations and Warranties.. . . . . . . . . . . . . . . .
59
5.4.
Tax
Returns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 59
5.5.
Financial
Statements.. . . . . . . . . . . . . . . . . . . . . . . . . . .
59
5.6.
Entity
Names.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
60
5.7.
O.S.H.A.
and Environmental Compliance. . . . . . . . . . . . . . . . . . .
60
5.8.
Solvency;
No Litigation, Violation, Indebtedness or Default. . . . . . . .
60
5.9.
Patents,
Trademarks, Copyrights and Licenses.. . . . . . . . . . . . . . .
62
5.10.
Licenses and
Permits.. . . . . . . . . . . . . . . . . . . . . . . . . . .
62
5.11.
Default of
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . .
62
5.12.
No Default.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
62
5.13.
No Burdensome
Restrictions.. . . . . . . . . . . . . . . . . . . . . . . .
62
5.14.
No Labor
Disputes. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.15.
Margin
Regulations.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.16.
Investment
Company Act.. . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.17.
Disclosure.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.18.
Delivery of
Acquisition Agreement. . . . . . . . . . . . . . . . . . . . .
63
5.19.
Swaps. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.20.
Conflicting
Agreements.. . . . . . . . . . . . . . . . . . . . . . . . . .
63
5.21.
Application of
Certain Laws and Regulations. . . . . . . . . . . . . . . .
64
5.22.
Business and
Property of Borrowers.. . . . . . . . . . . . . . . . . . . .
64
5.23.
Section 20
Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . .
64
5.24.
Real Property. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64
5.25.
Anti-Terrorism
Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . .
64
5.26.
Trading with the
Enemy.. . . . . . . . . . . . . . . . . . . . . . . . . .
65
ii
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VI AFFIRMATIVE COVENANTS.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
65
6.1.
Payment of Fees. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 65
6.2.
Conduct of
Business and Maintenance of Existence and Assets. . . . . . . .
65
6.3.
Violations.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 65
6.4.
Government
Receivables.. . . . . . . . . . . . . . . . . . . . . . . . . .
66
6.5.
Financial
Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . .
66
6.6.
Execution
of Supplemental Instruments. . . . . . . . . . . . . . . . . . .
66
6.7.
Payment of
Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . .
66
6.8.
Standards
of Financial Statements. . . . . . . . . . . . . . . . . . . . .
66
6.9.
Exercise
of Rights.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
67
VII NEGATIVE COVENANTS.. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 67
7.1.
Merger,
Consolidation, Acquisition and Sale of Assets. . . . . . . . . . .
67
7.2.
Creation of Liens. . . . . . . . .
. . . . . . . . . . . . . . . . . . . . 68
7.3.
Guarantees.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 68
7.4.
Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 68
7.5.
Loans. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
68
7.6.
"Intentionally Omitted". . . . . . . . . . . . . . . . . . . . . .
. . . . 68
7.7.
Dividends.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
68
7.8.
Indebtedness; Unfinanced Capital Expenditures; Personal Property
Leases. . 69
7.9.
Nature of
Business.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
69
7.10.
Transactions
with Affiliates.. . . . . . . . . . . . . . . . . . . . . . .
69
7.11.
Leases.. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
70
7.12.
Subsidiaries.. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
70
7.13.
Fiscal Year and
Accounting Changes.. . . . . . . . . . . . . . . . . . . .
70
7.14.
Pledge of
Credit.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
70
7.15.
Amendment of
Articles of Incorporation, By-Laws, Certificate of Formation,
Operating Agreement. . . . . . . . . . . . . . . . . . . . . . . .
. . . . 70
7.16.
Compliance with
ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . .
70
7.17.
Prepayment of
Indebtedness.. . . . . . . . . . . . . . . . . . . . . . . .
71
7.18.
Anti-Terrorism
Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . .
71
7.19.
Membership/Partnership Interests.. . . . . . . . . . . . . . . . .
. . . . 71
7.20.
Trading with the
Enemy Act.. . . . . . . . . . . . . . . . . . . . . . . .
71
7.21.
Other
Agreements.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. 71
VIII CONDITIONS PRECEDENT.. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . 72
8.1.
Conditions
to Initial Advances.. . . . . . . . . . . . . . . . . . . . . .
72
8.2.
Conditions
to Each Advance.. . . . . . . . . . . . . . . . . . . . . . . .
75
IX INFORMATION AS TO
BORROWERS. . . . . . . . . . . . . . . . . . . . . . . . . . . .
75
9.1.
Disclosure
of Material Matters.. . . . . . . . . . . . . . . . . . . . . .
75
9.2.
Schedules.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
75
9.3.
Environmental Reports. . . . . . . . . . . . . . . . . . . . . . .
. . . . 76
9.4.
Litigation.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . 76
9.5.
Material
Occurrences.. . . . . . . . . . . . . . . . . . . . . . . . . . .
76
9.6.
Government
Receivables.. . . . . . . . . . . . . . . . . . . . . . . . . .
76
9.7.
Annual
Financial Statements. . . . . . . . . . . . . . . . . . . . . . . .
76
9.8.
Quarterly
Financial Statements.. . . . . . . . . . . . . . . . . . . . . .
77
iii
<PAGE>
9.9.
Monthly
Financial Statements.. . . . . . . . . . . . . . . . . . . . . . .
77
9.10.
Other Reports. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
77
9.11.
Additional
Information.. . . . . . . . . . . . . . . . . . . . . . . . . .
77
9.12.
Projected
Operating Budget.. . . . . . . . . . . . . . . . . . . . . . . .
78
9.13.
Variances From
Operating Budget. . . . . . . . . . . . . . . . . . . . . .
78
9.14.
Notice of Suits,
Adverse Events. . . . . . . . . . . . . . . . . . . . . .
78
9.15.
ERISA Notices
and Requests.. . . . . . . . . . . . . . . . . . . . . . . .
78
9.16.
Additional
Documents.. . . . . . . . . . . . . . . . . . . . . . . . . . .
79
X EVENTS OF
DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . 79
10.1.
Nonpayment.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
79
10.2.
Breach of
Representation.. . . . . . . . . . . . . . . . . . . . . . . . .
79
10.3.
Financial
Information. . . . . . . . . . . . . . . . . . . . . . . . . . .
79
10.4.
Judicial
Actions.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
79
10.5.
Noncompliance. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
79
10.6.
Judgments. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
80
10.7.
Bankruptcy.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
80
10.8.
Inability to
Pay.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
80
10.9.
Third Party
Bankruptcy.. . . . . . . . . . . . . . . . . . . . . . . . . .
80
10.10.
Material Adverse
Effect. . . . . . . . . . . . . . . . . . . . . . . . . .
80
10.11.
Lien Priority. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 80
10.12.
Intentionally Omitted.
. . . . . . . . . . . . . . . . . . . . . . . . . . 80
10.13.
Cross Default. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 80
10.14.
Breach of Guaranty.. .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.15.
Change of Ownership. .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.16.
Invalidity.. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.17.
Licenses.. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.18.
Seizures.. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.19.
Operations.. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
10.20.
Pension Plans. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 81
XI LENDERS' RIGHTS AND
REMEDIES AFTER DEFAULT.. . . . . . . . . . . . . . . . . . . .
82
11.1.
Rights and
Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . .
82
11.2.
Agent's
Discretion.. . . . . . . . . . . . . . . . . . . . . . . . . . . .
83
11.3.
Setoff.. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
83
11.4.
Rights and
Remedies not Exclusive. . . . . . . . . . . . . . . . . . . . .
84
11.5.
Allocation of
Payments After Event of Default. . . . . . . . . . . . . . .
84
XII WAIVERS AND JUDICIAL
PROCEEDINGS.. . . . . . . . . . . . . . . . . . . . . . . . .
85
12.1.
Waiver of
Notice.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85
12.2.
Delay. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85
12.3.
Jury Waiver. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85
XIII EFFECTIVE DATE AND TERMINATION.. .
. . . . . . . . . . . . . . . . . . . . . . . . 85
13.1.
Term.. . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85
13.2.
Termination. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85
XIV REGARDING AGENT. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.1.
Appointment. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
86
iv
<PAGE>
14.2.
Nature of
Duties.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
86
14.3.
Lack of Reliance
on Agent and Resignation. . . . . . . . . . . . . . . . .
87
14.4.
Certain Rights
of Agent. . . . . . . . . . . . . . . . . . . . . . . . . .
87
14.5.
Reliance.. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88
14.6.
Notice of
Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88
14.7.
Indemnification.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88
14.8.
Agent in its
Individual Capacity.. . . . . . . . . . . . . . . . . . . . .
88
14.9.
Delivery of
Documents. . . . . . . . . . . . . . . . . . . . . . . . . . .
88
14.10.
Borrowers' Undertaking
to Agent. . . . . . . . . . . . . . . . . . . . . . 89
14.11.
No Reliance on Agent's
Customer Identification Program.. . . . . . . . . . 89
14.12.
Other Agreements.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 89
XV BORROWING AGENCY.. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
89
15.1.
Borrowing Agency
Provisions. . . . . . . . . . . . . . . . . . . . . . . .
89
15.2.
Waiver of
Subrogation. . . . . . . . . . . . . . . . . . . . . . . . . . .
90
XVI MISCELLANEOUS. . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 90
16.1.
Governing Law. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
90
16.2.
Entire
Understanding.. . . . . . . . . . . . . . . . . . . . . . . . . . .
91
16.3.
Successors and
Assigns; Participations; New Lenders. . . . . . . . . . . .
93
16.4.
Application of
Payments. . . . . . . . . . . . . . . . . . . . . . . . . .
94
16.5.
Indemnity. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
95
16.6.
Notice.. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
95
16.7.
Survival.. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
97
16.8.
Severability.. .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
97
16.9.
Expenses.. . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
97
16.10.
Injunctive Relief. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 98
16.11.
Consequential Damages.
. . . . . . . . . . . . . . . . . . . . . . . . . . 98
16.12.
Captions.. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 98
16.13.
Counterparts;
Facsimile Signatures.. . . . . . . . . . . . . . . . . . . .
98
16.14.
Construction.. . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 98
16.15.
Confidentiality;
Sharing Information.. . . . . . . . . . . . . . . . . . .
98
16.16.
Publicity. . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . 99
16.17.
Certifications From
Banks and Participants; US PATRIOT Act.. . . . . . . . 99
</TABLE>
v
<PAGE>
AMENDED AND RESTATED
REVOLVING CREDIT, TERM LOAN
AND
SECURITY AGREEMENT
Amended and
Restated Revolving Credit, Term Loan and Security Agreement
dated as of May 9, 2005 among AIR METHODS
CORPORATION, a corporation organized
under the laws of the State of Delaware
("AMC"), ROCKY MOUNTAIN HOLDINGS,
L.L.C., a limited liability company formed
under the laws of the State of
Delaware ("RMH"), MERCY AIR SERVICE, INC.,
a corporation organized under the
laws of the State of California ("Mercy"),
LIFENET, INC. (formerly known as ARCH
AIR MEDICAL SERVICE, INC.), a corporation
formed under the laws of the State of
Missouri ("LifeNet") (AMC, RMH, Mercy and
LifeNet, each a "Borrower" and
collectively "Borrowers"), the financial
institutions which are now or which
hereafter become a party hereto
(collectively, the "Lenders" and individually a
"Lender"), PNC BANK, NATIONAL ASSOCIATION
("PNC"), as agent for Lenders (PNC, in
such capacity, the "Agent") and PNC CAPITAL
MARKETS, INC. ("PNCCM"), as Lead
Arranger and Sole Book-Runner.
BACKGROUND
Borrowers,
Lenders and Agent are party to a Revolving Credit and Security
Agreement dated as of October 16, 2002 (as
amended, including by Amendment No. 1
to Revolving Credit and Security Agreement
dated as of March 28, 2005, the
"Original Loan Agreement") pursuant to
which Agent and Lenders provide Borrowers
with certain financial accommodations.
In connection
with the early repayment by Borrowers of the Subordinated
Note (as defined in the Original Loan
Agreement), each of the Borrowers has
requested that Lenders and Agent increase
the aggregate credit facility from
$35,000,000 to $55,000,000, to consist of a
Maximum Revolving Advance Amount of
$35,000,000, a new Term Loan A in the
amount of up to $12,000,000 and a new Term
Loan B in the amount of up to $8,000,000.
Upon the terms and
conditions set
forth in this Agreement, Lenders have so
agreed to provide such increased credit
facilities.
Borrowers,
Lenders and Agent now wish to amend and restate the Original
Loan Agreement on the terms and conditions
set forth in this Agreement.
A. AMENDMENT AND
RESTATEMENT
-------------------------
As of the date of this Agreement, the terms, conditions,
covenants,
agreements, representations and warranties
contained in the Original Loan
Agreement shall be deemed amended and
restated in their entirety as follows and
the Original Loan Agreement shall be
consolidated with and into and superseded
by this Agreement; provided, however, that
nothing contained in this Agreement
-------- -------
shall impair, limit or affect the Liens
heretofore granted, pledged and/or
assigned to Agent and Lenders as security
for Borrowers' Obligations to Lender
under the Original Loan Agreement.
IN CONSIDERATION
of the mutual covenants and undertakings herein contained,
<PAGE>
Borrowers, Lenders and Agent hereby agree
as follows:
I DEFINITIONS.
1.1.
Accounting Terms. As
used in this Agreement, the Other Documents
----------------
or any certificate, report or other
document made or delivered pursuant to this
Agreement, accounting terms not defined in
Section 1.2 or elsewhere in this
Agreement and accounting terms partly
defined in Section 1.2 to the extent not
defined, shall have the respective meanings
given to them under GAAP; provided,
however, whenever such accounting terms are
used for the purposes of determining
compliance with financial covenants in this
Agreement, such accounting terms
shall be defined in accordance with GAAP as
applied in preparation of the
audited financial statements of Borrowers
for the fiscal year ended December 31,
2004 or upon any amendment of such
financial covenants, GAAP as in effect on the
date of the last such amendment.
1.2.
General Terms. For
purposes of this Agreement the following terms
-------------
shall have the following meanings:
"Accountants"
shall have the meaning set forth in Section 9.7 hereof.
-----------
"Acquisition
Agreement" shall mean the Membership Interest Purchase
---------------------
Agreement including all exhibits and
schedules thereto dated June 6, 2002 among
-
RMH, Sellers and AMC, as buyer.
"Advance Rates"
shall have the meaning set forth in Section 2.1(a) hereof.
-------------
"Advances" shall
mean and include the Revolving Advances, the Letters of
--------
Credit, and the Term Loans.
"Affiliate" of
any Person shall mean (a) any Person which, directly or
---------
indirectly, is in control of, is controlled
by, or is under common control with
such Person, or (b) any Person who is a
director, managing member, general
partner or officer (i) of such Person, (ii)
of any Subsidiary of such Person or
(iii) of any Person described in clause (a)
above. For purposes of
this
definition, control of a Person shall mean
the power, direct or indirect, (x) to
vote 20% or more of the Equity Interests
having ordinary voting power for the
election of directors of such Person or
other Persons performing similar
functions for any such Person, or (y) to
direct or cause the direction of the
management and policies of such Person
whether by ownership of Equity Interests,
contract or otherwise.
"Agent" shall
have the meaning set forth in the preamble to this Agreement
-----
and shall include its successors and
assigns.
"Agreement"
shall mean this Amended and Restated Revolving Credit, Term
---------
Loan and Security Agreement, as the same
may be further amended, restated,
supplemented or otherwise modified from
time to time.
"Aircraft" shall
mean (i) an engine-driven fixed-wing aircraft heavier than
--------
air, that is supported in flight by the
dynamic reaction of the air against its
wings or (ii) a rotorcraft that, for its
horizontal motion, depends principally
on its engine-driven rotors. Aircraft shall include any
2
<PAGE>
item which is incorporated in, attached to
or specifically acquired by any
Borrower to be used only in connection with
a specific Aircraft.
