UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Date of Report (Date of earliest event reported): December 22, 2003
(Exact name of Registrant as specified in its charter)
Delaware |
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333-64687 |
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13-3634726 |
(State or other
jurisdiction of
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(Commission File Number) |
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(I.R.S. Employer
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2122
York Road
Oak Brook, Illinois 60523
(Address of Principal Executive Offices)
(630) 574-3000
(Registrants telephone number, including area code)
Item 1. Changes in Control of Registrant.
On November 12, 2003, GLDD Acquisitions Corp. entered into an agreement and plan of merger with respect to the purchase of all of the outstanding capital stock of Great Lakes Dock & Dredge Corporation (GLDD), for approximately $357 million, including fees and expenses. GLDD Acquisitions Corp. is owned by Madison Dearborn Capital Partners, IV, L.P. (MDP), which is an affiliate of Chicago-based private equity investment firm, Madison Dearborn Partners, LLC, certain of its co-investors and members of GLDDs management. The agreement and plan of merger, as amended and restated on December 22, 2003 (the Merger Agreement), is filed as Exhibit 2.1 hereto. The acquisition was consummated on December 22, 2003. MDP acquired control of GLDD from Vectura Holding Company LLC, a portfolio company of Citigroup Venture Capital Ltd.
The acquisition was financed by equity contributions of approximately $97.0 million, the issuance through a private offering of $175.0 million of 7.75% Senior Subordinated Notes due 2013, term loan borrowings under a new senior credit facility of approximately $60.3 million, term loan borrowings under a new equipment financing facility of approximately $23.4 million and the rollover of approximately $1.3 million of capital leases.
The $175.0 million of 7.75% Senior Subordinated Notes due 2013 were issued pursuant to an Indenture, dated as of December 22, 2003, by and among GLDD Merger Sub, Inc. and BNY Midwest Trust Company, as trustee. GLDD Merger Sub, Inc. was merged with and into GLDD pursuant to the Merger Agreement and GLDD assumed the obligations with respect to the notes pursuant to a Supplemental Indenture, dated as of December 22, 2003, by and among GLDD, the guarantors party thereto and BNY Midwest Trust Company, as trustee. The indenture and supplemental indenture are filed as Exhibits 4.1 and 4.2 hereto.
The new senior credit facility was entered into pursuant to a Credit Agreement, dated as of December 22, 2003, among GLDD Acquisitions Corp., GLDD, Lehman Brothers Inc. and Credit Suisse First Boston, acting through its Cayman Islands Branch, as Joint Advisors, Joint Lead Arrangers and Joint Book Runners, and Bank of America, N.A., as an issuer of the Letters of Credit, and as representative for the lenders. The Credit Agreement is filed as Exhibit 10.1 hereto. The new senior credit facility provides for a seven-year term loan B facility in the aggregate principal amount of $60.3 million and a five-year revolving credit facility of up to $60.0 million in borrowings and letters of credit. Obligations under the new senior credit facility are secured by a perfected first priority lien on certain equipment of GLDD and its subsidiary, Great Lakes Dredge & Dock Company ("GLDD Company"), limited up to $70.0 million of orderly liquidation value of such equipment; a perfected second priority lien on certain other equipment of GLDD and GLDD Company having an orderly liquidation value of $80.0 million; a perfected first priority lien on GLDDs inter-company receivables and the inter-company receivables of its direct and indirect domestic subsidiaries shared on a pari passu with GLDDs bonding company; and a perfected second priority lien on GLDDs accounts receivable and the accounts receivable of its direct and indirect subsidiaries that relate to bonded projects.
The new equipment financing facility was entered into pursuant to a Credit Agreement, dated as of December 17, 2003, by and between GLDD Company and General Electric Capital Corporation, which is filed as Exhibit 10.2 hereto. The agreement provides for a ten-year term loan in the aggregate principal amount of approximately $23.4 million. The obligations under the equipment financing facility are secured by a perfected first priority lien on certain vessels of GLDD Company.
As a result of the transaction, all of the equity securities of GLDD are owned by GLDD Acquisitions Corp. MDP owns approximately 85% of the common stock of GLDD Acquisitions Corp. and approximately 95% of the non-voting preferred stock of GLDD Acquisitions Corp., which preferred stock has an aggregate liquidation value of approximately $87.0 million.
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In connection with the transaction, MDP and the members of GLDDs management that acquired securities of GLDD Acquisitions Corp. in connection with the transaction, entered into a management equity agreement, a subscription agreement and a registration rights agreement. These agreements are filed as Exhibits 10.3, 10.4 and 10.5 hereto, respectively. The parties to the management equity agreement agreed to vote all of their voting securities of GLDD Acquisitions Corp. to elect and continue in office a board of directors of GLDD Acquisitions Corp. consisting of five members composed of four persons designated by MDP and Douglas Mackie, so long as Mr. Mackie continues to serve as GLDD Acquisition Corp.s chief executive officer. The management investors also agreed to certain other voting arrangements in favor of actions taken by MDP. The management equity agreement also contains an option in favor of MDP to purchase the management investors shares in the event a management investor ceases to be employed by GLDD, tag along rights permitting the management investors to participate in certain sales by MDP of its shares, transfer restrictions, rights of first refusal in favor of MDP, limited preemptive rights in favor of the management investors, and an agreement by the management investors to vote their shares in favor of a sale of GLDD Acquisitions Corp. if approved by the board of directors, subject in each case to certain conditions. The subscription agreement contains covenants requiring GLDD Acquisitions Corp. to provide financial statements of GLDD and other information to the parties and subjecting it to certain restrictions, including with respect to the payment of dividends, incurrence of debt and certain other fundamental corporate transactions, unless otherwise agreed to by the holders of a majority of the common stock of GLDD Acquisitions Corp.
In connection with the transaction, GLDD also entered into a third amended and restated underwriting and continuing indemnity agreement with its bonding companies. This agreement is filed as Exhibit 10.6 hereto.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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GREAT LAKES DREDGE & DOCK CORPORATION |
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/s/ Deborah A. Wensel |
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Date: January 6, 2004 |
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Deborah A. Wensel |
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Senior Vice President
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Exhibit Number |
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2.1 |
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Amended and Restated Agreement and Plan of Merger dated as of December 22, 2003, among Great Lakes Dredge & Dock Corporation, GLDD Acquisitions Corp., GLDD Merger Sub, Inc. and Vectura Holding Company LLC. |
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4.1 |
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Indenture, dated as of December 22, 2003, by and among GLDD Merger Sub, Inc. and BNY Midwest Trust Company, as trustee. |
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4.2 |
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Supplemental Indenture, dated as of December 22, 2003, by and among Great Lakes Dredge & Dock Corporation, the guarantors party thereto and BNY Midwest Trust Company, as trustee. |
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10.1 |
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Credit Agreement, dated as of December 22, 2003, among GLDD Acquisitions Corp., Great Lakes Dredge & Dock Corporation, the other loan parties from time to time party thereto, the financial institutions from time to time party thereto, Lehman Brother, Inc. and Credit Suisse First Boston, acting through its Cayman Islands Branch, as Joint Advisors, Joint Lead Arrangers and Joint Book Runners, and Bank of America, N.A., as an issuer of the Letters of Credit, and as representative for the lenders. |
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10.2 |
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Credit Agreement, dated as of December 17, 2003, by and between Great Lakes Dredge & Dock Company and General Electric Capital Corporation. |
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10.3 |
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Management Equity Agreement, dated as of December 22, 2003, among GLDD Acquisitions Corp., Madison Dearborn Partners IV, L.P. and the management investors from time to time party thereto. |
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10.4 |
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Subscription Agreement, dated as of December 22, 2003, among GLDD Acquisitions Corp., Madison Dearborn Partners IV, L.P. and the other investors from time to time party thereto. |
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10.5 |
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Registration Rights Agreement, dated as of December 22, 2003, among GLDD Acquisitions Corp., Madison Dearborn Partners IV, L.P. and the other investors from time to time party thereto. |
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10.6 |
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Third Amended and Restated Underwriting and Continuing Indemnity Agreement, dated as of December 22, 2003, among Great Lakes Dredge & Dock Corporation, certain of its subsidiaries, Travelers Casualty and Surety Company and Travelers Casualty and Surety Company of America. |
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Exhibit 2.1
Execution Version
AMENDED AND
RESTATED
AGREEMENT AND PLAN OF MERGER
among
GLDD ACQUISITIONS CORP.,
GLDD MERGER SUB, INC.
and
GREAT LAKES DREDGE & DOCK CORPORATION
dated as of December 22, 2003
TABLE OF CONTENTS
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Additional Conditions to Obligations of Parent and Merger Sub. |
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Stockholder Representative; Approval of Holders of Company Common Stock. |
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EXHIBITS |
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Exhibit A |
Certificate of Merger |
Exhibit B |
Letter of Transmittal |
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Exhibit C |
Commitment Letters |
Exhibit D |
Management Term Sheet |
Exhibit E |
Form of Company Opinion of Counsel |
Exhibit F |
Form of Parent Opinion of Counsel |
Exhibit G |
Amendment |
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DEFINED TERMS
Acquisition Proposal |
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Adjustment Interest |
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Advisory Agreement |
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Affiliate |
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Aggregate Redemption Price |
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Agreement |
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Amboy Aggregates |
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Amendment |
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Arbiter |
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Asserted Liability |
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Assumed Agreements |
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Balance Sheet |
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Basket |
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Benefit Plans |
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Berardi Employment Agreement |
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Board of Directors |
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Bonding Agreement |
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Bonus Compensation Plan |
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Books and Records |
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Business Day |
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Buyer Indemnified Persons |
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Buyer Indemnifying Persons |
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Bylaws |
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Capital Expenditure Budget |
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Capitalization Side Letter |
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CERCLA |
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Certificate |
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Certificate of Incorporation |
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Certificate of Merger |
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Claims Notice |
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Class A Closing Merger Consideration |
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Class A Non-Rolling Per Share Closing Merger Consideration |
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Class B Per Share Closing Merger Consideration |
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Closing |
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Closing Common Merger Consideration |
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Closing Date |
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Closing Date Balance Sheet |
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Closing Date Debt |
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Closing Date Working Capital |
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Closing Merger Consideration |
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Closing Statement |
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Code |
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Commitment Letters |
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Common Stock Merger Consideration |
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Company |
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Company Board Approval |
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Company Class A Common Stock |
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Company Class B Common Stock |
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Company Common Stock |
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Company Disclosure Schedule |
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Company Employees |
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Company Expenses |
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Company Material Contracts |
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Company Notes |
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Company Preferred Stock |
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Company SEC Reports |
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Company Stock |
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Company Stockholders Agreement |
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Confidential Information |
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Confidentiality Agreement |
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Confidentiality Rights Agreements |
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Covered Persons |
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Credit Agreement |
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D&O Indemnified Persons |
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Damages |
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Debt |
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DGCL |
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dollars\ or \$ |
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Effective Time |
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Environmental Laws |
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Equipment Facility |
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ERISA |
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Escrow Agent |
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Escrow Fund |
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Escrow Period |
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Estimated Debt |
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Estimated Merger Expenses |
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Estimated Working Capital |
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Exchange Agent |
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Exchange Fund |
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Excluded Expenses |
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Expenses |
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External Investigation |
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Final Adjustment Amount |
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Final Closing Statement |
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Final Debt |
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Final Working Capital |
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Financing |
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First Advance Amount |
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GAAP |
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GAAP Consistently Applied |
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Government Bid |
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Government Contract |
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Governmental Authority |
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Group |
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Holdback Adjustment Amount |
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Holdback Consideration |
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HSR Act |
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Hydro Dump Barge |
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Indemnification Period |
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Indemnified Persons |
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Indemnifying Persons |
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Indenture |
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Intellectual Property |
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Internal Investigation |
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Knowledge of Parent |
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Knowledge of the Company |
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Lease |
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Leased Real Property |
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Letter of Transmittal |
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Liabilities |
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Licenses and Permits |
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Liens |
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Listing |
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Material Adverse Effect |
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Materials of Environmental Concern |
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Maximum Amount |
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McAllister Purchase Agreement |
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Merger |
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Merger Consideration |
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Merger Sub |
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NASDI Stockholders Agreement |
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Notice of Disagreement |
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Offering Materials |
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Offerings |
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Operating Leases |
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Owned Real Property |
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Parent |
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Parent Officers Certificate |
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Per Share Holdback Consideration |
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Per Share Merger Consideration |
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Permitted Investments |
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Permitted Liens |
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Person |
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Preferred Allocation Certificate |
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Preferred Per Share Merger Consideration |
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Preferred Stock Merger Consideration |
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Prior Period Returns |
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Proceeding |
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Purchase Price Adjustment Statement |
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Purchase Price Adjustment Notice |
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Real Property Encumbrances |
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Reference Amount |
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Release |
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Remaining Holdback Consideration |
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Required Company Vote |
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SEC |
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Second Advance Amount |
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Seller Indemnified Persons |
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Seller Indemnifying Person |
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Senior Managers |
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Stockholder Representative |
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Straddle Period |
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Straddle Period Return |
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Subsidiary |
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Surviving Corporation |
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Tax Benefit |
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Tax Return |
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Taxes |
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Termination Date |
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the other party |
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Threshold |
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Transaction Tax Benefits |
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Transfer Tax Liabilities |
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Tug Sale Proceeds |
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Tug Sale Proceeds Shortfall Amount |
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Violation |
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Working Capital |
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Written Consent |
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AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
THIS AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated as of December 22, 2003 (this Agreement ), among GLDD Acquisitions Corp., a Delaware corporation ( Parent ), GLDD Merger Sub, Inc., a Delaware corporation and a direct wholly-owned subsidiary of Parent ( Merger Sub ), Great Lakes Dredge & Dock Corporation, a Delaware corporation (the Company ) and, solely in its capacity as Stockholder Representative hereunder and for purposes of Sections 2.9, 2.10, 2.11, Article VIII and Article IX hereof, Vectura Holding Company LLC.
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has determined that it is advisable and in the best interests of the Company and its stockholders, and consistent with and in furtherance of its business strategies and goals, for Parent to acquire all of the outstanding shares of the Company through the merger of Merger Sub with and into the Company (the Merger ) in accordance with the applicable provisions of the Delaware General Corporation Law (the DGCL ) and upon the terms and subject to the conditions set forth herein;
WHEREAS, the Board of Directors of Parent and Merger Sub have each approved and declared advisable the transactions contemplated by this Agreement;
WHEREAS, in furtherance of such combination, the Boards of Directors of Parent, Merger Sub and the Company have each adopted this Agreement providing for the Merger and the Board of Directors of the Company has resolved to recommend that the holders of the Company Class A Common Stock vote to adopt this Agreement providing for the Merger upon the terms and subject to the conditions contained herein
WHEREAS, (i) holders of all of the outstanding Company Class A Common Stock have executed and delivered to the Company on or prior to November 12, 2003 a valid written consent approving the Merger (the Written Consent ), (ii) the holders of a majority of voting capital stock of Parent have executed and delivered to Parent on or prior to November 12, 2003 a valid written consent approving the Merger and (iii) Parent, as the holder of all of the outstanding shares of common stock of Merger Sub, has executed and delivered to Buyer on or prior to November 12, 2003 a valid written consent approving the Merger;
WHEREAS, immediately prior to consummation of the Merger and as an integral part of the transactions contemplated hereby, certain holders of Company Stock that are employees of the Company and listed on the Schedule I attached hereto (such schedule, the Schedule of Rollover Participants and each such participant a Rollover Participant and collectively such participants, the Rollover Participants ) shall contribute to Parent the number of shares of Company Class A Common Stock (as hereinafter defined) set forth opposite such
Persons name on the Schedule of Rollover Participants attached hereto under the caption Rollover Shares (the Rollover Shares ) and in exchange therefor, each Rollover Participant shall receive from Parent immediately prior to consummation of the Merger the number of shares of Parent Common Stock and/or Parent Preferred Stock (each as hereinafter defined) set forth opposite such Rollover Participants name on the Schedule of Rollover Participants under the caption Parent Shares, on the terms and subject to the conditions set forth herein, which contribution and exchange will occur in connection with the formation of Parent and is intended to qualify as a Code Section 351 transaction ;
WHEREAS, pursuant to the Merger, each outstanding share of (i) Class A Common Stock, par value $.01 per share, of the Company (the Company Class A Common Stock ) and (ii) Class B Common Stock, par value $.01 per share, of the Company (the Company Class B Common Stock and, collectively with the Company Class A Common Stock, the Company Common Stock ), issued and outstanding immediately prior to the Effective Time (as defined in Section 1.3), other than (x) Rollover Common Shares (as hereinafter defined) and (y) other shares owned or held directly or indirectly by the Parent, Merger Sub or their respective Subsidiaries or the Company or its Subsidiaries, will be converted into the right to receive (1) in the case of the holders of Company Class A Common Stock, the Class A Non-Rolling Per Share Closing Merger Consideration (as defined herein) and the Class A Per Share Holdback Consideration (as defined herein), and (2) in the case of all holders of Company Class B Common Stock, the Class B Per Share Closing Merger Consideration (as defined herein) and the Class B Per Share Holdback Consideration (as defined herein);
WHEREAS, pursuant to the Merger, each outstanding share of 12% Series A Cumulative Compounding Preferred Stock, par value $.01 per share, of the Company (the Company Preferred Stock and, collectively with the Company Common Stock, the Company Stock ), issued and outstanding immediately prior to the Effective Time, other than shares of Company Preferred Stock owned or held directly or indirectly by Parent, Merger Sub or their respective Subsidiaries or the Company or its Subsidiaries, will be converted into the right to receive an amount in cash equal to the Preferred Per Share Merger Consideration;
WHEREAS, the Holdback Consideration shall be placed in escrow for purposes of (i) satisfying damages, losses, expenses and other similar charges which result from breaches of the representations and warranties and covenants of the Company and (ii) the adjustment to the Common Stock Merger Consideration;
WHEREAS, Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with the transactions contemplated hereby and also to prescribe various conditions to the transactions contemplated hereby; and
WHEREAS, this Agreement amends and restates in its entirety that certain Agreement and Plan of Merger, dated as of November 12, 2003, by and among the parties hereto (the Prior Agreement ).
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NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth herein, and intending to be legally bound hereby, the parties hereto agree as follows:
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(ii) At the Effective Time, Parent shall deposit and/or shall cause the proceeds of any financing to, or any cash of, the Surviving Corporation and its Subsidiaries to be deposited (A) with the Exchange Agent in trust for the benefit of holders of shares of Company Stock, an aggregate amount equal to the Closing Merger Consideration less the Stockholder Representative Closing Merger Consideration (as defined below) and (B) with the Escrow Agent an aggregate amount equal to the Holdback Consideration. Any cash deposited with the Exchange Agent in trust for the benefit of holders of shares of Company Stock shall hereinafter be referred to as the Exchange Fund . The Parent shall also deliver to the Exchange Agent as soon as possible after the Effective Time a list (the Schedule of Stockholder Closing Merger Consideration ) of holders of Company Stock as of immediately prior to the Effective Time approved by the Company (after giving effect to the Management Rollover Transaction) and the amount to be paid in cash to such holder in respect of the Company Stock so delivered; provided that such Schedule of Stockholder Closing Merger Consideration shall not contain reference to the portion of the Closing Merger Consideration paid to the Stockholder Representative in its capacity as a holder of Company Stock (with it being understood that no payments from the Exchange Fund shall be made to the Stockholder Representative or any of its designees by the Exchange Agent except to the extent that such designee owns shares directly in the Company as of immediately prior to the Closing) and the Exchange Agent shall be entitled to rely on such list exclusively in distributing the Closing Merger Consideration in the Exchange Fund.
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During the 15-day period following the delivery of a Notice of Disagreement that complies with the preceding paragraph or such longer period as the Stockholder Representative and Parent shall mutually agree, the Stockholder Representative and Parent shall seek in good faith to resolve in writing any differences that they may have with respect to the matters specified in the Notice of Disagreement, and in the event the Stockholder Representative and Parent are able to reach such resolution then the amount so agreed by them in writing shall be deemed to be Closing Date Working Capital and/or the Closing Date Debt, as the case may be. If, at the end of such 15-day period (or such longer period as mutually agreed between the Stockholder Representative and Parent), the Stockholder Representative and Parent have not so resolved such differences, the Stockholder Representative and Parent shall submit the dispute for resolution to an independent accounting firm (the Arbiter ) for review and resolution of any and all matters which remain in dispute and which were properly included in the Notice of Disagreement in accordance with this Section 2.10. The Arbiter shall be a mutually acceptable internationally recognized independent public accounting firm agreed upon by the Stockholder Representative and Parent in writing; provided , that in the event the parties are not able to mutually agree on an accounting firm, the Arbiter shall be Pricewaterhouse Coopers LLP. The Stockholder Representative and Parent shall use reasonable efforts to cause the Arbiter to render a decision resolving the matters in dispute within 30 days following the submission of such matters to the Arbiter, or such longer period as the Stockholder Representative and Parent shall mutually agree. The Stockholder Representative and Parent agree that the determination of the Arbiter shall be final and binding upon the parties and that judgment may be entered upon the determination of the Arbiter in any court having jurisdiction over the party against which such determination is to be enforced; provided , that the scope of the disputes to be resolved by the Arbiter is limited to only such items included in the Closing Statement that the Stockholder Representative has disputed in the Notice of Disagreement. The Arbiter shall determine, based solely on presentations by Parent and the Stockholder Representative and their respective representatives, and not by independent review, only those issues in dispute specifically set forth on the Notice of Disagreement and shall prepare the Final Closing Statement and render a written report as to the dispute and the resulting calculation of Closing Date Working Capital and/or Closing Date Debt, as appropriate, which shall be conclusive and binding upon the parties. In resolving any disputed item, the Arbiter: (i) shall be bound by the principles set forth in Section 2.10 hereof, (ii) shall limit its review to matters specifically set forth in the Notice of Disagreement and (iii) shall not assign a value to any item greater than the greatest value for such item claimed by either party or less than the smallest value for such item claimed by either party. The fees, costs, and expenses of the Arbiter (x) shall be borne by the holders of Company Common Stock as of immediately prior to consummation of the Merger in the proportion that the aggregate dollar amount of such disputed items so submitted that are unsuccessfully disputed by
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the Stockholder Representative (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted and (y) shall be borne by Parent in the proportion that the aggregate dollar amount of such disputed items so submitted that are successfully disputed by the Stockholder Representative (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted. Whether any dispute is resolved by agreement among the parties or by the Arbiter, changes to the Closing Statement shall be made hereunder only for items as to which Parent has taken exception in the Notice of Disagreement. The fees and expenses of Parent incurred in connection with the preparation of the Closing Statement and review of any Notice of Disagreement shall be borne by Parent, and the fees and expenses of the Stockholder Representatives independent accountants incurred in connection with their review of the Closing Statement shall be borne by the holders of Company Common Stock.
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(2) The Company and its Subsidiaries have furnished, or prior to Closing will make available, to Parent all material environmental audits, reports and other material environmental documents relating to its past or current properties, facilities or operations which were prepared on their behalf or are in their possession or under their reasonable control.
(3) Notwithstanding any other representations and warranties in this Agreement, the representations and warranties in this Agreement with respect to matters relating to compliance with or liability under Environmental Laws or to Releases of, contamination by or exposure to Materials of Environmental Concern are set forth in this Section 3.1(q).
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Notwithstanding anything in this Section 4.1 or elsewhere in this Agreement to the contrary, the parties acknowledge that the Company and/or one or more of its Subsidiaries is party to contracts or arrangements, or desire to sell or write off the value of, certain fixed assets, other assets and Owned Property of the Company and its Subsidiaries or may settle or receive judgment with respect to certain claims regarding contracts to which the Company or one or more of its Subsidiaries is party or for services performed by the Company and its Subsidiaries and that all cash or other assets generated from any sales or write off of any fixed assets, other assets and/or Owned Property or from settlement or resolution of any claims or counterclaims brought by the Company or any of its Subsidiaries since September 30, 2003 is exclusively for the benefit of Parent and the Surviving Corporation and that, except for cash generated from the asset sales and settlements to the extent set forth on Section 4.1(b) of the Company Disclosure Schedule, such cash has not been and shall not be used by the Company or any of its Subsidiaries at any time from and after September 30, 2003 or on or prior to Closing, either directly or indirectly, to pay any Debt or any other liability, obligation or expense of the Company and/or any of its Subsidiaries.
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(c) The Company shall, and shall cause each of its Subsidiaries to, use commercially reasonable efforts to cooperate with and assist, and shall use commercially reasonable efforts to cause the independent accountants for the Company and its Subsidiaries (including, for the avoidance of doubt, Amboy Aggregates) , to cooperate and assist, Parent in preparing such information packages and offering materials as the parties to the Commitment Letters may reasonably request (collectively, the Offering Materials ) for use in connection with the offering and/or syndications of debt securities, loan participations and other matters contemplated by the Commitment Letters (the Offerings ), including, without limitation, (i) making senior management and other representatives of the Company and its Subsidiaries available (at mutually agreeable times) to participate in meetings with prospective investors, participating in road shows in connection with any such Offerings and participating in meetings with rating agencies and causing the present and former independent accountants for the Company and its Subsidiaries (including, for the avoidance of doubt, Amboy Aggregates) to participate in drafting sessions related to the preparation of the Offering Materials and making work papers available to the Parent, the underwriters and their respective representatives ; (ii) delivering comfort-letters in customary form in connection with any Offering; (iii) delivering consents to the inclusion of financial statements required in connection with any Offering registered under the Securities Act; and (iv) providing such information and assistance as the parties to such Commitment Letters may reasonably request in connection therewith.
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(f) Calculation of Tax Indemnity . Notwithstanding anything to the contrary contained in Sections 5.4(b), 5.4(c) and 8.2, (i) the Buyer Indemnifying Persons shall not be required to indemnify the Buyer Indemnified Persons under Section 8.2 for any Tax to the extent that a specific item of reserve was established for such Tax and was included as a consolidated current liability in the calculation of Closing Working Capital, (ii) holders of Company Common Stock shall not be required to pay any Tax under Section 5.4 (b) and (c) to the extent that a specific item of reserve was established for such Tax and was included as a consolidated current liability in the calculation of Closing Working Capital, and (iii) the Buyer Indemnifying Persons shall not be required to indemnify the Buyer Indemnified Persons under Section 8.2, and the holders of Company Common Stock shall not be required to pay under Section 5.4(b) or (c), any withholding Taxes paid with respect to payments under the Bonus Compensation Plan to the extent that such Taxes are treated (as it is intended, for avoidance of doubt, that they be treated) as part of Debt for purposes of calculating the Merger Consideration.
(g) Arbiter Costs . The fees, costs, and expenses of the Arbiter under Sections 5.2(b) and 5.2(c) (x) shall be borne by the holders of Company Common Stock as of immediately prior to consummation of the Merger in the proportion that the aggregate dollar amount of such disputed items so submitted that are unsuccessfully disputed by the Stockholder Representative (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted and (y) shall be borne by Parent in the proportion that the aggregate dollar amount of such disputed items so submitted that are successfully disputed by the Stockholder Representative (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted.
Whether or not the Merger is consummated, except as otherwise provided herein, all Expenses (as defined below) incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such Expenses, except if the Merger is consummated, the Company shall pay, or cause to be paid, any and all property or transfer taxes imposed on the Company or its Subsidiaries (collectively, Transfer Tax Liabilities ). As used in this Agreement, Expenses includes all out-of-pocket expenses (including all fees and expenses of counsel, accountants, investment bankers, experts and consultants to a party hereto and its affiliates) incurred by a party or on its behalf in connection with or related to the authorization, preparation, negotiation, execution and performance of this Agreement and the transactions contemplated hereby, including the preparation of any filing required by the HSR Act and all matters related to the transactions contemplated hereby.
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provided , however , that the maximum liability of the Buyer Indemnifying Persons as a group for Damages in respect of any claim or claims for indemnification under Article VIII shall not exceed the amount of the Holdback Consideration as of the Closing Date (the Maximum Amount ); provided , further , that in no event will the Buyer Indemnifying Persons be liable to any Buyer Indemnified Person in respect of any claim for any indemnification under Section 8.2(a)(i) and Section 8.2(a)(ii) unless any individual Damage or series of related Damages exceeds $25,000 (the Threshold ) and the cumulative total of the Damages suffered by the Buyer Indemnifying Persons exceeds $5,000,000 (the Basket ), whereupon the Buyer Indemnified Persons shall be entitled to indemnification of all Damages, including the initial $5,000,000, regardless of whether the Threshold has been exceeded. Notwithstanding anything to the contrary set forth in this Agreement, in no event shall any Damages arising from breach of representations and warranties made in Section 3.1(c), Section 3.1(d)(i) or Section 3.1(m) or any claim for indemnification under Section 8.2(a)(iii) or Section 8.2(a)(iv) be subject to the Threshold or the Basket and the Buyer Indemnified Persons shall be entitled to recover for Damages from any such breach without regard to the Threshold or the Basket. For the avoidance of doubt, it is understood that Damages shall not include punitive, special, consequential or other similar damages, diminution in value or lost profits; provided , however that Damages shall include punitive, special, consequential or other similar damages, diminution in value or lost profits payable by Buyer Indemnified Persons to third parties.
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provided , however , that the Seller Indemnifying Persons as a group shall not have any liability for Damages pursuant to this Article VIII for any amounts in excess of the Maximum Amount; provided , further , that in no event will the Seller Indemnifying Persons be liable to any Seller Indemnified Person under Section 8.2(b)(i) or Section 8.2(b)(ii) for Damages unless any individual Damage or series of related Damages exceeds the Threshold and the cumulative total of the Damages suffered by the Seller Indemnifying Persons exceeds the Basket, whereupon the Seller Indemnified Persons shall be entitled to indemnification of all Damages, including the initial $5,000,000, regardless of whether the Threshold has been exceeded.
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c/o Madison Dearborn Partners, LLC
Three First National Plaza
70 W. Madison, Suite 3800
Chicago, IL 60602
Fax: (312) 895-1100
Attention: Samuel M. Mencoff
Thomas S. Souleles
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with a copy to:
Kirkland & Ellis LLP
200 E. Randolph Dr.
Chicago, IL 60601
Fax: (312) 861-2200
Attention: William S. Kirsch, P.C.
Great Lakes Dredge & Dock Corporation
2122 York Road
Oak Brook, IL 60523
Fax: (630) 574-2909
Attention: Chief Executive Officer
with a copy to:
Vectura Holding Company LLC
399 Park Avenue
New York, New York 10043
Fax: (212) 888-2940
Attention: Michael A. Delaney
with a copy to:
Dechert LLP
4000 Bell Atlantic Tower
1717 Arch Street
Philadelphia, Pennsylvania
Fax: (215) 994-2222
Attention: John D. LaRocca, Esq.
Vectura Holding Company LLC
399 Park Avenue
New York, New York 10043
Fax: (212) 888-2940
Attention: Michael A. Delaney
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with a copy to:
Dechert LLP
4000 Bell Atlantic Tower
1717 Arch Street
Philadelphia, Pennsylvania
Fax: (215) 994-2222
Attention: John D. LaRocca, Esq.
J.P. Morgan Trust Company
55 W. Monroe Street, 15 th Floor
Chicago, IL 60670
Fax: (312) 336-2649
Attention: Timothy P. Martin
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GLDD Merger Sub, Inc. |
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Great Lakes Dredge & Dock Corporation |
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Vectura Holding Company LLC |
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COUNTERPART SIGNATURE
PAGE TO
AMENDED AND RESTATED MERGER AGREEMENT
IN WITNESS WHEREOF, the undersigned, solely in its capacity as the Escrow Agent and the Exchange Agent, has duly executed this Agreement as of the day and year first written above.
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J.P. Morgan Trust Company,
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Timothy P. Martin |
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Exhibit 4.1
EXECUTION VERSION
GLDD MERGER SUB, INC.
to be merged with and into
GREAT LAKES DREDGE & DOCK CORPORATION
$175,000,000
7¾% Senior Subordinated Notes due 2013
INDENTURE
Dated as of December 22, 2003
BNY Midwest Trust Company,
as Trustee
This INDENTURE, dated as of December 22, 2003, is by and among GLDD Merger Sub, Inc., a Delaware corporation, to be merged with and into Great Lakes Dredge & Dock Corporation, a Delaware corporation, the Guarantors from time to time party hereto and BNY Midwest Trust Company, an Illinois trust company, as trustee (the Trustee ).
The Company, each Subsidiary Guarantor and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the 7¾% Senior Subordinated Notes due 2013 (the Notes ) issued under this Indenture:
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS .
For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:
144A Global Note means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that shall be issued in a denomination equal to the outstanding principal amount of the Notes sold for initial resale in reliance on Rule 144A.
Acquired Debt means, with respect to any specified Person, (i) Indebtedness of any other Person existing at the time the other Person is merged with or into or became a Subsidiary of the specified Person, including, without limitation, Indebtedness incurred in connection with, or in contemplation of, the other Person merging with or into or becoming a Subsidiary of the specified Person, and (ii) Indebtedness secured by a Lien encumbering any asset acquired by the specified Person
Additional Notes means any Notes (other than Initial Notes, Exchange Notes and Notes issued under Sections 2.06, 2.07, 2.10 and 3.06 hereof) issued under this Indenture in accordance with Sections 2.02, 2.15 and 4.09 hereof, as part of the same series as the Initial Notes or as an additional series.
Agent means any Registrar, co-registrar, Paying Agent or additional paying agent.
Affiliate of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with the specified Person. For purposes of this definition, control (including, with correlative meanings, the terms controlling , controlled by and under common control with ) , as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that Beneficial Ownership of 10% or more of the Voting Stock of a Person shall be deemed to be control.
Applicable Procedures means, with respect to any transfer, redemption or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer, redemption or exchange.
Asset Sale means
(i) the sale, lease, conveyance or other disposition of any assets or rights (including, without limitation, by way of a sale and leaseback) other than sales of inventory in the ordinary course of business consistent with past practices (provided that the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole, will be governed by Section 4.18 and/or Section 5.01 and not by Section 4.12), and
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(ii) the issue or sale by any Restricted Subsidiary of Equity Interests of any of the Companys Subsidiaries,
in the case of either clause (i) or (ii), whether in a single transaction or a series of related transactions (a) that involve assets or Equity Interests that have a fair market value in excess of $2.0 million or (b) for net proceeds in excess of $2.0 million.
Notwithstanding the foregoing, the following items shall not be deemed to be Asset Sales:
(i) a transfer of assets by the Company to a Restricted Subsidiary or by a Restricted Subsidiary to the Company or to another Restricted Subsidiary,
(ii) an issuance, sale, transfer or other disposition of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary,
(iii) a Restricted Payment that is permitted by Section 4.10 or a Permitted Investment,
(iv) the sale and leaseback of any assets within 180 days of the date of acquisition or completion of construction of such assets,
(v) the sale or other disposition of assets that have become worn out, obsolete or damaged or no longer used or useful in the business of the Company or any Restricted Subsidiary, as the case may be, in the ordinary course of business,
(vi) bare-boat charters, leases or licenses entered into in the ordinary course of business for a term not to exceed 12 months,
(vii) the sale or other disposition of cash or Cash Equivalents,
(viii) the sale or lease of products or services or the licensing of intellectual property, in each case in the ordinary course of business, and
(ix) the sale for fair market value (as determined by the Companys chief financial officer, as set forth in an Officers Certificate to the Trustee if such fair market value exceeds $2.0 million) of accounts receivable that are generated from operations conducted outside the United States by the Company or any Restricted Subsidiary.
Bankruptcy Law means Title 11, United States Code or any similar federal or state law for the relief of debtors, or the law of any other jurisdiction relating to bankruptcy, insolvency, winding up, liquidation, reorganization or relief of debtors.
Beneficial Owner has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular person (as such term is used in Section 13(d)(3) of the Exchange Act), such person shall be deemed to have beneficial ownership of all securities that such person has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition.
Board of Directors means (1) in respect of a corporation, the board of directors of the corporation, or any duly authorized committee thereof; and (2) in respect of any other Person, the board or committee of that Person serving an equivalent function.
Board Resolution means a copy of a resolution certified by the secretary or an assistant secretary (or individual performing comparable duties) of the applicable Person to have been duly adopted by the Board of Directors of such Person and to be in full force and effect on the date of such certification, and delivered to the Trustee.
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Bonding Agreement means the Third Amended and Restated Underwriting and Continuing Indemnity Agreement, dated December 22, 2003, by and among the Company, certain of its Subsidiaries, Travelers Casualty and Surety Company and Travelers Casualty and Surety Company of America, including any related notes, guarantees, collateral documents, instruments and agreements executed in connection therewith, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.
Business Day means any day other than a Legal Holiday.
Capital Lease Obligation means, at the time any determination of a capital lease obligation is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized on a balance sheet in accordance with GAAP.
Capital Stock means
(i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock,
(iii) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited) and
(iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.
Cash Equivalents means:
(i) United States dollars or money in other currencies received in the ordinary course of business,
(ii) obligations issued or guaranteed by the United States government or any agency of the United States ( provided that the full faith and credit of the United States is pledged in support) having maturities of not more than one year from the date of acquisition,
(iii) certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers acceptances with maturities not exceeding one year and overnight bank deposits, in each case with any commercial bank having capital and surplus in excess of $500 million,
(iv) repurchase obligations with a term of not more than thirty days for underlying securities of the types described in clauses (ii) and (iii) above entered into with any institution meeting the qualifications specified in clause (iii) above,
(v) obligations issued by any state of the United States of America or any political subdivision of any such state maturing within one year from the date of acquisition and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moodys,
(vi) commercial paper having one of the two highest ratings obtainable from Moodys or S&P and in each case maturing within one year after the date of acquisition,
(vii) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (i) through (vi) of this definition,
(viii) short-term asset management accounts offered by any lender under Credit Facilities for the purpose of investing in notes issued by a corporation (other than the Company or any Affiliate of the Company)
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organized under the laws of any state of the United States or of the District of Columbia and rated A-2 or higher by S&P, or P-2 or higher by Moodys,
(ix) securities with maturities of one year or less from the date of acquisition issued or fully and unconditionally guaranteed by any state, commonwealth or territory of the United States of America or the federal government of Canada, or by any political subdivision or taxing authority thereof, and having one of the two highest ratings obtainable from S&P or Moodys,
(x) time or demand deposits with any bank or trust company,
(xi) participation in loans made to a borrower (other than an Affiliate of the Company) with a debt rating of A-2 or higher from S&P, or P-2 or higher from Moodys; provided , however , that such loans must mature within one year from the date such participation is purchased,
(xii) bonds issued by a municipality or governmental agency and rated not lower than BBB by S&P, or Baa2 by Moodys and purchased by the Company or any of its Subsidiaries in the ordinary course of its business in connection with retainage under contracts with its customers, and
(xiii) in the case of foreign Subsidiaries, short term investments comparable to the foregoing.
Change of Control means the occurrence of any of the following:
(i) the sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Company and its Subsidiaries (determined on a consolidated basis), in each case, to any person (as that term is used in Section 13(d)(3) of the Exchange Act) other than the Company or a Wholly Owned Restricted Subsidiary or any Principal or a Related Party of a Principal,
(ii) the adoption of a plan relating to the liquidation or dissolution of the Company (other than in a transaction which complies with the provisions described under Section 5.01,
(iii) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any person (as defined above), other than one or more Principals or their Related Parties, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Company (measured by voting power rather than number of shares), or
(iv) the first day on which a majority of the members of the Board of Directors of the Company are not Continuing Directors.
Clearstream means Clearstream Banking S.A. and any successor thereto.
Code means the U.S. Internal Revenue Code of 1986, as amended.
Commission means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, as amended, or if at any time after the execution and delivery of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties on such date.
Company means GLDD Merger Sub, Inc., and, upon consummation of the transactions contemplated by the Merger Agreement, Great Lakes Dredge & Dock Corporation, and any successor thereto.
Consolidated Cash Flow means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period, plus
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(i) an amount equal to any extraordinary or nonrecurring loss (including any loss on extinguishment or conversion of Indebtedness) plus any net loss realized in connection with an Asset Sale (without giving effect to the $2.0 million threshold provided in the definition thereof), to the extent those losses were deducted in computing the Consolidated Net Income, plus
(ii) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing the Consolidated Net Income, plus
(iii) consolidated Fixed Charges to the extent that any such Fixed Charges were deducted in computing the Consolidated Net Income, plus
(iv) depreciation, amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash items (excluding any non-cash item to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash items were deducted in computing the Consolidated Net Income, plus
(v) the amount of any minority interest expense attributable to the 15% equity interest of NASDI not owned by the Company to the extent deducted in computing Consolidated Net Income for so long as the intercompany note between the Company and NASDI shall be in effect, minus
(vi) non-cash items increasing the Consolidated Net Income for such period other than (i) accrual of revenue in the ordinary course of business and (ii) reversals of prior accruals or reserves for cash items previously excluded from Consolidated Cash Flow pursuant to clause (iv) of this definition,
in each case, on a consolidated basis and determined in accordance with GAAP.
Consolidated Leverage Ratio as of any date of determination means, the ratio of (x) consolidated Indebtedness of the Company and its Restricted Subsidiaries as of the end of the most recent fiscal quarter for which internal financial statements are available to (y) the aggregate amount of Consolidated Cash Flow of the Company and its Restricted Subsidiaries for the period of the most recent four consecutive quarters for which internal financial statements are available, in each case with such pro forma adjustments to consolidated Indebtedness and Consolidated Cash Flow as are appropriate and consistent with the pro forma provisions set forth in the definition of Fixed Charge Coverage Ratio.
Consolidated Net Income means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that
(i) the Net Income of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting shall be included only to the extent of the amount of dividends or distributions paid in cash to the referent Person or its Restricted Subsidiary;
(ii) the Net Income of any Restricted Subsidiary shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders;
(iii) the Net Income of any Person acquired in a pooling of interests transaction for any period prior to the date of such acquisition shall be excluded;
(iv) the cumulative effect of a change in accounting principles shall be excluded,
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(v) the Net Income of any Unrestricted Subsidiary shall be excluded, whether or not distributed to the Company or one of its Subsidiaries,
(vi) any non-cash goodwill or other intangible asset impairment charges incurred subsequent to the date of this Indenture resulting from the application of SFAS No. 142 shall be excluded;
(vii) any non-cash compensation charges, including any such charges arising from stock options, restricted stock grants or other equity-incentive programs shall be excluded;
(viii) the charge related to the impairment of the land use rights pertaining to the Companys disposal sites in New Jersey shall be excluded; and
(ix) any increase in amortization or depreciation expense or any one-time non-cash charges resulting from purchase accounting or any non-recurring costs and expenses incurred in connection with the Transactions or any acquisition that is consummated after the date of this Indenture shall be excluded.
Continuing Directors means, as of any date of determination, any member of the Board of Directors of the Company who (i) was a member of the Board of Directors on the date of this Indenture and after giving effect to the acquisition of Great Lakes Dredge & Dock Corporation pursuant to the Merger Agreement or (ii) was nominated for election or elected to the Board of Directors with the approval of a majority of the Continuing Directors who were members of the Board at the time of the nomination or election or was otherwise designated by a Principal or a Related Party of a Principal.
Corporate Trust Office of the Trustee shall be at the address of the Trustee specified in Section 13.02 hereof, or such other address as to which the Trustee may give notice to the Company.
Credit Facilities means, with respect to the Company or its Restricted Subsidiaries, one or more debt facilities (including, without limitation, the New Credit Facility) or commercial paper facilities or indentures with banks or other institutional lenders or a trustee providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit or issuance of debt securities to institutional investors, in each case, as increased as permitted by the terms of this Indenture, and amended, restated, modified, renewed, refunded, replaced, restated, substituted or refinanced in whole or in part from time to time.
Custodian means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03(c) as Custodian with respect to the Notes, and any and all successors thereto appointed as custodian hereunder and having become such pursuant to the applicable provisions of this Indenture.
Default means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.
Definitive Note means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 or 2.10 hereof, in substantially the form of Exhibit A hereto, except that such Note shall not bear the Global Note Legend and shall not have the Schedule of Exchanges of Interests in the Global Note attached thereto.
Depositary means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03(b) hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provisions of this Indenture.
Designated Noncash Consideration means any non-cash consideration received by the Company or one of its Restricted Subsidiaries in connection with an Asset Sale that is designated as Designated Noncash Consideration pursuant to an Officers Certificate executed by the Chief Financial Officer of the Company. Such Officers Certificate shall state the basis of such valuation. A particular item of Designated Noncash
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Consideration shall no longer be considered to be outstanding to the extent it has been sold or liquidated for cash (but only to the extent of the cash received).
Designated Senior Debt means
(i) any Obligations outstanding under the New Credit Facility (including letters of credit),
(ii) any Permitted Bonding Obligation and
(iii) any other Senior Debt permitted under this Indenture the principal amount of which is $25.0 million or more and that has been designated by the Company as Designated Senior Debt. Notwithstanding the foregoing, Indebtedness under the New Credit Facility shall be deemed outstanding for purposes of this definition at all times when the lenders thereunder have an effective commitment to extend credit thereunder, regardless of whether any such Indebtedness is actually outstanding at that time.
Designated Vessels means the dredge New York, the dredge Victoria Island, the BTS-401 and BTS-402 Scows, the Bottom-Dump Barges G.L.61, G.L.62 and G.L.65, the dredge Texas and the dredge Pontchartrain and ancillary equipment related thereto.
Disqualified Stock means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, at the option of the holder), or upon the happening of any event (other than optional redemption by the Company thereof), matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature; provided , however , that any Capital Stock that would constitute Disqualified Stock solely because the holders have the right to require the Company to repurchase the Capital Stock upon the occurrence of a Change of Control or an Asset Sale shall not constitute Disqualified Stock if the terms of the Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless the repurchase or redemption complies with Section 4.10
Distribution Compliance Period means the 40-day distribution compliance period as defined in Regulation S.
Domestic Subsidiary means any Restricted Subsidiary of the Company that was formed under the laws of the United States or any state of the United States or the District of Columbia.
Equipment Financing Facility means that credit agreement, dated December 17, 2003, by and between Great Lakes Dredge & Dock Company and General Electric Capital Corporation, providing for up to $23.4 million of term borrowings.
Equity Interests means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).
Equity Offering means a public or private offering or sale of Equity Interests (other than Disqualified Stock) of the Company or a direct or indirect parent of the Company (so long as the net proceeds thereof are contributed to the common equity capital of the Company).
Euroclear means Euroclear Bank, S.A./N.V., as operator of the Euroclear systems, and any successor thereto.
Exchange Act means the Securities Exchange Act of 1934, as amended.
Exchange Notes means new Notes of the Company issued in the Exchange Offer, provided that such new Notes have terms substantially identical in all material respects to the Notes (except that Exchange Notes will not contain terms with respect to transfer restrictions) for which such offer is being made.
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Exchange Offer means the registration by the Company under the Securities Act of the Exchange Notes pursuant to a Registration Statement pursuant to which the Company offers the holders of all outstanding Transfer Restricted Securities (as defined in the Registration Rights Agreement) the opportunity to exchange all such outstanding Transfer Restricted Securities held by such holders for Exchange Notes in an aggregate principal amount equal to the aggregate principal amount of the Transfer Restricted Securities validly tendered in such exchange offer by such holders.
Exchange Offer Registration Statement has the meaning set forth in a Registration Rights Agreement.
Excluded Contribution means the net cash proceeds received by the Company after the date of this Indenture from (a) contributions to its common equity capital and (b) the sale (other than to a Subsidiary or pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Company or any of its Subsidiaries) of Capital Stock (other than Disqualified Stock) of the Company, in each case designated within 60 days of the receipt of such net cash proceeds as Excluded Contributions pursuant to an Officers Certificate, the cash proceeds of which are excluded from the calculation set forth in clause (iv)(c)(iii) of the first paragraph of Section 4.10
Existing Indebtedness means Indebtedness (including Guarantees) of the Company and its Subsidiaries (other than Indebtedness under the New Credit Facility) in existence on the date of this Indenture (after giving effect to the transactions contemplated by the Merger Agreement), until permanently repaid.
Fixed Charges means, with respect to any Person for any period, the sum, without duplication, of
(i) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued (including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers acceptance financings, and net payments (if any) pursuant to interest rate Hedging Obligations (but excluding the amortization or write-off of financing fees in connection with the Transactions), net of interest income of such Person and its Restricted Subsidiaries for such period, and
(ii) the consolidated interest of such Person and its Restricted Subsidiaries that was capitalized during such period, and
(iii) any interest expense on Indebtedness of another Person that is Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries (whether or not the Guarantee or Lien is called upon), and
(iv) the product of (a) all cash dividend payments and non-cash dividend payments on any series of preferred stock and any series of Disqualified Stock, in each case, of such Person or any of its Restricted Subsidiaries, other than dividend payments (x) on Equity Interests payable solely in Equity Interests of the Company (other than Disqualified Stock) or (y) to the Company or a Subsidiary Guarantor, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP.
Fixed Charge Coverage Ratio means with respect to any Person for any period, the ratio of the Consolidated Cash Flow to the Fixed Charges of such Person for such period. In the event that the referent Person or any of its Restricted Subsidiaries incurs, assumes, Guarantees, repays or redeems any Indebtedness (other than repayment of revolving credit borrowings that are not accompanied by a permanent reduction in the commitment amount) or issues or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the Calculation Date ), then the Fixed Charge Coverage Ratio shall be
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calculated giving pro forma effect to such incurrence, assumption, Guarantee or redemption of Indebtedness, or such issuance or redemption of preferred stock, as if the same had occurred at the beginning of the applicable four-quarter reference period. In addition, for purposes of making the computation referred to above,
(i) acquisitions and dispositions that have been made by the Company or any of its Restricted Subsidiaries, including through mergers (including the acquisition described in the Offering Memorandum) or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date shall be given pro forma effect as if they occurred on the first day of the four-quarter reference period in accordance with Regulation S-X under the Securities Act and Consolidated Cash Flow for such reference period shall be calculated without giving effect to clause (iii) of the proviso set forth in the definition of Consolidated Net Income and, in connection with any acquisition (including the acquisition described in the Offering Memorandum), shall be calculated giving pro forma effect to Pro Forma Cost Savings;
(ii) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded in accordance with clause (i) above;
(iii) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded in accordance with clause (i) above, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the referent Person or any of its Restricted Subsidiaries following the Calculation Date;
(iv) Consolidated Cash Flow shall be calculated giving pro forma effect to the creation, designation or redesignation of Restricted and Unrestricted Subsidiaries, as if such creation, designation or redesignation occurred on the first day of the four-quarter reference period; and
(v) if any Indebtedness being incurred bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in excess of 12 months).
Foreign Restricted Subsidiary means any Restricted Subsidiary of the Company that is not a Domestic Subsidiary.
GAAP means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, in each case, which are in effect on the date of this Indenture.
Global Note Legend means the legend set forth in Section 2.06(g)(ii), which is required to be placed on all Global Notes issued under this Indenture.
Global Notes means the global Notes in the form of Exhibit A hereto issued in accordance with Article 2 hereof.
Guarantee means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements), of all or any part of any Indebtedness.
Hedging Obligations means, with respect to any Person, the obligations of such Person under
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(i) interest rate or currency swap agreements, interest rate cap agreements and interest rate collar agreements,
(ii) other agreements or arrangements designed for the purpose of fixing, hedging or swapping interest rate risk or currency exchange rate risk, and
(iii) commodities purchase and sale agreements and other similar agreements designed for the purpose of fixing, hedging or swapping the price risk related to raw materials or other commodities (including fuel) used by the Company and its Restricted Subsidiaries in the ordinary course of business.
Holder means a Person in whose name a Note is registered.
IAI Global Note means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold to Institutional Accredited Investors, if any, to the extent required by the Applicable Procedures.
Indebtedness means, with respect to any Person, any indebtedness of such Person, whether or not contingent, in respect of:
(i) borrowed money, or
(ii) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or related reimbursement agreements), or
(iii) bankers acceptances, or
(iv) representing Capital Lease Obligations, or
(v) the balance deferred and unpaid of the purchase price of any property except any such balance that constitutes an accrued expense or trade payable, or
(vi) representing the net amount owing under any Hedging Obligations relating to interest rate risk,
if and to the extent any of the foregoing (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of such Person prepared in accordance with GAAP, as well as all Indebtedness of others secured by a Lien on any asset of such Person (whether or not such Indebtedness is assumed by such Person) and, to the extent not otherwise included, the Guarantee by such Person of any Indebtedness of any other Person.
Indenture means this instrument, as originally executed or as it may from time to time be supplemented or amended in accordance with Article 9 hereof.
Indirect Participant means a Person who holds a beneficial interest in a Global Note through a Participant.
Initial Notes means $175,000,000 in aggregate principal amount of Notes issued under this Indenture on the date hereof.
Initial Public Offerings means the issuance and sale of common equity securities of the Company, or any direct or indirect parent of the Company (but only if the proceeds thereof are contributed to the common equity capital of the Company), pursuant to a firm commitment underwritten public offering pursuant to an effective registration statement under the Securities Act.
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Institutional Accredited Investor means an institution that is an accredited investor as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
Interest Payment Dates shall have the meaning set forth in paragraph 1 of each Note.
Investments means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the forms of direct or indirect loans (including Guarantees of Indebtedness or other Obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP; provided that an acquisition of Equity Interests or other securities by the Company or any of its Restricted Subsidiaries for consideration consisting solely of Equity Interests (other than Disqualified Stock) of the Company shall not be deemed to be an Investment. If the Company or any Restricted Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to the sale or disposition, such Person is no longer a Restricted Subsidiary of the Company, the Company shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of the Restricted Subsidiary not sold or disposed of in an amount determined as provided in the final paragraph of Section 4.10.
Issue Date means December 22, 2003.
Lease Deficiency Claim means all obligations and claims arising under the Bareboat Charter Agreement dated as of October 9, 1998 (as amended, restated, supplemented or otherwise modified, the Charter Agreement) by and between GLDD and Banc of America Leasing & Capital, LLC and the other documents executed in connection therewith (the Transaction Documents ) which remain outstanding after giving effect to (i) the termination of Great Lakes Dredge & Dock Companys obligation to pay basic hire for the dredge which is chartered under the Charter Agreement (the Dredge ), (ii) the sale of the Dredge at public or private sale and (iii) the application of the proceeds from such sale to the payment of any outstanding obligations under the Charter Agreement and other Transaction Documents pursuant to the terms thereof.
Legal Holiday means a Saturday, a Sunday or a day on which banking institutions in the city of New York, the city of Chicago, the city in which the Corporate Trust Office of the Trustee is located or any other place of payment on the Notes are authorized by law, regulation or executive order to remain closed.
Letter of Transmittal means the letter of transmittal, or its electronic equivalent in accordance with the Applicable Procedures, to be prepared by the Company and sent to all Holders of the Initial Notes or any Additional Notes for use by such Holders in connection with an Exchange Offer.
Lien means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, any lease in the nature of a conditional sale or title retention agreement, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
Liquidated Damages has the meaning set forth in a Registration Rights Agreement relating to amounts to be paid in the event the Company fails to satisfy certain conditions set forth therein. For all purposes of this Indenture, the term interest shall include Liquidated Damages, if any, with respect to the Notes.
Madison Dearborn Partners means Madison Dearborn Partners, LLC.
Management Investor means those executive officers of the Company or its Subsidiaries acquiring Equity Interests in any direct or indirect parent company of the Company in connection with the Transactions.
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Material Subsidiary means any Domestic Subsidiary that at any time has Total Assets of $500,000 or more.
Merger Agreement means the Amended and Restated Agreement and Plan of Merger among GLDD Acquisitions Corp., GLDD Merger Sub, Inc., Great Lakes Dredge & Dock Corporation and Vectura Holding Company LLC, dated as of December 22, 2003, in connection with the sale of all of the outstanding common stock of Great Lakes Dredge & Dock Corporation to GLDD Acquisitions Corp. and the merger of GLDD Merger Sub, Inc. with and into Great Lakes Dredge & Dock Corporation.
Moodys means Moodys Investors Service, Inc. or any successor to the rating agency business of Moodys Investors Service, Inc.
Net Income means, with respect to any Person for any period, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of dividends on preferred interests, excluding, however,
(a) any gain or loss, together with any related provision for taxes on the gain or loss, realized in connection with (1) any Asset Sale (including, without limitation, dispositions pursuant to sale and leaseback transactions) (without giving effect to the $2.0 million threshold provided for in the definition thereof) or (2) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries and
(b) any extraordinary or nonrecurring gain or loss, together with any related provision for taxes on the extraordinary or nonrecurring gain or loss.
Net Proceeds means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale (including Designated Noncash Consideration)), net of
(i) the direct costs relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees, and sales commissions) and any related relocation expenses,
(ii) any taxes paid or payable as a result of the Asset Sale (after taking into account any available tax credits or deductions, any tax sharing arrangements),
(iii) any reserve for adjustment in respect of the sale price of the asset or assets established in accordance with GAAP,
(iv) payments made to repay Indebtedness or any other obligation outstanding at the time of such Asset Sale that either (A) is secured by a Lien on the property or assets sold or (B) is required to be paid as a result of such sale,
(v) all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures as a result of such Asset Sale, and
(vi) appropriate amounts to be provided by the Company or any Restricted Subsidiary as a reserve against any liabilities associated with such Asset Sale, including, without limitation, pension and other post-employment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale, all as determined in conformity with GAAP.
New Credit Facility means that Credit Agreement, dated as of the date of this Indenture, by and among the Company, Lehman Brothers Inc. and Credit Suisse First Boston, acting through its Cayman Islands Branch, as joint advisors, joint lead arrangers and joint book runners, Bank of America, N.A., as administrative agent, and the other lenders that are party to the Credit Agreement, initially providing for up to $60.0 million of
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revolving credit borrowings or letters of credit and $60.3 million of term borrowings, including any related notes, Guarantees, collateral documents, instruments and agreements executed in connection therewith, and in each case as increased as permitted by the terms of this Indenture, and amended, modified, renewed, restated, refunded, replaced or refinanced from time to time, including any agreement extending the maturity of, refinancing, replacing or otherwise restructuring (including adding Subsidiaries of the Company as additional borrowers or guarantors thereunder) all or any portion of the Indebtedness under such agreement or any successor or replacement agreement and whether by the same or any other agent, lender or group of lenders or through the issuance of debt securities.
Non-Recourse Debt means Indebtedness
(i) as to which neither the Company nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable (as a guarantor or otherwise), or (c) constitutes the lender; and
(ii) no default with respect to which (including any rights that any holders may have to take enforcement action against an Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness (other than the Notes) of the Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause its payment to be accelerated or payable prior to its Stated Maturity; and
(iii) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any of its Restricted Subsidiaries.
Obligations means any principal, interest, penalties, fees, indemnifications, costs, expenses, reimbursement obligations, damages and other liabilities and obligations which may arise under or in connection with the New Credit Facility or the bonding agreement or under or in connection with the documentation governing any Indebtedness, and in all cases whether direct or indirect, absolute or contingent, now outstanding or hereafter created, assumed or incurred and including, without limitation, interest accruing subsequent to the filing of a petition in bankruptcy or the commencement of any insolvency, reorganization or similar proceedings at the rate provided in the relevant document, whether or not an allowed claim, and any obligation to redeem or defease any of the foregoing.
Offering Memorandum means the offering memorandum, dated December 12, 2003, relating to the Initial Notes.
Officer means the Chief Executive Officer, the President, the Chief Financial Officer, the Secretary, any Executive Vice President or any Senior Vice President of the Company.
Officers Certificate means a certificate, in form and substance reasonably satisfactory to the Trustee, signed by two Officers of the Company, at least one of whom shall be the principal executive officer or principal financial officer of the Company, and delivered to the Trustee.
Opinion of Counsel means a written opinion from legal counsel and which meets the requirements of Section 13.05 hereof. The counsel may be an employee of or counsel to the Company.
Participant means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively, and, with respect to DTC, shall include Euroclear and Clearstream.
Permitted Bonding Obligations means (i) obligations incurred by the Company or any of its Subsidiaries (including Guarantees) with respect to letters of credit, bankers acceptances, bid, payment, performance, surety, appeal or similar bonds and completion guarantees in the ordinary course of business and (ii) obligations incurred by the Company or any of its Subsidiaries (including Guarantees) under the Bonding Agreement.
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Permitted Business means any of the businesses engaged in by Great Lakes Dredge & Dock Corporation and its Restricted Subsidiaries on the date of this Indenture and any other reasonably related, complementary or ancillary business or other business that is a reasonable extension or expansion of such businesses.
Permitted Investments means
(a) any Investment in the Company or in a Restricted Subsidiary of the Company;
(b) any Investment in Cash Equivalents;
(c) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment (i) such Person becomes a Restricted Subsidiary of the Company or (ii) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary of the Company;
(d) any Investment made as a result of the receipt of assets not constituting Cash Equivalents from an Asset Sale that was made pursuant to and in compliance with Section 4.12;
(e) any acquisition of assets solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company;
(f) other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (f) that are at the time outstanding, not to exceed $20.0 million, provided , however , that if an Investment pursuant to this clause (f) is made in any Person that is not a Restricted Subsidiary of the Company at the date of the making of the Investment and such person becomes a Restricted Subsidiary after such date, such Investment shall thereafter be deemed to have been made pursuant to clause (a) above, and shall cease to have been made pursuant to this clause (f);
(g) Investments received in settlement, compromise or resolution of: (a) obligations of trade creditors, suppliers or customers that were incurred in the ordinary course of business of the Company or any of its Subsidiaries including pursuant to a plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditors, suppliers or customers or (b) litigation, arbitration or other disputes with Persons;
(h) Investments existing on the date of this Indenture;
(i) loans and advances to officers, directors, members and employees for business-related travel expenses, moving expenses and other similar expenses, in each case, incurred in the ordinary course of business not to exceed $2.0 million in the aggregate at any time;
(j) any Hedging Obligation;
(k) Investments consisting of intercompany loans from the Company and its Restricted Subsidiaries to Restricted Subsidiaries, including Restricted Subsidiaries that are not Subsidiary Guarantors;
(1) Investments in joint ventures formed in the ordinary course of business for the purpose of bidding and completing specific projects within a Permitted Business in an aggregate amount at any one time outstanding not to exceed $7.5 million;
(m) Guarantees otherwise permitted by the terms of this Indenture; and
(n) Investments resulting from the acquisition of a Person that at the time of such acquisition held instruments constituting Investments that were not acquired in contemplation of the acquisition of such Person.
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Permitted Junior Securities means Equity Interests in the Company or debt securities that are subordinated to all Senior Debt (and any debt securities issued in exchange for Senior Debt) to substantially the same extent as, or to a greater extent than, the Notes are subordinated to Senior Debt pursuant to this Indenture; provided that no such Equity Interests or debt securities may be issued if the rights of the holders of the Senior Debt are impaired by the issuance in connection with a reorganization, including, without limitation, by reason of such rights being impaired within the meaning of Section 1124 of Title 11 of the United States Code.
Permitted Liens means
(i) Liens on assets of the Company and any Restricted Subsidiary securing Senior Debt provided , in each case, that such Indebtedness was permitted by the terms of this Indenture to be incurred;
(ii) Liens in favor of the Company or a Restricted Subsidiary;
(iii) Liens on property or assets of, or any equity interest in or secured debt of, a Person existing at the time that Person is merged with or into or consolidated with the Company or any Restricted Subsidiary of the Company; provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with the Company;
(iv) Liens on property (including Capital Stock) existing at the time the property was acquired by the Company or any Restricted Subsidiary of the Company, provided that such Liens were in existence prior to the contemplation of the acquisition of property;
(v) Liens to secure the performance of statutory obligations, surety or appeal bonds, bid bonds, payment bonds, performance and lien bonds or other obligations of a like nature incurred in the ordinary course of business;
(vi) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by clause (iv) or (viii) of the second paragraph of Section 4.09 covering, in the case of such clause (iv), only the assets (including any insurance, leases and charters relating to such assets, and any proceeds thereof) acquired, constructed, repaired or improved with such Indebtedness;
(vii) Liens existing on the date of this Indenture and any renewals or extensions thereof on terms no more restrictive and secured by the same collateral as existing on the date of this Indenture;
(viii) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded, provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor;
(ix) Liens on assets of Unrestricted Subsidiaries that secure Non-Recourse Debt of Unrestricted Subsidiaries;
(x) Liens incurred in the ordinary course of business of the Company or any Restricted Subsidiary of the Company with respect to obligations that do not exceed $7.5 million at any one time outstanding and that (a) are not incurred in connection with the borrowing of money or the obtaining of advances or credit (other than trade credit in the ordinary course of business) and (b) do not in the aggregate materially detract from the value of the property or materially impair the use of the property in the operation of business by the Company or the Restricted Subsidiary;
(xi) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens (including maritime Liens) imposed by law incurred in the ordinary course of business;
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(xii) Liens incurred or deposits made in the ordinary course of business in connection with workers compensation, unemployment insurance and other types of social security or similar obligations, or to secure the performance of tenders, statutory or regulatory obligations, surety and appeal bonds, bids, leases, government contracts, payment and performance and return-of-money bonds, bankers acceptances, and other similar obligations (exclusive of obligations for the payment of borrowed money);
(xiii) judgment or attachment Liens not giving rise to an Event of Default;
(xiv) easements, rights-of-way, municipal and zoning restrictions and other similar charges, title defects, encumbrances or irregularities in respect of real property not interfering in any material respect with the ordinary course of the business of the Company or any of its Restricted Subsidiaries;
(xv) any interest or title of a lessor under any lease, whether or not characterized as capital or operating; provided that such Liens do not extend to any property or assets which are not leased property subject to such lease;
(xvi) Liens securing Hedging Obligations;
(xvii) Liens securing reimbursement obligations with respect to letters of credit and products and proceeds thereof;
(xviii) Liens securing Permitted Refinancing Indebtedness which is incurred to refinance any Indebtedness which has been secured by a Lien permitted under this Indenture and which has been incurred in accordance with the provisions of this Indenture;
(xix) Liens in favor of the Company or any of its Restricted Subsidiaries securing Indebtedness of any Restricted Subsidiary that is not a Subsidiary Guarantor;
(xx) Liens with respect to current wages of the master and crew and for wages of a stevedore when employed directly by the Company or any Subsidiary of the Company, or by the charterer, operator, master or agent of any of the vessels owned or operated by the Company or any Subsidiary of the Company; and
(xxi) Liens for salvage (including contract salvage); and
(xxii) Liens to secure Indebtedness of any Foreign Restricted Subsidiary permitted to be incurred under Section 4.09 covering only the assets of such Foreign Restricted Subsidiary.
Permitted Refinancing Indebtedness means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in exchange for, or to extend, refinance, renew, replace, defease or refund, other Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany Indebtedness); provided that:
(i) the principal amount (or accreted value, if applicable) of the Permitted Refinancing Indebtedness does not exceed the principal amount of (or accreted value, if applicable), plus accrued interest on, the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded (plus the amount of reasonable expenses, premiums, penalties, fees and interest incurred in connection therewith);
(ii) if the final maturity date of the Indebtedness being refinanced is earlier than the final maturity of the Notes, the Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded or (b) if the final maturity of the Indebtedness being refinanced is later than the final maturity of the Notes, the Permitted Refinancing Indebtedness has a final maturity at least 91 days later than the Notes;
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(iii) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes, the Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the Notes on terms at least as favorable to the Holders of Notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; and
(iv) such Indebtedness is incurred either (a) by the Company or any Subsidiary Guarantor or (b) by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded.
Permitted Tax Distributions means the payment of any distributions to permit direct or indirect Beneficial Owners of shares of Capital Stock of the Company to pay federal, state or local income tax liabilities arising from income to the Company and attributable to them solely as a result of the Company and any intermediate entity through which the holder owns such shares being a limited liability company, partnership or similar entity for federal income tax purposes.
Person means any individual, corporation, company (including any limited liability company), association, partnership, joint venture, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.
Predecessor Note of any particular Note means every previous Note evidencing all or a portion of the same Indebtedness as that evidenced by such particular Note; and any Note authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same Indebtedness as the lost, destroyed or stolen Note.
Principals means (i) Madison Dearborn Partners, (ii) the Management Investors and (iii) any Related Party of a Person referred to in clauses (i) and (ii).
Private Placement Legend means the legend set forth in Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture except as otherwise permitted by the provisions of this Indenture.
Pro Forma Cost Savings means, with respect to any period, the reduction in costs that were (i) directly attributable to an asset acquisition and calculated on a basis that is consistent with Regulation S-X under the Securities Act in effect and as applied as of the date of this Indenture, or (ii) were actually implemented by the business that was the subject of any such asset acquisition within six months of the date of the asset acquisition and that are supportable and quantifiable by the underlying accounting records of such business, in each case as if such reductions in cost had been effected as of the beginning of the applicable period and, in the case of each of (i) and (ii), are described, as provided below, in an Officers Certificate, as if all such reductions in costs had been effected as of the beginning of such period. Pro Forma Cost Savings described above shall be accompanied by a certificate delivered to the Trustee from the Companys chief financial officer that outlines the specific actions taken or to be taken and the net cost savings achieved or to be achieved from each such action.
QIB means a qualified institutional buyer as defined in Rule 144A.
Qualified Proceeds means any of the following or any combination of the following: (i) cash, (ii) Cash Equivalents, (iii) assets that are used or useful in a Permitted Business and (iv) the Capital Stock of any Person engaged in a Permitted Business if, in connection with the receipt by the Company or any Restricted Subsidiary of the Company of such Capital Stock, (a) such Person becomes a Restricted Subsidiary of the Company or any Restricted Subsidiary of the Company or (b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or any Restricted Subsidiary of the Company.
Registration Rights Agreement means the Registration Rights Agreement dated as of the Issue Date, among the Company, the Guarantors from time to time party thereto and the initial purchasers named therein, as such agreement may be amended, modified or supplemented from time to time and, with respect to any
17
Additional Notes, one or more registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the Company to the purchasers of Additional Notes to register such Additional Notes, or exchange such Additional Notes for registered Notes, under the Securities Act.
Regular Record Date for the interest payable on any Interest Payment Date means the applicable date specified as a Record Date on the face of the Note.
Regulation S means Regulation S promulgated under the Securities Act.
Regulation S Global Note means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal amount of the Notes sold for initial resale in reliance on Rule 903 of Regulation S.
Related Party means
(a) with respect to Madison Dearborn Partners
(i) any investment fund controlled by or under common control with, Madison Dearborn Partners, and any officer, director or employee of Madison Dearborn Partners or any entity controlled by, or under common control with, Madison Dearborn Partners,
(ii) any spouse or lineal descendant (including by adoption and stepchildren) of the officers, directors and employees referred to in clause (a)(i) above,
(iii) any trust, corporation, partnership or other entity, of which 80% in interest is held by beneficiaries, stockholders, partners or owners who are one or more of the Persons described in clause (a)(i) or (ii) above; and
(b) with respect to any officer or employee of the Company or a Subsidiary of the Company (i) any spouse or lineal descendant (including by adoption and stepchildren) of the officer or employee and (ii) any trust, corporation, partnership or other entity, of which 80% in interest is held by beneficiaries, stockholders, partners or owners who are the officer or employee of any of the persons described in clause (b)(i) above or any combination of these identified relationships.
Representative means the trustee, agent or representative expressly authorized to act in such capacity, if any, for an issue of Senior Debt.
Responsible Officer , when used with respect to the Trustee, means any officer within the Corporate Trust Department of the Trustee (or any successor group of the Trustee) with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject.
Restricted Definitive Note means one or more Definitive Notes bearing the Private Placement Legend.
Restricted Global Notes means 144A Global Notes, IAI Global Notes and Regulation S Global Notes.
Restricted Investment means an Investment other than a Permitted Investment.
Restricted Subsidiary of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.
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Rule 144 means Rule 144 promulgated under the Securities Act.
Rule 144A means Rule 144A promulgated under the Securities Act.
Rule 903 means Rule 903 promulgated under the Securities Act.
Rule 904 means Rule 904 promulgated under the Securities Act.
S&P means Standard & Poors Ratings Group, a division of McGraw Hill, Inc., or any successor to the rating agency business thereof.
Securities Act means the Securities Act of 1933, as amended.
Senior Debt means
(i) all Obligations of the Company or a Restricted Subsidiary outstanding under the New Credit Facility, including any Guarantee and all related Hedging Obligations and all accrued interest and fees following the commencement of a proceeding under bankruptcy law, whether or not considered an allowed claim in such proceeding,
(ii) all Permitted Bonding Obligations from time to time outstanding,
(iii) any other Indebtedness of the Company or a Restricted Subsidiary permitted to be incurred under the terms of this Indenture, unless the instrument under which such Indebtedness is incurred expressly provides that it is on a parity with or subordinated in right of payment to the Notes,
(iv) all Obligations with respect to the foregoing; and
(v) the Lease Deficiency Claim.
Notwithstanding anything to the contrary in the foregoing, Senior Debt will not include:
(I) any liability for federal, state, local or other taxes owed or owing,
(II) any Indebtedness of the Company or any Restricted Subsidiary to any Subsidiary of the Company,
(III) any trade payables,
(IV) any Indebtedness which is expressly contractually subordinated to any other Indebtedness of the Company or any of its Subsidiary Guarantors, or
(V) any Indebtedness (other than pursuant to clause (i) above) that is incurred in violation of this Indenture.
Shelf Registration Statement means the registration statement relating to the registration of the Notes under Rule 415 of the Securities Act, as may be set forth in a Registration Rights Agreement.
Significant Subsidiary means any Subsidiary that would be a significant subsidiary as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Act, as that Regulation is in effect on the date hereof.
Stated Maturity means, with respect to any installment of interest or principal (including any sinking fund payment) on any series of Indebtedness, the date on which payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any
19
contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for their payment.
Subsidiary means, with respect to any Person, (i) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof) and (ii) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or of one or more Subsidiaries of such Person (or any combination thereof).
Subsidiary Guarantee means the Guarantee of the Notes by each of the Subsidiary Guarantors pursuant to Article 10 and in the form of the Guarantee attached as Exhibit E and any additional Guarantee of the Notes to be executed by any Subsidiary of the Company pursuant to Section 4.19.
Subsidiary Guarantors means each of (i) the wholly owned Domestic Restricted Subsidiaries of the Company on the date of this Indenture and (ii) any other subsidiary that executes a Subsidiary Guarantee in accordance with the provisions of this Indenture, and their respective successors and assigns.
TIA means the Trust Indenture Act of 1939, as amended, and the rules and regulations thereunder.
Total Assets means, with respect to any Person, the aggregate of all assets of such Person and its Subsidiaries as would be shown on the most recently prepared consolidated balance sheet of such Person in accordance with GAAP.
Total Tangible Assets means, with respect to any Person, the aggregate of all assets of such Person and its Subsidiaries as would be shown on the consolidated balance sheet of such Person in accordance with GAAP, less goodwill and intangibles.
Transactions means the transactions contemplated by the Merger Agreement and the related financing transactions, including those under the New Credit Facility and this Indenture, in each case as in effect on the date of this Indenture.
Trustee means the Person named as the Trustee in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter Trustee shall mean such successor Trustee.
Unrestricted Definitive Notes means one or more Definitive Notes that do not and are not required to bear the Private Placement Legend.
Unrestricted Global Notes means one or more Global Notes that do not and are not required to bear the Private Placement Legend and are deposited with and registered in the name of the Depositary or its nominee.
Unrestricted Subsidiary means (i) any Subsidiary of the Company or any successor to any of them) that is designated by the Board of Directors of the Company as an Unrestricted Subsidiary pursuant to a Board Resolution, but only to the extent that such Subsidiary:
(a) has no Indebtedness other than Non-Recourse Debt;
(b) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company;
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(c) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (x) to subscribe for additional Equity Interests or (y) to maintain or preserve such Persons financial condition or to cause such Person to achieve any specified levels of operating results;
(d) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its Restricted Subsidiaries; and
(e) has at least one director on its Board of Directors that is not a director or executive officer of the Company or any of its Restricted Subsidiaries and has at least one executive officer that is not a director or executive officer of the Company or any of its Restricted Subsidiaries.
U.S. Government Securities means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) for the payment of which the full faith and credit of the United States of America is pledged and which are not callable or redeemable at the issuers option.
Voting Stock of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
Weighted Average Life to Maturity means, when applied to any Indebtedness at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (ii) the then outstanding principal amount of such Indebtedness.
Wholly Owned Restricted Subsidiary of any Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person and one or more Wholly Owned Restricted Subsidiaries of such Person.
SECTION 1.02. OTHER DEFINITIONS .
Term |
|
Defined in
|
|
Acceleration Notice |
|
6.02 |
|
Affiliate Transaction |
|
4.14 |
|
Asset Sale Offer |
|
4.12 |
|
Authentication Order |
|
2.02 |
|
Benefited Party |
|
10.01 |
|
Change of Control Offer |
|
4.18 |
|
Change of Control Payment |
|
4.18 |
|
Covenant Defeasance |
|
8.03 |
|
DTC |
|
2.03 |
|
Excess Proceeds |
|
4.12 |
|
Event of Default |
|
6.01 |
|
Legal Defeasance |
|
8.02 |
|
losses |
|
7.07 |
|
Offer Amount |
|
3.09 |
|
Offer Period |
|
3.09 |
|
Offer to Purchase |
|
3.09 |
|
Paying Agent |
|
2.03 |
|
Payment Blockage Notice |
|
12.03 |
|
Payment Blockage Period |
|
12.03 |
|
pay the Notes |
|
12.03 |
|
Purchase Date |
|
3.09 |
|
Registrar |
|
2.03 |
|
Security Register |
|
2.03 |
|
Tax Payments |
|
4.10 |
|
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SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT .
