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EXHIBIT 4.J
CREDIT AGREEMENT
DATED AS OF JULY 1, 1997
AMONG
TRUSERV CORPORATION,
VARIOUS FINANCIAL INSTITUTIONS,
AND
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
AS AGENT
ARRANGED BY BA SECURITIES, INC.
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Section Page
TABLE OF CONTENTS
Section Page
ARTICLE I DEFINITIONS
1.1 Certain Defined Terms 1
1.2 Other Interpretive Provisions 20
1.3 Accounting Principles 21
1.4 Currency Equivalents Generally 21
1.5 Introduction of Euro 21
ARTICLE II THE CREDITS
2.1 Amounts and Terms of Commitments 22
2.2 Loan Accounts 22
2.3 Procedure for Committed Borrowing 23
2.4 Conversion and Continuation Elections for Committed
Borrowings 24
2.5 Utilization of Commitments in Offshore Currencies 26
2.6 Bid Borrowings 27
2.7 Procedure for Bid Borrowings 28
2.8 Voluntary Termination or Reduction of Commitments 31
2.9 Optional Prepayments 31
2.10 Currency Exchange Fluctuations 32
2.11 Repayment. 32
2.12 Interest 32
2.13 Fees 33
(a) Certain Fees 33
(b) Facility Fees 33
(c) Commitment Fees 34
2.14 Computation of Fees and Interest 34
2.15 Payments by the Company 35
2.16 Payments by the Lenders to the Agent 35
2.17 Sharing of Payments, Etc. 36
2.18 Swing Line Commitment 38
2.19 Borrowing Procedures for Swing Line Loans 38
2.20 Prepayment or Refunding of Swing Line Loans 39
2.21 Participations in Swing Line Loans 39
2.22 Participation Obligations Unconditional 40
2.23 Conditions to Swing Line Loans 40
2.24 BA Subfacility 41
(a) Creation 41
(b) Notice 41
(c) Issuance Fee 41
(d) Payment 42
(e) Participations in BAs 42
(f) Limitation of Liability 43
2.25 Extension of Scheduled Termination Date 43
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Section Page
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 Taxes 44
3.2 Illegality 45
3.3 Increased Costs and Reduction of Return 46
3.4 Funding Losses 47
3.5 Inability to Determine Rates 48
3.6 Reserves on Offshore Rate Loans 48
3.7 Certificates of Lenders 49
3.8 Substitution of Lenders 49
3.9 Survival 49
ARTICLE IV CONDITIONS PRECEDENT
4.1 Conditions to Initial Credit Extensions 49
(a) Credit Agreement and Notes 50
(b) Resolutions; Incumbency; Certificate of
Incorporation; By-Laws 50
(c) Good Standing 50
(d) Legal Opinion 50
(e) Payment of Fees 50
(f) Certificate 50
(g) Other Documents 51
4.2 Conditions to All Credit Extensions 51
(a) Notice 51
(b) Continuation of Representations and Warranties 51
(c) No Existing Default 51
ARTICLE V REPRESENTATIONS AND WARRANTIES
5.1 Organization; Subsidiary Preferred Stock 52
5.2 Financial Statements 52
5.3 Actions Pending 53
5.4 Outstanding Debt 53
5.5 Title to Properties 53
5.6 Taxes 53
5.7 Conflicting Agreements and Other Matters 54
5.8 Use of Proceeds 54
5.9 ERISA 55
5.10 Governmental Consent 55
5.11 Environmental Compliance 56
5.12 Disclosure 56
5.13 Hostile Tender Offers 56
5.14 Priority of Obligations 56
5.15 Merger, etc 56
ARTICLE VI AFFIRMATIVE COVENANTS
6.1 Financial Statements 57
6.2 Certificates; Other Information 57
6.3 Notices 58
6.4 Preservation of Corporate Existence, Etc 59
6.5 Maintenance of Property 60
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Section Page
6.6 Insurance 60
6.7 Payment of Obligations 60
6.8 Compliance with Laws 60
6.9 Compliance with ERISA 61
6.10 Inspection of Property and Books and Records 61
6.11 Environmental Laws 61
6.12 Use of Proceeds 61
6.13 Covenant to Secure Obligations Equally 61
6.14 Cooperative Status 62
ARTICLE VII NEGATIVE COVENANTS
7.1 Fixed Charge Coverage Ratio 62
7.2 Lien Restrictions 62
7.3 Debt Restrictions 63
7.4 Sale of Assets 64
7.5 Merger 64
7.6 Restrictions on Transactions with Affiliates and
Stockholders 64
7.7 Issuance of Stock by Subsidiaries 65
7.8 Compliance with ERISA 65
7.9 No Change in Subordination Terms, etc. 65
7.10 Nature of Business 66
7.11 Restricted Investments 66
7.12 Restricted Payments 66
7.13 Use of Proceeds 67
ARTICLE VIII EVENTS OF DEFAULT
8.1 Event of Default 67
8.2 Remedies 69
8.3 Rights Not Exclusive 70
ARTICLE IX THE AGENT
9.1 Appointment and Authorization;"Agent" 71
9.2 Delegation of Duties 71
9.3 Liability of Agent 72
9.4 Reliance by Agent 72
9.5 Notice of Default 73
9.6 Credit Decision 73
9.7 Indemnification of Agent 74
9.8 Agent in Individual Capacity 74
9.9 Successor Agent 75
9.10 Withholding Tax 75
9.11 Co-Agents 77
ARTICLE X MISCELLANEOUS
10.1 Amendments and Waivers 77
10.2 Notices 78
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Section Page
10.3 No Waiver; Cumulative Remedies 79
10.4 Costs and Expenses 79
10.5 Company Indemnification 80
10.6 Payments Set Aside 80
10.7 Successors and Assigns 81
10.8 Assignments, Participations, etc. 81
10.9 Confidentiality 82
10.10 Set-off 83
10.11 Automatic Debits of Fees 83
10.12 Notification of Addresses, Lending Offices, Etc. 84
10.13 Counterparts 84
10.14 Severability 84
10.15 No Third Parties Benefited 84
10.16 Governing Law and Jurisdiction 84
10.17 Waiver of Jury Trial 85
10.18 Judgment 85
10.19 Entire Agreement 86
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SCHEDULES
Schedule 1.1 Pricing Schedule
Schedule 2.1 Commitments and Pro Rata Shares
Schedule 5.7 Restrictive Agreements
Schedule 7.2 Liens
Schedule 7.11 Investments
Schedule 10.2 Offshore and Domestic Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Competitive Bid Request
Exhibit D Form of Competitive Bid
Exhibit E Form of Compliance Certificate
Exhibit F Form of Legal Opinion of Counsel to the Company
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Note
Exhibit I Form of Subordinated Note
Exhibit J Form of Request for Extension of Termination Date
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CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of July 1, 1997, among TRUSERV
CORPORATION, a Delaware corporation (the "Company"), the several financial
institutions from time to time party to this Agreement (collectively the
"Lenders"; individually each a "Lender"), and BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as Accepting Lender, Swing Line Lender and Agent.
WHEREAS, the Lenders have agreed to make available to the Company a
revolving multi-currency credit facility with swing line and bankers'
acceptance subfacilities, all on the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
I. ARTICLE
DEFINITIONS
A. Certain Defined Terms. The following terms have the following
meanings:
Absolute Rate - see subsection 2.7(b)(ii)(D).
Absolute Rate Auction means a solicitation of Competitive Bids
setting forth Absolute Rates pursuant to Section 2.7.
Absolute Rate Bid Loan means a Bid Loan that bears interest at a
rate determined with reference to the Absolute Rate.
Acceptance Documents means such documents and agreements as the
Accepting Lender may reasonably require in connection with any BA
hereunder.
Accepting Lender means BofA in its capacity as accepting lender
hereunder, together with any successor in such capacity.
Affiliate means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the
power to direct or cause the direction of the management and policies of
such other Person, whether through the ownership of voting securities,
membership interests, by contract, or otherwise.
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Agent means BofA in its capacity as agent for the Lenders hereunder,
and any successor agent arising under Section 9.9.
Agent-Related Persons means the Agent and any successor thereto in
such capacity hereunder, together with their respective Affiliates, and
the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.
Agent's Payment Office means (i) in respect of payments in Dollars,
the address for payments to the Agent set forth on Schedule 10.2 or such
other address as the Agent may from time to time specify in accordance
with Section 10.2 and (ii) in the case of payments in any Offshore
Currency, such address as the Agent may from time to time specify in
accordance with Section 10.2.
Agreed Alternative Currency - see subsection 2.5(e).
Agreement means this Credit Agreement.
Applicable Currency means, as to any particular payment or Loan,
Dollars or the Offshore Currency in which it is denominated or is
payable.
Applicable Margin means the percentage set forth under the heading
"Applicable Margin" on Schedule 1.1 opposite the applicable Fixed Charge
Coverage Ratio.
Arranger means BA Securities, Inc.
Assignee - see subsection 10.8(a).
Attorney Costs means and includes all fees and charges of any law
firm or other external counsel, and, without duplication, the allocated
cost of internal legal services and all disbursements of internal
counsel.
BA means a draft drawn by the Company on, and accepted and
discounted by, the Accepting Lender pursuant to Section 2.24 in the
standard form for bankers' acceptances used by the Accepting Lender.
BA Commission means the percentage set forth under the heading "BA
Commission" on Schedule 1.1 opposite the applicable Fixed Charge Coverage
Ratio.
BA Outstandings means at any time the sum of (a) the maximum
aggregate amount which is, or at any time thereafter may become, payable
by the Accepting Lender under all BAs which have been accepted plus (b)
the aggregate
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amount of all payments made by the Accepting Lender under BAs and not
previously reimbursed by the Company.
Bankruptcy Code means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101, et seq.).
Bankruptcy Law - see subsection 8.1(h).
Base Rate means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in
effect for such day as publicly announced from time to time by BofA in
San Francisco, California, as its "reference rate." (The "reference
rate" is a rate set by BofA based upon various factors including BofA's
costs and desired return, general economic conditions and other factors,
and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate.) Any change in the
reference rate announced by BofA shall take effect at the opening of
business on the day specified in the public announcement of such change.
Base Rate Committed Loan means a Committed Loan that bears interest
based on the Base Rate.
Bid Borrowing means a Borrowing hereunder consisting of one or more
Bid Loans made to the Company on the same day by one or more Lenders.
Bid Loan means a Loan in Dollars by a Lender to the Company under
Section 2.6, which may be a LIBOR Bid Loan or an Absolute Rate Bid Loan.
Bid Loan Lender means, in respect of any Bid Loan, the Lender making
such Bid Loan to the Company.
BofA means Bank of America National Trust and Savings Association, a
national banking association.
Borrowing means a borrowing hereunder consisting of Loans of the
same Type and in the same Applicable Currency made to the Company on the
same day by one or more Lenders under Article II, and, other than in the
case of Base Rate Committed Loans, having the same Interest Period. A
Borrowing may be a Bid Borrowing or a Committed Borrowing.
Borrowing Date means any date on which a Borrowing occurs under
Section 2.3, 2.7 or 2.18.
Business Day means any day other than a Saturday, Sunday or other
day on which commercial banks in New York City, Chicago or San Francisco
are authorized or required by law to close and (i) with respect to
disbursements and
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payments in Dollars relating to Offshore Rate Loans, a day on which
dealings are carried on in the applicable offshore Dollar interbank
market and (ii) with respect to disbursements and payments in and
calculations pertaining to any Offshore Currency, a day on which
commercial banks are open for foreign exchange business in London,
England, and on which dealings in the relevant Offshore Currency are
carried on in the applicable offshore foreign exchange interbank market
in which disbursement of or payment in such Offshore Currency will be
made or received hereunder.
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.
Capitalized Lease Obligation means any rental obligation which,
under GAAP, is or will be required to be capitalized on the books of the
Company or any Subsidiary, taken at the amount thereof accounted for as
indebtedness (net of interest expense).
Closing Date means the date on which all conditions precedent set
forth in Section 4.1 are satisfied or waived by all Lenders (or, in the
case of subsection 4.1(e), waived by the Person entitled to receive the
applicable payment).
Code means the Internal Revenue Code of 1986 and regulations
promulgated thereunder.
Commitment - see Section 2.1.
Commitment Fee Rate means the percentage set forth under the heading
"Commitment Fee Rate" on Schedule 1.1 opposite the applicable Fixed
Charge Coverage Ratio.
Committed Borrowing means a Borrowing hereunder consisting of
Committed Loans made by the Lenders ratably from time to time according
to their respective Unused Commitment Shares.
Committed Loan means a Loan by a Lender to the Company under Section
2.1, which may be an Offshore Rate Committed Loan or a Base Rate
Committed Loan (each a "Type" of Committed Loan).
Company - see the Preamble.
Competitive Bid means an offer by a Lender to make a Bid Loan in
accordance with Section 2.7.
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Competitive Bid Request - see subsection 2.7(a).
Compliance Certificate means a certificate substantially in the form
of Exhibit E.
Computation Date means any date on which the Agent determines the
Dollar Equivalent amount of any Offshore Currency Loans pursuant to
subsection 2.5(a).
Consolidated Capitalization means, as of the time of any
determination, the sum of (i) Consolidated Net Worth and (ii) Funded
Debt.
Consolidated Net Earnings means with respect to any period:
(i) consolidated gross revenues of the Company and its Subsidiaries,
minus
(ii) all operating and non-operating expenses of the Company and its
Subsidiaries including all charges of a proper character (including
current and deferred taxes on income, provision for taxes on unremitted
foreign earnings which are included in gross revenues, and current
additions to reserves),
but not including in gross revenues:
(a) any extraordinary gains or losses (net of expenses and
taxes applicable thereto) resulting from the sale, conversion or
other disposition of capital assets (i.e., assets other than current
assets);
(b) any gains resulting from the appraised write-up of assets;
(c) any equity of the Company or any Subsidiary in the
unremitted earnings of any corporation which is not a Subsidiary;
(d) any earnings of any Person acquired by the Company or any
Subsidiary through purchase, merger or consolidation or otherwise
for any year prior to the year of acquisition; or
(e) any deferred credit representing the excess of equity in
any Subsidiary at the date of acquisition over the cost of the
investment in such Subsidiary;
all determined in accordance with GAAP.
Consolidated Net Worth means, as of any date of determination, the
sum of (i) the par value (or value stated on the books of the Company) of
the capital
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stock of all classes of the Company, plus (or minus in the case of a
surplus deficit) (ii) the amount of the consolidated surplus, whether
capital or earned, of the Company and its Subsidiaries, all determined in
accordance with GAAP.
Contractual Obligation means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument,
document or agreement to which such Person is a party or by which it or
any of its property is bound.
Conversion/Continuation Date means any date on which, under Section
2.4, the Company (a) converts Committed Loans of one Type to another Type
or (b) continues as Committed Loans of the same Type, but with a new
Interest Period, Committed Loans having an Interest Period expiring on
such date.
Cost of Funds Rate means, for any day, the rate per annum quoted by
BofA as its costs for obtaining Federal Funds on such day. The Costs of
Funds Rate for any day which is not a Business Day shall be the Cost of
Funds Rate for the preceding Business Day.
▇▇▇▇▇▇ means ▇▇▇▇▇▇ & Company, a Delaware corporation.
Credit Extension means and includes (a) the making of any Loan
hereunder and (b) the acceptance of any BA hereunder.
Debt means Short Term Debt and Funded Debt.
Dollar Equivalent means, at any time, (a) as to any amount
denominated in Dollars, the amount thereof at such time, and (b) as to
any amount denominated in an Offshore Currency, the equivalent amount in
Dollars as determined by the Agent at such time on the basis of the Spot
Rate for the purchase of Dollars with such Offshore Currency on the most
recent Computation Date provided for in subsection 2.5(a) or such other
date as is specified herein.
Dollars, dollars and $ each mean lawful money of the United States.
Effective Date means the later to occur of the date on which the
Agent has received counterparts of this Agreement executed by the parties
hereto and July 1, 1997.
Eligible Assignee means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100,000,000; (b) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a combined capital
and surplus of at least $100,000,000,
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provided that such bank is acting through a branch or agency located in
the United States; and (c) a Person that is primarily engaged in the
business of commercial banking and that is (i) a Subsidiary of a Lender,
(ii) a Subsidiary of a Person of which a Lender is a Subsidiary, or (iii)
a Person of which a Lender is a Subsidiary.
Environmental Claims means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
Environmental Laws means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together
with all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental, health, safety and
land use matters.
ERISA means the Employee Retirement Income Security Act of 1974 and
regulations promulgated thereunder.
ERISA Affiliate means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the
Code for purposes of provisions relating to Section 412 of the Code).
ERISA Event means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which
it was a substantial employer (as defined in Section 4001(a)(2) of ERISA)
or a substantial cessation of operations which is treated as such a
withdrawal; (c) a complete or partial withdrawal by the Company or any
ERISA Affiliate from a Multiemployer Plan or notification that a
Multiemployer Plan is in reorganization; (d) the filing of a notice of
intent to terminate, the treatment of a Pension Plan amendment as a
termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer
Plan; (e) an event or condition which might reasonably be expected to
constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV
of ERISA, other than PBGC premiums due but not delinquent under Section
4007 of ERISA, upon the Company or any ERISA Affiliate.
Event of Default - see Section 8.1.
Exchange Act means the Securities Exchange Act of 1934 and
regulations promulgated thereunder.
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Existing Credit Agreement means each of (i) the Loan Agreement dated
as of February 1, 1991 among Servistar and NationsBank, N.A., as Agent,
and PNC Bank, N.A., as Co-Agent, and various additional banks and other
lending institutions, and (ii) the Credit Agreement dated as of March 29,
1996 among ▇▇▇▇▇▇, various financial institutions and Bank of America
Illinois, as Agent, in each case as amended prior to July 1, 1997.
Facility Fee Rate means the percentage set forth under the heading
"Facility Fee Rate" on Schedule 1.1 opposite the applicable Fixed Charge
Coverage Ratio.
Federal Funds Rate means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite
the caption "Federal Funds (Effective)"; or, if for any relevant day such
rate is not so published on any such preceding Business Day, the rate for
such day will be the arithmetic mean as determined by the Agent of the
rates for the last transaction in overnight Federal funds arranged prior
to 9:00 a.m. (New York City time) on that day by each of three leading
brokers of Federal funds transactions in New York City selected by the
Agent.
Fee Letter - see subsection 2.13(a).
Fixed Charge Coverage Ratio means, for any quarter, the ratio of
(a) the sum of (i) Consolidated Net Earnings, (ii) operating lease
expense, and (iii) interest expense,
to
(b) the sum of (i) operating lease expense and (ii) interest
expense;
each determined for the Company and its Subsidiaries on a consolidated
basis.
FRB means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
Funded Debt means and includes, (i) any obligation payable more than
one year from the date of creation thereof which under GAAP is shown on a
balance sheet as a liability (including Capitalized Lease Obligations and
notes payable to Members but excluding reserves for deferred income taxes
and other reserves to the extent that such reserves do not constitute an
obligation); (ii) indebtedness payable more than one year from the date
of creation thereof which is secured by any lien on property owned by the
Company or any Subsidiary; and
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(iii) Guarantees (excluding Guarantees of loans made to Members in an
amount not exceeding $10,000,000).