"Aircraft
Collateral Value" shall mean the value ascribed by Agent to
each
-------------------------
of the Unencumbered Aircraft as of the
Closing Date for purposes of determining
the amounts to be loaned hereunder against
such Unencumbered Aircraft, as set
forth on Exhibit D, as reduced, from time
to time, by each such Aircraft's
---------
allocable share of principal payments made
by any Borrower with respect to Term
Loan A, in accordance with the formulation
set forth on Exhibit D.
---------
"Aircraft
Indebtedness" shall mean Indebtedness incurred to finance the
---------------------
purchase, lease or maintenance of
Aircraft.
"Alternate Base
Rate" shall mean, for any day, a rate per annum equal to
-------------------
the higher of (i) the Base Rate in effect
on such day and (ii) the Federal Funds
Open Rate in effect on such day plus 1/2 of
1%.
"Anti-Terrorism
Laws" shall mean any Applicable Laws relating to terrorism
-------------------
or money laundering, including Executive
Order No. 13224, the USA PATRIOT Act,
the Applicable Laws comprising or
implementing the Bank Secrecy Act, and the
Applicable Laws administered by the United
States Treasury Department's Office
of Foreign Asset Control (as any of the
foregoing Applicable Laws may from time
to time be amended, renewed, extended, or
replaced).
"Applicable Law"
shall mean all laws, rules and regulations applicable to
--------------
the Person, conduct, transaction, covenant,
Other Document or contract in
question, including all applicable common
law and equitable principles; all
provisions of all applicable state, federal
and foreign constitutions, statutes,
rules, regulations and orders of any
Governmental Body, and all orders,
judgments and decrees of all courts and
arbitrators.
"Applicable
Margin" shall mean initially, (x) with respect to Eurodollar
-----------------
Loans consisting of Revolving Advances,
2.25%, and (y) with respect to
Eurodollar Loans consisting of Term Loan A,
2.75%. Commencing with
the receipt
and review by Agent of Borrowers' quarterly
financial statements pursuant to
Section 9.8 hereof for the fiscal quarter
ending September 30, 2005, and upon
receipt and review by Agent of Borrower's
quarterly financial statements at the
end of each fiscal quarter thereafter, the
Applicable Margin shall be adjusted
effective five (5) Business Days following
receipt of such statements to the
percentages set forth below, based upon the
ratio of Senior Debt to EBITDA at
the end of such fiscal quarter:
<TABLE>
<CAPTION>
Senior Debt to EBITDA Ratio
Revolving Term
Loan A
----------------------------------------------------- ---------- ------------
Advances
----------
<S>
<C>
<C>
Less than 2.00 :1.00
1.75%
2.25%
Greater than or equal to 2.00 but less than
2.50:1.00
2.00%
2.50%
Greater than or equal to 2.50 but less than
3.50:1.00
2.25%
2.75%
Greater than or equal to 3.50 but less than
4.00:1.00
2.50%
3.00%
Greater than or equal to 4.00:1.00
3.00%
3.25%
</TABLE>
3
<PAGE>
If any financial
statements referred to above are not delivered within the
required time periods then, until so
delivered, the Senior Debt to EBITDA Ratio
as at the end of the fiscal period that
would have been covered thereby shall,
for the purpose of this definition, be
deemed to be greater than 4.00 to 1.0 and
the Applicable Margin based upon such
Senior Debt to EBITDA Ratio shall become
effective as of the due date of such
delinquent financial statements. No
reduction in the Applicable Margin shall
occur if an Event of Default has
occurred and is continuing at the time such
reduction is scheduled to occur.
"Authority"
shall have the meaning set forth in Section 4.19(d).
---------
"Base Rate"
shall mean the base commercial lending rate of PNC as publicly
---------
announced to be in effect from time to
time, such rate to be adjusted
automatically, without notice, on the
effective date of any change in such rate.
This rate of interest is determined from
time to time by PNC as a means of
pricing some loans to its customers and is
neither tied to any external rate of
interest or index nor does it necessarily
reflect the lowest rate of interest
actually charged by PNC to any particular
class or category of customers of PNC.
"Blocked
Accounts" shall have the meaning set forth in Section 4.15(h).
----------------
"Blocked Account
Bank" shall have the meaning set forth in Section 4.15(h).
--------------------
"Blocked Person"
shall have the meaning set forth in Section 5.25(b)
--------------
hereof.
"Borrower" or
"Borrowers" shall have the meaning set forth in the preamble
--------
---------
to this Agreement and shall extend to all
permitted successors and assigns of
such Persons.
"Borrowers on a
Consolidated Basis" shall mean the consolidation in
---------------------------------
accordance with GAAP of the accounts or
other items of AMC and its Subsidiaries.
-
"Borrowers'
Account" shall have the meaning set forth in Section 2.8.
------------------
"Borrowing
Agent" shall mean AMC.
---------------
"Borrowing Base
Certificate" shall mean a certificate duly executed by an
--------------------------
officer of Borrowing Agent appropriately
completed and in substantially the form
of Exhibit A hereto.
---------
"Business Day"
shall mean any day other than Saturday or Sunday or a legal
------------
holiday on which commercial banks are
authorized or required by law to be closed
for business in East Brunswick, New Jersey
and, if the applicable Business Day
relates to any Eurodollar Rate Loans, such
day must also be a day on which
dealings are carried on in the London
interbank market.
4
<PAGE>
"Capital
Expenditures" shall mean expenditures made or liabilities
incurred
--------------------
for the acquisition of any fixed assets or
improvements, replacements,
substitutions or additions thereto which
have a useful life of more than one
year, including the total principal portion
of Capitalized Lease Obligations,
which, in accordance with GAAP, would be
classified as capital expenditures.
"Capital Lease"
of any Person shall mean any lease of any property (whether
-------------
real, personal or mixed) by that Person as
lessee which, in conformity with
GAAP, is, or is required to be, accounted
for as a capital lease on the balance
sheet of that Person, together with any
renewals of such leases (or entry into
new leases) on substantially similar
terms.
"Capitalized
Lease Obligations" of any Person shall mean all obligations
-----------------------------
under Capital Leases of such Person or any
of its Subsidiaries in each case
taken at the amount thereof recorded as a
liability on the balance sheet in
accordance with GAAP.
"CERCLA" shall
mean the Comprehensive Environmental Response, Compensation
------
and Liability Act of 1980, as amended, 42
U.S.C. Sec.Sec.9601 et seq.
"Change of
Control" shall mean the occurrence of an event, or series of
-----------------
events, which has led to (i) any "person"
or "group" (as such terms are used in
sections 13(d) and 14(d) of the Exchange
Act) becoming the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under
the Exchange Act), directly or
indirectly, of capital stock of AMC
representing 40% or more, on a fully diluted
basis, of the economic or voting interest
of the then outstanding capital stock
of AMC, (ii) during any period commencing
on or after the Closing Date,
individuals who at the beginning of such
period were directors of AMC, together
with such directors as have been duly
approved by individuals who were directors
at the beginning of such period (or by
directors duly approved by them), ceasing
for any reason to constitute a majority of
the board of directors of AMC, (iii)
any Person or Persons who are not
"citizens" of the United States (as such term
is defined in 14 Code of Federal
Regulations Section 204.2, as the same may be
amended) owning or controlling 20% or more,
in the aggregate, of the voting
capital stock of AMC or (iv) AMC or any of
its Affiliates that holds any air
carrier certificate(s) issued by the U.S.
Department of Transportation ceasing
to be a "citizen" of the United States (as
such term is defined in 14 Code of
Federal Regulations Section 204.2, as the
same may be amended.
"Charges" shall
mean all taxes, charges, fees, imposts, levies or other
-------
assessments, including all net income,
gross income, gross receipts, sales, use,
ad valorem, value added, transfer,
franchise, profits, inventory, capital stock,
license, withholding, payroll, employment,
social security, unemployment,
excise, severance, stamp, occupation and
property taxes, custom duties, fees,
assessments, liens, claims and charges of
any kind whatsoever, together with any
interest and any penalties, additions to
tax or additional amounts, imposed by
any taxing or other authority, domestic or
foreign (including the Pension
Benefit Guaranty Corporation or any
environmental agency or superfund), upon the
Collateral, any Borrower or any of its
Affiliates.
"Closing Date"
shall mean May 9, 2005 or such other date as may be agreed
------------
to by the parties hereto.
"Code" shall
mean the Internal Revenue Code of 1986, as the same may be
----
amended or
5
<PAGE>
supplemented from time to time, and any
successor statute of similar import, and
the rules and regulations thereunder, as
from time to time in effect.
"Collateral"
shall mean and include:
----------
(a)
all Receivables;
(b)
all Equipment (including Unencumbered Aircraft, but excluding
all other Aircraft);
(c)
all General Intangibles;
(d)
all Inventory;
(e)
all Investment Property;
(f)
all of each Borrower's right, title and interest in and to,
whether now owned or hereafter acquired and
wherever located, (i) its respective
goods and other property including, but not
limited to, all merchandise returned
or rejected by Customers, relating to or
securing any of the Receivables; (ii)
all of each Borrower's rights as a
consignor, a consignee, an unpaid vendor,
mechanic, artisan, or other lienor,
including stoppage in transit, setoff,
detinue, replevin, reclamation and
repurchase; (iii) all additional amounts due
to any Borrower from any Customer relating
to the Receivables; (iv) other
property, including warranty claims,
relating to any goods securing the
Obligations; (v) all of each Borrower's
contract rights, rights of payment which
have been earned under a contract right,
instruments (including promissory
notes), documents, chattel paper (including
electronic chattel paper), warehouse
receipts, deposit accounts, letters of
credit and money; (vi) all commercial
tort claims (whether now existing or
hereafter arising); (vii) if and when
obtained by any Borrower, all real and
personal property of third parties in
which such Borrower has been granted a lien
or security interest as security for
the payment or enforcement of Receivables;
(viii) all letter of credit rights
(whether or not the respective letter of
credit is evidenced by a writing); (ix)
all supporting obligations; and (x) any
other goods, personal property or real
property now owned or hereafter acquired in
which any Borrower has expressly
granted a security interest or may in the
future grant a security interest to
Agent hereunder, or in any amendment or
supplement hereto or thereto, or under
any other agreement between Agent and any
Borrower;
(g)
all of each Borrower's ledger sheets, ledger cards, files,
correspondence, records, books of account,
business papers, computers, computer
software (owned by any Borrower or in which
it has an interest), computer
programs, tapes, disks and documents
relating to (a), (b), (c), (d), (e) or (f)
of this Paragraph; and
(h)
all proceeds and products of (a), (b), (c), (d), (e), (f) and
(g) in whatever form, including, but not
limited to: cash,
deposit accounts
(whether or not comprised solely of
proceeds), certificates of deposit,
insurance proceeds (including hazard, flood
and credit insurance), negotiable
instruments and other instruments for the
payment of money, chattel paper,
security agreements, documents, eminent
domain proceeds, condemnation proceeds
and tort claim proceeds.
6
<PAGE>
------
provided, however, the Collateral shall not
include any rights or interests of
-------- -------
Borrowers under any licenses, leases or
other contracts if and to the extent
that (a) the terms of the agreement or
agreements creating or evidencing such
rights or interests prohibit such grant and
(b) the term prohibiting such grant
is effective as a matter of law and has not
been waived or the consent of the
necessary party to the grant to Agent has
not been obtained; provided, further,
-------- -------
(i) if any such prohibition is subsequently
lifted, terminated or is otherwise
no longer effective as a matter of law or
is waived or the consent of the
necessary party is obtained, a security
interest therein in favor of Agent shall
automatically arise hereunder without any
further action on the part of
Borrowers or Agent and (ii) nothing
contained herein shall be deemed to limit,
impair or otherwise affect Agent's security
interest in any rights or interests
of Borrowers in or to monies due or to
become due under any such agreement.
"Commitment
Percentage" of any Lender shall mean the percentage set forth
---------------------
below such Lender's name on the signature
page hereof as same may be adjusted
upon any assignment by a Lender pursuant to
Section 16.3(b) hereof.
"Commitment
Transfer Supplement" shall mean a document in the form of
------------------------------
Exhibit 16.3 hereto, properly completed and
otherwise in form and substance
------------
satisfactory to Agent by which the
Purchasing Lender purchases and assumes a
portion of the obligation of Lenders to
make Advances under this Agreement.
"Compliance
Certificate" shall mean a compliance certificate to be signed
----------------------
by the Chief Financial Officer or
Controller of Borrowing Agent, in the form of
Exhibit B which shall state that, based on
an examination sufficient to permit
---------
such officer to make an informed statement,
no Default or Event of Default
exists, or if such is not the case,
specifying such Default or Event of Default,
its nature, when it occurred, whether it is
continuing and the steps being taken
by Borrowers with respect to such default
and, such certificate shall have
appended thereto calculations which set
forth Borrowers' compliance with the
requirements or restrictions imposed by
Sections 6.5, 7.8 and 7.11.
"Consents" shall
mean all filings and all licenses, permits, consents,
--------
approvals, authorizations, qualifications
and orders of Governmental Bodies and
other third parties, domestic or foreign,
necessary to carry on any Borrower's
business or necessary (including to avoid a
conflict or breach under any
agreement, instrument, other document,
license, permit or other authorization)
for the execution, delivery or performance
of this Agreement or the Other
Documents, including any Consents required
under all applicable federal, state
or other Applicable Law.
"Contract Rate"
shall mean, as applicable, the Revolving Interest Rate, the
-------------
Term Loan A Rate or the Term Loan B
Rate.
"Controlled
Group" shall mean, at any time, each Borrower and all members
----------------
of a controlled group of corporations and
all trades or businesses (whether or
not incorporated) under common control and
all other entities which, together
with any Borrower, are treated as a single
employer under Section 414 of the
Code.
"Customer" shall
mean and include the account debtor with respect to any
--------
Receivable
7
<PAGE>
and/or the prospective purchaser of goods,
services or both with respect to any
contract or contract right, and/or any
party who enters into or proposes to
enter into any contract or other
arrangement with any Borrower, pursuant to
which such Borrower is to deliver any
personal property or perform any services.
"Default" shall
mean an event, circumstance or condition which, with the
-------
giving of notice or passage of time or
both, would constitute an Event of
Default.
"Default Rate"
shall have the meaning set forth in Section 3.1 hereof.
------------
"Defaulting
Lender" shall have the meaning set forth in Section 2.23(a)
-----------------
hereof.
"Depository
Accounts" shall have the meaning set forth in Section 4.15(h)
-------------------
hereof.
"Documents"
shall have the meaning set forth in Section 8.1(c) hereof.
---------
"Dollar" and the
sign "$" shall mean lawful money of the United States of
------
-
America.
"Domestic Rate
Loan" shall mean any Advance that bears interest based upon
------------------
the Alternate Base Rate.
"Drawing Date"
shall have the meaning set forth in Section 2.12(b) hereof.
------------
"Earnings Before
Interest and Taxes" shall mean for any period the sum of
----------------------------------
(i) net income (or loss) of Borrowers on a
Consolidated Basis for such period
(excluding extraordinary gains and losses),
plus (ii) all interest expense of
Borrowers on a Consolidated Basis for such
period, plus (iii) all charges
against income of Borrowers on a
Consolidated Basis for such period for federal,
state and local tax expense.
"EBITDA" shall
mean for any period the sum of (i) Earnings Before Interest
------
and Taxes for such period plus (ii)
depreciation expenses for such period, plus
(iii) amortization expenses for such
period.