(a) Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture.
(b) The following TIA terms used in this Indenture have the following meanings:
indenture securities means the Notes and the Subsidiary Guarantees;
indenture security holder means a Holder;
indenture to be qualified means this Indenture;
indenture trustee or institutional trustee means the Trustee; and
obligor on the Notes means the Company and any successor obligor upon the Notes.
(c) All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule under the TIA and not otherwise defined herein have the meanings so assigned to them either in the TIA, by another statute or Commission rule, as applicable.
SECTION 1.04. RULES OF CONSTRUCTION .
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined herein has the meaning assigned to it in accordance with GAAP;
(iii) or is not exclusive;
(iv) words in the singular include the plural, and in the plural include the singular;
(v) all references in this instrument to Articles, Sections and other subdivisions are to the designated Articles, Sections and subdivisions of this instrument as originally executed;
(vi) the words herein, hereof and hereunder and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.
(vii) including means including without limitation;
(viii) provisions apply to successive events and transactions; and
(ix) references to sections of or rules under the Securities Act, the Exchange Act or the TIA shall be deemed to include substitute, replacement or successor sections or rules adopted by the Commission from time to time thereunder.
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THE NOTES
SECTION 2.01. FORM AND DATING .
(a) General . The Notes and the Trustees certificate of authentication shall be substantially in the form included in Exhibit A hereto, which is hereby incorporated in and expressly made part of this Indenture. The Notes may have notations, legends or endorsements required by law, exchange rule or usage in addition to those set forth on Exhibit A. Each Note shall be dated the date of its authentication. The Notes shall be in denominations of $1,000 and integral multiples thereof. The terms and provisions contained in the Notes shall constitute a part of this Indenture and the Company, the Subsidiary Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. To the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling.
(b) Form of Notes . Notes shall be issued initially in global form and shall be substantially in the form of Exhibit A attached hereto (including the Global Note Legend thereon and the Schedule of Exchanges of Interests in the Global Note attached thereto). Notes issued in definitive form shall be substantially in the form of Exhibit A attached hereto (but without the Global Note Legend thereon and without the Schedule of Exchanges of Interests in the Global Note attached thereto). Each Global Note shall represent such aggregate principal amount of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions and transfers of interests therein. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof.
(c) Book-Entry Provisions . This Section 2.01(c) shall apply only to Global Notes deposited with the Trustee, as custodian for the Depositary. Participants and Indirect Participants shall have no rights under this Indenture or any Global Note with respect to any Global Note held on their behalf by the Depositary or by the Trustee as custodian for the Depositary, and the Depositary shall be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Participants or Indirect Participants, the Applicable Procedures or the operation of customary practices of the Depositary governing the exercise of the rights of a holder of a beneficial interest in any Global Note.
(d) Euroclear and Clearstream Procedures Applicable . The provisions of the Operating Procedures of the Euroclear System and Terms and Conditions Governing Use of Euroclear of Euroclear and the General Terms and Conditions of Clearstream and Customer Handbook of Clearstream shall be applicable to transfers of beneficial interests in Global Notes that are held by Participants through Euroclear or Clearstream.
(e) Certificated Securities.
(i) The Company shall issue Definitive Notes to all owners of beneficial interests in Global Notes if: (1) at any time the Depositary notifies the Company that it is unwilling or unable to continue to act as Depositary for the Global Notes or if at any time the Depositary shall no longer be eligible to act as such because it ceases to be a clearing agency registered under the Exchange Act, and, in either case, the Company shall not have appointed a successor Depositary within 120 days after the Company receives such notice or becomes aware of such ineligibility or (2) the Company, at its option, determines that the Global Notes shall be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee. Upon the occurrence of any of the events set forth in clauses (1) or (2) above, the Company shall execute, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee
23
shall authenticate and deliver, Definitive Notes, in authorized denominations, in an aggregate principal amount equal to the principal amount of the Global Notes in exchange for such Global Notes. Upon the exchange of a Global Note for Definitive Notes, such Global Note shall be cancelled by the Trustee or an agent of the Company or the Trustee.
(ii) The Company shall issue Definitive Notes to a Holder of, or an owner of a beneficial interest in, a Global Note in exchange for such Global Note or beneficial interest, as the case may be, upon written request from a Holder of, or an owner of a beneficial interest in, a Global Note if a Default or Event of Default shall have occurred and be continuing. Upon the occurrence of the foregoing, the Company shall execute, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver, Definitive Notes, in authorized denominations, in an aggregate principal amount equal to the principal amount of the Global Note owned by such Holder or such owner of a beneficial interest. Upon the exchange of all or a portion of a Global Note for Definitive Notes, such Global Note shall be cancelled or correspondingly reduced by the Trustee or an agent of the Company or the Trustee. In the event that the Definitive Notes are not issued to an owner of a beneficial interest in a Global Note promptly after the Company has received a request from such owner, the Company expressly acknowledges, with respect to the right of any Holder to pursue a remedy pursuant to this Indenture, the right of any such owner to pursue such remedy with respect to the portion of the Global Note that represents such owners beneficial interest as if such Definitive Notes had been issued.
(iii) Definitive Notes issued in exchange for a Global Note pursuant to this Section 2.01 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its Participants or its Applicable Procedures, shall instruct the Trustee or an agent of the Company or the Trustee in writing. The Trustee or such agent shall deliver such Definitive Notes to or as directed by the Persons in whose names such Definitive Notes are so registered or to the Depositary.
SECTION 2.02. EXECUTION AND AUTHENTICATION .
(a) One Officer shall execute the Notes on behalf of the Company by manual or facsimile signature.
(b) If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated by the Trustee, the Note shall nevertheless be valid.
(c) A Note shall not be valid until authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
(d) The Trustee shall, upon a written order of the Company signed by an Officer (an Authentication Order ), authenticate Notes for issuance.
(e) The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. Unless otherwise provided in such appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent shall have the same rights as the Trustee to deal with Holders, the Company or an Affiliate of the Company.
SECTION 2.03. REGISTRAR AND PAYING AGENT .
(a) The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange ( Registrar ) and an office or agency where Notes may be presented for payment ( Paying Agent ). The Registrar shall keep a register (the Security Register ) of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term Registrar includes any co-registrar and the term Paying Agent includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Company
24
fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar.
(b) The Company initially appoints The Depository Trust Company ( DTC ) to act as Depositary with respect to the Global Notes.
(c) The Company initially appoints the Trustee to act as Registrar and Paying Agent and to act as Custodian with respect to the Global Notes, and the Trustee hereby agrees so to initially act.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST .
The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium, if any, or interest on the Notes, and shall notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all funds held by it relating to the Notes to the Trustee. The Company at any time may require a Paying Agent to pay all funds held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for such funds. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all funds held by it as Paying Agent. Upon any Event of Default under Sections 6.01(vii) and (viii) hereof relating to the Company, the Trustee shall serve as Paying Agent for the Notes.
SECTION 2.05. HOLDER LISTS .
The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders and shall otherwise comply with TIA §312(a). If the Trustee is not the Registrar, the Company shall furnish or cause to be furnished to the Trustee at least seven Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date or such shorter time as the Trustee may allow, as the Trustee may reasonably require of the names and addresses of the Holders and the Company shall otherwise comply with TIA §312(a).
SECTION 2.06. TRANSFER AND EXCHANGE .
(a) Transfer and Exchange of Global Notes . A Global Note may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. Upon the occurrence of any of the events set forth in Section 2.01(e) above, Definitive Notes shall be issued in denominations of $1,000 or integral multiples thereof and in such names as the Depositary shall instruct the Trustee in writing. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Except as provided above, every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Note other than as provided in this Section 2.06(a), and beneficial interests in a Global Note may not be transferred and exchanged other than as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes . The transfer and exchange of beneficial interests in the Global Notes shall be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in Global Notes also shall require compliance with either clause (i) or (ii) below, as applicable, as well as one or more of the other following clauses, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note . Beneficial interests in any Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer restrictions set forth in the
25
Private Placement Legend and any Applicable Procedures; provided , however , that prior to the expiration of the Distribution Compliance Period, transfers of beneficial interests in the Regulation S Global Note may not be made to or for the account or benefit of a U.S. Person (as defined in Rule 902(k) of Regulation S) (other than a distributor (as defined in Rule 902(d) of the Regulation S)). Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. Except as may be required by any Applicable Procedures, no written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes . In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.06(b)(i) above, the transferor of such beneficial interest must deliver to the Registrar either (A)(1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B)(1) if permitted under Section 2.06(a), a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the transfer or exchange referred to in (B)(1) above. Upon consummation of an Exchange Offer by the Company in accordance with Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall be deemed to have been satisfied upon receipt by the Registrar of the instructions contained in the Letter of Transmittal delivered by the Holder of such beneficial interests in the Restricted Global Notes. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests in a Restricted Global Note to Another Restricted Global Note . A holder of a beneficial interest in a Restricted Global Note may transfer such beneficial interest to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of Section 2.06(b)(ii) above and the Registrar receives the following:
(A) if the transferee will take delivery in the form of a beneficial interest in the 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof or, if permitted by the Applicable Procedures, item (3) thereof;
(B) if the transferee will take delivery in the form of a beneficial interest in the Regulation S Temporary Global Note or the Regulation S Permanent Global Note, as the case may be, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and
(C) if the transferee is required by the Applicable Procedures to take delivery in the form of a beneficial interest in the IAI Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications and certificates and Opinion of Counsel required by item (3) thereof, if applicable.
(iv) Transfer or Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note . A holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for a beneficial interest in an
26
Unrestricted Global Note or may transfer such beneficial interest to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if the exchange or transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with a Registration Rights Agreement and the holder of the beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications required in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;
(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;
(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer complies with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to clause (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to clause (B) or (D) above.
(v) Transfer or Exchange of Beneficial Interests in an Unrestricted Global Note for Beneficial Interests in a Restricted Global Note Prohibited . Beneficial interests in an Unrestricted Global Note may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Note.
(c) Transfer and Exchange of Beneficial Interests in Global Notes for Definitive Notes .
(i) Transfer or Exchange of Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes . Subject to Section 2.06(a) hereof, if any holder of a beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Note, then, upon receipt by the Registrar of the following documentation:
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(A) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a Non-U.S. Person in an offshore transaction (as defined in Section 902(k) of Regulation S) in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in clauses (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, if applicable; or
(F) if such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof,
the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h) hereof, the aggregate principal amount of the applicable Restricted Global Note, and the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver a Restricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in the instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder. Any Restricted Definitive Note issued in exchange for beneficial interests in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions. The Trustee shall deliver such Restricted Definitive Notes to the Persons in whose names such Notes are so registered. Any Restricted Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.
(ii) Transfer or Exchange of Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes . Subject to Section 2.06(a) hereof, a holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made
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through the Applicable Procedures) as may be required by such Registration Rights Agreement;
(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;
(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer complies with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
Upon satisfaction of any of the conditions of any of the clauses of this Section 2.06(c)(ii), the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder, and the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h), the aggregate principal amount of the applicable Restricted Global Note.
(iii) Transfer or Exchange of Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes . Subject to Section 2.06(a) hereof, if any holder of a beneficial interest in an Unrestricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note, then, upon satisfaction of the applicable conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h) hereof, the aggregate principal amount of the applicable Unrestricted Global Note, and the Company shall execute, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder. Any Unrestricted Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions. The Trustee shall deliver such Unrestricted Definitive Notes to the Persons in whose names such Notes are so registered. Any Unrestricted Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests in the Global Notes .
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(i) Transfer or Exchange of Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes . If any holder of a Restricted Definitive Note proposes to exchange such Restricted Definitive Note for a beneficial interest in a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation:
(A) if the holder of such Restricted Definitive Note proposes to exchange such Restricted Definitive Note for a beneficial interest in a Restricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred to a non-U.S. Person in an offshore transaction (as defined in Rule 902(k) of Regulation S) in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in clauses (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, if applicable; or
(F) if such Restricted Definitive Note is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof, the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, a 144A Global Note, in the case of clause (C) above, a Regulation S Global Note, and in all other cases, a IAI Global Note.
(ii) Transfer or Exchange of Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes . A holder of a Restricted Definitive Note may exchange such Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;
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(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;
(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such Restricted Definitive Note proposes to exchange such Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(c) thereof; or
(2) if the holder of such Restricted Definitive Note proposes to transfer such Restricted Definitive Note to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses in this Section 2.06(d)(ii), the Trustee shall cancel such Restricted Definitive Note and increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof, the aggregate principal amount of the Unrestricted Global Note.
(iii) Transfer or Exchange of Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes . A holder of an Unrestricted Definitive Note may exchange such Unrestricted Definitive Note for a beneficial interest in an Unrestricted Global Note or transfer such Unrestricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Note and increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of one of the Unrestricted Global Notes.
(iv) Transfer or Exchange of Unrestricted Definitive Notes to Beneficial Interests in Restricted Global Notes Prohibited . An Unrestricted Definitive Note may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Note.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes . Upon request by a holder of Definitive Notes and such holders compliance with the provisions of this Section 2.06(e), the Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such holder. In addition, the requesting holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.06(e).
(i) Transfer of Restricted Definitive Notes to Restricted Definitive Notes . Any Restricted Definitive Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A, a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof;
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(B) if the transfer will be made pursuant to Rule 903 or Rule 904, a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable.
(ii) Transfer or Exchange of Restricted Definitive Notes to Unrestricted Definitive Notes . Any Restricted Definitive Note may be exchanged by the holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by a Registration Rights Agreement;
(B) any such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;
(C) any such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such Restricted Definitive Note proposes to exchange such Restricted Definitive Notes for an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(d) thereof; or
(2) if the holder of such Restricted Definitive Notes proposes to transfer such Restricted Definitive Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer complies with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses of this Section 2.06(e)(ii), the Trustee shall cancel the prior Restricted Definitive Note and the Company shall execute, and upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate aggregate principal amount to the Person designated by the holder of such prior Restricted Definitive Note in instructions delivered to the Registrar by such holder.
(iii) Transfer of Unrestricted Definitive Notes to Unrestricted Definitive Notes . A holder of Unrestricted Definitive Notes may transfer such Unrestricted Definitive Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a
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transfer, the Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the holder thereof.
(f) Exchange Offer . Upon the occurrence of an Exchange Offer in accordance with a Registration Rights Agreement, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate (A) one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of the beneficial interests in the applicable Restricted Global Notes (1) tendered for acceptance by Persons that make any and all certifications in the applicable Letters of Transmittal (or are deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement and (2) accepted for exchange in such Exchange Offer and (B) Unrestricted Definitive Notes in an aggregate principal amount equal to the aggregate principal amount of the Restricted Definitive Notes tendered for acceptance by Persons who made the foregoing certifications and accepted for exchange in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall reduce or cause to be reduced in a corresponding amount the aggregate principal amount of the applicable Restricted Global Notes, and the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver to the Persons designated by the holders of Restricted Definitive Notes so accepted Unrestricted Definitive Notes in the appropriate aggregate principal amount.
(g) Legends . The following legends shall appear on the face of all Global Notes and Definitive Notes issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend .
(A) Except as permitted by clause (B) below, each Global Note and each Definitive Note (and all Notes issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form:
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT), OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE RESALE RESTRICTION TERMINATION DATE), OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A INSIDE THE UNITED STATES, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (2) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF
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AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THIS TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS OFFSHORE TRANSACTION, UNITED STATES AND U.S. PERSON HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
(B) Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to clauses (b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) of this Section 2.06 (and all Notes issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend . Each Global Note shall bear a legend in substantially the following form:
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (DTC), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
(h) Cancellation and/or Adjustment of Global Notes . At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or cancelled in whole and not in part, each such Global Note shall be returned to or retained and cancelled by the Trustee in accordance with Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the aggregate principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, the aggregate principal amount of such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase.
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(i) General Provisions Relating to Transfers and Exchanges .
(i) No service charge shall be made to a holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 4.12, 4.18 and 9.05 hereof).
(ii) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of the Company, evidencing the same debt as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.
(iii) Neither the Registrar nor the Company shall be required (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the opening of business 15 days before the day of any selection of Notes for redemption under Section 3.02 hereof and ending at the close of business on the date of selection, (B) to register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part or (C) to register the transfer of or to exchange a Note between a record date (including a Regular Record Date) and the next succeeding Interest Payment Date.
(iv) Prior to due presentment for the registration of transfer of any Note, the Trustee, any Agent and the Company may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of, premium, if any, and interest on such Note and for all other purposes, in each case regardless of any notice to the contrary.
(v) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted by facsimile.
(vi) The Trustee is hereby authorized and directed to enter into a letter of representation with the Depositary in the form provided by the Company and to act in accordance with such letter.
SECTION 2.07 . REPLACEMENT NOTES .
If any mutilated Note is surrendered to the Trustee or the Company and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate a replacement Note. If required by the Trustee or the Company, the Holder of such Note shall provide indemnity that is sufficient, in the judgment of the Trustee or the Company, to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer in connection with such replacement. If required by the Company, such Holder shall reimburse the Company for its reasonable expenses in connection with such replacement.
Every replacement Note issued in accordance with this Section 2.07 shall be the valid obligation of the Company, evidencing the same debt as the destroyed, lost or stolen Note, and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.
SECTION 2.08 . OUTSTANDING NOTES .
(a) The Notes outstanding at any time shall be the entire principal amount of Notes represented by all of the Global Notes and Definitive Notes authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, those subject to reductions in beneficial interests effected by the Trustee in accordance with Section 2.06 hereof, and those described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a Note shall not cease to be outstanding because the Company or an Affiliate of the
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Company holds the Note; provided , however , that Notes held by the Company or a Subsidiary of the Company shall be deemed not to be outstanding for purposes of Section 3.07(b) hereof.
(b) If a Note is replaced pursuant to Section 2.07 hereof, it shall cease to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.
(c) If the principal amount of any Note is considered paid under Section 4.01 hereof, it shall cease to be outstanding and interest on it shall cease to accrue.
(d) If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date, a Purchase Date or a maturity date, funds sufficient to pay Notes payable on that date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest.
SECTION 2.09 . TREASURY NOTES .
In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company, or by any Affiliate of the Company, shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned shall be so disregarded.
SECTION 2.10 . TEMPORARY NOTES .
Until certificates representing Notes are ready for delivery, the Company may prepare and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate temporary Notes. Temporary Notes shall be substantially in the form of Definitive Notes but may have variations that the Company considers appropriate for temporary Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Global Notes or Definitive Notes in exchange for temporary Notes, as applicable.
Holders of temporary Notes shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.
SECTION 2.11 . CANCELLATION .
The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. Upon sole direction of the Company, the Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall dispose of such cancelled Notes (subject to the record retention requirements of the Exchange Act or other applicable laws) in its customary manner unless by written order, signed by an Officer of the Company, the Company directs them to be returned to it. The Company may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12 . PAYMENT OF INTEREST; DEFAULTED INTEREST .
If the Company defaults in a payment of interest on the Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Company shall fix or cause to be fixed each such special record date and payment date; provided that no such special record date shall be less than 10 days prior to the related Interest Payment Date for such defaulted interest. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense of the Company) shall mail or
36
cause to be mailed to Holders a notice that states the special record date, the related Interest Payment Date and the amount of such interest to be paid.
SECTION 2.13 . CUSIP OR ISIN NUMBERS .
The Company in issuing the Notes may use CUSIP and/or ISIN numbers (if then generally in use), and, if so, the Trustee shall use CUSIP and/or ISIN numbers in notices of redemption or Offers to Purchase as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption or notice of an Offer to Purchase and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption or Offer to Purchase shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee of any change in the CUSIP and/or ISIN numbers.
SECTION 2.14 . LIQUIDATED DAMAGES .
If Liquidated Damages are payable by the Company pursuant to a Registration Rights Agreement and paragraph 1 of the Notes, the Company shall deliver to the Trustee a certificate to that effect stating (i) the amount of such Liquidated Damages that is payable and (ii) the date on which such interest is payable pursuant to Section 4.01 hereof. Unless and until a Responsible Officer of the Trustee receives such a certificate or instruction or direction from the Holders in accordance with the terms of this Indenture, the Trustee may assume without inquiry that no Liquidated Damages are payable. The foregoing shall not prejudice the rights of the Holders with respect to their entitlement to Liquidated Damages as otherwise set forth in this Indenture or the Notes and pursuing any action against the Company directly or otherwise directing the Trustee to take any such action in accordance with the terms of this Indenture and the Notes. If the Company has paid Liquidated Damages directly to the Persons entitled to it, the Company shall deliver to the Trustee an Officers Certificate setting forth the details of such payment.
SECTION 2.15. ISSUANCE OF ADDITIONAL NOTES .
The Company shall be entitled, subject to its compliance with Section 4.09 hereof, to issue Additional Notes under this Indenture which shall have identical terms as the Initial Notes issued on the date hereof, other than with respect to the date of issuance, issue price and rights under a related Registration Rights Agreement, if any. The Initial Notes issued on the date hereof, any Additional Notes and all Exchange Notes issued in exchange therefor shall be treated as a single class for all purposes under this Indenture, including directions, waivers, amendments, consents, redemptions and Offers to Purchase.
With respect to any Additional Notes, the Company shall set forth in a Board Resolution and an Officers Certificate, a copy of each of which shall be delivered to the Trustee, the following information:
(a) the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture;
(b) the issue price, the issue date and the CUSIP and/or ISIN number of such Additional Notes; provided, however, that no Additional Notes may be issued at a price that would cause such Additional Notes to have original issue discount within the meaning of Section 1273 of the Code, other than a de minimis original issue discount within the meaning of Section 1273 of the Code; and
(c) whether such Additional Notes shall be subject to the restrictions on transfer set forth in Section 2.06 hereof relating to Restricted Global Notes and Restricted Definitive Notes.
37
SECTION 2.16 . RECORD DATE .
The record date for purposes of determining the identity of Holders of Notes entitled to vote or consent to any action by vote or consent or permitted under this Indenture shall be determined as provided for in TIA Section 316(c).
REDEMPTION AND PREPAYMENT
SECTION 3.01 . NOTICES TO TRUSTEE .
If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 30 days but not more than 60 days before a redemption date (or such shorter period as allowed by the Trustee), an Officers Certificate setting forth (a) the applicable section of this Indenture pursuant to which the redemption shall occur, (b) the redemption date, (c) the principal amount of Notes to be redeemed and (d) the redemption price.
SECTION 3.02 . SELECTION OF NOTES TO BE REDEEMED .
If less than all of the Notes are to be redeemed at any time, the Trustee shall select the Notes to be redeemed among the Holders of the Notes in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot or in accordance with any other method the Trustee deems fair and appropriate. In the event of partial redemption by lot, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of $1,000 or integral multiples thereof; except that if all of the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not an integral multiple of $1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption.
SECTION 3.03 . NOTICE OF REDEMPTION .
At least 30 days but not more than 60 days prior to a redemption date, the Company shall mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at such Holders registered address appearing in the Security Register.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the appropriate calculation of the redemption price, but need not include the redemption price itself; the actual redemption price shall be set forth in an Officers Certificate delivered to the Trustee no later than two (2) Business Days prior to the redemption date;
(c) if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the redemption date upon surrender of such Note, if applicable, a new Note or Notes in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
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(e) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment, interest on Notes called for redemption ceases to accrue on and after the redemption date;
(g) the applicable section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness of the CUSIP and/or ISIN numbers, if any, listed in such notice or printed on the Notes.
At the Companys request, the Trustee shall give the notice of redemption in the Companys name and at its expense; provided, however , that the Company shall have delivered to the Trustee, at least 45 days (or such shorter period allowed by the Trustee), prior to the redemption date, an Officers Certificate requesting that the Trustee give such notice (in the name and at the expense of the Company) and setting forth the information to be stated in such notice as provided in this Section 3.03.
SECTION 3.04 . EFFECT OF NOTICE OF REDEMPTION .
Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption shall become irrevocably due and payable on the redemption date at the redemption price. A notice of redemption may not be conditional.
SECTION 3.05 . DEPOSIT OF REDEMPTION PRICE .
On or prior to 11:00 a.m. Eastern time on the Business Day prior to any redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and, if applicable, accrued and unpaid interest on all Notes to be redeemed on that date. The Trustee or the Paying Agent shall promptly, and in any event within two (2) Business Days after the redemption date, return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption price of, and accrued and unpaid interest, if any, on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called for purchase or redemption in accordance with Section 2.08(d) hereof, whether or not such Notes are presented for payment. If a Note is redeemed on or after a Regular Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest, if any, shall be paid to the Person in whose name such Note was registered at the close of business on such Regular Record Date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal from the redemption date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof.
SECTION 3.06 . NOTES REDEEMED IN PART .
Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the Companys written request, the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered.
SECTION 3.07 . OPTIONAL REDEMPTION .
(a) Except as set forth in clause (b) of this Section 3.07, the Notes shall not be redeemable at the option of the Company prior to December 15, 2008. Beginning on December 15, 2008, the Company may redeem all or a portion of the Notes, at once or over time, after giving the notice required pursuant to Section 3.03 hereof, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid
39
interest and Liquidated Damages, if any, on the Notes redeemed, to the applicable redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date), if redeemed during the twelve-month period commencing on December 15 of the years indicated below:
Year |
|
Percentage |
|
2008 |
|
103.875 |
% |
2009 |
|
102.583 |
% |
2010 |
|
101.292 |
% |
2011 and thereafter |
|
100.000 |
% |
(b) At any time prior to December 15, 2006, the Company may (but will not have the obligation to) on any one or more occasions redeem up to 35% of the aggregate principal amount of the Notes issued under this Indenture at a redemption price (expressed as a percentage of principal amount) equal to 107.750% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date), with the net cash proceeds of one or more Equity Offerings, provided that at least 65% of the aggregate principal amount of the Notes initially issued under this Indenture remain outstanding immediately after the occurrence of the redemption (excluding Notes held by the Company and its Subsidiaries); provided , further , that the redemption shall occur within 180 days of the date of the closing of the Equity Offering.
(c) Any prepayment pursuant to this Section 3.07 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.
SECTION 3.08 . MANDATORY REDEMPTION .
Except as set forth in Sections 4.12 and 4.18 hereof, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes.
SECTION 3.09 . OFFER TO PURCHASE .
(a) In the event that, pursuant to Section 4.12 or 4.18 hereof, the Company shall be required to commence an Asset Sale Offer or Change of Control Offer (each, an Offer to Purchase ), it shall follow the procedures specified below.
(b) The Company shall cause a notice of the Offer to Purchase to be sent at least once to the Dow Jones News Service or similar business news service in the United States.
(c) The Company shall commence the Offer to Purchase by sending, by first-class mail, with a copy to the Trustee, to each Holder at such Holders address appearing in the Security Register, a notice the terms of which shall govern the Offer to Purchase stating:
(i) that the Offer to Purchase is being made pursuant to this Section 3.09 and Section 4.12 or Section 4.18, as the case may be, and, in the case of a Change of Control Offer, that a Change of Control has occurred, the circumstances and relevant facts regarding the Change of Control and that a Change of Control Offer is being made pursuant to Section 4.18;
(ii) the principal amount of Notes required to be purchased pursuant to Section 4.12 or Section 4.18, as the case may be (the Offer Amount ), the purchase price set forth in Section 4.12 or Section 4.18, as applicable, the Offer Period and the Purchase Date (each as defined below);
(iii) except as provided in clause (ix), that all Notes timely tendered and not withdrawn shall be accepted for payment;
(iv) that any Note not tendered or accepted for payment shall continue to accrue interest;
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(v) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Offer to Purchase shall cease to accrue interest after the Purchase Date;
(vi) that Holders electing to have a Note purchased pursuant to an Offer to Purchase may elect to have Notes purchased in integral multiples of $1,000 only;
(vii) that Holders electing to have a Note purchased pursuant to any Offer to Purchase shall be required to surrender the Note, with the form entitled Option of Holder to Elect Purchase on the reverse of the Note completed, or transfer by book-entry transfer, to the Company, the Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice before the close of business on the third Business Day before the Purchase Date;
(viii) that Holders shall be entitled to withdraw their election if the Company, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note (or portions thereof) the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(ix) that, in the case of an Asset Sale Offer, if the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000 or integral multiples thereof shall be purchased);
(x) that Holders whose Notes were purchased in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(xi) any other procedures the Holders must follow in order to tender their Notes (or portions thereof) for payment and the procedures that Holders must follow in order to withdraw an election to tender Notes (or portions thereof) for payment.
(d) The Offer to Purchase shall remain open for a period of at least 30 days but no more than 60 days following its commencement, except to the extent that a longer period is required by applicable law (the Offer Period ). No later than five (5) Business Days (and in any event no later than the 60th day following the Change of Control) after the termination of the Offer Period (the Purchase Date ), the Company shall purchase the Offer Amount or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Offer to Purchase. Payment for any Notes so purchased shall be made in the same manner as interest payments are made. The Company shall publicly announce the results of the Offer to Purchase on the Purchase Date.
(e) On or prior to the Purchase Date, the Company shall, to the extent lawful:
(i) accept for payment (on a pro rata basis to the extent necessary in connection with an Asset Sale Offer), the Offer Amount of Notes or portions of Notes properly tendered pursuant to the Offer to Purchase, or if less than the Offer Amount has been tendered, all Notes tendered;
(ii) deposit with the Paying Agent funds in an amount equal to the purchase price as set forth in Section 4.12 or Section 4.18, as applicable, in respect of all Notes or portions of Notes properly tendered; and
(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.09.
(f) The Depositary or the Paying Agent (or the Company, if acting as the Paying Agent), as the case may be, shall promptly (but in the case of a Change of Control, not later than 60 days from the date of the
41
Change of Control) deliver to each tendering Holder the purchase price as set forth in Section 4.12 or Section 4.18, as applicable. In the event that any portion of the Notes surrendered is not purchased by the Company, the Company shall promptly execute and issue a new Note in a principal amount equal to such unpurchased portion of the Note surrendered, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver (or cause to be transferred by book-entry) such new Note to such Holder; provided , however , that each such new Note shall be in a principal amount of $1,000 or an integral multiple thereof.
(g) If the Purchase Date is on or after a Regular Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such Regular Record Date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Offer to Purchase.
(h) The Company shall comply, to the extent applicable, with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the Offer to Purchase. To the extent that the provisions of any securities laws or regulations conflict with Sections 4.12 or 4.18, as applicable, this Section 3.09 or other provisions of this Indenture, the Company shall comply with applicable securities laws and regulations and shall not be deemed to have breached its obligations under Sections 4.12 or 4.18, as applicable, this Section 3.09 or such other provision by virtue of such compliance.
(i) Other than as specifically provided in this Section 3.09, any purchase pursuant to this Section 3.09 shall be made in accordance with the provisions of Section 3.01 through 3.06 hereof.
COVENANTS
SECTION 4.01 . PAYMENT OF NOTES .
The Company shall pay or cause to be paid the principal of, premium, if any, and interest on, the Notes on the dates and in the manner provided in this Indenture and the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. Such Paying Agent shall return to the Company promptly, and in any event, no later than five (5) Business Days following the date of payment, any money (including accrued interest) that exceeds such amount of principal, premium, if any, and interest paid on the Notes. The Company shall pay Liquidated Damages, if any, in the same manner, on the dates and in the amounts set forth in a Registration Rights Agreement, the Notes and the Indenture. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period.
The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful.
Interest shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 4.02 . MAINTENANCE OF OFFICE OR AGENCY .
(a) The Company shall maintain in the Borough of Manhattan, the city of New York, an office or agency (which may be an office or drop facility of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where Notes may be presented or surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. The Company shall
42
give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
(b) The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.
(c) The Company hereby designates the Corporate Trust Office of the Trustee, as one such office, drop facility or agency of the Company in accordance with Section 2.03 hereof.
SECTION 4.03 . REPORTS .
The Company will furnish to the Holders of Notes
(a) all quarterly and annual financial and other information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Company was required to file these Forms, including a Managements Discussion and Analysis of Financial Condition and Results of Operations that describes the financial condition and results of operations of the Company and its consolidated Subsidiaries (showing in reasonable detail, either on the face of the financial statements or in the footnotes, the financial condition and results of operations of the Company and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company) and, with respect to the annual information only, a report thereon by the Companys certified independent accountants and
(b) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file these reports, in each case within the time periods specified in the Commissions rules and regulations;
provided , however , that the first report to be furnished pursuant to this paragraph shall be the Annual Report of the Company for the year ended December 31, 2003, which shall be furnished as soon as is reasonably practicable following the end of the period covered by that report but in no event later than March 31, 2004; provided , further , that the Company will not be required to furnish such information to the Trustee or the registered holders of the Notes to the extent such information is electronically filed with the Commission and is electronically available to the public free of cost. Notwithstanding the foregoing, such requirements shall be deemed satisfied prior to the commencement of the Exchange Offer or the effectiveness of the Shelf Registration Statement by the filing with the Commission of the Exchange Offer Registration Statement and/or Shelf Registration Statement, and any amendments thereto, with such financial information that satisfies Regulation S-X of the Securities Act.
In addition, following the consummation of the Exchange Offer, whether or not required by the rules and regulations of the Commission, the Company will file a copy of all such information and reports with the Commission for public availability within the time periods specified in the Commissions rules and regulations (unless the Commission will not accept the filing) and make such information available to securities analysts and prospective investors upon request.
In addition, (i) at all times the Commission does not accept the filings provided for in the preceding sentence or (ii) the filings provided for in the preceding sentence do not contain the information required to be delivered upon request pursuant to Rule 144A(d)(4) under the Securities Act, then, in each case, the Company has agreed that, for so long as any Notes remain outstanding, it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
43
SECTION 4.04 . COMPLIANCE CERTIFICATE .
(a) The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year, an Officers Certificate stating that a review of the activities of the Company, the Subsidiary Guarantors and their respective Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company, the Subsidiary Guarantors and their respective Subsidiaries have kept, observed, performed and fulfilled their obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge the Company, the Subsidiary Guarantors and their respective Subsidiaries have kept, observed, performed and fulfilled each and every covenant contained in this Indenture and are not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of, premium, if any, or interest on the Notes is prohibited or if such event has occurred, a description of the event and what action the Company is taking or proposes to take with respect thereto.
(b) The Company shall otherwise comply with TIA §314(a)(2).
(c) The Company shall deliver to the Trustee, upon any Officer of the Company becoming aware thereof, written notice in the form of an Officers Certificate of any Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto.
SECTION 4.05 . TAXES .
The Company shall pay, and shall cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments and governmental levies, except such as are being contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders.
SECTION 4.06 . STAY, EXTENSION AND USURY LAWS .
The Company and the Subsidiary Guarantors covenant (to the extent that they may lawfully do so) that they shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company and the Subsidiary Guarantors (to the extent that they may lawfully do so) hereby expressly waive all benefit or advantage of any such law, and covenant that they shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted.
SECTION 4.07 . CORPORATE EXISTENCE .
Subject to Article 5 hereof, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its corporate existence, and the corporate, partnership or other existence of each Restricted Subsidiary, in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses and franchises of the Company and its Restricted Subsidiaries; provided, however , that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any Restricted Subsidiary, if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders of the Notes, or that such preservation is not necessary in connection with any transaction not prohibited by this Indenture.
44
SECTION 4.08 . PAYMENTS FOR CONSENT .
Neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder of any Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless the consideration is offered to be paid or is paid to all Holders of the Notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to the consent, waiver or agreement.
SECTION 4.09 . INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED STOCK .
The Company will not, and will not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, Guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, incur ) any Indebtedness (including Acquired Debt), and the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided , however , that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock and the Companys Subsidiaries may incur Indebtedness or issue shares of preferred stock if the Fixed Charge Coverage Ratio for the Companys most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which the additional Indebtedness is incurred or the Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred, or the Disqualified Stock or preferred stock had been issued, as the case may be, at the beginning of such four-quarter period.
The provisions of the first paragraph of this Section 4.09 will not apply to the incurrence of any of the following items of Indebtedness (collectively, Permitted Debt ):
(i) the incurrence by the Company or any Restricted Subsidiary of Indebtedness and reimbursement obligations under letters of credit under the Credit Facilities (including any Guarantee of the Indebtedness by any Restricted Subsidiary); provided that the aggregate principal amount of all Indebtedness outstanding under all Credit Facilities after giving effect to the incurrence does not exceed an amount equal to $120.3 million (with letters of credit being deemed to have a principal amount equal to the maximum face amount thereunder) plus (in the case of any refinancing) the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with the refinancing, less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary to repay any term Indebtedness under Credit Facilities pursuant to Section 4.12;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness (including, but not limited to, Indebtedness outstanding under the Equipment Financing Facility);
(iii) the incurrence by the Company and the Subsidiary Guarantors of Indebtedness evidenced by the Initial Notes and related Subsidiary Guarantees, and any Exchange Notes and related Subsidiary Guarantees issued in respect of Notes outstanding under this Indenture;
(iv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage or construction financings or purchase money obligations or similar financings or refinancings thereof, in each case incurred for the purpose of financing or refinancing all or any part of the purchase price or cost of design, installation, construction, repair or improvement of property (real or personal), plant or equipment used in the business of the Company or any Restricted Subsidiary (whether through the direct acquisition, construction, repair or improvement of such assets or the acquisition of Equity Interests of any Person acquiring, constructing, repairing, improving or otherwise owning such assets), in an aggregate principal amount (which amount may, but need not, be incurred in whole or in part under the Credit Facilities) not to exceed the greater of: (a) $30.0 million or (b) 10% of Total Tangible Assets (measured at the time of each incurrence of any such Indebtedness), in either case outstanding at any time;
45
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph hereof or clauses (ii), (iii), (v) and (xvi) of this paragraph;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided , however , that (i) if the Company is the obligor on this Indebtedness, the Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and (ii)(A) any subsequent issuance or transfer of Equity Interests that results in any Indebtedness being held by a Person other than the Company or a Restricted Subsidiary and (B) any sale or other transfer of any Indebtedness to a Person that is not either the Company or a Restricted Subsidiary shall be deemed, in each case, to constitute an incurrence of Indebtedness by the Company or the Restricted Subsidiary, as the case may be, that was not permitted by this clause (vi);
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations (other than for speculative purposes);
(viii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness (in addition to Indebtedness permitted by other clauses of this paragraph) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (viii), not to exceed $25.0 million;
(ix) the incurrence by the Companys Unrestricted Subsidiaries of Non-Recourse Debt, provided , however , that if any of this Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, that event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (ix);
(x) the Guarantee by the Company or any Restricted Subsidiary of Indebtedness of the Company or a Restricted Subsidiary, which Indebtedness was permitted to be incurred by another provision of this Section 4.09; provided that in the case of a Guarantee by any Restricted Subsidiary that is not a Subsidiary Guarantor, such Restricted Subsidiary complies with Section 4.16;
(xi) Indebtedness of the Company or a Restricted Subsidiary owed to (including obligations in respect of letters of credit for the benefit of) any Person in connection with workers compensation, health, disability or other employee benefits or property, casualty or liability insurance provided by such Person to the Company or the Restricted Subsidiary, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business and consistent with past practices;
(xii) the incurrence of Permitted Bonding Obligations;
(xiii) [intentionally omitted]
(xiv) the incurrence of Indebtedness arising from agreements of the Company or any Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business, assets or Capital Stock of a Restricted Subsidiary; provided that with respect to any such disposition, the maximum aggregate liability of this Indebtedness shall at no time exceed the gross proceeds actually received by the Company and its Restricted Subsidiaries in connection with any such disposition;
(xv) the issuance by any of the Companys Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided , however , that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
46
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company;
will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (xv);
(xvi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness (in addition to Indebtedness permitted by other clauses of this paragraph) to finance the repurchase of the Designated Vessels, which are presently utilized by the Company or a Restricted Subsidiary under operating leases, in each case on terms not materially less favorable on the whole than those set forth in the repurchase provisions contained in such operating leases as in effect as of the date of this Indenture; and
(xvii) the Guarantee by the Company or a Restricted Subsidiary of Indebtedness of Amboy Aggregates provided that the maximum liability of the Company or a Restricted Subsidiary thereunder does not exceed $5.0 million at any time.
For purposes of determining compliance with this Section 4.09, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xvii) above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall, in its sole discretion, classify (or later reclassify in whole or in part, in its sole discretion) that item of Indebtedness in any manner that complies with this Section 4.09. Accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided , in each case, that the amount is included in Fixed Charges of the Company as accrued. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The principal amount of any Indebtedness supported by a letter of credit issued under a Credit Facility in accordance with clause (1) above shall not be deemed a separate incurrence of Indebtedness for purposes of this Section 4.09, but only to the extent of the stated amount of such letter of credit.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted valued of the Indebtedness in the case of any Indebtedness issued with original issue discount;
(2) the maximum fixed redemption liability with respect to any Disqualified Stock or preferred stock of a Restricted Subsidiary;
(3) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(4) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the Fair Market Value of such asset at the date of determination, and
(b) the amount of the Indebtedness of the other Person.
SECTION 4.10 . RESTRICTED PAYMENTS .
The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:
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(i) declare or pay any dividend or make any other payment or distribution on account of the Companys or any of its Restricted Subsidiaries Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Companys or any of its Restricted Subsidiaries Equity Interests in their capacity as such (other than, in each case, dividends or distributions payable in Equity Interests (other than Disqualified Stock) of the Company or dividends or distributions payable to the Company or a Restricted Subsidiary of the Company);
(ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company) any Equity Interests of the Company (other than Equity Interests owned by the Company or any Restricted Subsidiary of the Company) or any direct or indirect parent of the Company;
(iii) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness of the Company that is contractually subordinated to the Notes or to the Subsidiary Guarantees (other than any subordinated Indebtedness held by the Company or any Restricted Subsidiary), except a payment of interest or principal at Stated Maturity; or
(iv) make any Restricted Investment
(all these payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as Restricted Payments ) , unless:
(a) at the time of and after giving effect to the Restricted Payment, no Default or Event of Default shall have occurred and is continuing or would occur as a consequence of the Restricted Payment; and
(b) the Company would, at the time of the Restricted Payment and after giving it pro forma effect as if the Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of Section 4.09; and
(c) the Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the date of this Indenture (excluding Restricted Payments permitted by clauses (ii), (iii), (iv), (vii), (viii), (xi), (xii), (xiii), (xv) and (xvi) of the next succeeding paragraph), is less than the sum, without duplication, of
(i) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from October 1, 2003 to the end of the Companys most recently ended fiscal quarter for which internal financial statements are available at the time of the Restricted Payment (or, if Consolidated Net Income for the period is a deficit, less 100% of the deficit); provided , however , that if, after giving effect to the proposed Restricted Payment (and the financing thereof), the Consolidated Leverage Ratio would be less than 3.0 to 1.0, then for purposes of calculating the availability of amounts hereunder for such Restricted Payment only, the reference to 50% in this clause (c)(i) shall be deemed to be 75%, plus
(ii) 100% of the aggregate fair market value of Qualified Proceeds received by the Company since the date of this Indenture as a contribution to its equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock) or from the issue or sale of Disqualified Stock or debt securities of the Company that have been converted into Equity Interests (other than Equity Interests (or Disqualified Stock or convertible debt securities) sold to a Subsidiary of the Company), plus
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(iii) to the extent that any Restricted Investment that was made after the date of this Indenture is sold for cash or otherwise liquidated or repaid for cash, the cash return of capital received with respect to the Restricted Investment (less the cost of disposition, if any), plus
(iv) 50% of any dividends received by the Company or a Wholly Owned Restricted Subsidiary after the date of this Indenture from an Unrestricted Subsidiary of the Company, to the extent that the dividends were not otherwise included in Consolidated Net Income of the Company for the period, plus
(v) to the extent that any Unrestricted Subsidiary is redesignated as a Restricted Subsidiary, or upon a merger or consolidation of any Unrestricted Subsidiary into the Company or any of its Restricted Subsidiaries, in each case after the date of this Indenture, the lesser of (A) the fair market value of the Companys Investment in the Subsidiary as of the date of the redesignation or merger or consolidation and (B) the fair market value as of the date on which the Subsidiary was originally designated as an Unrestricted Subsidiary.
The foregoing provisions will not prohibit:
(i) the payment of any dividend or other distribution within 60 days after the date of declaration, if at said date of declaration payment would have complied with the provisions of this Indenture;
(ii) the making of any Restricted Payment in exchange for, or out of the net cash proceeds of the sale within 30 days of the making of such Restricted Payment (other than to a Subsidiary of the Company) of, other Equity Interests of the Company (other than any Disqualified Stock) or the net cash proceeds of a common equity capital contribution to the Company; provided that the amount of any net cash proceeds that are utilized for any Restricted Payment pursuant to this clause (ii) shall be excluded from clause (c)(ii) of the preceding paragraph;
(iii) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
(iv) the payment of any dividend or making of any distribution by a Subsidiary of the Company to the holders of its Equity Interests on a pro rata basis;
(v) so long as no Default or Event of Default shall have occurred and is continuing or would occur as a result of the making of such Restricted Payment, the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company or any direct or indirect parent of the Company held by any present, future or former member of the Companys or any direct or indirect parent of the Companys (or any of their Subsidiaries) Board of Directors or any present, future or former officer, employee or director of the Company, any of its Restricted Subsidiaries or any direct or indirect parent of the Company pursuant to any equity subscription agreement, stockholder agreement, stock option agreement, employment agreement or other similar agreements or employee benefit plan; provided that
(A) the aggregate price paid for all the repurchased, redeemed, acquired or retired Equity Interests shall not exceed $3.0 million in any calendar year (with unused amounts in any calendar year being carried over to succeeding calendar years subject to a maximum (without giving effect to clause (B)) of $6.0 million), plus
(B) in the case of a repurchase, redemption or other acquisition or retirement of Equity Interests of the Company or of any direct or indirect parent of the Company, the aggregate cash proceeds received by the Company, or its direct or indirect parent to the extent such cash proceeds are contributed to the common equity capital of the Company, during that calendar year from any reissuance of Equity Interests by the Company or any direct or indirect parent of the Company to employees, officers and directors of the Company and its Restricted Subsidiaries plus the cash proceeds of any key man life insurance policy received by the Company, and any cash proceeds paid to the
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Company in connection with the issuance or exercise of, any management or employee Equity Interests so acquired;
(vi) so long as no Default or Event of Default has occurred and is continuing or would occur as a result of the making of such Restricted Payment, the declaration and payment of regularly scheduled dividends to holders of any class or series of Disqualified Stock of the Company, or any class or series of Disqualified Stock or preferred stock of any Restricted Subsidiary that was issued after the date of this Indenture (other than to the Company or another Wholly Owned Restricted Subsidiary of the Company) in compliance with Section 4.09;
(vii) repurchase of Equity Interests deemed to occur upon exercise of stock options and warrants if those Equity Interests represent a portion of the exercise price of the options or warrants;
(viii) loans to employees of the Company or any Restricted Subsidiary in the ordinary course of business not to exceed $2.0 million at any one time outstanding;
(ix) so long as no Default or Event of Default shall have occurred and is continuing or would occur as a result of the making of such Restricted Payment, Restricted Payments not to exceed $10.0 million since the date of this Indenture;
(x) [intentionally omitted]
(xi) any payments made by the Company or a Restricted Subsidiary in connection with the Transactions and described in this Offering Memorandum under the caption Use of Proceeds (including any post-closing purchase price adjustments);
(xii) payments, advances, loans or expense reimbursements made to any direct or indirect parent corporation of the Company to permit the payment by such entity of reasonable general operating expenses, accounting, legal, corporate reporting and administrative expenses incurred in the ordinary course of its business in an amount not to exceed $1.0 million per annum (or $2.0 million per annum after the consummation of an Initial Pubic Offering by the Company or any direct or indirect parent of the Company);
(xiii) (a) for so long as the Company is a member of a group filing a consolidated or combined tax return with a parent corporation, payments to the parent in respect of an allocable portion of the tax liabilities of such group that is attributable to the Company and its Subsidiaries ( Tax Payments ); provided , that the Tax Payments shall not exceed the lesser of (A) the amount of the relevant tax (including any penalties and interest) that the Company would owe if the Company were filing (and had always filed) a separate tax return (or a separate consolidated or combined return with its Subsidiaries that are members of the consolidated or combined group), taking into account any carryovers and carrybacks of tax attributes (such as net operating losses) of the Company and such Subsidiaries from other taxable years and (B) the proportionate share of the Company and its Subsidiaries of the net amount of the relevant tax that the parent actually owes to the appropriate taxing authority or (b) in the event that and for so long as the Company is organized as a limited liability company or partnership, the payment of Permitted Tax Distributions;
(xiv) the repurchase, redemption or other acquisition or retirement for value of Indebtedness that is subordinated to the Notes with Excess Proceeds to the extent such Excess Proceeds are permitted to be used for general corporate purposes under Section 4.12;
(xv) the repurchase, redemption or other acquisition for value of Capital Stock of the Company or any direct or indirect parent of the Company representing fractional shares of such Capital Stock in connection with a merger, consolidation, amalgamation or other combination involving the Company or any direct or indirect parent of the Company;
(xvi) Investments that are made with Excluded Contributions;
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(xvii) so long as no Default or Event of Default shall have occurred and is continuing or would occur as the result of making such Restricted Payment, upon the occurrence of a Change of Control and within 60 days after completion of the offer to repurchase Notes pursuant to Section 4.18 (including the purchase of all Notes tendered), any purchase or redemption of Indebtedness of the Company subordinated to the Notes that is required to be repurchased or redeemed pursuant to the terms thereof as a result of such Change of Control, at a purchase price not greater than 101% of the outstanding principal amount (or accreted amount, in the case of any debt issued at a discount from its principal amount at maturity) thereof, plus accrued and unpaid interest, if any; and
(xviii) so long as no Default or Event of Default has occurred and is continuing or would occur as the result of the making of such Restricted Payment, the declaration and payment of dividends to holders of any class or series of preferred stock of the Company if the Company would have been entitled to incur or assume Indebtedness under Section 4.09, in an aggregate principal amount equal to the aggregate liquidation value of the preferred stock at the time of issuance of such preferred stock ( provided that the cash proceeds from the issuance of such preferred stock shall be excluded from clause (c)(ii) of the preceding paragraph).
The Board of Directors may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default. For purposes of making this determination, all outstanding Investments by the Company and its Restricted Subsidiaries (except to the extent repaid in cash) in the Subsidiary so designated will be deemed to be Restricted Payments at the time of the designation and will reduce the amount available for Restricted Payments under the first paragraph of this Section 4.10. All outstanding Investments will be deemed to constitute Investments in an amount equal to the fair market value of the Investments at the time of the designation. Such designation will only be permitted if a Restricted Payment in that amount would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
For purposes of determining compliance with this Section 4.10, in the event that a Restricted Payment meets the criteria of more than one of the exceptions described in (i) through (xviii) above or is entitled to be made pursuant to the first paragraph of this Section 4.10, the Company shall, in its sole discretion, classify the Restricted Payment in any manner that complies with this Section 4.10. The amount of all Restricted Payments (other than cash) shall be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or the Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any non-cash Restricted Payment or return of capital on any Restricted Subsidiary shall be determined by the Board of Directors whose resolution regarding the fair market value shall be delivered to the Trustee, the determination to be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if the fair market value exceeds $10.0 million. Not later than the 30 days after the date of making any Restricted Payment, the Company shall deliver to the Trustee an Officers Certificate stating that the Restricted Payment is permitted and setting forth the basis upon which the calculations required by Section 4.10 were computed, together with a copy of any fairness opinion or appraisal required by this Indenture.
SECTION 4.11 . LIENS .
The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien securing Indebtedness or trade payables on any asset now owned or hereafter acquired, including any income or profits therefrom, except (i) Permitted Liens, and (ii) in the case of Liens securing Indebtedness that is expressly subordinate or junior in right of payment to the Notes, the Notes are secured by a Lien on property, assets or proceeds that is senior in priority to the Liens (with the same relative priority as the subordinate or junior Indebtedness shall have with respect to the Notes and the Subsidiary Guarantees) and (y) in all other cases, the Notes are secured by the Lien on an equal and ratable basis.
SECTION 4.12 . ASSET SALES .
The Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:
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(i) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of;
(ii) in the event of an Asset Sale involving assets or consideration in excess of $5.0 million, such fair market value is determined by the Companys Chief Financial Officer (or by its Board of Directors, as evidenced by a resolution of the Board of Directors, if such fair market value exceeds $10.0 million) and evidenced by an Officers Certificate delivered to the Trustee; and
(iii) at least 75% of the consideration therefor received by the Company or the Restricted Subsidiary is in the form of Qualified Proceeds.
For the purposes of this provision, each of the following shall be deemed cash:
(a) any liabilities (as shown on the Companys or the Restricted Subsidiarys most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Guarantee of the Notes) that are assumed by the transferee of any assets pursuant to a customary novation agreement or by operation of law that releases the Company or the Restricted Subsidiary from further liability;
(b) any securities, notes or other obligations received by the Company or the Restricted Subsidiary from a transferee that are converted by the Company or the Restricted Subsidiary into cash (to the extent of the cash received) within 180 days following the closing of the Asset Sale; and
(c) any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Sale having an aggregate fair market value (determined as provided in clause (ii) of the first paragraph above), taken together with all other Designated Noncash Consideration received pursuant to this clause (c) then outstanding, not to exceed the greater of (x) $10 million and (y) 5% of Total Tangible Assets at the time of receipt of such Designated Noncash Consideration with the fair market value of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value.
Within 360 days after the receipt of any Net Proceeds from an Asset Sale, the Company or any Restricted Subsidiary may apply the Net Proceeds, at its option,
(a) to prepay, repay or purchase Senior Debt,
(b) to the acquisition of a majority of the assets of, or a majority of the Voting Stock of, another Permitted Business, to making a capital expenditure for the construction, repair, improvement or acquisition of assets that are used or useful in a Permitted Business or (commitment to do any of the foregoing provided that this commitment or its reasonable replacement is consummated substantially in accordance with the terms) or
(c) for a combination of uses described in clauses (a) and (b).
Pending the final application of any Net Proceeds, the Company and its Restricted Subsidiaries may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Indenture. Any Net Proceeds from Asset Sales that are not applied or invested as provided in the immediately preceding paragraph will be deemed to constitute Excess Proceeds . When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company will be required to make an offer to all Holders of Notes (an Asset Sale Offer ) to purchase the maximum principal amount of Notes and, if the Company is required to do so under the terms of any other Indebtedness that is pari passu with the Notes, such other Indebtedness on a pro rata basis with the Notes, that may be purchased out of the Excess Proceeds, at an offer price in cash in an amount equal to 100% of the principal amount of the Notes plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the date of repurchase, in accordance with the procedures set forth in this Indenture. To the extent that any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use the Excess Proceeds for
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any general corporate purpose. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.
SECTION 4.13 . DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES .
The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any Restricted Subsidiary to
(i) (a) pay dividends or make any other distributions to the Company or any of its Restricted Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest or participation in, or measured by, its profits, or (b) pay any Indebtedness owed to the Company or any of its Restricted Subsidiaries,
(ii) make loans or advances to the Company or any of its Restricted Subsidiaries, or
(iii) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.
However, the foregoing restrictions will not apply to encumbrances or restrictions existing under or by reason of:
(a) Existing Indebtedness as in effect on the date of this Indenture,
(b) the New Credit Facility, the Equipment Financing Facility and Permitted Bonding Obligations as in effect as of the date of this Indenture, and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings, provided that any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are not materially more restrictive, taken as a whole, with respect to dividend and other payment restrictions than those contained in the New Credit Facility, the Equipment Financing Facility or in agreements with respect to Permitted Bonding Obligations, as applicable, as in effect on the date of this Indenture,
(c) this Indenture, the Notes (including the Exchange Notes) and the Subsidiary Guarantees (including the Subsidiary Guarantees of the Exchange Notes),
(d) applicable law, rule, regulation or order,
(e) any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of acquisition (except to the extent the Indebtedness was incurred in connection with or in contemplation of the acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that, in the case of Indebtedness, the Indebtedness was permitted by the terms of this Indenture to be incurred,
(f) customary non-assignment provisions in leases, licenses, charters or other similar agreements entered into in the ordinary course of business;
(g) purchase money obligations for property acquired in the ordinary course of business that impose restrictions of the nature described in clause (iii) above on the property so acquired,
(h) any agreement for the sale of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale,
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(i) Permitted Refinancing Indebtedness, provided that the restrictions contained in the agreements governing Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced,
(j) secured Indebtedness otherwise permitted to be incurred pursuant to the provisions of Section 4.09 and Section 4.11 that limits the right of the debtor to dispose of the assets (including any insurance, leases and charters relating to such assets, and any proceeds thereof) securing the Indebtedness,
(k) provisions with respect to the disposition or distribution of assets or property in joint venture agreements and other similar agreements entered into in the ordinary course of business,
(1) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business,
(m) mortgage, construction, purchase money or similar financings that impose restrictions on the transfer of the property acquired, constructed repaired or improved,
(n) encumbrances or restrictions imposed by amendments to the contracts, agreements or obligations referred to in the foregoing clauses (a), (c), (e), (f), (g), (h), (j), (k) and (m), provided that the amendments are not materially more restrictive than the agreement so amended,
(o) any other agreement, instrument or document relating to Senior Debt hereafter in effect, provided , that the terms and conditions of such encumbrances or restrictions are not materially more restrictive taken as a whole than those encumbrances or restrictions imposed in connection with the New Credit Facility as in effect on the date of this Indenture (which may result in encumbrances or restrictions upon a Restricted Subsidiary so long as such encumbrances or restrictions are not materially more restrictive taken as a whole than the comparable restriction that is applicable to the Company), or
(p) encumbrances or restrictions contained in any Indebtedness incurred by a Foreign Restricted Subsidiary that apply only to such Foreign Restricted Subsidiary.
SECTION 4.14 . TRANSACTIONS WITH AFFILIATES .
The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an Affiliate Transaction ), unless
(i) the Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or Restricted Subsidiary with an unrelated Person and
(ii) the Company delivers to the Trustee
(a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $2.0 million, a resolution of the Board of Directors of the Company set forth in an Officers Certificate certifying that the Affiliate Transaction complies with clause (i) above and that the Affiliate Transaction has been approved by a majority of the members of the Board of Directors of the Company (and, if there are disinterested directors, a majority thereof) and
(b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $10.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary of the Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing.
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Notwithstanding the foregoing, the following items shall not be deemed to be Affiliate Transactions:
(i) any employment agreement, compensation, employee benefit arrangements and incentive arrangements or indemnification agreement or arrangement with any officer, director, member or employee entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business of the Company or the Restricted Subsidiary;
(ii) transactions between or among the Company and/or its Restricted Subsidiaries;
(iii) payment of reasonable directors fees and customary indemnification agreements with directors and officers of the Company and its Restricted Subsidiaries or any direct or indirect parent of the Company;
(iv) Restricted Payments that are permitted by Section 4.10;
(v) loans and advances to officers, directors and employees of the Company or any Restricted Subsidiary for travel, entertainment, moving and other relocation expenses, in each case made in the ordinary course of business,
(vi) transactions pursuant to the Merger Agreement, including the payment of all fees and expenses described in the Offering Memorandum under Certain Relationships and Related Transactions, in each case, as in effect on the date of this Indenture;
(vii) transactions with a Person (other than an Unrestricted Subsidiary of the Company) that is an Affiliate of the Company solely because the Company owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person;
(viii) the issuance of Equity Interests (other than Disqualified Stock) of the Company to any direct or indirect parent of the Company or any Principal;
(ix) transactions with customers, clients, suppliers or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are on terms no less favorable than those that would have been obtained in a comparable transaction with an unrelated party or on terms that are approved by the Board of Directors of the Company, including a majority of the disinterested directors, if any;
(x) transactions pursuant to any contract or agreement described in the Offering Memorandum under the caption Certain Relationships and Related Transactions, as in effect on the date of this Indenture, in each case as amended, modified or replaced from time to time so long as the amended, modified or new agreements, taken as a whole, are no less favorable to the Company and its Restricted Subsidiaries than those in effect on the date of this Indenture;
(xi) so long as no Default or Event of Default that has occurred and is continuing, the payment of customary annual fees and related expenses to Madison Dearborn Partners and its Affiliates; provided that such fees shall not, in the aggregate, exceed $1.0 million (plus out-of-pocket expenses) in any twelve-month period commencing after the date of this Indenture;
(xii) so long as no Default or Event of Default has occurred and is continuing, the payment of customary transaction, management, consulting and advisory fees and related expenses to Madison Dearborn Partners and its Affiliates made pursuant to financial advisory, financing, underwriting or replacement agreements or in respect of other investment banking entities, including, without limitation, in connection with acquisitions or divestitures, in each case, which payments are (a) reasonably related to the services performed and (b) approved by a majority of the members of the Board of Directors not affiliated with Madison Dearborn Partners; and
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(xiii) any payments or other transactions pursuant to any tax-sharing agreement between the Company and any other Person with which the Company files a consolidated tax return or with which the Company is part of a consolidated group for tax purposes.
Section 4.15 . NO SENIOR SUBORDINATED DEBT .
The Company will not incur, create, issue, assume, guarantee or otherwise become liable for any Indebtedness that is subordinate or junior in right of payment to any Indebtedness and senior in any respect in right of payment to the Notes. No Subsidiary Guarantor will incur, create, issue, assume, guarantee or otherwise become liable for any Indebtedness that is subordinate or junior in right of payment to any Indebtedness of the Subsidiary Guarantor and senior in any respect in right of payment to the Subsidiary Guarantee of the Subsidiary Guarantor. This does not apply to distinctions between categories of Indebtedness that exist by reasons of any Liens or Guarantees securing or in favor of some but not all of such Indebtedness or securing such Indebtedness with greater or lesser priority or with different collateral.
SECTION 4.16 . LIMITATION ON ISSUANCE OF GUARANTEES OF INDEBTEDNESS .
Each Restricted Subsidiary may Guarantee the Obligations under the New Credit Facility and any other Indebtedness of the Company or a Subsidiary Guarantor, provided that, if the Restricted Subsidiary is not a Subsidiary Guarantor, the Restricted Subsidiary will be obligated to execute and deliver a supplemental indenture to this Indenture providing for the Subsidiary Guarantee of the payment of the Notes by the Restricted Subsidiary, which Subsidiary Guarantee shall be senior to or pari passu with the Subsidiarys Guarantee of the other Indebtedness, unless the other Indebtedness is Senior Debt, in which case the Subsidiary Guarantee of the Notes may be subordinated to the Guarantee of the Senior Debt to the same extent as the Notes are subordinated to the Senior Debt. Any such Subsidiary Guarantee shall provide by its terms that it shall be automatically and unconditionally released and discharged as described in Article 10.
SECTION 4.17 . DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES .
The Companys Board of Directors may designate any of its Subsidiaries, including any newly formed Subsidiary or any Person that will become a Subsidiary by way of acquisition, to be an Unrestricted Subsidiary if that designation would not cause a Default. If any of the Companys Restricted Subsidiaries is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the newly designated Unrestricted Subsidiary shall be deemed to be an Investment made as of the time of that designation and shall either reduce the amount available for Restricted Payments under Section 4.10(iv)(c) or reduce the amount available for future Investments under one or more clauses of the definition of Permitted Investments, as the Company determines in its sole discretion. The designation of such a Subsidiary or Person as an Unrestricted Subsidiary will be permitted only if, in the case of a Restricted Subsidiary, the deemed Investment would be permitted at the time the Restricted Subsidiary is designated as an Unrestricted Subsidiary and, in any case, if that Subsidiary or Person otherwise satisfies the requirements set forth in the definition of Unrestricted Subsidiary.
Any designation by the Board of Directors of an Unrestricted Subsidiary shall be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution giving effect to the designation and an Officers Certificate certifying that the designation complied with the foregoing conditions and was permitted by Section 4.10. If, at any time, any Unrestricted Subsidiary would fail to meet the foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture, and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Company as of such date (and, if such Indebtedness is not permitted to be incurred under Section 4.09, the Company shall be in default of Section 4.09). The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation shall be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and the designation shall only be permitted if (i) such Indebtedness is permitted under Section 4.09, calculated on a pro forma basis as if the designation had occurred at the beginning of the four-quarter reference period, and (ii) no Default or Event of Default would be in existence following the designation.
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SECTION 4.18 . REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL .
(a) Upon the occurrence of a Change of Control, the Company shall, within 30 days of a Change of Control, make an offer (the Change of Control Offer ) pursuant to the procedures set forth in Section 3.09. Each Holder shall have the right to accept such offer and require the Company to repurchase all or any portion (equal to $1,000 or an integral multiple of $1,000) of such Holders Notes pursuant to the Change of Control Offer at a purchase price, in cash (the Change of Control Payment ), equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest and Liquidated Damages, if any, on the Notes repurchased, to the Purchase Date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date).
(b) Prior to complying with any of the provisions of this Section 4.18, but in any event within 90 days following a Change of Control, the Company will either repay all outstanding Senior Debt or obtain the requisite consents, if any, under all agreements governing outstanding Senior Debt to permit the repurchase of Notes required by this Section 4.18.
(c) The Company will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under the Change of Control Offer or (2) notice of redemption has been given pursuant to this Indenture as described in Section 3.07, unless and until there has been a default in payment of the applicable redemption price. A Change of Control Offer may be made in advance of a Change of Control or conditional upon a Change of Control if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.
SECTION 4.19 . ADDITIONAL SUBSIDIARY GUARANTEES .
If the Company or any of its Restricted Subsidiaries shall acquire or create another Domestic Subsidiary after the date of this Indenture that at any time is or becomes a Material Subsidiary, then, unless that Subsidiary is properly designated as an Unrestricted Subsidiary, the newly acquired or created Subsidiary shall become a Subsidiary Guarantor and execute a supplemental indenture and deliver an Opinion of Counsel, in accordance with the terms of this Indenture within 20 business days of the first date after which it was acquired or created and constitutes a Material Subsidiary.
SECTION 4.20 . BUSINESS ACTIVITIES .
The Company will not, and will not permit any Restricted Subsidiary to, engage in any business other than Permitted Businesses, except to the extent as would not be material to the Company and its Restricted Subsidiaries taken as a whole.
SUCCESSORS
SECTION 5.01 . MERGER, CONSOLIDATION AND SALE OF ASSETS
The Company may not consolidate or merge with or into (whether or not the Company is the surviving corporation), or sell, assign, transfer, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions, to another Person unless
(i) the Company is the surviving corporation or the entity or the Person formed by or surviving the consolidation or merger (if other than the Company) or to which the sale, assignment, transfer, lease, conveyance or other disposition shall have been made is a corporation, limited liability company or partnership organized or existing under the laws of the United States, any individual state or the District of Columbia; provided ,
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however , that if such Person is a limited liability company or partnership, a corporate Wholly-Owned Restricted Subsidiary of such Person becomes a co-issuer of the Notes in connection therewith;
(ii) the entity or Person formed by or surviving any consolidation or merger (if other than the Company) or the entity or Person to which the sale, assignment, transfer, lease, conveyance or other disposition shall have been made assumes all the then existing obligations of the Company under the Registration Rights Agreement (as defined), the Notes and this Indenture pursuant to a supplemental indenture in a form reasonably satisfactory to the Trustee;
(iii) immediately after the transaction no Default or Event of Default exists; and
(iv) except in the case of a merger or consolidation of the Company with or into a Wholly Owned Subsidiary of the Company, the Company or the Person formed by or surviving the consolidation or merger (if other than the Company), or to which the sale, assignment, transfer, lease, conveyance or other disposition shall have been made will, at the time of the transaction and after giving pro forma effect to it as if the transaction had occurred at the beginning of the applicable four-quarter period, (a) be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of Section 4.09 or (b) have a Fixed Charge Coverage Ratio that is better than the Fixed Charge Coverage Ratio of the Company without giving effect to the transaction.
The Company will not, directly or indirectly, lease all or substantially all of its properties or assets to any Person. This Section 5.01 will not apply to (i) the Merger in connection with the Transactions or (ii) any sale, assignment, transfer, conveyance or other disposition of assets (including by way of merger or consolidation) between or among the Company and any of its Wholly-Owned Restricted Subsidiaries that are Subsidiary Guarantors.
Upon any consolidation or merger, or any sale, assignment, transfer, conveyance or other disposition by the Company (other than by lease) of all or substantially all of the properties and assets of the Company, in accordance with this Section 5.01, the successor Person formed by such consolidation or into which the Company is merged or to which such transfer is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture and the Notes. In the event of any such transfer (other than a transfer of less than all of the properties and assets of the Company), the predecessor Company shall be released and discharged from all liabilities and obligations in respect of the Notes and this Indenture, and the predecessor Company may be dissolved, wound up or liquidated at any time thereafter.
SECTION 5.02 . SUCCESSOR CORPORATION SUBSTITUTED .
The Surviving Person shall succeed to, and be substituted for, and may exercise every right and power of the Company or a Subsidiary Guarantor, as applicable, under this Indenture; provided , however , that the predecessor entity shall not be released from any of the obligations or covenants under this Indenture, including with respect to the payment of the Notes and obligations under the Subsidiary Guarantee, as the case may be, in the case of:
(a) a sale, transfer, assignment, conveyance or other disposition (unless such sale, transfer, assignment, conveyance or other disposition is of all or substantially all of the assets of the Company, taken as a whole or, in the case of a Subsidiary Guarantor, such sale, transfer, assignment, conveyance or other disposition is of all or substantially all of the assets of such Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transaction) a Subsidiary of the Company, or such portion of the Capital Stock of such Subsidiary Guarantor ceases to be a Subsidiary of the Company), or
(b) a lease.
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DEFAULTS AND REMEDIES
SECTION 6.01 . EVENTS OF DEFAULT .
Each of the following constitutes an Event of Default with respect to the Notes:
(i) default for 30 days in the payment when due of interest on, or Liquidated Damages with respect to, the Notes (whether or not permitted by Article 12 hereof);
(ii) default in payment when due of the principal of or premium, if any, on the Notes (whether or not permitted by Article 12 hereof);
(iii) failure by the Company or any of its Restricted Subsidiaries to comply with Section 4.18;
(iv) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice by the Trustee or by the Holders of at least 25% in principal amount of Notes then outstanding to comply with any of its other agreements in this Indenture or the Notes;
(v) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is Guaranteed by the Company or any of its Restricted Subsidiaries) whether the Indebtedness or Guarantee now exists, or is created after the date of this Indenture, which default:
(A) is caused by a failure to pay principal on such Indebtedness at final stated maturity prior to the expiration of the grace period provided in the Indebtedness on the date of the default (a Payment Default ) or
(B) results in the acceleration of the Indebtedness prior to its stated maturity
and, in each case, the principal amount of any Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated (after giving effect to any applicable grace period), aggregates $10.0 million or more;
(vi) failure by the Company or any of its Restricted Subsidiaries to pay final judgments aggregating in excess of $10.0 million (net of any amount with respect to which a reputable insurance company with assets over $100.0 million has acknowledged liability in writing), which judgments are not paid, discharged or stayed for a period of 60 days after their entry;
(vii) the Company or any of its Significant Subsidiaries pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or gives notice of intention to make a proposal under any Bankruptcy Law;
(B) consents to the entry of an order for relief against it in an involuntary case or consents to its dissolution or winding up;
(C) consents to the appointment of a receiver, interim receiver, receiver and manager, liquidator, trustee or custodian of it or for all or substantially all of its property;
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(D) makes a general assignment for the benefit of its creditors; or
(E) admits in writing its inability to pay its debts as they become due or otherwise admits its insolvency;
(viii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any of its Significant Subsidiaries in an involuntary case; or
(B) appoints a receiver, interim receiver, receiver and manager, liquidator, trustee or custodian of the Company or any of its Significant Subsidiaries or for all or substantially all of the property of the Company or any of its Significant Subsidiaries; or
(C) orders the liquidation of the Company or any of its Significant Subsidiaries;
and such order or decree remains unstayed and in effect for 60 consecutive days; and
(ix) except as permitted by this Indenture, any Subsidiary Guarantee of any Significant Subsidiary (or group of Subsidiary Guarantors that, collectively, would be a Significant Subsidiary) shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect or any Subsidiary Guarantor that is a Significant Subsidiary (or group of Subsidiary Guarantors that, collectively, would be a Significant Subsidiary), or any Person acting on behalf of any Subsidiary Guarantor (or group of Subsidiary Guarantors) that is a Significant Subsidiary, shall deny or disaffirm its obligations under its Subsidiary Guarantee.
SECTION 6.02 . ACCELERATION .
If any Event of Default (other than those of the type described in Section 6.01(vii) or (viii) occurs and is continuing, the Trustee may, and the Trustee upon the request of Holders of 25% in principal amount of the outstanding Notes shall, or the Holders of at least 25% in principal amount of outstanding Notes may, declare the principal of all the Notes, together with all accrued and unpaid interest, premium, if any, to be due and payable by notice in writing to the Company and the Trustee specifying the respective Event of Default and that such notice is a notice of acceleration (the Acceleration Notice ), and the same shall become immediately due and payable.
In the case of an Event of Default specified in Section (vii) or (viii) of Section 6.01 hereof, all outstanding Notes shall become due and payable immediately without any further declaration or other act on the part of the Trustee or the Holders. Holders may not enforce this Indenture or the Notes except as provided in this Indenture.
Upon a declaration of acceleration, such principal and interest will become due and payable upon the earlier to occur of (x) the 5th day after notice thereof has been given to holders of Designated Senior Debt and (y) the date on which all of the Designated Senior Debt has been accelerated. In the event of a declaration of acceleration of the Notes because an Event of Default has occurred and is continuing as a result of the acceleration of any Indebtedness described in Section 6.01(v) (excluding any resulting payment default under this Indenture or the Notes), the declaration of acceleration of the Notes shall be automatically annulled if the holders of all Indebtedness described in Section 6.01(v) have rescinded the declaration of acceleration in respect of such Indebtedness within 20 days of the date of such declaration, and if the annulment of the acceleration of the Notes would not conflict with any judgment or decree of a court of competent jurisdiction, and all existing Events of Default, except non-payment of principal or interest on the Notes that became due solely because of the acceleration of the Notes, have been cured or waived.
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The Holders of a majority in principal amount of the outstanding Notes by written notice to the Company and to the Trustee may waive all past Defaults and rescind and annul a declaration of acceleration and its consequences if:
(1) all existing Events of Default, other than the nonpayment of the principal of, premium, or Liquidated Damages if any, and interest on, the Notes that have become due solely by the declaration of acceleration, have been cured or waived, and
(2) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction.
SECTION 6.03. OTHER REMEDIES .
If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies shall be cumulative to the extent permitted by law.
SECTION 6.04 . WAIVER OF DEFAULTS .
(a) The Holders of at least a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes, waive any existing Default or Event of Default, and its consequences, except a continuing Default or Event of Default (i) in the payment of the principal of, premium, if any, or interest, on the Notes and (ii) in respect of a covenant or provision which under this Indenture cannot be modified or amended without the consent of the Holder of each Note affected by such modification or amendment. Upon any waiver of a Default or Event of Default, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed cured for every purpose of this Indenture but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.
SECTION 6.05 . CONTROL BY MAJORITY .
Subject to Section 7.01, Section 7.02(f) (including the Trustees receipt of the security or indemnification described therein) and Section 7.07 hereof, in case an Event of Default shall occur and be continuing, the Holders of a majority in aggregate principal amount of the Notes then outstanding shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Notes.
SECTION 6.06 . LIMITATION ON SUITS .
A Holder may not institute any proceeding, judicial or otherwise, with respect to this Indenture or the Notes, or for the appointment of a receiver or trustee, or for any other remedy under this Indenture or the Notes, unless:
(1) the Holder has previously given to the Trustee written notice of a continuing Event of Default;
(2) Holders of at least 25% in aggregate principal amount of outstanding Notes have made written request to the Trustee to institute proceedings in respect of the Event of Default in its own name as Trustee under this Indenture;
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(3) Holders have offered to the Trustee indemnity reasonably satisfactory to the Trustee against any costs, liabilities or expenses to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and
(5) during such 60-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes have not given the Trustee a direction that is inconsistent with such written request.
The preceding limitations shall not apply to a suit instituted by a Holder for enforcement of payment of principal of, and premium, if any, or interest on, a Note on or after the respective due dates for such payments set forth in such Note.
A Holder may not use this Indenture to affect, disturb or prejudice the rights of another Holder or to obtain a preference or priority over another Holder.
SECTION 6.07 . RIGHTS OF HOLDERS TO RECEIVE PAYMENT .
Notwithstanding any other provision of this Indenture (including Section 6.06), the right of any Holder to receive payment of principal, premium, if any, and interest on the Notes held by such Holder, on or after the respective due dates expressed in the Notes (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.08 . COLLECTION SUIT BY TRUSTEE .
If an Event of Default specified in Section 6.01 (i) or (ii) occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium, if any, and interest then due and owing (together with interest on overdue principal and, to the extent lawful, interest) and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09 . TRUSTEE MAY FILE PROOFS OF CLAIM .
The Trustee shall be authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee and its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, moneys, securities and any other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
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SECTION 6.10 . PRIORITIES .