Further Taxes means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges (including net income taxes and franchise taxes), and all
liabilities with respect thereto, imposed by any jurisdiction on account
of amounts payable or paid pursuant to Section 3.1.
FX Trading Office means the Foreign Exchange Trading Center #5193,
San Francisco, California, of BofA, or such other office of BofA or any
of its Affiliates as BofA may designate from time to time.
GAAP means generally accepted accounting principles set forth from
time to time 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 (or agencies with similar functions of comparable stature
and authority within the U.S. accounting profession), which are
applicable to the circumstances as of the date of determination.
Governmental Authority means any nation or government, any state or
other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions
of or pertaining to government, and any corporation or other entity owned
or controlled, through stock or capital ownership or otherwise, by any of
the foregoing.
Guarantee means, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
indebtedness, lease, dividend or other obligation of another, including,
without limitation, any such obligation directly or indirectly
guaranteed, endorsed (other than for collection of deposit in the
ordinary course of business) or discounted or sold with recourse by such
Person, or in respect of which such Person is otherwise directly or
indirectly liable, including, without limitation, any such obligation in
effect guaranteed by such Person through any agreement (contingent or
otherwise) to purchase, repurchase or otherwise acquire such obligation
or any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances,
stock purchases, capital contributions or otherwise), or to maintain the
solvency or any balance sheet or other financial condition of the obligor
of such obligation, or to make payment for any products, materials or
supplies or for any transportation or services regardless of the
non-delivery or non-furnishing thereof, in any such case if the purpose
or intent of such agreement is to provide assurance that such obligation
will be paid or discharged, or that any agreements relating thereto will
be complied with, or that the holders of such
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obligation will be protected against loss in respect thereof. The
amount of any Guarantee shall be equal to the outstanding principal
amount of the obligation guaranteed or such lesser amount to which the
maximum exposure of the guarantor shall have been specifically limited.
Hostile Tender Offer means, with respect to the use of proceeds of
any Loan or BA, any offer to purchase, or any purchase of, shares of
capital stock of any corporation or equity interests in any other entity,
or securities convertible into or representing the beneficial ownership
of, or rights to acquire, any such shares or equity interests, if such
shares, equity interests, securities or rights are of a class which is
publicly traded on any securities exchange or in any over-the-counter
market, other than purchases of such shares, equity interests, securities
or rights representing less than 5% of the equity interests or beneficial
ownership of such corporation or other entity for portfolio investment
purposes, and such offer or purchase has not been duly approved by the
board of directors of such corporation or the equivalent governing body
of such other entity prior to the date on which the Company makes the
borrowing request for such Loan or the request for such BA.
Indebtedness means, with respect to any Person, without duplication,
(i) all items (excluding items of contingency reserves or of reserves for
deferred income taxes) which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance
sheet of such Person as of the date on which Indebtedness is to be
determined, (ii) all indebtedness secured by any Lien on any property or
asset owned or held by such Person subject thereto, whether or not the
indebtedness secured thereby shall have been assumed, and (iii) all
indebtedness of others with respect to which such Person has become
liable by way of Guarantee.
Indemnified Liabilities - see Section 10.5.
Indemnified Person - see Section 10.5.
Independent Auditor - see subsection 6.1(a).
Insolvency Proceeding means, with respect to any Person, (a) any
case, action or proceeding with respect to such Person before any court
or other Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief
of debtors, or (b) any general assignment for the benefit of creditors,
composition, marshalling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial
portion of its creditors; undertaken under U.S. Federal, state or foreign
law, including the Bankruptcy Code.
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Interest Payment Date means, as to any Loan other than a Base Rate
Committed Loan or a Swing Line Loan, the last day of each Interest Period
applicable to such Loan, (ii) as to any Base Rate Committed Loan, the
last Business Day of each calendar quarter, and (iii) as to any Swing
Line Loan, each Business Day (or as otherwise agreed between the Company
and the Swing Line Lender); provided that (a) if any Interest Period for
an Offshore Rate Committed Loan exceeds three months, the date that falls
three months after the beginning of such Interest Period shall also be an
Interest Payment Date and (b) as to any Bid Loan, such intervening dates
prior to the maturity thereof as may be specified by the Company and
agreed to by the applicable Bid Loan Lender in the applicable Competitive
Bid also shall be Interest Payment Dates.
Interest Period means, (a) as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or (in the case of any
Offshore Rate Committed Loan) on the Conversion/Continuation Date on
which the Loan is converted into or continued as an Offshore Rate
Committed Loan, and ending on the date one, two, three or six months
thereafter as selected by the Company in its Notice of Committed
Borrowing, Notice of Conversion/Continuation or Competitive Bid Request,
as the case may be; and (b) as to any Absolute Rate Bid Loan, a period of
not more than 180 days as selected by the Company in the applicable
Competitive Bid Request; provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, such Interest Period shall be extended to the
following Business Day unless, in the case of an Offshore Rate Loan,
the result of such extension would be to carry such Interest Period
into another calendar month, in which event such Interest Period
shall end on the preceding Business Day;
(ii) any Interest Period for an Offshore Rate Loan that begins
on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Business Day
of the calendar month at the end of such Interest Period; and
(iii) no Interest Period for any Loan shall extend beyond the
scheduled Termination Date.
Investments means any loan or advance to, or ownership, purchase or
acquisition of any security (including stock) or obligations of, or any
other interest in, or any capital contribution made to, any Person.
IRS means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
18
Lender - see the Preamble. References to the "Lenders" shall
include BofA in its capacity as Accepting Lender and as Swing Line
Lender.
Lending Office means, as to any Lender, the office or offices of
such Lender specified as its "Lending Office" or "Domestic Lending
Office" or "Offshore Lending Office", as the case may be, on Schedule
10.2, or such other office or offices as such Lender may from time to
time notify the Company and the Agent.
LIBOR Auction means a solicitation of Competitive Bids setting forth
a LIBOR Bid Margin pursuant to Section 2.7.
LIBOR Bid Loan means any Bid Loan that bears interest at a rate
based upon the Offshore Rate.
LIBOR Bid Margin - see subsection 2.7(c)(ii)(C).
Lien means any mortgage, pledge, security interest, encumbrance,
lien (statutory or otherwise) or charge of any kind (including any
agreement to give any of the foregoing, any conditional sale or other
title retention agreement, any lease in the nature thereof, and the
filing of or agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction) or any other type of preferential
arrangement for the purpose, or having the effect, of protecting a
creditor against loss or securing the payment or performance of an
obligation.
Loan means an extension of credit by a Lender to the Company under
Article II. A Loan may be a Committed Loan, a Bid Loan or a Swing Line
Loan.
Loan Documents means this Agreement, any Note, the Fee Letter and
all other documents delivered to the Agent or any Lender in connection
herewith.
Margin Stock means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of the Company or the
Company and its Subsidiaries taken as a whole; (b) a material impairment
of the ability of the Company or any Subsidiary to perform its
obligations under any Loan Document; or (c) a material adverse effect
upon the legality, validity, binding effect or enforceability against the
Company or any Subsidiary of any Loan Document.
Member means any Person which is a member of the Company.
19
Merger means the merger of Servistar with and into ▇▇▇▇▇▇ pursuant
to the Merger Agreement.
Merger Agreement means the Agreement and Plan of Merger, dated as of
December 9, 1996 between ▇▇▇▇▇▇ and Servistar.
Minimum Tranche means, in respect of Loans comprising part of the
same Borrowing, or to be converted or continued under Section 2.4, (a) in
the case of Base Rate Committed Loans, $1,000,000 or a higher integral
multiple thereof and (b) in the case of Offshore Rate Committed Loans, a
minimum Dollar Equivalent amount of $5,000,000 and an integral multiple
of 1,000,000 units of the Applicable Currency.
Multiemployer Plan means any Plan which is a "multiemployer plan"
(as such term is defined in section 4001(a)(3) of ERISA).
Note means a promissory note executed by the Company in favor of a
Lender pursuant to subsection 2.2(b), in substantially the form of
Exhibit H.
Notice of Borrowing means a notice in substantially the form of
Exhibit A.
Notice of Committed Borrowing means a Notice of Borrowing requesting
Committed Loans pursuant to Section 2.3.
Notice of Conversion/Continuation means a notice in substantially
the form of Exhibit B.
Obligations means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
to any Lender, the Agent or any Indemnified Person, whether direct or
indirect (including those acquired by assignment), absolute or
contingent, due or to become due, or now existing or hereafter arising.
Offshore Currency means at any time Canadian dollars, English pounds
sterling, French francs, Deutschemarks, Japanese yen, and any Agreed
Alternative Currency.
Offshore Currency Loan means any Offshore Rate Committed Loan
denominated in an Offshore Currency.
Offshore Rate means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum determined by the Agent as the average (rounded
upwards, if necessary, to the nearest 0.01%) of the rates at which
deposits in the Applicable Currency in the approximate amount of the
Offshore Rate Loan of each Reference Lender (or, in
20
the case of a Bid Borrowing in which no Reference Lender is
participating, in the approximate amount of the largest Loan included in
such Borrowing) for such Interest Period would be offered by such
Reference Lender to major banks in the offshore interbank market at their
request at approximately 11:00 a.m. (New York City time) two Business
Days prior to the commencement of such Interest Period.
Offshore Rate Committed Loan means a Committed Loan that bears
interest based on the Offshore Rate. An Offshore Rate Committed Loan may
be an Offshore Currency Loan or a Loan denominated in Dollars.
Offshore Rate Loan means an Offshore Rate Committed Loan or a LIBOR
Bid Loan.
Organization Documents means, for any corporation, the certificate
or articles of incorporation, the bylaws, any certificate of
determination or instrument relating to the rights of preferred
shareholders of such corporation, any shareholder rights agreement, and
all applicable resolutions of the board of directors (or any committee
thereof) of such corporation.
Other Taxes means any present or future stamp, court 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, performance, enforcement or registration of, or otherwise with
respect to, this Agreement or any other Loan Document.
Overnight Rate means, for any day, the rate of interest per annum at
which overnight deposits in the Applicable Currency, in an amount
approximately equal to the amount with respect to which such rate is
being determined, would be offered for such day by BofA's London Branch
to major banks in the London or other applicable offshore interbank
market. The Overnight Rate for any day which is not a Business Day shall
be the Overnight Rate for the preceding Business Day.
Participant - see subsection 10.8(c).
Payment Sharing Notice means a written notice from the Company or
any Lender informing the Agent that an Event of Default has occurred and
is continuing and directing the Agent to allocate payments received from
the Company in accordance with subsection 2.17(b).
PBGC means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
21
Pension Plan means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA with respect to which the Company or
any ERISA Affiliate may have any liability.
Person means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
Plan shall mean any employee pension benefit plan (as such term is
defined in section 3 of ERISA) which is or has been established or
maintained, or to which contributions are or have been made, by the
Company or any ERISA Affiliate.
Preferred Stock, as applied to any corporation, means shares of such
corporation that shall be entitled to preference or priority over any
other shares of such corporation in respect of either the payment of
dividends or the distribution of assets upon liquidation, or both.
Pro Rata Share means, as to any Lender at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place)
at such time of such Lender's Commitment divided by the combined
Commitments of all Lenders (or, after the Commitments have terminated, of
(i) the Dollar Equivalent amount of such Lender's Loans plus (without
duplication) the participation of such Lender in (or, in the case of the
Accepting Lender or the Swing Line Lender, its unparticipated portion of)
all BA Outstandings and Swing Line Loans divided by (ii) the Dollar
Equivalent amount of all outstanding Loans plus all BA Outstandings).
Prudential Agreement means the Private Shelf Agreement dated as of
December 29, 1995 between the Company and The Prudential Insurance
Company of America and certain of its Affiliates.
Reference Lender means each of BofA, Bank of Montreal and PNC Bank,
National Association.
Replacement Lender - see Section 3.7.
Reportable Event means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such event
for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
Required Lenders means Lenders having Pro Rata Shares of 66-2/3% or
more.
22
Requirement of Law means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or
of a Governmental Authority, in each case applicable to or binding upon
the Person or any of its property or to which the Person or any of its
property is subject.
Responsible Officer means the chief executive officer, chief
operating officer, chief financial officer, treasurer or chief accounting
officer of the Company, general counsel of the Company or any other
officer of the Company involved principally in its financial
administration or its controllership function.
Restricted Investments shall mean any Investment prohibited by
Section 7.11.
Restricted Payment - see Section 7.12.
Same Day Funds means (i) with respect to disbursements and payments
in Dollars, immediately available funds, and (ii) with respect to
disbursements and payments in an Offshore Currency, same day or other
funds as may be determined by the Agent to be customary in the place of
disbursement or payment for the settlement of international banking
transactions in the relevant Offshore Currency.
SEC means the Securities and Exchange Commission or any Governmental
Authority succeeding to any of its principal functions.
Secured Funded Debt means Funded Debt which is secured by any Lien.
Senior Funded Debt means Funded Debt of the Company which is not
Subordinated Debt.
Servistar means Servistar COAST TO COAST Corporation, a Pennsylvania
corporation.
Short Term Debt means, as of any date of determination with respect
to any Person, (i) all Indebtedness of such Person for borrowed money
other than Funded Debt of such Person and (ii) Guarantees by such Person
of Short Term Debt of Persons other than Members.
Spot Rate for a currency means the rate quoted by BofA as the spot
rate for the purchase by BofA of such currency with another currency
through its FX Trading Office at approximately 8:00 a.m. (San Francisco
time) on the date two Business Days prior to the date as of which the
foreign exchange computation is made.
Subordinated Debt shall mean any Indebtedness of the Company which
contains terms of subordination identical to or, in the reasonable
determination of the Agent no less favorable to the Lenders than, the
terms of subordination set
23
forth in Exhibit I hereto and, which by virtue of such language and any
necessary action of the Board of Directors of the Company, is
subordinated to the Obligations.
Subsidiary means any corporation all of the stock of every class of
which, except directors' qualifying shares, shall, at the time as of
which any determination is being made, be owned by the Company either
directly or through Subsidiaries. Notwithstanding the foregoing, for
purposes of calculating the financial covenants, ▇▇▇▇▇▇ Canada Hardware
and Variety Cooperative, Inc. will be deemed a Subsidiary of the Company
if, in accordance with GAAP, it is consolidated in the financial
statements of the Company required to be delivered pursuant to clauses
(a) and (b) of Section 6.1 hereof.
Substantial Stockholder means (i) any Person owning, beneficially or
of record, directly or indirectly, either individually or together with
all other Persons to whom such Person is related by blood, adoption or
marriage, stock of the Company (of any class having ordinary voting power
for the election of directors) aggregating five percent (5%) or more of
such voting power or (ii) any Person related by blood, adoption or
marriage to any Person described or coming within the provisions of
clause (i) of this definition.
Swing Line Commitment means the commitment of the Swing Line Lender
to make Swing Line Loans hereunder. The Swing Line Commitment is a
subfacility under the combined Commitments and not a separate,
independent commitment.
Swing Line Lender means BofA in its capacity as swing line lender
hereunder, together with any successor thereto in such capacity.
Swing Line Loan - see Section 2.18.
Taxes means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, charges or withholdings, fees,
withholdings or similar charges, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, such taxes
(including income taxes or franchise taxes) as are taxes imposed on or
measured by its net income by the jurisdiction (or any political
subdivision thereof) under the laws of which such Lender or the Agent, as
the case may be, is organized or maintains a lending office.
Termination Date means the earlier to occur of:
(a) June 30, 2002, as such date may be extended pursuant to
Section 2.25; and
24
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
Total Outstandings means at any time the sum of (a) the Dollar
Equivalent principal amount of all outstanding Loans (whether Committed
Loans, Bid Loans or Swing Line Loans) plus (b) BA Outstandings.
Type has the meaning specified in the definition of "Committed
Loan."
Unfunded Pension Liability means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Plan's assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year.
United States and U.S. each means the United States of America.
Unmatured Event of Default means any event or circumstance which,
with the giving of notice, the lapse of time, or both, would (if not
cured or otherwise remedied during such time) constitute an Event of
Default.
Unused Commitment Share means, for any Lender at any time, a
fraction (a) the numerator of which is the remainder of (i) the
Commitment of such Lender minus (ii) the sum of (x) the aggregate Dollar
Equivalent principal amount of all then outstanding Loans of such Lender
(excluding, in the case of the Swing Line Lender, all Swing Line Loans)
and (b) the denominator of which is the remainder of (i) the aggregate
Commitments of all Lenders, minus (ii) the aggregate Dollar Equivalent
principal amount of all then outstanding Loans of all Lenders. Solely
for purposes of the foregoing, (i) Loans to be repaid with the proceeds
of Loans proposed to be made shall be deemed not to be outstanding; and
(ii) funded participations in Swing Line Loans pursuant to Section 2.21
and in obligations with respect to BAs pursuant to subsection 2.24(e)
shall be deemed to constitute Loans (but unfunded participations of the
types described above shall not constitute Loans).
A. Other Interpretive Provisions.
1. The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
1. The words "hereof", "herein", "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of
this Agreement; and subsection, Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.
25
a) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
a) The term "including" is not limiting and means "including
without limitation."
a) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding", and
the word "through" means "to and including."
1. Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto, but only to the extent such amendments and other modifications are not
prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation.
1. The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.
1. This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms. Unless otherwise expressly
provided herein, any reference to any action of the Agent, the Lenders or the
Required Lenders by way of consent, approval or waiver shall be deemed modified
by the phrase "in its/their sole discretion."
1. This Agreement and the other Loan Documents are the result
of negotiations among and have been reviewed by counsel to the Agent, the
Company and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Lenders or the Agent
merely because of the Agent's or Lenders' involvement in their preparation.
A. Accounting Principles.
1. Unless the context otherwise clearly requires, all
accounting terms not expressly defined herein shall be construed, and all
financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied; provided that if the Company
notifies the Agent that the Company wishes to amend any covenant in Article VII
to eliminate the effect of any change in GAAP on the operation of such covenant
(or if the Agent notifies the Company that the
26
Required Lenders wish to amend Article VII for such purpose), then the
Company's compliance with such covenant shall be determined on the basis of
GAAP in effect immediately before the relevant change in GAAP became effective,
until either such notice is withdrawn or such covenant is amended in a manner
satisfactory to the Company and the Required Lenders.
1. References herein to "fiscal year" and "fiscal quarter"
refer to such fiscal periods of the Company.
A. Currency Equivalents Generally. For all purposes of this Agreement
(but not for purposes of the preparation of any financial statements delivered
pursuant hereto), the equivalent in any Offshore Currency or other currency of
an amount in Dollars, and the equivalent in Dollars of an amount in any
Offshore Currency or other currency, shall be determined at the Spot Rate.