"Eligible
Inventory" shall mean and include Inventory consisting of
Rotable
------------------
Inventory, with respect to each Borrower
valued at the lower of cost or market
value, determined on a first-in-first-out
basis, which is not, in Agent's
opinion, obsolete, slow moving or
unmerchantable and which Agent, in its sole
discretion, shall not deem ineligible
Inventory, based on such considerations as
Agent may from time to time deem
appropriate including whether the Inventory is
subject to a perfected, first priority
security interest in favor of Agent and
no other Lien (other than a Permitted
Encumbrance) and whether the Inventory
conforms to all standards imposed by any
Governmental Body which has regulatory
authority over such goods or the use or
sale thereof.
"Eligible
Receivables" shall mean and include with respect to each
--------------------
Borrower, each Receivable (other than Third
Party Receivables) of such Borrower
arising in the Ordinary Course of Business
and which Agent, in its sole credit
judgment, shall deem to be an Eligible
Receivable, based on such considerations
as Agent may from time to time deem
appropriate. A
Receivable shall not be
deemed eligible unless such Receivable is
subject to Agent's first priority
8
<PAGE>
perfected security interest and no other
Lien (other than Permitted
Encumbrances), and is evidenced by an
invoice or other documentary evidence
satisfactory to Agent. In addition, no Receivable shall
be an Eligible
Receivable if:
(a)
it arises out of a sale made by any Borrower to an Affiliate
of any Borrower or to a Person controlled
by an Affiliate of any Borrower;
(b)
it is due or unpaid more than ninety (90) days after the
original due date or one hundred and twenty
(120) days after the original
invoice date;
(c)
fifty percent (50%) or more of the Receivables from such
Customer are not deemed Eligible
Receivables hereunder.
Such percentage may, in
Agent's sole discretion, be increased or
decreased from time to time;
(d)
any covenant, representation or warranty contained in this
Agreement with respect to such Receivable
has been breached;
(e)
the Customer shall (i) apply for, suffer, or consent to the
appointment of, or the taking of possession
by, a receiver, custodian, trustee
or liquidator of itself or of all or a
substantial part of its property or call
a meeting of its creditors, (ii) admit in
writing its inability, or be generally
unable, to pay its debts as they become due
or cease operations of its present
business, (iii) make a general assignment
for the benefit of creditors, (iv)
commence a voluntary case under any state
or federal bankruptcy laws (as now or
hereafter in effect), (v) be adjudicated a
bankrupt or insolvent, (vi) file a
petition seeking to take advantage of any
other law providing for the relief of
debtors, (vii) acquiesce to, or fail to
have dismissed, any petition which is
filed against it in any involuntary case
under such bankruptcy laws, or (viii)
take any action for the purpose of
effecting any of the foregoing;
(f)
the sale is to a Customer outside the continental United
States of America, unless the sale is on
letter of credit, guaranty or
acceptance terms, in each case acceptable
to Agent in its sole discretion;
(g)
the sale to the Customer is on a bill-and-hold, guaranteed
sale, sale-and-return, sale on approval,
consignment or any other repurchase or
return basis or is evidenced by chattel
paper;
(h)
Agent believes, in its sole judgment, that collection of such
Receivable is insecure or that such
Receivable may not be paid by reason of the
Customer's financial inability to pay;
(i)
the Customer is the United States of America, any state or any
department, agency or instrumentality of
any of them, unless the applicable
Borrower assigns its right to payment of
such Receivable to Agent pursuant to
the Assignment of Claims Act of 1940, as
amended (31 U.S.C. Sub-Section 3727 et
seq. and 41 U.S.C. Sub-Section 15 et seq.)
or has otherwise complied with other
applicable statutes or ordinances;
(j)
the goods giving rise to such Receivable have not been shipped
to the Customer or the services giving rise
to such Receivable have not been
performed by the
9
<PAGE>
applicable Borrower or the Receivable
otherwise does not represent a final sale;
(k)
the Receivables of the Customer exceed a credit limit
determined by Agent, in its sole
discretion, to the extent such Receivable
exceeds such limit;
(l)
the Receivable is subject to any offset, deduction, defense,
dispute, or counterclaim, the Customer is
also a creditor or supplier of a
Borrower or the Receivable is contingent in
any respect or for any reason;
(m)
as to the Receivable, the applicable Borrower has made any
agreement with any Customer for any
deduction therefrom, except for discounts or
allowances made in the Ordinary Course of
Business, all of which discounts or
allowances are reflected in the calculation
of the face value of each respective
invoice related thereto;
(n) any return,
rejection or repossession of the merchandise has
occurred or the rendition of services has
been disputed;
(o)
such Receivable is not payable to a Borrower;
(p)
such Receivable is due directly from the patient who benefited
from the services provided by a Borrower in
respect of which such Receivable was
created; or
(q)
such Receivable is not otherwise satisfactory to Agent as
determined in good faith by Agent in the
exercise of its discretion in a
reasonable manner.
"Eligible Third
Party Receivables" shall mean and include with respect to
--------------------------------
each Borrower, those Third Party
Receivables of such Borrower which qualify as
Eligible Receivables, provided, however
that no Receivable shall be an Eligible
Third Party Receivable if it is due or
unpaid more than one hundred and eighty
(180) days after the original invoice
date.
"Eligible
Traditional Receivables" shall mean and include with respect to
--------------------------------
each Borrower, all Eligible Receivables
other than Eligible Third Party
Receivables.
"Environmental
Complaint" shall have the meaning set forth in Section
-----------------------
4.19(d) hereof.
"Environmental
Laws" shall mean all federal, state and local environmental,
------------------
land use, zoning, health, chemical use,
safety and sanitation laws, statutes,
ordinances and codes relating to the
protection of the environment and/or
governing the use, storage, treatment,
generation, transportation, processing,
handling, production or disposal of
Hazardous Substances and the rules,
regulations, policies, guidelines,
interpretations, decisions, orders and
directives of federal, state and local
governmental agencies and authorities
with respect thereto.
"Equipment"
shall mean and include as to each Borrower all of such
---------
Borrower's goods (other than Inventory and
Aircraft, except for Unencumbered
Aircraft) whether now owned or hereafter
acquired and wherever located including
all equipment, machinery, apparatus, motor
vehicles, fittings, furniture,
furnishings, fixtures, parts, accessories,
"appliances" as defined in Section
40102 (a)(11) of Title 49 of the United
States Code and "spare parts" as defined
in Section 40102(a)(38) of Title 49 of the
United States Code, which appliances
and spare parts are
10
<PAGE>
being maintained by the Borrowers at the
locations described on Schedule 4.5 and
------------
all replacements and substitutions therefor
or accessions thereto.
"Equity
Interests" of any Person shall mean any and all shares, rights
to
----------------
purchase, options, warrants, general,
limited or limited liability partnership
interests, member interests, participation
or other equivalents of or interest
in (regardless of how designated) equity of
such Person, whether voting or
nonvoting, including common stock,
preferred stock, convertible securities or
any other "equity security" (as such term
is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated
by the SEC under the Exchange Act).
"ERISA" shall
mean the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time and the rules and
regulations promulgated thereunder.
"Eurodollar
Rate" shall mean for any Eurodollar Rate Loan for the then
---------------
current Interest Period relating thereto
the interest rate per annum determined
by Agent by dividing (the resulting
quotient rounded upwards, if necessary, to
the nearest 1/100th of 1% per annum) (i)
the rate of interest determined by
Agent in accordance with its usual
procedures (which determination shall be
conclusive absent manifest error) to be the
average of the London interbank
offered rates for U.S. Dollars quoted by
the British Bankers' Association as set
forth on Moneyline Telerate (or appropriate
successor or, if British Banker's
Association or its successor ceases to
provide such quotes, a comparable
replacement determined by Agent) display
page 3750 (or such other display page
on the Moneyline Telerate system as may
replace display page 3750) two (2)
Business Days prior to the first day of
such Interest Period for an amount
comparable to such Eurodollar Rate Loan and
having a borrowing date and a
maturity comparable to such Interest Period
by (ii) a number equal to 1.00 minus
the Reserve Percentage. The Eurodollar Rate may also be
expressed by the
following formula:
Average of London interbank offered rates quoted by BBA as shown
on
Eurodollar Rate =Moneyline
Telerate Service display page 3750 or appropriate
successor
1.00 - Reserve
Percentage.
The Eurodollar
Rate shall be adjusted with respect to any Eurodollar Rate
Loan that is outstanding on the effective
date of any change in the Reserve
Percentage as of such effective date.
The Agent shall give
prompt notice to the
Borrowing Agent of the Eurodollar Rate as
determined or adjusted in accordance
herewith, which determination shall be
conclusive absent manifest error.
"Eurodollar Rate
Loan" shall mean an Advance at any time that bears
--------------------
interest based on the Eurodollar Rate.
"Event of
Default" shall have the meaning set forth in Article X hereof.
----------------
"Excess Cash
Flow" for any fiscal period shall mean (a) EBITDA of Borrowers
----------------
on a Consolidated Basis for such fiscal
period minus (b) Unfinanced Capital
-----
Expenditures made by Borrowers on a
Consolidated Basis during such fiscal period
minus (c) taxes actually paid by Borrowers
on a Consolidated Basis during such
-----
fiscal period minus (d) Senior Debt
Payments made by Borrowers on a Consolidated
-----
Basis during such fiscal period.
11
<PAGE>
"Exchange Act"
shall have the mean the Securities Exchange Act of 1934, as
------------
amended.
"Executive Order
No. 13224" shall mean the Executive Order No. 13224 on
-------------------------
Terrorist Financing, effective September
24, 2001, as the same has been, or
shall hereafter be, renewed, extended,
amended or replaced.
"Federal Funds
Effective Rate" for any day shall mean the rate per annum
----------------------------
(based on a year of 360 days and actual
days elapsed and rounded upward to the
nearest 1/100 of 1%) announced by the
Federal Reserve Bank of New York (or any
successor) on such day as being the
weighted average of the rates on overnight
federal funds transactions arranged by
federal funds brokers on the previous
trading day, as computed and announced by
such Federal Reserve Bank (or any
successor) in substantially the same manner
as such Federal Reserve Bank
computes and announces the weighted average
it refers to as the "Federal Funds
Effective Rate" as of the date of this
Agreement; provided, if such Federal
Reserve Bank (or its successor) does not
announce such rate on any day, the
"Federal Funds Effective Rate" for such day
shall be the Federal Funds Effective
Rate for the last day on which such rate
was announced.
"Federal Funds
Open Rate" shall mean the rate per annum determined by the
-----------------------
Agent in accordance with its usual
procedures (which determination shall be
conclusive absent manifest error) to be the
"open" rate for federal funds
transactions as of the opening of business
for federal funds transactions among
members of the Federal Reserve System
arranged by federal funds brokers on such
day, as quoted by Garvin Guybutler
Corporation, any successor entity thereto, or
any other broker selected by the Agent, as
set forth on the applicable Telerate
display page; provided, however; that if
such day is not a Business Day, the
Federal Funds Open Rate for such day shall
be the "open" rate on the immediately
preceding Business Day, or if no such rate
shall be quoted by a Federal funds
broker at such time, such other rate as
determined by the Agent in accordance
with its usual procedures.
Fee Letter"
shall mean the fee letter dated December 29, 2004 among
----------
Borrowers, PNCCM and PNC.
"Financed
Capital Expenditures" shall mean Capital Expenditures made with
-----------------------------
(i) the proceeds of Aircraft Indebtedness
or (ii) Indebtedness (other than
Indebtedness to Lenders under this
Agreement) secured by Permitted Encumbrances
provided for in clause (h) of the
definition of Permitted Encumbrances.
"Fixed Charge
Coverage Ratio" shall mean and include, with respect to any
---------------------------
fiscal period, the ratio of (a) EBITDA
minus the sum of (i) Unfinanced Capital
Expenditures in such period, (ii) cash
taxes paid during such period and (iii)
distributions in such period to (b) all
Senior Debt Payments made during such
period.
"Foreign
Subsidiary" of any Person, shall mean any Subsidiary of such
------------------
Person that is not organized or
incorporated in the United States or any State
or territory thereof.
"Formula Amount"
shall have the meaning set forth in Section 2.1(a).
--------------
"GAAP" shall
mean generally accepted accounting principles in the United
----
States of America in effect from time to
time.
12
<PAGE>
"General
Intangibles" shall mean and include as to each Borrower all of
-------------------
such Borrower's general intangibles,
whether now owned or hereafter acquired,
including all payment intangibles, all
choses in action, causes of action,
corporate or other business records,
inventions, designs, patents, patent
applications, equipment formulations,
manufacturing procedures, quality control
procedures, trademarks, trademark
applications, service marks, trade secrets,
goodwill, copyrights, design rights,
software, computer information, source
codes, codes, records and updates,
registrations, licenses, franchises, customer
lists, tax refunds, tax refund claims,
computer programs, all claims under
guaranties, security interests or other
security held by or granted to such
Borrower to secure payment of any of the
Receivables by a Customer (other than
to the extent covered by Receivables) all
rights of indemnification and all
other intangible property of every kind and
nature (other than Receivables).
"Governmental
Acts" shall have the meaning set forth in Section 2.17.
-----------------
"Governmental
Body" shall mean any nation or government, any state or other
-----------------
political subdivision thereof or any
entity, authority, agency, division or
department exercising the legislative,
judicial, regulatory or administrative
functions of or pertaining to a
government.
"Guarantor"
shall mean any Person who may hereafter guarantee payment or
---------
performance of the whole or any part of the
Obligations and "Guarantors" means
collectively all such Persons.
"Guarantor
Security Agreement" shall mean any Security Agreement executed
----------------------------
by any Guarantor in favor of Agent securing
the Guaranty of such Guarantor.
"Guaranty" shall
mean any guaranty of the obligations of Borrowers executed
--------
by a Guarantor in favor of Agent for its
benefit and for the ratable benefit of
Lenders.
"Hazardous
Discharge" shall have the meaning set forth in Section 4.19(d)
-------------------
hereof.
"Hazardous
Substance" shall mean, without limitation, any flammable
-------------------
explosives, radon, radioactive materials,
asbestos, urea formaldehyde foam
insulation, polychlorinated biphenyls,
petroleum and petroleum products,
methane, hazardous materials, Hazardous
Wastes, hazardous or Toxic Substances or
related materials as defined in CERCLA, the
Hazardous Materials Transportation
Act, as amended (49 U.S.C. Sections 1801,
et seq.), RCRA,
Articles 15 and 27 of
the New York State Environmental
Conservation Law or any other applicable
Environmental Law and in the regulations
adopted pursuant thereto.
"Hazardous
Wastes" shall mean all waste materials subject to regulation
----------------
under CERCLA, RCRA or applicable state law,
and any other applicable Federal and
state laws now in force or hereafter
enacted relating to hazardous waste
disposal.
"Hedge
Liabilities" shall have the meaning provided in the definition
of
-----------------
"Lender-Provided Interest Rate Hedge".
"Implicit
Discount Rate" shall mean the discount rate which when applied
to
----------------------
(i) all scheduled periodic lease payments
through the final possible early buy
out option and (ii) the final buy out
option payment, shall discount such cash
flows to a value equal to the original
cost
13
<PAGE>
of the equipment being leased.