If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, and interest, respectively; and
Third: to the Company or to such party as a court of competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11 . UNDERTAKING FOR COSTS .
In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in principal amount of the then outstanding Notes.
TRUSTEE
SECTION 7.01 . DUTIES OF TRUSTEE .
(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a prudent Person would exercise or use under the circumstances in the conduct of such Persons own affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, in the case of certificates or opinions specifically required by any provision hereof to be furnished to it, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
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(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of this Section 7.01;
(2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
SECTION 7.02 . RIGHTS OF TRUSTEE .
Subject to TIA Section 315:
(a) The Trustee may conclusively rely upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in any such document.
(b) Before the Trustee acts or refrains from acting, it may require an Officers Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers Certificate or Opinion of Counsel. The Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture, provided that the Trustees conduct does not constitute willful misconduct or negligence.
(e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to it against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction.
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(g) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its reasonable discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall reasonably determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company during normal business hours and upon reasonable notice, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
(h) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys, and the Trustee shall not be responsible for any willful misconduct or gross negligence on the part of any agent or attorney appointed with due care by it under this Indenture.
(i) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a Default or Event of Default is received by a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee from the Company or the Holders of 25% in aggregate principal amount of the outstanding Notes, and such notice references the specific Default or Event of Default, the Notes and this Indenture.
(j) The Trustee shall not be required to give any bond or surety in respect of the performance of its power and duties hereunder.
(k) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.
SECTION 7.03 . INDIVIDUAL RIGHTS OF TRUSTEE .
The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue as Trustee or resign. Any Agent may do the same with like rights and duties. The Trustee shall also be subject to Sections 7.10 and 7.11 hereof.
SECTION 7.04 . TRUSTEES DISCLAIMER .
The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Companys use of the proceeds from the Notes or any money paid to the Company or upon the Companys direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.
SECTION 7.05 . NOTICE OF DEFAULTS .
If a Default or Event of Default occurs and is continuing and if it is actually known to the Trustee, the Trustee shall mail to the Holders a notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders.
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SECTION 7.06 . REPORTS BY TRUSTEE TO HOLDERS .
Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders a brief report dated as of such reporting date that complies with TIA §313(a) (but if no event described in TIA §313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA §313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA §313(c).
A copy of each report at the time of its mailing to the Holders shall be mailed to the Company and filed with the Commission and each stock exchange on which the Notes are listed in accordance with TIA §313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange and any delisting thereof.
SECTION 7.07 . COMPENSATION AND INDEMNITY .
The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder as the Company and the Trustee shall from time to time agree in writing. The Trustees compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustees agents and counsel.
The Company shall indemnify the Trustee (in its capacity as Trustee) or any predecessor Trustee (in its capacity as Trustee) against any and all losses, claims, damages, penalties, fines, liabilities or expenses, including incidental and out-of-pocket expenses and reasonable attorneys fees (for purposes of this Article 7, losses ) incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by the Company or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent such losses are determined to have been caused by its own gross negligence, willful misconduct or bad faith. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations under this Indenture. The Company shall defend the claim, and the Trustee shall cooperate in the defense. The Trustee may have separate counsel if the Trustee has been reasonably advised by counsel that there may be one or more legal defenses available to it that are different from or additional to those available to the Company and in the reasonable judgment of such counsel it is advisable for the Trustee to engage separate counsel. The Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss incurred by the Trustee that has been determined to have been caused by the Trustees own gross negligence, willful misconduct or bad faith.
The obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture, the resignation or removal of the Trustee and payment in full of the Notes through the expiration of the applicable statute of limitations.
To secure the Companys payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal, premium, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(vii) or (viii) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA §313(b)(2) to the extent applicable.
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SECTION 7.08 . REPLACEMENT OF TRUSTEE .
A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustees acceptance of appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time upon 30 days prior notice to the Company and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in aggregate principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged bankrupt or insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10% in aggregate principal amount of the then outstanding Notes may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. Subject to the Lien provided for in Section 7.07 hereof, the retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee; provided , however , that all sums owing to the Trustee hereunder shall have been paid. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Companys obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee.
In the case of an appointment hereunder of a separate or successor Trustee with respect to the Notes, the Company, the Subsidiary Guarantors, any retiring Trustee and each successor or separate Trustee with respect to the Notes shall execute and deliver an Indenture supplemental hereto (1) which shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of any retiring Trustee with respect to the Notes as to which any such retiring Trustee is not retiring shall continue to be vested in such retiring Trustee and (2) that shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustee co-trustees of the same trust and that each such separate, retiring or successor Trustee shall be Trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any such other Trustee.
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SECTION 7.09 . SUCCESSOR TRUSTEE BY MERGER, ETC .
If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation or banking association, the successor corporation or banking association without any further act shall, if such successor corporation or banking association is otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10 . ELIGIBILITY; DISQUALIFICATION .
There shall at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $50.0 million (or a wholly-owned subsidiary of a bank or trust company, or of a bank holding company, the principal subsidiary of which is a bank or trust company having a combined capital and surplus of at least $50.0 million) as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the requirements of TIA §310(a)(1), (2) and (5). The Trustee is subject to TIA §310(b).
SECTION 7.11 . PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY .
The Trustee is subject to TIA §311(a), excluding any creditor relationship listed in TIA §311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01 . OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE .
The Company may, at its option and at any time, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth in this Article 8.
SECTION 8.02 . LEGAL DEFEASANCE AND DISCHARGE .
Upon the Companys exercise under Section 8.01 of the option applicable to this Section 8.02, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, Legal Defeasance ) and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee. For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Debt represented by the outstanding Notes, which shall thereafter be deemed to be outstanding only for the purposes of Section 8.05 and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.04, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, or interest on such Notes when such payments are due, (b) the Companys obligations with respect to such Notes under Article 2 and Sections 4.01 and 4.02, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Companys obligations in connection therewith and (d) this Article 8. If the Company exercises under Section 8.01 the option applicable to this Section 8.02, subject to the satisfaction of the conditions set forth in Section 8.04, payment of the Notes may not be accelerated because of an Event of Default. Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03.
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SECTION 8.03 . COVENANT DEFEASANCE .
Upon the Companys exercise under Section 8.01 of the option applicable to this Section 8.03, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04, be released from its obligations under the covenants contained in Sections 4.08 through 4.20 hereof, and the operation of Section 5.01, with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 are satisfied (hereinafter, Covenant Defeasance ) and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee with respect to such covenants in connection with such outstanding Notes and the Notes shall thereafter be deemed not outstanding for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed outstanding for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. If the Company exercises under Section 8.01 the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04, payment of the Notes may not be accelerated because of an Event of Default specified in clauses (iii), (iv) (with respect to the covenants contained in Sections 4.08 through 4.17, 4.19 and 4.20 hereof), (v), (vi), (vii) and (viii) of Section 6.01 (but in the case of (vii) and (viii) of Section 6.01, with respect to Significant Subsidiaries only) or because of the Companys failure to comply with Section 5.01.
SECTION 8.04 . CONDITIONS TO LEGAL OR COVENANT DEFEASANCE .
The following shall be the conditions to the application of either Section 8.02 or 8.03 to the outstanding Notes.
The Legal Defeasance or Covenant Defeasance may be exercised only if:
(a) the Company irrevocably deposits with the Trustee, in trust (the defeasance trust ), for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination of cash in U.S. dollars and non-callable U.S. Government Securities, in an amount sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal, premium, if any, and interest on the outstanding Notes on the Stated Maturity or on the next redemption date, as the case may be, and the Company shall specify whether the Notes are being defeased to maturity or to such particular redemption date;
(b) in the case of Legal Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that (i) the Company has received from the Internal Revenue Service a ruling directed to it or (ii) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of Covenant Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
(d) no Event of Default under Section 6.01(vii) or (viii) shall have occurred at any time in the period ending on the 91 st day after the cash and/or non-callable U.S. Government Securities have been deposited in the defeasance trust;
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(e) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than this Indenture) to which the Company or any Restricted Subsidiary is a party or by which the Company or any Restricted Subsidiary is bound;
(f) the Company shall deliver to the Trustee an Opinion of Counsel, subject to customary exceptions, to the effect that on the 123rd day following the deposit, the defeasance trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws generally affecting creditors rights;
(g) the Company shall deliver to the Trustee an Officers Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders over other creditors of the Company with the intent of defeating, hindering, delaying or defrauding such other creditors; and
(h) the Company delivers to the Trustee an Officers Certificate and an Opinion of Counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
SECTION 8.05 . DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS .
Subject to Section 8.06, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the Trustee ) pursuant to Section 8.04 in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable U.S. Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any cash or non-callable U.S. Government Securities held by it as provided in Section 8.04 which, in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to the Trustee (which may be the certification delivered under Section 8.04(a)), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.06 . REPAYMENT TO COMPANY .
The Trustee shall promptly, and in any event, no later than five (5) Business Days, pay to the Company after request therefor, any excess money held with respect to the Notes at such time in excess of amounts required to pay any of the Companys Obligations then owing with respect to the Notes.
Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal, premium, if any, or interest on any Note and remaining unclaimed for one year after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national edition), notice that such cash and securities remains
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unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company.
SECTION 8.07 . REINSTATEMENT .
If the Trustee or Paying Agent is unable to apply any cash or non-callable U.S. Government Securities in accordance with Section 8.02 or 8.03, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Companys obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 until such time as the Trustee or Paying Agent is permitted to apply all such cash and securities in accordance with Section 8.02 or 8.03, as the case may be; provided, however , that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders to receive such payment from the cash and securities held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 . WITHOUT CONSENT OF HOLDERS OF NOTES .
Notwithstanding Section 9.02 of this Indenture, the Company and the Trustee may amend or supplement this Indenture or the Notes without the consent of any Holder to:
(1) to cure any ambiguity, defect or inconsistency,
(2) to provide for uncertificated notes in addition to or in place of certificated notes,
(3) to provide for the assumption of the Companys or a Subsidiary Guarantors obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Companys assets,
(4) to provide for the issuance of Additional Notes in accordance with the provisions set forth in this Indenture on the date of this Indenture,
(5) to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under this Indenture of any Holder,
(6) to comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act,
(7) to allow any Subsidiary Guarantor to guarantee the Notes, or
(8) to conform any provision of this Indenture to the Description of Notes contained in the Offering Memorandum.
SECTION 9.02 . WITH CONSENT OF HOLDERS OF NOTES .
Except as provided below in this Section 9.02, the Company and the Trustee may amend or supplement this Indenture and the Notes with the consent of the Holders of at least a majority in aggregate principal amount of the Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07, any existing Default or Event of Default (except a continuing Default or Event of Default in (i) the payment of principal, premium, if any, or interest on the Notes and (ii) in respect of a covenant or provision
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which under this Indenture cannot be modified or amended without the consent of the Holder of each Note affected by such modification or amendment) or compliance with any provision of this Indenture or the Notes may be waived with the consent of the Holders of at least a majority in aggregate principal amount of the Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes).
Without the consent of each Holder, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder):
(i) reduce the principal amount of Notes whose holders must consent to an amendment, supplement or waiver,
(ii) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption or repurchase of the Notes (other than provisions relating to Sections 4.12 and 4.18),
(iii) reduce the rate of or change the time for payment of interest on any Note,
(iv) waive a Default or Event of Default in the payment of principal of or premium or Liquidated Damages, if any, or interest on the Notes (except a rescission of acceleration of the Notes by the holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from the acceleration),
(v) make any Note payable in money other than that stated in the Notes,
(vi) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of holders of Notes to receive payments of principal of or premium, if any, or interest on the Notes,
(vii) waive a redemption or repurchase payment with respect to any Note (other than a payment required by Section 4.12 or 4.18),
(viii) release any Subsidiary Guarantor from any of its obligations under its Subsidiary Guarantee or this Indenture, except in accordance with the terms of this Indenture, or
(ix) make any change in the foregoing amendment and waiver provisions.
The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any supplemental indenture. If a record date is fixed, the Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; provided that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 120 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect.
It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company shall mail to the Holder of each Note affected thereby to such Holders address appearing in the Security Register a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver.
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SECTION 9.03 . COMPLIANCE WITH TRUST INDENTURE ACT .
Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect.
SECTION 9.04 . REVOCATION AND EFFECT OF CONSENTS .
Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion thereof that evidences the same debt as the consenting Holders Note, even if notation of the consent is not made on any Note. However, any such Holder or subsequent Holder may revoke the consent as to its Note or portion thereof if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or waiver shall become effective in accordance with its terms and thereafter shall bind every Holder.
SECTION 9.05 . NOTATION ON OR EXCHANGE OF NOTES .
The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate new Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06 . TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. None of the Company nor any Subsidiary Guarantor may sign an amendment or supplemental indenture until its board of directors (or committee serving a similar function) approves it. In executing any amended or supplemental indenture, the Trustee shall be provided with and (subject to Section 7.01 hereof) shall be fully protected in relying upon an Officers Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture and that such amended or supplemental indenture is the legal, valid and binding obligations of the Company enforceable against it in accordance with its terms, subject to customary exceptions and that such amended or supplemental indenture complies with the provisions hereof (including Section 9.03).
ARTICLE 10.
GUARANTEES
SECTION 10.01 . SUBSIDIARY GUARANTEE .
Subject to this Article 10, the Subsidiary Guarantors hereby unconditionally guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns: (a) the due and punctual payment of the principal of, premium, if any, and interest on the Notes, subject to any applicable grace period, whether at Stated Maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on the overdue principal of and premium, if any, and, to the extent permitted by law, interest, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee under this Indenture, the Registration Rights Agreement or any other agreement with or for the benefit of the Holders or the Trustee, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at Stated Maturity, by acceleration pursuant to Section 6.02, redemption or otherwise. Failing payment when due of any amount so guaranteed or any
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performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately. Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
Each Subsidiary Guarantor hereby agrees that its obligations with regard to its Subsidiary Guarantee shall be joint and several, unconditional, irrespective of the validity or enforceability of the Notes or the obligations of the Company under this Indenture, the absence of any action to enforce the same, the recovery of any judgment against the Company or any other obligor with respect to this Indenture, the Notes or the Obligations of the Company under this Indenture or the Notes, any action to enforce the same or any other circumstances (other than complete performance) which might otherwise constitute a legal or equitable discharge or defense of a Subsidiary Guarantor. Each Subsidiary Guarantor further, to the extent permitted by law, waives and relinquishes all claims, rights and remedies accorded by applicable law to guarantors and agrees not to assert or take advantage of any such claims, rights or remedies, including but not limited to: (a) any right to require any of the Trustee, the Holders or the Company (each a Benefited Party ), as a condition of payment or performance by such Subsidiary Guarantor, to (1) proceed against the Company, any other guarantor (including any other Subsidiary Guarantor) of the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed against or exhaust any security held from the Company, any such other guarantor or any other Person, (3) proceed against or have resort to any balance of any deposit account or credit on the books of any Benefited Party in favor of the Company or any other Person, or (4) pursue any other remedy in the power of any Benefited Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Company including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations under the Subsidiary Guarantees or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Company from any cause other than payment in full of the Obligations under the Subsidiary Guarantees; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Benefited Partys errors or omissions in the administration of the Obligations under the Subsidiary Guarantees, except behavior which amounts to bad faith; (e)(1) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of the Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary Guarantors obligations hereunder, (2) the benefit of any statute of limitations affecting such Subsidiary Guarantors liability hereunder or the enforcement hereof, (3) any rights to set-offs, recoupments and counterclaims and (4) promptness, diligence and any requirement that any Benefited Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentations, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance of the Subsidiary Guarantees, notices of Default under the Notes or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations under the Subsidiary Guarantees or any agreement related thereto, and notices of any extension of credit to the Company and any right to consent to any thereof; (g) to the extent permitted under applicable law, the benefits of any One Action rule and (h) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of the Subsidiary Guarantees. Except to the extent expressly provided herein, including Sections 8.02, 8.03 and 10.05, each Subsidiary Guarantor hereby covenants that its Subsidiary Guarantee shall not be discharged except by complete performance of the obligations contained in its Subsidiary Guarantee and this Indenture.
If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Subsidiary Guarantors, any amount paid by either to the Trustee or such Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.
Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 hereof for the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby and (y) in the event of any declaration of acceleration of such obligations as provided in Section 6.02 hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to seek contribution
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from any non-paying Subsidiary Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Subsidiary Guarantee.
SECTION 10.02 . LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY .
(a) Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that each Subsidiary Guarantors liability shall be that amount from time to time equal to the aggregate liability of such Subsidiary Guarantor under the guarantee, but shall be limited to the lesser of (a) the aggregate amount of the Companys obligations under the Notes and this Indenture or (b) the amount, if any, which would not have (1) rendered the Subsidiary Guarantor insolvent (as such term is defined in the Federal Bankruptcy Code and in the Debtor and Creditor Law of the State of New York) or (2) left it with unreasonably small capital at the time its guarantee with respect to the Notes was entered into, after giving effect to the incurrence of existing Debt immediately before such time; provided , however , it shall be a presumption in any lawsuit or proceeding in which a Subsidiary Guarantor is a party that the amount guaranteed pursuant to the guarantee with respect to the Notes is the amount described in clause (a) above unless any creditor, or representative of creditors of the Subsidiary Guarantor, or debtor in possession or Trustee in bankruptcy of the Subsidiary Guarantor, otherwise proves in a lawsuit that the aggregate liability of the Subsidiary Guarantor is limited to the amount described in clause (b).
(b) In making any determination as to the solvency or sufficiency of capital of a Subsidiary Guarantor in accordance with the proviso of Section 10.2(a), the right of each Subsidiary Guarantor to contribution from other Subsidiary Guarantors and any other rights such Subsidiary Guarantor may have, contractual or otherwise, shall be taken into account.
SECTION 10.03 . EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE .
To evidence its Subsidiary Guarantee set forth in Section 10.01, each Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee in substantially the form included in Exhibit E attached hereto shall be endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture shall be executed on behalf of such Subsidiary Guarantor by its President or one of its Vice Presidents.
Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee set forth in Section 10.01 shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the Subsidiary Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set forth in this Indenture on behalf of the Subsidiary Guarantors.
The Company hereby agrees that it shall cause each Person that becomes obligated to provide a Subsidiary Guarantee pursuant to Section 4.19 to execute a supplemental indenture in form and substance reasonably satisfactory to the Trustee, pursuant to which such Person provides the guarantee set forth in this Article 10 and otherwise assumes the obligations and accepts the rights of a Subsidiary Guarantor under this Indenture, in each case with the same effect and to the same extent as if such Person had been named herein as a Subsidiary Guarantor. The Company also hereby agrees to cause each such new Subsidiary Guarantor to evidence its guarantee by endorsing a notation of such guarantee on each Note as provided in this Section 10.03.
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SECTION 10.04 . SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS .
Except as otherwise provided in Section 10.05, no Subsidiary Guarantor may consolidate with or merge with or into (whether or not such Subsidiary Guarantor is the Surviving Person) another Person whether or not affiliated with such Subsidiary Guarantor unless:
(a) subject to Section 10.05, the Person formed by or surviving any such consolidation or merger (if other than a Subsidiary Guarantor or the Company) unconditionally assumes all the obligations of such Subsidiary Guarantor, pursuant to a supplemental indenture in form and substance reasonably satisfactory to the Trustee, under this Indenture, the Subsidiary Guarantee and any Registration Rights Agreements on the terms set forth herein or therein; and
(b) the Subsidiary Guarantor complies with the requirements of Article 5 hereof.
In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Subsidiary Guarantor, such successor Person shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein as a Subsidiary Guarantor. Such successor Person thereupon may cause to be signed any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Subsidiary Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Subsidiary Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5, and notwithstanding clauses (a) and (b) above, nothing contained in this Indenture or in any of the Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an entirety to the Company or another Subsidiary Guarantor.
SECTION 10.05 . RELEASES FOLLOWING MERGER, CONSOLIDATION OR SALE OF ASSETS, ETC.
In the event of a sale or other disposition of all or substantially all of the assets of any Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the Capital Stock of any Subsidiary Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) a Subsidiary of the Company, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the Capital Stock of such Subsidiary Guarantor) or the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor) shall be released and relieved of any obligations under its Subsidiary Guarantee; provided that the net proceeds of such sale or other disposition shall be applied in accordance with the applicable provisions of this Indenture, including without limitation Section 4.12. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary in accordance with the provisions of Section 4.17, such Subsidiary shall be released and relieved of any obligations under its Subsidiary Guarantee. Upon delivery by the Company to the Trustee of an Officers Certificate and an Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.12, the Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Subsidiary Guarantee.
Any Subsidiary Guarantor not released from its obligations under its Subsidiary Guarantee shall remain liable for the full amount of principal of and interest on the Notes and for the other obligations of any Subsidiary Guarantor under this Indenture as provided in this Article 10.
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SECTION 10.06 . SUBORDINATION OF SUBSIDIARY GUARANTEE .
The Obligations of each Subsidiary Guarantor under its Subsidiary Guarantee pursuant to this Article 10 will be junior and subordinated to the Senior Debt of such Subsidiary Guarantor on the same basis as the Notes are junior and subordinated to Senior Debt of the Company. For the purposes of the foregoing sentence, the Trustee and the Holders will have the right to receive and/or retain payments by any of the Subsidiary Guarantors only at such times as they may receive and/or retain payments in respect of the Notes pursuant to this Indenture, including Article 12 hereof.
ARTICLE 11.
SATISFACTION AND DISCHARGE
SECTION 11.01 . SATISFACTION AND DISCHARGE .
This Indenture shall be discharged and shall cease to be of further effect, except as to surviving rights of registration of transfer or exchange of the Notes, as to all Notes issued hereunder, when:
(a) either:
(i) all Notes that have been previously authenticated and delivered (except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has previously been deposited in trust or segregated and held in trust by the Company and is thereafter repaid to the Company or discharged from the trust) have been delivered to the Trustee for cancellation; or
(ii) (i) all Notes that have not been previously delivered to the Trustee for cancellation, have become due and payable by their terms or have been called for redemption, and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination thereof, in such amounts as shall be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire Debt on the Notes not previously delivered to the Trustee for cancellation or redemption for principal, premium, if any, and interest on the Notes to the date of deposit, in the case of Notes that have become due and payable, or to the Stated Maturity or redemption date, as the case may be; (ii) the Company has paid all other sums payable by the Company with respect to the Notes under this Indenture; and (iii) the Company has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes at Stated Maturity or on the redemption date, as the case may be.
in the case of either clause (i) or (ii):
(x) no Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company is a party or by which the Company is bound; and
(y) the Company shall have delivered to the Trustee an Officers Certificate and Opinion of Counsel stating that all conditions precedent relating to the satisfaction and discharge of this Indenture have been satisfied.
SECTION 11.02 . DEPOSITED CASH AND U.S. GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS .
Subject to Section 11.03, all cash and non-callable U.S. Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 11.02, the Trustee ) pursuant to Section 11.01 hereof in respect of the outstanding Notes shall be held in trust and
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applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law.
SECTION 11.03 . REPAYMENT TO COMPANY .
Any cash or non-callable U.S. Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on, any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national edition), notice that such cash and securities remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company.
ARTICLE 12.
SUBORDINATION
SECTION 12.01 . AGREEMENT TO SUBORDINATE
The Company agrees, and each Holder by accepting a Note agrees, that the payment of principal of, premium and Liquidated Damages, if any, and interest on, and all other amounts payable in respect of, the Notes is subordinated in right of payment, to the extent and in the manner provided in this Article 12 and subject to the provisions of Article 8 hereof, to the prior payment in full of all Senior Debt and that the subordination is for the benefit of and enforceable by the holders of such Senior Debt. The Notes shall in all respects rank pari passu with any future senior subordinated Indebtedness and senior to all existing and future subordinated Indebtedness of the Company, and only Senior Debt shall rank senior to the Notes in accordance with the provisions set forth herein. All provisions of this Article 12 shall be subject to Section 12.12. All references to Senior Debt in this Article 12 are to Senior Debt of the Company.
SECTION 12.02 . LIQUIDATION, DISSOLUTION, BANKRUPTCY
(a) Upon any distribution to creditors of the Company in a liquidation or dissolution of the Company or in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or its property, an assignment for the benefit of creditors or any marshalling of the Companys assets and liabilities, the holders of Senior Debt will be entitled to receive payment in full in cash of all Obligations due in respect of the Senior Debt (including interest after the commencement of any of these proceedings at the rate specified in the applicable Senior Debt whether or not allowed in the relevant proceeding) before the Holders of Notes will be entitled to receive any payment with respect to the Notes, and until all Obligations with respect to the Senior Debt are paid in full in cash, any distribution to which the Holders of Notes would be entitled shall be made to the holders of Senior Debt (except that Holders of Notes may receive and retain Permitted Junior Securities and payments made from the trust described under Article 8).
(b) Until the Senior Debt is paid in full in cash, any distribution to which Holders of the Notes would be entitled but for this Article 12 will be made to holders of the Senior Debt as their interests may appear (except that Holders of Notes may receive and retain payments made in Permitted Junior Securities and payments and other distributions made from the trust described in Article 8 hereof; provided that (i) no Holder of the Notes shall have the right to receive and retain any such Permitted Junior Securities if the existence of such right would have the effect of causing the Notes to be treated in the same class of claims as the Senior Debt of the Company or
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any class of claims which is pari passu with such Senior Debt and (ii) holders of Senior Debt shall be entitled to receive any cash payments made to any Holder of Notes on the account of Permitted Junior Securities until all Obligations in respect of Senior Debt have been paid in full in cash).
SECTION 12.03 . DEFAULT ON SENIOR DEBT
The Company may not make any payment upon or in respect of the Notes (except in Permitted Junior Securities or from the trust described under Article 8) ( pay the Notes ) if (i) a default in the payment of the principal of, premium, if any, or interest on Designated Senior Debt occurs and is continuing beyond any applicable period of grace; or (ii) any other default occurs and is continuing with respect to Designated Senior Debt that permits holders of such Designated Senior Debt to accelerate its maturity and the trustee receives a Payment Blockage Notice from the Company or the Representatives of the holders of such Designated Senior Debt.
During the continuance of any default (other than a default described in clause (i) or (ii) of the preceding paragraph) with respect to any Designated Senior Debt pursuant to which the maturity thereof may be accelerated immediately without further notice (except any notice required to effect the acceleration) or the expiration of any applicable grace period, the Company may not pay the Notes for a period (a Payment Blockage Period ) commencing upon the receipt by the Company and the Trustee of written notice of such default from the Representative of the holders of such Designated Senior Debt or, if there is no Representative, from the holders of such Designated Senior Debt, specifying an election to effect a Payment Blockage Period (a Payment Blockage Notice ) and ending 179 days thereafter (unless such Payment Blockage Period is earlier terminated (a) by written notice to the Trustee and the Company from the Representative of the holders of such Designated Senior Debt or, if there is no Representative, from the holders of such Designated Senior Debt that gave such Payment Blockage Notice, (b) because such default is no longer continuing or (c) because such Designated Senior Debt has been repaid in full in cash). No new Payment Blockage Period may be commenced unless and until (i) 360 days have elapsed since the effectiveness of the immediately prior Payment Blockage Notice and (ii) all scheduled payments of principal, premium, if any, interest and Liquidated Damages, if any, on the Notes that have come due during the Payment Blockage Period have been paid in full in cash. No non-payment default that existed or was continuing on the date of delivery of any Payment Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice unless the default shall have been waived for a period of not less than 90 days. Following the expiration of any period during which the Company is prohibited from making payments on the Notes pursuant to a Payment Blockage Notice, the Company shall (unless otherwise prohibited as described in the first two sentences of this paragraph) resume making any and all required payments in respect of the Notes, including, without limitation, any missed payments, unless the maturity of any Designated Senior Debt has been accelerated, and such acceleration remains in full force and effect.
The Company shall give prompt written notice to the Trustee of any default in the payment of any Senior Debt or any acceleration under any Senior Debt or under any agreement pursuant to which Senior Debt may have been issued. Failure to give such notice shall not effect the subordination of the Notes to the Senior Debt or the application of the other provisions provided in this Article 12.
SECTION 12.04 . ACCELERATION OF PAYMENT OF NOTES .
If payment of the Notes is accelerated when Designated Senior Debt is outstanding, the Company may not pay the Notes until five days after the Representative of the holders of such Designated Senior Debt or, if there is no Representative, the holders of such Designated Senior Debt receive notice of such acceleration and, thereafter, may pay the Notes only if this Indenture otherwise permits payment at that time.
SECTION 12.05 . WHEN DISTRIBUTION MUST BE PAID OVER .
If a payment or distribution is made to Holders that because of this Article 12 should not have been made to them, the Trustee or the Holders who receive the distribution shall hold it in trust for holders of Senior Debt ( pro rata as to each of such holders of Senior Debt on the basis of the respective amounts of Senior Debt paid to them) and pay it over to them or their Representative as their interests may appear.
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SECTION 12.06 . SUBROGATION
After all Senior Debt is paid in full and until the Notes are paid in full, Holders shall be subrogated (equally and ratably with all other Debt that is pari passu with the Notes) to the rights of holders of Senior Debt to receive distributions applicable to Senior Debt to the extent that distributions otherwise payable to the Holders have been applied to the payment of Senior Debt. A distribution made under this Article 12 to holders of Senior Debt that otherwise would have been made to Holders is not, as between the Company and Holders, a payment by the Company on such Senior Debt.
SECTION 12.07 . RELATIVE RIGHTS
This Article 12 defines the relative rights of Holders and holders of Senior Debt. Nothing in this Indenture shall:
(a) impair, as between the Company and Holders, the obligation of the Company, which is absolute and unconditional, to pay principal of, premium, if any, and interest on, the Notes in accordance with their terms;
(b) affect the relative rights of Holders and creditors of the Company other then their rights in relation to holders of Senior Debt; or
(c) prevent the Trustee or any Holder from exercising its available remedies upon a Default or an Event of Default, subject to the rights of holders of Senior Debt to receive distributions otherwise payable to Holders.
SECTION 12.08 . SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY
No right of any holder of Senior Debt to enforce the subordination of the Debt evidenced by the Notes shall be impaired by any act or failure to act by the Company or by its failure to comply with this Indenture.
SECTION 12.09 . RIGHTS OF TRUSTEE AND PAYING AGENT
Notwithstanding Section 12.03, the Trustee or Paying Agent may continue to make payments on the Notes and shall not be charged with knowledge of the existence of facts that would prohibit the making of any such payments unless, not less than two Business Days prior to the date of such payment, a Responsible Officer receives notice satisfactory to it that payments may not be made under this Article 12. The Company, the Registrar or co-registrar, the Paying Agent, a Representative or a holder of Senior Debt may give the notice; provided, however, that, if an issue of Senior Debt has a Representative, only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior Debt with the same rights it would have if it were not Trustee. The Registrar and co-registrar and the Paying Agent may do the same with like rights. The Trustee shall be entitled to all the rights set forth in this Article 12 with respect to any Senior Debt that may at any time be held by it, to the same extent as any other holder of such Senior Debt; and nothing in Article 7 shall deprive the Trustee of any of its rights as such holder. Nothing in this Article 12 shall apply to claims of, or payments to, the Trustee under or pursuant to Section 7.07.
SECTION 12.10 . DISTRIBUTION OR NOTICE TO REPRESENTATIVE
Whenever a distribution is to be made or a notice given to holders of Senior Debt, the distribution may be made and the notice given to their Representative (if any).
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SECTION 12.11 . ARTICLE 12 NOT TO PREVENT EVENTS OF DEFAULT OR LIMIT RIGHT TO ACCELERATE
Nothing in this Article 12 shall prevent an Event of Default in accordance with Article 6 or have any effect on the right of the Holders or the Trustee to accelerate the maturity of the Notes or to exercise the rights and remedies in Article 6.
SECTION 12.12 . TRUST MONEYS NOT SUBORDINATED
Notwithstanding anything contained herein to the contrary, payments from cash or the proceeds of non-callable U.S. Government Securities held in trust under Article 8 by the Trustee for the payment of principal of and interest on the Notes shall not be subordinated to the prior payment of any Senior Debt or subject to the restrictions set forth in this Article 12, and none of the Holders shall be obligated to pay over any such amount to the Company or any holder of Senior Debt or any other creditor of the Company.
SECTION 12.13 . TRUSTEE ENTITLED TO RELY
Upon any payment or distribution pursuant to this Article 12, the Trustee and the Holders shall be entitled to rely (a) upon any order or decree of a court of competent jurisdiction in which any proceedings of the nature referred to in Section 12.02 are pending, (b) upon a certificate of the liquidating trustee or agent or other Person making such payment or distribution to the Trustee or to the Holders or (c) upon a certificate of the Representative of the holders of Senior Debt or, if there is no Representative, the holders of Senior Debt for the purpose of ascertaining the Persons entitled to participate in such payment or distribution, the holders of Senior Debt and other Debt of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article 12. In the event that the Trustee determines, in good faith, that evidence is required with respect to the right of any Person as a holder of Senior Debt to participate in any payment or distribution pursuant to this Article 12, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of such Senior Debt held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and other facts pertinent to the rights of such Person under this Article 12, and, if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. The provisions of Sections 7.01 and 7.02 shall be applicable to all actions or omissions of actions by the Trustee pursuant to this Article 12.
SECTION 12.14 . TRUSTEE TO EFFECTUATE SUBORDINATION
Each Holder by accepting a Note authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to acknowledge or effectuate the subordination between the Holders and the holders of Senior Debt as provided in this Article 12 and appoints the Trustee as attorney-in-fact for any and all such purposes.
SECTION 12.15 . TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT
The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Debt and shall not be liable to any such holders if it shall mistakenly pay over or distribute to Holders or the Company or any other Person, money or assets to which any holders of Senior Debt shall be entitled by virtue of this Article 12 or otherwise, except if such mistake was the result of the Trustees gross negligence or willful misconduct.
SECTION 12.16 . RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION PROVISIONS
Each Holder by accepting a Note acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration to each holder of any Senior Debt, whether such Senior Debt was created or acquired before or after the issuance of the Notes, to acquire and continue to hold, or to continue to hold, such Senior Debt and such holder of such Senior Debt shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Debt.
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MISCELLANEOUS
SECTION 13.01 . TRUST INDENTURE ACT CONTROLS .
If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.
SECTION 13.02 . NOTICES .
Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), facsimile transmission or overnight air courier guaranteeing next-day delivery, to the others address:
If to the Company:
Great Lakes Dredge & Dock Corporation
2122 York Road
Oak Brook, Illinois 60523
Attention: President and Chief Financial Officer
Telecopier No.: (610) 574-3007
With a copy to:
Kirkland & Ellis LLP
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Dennis M. Myers, P.C.
Telecopier No. (312) 660-0478
If to the Trustee:
BNY Midwest Trust Company
2 N. LaSalle Street Suite 1020
Chicago, Illinois 60602
Attention: Mary Callahan
Telecopier No.: (312) 827-8542
The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to the Trustee or Holders) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if sent by facsimile transmission; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next-day delivery. All notices and communications to the Trustee or Holders shall be deemed duly given and effective only upon receipt.
Any notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next-day delivery to its address shown on the Security Register. Any notice or communication shall also be so mailed to any Person described in TIA § 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.
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If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.
SECTION 13.03 . COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES .
Holders may communicate pursuant to TIA §312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA §312(c).
SECTION 13.04 . CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT .
Upon any request or application by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee:
(a) an Officers Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with.
SECTION 13.05 . STATEMENTS REQUIRED IN CERTIFICATE OR OPINION .
Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA §314(a)(4)) shall comply with the provisions of TIA §314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable such Person to express an informed opinion as to whether or not such covenant or condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.
With respect to matters of fact, an Opinion of Counsel may rely on an Officers Certificate, certificates of public officials or reports or opinions of experts.
SECTION 13.06 . RULES BY TRUSTEE AND AGENTS .
The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.
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SECTION 13.07 . NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS .
No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or of the Subsidiary Guarantors under the Notes, this Indenture, the Subsidiary Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver and release may not be effective to waive or release liabilities under the federal securities laws.
SECTION 13.08 . GOVERNING LAW .
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 13.09 . NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS .
This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 13.10 . SUCCESSORS .
All covenants and agreements of the Company in this Indenture and the Notes shall bind its successors. All covenants and agreements of the Trustee in this Indenture shall bind its successors.
SECTION 13.11 . SEVERABILITY .
In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 13.12 . COUNTERPART ORIGINALS .
The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
SECTION 13.13 . TABLE OF CONTENTS, HEADINGS, ETC .
The Table of Contents, Cross-Reference Table and Headings in this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof.
SECTION 13.14 . QUALIFICATION OF THIS INDENTURE.
The Company shall qualify this Indenture under the TIA in accordance with the terms and conditions of any Registration Rights Agreement and shall pay all reasonable costs and expenses (including attorneys fees and expenses for the Company, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes. The Trustee shall be entitled to receive from the Company any such Officers Certificates, Opinions of Counsel or other documentation as it may reasonably request in connection with any such qualification of this Indenture under the TIA.
[Signatures on following page]
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SIGNATURES
Dated as of December 22, 2003
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COMPANY: |
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GLDD MERGER SUB, INC. |
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By: |
/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Senior Vice President, Chief |
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Financial Officer and Treasurer |
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TRUSTEE: |
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BNY MIDWEST TRUST COMPANY |
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By: |
/s/ Mary Callahan |
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Name: Mary Callahan |
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Title: Assistant Vice President |
EXHIBIT A
(Face of Note)
7 3 / 4 % Senior Subordinated Notes due 2013
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CUSIP |
No. |
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$ |
[GLDD MERGER SUB, INC.]
[GREAT LAKES DREDGE & DOCK CORPORATION]
promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of Dollars ($ ) on December 15, 2013.
Interest Payment Dates: June 15 and December 15, commencing June 15, 2004.
Record Dates: June 1 and December 1.
Dated: , 20[ ].
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IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer.
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[GLDD MERGER SUB, INC.] |
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[GREAT LAKES DREDGE & DOCK CORPORATION] |
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By: |
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Name: |
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Title: |
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
BNY MIDWEST TRUST COMPANY,
as Trustee
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Authorized Signatory |
Dated |
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, 20 |
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(Back of Note)
7¾% Senior Subordinated Notes due 2013
[Insert the Global Note Legend, if applicable pursuant to the terms of the Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the terms of the Indenture]
Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.
1. Interest. [GLDD Merger Sub, Inc.] [Great Lakes Dredge & Dock Corporation], a Delaware corporation ( the Company ), promises to pay interest on the principal amount of this Note at 7¾% per annum until maturity and shall pay Liquidated Damages, if any, as provided in Section 5 of the Registration Rights Agreement. The Company shall pay interest semi-annually on June 15 and December 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an Interest Payment Date ). Interest on the Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from December 22, 2003; provided, however , that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided , further , that the first Interest Payment Date shall be the first of June 15 or December 15 to occur after the date of issuance, unless such June 15 or December 15 occurs within one calendar month of such date of issuance, in which case the first Interest Payment Date shall be the second of June 15 and December 15 to occur after the date of issuance. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time at a rate that is 1% per annum in excess of the interest rate then in effect under the Indenture and this Note; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and Liquidated Damages, if any (without regard to any applicable grace periods), from time to time at the same rate to the extent lawful. Interest shall be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment . The Company shall pay interest on the Notes (except defaulted interest) to the Persons in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the June 1 or December 1 next preceding the Interest Payment Date, even if such Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes shall be payable as to principal, premium, if any, and interest and Liquidated Damages, if any, at the office or agency of the Company maintained for such purpose, or, at the option of the Company, payment of interest may be made by check mailed to the Holders at their addresses set forth in the Security Register; provided , however , that payment by wire transfer of immediately available funds shall be required with respect to principal of and interest and Liquidated Damages, if any, and premium, if any, on, all Global Notes and all other Notes the Holders of which shall have provided wire transfer instructions to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar . Initially, BNY Midwest Trust Company, the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such capacity.
4. Indenture . The Company issued the Notes under an Indenture, dated as of December 22, 2003 ( Indenture ), among [the Company,] [as successor to GLDD Merger Sub, Inc.,] the Guarantors from time to time party thereto and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling. The Notes are obligations of the Company unlimited in aggregate principal amount.
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5. Optional Redemption .
(a) Except as set forth in clause (b) of this Paragraph 5, the Notes will not be redeemable at the option of the Company prior to December 15, 2008. Starting on that date, the Company may redeem all or any portion of the Notes, at once or over time, after giving the required notice under the Indenture. The Notes may be redeemed at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Liquidated Damages, if any, to the applicable redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date), if redeemed during the twelve-month period commencing on December 15 of the years indicated below:
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2008 |
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103.875 |
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2009 |
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2010 |
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101.292 |
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2011 and thereafter |
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100.000 |
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(b) At any time prior to December 15, 2006, the Company may (but will not have the obligation to) on any one or more occasions redeem up to 35% of the aggregate principal amount of the Notes issued under the Indenture at a redemption price (expressed as a percentage of principal amount) equal to 107.750% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date), with the net cash proceeds of one or more Equity Offerings, provided that at least 65% of the aggregate principal amount of the Notes initially issued under the Indenture remain outstanding immediately after the occurrence of the redemption (excluding Notes held by the Company and its Subsidiaries); provided , further , that the redemption shall occur within 180 days of the date of the closing of the Equity Offering.
(c) Any prepayment pursuant to this paragraph shall be made pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.
6. Mandatory Redemption . Except as set forth in Sections 4.12 and 4.18 of the Indenture, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes.
7. Repurchase at Option of Holder .
(a) Upon the occurrence of a Change of Control, each Holder shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of such Holders Notes (a Change of Control Offer ) at a purchase price in cash equal to 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest and Liquidated Damages, if any, on the Notes repurchased, to the Purchase Date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant Interest Payment Date).
(b) If the Company or one of its Restricted Subsidiaries consummates any Asset Sales, they shall not be required to apply any Excess Proceeds in accordance with the Indenture until the aggregate Excess Proceeds from all Asset Sales following the date the Notes are first issued exceeds $10.0 million. Thereafter, the Company shall, after application of the additional aggregate $10.0 million of Excess Proceeds as provided in the fourth paragraph of Section 4.12 of the Indenture, commence an offer for Notes pursuant to the Indenture by applying the Excess Proceeds (an Asset Sale Offer ) pursuant to Section 3.09 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) and, if the Company is required to do so under the terms of any Indebtedness that is pari passu with the Notes, such other Indebtedness on a pro rata basis with the Notes, that may be purchased out of the Excess Proceeds, at an offer price in cash equal to 100% of the principal amount thereof plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer in accordance with the procedures set forth in the Indenture. To the extent that the aggregate amount of Notes (including Additional Notes) and other pari passu Indebtedness tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company (or such Restricted Subsidiary) may use such deficiency for any purpose not
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prohibited by the Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered by holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis. Holders of Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled Option of Holder to Elect Purchase on the reverse of the Notes.
8. Notice of Redemption . Notice of redemption shall be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption.
9. Denominations, Transfer, Exchange . The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. [This Note shall represent the aggregate principal amount of outstanding Notes from time to time endorsed hereon and the aggregate principal amount of Notes represented hereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions.] The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.
10. Persons Deemed Owners . The registered Holder of a Note may be treated as its owner for all purposes.
11. Amendment, Supplement and Waiver . Subject to certain exceptions, the Company and the Trustee may amend or supplement the Indenture or the Notes with the consent of the Holders of a majority in principal amount of the then outstanding Notes, including Additional Notes, if any, voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 of the Indenture, any existing Default or Event of Default (except a continuing Default or Event of Default in the payment of principal, premium, if any, interest or Liquidated Damages, if any, on the Notes) or compliance with any provision of the Indenture or the Notes (except for certain covenants and provisions of the Indenture which cannot be amended without the consent of each Holder) may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of any Holder, the Company and the Trustee may amend or supplement the Indenture or the Notes to cure any ambiguity, defect or inconsistency, to provide for uncertificated notes in addition to or in place of certificated notes, to provide for the assumption of the Companys or a Subsidiary Guarantors obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Companys assets, to provide for the issuance of Additional Notes in accordance with the provisions set forth in this Indenture on the date of this Indenture, to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under the Indenture of any Holder, to comply with requirements of the Commission in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act, to allow any Subsidiary Guarantor to guarantee the Notes, or to conform any provision of the Indenture to the Description of Notes contained in the Offering Memorandum.
12. Defaults and Remedies . Each of the following is an Event of Default under the Indenture: (i) default for 30 days in the payment when due of interest on, or Liquidated Damages with respect to, the Notes (whether or not permitted by Article 12 of the Indenture); (ii) default in payment when due of the principal of or premium, if any, on the Notes (whether or not permitted by Article 12 of the Indenture); (iii) failure by the Company or any of its Restricted Subsidiaries to comply with Section 4.18 of the Indenture; (iv) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice by the Trustee or by the Holders of at least 25% in principal amount of Notes then outstanding to comply with any of its other agreements in the Indenture or the Notes;
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(v) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries) whether the Indebtedness or guarantee now exists, or is created after the date of the Indenture, which default: (A) is caused by a failure to pay principal on such Indebtedness at final stated maturity prior to the expiration of the grace period provided in the Indebtedness on the date of the default (a Payment Default ) or (B) results in the acceleration of the Indebtedness prior to its stated maturity and, in each case, the principal amount of any Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated (after giving effect to any applicable grace period), aggregates $10.0 million or more; (vi) failure by the Company or any of its Restricted Subsidiaries to pay final judgments aggregating in excess of $10.0 million (net of any amount with respect to which a reputable insurance company with assets over $100.0 million has acknowledged liability in writing), which judgments are not paid, discharged or stayed for a period of 60 days after their entry; (vii) certain events of bankruptcy, insolvency or reorganization affecting the Company or any of its Significant Subsidiaries; and (viii) except as permitted by the Indenture, any Subsidiary Guarantee of any Significant Subsidiary (or group of Subsidiary Guarantors that, collectively, would be a Significant Subsidiary) shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect or any Subsidiary Guarantor that is a Significant Subsidiary (or group of Subsidiary Guarantors that, collectively, would be a Significant Subsidiary), or any Person acting on behalf of any Subsidiary Guarantor (or group of Subsidiary Guarantors) that is a Significant Subsidiary, shall deny or disaffirm its obligations under its Subsidiary Guarantee.
If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Upon a declaration of acceleration, such principal and interest will become due and payable upon the earlier to occur of (x) the 5 th day after notice thereof has been given to holders of Designated Senior Debt and (y) the date on which all of the Designated Senior Debt has been accelerated. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency described in the Indenture, all outstanding Notes shall become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest or Liquidated Damages) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest or Liquidated Damages on, or the principal of, the Notes. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.
13. Trustee Dealings with Company . Subject to certain limitations, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee.
14. No Recourse Against Others . No past, present or future director, officer, employee, incorporator or stockholder of the Company or of any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or of the Subsidiary Guarantors under the Indenture, the Notes, the Subsidiary Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability.
15. Authentication . This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.
16. Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
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17. Additional Rights of Holders of Restricted Global Notes and Restricted Definitive Notes . In addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes that are Initial Notes shall have all the rights set forth in the Registration Rights Agreement, dated as of December 22, 2003, among the Company, the Guarantors from time to time party thereto and the initial purchasers named therein or, in the case of Additional Notes, Holders of Restricted Global Notes and Restricted Definitive Notes shall have the rights set forth in one or more Registration Rights Agreements, if any, among the Company and the other parties thereto, relating to rights given by the Company to the purchasers of any Additional Notes.
18. Subordination. Payment of principal, interest and premium and Liquidated Damages, if any, on the Notes is subordinated to the prior payment of Senior Debt on the terms provided in the Indenture.
19. CUSIP Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
20. Governing Law . The internal law of the State of New York shall govern and be used to construe this Note without giving effect to applicable principles of conflicts of law to the extent that the application of the laws of another jurisdiction would be required thereby.
The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:
[GLDD Merger Sub, Inc.]
[Great Lakes Dredge & Dock Corporation]
2122 York Road
Oak Brook, Illinois 60523
Attention: [Chief Financial Officer]
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Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the Company pursuant to Section 4.12 or 4.18 of the Indenture, check the box below:
o Section 4.12
o Section 4.18
If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.12 or Section 4.18 of the Indenture, state the amount you elect to have purchased: $
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Assignment Form
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to
(Insert assignees social security or other tax I.D. no.)
(Print or type assignees name, address and zip code)
and irrevocably appoint
as agent to transfer this Note on the books of the Company. The agent may substitute another to act for him.
Date: |
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Your Signature: |
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(Sign exactly as your name appears on the face of this Note) |
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Signature Guarantee: |
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:
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EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Great Lakes Dredge & Dock Corporation
2122 York Road
Oak Brook, IL 60523
Attention: Chief Financial Officer
Telecopier No.: (610) 574-3007
BNY Midwest Trust Company
2 N. LaSalle Street Suite 1020
Chicago, IL 60602
Attention: Corporate Trust Department
Telecopier No.: (312) 827-8542
Re: 7 3 / 4 % Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of December 22, 2003 (the Indenture ), among Great Lakes Dredge & Dock Corporation, as successor to GLDD Merger Sub, Inc., as issuer (the Company ), the Guarantors from time to time party there to and BNY Midwest Trust Company, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
, (the Transferor ) owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $ in such Note[s] or interests (the Transfer ), to (the Transferee ), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. o Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A . The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the Securities Act ), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a qualified institutional buyer within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act.
2. o Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S . The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Distribution Compliance Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the
B-1
terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note, the Temporary Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act.
3. o Check and complete if Transferee will take delivery of a beneficial interest in the IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S . The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one):
(a) o such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;
or
(b) o such Transfer is being effected to the Company or a subsidiary thereof;
or
(c) o such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act;
or
(d) o such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) if such Transfer is in respect of a principal amount of Notes at the time of transfer of less than $250,000, an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or the Definitive Notes and in the Indenture and the Securities Act.
4. o Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note .
(a) o Check if Transfer is pursuant to Rule 144 . (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.
(b) o Check if Transfer is Pursuant to Regulation S . (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United
B-2
States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.
(c) o Check if Transfer is Pursuant to Other Exemption . (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your benefit and the benefit of the Company.
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B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) o a beneficial interest in the:
(i) o 144A Global Note (CUSIP ), or
(ii) o Regulation S Global Note (CUSIP ), or
(iii) o IAI Global Note (CUSIP ); or
(b) o a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE OF (a), (b) OR (c)]
(a) o a beneficial interest in the:
(i) o 144A Global Note (CUSIP ), or
(ii) o Regulation S Global Note (CUSIP ), or
(iii) o IAI Global Note (CUSIP ); or
(iv) o Unrestricted Global Note (CUSIP ); or
(b) o a Restricted Definitive Note; or
(c) o an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Great Lakes Dredge & Dock Corporation
2122 York Road
Oak Brook, IL 60523
Attention: Chief Financial Officer
Telecopier No.: (610) 574-3007
BNY Midwest Trust Company
2 N. LaSalle Street Suite 1020
Chicago, IL 60602
Attention: Corporate Trust Department
Telecopier No.: (312) 827-8542
Re: 7 3 / 4 % Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of December 22, 2003 (the Indenture ), among Great Lakes Dredge & Dock Corporation, as successor to GLDD Merger Sub, Inc., as issuer (the Company ), the Guarantors from time to time party thereto and BNY Midwest Trust Company, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
, (the Owner ) owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $ in such Note[s] or interests (the Exchange ). In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note
(a) o Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted Global Note . In connection with the Exchange of the Owners beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owners own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the Securities Act ), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
(b) o Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive Note . In connection with the Exchange of the Owners beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owners own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
(c) o Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global Note . In connection with the Owners Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owners own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
(d) o Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive Note . In connection with the Owners Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the
C-1
Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owners own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes
(a) o Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive Note . In connection with the Exchange of the Owners beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owners own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act.
(b) o Check if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global Note . In connection with the Exchange of the Owners Restricted Definitive Note for a beneficial interest in the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owners own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Definitive Note and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for your benefit and the benefit of the Company.
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C-3
EXHIBIT D
FORM
OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Great Lakes Dredge & Dock Corporation
2122 York Road
Oak Brook, IL 60523
Attention: Chief Financial Officer
Telecopier No.: (610) 574-3007
BNY Midwest Trust Company
2 N. LaSalle Street Suite 1020
Chicago, IL 60602
Attention: Corporate Trust Department
Telecopier No.: (312) 827-8542
Re: 7 3 / 4 % Senior Subordinated Notes due 2013
Reference is hereby made to the Indenture, dated as of December 22, 2003 (the Indenture ), among Great Lakes Dredge & Dock Corporation, as successor to GLDD Merger Sub, Inc., as issuer (the Company ), the Guarantors from time to time party thereto and BNY Midwest Trust Company, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $ aggregate principal amount of:
(a) o a beneficial interest in a Global Note, or
(b) o a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the Securities Act ).
2. We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a qualified institutional buyer (as defined therein), (C) to an institutional accredited investor (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, if such transfer is in respect of a principal amount of Notes, at the time of transfer of less than $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance with the Securities Act, (D) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect.
4. We are an institutional accredited investor (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for
D-1
which we are acting are each able to bear the economic risk of our or its investment. We have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of the Company and receive answers thereto, as we deem necessary in connection with our decision to purchase the Notes.
5. We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional accredited investor) as to each of which we exercise sole investment discretion and are not acquiring the Notes with a view to any distribution thereof in a transaction that would violate the Securities Act of the securities laws of any state of the United States or any other applicable jurisdiction.
You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. This letter shall be governed by, and construed in accordance with, the laws of the State of New York.
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D-2
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any successor Person under the Indenture), jointly and severally, unconditionally guarantees, to the extent set forth in the Indenture and subject to the provisions in the Indenture, dated as of December 22, 2003 (the Indenture ), among [Great Lakes Dredge & Dock Corporation, as successor to] GLDD Merger Sub, Inc., as issuer (the Company ), the Guarantors from time to time party thereto and BNY Midwest Trust Company, as trustee (the Trustee ), (a) the due and punctual payment of the principal of, premium, if any, and interest and Liquidated Damages, if any, on the Notes, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on overdue principal and premium, if any, and, to the extent permitted by law, interest and Liquidated Damages, if any, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the Guarantors to the Holders of Notes and to the Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article 10 of the Indenture and reference is hereby made to the Indenture for the precise terms of the Guarantee. This Guarantee is subject to release as and to the extent set forth in Sections 8.02, 8.03 and 10.05 of the Indenture. Each Holder of a Note, by accepting the same agrees to and shall be bound by such provisions. Capitalized terms used herein and not defined are used herein as so defined in the Indenture.
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Incurrence of Indebtedness and Issuance of Disqualified Stock. |
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Dividend and Other Payment Restrictions Affecting Subsidiaries |
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Repurchase at the Option of Holders Upon a Change of Control |
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ii
iii
iv
CROSS-REFERENCE TABLE
TIA Section Reference |
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Indenture
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310(a)(1) |
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7.10 |
(a)(2) |
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7.10 |
(a)(3) |
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N.A. |
(a)(4) |
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N.A. |
(a)(5) |
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7.10 |
(b) |
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7.08, 7.10 |
(c) |
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N.A. |
311(a) |
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7.11 |
(b) |
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7.11 |
(c) |
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N.A. |
312(a) |
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2.05 |
(b) |
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11.03 |
(c) |
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11.03 |
313(a) |
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7.06 |
(b)(1) |
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N.A. |
(b)(2) |
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7.06, 7.07 |
(c) |
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7.06, 11.02 |
(d) |
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7.06 |
314(a) |
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4.03, 4.04, 11.02 |
(b) |
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N.A. |
(c)(1) |
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12.04 |
(c)(2) |
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12.04 |
(c)(3) |
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N.A. |
(d) |
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N.A. |
(e) |
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12.05 |
315(a) |
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7.01 |
(b) |
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7.05, 11.02 |
(c) |
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7.01 |
(d) |
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7.01 |
(e) |
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6.11 |
316(a) (last sentence) |
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2.09 |
(a)(1)(A) |
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6.05 |
(a)(1)(B) |
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6.04 |
(a)(2) |
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N.A. |
(b) |
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6.07 |
317(a)(1) |
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6.08 |
(a)(2) |
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6.09 |
(b) |
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2.04 |
318(a) |
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11.01 |
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.
Exhibit 4.2
SUPPLEMENTAL INDENTURE
This Supplemental Indenture (this Supplemental Indenture ), dated as of December 22, 2003, by and among Great Lakes Dredge & Dock Company, a New Jersey corporation, Great Lakes Caribbean Dredging, Inc., a Delaware corporation, Dawson Marine Services Company, a Delaware corporation, North American Site Developers, Inc., a Massachusetts corporation, and Fifty-Three Dredging Corporation, a New Jersey corporation (each a Guaranteeing Subsidiary and, collectively, the Guaranteeing Subsidiaries ), each of which is a direct or indirect subsidiary of Great Lakes Dredge & Dock Corporation, a Delaware corporation (the Company ), the Company and BNY Midwest Trust Company, as trustee under the Indenture referred to below (the Trustee ).
W I T N E S S E T H
WHEREAS, GLDD Merger Sub, Inc. ( GLDD ) has heretofore executed and delivered to the Trustee an indenture (the Indenture ), dated as of December 22, 2003, providing for the issuance of 7 3/4% Senior Subordinated Notes due 2013 (the Notes );
WHEREAS, upon the merger of GLDD with and into the Company pursuant to the Merger Agreement, all of the obligations of GLDD under the Indenture become obligations of the Company;
WHEREAS, the Indenture provides that under certain circumstances each Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which such Guaranteeing Subsidiary shall unconditionally guarantee all of the Companys obligations under the Notes and the Indenture on the terms and conditions set forth herein and in the Indenture; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, each Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows:
1. Capitalized Terms . Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.
2. Assumption of Obligations . The Company hereby expressly assumes all of the respective obligations of GLDD as issuer of the Notes under the Indenture.
3. Agreement to Guarantee . Each of the Guaranteeing Subsidiaries hereby agrees to become subject to the terms of the Indenture as a Subsidiary Guarantor.
4. Incorporation of Terms of Indenture . The obligations of the Guaranteeing Subsidiaries under the Subsidiary Guarantees shall be governed in all respects by the terms of the Indenture and shall constitute a Subsidiary Guarantee thereunder. Each of the Guaranteeing Subsidiaries shall be bound by the terms of the Indenture as they relate to the Subsidiary Guarantees.
5. No Recourse Against Others . No past, present or future director, officer, employee, incorporator or stockholder of any Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, the Indenture, any Subsidiary Guarantees or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver and release may not be effective to waive or release liabilities under the federal securities laws.
6. Governing Law . THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
7. Counterparts . The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
8. Effect of Headings . The headings in this Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part of this Supplemental Indenture and shall in no way modify or restrict any of the terms or provisions hereof.
9. Trustee . The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiaries and the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of December 22, 2003.
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GREAT LAKES
DREDGE & DOCK
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/s/ Douglas B. Mackie |
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Name: Douglas B. Mackie |
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Title: President and Chief Executive Officer |
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GREAT LAKES DREDGE & DOCK COMPANY |
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/s/ Douglas B. Mackie |
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Name: Douglas B. Mackie |
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Title: President and Chief Executive Officer |
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GREAT LAKES CARIBBEAN DREDGING, INC. |
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/s/ Douglas B. Mackie |
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Name: Douglas B. Mackie |
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Title: President and Chief Executive Officer |
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DAWSON MARINE SERVICES COMPANY |
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/s/ Douglas B. Mackie |
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Name: Douglas B. Mackie |
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Title: President and Chief Executive Officer |
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NORTH AMERICAN SITE DEVELOPERS, INC. |
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By: |
/s/ Douglas B. Mackie |
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Name: Douglas B. Mackie |
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Title: Chief Executive Officer |
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FIFTY-THREE DREDGING CORPORATION |
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By: |
/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Vice President |
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BNY MIDWEST TRUST COMPANY, AS TRUSTEE |
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/s/ Mary Callahan |
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Name: Mary Callahan |
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Title: Assistant Vice President |
Exhibit 10.1
EXECUTION VERSION
$120,300,000
CREDIT AGREEMENT
dated as of December 22, 2003
among
GLDD ACQUISITIONS CORP.,
as Holdings,
GREAT LAKES DREDGE & DOCK CORPORATION,
as the Borrower,
THE OTHER LOAN PARTIES HERETO,
as Loan Parties,
THE FINANCIAL INSTITUTIONS FROM TIME TO TIME
PARTY HERETO,
as the Lenders,
LEHMAN BROTHERS INC.
and
CREDIT SUISSE FIRST BOSTON,
ACTING THROUGH ITS CAYMAN ISLANDS BRANCH,
as Joint Advisors, Joint Lead Arrangers
and Joint Book Runners
and
BANK OF AMERICA, N.A.,
as an Issuing Lender and the Administrative Agent
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (including all Schedules and Exhibits hereto, this Agreement ) dated as of December 22, 2003, among GLDD ACQUISITIONS CORP., a Delaware corporation ( Holdings ), GREAT LAKES DREDGE & DOCK CORPORATION, a Delaware corporation (the Borrower ), the OTHER LOAN PARTIES FROM TIME TO TIME PARTY HERETO (collectively, together with the Borrower and Holdings, the Loan Parties ), the FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTY HERETO (the Lenders ), LEHMAN BROTHERS INC. ( Lehman Brothers ) and CREDIT SUISSE FIRST BOSTON, ACTING THROUGH ITS CAYMAN ISLANDS BRANCH ( CSFB ), as Joint Advisors, Joint Lead Arrangers and Joint Book Runners (Lehman Brothers and CSFB together in such capacities, the Arrangers ), and BANK OF AMERICA, N.A. ( Bank of America ), as an issuer of the Letters of Credit (in such capacity an Issuing Lender ), and as representative for the Lenders (in such representative capacity, together with any successor representative appointed pursuant to Section 8.9 , the Administrative Agent ).
WHEREAS, the Borrower, the other Loan Parties (other than Holdings), Bank of America and certain of the Lenders and other financial institutions (collectively, the Existing Lenders ) are currently parties to that certain Credit Agreement dated as of August 19, 1998 (as the same may have been heretofore amended or amended and restated, the Existing Credit Agreement );
WHEREAS, Holdings, formed by affiliates of Madison Dearborn Partners IV, L.P. ( MDP ) and certain co-investors including certain members of the management of the Borrower, plans to acquire (the Acquisition ) by means of a merger, all of the issued and outstanding common stock of the Borrower;
WHEREAS, to finance the Acquisition, in part, to facilitate the repayment of certain outstanding debt of the Borrower and its Subsidiaries and the payment of fees and expenses in connection with the Acquisition and related refinancing, and for general corporate purposes, the Borrower has requested that the Lenders make available (i) a $60,000,000 revolving credit and letter of credit facility and (ii) a $60,300,000 Tranche B Term Loan Facility;
WHEREAS, the Borrower has requested that the Lenders and the Issuing Lenders make available, for the purposes specified in this agreement, such revolving credit and letter of credit facility and Tranche B Term Loan Facility, all on the terms and conditions set forth herein;
WHEREAS, the Lenders and the Issuing Lenders are willing to make available to the Borrower such credit facilities, upon the terms and subject to the conditions set forth herein;
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NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree as follows:
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ARTICLE I
.
DEFINITIONS AND INTERPRETATION
SECTION 1.1 . Defined Terms . Capitalized terms (whether or not underscored) used in this Agreement, including its preamble, shall (unless a clear contrary intention explicitly appears) have the respective meanings assigned thereto in Schedule I .
SECTION 1.2 . Use of Defined Terms . Unless otherwise defined or the context otherwise explicitly requires, terms for which meanings are provided in this Agreement shall have such meanings when used in the Schedules and each Notice of Borrowing, Continuation/Conversion Notice, Compliance Certificate, Assignment and Acceptance, notice and other communication delivered from time to time in connection with this Agreement or any other Loan Document.
SECTION 1.3 . Interpretation . In this Agreement and each other Loan Document, unless a clear contrary intention explicitly appears:
(a) the singular number includes the plural number and vice versa ;
(b) reference to any Person includes such Persons successors and assigns but, if applicable, only if such successors and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;
(c) reference to any gender includes each other gender;
(d) unless explicitly provided otherwise herein, reference to any agreement (including this Agreement and the Schedules and Exhibits hereto), document or instrument means such agreement, document or instrument as amended, restated, supplemented or modified and in effect from time to time in accordance with the terms thereof and, if applicable, the terms hereof and reference to any promissory note includes any promissory note which is an extension or renewal thereof or a substitute or replacement therefor;
(e) reference to any Applicable Law means such Applicable Law as amended, modified, codified or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder;
(f) unless the context explicitly indicates otherwise, reference to the preamble or any Article, Section, Schedule or Exhibit means the preamble hereto or such Article, or Section hereof or Schedule or Exhibit hereto;
(g) hereunder, hereof, hereto and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Article, Section or other provision hereof;
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(h) including (and with correlative meaning include) means including without limiting the generality of any description preceding such term; and
(i) relative to the determination of any period of time, from means from and including, to means to but excluding, and through means to and including .
SECTION 1.4 . Accounting Terms . All accounting terms not specifically defined herein shall be construed in accordance with GAAP. Except as otherwise provided herein, if any changes in accounting principles from those used in the preparation of the most recent financial statements referred to in Section 5.1(f ) are hereafter required or permitted by the rules, regulations, pronouncements and opinions of the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (or successors thereto or agencies with similar functions) and are adopted by Holdings or the Borrower with the agreement of its independent certified public accountants and such changes result in a change in the method of calculation of any of the financial covenants, standards or terms found in Section 6.3 or in the related definitions of terms used therein, the parties hereto agree to enter into negotiations in order to amend such provisions so as to reflect equitably such changes with the desired result that the criteria for evaluating the Borrowers financial condition shall be the same after such changes as if such changes had not been made, provided that no change in GAAP that would affect the method of calculation of any of the financial covenants, standards or terms shall be given effect in such calculations until such provisions are amended, in a manner satisfactory to the Majority Lenders, so as to reflect such change in accounting principles.
ARTICLE II
.
AMOUNT AND TERM OF COMMITMENTS
SECTION 2.1 . Commitments . The Lenders shall make Loans to or for the benefit of the Borrower in accordance with their respective Commitments as provided below in this Section 2.1 .
SECTION 2.1.1 . Revolving Commitment . On the terms and subject to the conditions of this Agreement (including Article IV ), each Lender severally and for itself alone agrees to make Revolving Loans to, and to issue or participate in the issuance of Letters of Credit for the account of, the Borrower pursuant to its Revolving Commitment, as described in this Article II and in Article III , respectively. From time to time on any Business Day occurring prior to the Revolving Commitment Termination Date, each Lender, severally and for itself alone, agrees to make revolving loans in Dollars (relative to such Lender, its Revolving Loans ) to the Borrower equal to such Lenders Revolving Credit Percentage of the aggregate amount of the applicable Borrowing requested by the Borrower to be made on such day pursuant to this Section 2.1.1 . The commitment of each Lender described in this Section 2.1.1 is herein referred to as its Revolving Commitment and shall be in the amount set forth on Schedule 1 to the Lender Addendum of such Lender as such Lenders Revolving Commitment; provided , however that (a) the aggregate principal amount of all Revolving Loans which
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any Lender shall be committed to have outstanding hereunder shall not at any time exceed the product of (i) such Lenders Revolving Credit Percentage multiplied by (ii) the Availability and (b) the aggregate principal amount of all Revolving Loans which the Lenders shall be committed to have outstanding hereunder shall not at any time exceed the Availability. On the terms and subject to the conditions hereof, the Borrower may from time to time borrow, prepay and reborrow Revolving Loans.
SECTION 2.1.2. Tranche B Term Commitment . On the terms and subject to the conditions of this Agreement (including Article IV ), each Lender severally and for itself alone agrees to make a single term loan (relative to such Lender, its Tranche B Term Loan ) on the Closing Date to the Borrower pursuant to, and in an aggregate principal amount equal to, its Tranche B Term Commitment. The commitment of each Lender described in this Section 2.1.2 is herein referred to as its Tranche B Term Commitment and shall be in the amount set forth on Schedule 1 to the Lender Addendum of such Lender as such Lenders Tranche B Term Commitment.
SECTION 2. 2. Reduction of Revolving Commitment Amount . The Borrower shall have the right, upon not less than two Business Days notice to the Administrative Agent, to terminate the Revolving Commitments or, from time to time, to reduce the aggregate amount of the Revolving Commitments; provided that no such termination or reduction of Revolving Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Loans made on the effective date thereof, the total Revolving Extensions of Credit would exceed the Revolving Commitments. Any such reduction shall be in an amount equal to $1,000,000, or a multiple of $500,000 in excess thereof, and shall reduce permanently the Revolving Commitments then in effect.
SECTION 2.3 . Various Types of Loans . Each Loan shall be either a Base Rate Loan or a Eurodollar Rate Loan (each a type of Loan), as the Borrower shall specify in the related Notice of Borrowing or Continuation/Conversion Notice pursuant to Section 2.4 or 2.6 ; provided , however , that the Borrower may not request or have outstanding Eurodollar Rate Loans having more than ten (10) different Interest Periods.
SECTION 2.4 . Borrowing Procedures . (a) The Borrower shall give notice to the Administrative Agent of each proposed Borrowing not later than (i) in the case of a Borrowing of Base Rate Loans, 11:00 A.M. (Chicago time) on the proposed date of such Borrowing and (ii) in the case of a Borrowing of Eurodollar Rate Loans, 11:00 A.M. (Chicago time) at least two (2) Business Days prior to the proposed date of such Borrowing. Each such notice (a Notice of Borrowing ) shall be requested by telephone with same day written confirmation by facsimile transmission, substantially in the form of Exhibit B hereto, specifying therein the date, the amount and type of such Borrowing and, in the case of a Borrowing of Eurodollar Rate Loans, the initial Interest Period therefor. Each Borrowing shall be in Dollars. All Loans requested on the Closing Date shall be Base Rate Loans. Promptly following receipt of any such notice, the Administrative Agent shall advise each Lender thereof.
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(b) Each Lender receiving such notice in a prompt manner (as described in the last sentence of clause (a) above) shall, before 2:00 P.M. (Chicago time) on the date of each proposed Borrowing, make available for the account of its Applicable Lending Office at the principal office of the Administrative Agent in same day funds such Lenders Revolving Credit Percentage of such Borrowing. Subject to Section 2.4(f) , after the Administrative Agents receipt of such funds and upon fulfillment of the applicable conditions set forth in Article IV , the Administrative Agent will make such funds available to the Borrower to such account as the Borrower shall designate from time to time.
(c) Any Lender which does not make funds available at the applicable time specified under this Section 2.4 (any such Lender a Defaulting Lender ) shall pay to the Administrative Agent on demand interest thereon at the Federal Funds Rate for the number of days from the date of the applicable Borrowing to the date on which such amount becomes immediately available to the Administrative Agent, together with such other compensatory amounts as may be required to be paid by such Lender to the Administrative Agent pursuant to the Rules for Interbank Compensation of the Council on International Banking or the Clearinghouse Compensation Committee, as the case may be, as in effect from time to time. A statement of the Administrative Agent submitted to any Lender with respect to any amounts owing under this Section 2.4 shall be conclusive in the absence of manifest error. If such amount is not in fact made available to the Administrative Agent by such Lender on the same Business Day as the date of such Borrowing, the Administrative Agent shall be entitled to recover such amount from the Borrower (net of any amount received from the Defaulting Lender pursuant to the provisions of the first sentence of this Section), with interest thereon at the rate then applicable to the Loans comprising such Borrowing, on demand, provided that such payment by the Borrower shall in no way limit or restrict its ability to hold such Lender liable for its failure to so fund.
(d) Each Borrowing consisting of Eurodollar Rate Loans or Base Rate Loan, shall be in an aggregate amount not less than $1,000,000, or an integral multiple of $500,000 in excess thereof.
(e) Each Notice of Borrowing (whether in writing or by telephone) shall be irrevocable and binding on the Borrower. The Borrower shall provide the Administrative Agent with documents reasonably satisfactory to the Administrative Agent indicating the names of those employees of the Borrower authorized by the Borrower to make telephonic requests for Loans and continuations and conversions thereof, and the Administrative Agent shall be entitled to rely upon such documentation until notified in writing by the Borrower of any change(s) in the names of the employees so authorized. The Administrative Agent shall be entitled, in the absence of willful misconduct, bad faith or gross negligence, to act on the instructions of anyone identifying himself as one of the persons authorized to request Loans and continuations and conversions thereof by telephone and the Borrower shall be bound thereby in the same manner as if the Person were actually so authorized. The Borrower agrees to indemnify and hold the Administrative Agent and each Lender harmless from any and all claims, damages, liabilities, losses, and reasonable out-of-pocket costs and expenses (including
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Attorney Costs and excluding loss of anticipated profits) which may arise or be created by the acceptance of instructions for making, continuing or converting any Loans by telephone, in the absence of willful misconduct, bad faith or gross negligence. In the case of any request for a Borrowing of Eurodollar Rate Loans, the Borrower shall indemnify each Lender against any loss, cost or expense incurred by such Lender as a result of any failure (i) to fulfill on or before the date specified in such Notice of Borrowing for such Borrowing the applicable conditions set forth in Article IV or (ii) to otherwise make the Borrowing in accordance with such Notice of Borrowing, including any loss (excluding loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund the Loan to be made by such Lender as part of such Borrowing when such Loan, as a result of such failure, is not made on such date.
(f) Unless the Administrative Agent shall have received notice from a Lender prior to the date of any Borrowing that such Lender will not make available to the Administrative Agent such Lenders Revolving Credit Percentage of such Borrowing, the Administrative Agent may assume that such Lender has made such Revolving Credit Percentage available to the Administrative Agent on the date of such Borrowing in accordance with Section 2.4(b) and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If and to the extent that such Lender shall not have made such Percentage available to the Administrative Agent, such Lender and the Borrower severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon (net of any amounts received from such Defaulting Lender in respect of such Defaulting Lenders Percentage of such Borrowing), for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Administrative Agent, at (i) in the case of the Borrower, the interest rate applicable at the time to Loans comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If such Lender shall repay to the Administrative Agent such corresponding amount, such amount so repaid shall constitute such Lenders Loans as part of such Borrowing for purposes of this Agreement.
(g) The failure of any Lender to make the Loans to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Loan on the date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Loan to be made by such other Lender on the date of any Borrowing.
SECTION 2.5 . Evidence of Loans . The Loans made by each Lender shall, if requested by such Lender, be evidenced by the Notes payable to such Lender. All Loans and payments hereunder shall be recorded on the books of the Lender making such Loan or receiving such payment, which shall be rebuttable presumptive evidence of the amount of such Loans outstanding at any time hereunder. Notwithstanding any term or condition of this Agreement to the contrary, however, the failure of any Lender to record the date and amount of any Loan made by such Lender hereunder or error in so recording shall not limit or otherwise affect the obligations of the Borrower to repay any such Loan and interest thereon; provided that if there is an error in so recording there
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shall be a rebuttable presumption that the records of the Administrative Agent are true and correct as to the amount of the Loan.
SECTION 2.6. Continuation/Conversion Procedures . Subject to Sections 2.3 and 2.4 , the Borrower may convert any outstanding Loans of one type into Loans of another type or continue any outstanding Eurodollar Rate Loan as a Eurodollar Rate Loan, in each case by giving notice thereof to the Administrative Agent not later than 11:00 A.M. (Chicago time), (a) in the case of a conversion of a Eurodollar Rate Loan into a Base Rate Loan, on or before the proposed date of such conversion and (b) in the case of a continuation of a Eurodollar Rate Loan as, or a conversion of a Base Rate Loan into, a Eurodollar Rate Loan, at least two (2) Business Days prior to the proposed date of such continuation or conversion; provided , that Eurodollar Rate Loans may be continued or converted only as of the last day of the Interest Period applicable thereto (unless all payments which are due, if any, under Section 2.11 are made in connection with such continuation or conversion). Each such notice (a Continuation/Conversion Notice ) shall be by telephone with same day written confirmation by facsimile transmission substantially in the form of Exhibit C , specifying therein the date and amount of such continuation or conversion, the type of the Loan to be so converted or continued, and, in the case of a continuation of or conversion into a Eurodollar Rate Loan, the new Interest Period therefor. Promptly upon receipt of such notice (which shall be effective upon receipt by the Administrative Agent), the Administrative Agent shall advise each Lender thereof. Subject to Sections 2.18 and 2.19 , such Loan shall be so converted or continued on the requested date of conversion or continuation; provided that each conversion or continuation shall be on a Business Day and, after giving effect to any such conversion or continuation, the aggregate principal amount of each outstanding Eurodollar Rate Loan shall be at least $1,000,000 and an integral multiple of $500,000. Each Eurodollar Rate Loan shall automatically convert to a Base Rate Loan at the end of the Interest Period applicable thereto, unless (i) in the case of an expiring Eurodollar Rate Loan, the Borrower shall have delivered to the Administrative Agent a Continuation/Conversion Notice not less than two (2) nor more than ten (10) Business Days prior to the last day of the Interest Period applicable thereto, and (ii) all of the other conditions contained in this Section 2.6 are satisfied.
SECTION 2.7 . Pro Rata Treatment . All Borrowings, continuations, conversions, prepayments, repayments and mandatory and voluntary Revolving Commitment Amount reductions shall be effected so that after giving effect thereto each Lender will have a ratable share (according to its Percentage) of all Loans and Letters of Credit and of the Revolving Commitment Amount.