A. Introduction of Euro. For the avoidance of doubt, the parties
hereto affirm and agree that neither the fixation of the conversion rate of any
Offshore Currency of a country that is a member of the European Union against
the Euro as a single currency, in accordance with the Treaty Establishing the
European Economic Community, as amended by the Treaty on the European Union
(the Maastricht Treaty), nor the conversion of any Obligations under the Loan
Documents from an Offshore Currency of a country that is a member of the
European Union into Euro, shall require the early termination of this Agreement
or the prepayment of any amount due under the Loan Documents or create any
liability of one party to another party for any direct or consequential loss
arising from any of such events. As of the date that any such Offshore
Currency is no longer the lawful currency of its respective country, all
payment obligations under the Loan Documents that would otherwise be in such
Offshore Currency shall thereafter by satisfied in Euro.
27
I. ARTICLE
THE CREDITS
A. Amounts and Terms of Commitments. Each Lender severally agrees, on
the terms and conditions set forth herein, to make Committed Loans to the
Company from time to time on any Business Day during the period from the
Closing Date to the Termination Date, in an aggregate Dollar Equivalent amount
not to exceed at any time outstanding the amount set forth on Schedule 2.1
(such amount, as the same may be reduced under Section 2.8 or as a result of
one or more assignments under Section 10.8, such Lender's "Commitment");
provided, however, that the Total Outstandings shall not at any time exceed the
combined Commitments; and provided, further, that the aggregate Dollar
Equivalent principal amount of all outstanding Loans (whether Committed Loans
or Bid Loans) of any Lender plus such Lender's participation interest in all
Swing Line Loans and BA Outstandings shall not at any time exceed such Lender's
Commitment. Within the foregoing limits, and subject to the other terms and
conditions hereof, the Company may borrow under this Section 2.1, prepay under
Section 2.9 and reborrow under this Section 2.1.
1. Loan Accounts. The Loans made by each Lender shall be evidenced
by one or more accounts or records maintained by such Lender in the ordinary
course of business. The accounts or records maintained by the Agent and each
Lender shall be rebuttably presumptive evidence of the amount of the Loans made
by the Lenders to the Company, and the interest and payments thereon. Any
failure so to record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Company hereunder to pay any amount
owing with respect to the Loans.
1. Upon the request of any Lender made through the Agent, the
Loans made by such Lender may be evidenced by one or more Notes, instead of or
in addition to loan accounts. Each such Lender shall endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it
and the amount of each payment of principal made by the Company with respect
thereto. Each such Lender is irrevocably authorized by the Company to endorse
its Note(s) and each Lender's record shall be rebuttably presumptive evidence;
provided, however, that the failure of a Lender to make, or an error in making,
a notation thereon with respect to any Loan shall not limit or otherwise affect
the obligations of the Company hereunder or under any such Note to such Lender.
1. Procedure for Committed Borrowing. Each Committed Borrowing shall
be made upon the Company's irrevocable written notice delivered to the Agent in
the form of a Notice of Committed Borrowing, which notice must be received by
the Agent prior to (i) 11:00 a.m. (Chicago time) four Business Days prior to
the requested Borrowing Date, in the case of Offshore Currency Loans, (ii) 9:00
a.m.(Chicago time) two Business Days prior to the requested Borrowing Date, in
the case of Offshore Rate
28
Loans denominated in Dollars, and (iii) 11:00 a.m. (Chicago time) on the
requested Borrowing Date, in the case of Base Rate Loans, specifying:
(1) the amount of the Committed Borrowing, which shall be
in an aggregate amount not less than the Minimum Tranche;
(1) the requested Borrowing Date, which shall be a
Business Day;
(1) the Type of Loans comprising such Committed
Borrowing;
(1) in the case of Offshore Rate Committed Loans,
the duration of the initial Interest Period therefor; and
(1) in the case of a Borrowing of Offshore Currency
Loans, the Applicable Currency.
1. The Dollar Equivalent amount of any Committed Borrowing in
an Offshore Currency will be determined by the Agent for such Borrowing on
the Computation Date therefor in accordance with subsection 2.5(a). The Agent
will promptly notify each Lender of its receipt of any Notice of Committed
Borrowing and of the amount of such Lender's Unused Commitment Share of such
Borrowing. In the case of a Borrowing comprised of Offshore Currency Loans,
such notice will provide the approximate amount of each Lender's Unused
Commitment Share of such Borrowing, and the Agent will, upon the determination
of the Dollar Equivalent amount of such Borrowing as specified in the related
Notice of Committed Borrowing, promptly notify each Lender of the exact amount
of such Lender's Unused Commitment Share of such Borrowing.
1. Each Lender will make the amount of its Unused
Commitment Share of each Committed Borrowing available to the Agent for the
account of the Company at the Agent's Payment Office on the Borrowing Date
requested by the Company in Same Day Funds and in the requested currency (i) in
the case of a Committed Borrowing comprised of Loans in Dollars, by noon
(Chicago time) and (ii) in the case of a Borrowing comprised of Offshore
Currency Loans, by such time as the Agent may specify. The proceeds of all
such Committed Loans will then be made available to the Company by the Agent at
such office by crediting the account of the Company on the books of BofA with
the aggregate of the amounts made available to the Agent by the Lenders and in
like funds as received by the Agent.
1. After giving effect to any Committed Borrowing, unless
the Agent otherwise consents, there may not be more than ten different Interest
Periods in effect for all Committed Borrowings.
29
1. Conversion and Continuation Elections for Committed Borrowings.
The Company may, upon irrevocable written notice to the Agent in accordance
with subsection 2.4(b):
a) elect, as of any Business Day, in the case of Base Rate
Committed Loans, or as of the last day of the applicable Interest Period,
in the case of Offshore Rate Committed Loans denominated in Dollars, to
convert any such Committed Loans (or any part thereof in an aggregate
amount not less than the Minimum Tranche) into Committed Loans in Dollars
of any other Type; or
a) elect as of the last day of the applicable Interest
Period, to continue any Committed Loans having Interest Periods expiring
on such day (or any part thereof in an amount not less than the Minimum
Tranche) as Committed Loans of the same Type;
provided that if at any time the aggregate amount of Offshore Rate Committed
Loans denominated in Dollars in respect of any Committed Borrowing is reduced,
by payment, prepayment, or conversion of part thereof, to be less than the
Minimum Tranche, such Offshore Rate Committed Loans shall automatically convert
into Base Rate Committed Loans.
1. The Company shall deliver a Notice of
Conversion/Continuation to be received by the Agent not later than (i) 11:00
a.m. (Chicago time) four Business Days prior to the Conversion/Continuation
Date, if the Committed Loans are to be continued as Offshore Currency Loans;
(ii) 10:00 a.m. (Chicago time) two Business Days in advance of the
Conversion/Continuation Date, if the Committed Loans are to be converted into
or continued as Offshore Rate Committed Loans denominated in Dollars; and (iii)
11:00 a.m. (Chicago time) on the Conversion/Continuation Date, if the Committed
Loans are to be converted into Base Rate Committed Loans, specifying:
(1) the proposed Conversion/Continuation Date;
(1) the aggregate amount of Committed Loans to be converted
or continued;
(1) the Type of Committed Loans resulting from the proposed
conversion or continuation; and
(1) in the case of conversions into Offshore Rate Committed
Loans, the duration of the requested Interest Period.
1. If upon the expiration of any Interest Period applicable to
Offshore Rate Committed Loans denominated in Dollars, the Company has failed
to select timely a new Interest Period to be applicable to such Offshore Rate
Committed
30
Loans, the Company shall be deemed to have elected to convert such Offshore
Rate Committed Loans into Base Rate Committed Loans effective as of the
expiration date of such Interest Period. If the Company has failed to select a
new Interest Period to be applicable to Offshore Currency Loans by the
applicable time on the fourth Business Day in advance of the expiration date of
the current Interest Period applicable thereto as provided in subsection
2.4(b), or if any Event of Default or Unmatured Event of Default shall then
exist, subject to the provisions of subsection 2.5(d), the Company shall be
deemed to have elected to continue such Offshore Currency Loans on the basis of
a one month Interest Period.
1. The Agent will promptly notify each Lender of its
receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Company, the Agent will promptly notify each Lender of the
details of any automatic conversion. All conversions and continuations shall
be made ratably according to the respective outstanding principal amounts of
the Committed Loans with respect to which the notice was given held by each
Lender.
1. Unless the Required Lenders otherwise consent, during
the existence of an Event of Default or Unmatured Event of Default, the Company
may not elect to have a Loan converted into or continued as an Offshore Rate
Committed Loan.
1. After giving effect to any conversion or continuation
of Committed Loans, unless the Agent shall otherwise consent, there may not be
more than ten different Interest Periods in effect for all Committed Loans.
1. Utilization of Commitments in Offshore Currencies. The Agent will
determine the Dollar Equivalent amount with respect to (i) any Borrowing
comprised of Offshore Currency Loans as of the requested Borrowing Date, (ii)
all outstanding Offshore Currency Loans as of the last Business Day of each
month, and (iii) any outstanding Offshore Currency Loan as of any
redenomination date pursuant to this Section 2.5 or Section 3.2 or 3.5 and any
date on which the Commitments are reduced pursuant to Section 2.8.
1. In the case of a proposed Borrowing comprised of Offshore
Currency Loans, the Lenders shall be under no obligation to make Offshore
Currency Loans in the requested Offshore Currency as part of such Borrowing if
the Agent has received notice from any of the Lenders by 3:00 p.m. (Chicago
time) four Business Days prior to the day of such Borrowing that such Lender
cannot provide Loans in the requested Offshore Currency, in which event the
Agent will promptly give notice to the Company that the Borrowing in the
requested Offshore Currency is not then available, and notice thereof also will
be given promptly by the Agent to the Lenders. If the Agent shall have so
notified the Company that any such Borrowing in a requested Offshore Currency
is not then available, the Company may, by notice to the Agent not later than
3:00 p.m. (Chicago time) three Business Days prior to the requested date of
such Borrowing, withdraw the Notice of Committed Borrowing relating to such
requested
31
Borrowing. If the Company does so withdraw such Notice of Committed
Borrowing, the Borrowing requested therein shall not occur and the Agent will
promptly so notify each Lender. If the Company does not so withdraw such
Notice of Committed Borrowing, the Agent will promptly so notify each Lender
and such Notice of Committed Borrowing shall be deemed to be a Notice of
Committed Borrowing that requests a Borrowing comprised of Base Rate Loans in
an aggregate amount equal to the amount of the originally requested Borrowing
as expressed in Dollars in the Notice of Committed Borrowing; and in such
notice by the Agent to each Lender the Agent will state such aggregate amount
of such Borrowing in Dollars and such Lender's Unused Commitment Share thereof.
2. In the case of a proposed continuation of Offshore Currency
Loans for an additional Interest Period pursuant to Section 2.4, the Lenders
shall be under no obligation to continue such offshore Currency Loans if the
Agent has received notice from any of the Lenders by 3:00 p.m. (Chicago time)
four Business Days prior to the day of such continuation that such Lender
cannot continue to provide Loans in the relevant Offshore Currency, in which
event the Agent will promptly give notice to the Company that the continuation
of such Offshore Currency Loans in the relevant Offshore Currency is not then
available, and notice thereof also will be given promptly by the Agent to the
Lenders. If the Agent shall have so notified the Company that any such
continuation of Offshore Currency Loans is not then available, any Notice of
Continuation/Conversion with respect thereto shall be deemed withdrawn and such
Offshore Currency Loans shall be repaid on the last day of the Interest Period
with respect to such offshore Currency Loans.
1. Notwithstanding anything herein to the contrary, during the
existence of an Event of Default, upon the request of the Required Lenders, all
or any part of any outstanding Offshore Currency Loans shall be redenominated
and converted into Base Rate Committed Loans in Dollars with effect from the
last day of the Interest Period with respect to such Offshore Currency Loans.
The Agent will promptly notify the Company of any request pursuant to the
foregoing sentence.
1. The Company shall be entitled to request that Loans
hereunder also be permitted to be made in any other lawful currency, in
addition to the eurocurrencies specified in the definition of "Offshore
Currency" herein, that in the opinion of the Required Lenders is at such time
freely traded in the offshore interbank foreign exchange markets and is freely
transferable and freely convertible into Dollars (an "Agreed Alternative
Currency"). The Company shall deliver to the Agent any request for designation
of an Agreed Alternative Currency not later than 10:00 a.m. (Chicago time) at
least seven Business Days in advance of the date of any Borrowing hereunder
proposed to be made in such Agreed Alternative Currency. Upon receipt of any
such request the Agent will promptly notify the Lenders thereof, and each
Lender will use its best efforts to respond to such request within two Business
Days of receipt thereof. Each Lender may grant or accept such request in its
sole discretion. The Agent will promptly notify the Company of the acceptance
or rejection of any such request.
32
A. Bid Borrowings. In addition to Committed Borrowings pursuant to
Section 2.3, each Lender severally agrees that the Company may, as set forth in
Section 2.7, from time to time request the Lenders prior to the Termination
Date to submit offers to make Bid Loans to the Company; provided that the
Lenders may, but shall have no obligation to, submit such offers and the
Company may, but shall have no obligation to, accept any such offers; and
provided, further, that (a) the Total Outstandings shall not at any time exceed
the combined Commitments, (b) the aggregate Dollar Equivalent principal amount
of all outstanding Loans (whether Bid Loans or Committed Loans) of any Lender
plus such Lender's participation interest in all Swing Line Loans and BA
Outstandings shall not at any time exceed such Lender's Commitment, and (c)
after giving effect to any Bid Borrowing, there may not be more than ten (10)
different Interest Periods in effect for all Bid Borrowings.
B. Procedure for Bid Borrowings.
1. When the Company wishes to request the Lenders to
submit offers to make Bid Loans hereunder, it shall transmit to the Agent and
each Lender by telephone call followed promptly by facsimile transmission a
notice in substantially the form of Exhibit C (a "Competitive Bid Request") so
as to be received no later than 9:00 a.m. (Chicago time) (x) four Business Days
prior to the date of a proposed Bid Borrowing in the case of a LIBOR Auction or
(y) on the date of a proposed Bid Borrowing in the case of an Absolute Rate
Auction, specifying:
a) the date of such Bid Borrowing, which shall be a
Business Day;
a) the aggregate amount of such Bid Borrowing, which shall
be a minimum amount of $3,000,000 or a higher integral multiple of
$1,000,000;
a) whether the Competitive Bids requested are to be for
LIBOR Bid Loans or Absolute Rate Bid Loans or both; and
a) the duration of the Interest Period applicable
thereto, subject to the provisions of the definition of "Interest Period"
herein.
Subject to subsection 2.7(b), the Company may not request Competitive Bids for
more than three Interest Periods in a single Competitive Bid Request and may
not request Competitive Bids more than twice in any period of five Business
Days.
a) Each Lender may at its discretion submit a Competitive Bid
containing an offer or offers to make Bid Loans in response to any
Competitive Bid Request. Each Competitive Bid must comply with the
requirements of this subsection 2.7(b) and must be submitted to the
Company by facsimile transmission at the Company's office for notices not
later than 9:30 a.m. (Chicago time) (1) three Business Days prior to the
proposed date of Borrowing, in the case
33
of a LIBOR Auction, or (2) on the proposed date of Borrowing, in the
case of an Absolute Rate Auction.
a) Each Competitive Bid shall be in substantially the
form of Exhibit D, specifying therein:
(1) the proposed date of Borrowing;
(1) the principal amount of each Bid Loan for which
such Competitive Bid is being made, which principal amount (x) may
be equal to, greater than or less than the Commitment of the quoting
Lender, (y) must be $3,000,000 or a higher integral multiple of
$1,000,000 and (z) may not exceed the principal amount of Bid Loans
for which Competitive Bids were requested;
(1) if the Company elects a LIBOR Auction, the margin
above or below LIBOR (the "LIBOR Bid Margin") offered for each
such Bid Loan, expressed as a percentage (rounded to the nearest
1/16th of 1%) to be added to or subtracted from the applicable
LIBOR, and the Interest Period applicable thereto;
(1) if the Company elects an Absolute Rate Auction,
the rate of interest per annum (which shall be an integral multiple
of 1/100th of 1%) (the "Absolute Rate") offered for each such Bid
Loan; and
(1) the identity of the quoting Lender.
A Competitive Bid may contain up to three separate offers by the quoting
Lender with respect to each Interest Period specified in the related
Competitive Bid Request.
a) Any Competitive Bid shall be disregarded if it:
(1) is not substantially in conformity with Exhibit D
or does not specify all of the information required by subsection
(b)(ii) of this Section;
(1) contains qualifying, conditional or similar
language;
(1) proposes terms other than or in addition to those
set forth in the applicable Competitive Bid Request; or
34
(1) arrives after the time set forth in subsection
(b)(i) of this Section.
1. Not later than 10:00 a.m. (Chicago time) three Business
Days prior to the proposed date of Borrowing, in the case of a LIBOR Auction,
or 10:00 a.m. (Chicago time) on the proposed date of Borrowing, in the case of
an Absolute Rate Auction, the Company shall notify each Lender whose
Competitive Bid the Company is accepting of its acceptance of the offer
received pursuant to subsection 2.7(b) and the amount of the Bid Loan or Bid
Loans to be made by such Lender on the date of the Bid Borrowing. The Company
shall be under no obligation to accept any offer and may choose to reject all
offers. The Company may accept any Competitive Bid in whole or in part;
provided that:
a) the aggregate principal amount of each Bid Borrowing
may not exceed the applicable amount set forth in the related
Competitive Bid Request;
a) the principal amount of each Bid Borrowing must be
$3,000,000 or a higher integral multiple of $1,000,000;
a) acceptance of offers may only be made on the basis of
ascending LIBOR Bid Margins or Absolute Rates, as the case may be,
within each Interest Period; and
a) the Company may not accept any offer that is described
in subsection 2.7(b)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
1. If offers are made by two or more Lenders with the same
LIBOR Bid Margins or Absolute Rates, as the case may be, for a greater
aggregate principal amount than the amount in respect of which such offers are
accepted for the related Interest Period, the principal amount of Bid Loans in
respect of which such offers are accepted shall be allocated by the Company
among such Lenders as nearly as possible (in such multiples, not less than
$1,000,000, as the Company may deem appropriate) in proportion to the aggregate
principal amounts of such offers.
a) The Company shall notify the Agent of all Competitive Bids
accepted and the amount and maturity of each Bid Loan of each Lender
whose Competitive Bid has been accepted.
a) Each Lender which has received notice pursuant to
subsection 2.7(c) that its Competitive Bid has been accepted shall make
the amounts of such Bid Loans available to the Agent for the account of
the Company at the Agent's Payment Office by 1:00 p.m. (Chicago time) on
the date of the Bid Borrowing, in Same Day Funds.
35
a) Promptly following each Bid Borrowing, the Agent shall
notify each Lender of the amount and maturity of each Bid Loan borrowed
pursuant to such Bid Borrowing.
a) From time to time, the Company and the Lenders shall
furnish such information to the Agent as the Agent may request relating
to the making of Bid Loans, including the amounts, interest rates, dates
of borrowings and maturities thereof, for purposes of the allocation of
amounts received from the Company for payment of all amounts owing
hereunder.