"Indebtedness"
shall mean, with respect to any Person, without duplication
------------
(i) indebtedness for borrowed money (or
evidenced by notes payable, borrowings
under revolving credit facilities, interest
that has accrued and become payable
and the payment of which has been satisfied
by non-cash consideration, and
drafts accepted representing extensions of
credit) payable within one year of
the date of creation (other than
ordinary-course trade payables), (ii) any
obligation payable more than one year from
the date of creation thereof which in
accordance with GAAP should be shown on a
balance sheet as a liability
(including Capitalized Lease Obligations,
borrowings under revolving credit
facilities, interest that has accrued and
become payable and the payment of
which has been satisfied by non-cash
consideration, but excluding reserves for
deferred compensation, deferred income
taxes and post-retirement benefit
liabilities in accordance with Financial
Accounting Standards Board Statement
No. 106), (iii) indebtedness which is
secured by any Lien on property owned by
such Person, whether or not the obligation
secured thereby shall have been
assumed, (iv) the face amount of letters of
credit, bankers' acceptances and
other extensions of credit whether or not
representing obligations for borrowed
money, (v) the net amount of all
obligations with respect to Swaps, (vi)
redemption or repurchase obligations with
respect to mandatorily redeemable or
repurchasable capital stock (or other
Equity Interests) which is subject to
repurchase at the option of the holder
thereof, (vii) all obligations for the
deferred purchase price of property or
services (other than trade or other
accounts payable in the ordinary course of
business), (viii) any unamortized
discount associated with the issuance of
any Indebtedness, and (ix) all
obligations with respect to which such
Person has become liable by way of a
guaranty.
"Ineligible
Security" shall mean any security which may not be underwritten
-------------------
or dealt in by member banks of the Federal
Reserve System under Section 16 of
the Banking Act of 1933 (12 U.S.C. Section
24, Seventh), as amended.
"Intellectual
Property" shall mean property constituting under any
---------------------
Applicable Law a patent, patent
application, copyright, trademark, service mark,
trade name, mask work, trade secret or
license or other right to use any of the
foregoing.
"Intellectual
Property Claim" shall mean the assertion by any Person of a
---------------------------
claim (whether asserted in writing, by
action, suit or proceeding or otherwise)
that Borrower's ownership, use, marketing,
sale or distribution of any
Inventory, Equipment, Intellectual Property
or other property or asset is
violative of any ownership of or right to
use any Intellectual Property of such
Person.
"Interest
Period" shall mean the period provided for any Eurodollar Rate
---------------
Loan pursuant to Section 2.2(b).
"Interest Rate
Hedge" shall mean an interest rate exchange, collar, cap,
-------------------
swap, adjustable strike cap, adjustable
strike corridor or similar agreements
entered into by any Borrower or its
Subsidiaries in order to provide protection
to, or minimize the impact upon, such
Borrower, any Guarantor and/or their
respective Subsidiaries of increasing
floating rates of interest applicable to
Indebtedness.
14
<PAGE>
"Inventory"
shall mean and include as to each Borrower all of such
---------
Borrower's now owned or hereafter acquired
goods, merchandise and other personal
property (other than Aircraft), wherever
located, to be furnished under any
consignment arrangement, contract of
service or held for sale or lease, all raw
materials, work in process, finished goods
and materials and supplies of any
kind, nature or description which are or
might be used or consumed in such
Borrower's business or used in selling or
furnishing such goods, merchandise and
other personal property, and all documents
of title or other documents
representing them.
"Inventory
Advance Rate" shall have the meaning set forth in Section
----------------------
2.1(a)(y)(ii) hereof.
"Investment
Property" shall mean and include as to each Borrower, all of
-------------------
such Borrower's now owned or hereafter
acquired securities (whether certificated
or uncertificated), securities
entitlements, securities accounts, commodities
contracts and commodities accounts.
"Issuer" shall
mean any Person who issues a Letter of Credit and/or accepts
------
a draft pursuant to the terms hereof.
"Lender" and
"Lenders" shall have the meaning ascribed to such term in the
------
-------
preamble to this Agreement and shall
include each Person which becomes a
transferee, successor or assign of any
Lender.
"Lender-Provided
Interest Rate Hedge" shall mean an Interest Rate Hedge
-----------------------------------
which is provided by any Lender and with
respect to which the Agent confirms
meets the following requirements: such
Interest Rate Hedge (i) is documented in
a standard International Swap Dealer
Association Agreement, (ii) provides for
the method of calculating the reimbursable
amount of the provider's credit
exposure in a reasonable and customary
manner, and (iii) is entered into for
hedging (rather than speculative) purposes,
provided that notwithstanding the
--------
foregoing the Wells Fargo Interest Rate
Hedge shall not be a Lender-Provided
Interest Rate Hedge under this Agreement.
The liabilities of any
Borrower to
the provider of any Lender-Provided
Interest Rate Hedge (the "Hedge
Liabilities") shall be "Obligations"
hereunder and otherwise treated as
Obligations for purposes of each of the
Other Documents. The Liens securing the
Hedge Liabilities shall be pari passu with
the Liens securing all other
Obligations under this Agreement and the
Other Documents.
"Letter of
Credit Fees" shall have the meaning set forth in Section 3.2.
---------------------
"Letter of
Credit Borrowing" shall have the meaning set forth in Section
--------------------------
2.12(d).
"Letter of
Credit Sublimit" shall mean $5,000,000.
-------------------------
"Letters of
Credit" shall have the meaning set forth in Section 2.9.
-----------------
"License Agreement" shall mean any
agreement between any Borrower and a
-----------------
Licensor pursuant to which such Borrower is
authorized to use any Intellectual
Property (other than off-the-shelf
software) in connection with the
manufacturing, marketing, sale or other
distribution of any Inventory of such
Borrower or otherwise in connection with
such Borrower's business operations.
15
<PAGE>
"Licensor" shall
mean any Person from whom any Borrower obtains the right
--------
to use (whether on an exclusive or
non-exclusive basis) any Intellectual
Property (other than off-the-shelf
software) in connection with such Borrower's
manufacture, marketing, sale or other
distribution of any Inventory or otherwise
in connection with such Borrower's business
operations.
"Licensor/Agent
Agreement" shall mean an agreement between Agent and a
------------------------
Licensor, in form and content satisfactory
to Agent, by which Agent is given the
unqualified right, vis- -vis such Licensor,
to enforce Agent's Liens with
respect to and to dispose of any Borrower's
Inventory with the benefit of any
Intellectual Property applicable thereto,
irrespective of such Borrower's
default under any License Agreement with
such Licensor.
"Lien" shall
mean any mortgage, deed of trust, pledge, hypothecation,
----
assignment, security interest, lien
(whether statutory or otherwise), Charge,
claim or encumbrance, or preference,
priority or other security agreement or
preferential arrangement held or asserted
in respect of any asset of any kind or
nature whatsoever including any conditional
sale or other title retention
agreement, any lease having substantially
the same economic effect as any of the
foregoing, and the filing of, or agreement
to give, any financing statement
under the Uniform Commercial Code or
comparable law of any jurisdiction.
"Lien Waiver
Agreement" shall mean an agreement which is executed in favor
---------------------
of Agent by a Person who owns or occupies
premises at which any Collateral may
be located from time to time and by which
such Person shall waive any Lien that
such Person may ever have with respect to
any of the Collateral (other than
Collateral that becomes fixtures related to
the operation of the premises) and
shall authorize Agent from time to time to
enter upon the premises to inspect or
remove the Collateral from such premises or
to use such premises to store or
dispose of such Inventory.
"Material
Adverse Effect" shall mean a material adverse effect on (a) the
-----------------------
condition, operations, assets, business or
prospects of Borrowers and their
Subsidiaries taken as a whole, (b) the
Borrowers' ability to duly and punctually
pay or perform the Obligations in
accordance with the terms thereof, (c) the
value of the Collateral, or Agent's Liens
on the Collateral or the priority of
any such Lien or (d) the practical
realization of the benefits of Agent's and
each Lender's rights and remedies under
this Agreement and the Other Documents.
"Maximum Face
Amount" shall mean, with respect to any outstanding Letter of
-------------------
Credit, the face amount of such Letter of
Credit including all automatic
increases provided for in such Letter of
Credit, whether or not any such
automatic increase has become
effective.
"Maximum
Revolving Advance Amount" shall mean $35,000,000.
--------------------------------
"Maximum Undrawn
Amount" shall mean with respect to any outstanding Letter
----------------------
of Credit, the amount of such Letter of
Credit that is or may become available
to be drawn, including all automatic
increases provided for in such Letter of
Credit, whether or not any such automatic
increase has become effective, less
cash collateral specifically securing such
Letter of Credit.
"Multiemployer
Plan" shall mean a "multiemployer plan" as defined in
------------------
Sections 3(37)
16
<PAGE>
and 4001(a)(3) of ERISA.
"Multiple
Employer Plan" shall mean a Plan which has two or more
----------------------
contributing sponsors (including any
Borrower or any member of the Controlled
Group) at least two of whom are not under
common control, as such a plan is
described in Section 4064 of ERISA.
"Net Worth" at a
particular date, shall mean all amounts which would be
---------
included under shareholders' equity on a
balance sheet of Borrowers on a
Consolidated Basis determined in accordance
with GAAP as at such date.
"Note" shall
mean collectively, the Term Note A, the Term Note B and the
----
Revolving Credit Note.
"Obligations"
shall mean and include any and all loans, advances, debts,
-----------
liabilities, obligations, covenants and
duties owing by any Borrower to Lenders
or Agent or to any other direct or indirect
subsidiary or affiliate of Agent or
any Lender of any kind or nature, present
or future (including any interest or
other amounts accruing thereon after
maturity, or after the filing of any
petition in bankruptcy, or the commencement
of any insolvency, reorganization or
like proceeding relating to any Borrower,
whether or not a claim for post-filing
or post-petition interest or other amounts
is allowed in such proceeding, but
excluding any obligations or liabilities
incurred under or in relation to the
Wells Fargo Interest Rate Hedge), whether
or not evidenced by any note, guaranty
or other instrument, whether arising under
any agreement, instrument or
document, (including this Agreement and the
Other Documents) whether or not for
the payment of money, whether arising by
reason of an extension of credit,
opening of a letter of credit, loan,
equipment lease or guarantee, under any
interest or currency swap, future, option
or other similar agreement, or in any
other manner, whether arising out of
overdrafts or deposit or other accounts or
electronic funds transfers (whether through
automated clearing houses or
otherwise) or out of the Agent's or any
Lender's non-receipt of or inability to
collect funds or otherwise not being made
whole in connection with depository
transfer check or other similar
arrangements, whether direct or indirect
(including those acquired by assignment or
participation), absolute or
contingent, joint or several, due or to
become due, now existing or hereafter
arising, contractual or tortious,
liquidated or unliquidated, regardless of how
such indebtedness or liabilities arise or
by what agreement or instrument they
may be evidenced or whether evidenced by
any agreement or instrument, including,
but not limited to, any and all of any
Borrower's Indebtedness and/or
liabilities under this Agreement, the Other
Documents or under any other
agreement between Agent or Lenders and any
Borrower and any amendments,
extensions, renewals or increases and all
costs and expenses of Agent and any
Lender incurred in the documentation,
negotiation, modification, enforcement,
collection or otherwise in connection with
any of the foregoing, including but
not limited to reasonable attorneys' fees
and expenses and all obligations of
any Borrower to Agent or Lenders to perform
acts or refrain from taking any
action.
"Ordinary Course
of Business" shall mean with respect to any Borrower, the
---------------------------
ordinary course of such Borrower's business
as conducted on the Closing Date.
"Original
Closing Date" shall mean October 16, 2002.
---------------------
17
<PAGE>
"Original Loan
Agreement" shall have the meaning set forth in the first
-----------------------
paragraph of the Background section of this
Agreement.
"Other
Documents" shall mean the Note, the Security Agreement, the
---------------
Questionnaire, the Fee Letter, any
Guaranty, any Guarantor Security Agreement,
any Lender-Provided Interest Rate Hedge and
any and all other agreements,
instruments and documents, including
guaranties, pledges, powers of attorney,
consents, Swaps or other similar agreements
and all other writings heretofore,
now or hereafter executed by any Borrower
or any Guarantor and/or delivered to
Agent or any Lender in respect of the
transactions contemplated by this
Agreement.
"Out-of-Formula
Loans" shall have the meaning set forth in Section 16.2(b).
--------------------
"Parent" of any
Person shall mean a corporation or other entity owning,
------
directly or indirectly at least 50% of the
shares of stock or other ownership
interests having ordinary voting power to
elect a majority of the directors of
the Person, or other Persons performing
similar functions for any such Person.
"Participant"
shall mean each Person who shall be granted the right by any
-----------
Lender to participate in any of the
Advances and who shall have entered into a
participation agreement in form and
substance satisfactory to such Lender.
"Participation
Advance" shall have the meaning set forth in Section
---------------------
2.12(d).
"Participation
Commitment" shall mean each Lender's obligation to buy a
------------------------
participation of the Letters of Credit
issued hereunder.
"Payment Office"
shall mean initially Two Tower Center Boulevard, East
--------------
Brunswick, New Jersey 08816; thereafter,
such other office of Agent, if any,
which it may designate by notice to
Borrowing Agent and to each Lender to be the
Payment Office.
"PBGC" shall
mean the Pension Benefit Guaranty Corporation established
----
pursuant to Subtitle A of Title IV of ERISA
or any successor.
"Pension Benefit
Plan" shall mean at any time any employee pension benefit
--------------------
plan (including a Multiple Employer Plan,
but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject
to the minimum funding standards
under Section 412 of the Code and either
(i) is maintained by any member of the
Controlled Group for employees of any
member of the Controlled Group; or (ii)
has at any time within the preceding five
years been maintained by any entity
which was at such time a member of the
Controlled Group for employees of any
entity which was at such time a member of
the Controlled Group.
"Permitted
Encumbrances" shall mean (a) Liens in favor of Agent for the
----------------------
benefit of Agent and Lenders; (b) Liens for
taxes, assessments or other
governmental charges not delinquent or
being contested in good faith and by
appropriate proceedings and with respect to
which proper reserves have been
taken by Borrowers; provided, that, if such
taxes, assessments or other
governmental charges are delinquent, the
Lien shall have no effect on the
priority of the Liens in favor of Agent or
the value of the assets in which
Agent has such a Lien and a stay of
enforcement of any such Lien shall be in
effect; (c) Liens disclosed in the
financial statements
18
<PAGE>
referred to in Section 5.5; (d) deposits or
pledges to secure obligations under
worker's compensation, social security or
similar laws, or under unemployment
insurance; (e) deposits or pledges to
secure bids, tenders, contracts (other
than contracts for the payment of money),
leases, statutory obligations, surety
and appeal bonds and other obligations of
like nature arising in the Ordinary
Course of Business; (f) Liens arising by
virtue of the rendition, entry or
issuance against any Borrower or any
Subsidiary, or any property of any Borrower
or any Subsidiary, of any judgment, writ,
order, or decree for so long as each
such Lien (a) is in existence for less than
20 consecutive days after it first
arises or is being Properly Contested and
(b) is at all times junior in priority
to any Liens in favor of Agent; (g)
mechanics', workers', materialmen's or other
like Liens arising in the Ordinary Course
of Business with respect to
obligations which are not due or which are
being contested in good faith by the
applicable Borrower; (h) Liens placed upon
fixed assets now owned or hereafter
acquired to secure a portion of the
purchase price thereof, provided that (x)
any such Lien shall not encumber any other
property of any Borrower and (y) the
aggregate amount of Indebtedness secured by
such Liens incurred as a result of
such purchases during any fiscal year shall
not exceed the amount provided for
in Section 7.8; (i) Liens disclosed on
Schedule 1.2, including Liens of record
------------
in respect of Reserved Unencumbered
Aircraft; (j) Liens on Aircraft securing
Aircraft Indebtedness; (k) Liens on assets
acquired in a transaction permitted
by Section 7.1(a); (l) statutory or common
law landlord's Liens to secure
payment of rent so long as such Liens are
subordinated to the Liens in favor of
Agent on terms reasonably acceptable to
Agent and (m) mortgages on Borrowers'
facilities in Provo, Utah, St. Louis,
Missouri and Sparta, Illinois provided
that the Indebtedness secured by such
mortgages does not subject any Borrower or
their Subsidiaries to any financial
covenants.