SECTION 2.8 . Principal Payments . Repayments and prepayments of principal of the Loans shall be made in accordance with this Section 2.8 .
SECTION 2.8.1 . Repayments and Prepayments .
The Borrower will make payment in full in Dollars of all unpaid principal of all Revolving Loans and all other principal Obligations which are then outstanding (other than the outstanding principal balance of the Tranche B Term Loans and the
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accrued interest thereon) on the Revolving Commitment Termination Date. The Borrower will make payment in full in Dollars of all unpaid principal amounts of all Tranche B Term Loans on the Tranche B Term Loan Maturity Date. Without limiting the foregoing, and in addition thereto, the Borrower:
(a) may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of any Loans; provided that:
(i) any such prepayment of a Eurodollar Rate Loan prior to the last day of the Interest Period for such Loan shall be subject to Section 2.11 ,
(ii) no such prepayment of a Eurodollar Rate Loan may be made which, after giving effect thereto, would result in the aggregate outstanding principal amount of any remaining Eurodollar Rate Loans to be equal to an amount other than $1,000,000 or an integral multiple of $500,000 in excess thereof,
(iii) each such voluntary prepayment shall require written notice by 11:00 A.M. (Chicago time) on such Business Day but no more than five (5) Business Days prior to such prepayment, and
(iv) each such voluntary prepayment shall be in a minimum amount of $1,000,000 and an integral multiple of $500,000 in excess thereof (or, if less, the aggregate principal amount of all Loans outstanding);
(b) shall, on each date when the Administrative Agent receives proceeds of Collateral from the Lender First Proceeds Account, or otherwise pursuant to Section 3.3(a) of the Intercreditor Agreement, be deemed to have made, and the Borrower shall cause to be made, a mandatory prepayment of the Loans in an amount equal to such proceeds;
(c) shall, unless the Required Prepayment Lenders and the Borrower shall otherwise agree, and subject to the Intercreditor Agreement, upon the consummation of any Disposition of any property of the Borrower or any of its Subsidiaries (excluding (i) Dispositions permitted under Section 6.2(g ) and (ii) Permitted Dispositions, but including Permitted Dispositions to the extent a prepayment is required pursuant to the clause (c)(iii)(B) of the definition of such term) or Recovery Event, unless a Reinvestment Notice shall be delivered in respect thereof, make a mandatory prepayment of the Loans in an amount equal to the Net Cash Proceeds with respect to such transaction within three (3) Business Days of the receipt by the Borrower or any of its Subsidiaries of the Net Cash Proceeds ( provided that the Borrower shall promptly provide notice to the Administrative Agent of the receipt of such Net Cash Proceeds) of such Disposition or Recovery Event; provided , however , that, notwithstanding the foregoing, (i) the aggregate Net Cash Proceeds of any Recovery Events that may be excluded from the foregoing application requirement pursuant to a Reinvestment Notice shall not exceed $10,000,000 in any fiscal year of the Borrower (provided that the
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foregoing limitation on reinvesting Net Cash Proceeds of any Recovery Event in excess of $10,000,000 in any Fiscal Year shall in no event limit or restrict the ability of the Borrower to reinvest Net Cash Proceeds, through the delivery of a Reinvestment Notice, of any Recovery Event relating to a vessel that does not constitute an actual or constructive total loss of such vessel) and (ii) on each Reinvestment Prepayment Date the Tranche B Term Loans or Revolving Loans, as applicable, shall be prepaid by an amount equal to the Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event, as set forth above. The provisions of this Section do not constitute a consent to the consummation of any transaction not permitted by this Agreement;
(d) shall, unless the Required Prepayment Lenders and the Borrower shall otherwise agree, upon the consummation of any issuance, incurrence or sale of any Debt by the Borrower or any of its Subsidiaries (other than Debt of the type described in Section 6.2(i) ), make a mandatory prepayment of the Loans in an amount equal to the Net Cash Proceeds with respect to such transaction within three (3) Business Days of the receipt by the Borrower or any of its Subsidiaries of the Net Cash Proceeds ( provided that the Borrower shall promptly provide notice to the Administrative Agent of the receipt of such Net Cash Proceeds) of such issuance, incurrence or sale of Debt;
(e) shall, unless the Required Prepayment Lenders and the Borrower shall otherwise agree, upon the consummation of any issuance or sale of any Capital Stock of Holdings or any of its Subsidiaries by Holdings or any of its Subsidiaries (other than a Permitted Capital Stock Issuance), make a mandatory prepayment of the Loans in an amount equal to the Net Cash Proceeds with respect to such transaction within three (3) Business Days of the receipt by the Borrower or any of its Subsidiaries of the Net Cash Proceeds ( provided that the Borrower shall promptly provide notice to the Administrative Agent of the receipt of such Net Cash Proceeds) of such issuance or sale of Capital Stock;
(f) shall, unless the Required Prepayment Lenders and the Borrower shall otherwise agree, upon the consummation of the refinancing of the Debt of Amboy Aggregates guarantied by the Borrower, make a mandatory prepayment of the Loans in an amount equal to the amount by which the maximum amount of the guaranty of the refinanced Debt by the Borrower exceeds $3,000,000 within thirty (30) days of the consummation of such refinancing ( provided that the Borrower shall promptly provide notice to the Administrative Agent of the consummation of such refinancing);
(g) shall, from time to time, make mandatory prepayments of the Revolving Loans in such amounts and at such times as may be necessary to (i) prevent the aggregate outstanding principal amount of all Revolving Loans from exceeding Availability and (ii) to the extent achievable through the prepayment of Revolving Loans, prevent the aggregate outstanding Letter of Credit Obligations from exceeding the Letter of Credit Availability;
(h) shall, immediately upon any acceleration of the maturity of any Loans pursuant to Section 7.2 , repay all Loans; and
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(i) each repayment and prepayment of any Loans made pursuant to this Section 2.8.1 shall be without premium or penalty, except as may be required by Section 2.11 , and shall be applied in accordance with Section 2.8.2 . No mandatory or voluntary prepayment of principal of the Loans shall cause a permanent reduction in the Revolving Commitment Amount, except as provided in Sections 2.2 and 7.2 .
SECTION 2.8.2 . Application .
(a) Amounts to be applied in connection with the voluntary and mandatory prepayments paid pursuant to the provisions of clauses (a) through (f) of Section 2.8.1 shall be applied, first , to the prepayment of the Tranche B Term Loans and second , to the repayment of any outstanding Revolving Loans (without any permanent reduction to the Revolving Commitments).
(b) Notwithstanding anything to the contrary in Section 2.8.1 or 2.8.2(a) , each Tranche B Term Loan Lender may, at its option, decline up to 100% of the portion of any mandatory payment applicable to the Tranche B Term Loans of such Lender; accordingly, with respect to the amount of any mandatory prepayment described in Section 2.8.1 that is allocated to the Tranche B Term Loans (such amounts, the Mandatory Prepayment Amount ), on the date specified in Section 2.8.1 for such prepayment (or if no date is specified, the date on which such mandatory prepayment is to occur), the Borrower will (A) give the Administrative Agent telephonic notice (promptly confirmed in writing) requesting that the Administrative Agent prepare and provide to each Tranche B Term Loan Lender a notice (each a Prepayment Option Notice ) as described below and (B) deposit with the Administrative Agent the Mandatory Prepayment Amount.
(c) As promptly as practicable after receiving such notice from the Borrower, the Administrative Agent will send to each Tranche B Term Loan Lender a Prepayment Option Notice, which shall be substantially in the form of Exhibit H , and shall include an offer by the Borrower to prepay on the Prepayment Date the Tranche B Term Loans of such Lender by an amount equal to the portion of the Mandatory Prepayment Amount indicated in such Lenders Prepayment Option Notice as being applicable to such Lenders Tranche B Term Loans. The Prepayment Date in respect of any Prepayment Option Notice shall be the date which is the date which is five Business Days after the date of such Prepayment Option Notice.
(d) On the Prepayment Date, the Administrative Agent shall (A) apply the Mandatory Prepayment Amount toward prepayment of the outstanding Tranche B Term Loans in respect of which Lenders have accepted mandatory prepayment as described above and (B) return the remaining portion of the Mandatory Prepayment Amount not accepted by the Tranche B Term Loan Lenders to the Borrower; provided , that in the case of Net Cash Proceeds arising from the sale of Collateral returned to the Borrower pursuant to clause (B) above, either (x) the Borrower shall then apply such Net Cash Proceeds as a voluntary prepayment of the Tranche B Term Loan pursuant to Section 2.8.1(a) or (y) the Revolving Credit Commitments shall be permanently reduced by the amount of such Net Cash Proceeds.
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SECTION 2.9 . Interest Payments . Interest on all Loans shall accrue and be payable in accordance with this Section 2.9 .
SECTION 2.9.1 . Rates . From the date any Loan is made to the date the principal amount of such Loan is repaid in full, interest shall accrue on the outstanding principal amount of such Loan at a rate per annum :
(a) on that portion of the outstanding principal amount thereof maintained from time to time as a Base Rate Loan, equal to the Base Rate from time to time in effect, plus , in the case of any Revolving Loan, the then Applicable Base Rate Margin, and, in the case of any Tranche B Term Loan, 2.00%; and
(b) on that portion of the outstanding principal amount thereof maintained from time to time as a Eurodollar Rate Loan, during each Interest Period applicable thereto, equal to the sum of the Eurodollar Rate (Adjusted) for such Interest Period, plus , in the case of any Revolving Loan, the then Applicable Eurodollar Rate Margin, and, in the case of any Tranche B Term Loan, 3.00%.
SECTION 2.9.2 . Default Rate . If all or a portion of the principal amount of any Loan or Reimbursement Obligation shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement Obligations (whether or not overdue) (to the extent legally permitted) shall bear interest at a rate per annum that is equal to (x) in the case of the Loans, the rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this Section plus 2% or (y) in the case of Reimbursement Obligations, the rate applicable to Base Rate Loans under the Revolving Credit Facility plus 2% (the Default Rate ). If all or a portion of any interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to the Default Rate.
SECTION 2.9.3. Payment Dates . Interest accrued on each Loan shall be payable, without duplication:
(a) with respect to any Revolving Loans, on the Revolving Commitment Termination Date;
(b) with respect to any Tranche B Term Loan, on the date specified in Section 2.8.1 ;
(c) in the case of any Loan:
(i) on that portion of the outstanding principal amount thereof maintained as a Base Rate Loan, on the last day of each Fiscal Quarter, commencing with the first such day following the Closing Date;
(ii) on that portion of the outstanding principal amount thereof maintained as a Eurodollar Rate Loan, on the last day of each applicable Interest
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Period and, if such Interest Period shall exceed three months, on each day that occurs during such Interest Period every three months from the first day of such Interest Period (or, if there is no numerically corresponding day in such subsequent month or if such numerically corresponding day is not a Business Day, on the next preceding Business Day); and
(d) on that portion of any Loans the maturity of which is accelerated pursuant to Section 7.2 , immediately upon such acceleration.
Interest accrued on the principal amount of each Loan or other monetary Obligation arising under this Agreement or any other Loan Document after the date such amount is due and payable (whether on the Revolving Commitment Termination Date, upon acceleration or otherwise) shall be payable upon demand.
SECTION 2.9.4 . Rate Determinations .
(a) All determinations by the Administrative Agent of any rate of interest applicable to any Loan or other monetary Obligation shall be presumptive evidence of such rate.
(b) If the Administrative Agent shall have determined that for any reason adequate and reasonable means do not exist for ascertaining the IBO Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan or that the IBO Rate applicable pursuant to Section 2.9.1 for any requested Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to the Lenders of funding such Loan, the Administrative Agent will immediately give notice of such determination to the Borrower and each Lender. Thereafter, the obligation of the Lenders to make or continue Eurodollar Rate Loans hereunder, or permit the conversion of Base Rate Loans into Eurodollar Rate Loans, shall be suspended until the Administrative Agent revokes such notice in writing promptly after determining that the circumstances relating to its determination that adequate and reasonable means do not exist for ascertaining the IBO rate no longer exist and no new such circumstances have come into being. Upon receipt of such notice, the Borrower may revoke any Notice of Borrowing or Continuation/Conversion Notice then submitted by it; provided , however , that such revocation shall not cause the Borrower to be obligated to reimburse the Lenders for costs under Section 2.11 in connection with such revocation. If the Borrower does not revoke such notice, the Lenders shall make, convert or continue the Loans, as originally proposed by the Borrower, in the amount specified in the applicable notice submitted by the Borrower, but such Loans shall be made, converted or continued as Base Rate Loans.
(c) On the date on which the aggregate unpaid principal amount of Loans shall be reduced, by payment or prepayment or otherwise, to less than $1,000,000, such Loans shall, if they are Eurodollar Rate Loans, automatically convert into Base Rate Loans, and on and after such date the right of the Borrower to convert Base Rate Loans into Eurodollar Rate Loans shall terminate. The Borrower shall be obligated to reimburse
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the Lenders for costs incurred in connection with such automatic conversion in accordance with Section 2.11 .
SECTION 2.10 . Increased Costs and Reduction of Returns .
(a) If any Issuing Lender or any Lender shall determine that, due to either (i) the introduction of or any change (other than any change by way of imposition of or increase in reserve requirements included in the calculation of the IBO Rate) in or in the interpretation of any law or regulation occurring after the Closing Date (other than a change in tax law) or (ii) the compliance with any guideline or request (other than a guideline or request relating to taxes) issued after the Closing Date from any central bank or other Governmental Authority (whether or not having the force of law), there shall be any increase in the cost to (including a reduction in the sum receivable by) such Issuing Lender or such Lender of agreeing to make or making, funding, continuing or maintaining any of its Loans as, or converting (or its obligation to convert) any portion of the principal amount of any of its Loans into, Eurodollar Rate Loans, or issuing, maintaining or participating in any Letter of Credit, then the Borrower shall be liable for, and shall from time to time, within fifteen (15) days after written demand therefor by the Administrative Agent on behalf of such Issuing Lender or such Lender in the form of a certificate as to such amounts, showing a calculation of such amounts in reasonable detail, submitted to the Borrower and the Administrative Agent by such Issuing Lender or such Lender which certificate shall be presumptive evidence of such amounts (which demand the Administrative Agent hereby agrees to deliver), immediately pay to the Administrative Agent for the account of such Issuing Lender or such Lender, from time to time as specified by such Issuing Lender or such Lender, additional amounts as are sufficient to compensate such Issuing Lender or such Lender for such increased cost (including such reduced amount).
(b) If any Issuing Lender or any Lender shall have determined that (i) the introduction after the Closing Date of any Capital Adequacy Regulation, (ii) any change after the Closing Date in any Capital Adequacy Regulation, (iii) any change after the Closing Date in the interpretation or administration of any Capital Adequacy Regulation by any central bank or other Governmental Authority charged with the interpretation or administration thereof, or (iv) compliance by such Issuing Lender or such Lender (or its Applicable Lending Office) or any corporation controlling such Issuing Lender or such Lender, with any Capital Adequacy Regulation issued after the Closing Date, in any such case affects or would affect the amount of capital required or expected to be maintained by such Issuing Lender or such Lender or any corporation controlling such Issuing Lender or such Lender and (taking into consideration such Issuing Lenders or such Lenders or such corporations policies with respect to capital adequacy and such Issuing Lenders or such Lenders desired return on capital) determines that the amount of such capital is increased as a consequence of its commitment to issue, its issuance of or participation in any Letter of Credit or its Commitments, Loans, credits or obligations under this Agreement, then, within fifteen (15) days after written demand therefor by the Administrative Agent on behalf of such Issuing Lender or such Lender in the form of a certificate as to such amounts, showing a calculation of such amounts in reasonable detail, submitted to the Borrower and the
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Administrative Agent by such Issuing Lender or such Lender which certificate shall be presumptive evidence of such amounts (which demand the Administrative Agent hereby agrees to deliver), the Borrower shall pay to the Administrative Agent for the account of such Issuing Lender or such Lender, from time to time as specified by such Issuing Lender or such Lender, additional amounts as are sufficient to compensate such Issuing Lender or such Lender or such corporation for such increase.
(c) Without limiting the generality of clauses (a) and (b) of this Section 2.10 , in the event that any Issuing Lender, in compliance with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law) or any Capital Adequacy Regulation issued after the Closing Date, or as a result of any change after the Closing Date in the interpretation or administration of any such guideline or Capital Adequacy Regulation by any central bank or Governmental Authority charged with the interpretation or administration thereof, determines that a Performance Letter of Credit should have been characterized at the time of issuance thereof or should be recharacterized as a Financial Letter of Credit, then the Borrower shall be liable for, and shall from time to time, upon demand therefor by such Issuing Lender in the form of a certificate as to such amounts, showing a calculation of such amounts in reasonable detail, submitted to the Borrower and the Administrative Agent by such Issuing Lender, which certificate shall be presumptive evidence of such amounts (with a copy to the Administrative Agent), within fifteen (15) days after written demand therefor by the Administrative Agent on behalf of such Issuing Lender (which demand the Administrative Agent hereby agrees to deliver), pay to the Administrative Agent, for the account of such Issuing Lender, from time to time as specified by such Issuing Lender, such additional amounts as are sufficient to cause such Issuing Lender to receive Letter of Credit Fees under Section 3.3(a) from the date of issuance or recharacterization, as the case may be.
(d) Each Issuing Lender and each Lender agree to notify the Borrower and the Administrative Agent in writing promptly of any circumstances that would cause the Borrower to pay additional amounts pursuant to this Section 2.10 , provided that the failure to give such notice shall not affect the Borrowers obligation to pay such additional amounts hereunder. Notwithstanding anything to the contrary in this Section 2.10 , the Borrower shall have no obligation to pay any additional amounts under clause ( a) , (b) or (c) of this Section 2.10 unless the claiming Issuing Lender or Lender shall have made demand upon the Borrower for such additional amounts within six (6) months after the claiming Issuing Lender or Lender obtained knowledge of the circumstances that would cause the Borrower to pay such additional amounts; provided , however , that the foregoing limitation shall not apply to any such additional amounts arising out of the retroactive application of any law, regulation, rule guideline or directive within such six (6) month period. A Lender or Issuing Lender shall be deemed to have obtained knowledge of any circumstances that would cause the Borrower to pay such additional amounts if any rules with respect to such increase have been published in the Federal Register and such knowledge shall be deemed to have been obtained on the later of the date when such new rule (i) is published in the Federal Register and (ii) becomes effective. Without prejudice to the survival of any other agreement of the Borrower
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hereunder, the agreements and obligations of the Borrower in this Section 2.10 shall survive the payment of all other Obligations.
(e) If the Borrower is required to pay additional amounts to any Lender or the Administrative Agent pursuant to Section 2.10 , then such Lender shall use its reasonable best efforts (consistent with legal and regulatory restrictions) to take such actions (including, if applicable, to change the jurisdiction of its Applicable Lending Office) so as to minimize any such additional payment by the Borrower which may thereafter accrue if such change in the judgment of such Lender is not otherwise disadvantageous to such Lender.
SECTION 2.11 . Funding Losses . In the event any Lender shall incur any loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to make, continue or maintain any portion of the principal amount of any Loan as, or to convert any portion of the principal amount of any Loan into, a Eurodollar Rate Loan) as a result of:
(a) repayment or prepayment of the principal amount of any Eurodollar Rate Loans on a date other than the last day of the Interest Period applicable thereto, whether pursuant to Section 2.8 or otherwise, or the compulsory assignment of a Eurodollar Rate Loan of a Non-Consenting Lender pursuant to Section 9.1 ;
(b) any conversion of all or any portion of the outstanding principal amount of any Eurodollar Rate Loans to Base Rate Loans prior to the expiration of the Interest Period then applicable thereto;
(c) any Loans not being made as Eurodollar Rate Loans in accordance with the Notice of Borrowing therefor (except in the event of a revocation of a Notice of Borrowing pursuant to Section 2.9.4 (b) ); or
(d) any Loans not being continued as, or converted into, Eurodollar Rate Loans in accordance with the Continuation/Conversion Notice given therefor, then, upon the request by the Administrative Agent on behalf of such Lender in the form of a certificate as to such amounts, showing a calculation of such amounts in reasonable detail, submitted to the Borrower and the Administrative Agent by such Lender, which shall be presumptive evidence of such amounts (which request the Administrative Agent hereby agrees to deliver), the Borrower shall pay to the Administrative Agent for the account of such Lender such amount as will (in the reasonable determination of such Lender) reimburse such Lender for such loss or expense. Solely for purposes of calculating amounts payable by the Borrower to such Lenders under this Section 2.11 , each Eurodollar Rate Loan made by a Lender (and each related reserve, special deposit or similar requirement) shall be conclusively deemed to have been funded at the rate used in determining the IBO Rate for such Eurodollar Rate Loan by a matching deposit or other borrowing in the interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan is in fact so funded. Any claim by a Lender for reimbursement under this Section 2.11 shall be set forth in a certificate delivered by such Lender to the Borrower and the Administrative Agent
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showing in reasonable detail the basis for such calculation and shall be presumptive evidence of such amounts. The agreements and obligations of the Borrower in this Section 2.11 shall survive the payment of all other Obligations.
(e) If the Borrower is required to pay additional amounts to any Lender or the Administrative Agent pursuant to Section 2.11 , then such Lender shall use its reasonable best efforts (consistent with legal and regulatory restrictions) to take such actions (including, if applicable, to change the jurisdiction of its Applicable Lending Office) so as to minimize any such additional payment by the Borrower which may thereafter accrue if such change in the judgment of such Lender is not otherwise disadvantageous to such Lender.
SECTION 2.12 . Illegality .
(a) If any Lender shall determine that the introduction of any Applicable Law, or any change in any Applicable Law or in the interpretation or administration thereof, has made it unlawful, or that any central bank or other Governmental Authority has asserted that it is unlawful, for any Lender or its Applicable Lending Office to make Eurodollar Rate Loans, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, the obligation of that Lender to make, convert into or continue Eurodollar Rate Loans, shall be suspended until such Lender shall have notified the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist.
(b) If a Lender shall determine that it is unlawful to maintain any Eurodollar Rate Loan, the Borrower shall prepay in full all Eurodollar Rate Loans of that Lender then outstanding, together with interest accrued thereon, or convert such Eurodollar Rate Loans into Base Rate Loans, either on the last day of the Interest Period thereof if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, upon request therefor if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans until the last day of the Interest Period, together with any amounts required to be paid in connection therewith pursuant to Section 2.11 .
(c) If the Borrower is required to prepay any Eurodollar Rate Loan immediately as provided in Section 2.12(b) , then concurrently with such prepayment, the Borrower shall borrow from the affected Lender, in the amount of such repayment, a Base Rate Loan.
(d) If the obligation of any Lender to make or maintain Eurodollar Rate Loans has been terminated, the Borrower may elect, by giving notice to such Lender through the Administrative Agent that all Loans which would otherwise be made by such Lender as Eurodollar Rate Loans shall instead be Base Rate Loans.
(e) Before giving any notice to the Administrative Agent pursuant to this Section 2.12 , the affected Lender shall designate a different Eurodollar Office with respect to its Eurodollar Rate Loans if such designation will avoid the need for giving
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such notice or making such demand and will not, in the judgment of such Lender, be illegal or otherwise disadvantageous to such Lender.
(f) If the Borrower is required to pay additional amounts to any Lender or the Administrative Agent pursuant to Section 2.12 , then such Lender shall use its reasonable best efforts (consistent with legal and regulatory restrictions) to take such actions (including, if applicable, to change the jurisdiction of its Applicable Lending Office) so as to minimize any such additional payment by the Borrower which may thereafter accrue if such change in the judgment of such Lender is not otherwise disadvantageous to such Lender.
SECTION 2.13. Right of the Lenders to Fund through Other Offices . Each Lender may, if it so elects, fulfill its commitment as to any Eurodollar Rate Loan by causing a foreign branch or affiliate of such Lender to make such Loan; provided that in such event for the purposes of this Agreement such Loan shall be deemed to have been made by such Lender and the obligation of the Borrower to repay such Loan shall nevertheless be to such Lender and shall be deemed held by it, to the extent of such Loan, for the account of such branch or affiliate.
SECTION 2.14. Commitment Fee and Fee Obligations Generally .
(a) Commitment Fee . The Borrower agrees to pay to the Administrative Agent, for the account of each Lender, a commitment fee (the Commitment Fee ) in an amount equal to the product of (i) the Applicable Commitment Fee Percentage multiplied by (ii) the daily average amount by which the Revolving Commitment Amount exceeds the sum of the outstanding principal balance of the Revolving Loans plus the then Letter of Credit Obligations, for the period from the Closing Date until the Revolving Commitment Termination Date. The Commitment Fee shall be payable quarterly in arrears on the last day of each Fiscal Quarter for the Fiscal Quarter then ended and on the Revolving Commitment Termination Date. Solely for purposes of calculating the Commitment Fee under this Section 2.14(a) , the equivalent in Dollars of the undrawn face amount of each Letter of Credit made in an Alternative Currency shall be determined on the date of issuance of such Letter of Credit and shall be redetermined as of the last Business Day of each calendar month thereafter during which such Letter of Credit remains outstanding, with no interim adjustments with respect to any fluctuations in the value of such Alternative Currency.
(b) Other Fees . The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates from time to time agreed to in writing by the Borrower and the Administrative Agent.
(c) Fee Obligations . The obligation of the Borrower to pay the fees described in this Section 2.14 , and the Letter of Credit Fees described in Section 3.3 , shall be in addition to, and not in lieu of, the obligation of the Borrower to pay interest and expenses and other amounts otherwise described in this Agreement. The fees described in this Section 2.14 shall be fully earned on the earlier of the date paid or
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accrued and shall be non-refundable. The Letter of Credit Fees and the fees described in this Section 2.14 shall bear interest, if not paid when due, at the Default Rate.
SECTION 2.15 . Payments and Computations .
(a) Allocation . All payments by the Borrower pursuant to this Agreement or any other Loan Document, whether in respect of principal of or interest on Loans or other Obligations, shall be made by the Borrower in Dollars no later than 1:00 P.M. (Chicago time) on the day when due to the Administrative Agent in same day funds. All payments in respect of principal of or interest on Loans or Letter of Credit Obligations shall (unless otherwise specified herein) be made by the Borrower to the Administrative Agent for the account of the Lenders pro rata according to the respective unpaid principal amounts of the Loans made by them or to their respective participation or other interests in such Letter of Credit Obligations, as the case may be. The payment of all fees referred to in Section 2.14 and Section 3.3 shall (unless otherwise specified therein) be made by the Borrower to the Administrative Agent for the account of the Lenders entitled thereto. All other amounts payable to the Administrative Agent or any Lender under this Agreement or any other Loan Document shall be paid to the Administrative Agent for the account of the Person entitled thereto. Upon its acceptance of an Assignment and Acceptance and recording of the information contained therein in the Register pursuant to Section 9.7(d) , from and after the effective date specified in such Assignment and Acceptance, the Administrative Agent shall make all payments hereunder in respect of the interest assigned thereby to the Lender assignee thereunder, and the parties to such Assignment and Acceptance shall make all appropriate adjustments in such payments for periods prior to such effective date directly between themselves. The Administrative Agent shall promptly remit to each Lender in immediately available funds and in Dollars such Lenders share of all such payments received by the Administrative Agent for the account of such Lender.
(b) All computations of interest or fees hereunder or under any other Loan Document shall be made by the Administrative Agent on the basis of a year of 360 days, except that, with respect to Base Rate Loans (other than Base Rate Loans with respect to which the rate of interest is calculated on the basis of the Federal Funds Rate), the interest thereon shall be calculated on the basis of a year of 365 or 366 days, as the case may be, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest or fees are payable. Each determination by the Administrative Agent of an interest rate hereunder shall be conclusive and binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or fees, as the case may be; provided if such extension would cause payment of interest on or principal of Eurodollar Rate Loans to be made in the next following calendar month, such payment shall be made on the next preceding Business Day.
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(d) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Lenders hereunder that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent that the Borrower shall not have so made such payment in full to the Administrative Agent, each Lender shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Federal Funds Rate.
(e) All payments of principal, interest, fees and all expenses and other amounts due hereunder or under any other Loan Document payable to the Lenders shall be made without condition and in same day funds and delivered to the Administrative Agent on the date thereof not later than the applicable cut-off time described in Section 2.15(a) , and funds received by the Administrative Agent after that time shall be deemed to have been paid on the next succeeding Business Day.
(f) Subject to the provisions of Section 2.8.2 , each payment of principal shall be applied to such Loans as the Borrower shall direct by notice received by the Administrative Agent on or before the date of such payment or, in the absence of such notice, first, to the unpaid principal amount of any outstanding Base Rate Loans, second, to the unpaid principal amount of any outstanding Eurodollar Rate Loans with those Eurodollar Rate Loans which have earlier expiring Interest Periods being repaid prior to those which have later expiring Interest Periods, and then as the Administrative Agent shall determine in its discretion. Concurrently with each remittance to any Lender of its share of any such payment, the Administrative Agent shall advise such Lender as to the application of such payment.
SECTION 2.16 . Taxes .
(a) Subject to Section 2.16(d) , any and all payments by the Borrower to each Lender or the Administrative Agent under this Agreement shall be made free and clear of, and without, unless required by Applicable Law (in which case Section 2.16(d ) shall apply), deduction or withholding for, any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Lender and the Administrative Agent, such taxes (including income taxes or franchise taxes) as are imposed on or measured by each Persons net income (including branch profits taxes), and franchise taxes are imposed on it by the jurisdiction under the laws of which such Lender or the Administrative Agent, as the case may be, is organized or maintains any Applicable Lending Office or any political subdivision of the foregoing (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as Taxes ).
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(b) In addition, the Borrower shall pay any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies which arise from any payment made hereunder or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or any other Loan Documents other than amounts as are being contested in good faith (hereinafter referred to as Other Taxes ).
(c) Subject to Section 2.16(g) , the Borrower shall indemnify and hold harmless each Lender and the Administrative Agent for the full amount of Taxes or Other Taxes paid by Lender or the Administrative Agent as a result of its Commitment, any Loans made by it hereunder, or otherwise in connection with its participation in this Agreement and any liability (including penalties, interest, additions to tax and expenses) arising therefrom or with respect thereto (other than liability resulting from the gross negligence, bad faith or willful misconduct of such Lender or the Administrative Agent), whether or not such Taxes or Other Taxes were correctly or legally asserted. Payment under this indemnification shall be made within thirty (30) days from the date Lender or the Administrative Agent makes written demand therefor in the form of a certificate as to such amounts, showing a calculation of such amounts in reasonable detail, submitted to the Borrower and the Administrative Agent by such Lender, which shall be presumptive evidence of such amounts, which written demand shall be made no sooner than thirty (30) days prior to the date Lender intends to pay such Taxes or Other Taxes and no later than ninety (90) days after such payment.
(d) If the Borrower shall be required by law to deduct or withhold any Taxes or Other Taxes from or in respect of any sum payable hereunder to any Lender or the Administrative Agent, then, subject to Section 2.16(g) :
(i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 2.16 ) such Lender or the Administrative Agent, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made;
(ii) the Borrower shall make such deductions; and
(iii) the Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable law.
(e) Within thirty (30) days after the date of any payment by the Borrower of Taxes or Other Taxes, the Borrower shall furnish to the Administrative Agent the original or a certified copy of a receipt evidencing payment thereof, or other evidence of payment reasonably satisfactory to the Administrative Agent.
(f) Each Lender other than a Lender which is (1) a U.S. person (within the meaning of IRC Section 7701(a)(30)) and (2) treated as a corporation for U.S. federal income tax purposes agrees that:
(i) it shall, no later than the Closing Date (or, in the case of a Lender which becomes a party hereto pursuant to Section 9.7 after the Closing
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Date, the date upon which Lender becomes a party hereto) deliver to the Borrower through the Administrative Agent two accurate and complete signed originals of IRS Form W-9, Form W-8BEN or W-8 ECI or any successor thereto, in each case ( Withholding Forms ) indicating that the Lender is on the date of delivery thereof exempt from United States withholding tax and entitled to receive payments under this Agreement free from withholding of United States Federal income tax;
(ii) if at any time the Lender makes any changes necessitating a new Withholding Form, it shall with reasonable promptness deliver to the Borrower through the Administrative Agent in replacement for, or in addition to, the forms previously delivered by it hereunder, two accurate and complete signed originals of Withholding Forms indicating that the Lender is on the date of delivery thereof exempt from United States withholding tax and entitled to receive all payments under this Agreement free from withholding of United States Federal income tax;
(iii) it shall, before or promptly after the occurrence of any event (including the passing of time but excluding any event mentioned in clause (ii) above) requiring a change in or renewal of the most recent Withholding Forms previously delivered by such Lender, deliver to the Borrower through the Administrative Agent two accurate and complete original signed copies of Withholding Forms in replacement for the forms previously delivered by the Lender; and
(iv) it shall, promptly upon the Borrowers or the Administrative Agents reasonable request to that effect, deliver to the Borrower or the Administrative Agent (as the case may be) such other forms or similar documentation as may be required from time to time by any applicable law, treaty, rule or regulation in order to establish such Lenders tax status for withholding purposes.
(g) The Borrower will not be required to pay any amounts in respect of United States Federal income tax pursuant to Section 2.16(c) or Section 2.16(d) to any Lender for the account of any Applicable Lending Office of such Lender:
(i) if the obligation to pay such additional amounts would not have arisen but for a failure by such Lender to comply with its obligations under Section 2.16(f) in respect of such Applicable Lending Office;
(ii) if such Lender shall have delivered to the Borrower a Withholding Form in respect of such Applicable Lending Office pursuant to Section 2.16(f) , and such Lender shall not at any time be entitled to exemption from deduction or withholding of United States Federal income tax in respect of payments by the Borrower hereunder for the account of such Applicable Lending Office for any reason other than a change in United States law or regulations or in the official interpretation of such law or regulations by any governmental
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authority charged with the interpretation or administration thereof (whether or not having the force of law) after the date of delivery of such Withholding Form; or
(iii) if the Lender shall have delivered to the Borrower a Withholding Form in respect of such Applicable Lending Office pursuant to Section 2.16(f) , and such Lender shall not at any time be entitled to exemption from deduction or withholding of United States Federal income tax in respect of payments by the Borrower hereunder for the account of such Applicable Lending Office for any reason other than a change in United States law or regulations or any applicable tax treaty or regulations or in the official interpretation of any such law, treaty or regulations by any governmental authority charged with the interpretation or administration thereof (whether or not having the force of law) after the date of delivery of such Withholding Form.
(h) If the Borrower is required to pay additional amounts to any Lender or the Administrative Agent pursuant to Section 2.16(d) , then such Lender shall use its reasonable best efforts (consistent with legal and regulatory restrictions) (including changing the jurisdiction of its Applicable Lending Office) so as to eliminate any such additional payment by the Borrower which may thereafter accrue if such change in the judgment of such Lender is not otherwise disadvantageous to such Lender.
(i) If the Administrative Agent or any Lender determines that it has received a refund or direct credit in respect of and specifically associated with any Taxes or Other Taxes as to which it has been indemnified by the Borrower, or with respect to which the Borrower has paid additional amounts, it shall promptly notify the Borrower of such refund or direct credit and shall within 30 days from the date of receipt of such refund or benefit of such direct credit (including any interest paid or credited by the relevant Governmental Authority attributable to such refund or direct credit) to the Borrower but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower with respect to the Taxes or Other Taxes giving rise to such refund or direct credit net of all out-of-pocket expenses of such Person.
(j) Without prejudice to the survival of any other agreement of the Borrower, the Lenders and the Administrative Agent hereunder, the agreements and obligations of the Borrower, the Lenders and the Administrative Agent contained in this Section 2.16 shall survive the payment of all other Obligations.
SECTION 2.17 . Sharing of Payments, Etc . If any Lender shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise, but not including any payment made from an assigning Lender to an assignee Lender or a Lender to a Participant on account of an assignment of Loans or Participation) on account of the Loans or the Letters of Credit (other than pursuant to Section 2.10 , 2.11 , 2.12(b) , 2.16 or 3.3(b) ) in excess of its ratable share of payments on account of such Loans and/or the Letters of Credit obtained by all the Lenders entitled thereto, such Lender shall forthwith purchase from the other Lenders notified of such payment such participations in such Loans and/or Letters of Credit made by them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with
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each of them; provided that if all or any portion of such excess payment is thereafter recovered from the purchasing Lender, such purchase from each such Lender shall be rescinded and each such Lender shall repay to the purchasing Lender the purchase price to the extent of such recovery together with an amount equal to such Lenders ratable share (according to the proportion of (a) the amount of such Lenders required repayment to (b) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered. The Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 2.17 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation.
SECTION 2.18 . Warranty . Each Notice of Borrowing pursuant to Section 2.4 and the delivery of each Letter of Credit Request pursuant to Section 3.2 , shall automatically constitute a warranty by the Borrower to the Administrative Agent and each Lender to the effect that on the date of such requested Borrowing or the issuance of the requested Letter of Credit, as the case may be, (a) the warranties contained in the Loan Documents (except to the extent changes in facts or conditions are expressly permitted or required hereunder or thereunder) shall be true and correct in all material respects as of such requested date as though made on the date thereof unless an earlier date is so specified in such representation and warranty and (b) no Event of Default or Default shall have then occurred and be continuing or will result therefrom.
SECTION 2.19 . Conditions . Notwithstanding any other provision of this Agreement (other than as set forth in Section 3.4 ), (a) no Lender shall be obligated to make any Loan, (b) no Lender shall be obligated to convert into or permit the continuation at the end of the applicable Interest Period of any Eurodollar Rate Loan, and (c) no Issuing Lender shall be obligated to issue any Letter of Credit if, in any such case, an Event of Default or Default exists or would result therefrom.
SECTION 2.20 . All Obligations Secured . The Loans, the Reimbursement Obligations, and all other Obligations of the Borrower and each other Person to the Administrative Agent, any Issuing Lender, any Lender or any other Secured Party, shall be secured by the Administrative Agents Lien, for the benefit of the Secured Parties, on all of the Collateral and by all other Liens heretofore, now, or at any time or times hereafter granted by the Borrower or any other Person to the Administrative Agent, any Issuing Lender, any Lender or any other Secured Party to secure any Obligations. The Borrower agrees that all of the rights of the Secured Parties set forth in this Agreement shall apply to any modification, amendment or restatement of, or supplement to, this Agreement, any supplements or exhibits hereto, and the other Loan Documents, unless otherwise agreed in writing.
SECTION 2.21 . Use of Proceeds . The Borrower shall apply the proceeds of the Revolving Loans and the Tranche B Term Loans to (a) to the general corporate purposes of the Borrower and its Subsidiaries, (b) the financing of the Acquisition, (c) the
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payment of fees and expenses related to the Acquisition and (d) the refinancing of the Debt in respect of the NASDI Acquisition Note and the Existing Credit Agreement.
SECTION 2.22 . Assignment of Commitments Under Certain Circumstances . In the event that the Administrative Agent shall have delivered a notice or certificate on behalf of any Lender pursuant to Section 2.10 , 2.12 or 2.16 , the Loan Parties shall be required to make additional payments to any Lender under Section 2.16 , or any Lender shall become a Defaulting Lender, the Borrower shall have the right, at its own expense, upon notice to such Lender and Administrative Agent, not later than sixty (60) days following such Lenders delivery of such notice or certificate, to require such Lender or Defaulting Lender to transfer and assign, without recourse or discount, in accordance with and subject to the restrictions contained in Section 9.7 , all of its interests, rights and obligations under this Agreement (including, without limitation, its Commitments and its Percentage of the Obligations) to one or more financial institutions chosen by the Borrower (and approved by the Administrative Agent and the Issuing Bank, which approval shall not be unreasonably withheld) which have agreed to so acquire and assume such interests, rights and obligations. A Lender shall not be required to make any such transfer and assignment unless all Obligations owing to such Lender, including, without limitation, those arising under Sections 2.10 , 2.12 and 2.16 , have been paid in full and such Lender shall have no further obligations with respect to its Commitments, and no Lender shall be required to make any such transfer and assignment if prior thereto the circumstances entitling the Borrower to require such a transfer and assignment cease to apply as a result of such Lenders withdrawing its notice or certificate pursuant to Section 2.10 , 2.12 or 2.16 , as applicable.
ARTICLE III
.
LETTERS OF CREDIT
SECTION 3.1 . Commitment for Letters of Credit . Prior to the Closing Date, Bank of America, as Issuing Lender under the Existing Credit Agreement has issued the Existing L/Cs, which from and after the Closing Date, shall constitute Letters of Credit hereunder. Subject to the terms and conditions hereof, each Issuing Lender hereunder, in reliance on the agreements of the other Revolving Lenders, set forth in Section 3.4 , agrees to issue letters of credit (the letters of credit issued on and after the Closing Date pursuant to this Section 3 together with the Existing L/Cs, the Letters of Credit ) in Dollars or in Alternative Currencies for the account of the Borrower, and each Lender severally agrees to participate in the Letters of Credit (including Existing L/Cs) issued by each Issuing Lender hereunder, in a Dollar equivalent amount equal to such Lenders Revolving Credit Percentage, from time to time, on any Business Day during the period commencing on the date hereof, and continuing until the Revolving Commitment Termination Date in such form as may be approved from time to time by the applicable Issuing Lender; provided , that no Issuing Lender shall have any obligation to issue any Letter of Credit if, after giving effect to such issuance, (i) the Letter of Credit Obligations would exceed the Letter of Credit Availability or (ii) the aggregate amount of Available Revolving Commitments would be less than zero. Each Letter of Credit shall expire no later than the earlier of (x) the fourth anniversary of its date of issuance and (y) the date which is prior to the Revolving Commitment Termination Date as in effect at the
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time of the issuance of the Letter of Credit; provided that any Letter of Credit with a one-year term may provide for renewal thereof for additional one-year periods (which shall in no event extend beyond the date referred to in clause (y) above).
SECTION 3.2. Issuance of Letters of Credit .
(a) The Borrower shall give the applicable Issuing Lender prior written notice (a Letter of Credit Request ) not later than 11:00 A.M. (Chicago time) on the Business Day immediately preceding the date on which the issuance or amendment of a Letter of Credit is requested or, in the case of a requested Letter of Credit to be denominated in an Alternative Currency, on the Business Day immediately preceding the date on which the issuance or amendment of such a Letter of Credit requested (or, in either case, such shorter time if consented to by the Administrative Agent and such Issuing Lender), specifying:
(i) the requested date for issuance or amendment of such Letter of Credit, which shall be a Business Day;
(ii) the expiry date of such Letter of Credit, which shall be a Business Day;
(iii) the beneficiary of such Letter of Credit;
(iv) the aggregate face amount of such Letter of Credit and the requested currency in which such Letter of Credit is to be denominated;
(v) whether the Letter of Credit to be issued is a Financial Letter of Credit or a Performance Letter of Credit; and
(vi) the conditions for drawing to be included in such Letter of Credit.
Each such Letter of Credit Request shall be by telecopier, telex or cable, confirmed immediately in writing by mail, in substantially the form of Exhibit D and executed by an authorized officer of the Borrower.
(b) Upon receipt of a Letter of Credit Request, the applicable Issuing Lender shall promptly send a copy thereof to the Administrative Agent who shall then notify each Lender of the contents thereof. Upon satisfaction of the conditions precedent specified in Article IV hereof, and subject to the provisions of Section 3.2(c) , such Issuing Lender shall issue the Letter of Credit requested to be issued by it or amend the Letter of Credit requested to be amended, as the case may be, on the date specified in the Letter of Credit Request; provided that no Issuing Lender shall issue or maintain a Letter of Credit having an expiry date later than the date specified in Section 3.1 . Promptly after the issuance by an Issuing Lender of a Letter of Credit, such Issuing Lender shall furnish a copy of such Letter of Credit to the Administrative Agent and the Borrower.
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(c) In the case of a requested Letter of Credit to be denominated in an Alternative Currency, the obligation of the applicable Issuing Lender to issue such Letter of Credit is subject to the confirmation by such Issuing Lender to the Administrative Agent on the Business Day of the requested date of such issuance that such Issuing Lender agrees to issue such Letter of Credit in the requested Alternative Currency, which confirmation shall be promptly forwarded by the Administrative Agent to the Borrower. If such Issuing Lender shall not have so provided to the Administrative Agent such confirmation, the Administrative Agent shall promptly notify the Borrower that such Issuing Lender has not provided such confirmation, and the Borrowers request for such Letter of Credit in such Alternative Currency shall be deemed to have been thereupon withdrawn by the Borrower.
SECTION 3.3 . Letter of Credit Fee . The Borrower agrees to pay to the Administrative Agent (a) ratably for the account of each Lender, a letter of credit fee for the term of such Letter of Credit at the rate equal to the aggregate face amount outstanding of such Letter of Credit multiplied by (i) in the case of Performance Letters of Credit, subject to Section 2.10(c), the then Applicable Performance Letter of Credit Fee Percentage and (ii) in the case of Financial Letters of Credit, the then Applicable Financial Letter of Credit Fee Percentage, and (b) for the applicable Issuing Lenders own account (in addition to its Percentage of the fee payable to it as a Lender, in accordance with clause (a) above), a letter of credit fee for the term of such Letter of Credit .125 of 1% per annum (or such lower amount if agreed to by the applicable Issuing Lender) based upon the aggregate face amount outstanding of each such Letter of Credit and the applicable Issuing Lenders customary processing fees for the issuance, amendment or renewal of the Letter of Credit. The fee for any Letter of Credit issued by any Issuing Lender hereunder, as determined in accordance with clauses (a) and (b) above (the Letter of Credit Fee), shall be payable quarterly in arrears on the last day of each Fiscal Quarter, on the Revolving Commitment Termination Date and on the earliest of the cancellation, expiration or return of such Letter of Credit to the applicable Issuing Lender; provided that if any Letter of Credit is canceled and/or returned to the applicable Issuing Lender prior to the expiration thereof, the Borrower shall from time to time, upon demand by such Issuing Lender and/or any Lender therefor, immediately pay to such Issuing Lender and/or such Lender additional amounts sufficient to compensate it for its expenses not covered by a previously received Letter of Credit Fee. A certificate as to the amount of such expenses submitted to the Borrower and the Administrative Agent by such Issuing Lender and/or such Lender, showing in reasonable detail the calculation thereof, shall be presumptive evidence of such amount.
SECTION 3.4. Obligations of the Lenders to an Issuing Lender under a Letter of Credit . Each Issuing Lender will notify the Administrative Agent, and the Administrative Agent will thereupon notify each other Lender, promptly upon presentation to it of a draft for payment drawn under, or purporting to be drawn under, a Letter of Credit issued by it; provided that the Administrative Agent and each Lender shall have received notice by 2:00 P.M. (Chicago time) on the Business Day on which such Issuing Lender intends to make payment of each such draft, to the extent that the Borrower fails to provide funds therefor, each other Lender shall make payment to the applicable Issuing Lender in immediately available funds and in Dollars at the applicable
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Issuing Lenders Domestic Lending Office of an amount equal to the Dollar equivalent amount of such Issuing Lenders payment multiplied by such other Lenders Revolving Credit Percentage. The obligation of each Lender to make payments to each Issuing Lender under this Section 3.4 shall be unconditional, continuing, irrevocable and absolute regardless of whether or not any of the conditions set forth in Article IV are then satisfied. In the event that any Lender fails to make payment to any Issuing Lender of any amount due under this Section 3.4 , such Issuing Lender shall be entitled to receive the principal and interest otherwise payable to such Lender hereunder with respect to such amount until such Issuing Lender receives such payment from such Lender; provided that nothing contained in this sentence shall relieve such Lender of its obligation to make payment to any Issuing Lender for such amounts in accordance with this Section 3.4 .
SECTION 3.5 . Reimbursement Obligation . The Borrower agrees unconditionally and irrevocably to pay to the Administrative Agent in Dollars and in immediately available funds for the account of the applicable Issuing Lender (and, to the extent such payments were made by the Lenders pursuant to Section 3.4 , for the account of such Lenders), upon demand therefor by the Administrative Agent (which demand the Administrative Agent hereby agrees to deliver), the Dollar equivalent amount of each payment which is drawn under a Letter of Credit, or which purports to be so drawn (such obligation of the Borrower being referred to herein as a Reimbursement Obligation with respect to such Letter of Credit). If at any time the Borrower fails immediately to repay a Reimbursement Obligation pursuant to this Section 3.5 , the Borrower shall be deemed to have requested a Revolving Loan which is a Base Rate Loan, as of the date of the payment giving rise to the Reimbursement Obligation, from each Lender, equal in amount to such Lenders Revolving Credit Percentage multiplied by the Dollar equivalent amount of the unpaid Reimbursement Obligation, the proceeds of which shall be used to repay such Reimbursement Obligation. If, as a result of a Default or an Event of Default, a Revolving Loan may not be made on a date on which such Loan would be deemed to have been requested pursuant to the preceding sentence, the unpaid Dollar equivalent amount of the Reimbursement Obligation shall bear interest at the Default Rate and shall be payable on demand. Regardless of the expiration date of any Letter of Credit, the Borrower shall remain liable with respect to each Letter of Credit and all letter of credit fees shall continue to accrue, until the applicable Issuing Lender is released from liability by every Person which is entitled to draw or demand payment under such Letter of Credit.
SECTION 3.6. Representatives of Beneficiaries . Each Issuing Lender may receive, accept or pay as complying with the terms of such Letter of Credit, any drafts or other documents, otherwise in order, which may be signed by, or issued to, the administrator or executor of, or the trustee in bankruptcy of, or the receiver for any of the property of, the party in whose name such Letter of Credit provides that any drafts or other document should be drawn or issued.
SECTION 3.7 . Responsibility of the Administrative Agent, the Issuing Lenders and the Lenders . None of the Administrative Agent, any Issuing Lender or any Lender shall be liable or responsible for:
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(a) the use which may be made of the Letters of Credit or for any acts or omissions of the beneficiary(ies) in connection therewith;
(b) the validity, sufficiency or genuineness of documents, or of any endorsement(s) thereon, even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent or forged;
(c) failure of any draft to bear any reference or adequate reference to a Letter of Credit, or failure of documents to accompany any draft at negotiation, or failure of any Person to surrender or to take up a Letter of Credit or to send forward documents, apart from drafts required by the terms of the relevant Letter of Credit, each of which provisions, if contained in such Letter of Credit itself, it is agreed may be waived by the applicable Issuing Lender;
(d) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, wireless, or otherwise, whether or not they may be in cipher; or
(e) any other circumstances whatsoever in making or failing to make payment under a Letter of Credit;
except only that the Borrower shall have a claim against an Issuing Lender, and such Issuing Lender shall be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential, damages suffered by the Borrower which are determined to be caused by (i) such Issuing Lenders willful misconduct, bad faith or gross negligence or (ii) such Issuing Lenders willful or grossly negligent failure to pay under the relevant Letter of Credit after the presentation to such Issuing Lender by the relevant beneficiary of such Letter of Credit of a sight draft and certificate strictly complying with the terms and conditions of such Letter of Credit.
The happening of any one or more of the contingencies referred to in subparagraphs (a) , (b) , (c) , (d) or (e) above shall not affect, impair or prevent the vesting of any of the rights or powers of the Issuing Lenders, the Lenders or the Administrative Agent hereunder. In furtherance and extension and not in limitation of the specific provisions hereinbefore set forth, it is hereby further agreed that any action, inaction or omission taken or suffered by the Administrative Agent, any Issuing Lender or any Lender, under or in connection with a Letter of Credit or the relative drafts, documents or assets, if in conformity with such foreign or domestic laws, customs or regulations as are applicable thereto and without willful misconduct, bad faith or gross negligence, shall be binding upon the Borrower and shall not place the Administrative Agent, any Issuing Lender or any Lender under any resulting liability to the Borrower. The word assets as used in this Section 3.7 includes goods and merchandise, as well as any and all documents relative thereto, securities, funds, choses in action, and any and all other forms of property, whether real, personal or mixed and any right or interest of the Borrower therein or thereto.
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SECTION 3.8. Modifications to Letters of Credit . In the event of any change or modification with respect to (a) the amount or duration of any Letter of Credit, (b) the drawing, negotiation, presentation, acceptance, or maturity of any drafts, acceptances or other documents, or (c) any of the other terms or provisions of any Letter of Credit, such being done at the request of the Borrower, this Agreement shall be binding upon the Borrower in all respects with regard to the Letter of Credit so changed or modified, inclusive of any action taken by the applicable Issuing Lender or any Lender with respect to such Letter of Credit.
SECTION 3.9. Uniform Customs and Practice for Documentary Credits . Except as otherwise expressly provided in this Agreement or as the Borrower and the Lenders may otherwise expressly agree with regard to, and prior to the issuance of, a Letter of Credit, the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500, as hereafter amended, revised, supplemented, or replaced by other publication of similar effect, shall in all respects be deemed a part hereof as fully as if incorporated herein and shall apply to such Letter of Credit.
SECTION 3.10 . Indemnification . The Borrower hereby agrees to indemnify and hold harmless the Administrative Agent, each Issuing Lender and each Lender from and against any and all claims, damages, losses, liabilities, and reasonable out-of-pocket costs or expenses whatsoever (in each case, excluding loss of anticipated profits) which the Administrative Agent, an Issuing Lender or a Lender may incur (or which may be claimed against the Administrative Agent, an Issuing Lender or a Lender by any Person) by reason of or in connection with the execution and delivery or transfer of, or payment or failure to pay under, any Letter of Credit; provided that the Borrower shall not be required to indemnify any Issuing Lender for any claims, damages, losses, liabilities, costs or expenses to the extent, but only to the extent, caused by the willful misconduct, bad faith or gross negligence of such Issuing Lender, the Administrative Agent or any Lender. Nothing in this Section 3.10 is intended to limit the reimbursement obligation of the Borrower contained in Section 3.5 hereof.
SECTION 3.11 . Transitional Provisions . The Borrower, Bank of America, as Administrative Agent, and the Existing Lenders are currently parties to the Existing Credit Agreement pursuant to which, among other things, Bank of America, as Issuing Lender thereunder issued certain Letters of Credit (as defined therein) for the account of the Borrower (to the extent outstanding on the Closing Date and set forth on Schedule II , the Existing L/Cs ). Each of the Existing L/Cs shall remain outstanding and constitute Letters of Credit issued by an Issuing Lender for the account of the Borrower pursuant to this Agreement on the Closing Date for all purposes under this Agreement and any other Loan Document, including, for the purpose of the accrual and payment of Letter of Credit Fees payable pursuant to Section 3.3 for the remaining term of such Existing L/Cs (other than for customary processing fees for the issuance, amendment or renewal of such Existing L/Cs occurring prior to the Closing Date or relating to the deemed issuance thereof occurring on the Closing Date). All Reimbursement Obligations and other Letter of Credit Obligations (as respectively defined in the Existing Credit Agreement) which remain outstanding on the Closing Date
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with respect to the Existing L/Cs shall constitute Reimbursement Obligations and Letter of Credit Obligations of the Borrower under this Agreement and shall be included in the calculations of Availability and Letter of Credit Availability. Schedule II sets forth, as of the date hereof, the aggregate outstanding face amount, identifying number, expiry date and name of the beneficiary, with respect to each Existing L/Cs.
SECTION 3.12. Currency Equivalents . For all purposes of this Agreement, (i) the equivalent in Dollars of any Alternative Currency shall be determined by using the quoted spot rate at which the applicable Issuing Lender (or its Affiliate) offers to exchange Dollars for such Alternative Currency two Business Days prior to the date on which such equivalent is to be determined and (ii) the equivalent in any Alternative Currency of Dollars shall be determined by using the quoted spot rate at which the applicable Issuing Lender (or its Affiliate) offers to exchange such Alternative Currency for Dollars two Business Days prior to the date on which such equivalent is to be determined. Except as specified in Section 2.14(a) , the equivalent in Dollars of each Letter of Credit made in an Alternative Currency shall be recalculated hereunder on each date that it shall be necessary or desirable by any party to determine the amount of the Availability, the Letter of Credit Availability, the Letter of Credit Obligations, the Reimbursement Obligations, the Obligations or the face amount of any Letter of Credit on such date. Upon the request by any party hereto, the applicable Issuing Lender shall promptly make such determination and notify such requesting party of such determination.
ARTICLE IV
.
CONDITIONS OF LENDING
SECTION 4.1 . Conditions Precedent to Initial Borrowing and Initial Issuance of Letters of Credit . The obligation of each Lender on the Closing Date to make the Loans requested to be made by it and the agreement of the Issuing Lenders to issue the initial Letters of Credit to be issued or deemed issued on the Closing Date shall be subject to the satisfaction of each of the following conditions precedent set forth in this Section 4.1 :
(a) Delivery of Documents . The Administrative Agent shall have received counterparts of this Agreement and all other agreements, documents and instruments described in the List of Closing Documents attached hereto as Schedule IV (including legal opinions from counsel to the Loan Parties substantially in the forms attached hereto as Exhibits F-1 and F-2 , and the Loan Parties hereby direct their counsel to prepare and deliver the same to the Secured Parties), each duly executed, completed and acknowledged where appropriate and in form and substance reasonably satisfactory to the Lenders and in sufficient copies for each of the Lenders.
(b) Financial Statements; Business Plan . The Administrative Agent shall have received (i) the financial statements described in Section 5.1(f) and (ii) a satisfactory business plan for Fiscal Years 2003-2008. It is understood that (i) any projections, budget or business plan furnished to the Administrative Agent or any Lender are subject to significant uncertainties and contingencies, which are beyond the control of
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Holdings and its Subsidiaries, (ii) no assurance is given by Holdings and its Subsidiaries that such projections, budget or business plans will be realized, and (iii) the actual results may differ from such projections and such differences may be material. Such financial statements shall show Adjusted Consolidated EBITDA of the Borrower and its Subsidiaries for the twelve-month period ended September 30, 2003 of not less than $59,000,000.
(c) Lender Tax Forms . The Administrative Agent shall have received from each Lender required under Section 2.16 to deliver any Withholding Form, two executed copies of the appropriate Withholding Forms or such other forms or documents (or successor forms or documents) appropriately completed, as may be applicable to establish the extent, if any, to which payments to such Lender pursuant to this Agreement are exempt from withholding or deduction of Taxes imposed by the United States government.
(d) Certification of Debt to Adjusted Consolidated EBITDA . The Lenders shall have received a certificate of the chief financial officer of the Borrower certifying on behalf of the Borrower that the ratio of Debt of the Borrower and its Subsidiaries as of the Closing Date to Adjusted Consolidated EBITDA of the Borrower and its Subsidiaries for the twelve month period ended September 30, 2003 does not exceed 4.25 to 1.0, after giving effect to the Transactions and the other transactions contemplated hereby.
(e) Solvency Certificate . The Administrative Agent shall have received a solvency certificate from the chief financial officer of the Borrower certifying on behalf of the Borrower that the Borrower and its Subsidiaries on a consolidated basis, after giving effect to the Transactions and the other transactions contemplated hereby, are Solvent.
(f) Other Documents . The Administrative Agent shall have received such other approvals, opinions or documents as the Administrative Agent or any Lender may reasonably request.
(g) Satisfactory Legal Form . All documents executed or submitted pursuant hereto by or on behalf of the Borrower or any of its Subsidiaries or any other Loan Party shall be in form and substance reasonably satisfactory to the Administrative Agent and its counsel; the Administrative Agent and its counsel shall have received all information, approvals, opinions, documents or instruments as the Administrative Agent or its counsel may reasonably request.
(h) Evidence and Perfection of Liens; Allocation of Collateral . The Administrative Agent shall have received (i) such documents, filings, recordings, or searches as the Administrative Agent may reasonably request to evidence and perfect all Liens granted by the Collateral Documents and (ii) such other evidence that all other actions, including, but not limited to, the payment of all filing and recording fees and taxes, necessary or, in the opinion of the Administrative Agent, desirable to perfect and protect the priority of the security interests and liens created by the Collateral Documents,
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and to enhance the Administrative Agents ability to preserve and protect its interests in and access to the Collateral, have been taken or arrangements satisfactory to the Administrative Agent are in place therefor. The Lenders shall have received, prior to the date hereof, an appraisal valuation by Merrill Marine of the assets described in clauses (i) and (ii) of Section 2.20 and such additional assets as may be agreed upon by the parties, and the equipment to be allocated to the collateral described in such clauses shall have been so allocated in a manner reasonably agreed by the Administrative Agent and the Arrangers.
(i) Termination of Existing Credit Facilities; Payment of Existing Notes and NASDI Acquisition Note . The Administrative Agent shall have received evidence satisfactory to the Administrative Agent that (i) all Debt and all other obligations of the Loan Parties under the Existing Credit Agreement (other than contingent indemnification and expense reimbursement obligations and obligations with respect to Existing L/Cs) shall be repaid from the proceeds of the initial Loans hereunder, and all agreements and instruments evidencing and securing such Debt shall be terminated, (ii) the Existing Notes that have been tendered prior to the Closing Date shall have been retired or repurchased in full in accordance with the Trust Indenture Act and the terms of the Existing Notes Indenture, and the Administrative Agent and the Arrangers shall have received evidence reasonably satisfactory to them either that (x) an amount sufficient to redeem the remaining Existing Notes not so retired or repurchased prior to the Closing Date has been irrevocably deposited with The Bank of New York, as trustee under the Existing Notes Indenture, in accordance with the terms of the Existing Note Indenture for the purpose of redeeming the remaining Existing Notes or (y) the remaining Existing Notes have been otherwise irrevocably called for redemption, repurchase or retirement and the amounts required for such redemption, repurchase or retirement irrevocably committed, set aside and/or defeased, as may be agreed upon among the Administrative Agent, the Arrangers and the Borrower, for the purpose of effecting such redemption, repurchase or retirement, and (iii) the NASDI Acquisition Note shall have been repaid in full and any commitments in respect thereof have been terminated. In each case, the Administrative Agent shall have received evidence satisfactory to it that, if applicable, arrangements satisfactory to the Administrative Agent have been made for the termination of Liens and security interests granted in connection with the Debt described in clauses (i), (ii) and (iii) above.
(j) Acquisition, etc. The Administrative Agent shall have received evidence reasonably satisfactory to it that (i) each of the representations and warranties set forth in Section 5.1(v) are true and accurate, (ii) that copies of a file-stamped certificate of merger with respect to the Acquisition or other evidence reasonably satisfactory to the Administrative Agent that such certificate of merger have been filed and all waiting periods with respect to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (and all other applicable laws and regulations) if applicable, have expired or been waived with respect to the Acquisition and related transactions, (iii) Holdings has received gross cash proceeds of at least $96,700,000 from the Initial Capital Contribution and that all of such proceeds have been contributed by Holdings to the equity capital of the Borrower, (iv) that the Borrower has received gross cash proceeds of at least $175,000,000 from the Note Issuance (less fees and expenses incurred by the
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Borrower in connection therewith, as contemplated by the Note Indenture) and that such net proceeds shall have been released to the Borrower from escrow, (v) that the Acquisition has been, or concurrently is being, consummated in accordance with all applicable law for a purchase price satisfactory to the Arrangers, (vi) that the fees and expenses to be incurred in connection with the Acquisition and the financing thereof shall not exceed $17,000,000 and (vii) that copies of all executed Related Documents (including all schedules and exhibits thereto), each in form and substance reasonably satisfactory to the Arrangers and the Administrative Agent, have been delivered to the Administrative Agent.
(k) Bonding and Intercreditor Agreements . The Administrative Agent shall have received a fully executed Intercreditor Agreement which shall be in form and substance reasonably satisfactory to the Administrative Agent and the Lenders, and a certified copy of the Bonding Agreement in existence on the Closing Date, which shall be in form and substance reasonably satisfactory to the Administrative Agent.
(l) Closing Fees, Expenses, etc . The Administrative Agent shall have received for its own account, or for the account of each Lender, as the case may be, all fees then earned and due and payable pursuant to Section 2.14 and all costs and expenses which have been invoiced and are payable pursuant to Section 9.4 .
(m) Ownership Structure, etc . Each of the Lenders shall be reasonably satisfied with the ownership structure and the shareholder arrangements of the Borrower and each of the Guarantors, including, without limitation, the charter and bylaws (or equivalent documents) of each Loan Party.
(n) Equipment Financing . Each Lender shall be reasonably satisfied that the material terms of the Borrowers Equipment Financing Debt are substantially similar to those material terms disclosed to the Arrangers prior to November 7, 2003.
(o) Insurance . The Lenders shall be satisfied that the amount, types and terms and conditions of all insurance maintained by Holdings, the Borrower and each of the Borrowers Subsidiaries shall be substantially similar to each such Persons existing insurance and that such insurance reasonably satisfies the requirements of Section 6.1 . The Lenders shall have received endorsements naming the Administrative Agent, on behalf of the Lenders, as additional insured or loss payee, as the case may be, under all insurance policies to be maintained with respect to the properties of Holdings the Borrower and the Borrowers Subsidiaries forming part of the Collateral and all liability policies required by the Loan Documents.
(p) Anti-Terrorism Regulation . To the extent requested, the Arrangers and Lenders shall have received all documentation and other information required by bank regulatory authorities under applicable Know Your Customer and anti-money laundering rules and regulations, including without limitation, the USA Patriot Act.
(q) Other Conditions . The conditions precedent to each Borrowing as provided in Section 4.2 shall be satisfied on the Closing Date.
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SECTION 4.2 . Conditions Precedent to Each Borrowing and Each Issuance of a Letter of Credit . The obligation (a) of each Lender to make its initial Loans and each subsequent Loan and (b) of each Issuing Lenders to issue its initial and each subsequent Letter of Credit (other than the Existing L/Cs) and the Lenders obligations to participate in such Letters of Credit shall be subject to each of the following conditions precedent that on the date of each such Borrowing or the issuance of such Letter of Credit:
(a) the following statements shall be true and correct (and each of the giving of an applicable Notice of Borrowing, or a Letter of Credit Request, and the acceptance by the Borrower of the proceeds of such Loan, or the issuance of such Letter of Credit, shall constitute a representation and warranty by the Borrower that on the date of such Loan, or the issuance of such Letter of Credit, such statements set forth in clauses (i) through (iii) are true):
(i) The representations and warranties contained in Section 5.1 and in the other Loan Documents are true and correct in all material respects on and as of the date of such Loan or the issuance of such Letter of Credit, as the case may be, both before and after giving effect to such Loan or the issuance of such Letter of Credit, and, in the case of any such Loan, to the application of the proceeds therefrom, as though made on and as of such date except for any representation or warranty which is specified as being made as of an earlier date, in which case such representation or warranty shall only speak as to such earlier date;
(ii) No event has occurred and is continuing, or would result from such Loan or the issuance of such Letter of Credit, as the case may be, or, in the case of any such Loan, from the application of the proceeds therefrom, which constitutes a Default or an Event of Default; and
(iii) (A) Revolving Loans outstanding plus the Letters of Credit Obligations shall not exceed the Revolving Commitment Amount, both before and after giving effect to such Loan and/or such Letter of Credit and (B) in the case of the issuance of a Letter of Credit, the Letter of Credit Obligations shall not exceed the Letter of Credit Availability, both before and after giving effect to such Letter of Credit.
(b) no law or regulation shall prohibit, and no order, judgment or decree of any Governmental Authority shall enjoin, prohibit or restrain, such Lender from making the requested Loan, or issuing or participating in the requested Letter of Credit, as the case may be.
SECTION 4.3 . No Waiver . In no event shall any Lenders making of any Loan or issuance of or participation in a Letter of Credit hereunder at a time when any condition precedent to any Loan or Letter of Credit, as specified in this Article IV , was not satisfied (a) constitute a waiver of such condition by such Lender with respect to subsequently requested Loans or Letters of Credit, or (b) to the extent such unsatisfied
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condition constituted a Default or Event of Default, constitute a waiver by any Lender of such Default or Event of Default.
ARTICLE V
.
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 . Representations and Warranties of the Loan Parties . In order to induce the Lenders and the Issuing Lenders to enter into this Agreement, and to make the Loans and issue, maintain and/or participate in the Letters of Credit, each Loan Party which is a party hereto represents and warrants to each Lender and each Issuing Lender as of the Closing Date, and (unless specified to speak only as of a specified date) on and as of the date of any Loan or the issuance, amendment or extension of any Letter of Credit that:
(a) Organization; Corporate Powers . Each Loan Party (i) is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization (except to the extent that such Loan Partys failure to be in good standing under such laws could not reasonably be expected to have a Material Adverse Effect and except as otherwise as a result of a transaction permitted under Section 6.2(a)(i) ), (ii) is duly qualified to do business as a foreign corporation and in good standing under the laws of each jurisdiction in which such qualification and good standing are necessary in order for it to conduct its business and own its property as heretofore conducted and owned (except such jurisdictions where failure to so qualify could not reasonably be expected to have a Material Adverse Effect), and (iii) has all requisite corporate power to conduct its business, to own and operate its property and to execute, deliver and perform all of its obligations under the Loan Documents and other Transaction Documents to which it is a party.
(b) Authorizations; Enforceability . Each Loan Party has the requisite corporate authority to execute, deliver and perform each of the Loan Documents and other Transaction Documents executed by it. Each of the Loan Documents and other Transaction Documents to which any Loan Party is party has been duly executed and delivered by such Loan Party and constitutes the legal, valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors rights generally and to general principles of equity, regardless of whether enforcement is sought in a proceeding at law or in equity.
(c) No Conflict . The execution, delivery and/or performance by each Loan Party of each Loan Document and other Transaction Document to which it is a party do not and will not, by the lapse of time, the giving of notice or otherwise, (i) constitute a violation of any Applicable Law or a breach of any provision contained in such partys charter or by-laws or contained in any material agreement, instrument or document to which Holdings, the Borrower or any of the Borrowers Subsidiaries is a party or by which it is bound or (ii) result in or require the creation or imposition of any Lien whatsoever upon any of the properties or assets of Holdings or any of its Subsidiaries (other than Liens granted pursuant to the Collateral Documents).
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(d) Approvals . No approval, consent or authorization of, or notice to or filing with, any Governmental Authority or any securities exchange is required in connection with the execution, delivery or performance by any Loan Party of any of the Loan Documents or other Transaction Documents, or the granting of a Lien on any of the Collateral in the manner and for the purpose contemplated by the Collateral Documents, except (i) filings and recording to perfect such Liens, (ii) those obtained on or prior to the Closing Date and (iii) those which, if not obtained, could not reasonably be expected to have a Material Adverse Effect.
(e) Licenses and Permits . Each of Holdings, the Borrower and each of the Borrowers Subsidiaries owns or possesses or is licensed or otherwise has the right to use all Permits and other governmental approvals and authorizations, franchises, authorizations and other rights that are reasonably necessary for the operations of its business as currently conducted, without, to the knowledge of Holdings or any of its Subsidiaries, conflict with the rights of any other Person with respect thereto, except where the failure to be so licensed or to have such Permits would not have a Material Adverse Effect.
(f) Financial Reports .
(i) The unaudited pro forma consolidated balance sheet of the Borrower and its consolidated Subsidiaries as at September 30, 2003 (the Pro Forma Balance Sheet ), copies of which have heretofore been furnished to each Lender, has been prepared giving effect (as if such events had occurred on such date) to (i) the consummation of the Acquisition and other Transactions, (ii) the Loans to be made and the Note Issuance and the use of proceeds thereof and (iii) the payment of fees and expenses in connection with the foregoing. The Pro Forma Balance Sheet has been prepared based on the best information available to the Borrower as of the date of delivery thereof, and presents fairly in all material respects on a pro forma basis the estimated financial position of Borrower and its consolidated Subsidiaries as at September 30, 2003, assuming that the events specified in the preceding sentence had actually occurred at such date.
(ii) The consolidated balance sheet of the Borrower and its Subsidiaries as at December 31, 2001 and December 31, 2002 and as at September 30, 2003, and the related consolidated statements of earnings and cash flows of the Borrower and its Subsidiaries for the Fiscal Year-ended December 31, 2001 and December 31, 2002 and for the period from January 1, 2003 through September 30, 2003, copies of each of which have been furnished to each Lender, fairly present in all material respects the consolidated financial condition of the Borrower and its Subsidiaries as at such respective dates and the consolidated results of the operations of the Borrower and its Subsidiaries for such respective periods ended on such dates, all in accordance with GAAP, consistently applied; provided that such financial statements delivered for any period other than a Fiscal Year may lack certain footnote disclosures which would otherwise be required by GAAP and may be subject to normal year-end adjustments. Since December 31, 2002, there has been no change in any circumstances, facts or
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conditions nor shall an event have taken place which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.
(g) Title to Property; Liens .
(i) Each of Holdings, the Borrower and each of the Borrowers Subsidiaries has good and marketable title to, or a valid leasehold interest in, all of its properties and assets, real and personal, of any nature whatsoever, free and clear of all Liens, except for Liens permitted by Section 6.2(h) . The assets and properties owned by and leased to Holdings, the Borrower or any of the Borrowers Subsidiaries which are necessary in the conduct of their respective businesses are in adequate operating condition and repair, ordinary wear and tear and damage due to casualty excepted, are free and clear of any known defects except such defects as do not substantially interfere with the continued use thereof in the conduct of normal operations, and are able to serve the function for which they are intended in the conduct of such Persons business.
(ii) As of the Closing Date and as of the date of each annual delivery of the list of Designated Vessels pursuant to Section 6.4(g) , except to the extent set forth on Schedule 5.1(g) , the Borrower and the Subsidiary Guarantors are the sole and lawful owners of each Designated Vessel and hold valid legal title to the whole of such Designated Vessels. The Borrower and the Subsidiary Guarantors lawfully own and are lawfully possessed of each Designated Vessel free from any Lien, charge or encumbrance whatsoever, except as permitted pursuant to Section 6.2(h) , and will warrant and defend the title and possession thereto and to every part thereof for the benefit of the Lenders against the material claims and demands of any Person whomsoever.
(h) No Default . None of Holdings, the Borrower or any of the Borrowers Subsidiaries is in violation of any Applicable Law, or in default under any agreement or instrument to which any of such Persons is a party or by which any of their respective properties or assets is bound or affected, which violation or default could reasonably be expected to have a Material Adverse Effect. No Event of Default or Default has occurred and is continuing.
(i) Litigation; Contingent Liabilities; Labor Matters .
(i) Except as set forth in Schedule 5.1(i ) or in the financial statements described in Section 5.1(f) , no claims, litigation, arbitration proceedings or governmental proceedings are pending or, to the knowledge of the Loan Parties, overtly threatened against or, to the knowledge of the Loan Parties, are affecting Holdings, the Borrower, or any of the Borrowers Subsidiaries, or any of their respective properties, assets or revenues, the results of which could reasonably be expected to have a Material Adverse Effect.
(ii) Other than any liability incident to the claims, litigation or proceedings disclosed in Schedule 5.1(i) , or provided for or disclosed in the
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financial statements referred to in Section 5.1(f) , as of the Closing Date, none of Holdings, the Borrower or any of the Borrowers Subsidiaries has any contingent liabilities which could reasonably be expected to have a Material Adverse Effect.
(j) Patents, Trademarks and Licenses . Holdings, the Borrower and each of the Borrowers Subsidiaries owns or possesses all the licenses, patents, copyrights, trademarks, service marks, trade names, and other similar property rights which are reasonably necessary for the present conduct of its business, without, to the knowledge of Holdings or any of its Subsidiaries, conflict with the rights of any other Person with respect thereto, except where the failure to own or possess such property, or the existence of any such conflict, could not reasonably be expected to have a Material Adverse Effect.
(k) ERISA . As to each Plan which is not a Multiemployer Plan and which is intended to be qualified under Section 401(a) of the IRC as currently in effect, either (i) such Plan has been determined by the IRS to be so qualified, and each trust related to such Plan has been determined to be exempt from federal income taxation under Section 501(a) of the IRC as currently in effect, (ii) an application for a determination for such Plan has been filed and is now pending with the IRS, or (iii) the failure of such Plan to be so qualified or determined to be exempt could not reasonably be expected to have a Material Adverse Effect. As of the Closing Date, except as disclosed on Schedule 5.1(k) , none of Holdings, the Borrower or any of the Borrowers Subsidiaries maintains or contributes to any employee welfare benefit plan within the meaning of Section 3(1) of ERISA which provides benefits to employees after termination of employment other than as required by Section 601 of ERISA. None of Holdings, the Borrower, or any of the Borrowers Subsidiaries or any ERISA Affiliate has failed to comply with any of the responsibilities, obligations or duties imposed on it by ERISA or regulations promulgated thereunder with respect to any Plan which failure could reasonably be expected to have a Material Adverse Effect. No Plan has incurred any accumulated funding deficiency (as defined in Sections 302(a)(2) of ERISA and 412(a) of the IRC) whether or not waived. Except as disclosed on Schedule 5.1(k) , none of Holdings, the Borrower, or any of their respective Subsidiaries or any ERISA Affiliate nor to the knowledge of the Loan Parties any fiduciary of any Plan which is not a Multiemployer Plan (i) has engaged in a nonexempt prohibited transaction described in Section 406 of ERISA or Section 4975 of the IRC which could reasonably be expected to have a Material Adverse Effect or (ii) has taken or failed to take with respect to any Plan any action which would constitute or result in a Termination Event. None of Holdings, the Borrower, or any of the Borrowers Subsidiaries or any ERISA Affiliate has incurred any potential liability under Section 4063, 4064, 4069, 4204 or 4212(c) of ERISA. None of Holdings, the Borrower, or any of the Borrowers Subsidiaries or any ERISA Affiliate has incurred any liability to the PBGC which remains outstanding other than the payment of premiums, and there are no premium payments which have become due which are unpaid. Except as disclosed on Schedule 5.1(k) , none of Holdings or any of the Borrowers Subsidiaries or any ERISA Affiliate has (i) failed to make a required contribution or payment to a Multiemployer Plan or (ii) made a complete or partial withdrawal under Sections 4203 or 4205 of ERISA from a Multiemployer Plan. None of Holdings or any of its Subsidiaries or any ERISA Affiliate has failed to make a required
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installment or any other required payment under Section 412 of the IRC on or before the due date for such installment or other payment. None of Holdings, the Borrower or any of the Borrowers Subsidiaries or any ERISA Affiliate is required to provide security to a Plan under Section 401(a)(29) of the IRC due to a Plan amendment that results in an increase in current liability for the plan year.