1. If, on the proposed date of Borrowing, the Commitments
have not been terminated and all applicable conditions to funding referenced in
Sections 3.2, 3.5 and 4.2 hereof are satisfied, the Lender or Lenders whose
offers the Company has accepted will fund each Bid Loan so accepted. Nothing
in this Section 2.7 shall be construed as a right of first offer in favor of
the Lenders or to otherwise limit the ability of the Company to request and
accept credit facilities from any Person (including any of the Lenders),
provided that no Event of Default or Unmatured Event of Default would otherwise
arise or exist as a result of the Company executing, delivering or performing
under such credit facilities.
A. Voluntary Termination or Reduction of Commitments. The Company may,
upon not less than five Business Days' prior notice to the Agent, terminate the
Commitments, or permanently reduce the Commitments by an aggregate amount of
$5,000,000 or a higher integral multiple of $1,000,000; unless, after giving
effect thereto and to any payments or prepayments of Loans made on the
effective date thereof, the aggregate principal Dollar Equivalent amount of all
Loans would exceed the amount of the combined Commitments then in effect. Once
reduced in accordance with this Section, the Commitments may not be increased.
Any reduction of the Commitments shall be applied to each Lender according to
its Pro Rata Share. All accrued commitment fees to, but not including, the
effective date of any reduction or termination of Commitments, shall be paid on
the effective date of such reduction or termination.
1. Optional Prepayments. Subject to Section 3.4, the Company may,
from time to time, upon irrevocable notice to the Agent not later than 11:00
a.m. (Chicago time) on any Business Day, ratably prepay Committed Loans in
whole or in part, in minimum Dollar Equivalent amounts of not less than the
Minimum Tranche. The Company shall deliver a notice of prepayment in
accordance with Section 10.2 to be received by the Agent not later than (i)
11:00 a.m. (Chicago time) three Business Days in advance of the prepayment date
if the Committed Loans to be prepaid are Offshore Rate Committed Loans, and
(ii) 10:00 a.m. (Chicago time) on the prepayment date if the Committed Loans to
be prepaid are Base Rate Loans. Such notice of prepayment shall specify the
date and amount of such prepayment and whether such prepayment is of Base Rate
Loans, Offshore Rate Committed Loans, or any combination thereof and the
Applicable Currency. Such notice shall not thereafter be revocable by the
Company. The
36
Agent will promptly notify each Lender of its receipt of any such notice,
and of such Lender's share of such prepayment (ratably in accordance with each
Lender's aggregate Dollar Equivalent principal amount of Loans outstanding).
If such notice is given by the Company, the Company shall make such prepayment
and the payment amount specified in such notice shall be due and payable on the
date specified therein, together with, in the case of Offshore Rate Committed
Loans, accrued interest to each such date on the amount prepaid and any amounts
required pursuant to Section 3.4.
1. No Bid Loan may be voluntarily prepaid without the consent
of the Lender that holds such Bid Loan.
A. Currency Exchange Fluctuations. Subject to Section 3.4, if on any
Computation Date the Agent shall have determined that the Total Outstandings
exceed the combined Commitments of all Lenders by more than $250,000 due to a
change in applicable rates of exchange between Dollars, on the one hand, and
Offshore Currencies on the other hand, then the Agent shall give notice to the
Company that a prepayment is required under this subsection, and the Company
agrees thereupon to make prepayments of Loans such that, after giving effect to
such prepayment, the Total Outstandings do not exceed the combined Commitments
of all Lenders.
A. Repayment. The Company shall repay each Bid Loan on the last day of
each Interest Period therefor. The Company shall repay all Loans (including
any outstanding Bid Loan) on the Termination Date.
1. Interest. Each Committed Loan shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to (i) at all times such Committed Loan is a Base Rate
Loan, the Base Rate as in effect from time to time and (ii) at all times such
Committed Loan is an Offshore Rate Loan, the sum of the Offshore Rate for the
applicable Interest Period plus the Applicable Margin as in effect from time to
time. Each Bid Loan shall bear interest on the outstanding principal amount
thereof from the relevant Borrowing Date at a rate per annum equal to the
Offshore Rate plus (or minus) the LIBOR Bid Margin or the Absolute Bid Rate, as
the case may be. Each Swing Line Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per annum
equal to the sum of (i) Cost of Funds Rate as in effect from time to time plus
(ii) 0.10% plus (c) the Applicable Margin as in effect from time to time.
1. Interest on each Loan shall be paid in arrears on each
Interest Payment Date. Interest also shall be paid on the date of any
conversion of Offshore Rate Committed Loans under Section 2.4 and prepayment of
Offshore Rate Committed Loans under Section 2.9, in each case for the portion
of the Loans so prepaid. During the existence of any Event of Default,
interest shall be paid on demand of the Agent at the request or with the
consent of the Required Lenders.
37
1. Notwithstanding subsection (a) of this Section, while
any Event of Default exists, the Company shall pay interest (after as well as
before entry of judgment thereon to the extent permitted by law) on the
principal amount of all outstanding Loans and, to the extent permitted by
applicable law, on any other amount payable hereunder or under any other Loan
Document, at a rate per annum equal to the rate otherwise applicable thereto
pursuant to the terms hereof or such other Loan Document (or, if no such rate
is specified, the Base Rate) plus 2%. All such interest shall be payable on
demand.
1. Anything herein to the contrary notwithstanding, the
obligations of the Company to any Lender hereunder shall be subject to the
limitation that payments of interest shall not be required for any period for
which interest is computed hereunder, to the extent (but only to the extent)
that contracting for or receiving such payment by such Lender would be contrary
to the provisions of any law applicable to such Lender limiting the highest
rate of interest that may be lawfully contracted for, charged or received by
such Lender, and in such event the Company shall pay such Lender interest at
the highest rate permitted by applicable law.
A. Fees.
1. Certain Fees. The Company shall pay certain fees to
the Agent and the Arranger for their own respective accounts at the times and
in the amounts required by the letter agreement (the "Fee Letter") among the
Company, the Agent and the Arranger dated March 14, 1997.
1. Facility Fees. The Company shall pay to the Agent for
the account of each Lender a facility fee on the amount of such Lender's
Commitment, regardless of usage, as calculated on a quarterly basis in arrears
on the last Business Day of each calendar quarter and on the Termination Date
(or such later date on which all Obligations have been paid in full) at the
Facility Fee Rate. Such facility fee shall accrue from the Effective Date to
the Termination Date (or such later date on which all Obligations have been
paid in full) and shall be due and payable quarterly in arrears on the last
Business Day of each calendar quarter, on the Termination Date and thereafter
on demand; provided that, in connection with any reduction or termination of
Commitments under Section 2.8, the accrued facility fee calculated for the
period ending on such date shall also be paid on the date of such reduction or
termination, with (in the case of a reduction) the following quarterly payment
being calculated on the basis of the period from such reduction date to the
quarterly payment date. The facility fees shall accrue at all times after the
Closing Date, including at any time during which one or more conditions in
Article IV are not met.
1. Commitment Fees. The Company shall pay to the Agent
for the account of each Lender a commitment fee in such Lender's Pro Rata Share
of the unused amount of the combined Commitments, as calculated by the Agent on
a quarterly basis in arrears on the last day of each calendar quarter and on
the Termination Date, at
38
the Commitment Fee Rate. Such commitment fees shall accrue from the Effective
Date to the Termination Date and shall be due and payable quarterly in arrears
on the last Business Day of each calendar quarter and on the Termination Date.
The commitment fees shall accrue at all times after the Effective Date,
including at any time during which one or more conditions in Article IV are not
met.
1. Computation of Fees and Interest. All computations of interest
for Base Rate Committed Loans when the Base Rate is determined by BofA's
"reference rate", and all computations of interest for Offshore Currency Loans
demoninated in English pounds sterling shall be made on the basis of a year of
365 or 366 days, as the case may be, and actual days elapsed. All other
computations of interest and fees shall be made on the basis of a 360-day year
and actual days elapsed. Interest and fees shall accrue during each period
during which such interest or such fees are computed from the first day thereof
to the last day thereof.
1. Each determination of an interest rate or a Dollar
Equivalent amount by the Agent shall be conclusive and binding on the Company
and the Lenders in the absence of manifest error. The Agent will, at the
request of the Company or any Lender, deliver to the Company or such Lender, as
the case may be, a statement showing the quotations used by the Agent in
determining any interest rate or Dollar Equivalent amount. Each Reference
Lender agrees to deliver to the Agent timely information for the purpose of
determining the Offshore Rate. If any one of the Reference Lenders shall fail
to furnish such information to the Agent for any such interest rate, the Agent
shall determine such interest rate on the basis of the information furnished by
the remaining Reference Lender or Reference Lenders.
2. Payments by the Company. All payments to be made by the Company
shall be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Company shall be made to the
Agent for the account of the Lenders at the Agent's Payment Office, and (i)
with respect to principal of, interest on, and any other amount relating to any
Offshore Currency Loan, shall be made in the Offshore Currency in which such
Loan is denominated or payable, and (ii) with respect to all other amounts
payable hereunder, shall be made in Dollars. Such payments shall be made in
Same Day Funds and (x) in the case of Offshore Currency payments, no later than
such time on the dates specified herein as may be determined by the Agent to be
necessary for such payment to be credited on such date in accordance with
normal banking procedures in the place of payment, and (y) in the case of any
Dollar payments, no later than 11:00 a.m. (Chicago time) on the date specified
herein. The Agent will promptly distribute to each Lender its Pro Rata Share
(or other applicable share as expressly provided herein) of such payment in
like funds as received. Any payment received by the Agent later than the time
specified in clause (x) or (y) above shall be deemed to have been received on
the following Business Day and any applicable interest or fee shall continue to
accrue.
1. Whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day (unless,
in the
39
case of an Offshore Rate Loan, the following Business Day is in another
calendar month, in which case such payment shall be made on the preceding
Business Day), and such extension of time shall in such case be included in the
computation of interest or fees, as the case may be.
1. Unless the Agent receives notice from the Company prior
to the date on which any payment is due to the Lenders that the Company will
not make such payment in full as and when required, the Agent may assume that
the Company has made such payment in full to the Agent on such date in Same Day
Funds and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent the Company has not made
such payment in full to the Agent, each Lender shall repay to the Agent on
demand such amount distributed to such Lender, together with interest thereon
at the Federal Funds Rate or, in the case of a payment in an Offshore Currency,
the Overnight Rate for each day from the date such amount is distributed to
such Lender until the date repaid.
1. Payments by the Lenders to the Agent. Unless the Agent receives
notice from a Lender on or prior to the Closing Date or, with respect to any
Committed Borrowing after the Closing Date, at least one Business Day prior to
the date of a Committed Borrowing that such Lender will not make available as
and when required hereunder to the Agent for the account of the Company the
amount of such Lender's Pro Rata Share of such Committed Borrowing, the Agent
may assume that such Lender has made such amount available to the Agent in Same
Day Funds on the Borrowing Date and the Agent may (but shall not be so
required), in reliance upon such assumption, make available to the Company on
such date a corresponding amount. If and to the extent any Lender shall not
have made its full amount available to the Agent in Same Day Funds and the
Agent in such circumstances has made available to the Company such amount, such
Lender shall on the Business Day following such Borrowing Date make such amount
available to the Agent, together with interest at the Federal Funds Rate or, in
the case of a payment in an Offshore Currency, the Overnight Rate for each day
during such period. A notice of the Agent submitted to any Lender with respect
to amounts owing under this subsection (a) shall be conclusive, absent manifest
error. If such amount is so made available, such payment to the Agent shall
constitute such Lender's Committed Loan on the date of Borrowing for all
purposes of this Agreement. If such amount is not made available to the Agent
on the Business Day following the Borrowing Date, the Agent will notify the
Company of such failure to fund and, upon demand by the Agent, the Company
shall pay such amount to the Agent for the Agent's account, together with
interest thereon for each day elapsed since the date of such Borrowing, at a
rate per annum equal to the interest rate applicable at the time to the
Committed Loans comprising such Committed Borrowing.
1. The failure of any Lender to make any Loan on any
Borrowing Date shall not relieve any other Lender of any obligation hereunder
to make a
40
Loan on such Borrowing Date, 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 any
Borrowing Date.
1. Sharing of Payments, Etc. Whenever any payment received by the
Agent to be distributed to the Lenders is insufficient to pay in full the
amounts then due and payable to the Lenders, and the Agent has not received a
Payment Sharing Notice, such payment shall be distributed to the Lenders (and
for purposes of this Agreement shall be deemed to have been applied by the
Lenders, notwithstanding the fact that any Lender may have made a different
application in its books and records) in the following order: first, to the
payment of the principal amount of the Loans which is then due and payable and
any reimbursement obligation of the Company in respect of any BA which is then
due and payable, ratably among the Lenders (including the Accepting Lender and
the Swing Line Lender) in accordance with the aggregate amount of such
Obligations owed to each Lender; second, to the payment of interest then due
and payable on the Loans and on any unpaid reimbursement obligations in respect
of BAs, ratably among the Lenders (including the Accepting Lender and the Swing
Line Lender) in accordance with the aggregate amount of interest owed to each
Lender; third, to the payment of the fees payable under subsection 2.13(b) and
(c), ratably among the Lenders in accordance with their respective Pro Rata
Shares; and fourth, to the payment of any other amount payable under this
Agreement, ratably among the Lenders in accordance with the aggregate amount
owed to each Lender.
1. After the Agent has received a Payment Sharing Notice, and
for so long thereafter as any Event of Default exists, all payments received by
the Agent to be distributed to the Lenders shall be distributed to the Lenders
(and for purposes of this Agreement shall be deemed to have been applied by the
Lenders, notwithstanding the fact that any Lender may have made a different
application in its books and records) in the following order: first, to the
payment of amounts payable under Section 10.4, ratably among the Lenders in
accordance with the aggregate amount owed to each Lender; second, to the
payment of fees payable under subsection 2.13(b) and (c), ratably among the
Lenders in accordance with their respective Pro Rata Shares; third, to the
payment of the interest accrued on and the principal amount of all of the Loans
and all reimbursement obligations of the Company in respect of BAs, regardless
of whether any such amount is then due and payable, ratably among the Lenders
(including the Accepting Lender and the Swing Line Lender) in accordance with
the aggregate amount of such Obligations owed to each Lender; and fourth, to
the payment of any other amount payable under this Agreement, ratably among the
Lenders (including the Accepting Lender and the Swing Line Lender) in
accordance with the aggregate amount owed to each Lender.
1. If, other than as expressly provided elsewhere herein, any
Lender shall obtain any payment or other recovery (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) on
account of principal of or interest on any Loan or any reimbursement obligation
in respect of a BA, or any other amount payable hereunder, in excess of the
share of payments and other recoveries such Lender would have received if such
payment or other recovery had been distributed pursuant to the
41
provisions of subsection 2.17(a) or (b) (whichever is applicable at the time of
such payment or other recovery), such Lender shall immediately (i) notify the
Agent of such fact and (ii) purchase from the other Lenders such participations
in the Loans made by (or other Obligations owed to) them as shall be necessary
to cause such purchasing Lender to share the excess payment or other recovery
pro rata with each of them in accordance with the order of payments set forth
in subsection 2.17(a) or (b), as the case may be; provided that if all or any
portion of such excess payment or other recovery is thereafter recovered from
the purchasing Lender, such purchase shall to that extent be rescinded and each
other Lender shall repay to the purchasing Lender the purchase price paid
therefor, together with an amount equal to such paying Lender's ratable share
(according to the proportion of (A) the amount of such paying Lender's 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 Company agrees that any Lender
so purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 10.10) with respect to such participation as
fully as if such Lender were the direct creditor of the Company in the amount
of such participation. The Agent will keep records (which shall be conclusive
and binding in the absence of manifest error) of participations purchased under
this Section and will in each case notify the Lenders following any such
purchases or repayments.
A. Swing Line Commitment. Subject to the terms and conditions of this
Agreement, the Swing Line Lender agrees to make loans to the Company on a
revolving basis (each such loan, a "Swing Line Loan") from time to time on any
Business Day during the period from the Closing Date to the Termination Date in
an aggregate principal amount at any one time outstanding not to exceed U.S.
$30,000,000; provided, however, that, after giving effect to any proposed Swing
Line Loan, the Total Outstandings shall not exceed the combined Commitments.
A. Borrowing Procedures for Swing Line Loans. The Company shall
provide a Notice of Borrowing or telephonic notice (followed by a confirming
Notice of Borrowing) to the Agent and the Swing Line Lender of each proposed
borrowing pursuant to Section 2.18 not later than 12:00 noon (Chicago time) on
the proposed Borrowing Date. Each such notice shall be effective upon receipt
by the Agent and the Swing Line Lender and shall specify the date and the
principal amount of borrowing. Unless the Swing Line Lender has received
written notice prior to 11:00 a.m. (Chicago time) on the proposed Borrowing
Date from the Agent or any Lender that one or more of the conditions precedent
set forth in Article IV with respect to such borrowing is not then satisfied,
the Swing Line Lender shall pay over the requested principal amount to the
Company on the requested Borrowing Date in Same Day Funds. Each Swing Line
Loan shall be made on a Business Day and shall be in the amount of at least
U.S. $500,000 and an integral multiple of U.S. $100,000. The Swing Line Lender
will promptly notify the Agent of the making and amount of each Swing Line
Loan.
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1. Prepayment or Refunding of Swing Line Loans. The Company may, at
any time and from time to time, prepay any Swing Line Loan in whole or in part,
in an amount of at least U.S. $500,000 and an integral multiple of U.S.
$100,000. The Company shall deliver a notice of prepayment to the Agent and the
Swing Line Lender not later than 11:00 a.m. (Chicago time) on the Business Day
of such prepayment, specifying the date and amount of such prepayment. If such
notice is given by the Company, the payment amount specified in such notice
shall be due and payable on the date specified therein.
1. The Swing Line Lender may, at any time in its sole and
absolute discretion, on behalf of the Company (which hereby irrevocably directs
the Swing Line Lender to act on its behalf), request each Lender to make a Base
Rate Committed Loan in an amount equal to such Lender's Unused Commitment Share
of the principal amount of the Swing Line Loans outstanding on the date such
notice is given. Unless any of the events described in subsection 8.1(g), (h),
(i) or (j) shall have occurred (in which event the procedures of Section 2.21
shall apply), and regardless of whether the conditions precedent set forth in
this Agreement to the making of a Base Rate Committed Loan are then satisfied
or the aggregate amount of such Base Rate Committed Loans is not in the minimum
or integral amount otherwise required hereunder, each Lender shall make the
proceeds of its Base Rate Committed Loan available to the Agent for the account
of the Swing Line Lender at the Agent's Payment Office prior to 12:00 noon
(Chicago time) in Same Day Funds on the Business Day next succeeding the date
such notice is given. The proceeds of such Base Rate Committed Loans shall be
immediately applied to repay the outstanding Swing Line Loans.
1. Participations in Swing Line Loans. If an event described in
subsection 8.1(g), (h), (i) or (j) occurs (or for any reason the Lenders may
not make Revolving Loans pursuant to Section 2.20), each Lender will, upon
notice from the Agent, purchase from the Swing Line Lender (and the Swing Line
Lender will sell to each Lender) an undivided participation interest in all
outstanding Swing Line Loans in an amount equal to such Lender's Unused
Commitment Share of the outstanding principal amount of the Swing Line Loans
(and each Lender will immediately transfer to the Agent, for the account of the
Swing Line Lender, in immediately available funds, the amount of its
participation).