"Person" shall
mean any individual, sole proprietorship, partnership,
------
corporation, business trust, joint stock
company, trust, unincorporated
organization, association, limited
liability company, limited liability
partnership, institution, public benefit
corporation, joint venture, entity or
Governmental Body (whether federal, state,
county, city, municipal or otherwise,
including any instrumentality, division,
agency, body or department thereof).
"Plan" shall
mean any employee benefit plan within the meaning of Section
----
3(3) of ERISA (including a Pension Benefit
Plan), maintained for employees of
any Borrower or any member of the
Controlled Group or any such Plan to which any
Borrower or any member of the Controlled
Group is required to contribute on
behalf of any of its employees.
"PNC" shall have
the meaning set forth in the preamble to this Agreement
---
and shall extend to all of its successors
and assigns.
"Projections"
shall have the meaning set forth in Section 5.5(a) hereof.
-----------
"Properly
Contested" shall mean, in the case of any Indebtedness of any
------------------
Person (including any taxes) that is not
paid as and when due or payable by
reason of such Person's bona fide dispute
concerning its liability to pay same
or concerning the amount thereof, (i) such
Indebtedness is being properly
contested in good faith by appropriate
proceedings promptly instituted and
diligently conducted; (ii) such Person has
established appropriate reserves as
shall be required in conformity with GAAP;
(iii) the non-payment of such
Indebtedness does not have a Material
Adverse Effect and does not result in the
forfeiture of any assets of such Person;
(iv) no Lien is imposed upon any of
such Person's assets with respect to such
Indebtedness unless
19
<PAGE>
such Lien is at all times junior and
subordinate in priority to the Liens in
favor of the Agent (except only with
respect to property taxes that have
priority as a matter of Applicable Law) and
enforcement of such Lien is stayed
during the period prior to the final
resolution or disposition of such dispute;
(v) if such Indebtedness results from, or
is determined by the entry, rendition
or issuance against a Person or any of its
assets of a judgment, writ, order or
decree, enforcement of such judgment, writ,
order or decree is stayed pending a
timely appeal or other judicial review; and
(vi) if such contest is abandoned,
settled or determined adversely (in whole
or in part) to such Person, such
Person forthwith pays such Indebtedness and
all penalties, interest and other
amounts due in connection therewith.
"Purchasing
Lender" shall have the meaning set forth in Section 16.3
-----------------
hereof.
"Questionnaire" shall
mean the Documentation Information Questionnaire and
-------------
the responses thereto provided by Borrowing
Agent and delivered to Agent.
"RCRA" shall
mean the Resource Conservation and Recovery Act, 42 U.S.C.
----
Sec. 6901 et seq., as same may be amended
from time to time.
"Real Property"
shall mean all of each Borrower's right, title and interest
-------------
in and to the owned and leased premises
identified on Schedule 5.24 hereto.
-------------
"Receivables"
shall mean and include, as to each Borrower, all of such
-----------
Borrower's accounts, contract rights,
instruments (including those evidencing
indebtedness owed to such Borrower by its
Affiliates), documents, chattel paper
(including electronic chattel paper),
general intangibles relating to accounts,
drafts and acceptances, credit card
receivables and all other forms of
obligations owing to such Borrower arising
out of or in connection with the sale
or lease of Inventory or the rendition of
services, all supporting obligations,
guarantees and other security therefor,
whether secured or unsecured, now
existing or hereafter created, and whether
or not specifically sold or assigned
to Agent hereunder.
"Receivables
Advance Rate" shall have the meaning set forth in Section
------------------------
2.1(a)(y)(i) hereof.
"Reimbursement
Obligation" shall have the meaning set forth in Section
------------------------
2.12(b)hereof.
"Release" shall
have the meaning set forth in Section 5.7(c)(i) hereof.
-------
"Replacement
Aircraft" shall have the meaning set forth in Section 2.21(b).
--------------------
"Reportable
Event" shall mean a reportable event described in Section
----------------
4043(c) of ERISA or the regulations
promulgated thereunder.
"Required
Lenders" shall mean Lenders holding at least sixty-six and
----------------
two-thirds percent (66 2/3%) of the
Advances and, if no Advances are
outstanding, shall mean Lenders holding
sixty-six and two-thirds percent (66
2/3%) of the Commitment Percentages;
provided, however, if there are fewer than
three (3) Lenders, Required Lenders shall
mean all Lenders.
"Reserved
Unencumbered Aircraft" shall have the meaning set forth in
------------------------------
Section
20
<PAGE>
2.1(a)(y)(iv).
"Reserve
Percentage" shall mean as of any day the maximum percentage in
------------------
effect on such day as prescribed by the
Board of Governors of the Federal
Reserve System (or any successor) for
determining the reserve requirements
(including supplemental, marginal and
emergency reserve requirements) with
respect to eurocurrency funding (currently
referred to as "Eurocurrency
Liabilities".
"Revolving
Advances" shall mean Advances made other than Letters of
Credit,
------------------
Term Loan A and Term Loan B.
"Revolving
Credit Note" shall mean, collectively, the amended and restated
---------------------
promissory notes referred to in Section
2.1(a) hereof.
"Revolving
Interest Rate" shall mean an interest rate per annum equal to
-----------------------
(a) the Alternate Base Rate with respect to
Domestic Rate Loans and (b) the sum
of the Eurodollar Rate plus the Applicable
Margin with respect to Eurodollar
Rate Loans.
"Rotable
Inventory" shall mean all spare engines and propellers and all
-----------------
spare parts, accessories, appliances,
assemblies, equipment, engines, goods and
other items, in each case, which are
appropriate for installation or use on, in
or with any aircraft of any type now owned
or hereafter acquired by any
Borrower, including any replacements,
substitutions or renewals therefor and
accessions thereto and including but not
limited to: any engines, propellers,
fans, valves, sensors, communications,
navigation and radar spare parts,
interior components, landing gear, brakes,
wheels, flight control items, avionic
parts, avionic spare parts, computers,
panel assemblies, amplifiers, circuits,
transformers, seats, windows, storage bins,
bulkhead assemblies, passenger
service units, generators, evacuation
slides and covers, fire detectors, circuit
cards, fire extinguishers, drum assemblies,
transmitters, jackshaft assemblies,
locks, start assemblies, doors and door
assemblies, light assemblies,
alternators, compasses, antennas, ducts,
joints, gauges, fans, windshields,
nozzles, ignitions, engine nose cones,
cable assemblies, secondary equipment,
PCU rudders, engine indication and gas
panels, MLG trucks, landing gears,
transceivers, mounts, turbine wheels,
rudders, crank and shaft assemblies,
motors, transmissions and transmission
assemblies, instrumentation, gearboxes,
gear assemblies, stick assemblies, pumps,
clocks, flight data recorders,
regulators, transducers, toilets and
lavatory spare parts, spare rotable parts
and other equipment, screws, washers,
seals, filters, bolts, gaskets, bushings,
switches, nuts, and drill bits; provided,
that the term "Rotable Inventory"
shall not include any item which is
incorporated in, attached to or specifically
acquired by any Borrower to be used only in
connection with a specific aircraft
of any Borrower.
"SEC" shall mean
the Securities and Exchange Commission or any successor
---
thereto.
"Section 20
Subsidiary" shall mean the Subsidiary of the bank holding
---------------------
company controlling PNC, which Subsidiary
has been granted authority by the
Federal Reserve Board to underwrite and
deal in certain Ineligible Securities.
"Security
Agreement" shall mean the Amended and Restated Security
Agreement
------------------
dated as of the Closing Date between
Borrowers and Agent which is to be recorded
by the Federal Aviation Administration.
21
<PAGE>
"Senior Debt"
shall mean and include (a) all Revolving Advances hereunder,
-----------
plus (b) Term Loan A and Term Loan B, plus
(c) Aircraft Indebtedness, plus (d)
Capitalized Lease Obligations.
"Senior Debt
Payments" shall mean and include all cash actually expended by
--------------------
any Borrower to make (a) interest payments
on any Advances hereunder, plus (b)
principal payments on Term Loan A and Term
Loan B, plus (c) payments for all
fees, expenses, commissions and charges set
forth herein and with respect to any
Advances, plus (d) payments on Capitalized
Lease Obligations, plus (e) payments
with respect to any other Indebtedness for
borrowed money including Aircraft
Indebtedness.
"Settlement
Date" shall mean the Closing Date and thereafter Wednesday or
---------------
Thursday of each week or more frequently if
Agent deems appropriate unless such
day is not a Business Day in which case it
shall be the next succeeding Business
Day.
"Subsidiary" of
any Person shall mean a corporation or other entity of
----------
whose Equity Interests having ordinary
voting power (other than Equity Interests
having such power only by reason of the
happening of a contingency) to elect a
majority of the directors of such
corporation, or other Persons performing
similar functions for such entity, are
owned, directly or indirectly, by such
Person.
"Swaps" shall mean,
with respect to any Person, payment obligations with
-----
respect to Interest Rate Hedges or currency
swaps, caps or similar arrangements
obligating such Person to make payments,
whether periodically or upon the
happening of a contingency. For the purposes of this
Agreement, the amount of
the obligation under any Swap shall be the
amount determined in respect thereof
as of the end of the then most recently
ended fiscal quarter of such Person,
based on the assumption that such Swap had
terminated at the end of such fiscal
quarter, and in making such determination,
if any agreement relating to such
Swap provides for the netting of amounts
payable by and to such Person
thereunder or if any such agreement
provides for the simultaneous payment of
amounts by and to such Person, then in each
such case, the amount of such
obligation shall be the net amount so
determined.
"Term" shall
have the meaning set forth in Section 13.1 hereof.
----
"Term Loan A"
shall mean the Advances made pursuant to Section 2.4(a)
-----------
hereof.
"Term Loan A
Rate" shall mean an interest rate per annum equal to (a) the
----------------
sum of the Alternate Base Rate plus
one-half of one percent (0.50%) with respect
to Domestic Rate Loans and (b) the sum of
the Eurodollar Rate plus the
Applicable Margin with respect to
Eurodollar Rate Loans.
"Term Loan B"
shall mean the Advances made pursuant to Section 2.4(b)
-----------
hereof.
"Term Loan B
Rate" shall mean an interest rate per annum equal to (a) the
----------------
sum of the Alternate Base Rate plus one and
one-half percent (1.50%) with
respect to Domestic Rate Loans and (b) the
sum of the Eurodollar Rate plus three
and three-quarters percent (3.75%) with
respect to Eurodollar Rate Loans.
22
<PAGE>
"Term Loans"
shall mean Term Loan A and Term Loan B, together.
----------
"Term Note A"
shall mean, collectively, the promissory notes described in
-----------
Section 2.4(a) hereof.
"Term Note B"
shall mean, collectively, the promissory notes described in
-----------
Section 2.4(b) hereof.
"Term Notes"
shall mean, collectively, Term Note A and Term Note B.
----------
"Termination
Event" shall mean (i) a Reportable Event with respect to any
-----------------
Plan or Multiemployer Plan; (ii) the
withdrawal of any Borrower or any member of
the Controlled Group from a Plan or
Multiemployer Plan during a plan year in
which such entity was a "substantial
employer" as defined in Section 4001(a)(2)
of ERISA; (iii) the providing of notice of
intent to terminate a Plan in a
distress termination described in Section
4041(c) of ERISA; (iv) the institution
by the PBGC of proceedings to terminate a
Plan or Multiemployer Plan; (v) any
event or condition (a) which might
constitute grounds under Section 4042 of
ERISA for the termination of, or the
appointment of a trustee to administer, any
Plan or Multiemployer Plan, or (b) that may
result in termination of a
Multiemployer Plan pursuant to Section
4041A of ERISA; or (vi) the partial or
complete withdrawal within the meaning of
Sections 4203 and 4205 of ERISA, of
any Borrower or any member of the
Controlled Group from a Multiemployer Plan.
"Third Party
Receivable" shall mean those Receivables due from Medicare,
----------------------
Medicaid, insurance companies, community
based payors and other third party
providers acceptable to Agent in the
exercise of its reasonable discretion.
"Toxic
Substance" shall mean and include any material present on the
Real
---------------
Property which has been shown to have
significant adverse effect on human health
or which is subject to regulation under the
Toxic Substances Control Act (TSCA),
15 U.S.C. Sec.Sec. 2601 et seq., applicable
state law, or any other applicable
Federal or state laws now in force or
hereafter enacted relating to toxic
substances. "Toxic Substance" includes but is
not limited to asbestos,
polychlorinated biphenyls (PCBs) and
lead-based paints.
"Trading with
the Enemy Act" shall mean the foreign assets control
--------------------------
regulations of the United States Treasury
Department (31 CFR, Subtitle B,
Chapter V, as amended) and any enabling
legislation or executive order relating
thereto.
"Transactions"
shall have the meaning set forth in Section 5.5 hereof.
------------
"Transferee"
shall have the meaning set forth in Section 16.3(c) hereof.
----------
"Undrawn
Availability" at a particular date shall mean an amount equal
to
--------------------
(a) the lesser of (i) the Formula Amount or
(ii) the Maximum Revolving Advance
Amount, minus (b) the sum of (i) the
outstanding amount of Advances (other than
Term Loan A and Term Loan B) plus (ii) all
amounts due and owing to any
Borrower's trade creditors which are
outstanding beyond normal trade terms,
unless Properly Contested, plus (iii) fees
and expenses for which Borrowers are
liable but which have not been paid or
charged to Borrowers' Account.
23
<PAGE>
"Unencumbered
Aircraft" shall mean all Aircraft listed on Exhibit C hereof,
---------------------
---------
which Exhibit C may be amended from time to
time as set forth in Section 4.3(b).
---------
"Unfinanced
Capital Expenditures" shall mean all Capital Expenditures that
-------------------------------
are not Financed Capital Expenditures.
"Uniform
Commercial Code" shall have the meaning set forth in Section
1.3
-----------------------
hereof.
"USA PATRIOT
Act" shall mean the Uniting and Strengthening America by
---------------
Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of
2001, Public Law 107-56, as the same has
been, or shall hereafter be, renewed,
extended, amended or replaced.
"Week" shall
mean the time period commencing with the opening of business
----
on a Wednesday and ending on the end of
business the following Tuesday.
"Wells Fargo
Interest Rate Hedge" shall mean that certain Interest Rate
-------------------------------
Swap Agreement dated as of February 7, 2003
by and between LifeNet and Wells
Fargo Bank, N.A. and all related agreements
(as the same may be amended,
modified, restated and/or supplemented from
time to time).
1.3.
Uniform Commercial Code Terms. All terms used herein and
defined
-----------------------------
in the Uniform Commercial Code as adopted
in the State of New York from time to
time (the "Uniform Commercial Code") shall
have the meaning given therein unless
otherwise defined herein. Without limiting the foregoing,
the terms "accounts",
"chattel paper", "instruments", "general
intangibles", "payment intangibles",
"supporting obligations", "securities",
"investment property", "documents",
"deposit accounts", "software", "letter of
credit rights", "inventory",
"equipment" and "fixtures", as and when
used in the description of Collateral
shall have the meanings given to such terms
in Articles 8 or 9 of the Uniform
Commercial Code. To the extent the definition of
any category or type of
Collateral is expanded by any amendment,
modification or revision to the Uniform
Commercial Code, such expanded definition
will apply automatically as of the
date of such amendment, modification or
revision.
1.4.