(l) Environmental Matters .
(i) Except as specifically disclosed in Schedule 5.1(l) , the ongoing operations of Holdings, the Borrower and each of the Borrowers Subsidiaries have complied and currently comply in all respects with all Environmental Laws, except to the extent that such noncompliance could not reasonably be expected to have a Material Adverse Effect.
(ii) Except as specifically disclosed in Schedule 5.1(1) , each of Holdings, the Borrower and each of the Borrowers Subsidiaries has obtained all Permits required under any Environmental Law ( Environmental Permits ) and necessary for its ordinary course operations, all such Environmental Permits have been and are currently in good standing in all respects, and each of Holdings, the Borrower and each of the Borrowers Subsidiaries is and has been in compliance with all terms and conditions of each such Environmental Permit, except in each case, where the failure to obtain, remain in good standing, or otherwise be in compliance with, such Environmental Permit could not individually or in the aggregate reasonably be expected to have a Material Adverse Effect.
(iii) Except as specifically disclosed in Schedule 5.1(l) , none of Holdings, the Borrower or any of the Borrowers Subsidiaries or any of their respective present or to the Loan Parties knowledge, former Property or operations is subject to any outstanding written order from or agreement with any Governmental Authority nor subject to any pending or, to any Loan Partys knowledge threatened, claim or proceeding under Environmental Laws, nor has been notified that it is a potentially responsible party, respecting any Environmental Law, Environmental Claim or Hazardous Material which, in any such case, could reasonably be expected to have a Material Adverse Effect.
(iv) Except as specifically disclosed in Schedule 5.1(l) , there are no Hazardous Materials or other conditions or circumstances existing with respect to any current or, to the knowledge of any Loan Party, former Property, or arising from operations prior to the Closing Date, of Holdings, the Borrower or any of the Borrowers Subsidiaries that could reasonably be expected to give rise to Environmental Claims which would have a Material Adverse Effect. To the best knowledge of the Loan Parties, as of the Closing Date, none of Holdings, the Borrower, or any of the Borrowers Subsidiaries has any underground storage tanks (x) that are not properly registered or permitted under applicable Environmental Laws, (y) that are not in compliance with any Environmental Permits or Environmental Laws, or (z) with respect to which a Release has occurred, on or off-site. Each of Holdings, the Borrower and each of the
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Borrowers Subsidiaries has notified all of its employees of the existence, if any, of any health hazard arising from the conditions of their employment of which the Loan Parties have knowledge in a manner consistent with all applicable laws and have met all notification requirements under Title III of CERCLA and all other Environmental Laws except where a failure to so notify such employees could not reasonably be expected to have a Material Adverse Effect.
(v) To the best knowledge of the Loan Parties, except as specifically disclosed in Schedule 5.1(l) , as of the Closing Date, none of the Properties has at any time been operated as a treatment, storage or disposal facility.
(vi) To the best knowledge of the Loan Parties, except as set forth in Schedule 5.1(l) , none of Holdings, the Borrower or any of the Borrowers Subsidiaries has any contingent liability in connection with (1) any actual, threatened, or potential Release into the environment of, or otherwise with respect to, any Hazardous Material or other hazardous, toxic or dangerous waste, substance or constituent, or other substance, whether on any premises now or previously owned or occupied by Holdings, the Borrower or any of the Borrowers Subsidiaries or on any other premises or from any vessel or vehicle owned, operated or leased by Holdings or any of Borrowers Subsidiaries that could reasonably be expected to have a Material Adverse Effect or (2) any other unsafe or unhealthful condition that could reasonably be expected to have a Material Adverse Effect.
(m) Payment of Taxes . Holdings, the Borrower and each of the Borrowers Subsidiaries have filed all federal income and other federal, state and local tax returns and other reports as required by law, and have paid all taxes and other similar charges (including employment taxes) that are due and payable, after giving effect to any extensions therefor, except (i) such taxes, if any, that are being contested in good faith by appropriate proceedings and have been adequately reserved against in accordance with GAAP or (ii) any such returns, taxes, or charges the nonfiling or nonpayment of which could not be reasonably expected to have a Material Adverse Effect. None of the Loan Parties has any knowledge of any proposed tax assessment against any of them or against any Subsidiaries of the Borrower not constituting Loan Parties for which adequate provision has not been made on its accounts. The provisions for taxes on the books of Holdings, the Borrower and each of the Borrowers Subsidiaries are adequate for all open years, and for its current fiscal period.
(n) Fiscal Year . Each of Holdings, the Borrower and each of the Borrowers Subsidiaries has established a Fiscal Year ending on December 31 each year.
(o) Governmental Regulation . None of the Loan Parties is subject to regulation under the Interstate Commerce Act, the Investment Company Act of 1940, the Public Utility Holding Company Act of 1935 , the Federal Power Act or any other Applicable Law that restricts such Loan Partys ability to incur debt, guaranty obligations
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or to grant Liens, except to the extent that such regulation could not reasonably be expected to have a Material Adverse Effect.
(p) Margin Regulations . None of Holdings, the Borrower or any of the Borrowers Subsidiaries is engaged, principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any margin stock (as each of the quoted terms is defined or used in Regulation T, U or X of the Board of Governors of the Federal Reserve System as in effect from time to time). No part of the proceeds of any of the Loans and no Letter of Credit has been used for so purchasing or carrying margin stock or for any purpose which violates, or which would be inconsistent with, the provisions of Regulation T, U or X.
(q) Other Loan Documents . The representations and warranties made by each Loan Party contained in each Loan Document are true and correct in all material respects.
(r) Corporate Structure; Capitalization . As of the Closing Date, a complete and correct disclosure of each Subsidiary of Holdings in existence as of the Closing Date is set forth in Schedule 5.1(r)(i) , together with the names, jurisdictions of organization, the percentage of shares of such Persons owned by Holdings, the Borrower and each Subsidiary of the Borrower as of the Closing Date. As of the Closing Date, the names and ownership percentages (stated both on an outstanding and fully-diluted basis) of each legal, record owner of each class of the issued and outstanding shares of Capital Stock of Holdings and the Borrower, and each Subsidiary of the Borrower, and of all issued and outstanding warrants, options, stock appreciation rights and other convertible interests with respect to Holdings, the Borrowers, or such Subsidiarys Capital Stock, are completely and accurately set forth in Schedule 5.1(r)(ii) . As of the Closing Date, the issued and outstanding shares of Capital Stock of Holdings, the Borrower and each Subsidiary of the Borrower have been validly issued, are fully paid and nonassessable and are owned directly or indirectly by Holdings, the Borrower or the other applicable Persons as described in Schedule 5.1(r)(i) , free and clear of all Liens (other than Liens permitted hereunder). No shares of Capital Stock of such Subsidiary are held as or otherwise constitute treasury stock. No authorized but unissued shares of Capital Stock of Holdings, the Borrower or any such Subsidiary are subject to any option, warrant, right to call, preemptive right or other commitment of any kind whatsoever.
(s) Debt; Contingent Obligations; Solvency . As of the Closing Date, the financial statements referred to in Section 5.1(f) contain a complete and accurate disclosure in all material respects of (i) all Debt of Holdings and its Subsidiaries outstanding as of the respective dates of such financial statements and (ii) all material loss contingencies and other material contingent obligations of Holdings and its Subsidiaries as of such dates, except for Guaranties disclosed on Schedule 6.2(f) . As of the Closing Date, none of Holdings, the Borrower or any of the Borrowers Subsidiaries has incurred any other Debt or Guaranties since the respective dates of such financial statements, except as would have been permitted under Sections 6.2(f ) and 6.2(i) of this Agreement had this Agreement been in effect at the time of the incurrence of any such additional Debt or Guaranties. As of the Closing Date, none of Holdings, the Borrower
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or any of its Subsidiaries has incurred any loss contingencies or other contingent obligations since the respective dates of such financial statements which could reasonably be expected to have a Material Adverse Effect. Holdings and the other Loan Parties, on a consolidated basis, are Solvent prior to, and on the date of each Borrowing or Issuance of a Letter of Credit, after giving effect to the consummation of the Transactions, including the Loans made, or to be made, and Letters of Credit to be issued, or to be issued, to the Borrower on the Closing Date.
(t) Insurance . As of the Closing Date, Schedule 5.1(t) sets forth a complete and accurate list in all material respects of insurance policies and programs in effect with respect to the properties and businesses of Holdings, the Borrower and each of the Borrowers Subsidiaries, specifying for each such policy and program, (i) the amount thereof, (ii) the risks insured against thereby, (iii) the name of the insurer and each insured party thereunder and (iv) the policy or other identification number thereof. Such insurance policies and programs are in such forms and amounts, and provide coverage against such risks as are required by Section 6.1(c) and are customary for corporations of established reputation engaged in the same or a similar business and owning and operating similar properties.
(u) Collateral Documents . The provisions of the Collateral Documents executed by any Loan Party in favor of the Administrative Agent evidence legal, valid, enforceable and continuing Liens, in favor of the Administrative Agent for the benefit of the Secured Parties, in all right, title and interest of such Loan Party in any and all of the Collateral described therein, securing the Obligations from time to time outstanding, and upon all proper filings and recordings being duly made in the locations referred to in the applicable Collateral Documents or the taking of possession of the Collateral by the Administrative Agent in accordance with the provisions of such Collateral Documents, each of such Collateral Documents constitutes a fully perfected first or second priority Lien in all right, title and interest of such Loan Party in such Collateral superior in right to any Liens (other than the Liens of Travelers), existing or future, which such Loan Party or any creditors thereof or purchasers therefrom, or any other Person, may have against such Collateral or interests therein, except for Liens permitted by Section 6.2(h) .
(v) The Transactions . (i) (A) All conditions precedent to, and all material consents necessary to permit, the Acquisition pursuant to the Acquisition Agreement, the Note Issuance pursuant to the Note Indenture, the Initial Capital Contribution, and the effectiveness of the Travelers Agreement pursuant to its terms, have been satisfied or delivered, or waived with the prior written consent of the Majority Lenders, (B) no material breach of any term or provision of the Acquisition Agreement, the Note Indenture, the Travelers Agreement or documents relating to the Initial Capital Contribution has occurred, (C) the Acquisition, the Note Issuance and the Initial Capital Contribution each have been consummated (or are being consummated simultaneously with the making of the initial Loans hereunder), in accordance with all Applicable Laws, (D) all governmental and material third party approvals necessary in connection with the Transactions shall have been obtained and are in full force and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any
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Governmental Authority which would restrain, prevent or otherwise impose materially adverse conditions on any of the Transactions and (E) no actions, suits or proceedings are pending or threatened with respect to any of the Transactions or any Loan Document or Related Document which the Administrative Agent or the Majority Lenders shall reasonably determine could reasonably be expected to have a Material Adverse Effect.
(ii) Each of the Related Documents filed with the Securities and Exchange Commission or other securities authorities, including, without limitation, the offering memorandum with respect to the Note Issuance, complied (when filed) in all material respects with all applicable provisions of the 1933 Act, 1934 Act, all other federal securities laws, state securities or Blue Sky laws, foreign securities laws, general corporation law and all rules and regulations thereunder.
(iii) The Borrower has delivered to the Administrative Agent true, correct and complete, executed copies of each of the Related Documents, including, without limitation, all amendments, schedules and exhibits thereto, and all other material agreements, documents, and certificates which have been executed and delivered in connection with the Transactions.
(w) Accuracy of Information . The schedules, certificates and other written statements and information furnished to the Administrative Agent, the Issuing Lenders and the Lenders by or on behalf of any Loan Party in connection with the negotiation of this Agreement and the other Loan Documents do not contain any material misstatement of material fact or omit to state a material fact or any fact necessary to make the material statements contained therein not misleading in any material respect in light of the circumstances under which such information was provided as of the time when delivered. As of the Closing Date, there is no fact currently known to any Loan Party which now or in the future could reasonably be expected to have a Material Adverse Effect and which has not been set forth or referred to in this Agreement, the other Loan Documents, or such schedules, certificates, statements or information heretofore furnished to the Administrative Agent.
(x) Obligations and Guaranties Senior Debt under Note Indenture . The Obligations and the Guaranties constitute Senior Debt as defined in the Note Indenture.
ARTICLE VI.
COVENANTS
SECTION 6.1. Affirmative Covenants . Each Loan Party which is a party hereto covenants and agrees that so long as any of the Lenders shall have any Commitment hereunder, there shall exist any outstanding Loans, any Letter of Credit shall remain outstanding, or any other Obligations (other than contingent obligations hereunder for which no claim has been, or is reasonably expected to be, made) shall remain outstanding:
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(a) Corporate Existence . Holdings, the Borrower and each of the Borrowers Subsidiaries shall maintain its corporate existence, qualification and good standing in all jurisdictions in which such qualification and good standing are necessary in order for each such Person to conduct its business and own its property as presently conducted and owned in such jurisdictions (except in such jurisdictions where the failure to remain so qualified and in good standing could not reasonably be expected to have a Material Adverse Effect) and Holdings, the Borrower and each of the Borrowers Subsidiaries shall maintain all rights, privileges, licenses, patents, patent rights, copyrights, trademarks, trade names, trade styles, franchises and other authority for the conduct of its respective business in the ordinary course as conducted from time to time, except to the extent that the failure to maintain such rights, privileges, licenses, patents, patent rights, copyrights, trademarks, trade names, trade styles, franchises and other authority would not be reasonably expected to have a Material Adverse Effect.
(b) Compliance with Laws . Holdings, the Borrower and each of the Borrowers Subsidiaries shall (i) comply with all Applicable Laws applicable to such Person (except where the failure to so comply could not reasonably be expected to have a Material Adverse Effect) and (ii) obtain as needed, and maintain in good standing, all Permits and other governmental approvals and authorizations necessary for its operations (except where the failure to obtain or maintain such Permits and approvals could not reasonably be expected to have a Material Adverse Effect).
(c) Maintenance of Properties; Insurance .
(i) Holdings, the Borrower and each of the Borrowers Subsidiaries shall (A) obtain the consent or approval of any Person whose consent or approval is required in order for Holdings, the Borrower or such Subsidiary to grant or keep effective Liens to or for the benefit of the Administrative Agent in any property of Holdings, the Borrower or such Subsidiary intended to secure the Obligations; and (B) maintain in good repair, working order and condition, excepting ordinary wear and tear and damage due to casualty, all of its material properties which are used in the conduct of its business (whether owned or leased by such party) and make or cause to be made all appropriate repairs, renewals and replacements thereof, in each case consistent with sound business practices; provided that such obligation shall not apply to property that Holdings, the Borrower or such Subsidiary reasonably determines in good faith that maintenance thereof is no longer economically desirable.
(ii) Holdings, the Borrower and each of the Borrowers Subsidiaries shall maintain the following insurance policies and programs:
(A) physical damage insurance on all material real and personal property (including inventory) covering (1) for all open and operating facilities, repair and replacement cost of all such property and (2) for all closed, inactive vacant facilities, the actual cash value of such facilities;
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(B) general liability insurance (including products and completed operations liability coverage) in an aggregate amount of not less than $65,000,000;
(C) Longshoremen and Harbor Workers insurance per statutory limits;
(D) hull and machinery insurance in an aggregate amount of not less than $200,000,000;
(E) protection and indemnity, including Masters and Members of Crew insurance in an aggregate amount of not less than $75,000,000;
(F) Workers compensation insurance per statutory limits;
(G) Wrongful draw insurance with respect to each Letter of Credit having an aggregate Dollar equivalent face amount in excess of $10,000,000 and supporting contracts to be performed in a country other than the United States or for a beneficiary in a country other than the United States in an amount equal to such excess, unless (1) the Borrower shall have notified the Administrative Agent that it has determined, in good faith, that such insurance with respect to such Letter of Credit is not available at a reasonable economic cost or not available from a reputable insurer and (2) the Administrative Agent shall have concurred with such conclusion in writing (which concurrence shall not be unreasonably withheld or delayed);
(H) insurance to protect against asset seizure with respect to each contract to be performed by the Borrower or its Subsidiaries in a country outside of the United States, in an amount equal to the aggregate fair market value of the assets used by the Borrower and its Subsidiaries in fulfilling their respective obligations under such contract unless (1) the Borrower shall have notified the Administrative Agent that it has determined, in good faith, that such insurance with respect to such contract is not available at a reasonable economic cost or not available from a reputable insurer, or the property to be used in connection with such contract is not subject to a material risk of asset seizure in such country and (2) the Administrative Agent shall have concurred with such conclusion in writing (which concurrence shall not be unreasonably withheld or delayed);
(I) contractors pollution liability coverage of not less than $5,000,000; and
(J) such other additional insurance coverage and with respect to such risks as is customary for businesses similar to that of Holdings and its Subsidiaries.
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All such insurance shall be provided by (x) the insurers listed on Schedule 5.1(t) , (y) insurers that have an A.M. Best policy-holders rating of not less than A, or if no such rating is applicable, having a quality comparable to those rated A or better, or (z) such other insurers as the Administrative Agent may approve reasonably in writing, and shall contain endorsements, in form and substance reasonably satisfactory to the Administrative Agent, naming the Administrative Agent as loss payee with respect to each casualty insurance policy which insures any Collateral and as an additional insured with respect to each liability insurance policy.
(iii) The Borrower shall deliver or cause to be delivered to the Administrative Agent, on or before the Closing Date, copies of certificates of insurance with respect to each of the Borrowers and its Subsidiaries policies of insurance described in Section 6.1(c) , as in effect on the Closing Date. In addition, the Borrower shall deliver to the Administrative Agent prompt written notice of any cancellation or reduction in the amount or coverage of any of the insurance policies required by this Section 6.1(c) and, in the event any new or substitute policies shall be issued, the Borrower shall promptly request its insurers (or their agents) to deliver certificates evidencing such new or substitute insurance to the Administrative Agent.
(d) Notice of Litigation . The Borrower shall deliver or cause to be delivered to the Administrative Agent, promptly following the occurrence and the Borrower acquiring knowledge thereof, notice of any of the following events: (i) the institution of, or threat in writing of, any action, suit, proceeding, governmental investigation or arbitration against or affecting Holdings, the Borrower or any of the Borrowers Subsidiaries, which (A) could reasonably be expected to have a Material Adverse Effect or (B) relates to any Loan Document, (ii) any development in any action, suit, proceeding, governmental investigation or arbitration already disclosed which could reasonably be expected to have a Material Adverse Effect and (iii) any judgment (or judgments) or money judgment (or judgments), writ or warrant of attachment, or similar process involving in excess of $15,000,000 (or $6,000,000 in the aggregate to the extent not covered by insurance which is confirmed in writing by the insurers or agents of Holdings, the Borrower or any of the Borrowers Subsidiaries as covering such judgment or process) in the aggregate being entered or filed against any of the Loan Parties or any of their respective assets.
(e) Taxes; Claims . Holdings, the Borrower and each of the Borrowers Subsidiaries shall (i) promptly file all material federal, state and local tax returns and other reports which such Person is required by law to file, (ii) maintain adequate reserves for the payment of all material taxes, assessments, governmental charges, and other similar charges, and pay promptly, when due, all such taxes, assessments, and other charges (including employment taxes) in such manner as will not give rise to any Lien other than Customary Permitted Liens, (iii) promptly pay all other Claims (including claims for labor, services, materials and supplies) that have become due and payable and that by law have or may give rise to a Lien on such Persons property or assets, prior to the time when any penalty or fine may be incurred with
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respect thereto and otherwise in such manner as will not give rise to any Lien other than Customary Permitted Liens, and (iv) pay all trade accounts payable in accordance with customary business terms; provided that none of Holdings, the Borrower or any of the Borrowers Subsidiaries shall be required to pay any such tax, assessment, charge, claim or account which (x) (1) is being contested in good faith by appropriate proceedings which will prevent the forfeiture or sale of any Property or any material interference with the use thereof by such Person, and (2) has been adequately reserved against in accordance with GAAP or (y) if not so paid, could not reasonably be expected to have a Material Adverse Effect.
(f) ERISA Notices . The Borrower shall deliver or cause to be delivered to the Administrative Agent, at the Borrowers expense, the following information and notices:
(i) within ten (10) Business Days after any of Holdings, the Borrower, any of the Borrowers Subsidiaries or any ERISA Affiliate knows that a Termination Event has occurred, a written statement of the chief financial officer of the Borrower describing such Termination Event and the action, if any, which Holdings, the Borrower or any of their respective Subsidiaries or ERISA Affiliate has taken, is taking or proposes to take with respect thereto, and when known, any action taken or threatened by the IRS, DOL or PBGC with respect thereto;
(ii) within ten (10) Business Days after any of Holdings, the Borrower, any of the Borrowers Subsidiaries or any ERISA Affiliate knows that a prohibited transaction (defined in Sections 406 of ERISA and 4975 of the IRC) has occurred which could reasonably be expected to result in liabilities to Holdings, the Borrower or any of the Borrowers Subsidiaries in excess of $2,000,000, a statement of the chief financial officer of the Borrower describing such transaction and the action which Holdings, Borrower and their respective Subsidiaries or ERISA Affiliate has taken, is taking or proposes to take with respect thereto;
(iii) within ten (10) Business Days after the filing thereof with the IRS, a copy of each funding waiver request filed with respect to any Plan and all communications received by Holdings, the Borrower or any of the Borrowers Subsidiaries or any ERISA Affiliate with respect to such request;
(iv) within ten (10) Business Days after receipt by Holdings, the Borrower or any of the Borrowers Subsidiaries or any ERISA Affiliate of the PBGCs intention to terminate a Plan or to have a trustee appointed to administer a Plan in either case in a distress termination under Section 4041(c) of ERISA, copies of each such notice;
(v) within ten (10) Business Days after receipt by Holdings or any of the Borrowers Subsidiaries or any ERISA Affiliate of any unfavorable determination letter from the IRS regarding the qualification of a Plan under
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Section 401(a) of the IRC which could reasonably be expected to result in liabilities to Holdings, the Borrower or any of the Borrowers Subsidiaries in excess of $2,000,000, copies of each such letter;
(vi) within ten (10) Business Days after the receipt by Holdings, the Borrower or any of the Borrowers Subsidiaries or any ERISA Affiliate of a notice from a Multiemployer Plan regarding the imposition of withdrawal liability which could reasonably be expected to result in liabilities to Holdings, the Borrower or any of their respective Subsidiaries in excess of $2,000,000, copies of each such notice;
(vii) within ten (10) Business Days after Holdings, or any of its Subsidiaries or any ERISA Affiliate fails to make a required installment or any other required payment under Section 412 of the IRC on or before the due date for such installment or payment which could reasonably be expected to result in the imposition of a Lien under Section 412(n) of the IRC, a notification of such failure; and
(viii) within ten (10) Business Days after Holdings, the Borrower, or any of their respective Subsidiaries or any ERISA Affiliate knows (A) a Multiemployer Plan has been terminated, (B) the administrator or plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer Plan, or (C) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate a Multiemployer Plan which, in any such case, could reasonably be expected to result in liabilities to the Borrower and its Subsidiaries in excess of $2,000,000, a notification of such event or fact.
For purposes of this Section 6.1(f) , any Loan Party and any ERISA Affiliate shall be deemed to know all facts known by the administrator of any Plan of which such Loan Party or such ERISA Affiliate is the plan sponsor.
(g) ERISA Compliance . Holdings and the Borrower shall, and shall cause each of the Borrowers Subsidiaries and each other ERISA Affiliate to, establish, maintain and operate all Plans to comply in all respects with the provisions of ERISA, IRC, and all other applicable laws, and the regulations and interpretations thereunder except to the extent such noncompliance could not reasonably be expected to have a Material Adverse Effect.
(h) Patents, Trademarks and Licenses . Holdings and the Borrower shall, and shall cause each of the Borrowers Subsidiaries to, obtain and maintain adequate licenses, patents, copyrights, trademarks, service marks, trade names, and other similar property rights to conduct its business as currently conducted, except where the failure to obtain or maintain such property rights could not reasonably be expected to have a Material Adverse Effect.
(i) Notice of Labor Disputes . The Borrower shall notify the Administrative Agent as soon as possible and in any event within three (3) days,
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following (A) the Borrowers learning of any labor dispute to which Holdings, the Borrower or any of the Borrowers Subsidiaries is likely to become a party, any strikes or walkouts, or threatened strikes or walkouts, relating to any of its plants or other facilities, and (B) the expiration or termination of any labor contract to which Holdings, the Borrower or any of the Borrowers Subsidiaries is a party or by which Holdings, the Borrower or any of the Borrowers Subsidiaries is bound (other than an expiration or termination of a labor contract which has been replaced by a new labor contract or an extension of an existing labor contract), which, in any case under clause (A) or (B) hereof, could reasonably be expected to have a Material Adverse Effect.
(j) Notice of Default . The Borrower shall promptly notify the Administrative Agent, (i) of any condition or event that constitutes a Default or an Event of Default and (ii) of any other default under any contractual obligation to which Holdings, the Borrower or any of the Borrowers Subsidiaries is a party or by which any of them or their respective properties may be bound (which default could reasonably be expected to have a Material Adverse Effect), such notice to specify the nature and period of existence of any such condition, event, or default and what action Holdings, the Borrower or such Subsidiary, as applicable, has taken, is taking or proposes to take with respect thereto.
(k) Environmental Notices . The Borrower shall notify the Administrative Agent in writing no later than ten (10) Business Days after becoming aware of any of the following which could reasonably be expected to result in liabilities or expenses of Holdings, the Borrower or any of the Borrowers Subsidiaries in excess of $3,000,000: (i) any and all enforcement, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened against Holdings or any of its Subsidiaries or any of their respective current or former Properties pursuant to any applicable Environmental Laws; (ii) all other Environmental Claims; (iii) any environmental or similar condition on any real property adjoining or in the vicinity of the Property of Holdings, the Borrower or any of the Borrowers Subsidiaries that could reasonably be expected to cause such Property or any part thereof to be subject to any restrictions on the ownership, occupancy, transferability or use of such property under any Environmental Laws; (iv) new and material changes to any existing Environmental Law; and (v) any filing or report made by the Borrower or any of its Subsidiaries with any Governmental Authority with respect to (A) the violation of any Environmental Law, (B) any unpermitted Release or threatened Release of a Contaminant that is reportable under 40 C.F.R. 302 or (C) any unsafe or unhealthful condition at any Property of the Borrower or any of its Subsidiaries.
(l) Environmental Laws .
(i) Holdings and the Borrower shall, and shall cause each of the Borrowers Subsidiaries to, conduct its operations and keep and maintain its Property in compliance with all Environmental Laws, and will obtain, maintain in good order, and comply in all material respects with, all Environmental Permits and registrations, except to the extent any such noncompliance, or failure to
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obtain, or maintain such Environmental Permits or registrations, could not reasonably be expected to have a Material Adverse Effect.
(ii) Upon the written request of the Administrative Agent, the Loan Parties shall submit to the Administrative Agent with sufficient copies for each Lender, at the Loan Parties sole cost and expense, at reasonable intervals, a report providing an update of the status of any environmental, health or safety compliance, hazard or liability issue identified in any notice or report required pursuant to Section 6.1(k) , that could, individually or in the aggregate, result in liability in excess of $3,000,000.
(m) Books, Records and Inspections . Holdings, the Borrower and each of the Borrowers Subsidiaries shall keep books of record and account (including records relating to the Collateral) which accurately reflect all of its business affairs and transactions in relation to its business and activities in all material respects. Holdings, the Borrower and each of the Borrowers Subsidiaries shall permit officers and designated representatives of the Administrative Agent and, if accompanied by the Administrative Agent, each Lender, to visit and inspect any of the properties and operations of Holdings, the Borrower and each of the Borrowers Subsidiaries, and to examine the books of account and other documents of the Borrower and each of the Borrowers Subsidiaries and (at the expense of the Loan Parties) make copies thereof and discuss the affairs, finances and accounts of Holdings, the Borrower and the Borrowers Subsidiaries with, and be advised as to the same by, its and their officers and to interview any of the employees, representatives or agents of Holdings, the Borrower and the Borrowers Subsidiaries regarding environmental compliance, hazard or liability, and its independent auditors, and each Loan Party hereby authorizes its independent auditors to discuss such financial matters with the Administrative Agent or any representative thereof, in each such case, at such reasonable times and intervals, so long as no Event of Default is continuing upon reasonable prior written notice, during regular business hours, and to such reasonable extent as the Administrative Agent may desire (but, so long as no Event of Default is continuing, with the Borrower in attendance for such discussions); provided , however , that, following the occurrence and during the continuation of an Event of Default, the rights of the Administrative Agent and the Lenders may be exercised at any time, with any frequency upon reasonable notice. The Loan Parties agree to pay the reasonable fees of the Administrative Agents auditors incurred in connection with any reasonable exercise of the rights of the Administrative Agent pursuant to this section. Unless an Event of Default shall have occurred and be continuing, the Loan Parties shall only be obligated to pay the fees and expenses of the Administrative Agent and its auditors in respect of one visit and inspection in any calendar year.
(n) Bonding Agreement; Employment Agreements . Holdings and the Borrower will take all action necessary to maintain the Bonding Agreement in full force and effect and will promptly notify the Administrative Agent of any supplement, replacement or amendment thereof. The Borrower will promptly notify the Administrative Agent of any extension, termination or non-renewal of any of the Employment Agreements or of any amendment to any of the material terms thereof.
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(o) Foreign Exchange Hedging . Prior to Holdings, the Borrower or any of the Borrowers Subsidiaries entering into any contract or series of contracts under which the amounts payable to it are payable in whole or in part in the currency of any country other than the United States (a Foreign Currency Contract ) and the amount payable thereunder, when aggregated with the amounts payable under all other Foreign Currency Contracts for such country, exceeds $20,000,000 (on a Dollar equivalent basis), net of the amounts thereafter payable by the Borrower and its Subsidiaries in the currency of such country (on a Dollar equivalent basis) for related services or products, whether under subcontracts or otherwise, as estimated by the Borrower in good faith and with notice to the Administrative Agent prior to Holdings, the Borrower or such Subsidiary of the Borrower entering into such Foreign Currency Contract, and if foreign exchange hedging arrangements are available from a reputable financial institution or through a contract traded on a reputable exchange at a reasonable economic cost, the Borrower or such Subsidiary shall obtain foreign currency hedging arrangements satisfactory in form and substance to the Administrative Agent with respect to the amounts payable under all such Foreign Currency Contracts involving such country. For purposes of this Section 6.1(o) , a foreign exchange hedging arrangement with respect to any currency shall be presumed to be available from a reputable financial institution or through a contract traded on a reputable exchange at a reasonable economic cost, unless (A) the Borrower shall notify the Administrative Agent that it has determined, in good faith, that such a foreign exchange hedging arrangement with respect to such currency is not so available and (B) the Administrative Agent shall have concurred with such conclusion in writing (which concurrence shall not be unreasonably withheld or delayed).
(p) Liens on Collateral . The Liens granted to the Administrative Agent securing the Obligations for the benefit of the Secured Parties shall, as set forth in the Guaranties and Collateral Documents (subject to changes in the Collateral resulting from Dispositions and substitutions of Collateral permitted hereunder pursuant to clause (c) of the definition of Permitted Dispositions and the effect of Recovery Events) for the term of this Agreement be comprised of (i) a first priority lien on equipment of the Borrower and the Guarantors that as of the Closing Date, according to the appraisal performed by Merrill Marine in connection with to the Closing Date, was determined to have an orderly liquidation value ( OLV ) of at least $70,000,000, (ii) a perfected second priority lien on other equipment of the Borrower and the Guarantors that as of the Closing Date, according to the appraisal performed by Merrill Marine immediately prior to the Closing Date was determined to have an OLV of at least $80,000,000 (subject only to Liens permitted by this Agreement and the Liens of Travelers pursuant to the Bonding Agreement) based, in the case of each of clauses (i) and (ii), upon the valuations of Merrill Marine conducted in connection with the Closing Date; (iii) a perfected Lien on all intercompany receivables of the Borrower and the Subsidiary Guarantors having an equal priority to the Liens of the Bonding Company, and having a senior priority to all other Liens; and (iv) by a perfected second priority lien on accounts receivables of the Borrower and the Subsidiary Guarantors arising from projects that are bonded pursuant to the Bonding Agreement (subject only to Liens permitted by this Agreement and the Liens of Travelers pursuant to the Bonding Agreement). In the event that at any time an Event of Default in respect of the financial covenant set forth in Section 6.3(b) shall have occurred and be continuing, within 60 days of the date that the Borrower is required to
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deliver a Compliance Certificate pursuant to Section 6.4(d) for the Fiscal Quarter end for which such the financial covenant set forth in Section 6.3(b) has not been satisfied, the Borrower shall, or shall cause its Subsidiaries to, grant to the Administrative Agent for the benefit of the Secured Parties as security for the Obligations first priority perfected Liens on additional equipment or other assets selected by the Borrower having an OLV as of the date of such grant (based upon a valuation conducted at such time, as provided below) of at least $10,000,000 (subject, but senior to, the second Liens of Travelers on such additional collateral to the extent required by the Intercreditor Agreement), and the Person granting such additional collateral, to effect the grant (and perfection of) such Liens, shall execute Collateral Documents in substantially the same form as the other Collateral Documents then in existence and otherwise in form and substance reasonably satisfactory to the Administrative Agent together with opinions, certificates and other documentation reasonably requested by the Administrative Agent as provided in the Collateral Documents. For the purposes of the immediately preceding sentence, OLV shall be determined by a valuation completed by Merrill Marine, or such other appraiser reasonably satisfactory to the Administrative Agent.
(q) Future Subsidiaries . Upon any Person becoming, after the Closing Date, a Subsidiary of the Borrower, or upon Holdings, the Borrower or any Subsidiary of the Borrower acquiring additional Capital Stock of any existing Subsidiary, the Borrower shall notify the Administrative Agent of such event, and, unless such Subsidiary is organized in a jurisdiction outside the United States of America or otherwise agreed to between the Borrower and the Administrative Agent, (i) such Person shall execute a Loan Party Guaranty and other Collateral Documents in substantially the same forms as the other Loan Party Guaranties and Collateral Documents then in existence and otherwise in form and substance reasonably satisfactory to the Administrative Agent together with opinions, certificates and other documentation reasonably requested by the Administrative Agent in connection with the Collateral Documents (but only to the extent not conflicting with the terms of the Intercreditor Agreement) and (ii) to the extent such Person executes a Loan Party Guaranty, such Person shall become a party to the Contribution Agreement in a manner satisfactory to the Administrative Agent, together, in each case, with such opinions of legal counsel, in form and substance reasonably satisfactory to the Administrative Agent, as the Administrative Agent may reasonably require relating to such Loan Party Guaranty and the Contribution Agreement.
(r) Further Assurances . Each Loan Party agrees that, until all Obligations (other than contingent obligations for which no claim has been, or is reasonably expected to be, made) have been indefeasibly paid and fully satisfied and the Commitments have been terminated, the Administrative Agents security interests in and Liens on and against the Collateral, and all proceeds thereof, shall, subject to Section 8.10 , continue in full force and effect. Each Loan Party shall perform, from time to time, any and all steps reasonably requested by the Administrative Agent to perfect, maintain and protect the Administrative Agents security interests in and Liens on and against the Collateral granted or purported to be granted by the Collateral Documents, as well as the priority of such security interests and Liens, or to enable the Administrative Agent to exercise its rights and remedies hereunder with respect to any Collateral, including (i) executing and filing ship mortgages, financing or continuation statements, or
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amendments thereof, and terminations of ship mortgages, financing statements and other releases, in form and substance reasonably satisfactory to the Administrative Agent, (ii) delivering to the Administrative Agent all instruments representing or evidencing the Collateral duly endorsed and accompanied by duly executed instruments of transfer or assignment, including note powers or allonges, all in form and substance reasonably satisfactory to the Administrative Agent, and (iii) executing and delivering all further instruments and documents, and taking all further action, as the Administrative Agent may reasonably request.
SECTION 6.2. Negative Covenants . Each Loan Party which is a party hereto covenants and agrees that so long as any of the Lenders shall have any Commitment hereunder, there shall exist any outstanding Loans, any Letter of Credit shall remain outstanding, or any other Obligations (other than contingent obligations hereunder for which no claim has been, or is reasonably expected to be, made) shall remain outstanding:
(a) Consolidation, Mergers and Acquisitions . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, liquidate or dissolve, consolidate with, or merge into or with, any other corporation or Person, or purchase or otherwise acquire all or substantially all of the assets of any Person (or of any division thereof) except:
(i) any Subsidiary of the Borrower may liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any Subsidiary Guarantor, and the assets or stock of the Borrower or any of the Borrowers Subsidiaries may be purchased or otherwise acquired by the Borrower or any Subsidiary Guarantor, as the case may be and any Subsidiary that is not a Subsidiary Guarantor may liquidate or dissolve voluntarily into, or merge with and into any other Subsidiary of the Borrower that is not a Subsidiary Guarantor;
(ii) Permitted Business Acquisitions, if permitted (without duplication) by Section 6.2(b)(v) to be made as an Investment;
(iii) Purchases of equipment and related property permitted as Capital Expenditures pursuant to Section 6.3(a); and
(iv) the Acquisition.
(b) Investments . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, make any Investments, except:
(i) Investments existing on the Closing Date, as set forth on Schedule 6.2(b)(i) ;
(ii) Investments that, when made, constituted Customary Permitted Investments;
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(iii) without duplication, Investments permitted as Debt pursuant to Section 6.2(i) and Investments permitted as Guaranties under Section 6.2(f) ;
(iv) without duplication, Investments permitted as Capital Expenditures pursuant to Section 6.3(a) ;
(v) without duplication, Permitted Business Acquisitions to the extent that the aggregate consideration paid (including any assumption of Debt and the fair market value of any non-cash consideration) to make each such acquisition together with the aggregate consideration paid (including any assumptions of Debt and the fair market value of any non-cash consideration) for all other Permitted Business Acquisitions consummated after the Closing Date does not exceed $20,000,000; provided , that any such Permitted Business Acquisition only shall be permitted if after giving effect to such Permitted Business Acquisition (x) the Borrower and its Subsidiaries will be in compliance with each financial covenant ratio set forth in Sections 6.3(b) and (c) as of the most recently ended Fiscal Quarter for which financial statements (and the related compliance certificate) have been delivered pursuant to Section 6.4 after adjusting each such ratio (solely for purposes of this Section 6.2(b)(v)) to make each such ratio .25 to 1.00 more restrictive on the Borrower as of the end of such Fiscal Quarter, and (y) the amount of the aggregate Available Revolving Commitments is not less than $15,000,000;
(vi) (A) loans and advances to employees of the Borrower and its Subsidiaries not to exceed $1,000,000 at any time outstanding to any one employee and not to exceed $2,500,000 in the aggregate at any time outstanding, and (B) advances of payroll payments and expenses to employees in the ordinary course of business; provided , however , that, once made, loans and advances made pursuant to this clause (vi) shall be deemed to remain outstanding except to the extent such loans or advances are repaid in cash without discount;
(vii) accounts receivable arising, and trade credit granted, in the ordinary course of business and any securities received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss, which securities shall not be greater than $4,000,000 in the aggregate;
(viii) (A) Investments by the Borrower in Subsidiary Guarantors and Investments by any Subsidiary of the Borrower in the Borrower or any Subsidiary Guarantor, and (B) Investments (other than in the form of transfers of Collateral) by the Borrower in Subsidiaries of the Borrower which are not Subsidiary Guarantors, and Investments (other than in the form of transfers of Collateral) by any Subsidiary of the Borrower in Subsidiaries of the Borrower which are not Subsidiary Guarantors, provided that, in the case of this clause (B) , the aggregate amount of such Investments made on and after the date hereof shall not exceed $15,000,000;
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(ix) Investments made in connection with the receipt by the Borrower or any of its Subsidiaries of consideration other than cash for the sale by the Borrower or such Subsidiary of any assets permitted to be sold under clause (a) or (c) of the definition of Permitted Disposition;
(x) Investments in joint ventures or partnerships organized and maintained for specific single projects, provided that the amount of such Investments made and maintained does not at any time exceed $20,000,000;
(xi) other Investments in an aggregate amount at any one time not to exceed $10,000,000; provided , however , that, once made, Investments made pursuant to this clause (xi) shall be deemed to remain outstanding except to the extent such Investment is repaid or otherwise returned in cash or in kind (in reasonably equivalent value), without discount;
(xii) Investments in interest rate, foreign exchange and commodity hedges that are entered into in the ordinary course of business and not for any speculative purpose;
(xiii) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with customers and suppliers, in each case in the ordinary course of business;
(xiv) Investments constituting deposits made in the ordinary course consistent with past practice to secure the performance of leases;
(xv) Investments constituting loans to employees of the Borrower and its Subsidiaries to purchase Capital Stock of Holdings not exceeding in the aggregate $5,000,000; and
(xvi) Investments constituting (A) accounts receivable arising, (B) trade debt granted, or (C) deposits made in connection with the purchase price of goods or services, in each case in the ordinary course of business on customary terms.
(c) Restricted Payments . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, declare, pay or make, or offer to pay or make any Restricted Payment (directly or indirectly through any Affiliate) except that so long as no Event of Default exists immediately prior to any Restricted Payment otherwise permitted below or would result therefrom (other than with respect of clauses (ii), (iv), (v) and (vi) below): (i) the Borrower may repurchase, redeem or otherwise acquire shares of, or options to purchase, Capital Stock of Holdings or the Borrower or stock appreciation rights from directors, officers and employees (or their legal representatives or heirs, as the case may be) of the Borrower or any Subsidiary of the Borrower whose employment has terminated or who has died or retired or become disabled, or who has suffered some other hardship and with respect to whom the Board of Directors of the Borrower has otherwise determined to make such a repurchase, redemption or other acquisition in light of such hardship ( provided that in the case of
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such other payments (other than payments made to former employees, officers or directors of Holdings or its Subsidiaries in connection with the repurchase of Capital Stock of Holdings paid by the issuance of a note by the Borrower to such former employee, officer or director, which issuances shall not exceed in outstanding principal amount $5,000,000 in the aggregate) subject to such determination, the aggregate amount of Restricted Payments does not exceed $1,000,000 in any Fiscal Year, and provided further that the aggregate amount of all such repurchases, redemptions and other acquisitions shall not exceed $7,000,000 in the aggregate after the date hereof), or upon the vesting of stock appreciation rights; (ii) any Subsidiary of the Borrower may make Restricted Payments ratably among all of its equity holders; (iii) management fees payable pursuant to a Management Agreement not to exceed $1,000,000 in any Fiscal Year ; (iv) and reimbursement to the Principals of reasonable out-of-pocket expenses relating to Principals management services provided to the Borrower; (v) cash distributions on the Capital Stock of the Borrower to Holdings to pay (A) reasonable and customary board of directors fees and legal, accounting and other administrative expenses (other than management fees) incurred in the ordinary course of business, and (B) taxes owing by Holdings in respect of the Borrower and its Subsidiaries; (vi) payments not exceeding in the aggregate $4,500,000 in the aggregate made pursuant to the put right set forth section 5 of the Shareholders Agreement dated as of April 24, 2001 among the Borrower, Christopher A. Beradi, Joseph A. Beradi and Great Lakes North American Site Developers, Inc., in the form provided to the Arrangers prior to the Closing Date; and (vii) Holdings and the Borrower may make Restricted Payments constituting dividends or distributions on their Capital Stock not to exceed in aggregate for all such dividends or distributions made after the Closing Date the lesser of (A) 75% of the cumulative Net Income attributed to the period beginning on the Closing Date and ending on the last day of the last Fiscal Quarter for which a compliance certificate has been delivered pursuant to Section 6.4(c) and (B) $50,000,000 so long as, after giving effect to each such Restricted Payment (x) the Senior Leverage Ratio of the Borrower and its Subsidiaries does not exceed 1.00 to 1.00, (y) the Total Leverage Ratio of the Borrower and its Subsidiaries does not exceed 3.00 to 1.00 and (z) the amount of the aggregate Available Revolving Commitments is not less than $15,000,000.
(d) Transactions with Affiliates . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, enter into, or cause, suffer or permit to exist any arrangement or contract with any of its other Affiliates unless such arrangement or contract is fair and equitable to Borrower or such Subsidiary and is an arrangement or contract of the kind which would be entered into by a prudent Person in the position of Borrower or such Subsidiary with a Person that is not one of its Affiliates; provided , however , that nothing in this Section 6.2(d) shall prohibit (i) any transactions otherwise permitted hereby pursuant to any Management Agreement or any Tax Sharing Agreement, (ii) any transaction among the Borrower and any Subsidiary Guarantor or (iii) the transaction described on Schedule 6.2(d).
(e) Negative Pledges, etc . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, enter into (or suffer to exist) any agreement prohibiting (i) the creation or assumption of any Lien upon Holdings, the Borrower or such Subsidiarys properties, revenues or assets, whether now owned or
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hereafter acquired; (ii) the ability of the Borrower or any such Subsidiary to amend or otherwise modify this Agreement or any other Loan Document; or (iii) the ability of any of the Borrowers Subsidiaries to make any payments, directly or indirectly, to the Borrower by way of dividends, advances, repayments of loans or advances, reimbursements of management and other intercompany charges, expenses and accruals or other returns on investments, or any other agreement or arrangement which restricts the ability of any such Subsidiary to make any payment, directly or indirectly, to the Borrower other than (A) this Agreement and each Loan Document; (B) agreements existing as of the Closing Date and identified in Schedule 6.2(e) ; (C) agreements governing Debt permitted by clause (ii) of Section 6.2(i) as in effect on the Closing Date, which agreements shall be in form and substance reasonably acceptable to the Administrative Agent; (D) agreements governing Debt permitted by clause (v) of Section 6.2(i) , with any such restrictions being applicable solely to the assets financed with the proceeds of such Debt; (E) the Bonding Agreement, the Intercreditor Agreement, the agreements relating to the Equipment Financing Debt and the Note Indenture; (F) such restrictions or circumstances existing under or by reason of Applicable Laws; and (G) such restrictions or encumbrances existing under or by reason of customary non-assignment provisions in operating leases and licenses of real or personal property (including intellectual property) entered into by any Loan Party or Lessee or Licensee in the ordinary course of business ( provided that such restrictions and encumbrances pertain only to the property that is the subject matter of the applicable lease or leases).
(f) Guaranties . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, create or become or be liable, whether directly or indirectly, with respect to any Guaranty, except that the Borrower or any such Subsidiary may incur (i) Guaranties for the benefit of the Borrower or any such Subsidiary if the primary obligation is permitted by this Agreement, (ii) an unsecured Guaranty by the Borrower of Debt owing by Amboy Aggregates to Fleet Bank, N.A., and each replacement, refinancing and renewal of such Guaranty or guaranteed Debt, in each case so long as the maximum amount of such Guaranty does not exceed $5,000,000 at any time, (iii) Guaranties existing on the Closing Date and described in Schedule 6.2(f) hereto, and the replacement, refinancing and renewal of each such Guaranty which does not increase the amount guaranteed thereunder, (iv) Guaranties of Debt arising under the Bonding Agreement, (v) Guaranties of the Note Indenture Obligations by Subsidiary Guarantors and (vi) a Guaranty by the Borrower of the Debt evidenced by the agreements relating to the Equipment Financing Debt, and (vii) unsecured Guaranties of Debt which, when combined (without duplication) with all unsecured Debt incurred and permitted under clause (xiii) of Section 6.2(i) , do not exceed $10,000,000 at any time outstanding. Notwithstanding the foregoing, no such Guaranty shall be permitted unless after the incurrence of any such Guaranty, there would exist no Default or Event of Default.
(g) Sales of Assets . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, Dispose of any properties or assets (including accounts receivable and Capital Stock or other equity of Subsidiaries), whether now owned or hereafter acquired, or any income or profits therefrom, or enter into any agreement or grant any right or option to do so, in one transaction or a series of transactions, unless such transaction or arrangement (i) constitutes a Permitted
59
Disposition, (ii) consists of a transfer of property among the Borrower and its Subsidiaries permitted under Section 6.2(a) or transfers of property permitted as Investments under Section 6.2(b) , (iii) consists of the lease of equipment (including vessels) by the Borrower or any Subsidiary to Persons which are not Affiliates (other than the Borrower or any Subsidiaries of the Borrower) in the ordinary course of business for a term not exceeding twelve (12) months, or (iv) constitutes a Disposition of accounts receivables arising from projects performed outside of the United States of America or Canada.
(h) Liens, etc . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, create, incur, assume or permit to exist, whether directly or indirectly, any Lien on or with respect to Holdings, the Borrowers or such Subsidiarys properties and assets, whether now or hereafter acquired or upon any income or profits therefrom, except:
(i) Liens granted pursuant to the Loan Documents;
(ii) Customary Permitted Liens;
(iii) Liens existing on the Closing Date and disclosed on Schedule 5.1(g) ;
(iv) Liens securing payment of Debt permitted and described in clause (viii) of Section 6.2(i) ;
(v) Liens securing payment of Debt permitted and described in clause (v) of Section 6.2(i) and covering only those assets acquired, constructed or improved in whole or in part with the proceeds of such Debt;
(vi) Existing Liens on property (other than Collateral) pledged as collateral for liabilities assumed by the Borrower or any Subsidiary of the Borrower in connection with any merger or acquisition permitted by Section 6.2(a) ( provided that such liabilities were not incurred in anticipation of, or to finance, any such merger or acquisition);
(vii) Liens granted to sureties under the Bonding Agreement, to the extent permitted by the Intercreditor Agreement;
(viii) Liens on any property or assets used by the Borrower or any Subsidiary in the ordinary course of business and not constituting Collateral, provided that such Liens existed prior to the acquisition thereof by the Borrower or such Subsidiary and were not created in contemplation of such acquisition;
(ix) Liens securing Obligations under any Rate Protection Agreement, provided that such Lien is granted in favor of a Secured Party or an Affiliate thereof,
60
(x) Leases or subleases (including bareboat charters) of Property other than Collateral by the Borrower or any of its Subsidiaries as lessor or sublessor, provided that such leases and subleases do not interfere in any material respect with the businesses of the Borrower and its Subsidiaries, and are not otherwise prohibited under the other terms of this Agreement, and leases or subleases (including bareboat charters) of Property constituting Collateral, provided that such leases and subleases do not interfere in any material respect with the businesses of the Borrower and its Subsidiaries, are not otherwise prohibited under the other terms of this Agreement, are made in the ordinary course of business and for a term not exceeding nine (9) months, and are expressly subordinated to the Liens contemplated hereby in favor of the Administrative Agent, for the benefit of the Secured Parties;
(xi) Liens securing the Equipment Financing Debt encumbering only the equipment financed (including insurance, requisition, compensation and charters relating thereto and proceeds thereof) with the proceeds of the Equipment Financing Debt;
(xii) renewals or replacements of any of the foregoing, provided that such renewed or replaced Lien does not extend to property other than that which was encumbered by the originally permitted Lien hereunder;
(xiii) Liens arising from precautionary UCC financing statements filed under any lease permitted by this Agreement but only to the extent such Liens pertain to the property that is the subject of such leases;
(xiv) Liens arising by operation of law or by contract in each case encumbering insurance policies and proceeds thereof to secure the financing of premiums payable under such policies;
(xv) customary rights of set-off, revocation, revocation, refund, or charge back under deposit agreements or under the UCC of banks or other financial institutions in respect of charges relating to deposit accounts and returned items (but not in respect of Debt generally);
(xvi) Liens pursuant to a purchase agreement or sale agreement securing the obligations under such purchase agreement or sale agreement and encumbering solely the assets that are to be sold in any asset disposition permitted by this Agreement;
(xvii) Liens on accounts receivables for which attempts at collection have been undertaken by a third party (provided that the face amount of such accounts receivables subject to such Lien shall not exceed $2,500,000 in the aggregate at any time); and
(xviii) such other Liens with respect to which neither the Debt secured by such Lien nor the fair market value of the property subject to such Liens exceed in the aggregate for all such Liens $3,000,000.
61
provided , however , that notwithstanding the foregoing, in no event shall any contractual Liens be permitted to exist on any common stock of or other equity interests in the Borrower or any of the Borrowers Subsidiaries which is wholly-owned by Holdings or any of its Subsidiaries.
(i) Debt . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, create, incur, assume or otherwise become or remain liable with respect to any Debt, other than, without duplication, the following:
(i) Debt in respect of the Loans and other Obligations;
(ii) Debt, including Debt in respect of Guaranties, existing on the Closing Date, as set forth on Schedule 6.2(i) , and (except as may otherwise be restricted by Sections 6.2(c) or 6.2(o) ) any renewal, extension, refinancing or replacement thereof so long as (A) the terms of any such renewal, extension, refinancing or replacement are not materially less favorable to such Loan Party than the original Debt, (B) the then aggregate outstanding amount of such Debt at the time of such renewal, extension, refinancing or replacement, as the case may be, is not increased, and (C) the average life to maturity of such Debt at the time of such renewal, extension, refinancing or replacement, as the case may be, is not decreased thereby;
(iii) unsecured Debt incurred in the ordinary course of business of the Borrower and its Subsidiaries in the nature of open accounts (extended by suppliers on normal trade terms in connection with purchases of goods and services), accrued liabilities and deferred income, taxes and judgments or orders for the payment of money to the extent such judgments or orders do not result in any Event of Default or result in any Liens prohibited by Section 6.2(h) ;
(iv) unsecured Debt of the Borrower or any of its Subsidiaries owing to one another, provided that all such Debt owing to the Borrower or to any Subsidiary Guarantor shall be evidenced by one or more promissory notes, in form and substance reasonably acceptable to the Administrative Agent, which promissory notes shall be pledged to the Administrative Agent pursuant to the Note Pledge Agreement;
(v) Capitalized Rentals (to the extent permitted by Section 6.3(a) ) or purchase money Debt incurred by the Borrower or any of its Subsidiaries to any Person to finance the acquisition, construction, repair or improvement of assets permitted to be acquired, constructed, repaired or improved pursuant to Section 6.3(a) , including any such Debt incurred after the acquisition, construction, repair or improvement of such assets, so long as, in each case, the amount of such Debt does not exceed 100% and is not less than 50% of the purchase price, construction cost, repair cost or improvement cost of the assets acquired, constructed, repaired or improved with the proceeds thereof and, in the case of Debt incurred after the acquisition, construction, repair or improvement of
62
the assets to be financed, such Debt is incurred no later than twelve calendar months after such assets are acquired, constructed, repaired or improved;
(vi) Debt incurred in connection with any Rate Protection Agreement;
(vii) Debt of Subsidiaries of the Borrower which represents the assumption by such Subsidiaries of Debt of another Subsidiary of the Borrower in connection with the merger of such other Subsidiary with and into the assuming Subsidiary or the purchase of all or substantially all the assets of such other Subsidiary;
(viii) Debt (contingent or otherwise) for the reimbursement of the surety or sureties which issue (A) license, bid, performance and lien, and payment bonds under the Bonding Agreement for amounts expended by them in the performance of such bonds, and (B) bonds issued pursuant to the Bonding Agreement with respect to projects in a country other than the United States which are used to obtain letters of credit, financial guaranties or other bonds under which Holdings or a Subsidiary of Holdings is the primary obligor provided that , the aggregate amount of the Debt permitted by this subclause (B) shall not exceed $25,000,000 at any time outstanding;
(ix) Guaranties permitted under Section 6.2(f) ;
(x) Debt constituting Note Indenture Obligations pursuant to the terms of the Note Indenture, in an aggregate principal amount not to exceed $175,000,000;
(xi) Debt in respect of taxes, assessments, governmental charges and claims for labor, materials or supplies, to the extent that payment thereof is not required pursuant to Section 6.1(e) ;
(xii) all premiums (if any), interest (including post-petition interest), fees, expenses, indemnities, charges and additional or contingent interest on obligations described in clauses (i) through (xv) of this Section 6.2(i) ;
(xiii) other unsecured Debt of the Borrower and its Subsidiaries which when combined (without duplication) with all unsecured Guaranties incurred and permitted under clause (vii) of Section 6.2(f) , does not exceed $10,000,000 at any time outstanding;
(xiv) Equipment Financing Debt not exceeding $23,400,000 in aggregate principal amount at any time outstanding; and
(xv) unsecured Debt used to repurchase Capital Stock of Holdings from former employees not to exceed in the aggregate $5,000,000.
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Any Person which becomes a Subsidiary after the Closing Date shall for all purposes of this Section 6.2(i) be deemed to have created, assumed or incurred, at the time it becomes a Subsidiary, all Debt of such Person existing immediately after it becomes a Subsidiary.
(j) ERISA . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to (i) engage, nor shall the Borrower or any of its Subsidiaries permit any ERISA Affiliate to engage, in any prohibited transaction described in Section 406 of ERISA or Section 4975 of the IRC for which a statutory or class exemption is not available or a private exemption has not been previously obtained from the DOL; (ii) permit to exist any accumulated funding deficiency (as defined in Section 302 of ERISA and Section 412 of the IRC), whether or not waived; (iii) fail, or permit any ERISA Affiliate to fail, to pay timely required contributions or annual installments due with respect to any waived funding deficiency to any Plan; (iv) terminate, or permit any ERISA Affiliate to terminate, any Plan which would result in any liability of the Borrower or any ERISA Affiliate, or the imposition of any Lien on their respective property, under Title IV of ERISA; (v) fail to make any contribution or payment to any Multiemployer Plan which the Borrower or any ERISA Affiliate is required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto; (vi) fail, or permit any ERISA Affiliate to fail, to pay any required installment or any other payment required under Section 412 of the IRC on or before the due date for such installment or other payment; or (vii) amend, or permit any ERISA Affiliate to amend, a Plan resulting in an increase in current liability for the plan year such that the Borrower or any ERISA Affiliate is required to provide security to such Plan under Section 401 (a)(29) of the IRC; provided , however , that no act, omission or event specified in clause (i) through (vii) shall be considered a violation of this Section 6.2(j) unless such act, omission or event could reasonably be expected to have a Material Adverse Effect.
(k) Conduct of Business; Holdings a Passive Holding Company . (i) The Borrower shall not, and shall not permit any of its Subsidiaries to, engage in any business or activity other than (A) the businesses of dredging, aggregate mining and supply, towing services, marine construction, dredging reclamation activities and demolitions; and (B) any businesses or activities reasonably related, complimentary or incidental thereto, or the commercial and industrial demolition business.
(ii) Notwithstanding anything to the contrary in this Agreement or any other Loan Document, Holdings shall not (A) conduct, transact or otherwise engage in, or commit to conduct, transact or otherwise engage in, any business or operations other than those incidental to its ownership of the Capital Stock of the Borrower, (B) incur, create, assume or suffer to exist any Debt, except (1) nonconsensual obligations imposed by operation of law, (2) pursuant to the Loan Documents to which it is a party and (3) obligations with respect to its Capital Stock, or (C) own, lease, manage or otherwise operate any properties or assets (including cash (other than cash received in connection with dividends made by the Borrower in accordance with Section 6.2(c) pending application in the manner contemplated by said Section) and cash equivalents) other than the ownership of shares of Capital Stock of the Borrower.
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(l) Sales and Leasebacks . Except for transactions described in clause (b) of the definition of Permitted Disposition or permitted pursuant to Section 6.2(i)(v), neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, become liable, directly or by way of any Guaranties, with respect to any lease of any property (whether real or personal or mixed) whether now owned or hereafter acquired, (i) which any Loan Party has sold or transferred or is to sell or transfer to any other Person, or (ii) which any Loan Party intends to use for substantially the same purposes as any other property which has been or is to be sold or transferred by that entity to any other Person in connection with such lease.
(m) Margin Regulation . Neither Holdings nor the Borrower shall, nor shall they permit any other Person to, use any portion of the proceeds of any credit extended under this Agreement in any manner which might cause the extension of credit or the application of such proceeds to violate the 1933 Act or the 1934 Act (each as amended to the Closing Date and from time to time thereafter, and any successor statute) or to violate Regulation U, or Regulation X, or any other regulation of the Federal Reserve Board, in each case as in effect on the date or dates of such extension of credit and such use of proceeds.
(n) Lease Obligations . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, enter into any operating lease (which is not a Capitalized Lease) with respect to any real or personal property (or any interest therein), except (i) operating leases which, together with all other such arrangements (excluding those described in clauses (ii) and (iii) below) which shall then be in effect, will not require the payment of an aggregate amount of rentals by the Borrower and its Subsidiaries (determined on a consolidated basis) in excess of $20,000,000 for any Fiscal Year, (ii) operating leases for not more than one year and (iii) operating leases in connection with the performance of specific projects for the period of such projects; provided , however , that any calculation made for purposes of this section shall exclude any amounts required to be expended for maintenance, repairs, insurance, taxes, assessments, and other similar charges.
(o) Modification of Material Agreements and Documents . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, consent to any amendment, supplement or other modification of any terms or provisions contained in, or applicable to (i) the Bonding Agreement or any agreement relating thereto that is either material or related to the creation, attachment or perfection of a security interest in any collateral securing the obligations under the Bonding Agreement or the Equipment Financing Debt, in each case in any manner materially adverse to the Borrower or the rights or interests of the Secured Parties under the Loan Documents, (ii) its certificate or articles of incorporation, by-laws or other organizational documents in any manner materially adverse to the rights or interests of the Secured Parties under the Loan Documents, or (iii) the Acquisition Agreement in any manner materially adverse to the rights or interests of the Secured Parties under the Loan Documents or the Note Indenture (other than modifications of the Note Indenture pursuant to the terms of Section 9.01 thereof).
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(p) Change of Location or Name . None of the Loan Parties shall change (i) the location of its principal place of business, chief executive office, major executive office, jurisdiction or organization, chief place of business or its records concerning its business and financial affairs; or (ii) its name or the name under or by which it conducts its business, in each case without giving the Administrative Agent written notice thereof promptly upon the effectiveness of such name change (and in any event no later than 30 days after the effectiveness of such name change) and taking any and all actions which may be reasonably necessary or desirable, or which the Administrative Agent may reasonably request, to maintain and preserve all Liens in favor of the Administrative Agent granted pursuant to the Collateral Documents; provided that notwithstanding the foregoing, none of the Loan Parties shall change the location of its principal place of business, chief executive office, chief place of business or its records concerning its business and financial affairs from the contiguous continental United States of America to any place outside the contiguous continental United States of America.
(q) Take or Pay Contracts . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, enter into or be a party to any arrangement for the purchase of materials, supplies, other property or services if such arrangement by its express terms requires that payment be made by Holdings, the Borrower or such Subsidiary regardless of whether such materials, supplies, other property or services are delivered or furnished to it; provided , however , Holdings and the Borrower may, and may permit their respective Subsidiaries to, enter into such arrangements which are incidental to its business and not entered into for speculation.
(r) Use of Proceeds . Neither Holdings nor the Borrower shall, nor shall they permit any of the Borrowers Subsidiaries to, directly or indirectly use or apply any of the proceeds of any Loans in a manner inconsistent with the provisions of Section 2.21.
(s) Certain Collateral Matters . Notwithstanding anything set forth in this Section 6.2 , no Loan Party shall Dispose of any Collateral (other than in a Permitted Disposition described in clause (c) of the Definition of Permitted Disposition) or shall consummate any transaction otherwise not prohibited by this Section 6.2 , if such Disposition or transaction would result in any modification of the existence, perfection or priority of any Lien on Collateral in favor of the Administrative Agent, for the benefit of the Secured Parties (as set forth in Section 6.1(p) ), in any manner adverse to the interests of the Secured Parties. Any transaction that would be otherwise be permitted under this Section 6.2 but for the immediately preceding sentence, shall be permitted so long as, prior to the consummation of such Disposition or transaction, the Loan Parties (and any other Person receiving such Collateral) perform any and all steps reasonably requested by the Administrative Agent to perfect, maintain and protect the Administrative Agents security interests in and Liens on and against the Collateral granted or purported to be granted by the Collateral Documents, as well as the priority of such security interests and Liens, or to enable the Administrative Agent to exercise its rights and remedies hereunder with respect to any Collateral.
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SECTION 6.3 . Financial Covenants . The Borrower covenants and agrees that so long as the Lenders shall have any Commitment hereunder, any Letter of Credit shall remain outstanding, or any other Obligation (other than contingent obligations hereunder for which no claim has been, or is reasonably expected to be, made) shall remain outstanding:
(a) Capital Expenditures . The Borrower and its consolidated Subsidiaries shall not make or permit Capital Expenditures in an aggregate amount in excess of $22,000,000 during any Fiscal Year commencing with Fiscal Year 2004 (with respect to any such Fiscal Year, the Base Capital Expenditure Amount ); provided , however , that the Base Capital Expenditure Amount for any Fiscal Year after Fiscal Year 2004 may be increased by (A) an amount equal to the excess, if any, of (i) the Base Capital Expenditure Amount for the immediately preceding Fiscal Year, over (ii) the actual amount of Capital Expenditures made by the Borrower and its Subsidiaries during such immediately preceding Fiscal Year; plus (B) the amount of Capital Expenditures permitted in the immediately succeeding Fiscal Year ( provided that the Base Capital Expenditure Amount for such succeeding Fiscal Year shall be reduced by the amount of any increase pursuant to this Clause (B); and provided , further , that in no event shall the amount of Capital Expenditures made by the Borrower and its consolidated Subsidiaries in any Fiscal Year exceed $26,000,000).
(b) Maximum Total Leverage . The Borrower and its consolidated Subsidiaries shall not permit the ratio (the Total Leverage Ratio ) of (i) the aggregate unpaid principal amount of Total Funded Debt as of the last day of any Fiscal Quarter ending during the periods described below to (ii) Adjusted Consolidated EBITDA for the four (4) consecutive Fiscal Quarter period ending as of such date, to exceed the corresponding ratio set forth below opposite such period:
Period |
|
Ratio |
|
|
|
|
|
December 31,
2003 through and
|
|
5.75 to 1.00 |
|
|
|
|
|
January 1,
2005 through and
|
|
5.50 to 1.00 |
|
|
|
|
|
January 1, 2006 through and including December 31, 2006 |
|
5.00 to 1.00 |
|
|
|
|
|
January 1,
2007 through and
|
|
4.75 to 1.00 |
|
|
|
|
|
January 1,
2008 through and
|
|
4.50 to 1.00 |
|
|
|
|
|
January 1,
2009 through and
|
|
4.00 to 1.00 |
|
|
|
|
|
January 1, 2010 and thereafter |
|
3.50 to 1.00 |
|
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(c) Maximum Senior Leverage . The Borrower and its consolidated Subsidiaries shall not permit the ratio (the Senior Leverage Ratio ) of (i) the aggregate unpaid principal amount of Senior Debt as of last day of any Fiscal Quarter ending during the periods described below to (ii) Adjusted Consolidated EBITDA for the four (4) consecutive Fiscal Quarter period ending as of such date, to exceed the corresponding ratio set forth below opposite such period:
Period |
|
Ratio |
|
|
|
|
|
December 31,
2003 through and
|
|
2.50 to 1.00 |
|
|
|
|
|
January 1,
2005 through and
|
|
2.25 to 1.00 |
|
|
|
|
|
January 1,
2006 through and
|
|
2.00 to 1.00 |
|
|
|
|
|
January 1,
2007 through and
|
|
1.75 to 1.00 |
|
|
|
|
|
January 1,
2008 through and
|
|
1.50 to 1.00 |
|
|
|
|
|
January 1, 2009 and thereafter |
|
1.25 to 1.00 |
|
(d) Interest Coverage Ratio . The Borrower and its consolidated Subsidiaries shall not permit the ratio of (i) Adjusted Consolidated EBITDA for any four (4) consecutive Fiscal Quarter period ending as of the last day of any Fiscal Quarter ending during the period described below to (ii) Interest Expense, in each case for the four (4) consecutive Fiscal Quarter period ending as of such date, to be less than the corresponding ratio set forth below opposite such period:
Period |
|
Ratio |
|
|
|
|
|
December 31, 2003 through and
|
|
1.75 to 1.00 |
|
|
|
|
|
January 1, 2005 through and
|
|
2.00 to 1.00 |
|
|
|
|
|
January 1, 2006 through and
|
|
2.00 to 1.00 |
|
|
|
|
|
January 1, 2007 through and
|
|
2.25 to 1.00 |
|
|
|
|
|
January 1, 2009 through and thereafter |
|
2.50 to 1.00 |
|
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SECTION 6.4 . Financial Reporting . The Borrower covenants and agrees that so long as any of the Lenders shall have any Commitment hereunder, there shall exist any outstanding principal under any Loans, any Letter of Credit shall remain outstanding, or any other Obligation (other than contingent obligations hereunder for which no claim has been, or is reasonably expected to be, made) shall remain outstanding:
(a) System of Accounting . Holdings and the Borrower shall maintain the percentage-of-completion accounting policies relative to change orders and work-in-progress as in effect on the Closing Date and shall in any event maintain a system of accounting established and administered in accordance with sound business practices to permit preparation of financial statements in conformity with GAAP (except as may be otherwise required pursuant to Section 1.4 ), and each of the financial statements described below shall be prepared from such system and records.
(b) Quarterly Reports . The Borrower shall provide the Administrative Agent within 45 days after the end of each of the first three Fiscal Quarters of each Fiscal Year, unaudited consolidated and consolidating balance sheets of the Borrower and its Subsidiaries as of the end of such Fiscal Quarter and unaudited consolidated and consolidating statements of earnings and consolidated statements of cash flow of the Borrower and its Subsidiaries for such Fiscal Quarter and for the period commencing at the end of such Fiscal Quarter, certified on behalf of the Borrower by an Authorized Officer of the Borrower.
(c) Annual Reports . The Borrower shall provide to the Administrative Agent, within 90 days after the end of each Fiscal Year, a copy of the annual audit report for such Fiscal Year for the Borrower and its Subsidiaries, including therein consolidated (and unaudited consolidating) balance sheets of the Borrower and its Subsidiaries as of the end of such Fiscal Year and consolidated (and unaudited consolidating) statements of earnings and cash flow of the Borrower and its Subsidiaries for such Fiscal Year by Deloitte & Touche or other independent public accountants reasonably acceptable to the Administrative Agent, together with such accountants opinion, which shall not be subject to any Impermissible Qualification, and a certificate from such accountants containing a computation of, and showing compliance with, each of the financial ratios and restrictions contained in Section 6.3 and to the effect that, in making the examination necessary for the signing of such annual report by such accountants, they have not become aware of any Default or Event of Default in respect of the financial covenants set
69
forth in Section 6.3 that has occurred and is continuing, or, if they have become aware of such Default or Event of Default in respect of the financial covenants set forth in Section 6.3 , describing such Default or Event of Default.
(d) Compliance Certificate . The Borrower shall provide to the Administrative Agent, within 45 days after the end of each of the first three Fiscal Quarters of each Fiscal Year and within 90 days after the end of the last Fiscal Quarter of each Fiscal Year, (i) a certificate substantially in the form of Exhibit G (the Compliance Certificate ), executed on behalf of the Borrower by the Authorized Officer who is the chief financial officer, treasurer, assistant treasurer or controller of the Borrower, showing (in reasonable detail and appropriate calculations and computations in form reasonably satisfactory to the Administrative Agent) compliance with the financial covenants set forth in Section 6.3 , (ii) a backlog schedule and a schedule of all work-in-progress, identified by contract or project, of the Borrower and its Subsidiaries for the performance of dredging, construction or other services, prepared in a manner consistent with past practice, (iii) notice of the occurrence of any Permitted Disposition or any Permitted Business Acquisition, describing, in detail reasonably satisfactory to the Administrative Agent, the assets sold or disposed of or the assets acquired and the purchase price or sale price thereof, as the case may be, during the preceding Fiscal Quarter, (iv) notice of the receipt of any sales proceeds, insurance or requisition proceeds or condemnation awards received in connection with the sale, damage, destruction, requisition or condemnation of any Collateral during the preceding Fiscal Quarter, including a statement with regard to whether the Borrower or such Subsidiary intends to apply such sales proceeds, insurance or requisition proceeds or awards, as the case may be, to replace, within one year of receipt thereof, such sold, damaged, destroyed, requisitioned or condemned assets or property Collateral used for substantially the same purpose as those sold, damaged, destroyed, requisitioned or condemned and (v) notice of any (A) voluntary liquidation or dissolution by any Subsidiary of the Borrower into the Borrower or another Subsidiary of the Borrower, (B) merger by any such Subsidiary with and into the Borrower or another Subsidiary of the Borrower or (C) the purchase by the Borrower or any of its Subsidiaries of any Capital Stock of any other Subsidiary of the Borrower during the preceding Fiscal Quarter.
(e) Budget . The Borrower shall deliver to the Administrative Agent, within 75 days after the end of each Fiscal Year, a budget for the next succeeding Fiscal Year, which budget shall be prepared on a Fiscal Quarter basis and shall contain a projected, consolidated balance sheet, consolidated statement of earnings (broken out in reasonable detail by business segment) and a consolidated statement of cash flow of the Borrower and its Subsidiaries for such succeeding Fiscal Year. It is understood that (i) any projections or budget furnished to the Administrative Agent or any Lender are subject to significant uncertainties and contingencies, which are beyond the control of the Borrower and its Subsidiaries, (ii) no assurance is given by the Borrower and its Subsidiaries that such projections will be realized, and (iii) the actual results may differ from such projections and such differences may be material.
(f) Securities Reports . With reasonable promptness after the sending or filing thereof, the Borrower shall deliver to the Administrative Agent copies of all
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reports and registration statements which the Borrower or any of its Subsidiaries files with the Securities and Exchange Commission or any national securities exchange.
(g) Vessels . The Borrower shall deliver to the Administrative Agent, within ninety (90) days after the end of each Fiscal Year, a certificate of an Authorized Officer of the Borrower listing all Designated Vessels.
(h) Other Information . With reasonable promptness, Holdings and the Borrower shall deliver such other data and information (including, without limitation, intercompany loan and advance balances among the Borrower and each of its Subsidiaries) as the Administrative Agent or a Lender through the Administrative Agent shall reasonably request.
(i) Delivery of Financial Information to the Lenders . The Administrative Agent shall promptly deliver to each Lender a copy of the financial information delivered to the Administrative Agent by the Borrower pursuant to Section 6.4 .
(j) New Subsidiaries . As soon as practicable after the end of the Fiscal Quarter ending on or about December 31, 2003 and each Fiscal Quarter thereafter, the Borrower shall provide the Administrative Agent with an updated Schedule 5.1(r) containing all of the information which would be required to be included in such schedule pursuant to Section 5.1 if such schedule were to be made true and complete as of the last day of such Fiscal Quarter (including, without limitation, information with respect to any newly acquired or created Subsidiaries); provided , however , that, no such updated schedule need be delivered to the Administrative Agent if the schedule which has been then most recently delivered to the Administrative Agent pursuant to this section (or attached to this Agreement as Schedule 5.1(r) ) remains true and complete in all material respects as of the last day of such Fiscal Quarter.
ARTICLE VII
.
EVENTS OF DEFAULT; REMEDIES
SECTION 7.1 . Events of Default . Each of the following occurrences shall constitute an Event of Default under this Agreement:
(a) Failure to Make Payments When Due . Any Loan Party shall fail to pay on the date when due (i) any principal of any Loan or Reimbursement Obligation or (ii) any interest or fees under the Loan Documents or any other Obligations and such failure shall continue for five (5) Business Days.
(b) Breach of Covenants .
(i) Any Loan Party shall fail duly and punctually to perform or observe any covenant or agreement binding on such Loan Party under Section 6.l(a) , (f) or (m) , Section 6.2 or Section 6.3 of this Agreement.
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(ii) Any Loan Party shall fail duly and punctually to perform or observe any covenant or agreement binding on such Loan Party under Section 6.1(c)(ii) , (d) , (i) , (j) , or Section 6.4 of this Agreement, and such failure shall continue unremedied for ten (10) Business Days (or in the case of Section 6.1(j) , three (3) Business Days) after an officer of such Loan Party first has knowledge of such failure or such Loan Party receives written notice thereof from the Administrative Agent, whichever is earlier.
(iii) Any Loan Party shall fail duly and punctually to perform or observe any covenant or agreement binding on such Loan Party under this Agreement (other than as provided in subsection (a) above or in clause (i) or (ii) of this subsection (b) ) or under any of the other Loan Documents, and such failure shall continue unremedied for thirty (30) days after an Authorized Officer first has knowledge of such failure or such Loan Party receives written notice thereof from the Administrative Agent, whichever is earlier.
(c) Incorrect Representation or Warranty . Any representation or warranty made by any Loan Party or any officer of any Loan Party under this Agreement, any other Loan Document or any amendment, waiver or modification of any of the terms thereof shall prove to have been incorrect or misleading when made in any material respect.