1. Whenever, at any time after the Swing Line Lender has
received payment for any Lender's participation interest in the Swing Line
Loans pursuant to subsection 2.21(a), the Swing Line Lender receives any
payment on account thereof, the Swing Line Lender will distribute to the Agent
for the account of such Lender its participation interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's participation interest was
outstanding and funded) in like funds as received; provided, however, that in
the event that such payment received by the Swing Line Lender is required to be
returned, such Lender will return to the Agent for the account of the Swing
Line Lender any
43
portion thereof previously distributed by the Swing Line Lender to it in like
funds as such payment is required to be returned by the Swing Line Lender.
A. Participation Obligations Unconditional. (a) Each Lender's
obligation to make Base Rate Committed Loans pursuant to Section 2.20 and/or to
purchase participation interests in Swing Line Loans pursuant to Section 2.21
shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever, including (a) any set-off, counterclaim, recoupment,
defense or other right which such Lender may have against the Swing Line
Lender, the Company or any other Person for any reason whatsoever; (b) the
occurrence or continuance of an Event of Default; (c) any adverse change in the
condition (financial or otherwise) of the Company or any other Person; (d) any
breach of this Agreement or any other Loan Document by the Company or any other
Lender; (e) any inability of the Company to satisfy the conditions precedent to
borrowing set forth in this Agreement on the date upon which any Loan is to be
refunded or any participation interest therein is to be purchased; or (f) any
other circumstance, happening or event whatsoever, whether or not similar to
any of the foregoing.
(b) Notwithstanding the provisions of subsection 2.22(a), no Lender shall
be required to make any Base Rate Committed Loan to the Company to refund a
Swing Line Loan pursuant to Section 2.20 or to purchase a participation
interest in a Swing Line Loan pursuant to Section 2.21 if, prior to the making
by the Swing Line Lender of such Swing Line Loan, the Swing Line Lender
received written notice from any Lender specifying that such Lender believes in
good faith that one or more of the conditions precedent to the making of such
Swing Line Loan were not satisfied and, in fact, such conditions precedent were
not satisfied at the time of the making of such Swing Line Loan; provided that
the obligation of such Lender to make such Base Rate Committed Loan and to
purchase such participation interest shall be reinstated upon the earlier to
occur of (i) the date on which such Lender notifies the Swing Line Lender that
its prior notice has been withdrawn and (ii) the date on which all conditions
precedent to the making of such Swing Line Loan have been satisfied (or waived
by the Required Lenders or all Lenders, as applicable).
A. Conditions to Swing Line Loans. Notwithstanding any other provision
of this Agreement, the Swing Line Lender shall not be obligated to make any
Swing Line Loan if an Event of Default or Unmatured Event of Default exists or
would result therefrom.
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A. BA Subfacility.
1. Creation. Subject to the terms and conditions hereof,
at any time and from time to time from the Closing Date through the day 30 days
prior to the scheduled Termination Date, the Accepting Lender shall create and
discount such BAs as the Company may request by notice to the Accepting Lender
in accordance with the procedure set forth in subsection (b) below; provided
that upon creating and discounting any BA, the Total Outstandings will not
exceed the combined Commitments; and provided, further, that BA Outstandings
shall not at any time exceed $100,000,000. The maturity of any BA shall not be
less than 30 days or more than 180 days and shall not extend beyond the
scheduled Termination Date. Each BA shall comply with the Acceptance Documents
and shall be executed on behalf of the Company and presented to the Accepting
Lender pursuant to such procedures as are provided or required by the Accepting
Lender. The face amount of each BA shall be $3,000,000 or a higher integral
multiple of $1,000,000. The creation and maturity date of each BA shall be a
Business Day. Notwithstanding the foregoing, the Accepting Lender shall not be
obligated to create or discount any BA (i) that is not "eligible" pursuant to
paragraph 7 of Section 13 of the Federal Reserve Act (12 U.S.C. Section 372),
as amended from time to time, (ii) if creation thereof would cause the
Accepting Lender to exceed the maximum amount of outstanding bankers'
acceptances permitted by applicable law or (iii) if, in the reasonable opinion
of the Accepting Lender, general conditions in the public market for
rediscounting bankers' acceptances render it inadvisable to do so.
1. Notice. Each request for a BA shall be submitted in
writing (or requested by telephone and promptly confirmed in writing) to the
Accepting Lender and the Agent by 11:00 a.m. (Chicago time) on the date of
creation of the requested BA and shall be accompanied by such documents as are
specified therein and in the Acceptance Documents. The Accepting Lender will
promptly notify the Agent (which shall promptly advise each Lender) of the
creation of each BA and the amount and tenor thereof.
1. Issuance Fee. Upon the creation by the Accepting
Lender of a BA, the Accepting Lender shall discount such BA by deducting
from the face amount thereof a discount determined by the then current quoted
discount rate for bankers' acceptances of the Accepting Lender plus the BA
Commission, with such discount and BA Commission applied against the face
amount of the BA, and the Accepting Lender shall make such net amount available
in immediately available funds to the Company. The Accepting Lender shall
retain from the amount so deducted a commission, for the account solely of the
Accepting Lender, equal to .05% per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days). On the date of issuance of
each BA, the Accepting Lender shall make available in immediately available
funds to the Lenders, according to their respective Pro Rata Shares, an amount
equal to the BA Commission (after the Accepting Lender's issuance fee of .05%
has been deducted therefrom) for such BA. The Accepting Lender may retain or
45
rediscount, at its election, any BA and the amount received by the Accepting
Lender upon payment thereof at maturity or upon rediscounting shall be solely
for the account of the Accepting Lender.
1. Payment. As and when the Accepting Lender honors a BA,
the Company agrees to immediately repay the Accepting Lender in immediately
available funds the amount advanced by the Accepting Lender. In the event that
such funds are not made available to the Accepting Lender by the Company, then,
in order to implement the foregoing, the Company irrevocably authorizes the
Agent and each Lender to treat each such advance by the Accepting Lender as a
request for a Base Rate Committed Loan in the amount of such advance, to issue
Base Rate Committed Loans simultaneously with any such advance in the aggregate
amount of such advance, and to credit the proceeds of such Base Rate Committed
Loan so as to immediately eliminate the liability of the Company to the
Accepting Lender pertaining to such BA and immediately eliminate the liability
of each other Lender to the Accepting Lender with respect to its Unused
Commitment Share relating to such BA.
1. Participations in BAs. Each Lender shall be deemed at
all times to have a participation in each outstanding BA in an amount equal to
the result obtained by multiplying (i) such Lender's Unused Commitment Share
times (ii) the face amount of such BA. Without limiting the scope and nature
of each Lender's participation in any BA, to the extent that the Accepting
Lender has not been reimbursed by the Company (pursuant to an advance pursuant
to clause (d) or otherwise) for any payment required to be made by the
Accepting Lender under any BA, each Lender shall, according to its Unused
Commitment Share, reimburse the Accepting Lender promptly upon demand for the
amount of such payment. The obligation of each Lender to so reimburse the
Accepting Lender shall be absolute and unconditional and shall not be affected
by the occurrence of an Event of Default, an Unmatured Event of Default or any
other occurrence or event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Company to reimburse the Accepting
Lender for the amount of any payment made by the Accepting Lender under any BA,
together with interest at the Base Rate plus 2%. The Company hereby
specifically acknowledges and agrees that if the Company fails to perform in
accordance with the terms of any BA, the Acceptance Documents related thereto
or this Agreement as it relates to such BA, each lender shall have a claim
against the Company, to the extent of such Lender's pro rata participation in
such BA.
1. Limitation of Liability. None of the Accepting Lender,
any other Lender or any of their respective directors, officers, agents or
employees shall be liable, except for gross negligence or willful misconduct,
for any action taken or omitted under or in connection with any BA, any draft
to which a BA relates or any documents which in turn relate or pertain to any
such draft. When dealing with any BA, draft or related document, the Accepting
Lender shall be entitled to act (and shall be fully protected against any claim
of loss by the Company occasioned by the lack, or claimed lack, of authenticity
or authority of the issuance of any draft or any signature thereon, in
46
acting) upon any telegram, telex, teletype, bank wire, cable or radiogram or
any written application, notice, report, statement, certificate, resolution,
request, order, consent, letter or other instrument or communication reasonably
believed in good faith by the Accepting Lender to be genuine and correct and to
have been signed or sent or made by a proper Person. The Accepting Lender
shall examine Acceptance Documents with reasonable care to ascertain that they
appear on their face to be in accordance with the terms and conditions of the
related BA. The Company further agrees that, if any BA shall not, in the
reasonable opinion of the Agent or the Required Lenders, meet all requirements
for "eligible" bankers' acceptances (as determined in accordance with paragraph
7 of Section 13 of the Federal Reserve Act (12 U.S.C. Section 372)), the
Company shall, upon demand by the Agent, pay to the Agent for the account of
each of the Lenders additional amounts sufficient to compensate the Lenders for
any increased costs resulting therefrom (including costs resulting from any
reserve requirement, premium liability to the Federal Deposit Insurance
Corporation, or a higher discount rate). To demand payment under this
subsection 2.24(f), the Agent shall deliver to the Company a certificate
setting forth in reasonable detail the amount payable to the Agent (for the
account of each of the Lenders) hereunder and such certificate shall be
conclusive and binding on the Company in the absence of manifest error.
A. Extension of Scheduled Termination Date. The Company may,
not more than 120 nor less than 60 days prior to each of June 30, 1998 and June
30, 1999, request all Lenders to extend the scheduled Termination Date by one
year by means of a letter, addressed to each Lender and the Agent,
substantially in the form of Exhibit J. Each Lender electing (in its sole and
complete discretion) so to extend the scheduled Termination Date shall deliver
signed counterparts of such letter to the Company and the Agent no later than
30 days after the date of such request by the Company (and any Lender which
does not deliver such counterparts shall be deemed to have declined to extend
the scheduled Termination Date). If all Lenders elect to extend the scheduled
Termination Date, the scheduled Termination Date shall be extended for an
additional one-year period on the date on which the Agent has received signed
counterparts of such letter from all Lenders (and the Agent shall promptly
notify the Company and the Lenders of such extension). If any Lender declines
(or is deemed to have declined) to extend the Termination Date, the scheduled
Termination Date shall not be extended.
I. ARTICLE
TAXES, YIELD PROTECTION AND ILLEGALITY
1. Taxes. Any and all payments by the Company to each Lender and each
Agent under this Agreement and any other Loan Document shall be made free and
clear of, and without deduction or withholding for, any Taxes. In addition,
the Company shall pay all Other Taxes.
47
1. If the Company shall be required by law to deduct or
withhold any Taxes, Other Taxes or Further Taxes from or in respect of any sum
payable hereunder to any Lender or the Agent, then:
a) the sum payable shall be increased as necessary so
that, after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section), such Lender or the Agent, as the case may be, receives and
retains an amount equal to the sum it would have received and retained
had no such deductions or withholdings been made;
a) the Company shall make such deductions and withholdings;
a) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
a) the Company shall also pay to the Agent for the account
of any applicable Lender or the Agent, at the time interest is paid, all
additional amounts which such Lender or the Agent specifies as necessary
to preserve the after-tax yield such Lender or Agent would have received
if such Taxes, Other Taxes or Further Taxes had not been imposed.
1. The Company agrees to indemnify and hold harmless each
Lender and the Agent for the full amount of Taxes, Other Taxes and Further
Taxes in the amount that such Lender or the Agent specifies as necessary to
preserve the after-tax yield such Lender would have received if such Taxes,
Other Taxes or Further Taxes had not been imposed, and any liability (including
penalties, interest, additions to tax and reasonable expenses) arising
therefrom or with respect thereto, whether or not such Taxes, Other Taxes or
Further Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the Company
receives written demand therefor from such Lender or the Agent.
1. Within 30 days after the date of any payment by the
Company of Taxes, Other Taxes or Further Taxes, the Company shall furnish to
each Lender and the Agent the original or a certified copy of a receipt
evidencing payment thereof, or other evidence of payment satisfactory to such
Lender or the Agent.
1. If the Company is required to pay any amount to any
Lender or the Agent pursuant to subsection (b) or (c) of this Section, then
such Lender or the Agent shall use reasonable efforts (consistent with legal
and regulatory restrictions) to change the jurisdiction of its Lending Office
or other relevant office so as to eliminate any such additional payment by the
Company which may thereafter accrue, if such
48
change in the good faith judgment of such Lender or the Agent is not otherwise
disadvantageous to such Lender or the Agent.
1. Illegality. If any Lender determines that the introduction of any
applicable Requirement of Law, or any change in any applicable Requirement of
Law, or in the interpretation or administration of any applicable Requirement
of Law, 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 Offshore Rate Loans in any Applicable Currency, then, on
notice thereof by the Lender to the Company through the Agent, any obligation
of that Lender to make Offshore Rate Loans in such Applicable Currency
(including in respect of any LIBOR Bid Loan as to which the Company has
accepted such Lender's Competitive Bid, but which has not yet been borrowed)
shall be suspended until the Lender notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
1. If a Lender determines that it is unlawful to maintain
any Offshore Rate Loan in any Applicable Currency, the Company shall, upon its
receipt of notice of such fact and demand from such Lender (with a copy to the
Agent), prepay in full such Offshore Rate Loan of such Lender then outstanding,
together with interest accrued thereon and amounts required under Section 3.4,
either on the last day of the Interest Period thereof or, if earlier, on the
date on which such Lender may no longer lawfully continue to maintain such
Offshore Rate Loan. If the Company is required to so prepay any Offshore Rate
Committed Loan, then concurrently with such prepayment, the Company shall
borrow from the affected Lender, in the amount of such repayment, a Base Rate
Committed Loan.
1. If the obligation of any Lender to make or maintain
Offshore Rate Committed Loans has been so terminated or suspended, all Loans
which would otherwise be made by such Lender as Offshore Rate Committed Loans
shall be instead Base Rate Committed Loans.
1. Before giving any notice to the Agent or demand upon
the Company under this Section, the affected Lender shall designate a
different Lending Office with respect to its Offshore Rate Loans if such
designation will avoid the need for giving such notice or making such demand
and will not, in the good faith judgment of the Lender, be illegal in any
respect or otherwise disadvantageous to the Lender.
1. Increased Costs and Reduction of Return. If after the date hereof
any Lender determines 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 Offshore Rate) in or in the
interpretation of any law or regulation or (ii) the compliance by that Lender
with any guideline or request 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 such Lender of agreeing to make or making, funding or
maintaining any Offshore Rate Loan or of participating in any BA or, in the
case of the
49
Accepting Lender, of agreeing to accept or accepting BAs, then the Company
shall be liable for, and shall from time to time, upon demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account of such
Lender, additional amounts as are sufficient to compensate such Lender for such
increased costs.
1. If after the date hereof any Lender shall have
determined that (i) the introduction of any Capital Adequacy Regulation, (ii)
any change in any Capital Adequacy Regulation, (iii) any change 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 the Lender (or its Lending
Office) or any corporation controlling the Lender with any Capital Adequacy
Regulation, affects or would affect the amount of capital required or expected
to be maintained by the Lender or any corporation controlling the Lender and
(taking into consideration such Lender's or such corporation's policies with
respect to capital adequacy and such Lender's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitment, loans, credits or obligations under this Agreement, then, upon
demand of such Lender to the Company through the Agent, the Company shall pay
to the Lender, from time to time as specified by the Lender, additional amounts
sufficient to compensate the Lender for such increase.
1. Notwithstanding the foregoing Section 3.3(a) and (b), if any
Lender fails to notify the Company of any event which will entitle such Lender
to compensation pursuant to this Section 3.3 within 180 days after such Lender
obtains knowledge of such event, then such Lender shall not be entitled to any
compensation from the Company for any such increased cost or reduction of
return arising prior to the date which is 180 days before the date on which
such Lender notifies the Company of such event.
A. Funding Losses. The Company shall reimburse each Lender and hold
each Lender harmless from any loss or reasonable expense which the Lender
may sustain or incur as a consequence of:
1. the failure of the Company to make on a timely basis
any payment of principal of any Offshore Rate Loan;
1. the failure of the Company to borrow, continue or
convert a Loan after the Company has given (or is deemed to have given) a
Notice of Borrowing, a Notice of Conversion/ Continuation or accepted a
Competitive Bid;
1. the failure of the Company to make any prepayment of a
Committed Loan in accordance with any notice delivered under Section 2.8;
1. the prepayment or other payment (including after
acceleration thereof) of an Offshore Rate Loan on a day that is not the last
day of the relevant Interest Period; or
50
1. the automatic conversion under Section 2.4 of any
Offshore Rate Committed Loan to a Base Rate Committed Loan on a day that is not
the last day of the relevant Interest Period;
including any such loss or reasonable expense arising from the liquidation or
reemployment of funds obtained by it to maintain its Offshore Rate Loans or
from fees payable to terminate the deposits from which such funds were obtained
or from changes relating to any Offshore Currency Loans. For purposes of
calculating amounts payable by the Company to the Lenders under this Section
and under subsection 3.3(a), each Offshore 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 Offshore Rate used in determining the
interest rate for such Offshore 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 Offshore Rate Loan is in fact so funded.
A. Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the Offshore
Rate for any requested Interest Period with respect to a proposed Offshore Rate
Loan, or any Lender determines that the Offshore Rate applicable pursuant to
subsection 2.12(a) for any requested Interest Period with respect to a proposed
Offshore Rate Loan does not adequately and fairly reflect the cost to such
Lender of funding such Loan, the Agent will promptly so notify the Company and
each Lender. Thereafter, the obligation of the Lenders to make or maintain
Offshore Rate Committed Loans hereunder shall be suspended until the Agent
revokes such notice in writing. Upon receipt of such notice, the Company may
revoke any Notice of Committed Borrowing or Notice of Conversion/Continuation
then submitted by it. If the Company does not revoke such Notice, the Lenders
shall make, convert or continue the Committed Loans, as proposed by the
Company, in the amount specified in the applicable notice submitted by the
Company, but such Loans shall be made, converted or continued as Base Rate
Committed Loans instead of Offshore Rate Committed Loans.
In the case of any Offshore Currency Loans, the Borrowing or continuation
shall be in an aggregate amount equal to the Dollar Equivalent amount of the
originally requested Borrowing or continuation in the Offshore Currency, and to
that end any outstanding Offshore Currency Loans which are the subject of any
continuation shall be redenominated and converted into Base Rate Loans in
Dollars with effect from the last day of the Interest Period with respect to
such Offshore Currency Loans.
A. Reserves on Offshore Rate Loans. The Company shall pay to each
Lender, as long as such Lender shall be required under regulations of the FRB
to maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities") and, in respect of any Offshore Currency Loans, under any
applicable regulations of the relevant Governmental Authority in the country in
which the Offshore Currency of such Offshore Currency Loan
51
circulates, additional costs on the unpaid principal amount of each Offshore
Rate Committed Loan and Offshore Currency Loan equal to the actual costs of
such reserves allocated to such Loan by such Lender (as determined by such
Lender in good faith, which determination shall be conclusive), payable on each
date on which interest is payable on such Loan, provided the Company shall have
received at least 15 days' prior written notice (with a copy to the Agent) of
the amount of such additional interest from such Lender. If a Lender fails to
give notice 15 days prior to the relevant Interest Payment Date, such
additional interest shall be payable 15 days from receipt of such notice.
A. Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article III shall deliver to the Company (with a copy
to the Agent) a certificate setting forth in reasonable detail the amount
payable to the Lender hereunder and such certificate shall be conclusive and
binding on the Company in the absence of manifest error.
A. Substitution of Lenders. Upon the receipt by the Company from any
Lender (an "Affected Lender") of a claim for compensation under Section 3.1 or
3.3 or a notice pursuant to Section 3.2 (which claim or notice results from
circumstances applicable to such Lender and not Lenders generally) the Company
may: (i) request the Affected Lender to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Company to
acquire and assume all or a ratable part of all of such Affected Lender's Loans
and Commitment (a "Replacement Lender"); (ii) request one more of the other
Lenders to acquire and assume all or part of such Affected Lender's Loans and
Commitment; or (iii) designate a Replacement Lender. Any such designation of a
Replacement Lender under clause (i) or (iii) shall be subject to the prior
written consent of the Agent, the Swing Line Lender and the Accepting Lender
(which consents shall not be unreasonably withheld).
A. Survival. The agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
52
I. ARTICLE
CONDITIONS PRECEDENT
A. Conditions to Initial Credit Extensions. The obligation of each
Lender to make its initial Credit Extension is, in addition to the conditions
precedent set forth in Section 4.2, subject to the conditions that (i) the
Agent shall have received evidence that all obligations under the Existing
Credit Agreements have been (or concurrently will be) paid in full and all
commitments under such Agreements have been (or concurrently will be)
terminated, (ii) the Merger shall have been completed substantially in
accordance with the terms of the Merger Agreement and the surviving corporation
shall have changed its name to TruServ Corporation, (iii) the Prudential
Agreement shall have been amended pursuant to an amendment substantially in the
form provided to the Lenders on June 18, 1997 and (iv) the Agent shall have
received all of the following, in form and substance satisfactory to the Agent
and each Lender, and in sufficient copies for each Lender:
1. Credit Agreement and Notes. This Agreement and the
Notes executed by each party thereto.
1. Resolutions; Incumbency; Certificate of Incorporation;
By-Laws.
a) Copies of the resolutions of the board of directors of
the Company authorizing the transactions contemplated hereby, certified
as of the Closing Date by the Secretary or an Assistant Secretary of the
Company;
a) a certificate of the Secretary or Assistant Secretary
of the Company certifying the names and true signatures of the officers
of the Company authorized to execute and deliver this Agreement and all
other Loan Documents to be delivered by it hereunder; and
a) copies of the certificate of incorporation and by-laws
of the Company, certified by the Secretary or an Assistant Secretary of the
Company.
1. Good Standing. A copy of a good standing certificate
as of a recent date for the Company from the Secretary of State (or similar,
applicable Governmental Authority) of its state of incorporation.
1. Legal Opinion. An opinion of counsel to the Company,
substantially in the form of Exhibit F.
1. Payment of Fees. Evidence of payment by the Company of
all accrued and unpaid fees, costs and reasonable expenses to the extent then
due and
53
payable on the Closing Date, together with Attorney Costs of the Agent to the
extent invoiced prior to or on the Closing Date, plus such additional amounts
of Attorney Costs as shall constitute the Agent's reasonable estimate of
Attorney Costs incurred or to be incurred by it through the closing proceedings
(provided that such estimate shall not thereafter preclude final settling of
accounts between the Company and the Agent), including any such costs, fees and
reasonable expenses arising under or referenced in Sections 2.13 and 10.4.
1. Certificate. A certificate signed by a Responsible
Officer, dated as of the Closing Date, stating that:
a) the representations and warranties contained in Article
V are true and correct on and as of such date, as though made on and as
of such date;
a) no Event of Default or Unmatured Event of Default
exists or would result from the initial Credit Extension; and
a) since June 30, 1996, no event or circumstance has
occurred that has resulted or could reasonably be expected to result in a
Material Adverse Effect.
1. Other Documents. Such other approvals, opinions,
documents or materials as the Agent or any Lender may request.
A. Conditions to All Credit Extensions. The obligation of each Lender
to make any Credit Extension to be made by it (or any Bid Loan as to which the
Company has accepted the relevant Competitive Bid) is subject to the
satisfaction of the following conditions precedent on the date of such Credit
Extension:
1. Notice. The Agent (and, in the case of a Swing Line
Loan, the Swing Line Lender) shall have received a Notice of Borrowing or the
Agent and the Accepting Lender shall have received a request for acceptance of
a BA.
1. Continuation of Representations and Warranties. The
representations and warranties in Article V shall be true and correct on and as
of the date of such Credit Extension with the same effect as if made on and as
of such date (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they shall be true and
correct as of such earlier date).
1. No Existing Default. No Event of Default or Unmatured
Event of Default shall exist or shall result from such Borrowing.
Each Notice of Borrowing, Competitive Bid Request and request for acceptance of
a BA submitted by the Company hereunder shall constitute a representation and
warranty by
54
the Company that, as of the date of such notice or request and as of the date
of the applicable Credit Extension, the conditions in this Section 4.2 are
satisfied.
I. ARTICLE
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Lender as
follows (it being understood that, to the extent that any such representation
and warranty relates, in whole or in part, to any period prior to the effective
date of the Merger, (i) references to the "Company" shall mean each of ▇▇▇▇▇▇
and Servistar and (ii) references to any "Subsidiary" shall mean a Subsidiary
of ▇▇▇▇▇▇ and/or of Servistar):
A. Organization; Subsidiary Preferred Stock. The Company is a
corporation duly organized and existing in good standing under the laws of the
State of incorporation, each Subsidiary is duly organized and existing in good
standing under the laws of the jurisdiction in which it is incorporated, and
the Company has and each Subsidiary has the corporate power to own its
respective property and to carry on its respective business as now being
conducted. No Subsidiary has outstanding any shares of stock of a class which
has priority over any other class as to dividends or in liquidation.
A. Financial Statements. The Company has furnished each Lender with the
following financial statements, identified by a principal financial officer of
the Company: (i) a consolidated balance sheet of the Company and its
Subsidiaries as at fiscal year end in each of the three fiscal years of the
Company most recently completed prior to the date as of which this
representation is made or repeated to such Lender (other than fiscal years
completed within 90 days prior to such date for which audited financial
statements have not been released) and consolidated statements of operations
and cash flows and a consolidated statement of capital stock and retained
earnings of the Company and its Subsidiaries for each such year, all reported
on by Ernst & Young (or any other independent public accounting firm of
recognized national standing) and (ii) a consolidated balance sheet of the
Company and its Subsidiaries as at the end of the quarterly period (if any)
most recently completed prior to such date and after the end of such fiscal
year (other than quarterly periods completed within 60 days prior to such date
for which financial statements have not been released) and the comparable
quarterly period in the preceding fiscal year and consolidated statements of
operations and cash flows and a consolidated statement of capital stock and
retained earnings for the periods from the beginning of the fiscal years in
which such quarterly periods are included to the end of such quarterly periods,
prepared by the Company. Such financial statements (including any related
schedules and/or notes) are true and correct in all material respects (subject,
as to interim statements, to changes resulting from audits and year-end
adjustments), have been prepared in accordance with GAAP consistently followed
throughout the periods involved and show all liabilities, direct and
contingent, of the
55
Company and its Subsidiaries required to be shown in accordance with such
principles. The balance sheets fairly present the condition of the Company and
its Subsidiaries as at the dates thereof, and the statements of operations,
capital stock and retained earnings and cash flows fairly present the results
of the operations of the Company and its Subsidiaries and their cash flows for
the periods indicated. There has been no material adverse change in the
business, property or assets, condition (financial or otherwise), operations or
prospects of the Company and its Subsidiaries taken as a whole since the end of
the most recent fiscal year for which such audited financial statements have
been furnished.
A. Actions Pending. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries, or any properties or rights of the Company
or any of its Subsidiaries, by or before any court, arbitrator or
administrative or governmental body which could be reasonably expected to
result in any material adverse change in the business, property or assets,
condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole or the ability of the Company to perform its
obligations under this Agreement.
A. Outstanding Debt. Neither the Company nor any of its Subsidiaries
has outstanding any Debt except as permitted by Section 7.3. There exists no
default under the provisions of any instrument evidencing Debt of the Company
or any of its Subsidiaries in an amount greater than $250,000 or of any
agreement relating thereto.
A. Title to Properties. The Company has and each of its Subsidiaries
has good and indefeasible title to its respective real properties (other than
properties which it leases) and good title to all of its other respective
properties and assets, including the properties and assets reflected in the
most recent audited balance sheet referred to in Section 5.2 (other than
properties and assets disposed of in the ordinary course of business), subject
to no Lien of any kind except Liens permitted by Section 7.2. All leases
necessary in any material respect for the conduct of the respective businesses
of the Company and its Subsidiaries are valid and subsisting and are in full
force and effect.
A. Taxes. The Company has and each of its Subsidiaries has filed all
federal, state and other income tax returns which, to the best knowledge of the
officers of the Company and its Subsidiaries, are required to be filed, and
each has paid all taxes as shown on such returns and on all assessments
received by it to the extent that such taxes have become due, except such taxes
(i) as are being contested in good faith by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP or (ii) the
non-payment of which (a) could not be reasonably expected to have a material
adverse effect on the business, condition (financial or otherwise) or
operations of the Company and its Subsidiaries taken as a whole and (b) does
not result in the creation of any Lien other than Liens permitted by Section
7.2.
56
A. Conflicting Agreements and Other Matters. Neither the Company nor
any of its Subsidiaries is a party to any contract or agreement or subject to
any charter or other corporate restriction which materially and adversely
affects its business, property or assets, condition (financial or otherwise) or
operations. None of the execution and delivery of this Agreement or any other
Loan Document, the making of the Loans, the creation of the BAs or the
fulfillment of or compliance with the terms and provisions hereof and of the
other Loan Documents will conflict with, or result in a breach of the terms,
conditions or provisions of, or constitute a default under, or result in any
violation of, or result in the creation of any Lien upon any of the properties
or assets of the Company or any of its Subsidiaries pursuant to, the charter or
by-laws of the Company or any of its Subsidiaries, any award of any arbitrator
or any agreement (including any agreement with stockholders), instrument,
order, judgment, decree, statute, law, rule or regulation to which the Company
or any of its Subsidiaries is subject. Neither the Company nor any of its
Subsidiaries is a party to, or otherwise subject to any provision contained in,
any instrument evidencing Indebtedness of the Company or such Subsidiary, any
agreement relating thereto or any other contract or agreement (including its
charter) which limits the amount of, or otherwise imposes restrictions on the
incurring of, Debt of the Company of the type that the Obligations constitute
except as set forth in the agreements listed in Schedule 5.7 attached hereto
(as such Schedule 5.7 may have been modified from time to time by written
supplements thereto delivered by the Company and accepted in writing by the
Required Lenders).
A. Use of Proceeds. None of the proceeds of any Loan or BA will be
used, directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any "margin stock" as defined in Regulation
U of the Board of Governors of the Federal Reserve System (herein called
"margin stock") or for the purpose of maintaining, reducing or retiring any
Indebtedness which was originally incurred to purchase or carry any stock that
is then currently a margin stock or for any other purpose which might
constitute the transactions contemplated hereby a "purpose credit" within the
meaning of such Regulation U, unless the Company shall have delivered to the
Lenders, on the date of borrowing of such Loan or the acceptance of such BA, an
opinion of counsel satisfactory to the Lenders stating that the making of such
Loan or the acceptance of such BA does not constitute a violation of such
Regulation U. Neither the Company nor any agent acting on its behalf has taken
or will take any action which might cause this Agreement or the Loans or the
BAs to violate Regulation G, Regulation T, Regulation U or any other regulation
of the Board of Governors of the Federal Reserve System or to violate the
Exchange Act, in each case as in effect now or as the same may hereafter be in
effect.
A. ERISA. No accumulated funding deficiency (as defined in section 302
of ERISA and section 412 of the Code), whether or not waived, exists with
respect to any Plan (other than a Multiemployer Plan). No liability to the
PBGC has been or is expected by the Company or any ERISA Affiliate to be
incurred with respect to any Plan (other than a Multiemployer Plan) by the
Company, any Subsidiary or any ERISA Affiliate which is or would be materially
adverse to the business, property or assets,
57
condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole. Neither the Company, any Subsidiary nor any
ERISA Affiliate has incurred or presently expects to incur any withdrawal
liability under Title IV of ERISA with respect to any Multiemployer Plan which
is or would be materially adverse to the business, property or assets,
condition (financial or otherwise) or operations of the Company and its
Subsidiaries taken as a whole. The execution and delivery of this Agreement
and the making of Loans and the creation and acceptance of the BAs will be
exempt from or will not involve any transaction which is subject to the
prohibitions of section 406 of ERISA and will not involve any transaction in
connection with which a penalty could be imposed under section 502(i) of ERISA
or a tax could be imposed pursuant to section 4975 of the Code.
A. Governmental Consent. Neither the nature of the Company or of any
Subsidiary, nor any of their respective businesses or properties, nor any
relationship between the Company or any Subsidiary and any other Person, nor
any circumstance in connection with the making of the Loans is such as to
require any authorization, consent, approval, exemption or any action by or
notice to or filing with any court or administrative or governmental body
(other than routine filings after the Closing Date with the Securities and
Exchange Commission and/or state Blue Sky authorities) in connection with the
execution and delivery of this Agreement, the making of the Loans, the creation
and acceptance of the BAs or the fulfillment of or compliance with the terms
and provisions of the Loan Documents.
A. Environmental Compliance. The Company and its Subsidiaries and all
of their respective properties and facilities have complied at all times and in
all respects with all applicable foreign, federal, state, local and regional
statutes, laws, ordinances and judicial or administrative orders, judgments,
rulings and regulations relating to protection of the environment except, in
any such case, where failure to so comply could not reasonably be expected to
result in a material adverse effect on the business, condition (financial or
otherwise) or operations of the Company and its Subsidiaries taken as a whole
or the ability of the Company to perform its obligations under this Agreement.
A. Disclosure. Neither this Agreement nor any other document,
certificate or statement furnished to the Agent or any Lender by or on behalf
of the Company in connection herewith contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein not misleading. There is no fact
peculiar to the Company or any of its Subsidiaries which materially adversely
affects or in the future may (so far as the Company can now foresee) materially
adversely affect the business, property or assets, condition (financial or
otherwise) or operations of the Company or any of its Subsidiaries and which
has not been set forth in this Agreement.
A. Hostile Tender Offers. None of the proceeds of any Loans or the
BAs will be used to finance a Hostile Tender Offer.
58
A. Priority of Obligations. The Obligations constitute "Superior
Indebtedness" as such term is defined in the Company's Promissory
(subordinated) Notes, the form of which is attached hereto as Exhibit I and the
Subordinated Debt is subordinated to the Obligations.
A. Merger, etc.
(a) The Merger will be consummated substantially in accordance with the
terms of the Merger Agreement.
(b) The Merger will comply in all material respects with all applicable
legal requirements, and all necessary governmental, regulatory, shareholder and
other consents and approvals required for the consummation of the Merger have
been, or prior to the consummation thereof will be, duly obtained.
(c) The execution and delivery of the Merger Agreement, and the
consummation of the Merger, will not violate any statute or regulation of the
United States or of any state or other applicable jurisdiction, or any order,
judgment or decree of any court or governmental body, or result in a breach of,
or constitute a default under, any agreement, indenture, order or decree
affecting the Company, Servistar or any of their respective Subsidiaries.
I. ARTICLE
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any BA shall be
outstanding or any Loan or other Obligation shall remain unpaid or unsatisfied,
unless the Required Lenders waive compliance in writing:
A. Financial Statements. The Company shall deliver to the Agent, in
form and detail reasonably satisfactory to the Agent and the Required Lenders,
with sufficient copies for each Lender:
1. as soon as available, but not later than 120 days after the end
of each fiscal year, a copy of the audited consolidated balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Ernst & Young
or another nationally-recognized independent public accounting firm
("Independent Auditor") which report (x) shall state that such consolidated
financial statements present fairly the financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years and (y)
59
shall not be qualified or limited because of a restricted or limited
examination by the Independent Auditor of any material portion of the Company's
or any Subsidiary's records; and
1. as soon as available, but not later than 60 days after the end
of each of the first three fiscal quarters of each fiscal year, a copy of the
unaudited consolidated balance sheet of the Company and its Subsidiaries as of
the end of such quarter and the related consolidated statements of income,
shareholders' equity and cash flows for the period commencing on the first day
and ending on the last day of such quarter, and certified by a Responsible
Officer as fairly presenting, in accordance with GAAP (subject to ordinary,
good faith year-end audit adjustments), the financial position and the results
of operations of the Company and the Subsidiaries.
A. Certificates; Other Information. The Company shall furnish to the
Agent, with sufficient copies for each Lender:
1. concurrently with the delivery of the financial statements
referred to in subsection 6.1(a), a certificate of the Independent Auditor
stating that in making the examination necessary therefor no knowledge was
obtained of any Event of Default or Unmatured Event of Default, except as
specified in such certificate;
1. concurrently with the delivery of the financial statements
referred to in subsections 6.1(a) and (b), a Compliance Certificate executed by
a Responsible Officer;
1. promptly, copies of all financial statements and reports that
the Company sends to its shareholders, and copies of all financial statements
and regular, periodical or special reports (including Forms 10K, 10Q and 8K)
that the Company or any Subsidiary may make to, or file with, the SEC; and
1. promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the Agent,
at the request of any Lender, may from time to time request.
A. Notices. The Company shall promptly notify the Agent and each Lender
promptly after a Responsible Officer obtains knowledge of:
1. the occurrence of any Event of Default or Unmatured Event of
Default;
1. any of the following matters that has resulted or may
reasonably be expected to result in a Material Adverse Effect: (i) any breach
or non-performance of, or any default under, a Contractual Obligation of the
Company or any Subsidiary; (ii) any dispute, litigation, investigation,
proceeding or suspension between the Company or any Subsidiary and any
Governmental Authority; or (iii) the
60
commencement of, or any material development in, any litigation or proceeding
affecting the Company or any Subsidiary including pursuant to any applicable
Environmental Law;
1. the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event more than 10 days after such
event; provided that the Company shall notify the Agent and each Lender not
less than ten days before the occurrence of any event described in clause (ii)
below), and deliver to the Agent and each Lender a copy of any notice with
respect to such event that is filed with a Governmental Authority and any
notice delivered by a Governmental Authority to the Company or any ERISA
Affiliate with respect to such event:
a) an ERISA Event;
a) a contribution failure with respect to a Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA;
a) a material increase in the Unfunded Pension Liability of any
Pension Plan;
a) the adoption of, or the commencement of contributions to, any
Plan subject to Section 412 of the Code by the Company or any ERISA
Affiliate; or
a) the adoption of any amendment to a Plan subject to Section 412
of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability; and
1. any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary proposes to take with respect thereto and at what time. Each
notice under subsection 6.3(a) shall describe with particularity any and all
clauses or provisions of this Agreement or any other Loan Document that have
been breached or violated.