Certain Matters of Construction. The terms "herein", "hereof"
and
-------------------------------
"hereunder" and other words of similar
import refer to this Agreement as a whole
and not to any particular section,
paragraph or subdivision. All references
herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer
to Articles and Sections of, and Exhibits
and Schedules to, this Agreement. Any
pronoun used shall be deemed to cover all
genders. Wherever
appropriate in the
context, terms used herein in the singular
also include the plural and vice
versa. All references to statutes and
related regulations shall include any
amendments of same and any successor
statutes and regulations. Unless otherwise
provided, all references to any instruments
or agreements to which Agent is a
party, including references to any of the
Other Documents, shall include any and
all modifications or amendments thereto and
any and all extensions or renewals
thereof. All references herein to the time
of day shall mean the time in New
York, New York. Unless otherwise provided, all
financial calculations shall be
performed with Inventory valued on a
first-in, first-out basis. Whenever the
words "including" or "include" shall be
used, such words shall be understood to
mean "including, without limitation" or
"include, without limitation". A
Default or Event of Default shall be deemed
to exist at all times during the
period
24
<PAGE>
commencing on the date that such Default or
Event of Default occurs to the date
on which such Default or Event of Default
is waived in writing pursuant to this
Agreement or, in the case of a Default, is
cured within any period of cure
expressly provided for in this Agreement;
and an Event of Default shall
"continue" or be "continuing" until such
Event of Default has been waived in
writing by the Required Lenders.
Any Lien referred to
in this Agreement or any
of the Other Documents as having been
created in favor of Agent, any agreement
entered into by Agent pursuant to this
Agreement or any of the Other Documents,
any payment made by or to or funds received
by Agent pursuant to or as
contemplated by this Agreement or any of
the Other Documents, or any act taken
or omitted to be taken by Agent, shall,
unless otherwise expressly provided, be
created, entered into, made or received, or
taken or omitted, for the benefit or
account of Agent and Lenders. Wherever the
phrase "to the best of Borrowers'
knowledge" or words of similar import
relating to the knowledge or the awareness
of any Borrower are used in this Agreement
or Other Documents, such phrase shall
mean and refer to (i) the actual knowledge
of (1) the Chief Financial Officer or
the Chief Accounting Officer of AMC or (2)
the President or any Borrower or (3)
the Senior Vice President of the Air
Medical Services or Community Based
Services operating segments of AMC or (ii)
the knowledge that one of the
aforementioned senior officers would have
obtained if he had engaged in good
faith and diligent performance of his
duties, including the making of such
reasonably specific inquiries as may be
necessary of the employees or agents of
such Borrower and a good faith attempt to
ascertain the existence or accuracy of
the matter to which such phrase relates.
All covenants
hereunder shall be given
independent effect so that if a particular
action or condition is not permitted
by any of such covenants, the fact that it
would be permitted by an exception
to, or otherwise within the limitations of,
another covenant shall not avoid the
occurrence of a default if such action is
taken or condition exists. In
addition, all representations and
warranties hereunder shall be given
independent effect so that if a particular
representation or warranty proves to
be incorrect or is breached, the fact that
another representation or warranty
concerning the same or similar subject
matter is correct or is not breached will
not affect the incorrectness or breach of a
representation or warranty
hereunder.
II ADVANCES,
PAYMENTS.
2.1.
Revolving Advances.
------------------
(a)
Amount of Revolving Advances. Subject to the terms and
----------------------------
conditions set forth in this Agreement
including Section 2.1(b), each Lender,
severally and not jointly, will make
Revolving Advances to Borrowers in
aggregate amounts outstanding at any time
equal to such Lender's Commitment
Percentage of the lesser of (x) the Maximum
Revolving Advance Amount less the
aggregate Maximum Undrawn Amount of all
outstanding Letters of Credit or (y) an
amount equal to the sum of:
(i)
up to the sum of (a) 85%, subject to the provisions of
Section 2.1(b) hereof of Eligible
Traditional Receivables and (b) up to 75%,
subject to the provision of Section 2.1(b)
hereof of Eligible Third Party
Receivables (after applying a net
reimbursement rate as calculated during
Agent's collateral monitoring) (the rates
set forth in (a) and (b),
collectively, referred to as the
"Receivables Advance Rate"), plus
------------------------ ----
(ii)
up to the least of (a) 60%, subject to the provisions of
Section
25
<PAGE>
2.1(b) hereof of the lower of cost or
market value of the Eligible Inventory,
(b) 85%, subject to the provisions of
Section 2.1(b) hereof, of the net orderly
liquidation value (based upon Agent's most
recent appraisal) of the Eligible
Inventory (the rates set forth in (a) and
(b), collectively, referred to as the
"Inventory Advance Rate") (the Receivables
Advance Rate and the Inventory
----------------------
Advance Rate shall be referred to
collectively, as the "Advance Rates") or (c)
-------------
$15,000,000 in the aggregate at any one
time, minus
-----
(iii) the aggregate
Maximum Undrawn Amount of all outstanding
Letters of Credit, minus
-----
(iv)
the Aircraft Collateral Value of any Unencumbered
Aircraft that are subject to any Lien
recorded in the recording system
maintained by the Federal Aviation
Administration (other than the Lien of the
Agent, for its benefit and the ratable
benefit of the Lenders) (each such
Unencumbered Aircraft, a "Reserved
Unencumbered Aircraft").
------------------------------
(v)
such reserves as Agent may reasonably deem proper and
necessary from time to time.
The amount
derived from (x) the sum of Sections 2.1(a)(y)(i) and (ii)
minus
-----
(y) the sum of Sections 2.1 (a)(y)(iv) and
(v) at any time and from time to time
shall be referred to as the "Formula
Amount". The Revolving
Advances shall be
evidenced by one or more secured amended
and restated promissory notes
(collectively, the "Revolving Credit Note")
substantially in the form attached
hereto as Exhibit 2.1(a).
---------------
(b)
Discretionary Rights.
The Advance Rates may be increased or
--------------------
decreased by Agent at any time and from
time to time in the exercise of its
reasonable discretion. Each Borrower consents to any such
increases or
decreases and acknowledges that decreasing
the Advance Rates or increasing or
imposing reserves may limit or restrict
Advances requested by Borrowing Agent.
Agent shall give Borrowing Agent five (5)
Business Days prior written notice of
its intention to decrease the Advance
Rates. The rights of
Agent under this
subsection are subject to the provisions of
Section 16.2(b).
2.2.
Procedure for
Revolving Advances Borrowing.
------------------------------------------
(a)
Borrowing Agent on behalf of any Borrower may notify Agent
prior to 1:00 p.m. on a Business Day of a
Borrower's request to incur, on that
day or a designated subsequent day, a
Revolving Advance hereunder that is a
Domestic Rate Loan specifying (i) the date
of the proposed borrowing (which
shall be a Business Day) and (ii) the
amount to be borrowed.
Should any amount
required to be paid as interest hereunder,
or as fees or other charges under
this Agreement or any other agreement with
Agent or Lenders, or with respect to
any other Obligation, become due, same
shall be deemed a request for a Revolving
Advance as of the date such payment is due,
in the amount required to pay in
full such interest, fee, charge or
Obligation under this Agreement or any other
agreement with Agent or Lenders, and such
request shall be irrevocable.
(b)
Notwithstanding the provisions of subsection (a) above, in the
event any Borrower desires to obtain a
Eurodollar Rate Loan, Borrowing Agent
shall give Agent written notice by no later
than 1:00 p.m. on a day which is at
least three (3) Business Days prior to
the
26
<PAGE>
date such Eurodollar Rate Loan is to be
borrowed, specifying (i) the date of the
proposed borrowing (which shall be a
Business Day), (ii) the type of borrowing
and the amount on the date of such Advance
to be borrowed, which amount shall be
in a minimum amount of $1,000,000 and in
integral multiples of $500,000 in
addition thereto, and (iii) the duration of
the first Interest Period therefor.
Interest Periods for Eurodollar Rate Loans
shall be for one, two, three or six
months; provided, if an Interest Period
would end on a day that is not a
Business Day, it shall end on the next
succeeding Business Day unless such day
falls in the next succeeding calendar month
in which case the Interest Period
shall end on the next preceding Business
Day. No Eurodollar
Rate Loan shall be
made available to any Borrower during the
continuance of a Default or an Event
of Default. After giving effect to each
requested Eurodollar Rate Loan,
including those which are converted from a
Domestic Rate Loan under Section
2.2(d), there shall not be outstanding more
than six (6) Eurodollar Rate Loans,
in the aggregate.
(c)
Each Interest Period of a Eurodollar Rate Loan shall commence
on the date such Eurodollar Rate Loan is
made and shall end on such date as
Borrowing Agent may elect as set forth in
subsection (b)(iii) above provided
that the exact length of each Interest
Period shall be determined in accordance
with the practice of the interbank market
for offshore Dollar deposits and no
Interest Period shall end after the last
day of the Term.
In respect of
the Term Loans, Borrowing Agent shall elect the amount to be
borrowed as Domestic Rate Loans and
Eurodollar Rate Loans, and shall specify the
initial Interest Period applicable to a
Eurodollar Rate Loan by its notice of
borrowing given to Agent pursuant to
Section 2.2(b) or by its notice of
conversion given to Agent pursuant to
Section 2.2(d), as the case may be.
Borrowing Agent shall elect the duration of
each succeeding Interest Period for
Eurodollar Rate Loans by giving irrevocable
written notice to Agent of such
duration not later than 1:00 p.m. on the
day which is at least three (3)
Business Days prior to the last day of the
then current Interest Period
applicable to such Eurodollar Rate Loan.
If Agent does not
receive timely
notice of the Interest Period elected by
Borrowing Agent, Borrowing Agent shall
be deemed to have elected to convert to a
Domestic Rate Loan subject to Section
2.2(d) herein below.
Elections in
effect as of the Closing Date made under the Original Loan
Agreement in respect of Revolving Advances
shall remain in effect without regard
to the closing of the Transactions unless
and until converted in accordance with
Section 2.2(d), and no Interest Period
shall be terminated solely by reason of
the Closing Date.
(d)
Provided that no Event of Default shall have occurred and be
continuing, Borrowing Agent may, on the
last Business Day of the then current
Interest Period applicable to any
outstanding Eurodollar Rate Loan, or on any
Business Day with respect to Domestic Rate
Loans, convert any such loan into a
loan of another type in the same aggregate
principal amount provided that any
conversion of a Eurodollar Rate Loan shall
be made only on the last Business Day
of the then current Interest Period
applicable to such Eurodollar Rate Loan. If
Borrowing Agent desires to convert a loan,
Borrowing Agent shall give Agent
written notice by no later than 1:00 p.m.
(i) on the day which is at least three
(3) Business Days' prior to the date on
which such conversion is to occur with
respect to a conversion from a Domestic
Rate Loan to a Eurodollar Rate Loan, or
(ii) on a day which is at least one (1)
Business Day prior to the date on which
such conversion is to occur with respect to
a conversion from a Eurodollar Rate
Loan to a
27
<PAGE>
Domestic Rate Loan, specifying, in each
case, the date of such conversion, the
loans to be converted and if the conversion
is from a Domestic Rate Loan to any
other type of loan, the duration of the
first Interest Period therefor.
(e)
At its option and upon written notice given prior to 1:00 p.m.
at least three (3) Business Days' prior to
the date of such prepayment, any
Borrower may prepay the Eurodollar Rate
Loans in whole at any time or in part
from time to time, without premium or
penalty, with accrued interest on the
principal being prepaid to the date of such
repayment. Such
Borrower shall
specify the date of prepayment of Advances
which are Eurodollar Rate Loans and
the amount of such prepayment. In the event that any prepayment
of a Eurodollar
Rate Loan is required or permitted on a
date other than the last Business Day of
the then current Interest Period with
respect thereto, such Borrower shall
indemnify Agent and Lenders therefor in
accordance with Section 2.2(f) hereof.
(f)
Each Borrower shall indemnify Agent and Lenders and hold Agent
and Lenders harmless from and against any
and all losses or expenses that Agent
and Lenders may sustain or incur as a
consequence of any prepayment, conversion
of or any default by any Borrower in the
payment of the principal of or interest
on any Eurodollar Rate Loan or failure by
any Borrower to complete a borrowing
of, a prepayment of or conversion of or to
a Eurodollar Rate Loan after notice
thereof has been given, including, but not
limited to, any interest payable by
Agent or Lenders to lenders of funds
obtained by it in order to make or maintain
its Eurodollar Rate Loans hereunder.
For purposes of this
Section, it shall be
assumed that Agent or Lenders had obtained
funds from such lenders of funds in
order to make or maintain its Eurodollar
Rate Loans hereunder, for a
corresponding amount and term. A certificate as to any additional
amounts
payable pursuant to the foregoing sentence
submitted by Agent or any Lender to
Borrowing Agent shall be conclusive absent
manifest error.
(g)
Notwithstanding any other provision hereof, if any Applicable
Law, treaty, regulation or directive, or
any change therein or in the
interpretation or application thereof,
shall make it unlawful for any Lender
(for purposes of this subsection (g), the
term "Lender" shall include any Lender
and the office or branch where any Lender
or any corporation or bank controlling
such Lender makes or maintains any
Eurodollar Rate Loans) to make or maintain
its Eurodollar Rate Loans, the obligation
of Lenders to make Eurodollar Rate
Loans hereunder shall forthwith be
cancelled and Borrowers shall, if any
affected Eurodollar Rate Loans are then
outstanding, promptly upon request from
Agent, either pay all such affected
Eurodollar Rate Loans or convert such
affected Eurodollar Rate Loans into loans
of another type. If
any such payment
or conversion of any Eurodollar Rate Loan
is made on a day that is not the last
day of the Interest Period applicable to
such Eurodollar Rate Loan, Borrowers
shall pay Agent, upon Agent's request, such
amount or amounts as may be
necessary to compensate Lenders for any
loss or expense sustained or incurred by
Lenders in respect of such Eurodollar Rate
Loan as a result of such payment or
conversion, including (but not limited to)
any interest or other amounts payable
by Lenders to lenders of funds obtained by
Lenders in order to make or maintain
such Eurodollar Rate Loan. A certificate as to any additional
amounts payable
pursuant to the foregoing sentence
submitted by Lenders to Borrowing Agent shall
be conclusive absent manifest error.
2.3.
Disbursement of Advance Proceeds. All Advances shall be
disbursed
--------------------------------
from
28
<PAGE>
whichever office or other place Agent may
designate from time to time and,
together with any and all other Obligations
of Borrowers to Agent or Lenders,
shall be charged to Borrowers' Account on
Agent's books. During the Term,
Borrowers may use the Revolving Advances by
borrowing, prepaying and
reborrowing, all in accordance with the
terms and conditions hereof. The
proceeds of each Revolving Advance
requested by Borrowing Agent on behalf of any
Borrower or deemed to have been requested
by any Borrower under Section 2.2(a)
hereof shall, with respect to requested
Revolving Advances to the extent Lenders
make such Revolving Advances, be made
available to the applicable Borrower on
the day so requested by way of credit to
such Borrower's operating account at
PNC, or such other bank as Borrowing Agent
may designate following notification
to Agent, in immediately available federal
funds or other immediately available
funds or, with respect to Revolving
Advances deemed to have been requested by
any Borrower, be disbursed to Agent to be
applied to the outstanding Obligations
giving rise to such deemed request.
2.4.
Term Loans.
----------
(a)
Term Loan A. Subject
to the terms and con-ditions of this
-----------
Agreement, each Lender, severally and not
jointly, will make a Term Loan A to
Borrowers in the sum equal to such Lender's
Commitment Percentage of
$12,000,000. Term Loan A shall be advanced on
the Closing Date and shall be,
with respect to principal, payable in equal
consecutive quarterly installments,
each in the sum of $500,000, commencing
April 1, 2006 and continuing on the
first day of each July, October, January
and April thereafter, until the last
day of the Term when the entire unpaid
principal sum of Term Loan A shall be
payable in full, subject to acceleration
upon the occurrence of an Event of
Default under this Agreement or termination
of this Agreement.