(d) Default as to Other Debt . Default in the payment when due subject to any applicable grace period (whether by scheduled maturity, required prepayment, required redemption, acceleration, demand or otherwise) on any Debt (other than the Obligations), individually or in the aggregate, having an outstanding principal amount in excess of $5,000,000, of or guaranteed by, any Loan Party or Subsidiary of Holdings; or any breach, default or event of default shall occur, or any other event shall occur or condition shall exist, under any instrument, agreement or indenture pertaining thereto, if the effect thereof, after giving effect to any applicable grace or cure period, is to accelerate, or permit the holder(s) of such Debt to accelerate the maturity of such Debt, or require a mandatory redemption or repurchase of such Debt prior to its scheduled redemption or repurchase; or any such Debt shall be declared due and payable or required to be prepaid (other than by a regularly scheduled required prepayment), repurchased or redeemed prior to the originally stated maturity thereof; or the holder of any Lien related to a Debt in excess of $5,000,000 shall commence foreclosure of such Lien; or an Event of Default shall have occurred under and as defined in the Travelers Agreement after giving effect to any applicable cure periods and any waivers thereof; or an Event of Default shall have occurred under and as defined in Section 6.01 of the Note Indenture.
(e) Bankruptcy .
(i) Any Loan Party or Subsidiary of the Borrower shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or
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(ii) any proceeding shall be instituted by or against any Loan Party or Subsidiary of the Borrower seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation (other than in a transaction permitted under Section 6.2(a)(i) ), winding up, reorganization, arrangement, adjustment, protection, relief or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or seeking the entry of an order for relief or the appointment of a receiver, trustee or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it), either such proceeding shall remain undismissed, undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days, or any of the actions sought in such proceeding (including the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or any substantial part of its property) shall occur; or
(iii) any Loan Party or Subsidiary of the Borrower shall take any corporate action pursuant to a resolution or consent of its board of directors or shareholders to authorize any of the actions set forth in this Section 7.1(e) .
(f) Judgments and Attachments . Any final judgment (or judgments) or money judgment (or judgments), writ or warrant of attachment, or similar process involving in excess of $5,000,000 (to the extent not covered by insurance which is confirmed in writing by the insurers or agents of Holdings, the Borrower or any of their respective Subsidiaries as covering such judgment or process) in the aggregate shall be entered or filed against any Loan Party or Subsidiary of the Borrower or any of their respective assets and either (1) shall remain undischarged, unpaid, unvacated, unbonded or unstayed for a period of thirty (30) days from the date of its entry, or (2) there shall be any period of thirty (30) consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect.
(g) ERISA Termination Event . Any Termination Event occurs which the Majority Lenders reasonably believe could have a Material Adverse Effect.
(h) ERISA Waiver . If the plan administrator of any Plan applies under Section 412(d) of the IRC for a waiver of the minimum funding standards of Section 412(a) of the IRC and the Majority Lenders reasonably believe that the business hardship upon which the application for such waiver is based could have a Material Adverse Effect.
(i) Termination of Documents; Failure of Security . Any of the Loan Documents shall cease for any reason (other than by reason of any action or inaction by the Administrative Agent or any Lender) to be in full force and effect against any Loan Party (other than in accordance with the terms hereof or thereof), or any Loan Party shall disavow its obligations under, or shall contest the validity or enforceability of, any of the Loan Documents or the Obligations, or any material Lien intended to be created thereby ceases to be or is not valid and perfected in any material respect; or any such Lien shall
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be subordinated or shall not have the priority contemplated by this Agreement, any of the other Loan Documents, for any reason, or any Loan Party or Affiliate thereof shall institute any action seeking a determination of any of the foregoing, or the subordination provisions of the Note Indenture shall fail to be in full force and effect.
(j) Change in Control . Any of the following events occur:
(i) (A) prior to an initial public offering of the Voting Stock of the Borrower or any Person which directly or indirectly owns all of outstanding Voting Stock of the Borrower or at any other time when such Voting Stock is not traded on a national securities exchange, the failure of one or more Principals (1) to own, directly or indirectly, at least 51% of the Voting Stock of the Borrower, determined on a fully diluted basis and (2) to have the power to direct or cause the direction of the management or policies of Borrower or (B) following such initial public offering and at any time the Voting Stock of the Borrower or any Person which directly or indirectly owns all of outstanding Voting Stock of the Borrower is traded on a national securities exchange, the failure of the Principals or any direct or indirect wholly-owned Subsidiary of the Principals (individually or in the aggregate) to own, directly or indirectly, less than 40% of the Voting Stock of the Borrower, determined on a fully-diluted basis, and a Person (other than a Principal) owns a greater percentage of such Voting Stock, determined on a fully-diluted basis; or
(ii) the failure of the Borrower (A) to own (directly or indirectly), free and clear of all Liens or other encumbrances (other than any Lien or encumbrance created by the Loan Documents), 100% of the outstanding shares of each class of Capital Stock of any Subsidiary Guarantor on a fully diluted basis, or, in the case of NASDI, at least 75% of the outstanding equity capital, or 100% of the outstanding Voting Stock, of NASDI, or (B) to have the power (directly or indirectly) to direct or cause the direction of the management or policies of any such Subsidiary Guarantor; or
(iii) a majority of the Board of Directors of the Borrower are not Continuing Directors; or
(iv) any Change of Control (as defined in the Note Indenture) occurs.
(k) Bonding Agreement .
(i) Any Person executing bonds, undertakings or instruments of guaranty as surety for Holdings, the Borrower or any of their respective Subsidiaries with respect to any marine construction or dredging contracts to be entered into by the Borrower or any such Subsidiary for any reason ceases to issue such bonds, undertakings or instruments of guaranty and such denial, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect; or
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(ii) Travelers provides notice to the Administrative Agent (pursuant to Section 4.4 of the Intercreditor Agreement) of any breach or default under any bonded contract or under the Travelers Agreement and, as a result thereof, Travelers has taken action pursuant to Section 4.1(a) of the Intercreditor Agreement; or
(iii) The Borrower or any of its Subsidiaries defaults in the payment when due of any amount due under the Bonding Agreement or breaches or default with respect to any other term of the Bonding Agreement, if the effect of such failure to pay, default or breach is to cause any Person executing bonds, undertakings or instruments of guaranty as surety for the Borrower or any of its Subsidiaries to take possession of the work under any of the bonded contracts of the Borrower or any of its Subsidiaries and such possession could reasonably be expected to result in a Material Adverse Effect; or
(iv) Any Loan Party breaches or defaults with respect to any term under any of the bonded contracts of such Loan Party, if the effect of such default or breach is to cause any Person executing bonds, undertakings or instruments of guaranty as surety for such Loan Party to take possession of the work under such bonded contract and such possession could reasonably be expected to result in a Material Adverse Effect.
SECTION 7.2 . Acceleration . Upon the occurrence of any Event of Default described in clause (ii) or (iii) of Section 7.1(e) , the Commitments shall each automatically and immediately terminate and all unpaid Obligations shall automatically become immediately due and payable, without presentment, demand, or protest or other requirements of any kind (including valuation and appraisement diligence, presentment, notice of intent to demand or accelerate and of acceleration), all of which are hereby expressly waived by the Borrower, and the obligation of each Lender to make any Loan and of the Issuing Lenders to issue and of the Lenders to participate in any Letter of Credit hereunder shall thereupon terminate; and upon the occurrence and during the continuance of any other Event of Default, the Administrative Agent may, and at the direction of the Majority Lenders, shall, by written notice to the Borrower, immediately terminate the Commitments and/or declare all of the Obligations of the Borrower to be, and the same shall forthwith become, immediately due and payable together with accrued interest thereon, and the obligation of each Lender to make any Loan and of the Issuing Lenders to issue and of the Lenders to participate in any Letter of Credit hereunder shall thereupon terminate. In addition to and not in limitation of any other right available to the Lenders under any of the Loan Documents or otherwise at law or equity, upon the giving of such notice by the Administrative Agent, the Borrower shall be required to deposit immediately with the Administrative Agent for the benefit of the Lenders, in immediately available funds, an amount equal to the Letter of Credit Obligations (the Deposit ). The Borrowers obligation to pay the Deposit shall be absolute and unconditional, and the Deposit shall be deposited in a special collateral account with the Administrative Agent to ensure reimbursement of any drawings under such Letters of Credit and payment of all other amounts due and payable under any of the Loan Documents regarding the Letters of Credit.
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SECTION 7.3 . Injunctive Relief . Each of Holdings and the Borrower recognizes that in the event the Borrower fails to perform, observe or discharge any of its Obligations, any remedy of law may prove to be inadequate relief to the Administrative Agent or any Lender, therefore each of Holdings and the Borrower agrees that the Administrative Agent and each Lender, if the Administrative Agent or such Lender so requests, shall be entitled to temporary and permanent injunctive relief during the continuation of an Event of Default in any such case without the necessity of proving actual damages or inadequacy of damages as an available remedy therefor.
SECTION 7.4 . Allocation Among Secured Parties . Following the occurrence of an Event of Default, and notwithstanding anything in this Agreement to the contrary, all payments, and collections with respect to proceeds of Collateral and all other payments and other applications otherwise on account of any of the Obligations, shall be applied to the Obligations which are then due and payable and if such payments and proceeds are insufficient to satisfy all such Obligations which are due and payable, such payments and proceeds shall be applied in the following order in each case ratably among such Obligations: (i) to the payment of all amounts then due with respect to reasonable out-of-pocket fees (including Attorney Costs), charges, expenses and indemnity claims due the Administrative Agent, (ii) to the payment of all other amounts then due with respect to reasonable out-of-pocket fees (including Attorney Costs), charges, expenses and indemnity claims due the other Secured Parties, (iii) to the payment of amounts then due with respect to interest on the Loans, (iv) to the payment of amounts then due with respect to principal of the Loans and Reimbursement Obligations (and to the extent Letter of Credit Obligations are contingent, cash collateral with respect thereto), and amounts then due the Secured Parties with respect to Rate Protection Agreements and (v) to the payment of all other Obligations.
ARTICLE VIII
.
THE ADMINISTRATIVE AGENT
SECTION 8.1 . Appointment and Authorization . Each Lender hereby irrevocably appoints, designates and authorizes the Administrative Agent to take such action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto, including, without limitation, acting as the representative of each Secured Party for the perfection of the Liens granted pursuant to the Collateral Documents. Notwithstanding any provision to the contrary contained elsewhere in this Agreement or in any other Loan Document, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent. Notwithstanding the use of the term Administrative Agent, the Administrative Agents legal relationship with the Lenders shall not be one of agency, it being understood and agreed to by the Lenders that the Administrative Agent is an independent contractor for the Lenders.
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SECTION 8.2. Delegation of Duties . The Administrative Agent may execute any of its duties under this Agreement or any other Loan Document by or through its agents, employees or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects with reasonable care.
SECTION 8.3 . Liability of Administrative Agent . None of the Administrative Agent-Related Persons shall (i) be liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document (except for its own gross negligence, bad faith or willful misconduct), or (ii) be responsible in any manner to any of the Lenders for any recital, statement, representation or warranty made by the Borrower or any Subsidiary or Affiliate of the Borrower, or any officer thereof, contained in this Agreement or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document, or for the value of any Collateral or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of the Borrower or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Administrative Agent-Related Person shall be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions, of this Agreement or any other Loan Document, or to inspect the properties, books or records of the Borrower or any of its Subsidiaries or Affiliates.
SECTION 8.4 . Reliance by Administrative Agent .
(a) The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to the Loan Parties), independent accountants and other experts selected by the Administrative Agent. Except for its express obligations set forth in Article II hereof, the Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Majority Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Majority Lenders and such request and any action taken or failure to act pursuant thereto shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions specified in Sections 4.1 and 4.2 , each Lender that has executed this Agreement, or an
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Assignment and Acceptance, shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter either sent by the Administrative Agent to such Lender for consent, approval, acceptance or satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to such Lender, unless an officer of the Administrative Agent responsible for the transactions contemplated by the Loan Documents shall have received notice from such Lender prior to the initial Borrowing specifying its objection thereto and either such objection shall not have been withdrawn by notice to the Administrative Agent to that effect or such Lender shall not have made available to the Administrative Agent such Lenders ratable portion of such Borrowing.
SECTION 8.5 . Notice of Default . The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders, unless the Administrative Agent shall have received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a notice of default. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give prompt notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be requested by the Majority Lenders in accordance with Article VII ; provided that unless and until the Administrative Agent shall have received any such request, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable or in the best interest of the Lenders.
SECTION 8.6 . Credit Decision . Each Lender expressly acknowledges that none of the Administrative Agent-Related Persons has made any representation or warranty to it and that no act by the Administrative Agent hereinafter taken, including any review of the affairs of the Loan Parties shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of the Loan Parties, and all applicable bank regulatory laws relating to the transactions contemplated thereby, and made its own decision to enter into this Agreement and extend credit to the Borrower hereunder. Each Lender also represents that it will, independently and without reliance upon the Administrative Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrower. Except for notices, reports and other documents expressly herein required to be furnished to the Lenders by the Administrative Agent, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects,
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operations, property, financial and other condition or creditworthiness of the Borrower which may come into the possession of any of the Administrative Agent-Related Persons.
SECTION 8.7 . Indemnification . Whether or not the transactions contemplated hereby shall be consummated, the Lenders shall indemnify upon demand the Administrative Agent-Related Persons (to the extent not reimbursed by or on behalf of the Borrower and without limiting the obligation of the Borrower to do so), ratably according to such Lenders Percentage from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses and disbursements of any kind whatsoever which may at any time (including at any time following the repayment of the Loans and the termination or resignation of the related Administrative Agent) be imposed on, incurred by or asserted against any such Person and which are in any way relating to or arising out of this Agreement or any document contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by any such Person under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment to the Administrative Agent-Related Persons of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from such Persons gross negligence, bad faith or willful misconduct. Without limitation of the foregoing, each Lender shall reimburse the Administrative Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the Borrower. Without limiting the generality of the foregoing, if the IRS or any other Governmental Authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered, was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent under this Section, together with all costs and expenses (including Attorney Costs). The obligation of the Lenders in this Section shall survive the payment of all Obligations hereunder.
SECTION 8.8 . Administrative Agent in Individual Capacity . Bank of America and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory or other business with the Loan Parties and their Affiliates as though Bank of America were not the Administrative Agent hereunder and without notice to or consent of the Lenders. With respect to its Loans and interests in Letters of Credit issued hereunder, Bank of America shall have the same rights and
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powers under this Agreement as any other Lender and may exercise the same as though it were not the Administrative Agent, and the terms Lender and the Lenders shall include Bank of America in its individual capacity.
SECTION 8.9 . Successor Administrative Agent . The Administrative Agent may, and at the request of the Majority Lenders shall, resign as Administrative Agent upon thirty (30) days notice to the Lenders and the Borrower. If the Administrative Agent shall resign as Administrative Agent under this Agreement, the Majority Lenders shall appoint from among the Lenders a successor representative for the Lenders. If no successor representative is appointed prior to the effective date of the resignation of the Administrative Agent, the Administrative Agent may appoint, after consulting with the Lenders and the Borrower, a successor representative from among the Lenders. Upon the acceptance of its appointment as successor representative hereunder, such successor representative shall succeed to all the rights, powers and duties of the retiring Administrative Agent and the term Administrative Agent shall mean such successor representative and the retiring Administrative Agents appointment, powers and duties as Administrative Agent shall be terminated. After any retiring Administrative Agents resignation hereunder as Administrative Agent, the provisions of this Article VIII and Sections 9.4 and 9.10 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement. If no successor representative has accepted appointment as Administrative Agent by the date which is thirty (30) days following a retiring Administrative Agents notice of resignation, the retiring Administrative Agents resignation shall nevertheless thereupon become effective and the Lenders shall perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Majority Lenders appoint a successor representative as provided for above. Upon resignation, the Administrative Agent shall execute and deliver such assignments and take such other actions as the Lenders shall reasonably request in order to transfer and assign its rights and interests under the Collateral Documents to the Lenders or any successor representative appointed by the Lenders; provided that any costs and expenses incurred by the Administrative Agent in taking such actions shall be reimbursed in accordance with Section 9.4(a) .
SECTION 8.10 . Collateral Matters; Release of Collateral .
(a) The Administrative Agent is authorized on behalf of all the Lenders, without the necessity of any notice to or further consent from the Lenders, from time to time to take any action with respect to any Collateral or the Collateral Documents which may be necessary to perfect and maintain perfected the security interest in and Liens upon the Collateral granted pursuant to the Collateral Documents.
(b) The Lenders irrevocably authorize the Administrative Agent, and the Administrative Agent hereby agrees upon the request of the Borrower, to release any Lien granted to or held by the Administrative Agent upon any Collateral (i) upon termination of the Commitments and payment in full of all Loans and all other Obligations (or cash collateralization of any outstanding Letters of Credit in a manner acceptable to the applicable Issuing Lender) payable under this Agreement and under any other Loan Document (other than contingent obligations for which no claim has been, or
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is reasonably expected to be, made); (ii) constituting property sold or to be sold or disposed of as part of or in connection with any disposition permitted hereunder; (iii) constituting property in which none of the Loan Parties owned any interest at the time the Lien was granted or at any time thereafter; (iv) constituting property leased to any Loan Party under a lease which has expired or been terminated in a transaction permitted under this Agreement or is about to expire and which has not been, and is not intended by such Loan Party to be, renewed or extended; (v) consisting of an instrument evidencing Debt or other debt instrument, if the Debt evidenced thereby has been paid in full; (vi) if required by the Intercreditor Agreement; (vii) with respect to which (A) the Borrower shall have requested in writing that the Administrative Agent release its Lien thereon, (B) the Borrower shall have provided, or caused one or more of its Subsidiaries to provide, substitute Collateral of reasonably equivalent or greater value to that of such Collateral subject to such requested Lien release, (C) the Administrative Agent shall have reasonably determined that such substitute Collateral is otherwise acceptable, (D) such substitute Collateral (and the Administrative Agents substitute Lien thereon) shall be subject to documentation reasonably satisfactory to the Administrative Agent and (E) such release and substitution is otherwise made in compliance with Section 3.1 of the Intercreditor Agreement; or (viii) if approved, authorized or ratified in writing by the Majority Lenders. Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the Administrative Agents authority to release particular types or items of Collateral pursuant to this Section 8.10(b) . The Administrative Agent hereby agrees to execute and deliver to the Borrower such instruments and documents as are requested by the Borrower (and prepared and filed at Borrowers sole cost and expense) to effect each release permitted hereunder.
SECTION 8.11 . Intercreditor Agreement and other Loan Documents . Except to the extent provided in Section 9.1 , each Lender from time to time party hereto authorizes and consents, by its execution hereof or by the Assignment and Acceptance by which it became a Lender, to the Administrative Agents entering into the Intercreditor Agreement and each of the other Loan Documents on such Lenders behalf and taking all actions taken, required or permitted to be taken by the Administrative Agent thereunder.
ARTICLE IX
.
MISCELLANEOUS
SECTION 9.1 . Amendments, Etc . No amendment or waiver of any provision of this Agreement or any other Loan Document, nor consent to any departure by Holdings or the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Majority Lenders and the Borrower and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that no amendment, waiver or consent shall, unless in writing and signed by all of the affected Lenders and the Borrower do any of the following: (a) reduce the rate of interest on any Loan or obligation or reduce any fee payable to the Lenders, (b) reduce or forgive the principal of, or interest on, the Loans or any fees or other amounts payable hereunder, (c) postpone any date fixed for any payment of principal of, or interest on, the Loans or any fees or other amounts payable hereunder (it being understood that, with the consent of the Required Prepayment
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Lenders, changes to any mandatory prepayments set forth in clauses (b) through (f) of Section 2.8.1 , including the application thereof, may be made), (d) reduce the percentage specified in the definition of Majority Facility Lenders (with respect to any Facility all Lenders under such Facility shall be deemed to be directly affected by such a reduction), (e) extend the expiration of or change the percentage of any of the Commitments or increase the number of the Lenders which shall be required for the Lenders or any of them to take any action hereunder, (f) require additional consents, to be obtained with respect to the sale or any assignment or participation of any Lenders hereunder, (g) release all or substantially all of the Guarantees or the Liens of the Administrative Agent and the Lenders on all or substantially all of the Collateral (other than to the extent permitted by Section 8.10) , or (h) amend this Section 9.1 or otherwise modify the voting provisions of this Agreement or amend the definition of Majority Lenders or Required Prepayment Lenders; provided , further , that no amendment, waiver or consent shall (i) be effective without the consent of the Majority Revolving Credit Facility Lenders, if the same shall amend, modify or waive any condition precedent to any extension of credit under the Revolving Credit Facility set forth in Section 4.2 (including, without limitation, the waiver of an existing Default or Event of Default required to be waived in order for such extension of credit to be made), (ii) unless in writing and signed by the Administrative Agent in addition to the Lenders required above to take such action, affect the rights or duties of the Administrative Agent under this Agreement, or (iii) effect an increase in any of the Commitments of any Lender without such Lenders express written approval.
If, in connection with any proposed amendment, modification, waiver or termination (a Proposed Change ) requiring the consent of all affected Lenders, the consent of Majority Lenders is obtained but the consent of other Lenders whose consent is required is not obtained (any such Lender whose consent is not obtained as described in this Section 9.1 being referred to as a Non-Consenting Lender ), then, so long as the Lender acting as the Administrative Agent is not a Non-Consenting Lender, at the Borrowers request, an assignee acceptable to the Administrative Agent shall have the right with the Administrative Agents consent and in the Administrative Agents sole discretion (but shall have no obligation) to purchase from such Non-Consenting Lender, and such Non-Consenting Lender agrees that it shall, upon the Administrative Agents request, sell and assign to the Lender acting as the Administrative Agent or such Assignee, all of the interests, rights and obligations under this Agreement (including, without limitation, the Commitments and the Percentage of the Obligations) of such Non-Consenting Lender for an amount equal to the principal balance of all Loans held by the Non-Consenting Lender and all accrued interest and fees with respect thereto through the date of sale; provided , however , that such purchase and sale shall not be effective until the Administrative Agent shall have received from such assignee an agreement in form and substance satisfactory to the Administrative Agent and the Borrower whereby such assignee shall agree to be bound by the terms hereof. Each Lender agrees that, if it becomes a Non-Consenting Lender, it shall execute and deliver to the Administrative Agent an Assignment and Acceptance to evidence such sale and purchase and shall deliver to the Administrative Agent any Note (if the assigning Lenders Loans are evidenced by Notes) subject to such Assignment and Acceptance; provided , however ,
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that the failure of any Non-Consenting Lender to execute an Assignment and Acceptance shall not render such sale and purchase (and the corresponding assignment) invalid.
SECTION 9.2 . Notices, Etc. Unless otherwise specifically permitted herein, all notices and other communications provided for hereunder shall be in writing (including telecopier, telegraphic, telex or cable communication) and mailed, telecopied, telegraphed, telexed, cabled or delivered, and addressed as follows:
(a) if to the Borrower or any other Loan Party:
Great Lakes Dredge & Dock Corporation
c/o Madison Dearborn Partners IV, L.P.
Three First National Plaza
Suite 3800
Chicago, Illinois 60602
Attention: Sam M. Mencoff and Thomas S.
Souleles
Telecopier: (312) 895-1056
and
Great Lakes Dredge & Dock Corporation
2212 York Road
Oak Brook, IL 60523
Attention: Chief Financial Officer
Telecopier: (630) 574-3007
with a copy to:
Kirkland & Ellis LLP
Aon Center
200 East Randolph Drive
Chicago, Illinois 60601-6636
Attention: Francesco Penati; Richard
Campbell
Telecopier: (312) 861-2200
(b) if to any Lender, an original party hereto, at its Domestic Lending Office specified on Schedule 1 to the Lender Addendum of such Lender; if to any other Lender, at its Domestic Lending Office specified in the Assignment and Acceptance pursuant to which it became a Lender; and
(c) if to Bank of America as an Issuing Lender or the Administrative Agent:
Bank of America, N.A.
231 South LaSalle Street
Chicago, Illinois 60697
Attention: David Johanson and Jeffery
T. White
Telecopier: (877) 206-8410 and (877)
207-0485
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with a copy to:
Bank of America, N.A.
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Jennifer Gerdes
Telecopier: (312) 974-0791
with a copy to:
Sidley Austin Brown & Wood LLP
Bank One Plaza
10 South Dearborn Street
Chicago, Illinois 60603
Attention: Michael Gold, Esq.
Telecopier: (312) 853-7036
or, as to Holdings, the Borrower or the Administrative Agent, at such other address as shall be designated by such party in a written notice to the other parties and, as to each other party, at such other address as shall be designated by such party in a written notice to Holdings, the Borrower and the Administrative Agent. All such telecopier, telegraphic, telex or cable notices and communications shall, when telecopied, telegraphed, telexed or cabled, be effective when telecopied delivered to the telegraph company, confirmed by telex answerback or delivered to the cable company, respectively, and all such mail notices and communications shall be effective five (5) days after deposit in the mails; except that notices and communications by any of the above means to the Administrative Agent pursuant to Articles II , III or VIII shall not be effective until received by the Administrative Agent.
SECTION 9.3 . No Waiver; Remedies . No failure on the part of any Lender or the Administrative Agent to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
SECTION 9.4 . Costs and Expenses; Indemnification . The Borrower agrees (a) to pay or reimburse the Administrative Agent and the Arrangers for all their reasonable out-of-pocket costs and expenses incurred in connection with the syndication of the Facilities (other than fees payable to syndicate members) and the development, preparation and execution of, and any amendment, supplement or modification to, this Agreement and the other Loan Documents and any other documents prepared in connection herewith or therewith, and the consummation and administration of the transactions contemplated hereby and thereby, including, without limitation, the reasonable fees and disbursements and other charges of counsel to the Administrative Agent and the Arrangers and the charges of Intralinks, (b) to pay or reimburse each Lender and the Administrative Agent for all their costs and expenses incurred in
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connection with the enforcement or preservation of any rights under this Agreement, the other Loan Documents and any other documents prepared in connection herewith or therewith, including, without limitation, the fees and disbursements of counsel and charges of Intralinks to each Lender and of counsel to the Administrative Agent, (c) to pay, indemnify, or reimburse each Lender and the Administrative Agent for, and hold each Lender and the Administrative Agent harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay, in paying, stamp, excise and other taxes, if any, which may be payable in connection with the execution and delivery of, or consummation or administration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan Documents and any such other documents, and (d) to pay, indemnify or reimburse each Lender, the Administrative Agent, the Arrangers, their respective affiliates, and their respective officers, directors, trustees, employees, advisors, agents and controlling persons (each, an Indemnitee ) for, and hold each Indemnitee harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of this Agreement, the other Loan Documents and any such other documents, including, without limitation, any of the foregoing relating to the use of proceeds of the Loans or the violation of, noncompliance with or liability under, any Environmental Law applicable to the operations of Holdings, the Borrower any of its Subsidiaries or any of the Properties and the fees and disbursements and other charges of legal counsel in connection with claims, actions or proceedings by any Indemnitee against the Borrower hereunder (all the foregoing in this clause (d) , collectively, the Indemnified Liabilities ), provided, that the Borrower shall have no obligation hereunder to any Indemnitee with respect to Indemnified Liabilities to the extent such Indemnified Liabilities are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee. No Indemnitee shall be liable for (i) consequential damages as a result of any failure to fund any of the Facilities or (ii) any damages arising from the use by unauthorized persons of Information or other materials sent through electronic, telecommunications or other information transmission systems that are intercepted by such persons or for any special, indirect, consequential or punitive damages in connection with the Facilities (unless such damages resulted directly from the gross negligence, bad faith or willful misconduct of the Person claiming the protections of clause (ii)). Without limiting the foregoing, and to the extent permitted by applicable law, the Borrower agrees not to assert and to cause its Subsidiaries not to assert, and hereby waives and agrees to cause its Subsidiaries so to waive, all rights for contribution or any other rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature, under or related to Environmental Laws, that any of them might have by statute or otherwise against any Indemnitee; provided , however , that the Borrower shall retain all such rights of recovery with respect to any liabilities arising under Environmental Laws resulting from the gross negligence, bad faith or willful misconduct of such Indemnitee. All amounts due under this Section shall be payable not later than 30 days after written demand therefor. Statements payable by the Borrower
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pursuant to this Section shall be submitted to Deborah A. Wensel (Telephone No. (630) 574-3007) (Fax No. (630) 574-2981), at the address of the Borrower set forth in Section 9.2, or to such other Person or address as may be hereafter designated by the Borrower in a notice to the Administrative Agent. The agreements in this Section shall survive repayment of the Loans and all other amounts payable hereunder.
SECTION 9.5 . Setoff . In addition to and not in limitation of any rights of any Lender under Applicable Law, each Lender shall, upon the occurrence and during the continuance of any Event of Default described in Section 7.1(a) or Section 7.1(e) , have the right to appropriate and apply to the payment of the Obligations then due and unpaid, and, as security for such Obligations, each of the Loan Parties hereby grants to each Lender a continuing security interest in, any and all deposits or accounts of the Borrower then or thereafter maintained with such Lender or participant; provided that any such appropriation and application shall be subject to the provisions of Section 2.17 . Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such setoff and application made by such Lender; provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of each Lender under this Section 9.5 are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
SECTION 9.6 . Effectiveness . This Agreement shall become effective when it shall have been executed by the Borrower and the Administrative Agent and when the Administrative Agent shall have been notified by each Lender that such Lender has executed it.
SECTION 9.7 . Successors and Assigns; Participations and Assignments . (a) This Agreement shall be binding upon and inure to the benefit of Holdings, the Borrower, the Lenders, the Administrative Agent, all future holders of the Loans and their respective successors and assigns, except that neither Holdings nor the Borrower may assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Administrative Agent and each Lender.
(b) Any Lender may, without the consent of the Borrower, in accordance with applicable law, at any time sell to one or more banks, financial institutions or other entities (each, a Participant ) participating interests in any Loan owing to such Lender, any Commitment of such Lender or any other interest of such Lender hereunder and under the other Loan Documents. In the event of any such sale by a Lender of a participating interest to a Participant, such Lenders obligations under this Agreement to the other parties to this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of any such Loan for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lenders rights and obligations under this Agreement and the other Loan Documents. In no event shall any Participant under any such participation have any right to approve any amendment or waiver of any provision of any Loan Document, or any consent to any departure by any Loan Party therefrom, except to the extent that such amendment, waiver or consent would require the
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consent of the Lender from which such participation was purchased pursuant to Section 9.1 . The Borrower agrees that if amounts outstanding under this Agreement and the Loans are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall, to the maximum extent permitted by applicable law, be deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement, provided that, in purchasing such participating interest, such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 9.7(a) as fully as if such Participant were a Lender hereunder. The Borrower also agrees that each Participant shall be entitled to the benefits of Sections 2.10, 2.11, 2.12 and 2.16 with respect to its participation in the Commitments and the Loans outstanding from time to time as if such Participant were a Lender; provided that, in the case of Sections 2.12 and 2.16 , such Participant shall have complied with the requirements of said Section, and provided , further , that no Participant shall be entitled to receive any greater amount pursuant to any such Section than the transferor Lender would have been entitled to receive in respect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred.
(c) Any Lender (an Assignor ) may, in accordance with applicable law and upon written notice to the Administrative Agent, at any time and from time to time assign to any Lender or any Affiliate, Related Fund or Control Investment Affiliate thereof or, with the written consent of the Borrower and the Administrative Agent and, in the case of any assignment of Revolving Commitments, the written consent of the Issuing Lenders (which, in each case, shall not be unreasonably withheld or delayed) ( provided (y) that no such consent need be obtained by either of the Arrangers or any of their respective Affiliates with respect to any assignment by either of them and (z) that the consent of the Borrower need not be obtained with respect to any assignment of Tranche B Term Loans), to an additional bank, financial institution or other entity (an Assignee ) all or any part of its rights and obligations under this Agreement pursuant to an Assignment and Acceptance, substantially in the form of Exhibit A , executed by such Assignee and such Assignor (and, where the consent of the Borrower, the Administrative Agent or the Issuing Lenders is required pursuant to the foregoing provisions, by the Borrower and such other Persons) and delivered to the Administrative Agent for its acceptance and recording in the Register; provided that no such assignment to an Assignee (other than any Lender or any Affiliate or Related Fund), in the case of an assignment of Revolving Commitments and/or Revolving Loans, shall be in an aggregate principal amount of less than $5,000,000 or, in the case of Tranche B Term Loan, shall be in an aggregate principal amount of less than $1,000,000 (in each case, other than in the case of an assignment of all of a Lenders interests under this Agreement), and after giving effect thereto, the Assignor, in the case of an assignment of Revolving Commitments and/or Revolving Loans, shall have Revolving Commitments and/or Revolving Loans aggregating at least $5,000,000 and, in the case of an assignment of Tranche B Term Loans, shall have Tranche B Term Loans aggregating at least $1,000,000, in each case unless otherwise agreed by the Borrower and the Administrative Agent. Any such assignment need not be ratable as among the Facilities. Upon such execution, delivery, acceptance and recording, from and after the effective date
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determined pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereunder with Commitments and/or Loans as set forth therein, (y) the Assignor thereunder shall, to the extent provided in such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of an Assignors rights and obligations under this Agreement, such Assignor shall cease to be a party hereto, except as to Section 2.10 , 2.11 , 2.12 and 9.4 in respect of the period prior to such effective date), and (z) the assignee shall comply with Section 2.16 (f) . Notwithstanding any provision of this Section, the consent of the Borrower shall not be required for any assignment that occurs at any time when any Event of Default shall have occurred and be continuing. For purposes of the minimum assignment amounts set forth in this paragraph, multiple assignments by two or more Related Funds shall be aggregated.
(d) The Administrative Agent shall, on behalf of the Borrower, maintain at its address referred to in Section 9.2 a copy of each Assignment and Acceptance delivered to it and a register (the Register ) for the recordation of the names and addresses of the Lenders and the Commitment of, and principal amount of the Loans owing to, each Lender from time to time. The entries in the Register shall be presumptive evidence of the amounts so entered, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register as the owner of the Loans and any Notes evidencing such Loans recorded therein for all purposes of this Agreement. Any assignment of any Loan, whether or not evidenced by a Note, shall be effective only upon appropriate entries with respect thereto being made in the Register (and each Note shall expressly so provide). Any assignment or transfer of all or part of a Loan evidenced by a Note shall be registered on the Register only upon surrender for registration of assignment or transfer of the Note evidencing such Loan, accompanied by a duly executed Assignment and Acceptance; thereupon one or more new Notes in the same aggregate principal amount shall be issued to the designated Assignee, and the old Notes shall be returned by the Administrative Agent to the Borrower marked canceled. The Register shall be available for inspection by the Borrower or any Lender (with respect to any entry relating to such Lenders Loans) at any reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an Assignor and an Assignee (and, in any case where the consent of any other Person is required by Section 9.7(c) , by each such other Person) together with payment to the Administrative Agent of a registration and processing fee of $3,500 (except that no such registration and processing fee shall be payable in the case of an Assignee which is already a Lender or is an Affiliate or Related Fund of a Lender or a Person under common management with a Lender), the Administrative Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the effective date determined pursuant thereto record the information contained therein in the Register and give notice of such acceptance and recordation to the Borrower. On or prior to such effective date, the Borrower, at its own expense, upon request, shall execute and deliver to the Administrative Agent (in exchange for the applicable Notes of the assigning Lender) a new Notes to the order of such Assignee in an amount equal to the Revolving
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Commitment and/or applicable Tranche B Term Loans, as the case may be, assumed or acquired by it pursuant to such Assignment and Acceptance and, if the Assignor has retained a Revolving Commitment and/or Tranche B Term Loans, as the case may be, upon request, a new Note and/or Notes, as the case may be, to the order of the Assignor in an amount equal to the Revolving Commitment and/or applicable Tranche B Term Loans, as the case may be, retained by it hereunder. Such new Note or Notes shall be dated the Closing Date and shall otherwise be in the form of the Note or Notes replaced thereby.
(f) For avoidance of doubt, the parties to this Agreement acknowledge that the provisions of this Section 9.7 concerning assignments of Loans and Notes relate only to absolute assignments and that such provisions do not prohibit assignments creating security interests in Loans and Notes, including, without limitation, any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank in accordance with applicable law.
(g) Notwithstanding anything to the contrary contained herein, any Lender (a Granting Lender ) may grant to a special purpose funding vehicle (an SPC ), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, the option to provide to the Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to the Borrower pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender. Each party hereto hereby agrees that no SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender). In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other Debt of any SPC, it will not institute against, or join any other person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of the United States or any state thereof. In addition, notwithstanding anything to the contrary in this Section 9.7(g) , any SPC may (A) with notice to, but without the prior written consent of, the Borrower and the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Lender, or with the prior written consent of the Borrower and the Administrative Agent (which consent shall not be unreasonably withheld) to any financial institutions providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans, and (B) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC; provided that non-public information with respect to the Borrower may be disclosed only with the Borrowers consent which will not be
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unreasonably withheld. This Section 9.7(g) may not be amended without the written consent of any SPC with Loans outstanding at the time of such proposed amendment.
SECTION 9.8 . Survival of Warranties and Agreements . All agreements, representations and warranties made herein shall survive the execution and delivery of this Agreement and the other Loan Documents and the making and repayment of the Obligations hereunder.
SECTION 9.9 . Marshalling; Recourse to Security; Payments Set Aside . Neither any Lender nor the Administrative Agent shall be under any obligation to marshall any assets in favor of the Borrower or any other Loan Party or against or in payment of any or all of the Obligations. Recourse to security shall not be required at anytime. To the extent that any Loan Party makes a payment or payments to the Administrative Agent or the Lenders, or the Administrative Agent or the Lenders enforce their security interests or exercise their rights of set-off, and such payment or payments or the proceeds of such enforcement or set-off or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or set-off had not occurred.
SECTION 9.10 . Submission To Jurisdiction; Waivers .
(a) All judicial proceedings brought against any party to this Agreement with respect to this Agreement or any other Loan Document may be brought in any state or federal court of competent jurisdiction in the State of New York, and by execution and delivery of this Agreement, each party accepts, for itself and in connection with its properties, generally and unconditionally, the nonexclusive jurisdiction of the aforesaid courts, and irrevocably agrees to be bound by any final judgment rendered thereby in connection with this Agreement or any of the other Loan Documents from which no appeal has been taken or is available. Each party irrevocably consents to the service of process of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to its notice address specified on the signature pages hereof, such service to become effective ten (10) days after such mailing. EACH LOAN PARTY, EACH ISSUING LENDER, THE ADMINISTRATIVE AGENT, AND EACH LENDER IRREVOCABLY WAIVES (A) TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, AND (B) ANY OBJECTION (INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. Nothing herein shall affect the right to serve process in any other manner permitted by law or shall limit the
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right of the Administrative Agent or any Lender or any Loan Party to bring proceedings against any Loan Party in the courts of any other jurisdiction.
SECTION 9.11 . Performance of Obligations . Each Loan Party agrees that the Administrative Agent, the Issuing Lenders and the Lenders, or any one or more of them, may, but shall have no obligation to, make any payment or perform any act required of such Loan Party under any Loan Document or take any other action which such party in its discretion deems necessary or desirable to protect or preserve the Collateral, including any action to pay or discharge taxes, liens, security interests or other encumbrances levied or placed on or threatened against any Collateral.
SECTION 9.12 . Construction . The parties acknowledge that each party and its counsel have reviewed and revised this Agreement and the other Loan Documents and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Loan Documents or any amendments or exhibits thereto.
SECTION 9.13 . GOVERNING LAW . THIS AGREEMENT, THE OTHER LOAN DOCUMENTS (UNLESS ANY SUCH LOAN DOCUMENT EXPRESSLY PROVIDES OTHERWISE), AND THE LETTERS OF CREDIT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICTS OF LAW PRINCIPLES (OTHER THAN THE PROVISIONS OF 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
SECTION 9.14 . Execution in Counterparts . This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.
SECTION 9.15 . Entire Agreement . This Agreement, together with the other Loan Documents, embodies the entire agreement and understanding among the Loan Parties, the Lenders, the Issuing Lenders and the Administrative Agent, and supersedes all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating to the subject matter hereof and thereof, except for the fee letter dated as of December 3, 2003 among MDP, LCPI, Lehman Brothers, CSFB and the Administrative Agent, and any prior arrangements made with respect to the payment by the Borrower of (or any indemnification for) any fees, costs or expenses payable to or incurred (or to be incurred) by or on behalf of the Administrative Agent or the Lenders
SECTION 9.16 . Delivery of Lender Addenda . Each initial Lender shall become a party to this Agreement by delivering to the Administrative Agent a Lender Addendum duly executed by such Lender, the Borrower and the Administrative Agent.
SECTION 9.17 . Non-Confidentiality of Tax Structure . Notwithstanding anything herein to the contrary, each party hereto (and each affiliate and person acting on behalf of any such party) agrees that each party (and each employee, representative, and
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other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transaction contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to such party or such person relating to such tax treatment and tax structure, except to the extent necessary to comply with any applicable federal or state securities laws. This authorization is not intended to permit disclosure of any other information including (without limitation) (i) any portion of any materials to the extent not related to the tax treatment or tax structure of the transaction, (ii) the identities of participants or potential participants in the transaction, (iii) the existence or status of any negotiations, (iv) any pricing or financial information (except to the extent such pricing or financial information is related to the tax treatment or tax structure of the transaction), or (v) any other term or detail not relevant to the tax treatment or the tax structure of the transaction.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the Closing Date.
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/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Senior Vice President, Chief |
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Financial Officer and Treasurer |
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GREAT LAKES CARIBBEAN DREDGING,
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By: |
/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Senior Vice President, Chief |
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Financial Officer and Treasurer |
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[SIGNATURE PAGE TO CREDIT AGREEMENT]
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FIFTY-THREE DREDGING CORPORATION |
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By: |
/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Vice President |
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NORTH AMERICAN SITE DEVELOPERS,
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By: |
/s/ Deborah A. Wensel |
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Name: Deborah A. Wensel |
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Title: Vice President and Treasurer |
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[SIGNATURE PAGE TO CREDIT AGREEMENT]
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BANK OF AMERICA, N.A.,
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By: |
/s/ Helen Zitzman |
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Name: Helen Zitzman |
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Title: Senior Vice President |
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[SIGNATURE PAGE TO CREDIT AGREEMENT]
DEFINITIONS
1933 Act means the Securities Act of 1933, as amended from time to time.
1934 Act means the Securities Exchange Act of 1934, as amended from time to time.
Acquisition has the meaning specified in the recitals .
Acquisition Agreement means the Merger Agreement dated November 12, 2003 between GLDD Acquisitions Corp., Merger Sub and Great Lakes Dredge & Dock Corporation.
Adjusted Consolidated EBITDA means EBITDA plus adjustments, without duplication (i) required or permitted by Regulation S-X of the 1933 Act, and (ii) for the four Fiscal Quarters ending September 30, 2003, December 31, 2003, March 31, 2004, June 30, 2004, and September 30, 2004 consisting of up to $3,200,000 of adjustments with respect to the pro forma savings resulting from the equipment financing transactions, subject to confirmation by the Arrangers that the Borrowers calculation of such savings is reasonable.
Administrative Agent has the meaning specified in the preamble .
Administrative Agent-Related Persons means Bank of America and any successor Administrative Agent arising under Section 8.9 , together with their respective Affiliates, and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.
Affiliate means, with respect to any Person, any other Person:
(i) which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such Person (excluding any trustee under, or any committee with responsibility for administering any Plan);
(ii) which beneficially owns or holds ten percent (10%) or more of any class of the Voting Stock of such Person (or, in the case of a Person which is not a corporation, ten percent (10%) or more of the equity interests); or
(iii) ten percent (10%) or more of the Voting Stock (or, in the case of a Person which is not a corporation, ten percent (10%) or more of the equity interests) of which, is beneficially owned or held, directly or indirectly, by such Person.
The term control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of Voting Stock, by contract or otherwise.
Agreement has the meaning specified in the preamble .
Alternative Currency means Euros, British Pound Sterling, Canadian Dollars, German Deutschmarks, and any other lawful currency other than Dollars which is freely transferable and convertible into Dollars as agreed to from time to time by an Issuing Lender and the Administrative Agent (in their respective sole and absolute discretion).
Applicable Base Rate Margin , Applicable Commitment Fee Percentage , Applicable Eurodollar Rate Margin , Applicable Financial Letter of Credit Fee Percentage , and Applicable Performance Letter of Credit Fee Percentage respectively mean, during any Pricing Period, the amount set forth below for such Applicable Base Rate Margin, Applicable Commitment Fee Percentage, Applicable Eurodollar Rate Margin, Applicable Financial Letter of Credit Fee Percentage or Applicable Performance Letter of Credit Fee Percentage, as the case may be, depending upon the Total Leverage Ratio as of the last day of the Fiscal Quarter most recently ended prior to the first day of such Pricing Period:
Total
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Applicable
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Applicable
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Applicable
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Applicable
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Applicable
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Less than 3.00x |
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1.25 |
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.50 |
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2.25 |
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2.25 |
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1.18 |
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Greater than or equal to 3.00x but less 3.75x |
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1.50 |
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.50 |
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2.50 |
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2.50 |
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1.25 |
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Greater than or equal to 3.75x but less 4.75x |
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1.75 |
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.50 |
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2.75 |
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2.75 |
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1.38 |
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Greater than or equal to 4.75x |
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2.00 |
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.50 |
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3.00 |
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3.00 |
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1.50 |
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provided , however , that (i) if and for so long as the Borrower shall have failed to timely deliver a Compliance Certificate under Section 6.4(b) or Section 6.4(c) with respect to such Fiscal Quarter most recently ended, the Applicable Base Rate Margin, Applicable Commitment Fee Percentage, Applicable Eurodollar Rate Margin, Applicable Financial Letter of Credit Fee Percentage, and Applicable Performance Letter of Credit Fee Percentage for such Pricing Period shall be determined as if the Total Leverage Ratio is greater than or equal to 4.75 to 1.00, (ii) notwithstanding the foregoing, (a) for the period beginning on the Closing Date and ending on December 31, 2003, the Applicable Base Rate Margin, Applicable Commitment Fee Percentage, Applicable Eurodollar Rate Margin, Applicable Financial Letter of Credit Fee Percentage, and Applicable Performance Letter of Credit Fee Percentage for such Pricing Periods shall be determined
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as if the Total Leverage Ratio is greater than or equal to 3.75 to 1.00 but less than 4.75 to 1.00, and (iii) notwithstanding the foregoing, the Applicable Performance Letter of Credit Fee Percentage shall be subject to change in accordance with Section 2.10(c) .
Applicable Law means, with respect to any Person or matter, any law, rule, regulation, order, decree or other requirement having the force of law relating to such Person or matter and, where applicable, any interpretation thereof by any Person having jurisdiction with respect thereto or charged with the administration or interpretation thereof.
Applicable Lending Office means, with respect to each Lender, such Lenders Domestic Lending Office in the case of a Base Rate Loan and such Lenders Eurodollar Office in the case of a Eurodollar Rate Loan.
Arrangers has the meaning specified in the preamble .
Assignee has the meaning specified in Section 9.7 .
Assignment and Acceptance means an assignment and acceptance entered into by a Lender and an Assignee, and accepted by the Administrative Agent, in substantially the form of Exhibit A .
Assignor has the meaning specified in Section 9.7 .
Attorney Costs means and includes all reasonable out-of-pocket fees and disbursements of any law firm or other external counsel.
Authorized Officer means, relative to any Loan Party, the officers of such Loan Party whose signatures and incumbency shall have been certified to the Administrative Agent pursuant to Section 4.1.
Availability means, at any time, an amount (determined on a Dollar equivalent basis) equal to the Revolving Commitment Amount then in effect minus the then outstanding Letter of Credit Obligations.
Available Revolving Commitments means with respect to any Revolving Lender at any time, an amount equal to the excess, if any, of (a) such Lenders Revolving Commitment then in effect over (b) such Lenders Revolving Extensions of Credit then outstanding.
Bank of America has the meaning specified in the preamble .
Bankruptcy Code means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq. ).
Base Capital Expenditure Amount has the meaning specified in Section 6.3(a).
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Base Rate means the higher of:
(i) the rate of interest publicly announced from time to time by Bank of America (or its successor) in Charlotte, North Carolina as its reference rate. It is a rate that is set by Bank of Americas costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in the reference rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change; and
(ii) 0.50% per annum above the latest Federal Funds Rate.
Base Rate Loan means a Loan which bears interest at or determined by reference to the Base Rate.
Bonding Agreement means, collectively, the Travelers Agreement and any supplement thereto or replacement thereof, and any similar contractual arrangement with providers of bid, performance or payment bonds, each of which supplement, replacement or similar arrangement being subject to the Intercreditor Agreement.
Borrower has the meaning specified in the preamble .
Borrowing means a borrowing of Loans made by all of the Lenders in accordance with their respective applicable Percentages, on the same Business Day, in accordance with Section 2.4 .
Business Day means a day of the year on which banks are not required or authorized to close in any of New York City or Chicago and, if the applicable Business Day relates to any Eurodollar Rate Loan, a day of the year on which dealings are carried on in the interbank Eurodollar market.
Capital Adequacy Regulation means any guideline, request or directive of any central bank or other Governmental Authority, or any other law, rule or regulation, whether or not having the force of law, in each case, regarding capital adequacy of any bank or of any corporation controlling a bank.
Capital Expenditures means, for any period, the aggregate amount of all expenditures of the Borrower and its Subsidiaries for fixed or capital assets made or incurred during such period (whether or not paid in cash and including that portion of Capitalized Leases which is capitalized on the consolidated balance sheet of the Borrower and its Subsidiaries) which, in accordance with GAAP, would be classified as capital expenditures; provided , however , that, for any such period, such aggregate amount shall be reduced by the sum of (in each case to the extent the following would otherwise be required to be capitalized on the Consolidated balance sheet of the Borrower and its Subsidiaries) (a) proceeds received from the sale of fixed or capital assets which have been applied, within one year of receipt thereof, to the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful
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in the business of the Borrower and its Subsidiaries; (b) insurance or requisition proceeds or condemnation awards received in connection with the damage, destruction, requisition or condemnation of fixed or capital assets which have been applied, within one year of receipt thereof, to the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful in the business of the Borrower and its Subsidiaries; (c) proceeds of indemnity claims made by Holdings or the Borrower pursuant to the Acquisition Agreement to the extent used in connection with the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful in the business of the Borrower and its Subsidiaries in connection with such indemnity claim; (d) with regard to equipment purchased simultaneously with the trade-in of existing equipment of the Borrower or its Subsidiaries, the amount of the credit extended for such trade-in; and (e) expenditures for vessels identified to be sold by the Borrower or any of its Subsidiaries and then leased-back (on an operating lease basis) by the Borrower or any of its Subsidiaries to the extent that such sale occurs within 180 days of the completion of such vessel and the Borrower has notified the Lenders in writing in reasonable detail of the timing, facts and circumstances of such sale and lease-back to the extent that the aggregate amount of such expenditures does not exceed $15,000,000 at any time ( provided that if any vessel so identified is not sold, the amount of the expenditures made that relate to such vessel shall be added back to the amount of Capital Expenditures for the Fiscal Quarter in which such expenditure was made), and (f) the repurchase of the vessels set forth on Schedule 6.3(a) for the amounts set forth on Schedule 6.3(a) . Anything herein to the contrary notwithstanding, Capital Expenditures shall not include expenditures made as consideration or purchase price for Permitted Business Acquisitions.
Capital Stock means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) including, without limitation, membership interests and partnership interests or units, and any and all warrants, rights or options to purchase any of the foregoing.
Capitalized Lease means, with respect to any Person, any lease of any property by that Person as lessee, the obligation for Rentals with respect to which is required to be accounted for as a capital lease on the balance sheet of such person in accordance with GAAP.
Capitalized Rentals means, as of the date of any determination, the amount at which the aggregate Rentals due and to become due under all Capitalized Leases under which the Borrower or any of its Subsidiaries is a lessee would be reflected as a liability on a consolidated balance sheet of the Borrower and its Subsidiaries.
CERCLA has the meaning specified in the definition of Environmental Laws .
Claims means any claim or demand, by any Person, of whatsoever kind or nature for any alleged Liabilities and Costs, whether based in contract, tort, implied or
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express warranty, strict liability, criminal or civil statute, Permit, ordinance or regulation, common law or otherwise.
Closing Date means the date on which all of the conditions precedent set forth in Section 4.1 are satisfied or waived by all of the Lenders.
Code means the Uniform Commercial Code of the State of New York.
Collateral means all Property and interests in Property now owned or hereafter acquired by Holdings or any of its Subsidiaries in or upon which a Lien is granted under the Collateral Documents.
Collateral Documents means the First Preferred Fleet Mortgage, the Second Preferred Fleet Mortgage, the Note Pledge Agreement, the Equipment Security Agreements, the Receivables Security Agreements, the Proceeds Agent Agreement, financing statements and all other similar agreements, assignments, instruments and documents delivered to the Administrative Agent from time to time to create, evidence or perfect Liens securing the Obligations, and all amendments, supplements, modifications, renewals, replacements, restatements, consolidations, substitutions, and extensions of any of the foregoing.
Commitment shall mean collectively, the Revolving Commitments and the Tranche B Term Commitments, or with respect to any Lender, such Lenders Revolving Commitment and Tranche B Term Commitment.
Commitment Fee shall have the meaning specified in Section 2.14(a) .
Compliance Certificate shall have the meaning specified in Section 6.4(d) .
Contaminant means any waste, pollutant, hazardous substance, radioactive substance or material, toxic substance, hazardous waste, radioactive waste, special waste, petroleum or petroleum-derived substance or waste, asbestos in any form or condition, polychlorinated biphenyls (PCBs), or any hazardous or toxic constituent thereof and includes, but is not limited to, these terms as defined in any Environmental Law.
Continuation/Conversion Notice shall have the meaning specified in Section 2.6 .
Continuing Directors means, as of any date of determination, any member of the Board of Directors of the Borrower who (i) was a member of such Board of Directors as of the Closing Date, (ii) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election, or (iii) receives the vote of the Principals in his or her election by the shareholders of the Borrower.
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Contribution Agreement means the Contribution and Indemnification Agreement executed and delivered pursuant to Section 4.1 among each of the Guarantors.
Control Investment Affiliate means, as to any Person, any other Person that (a) directly or indirectly, is in control of, is controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of making equity or debt investments in one or more companies. For purposes of this definition, control of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.
CSFB has the meaning specified in the preamble .
Customary Permitted Investment means, at any time, Investments of the Borrower or any of its Subsidiaries in (a) any obligation, maturing not more than one year after such time, issued or guaranteed by the United States Government or issued by an agency thereof and backed by the full faith and credit of the United States of America; (b) marketable general obligations, maturing not more than six months after such time, issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof and rated A-2 by Standard & Poors Rating Group, a division of McGraw Hill Inc. or P-2 or higher by Moodys Investors Service, Inc.; (c) commercial paper, maturing not more than nine months from the date of issue, which is issued by (i) a corporation (other than an Affiliate of any Loan Party) organized under the laws of any state of the United States or of the District of Columbia and rated A-2 or higher by Standard & Poors Rating Group, a division of McGraw Hill Inc. or P-2 by Moodys Investors Service, Inc., or (ii) any Lender (or its holding company); (d) any certificate of deposit, time or demand deposit (including Eurodollar time deposits) or bankers acceptance, maturing not more than one year after such time, which is issued by either (i) a commercial banking institution organized under the laws of the United States of America or any State thereof or the District of Columbia that has a combined capital, surplus and undivided profits of not less than $500,000,000, (ii) any Lender, or (iii) any branch of any Lender or any commercial banking institution organized under the laws of the United Kingdom, Canada or Japan having combined capital, surplus and undivided profits of not less than $500,000,000; (e) fully collateralized repurchase agreements with a term of not more than 30 days for underlying securities of the type described in clauses (a) and (b) above, entered into with any institution meeting the qualifications specified in clause (d) above; (f) participation in loans made to a borrower (other than an Affiliate of any Loan Party) with a debt rating of A-2 or higher from Standard & Poors Rating Group, a division of McGraw Hill Inc. or P-2 or higher from Moodys Investor Service, Inc.; provided , however , that such loans must mature within six months from the date such participation is purchased; (g) short-term asset management accounts offered by any Lender for the purpose of investing in notes issued by a corporation (other than an Affiliate of any Loan Party) organized under the laws of any state of the United States or of the District of Columbia and rated A-2 or higher by Standard & Poors Rating Group, a division of McGraw Hill, Inc. or P-2 or higher by Moodys Investors Service, Inc.; or (h) bonds issued by a municipality or governmental agency and rated not lower than BBB by Standard & Poors Rating Group,
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a division of McGraw Hill, Inc. or Baa2 by Moodys Investors Service, Inc. and purchased by the Borrower or any of its Subsidiaries in the ordinary course of its business in connection with retainage under contracts with its customers; or (i) United States Dollars or money in other currencies received in the ordinary course of business; or (j) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) through (e), (i) and (j) of this definition; or (k) securities with maturities of one year or less from the date of acquisition issued or fully and unconditionally guaranteed by any state, commonwealth or territory of the United States of America or the federal government of Canada, or by any political subdivision or taxing authority thereof, and having one of the two highest ratings obtainable from Standard & Poors Rating Group, a division of McGraw Hill Inc., or Moodys Investors Service, Inc.; or (l) in the case of any Subsidiary of the Borrower that is not a domiciled in the United States, investments comparable to the foregoing that have been approved by the Administrative Agent.
Customary Permitted Liens means:
(a) Liens (other than those arising with respect to any noncompliance with ERISA or Environmental Laws) for taxes, assessments or governmental charges, but only to the extent that such taxes, assessments or charges are either not delinquent or are being contested in good faith by appropriate proceedings, and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(b) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen, suppliers and other Liens imposed by law (including maritime law) created in the ordinary course of business of the Borrower and its Subsidiaries, but only to the extent that the amounts secured or to be secured by such Liens are either not overdue or are being contested in good faith and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(c) Liens (other than any Lien imposed by ERISA or Environmental Laws) incurred or deposits (including, without limitation, security deposits) made in the ordinary course of the Borrowers business or any of its Subsidiaries businesses (including, without limitation, surety bonds and appeal bonds) in connection with workers compensation, unemployment insurance and other types of social security benefits or to secure the performance of tenders, bids, contracts (other than for the repayment of borrowed money or to stay a judgment pending an appeal thereof), statutory obligations and other similar obligations or arising as a result of progress payments under government contracts, but only to the extent that the amounts secured or to be secured by such Liens are either not delinquent or are being contested in good faith and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(d) survey exceptions or encumbrances, easements or reservations, or rights of others for rights-of-way, utilities and other similar purposes, or zoning or
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other restrictions as to the use of real property, which do not materially interfere with the ordinary conduct of the business of the Borrower and its Subsidiaries; and
(e) Liens of or resulting from any judgment or award, other than any judgment or award that gives rise to an Event of Default, the time for appeal or petition for rehearing of which shall not have expired, or in respect of which the Borrower or any of its Subsidiaries shall at any time in good faith be prosecuting an appeal or proceeding for a review and in respect of which a stay of execution pending such appeal or proceeding for review shall have been secured.
Debt means and includes, with respect to any Person, (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds (including, without limitation, license, bid, performance, lien or payment bonds), debentures, notes or other similar instruments, (iii) obligations which have been incurred in connection with the acquisition of property or services (including, without limitation, obligations to pay the deferred purchase price of property or services), excluding trade payables and accrued expenses incurred in the ordinary course of business, (iv) obligations secured by any Lien or other charge upon property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such obligations, (v) obligations created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person, notwithstanding the fact that the rights and remedies of the seller, lender or lessor under such agreement in the event of default are limited to repossession or sale of property, (vi) the principal amount of Capitalized Rentals under any Capitalized Lease, (vii) reimbursement obligations with respect to letters of credit, and (viii) obligations under direct or indirect guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations of others of the kinds referred to in clauses (i) through (vii) above. For the avoidance of doubt, notwithstanding FAS 150, the Capital Stock of Holdings issued in connection with the Initial Capital Contribution, and all other Capital Stock issued by Holdings thereafter having substantially the same terms, shall not constitute Debt (including for the purpose of calculation the covenants in Section 6.3 ) so long as such Capital Stock does not require any cash payments or dividends thereon or require any mandatory redemption or repurchase prior to the date one year after the maturity of the Obligations. Debt shall not include obligations under the Existing Notes to the extent that the Existing Notes that have been tendered prior to the Closing Date have been retired or repurchased in full in accordance with the Trust Indenture Act and the terms of the Existing Notes Indenture, and the Administrative Agent and the Arrangers in satisfaction of the conditions precedent of this Agreement have received evidence reasonably satisfactory to them either that (x) an amount sufficient to redeem the remaining Existing Notes not so retired or repurchased prior to the Closing Date has been irrevocably deposited with The Bank of New York, as trustee under the Existing Notes Indenture, in accordance with the terms of the Existing Note Indenture for the purpose of redeeming the remaining Existing Notes or (y) the remaining Existing Notes have been otherwise irrevocably called for redemption, repurchase or retirement and the amounts required for such redemption, repurchase or retirement irrevocably committed, set aside and/or defeased, as may be agreed upon
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among the Administrative Agent, the Arrangers and the Borrower, for the purpose of effecting such redemption, repurchase or retirement.
Default means an event which, with the lapse of time or the giving of notice, or both, would be an Event of Default.
Defaulting Lender has the meaning specified in Section 2.4(c) .
Default Rate has the meaning specified in Section 2.9.2 .
Deposit has the meaning specified in Section 7.2 .
Designated Vessel means (i) all vessels owned by the Borrower or any of its Subsidiaries and documented under the federal laws of the United States of America, (ii) any vessels, whether or not documented in compliance with clause (i) , with a book value of at least $750,000 owned as of the Closing Date or thereafter acquired by the Borrower or any of its Subsidiaries, and (iii) any vessels constituting Collateral.
Disposition means with respect to any Property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof; and the terms Dispose and Disposed of shall have correlative meanings.
DOL means the United States Department of Labor.
Dollars and the sign $ each means lawful money of the United States of America.
Domestic Lending Office means, with respect to any Lender, the office of such Lender specified as its Domestic Lending Office on Schedule 1 to the Lender Addendum of such Lender or in the Assignment and Acceptance pursuant to which it became a Lender, or such other office of such Lender as such Lender may from time to time specify to the Borrower and the Administrative Agent.
EBITDA means, with respect to any period, as determined in accordance with GAAP, the sum of the amounts for such period of Net Income, (a) plus , without duplication and to the extent reflected as a charge in the consolidated statement of such Net Income for such period: (i) depreciation, depletion and amortization expense, (ii) federal, state, local and foreign income taxes, (iii) Interest Expense, (iv) transaction fees and expenses incurred in connection with the Transactions to the extent not exceeding in the aggregate $17,000,000, (v) non-cash charges and losses, (vi) any amounts included in the calculation of Net Income for amortization or non-cash charges for the write-off or impairment of goodwill, intangibles or other purchase accounting adjustments related to the accounting for the Transactions or other acquisitions under GAAP (including Financial Accounting Standards No. 141 and 142), (vii) fees and expenses incurred in connection with the Bonding Agreement and the Equipment Financing Debt, (viii) management fees paid pursuant to any Management Agreement to the extent permitted to be paid hereunder, and (ix) Net Income attributable to the minority equity interest in NASDI that is not owned by the Borrower to the extent the Net
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Income in respect of such minority equity interest is received by the Borrower, and (b) minus , without duplication, (i) non-cash gains. EBITDA for the Borrower and its Subsidiaries for the fiscal quarters ended December 31, 2002, March 31, 2003, June 30, 2003 and September 30, 2003 shall be deemed to be $15,369,000, $15,164,000, $13,147,000 and $15,403,000, respectively.
Employment Agreements means those certain employment agreements now existing between the Borrower and each of Douglas B. Mackie and Richard Lowry, respectively, as the same may be amended, supplemented or otherwise modified from time to time.
Environmental Claim means all claims, however asserted, by any Governmental Authority or other Person alleging potential or actual liability under Environmental Laws or responsibility for violation of any Environmental Law or for release or injury to the environment or threat to public health, personal injury (including sickness, disease or death), property damage, natural resources damage, or otherwise alleging liability or responsibility for damages (punitive or otherwise), cleanup, removal, remedial or response costs, restitution, civil or criminal penalties, injunctive relief, or other type of relief, resulting from or based upon (a) the presence, placement, or Release (including intentional and unintentional, negligent and non-negligent, sudden or non-sudden, accidental or non-accidental or Releases) of any Hazardous Material at, in, or from Property, whether or not owned by the Borrower, or (b) any other circumstances forming the basis of any violation, or alleged violation, of any Environmental Law.
Environmental Laws means all international, foreign, federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative or judicial orders, licenses, authorizations and permits of, and agreements with, any Governmental Authorities, in each case relating to environmental, health, safety and land use and natural resource matters now or hereafter in effect; including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), the Clean Air Act, the Federal Water Pollution Control Act of 1972, the Solid Waste Disposal Act, as amended, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, and the Emergency Planning and Community Right-to-Know Act, and the Occupational Safety and Health Act, and any analogous state or local laws.
Equipment Financing Debt means Debt incurred pursuant to the Credit Agreement dated December 17, 2003 between General Electric Capital Corporation and Great Lakes to finance certain equipment of the Borrower and the Subsidiary Guarantors existing on the Closing Date as refinanced or replaced in whole or in part, from time to time, as permitted hereunder.
Equipment Security Agreements means the Lender Equipment Security Agreements referred to and as defined in the Intercreditor Agreement.
ERISA means the Employee Retirement Income Security Act of 1974, as amended.
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ERISA Affiliate means any (a) corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the IRC) as the Borrower, (b) partnership or other trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the IRC) with the Borrower, and (c) member of the same affiliated service group (within the meaning of Section 414(m) of the IRC) as the Borrower, any corporation described in clause (a) above or any partnership or trade or business described in clause (b) above.
Eurodollar Office means, with respect to any Lender, the office of such Lender specified as its Eurodollar Office on Schedule 1 to the Lender Addendum of such Lender or in the Assignment and Acceptance pursuant to which it became a Lender (or, if no such office is specified, its Domestic Lending Office), or such other office of such Lender as such Lender may from time to time specify to the Borrower and the Administrative Agent.
Eurodollar Rate (Adjusted) means, relative to any portion of a Loan to be made, continued, or maintained as, or converted into, a Eurodollar Rate Loan for any Interest Period, a rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) determined pursuant to the following formula:
Eurodollar Rate |
= |
IBO Rate |
(Adjusted) |
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1 - the Eurodollar Reserve Percentage. |
Eurodollar Rate Loan means a Loan bearing interest, at all times during the Interest Period applicable to such Loan, at a rate of interest determined by reference to the Eurodollar Rate (Adjusted).
Eurodollar Reserve Percentage means, relative to each Interest Period, a percentage (expressed as a decimal) equal to the daily average during such Interest Period of the percentages in effect on each day of such Interest Period, as prescribed by the Federal Reserve Board, for determining the maximum reserve requirements applicable to Eurocurrency liabilities pursuant to Regulation D or any other applicable regulation of the Federal Reserve Board which prescribes reserve requirements applicable to Eurocurrency liabilities as currently defined in Regulation D.
Events of Default has the meaning specified in Section 7.1 .
Existing Credit Agreement has the meaning specified in the recitals .
Existing L/Cs has the meaning specified in Section 3.11 .
Existing Lenders has the meaning specified in the recitals .
Existing Note Indenture means that certain Indenture dated as of August 19, 1998 between The Bank of New York, as trustee, and the Borrower and certain Subsidiaries of the Borrower.
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Existing Notes means the Borrowers 11.25% Senior Subordinated Notes due 2008.
Facility means each of (a) the Tranche B Term Commitments and the Term Loans made thereunder (the Tranche B Term Loan Facility ) and (b) the Revolving Commitments and the extensions of credit made thereunder (the Revolving Credit Facility ).
Federal Funds Rate means, for any period, the rate set forth in the weekly statistical release designated as H.l5(519), or any successor publication, published by the Federal Reserve Board (including any such successor, H.15(519)) for such day opposite the caption Federal Funds (Effective). If on any relevant day such rate is not yet published in H.15(519), the rate for such day will be the rate set forth in the daily statistical release designated as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or any successor publication, published by the Federal Reserve Bank of New York (including any such successor, the Composite 3:30 p.m. Quotation) for such day under the caption Federal Funds Effective Rate. If on any relevant day the appropriate rate for such previous day is not yet published in either H.15(5l9) or the Composite 3:30 p.m. Quotation, the rate for such day will be the arithmetic mean of the rates for the last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New York time) on that day by each of three leading brokers of Federal funds transactions in New York City selected by the Administrative Agent.
Federal Reserve Board means the Board of Governors of the Federal Reserve System, or any successor thereto.
Financial Letter of Credit means any standby letter of credit issued pursuant to this Agreement, other than a Performance Letter of Credit.
First Preferred Fleet Mortgages means the Lender First Ship Mortgage referred to and as defined in the Intercreditor Agreement.
Fiscal Quarter means any quarter of any Fiscal Year.
Fiscal Year means the Fiscal Year of the Loan Parties consisting of a period of twelve consecutive months ending on December 31.
Foreign Currency Contract has the meaning specified in Section 6.1(o) .
GAAP means generally accepted accounting principles set forth in the rules, regulations, statements, opinions and pronouncements of the American Institute of Certified Public Accountants and of the Financial Accounting Standards Board (or agencies with similar functions of comparable stature and authority within the accounting profession), except as provided in the definitions of Debt and Interest Expense in respect of the treatment of Capital Stock of Holdings pursuant to Statement of Financial Accounting Standards No. 150 (FAS 150), which, subject to Section 1.4 , are applicable to the circumstances as of the date of determination.
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Governmental Authority means any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.
Granting Lender has the meaning specified in Section 9.7 .
Great Lakes means Great Lakes Dredge & Dock Company, a New Jersey corporation and a wholly-owned Subsidiary of the Borrower.
Guaranties by any Person shall mean all obligations (other than endorsements in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any Debt, dividend or other obligation, of any other Person (the Primary Obligor ) in any manner, including, without limitation, all obligations incurred through an agreement, contingent or otherwise, by such Person: (i) to purchase such Debt or obligation or any property or assets constituting security therefor, (ii) to advance or supply funds (x) for the purchase or payment of such Debt or obligation or (y) to maintain working capital or other balance sheet condition or otherwise to advance or make available funds for the purchase or payment of such Debt or obligation, or (iii) to lease property or to purchase Securities or other property or services primarily for the purpose of assuring the owner of such Debt or obligation of the ability of the Primary Obligor to make payment of the Debt or obligation, or (iv) otherwise to assure the owner of the Debt or obligation of the Primary Obligor against loss in respect thereof. For the purposes of all computations made under this Agreement, a Guaranty in respect of any Debt for borrowed money shall be deemed to be Debt equal to the principal amount of such Debt for borrowed money which has been guaranteed (or the aggregate amount of such Debt which is guaranteed under such Guaranty, whichever is less), and a Guaranty in respect of any other obligation or liability or any dividend shall be deemed to be Debt equal to the maximum aggregate amount of such obligation, liability or dividend so guaranteed. Guaranties shall not include reimbursement obligations with respect to letters of credit but shall include guaranties of reimbursement obligations with respect to such letters of credit.
Guarantors means the collective reference to Holdings and the Subsidiary Guarantors.
Hazardous Materials means all those substances, materials or wastes, which are regulated by, or which may form the basis of liability under, any Environmental Law, including all substances, materials or wastes identified under any Environmental Law as a hazardous waste, hazardous constituent, special waste, hazardous substance, hazardous material, or toxic substance, pollutant, contaminant or words of similar meaning, asbestos, or petroleum, including crude oil or any fraction thereof, and all substances identified under CERCLA as hazardous.
Holdings has the meaning specified in the preamble .
IBO Rate means, relative to the Interest Period for each Eurodollar Rate Loan comprising all or any part of the same Borrowing, the rate of interest determined by
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the Administrative Agent to be (rounded upwards, if necessary, to the nearest 1/100 of 1%) the rate per annum at which deposits in Dollars in immediately available funds are offered to the Administrative Agents Eurodollar Office in the interbank Eurodollar market as at or about 11:00 a.m., Chicago time, two (2) Business Days prior to the beginning of such Interest Period, for delivery on the first day of such Interest Period, in an amount approximately equal or comparable to the amount of Bank of Americas Eurodollar Rate Loan comprising part of such Borrowing and for a period equal to such Interest Period.
Impermissible Qualification means, relative to the opinion or certification of any independent public accountant as to any financial statements of the Borrower and its Subsidiaries, any qualification or exception to such opinion or certification: (a) which is of a going concern or similar nature, (b) which relates to the limited scope of examination of matters relevant to such financial statement, or (c) which relates to the treatment or classification of any item in such financial statements and which, as a condition to its removal, would require an adjustment to such item the effect of which would be to cause any violation of Section 6.3 .
Indemnified Liabilities has the meaning specified in Section 9.4 .
Indemnitee has the meaning specified in Section 9.4 .
Initial Capital Contribution means cash equity capital contributions by shareholders of Holdings in an aggregate amount of not less than $96,700,000, which amount shall subsequently be contributed by Holdings to the capital of the Borrower.
Intercreditor Agreement means the Intercreditor Agreement of even date herewith by and among the Administrative Agent, the Borrower, Great Lakes, Dawson Marine Services Company, Fifty-Three Dredging Corporation, NASDI, Travelers, the other Sureties and Great Lakes Entities party thereto and referred to and defined therein, as amended, restated, supplemented or otherwise modified from time to time.
Interest Expense means, for any Fiscal Quarter, the aggregate consolidated interest expense (net of interest income) of the Borrower and its consolidated Subsidiaries for such Fiscal Quarter, as determined in accordance with GAAP, including (i) Commitment Fees paid or payable during such Fiscal Quarter, (ii) all other fees paid or payable with respect to the issuance or maintenance of any Guaranty or contingent Debt (including Letters of Credit but excluding fees paid under the Bonding Agreement), which, in accordance with GAAP, would be included as interest expense, (iii) net costs or benefits under any Rate Protection Agreement (excluding the costs of any commodity hedging transaction or foreign currency hedging transaction other than a foreign currency hedging transaction on account of Section 6.1(o) ) and (iv) the portion of any payments made in respect of Capitalized Rentals of the Borrower and its consolidated Subsidiaries allocable to interest expense, but excluding any amortization of costs and expenses incurred in connection with, and relating to, this Agreement or other financings permitted by this Agreement. For the avoidance of doubt, Interest Expense shall not include any non-cash dividends or other non-cash payments in respect of any
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Capital Stock of Holdings that is not included in the definition of Debt pursuant to the last sentence of such definition.
Interest Period means, relative to any Eurodollar Rate Loan, the period from the date on which such Eurodollar Rate Loan is made or continued as, or converted into, a Eurodollar Rate Loan pursuant to Section 2.4 or 2.6 as the case may be, and, unless the maturity of such Eurodollar Rate Loan is accelerated, the day which numerically corresponds to such date one, two, three, six or (if available to all applicable Lenders) nine or twelve months thereafter, as the Borrower may select in its relevant notice pursuant to Section 2.4 or 2.6 , as the case may be; provided that:
(a) the Borrower shall not be permitted to select Interest Periods to be in effect at any one time which have expiration dates occurring on more than ten different dates;
(b) if there exists no numerically corresponding day in such month, such Interest Period shall end on the last Business Day of such month;
(c) if such Interest Period would otherwise end on a day which is not a Business Day, such Interest Period shall end on the next following Business Day (unless such next following Business Day is a Business Day falling in a new calendar month, in which case such Interest Period shall end on the Business Day next preceding such numerically corresponding day); and
(d) the Borrower shall not be permitted to select, and there shall not be applicable, any Interest Period that would end later than the Revolving Commitment Termination Date.
Investment means, as applied to any Person, any purchase or other acquisition by that Person of Securities or Debt, or of a beneficial interest in Securities or Debt, of any other Person, any loan, advance (other than deposits with financial institutions available for withdrawal on demand, prepaid expenses, advances to employees, officers and directors and similar items made or incurred in the ordinary course of business), capital contribution by that Person to any other Person, and all other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. The amount of any Investment shall be determined in conformity with GAAP. The amount of any Investment shall be the original principal or capital amount thereof less all returns of principal or equity thereon.
IRC means the Internal Revenue Code of 1986, as amended.
IRS means the Internal Revenue Service.
Issuing Lender means any Lender designated by the Borrower and consenting to such Designation as an Issuing Lender, including, as of the Closing Date, Bank of America, as specified in the preamble .
LCPI means Lehman Commercial Paper Inc.
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Lehman Brothers has the meaning specified in the preamble .
Lender Addendum means, with respect to any initial Lender, a Lender Addendum, substantially in the form of Exhibit J , to be executed and delivered by such Lender on the Closing Date as provided in Section 9.17 .
Lender First Proceeds Account has the meaning specified in the Intercreditor Agreement.
Lenders means the institutions listed on the signature pages hereof and each institution that shall become a party hereto pursuant to Section 9.7 .
Letters of Credit has the meaning specified in Section 3.1
Letter of Credit Availability means, at any time of determination, an amount (determined on a Dollar equivalent basis) equal to the lesser of (a) the Revolving Commitment Amount then in effect minus the then outstanding principal balance of the Loans and (b) $30,000,000.