A. Preservation of Corporate Existence, Etc. The Company shall, and
shall cause each Subsidiary to:
1. preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation;
1. preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
61
or desirable in the normal conduct of its business except (i) in connection
with transactions permitted by Section 7.6 and sales of assets permitted by
Section 7.5 and (ii) to the extent the non-preservation or non-maintenance
thereof could not reasonably be expected to have a Material Adverse Effect;
1. use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
1. preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably
be expected to have a Material Adverse Effect.
A. Maintenance of Property. The Company shall, and shall cause each
Subsidiary to, maintain and preserve all its property which is used or useful
in its business in good working order and condition, ordinary wear and tear
excepted and make all necessary repairs thereto and renewals and replacements
thereof except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect. The Company and each Subsidiary shall use the
standard of care typical in the industry in the operation and maintenance of
its facilities.
A. Insurance. The Company shall, and shall cause each Subsidiary to,
maintain with financially sound and reputable insurers, insurance in such
amounts and against such liabilities and hazards as customarily maintained by
the Company in accordance with its practices, policies and procedures prior to
the Closing Date. Together with each delivery of financial statements under
subsection 6.1(a), the Company will, upon the request of any Lender,
deliver a certificate of a Responsible Officer specifying the details of such
insurance in effect.
A. Payment of Obligations. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable all
their respective obligations and liabilities, including:
1. all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by the Company or such Subsidiary;
1. all lawful claims which, if unpaid, would by law become a Lien
upon its property; and
1. all indebtedness, as and when due and payable, but subject to
any subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
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A. Compliance with Laws. The Company shall, and shall cause each
Subsidiary to, comply in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
B. Compliance with ERISA. The Company shall, and shall cause each of
its ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; and (c) make all required contributions to
any Plan subject to Section 412 of the Code.
A. Inspection of Property and Books and Records. The Company shall,
and shall cause each Subsidiary to, maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall, and shall cause each Subsidiary to, permit representatives and
independent contractors of the Agent or any Lender to visit and inspect any of
their respective properties, to examine their respective corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the reasonable
expense of the Company and at such reasonable times during normal business
hours and as often as may be reasonably desired, upon reasonable advance notice
to the Company; provided that when an Event of Default exists the Agent or any
Lender may do any of the foregoing at the reasonable expense of the Company at
any time during normal business hours without advance notice.
A. Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
material compliance with all material Environmental Laws.
A. Use of Proceeds. The Company shall use the proceeds of the Loans and
the BAs to repay Debt and for working capital and other general corporate
purposes not in contravention of any applicable Requirement of Law or of any
Loan Document.
A. Covenant to Secure Obligations Equally. The Company covenants that,
if it or any Subsidiary shall create or assume any Lien upon any of its
property or assets, whether now owned or hereafter acquired, other than Liens
permitted by the provisions of Section 7.2 (unless prior written consent to the
creation or assumption thereof shall have been obtained pursuant to Section
10.1), it will make or cause to be made effective provision whereby the
Obligations will be secured by such Lien equally and ratably with any and all
other Debt thereby secured so long as any such other Debt shall be so secured.
A. Cooperative Status. The Company covenants that it will at all times
maintain its status as a cooperative for purposes of Subchapter T of the Code;
provided,
63
however, in the event that the Code or other applicable law is
modified after the date hereof and as a result of such modification the Company
is unable to satisfy its obligations under this Section, then the Required
Lenders and the Company shall agree, or in good faith negotiate to agree, to
amend the covenants contained in this Agreement so that the application of such
covenants (following such modification of the Code or other applicable law and
the effect thereof on the Company) will be substantially the same as prior
thereto.
I. ARTICLE
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any BA shall be
outstanding or any Loan or other Obligation shall remain unpaid or unsatisfied,
unless the Required Lenders waive compliance in writing:
A. Fixed Charge Coverage Ratio. The Company will not permit the Fixed
Charge Coverage Ratio to be less than 1.50 to 1.00, in each case determined at
the end of each fiscal quarter for the four consecutive fiscal quarter period
then ending.
A. Lien Restrictions. The Company will not and will not permit any
Subsidiary to create, assume or suffer to exist any Lien upon any of its
property or assets, whether now owned or hereafter acquired (whether or not
provision is made for the equal and ratable securing of the Obligations in
accordance with the provisions of Section 6.13), except:
1. Liens for taxes not yet due or which are being actively contested
in good faith by appropriate proceedings,
1. Liens incidental to the conduct of its business or the ownership of
its property and assets which were not incurred in connection with the
borrowing of money or the obtaining of advances or credit,
1. Liens on property or assets of a Subsidiary to secure obligations of
such Subsidiary to the Company or another Subsidiary,
1. Liens in existence on the Closing Date and described on Schedule
7.2,
1. Liens in respect of capital leases entered into in connection
with, or any Lien arising in connection with, the acquisition of property,
after the date hereof and attaching only to the property being acquired,
if the Indebtedness secured thereby does not exceed 100% of the lesser of
(i) the fair market value of the property acquired at the time of
acquisition thereof and (ii) the total purchase price of the property so
acquired, and
64
1. other Liens (including Liens arising under capital leases), in
addition to the Liens permitted by clauses (a) through (d) above,
securing Indebtedness of the Company or any Subsidiary (other than
Indebtedness that constitutes Subordinated Debt); provided, however, that
(i) such Indebtedness is permitted by the provisions of Section 7.3 and
(ii) the aggregate outstanding principal amount of all such Indebtedness
does not at any time exceed an amount equal to ten percent (10%) of the
consolidated total assets of the Company.
B. Debt Restrictions. The Company will not and will not permit any
Subsidiary to create, incur, assume or suffer to exist any Debt, except:
1. Senior Funded Debt in existence as of the Closing Date,
1. Subordinated Debt,
1. Senior Funded Debt (including any Short Term Debt to be included in
the computation of Senior Funded Debt pursuant to clause (e) below) of
the Company, so long as the aggregate principal amount of all
consolidated Senior Funded Debt does not exceed at any time an amount
equal to fifty percent (50%) of Consolidated Capitalization, and
1. Short Term Debt of the Company, provided that there shall have
been a period of at least thirty (30) consecutive days within the twelve
month period immediately preceding the date of determination during which
the aggregate principal amount of Short Term Debt of the Company
outstanding as of the close of business on any day during such twelve
month period did not exceed an amount equal to the amount of Funded Debt
which would have been permitted as additional Funded Debt under clause (d)
of this Section 7.3 as of the close of business on such day, and provided
further that an amount equal to the largest balance of such Short Term
Debt outstanding on any day of such 30-day period shall be included in all
computations of Senior Funded Debt under clause (d) above until such Short
Term Debt has been repaid in full, and
1. Debt under the Existing Credit Agreements which will be repaid
prior to or concurrently with the making of the initial Credit Extensions
hereunder.
For purposes of this Section 7.3, Debt represented by the Loans or arising
under the BAs shall be considered Short Term Debt.
A. Sale of Assets. The Company will not and will not permit any
Subsidiary to sell, lease or transfer or otherwise dispose of any assets of the
Company or any Subsidiary other than in the ordinary course of business (which
shall be deemed to include the planned sale of up to eight distribution
facilities); provided that the Company and its Subsidiaries may sell, lease,
transfer or otherwise dispose of assets outside the
65
ordinary course of business so long as the aggregate amount of all assets sold,
leased, transferred or otherwise disposed of outside the ordinary course of
business during the most recent 36-month rolling period when added together,
without duplication, with (a) any shares of stock or Debt of any Subsidiary
sold or otherwise disposed of, or with respect to which the Company or any
Subsidiary has parted control of, except to the Company or another Subsidiary,
during such period and (b) any assets then proposed to be sold outside of the
ordinary course of business do not constitute more than 10% of the consolidated
total assets of the Company as of the end of the most recent fiscal quarter for
which the Company has delivered financial statements pursuant to Section 6.1.
A. Merger. The Company will not and will not permit any Subsidiary to
merge or consolidate with any other Person, except that Subsidiaries may be
merged into the Company or any other Subsidiary and the Company may merge with
another Person (including pursuant to the Merger), provided that the Company is
the surviving corporation and no Event of Default or Default shall exist either
immediately before or after such merger.
A. Restrictions on Transactions with Affiliates and Stockholders. The
Company will not and will not permit any Subsidiary to directly or indirectly,
purchase, acquire or lease any property from, or sell, transfer or lease any
property (other than shares of stock of the Company) to, or otherwise deal with
(i) any Affiliate or Substantial Stockholder, or (ii) any corporation in which
an Affiliate, Substantial Stockholder or the Company (either directly or
through Subsidiaries) owns 5% or more of the outstanding voting stock, except
that (a) any such Affiliate or Substantial Stockholder may be a director,
officer or employee of the Company or any Subsidiary and may be paid reasonable
compensation in connection therewith (b) the Company and its Subsidiaries may
perform or engage in any of the foregoing in the ordinary course of business
upon terms no less favorable to the Company or such Subsidiary (as the case may
be) than if no such relationship described in clauses (i) and (ii) above
existed and (c) the Company may sell to or purchase from any such Person shares
of the Company's stock subject to the provisions of Section 7.11.
A. Issuance of Stock by Subsidiaries. The Company will not permit any
Subsidiary to (either directly, or indirectly by the issuance of rights or
options for, or securities convertible into, such shares) issue, sell or
otherwise dispose of any shares of any class of its stock (other than
directors' qualifying shares) except to the Company or another Subsidiary;
provided, however, ▇▇▇▇▇▇ Canada Hardware may issue and sell shares of its
stock in the ordinary course of business consistent with its practices as of
April 13, 1992.
A. Compliance with ERISA. The Company will not and will not permit any
Subsidiary to engage in any transaction in connection with which the Company or
any Subsidiary could be subject to either a civil penalty assessed pursuant to
section 502(i) of ERISA or a tax imposed by section 4975 of the Code, terminate
or withdraw from any Plan (other than a Multiemployer Plan) in a manner, or
take any other
66
action with respect to any such Plan (including, without limitation, a
substantial cessation of operations within the meaning of section 4062(f) of
ERISA), which could result in any liability of the Company or any Subsidiary to
the PBGC, to a trust established pursuant to section 4041(c)(3)(B)(ii) or (iii)
or 4042(i) of ERISA, or to a trustee appointed under section 4042(b) or (c) of
ERISA, incur any liability to the PBGC on account of a termination of a Plan
under section 4064 of ERISA, fail to make full payment when due of all amounts
which, under the provisions of any Plan, the Company or any Subsidiary is
required to pay as contributions thereto, or permit to exist any accumulated
funding deficiency, whether or not waived, with respect to any Plan (other than
a Multiemployer Plan), if, in any such case, such penalty or tax or such
liability, or the failure to make such payment, or the existence of such
deficiency, as the case may be, could be reasonably expected to have a material
adverse effect on the Company and its Subsidiaries taken as a whole.
A. No Change in Subordination Terms, etc. The Company will not and
will not permit any Subsidiary to amend, alter or otherwise change any
provision of any of the subordinated promissory notes now or hereafter issued
by the Company or take any other action (or refrain from taking an action)
which would have the effect of eliminating or altering in any way the effect of
the subordination language appearing in such subordinated promissory notes or
the rights of the Agent and the Lenders arising as a result thereof.
A. Nature of Business. The Company will not and will not permit any
Subsidiary to engage in the business of underwriting risks for insurance
purposes, or in any other aspect of insurance related business other than in
the ordinary course of business in accordance with its practices as of the
Closing Date; or purchase and sell real estate (other than on an agency basis)
for purposes other than those relating directly to its principal business
except for purchases and sales of store locations in the ordinary course of
business which in the aggregate for the Company and its Subsidiaries taken as
a whole do not exceed $10,000,000 during any rolling consecutive five year
period.
A. Restricted Investments. The Company will not and will not permit any
Subsidiary to make or permit a Subsidiary to make any Investment except the
Company and any Subsidiary may:
1. make or permit to remain outstanding loans or advances to any
Subsidiary,
1. own, purchase or acquire stock, obligations or securities of a
Subsidiary or of a corporation which immediately after such purchase or
acquisition will be a Subsidiary,
1. acquire and own stock, obligations or securities received in
settlement of debts (created in the ordinary course of business) owing to
the Company or any Subsidiary,
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1. own, purchase or acquire prime commercial paper, banker's
acceptances and certificates of deposit in United States and Canadian
commercial banks (having combined capital and surplus of not less than
U.S. $100,000,000) and repurchase agreements with respect to the
foregoing, in each case due within one year from the date of purchase and
payable in the United States in United States dollars, obligations of the
government of the United States or any agency thereof, and obligations
guaranteed by the government of the United States,
1. make or permit to remain outstanding travel and other similar
advances to officers and employees in the ordinary course of business,
1. permit to remain outstanding Investments existing on the Closing
Date and described on Schedule 7.11, and
1. to the extent applicable, make Investments permitted under Section
7.12 below.
A. Restricted Payments. The Company will not and will not permit any
Subsidiary to pay or declare cash dividends, cash patronage dividends or
dividends on any class of its stock (other than dividends in kind) or redeem,
purchase or otherwise acquire, or make any redemptions, purchase, or other
acquisition of any of its stock or apply miscellaneous deductions in lieu of
patronage dividends, or make or permit any Subsidiary to make any Restricted
Investment (each a "Restricted Payment") except to the extent that the
aggregate amount of all such Restricted Payments made after December 28, 1996
shall not exceed an amount equal to the sum of (i) $25,000,000 plus (ii) 100%
(or minus 100% in the case of a deficit) of Consolidated Net Earnings for the
period (taken as one accounting period) commencing on December 29, 1996 and
terminating at the end of the last fiscal quarter preceding the date of any
proposed Restricted Payment.
A. Use of Proceeds. The Company shall not, and shall not permit any
Subsidiary to, use any portion of the proceeds of any Credit Extension,
directly or indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or
otherwise refinance indebtedness of the Company or others incurred to purchase
or carry Margin Stock, (iii) to extend credit for the purpose of purchasing or
carrying any Margin Stock, or (iv) to acquire any security in any transaction
that is subject to Section 13 or 14 of the Exchange Act.
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I. ARTICLE
EVENTS OF DEFAULT
A. Event of Default. Any of the following events which occur and are
continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise) shall constitute an "Event of Default":
1. The Company defaults in the payment of any principal of any Loan or
any amount due in respect of any BA when the same shall become due.
1. The Company defaults in the payment of any interest, fee or other
amount payable hereunder or under any other Loan Document for more than
three (3) days after the date due.
1. The Company or any Subsidiary defaults (whether as primary
obligor or as guarantor or other surety) in any payment of principal of or
interest on any other obligation for money borrowed (or any Capitalized
Lease Obligation, any obligation under a conditional sale or other title
retention agreement, any obligation issued or assumed as full or partial
payment for property whether or not secured by a purchase money mortgage
or any obligation under notes payable or drafts accepted representing
extensions of credit) beyond any period of grace provided with respect
thereto, or the Company or any Subsidiary fails to perform or observe any
other agreement, term or condition contained in any agreement under which
any obligation is created (or if any other event thereunder or under any
such agreement shall occur and be continuing) and the effect of such
failure or other event is to cause, or to permit the holder or holders of
such obligation (or a trustee on behalf of such holder or holders) to
cause, such obligation to become due (or to be repurchased by the Company
or any Subsidiary) prior to any stated maturity, provided that the
aggregate amount of all obligations as to which such a payment default
shall occur and be continuing or such a failure or other event causing or
permitting acceleration (or resale to the Company or any Subsidiary) shall
occur and be continuing exceeds $5,000,000.
1. Any representation or warranty made by the Company herein or in any
other Loan Document or by the Company or any of its officers in any
writing furnished in connection with or pursuant to this Agreement or any
other Loan Document shall be false in any material respect on the date as
of which made.
1. The Company fails to perform or observe any agreement contained in
Article VIII.
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1. The Company fails to perform or observe any other agreement, term
or condition contained herein and such failure shall not be remedied within
30 days after any Responsible Officer obtains actual knowledge of such
failure.
1. The Company or any Subsidiary makes an assignment for the benefit
of creditors or is generally not paying its debts as such debts become due.
1. Any decree or order for relief in respect of the Company or any
Subsidiary is entered under any bankruptcy, reorganization, compromise,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
or similar law, whether now or hereafter in effect (herein called a
"Bankruptcy Law"), of any jurisdiction.
1. The Company or any Subsidiary petitions or applies to any tribunal
for, or consents to, the appointment of, or taking possession by, a
trustee, receiver, custodian, liquidator or similar official of the
Company or any Subsidiary, or of any substantial part of the assets of the
Company or any Subsidiary, or commences a voluntary case under the
Bankruptcy Law of the United States or any proceedings (other than
proceedings for the voluntary liquidation and dissolution of a Subsidiary)
relating to the Company or any Subsidiary under the Bankruptcy Law of any
other jurisdiction.
1. Any such petition or application is filed, or any such proceedings
are commenced, against the Company or any Subsidiary and the Company or
such Subsidiary by any act indicates its approval thereof, consent thereto
or acquiescence therein, or an order, judgment or decree is entered
appointing any such trustee, receiver, custodian, liquidator or similar
official, or approving the petition in any such proceedings, and such
order, judgment or decree remains unstayed and in effect for more than 30
days.
1. Any order, judgment or decree is entered in any proceedings against
the Company decreeing the dissolution of the Company and such order,
judgment or decree remains unstayed and in effect for more than 60 days.
1. Any order, judgment or decree is entered in any proceedings against
the Company or any Subsidiary decreeing a split-up of the Company or such
Subsidiary which requires the divestiture of assets representing a
substantial part, or the divestiture of the stock of a Subsidiary whose
assets represent a substantial part, of the consolidated assets of the
Company and its Subsidiaries (determined in accordance with GAAP) or
which requires the divestiture of assets, or stock of a Subsidiary, which
shall have contributed a substantial part of the consolidated net income
of the Company and its Subsidiaries (determined in accordance with GAAP)
for any of the three fiscal years then most recently ended, and such
order, judgment or decree remains unstayed and in effect for more than 60
days.
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1. A final judgment in an amount in excess of $7,000,000 is rendered
against the Company or any Subsidiary and, within 60 days after entry
thereof, such judgment is not discharged or execution thereof stayed
pending appeal, or within 60 days after the expiration of any such stay,
such judgment is not discharged.