Term Loan A
shall be evidenced by one or more secured
promissory notes (collectively, "Term
Note A") in substantially the form attached
hereto as Exhibit 2.4(a).
---------------
(b)
Term Loan B. Subject
to the terms and con-ditions of this
-----------
Agreement, each Lender, severally and not
jointly, will make a Term Loan B to
Borrowers in the sum equal to such Lender's
Commitment Percentage of $8,000,000.
Term Loan B shall be advanced on the
Closing Date and shall be, with respect to
principal, payable in equal consecutive
quarterly installments, each in the sum
of $1,000,000, commencing April 1, 2006 and
continuing on the first day of each
July, October, January and April
thereafter, until March 31, 2008 when the
entire unpaid principal sum of Term Loan B
shall be payable in full, subject to
acceleration upon the occurrence of an
Event of Default under this Agreement or
termination of this Agreement. Term Loan B shall be evidenced by
one or more
secured promissory notes (collectively,
"Term Note B") in substantially the form
attached hereto as Exhibit 2.4(b).
---------------
2.5.
Maximum Revolving Advances. The aggregate balance of
Revolving
--------------------------
Advances outstanding at any time shall not
exceed the lesser of (a) the Maximum
Revolving Advance Amount or (b) the Formula
Amount less, in each case, the
aggregate Maximum Undrawn Amount of all
issued and outstanding Letters of
Credit.
2.6.
Repayment of Advances.
---------------------
(a)
The Revolving Advances shall be due and payable in full on the
last day of the Term subject to earlier
prepayment as herein provided. Term
Loan A shall be due and
29
<PAGE>
payable as provided in Section 2.4(a)
hereof and in Term Note A, subject to
mandatory prepayments as herein provided.
Term Loan B shall be
due and payable
as provided in Section 2.4(b) hereof and in
Term Note B, subject to mandatory
prepayments as herein provided.
(b)
Each Borrower recognizes that the amounts evidenced by checks,
notes, drafts or any other items of payment
relating to and/or proceeds of
Collateral may not be collectible by Agent
on the date received.
In
consideration of Agent's agreement to
conditionally credit Borrowers' Account as
of the Business Day on which Agent receives
those items of payment, each
Borrower agrees that, in computing the
charges under this Agreement, all items
of payment shall be deemed applied by Agent
on account of the Obligations one
(1) Business Day after the Business Day
Agent receives such payments via wire
transfer or electronic depository check.
Agent is not, however,
required to
credit Borrowers' Account for the amount of
any item of payment which is
unsatisfactory to Agent and Agent may
charge Borrowers' Account for the amount
of any item of payment which is returned to
Agent unpaid.
(c)
All payments of principal, interest and other amounts payable
hereunder, or under any of the Other
Documents shall be made to Agent at the
Payment Office not later than 1:00 p.m. on
the due date therefor in lawful money
of the United States of America in federal
funds or other funds immediately
available to Agent. Agent shall have the right to
effectuate payment on any and
all Obligations due and owing hereunder by
charging Borrowers' Account or by
making Advances as provided in Section 2.2
hereof.
(d)
Borrowers shall pay principal, interest, and all other amounts
payable hereunder, or under any related
agreement, without any deduction
whatsoever, including, but not limited to,
any deduction for any setoff or
counterclaim.
2.7.
Repayment of Excess Advances. The aggregate balance of
Advances
----------------------------
outstanding at any time in excess of the
maximum amount of Advances permitted
hereunder shall be immediately due and
payable without the necessity of any
demand, at the Payment Office, whether or
not a Default or Event of Default has
occurred.
2.8.
Statement of Account.
Agent shall maintain, in accordance with
--------------------
its customary procedures, a loan account
("Borrowers' Account") in the name of
Borrowers in which shall be recorded the
date and amount of each Advance made by
Agent and the date and amount of each
payment in respect thereof; provided,
however, the failure by Agent to record the
date and amount of any Advance shall
not adversely affect Agent or any Lender.
Each month, Agent
shall send to
Borrowing Agent a statement showing the
accounting for the Advances made,
payments made or credited in respect
thereof, and other transactions between
Agent and Borrowers during such month.
The monthly statements
shall be deemed
correct and binding upon Borrowers in the
absence of manifest error and shall
constitute an account stated between
Lenders and Borrowers unless Agent receives
a written statement of Borrowers' specific
exceptions thereto within thirty (30)
days after such statement is received by
Borrowing Agent. The
records of Agent
with respect to the loan account shall be
conclusive evidence absent manifest
error of the amounts of Advances and other
charges thereto and of payments
applicable thereto.
2.9.
Letters of Credit.
Subject to the terms and conditions hereof,
-----------------
Agent shall issue or
30
<PAGE>
cause the issuance of standby and/or trade
Letters of Credit ("Letters of
Credit") for the account of any Borrower;
provided, however, that Agent will not
be required to issue or cause to be issued
any Letters of Credit to the extent
that the issuance thereof would then cause
the sum of (i) the outstanding
Revolving Advances plus (ii) the Maximum
Undrawn Amount of all outstanding
Letters of Credit to exceed the lesser of
(x) the Maximum Revolving Advance
Amount or (y) the Formula Amount.
The Maximum Undrawn
Amount of outstanding
Letters of Credit shall not exceed in the
aggregate at any time the Letter of
Credit Sublimit. All disbursements or payments
related to Letters of Credit
shall be deemed to be Domestic Rate Loans
consisting of Revolving Advances and
shall bear interest at the applicable
Revolving Interest Rate for Domestic Rate
Loans; Letters of Credit that have not been
drawn upon shall not bear interest.
2.10.
Issuance of Letters of Credit.
-----------------------------
(a)
Borrowing Agent, on behalf of Borrowers, may request Agent to
issue or cause the issuance of a Letter of
Credit by delivering to Agent at the
Payment Office, Agent's form of Letter of
Credit Application (the "Letter of
Credit Application") completed to the
satisfaction of Agent by 10:00 a.m. at
least three (3) Business Days, or such
shorter period as may be agreed to by
Agent, in advance of the proposed date of
issuance; and, such other
certificates, documents and other papers
and information as Agent may reasonably
request. Borrowing Agent, on behalf of
Borrowers, also has the right to give
instructions and make agreements with
respect to any application, any applicable
letter of credit and security agreement,
any applicable letter of credit
reimbursement agreement and/or any other
applicable agreement, any letter of
credit and the disposition of documents,
disposition of any unutilized funds,
and to agree with Agent upon any amendment,
extension or renewal of any Letter
of Credit.
(b)
Each Letter of Credit shall, among other things, (i) provide
for the payment of sight drafts, other
written demands for payment, or
acceptances of usance drafts when presented
for honor thereunder in accordance
with the terms thereof and when accompanied
by the documents described therein
and (ii) have an expiry date not later than
six (6) months after such Letter of
Credit's date of issuance and in no event
later than the last day of the Term.
Each standby Letter of Credit shall be
subject either to the Uniform Customs and
Practice for Documentary Credits (1993
Revision), International Chamber of
Commerce Publication No. 500, and any
amendments or revision thereof adhered to
by the Issuer ("UCP 500") or the
International Standby Practices
(ISP98-International Chamber of Commerce
Publication Number 590) (the "ISP98
Rules"), as determined by Agent, and each
trade Letter of Credit shall be
subject to UCP 500.
(c)
Agent shall use its reasonable efforts to notify Lenders of
the request by Borrowing Agent for a Letter
of Credit hereunder.
2.11.
Requirements For Issuance of Letters of Credit.
----------------------------------------------
(a)
In
connection with the issuance of any Letter of Credit,
Borrowers shall indemnify, save and hold
Agent, each Lender and each Issuer
harmless from any loss, cost, expense or
liability, including payments made by
Agent, any Lender or any Issuer and
expenses
31
<PAGE>
and reasonable attorneys' fees incurred by
Agent, any Lender or Issuer arising
out of, or in connection with, any Letter
of Credit to be issued or created for
any Borrower. Borrowers shall be bound by
Agent's or any Issuer's regulations
and good faith interpretations of any
Letter of Credit issued or created for
Borrowers' Account, although this
interpretation may be different from its own;
and, neither Agent, nor any Lender, nor any
Issuer nor any of their
correspondents shall be liable for any
error, negligence, or mistakes, whether
of omission or commission, in following
Borrowing Agent's or any Borrower's
instructions or those contained in any
Letter of Credit or of any modifications,
amendments or supplements thereto or in
issuing or paying any Letter of Credit,
except for Agent's, any Lender's, any
Issuer's or such correspondents' willful
misconduct.
(b)
Borrowing Agent shall authorize and direct any Issuer to name
the applicable Borrower as the "Applicant"
or "Account Party" of each Letter of
Credit. If Agent is not the Issuer of any
Letter of Credit, Borrowing Agent
shall authorize and direct the Issuer to
deliver to Agent all instruments,
documents, and other writings and property
received by the Issuer pursuant to
the Letter of Credit and to accept and rely
upon Agent's instructions and
agreements with respect to all matters
arising in connection with the Letter of
Credit, the application therefor or any
acceptance therefor.
(c)
In connection with all Letters of Credit issued or caused to
be issued by Agent under this Agreement,
each Borrower hereby appoints Agent, or
its designee, as its attorney, with full
power and authority (i) to sign and/or
endorse such Borrower's name upon any
warehouse or other receipts, letter of
credit applications and acceptances; (ii)
to sign such Borrower's name on bills
of lading; (iii) to clear Inventory through
the United States of America Customs
Department ("Customs") in the name of such
Borrower or Agent or Agent's
designee, and to sign and deliver to
Customs officials powers of attorney in the
name of such Borrower for such purpose; and
(iv) to complete in such Borrower's
name or Agent's, or in the name of Agent's
designee, any order, sale or
transaction, obtain the necessary documents
in connection therewith, and collect
the proceeds thereof. Neither Agent nor its attorneys
will be liable for any
acts or omissions nor for any error of
judgment or mistakes of fact or law,
except for Agent's or its attorney's
willful misconduct.
This power, being
coupled with an interest, is irrevocable as
long as any Letters of Credit remain
outstanding.
2.12.
Disbursements, Reimbursement.
----------------------------
(a)
Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to,
purchase from Agent a participation in such
Letter of Credit and each drawing
thereunder in an amount equal to such
Lender's Commitment Percentage of the
Maximum Face Amount of such Letter of
Credit and the amount of such drawing,
respectively.
(b)
In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee
thereof, Agent will promptly notify
Borrowing Agent. Provided that Borrowing Agent
shall have received such notice,
the Borrowers shall reimburse (such
obligation to reimburse Agent shall
sometimes be referred to as a
"Reimbursement Obligation") Agent prior to 12:00
Noon on each date that an amount is paid by
Agent under any Letter of Credit
(each such date, a "Drawing Date") in an
amount equal to the amount so paid by
Agent.
32
<PAGE>
In the event Borrowers fail to reimburse
Agent for the full amount of any
drawing under any Letter of Credit by 12:00
Noon on the Drawing Date, Agent will
promptly notify each Lender thereof, and
Borrowers shall be deemed to have
requested that a Domestic Rate Loan be made
by the Lenders to be disbursed on
the Drawing Date under such Letter of
Credit, subject to the amount of the
unutilized portion of the lesser of Maximum
Revolving Advance Amount or the
Formula Amount and subject to Section 8.2
hereof. Any notice
given by Agent
pursuant to this Section 2.12(b) may be
oral if immediately confirmed in
writing; provided that the lack of such an
immediate confirmation shall not
affect the conclusiveness or binding effect
of such notice.
(c)
Each Lender shall upon any notice pursuant to Section 2.12(b)
make available to Agent an amount in
immediately available funds equal to its
Commitment Percentage of the amount of the
drawing, whereupon the participating
Lenders shall (subject to Section 2.12(d))
each be deemed to have made a
Domestic Rate Loan to Borrowers in that
amount. If any Lender
so notified fails
to make available to Agent the amount of
such Lender's Commitment Percentage of
such amount by no later than 2:00 p.m. on
the Drawing Date, then interest shall
accrue on such Lender's obligation to make
such payment, from the Drawing Date
to the date on which such Lender makes such
payment (i) at a rate per annum
equal to the Federal Funds Rate during the
first three days following the
Drawing Date and (ii) at a rate per annum
equal to the rate applicable to
Domestic Rate Loans on and after the fourth
day following the Drawing Date.
Agent will promptly give notice of the
occurrence of the Drawing Date, but
failure of Agent to give any such notice on
the Drawing Date or in sufficient
time to enable any Lender to effect such
payment on such date shall not relieve
such Lender from its obligation under this
Section 2.12(c), provided that such
Lender shall not be obligated to pay
interest as provided in Section 2.12(c) (i)
and (ii) until and commencing from the date
of receipt of notice from Agent of a
drawing.
(d)
With respect to any unreimbursed drawing that is not converted
into a Domestic Rate Loan to Borrowers in
whole or in part as contemplated by
Section 2.12(b), because of Borrowers'
failure to satisfy the conditions set
forth in Section 8.2 (other than any notice
requirements) or for any other
reason, Borrowers shall be deemed to have
incurred from Agent a borrowing (each
a "Letter of Credit Borrowing") in the
amount of such drawing. Such Letter of
Credit Borrowing shall be due and payable
on demand (together with interest) and
shall bear interest at the rate per annum
applicable to a Domestic Rate Loan.
Each Lender's payment to Agent pursuant to
Section 2.12(c) shall be deemed to be
a payment in respect of its participation
in such Letter of Credit Borrowing and
shall constitute a "Participation Advance"
from such Lender in satisfaction of
its Participation Commitment under this
Section 2.12.
(e)
Each Lender's Participation Commitment shall continue until
the last to occur of any of the following
events: (x) Agent
ceases to be
obligated to issue or cause to be issued
Letters of Credit hereunder; (y) no
Letter of Credit issued or created
hereunder remains outstanding and uncancelled
and (z) all Persons (other than the
Borrowers) have been fully reimbursed for
all payments made under or relating to
Letters of Credit.
2.13.
Repayment of Participation Advances.
-----------------------------------
(a)
Upon (and only upon) receipt by Agent for its account of
immediately available funds from Borrowers
(i) in reimbursement of any payment
made by the Agent under
33
<PAGE>
the Letter of Credit with respect to which
any Lender has made a Participation
Advance to Agent, or (ii) in payment of
interest on such a payment made by Agent
under such a Letter of Credit, Agent will
pay to each Lender, in the same funds
as those received by Agent, the amount of
such Lender's Commitment Percentage of
such funds, except Agent shall retain the
amount of the Commitment Percentage of
such funds of any Lender that did not make
a Participation Advance in respect of
such payment by Agent.
(b)
If Agent is required at any time to return to any Borrower, or
to a trustee, receiver, liquidator,
custodian, or any official in any insolvency
proceeding, any portion of the payments
made by Borrowers to Agent pursuant to
Section 2.13(a) in reimbursement of a
payment made under the Letter of Credit or
interest or fee thereon, each Lender shall,
on demand of Agent, forthwith return
to Agent the amount of its Commitment
Percentage of any amounts so returned by
Agent plus interest at the Federal Funds
Effective Rate.
2.14.
Documentation. Each
Borrower agrees to be bound by the terms of
-------------
the Letter of Credit Application and by
Agent's interpretations of any Letter of
Credit issued on behalf of such Borrower
and by Agent's written regulations and
customary practices relating to letters of
credit, though Agent's
interpretations may be different from such
Borrower's own. In the
event of a
conflict between the Letter of Credit
Application and this Agreement, this
Agreement shall govern. It is understood and agreed that,
except in the case of
gross negligence or willful misconduct (as
determined by a court of competent
jurisdiction in a final non-appealable
judgment), Agent shall not be liable for
any error, negligence and/or mistakes,
whether of omission or commission, in
following the Borrowing Agent's or any
Borrower's instructions or those
contained in the Letters of Credit or any
modifications, amendments or
supplements thereto.