Letter of Credit Fee has the meaning specified in Section 3.3 .
Letter of Credit Obligations means at any time, but without duplication, an amount (determined on a Dollar equivalent basis) equal to the sum of (a) the aggregate amount available to be drawn under outstanding Letters of Credit, plus (b) all amounts drawn, but not yet reimbursed, under Letters of Credit.
Letter of Credit Request has the meaning specified in Section 3.2 .
Liabilities and Costs means all liabilities, obligations, responsibilities, losses, damages, punitive damages, consequential damages, treble damages, reasonable out-of-pocket costs and expenses (including, without limitation, Attorney Costs, expert and consulting fees and costs of investigation and feasibility studies), fines, penalties and monetary sanctions, interest, direct or indirect, known or unknown, absolute or contingent, past, present or future.
Lien means any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, security interest, encumbrance for the payment of money, lien (statutory or other), preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement, the interest of a lessor under a capital lease, any financial lease having substantially the same economic effect as any of the foregoing and the filing of any financing statement (other than a financing statement filed by a true lessor pursuant to Section 9-408 of the Code or other comparable law of any jurisdiction) naming the owner of the asset to which such Lien relates as debtor under the Code or other comparable law of any jurisdiction but excluding unauthorized financing statements filed under the UCC (or any similar law) with respect to which no security interest exists in the assets described in such financing statements.
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Loans means, collectively, Revolving Loans and Tranche B Term Loans.
Loan Documents means this Agreement, the Notes, the Letters of Credit, the Loan Party Guaranties, the Contribution Agreement, the Intercreditor Agreement, the Collateral Documents, all material agreements, instruments and documents which creates or perfects any of the Liens securing the Obligations or create any obligation between any Loan Party and the Administrative Agent or any Lender, each Notice of Borrowing, Notice of Conversion/Continuation, Letter of Credit Request, Closing Certificate, Compliance Certificate, and all documents and instruments that are agreed by the Borrower and the Administrative Agent to constitute a Loan Document hereunder heretofore, now or hereafter executed by or on behalf of any Loan Party and delivered to or for the benefit of the Administrative Agent or any Lender in connection with this Agreement, and all amendments, supplements, modifications, renewals, replacements, restatements, consolidations, substitutions, and extensions of any of the foregoing.
Loan Party means the Borrower, each Guarantor and each other Affiliate of the Borrower executing a Loan Document.
Loan Party Guaranties means the Guaranties of even date herewith executed and delivered pursuant to Section 4.1 , pursuant to which Holdings and the respective Subsidiary Guarantors fully, unconditionally and irrevocably guaranty the prompt and complete payment and performance of the Obligations of the Borrower, as amended, restated, supplemented or otherwise modified from time to time.
Majority Facility Lenders means, with respect to any Facility, the holders of more than 50% of the aggregate unpaid principal amount of Tranche B Term Loans or the Total Revolving Extensions of Credit, as the case may be outstanding under such Facility (or, in the case of the Revolving Credit Facility, prior to any termination of the Revolving Commitment, the holders of more than 50% of the aggregate amount of the Revolving Commitment).
Majority Lenders means, at any time, the Lenders having, in the aggregate, a Percentage of more than 50% of the total Percentages of all of the Lenders at such time.
Majority Revolving Credit Facility Lenders means the Majority Facility Lenders in respect of the Revolving Credit Facility.
Management Agreement means any management agreement between the Principals and the Loan Parties entered into after the Closing Date and reasonably approved by the Administrative Agent and the Arrangers.
Mandatory Prepayment Amount has the meaning set forth in Section 2.8.2(b).
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Material Adverse Effect means (a) a material adverse effect upon (i) the Acquisition, (ii) the condition (financial or otherwise), operating results, assets, liabilities, business or operations of Holdings, the Borrower and its Subsidiaries, taken as a whole, or (iii) the validity or enforceability of any of the Loan Documents, the Liens granted to the Administrative Agent and the Secured Parties, or the rights and remedies of the Administrative Agent and the Lenders thereunder.
MDP has the meaning specified in the recitals.
Merger Sub means GLDD Merger Sub, Inc., a Delaware corporation.
Multiemployer Plan means a multiemployer plan as defined in Section 4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years was, contributed to by the Borrower or any ERISA Affiliate.
NASDI means North American Site Developers, Inc., a Massachusetts corporation.
NASDI Acquisition Note means, collectively, those certain Junior Subordinated Promissory Notes dated as of April 24, 2001 in an aggregate initial principal amount of $3,000,000 executed and delivered by NASDI Newco (and assumed by NASDI by operation of the NASDI Merger) and made payable to certain of the former non-management stockholders of NASDI.
Net Cash Proceeds means the gross cash proceeds received by the Borrower and its Subsidiaries in connection with the consummation of any of the transactions of the type resulting in a mandatory prepayment under clauses (c), (d) or (e) of Section 2.8.1 , in any such case, net of all fees, expenses, charges, taxes, commissions and costs incurred by the Borrower or any of its Subsidiaries in connection with the consummation of such transactions.
Net Income means, for any period, the aggregate of all amounts (exclusive of all amounts in respect of any extraordinary or non-recurring gain or loss) which, in accordance with GAAP, would be included as net income on a consolidated statement of income of the Borrower and its Subsidiaries for such period.
Non-Consenting Lender has the meaning specified in Section 9.1 .
Note Indenture means that certain Indenture dated as of December22, 2003 between The Bank of New York, as trustee, and the Borrower and the Subsidiary Guarantors, pursuant to which the Borrower has consummated the Note Issuance.
Note Indenture Obligations means all of (a) (i) the Borrowers obligations under and with respect to the Note Indenture and the Note Issuance, including, without limitation, all obligations to pay principal, interest, premium, fees, charges, expenses and indemnities with respect thereto, and to effect redemptions, repurchases and prepayments with respect thereto, in any case, whether fixed, contingent, matured or unmatured and (ii) the Borrowers Subsidiaries guaranty obligations with
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respect to the obligations of the Borrower described in clause (a)(i) , or (b) the Borrowers obligations under and with respect to such other note indenture and note issuance, the proceeds of which are used to refinance the Note Issuance, (i) pursuant to a note indenture containing covenants, events of default and other terms less restrictive as to the Borrower and its Subsidiaries than those set forth in this Agreement, not including any maintenance covenants, and which is otherwise customary, including, without limitation, the subordination provisions which shall be satisfactory to the Administrative Agent at the Arrangers thereof, for senior subordinated notes issued at such time under comparable circumstances by issuers of similar credit quality, (ii) the initial scheduled principal repayment date of such note issuance shall be at least one year and one day beyond the Term Loan B Maturity Date, (iii) the interest rate applicable to such note issuance shall be a rate that is lower than the senior subordinated notes issued by the Borrower pursuant to the Note Issuance, (iv) such note issuance shall not require the consent of any holder thereof with respect to any amendment or other modification of any Loan Document, (v) the note indenture with respect to such note issuance shall otherwise contain terms and conditions reasonably satisfactory to the Majority Lenders.
Note Issuance means the issuance on December 22, 2003 by the Borrower of $175,000,000 in original aggregate principal amount of its 7 3/4% Senior Subordinated Notes due December 15, 2013 pursuant to the Note Indenture.
Note Pledge Agreement means the Lender Pledge Agreement referred to and as defined in the Intercreditor Agreement.
Notes means the promissory notes made by the Borrower and delivered to each Lender evidencing such Lenders Loans and participations in Letters of Credit.
Notice of Borrowing has the meaning specified in Section 2.4 .
Obligations means all loans, advances, debts, liabilities, obligations, covenants and duties of any kind or nature, present or future, owing by any Loan Party to any Lender, the Administrative Agent, or any Affiliate of any Lender or the Administrative Agent, or Person entitled to indemnification pursuant to this Agreement, whether evidenced by any note, guaranty or other instrument, arising under this Agreement or under any other Loan Document or any Rate Protection Agreement between any Loan Party and a Lender or any Person that was an Affiliate of a Lender at the time of the entry into of such Rate Protection Agreement, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification, interest rate hedging transaction, commodity hedging transaction, foreign currency hedging transaction or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired. The term includes, without limitation, all interest (including, without limitation, interest accruing after the maturity of the Loans and Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), charges, expenses, fees, Attorney Costs
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and any other sum chargeable to any Loan Party under this Agreement or any other Loan Document. Unless otherwise specified in this Agreement, any determination of the amount of outstanding Obligations shall be made on a Dollar equivalent basis.
OLV has the meaning specified in Section 6.1(p) .
Other Taxes has the meaning specified in Section 2.16(b) .
Participant has the meaning specified in Section 9.7 .
PBGC means the Pension Benefit Guaranty Corporation.
Percentage means, relative to any Lender, its percentage of the Commitments as set forth on Schedule 1 to the Lender Addendum of such Lender, or if such Lender has entered into an Assignment and Acceptance, the percentage set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 9.7(d) .
Performance Letter of Credit means any standby letter of credit issued pursuant to this Agreement to assure completion of performance of a nonfinancial or commercial obligation of Borrower or any of its Subsidiaries, until such time, if any, as such letter of credit is recharacterized as relating to a financial obligation of the Borrower or such Subsidiaries.
Permit means any permit, approval, authorization, license, variance, or permission required from any Governmental Authority under any Applicable Law.
Permitted Business Acquisition means any acquisition by the Borrower or any of its Subsidiaries of all or any part of the assets, shares or other equity interests in a corporation or other Person engaged in the same business or a business reasonably related, complimentary or incidental to the business of the Borrower or any of its Subsidiaries but only if no Default or Event of Default shall have occurred or be continuing immediately prior to such acquisition or after giving effect thereto.
Permitted Capital Stock Issuance means (i) sales and issuances of the Capital Stock of Holdings to officers, directors and employees of the Borrower and its Subsidiaries not exceeding in the aggregate for all such issuances $5,000,000, (ii) sales and issuances of the Capital Stock of Holdings to the Principals, and (iii) sales and issuances of the Capital Stock of Holdings to the seller in any Permitted Business Acquisition not exceeding in the aggregate for all such issuances $1,000,000.
Permitted Disposition means any Disposition of any assets of the Borrower or any of its Subsidiaries, whether in a single transaction or a series of related transactions, to any Person, but only if
(a) such Disposition of property which is not Collateral and which is (i) made in the ordinary course of business of the Borrower or such Subsidiary, (ii) is a Disposition from (A) the Borrower to any of its Subsidiary Guarantors or
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from a Subsidiary Guarantor to the Borrower or to another Subsidiary Guarantor, or (B) (x) the Borrower or any Subsidiary Guarantor to a Subsidiary of the Borrower which is not a Subsidiary Guarantor, or (y) from a Subsidiary of the Borrower which is not a Subsidiary Guarantor to any other such Subsidiary, provided that, in the case of clause (B)(x), the aggregate amount of all such Permitted Dispositions (other than renewals and extensions of the leases and subleases set forth on Schedule V) made after the Closing Date does not exceed $15,000,000 (net of the fair market value of any property received in exchange for such Dispositions), (iii) is a sale, lease or transfer to another Person of assets determined by the Borrower or such Subsidiary, in its reasonable judgment, to be no longer useful or necessary in the operations or businesses of the Borrower or such Subsidiaries (it being understood that committing a vessel and related equipment of the Borrower or any of its Subsidiaries to the performance of a contract to which it is a party shall not constitute a lease of such vessel and related equipment), or (iv) is a Disposition of any property or assets that secure any Indebtedness permitted by Section 6.2(i) , including any Recovery Event with respect to such property or assets;
(b) such Disposition is made in connection with a sale and leaseback transaction involving the Disposition of capital assets (other than Collateral, unless the disposition of such Collateral also complies with clause (iii) of subparagraph (c) of this definition) of the Borrower or any of its Subsidiaries to a Person other than the Borrower or any of its Subsidiaries and (i) such Disposition of such capital assets is for an amount not less than the fair market value thereof (as determined by the Borrower or such Subsidiary in its reasonable judgment), (ii) no Default or Event of Default shall have occurred or be continuing either immediately prior to such disposition or after giving effect thereto, (iii) the rental payments of the lease relative to such transaction shall not be greater than the fair market rental value (as determined by the Borrower or such Subsidiary in its reasonable judgment) for the assets subject to such lease, and (iv) 100% of the consideration for such Disposition shall be cash; and
(c) such Disposition is made in connection with the Disposition of any assets of the Borrower or its Subsidiaries other than those of the type described in clauses (a) and (b) above and (i) such sale or disposition of such assets is for an amount not less than the fair market value thereof; as determined by the Borrower or such Subsidiary in its reasonable judgment, (ii) no Event of Default shall have occurred and be continuing either immediately prior to such disposition or after giving effect thereto and (iii) (A) prior to or simultaneously with such disposition, the Borrower shall have provided, or caused one or more of its Subsidiaries to provide, Collateral (or substitute Collateral) of reasonably equal or greater (but if such vessel is greater, then such excess shall carry-over to any future substitution and be credited against such future substitution) value to that of the property subject to such disposition, such Collateral (or substitute Collateral) is otherwise reasonably acceptable to the Administrative Agent, and such Collateral (or substitute Collateral) and the Administrative Agents substitute Lien thereon are subject to documentation reasonably satisfactory to the Administrative Agent
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(provided that such documentation shall be satisfactory if substantially similar to the applicable Collateral Documents executed on the Closing Date), including, without limitation, any consents required under the Bonding Agreement or Intercreditor Agreement, or (B) at least seventy-five percent (75%) of the consideration therefor shall be in cash and the Net Cash Proceeds therefrom shall be payable to the Borrower or its Subsidiaries at the time of the consummation of such Disposition, the Borrower shall have concurrently with the consummation of such Disposition prepaid the Tranche B Term Loans (or permanently reduced the Revolving Credit Commitments) in an amount equal to such cash (except that the Borrower shall not be required to make any such prepayment to the extent that such Net Cash Proceeds do not exceed $100,000 in any Fiscal Year), and the aggregate of all non-cash proceeds received by the Borrower and its Subsidiaries after the Closing Date in consideration for all dispositions pursuant to this clause (c) does not exceed $7,500,000 plus the amount of cash subsequently received in respect of such non-cash proceeds that are applied to the Tranche B Term Loans as a prepayment (or permanently reduce the Revolving Credit Commitments).
Person means and includes any person, employee, individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, limited liability company, corporation, institution, entity, party, Governmental Authority or a government or any political subdivision or agency thereof.
Plan means (i) an employee benefit plan defined in Section 3(3) of ERISA in respect of which the Borrower is, or within the immediately preceding six (6) years was, an employer as defined in Section 3(5) of ERISA or (ii) a defined benefit plan as defined in Section 3(35) of ERISA (other than a Multiemployer Plan) in respect of which the Borrower or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an employer as defined in Section 3(5) of ERISA.
Prepayment Option Notice has the meaning specified in Section 2.8.2(b) .
Pricing Period means the period commencing on the forty-fifth (45th) day after the end of a Fiscal Quarter (or in the case of the last Fiscal Quarter of the Fiscal Year, commencing on the ninetieth (90th) day after the end of such Fiscal Quarter) and ending on the forty-fourth (44th) day after the end of the succeeding Fiscal Quarter (unless such succeeding Fiscal Quarter is the last Fiscal Quarter of the Fiscal Year, in which case such period shall end on the eighty-ninth (89th) date after the end of such Fiscal Quarter).
Primary Obligor has the meaning specified in the definition of Guaranties .
Principals means the collective reference to MDP, Affiliates of MDP that are stockholders of Holdings as of the Closing Date, and MDP and their respective Control Investment Affiliates.
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Proceeds Agent has the meaning specified in the Intercreditor Agreement.
Proceeds Agent Agreement has the meaning specified in the Intercreditor Agreement.
Property means any right or interest in or to property of any kind whatsoever, whether real, personal or mixed, plant, building, facility, structure, vessel, underground storage tank, equipment or unit, whether tangible or intangible, or other asset owned, leased or operated by the Borrower or any of its Subsidiaries.
Proposed Change has the meaning specified in Section 9.1.
Rate Protection Agreement means any interest rate hedging transaction, commodity hedging transaction, foreign currency hedging transaction or similar arrangement entered into pursuant to an agreement in form and substance (including amounts subject to such agreement) reasonably satisfactory to the Administrative Agent.
Receivables Security Agreements means the Lender Receivables Security Agreement referred to in and as defined in the Intercreditor Agreement.
Recovery Event means any settlement of or payment in respect of any property or casualty insurance claim, any condemnation proceeding or requisition of assets relating to any asset of Holdings, the Borrower or any of its Subsidiaries, but excluding any settlement of payment in respect of any property or casualty insurance claim, any condemnation proceeding or requisition of assets relating to any property that is the subject of Liens permitted under Section 6.2(h) (other than the Liens securing the Obligations and the Liens of the Bonding Company securing the obligations under the Bonding Agreement) securing Indebtedness permitted under Section 6.2(i).
Refinancing means the repayment in full of the Borrowers obligations under and with respect to the Existing Credit Agreement, Existing Notes and the NASDI Note, and the termination of all credit facilities or commitments, if any, with respect thereto and, if applicable, related liens and other security granted in connection therewith (except for the continuation of UCC financing statements for the benefit of the Administrative Agent and the Lenders and except as otherwise provided in Section 3.11 ).
Register has the meaning specified in Section 9.7 .
Reimbursement Obligation has the meaning specified in Section 3.5 .
Reinvestment Deferred Amount means, with respect to any Reinvestment Event, the aggregate Net Cash Proceeds received by Holdings, the Borrower or any of its Subsidiaries in connection therewith that are not applied to prepay the Tranche B Term Loans or reduce the Revolving Commitments pursuant to Section 2.8.1(c) as a result of the delivery of a Reinvestment Notice.
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Reinvestment Event means any Disposition or Recovery Event in respect of which the Borrower has delivered a Reinvestment Notice.
Reinvestment Notice means, a written notice executed by the chief financial officer or treasurer of the Borrower stating that no Default or Event of Default has occurred and is continuing and that the Borrower (directly or indirectly through a Subsidiary) intends and expects to use all or a specified portion of the Net Cash Proceeds of a Disposition or Recovery Event to acquire, improve, construct, repair assets used or useful in the business of the Borrower and its Subsidiaries.
Reinvestment Prepayment Amount means, with respect to any Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any amount expended prior to the relevant Reinvestment Prepayment Date to acquire assets used or useful in the business of the Borrower or any of its Subsidiaries.
Reinvestment Prepayment Date means, with respect to any Reinvestment Event, the earlier of (a) the date occurring 270 days after such Reinvestment Event and (b) the date on which the Borrower shall have determined not to, or shall have otherwise ceased to, acquire assets useful in the Borrowers business with all or any portion of the relevant Reinvestment Deferred Amount.
Related Documents means the Note Indenture, the Acquisition Agreement and the Bonding Agreement and the lease agreement in respect of the Equipment Financing Debt.
Related Fund means, with respect to any Lender, any fund that (x) invests in commercial loans and (y) is managed or advised by the same investment advisor as such Lender, by such Lender or an Affiliate of such Lender.
Release means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor environment.
Rentals means and includes as of the date of any determination thereof all fixed rents (including as such all payments which the lessee is obligated to make to the lessor on termination of the lease or surrender of the property and including all payments on Capital Leases) payable by the Borrower or a Subsidiary, as lessee or sublessee under a lease of real or personal property, but shall be exclusive of any amounts required to be paid by the Borrower or a Subsidiary (whether designated as rents or additional rents) on account of maintenance, repairs, insurance, taxes and similar charges. Fixed rents under any so-called percentage leases shall be computed not only on the basis of the minimum rents, if any, required to be paid by the lessee but also on the basis of any additional rents whether based on sales volume or gross revenues or otherwise. With respect to leases providing for period of free rent or discounted rent, Rentals means the amount of the actual cash payments required under the lease, even though accounting convention may require that the rents be accrued on an amortized basis over the term of the lease.
25
Reportable Event means any of the events described in Section 4043 of ERISA other than an event with respect to which the notice requirements have been waived by regulation.
Required Prepayment Lenders means the Majority Facility Lenders in respect of each Facility.
Restricted Payments means (i) any dividend or other distribution on account of any shares of any class of Capital Stock of Holdings or the Borrower or any Subsidiary of the Borrower that is not a wholly-owned Subsidiary of the Borrower (including, without limitation, any class of preferred stock) now or hereafter outstanding (except a dividend payable solely in shares or any warrants, options or other rights with respect thereto or rights to acquire shares, of common stock of Holdings or the Borrower or any Subsidiary of the Borrower), including, without limitation, all payments which are from time to time due and owing by Holdings or the Borrower pursuant to or with respect to the Acquisition Agreement (other than for indemnification or expense reimbursement pursuant to the terms thereof), (ii) any redemption, retirement, repurchase, sinking fund or similar payment, purchase or other acquisition for value of any shares of any class of Capital Stock of Holdings or the Borrower now or hereafter outstanding or any warrants, options or other rights with respect thereto, (iii) any voluntary or mandatory redemption, repurchase, retirement, sinking fund payment or other payment of principal with respect to the Note Indenture Obligations, or any voluntary payment or other prepayment of interest with respect to the Note Indenture Obligations, (iv) any payment made to redeem, purchase, repurchase or retire, or to obtain the surrender of any outstanding warrants, options or other rights to acquire shares of any class of Capital Stock of Holdings or the Borrower or any of their respective Subsidiaries, (v) any voluntary prepayment, redemption, or repurchase or other voluntary payment of principal with respect to the Bonding Agreement, or any voluntary payment or other prepayment of interest with respect thereto, or (vi) the setting aside of funds for any of the foregoing.
Revolving Commitment has the meaning specified in Section 2.1.1 .
Revolving Commitment Amount means $60,000,000, as the same may be reduced after the Closing Date pursuant to Section 2.2 .
Revolving Commitment Termination Date means the fifth anniversary of the Closing Date or the earlier date of termination in whole of all of the Revolving Commitments pursuant to Section 2.2 or 7.2 .
Revolving Credit Facility has the meaning specified in the definition of Facility.
Revolving Credit Percentage means, relative to any Revolving Lender, its percentage of the Revolving Commitment Amount as set forth on Schedule 1 to the Lender Addendum of such Lender, or if such Revolving Lender has entered into an Assignment and Acceptance, the percentage set forth for such Revolving Lender in the Register maintained pursuant to Section 9.7(d) (or, at any time after the Revolving
26
Commitments shall have expired or terminated, the percentage which the aggregate amount of such Lenders Revolving Extensions of Credit then outstanding constitutes the amount of the Total Revolving Extensions of Credit then outstanding).
Revolving Extensions of Credit means, with respect to any Revolving Lender at any time, an amount equal to the sum of (a) the aggregate principal amount of all Revolving Loans made by such Lender then outstanding, and (b) such Lenders Revolving Credit Percentage of the Letter of Credit Obligations then outstanding.
Revolving Lender means each Lender that has a Revolving Commitment or is the holder of Revolving Loans.
Revolving Loan has the meaning specified in Section 2.1.1 .
Second Preferred Fleet Mortgages means the Lender Second Ship Mortgage referred to and as defined in the Intercreditor Agreement.
Secured Parties means, collectively, the Administrative Agent, the Issuing Lenders, the Lenders and each other Person to whom any Obligations are owing, including, without limitation, each Person entitled to indemnification pursuant to Section 9.10 .
Security has the meaning specified in Section 2(1) of the 1933 Act.
Senior Debt means Total Funded Debt consisting of (i) the outstanding principal balance of the Obligations (other than the aggregate undrawn face amount of Letters of Credit), (ii) Capitalized Rentals and (iii) and all other Total Funded Debt owing by the Borrower or any of its Subsidiaries which is secured in whole or in part by a Lien on any property of the Borrower or any of its Subsidiaries. Senior Debt shall be calculated net of cash and Cash Equivalents held by the Borrower and its Subsidiaries in the United States, other than cash and Cash Equivalents held for the purpose of the redemption, repurchase or retirement of the Existing Notes (to the extent such Existing Notes are not included in the definition of Debt).
Senior Leverage Ratio has the meaning specified in Section 6.3(c)
Solvent means when used with respect to any Person that (a) the fair value of all its assets is in excess of the total amount of its debts (including contingent liabilities) determined on a going concern basis; (b) it is able to pay its matured debts and its other debts as they mature in the ordinary course of business; (c) it does not have unreasonably small capital for the business in which it is engaged or for any business or transaction in which it is about to engage; and (d) it is not insolvent as such term is defined in Section 101(32) of the Bankruptcy Code.
SPC has the meaning specified in Section 9.7 .
Subsidiary of any Person means any corporation, partnership, limited liability company or other association or entity of which more than fifty percent (50%) of
27
the Voting Stock of such entity is at any time, directly or indirectly, owned by such Person.
Subsidiary Guarantors means each domestic Subsidiary of the Borrower and each other domestic Subsidiary of Holdings which executes and delivers a Loan Party Guaranty in connection with this Agreement.
Tax Sharing Agreement means any tax sharing agreement entered into by the Loan Parties after the Closing Date and reasonably approved by the Administrative Agent and the Arrangers.
Taxes has the meaning specified in Section 2.16(a) .
Termination Event means (i) a Reportable Event with respect to any Plan; (ii) the withdrawal of the Borrower or any ERISA Affiliate from a Plan during a plan year in which the Borrower or such ERISA Affiliate was a substantial employer as defined in Section 400l(a)(2) of ERISA; (iii) the imposition of an obligation on the Borrower or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties written 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; (v) any event or condition which might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; or (vi) the partial or complete withdrawal of the Borrower or any ERISA Affiliate from a Multiemployer Plan.
Total Funded Debt of any Person means as of any date of determination, all Debt of the Borrower and its consolidated Subsidiaries which, in accordance with GAAP, should be included as liabilities in the consolidated balance sheet of the Borrower and its Subsidiaries at such time (excluding, however, the undrawn face amount of all Letter of Credit and all Capitalized Rentals due within one year from the date of determination hereunder). Total Funded Debt, when used with respect to the Borrower, shall mean the aggregate amount of all such Total Funded Debt of the Borrower and its Subsidiaries determined on a consolidated basis in accordance with GAAP (eliminating intercompany items). Total Funded Debt shall be calculated net of cash and Cash Equivalents held by the Borrower and its Subsidiaries in the United States, other than cash and Cash Equivalents held for the purpose of the redemption, repurchase or retirement of the Existing Notes (to the extent such Existing Notes are not included in the definition of Debt).
Total Leverage Ratio has the meaning specified in Section 6.3(b) .
Total Revolving Extensions of Credit means at any time the aggregate amount of Revolving Extensions of Credit of the Revolving Lenders at such time.
Tranche B Term Commitment has the meaning specified in Section 2.1.2 .
28
Tranche B Term Loan Facility has the meaning specified in the definition of Facility.
Tranche B Term Loan Maturity Date means the seventh anniversary of the Closing Date.
Tranche B Term Loans has the meaning specified in Section 2.1.2 .
Tranche B Term Loan Lenders means each Lender that has a Tranche B Term Commitment or is the holder of a Tranche B Term Loan.
Transaction Documents means the Loan Documents and all material agreements, instruments and documents executed and delivered by the Borrower which govern or effect the consummation of the Acquisition, the Initial Capital Contribution, the Notes Issuance and related transactions contemplated therein, including, without limitation, the Acquisition Agreement and the Note Indenture.
Transactions means, collectively, the Acquisition, the Notes Issuance, the Initial Capital Contribution, the Refinancing, the execution and delivery of the Loan Documents, the making of the initial Loans, the issuance of the initial Letters of Credit if any on the Closing Date, the granting of Liens to the Administrative Agent pursuant to the terms of the Loan Documents, and the application of all proceeds of any of the foregoing.
Travelers means, collectively, Travelers Casualty and Surety Company and Travelers Casualty and Surety Company of America, together with their successors and assigns.
Travelers Agreement means, collectively, the Bonding Agreement and Underwriting Documents referred to and as respectively defined in the Intercreditor Agreement.
type has the meaning specified in Section 2.3 .
Voting Stock means Securities or other equity interests of any class or classes of a corporation, partnership, limited liability company or other association or entity the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the board of directors, managers, general partners, managing members or Persons performing similar functions.
Withholding Forms has the meaning specified in Section 2.16 .
* * * * *
29
EXISTING LETTERS OF CREDIT
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LIST OF CLOSING DOCUMENTS
[TO COME]
TABLE OF CONTENTS
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Schedule 5.1(i) |
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Litigation |
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Schedule 5.1(k) |
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Schedule 5.1(r)(ii) |
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iv
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Form of Notice of Borrowing |
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Form of Notice of Conversion/Continuation |
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Form of Letter of Credit Request |
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Form of Closing Certificate |
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Form of Opinion of Kirkland & Ellis LLP |
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Form of Opinion of General Counsel to the Borrower |
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Form of Compliance Certificate |
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Form of Prepayment Option Notice |
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Exhibit I |
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Form of Lender Addendum |
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Exhibit J |
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Form of Intercreditor Agreement |
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v
Exhibit 10.2
CREDIT AGREEMENT
Dated as of December 17, 2003
Between
GENERAL ELECTRIC CAPITAL CORPORATION
And
GREAT LAKES DREDGE & DOCK COMPANY
TABLE OF CONTENTS
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ARTICLE 2 CREDIT FACILITIES; DRAWDOWN PROCEDURES AND REPAYMENT PROVISIONS |
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Service of Process and Consent to Jurisdiction; Waiver of Venue. |
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EXHIBIT B |
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Form of Secured Promissory Note |
EXHIBIT C |
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Form of First Preferred Fleet Mortgage |
EXHIBIT D |
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Form of Assignment of Earnings and Charterparties |
EXHIBIT E |
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Schedule 5.2(l) |
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Insurance |
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APPENDIX A |
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Form of Notice of Drawing |
ii
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this Agreement ), dated as of December 17, 2003, is made by and between GENERAL ELECTRIC CAPITAL CORPORATION, a corporation duly organized and validly existing under the laws of the State of Delaware, and GREAT LAKES DREDGE & DOCK COMPANY, a corporation duly organized and validly existing under the laws of the State of New Jersey.
RECITALS
WHEREAS, the Borrower has requested that the Lender make available to the Borrower a term loan in the principal amount of $23,400,000, the proceeds of which will be used by the Borrower to finance and/or refinance a portion of its cost to acquire the Vessels from BCC Equipment Leasing Corporation, a Delaware corporation ( Seller ), to pay certain costs incident hereto and thereto and to provide additional working capital; and
WHEREAS, as security for the Loan, the Borrower has offered to grant the Lender, among other things, a first preferred fleet mortgage over the Vessels, and collaterally assign to the Lender (i) all insurances and requisition compensation of the Vessels and (ii) all charters (other than charters entered into in connection with work being performed on a bonded project) entered into with respect to the Vessels having a duration of nine months or more and the right to receive payments of all sums from time to time payable thereunder; and
WHEREAS, the Lender is willing to make the Loan to the Borrower, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties do hereby agree as follows:
Section 1.1 . Certain Defined Terms . As used in this Agreement, unless the context requires otherwise, the following terms shall have the following meanings (such to be equally applicable to the singular and plural forms of the terms defined):
Acquisition Agreement means the Merger Agreement dated November 12, 2003 between GLDD Acquisition Corp., GLDD Merger Sub, Inc., and Great Lakes Dredge & Dock Corporation.
Adjusted Consolidated EBITDA means EBITDA plus adjustments, without duplication (i) required or permitted by Regulation S-X of the 1933 Act, and (ii) for the four Fiscal Quarters ending September 30, 2003, December 31, 2003, March 31, 2004, June 30, 2004, and September 30, 2004 consisting of up to $3,200,000 of adjustments with respect to the pro forma savings
resulting from the equipment financing transactions, subject to confirmation by the Lender that the Guarantors calculation of such savings is reasonable.
Affiliate means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person (excluding any trustee under, or any committee with responsibility for administering any Plan). For purposes of this definition, the term control (including the terms controlling, controlled by and under common control with) of a Person means the possession, direct or indirect, of the power to vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.
Agreement has the meaning set forth in the Preamble.
Applicable Percentage means for the FLORIDA 72.29%; for the KEY WEST 23.53%; and for the GL 184 4.18%.
Assignment of Earnings means the Assignment of Earnings and Charterparties, substantially in the form attached hereto as Exhibit D , as the same may be amended, restated, supplemented or otherwise modified from time to time.
Assignment of Insurances means the Assignment of Insurances, substantially in the form attached hereto as Exhibit E as the same may be amended, restated, supplemented or otherwise modified from time to time.
Bonding Agreement means the Second Amended and Restated Underwriting and Continuing Indemnity Agreement dated as of August 19, 1998 by and among the Guarantor, certain of its Subsidiaries and Travelers Casualty and Surety Company and Travelers Casualty and Surety Company of America, including any related notes, guaranties, collateral documents, instruments and agreements executed in connection therewith, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.
Borrower means Great Lakes Dredge & Dock Company, a New Jersey corporation, and its successors and permitted assigns.
Breakage Fees has the meaning set forth in Section 2.3(c) .
Business Day means (i) for all purposes other than as covered by clause (ii) below, any day of the year excluding Saturday, Sunday and any day which shall be in the cities of New York, New York and Chicago, Illinois a legal holiday or a day on which banking institutions are authorized or required by law or other government actions to close, and (ii) with respect to all notices and determinations in connection with any payments of principal, interest and any other amounts due hereunder or under the other Loan Documents, any day which is a Business Day described in clause (i) and which is also a day on which dealings in Dollars are carried out in the London interbank Eurodollar market.
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Capital Expenditures means, for any period, the aggregate amount of all expenditures of the Guarantor and its Subsidiaries for fixed or capital assets made or incurred during such period (whether or not paid in cash and including that portion of Capital Leases which is capitalized on the consolidated balance sheet of the Guarantor and its Subsidiaries) which, in accordance with GAAP, would be classified as capital expenditures; provided , however , that, for any such period, such aggregate amount shall be reduced by the sum of (in each case to the extent the following would otherwise be required to be capitalized on the consolidated balance sheet of the Guarantor and its subsidiaries) (a) proceeds received from the sale of fixed or capital assets which have been applied, within one year of receipt thereof, to the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful in the business of the Guarantor and its Subsidiaries; (b) insurance or requisition proceeds or condemnation awards received in connection with the damage, destruction, requisition or condemnation of fixed or capital assets which have been applied, within one year of receipt thereof, to the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful in the business of the Guarantor and its Subsidiaries; (c) proceeds of indemnity claims made by the Guarantor (or the parent corporation that owns the Guarantor) pursuant to the Acquisition Agreement to the extent used in connection with the purchase or cost of design, installation, construction, repair or improvement of fixed or capital assets used or useful in the business of the Guarantor and its Subsidiaries in connection with such indemnity claim; (d) with regard to equipment purchased simultaneously with the trade-in of existing equipment of the Guarantor or its Subsidiaries, the amount of the credit extended for such trade-in; (e) expenditures for vessels identified to be sold by the Guarantor or any of its Subsidiaries and then leased-back (on an operating lease basis) by the Guarantor or any of its Subsidiaries to the extent that such sale occurs within 180 days of the completion of the construction of such vessel and the Borrower has notified the Lender in writing in reasonable detail of the timing, facts and circumstances of such sale and lease-back to the extent that the aggregate amount of such expenditures does not exceed $15,000,000 at any time (provided that if any vessel so identified is not sold, the amount of the expenditures made that relate to such vessel shall be added back to the amount of Capital Expenditures for the Fiscal Year in which such expenditure was made); and (f) the repurchase of any Designated Vessels that are utilized by the Guarantor or any Subsidiary under an operating lease.
Capital Lease means, with respect to any Person, any lease of any property by that Person as lessee, the obligation for Rentals with respect to which is required to be accounted for as a capital lease on the balance sheet of such Person in accordance with GAAP.
Capitalized Rentals means, as of the date of any determination, the amount at which the aggregate Rentals due and to become due under all Capital Leases under which the Guarantor or any of its Subsidiaries is a lessee would be reflected as a liability on a consolidated balance sheet of the Guarantor and its Subsidiaries.
Capital Stock means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing.
CERCLA has the meaning specified in the definition of Environmental Laws.
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Change of Control means (i) the failure of one or more Principals to have or to exercise the power to elect at least a majority of the Board of Directors of the Guarantor, or (ii) the failure of the Guarantor to own (directly or indirectly) 100% of the then outstanding shares of Capital Stock of the Borrower, or to have the power (directly or indirectly) to direct or cause the direction of the management or policies of the Borrower.
Charter means any time charter, space charter, voyage charter or contract of affreightment entered into by the Borrower, as owner, with any third party charterer, for any Vessel.
Closing Date means December 17, 2003.
Code means the Internal Revenue Code of 1986, as amended.
Collateral means collectively the Vessels and all other collateral now or hereafter serving as security for any or all of the Obligations pursuant to the Loan Documents.
Collection Account has the meaning set forth in Section 5.2(h) .
Debt means and includes, with respect to any Person, (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds (including, without limitation, license, bid, performance, lien or payment bonds), debentures, notes or other similar instruments, (iii) obligations which have been incurred in connection with the acquisition of property or services (including, without limitation, obligations to pay the deferred purchase price of property or services), excluding trade payables and accrued expenses incurred in the ordinary course of business, (iv) obligations secured by any Lien or other charge upon property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such obligations, (v) obligations created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person, notwithstanding the fact that the rights and remedies of the seller, lender or lessor under such agreement in the event of default are limited to repossession or sale of property, (vi) the principal amount of Capitalized Rentals under any Capitalized Lease, (vii) all obligations of such Person to redeem, repurchase, exchange, defease in cash or otherwise make payments in cash in respect of its capital stock prior to December 17, 2013, (viii) reimbursement obligations with respect to letters of credit, and (ix) obligations under direct or indirect guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations of others of the kinds referred to in clauses (i) through (viii) above. For avoidance of doubt, notwithstanding FAS 150, the Capital Stock of the Guarantor or any direct parent of the Guarantor shall not constitute Debt so long as such Capital Stock does not require any cash payments or dividends thereon or require any mandatory redemption or repurchase prior to the date one year after the maturity of the Obligations.
Default means any Event of Default or any event which with the giving of notice or lapse of time, or both, would constitute an Event of Default.
Default Rate has the meaning set forth in Section 2.2(b) .
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Designated Vessels means the dredge New York, the dredge Victoria Island, the BTS-401 and BTS-402 Scows, the Bottom-Dump Barges G.L.61, G.L. 62 and G.L. 65, the dredge Texas and the dredge Pontchartrain and ancillary equipment related thereto.
Dollars and $ means the lawful money of the United States of America.
EBITDA means, with respect to any period, as determined in accordance with GAAP, the sum of the amounts for such period of (a) Net Income, plus , without duplication and to the extent reflected as a charge in the consolidated statement of such Net Income for such period: (i) depreciation, depletion and amortization expense, (ii) federal, state, local and foreign income taxes, (iii) Interest Expense, (iv) transaction fees and expenses incurred in connection with the Transactions to the extent not exceeding in the aggregate $17,000,000, (v) non-cash charges and losses, (vi) any amounts included in the calculation of the Net Income for amortization or non-cash charges for the write-off or impairment of goodwill, intangibles or other purchase accounting adjustments related to the accounting for this transaction, the transactions contemplated by the Senior Credit Facility or other acquisitions under GAAP (including Financial Accounting Standards No. 141 and 142), (vii) fees and expenses incurred in connection with the Bonding Agreement and this Agreement and any future amendments thereto, (viii) management fees paid pursuant to any management agreement to the extent permitted to be paid under the Senior Credit Facility, and (ix) Net Income attributable to the minority equity interests in North American Site Developers, Inc. to the extent the Net Income in respect of such minority equity interest is received by the Guarantor, and (b) minus , without duplication, (i) non-cash gains. EBITDA for the Guarantor and its Subsidiaries for the fiscal quarters ended December 31, 2002 through and including December 31, 2003 will be calculated on a pro-forma basis, adding to EBITDA, all scheduled basic hire payments previously paid by the Borrower to BCC Equipment Leasing Corporation for the Vessels and the vessel named Carolina during the twelve-month period prior to the date of calculation.
Environmental Law means all international, foreign, federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative or judicial orders, licenses, authorizations and permits of, and agreements with, any Governmental Authorities, in each case relating to environmental, health, safety and land use and natural resource matters now or hereafter in effect; including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ( CERCLA ), the Clean Air Act, the Federal Water Pollution Control Act of 1972, the Solid Waste Disposal Act, as amended, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, and the Emergency Planning and Community Right-to-Know Act, and the Occupational Safety and Health Act, and any analogous state or local laws.
ERISA means the Employee Retirement Income Security Act of 1974, as amended.
ERISA Affiliate means any (i) corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as the Borrower, (ii) partnership or other trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the Code) with the Borrower, and (iii) member of the same affiliated service group (within the meaning of Section 414(m) of the Code) as the Borrower, any corporation described in clause (i) above or any partnership or trade or business
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described in clause (ii) above.
Eurocurrency Liabilities has the meaning specified in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.
Eurodollar Rate Reserve Percentage means, for any Interest Period, the reserve percentage (expressed as a decimal and rounded upwards, if necessary, to the next higher 1/100 th of 1%) applicable two (2) Business Days before the first day of such Interest Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve System in New York City with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the interest rate on the Loan is determined) having a term equal to such Interest Period.
Event of Default means any one of the events listed in Section 6.1 .
Excluded Taxes has the meaning set forth in Section 2.4(d) .
Fiscal Quarter means any quarter of any Fiscal Year.
Fiscal Year means the fiscal year of the Guarantor consisting of a period of twelve consecutive months ending December 31.
Fleet Mortgage means the First Preferred Fleet Mortgage, substantially in the form attached hereto as Exhibit C , executed by the Borrower in favor of the Lender, as amended, restated, supplemented or otherwise modified from time to time.
GAAP means generally accepted accounting principles set forth in the rules, regulations, statements, opinions and pronouncements of the American Institute of Certified Public Accountants and of the Financial Accounting Standards Board (or agencies with similar functions of comparable stature and authority within the accounting profession) as in effect from time to time, except as provided in the definitions of Debt and Interest Expense in respect of the treatment of Capital Stock of the Guarantor (or any direct parent of the Guarantor) pursuant to Statement of Financial Accounting Standards No. 150 (FAS 150).
GE Charters has the meaning set forth in Section 5.2(q) .
Governmental Authority means any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.
Guarantor means Great Lakes Dredge & Dock Corporation, a Delaware corporation, and its successors and permitted assigns.
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Guaranty means the Guaranty Agreement dated as of the date hereof, executed by the Guarantor in favor of the Lender, as the same may be amended, restated, supplemented or otherwise modified from time to time.
Hazardous Materials means all those substances, materials or wastes, which are regulated by, or which may form the basis of liability under, any Environmental Law, including all substances, materials or wastes identified under any Environmental Law as a hazardous waste, hazardous constituent, special waste, hazardous substance, hazardous material, or toxic substance, pollutant, contaminant or words of similar meaning, asbestos, or petroleum, including crude oil or any fraction thereof, and all substances identified under CERCLA and/or OPA as hazardous.
Indenture means that certain Indenture dated as of August 19, 1998 between The Bank of New York, as trustee, the Guarantor and certain subsidiaries of the Guarantor, pursuant to which the Guarantor has consummated the issuance of its 11.25% Senior Subordinated Notes due 2008, as the same may be amended, restated, supplemented or otherwise modified from time to time.
Initial Appraisal Report means that certain Appraisal Report dated July 7, 2003 issued by Merrill Marine Services, Inc., covering the Vessels.
Interest Expense means, for any Fiscal Quarter, the aggregate consolidated interest expense (net of interest income) of the Guarantor and its consolidated Subsidiaries for such Fiscal Quarter, as determined in accordance with GAAP, including (i) commitment fees paid or payable during such Fiscal Quarter, (ii) all other fees paid or payable with respect to the issuance or maintenance of any guaranty or contingent Debt (including letters of credit but excluding fees paid under the Bonding Agreement), which, in accordance with GAAP, would be included as interest expense, (iii) net costs or benefits under any interest rate hedging transaction and (iv) the portion of any payments made in respect of Capitalized Rentals of the Guarantor and its consolidated Subsidiaries allocable to interest expense, but excluding any amortization of costs and expenses incurred in connection with, and relating to, this Agreement or other financings permitted by this Agreement. For the avoidance of doubt, Interest Expense shall not include any non-cash dividends or other non-cash payments in respect of any Capital Stock of the Guarantor or any direct parent of the Guarantor.
Interest Period means the period commencing either on the (i) Closing Date, or (ii) expiration of the immediately preceding period relating thereto, and ending three (3) months thereafter.
Lender means General Electric Capital Corporation, a corporation organized and existing under the laws of the State of Delaware (and includes its successors and assigns).
LIBOR Rate means, for any Interest Period for any LIBOR Rate Loan, the rate of interest equal to (i) the rate determined by the Lender at which Dollar deposits for such Interest Period are offered based on information presented on Page 3750 of the Dow Jones Market Service (formerly known as the Telerate Service) as of 11:00 a.m. London time on the second Business Day prior to the first day of such Interest Period, divided by (ii) a number equal to 1.00
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minus the Eurodollar Rate Reserve Percentage for such Interest Period. If the rate described above does not appear on the Dow Jones Market Service on any applicable interest determination date, the LIBOR Rate shall be the rate (rounded upwards, if necessary, to the next higher 1/100 th of 1%) appearing on Reuters Screen FRBD as of 11:00 a.m. (London time) two (2) Business Days prior to the first day of such Interest Period and having a maturity equal to such Interest Period, as adjusted for reserves, and if that rate does not appear on Reuters Screen FRBD on any applicable interest determination date, the LIBOR Rate shall be the rate (rounded upwards, if necessary, to the next higher 1/100 th of 1%), determined on the basis of the offered rates for deposits in U.S. Dollars for a period of time comparable to such LIBOR Rate Loan which are offered by four major banks in the London interbank market at approximately 11:00 a.m. London time, on the second Business Day prior to the first day of such Interest Period as selected by the Lender. The principal London office of each of the four major London banks will be requested to provide a quotation of its U.S. Dollar deposit offered rate. If at least two such quotations are provided, the rate for that date will be the arithmetic mean of quotations. If fewer than two quotations are provided as requested, the rate for that date will be determined on the basis of the rates quoted for loans in U.S. Dollars to leading European banks for a period of time comparable to such Interest Period offered by major banks in New York City at approximately 11:00 a.m. (New York time), on the second Business Day prior to the first day of such Interest Period. In the event that the Lender is unable to obtain any such quotation as provided above, it will be considered that LIBOR Rate cannot be determined.
LIBOR Rate Loan means the Loan while bearing interest at the LIBOR Rate.
Lien means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset. For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset.
Loan has the meaning set forth in Section 2.1(a) .
Loan Documents mean this Agreement, the Note, the Fleet Mortgage, the Assignment of Insurances, the Assignment of Earnings, the Guaranty, and any other agreements, documents and instruments executed and/or delivered pursuant to this Agreement or otherwise evidencing, securing and/or guaranteeing the Loan or other Obligations.
Material Adverse Effect means (a) a material adverse effect upon (i) the financial condition, operating results, assets, liabilities, business or operations of the Guarantor and the Borrower taken as a whole, or (ii) the ability of the Borrower to perform in any material respect the Loan Documents, or (b) the occurrence of an event which could reasonably be expected to have a material adverse effect on the legality, validity or enforceability against the Borrower of this Agreement or any other Loan Document or any of its Obligations hereunder or thereunder.
Maturity Date has the meaning set forth in Section 2.1(b) .
Multiemployer Plan means a Plan which is defined in § 4001(a)(3) of ERISA.
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Net Proceeds means the cash proceeds received by the Borrower in connection with the consummation of any transaction or event of the type resulting in a mandatory prepayment under Section 2.1(e) , net of all fees, expenses, charges, taxes, commissions and costs incurred by the Borrower in connection with the consummation of such transaction or the prosecution or settlement of such event.
Net Income means, for any period, the aggregate of all amounts (exclusive of all amounts in respect of any extraordinary or non-recurring gain or loss) which, in accordance with GAAP, would be included as net income on a consolidated statement of income of the Guarantor and its Subsidiaries for such period.
Note means the secured promissory note of even date herewith, substantially in the form attached hereto as Exhibit B , in the original principal amount of $23,400,000, executed by the Borrower and payable to the order of the Lender to evidence the Loan, as the same may be amended, restated, supplemented, or otherwise modified from time to time.
Notice of Drawing has the meaning set forth in Section 2.1(a) .
Obligations means any obligations of the Borrower to the Lender of any kind, including, without limitation, any obligation to make any payment for any reason, whether or not such obligation is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such obligation is discharged, stayed or otherwise affected by any proceeding referred to in Section 6.1(g) or 6.1(h) , in each case arising under this Agreement or under any other Loan Document. For the purposes hereof, the Borrowers Obligations under the Loan Documents include, without limitation, the timely payment of (i) all principal, interest, prepayment premiums, late charges, fees and expenses (including reasonable attorneys fees and expenses), disbursements, indemnities and any other amounts payable by the Borrower under or pursuant to the Note or any of the other Loan Documents, and (ii) any amount which the Lender, in its sole discretion, may elect to pay or advance on the Borrowers behalf pursuant to and in accordance with the terms of the Loan Documents.
OPA means the Oil Pollution Act of 1990, as amended, together with all rules and regulations promulgated pursuant thereto.
Permitted Business Acquisition means any acquisition by the Guarantor or any of its Subsidiaries of all or any part of the assets, shares or other equity interests in a corporation or other Person engaged in the same business or activities reasonably related, complementary or incidental to the business of the Guarantor or any of its Subsidiaries but only if no Default or Event of Default shall have occurred and be continuing immediately prior to such acquisition or after giving effect thereto.
Permitted Liens means, in the case of the Vessels:
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Person means a natural person, partnership, corporation (including a business trust), limited liability company, joint stock company, partnership (whether general or limited), trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof, or any other entity, whether acting in an individual, fiduciary or other capacity.
Plan means an employee benefit plan defined in Section 3(3) of ERISA in respect of which the Borrower or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an employer as defined in Section 3(5) of ERISA.
Prepayment Premium means an amount equal to (i) 3% of any principal amount prepaid on or before December 17, 2004, (ii) 2% of any principal amount prepaid after
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December 17, 2004 and prior to December 17, 2005, (iii) 1% of any principal amount prepaid after December 17, 2005 and prior to December 17, 2008, and (iv) 0% thereafter.
Prime-Based Rate means a floating and fluctuating per annum rate of interest at all times equal to the prime rate of interest published from time to time in the Money Rates Section of The Wall Street Journal .
Principals means the collective reference to the Persons that are stockholders of the Guarantor as of the Closing Date; provided , however , that upon consummation of the Sale in accordance with the terms and conditions set forth in Section 5.3(g) , the term Principals shall thereafter mean the collective reference to the Persons that are stockholders of the newly created entity that owns (directly or indirectly) 100% of the outstanding shares of Capital Stock of the Guarantor as of the closing date of the Sale.
Rentals means, with respect to any Person, as of the date of any determination thereof all fixed rents (including as such all payments which the lessee is obligated to make to the lessor on termination of the lease or surrender of the property and including all payments on Capital Leases) payable by such Person, as lessee or sublessee under a lease of real or personal property, but shall be exclusive of any amounts required to be paid by such Person (whether designated as rents or additional rents) on account of maintenance, repairs, insurance, taxes and similar charges.
Sale has the meaning set forth in Section 5.3(g) .
Seller has the meaning set forth in the Recitals to this Agreement.
Senior Credit Facility means the Credit Agreement, dated as of August 19, 1998, among the Guarantor, certain subsidiaries of the Guarantor (including, without limitation, the Borrower), the financial institutions from time to time party thereto, and Bank of America, N.A., as administrative agent, as the same may be amended, restated, supplemented or otherwise modified from time to time and any credit agreement or other agreement or agreements relating to any refinancing, extension, renewal or replacement, in whole or in part from time to time, thereof.
Senior Debt means Total Funded Debt consisting of (i) the aggregate principal amount of all Debt of such Person as shown on such Persons balance sheet, other than Subordinated Debt, and (ii) Capitalized Rentals, all determined on a consolidated basis in accordance with GAAP. Senior Debt shall be calculated net of cash and cash equivalents held by the Guarantor and its Subsidiaries in the United States.
Senior Lenders means the lenders from time to time under the Senior Credit Facility.
Subordinated Debt means any Debt of the Guarantor, the Borrower or any Subsidiary subordinated in right and time of payment to the Obligations on terms and pursuant to documentation reasonably satisfactory to the Lender in all respects. The subordination provisions set forth in the Indenture are acknowledged by the Lender to be satisfactory to the Lender.
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Subsidiary of any Person means any corporation of which more than 50% of the issued and outstanding capital stock having ordinary voting power to elect a majority of the Board of Directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Persons other Subsidiaries.
Total Funded Debt of any Person means, as of any date of determination, all Debt of the Guarantor and its consolidated Subsidiaries which, in accordance with GAAP, should be included as liabilities in the consolidated balance sheet of the Guarantor and its Subsidiaries at such time (excluding, however, the undrawn face amount of all letters of credit and all Capitalized Rentals due within one year from the date of determination hereunder). Total Funded Debt, when used with respect to the Guarantor, shall mean the aggregate amount of all such Total Funded Debt of the Guarantor and its Subsidiaries determined on a consolidated basis in accordance with GAAP (eliminating intercompany items). Total Funded Debt shall be calculated net of cash and cash equivalents held by the Guarantor and its Subsidiaries in the United States.
Total Loss has the meaning set forth in Section 5.2(l) .
Transactions means, collectively, the merger and the other transactions contemplated by the Acquisition Agreement.
UCC means the Uniform Commercial Code as in effect from time to time in the State of New York.
U.S. Person has the meaning specified in Code Section 7701(a)(30).
Vessels means collectively the Vessels identified on Exhibit A attached hereto; and Vessel means each such Vessel individually; provided , however , that any Vessel released from the security interest created under this Agreement or the other Loan Documents pursuant to the terms hereof or thereof shall, from and after such release, no longer constitute a Vessel.
Section 1.2 . Computation of Time Periods . For the purposes of this Agreement, in the computation of periods of time from a specified date to a later specified date, the word from means from and including and each of the words to and until means to but excluding.
Section 1.3 . Accounting Terms . All accounting terms not specifically defined herein shall be construed in accordance with GAAP. Except as otherwise provided herein, if any changes in accounting principles from those used in the preparation of the most recent financial statements referred to in Section 5.2(a ) are hereafter required or permitted by the rules, regulations, pronouncements and opinions of the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (or successors thereto or agencies with similar functions) and are adopted by the Guarantor or the Borrower with the agreement of its independent certified public accountants and such changes result in a change in the method of calculation of any of the financial covenants, standards or terms found in Section 5.2(r) or in the related definitions of terms used therein, the parties hereto agree to enter into negotiations in
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order to amend such provisions so as to reflect equitably such changes with the desired result that the criteria for evaluating the Borrowers or the Guarantors financial condition shall be the same after such changes as if such changes had not been made, provided that no change in GAAP that would affect the method of calculation of any of the financial covenants, standards or terms shall be given effect in such calculations until such provisions are amended, in a manner reasonably satisfactory to the Lender, so as to reflect such change in accounting principles. Notwithstanding anything to the contrary herein, the application of GAAP shall not include FAS 150.
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then the Lender shall promptly notify the Borrower in writing thereof and the Lender and the Borrower shall attempt to agree upon an alternative rate that would otherwise compensate the Lender for the cost of making or maintaining the Loan. In the event the parties cannot agree on an alternative rate, then, within sixty (60) days thereafter, the Borrower shall either: (a) prepay the Loan, together with all accrued interest thereon, Breakage Fees and Prepayment Premiums, if any, and all other sums due hereunder; or (b) request the Lender to convert the interest rate applicable to the Loan from a rate based on the LIBOR Rate to the Prime-Based Rate (plus 340 basis points instead of 440 basis points) effective on the last day of the current Interest Period. The Lender shall agree to modify the terms of the Note reflecting the change in the applicable interest rate so long as no Default or Event of Default has then occurred.
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If any taxes (other than Excluded Taxes) are directly assessed against the Lender, the Lender shall promptly notify the Borrower of such assessment. Unless the Borrower promptly provides evidence satisfactory to the Lender that such taxes have been paid, the Lender may pay such taxes. Thereafter, the Borrower shall pay such additional amount (including, without limitation, any penalties, interest or expenses, but excluding any such items resulting from (A) the failure of the Lender promptly to notify the Borrower of the assessment of such taxes against the Lender or (B) the gross negligence, bad faith or willful misconduct of the Lender) as may be necessary for the Lender to receive, after the payment of such taxes (including any taxes on such additional amount), the amount the Lender would have received had no such taxes been assessed. The Borrowers obligations arising from this Section 2.4(d) shall survive repayment of the Loan, cancellation of the Note and the termination of this Agreement.
Notwithstanding any provision contained in this Agreement to the contrary, in the event that the Lender should assign all or any portion of the Loan or of its rights under this Agreement to another Person, the Borrowers obligations under this Section 2.4 shall not be greater than what its obligations would have been if the Lender had retained a 100% interest in the Loan and in this Agreement.
If the Lender determines that it has received a refund or direct credit with any taxes as to which the Borrower has made additional payments, it shall promptly notify Borrower of such refund or direct credit and shall within thirty (30) days of its receipt of the amount of such refund or direct credit pay such amount to the Borrower (plus any interest paid or credited by the relevant taxing authority with respect to such amount). The Lender shall cooperate with the Borrower to obtain any refunds or direct credits that would give rise to payments hereunder
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provided (i) the Borrower pays all reasonable out of pocket expenses incurred by the Lender to obtain such refunds or direct credits and (ii) the Lender determines, in its reasonable discretion, that it would not be materially disadvantaged (other than costs and expenses that the Borrower has agreed to pay) in obtaining the refund or direct credit. To the extent a refund or direct credit is required to be repaid with respect to which the payments have been made under this provision, the Borrower shall indemnify and promptly reimburse the Lender for the amounts repaid.
Section 2.5 . Setoff . In addition to and not in limitation of any rights of the Lender under applicable law, the Lender shall, upon the occurrence and during the continuance of an Event of Default under Section 6.1(a) , have the right to appropriate and apply to the payment of the Obligations then due and unpaid, any and all monies, securities, deposits and other property of the Borrower, now or hereafter held or received by, or in transit to, the Lender. The Lender agrees promptly to notify the Borrower after any such setoff and application made by the Lender; provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of the Lender under this Section 2.5 are in addition to other interests, rights and remedies (including other rights of setoff) which the Lender may have.
Section 3.1. Security Documents . In order to secure the prompt payment and performance of its Obligations in connection with the Loan, the Borrower shall execute and deliver to the Lender the following:
In addition to the foregoing, the Borrower shall promptly deliver or cause to be delivered to the Lender the following documents and instruments: (i) a copy of the Certificate of Documentation for each Vessel; (ii) the Letter to the Master and form of Notice of Mortgage and the Borrowers certification that such Notice of Mortgage is posted on each Vessel; (iii) certificates of insurance issued by the Borrowers insurance broker evidencing the insurances covering the Vessels; and (iv) an appropriate Uniform Commercial Code financing statement with respect to the security interests created pursuant to the Loan Documents.
Section 3.2. Release of Security . Upon the sale or other disposition of any Vessel and the payment by the Borrower to the Lender of all sums payable pursuant to Section 2.1(e) , the Lender, at the Borrowers sole cost and expense, shall release and discharge such Vessel (and any other Collateral used on or forming part of said Vessel) from the security interest created under this Agreement or any other Loan Document. Upon payment in full of all sums due hereunder and under the Note and performance of all of the Borrowers Obligations with respect thereto, the Lender, at the Borrowers sole cost and expense, shall release and discharge any and all
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security delivered pursuant to this Agreement or any of the other Loan Documents. The Lender agrees to execute and deliver to the Borrower any instrument, agreement or release document necessary to effect such release of Liens, and to take such other actions as shall be reasonably necessary to release the Liens required to be released under this Section 3.2 promptly upon the reasonable request of the Borrower and payment by the Borrower of all reasonable out of pocket costs related thereto.
Section 3.3 . Exercise of Powers of Attorney. The Lender shall not exercise any rights or powers pursuant to any power of attorney granted to the Lender pursuant to the Fleet Mortgage or the other Loan Documents except upon the occurrence and during the continuance of an Event of Default.
Section 4.1 . Conditions Precedent to Initial Funding . The Lenders agreement to enter into this Agreement and to make the Loan available to the Borrower is subject to the condition precedent that the Lender shall have received on or before the date hereof the following, each in form and substance reasonably satisfactory to the Lender:
The Lender shall also have received:
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Section 5.1 . Representations and Warranties . The Borrower hereby represents and warrants as follows:
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25
(i) marine hull insurance on full conditions as per Institute Time Clauses Hull (1/10/83) or American Institute Hull Clauses (June 2, 1977) or other conditions approved by the Lender, insuring each of the Vessels against the usual risks, and for all Vessels taken together for an agreed aggregate value of not less than 110% of the outstanding principal balance of the Loan and in all events not less, for each Vessel, than the fair market value of such Vessel as shown in the Initial Appraisal Report;
(ii) full protection and indemnity cover on terms and conditions as per the rules of a protection and indemnity club that is a member of the International Group of Protection and Indemnity Associations, or equivalent cover acceptable to the Lender, providing for liability cover in an amount at least equal to $50,000,000 for any one accident or occurrence;
(iii) to the extent not already included above, insurance against liability for pollution, spillage or leakage emanating from the Vessels in an amount at least equal to $50,000,000 for any one accident or occurrence or such other amount as the Lender may agree;
(iv) when located in areas normally considered by insurance brokers and underwriters to involve war-like or hostile areas, war risk insurance, which shall be maintained in the broadest forms generally available in the United States, London, European or Japanese markets, and shall include coverage for war risk hull and machinery, war risk protection and indemnity, confiscation, expropriation, and piracy. Such insurance shall be in a total amount for the aggregate of the Vessels of not less than
26
110% of the outstanding principal balance of the Loan and in all events not less than, for each Vessel, the fair market value of such Vessel as shown in the Initial Appraisal Report; and
(v) to the extent not already included above, mortgagees interest insurance, with a single limit at all times of not less than the outstanding principal balance of the Loan plus accrued but unpaid interest due thereon.
All such insurance shall be provided by (i) the insurers listed on Schedule 5.2(l) , (ii) insurers that have an A.M. Best policy-holders rating of not less than A, or if no such rating is applicable, having a quality comparable to those rated A or better, or (iii) such other insurers as the Lender may reasonably approve, and shall contain endorsements, in form and substance reasonably satisfactory to the Lender, naming the Lender as loss payee with respect to the casualty insurance which insures the Vessels and as an additional insured but without any liability for premiums, calls or other assessments with respect to each liability insurance policy. Notwithstanding the foregoing, unless otherwise required by the Lender by written notice to the underwriters (which notice may only be given while an Event of Default is in existence), (i) any loss under any insurance on the Vessels with respect to protection and indemnity risks shall be paid directly to the Borrower to reimburse it for any loss, damage or expense previously paid by it and covered by such insurance or to the Person to whom any liability covered by such insurance has been incurred, and (ii) in the case of any loss (other than a Total Loss) under any insurance with respect to the Vessels involving any loss or damage to the Vessels, the underwriters may, so long as they have not been notified that an Event of Default has occurred and is continuing, pay directly for the repair, replacement, salvage or other charges involved or, if the Borrower shall have first repaired the damage or paid salvage or other charges, may pay the Borrower as reimbursement therefor; provided , however , that if such damage involves a loss in excess of 10% of the value of the affected Vessel as of the Closing Date as established by the Initial Appraisal Report, the underwriters shall make such payment directly to the Lender, which amount shall be distributed by the Lender to the Borrower for application to repair or replace the Vessel, upon the Lenders receipt of evidence reasonably satisfactory to it of the completion of such repairs or replacement. The Borrower shall furnish to the Lender annually certificates of insurance evidencing the insurance maintained in respect of the Vessels. Each insurer shall agree, by endorsement upon the policy or policies issued by it, or by independent instrument furnished to the Lender, that (i) it will give the Lender thirty (30) days prior written notice of the effective date of any material alteration, cancellation or non-renewal of such policy or policies; and (ii) the insurance as to the interest of any named loss payee other than the Borrower shall not be invalidated by any actions, inactions, breach of warranty or condition or negligence of the Borrower with respect to such policy or policies.
Upon the occurrence of: (i) the actual or constructive total loss or compromised, agreed or arranged total loss of any of the Vessels; or (ii) the loss, theft or destruction of any of the Vessels or damage thereto to such extent as shall make repair thereof uneconomical or shall render any of the Vessels permanently unfit for normal use for any reason whatsoever; or (iii) the requisition of title to or other compulsory acquisition of any of the Vessels (otherwise than by requisition for hire); or (iv) the capture, seizure, arrest or detention of any of the Vessels by any government or by persons acting or purporting to act on behalf of any government (as established to the reasonable satisfaction of the Lender); unless the Vessel(s) shall be released
27
from such capture, seizure, arrest or detention within sixty (60) days after such occurrence but in all events prior to the maturity of the Loan (any such occurrence being herein referred to as a Total Loss ) of any of the Vessels; or (ii) upon the occurrence and during the continuance of an Event of Default, the Lender may, by delivery of written notice to the Borrower, elect to apply all insurance proceeds received by it toward prepayment of the Loan in accordance with Section 2.1(e) .
The Borrower shall be responsible for pursuing all claims under the insurances indicated above, and take such actions as may be reasonably necessary to satisfy all insurers inquiries. The Borrower agrees that the Vessels shall be operated within the confines of the cover provided by all insurances. The Borrower further agrees that it will not make, do, consent or agree to any act or omission which would or could render any insurance covering the Vessels invalid, void, voidable, or unenforceable or render any sum payable thereunder repayable in whole or part. The Borrower further covenants to make no changes regarding the management of the Vessels which could invalidate or cause to be terminated any of the insurance coverages required by the provisions of Section 5.02(l) of this Agreement, in each case without either (i) the prior written consent of the Lender or (ii) the delivery to the Lender prior to such change of management an endorsement or endorsements to such policy or policies confirming that such insurances will be unaffected by such change in management.
28
29
Period |
|
Ratio |
|
|
|
January 1, 2004 through and including December 31, 2004 |
|
5.75 to 1.00 |
|
|
|
January 1, 2005 through and including December 31, 2005 |
|
5.50 to 1.00 |
|
|
|
January 1, 2006 through and including December 31, 2006 |
|
5.00 to 1.00 |
|
|
|
January 1, 2007 through and including December 31, 2007 |
|
4.75 to 1.00 |
|
|
|
January 1, 2008 through and including December 31, 2008 |
|
4.50 to 1.00 |
|
|
|
January 1, 2009 through and including December 31, 2009 |
|
4.00 to 1.00 |
|
|
|
January 1, 2010 and thereafter |
|
3.50 to 1.00 |
30
Period |
|
Ratio |
|
|
|
January 1, 2004 through and including December 31, 2004 |
|
2.50 to 1.00 |
|
|
|
January 1, 2005 through and including December 31, 2005 |
|
2.25 to 1.00 |
|
|
|
January 1, 2006 through and including December 31, 2006 |
|
2.00 to 1.00 |
|
|
|
January 1, 2007 through and including December 31, 2007 |
|
1.75 to 1.00 |
|
|
|
January 1, 2008 through and including December 31, 2008 |
|
1.50 to 1.00 |
|
|
|
January 1, 2009 and thereafter |
|
1.25 to 1.00 |
Period |
|
Ratio |
|
|
|
January 1, 2004 through and including December 31, 2004 |
|
1.75 to 1.00 |
|
|
|
January 1, 2005 through and including December 31, 2005 |
|
2.00 to 1.00 |
|
|
|
January 1, 2006 through and including December 31, 2006 |
|
2.00 to 1.00 |
|
|
|
January 1, 2007 through and including December 31, 2008 |
|
2.25 to 1.00 |
|
|
|
January 1, 2009 and thereafter |
|
2.50 to 1.00 |
31
The Borrower covenants and agrees that so long as any of the Obligations (other than contingent obligations hereunder for which no claim has been or is reasonably expected to be made) remain outstanding, the Borrower shall not:
(1) any Subsidiary of the Borrower may liquidate or dissolve voluntarily into, and may merge with and into, the Borrower, and the assets or stock of any of the Borrowers Subsidiaries may be purchased or otherwise acquired by the Borrower, as the case may be; or
(2) Permitted Business Acquisitions.
32
Section 6.1 . Events of Default, Acceleration . If any of the following events (each an Event of Default and collectively Events of Default ) shall occur and be continuing:
33
(e) (i) the Borrower or the Guarantor shall fail to pay any Debt in an aggregate principal amount in excess of $1,000,000 at its final scheduled maturity date; or
(ii) any breach, default or event of default shall occur under any instrument, agreement or indenture pertaining to any Debt referred to in clause (i) above, if the effect thereof, after giving effect to any applicable grace or cure period, is to accelerate the maturity of such Debt or cause such Debt to be declared due and payable or required to be prepaid (other than by a regularly scheduled required prepayment), repurchased or redeemed prior to the originally stated maturity thereof; or
(f) one or more final judgments for the payment of money in the aggregate in excess of $10,000,000 (to the extent not covered by insurance) entered by a court of competent jurisdiction against the Borrower or the Guarantor shall remain undischarged, unpaid, unvacated, unbonded or unstayed for a period of thirty (30) days from the date of its entry, or there shall be any period of thirty (30) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, shall not be in effect; or
(g) the Borrower or the Guarantor shall (i) apply for or consent to the appointment of or the taking possession by a receiver, trustee, liquidator, assignee, custodian, sequestrator or the like of itself or substantially all of its property, (ii) admit in writing its inability to pay its debts generally, (iii) make a general assignment for the benefit of creditors, (iv) commence a voluntary case under the bankruptcy laws of any jurisdiction, (v) file a petition or answer seeking reorganization or an arrangement with creditors or to take advantage of any insolvency law or an answer admitting the material allegations of a petition filed against it in any bankruptcy, reorganization or insolvency proceeding or (vi) take corporate action or other action for the purpose of effecting any of the foregoing; or
(h) an order, judgment, or decree shall be entered in any involuntary case with or without the application, approval or consent of the Borrower or the Guarantor, by a court or governmental agency of competent jurisdiction, granting relief under or approving a petition seeking reorganization, or appointing a receiver, trustee, liquidator assignee, custodian, sequestrator or the like of the Borrower or the Guarantor, or of its property and such order, judgment or decree shall continue unstayed and in effect for a period of sixty (60) consecutive days; or
(i) for any reason, the Lender fails to hold a perfected first preferred mortgage on the Vessels (other than in accordance with the terms hereof or thereof); or
(j) an event of default shall occur and be continuing under any of the other Loan Documents and all grace or cure periods, if any, with respect thereto shall have expired; or
(k) the Borrower ceases operations or is dissolved;
(l) any notice shall have been issued by the United States Coast Guard to the effect that any Vessel subject to the Fleet Mortgage is subject to deletion from registry or the
34
Certificate of Documentation for any such Vessel or the endorsement noted thereon is subject to revocation or cancellation, for any reason whatsoever and such notice is not appealed or challenged by appropriate legal action within thirty (30) days of the Borrowers receipt thereof or such other period of times as may be permitted by law, or any Vessel subject to the Fleet Mortgage is deleted from registry or the Certificate of Documentation for any such Vessel or the endorsement noted thereon is revoked or cancelled;
then, and in any such event (A) the Lender may declare the Loan to be in Default, (B) upon written notice to the Borrower, the Lender may declare all of the Borrowers Obligations to the Lender hereunder, together with accrued interest to the date of payment to be, and the same shall forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which the Borrower hereby waives, and (C) the Lender may exercise all other remedies available to it under any Loan Document or any applicable law; provided , however , if a default occurs under subparts (g) and (h) of this Section 6.1 , no such declaration or notice shall be necessary and subpart (A), (B), and (C) hereof shall operate as if such declaration and notice had been made.
The rights and remedies of the Lender hereunder and under any documents or instruments executed pursuant hereto are cumulative, and recourse to one or more rights or remedies shall not constitute a waiver of the others or an election of remedies. It is mutually agreed that commercial reasonableness and good faith require the giving of no more than ten (10) Business Days prior written notice of the time and place of any public sale of any Collateral or of the time after which any private sale or any other intended disposition thereof is to be made, and at any such public or private sale, subject to limitations of law, the Lender, its agents and/or nominees, may purchase the Collateral. If the net proceeds of any disposition of Collateral exceed the amount then due and owing, whether by acceleration, at maturity or otherwise, or on demand, such excess will be remitted to Borrower or whomsoever shall be legally entitled thereto. The Borrower shall remain liable for any deficiency remaining after disposition of Collateral.
If the Borrower fails to perform or comply with any of its obligations contained herein, the Lender shall have the right, but shall not be obligated, to effect such performance or compliance and the Borrower, within ten (10) Business Days from the date of demand, shall reimburse the Lender immediately for such sums so expended, together with interest thereon at the Default Rate for the actual number of days elapsed from date of payment by the Lender to the date on which the Lender receives payment thereof from the Borrower. Failure of the Borrower to pay and promptly discharge the aforesaid debts and obligations shall constitute an Event of Default under this Agreement, but the payment of the same by the Lender shall not cure or constitute a waiver of such Event of Default. Upon the occurrence and during the continuance of an Event of Default, all payments received by the Lender from or on behalf of the Borrower shall be applied by the Lender to any installment(s) due and payable under the Note as the Lender, in its sole discretion, may determine, without notice to or consent of Borrower, the Borrower hereby expressly waives (to the extent permitted by law) all rights to make or manifest any binding instruction upon the Lender as to application of such payments other than as provided herein. Acceptance by the Lender of partial payment(s) or performance by the Borrower or by any other third party shall not be construed as a waiver of any Event of Default, nor shall the same affect or in any way impair the rights and remedies of the Lender hereunder.
35
Section 6.2 . Additional Rights. The Borrower hereby irrevocably appoints the Lender as its attorney-in-fact (which power shall be deemed coupled with an interest) to, following the occurrence and during the continuance of an Event of Default execute, endorse and deliver any deed, conveyance, assignment or other instrument in writing as may be required to vest in the Lender any right, title or power which by the terms hereof are expressed to be conveyed to or conferred upon the Lender, including any documents and checks or drafts relating to or received in payment for any loss or damage under the policies of insurance required by the provisions of Section 5.2(l) hereof, but only to the extent that the same relates to the Collateral.
Section 7.1. Amendments, etc. No amendment or waiver of any provision of this Agreement nor consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be in writing and signed by the Lender and the Borrower and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
Section 7.2 . Notices, etc. All notices and other communications provided for hereunder shall be in writing and mailed, facsimile transmitted or delivered as follows:
To the Borrower: |
|
Great Lakes Dredge & Dock Company |
|
|
|
2122 York Road |
|
|
|
Oak Brook, Illinois 60521 |
|
|
|
Attn: |
Deborah A. Wensel |
|
|
|
Senior Vice President, |
|
|
|
Chief Financial Officer and Treasurer |
|
|
Fax: (630) 574-2981 |
|
|
|
|
|
|
|
|
|
with a copy to: |
|
Brian S. Hart |
|
|
|
Winston & Strawn LLP |
|
|
|
35 W. Wacker Drive |
|
|
|
Chicago, Illinois 60601 |
|
|
|
Fax: (312) 558-5700 |
36
To the Lender: |
|
General Electric Capital Corporation |
|
|
500 West Monroe Street |
|
|
Suite 2900 |
|
|
Chicago, Illinois 60661 |
|
|
Attn: Walter R. Schoultz |
|
|
Facsimile: (312) 441-7395 |
|
|
|
with a copy to: |
|
Patrick K. Cameron, Esq. |
|
|
Ober, Kaler, Grimes & Shriver |
|
|
120 E. Baltimore Street, 9 th Floor |
|
|
Baltimore, Maryland 21202 |
|
|
Fax: (410) 547-0699 |
or to such other address as shall be designated by such party in a written notice to the other party. All such notices and communications shall, when mailed be sent by first class registered mail postage prepaid and be effective three (3) calendar days after being deposited in the U.S. mails addressed as aforesaid. All notices sent by facsimile transmission shall be effective when sent. All other forms of written notice or other communication shall be effective upon receipt.
Section 7.3. Governing Law . THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS AND DECISIONS OF SAID STATE, INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAWS.
Section 7.4. Service of Process and Consent to Jurisdiction; Waiver of Venue . Each party hereto hereby irrevocably submits to the non-exclusive jurisdiction of the Federal and State courts located in the State of New York, in any action brought under this Agreement, the Note, or any other Loan Document and agrees that a summons and complaint commencing any action or proceeding in such court shall be properly served if delivered personally or by registered mail to such party at its address set forth in Section 7.2 above, or otherwise served under the laws of the State of New York, and each party hereto hereby waives any objection to venue and jurisdiction which the Borrower may now or hereafter have. Each party shall promptly notify the other party of any change in such address. Nothing herein shall affect the right of the Lender to serve process in any other matter prescribed by law or the right of the Lender to bring legal proceedings in any other competent jurisdiction.
Section 7.5 . No Remedy Exclusive . Each and every right, power and remedy given to the Lender in this Agreement, the Note, and the other Loan Documents shall be cumulative and shall be in addition to every other right, power and remedy herein or therein given now or hereafter existing at law, in equity, in admiralty, by statute or otherwise. Each and every right, power and remedy whether given therein or otherwise existing may be exercised from time to time as often and in such order as may be determined by the Lender, and neither the failure or delay in exercising any power or right nor the exercise or partial exercise of any right, power or remedy shall be construed to be a waiver of or acquiescence in any default therein; nor shall the acceptance of any security or of any payment of or on account of the Loan, obligations,
37
expenses, interest or fees maturing after a default or of any payment on account of any past default be construed to be a waiver of any right to take advantage of any future default or of any past default not completely cured thereby.
Section 7.6 . Payment of Costs . Whether or not the transactions contemplated herein shall be consummated, the Borrower hereby agrees to pay (a) all reasonable out-of-pocket costs and expenses (evidenced by invoices in reasonable detail) incurred by the Lender (including the reasonable fees and expenses of its counsel) in connection with the preparation, execution and delivery of this Agreement and any Loan Document or any amendment to any Loan Document, and (b) all losses, costs and expenses (including, but not limited to, reasonable attorneys fees and expenses) in connection with (i) the preservation of any rights of the Lender under, or legal advice in respect of, the rights or responsibilities of the Lender under this Agreement and the Loan Documents or (ii) the enforcement of any Loan Document. The Borrower agrees to indemnify and hold the Lender harmless from and against any documentary taxes, assessments or charges made by any governmental authority by reason of the execution, delivery, filing or recordation of this Agreement or any Loan Document.
Section 7.7 . Further Assurances . The Borrower further agrees to execute such other and further assurances and documents as reasonably requested by the Lender to more effectively to carry out the terms of this Agreement or of any other Loan Document.
Section 7.8 . Counterparts . This Agreement may be executed in counterparts, each of which when so executed shall be deemed an original but all such counterparts shall together constitute but one and the same instrument.
Section 7.9 . Headings . The titles of the Articles and the Section headings of this Agreement are for convenience only and shall not affect the construction of this Agreement.
Section 7.10 . Severability . If any term or provision of this Agreement or any other Loan Document shall be determined to be invalid or unenforceable for any reason, such determination shall not adversely affect any other term or provision of this Agreement or such other Loan Document which shall remain in full force and effect and the effect of such determination shall be limited to the territory or the jurisdiction in which made.
Section 7.11 . Survival . The Borrowers agreements, representations, warranties and conditions contained in this Agreement and made pursuant to the provisions hereof shall survive the execution and delivery of this Agreement until the Loan and all interest thereon shall have been repaid in full in accordance with the terms of this Agreement, and any and all other moneys, payments, obligations and liabilities which the Borrower shall have made, incurred or become liable for pursuant to the terms of this Agreement or any other Loan Document shall have been paid in full.
Section 7.12 . WAIVER OF TRIAL BY JURY . THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH THEY MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY PERTAINING TO (A) THIS AGREEMENT OR (B) THE OTHER LOAN DOCUMENTS. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY
38
OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY EACH OF THE PARTIES HERETO, AND THE PARTIES HEREBY REPRESENT THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. THE PARTIES FURTHER REPRESENT THAT THEY HAVE BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF THEIR OWN FREE WILL, AND THEY HAVE HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
Section 7.13. Assignment by The Lender . The Lender may assign its rights and obligations under this Agreement or any of the other Loan Documents and may sell to any other Person participations in the Loan. If the Lender shall assign or participate its interest in the Loan to any Person that is a U.S. Person and is not taxed as a corporation for federal income tax purposes, such Person shall deliver to Borrower a completed IRS Form W-9 certifying that such Person is exempt from backup withholding on all payments under this Agreement. If the Lender shall assign or participate its interest in the Loan to any Person that is not a U.S. Person, such Person shall deliver to the Borrower a completed IRS Form W-8BEN or IRS Form W-8ECI certifying that such Person is exempt from withholding on all payments under this Agreement. Such Persons shall update such forms as necessary to reflect a change in circumstances or the passage of time. If an assignee or participant does not deliver the forms required under this Section 7.13 certifying that such Person is exempt from withholding, the Borrower shall not be required (i) to increase any payments as required under Section 2.4(d) with respect to withholding taxes imposed on payments with respect to such Persons interest in the Loan or (ii) indemnify any Person for any taxes under Section 2.4(d) imposed on any payments with respect to such Persons interest in the Loan.
Section 7.14. Confidentiality . The Lender hereby agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent requested by any regulatory authority; (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process; (d) to any other party to this Agreement; (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (f) subject to an agreement containing provisions substantially the same as those of this Section 7.14 , to (i) any assignee of or participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement or (ii) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterpartys or prospective counterpartys professional advisor) to any credit derivative transaction relating to obligations of the Borrower; (g) with the consent of the Borrower; (h) to the extent such Information (1) becomes publicly available other than as a result of a breach of this Section 7.14 or (2) becomes available to the Lender on a nonconfidential basis from a source other than the Borrower (unless such information became available from such source in violation of a
39
confidentiality obligation of such source with respect to such Information, of which obligation the Lender was aware) ; or (i) to any nationally recognized rating agency that requires access to information about the Lenders or its Affiliates investment portfolio in connection with ratings issued with respect to such Lender or its Affiliates. For the purposes of this Section 7.14 , Information means all information received from the Borrower relating to the Borrower or its business, other than any such information that is available to the Lender on a nonconfidential basis prior to disclosure by the Borrower. Any Person required to maintain the confidentiality of Information as provided in this Section 7.14 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information. Notwithstanding anything herein to the contrary, Information shall not include, and the Borrower and the Lender (and each employee, representative or other agent of the Borrower and the Lender) may disclose to any and all persons without limitation of any kind, any information with respect to the U.S. federal income tax treatment and U.S. federal income tax structure of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses) that are provided to the Borrower or the Lender relating to such tax treatment and tax structure.
[SIGNATURES BEGIN ON NEXT PAGE]
40
IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed as of the day and year first above written.
|
GREAT LAKES DREDGE & DOCK COMPANY |
|||
|
|
|
||
|
|
|
||
|
By: |
/s/ Deborah A. Wensel |
|
|
|
|
Name: Deborah A. Wensel |
||
|
|
Title: Senior Vice President, Chief Financial Officer and Treasurer |
||
|
|
|
||
|
|
|
||
|
GENERAL ELECTRIC CAPITAL
|
|||
|
|
|||
|
|
|||
|
By: |
/s/ Walter R. Schoultz |
|
|
|
|
Name: Walter R. Schoultz |
||
|
|
Title: Vice President |
||
Schedule 5.2(l)
Insurance Providers
1. The West of England Ship Owners Mutual Insurance Association
2. Lloyds of London and London Insurance Companies
Vessels
Vessel Name |
|
Official Number |
|
|
|
FLORIDA |
|
506446 |
KEY WEST |
|
684596 |
G.L. 184 |
|
652202 |
Exhibit 10.3
MANAGEMENT EQUITY AGREEMENT
AMONG
GLDD ACQUISITIONS CORP.
AND
EACH
OF THE PERSONS
LISTED ON THE
SCHEDULE OF EXECUTIVES HERETO
Dated as of December 22, 2003
THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR QUALIFIED UNDER STATE SECURITIES LAWS. THE SECURITIES ARE BEING SOLD IN RELIANCE UPON EXEMPTIONS FROM SUCH REGISTRATION AND QUALIFICATION REQUIREMENTS. THE SECURITIES CANNOT BE SOLD, TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFERABILITY SET FORTH IN THIS AGREEMENT AND APPLICABLE FEDERAL AND STATE SECURITIES LAWS.
i
MANAGEMENT EQUITY AGREEMENT
THIS MANAGEMENT EQUITY AGREEMENT (this Agreement ) is made as of December 22, 2003, among GLDD Acquisitions Corp., a Delaware corporation (the Company ), and each of the persons identified on the Schedule of Executives attached hereto (each an Executive ).
The Company and each Executive desire to enter into an agreement pursuant to which such Executive shall purchase, and the Company shall sell, certain shares of the Companys Common Stock, par value $.01 per share (the Common Stock ) and Series B Preferred Stock, par value $.01 per share (the Series B Preferred ), on the terms and subject to the conditions set forth in this Agreement. Capitalized terms not otherwise defined herein have the meanings set forth in Section 13 of this Agreement.
The parties hereto agree as follows:
1. Purchase and Sale of Common Stock .
1
2. Representations and Warranties; Acknowledgments .
Vesting Date |
|
Cumulative
Percentage of
|
|
|
|
|
|
December 22, 2004 |
|
20 |
% |
|
|
|
|
December 22, 2005 |
|
40 |
% |
|
|
|
|
December 22, 2006 |
|
60 |
% |
|
|
|
|
December 22, 2007 |
|
80 |
% |
|
|
|
|
December 22, 2008 |
|
100 |
% |
(1) Note that it is our expectation that all Common Stock acquired will be Incentive Shares.
then such Executive shall be entitled to receive from the Company or MDCP an amount per Called Share equal to such excess multiplied by the applicable FMV Price Percentage within 30 days after the closing of any such transaction or Subsequent Offering. FMV Price Percentage means 20% multiplied by the number of full years elapsed between the Effective Time of the Merger and the Termination Date for such Executive.
5. Restrictions on Transfer .
For example , if the Sale Notice contemplated a sale of 100 shares of Common Stock, and if MDCP at such time owns 40% of all
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shares of Common Stock and if an Executive elects to participate and such Executive owns 2% of all shares of Common Stock and if other persons owning an aggregate of 10% of all shares of Common Stock elect to participate in the contemplated sale, MDCP would be entitled to sell 76.9 shares (40% ÷ 52% x 100 shares), such Executive would be entitled to sell 3.9 shares (2% ÷ 52% x 100 shares) and the other persons would be entitled to sell 19.2 shares in the aggregate (10% ÷ 52% x 100 shares).
Each Person transferring shares of Common Stock pursuant to this Section 5(c) shall pay his, her or its pro rata share (based on the number of shares of Common Stock to be sold) of the expenses incurred by the persons transferring shares in connection with such Transfer and shall be obligated to join in any indemnification or other obligations that MDCP agrees to provide in connection with such Transfer (other than any such obligations that relate specifically to another person such as indemnification with respect to representations and warranties given by such other person regarding such other persons title to and ownership of shares of Common Stock).
THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON DECEMBER 22, 2003, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ACT ), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN A MANAGEMENT EQUITY AGREEMENT BETWEEN THE COMPANY AND CERTAIN OF ITS EMPLOYEES DATED AS OF DECEMBER 22, 2003, AS AMENDED AND MODIFIED FROM TIME TO TIME. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANYS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT FOR A PERIOD OF TIME TO A PURCHASE OPTION OF THE COMPANY APPLICABLE TO INCENTIVE SHARES AS DESCRIBED IN THE MANAGEMENT EQUITY AGREEMENT BETWEEN THE COMPANY AND CERTAIN OF ITS EMPLOYEES DATED AS OF DECEMBER 22, 2003, AS AMENDED AND MODIFIED FROM TIME TO TIME. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANYS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
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To the Company : |
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GLDD Acquisitions Corp. |
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c/o Madison Dearborn Partners, LLC |
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Three First National Plaza |
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70 W. Madison, Suite 3800 |
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Chicago, IL 60602 |
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Fax: (312) 895-1100 |
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Attention: |
Samuel M. Mencoff |
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Thomas S. Souleles |
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with a copy to: |
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Kirkland & Ellis LLP |
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200 E. Randolph Dr. |
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Chicago, IL 60601 |
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Fax: (312) 861-2200 |
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Attention: William S. Kirsch, P.C. |
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To Executive : |
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At the address listed below Executives name on the Schedule of Executives attached hereto |
or such other address or facsimile number or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this
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Agreement shall be deemed to have been given when so delivered or sent or, if mailed, five days after deposit in the U.S. mail.
* * * * *
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IN WITNESS WHEREOF, this Management Equity Agreement has been executed as of the date first written above.
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GLDD Acquisitions Corp. |
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By: |
/s/ Douglas B. Mackie |
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Its: |
President and Chief Executive Officer |
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/s/ Steven R. Auernhamer |
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Steven R. Auernhamer |
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/s/ Steven W. Becker |
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Steven W. Becker |
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/s/ Leslie A. Braun |
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Leslie A. Braun |
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/s/ David C. Cizek |
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David C. Cizek |
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/s/ Arthur S. Fletcher |
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Arthur S. Fletcher |
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/s/ James C. Gillespie |
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James C. Gillespie |
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/s/ William E. Hannum |
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William E. Hannum |
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/s/ Bradley T. J. Hansen |
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Bradley T. J. Hansen |
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/s/ William H. Hanson |
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William H. Hanson |
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/s/ Patrick C. Hughes |
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Patrick C. Hughes |
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/s/ Kyle D. Johnson |
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Kyle D. Johnson |
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/s/ John F. Karas |
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John F. Karas |
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/s/ Richard M. Lowry |
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Richard M. Lowry |
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/s/ Donald J. Luce |
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Donald J. Luce |
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/s/ Michael J. Luetlers |
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Michael J. Luetlers |
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/s/ Robert F. Mackay |
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Robert F. Mackay |
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Christopher T. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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/s/ Douglas B. Mackie |
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Douglas B. Mackie |
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Kathleen J. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Trustee |
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Madeline C. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Trustee |
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Natalie A. Mackie 1998 Trust |
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/s/ W. L. Coleman |
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Trustee |
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Philip D. Mackie 1998 Trust |
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/s/ W. L. Coleman |
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Trustee |
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/s/ John R. Maszezyk |
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John R. Maszezyk |
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/s/ Sam R. Morrison |
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Sam R. Morrison |
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/s/ William A. Murchison |
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William A. Murchison |
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/s/ John T. OBrien |
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John T. OBrien |
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/s/ Steven F. OHara |
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Steven F. OHara |
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/s/ William F. Pagendarm |
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William F. Pagendarm |
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/s/ Robert C. Ramsdell |
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Robert C. Ramsdell |
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/s/ T. Christopher Roberts |
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T. Christopher Roberts |
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/s/ Michael R. Sayer |
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Michael R. Sayer |
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/s/ David E. Simonelli |
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David E. Simonelli |
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/s/ George T. Strawn |
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George T. Strawn |
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/s/ Mark R. Thomas |
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Mark R. Thomas |
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/s/ Russell F. Zimmerman |
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Russell F. Zimmerman |
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Deborah A. Wensel Trust June 4, 1999 |
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By: |
/s/ Deborah A. Wensel |
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Trustee |
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/s/ Deborah A. Wensel |
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Deborah A. Wensel |
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/s/ James G. McNally |
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James G. McNally |
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/s/ Seann M. Perez |
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Seann M. Perez |
Exhibit 10.4
SUBSCRIPTION AGREEMENT
DATED AS OF DECEMBER 22, 2003
BY AND AMONG
GLDD ACQUISITIONS CORP.
AND THE PURCHASERS LISTED ON
THE SCHEDULE OF PURCHASERS
ATTACHED HERETO
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GLDD ACQUISITIONS CORP.
SUBSCRIPTION AGREEMENT
THIS AGREEMENT is made as of December 22, 2003, by and among GLDD Acquisitions Corp., a Delaware corporation (the Company ), and the Persons set forth on the Schedule of Purchasers attached hereto (hereinafter referred to collectively as the Purchasers and individually as a Purchaser ). The Purchasers will purchase, severally and not jointly, the Securities listed on the Schedule of Purchasers attached hereto. Capitalized terms used, but not otherwise defined herein, are defined in Section 9 hereof.
The parties hereto agree as follows:
Section 1. Authorization and Closing .
1A. Authorization of the Securities . The Company will (prior to Closing, as defined below) authorize the issuance and sale to the Purchasers of (i) an aggregate of 84,625 shares of the Companys Series A Preferred Stock, par value $0.01 per share (the Preferred Stock ), having the rights and preferences set forth in the Amended and Restated Certificate of Incorporation attached hereto as Exhibit A (the Certificate of Incorporation ), at a purchase price of $1,000 per share, and (ii) an aggregate of 850,000 shares of the Companys Common Stock, par value $0.01 per share (the Common Stock ), at a purchase price of $10 per share. The Preferred Stock and the Common Stock are sometimes collectively referred to herein as Securities .
1C. The Closing . The closing of the purchase and sale of the Securities (the Closing ) shall take place at the offices of Kirkland & Ellis LLP, 200 East Randolph Drive, Chicago, IL 60601 simultaneously with the Closing of the Acquisition, as defined below. At the Closing, the Company shall deliver to each Purchaser instruments evidencing the Securities to be purchased by such Purchaser registered in the Purchasers name upon payment of the purchase price thereof by wire transfer of immediately available funds in the aggregate amount set forth on the Schedule of Purchasers to an account specified by the Company prior to the Closing.
Section 2. Conditions of Each Purchasers Obligation at the Closing . The obligation of each Purchaser to purchase and pay for the Securities at the Closing is subject to the satisfaction as of the Closing of the following conditions:
2A. Representations and Warranties; Covenants . The representations and warranties contained in Section 6 hereof shall be true and correct in all material respects at and
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as of the Closing as though then made, except to the extent of changes caused by the execution, delivery and performance of the agreements expressly referred to in this Section 2 , and the Company shall have performed in all material respects all of the covenants and agreements required to be performed by it hereunder prior to or at the Closing.
2B. Amendment of Certificate of Incorporation . The Companys Certificate of Incorporation shall have been amended to include the provisions set forth in Exhibit A hereto, shall be in full force and effect under the laws of Delaware as of the Closing as so amended and shall not have been further amended or modified.
2C. Amendment of the Companys Bylaws . The Companys Bylaws shall have been amended and restated in the form set forth in Exhibit B hereto and shall be in full force and effect as of the Closing as so amended and restated and shall not have been further amended or modified.
2D. Registration Rights Agreement . The Company and the Purchasers shall have entered into a registration rights agreement in form and substance as set forth in Exhibit C attached hereto (the Registration Rights Agreement ), and the Registration Rights Agreement shall be in full force and effect as of the Closing.
2E. Management Agreement . The Company shall have entered into a Management Equity Agreement, in form and substance as set forth in Exhibit D attached hereto (the Management Agreement ), and the Management Agreement shall not have been amended or modified and shall be in full force and effect as of the Closing.
2F. Securities Law Compliance . The Company shall have made all filings under all applicable federal and state securities laws necessary to consummate the issuance of the Securities pursuant to this Agreement in compliance with such laws.
2G. Closing Fee to MDP . At the Closing, the Company shall, or shall cause its Subsidiaries to, pay to Madison Dearborn Capital Partners IV, L.P. ( MDP ) or its designee, a closing fee of $3,570,000.
2H. Merger Agreement . The Agreement and Plan of Merger, dated as of November 12, 2003, among the Company, GLDD Merger Sub, Inc., Great Lakes Dredge & Dock Corporation ( GLDD ) and Vectura Holding Company LLC (the Merger Agreement ), shall be in full force and effect as of the Closing, and the Merger Agreement shall not have been amended or modified in any material respect. The acquisition contemplated by the Merger Agreement (the Acquisition ) shall have been consummated without waiver of any condition to GLDDs obligations thereunder.
2I. Bank Agreement . The Company, GLDD, certain Subsidiaries of GLDD, Lehman Brothers Inc., Credit Suisse First Boston, acting through its Cayman Islands Branch, Bank of America N.A., the financial institutions from time to time party thereto, as lenders, GLDD and certain Subsidiaries of GLDD shall have entered into that certain Credit Agreement and related documents (collectively, the Bank Agreement ) in form and substance satisfactory
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to MDP and the Bank Agreement shall not have been amended or modified and shall be in full force and effect as of the Closing.
2J. HYD Offering . GLDD shall have received not less than $170,000,000 in an offering of GLDDs Senior Subordinated Notes on terms reasonably satisfactory to MDP.
2K. Closing Documents . The Company shall have delivered to each Purchaser all of the following documents:
2L. Proceedings . All corporate and other proceedings taken or required to be taken by the Company in connection with the Transactions to be consummated at or prior to the Closing and all documents incident thereto shall be reasonably satisfactory in form and substance to MDP.
2M. Compliance with Applicable Laws . The purchase of the Securities by each Purchaser hereunder shall not be prohibited by any applicable law or governmental rule or regulation.
2N. Government Consents; Waiting Periods . The Company shall have obtained all necessary government consents and approvals, made all required governmental
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filings (including under the HSR Act), and all waiting periods applicable under the HSR Act shall have expired or been terminated.
2O. Waiver . Any condition specified in this Section 2 may be waived on behalf of the Purchasers if consented to in writing by MDP.
Section 3. Transfer of Restricted Securities.
3A. General Provisions . In addition to any other restrictions on transfer to which such shares may be subject, Restricted Securities are transferable only pursuant to (i) Public Offerings registered under the Securities Act, (ii) Rule 144 or Rule 144A of the Securities and Exchange Commission (or any similar rule or rules then in force) if such rule is available and (iii) subject to the conditions specified in Section 3B below, any other legally available means of transfer.
3B. Opinion Delivery . In connection with the transfer of any Restricted Securities (other than a transfer described in Section 3A(i) or (ii) above), upon the request of the Company, the holder thereof shall deliver written notice to the Company describing in reasonable detail the transfer or proposed transfer, together with an opinion of Kirkland & Ellis LLP or other counsel which (to the Companys reasonable satisfaction) is knowledgeable in securities law matters to the effect that such transfer of Restricted Securities may be effected without registration of such Restricted Securities under the Securities Act. In addition, if the holder of the Restricted Securities delivers to the Company an opinion of Kirkland & Ellis LLP or such other counsel that no subsequent transfer of such Restricted Securities shall require registration under the Securities Act, the Company shall promptly upon such contemplated transfer deliver new certificates for such Restricted Securities which do not bear the Securities Act legend set forth in Section 3C . If the Company is not required to deliver new certificates for such Restricted Securities not bearing such legend, the holder thereof shall not transfer the same until the prospective transferee has confirmed to the Company in writing its agreement to be bound by the conditions contained in this Section 3 .
3C. Legend . Each certificate or instrument representing Restricted Securities shall be imprinted with a legend in substantially the following form:
The securities represented by this certificate were originally issued on December 22, 2003, and have not been registered under the Securities Act of 1933, as amended or any applicable state securities laws. The transfer of the securities represented by this certificate is subject to the conditions specified in the Subscription Agreement dated as of December 22, 2003, as amended and modified from time to time, between the issuer (the Company ) and certain investors, and the Company reserves the right to refuse the transfer of such securities until such conditions have been fulfilled with respect to such transfer. A copy of such conditions shall be furnished by the Company to the holder hereof upon written request and without charge.
3D. Legend Removal . If any Restricted Securities become eligible for sale pursuant to Rule 144(k), the Company shall, upon the request of the holder of such Restricted
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Securities, remove the legend set forth in Section 3C from the certificates for such Restricted Securities.
3E. Additional Transfer Restrictions . No Purchaser shall transfer, sell or otherwise dispose (whether voluntarily, involuntarily or by operation of law) of any Preferred Stock or Common Stock acquired hereunder or hereafter acquired by any such Purchaser without the prior written consent of MDP and any transfer, sale or disposition of Preferred Stock or Common Stock in violation of this Section 3E shall be void ab initio . As a condition to any such transfer, sale or disposition, the Purchaser (or any transferee thereof) will cause the transferee or purchaser thereof to execute a counterpart to this Agreement (and any other agreement reasonably requested by MDP) and become party to this Agreement (and such other agreements) as a Purchaser.
Section 4. Sale of the Company .
4A. Approved Sale . If the Board and MDP approve a Sale of the Company (the Approved Sale ), all holders of Restricted Securities shall consent to, vote for and raise no objections against the Approved Sale, and if the Approved Sale is structured as a sale of stock, the holders of Restricted Securities shall agree to sell their Restricted Securities on the terms and conditions approved by the Board and MDP. The holders of Restricted Securities shall take all necessary and desirable actions in connection with the consummation of the Approved Sale and shall not impair or delay the Approved Sale. In furtherance of the foregoing, if the Approved Sale is structured as (A) a merger or consolidation, each holder of Restricted Securities shall vote its Restricted Securities to approve such merger or consolidation, whether by written consent or at a stockholders meeting (as requested by MDP), and waive all dissenters rights, appraisal rights and similar rights in connection with such merger or consolidation, (B) a sale of stock, each holder of Restricted Securities shall agree to sell, and shall sell, all of its Restricted Securities and rights to acquire Restricted Securities on the terms and conditions so approved, or (C) a sale of assets, each holder of Restricted Securities shall vote its Restricted Securities to approve such sale and any subsequent liquidation of the Company or other distribution of the proceeds therefrom, whether by written consent or at a stockholders meeting (as requested by MDP), and waive all dissenters rights, appraisal rights and similar rights in connection with such sale of assets.
4B. Additional Obligations . In furtherance of its obligations under Section 4A above, (I) each holder of Restricted Securities will take all necessary or desirable actions reasonably requested by MDP in connection with the consummation of the Approved Sale and (II) each holder of Restricted Securities will make the same representations, warranties, indemnities and agreements as each other holder, including without limitation, voting to approve such transaction and executing all documents requested by MDP to be executed by such holder, including the applicable purchase agreement, stockholders agreement and/or indemnification and/or contribution agreement. Without limiting the generality of the foregoing, in any Approved Sale, (i) each holder of Restricted Securities shall be obligated to make representations and warranties as to such holders title to and ownership of Restricted Securities, authorization, execution and delivery of relevant documents by such holder, enforceability of relevant agreements against such holder and other matters relating to such holder, to enter into covenants in respect of a transfer of such holders Restricted Securities in connection with such Approved
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Sale (including, without limitation, the delivery of certificates, stock powers and other instruments of transfer) and to enter into indemnification obligations with respect to the foregoing, in each case to the extent that each other holder of the same type of Restricted Securities is similarly obligated; provided that no holder shall be obligated to enter into indemnification obligations with respect to any of the foregoing to the extent relating to any other holder of Restricted Securities or such other holders Restricted Securities (other than, in the case of a Rollover Investor, a transferee of such holders Restricted Securities), and (ii) in no event shall any holder of Restricted Securities be liable in respect of any indemnity obligations pursuant to any Approved Sale in an aggregate amount in excess of the total consideration payable to such holder in such Approved Sale.
4C. Conditions to Obligations . The obligations of the holders of Restricted Securities with respect to the Approved Sale are subject to the satisfaction of the following conditions: (i) upon the consummation of the Approved Sale, all of the holders of the Common Stock shall receive the same form and amount of consideration per share of the Common Stock, or if any holders of the Common Stock are given an option as to the form and amount of consideration to be received, all holders shall be given the same option; and (ii) all holders of then currently exercisable rights to acquire shares of the Common Stock shall be given an opportunity to either (A) exercise such rights prior to the consummation of the Approved Sale and participate in such sale as holders of the Common Stock or (B) upon the consummation of the Approved Sale, receive in exchange for such rights consideration equal to the amount determined by multiplying (1) the same amount of consideration per share of the Common Stock received by the holders of the Common Stock in connection with the Approved Sale less the exercise price per share of the Common Stock of such rights to acquire the Common Stock by (2) the number of shares of the Common Stock represented by such rights.
4D. Purchaser Representative . If the Company or the holders of the Companys securities enter into any negotiation or transaction for which Rule 506 (or any similar rule then in effect) promulgated by the Securities Exchange Commission may be available with respect to such negotiation or transaction (including a merger, consolidation or other reorganization), the holders of Restricted Securities shall, at the request of the Company, appoint a purchaser representative (as such term is defined in Rule 501) reasonably acceptable to the Company. If any holder of Restricted Securities appoints a purchaser representative designated by the Company, the Company shall pay the fees of such purchaser representative. However, if any holder of Restricted Securities declines to appoint the purchaser representative designated by the Company, such holder shall appoint another purchaser representative (reasonably acceptable to the Company), and such holder shall be responsible for the fees of the purchaser representative so appointed
4E. Cost Sharing . Each holder of Restricted Securities shall bear his or her pro rata share (based upon the number of shares sold) of the costs of any sale of Restricted Securities pursuant to an Approved Sale to the extent such costs are incurred for the benefit of all holders of the Common Stock and are not otherwise paid by the Company or the acquiring party. Costs incurred by each such holder of Restricted Securities on his or her own behalf shall not be considered costs of the transaction hereunder.
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Section 5. Distributions Upon Sale of the Company . In the event of a Sale of the Company (whether or not such Sale of the Company constitutes an Approved Sale pursuant to Section 4 above), (a) each holder of Restricted Securities shall receive in exchange for the Restricted Securities held by such holder, the same portion of the aggregate consideration from such sale or exchange that such holder of Restricted Securities would have received if such aggregate consideration had been distributed by the Company in complete liquidation pursuant to the rights and preferences set forth in the Companys certificate of incorporation as in effect immediately prior to such sale or exchange (as reduced in the case of holders of rights to acquire any class of Stockholder Shares by the exercise price per share thereof) and (b) each holder of Restricted Securities shall be obligated to join in any indemnification or other obligations that MDCP agrees to provide (including, without limitation, by way of escrow or holdback of any sale proceeds) in connection with such Sale of the Company (other than any such obligations that relate specifically to a holder of Restricted Securities such as indemnification with respect to representations and warranties given by a holder regarding such holders title to and ownership of Restricted Securities), with such holders bearing such liabilities or obligations with the same economic effect, consistent with clause (a) of the foregoing, as if such liabilities or obligations reduced the aggregated consideration payable to the Companys stockholders in such Sale of the Company prior to the consummation thereof; provided, however, that in no case shall any such holders indemnity obligation exceed the dollar value of the proceeds received by such holder in such Sale of the Company.
Section 6. Representations and Warranties of the Company . As a material inducement to the Purchasers to enter into this Agreement and purchase the Securities hereunder, the Company hereby represents and warrants to each Purchaser as of the date hereof as follows:
6A. Organization, Corporate Power and Licenses . The Company is a corporation duly organized, validly existing and in good standing under the laws of Delaware and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial condition, operating results, assets, operations or business prospects of the Company and its Subsidiaries taken as a whole. The Company possesses all requisite corporate power and authority and all material licenses, permits and authorizations necessary to own and operate its properties, to carry on its businesses as now conducted and presently proposed to be conducted and to carry out the transactions contemplated by this Agreement (including, without limitation, the issuance of the Securities hereunder). The copies of the Companys Certificate of Incorporation and Bylaws which have been furnished to the Purchasers reflect all amendments made thereto at any time prior to the date of this Agreement and are correct and complete.
6B. Capital Stock and Related Matters .
6C. Subsidiaries; Investments . Upon consummation of the transactions contemplated in the Merger Agreement, the Company shall own (directly or indirectly) all of the outstanding capital stock of GLDD.
6D. Authorization; No Breach . The execution, delivery and performance of this Agreement (including the issuance and delivery of the Securities hereunder) and the other Transaction Agreements to which the Company is a party, the amendment and restatement of the Companys Certificate of Incorporation and the amendment and restatement of the Companys Bylaws have been duly and validly authorized by the Companys board of directors and (as applicable) approved by the required vote of the Companys stockholders. This Agreement and the other Transaction Agreements to which the Company is a party each constitutes a valid and binding obligation of the Company, enforceable in accordance with its terms. The execution and delivery by the Company of this Agreement and the other Transaction Agreements to which the Company is a party, the offering, sale and issuance of the Securities hereunder, the amendment and restatement of the Certificate of Incorporation and the Companys Bylaws and the fulfillment of and compliance with the respective terms hereof and thereof by the Company, do not and shall not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the Companys capital stock or assets pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of, or (vi) require any authorization, consent, approval, exemption or other action by or notice or declaration to, or
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filing with, any court or administrative or governmental body or agency or other Person pursuant to, the Certificate of Incorporation or Bylaws of the Company, or any law, statute, rule or regulation to which the Company is subject, or any agreement, instrument, order, judgment or decree to which the Company is subject.
6E. Conduct of Business . Except in connection with the transactions contemplated hereby and by the Merger Agreement (and before giving effect to the Acquisition), the Company has no assets, has not conducted any business, incurred any material expenses, obligations or liabilities or entered into any written contract, lease, license, agreement, letter agreement or other instrument.
6F. Litigation, etc . There are no actions, suits, proceedings, orders, investigations or claims pending or, to the Companys knowledge, threatened against the Company or pending or threatened by the Company against any third party, at law or in equity, or before or by any governmental department, commission, board, bureau, agency or instrumentality (including any actions, suit, proceedings or investigations with respect to the transactions contemplated by this Agreement and the Transaction Agreements).
6G. Brokerage . There are no claims for brokerage commissions, finders fees or similar compensation in connection with the transactions contemplated by this Agreement based on any arrangement or agreement binding upon the Company.
6H. Governmental Consent, etc . To the actual knowledge of the Company: (i) no permit, consent, approval or authorization of, or declaration to or filing with, any governmental authority is required in connection with the execution, delivery and performance by the Company of this Agreement or the other Transaction Agreements, or the consummation by the Company of the Transactions and (ii) no permit, consent, approval or authorization of, or declaration to or filing with, any governmental authority was required in connection with the formation of the Company, other than filing with the Delaware Secretary of State, except for the matters disclosed in or contemplated by the Merger Agreement and except for filings required under the HSR Act.
6I. Solvency, etc. The Company is solvent as of the date of this Agreement and shall not become insolvent as a result of the consummation of the Transactions. The Company is, and after giving effect to the Transactions shall be, able to pay its debts as they become due, and the Companys property now has, and after giving effect to the Transactions shall have, a fair salable value greater than the amounts required to pay its debts (including a reasonable estimate of the amount of all contingent liabilities). The Company has adequate capital to carry on its business, and after giving effect to the Transactions, the Company shall have adequate capital to conduct its business. No transfer of property is being made and no obligation is being incurred in connection with the Transactions with the intent to hinder, delay or defraud either present or future creditors of the Company.
6J. Investment Company . The Company is not an investment company as defined under the Investment Company Act of 1940, as amended.
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6K. Bank Agreement . As of the date hereof, neither the Company nor any borrower or guarantor party to the Bank Agreement is in breach of any representation or warranty contained therein.
Section 7. Representations and Warranties of the Purchasers .
7A. Purchasers Investment Representations . As a material inducement to the Company to enter into this Agreement and to sell the Securities hereunder, each Purchaser represents and warrants (severally as to itself only) to the Company as of the date hereof as follows:
Section 8. Covenants .
8A. Financial Statements and Other Information . The Company shall deliver to each holder of more than 15% of the Restricted Securities acquired hereunder:
Each of the financial statements referred to in subparagraph (i) and (iii) above shall be true and correct in all material respects as of the dates and for the periods stated therein, subject in the case of the unaudited financial statements to changes resulting from normal year-end adjustments for recurring accruals (none of which would, alone or in the aggregate, be materially adverse to the business, condition (financial or otherwise), operating results, assets, liabilities, operations, business prospects or customer, supplier or employee relations of the Company and its Subsidiaries taken as a whole).
8B. Inspection Rights . The Company shall permit any representatives designated by any holder of more than 15% of the Restricted Securities acquired hereunder, upon reasonable notice and during normal business hours and at such other times as any such Purchaser may reasonably request, to (i) visit and inspect any of the properties of the Company and its Subsidiaries, (ii) examine the corporate and financial records of the Company and its Subsidiaries and make copies thereof or extracts therefrom and (iii) discuss the affairs, finances and accounts of any such corporations with the directors, officers, key employees and
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independent accountants of the Company and its Subsidiaries. The presentation of an executed copy of this Agreement by any such holder to the Companys independent accountants shall constitute the Companys permission to its independent accountants to participate in discussions with such Persons.
8C. Restrictions . The Company shall not, without the prior written consent of MDP:
8D. Affirmative Covenants . The Company shall, and shall cause each Subsidiary to, unless it has received the prior written consent of the holders of Securities holding at least a majority of the Common Stock held by all such holders:
8E. Compliance with Agreements . The Company shall perform and observe (i) all of its obligations to each holder of the Preferred Stock and Common Stock set forth in its certificate of incorporation and bylaws, and (ii) all of its obligations under the Registration Rights Agreement and the other Transaction Agreements.
Section 9. Definitions .
9A. Definitions . For the purposes of this Agreement, the following terms have the meanings set forth below:
Board means the Companys Board of Directors.
HSR Act shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
Independent Third Party means any Person who, immediately prior to the contemplated transaction, does not own in excess of 5% of the Companys Common Stock on a fully-diluted basis (a 5% Owner ), who is not controlling, controlled by or under common control with any such 5% Owner and who is not the spouse or descendent (by birth or adoption) of any such 5% Owner or a trust for the benefit of such 5% Owner and/or such other Persons.
Officers Certificate means a certificate signed by the Companys president or its chief financial officer, stating that (i) the officer signing such certificate has made or has caused to be made such investigations as are necessary in order to permit him to verify the accuracy of the information set forth in such certificate and (ii) to the best of such officers actual knowledge, such certificate does not misstate any material fact and does not omit to state any fact necessary to make the certificate not misleading.
Person means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Public Offering means any offering by the Companys equity securities to the public pursuant to an effective registration statement under the Securities Act, or any comparable statement under any similar federal statute then in force.
Restricted Securities means (i) the Securities issued hereunder, and (ii) any securities issued with respect to the securities referred to in clause (i) above by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization. As to any particular Restricted Securities, such securities shall cease to be Restricted Securities when they have (a) been effectively registered under the Securities Act and disposed of in accordance with the registration statement covering them, or (b) been distributed to the public through a broker, dealer or market maker pursuant to Rule 144 (or any similar provision then in force) under the Securities Act or become eligible for sale pursuant to Rule 144(k) (or any similar provision then in force) under the Securities Act. Whenever any particular securities cease to be Restricted Securities, the holder thereof shall be
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entitled to receive from the Company, without expense, new securities of like tenor not bearing a Securities Act legend of the character set forth in Section 3C .
Sale of the Company means the sale of the Company to an Independent Third Party or group of Independent Third Parties pursuant to which such party or parties acquire (i) capital stock of the Company possessing the voting power under normal circumstances to elect a majority of the Board (whether by merger, consolidation or sale or transfer of the Companys capital stock) or (ii) all or substantially all of the Companys assets determined on a consolidated basis.
Securities Act means the Securities Act of 1933, as amended, or any similar federal law then in force.
Securities and Exchange Commission means the U.S. Securities and Exchange Commission and includes any governmental body or agency succeeding to the functions thereof.
Securities Exchange Act means the Securities Exchange Act of 1934, as amended, or any similar federal law then in force.
Subsidiary means, with respect to any Person, any corporation, limited liability company, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a limited liability company, partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing director or general partner of such limited liability company, partnership, association or other business entity.
Section 10. Certain Voting Agreements .
10A. Each Purchaser hereby agrees that such Purchaser will vote, or cause to be voted, all voting Restricted Securities over which such Purchaser has the power to vote or direct the voting, either in person or by proxy, whether at a stockholders meeting, or by written consent, in the manner in which MDCP directs in connection with (i) approval of any amendment or amendments to the Companys Certificate of Incorporation or bylaws, (ii) any merger, combination or consolidation of the Company with any Independent Third Party, (iii) the sale, lease or exchange of all or substantially all of the assets of the Company and its Subsidiaries on a consolidated basis to an Independent Third Party, or (iv) the reorganization, recapitalization, liquidation, dissolution or winding-up of any of the Company and its Subsidiaries; provided , however, that no such action shall (a) contravene the terms of this Agreement, or (b) have a material adverse effect on the rights or interests of any Purchaser in respect of any of its
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Restricted Securities that would be borne disproportionately by such Purchaser relative to the effect of such action on the rights or interests of other Purchasers in respect of holdings of Restricted Securities of the same class, unless approved by holders of a majority of the Restricted Securities so adversely affected.
10B. In order to secure the obligations of each Purchaser who now or hereafter holds any voting securities to vote such Persons Restricted Securities in accordance with the provisions of this Agreement, each Purchaser hereby appoints MDP as his or its true and lawful proxy and attorney-in-fact, with full power of substitution, to vote all of his or its Restricted Securities, which irrevocable proxy MDP may exercise at any time. The proxies and powers granted by each such Purchaser pursuant to this Section 10B are coupled with an interest and are given to secure the performance of such Purchasers obligations under this Agreement. Such proxies and powers shall be irrevocable until termination of this Section 10 and shall survive the death, incompetency, disability, bankruptcy or dissolution of each Purchaser and the subsequent holders of his or its Restricted Securities. No Purchaser shall grant any proxy or become party to any voting trust or other agreement which is inconsistent with, conflicts with or violates any provision of this Agreement.
Section 11. Miscellaneous .
11A. Expenses . The Company shall pay to MDP, and hold MDP harmless against liability for the payment of, (i) the fees and expenses of its special counsel arising in connection with the negotiation and execution of this Agreement and the consummation of the transactions contemplated by this Agreement, which shall be payable at the Closing or, if the Closing does not occur, payable upon demand, (ii) the fees and expenses incurred with respect to any amendments or waivers (whether or not the same become effective) under or in respect of this Agreement, the agreements contemplated hereby or the Certificate of Incorporation, (iii) the fees and expenses incurred with respect to the enforcement of the rights granted under this Agreement, the agreements contemplated hereby and the Certificate of Incorporation, (iv) the fees and expenses incurred by MDP in connection with any transaction, claim or event which MDP believes affects the Company and as to which MDP seeks the advice of outside professionals, (v) the fees and expenses incurred by MDP in connection with any investment initiative pursued prior to the date hereof with the Companys Chief Executive Officer and (vi) the fees and expenses incurred by MDP in connection with (A) the monitoring and management of the Company and its Subsidiaries and (B) a Sale of the Company.
11B. Indemnification . The Company hereby covenants and agrees to indemnify and hold harmless each of the Purchasers, their respective officers, directors, stockholders, affiliates, successors, assigns, agents and other representatives, from and against any and all damages, losses, claims, liabilities, deficiencies, costs and expenses (including, without limitation, reasonable attorneys fees), resulting from any material breach of any of the representations, warranties or covenants of the Company under this Agreement.
11C. Survival of Representations and Warranties . All representations and warranties contained herein or made in writing by any party in connection herewith shall survive the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby through the first anniversary of the Closing; provided , however, that the
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representations and warranties contained in Section 6B , Section 6D and Section 6G hereof shall survive the Closing for the applicable statute of limitations.
11D. Remedies . The Purchasers shall have all rights and remedies set forth in this Agreement and all rights and remedies which the Purchasers have been granted at any time under any other agreement or contract and all of the rights which the Purchasers have under any law. The Purchasers shall be entitled to enforce all rights they have under this Agreement, the other Transaction Agreements and the Securities specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law.
11E. Consent to Amendments . Except as otherwise expressly provided herein, the provisions of this Agreement may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of MDP.
11F. Successors and Assigns . Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not. In addition, and whether or not any express assignment has been made, the provisions of this Agreement which are for any Purchasers benefit as a purchaser or holder of Securities are also for the benefit of, and enforceable by, any subsequent holder of such Securities.
11G. Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.
11H. No Third Party Beneficiaries . Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any Person other than the parties hereto and their respective permitted successors and assigns, any rights or remedies under or by reason of this Agreement.
11I. Counterparts . This Agreement may be executed simultaneously in two or more counterparts (including by facsimile), any one of which need not contain the signatures of more than one party, but all such counterparts taken together shall constitute one and the same Agreement.
11J. Descriptive Headings; Interpretation . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a substantive part of this Agreement. The use of the word including in this Agreement shall be by way of example rather than by limitation.
11K. Governing Law . All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement and the exhibits and schedules
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hereto shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. In furtherance of the foregoing, the internal law of the State of Delaware shall control the interpretation and construction of this Agreement (and all schedules and exhibits hereto), even though under that jurisdictions choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.
11L. Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given when delivered personally to the recipient, sent to the recipient by reputable overnight courier service (charges prepaid) or mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid. Such notices, demands and other communications shall be sent to the Purchasers at the addresses indicated on the Schedule of Purchasers attached hereto, to the Company at the following address:
GLDD Acquisitions Corp. |
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c/o Madison Dearborn Capital Partners IV, L.P. |
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70 W. Madison, Suite 3800 |
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Three First National Plaza |
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Chicago, Illinois 60602 |
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Facsimile: (312) 422-2424 |
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Attention: |
Samuel M. Mencoff |
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Thomas S. Souleles |
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with a copy to: |
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Kirkland & Ellis LLP |
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200 East Randolph Drive |
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Chicago, IL 60601 |
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Facsimile: (312) 861-2200 |
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Attention: |
William S. Kirsch, P.C. |
or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.
11M. No Strict Construction . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above.
GLDD ACQUISITIONS CORP. |
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/s/ Douglas B. Mackie |
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President and Chief Executive Officer |
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NORTHWESTERN UNIVERSITY |
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By: |
/s/ William H. McLean |
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Vice President and Chief Investment Officer |
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RANDOLPH STREET PARTNERS VI |
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By: |
/s/ William S. Kirsch, P.C. |
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Partner |
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LIST OF EXHIBITS AND DISCLOSURE SCHEDULES
Exhibits
Exhibit A |
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Amended and Restated of Certificate of Incorporation |
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Exhibit B |
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Amended and Restated Bylaws |
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Exhibit C |
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Registration Rights Agreement |
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Exhibit D |
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Management Agreement |
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Disclosure Schedules |
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Schedule of Purchasers |
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Capitalization Schedule |
Exhibit 10.5
GLDD ACQUISITIONS CORP.
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this Agreement ) is made as of December 22, 2003, by and among GLDD Acquisitions Corp., a Delaware corporation (the Company ); Madison Dearborn Capital Partners IV, L.P., a Delaware corporation ( MDCP ) and each of the Persons listed on the signature pages hereto as Other Investors (the Other Investors ). Capitalized terms used but not otherwise defined herein have the meanings set forth in Section 7 hereof.
MDCP and certain Other Investors purchasing shares of Common Stock and Series A Preferred Stock of the Company pursuant to a Subscription Agreement among MDCP, the Company and certain other Persons party thereto, dated as of December 22, 2003 (as amended or modified from time to time, the Subscription Agreement ).
Certain Other Investors that are members of management of the Company and its Subsidiaries are acquiring shares of Common Stock and Series B Preferred Stock of the Company pursuant to a Management Equity Agreement among the Other Investors and the Company dated as of December 22, 2003 (as amended or modified from time to time, the Management Equity Agreement ).
The execution and delivery of this Agreement is a condition to MDCPs purchase of the Common Stock and Series A Preferred Stock pursuant to the Subscription Agreement and the Other Investors acquisition of the Common Stock and Series B Preferred Stock pursuant to the Management Equity Agreement.
The parties hereto agree as follows:
Common Stock means the Companys Common Stock, par value $0.01 per share.
MDCP Registrable Securities means (i) any shares of Common Stock originally issued to MDCP pursuant to the Subscription Agreement, (ii) any Common Stock issued or issuable with respect to the securities referred to in clause (i) by way of a stock dividend or stock split or stock conversion or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization and (iii) any other Common Stock of the Company acquired by MDCP. As to any particular MDCP Registrable Securities, such securities shall cease to be MDCP Registrable Securities when they have been distributed to the public pursuant to an offering registered under the Securities Act or sold to the public through a broker, dealer or market maker in compliance with Rule 144 under the Securities Act (or any similar rule then in force) or a sale to the public pursuant to Rule 144(k). For purposes of this Agreement, a Person shall be deemed to be a holder of MDCP Registrable Securities whenever such Person has the right to acquire such MDCP Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.
Other Investor Registrable Securities means (i) any shares of Common Stock originally issued to an Other Investor pursuant to the Subscription Agreement or Management Equity Agreement, (ii) any Common Stock issued or issuable with respect to the securities referred to in clause (i) by way of a stock dividend or stock split or stock conversion or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization and (iii) any other Common Stock of the Company acquired by the Other Investors. As to any particular Other Investor Registrable Securities, such securities shall cease to be Other Investor Registrable Securities when they have been distributed to the public pursuant to an offering registered under the Securities Act or sold to the public through a broker, dealer or market maker in compliance with Rule 144 under the Securities Act (or any similar rule then in force) or a sale to the public pursuant to Rule 144(k). For purposes of this Agreement, a Person shall be deemed to be a holder of Other Investor Registrable Securities whenever such Person has the right to acquire such Other Investor Registrable Securities (upon conversion or
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exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.
Public Offering means the sale in an underwritten public offering registered under the Securities Act of shares of the Common Stock.
Registrable Securities means, collectively, MDCP Registrable Securities and Other Investor Registrable Securities.
Securities Act means the Securities Act of 1933, as amended from time to time.
Series A Preferred Stock means Series A Preferred Stock of the Company, par value $0.01 per share.
Series B Preferred Stock means Series B Preferred Stock of the Company, par value $0.01 per share.
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IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first written above.
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NORTHWESTERN UNIVERSITY |
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/s/ William H. McLean |
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Vice President and Chief Investment Officer |
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Address : |
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c/o Investment Department
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Attention: |
Du Chai |
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RANDOLPH STREET PARTNERS VI |
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By: |
/s/ William S. Kirsch, P.C. |
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Its: |
Partner |
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Address : |
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c/o Jack S. Levin
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/s/ Steven R. Auernhamer |
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Steven R. Auernhamer |
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/s/ Steven W. Becker |
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Steven W. Becker |
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/s/ Leslie A. Braun |
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Leslie A. Braun |
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/s/ David C. Cizek |
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David C. Cizek |
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/s/ Arthur S. Fletcher |
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Arthur S. Fletcher |
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/s/ James C. Gillespie |
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James C. Gillespie |
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/s/ William E. Hannum |
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William E. Hannum |
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/s/ Bradley T. J. Hansen |
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Bradley T. J. Hansen |
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/s/ William H. Hanson |
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William H. Hanson |
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/s/ Patrick C. Hughes |
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Patrick C. Hughes |
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/s/ Kyle D. Johnson |
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Kyle D. Johnson |
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/s/ John F. Karas |
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John F. Karas |
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/s/ Donald J. Luce |
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Donald J. Luce |
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/s/ Richard M. Lowry |
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Richard M. Lowry |
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/s/ Michael J. Lueders |
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Michael J. Lueders |
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Christopher T. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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/s/ Douglas B. Mackie |
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Douglas B. Mackie |
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Kathleen J. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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Madeline C. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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Natalie A. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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Philip D. Mackie 1998 Trust |
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By: |
/s/ W. L. Coleman |
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Its: |
Trustee |
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/s/ John R. Maszezyk |
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John R. Maszezyk |
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/s/ Sam R. Morrison |
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Sam R. Morrison |
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/s/ William A. Murchison |
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William A. Murchison |
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/s/ John T. OBrien |
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John T. OBrien |
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/s/ Steven F. OHara |
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Steven F. OHara |
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/s/ William F. Pagendarm |
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William F. Pagendarm |
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/s/ Robert C. Ramsdell |
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Robert C. Ramsdell |
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/s/ T. Christopher Roberts |
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T. Christopher Roberts |
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/s/ Michael R. Sayer |
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Michael R. Sayer |
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/s/ David E. Simonelli |
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David E. Simonelli |
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/s/ George T. Strawn |
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George T. Strawn |
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/s/ Mark R. Thomas |
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Mark R. Thomas |
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/s/ Russell F. Zimmerman |
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Russell F. Zimmerman |
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/s/ James G. McNally |
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James G. McNally |
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/s/ Deborah A. Wensel |
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Deborah A. Wensel |
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Deborah A. Wensel Trust June 4, 1999 |
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By: |
Deborah A. Wensel |
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Its: |
Trustee |
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/s/ Seann M. Perez |
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Seann M. Perez |
Exhibit 10.6
EXECUTIVE VERSION
THIRD AMENDED AND RESTATED
UNDERWRITING AND CONTINUING
INDEMNITY AGREEMENT
dated
December 22, 2003
among
GREAT LAKES DREDGE & DOCK CORPORATION,
CERTAIN OF ITS SUBSIDIARIES,
TRAVELERS CASUALTY AND SURETY COMPANY
and
TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA
TABLE OF CONTENTS
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EXHIBIT A |
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Form of Supplemental Signature Page |
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EXHIBIT B |
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Form of Pledge Agreement |
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EXHIBIT C |
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Form of Security Agreement (A/R) |
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EXHIBIT D |
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Form of Security Agreement (Equipment) |
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EXHIBIT E |
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Form of Vessel Mortgage (First) |
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EXHIBIT F |
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Form of Vessel Mortgage (Second) |
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SCHEDULE 1.1 |
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Permitted Liens |
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SCHEDULE 5.7 |
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Insurance |
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SCHEDULE 5.9 |
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Litigation |
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SCHEDULE 5.10 |
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Subsidiaries |
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SCHEDULE 5.11 |
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Real Property |
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SCHEDULE 5.12 |
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Equipment |
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SCHEDULE 5.13 |
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Vessels |
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SCHEDULE 6.4 |
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Insurers |
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SCHEDULE 6.12 |
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Existing Debt and Contingent Liabilities |
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SCHEDULE 6.15 |
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Investments |
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SCHEDULE 6.17 |
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Affiliate Transactions |
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THIRD AMENDED AND RESTATED
UNDERWRITING AND CONTINUING
INDEMNITY AGREEMENT
THIS THIRD AMENDED AND RESTATED UNDERWRITING AND CONTINUING INDEMNITY AGREEMENT (the Agreement ), made and entered into this 22nd day of December, 2003, is among (i) GREAT LAKES DREDGE & DOCK CORPORATION, a Delaware corporation ( HOLDINGS ), and the SUBSIDIARIES of HOLDINGS from time to time signatories hereto (collectively with HOLDINGS, the INDEMNITORS ), and (ii) TRAVELERS CASUALTY AND SURETY COMPANY, a Connecticut corporation (as assignee of Reliance Insurance Company, a Pennsylvania corporation, United Pacific Insurance Company, a Pennsylvania corporation, Reliance National Insurance Company, a Delaware corporation, and Reliance Surety Company, a Delaware corporation) ( TCASC ), and TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, a Connecticut corporation ( TRAVELERS AMERICA and together with TCASC, TRAVELERS ).
R E C I T A L S
WHEREAS, the PRINCIPALS are engaged in the business, among other things, of dredging, dredging reclamation, aggregate mining and supply, and marine construction in the United States and in other countries, and any PRINCIPAL, individually, jointly with others or on behalf of any of its SUBSIDIARIES, AFFILIATES or divisions or their SUBSIDIARIES, AFFILIATES or divisions now in existence or hereafter formed or acquired, or on behalf of third-party Persons, may desire or be required from time to time in connection with these businesses to deliver certain BOND(s) to OBLIGEES; and
WHEREAS, certain of the INDEMNITORS, the PRINCIPALS and TRAVELERS are parties to that certain Second Amended and Restated Underwriting and Continuing Indemnity Agreement (the SECOND AMENDMENT AND RESTATEMENT ) dated as of August 19, 1998, which amended and restated that certain First Amended and Restated Underwriting and Continuing Indemnity Agreement dated as of September 24, 1997 ( FIRST AMENDMENT AND RESTATEMENT ), which amended and restated that certain Amended Agreement dated as of October 15, 1991, among certain of the PRINCIPALS, certain AFFILIATES of the PRINCIPALS and TRAVELERS (as amended and restated by the FIRST AMENDMENT AND RESTATEMENT and the SECOND AMENDMENT AND RESTATEMENT, and as otherwise amended or modified, the EXISTING AGREEMENT ); and
WHEREAS, in accordance with the terms of the EXISTING AGREEMENT, TRAVELERS has heretofore executed or procured and, upon the express condition that this Agreement and the other UNDERWRITING DOCUMENTS be executed, TRAVELERS may continue to execute or procure the execution of BOND(s), and TRAVELERS may continue previously executed BOND(s) and may forbear cancellation of such BOND(s); and
WHEREAS, each of the INDEMNITORS recognizes that BONDS are a necessary and desirable adjunct to the businesses done and to be done by the PRINCIPALS and desires to accommodate the financial, security, indemnity, exoneration and other requirements of TRAVELERS as an inducement to TRAVELERS to become surety upon obligations of the
PRINCIPALS and has therefore agreed to be bound by this Agreement and the other UNDERWRITING DOCUMENTS to which it is a party and has agreed to exercise its best efforts to permit and require the PRINCIPALS to honor and perform all of the terms of this Agreement; and
WHEREAS, TRAVELERS has agreed to act as surety or procure surety BONDS for the PRINCIPALS, subject to the understanding of the parties that TRAVELERS is under no obligation to act as surety for every bond of the PRINCIPALS, that TRAVELERS shall have the right to refuse to execute BONDS for any reason, including, without limitation, with respect to CONTRACTS which in TRAVELERS sole judgment present risks not contemplated by this Agreement and that the PRINCIPALS are under no obligation to obtain BONDS from TRAVELERS; and
WHEREAS, the INDEMNITORS and the PRINCIPALS now desire to amend and restate the EXISTING AGREEMENT on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements set forth herein, the execution or procurement of any BOND(s) by TRAVELERS or the forbearance or cancellation of any existing BOND(s) by TRAVELERS and as an inducement to such execution, procurement or forbearance, we, the undersigned PRINCIPALS and INDEMNITORS, agree and bind ourselves, our successors and assigns, jointly and severally, as follows:
AFFILIATE means, with respect to any PERSON, any other PERSON or group acting in concert with such PERSON that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under the common control with such PERSON. For purposes of this definition, control (including, with correlative meanings, the terms controlled by and under common control with), as used with respect to any PERSON or group of PERSONS, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of such PERSON, whether through the ownership of voting securities or by contract or otherwise.
AUTHORIZED OFFICER means, with respect to any PERSON, the chief executive officer, president, chief financial officer, treasurer, assistant treasurer, controller or any vice president of such PERSON.
BANK LOAN FACILITY means that certain Credit Agreement dated as of December 22, 2003, by and among GLDD Acquisitions Corp., HOLDINGS, certain corporate affiliates thereof, the financial institutions from time to time parties thereto and Bank of America, N.A., as administrative agent to such financial institutions, and the documents, instruments and agreements executed and delivered in connection therewith, as all of the same may be amended, restated, supplemented or otherwise modified from time to time, and any credit agreement or
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other agreement or agreements relating to any refinancing, extension, renewal or replacement, in whole or in part, thereof.
BOND(s) means any surety agreements, undertakings, or instruments of guarantee signed by TRAVELERS on behalf of any PRINCIPAL, whether executed before or after the execution of this Agreement.
CONTINGENT LIABILITY means any agreement, undertaking or arrangement by which any Person guarantees, endorses or otherwise becomes or is contingently liable upon (by agreement, contingent, or otherwise, to provide funds for payment, to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the indebtedness, obligation or any other liability of any other Person (other than by endorsements of instruments in the course of collection), or guarantees the payment of dividends or other distributions upon the shares of any other PERSON.
CONTRACT(s) means any contract referred to or described in any BOND(s) issued on behalf of any PRINCIPAL.
DEBT means and includes, with respect to any PERSON, (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds (including, without limitation, license, bid, performance, lien or payment bonds), debentures, notes or other similar instruments, (iii) obligations which have been incurred in connection with the acquisition of property or services (including, without limitation, obligations to pay the deferred purchase price of property or services), excluding trade payables and accrued expenses incurred in the ordinary course of business, (iv) obligations secured by any LIEN or other charge upon property or assets owned by such PERSON, even though such PERSON has not assumed or become liable for the payment of such obligations, (v) obligations created or arising under any conditional sale or other title retention agreement with respect to property acquired by such PERSON, notwithstanding the fact that the rights and remedies of the seller, lender or lessor under such agreement in the event of default are limited to repossession or sale of property, (vi) the principal amount of any capital lease and (vii) reimbursement obligations with respect to letters of credit.
DEBT INDENTURE means that certain Indenture dated as of December 22, 2003, by and among HOLDINGS, certain of the SUBSIDIARIES of HOLDINGS, and The Bank of New York, as Trustee, governing the issuance by HOLDINGS of $175,000,000 in original principal amount of its 7 3/4% Senior Subordinated Notes due 2013, as amended, restated, supplemented, modified, refunded, refinanced or replaced, in whole or in part, from time to time in accordance with Section 6.21 .
ENVIRONMENTAL LAWS means all international, foreign, federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative or judicial orders, licenses, authorizations and permits of, and agreements with, any governmental authorities, in each case relating to environmental, health, safety and land use and natural resource matters now or hereafter in effect; including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Clean Air Act, the Federal Water Pollution Control Act of 1972, the Solid Waste Disposal Act, as amended, the Resource Conservation and Recovery Act, the Toxic Substance Control Act, and
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the Emergency Planning and Community Right-to-Know Act, and the Occupational Safety and Health Act, and any analogous state or local laws.
ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations and published interpretations thereof.
EVENT OF DEFAULT means any one or more of the following:
or
or
or
or
(e) an OBLIGEE has declared by delivery of written notice to any PRINCIPAL that such PRINCIPAL is in default of any provision under the respective CONTRACT(s) between such PRINCIPAL and such OBLIGEE and such PRINCIPAL has failed to cure such default within that period of time provided to cure said default within such CONTRACT(s) in which such PRINCIPAL is alleged to be in default and such default results in any OBLIGEE making demand for payment or performance under any BOND provided in connection with such CONTRACT; provided , that TRAVELERS shall, upon investigation, reasonably determine in good faith that PRINCIPAL is in default under the CONTRACT(s) or such PRINCIPAL has acknowledged its default under the CONTRACT(s),
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irrespective of whether or not such PRINCIPAL is actually in default of the CONTRACT(s) (such a determination by TRAVELERS shall not be binding upon such PRINCIPAL in any dispute such PRINCIPAL may have with such OBLIGEE or a claimant under the related BOND(s); except as provided above, it shall be no defense to the enforcement of this Agreement by TRAVELERS, and co-sureties, if any, that PRINCIPAL asserts that it is not in default under the CONTRACT(s));
or
(f) TRAVELERS has received notice or knowledge of facts giving rise to a reasonable good faith belief that it has incurred or may incur a LOSS and a PRINCIPAL has failed to cure such LOSS or to take reasonable steps to avoid the incurrence by TRAVELERS of such LOSS within thirty (30) days after receipt of written notice sent by TRAVELERS to such PRINCIPAL; provided , that no EVENT OF DEFAULT under this clause (f) shall occur if prior to the expiration of such thirty-day period such PRINCIPAL causes (1) a letter of credit with a face amount equal to such LOSS and otherwise in form and substance reasonably acceptable to TRAVELERS to be issued and delivered to TRAVELERS or (2) cash collateral in an amount equal to such LOSS to be pledged to TRAVELERS pursuant to documentation reasonably acceptable to TRAVELERS; provided further , that the providing of such letter of credit or cash collateral shall not obligate TRAVELERS to deny any claim related to such LOSS unless TRAVELERS has determined that a meritorious defense exists to such claim;
or
(g) Any PRINCIPAL within fifteen (15) days after receipt of notice sent by TRAVELERS to such PRINCIPAL has failed, refused or delayed to pay or is unable to pay any claims, bills or other indebtedness incurred in, or in connection with, the performance of the CONTRACT(s) which claims, bills or other indebtedness TRAVELERS, upon investigation, shall have reasonably determined in good faith to be valid;
or
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or
or
EXISTING AGREEMENT has the meaning set forth in the recitals to this Agreement.
FINANCIAL STATEMENTS means all those balance sheets, income statements and other financial statements of any INDEMNITOR or any AFFILIATE thereof which have been furnished to TRAVELERS for the purpose of or in connection with this Agreement and the transactions contemplated hereby.
GAAP is defined as generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board.
GLDDC means Great Lakes Dredge & Dock Company, a New Jersey corporation.
HOLDINGS has the meaning set forth in the recitals to this Agreement.
INDEMNITOR means any of HOLDINGS or any SUBSIDIARY of HOLDINGS which is a party to this Agreement as of the date hereof or which becomes a party to this Agreement after the date hereof by hereafter executing and delivering to TRAVELERS a SUPPLEMENTAL SIGNATURE PAGE and INDEMNITORS means, collectively, all of HOLDINGS and all such SUBSIDIARIES of HOLDINGS.
INTERCREDITOR AGREEMENT means that certain Intercreditor Agreement dated as of December 22, 2003, by and among GLDD Acquisitions Corp., HOLDINGS, certain
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SUBSIDIARIES of HOLDINGS, Bank of America, N.A., as administrative agent, and TRAVELERS, and the documents, instruments and agreements executed and delivered pursuant thereto, as all of the same may be amended, restated, supplemented or otherwise modified from time to time, and any other intercreditor agreement in replacement thereof which is in form and substance acceptable to TRAVELERS.
LIEN means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement to assure payment of DEBT, encumbrance, lien (statutory or other), charge, or encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing).
LIMITED SUBSIDIARY means (a) any SUBSIDIARY which is not an INDEMNITOR and (b) any INDEMNITOR which is not a wholly-owned SUBSIDIARY of HOLDINGS; provided , that North American Site Developers, Inc. shall not be deemed to be a LIMITED SUBSIDIARY for purposes of this Agreement.
LOSS means:
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LYDON means Lydon Dredging & Construction Company, Ltd., a Canadian corporation.
MATERIAL ADVERSE CHANGE means a material adverse change in the condition (financial or otherwise), business, operations or prospects of HOLDINGS and its SUBSIDIARIES, taken as a whole.
MERGER AGREEMENT means that certain Amended and Restated Agreement and Plan of Merger, dated as of December 22, 2003, among GLDD Acquisitions Corp., a Delaware corporation (Parent ), GLDD Merger Sub, Inc., a Delaware corporation and a direct wholly-owned subsidiary of Parent, HOLDINGS and, solely in its capacity as Stockholder Representative thereunder and for purposes of Sections 2.8, 2.9, Article VIII and Article IX thereof, Vectura Holding Company LLC.
NET INCOME means, for any period, the aggregate of all amounts (exclusive of all amounts in respect of any extraordinary or non-recurring gain or loss (including, without limitation, any write-off of the Chicago Flood litigation insurance receivable)) which, in accordance with GAAP, would be included as net income on a consolidated statement of income of HOLDINGS and its SUBSIDIARIES for such period.
OBLIGEE means any named party or parties appearing on the BOND(s) in whose favor the BOND(s) are issued.
PAYMENT BLOCKAGE NOTICE has the meaning assigned thereto in the DEBT INDENTURE.
PERMITTED LIENS means:
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PERSON means any entity, whether an individual, trustee, corporation, partnership, joint stock company, limited liability company, unincorporated organization, business association or firm, joint venture, a government or any agent or instrumentality or political subdivision thereof.
PLAN means any employee benefit plan (as defined in Section 3(3) of ERISA) established, maintained or to which contributions have been made by any PRINCIPAL.
PLEDGE AGREEMENT means a Note Pledge Agreement substantially in the form of Exhibit B hereto, executed by certain of the INDEMNITORS in favor of TRAVELERS, as the same may be amended, restated, supplemented or otherwise modified from time to time.
PRINCIPAL means any of HOLDINGS, GLDDC, LYDON, and any other INDEMNITOR for whom TRAVELERS has executed a BOND; and PRINCIPALS means collectively all of the foregoing PERSONS.
TRAVELERS has the meaning set forth in the recitals to this Agreement.
RESTRICTED AMOUNTS means, as of any date, each of the following: (a) all DEBT and CONTINGENT LIABILITIES of the type described in clause (j) of Section 6.12 outstanding on such date, (b) the fair market value of all assets sold from the date hereof through such date pursuant to the terms of clause (a)(iv)(B) of Section 6.13 , and (c) investments of the type described in clause (e) of Section 6.15 outstanding on such date.
SECURITY AGREEMENTS means, collectively, the SECURITY AGREEMENT (A/R) and each SECURITY AGREEMENT (EQUIPMENT).
SECURITY AGREEMENT (A/R) means a Security Agreement (A/R) substantially in the form of Exhibit C hereto, executed by the PRINCIPALS (other than LYDON) in favor of TRAVELERS, as the same may be amended, restated, supplemented or otherwise modified from time to time.
SECURITY AGREEMENT (EQUIPMENT) means each of the Security Agreement (Equipment) substantially in the form of Exhibit D hereto, executed and delivered by each of GLDDC and HOLDINGS (or any other INDEMNITOR which executes a VESSEL
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MORTGAGE after the date hereof) in favor of TRAVELERS, as the same may be amended, restated, supplemented or otherwise modified from time to time.
SUBORDINATED DEBT means all DEBT of HOLDINGS issued pursuant to the DEBT INDENTURE.
SUBSIDIARY of a PERSON means any corporation, association, partnership, limited liability company, joint venture or other business entity of which more than 50% of the voting stock or other equity interests, is owned or controlled directly or indirectly by such PERSON, or one or more of the SUBSIDIARIES of such PERSON, or a combination thereof. Unless the context otherwise clearly requires, references herein to a SUBSIDIARY refer to a SUBSIDIARY of HOLDINGS.
SUPPLEMENTAL SIGNATURE PAGE means a supplemental signature page to this Agreement in the form of Exhibit A hereto.
UNDERWRITING DOCUMENTS means this Agreement, each of the SECURITY AGREEMENTS, the PLEDGE AGREEMENT, the VESSEL MORTGAGES, each BOND and any other instrument, document or agreement delivered by any INDEMNITOR in connection herewith.
VESSEL FINANCING AGREEMENT means that certain Credit Agreement, dated as of December 17, 2003, by and between GLDDC and General Electric Capital Corporation, and the documents, instruments and agreements executed and delivered pursuant thereto, as all of the same may be amended, restated, supplemented or otherwise modified from time to time, and any credit agreement or other agreement or agreements relating to any refinancing, extension, renewal or replacement, in whole or in part, from time to time thereof.
VESSEL FINANCING COLLATERAL means, collectively, (i) the Vessels Florida (Official No. 506446), Key West (Official No. 684596) and GL 184 (Official No. 652202), (ii) all insurance and requisition compensation relating to such vessels and any proceeds thereof, and (iii) all charters (other than charters entered into in connection with work being performed on a bonded project) entered into with respect to such vessels having a duration of nine months or more, and the right to receive payments of all sums thereunder.
VESSEL MORTGAGES means, collectively, (i) the First Preferred Fleet Mortgage substantially in the form of Exhibit E hereto, executed by GLDDC in favor of TRAVELERS, (ii) the Second Preferred Fleet Mortgage substantially in the form of Exhibit F hereto, executed by GLDDC in favor of TRAVELERS, (iii) the First Preferred Fleet Mortgage substantially in the form of Exhibit E hereto, executed by HOLDINGS in favor of TRAVELERS, (iv) the Second Preferred Fleet Mortgage substantially in the form of Exhibit F hereto, executed by HOLDINGS in favor of TRAVELERS, and (v) any other fleet mortgages or vessel mortgages at any time hereafter executed and delivered by any INDEMNITOR in connection with this Agreement and the other UNDERWRITING DOCUMENTS; in each case as any of the foregoing documents may be amended, restated, supplemented or otherwise modified from time to time.
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Any defined term used in the singular preceded by any shall be taken to indicate any number of the members of the relevant class. A reference to any PERSON shall include all predecessors in interest of such PERSON and any successors or assigns of such PERSON, including successors by way of merger, acquisition or similar event. Any defined term used in the singular and preceded by the word each shall indicate all members of the relevant class, individually. A Section or an Exhibit or a Schedule is, unless otherwise stated, a reference to a section hereof or an exhibit or a schedule hereto, as the case may be. The words hereof, herein, hereto and hereunder and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.
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INDEMNITORS of written demand therefor. Notwithstanding anything to the contrary herein, any INDEMNITOR which is not a wholly-owned SUBSIDIARY of HOLDINGS (other than North American Site Developers, Inc.) shall indemnify and hold and save TRAVELERS harmless only as to any LOSS incurred by or on behalf of such INDEMNITOR.
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TRAVELERS any claim or right to payment that such INDEMNITOR may have or hereafter have or acquire against any PRINCIPAL or other INDEMNITOR by subrogation, indemnification, contribution or otherwise.
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claim against TRAVELERS for any oral representations, promises or statements made to any of them by TRAVELERS or any of its agents or brokers, or for the failure of TRAVELERS to disclose facts or information to INDEMNITORS.
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opinion of TRAVELERS desirable to perfect the security interest created by such SECURITY AGREEMENT (EQUIPMENT);
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The PRINCIPALS represent and warrant to TRAVELERS that
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failure to so qualify could not reasonably be expected to name a MATERIAL ADVERSE CHANGE.
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penalties, except to the extent the validity thereof is being contested in good faith by appropriate proceedings and for which adequate reserves have been set aside on its books in accordance with GAAP.
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So long as any BONDS shall remain outstanding, HOLDINGS hereby covenants and agrees with TRAVELERS as follows:
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interpreted to require the payment of any tax, assessment or charge so long as its validity is being contested in good faith by appropriate proceedings and for which adequate reserves have been set aside on its books in accordance with GAAP.
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its SUBSIDIARIES involving an amount in excess of $6,000,000 which claim is not covered by insurance and (b) all litigation filed against any INDEMNITOR associated with any CONTRACT with respect to which five or more separate litigation matters are then pending.
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For purposes of this Section 6.15 , Cash Equivalent Investments means, at any item:
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Notwithstanding the foregoing, HOLDINGS may consummate the transactions contemplated by the MERGER AGREEMENT.
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out of pocket costs and expenses owed to PERSONS who are not AFFILIATES, (c) transactions contemplated by the MERGER AGREEMENT, (d) any tax sharing agreement entered into by HOLDINGS or any of its SUBSIDIARIES from time to time, (e) any customary management agreement entered into by HOLDINGS or its SUBSIDIARIES with Madison Dearborn Partners IV, L.P. or any of its AFFILIATES from time to time and (f) the transactions described on Schedule 6.17 .
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SUBORDINATED DEBT, except to the extent that such amendment, supplement or other modification would extend the date or reduce the amount of any required repayment or redemption or would amend, supplement or modify any term or provision in a manner not adverse to the rights or interests of TRAVELERS. Notwithstanding the foregoing, (i) TRAVELERS hereby consents to HOLDINGS making a voluntary prepayment of, redeeming or repurchasing all of the principal and accrued and unpaid interest, together with any premium and fees in connection with such prepayment, redemption or repurchase, on the senior subordinated notes issued pursuant to the 1998 DEBT INDENTURE (as defined in the EXISTING AGREEMENT) and (ii) HOLDINGS and its SUBSIDIARIES shall be permitted to refinance the SUBORDINATED DEBT from time to time pursuant to a note indenture or other agreement containing covenants, events of default and other terms not materially more restrictive than those set forth in the DEBT INDENTURE.
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Agreement, INDEMNITORS recognize that the appointment of such attorney-in-fact constitutes a power coupled with an interest.
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TRAVELERS may or does substantially increase the liability of the INDEMNITORS and the PRINCIPALS; or (b) to take such steps as it may deem necessary or proper to obtain release from liability under the BOND(s); or (c) to assent to any changes in any CONTRACT, including but not limited to, any change in the time for completion of any CONTRACT and to payments or advances thereunder.
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Notice to TRAVELERS shall be sent to:
Travelers Casualty and Insurance Company of America
One Tower Square, 5PB
Hartford, CT 06183
Attention: Chief Underwriting Officer - National Account Unit
with a copy to:
Travelers Casualty and
Surety Company
215 Shuman Boulevard
Naperville, IL 60563-8458
Attention: Construction Services - Bond
Notice to any PRINCIPAL or to any INDEMNITOR shall be sent to:
Great Lakes Dredge &
Dock Corporation
2122 York Road
Oak Brook, IL 60523
Attention: Deborah A. Wensel
Chief Financial Officer
With a copy to:
Winston & Strawn LLP
35 W. Wacker Drive
Chicago, Illinois 60601
Attention: Brian S. Hart, Esq.
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deemed to constitute a payment, settlement or novation of the DEBT evidenced by the EXISTING AGREEMENT, or to release or otherwise adversely affect any LIEN securing such DEBT or any rights TRAVELERS has against any guarantor, surety or other party primarily or secondarily liable for such DEBT.
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IN WITNESS WHEREOF, this Agreement is executed by the parties on the day and date first set forth above.
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GREAT LAKES
DREDGE & DOCK
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/s/ Deborah A. Wensel / |
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Deborah A. Wensel |
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Title: |
Senior Vice President, Chief Financial |
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Officer and Treasurer |
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GREAT LAKES DREDGE & DOCK COMPANY |
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/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Senior Vice President, Chief Financial |
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Officer and Treasurer |
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LYDON DREDGING
& CONSTRUCTION
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By: |
/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Vice President |
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FIFTY-THREE DREDGING CORPORATION |
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/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Vice President |
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DAWSON MARINE SERVICES COMPANY |
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/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Senior Vice President, Chief Financial |
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Officer and Treasurer |
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GREAT LAKES CARIBBEAN DREDGING, INC. |
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By: |
/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Senior Vice President, Chief Financial |
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Officer and Treasurer |
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NORTH AMERICAN SITE DEVELOPERS, INC. |
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/s/ Deborah A. Wensel / |
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Name: |
Deborah A. Wensel |
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Title: |
Vice President and Treasurer |
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TRAVELERS
CASUALTY AND SURETY
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/s/ Michael Damewood |
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Michael Damewood |
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Attorney-in-Fact |
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TRAVELERS
CASUALTY AND SURETY
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By: |
/s/ Michael Damewood |
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Name: |
Michael Damewood |
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Title: |
Attorney-in-Fact |
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