2.15.
Determination to Honor Drawing Request. In determining whether
--------------------------------------
to honor any request for drawing under any
Letter of Credit by the beneficiary
thereof, Agent shall be responsible only to
determine that the documents and
certificates required to be delivered under
such Letter of Credit have been
delivered and that they comply on their
face with the requirements of such
Letter of Credit and that any other drawing
condition appearing on the face of
such Letter of Credit has been satisfied in
the manner so set forth.
2.16.
Nature of Participation and Reimbursement Obligations. Each
-----------------------------------------------------
Lender's obligation in accordance with this
Agreement to make the Revolving
Advances or Participation Advances as a
result of a drawing under a Letter of
Credit, and the obligations of Borrowers to
reimburse Agent upon a draw under a
Letter of Credit, shall be absolute,
unconditional and irrevocable, and shall be
performed strictly in accordance with the
terms of this Section 2.16 under all
circumstances, including the following
circumstances:
(i)
any set-off, counterclaim, recoupment, defense or other
right which such Lender may have against
Agent, any Borrower or any other Person
for any reason whatsoever;
(ii)
the failure of any Borrower or any other Person to
comply, in connection with a Letter of
Credit Borrowing, with the conditions set
forth in this Agreement for the making of a
Revolving Advance, it being
acknowledged that such conditions are not
required
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for the making of a Letter of Credit
Borrowing and the obligation of the Lenders
to make Participation Advances under
Section 2.12;
(iii) any lack of
validity or enforceability of any Letter of
Credit;
(iv)
any claim of breach of warranty that might be made by
Borrower or any Lender against the
beneficiary of a Letter of Credit, or the
existence of any claim, set-off,
recoupment, counterclaim, crossclaim, defense
or other right which any Borrower or any
Lender may have at any time against a
beneficiary, any successor beneficiary or
any transferee of any Letter of Credit
or the proceeds thereof (or any Persons for
whom any such transferee may be
acting), Agent or any Lender or any other
Person, whether in connection with
this Agreement, the transactions
contemplated herein or any unrelated
transaction (including any underlying
transaction between any Borrower or any
Subsidiaries of such Borrower and the
beneficiary for which any Letter of Credit
was procured);
(v)
the lack of power or authority of any signer of (or any
defect in or forgery of any signature or
endorsement on) or the form of or lack
of validity, sufficiency, accuracy,
enforceability or genuineness of any draft,
demand, instrument, certificate or other
document presented under or in
connection with any Letter of Credit, or
any fraud or alleged fraud in
connection with any Letter of Credit, or
the transport of any property or
provisions of services relating to a Letter
of Credit, in each case even if
Agent or any of Agent's Affiliates has been
notified thereof;
(vi)
payment by Agent under any Letter of Credit against
presentation of a demand, draft or
certificate or other document which does not
comply with the terms of such Letter of
Credit absent Agent's gross negligence
or willful misconduct;
(vii) the solvency of,
or any acts or omissions by, any
beneficiary of any Letter of Credit, or any
other Person having a role in any
transaction or obligation relating to a
Letter of Credit, or the existence,
nature, quality, quantity, condition, value
or other characteristic of any
property or services relating to a Letter
of Credit;
(viii) any failure by
the Agent or any of Agent's Affiliates
to issue any Letter of Credit in the form
requested by any Borrower, unless the
Agent has received written notice from such
Borrower of such failure within
three (3) Business Days after the Agent
shall have furnished Borrower a copy of
such Letter of Credit and such error is
material and no drawing has been made
thereon prior to receipt of such
notice;
(ix)
any Material Adverse Effect on any Borrower or any
Guarantor;
(x)
any breach of this Agreement or any Other Document by any
party thereto;
(xi)
the occurrence or continuance of an insolvency
proceeding with respect to any Borrower or
any Guarantor;
(xii) the fact that a
Default or Event of Default shall have
occurred and be continuing;
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<PAGE>
(xiii) the fact that
the Term shall have expired or this
Agreement or the Obligations hereunder
shall have been terminated; and
(xiv) any other
circumstance or happening whatsoever, whether
or not similar to any of the foregoing.
2.17.
Indemnity. In addition
to amounts payable as provided in Section
---------
16.5, each Borrower hereby agrees to
protect, indemnify, pay and save harmless
Agent and any of Agent's Affiliates that
have issued a Letter of Credit from and
against any and all claims, demands,
liabilities, damages, taxes, penalties,
interest, judgments, losses, costs, charges
and expenses (including reasonable
fees, expenses and disbursements of counsel
and allocated costs of internal
counsel) which the Agent or any of Agent's
Affiliates may incur or be subject to
as a consequence, direct or indirect, of
the issuance of any Letter of Credit,
other than as a result of (A) the gross
negligence or willful misconduct of the
Agent as determined by a final and
non-appealable judgment of a court of
competent jurisdiction or (b) the wrongful
dishonor by the Agent or any of
Agent's Affiliates of a proper demand for
payment made under any Letter of
Credit, except if such dishonor resulted
from any act or omission, whether
rightful or wrongful, of any present or
future de jure or de facto Governmental
Body (all such acts or omissions herein
called "Governmental Acts").
2.18.
Liability for Acts and Omissions. As between Borrowers and Agent
--------------------------------
and Lenders, each Borrower assumes all
risks of the acts and omissions of, or
misuse of the Letters of Credit by, the
respective beneficiaries of such Letters
of Credit. In furtherance and not in
limitation of the respective foregoing,
Agent shall not be responsible for: (i) the
form, validity, sufficiency,
accuracy, genuineness or legal effect of
any document submitted by any party in
connection with the application for an
issuance of any such Letter of Credit,
even if it should in fact prove to be in
any or all respects invalid,
insufficient, inaccurate, fraudulent or
forged (even if Agent shall have been
notified thereof); (ii) the validity or
sufficiency of any instrument
transferring or assigning or purporting to
transfer or assign any such Letter of
Credit or the rights or benefits thereunder
or proceeds thereof, in whole or in
part, which may prove to be invalid or
ineffective for any reason; (iii) the
failure of the beneficiary of any such
Letter of Credit, or any other party to
which such Letter of Credit may be
transferred, to comply fully with any
conditions required in order to draw upon
such Letter of Credit or any other
claim of any Borrower against any
beneficiary of such Letter of Credit, or any
such transferee, or any dispute between or
among any Borrower and any
beneficiary of any Letter of Credit or any
such transferee; (iv) errors,
omissions, interruptions or delays in
transmission or delivery of any messages,
by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical
terms; (vi) any loss or delay in the
transmission or otherwise of any document
required in order to make a drawing
under any such Letter of Credit or of the
proceeds thereof; (vii) the
misapplication by the beneficiary of any
such Letter of Credit of the proceeds
of any drawing under such Letter of Credit;
or (viii) any consequences arising
from causes beyond the control of Agent,
including any governmental acts, and
none of the above shall affect or impair,
or prevent the vesting of, any of
Agent's rights or powers hereunder. Nothing
in the preceding sentence shall
relieve Agent from liability for Agent's
gross negligence or willful misconduct
(as determined by a court of competent
jurisdiction in a final non-appealable
judgment) in connection with actions or
omissions described in such clauses (i)
through (viii) of such sentence.
In no event shall
Agent or Agent's Affiliates
be liable to any Borrower for any
36
<PAGE>
indirect, consequential, incidental,
punitive, exemplary or special damages or
expenses (including attorneys' fees), or
for any damages resulting from any
change in the value of any property
relating to a Letter of Credit.
Without limiting
the generality of the foregoing, Agent and each of its
Affiliates (i) may rely on any oral or
other communication believed in good
faith by Agent or such Affiliate to have been
authorized or given by or on
behalf of the applicant for a Letter of
Credit, (ii) may honor any presentation
if the documents presented appear on their
face substantially to comply with the
terms and conditions of the relevant Letter
of Credit; (iii) may honor a
previously dishonored presentation under a
Letter of Credit, whether such
dishonor was pursuant to a court order, to
settle or compromise any claim of
wrongful dishonor, or otherwise, and shall
be entitled to reimbursement to the
same extent as if such presentation had
initially been honored, together with
any interest paid by Agent or its
Affiliates; (iv) may honor any drawing that is
payable upon presentation of a statement
advising negotiation or payment, upon
receipt of such statement (even if such
statement indicates that a draft or
other document is being delivered
separately), and shall not be liable for any
failure of any such draft or other document
to arrive, or to conform in any way
with the relevant Letter of Credit; (v) may
pay any paying or negotiating bank
claiming that it rightfully honored under
the laws or practices of the place
where such bank is located; and (vi) may
settle or adjust any claim or demand
made on Agent or its Affiliate in any way
related to any order issued at the
applicant's request to an air carrier, a
letter of guarantee or of indemnity
issued to a carrier or any similar document
(each an "Order") and honor any
drawing in connection with any Letter of
Credit that is the subject of such
Order, notwithstanding that any drafts or
other documents presented in
connection with such Letter of Credit fail
to conform in any way with such
Letter of Credit.
In furtherance
and extension and not in limitation of the specific
provisions set forth above, any action
taken or omitted by Agent under or in
connection with the Letters of Credit
issued by it or any documents and
certificates delivered thereunder, if taken
or omitted in good faith and without
gross negligence or willful misconduct (as
determined by a court of competent
jurisdiction in a final non-appealable
judgment), shall not put Agent under any
resulting liability to any Borrower or any
Lender.
2.19.
Additional Payments.
Any sums expended by Agent or any Lender
-------------------
due to any Borrower's failure to perform or
comply with its obligations under
this Agreement or any Other Document
including any Borrower's obligations under
Sections 4.2, 4.4, 4.12, 4.13, 4.14 and 6.1
hereof, may be charged to Borrowers'
Account as a Revolving Advance and added to
the Obligations.
2.20.
Manner of Borrowing and Payment.
-------------------------------
(a)
Each borrowing of Revolving Advances shall be advanced
according to the applicable Commitment
Percentages of Lenders. Term Loan A and
Term Loan B shall each be advanced
according to the Commitment Percentages of
Lenders.
(b)
Each payment (including each prepayment) by any Borrower on
account of the principal of and interest on
the Revolving Advances, shall be
applied to the Revolving Advances pro rata
according to the applicable
Commitment Percentages of Lenders.
Each
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<PAGE>
payment (including each prepayment) by any
Borrower on account of the principal
of and interest on Term Note A, shall be
made from or to, or applied to that
portion of Term Loan A evidenced by Term
Note A pro rata according to the
Commitment Percentages of Lenders.
Each payment
(including each prepayment) by
any Borrower on account of the principal of
and interest on the Term Note B,
shall be applied to that portion of Term
Loan B evidenced by Term Note B pro
rata according to the Commitment
Percentages of Lenders. Except as expressly
provided herein, all payments (including
prepayments) to be made by any Borrower
on account of principal, interest and fees
shall be made without set off or
counterclaim and shall be made to Agent on
behalf of the Lenders to the Payment
Office, in each case on or prior to 1:00
p.m., in Dollars and in immediately
available funds.
(c)
(i)
Notwithstanding anything to the contrary contained in
Sections 2.20(a) and (b) hereof, commencing
with the first Business Day
following the Closing Date, each borrowing
of Revolving Advances shall be
advanced by Agent and each payment by any
Borrower on account of Revolving
Advances shall be applied first to those
Revolving Advances advanced by Agent.
On or before 1:00 p.m. on each Settlement
Date commencing with the first
Settlement Date following the Closing Date,
Agent and Lenders shall make certain
payments as follows: (I) if the aggregate
amount of new Revolving Advances made
by Agent during the preceding Week (if any)
exceeds the aggregate amount of
repayments applied to outstanding Revolving
Advances during such preceding Week,
then each Lender shall provide Agent with
funds in an amount equal to its
applicable Commitment Percentage of the
difference between (w) such Revolving
Advances and (x) such repayments and (II)
if the aggregate amount of repayments
applied to outstanding Revolving Advances
during such Week exceeds the aggregate
amount of new Revolving Advances made
during such Week, then Agent shall provide
each Lender with funds in an amount equal
to its applicable Commitment
Percentage of the difference between (y)
such repayments and (z) such Revolving
Advances.
(ii)
Each Lender shall be entitled to earn interest at the
applicable Contract Rate on outstanding
Advances which it has funded.
(iii) Promptly
following each Settlement Date, Agent shall
submit to each Lender a certificate with
respect to payments received and
Advances made during the Week immediately
preceding such Settlement Date. Such
certificate of Agent shall be conclusive in
the absence of manifest error.
(d)
If any Lender or Participant (a "benefited Lender") shall at
any time receive any payment of all or part
of its Advances, or interest
thereon, or receive any Collateral in
respect thereof (whether voluntarily or
involuntarily or by set-off) in a greater
proportion than any such payment to
and Collateral received by any other
Lender, if any, in respect of such other
Lender's Advances, or interest thereon, and
such greater proportionate payment
or receipt of Collateral is not expressly
permitted hereunder, such benefited
Lender shall purchase for cash from the
other Lenders a participation in such
portion of each such other Lender's
Advances, or shall provide such other Lender
with the benefits of any such Collateral,
or the proceeds thereof, as shall be
necessary to cause such benefited Lender to
share the excess payment or benefits
of such Collateral or proceeds ratably with
each of the other Lenders; provided,
however, that if all
38
<PAGE>
or any portion of such excess payment or
benefits is thereafter recovered from
such benefited Lender, such purchase shall
be rescinded, and the purchase price
and benefits returned, to the extent of
such recovery, but without interest.
Each Lender so purchasing a portion of
another Lender's Advances may exercise
all rights of payment (including rights of
set-off) with respect to such portion
as fully as if such Lender were the direct
holder of such portion.
(e)
Unless Agent shall have been notified by telephone, confirmed
in writing, by any Lender that such Lender
will not make the amount which would
constitute its applicable Commitment
Percentage of the Advances available to
Agent, Agent may (but shall not be
obligated to) assume that such Lender shall
make such amount available to Agent on the
next Settlement Date and, in reliance
upon such assumption, make available to
Borrowers a corresponding amount. Agent
will promptly notify Borrowers of its
receipt of any such notice from a Lender.
If such amount is made available to Agent
on a date after such next Settlement
Date, such Lender shall pay to Agent on
demand an amount equal to the product of
(i) the daily average Federal Funds Rate
(computed on the basis of a year of 360
days) during such period as quoted by
Agent, times (ii) such amount, times (iii)
the number of days from and including such
Settlement Date to the date on which
such amount becomes immediately available
to Agent. A
certificate of Agent
submitted to any Lender with respect to any
amounts owing under this paragraph
(e) shall be conclusive, in the absence of
manifest error. If
such amount is
not in fact made available to Agent by such
Lender within three (3) Business
Days after such Settlement Date, Agent
shall be entitled to recover such an
amount, with interest thereon at the rate
per annum then applicable to such
Revolving Advances hereunder, on demand
from Borrowers; provided, however, that
Agent's right to such recovery shall not
prejudice or otherwise adversely affect
Borrowers' rights (if any) against such
Lender.
2.21.
Mandatory Prepayments.
---------------------
(a)
Subject to Sections 2.21(b) and 4.3 hereof, when any Borrower
sells or otherwise disposes of any
Collateral other than Unencumbered Aircraft
or Inventory in the Ordinary Course of
Business, Borrowers shall repay the
Advances in an amou