1. An Event of Default exists under the Prudential Agreement.
A. Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Required Lenders, do any or all of
the following:
1. declare the Commitment of each Lender to make Committed Loans, the
obligation of the Swing Line Lender to make Swing Line Loans and the
obligation of the Accepting Lender to accept BAs to be terminated,
whereupon such Commitments and obligations shall be terminated;
1. declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or
payable hereunder or under any other Loan Document to be immediately due
and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Company;
1. demand that the Company deliver to the Agent for the benefit of the
Accepting Lender and the Lenders cash collateral in an amount equal to
the aggregate maximum amount which may be required to be paid by the
Accepting Lender in connection with all outstanding BAs, whereupon the
Company shall be obligated to deliver such cash collateral; and
1. exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or
applicable law;
provided, however, that upon the occurrence of any event specified in
subsection (g), (h), (i) or (j) of Section 8.1, the obligation of each Lender
to make Loans and of the Accepting Lender to accept BAs shall automatically
terminate and the unpaid principal amount of all outstanding Loans and all
interest and other amounts as aforesaid shall automatically become due and
payable and the Company shall automatically become obligated to the Agent for
the benefit of the Accepting Lender and the Lenders cash collateral in an
amount equal to the aggregate maximum amount which may be required to be paid
by the Accepting Lender in connection with all outstanding BAs, all without
further act of the Agent or any Lender.
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A. Rights Not Exclusive. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
I. ARTICLE
THE AGENT
1. Appointment and Authorization; "Agent". Each Lender hereby
irrevocably (subject to Section 9.9) appoints, designates and authorizes the
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. Notwithstanding any provision to the contrary contained elsewhere in
this Agreement or in any other Loan Document, the Agent shall not have any
duties or responsibilities, except those expressly set forth herein, nor shall
the 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 Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other
implied (or express) obligations arising under agency doctrine of any
applicable law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship
between independent contracting parties.
1. The Accepting Lender shall act on behalf of the Lenders with
respect to any BA accepted by it and the documents associated therewith. The
Accepting Lender shall have all of the benefits and immunities (i) provided to
the Agent in this Article IX with respect to any acts taken or omissions
suffered by the Accepting Lender in connection with BAs accepted by it or
proposed to be accepted by it and the documents and agreements pertaining
thereto as fully as if the term "Agent", as used in this Article IX, included
the Accepting Lender with respect to such acts or omissions and (ii) as
additionally provided in this Agreement with respect to the Accepting Lender.
1. The Swing Line Lender shall have all of the benefits and
immunities (i) provided to the Agent in this Article IX with respect to any
acts taken or omissions suffered by the Swing Line Lender in connection with
Swing Line Loans made or proposed to be made by it as fully as if the term
"Agent", as used in this Article IX, included the Swing Line Lender with
respect to such acts or omissions and (ii) as additionally provided in this
Agreement with respect to the Swing Line Lender.
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A. Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
A. Liability of Agent. None of the 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 or the transactions
contemplated hereby (except for its own gross negligence 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 Company or any
Subsidiary or Affiliate of the Company, 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
Agent under or in connection with, this Agreement or any other Loan Document,
or the validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other Loan Document, or for any failure of the Company or
any other party to any Loan Document to perform its obligations hereunder or
thereunder. No 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 Company or any
of the Company's Subsidiaries or Affiliates.
1. Reliance by Agent. The 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 Company), independent accountants and other experts selected by the
Agent. The 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 Required Lenders (or, if expressly
required hereunder, all 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 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 Required Lenders and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Lenders.
1. For purposes of determining compliance with the conditions
specified in Section 4.1, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Lender for consent,
approval,
73
acceptance or satisfaction, or required thereunder to be consented to or
approved by or acceptable or satisfactory to the Lender.
A. Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Event of Default or Unmatured Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Agent for the account of the Lenders,
unless the Agent shall have received written notice from a Lender or the
Company referring to this Agreement, describing such Event of Default or
Unmatured Event of Default and stating that such notice is a "notice of
default". The Agent will notify the Lenders of its receipt of any such notice.
The Agent shall take such action with respect to such Event of Default or
Unmatured Event of Default as may be requested by the Required Lenders in
accordance with Article VIII; provided, however, that unless and until the
Agent has received any such request, the Agent may (but shall not be obligated
to) take such action, or refrain from taking such action, with respect to such
Event of Default or Unmatured Event of Default as it shall deem advisable or in
the best interest of the Lenders.
A. Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that
no act by the Agent hereinafter taken, including any review of the affairs of
the Company and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to the Agent that it has, independently and without reliance
upon any Agent-Related Person 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 Company and its Subsidiaries, and all applicable bank
regulatory laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to the Company
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person 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 Company.
Except for notices, reports and other documents expressly herein required to be
furnished to the Lenders by the Agent, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Company which may come into the possession
of any of the Agent-Related Persons.
A. Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from and against any and all
74
Indemnified Liabilities; provided, however, that no Lender shall be liable for
the payment to any Agent-Related Person of any portion of the Indemnified
Liabilities resulting solely from such Person's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender shall reimburse
the Agent upon demand for its ratable share of any costs or out-of-pocket
expenses (including Attorney Costs) incurred by the 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 Agent is not reimbursed for such expenses by
or on behalf of the Company. The undertaking in this Section shall survive the
payment of all Obligations hereunder and the resignation or replacement of the
Agent.
A. Agent in Individual Capacity. BofA 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, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BofA were not the Agent, the Accepting
Lender and the Swing Line Lender hereunder, in each case without notice to or
consent of the Lenders. The Lenders acknowledge that, pursuant to such
activities, BofA or its Affiliates may receive information regarding the
Company or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Company or such Subsidiary) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, BofA and any Affiliate thereof
shall have the same rights and powers under this Agreement as any other Lender
and may exercise the same as though BofA were not the Agent, the Accepting
Lender or the Swing Line Lender.
A. Successor Agent. The Agent may, and at the request of the Required
Lenders shall, resign as Agent upon 30 days' notice to the Lenders and the
Company. If the Agent resigns under this Agreement, the Required Lenders
(with, if no Event of Default and Unmatured Event of Default then exists, the
consent of the Company, not to be unreasonably withheld) shall appoint from
among the Lenders a successor agent for the Lenders. If no successor agent is
appointed prior to the effective date of the resignation of the Agent, the
Agent may appoint, after consulting with the Lenders and the Company, a
successor agent from among the Lenders. Upon the acceptance of its appointment
as successor agent hereunder, such successor agent shall succeed to all the
rights, powers and duties of the retiring Agent and the term "Agent" shall mean
such successor agent and the retiring Agent's appointment, powers and duties as
Agent shall be terminated. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article IX and Sections 10.4 and 10.5 shall inure
to its benefit as to any actions taken or omitted to be taken by it while it
was Agent under this Agreement. If no successor agent has accepted appointment
as Agent by the date which is 30 days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of the Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as
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provided for above. Notwithstanding the foregoing, however, BofA may not be
removed as the Agent at the request of the Required Lenders unless BofA or any
Affiliate of BofA shall also simultaneously be replaced as "Accepting Lender"
and as "Swing Line Lender" hereunder pursuant to documentation in form and
substance reasonably satisfactory to BofA and, if applicable, such Affiliate.
1. Withholding Tax. If any Lender is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Lender claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Lender agrees with and in favor of the Agent, to deliver
to the Agent:
a) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, properly completed IRS
Forms 1001 and W-8 before the payment of any interest in the first
calendar year and before the payment of any interest in each third
succeeding calendar year during which interest may be paid under this
Agreement;
a) if such Lender claims that interest paid under this Agreement is
exempt from United States withholding tax because it is effectively
connected with a United States trade or business of such Lender, two
properly completed and executed copies of IRS Form 4224 before the
payment of any interest is due in the first taxable year of such Lender
and in each succeeding taxable year of such Lender during which interest
may be paid under this Agreement, and IRS Form W-9; and
a) such other form or forms as may be required under the Code or
other laws of the United States as a condition to exemption from, or
reduction of, United States withholding tax.
Each such Lender agrees to promptly notify the Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
1. If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of the Company to such Lender, such Lender
agrees to notify the Agent of the percentage amount in which it is no longer
the beneficial owner of Obligations of the Company to such Lender. To the
extent of such percentage amount, the Agent will treat such Lender's IRS Form
1001 as no longer valid.
1. If any Lender claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company to such Lender, such Lender agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.
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1. If any Lender is entitled to a reduction in the applicable with
holding tax, the Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable withholding tax after taking into account
such reduction. If the forms or other documentation required by subsection (a)
of this Section are not delivered to the Agent, then the Agent may withhold
from any interest payment to such Lender not providing such forms or other
documentation an amount equivalent to the applicable withholding tax.
1. If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered or was not properly executed, or because
such Lender failed to notify the 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 Agent fully for all
amounts paid, directly or indirectly, by the Agent as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to the Agent under this Section, together
with all costs and expenses (including Attorney Costs). The obligation of the
Lenders under this subsection shall survive the payment of all Obligations and
the resignation or replacement of the Agent.
A. Co-Agents. None of the Lenders identified on the signature pages of
this Agreement or any related document as a "co-agent" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than those applicable to all Lenders as such. Without limiting the foregoing,
none of the Lenders so identified as a "co-agent" shall have or be deemed to
have any fiduciary relationship with any Lender. Each Lender acknowledges that
it has not relied, and will not rely, on any of the Lenders so identified in
deciding to enter into this Agreement or in taking or not taking action
hereunder.
I. ARTICLE
MISCELLANEOUS
A. Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Company or any applicable Subsidiary therefrom, shall be
effective unless the same shall be in writing and signed by the Required
Lenders (or by the Agent at the written request of the Required Lenders) and
the Company and acknowledged by the Agent, and then any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided that no such waiver, amendment, or consent shall,
unless in writing and signed by all the Lenders and the Company and
acknowledged by the Agent, do any of the following:
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1. increase or extend the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 8.2);
1. postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts due
to the Lenders (or any of them) hereunder or under any other Loan Document;
1. reduce the principal of, or the rate of interest specified
herein on, any Loan, reduce the BA Commission or the amount of any BA, or
(subject to clause (iv) below) reduce any fees or other amounts payable
hereunder or under any other Loan Document;
1. change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Obligations which is required for the Lenders
or any of them to take any action hereunder; or
1. amend this Section, or Section 2.13, or any provision herein
providing for consent or other action by all Lenders;
and, provided further, that (i) no amendment, waiver or consent shall, unless
in writing and signed by the Agent in addition to the Required Lenders or all
the Lenders, as the case may be, affect the rights or duties of the Agent under
this Agreement or any other Loan Document, (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Accepting Lender in addition to the
Required Lenders or all Lenders, as the case may be, affect the rights or
duties of the Accepting Lender under this Agreement or any other Loan Document,
(iii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Required Lenders or all Lenders, as
the case may be, affect the rights or duties of the Swing Line Lender under
this Agreement or any other Loan Document, and (iv) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed by
the parties thereto.
1. Notices. All notices, requests and other communications shall be
in writing (including, unless the context expressly otherwise provides, by
facsimile transmission, provided that any matter transmitted by the Company by
facsimile (i) shall be immediately confirmed by a telephone call to the
recipient at the number specified on Schedule 10.2, and (ii) shall be followed
promptly by delivery of a hard copy original thereof) and mailed, faxed or
delivered, to the address or facsimile number specified for notices on Schedule
10.2; or, as directed to the Company or the Agent, to such other address as
shall be designated by such party in a written notice to the other parties, and
as directed to any other party, at such other address as shall be designated by
such party in a written notice to the Company and the Agent.
1. All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered or
transmitted in
78
legible form by facsimile machine, respectively, or if mailed, upon the third
Business Day after the date deposited into the U.S. mail, certified mail,
return receipt requested; except that notices pursuant to Article II or IX to
the Agent, the Accepting Lender or the Swing Line Lender shall not be effective
until actually received by the Agent, as the case may be.
1. Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Company. The Agent and the Lenders shall be entitled to
rely on the authority of any Person purporting to be a Person authorized by the
Company to give such notice and the Agent and the Lenders shall not have any
liability to the Company or any other Person on account of any action taken or
not taken by the Agent or the Lenders in reliance upon such telephonic or
facsimile notice. The obligation of the Company to repay the Obligations shall
not be affected in any way or to any extent by any failure by the Agent and the
Lenders to receive written confirmation of any telephonic or facsimile notice
or the receipt by the Agent and the Lenders of a confirmation which is at
variance with the terms understood by the Agent and the Lenders to be contained
in the telephonic or facsimile notice.
A. No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.
A. Costs and Expenses. The Company shall:
1. whether or not the transactions contemplated hereby are
consummated, pay or reimburse the Agent, the Accepting Lender and the Swing
Line Lender within five Business Days after demand (subject to subsection
4.1(e)) for all reasonable costs and expenses incurred by the Agent, the
Accepting Lender and the Swing Line Lender, subject to the Fee Letter, in
connection with the development, preparation, delivery, administration and
execution of, and any amendment, supplement, waiver or modification to (in each
case, whether or not consummated), this Agreement, any Loan Document and any
other documents prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including
reasonable Attorney Costs incurred by the Agent, the Accepting Lender and
the Swing Line Lender with respect thereto; and
1. pay or reimburse the Agent and each Lender within five Business
Days after demand (subject to subsection 4.1(e)) for all reasonable costs and
expenses (including Attorney Costs) incurred by them in connection with the
enforcement, attempted enforcement, or preservation of any rights or remedies
under this Agreement or any other Loan Document during the existence of an
Event of Default or after acceleration of the Loans and other Obligations
(including in connection with any
79
"workout" or restructuring regarding the Loans and other Obligations, and
including in any Insolvency Proceeding or appellate proceeding); provided that
the Company shall not be obligated to pay or reimburse the Agent or any Lender
in respect of any suit or proceeding in which the Company is adverse to the
Agent or such Lender and final nonappealable judgment is rendered by a court of
competent jurisdiction in favor of the Company on all counts.
A. Company Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Company shall indemnify and hold the
Agent-Related Persons, and each Lender and each of their respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Obligations and the termination, resignation or replacement of
the Agent or replacement of any Lender) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this Agreement
or any document contemplated by or referred to herein, 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, including with respect
to any investigation, litigation or proceeding (including any Insolvency
Proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or the BAs or the use of the proceeds thereof, or related to any
Offshore Currency transactions entered into in connection herewith, whether or
not any Indemnified Person is a party thereto (all the foregoing, collectively,
the "Indemnified Liabilities"); provided that the Company shall have no
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting solely from the gross negligence or willful misconduct of
such Indemnified Person. The agreements in this Section shall survive payment
of all other Obligations.
A. Payments Set Aside. To the extent that the Company makes a payment
to the Agent or any Lender, or the Agent or any Lender exercises its right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Lender in its discretion) to be repaid to a trustee, receiver, or
any other party, in connection with any Insolvency Proceeding or otherwise,
then (a) to the extent of such recovery the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full
force and effect as if such payment had not been made or such set-off had not
occurred and (b) each Lender severally agrees to pay to the Agent upon demand
its pro rata share of any amount so recovered from or repaid by the Agent or
any Lender.
A. Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or
80
obligations under this Agreement without the prior written consent of the Agent
and each Lender.
1. Assignments, Participations, etc. Any Lender may, with the written
consent of the Company (unless an Event of Default exists), the Accepting
Lender, the Swing Line Lender and the Agent, which consents shall not be
unreasonably withheld, at any time assign and delegate to one or more Eligible
Assignees (provided that no written consent of the Company, the Accepting
Lender, the Swing Line Lender or the Agent shall be required in connection with
any assignment and delegation by a Lender to an Eligible Assignee that is an
Affiliate of such Lender) (each an "Assignee") all, or any ratable part of all,
of the Loans, the Commitment and the other rights and obligations of such
Lender hereunder, in a minimum amount of $10,000,000 (or, if less, all of such
Lender's remaining rights and obligations hereunder); provided, however, that
the Company, the Accepting Lender, the Swing Line Lender and the Agent may
continue to deal solely and directly with such Lender in connection with the
interest so assigned to an Assignee until (i) written notice of such
assignment, together with payment instructions, addresses and related
information with respect to the Assignee, shall have been given to the Company
and the Agent by such Lender and the Assignee; (ii) such Lender and its
Assignee shall have delivered to the Company and the Agent an Assignment and
Acceptance in the form of Exhibit G ("Assignment and Acceptance") together with
any Note or Notes subject to such assignment and (iii) the assignor Lender or
Assignee has paid to the Agent a processing fee in the amount of $2,500.
1. From and after the date that the Agent notifies the assignor
Lender that it has received and provided its consent (and received the consent
of the Company, if applicable, the Accepting Lender and the Swing Line Lender)
with respect to an executed Assignment and Acceptance and payment of the
above-referenced processing fee, (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have the
rights and obligations of a Lender under the Loan Documents, and (ii) the
assignor Lender shall, to the extent that rights and obligations hereunder and
under the other Loan Documents have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Documents.
1. Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of such Lender and the other interests
of such Lender (the "originating Lender") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii) the
Company, the Agent, the Swing Line Lender and the Accepting Lender shall
continue to deal solely and directly with the originating Lender in connection
with the originating Lender's rights and obligations under this Agreement and
the other Loan Documents, and (iv) no Lender shall
81
transfer or grant any participating interest under which the Participant has
rights to approve any amendment to, or any consent or waiver with respect to,
this Agreement or any other Loan Document, except to the extent such amendment,
consent or waiver would require unanimous consent of the Lenders as described
in the first proviso to Section 10.1. In the case of any such participation,
the Participant shall be entitled to the benefit of Sections 3.1, 3.3 and 10.5
as though it were also a Lender hereunder, and if amounts outstanding under
this Agreement are due and unpaid, or shall have been declared or shall have
become due and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of set-off 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.
1. Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement and any Note held by
it in favor of any Federal Reserve Bank in accordance with Regulation A of the
FRB or U.S. Treasury Regulation 31 CFR Section 203.14, and such Federal Reserve
Bank may enforce such pledge or security interest in any manner permitted under
applicable law.
A. Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information provided to it by the Company
or any Subsidiary, or by the Agent on the Company's or such Subsidiary's
behalf, under this Agreement or any other Loan Document, and neither such
Lender nor any of its Affiliates shall use any such information other than in
connection with or in enforcement of this Agreement and the other Loan
Documents or in connection with other business now or hereafter existing or
contemplated with the Company or any Subsidiary; except to the extent such
information (i) was or becomes generally available to the public other than as
a result of disclosure by such Lender, or (ii) was or becomes available on a
non-confidential basis from a source other than the Company, provided that such
source is not bound by a confidentiality agreement with the Company or any
Subsidiary known to such Lender; provided, however, that any Lender may
disclose such information (A) at the request or pursuant to any requirement of
any Governmental Authority to which such Lender is subject or in connection
with an examination of such Lender by any such authority; (B) pursuant to
subpoena or other court process; (C) when required to do so in accordance with
the provisions of any applicable Requirement of Law; (D) to the extent
reasonably required in connection with any litigation or proceeding to which
the Agent or any Lender or any of their respective Affiliates may be party; (E)
to the extent reasonably required in connection with the exercise of any remedy
hereunder or under any other Loan Document; (F) to such Lender's independent
auditors and other professional advisors; (G) to any Participant or Assignee,
actual or potential, provided that such Person agrees in writing to keep such
information confidential to the same extent required of the Lenders hereunder;
(H) as to any Lender or its Affiliate, as expressly permitted under the terms
of any other document or agreement regarding confidentiality to which the
Company or any
82
Subsidiary is party or is deemed party with such Lender or such Affiliate; and
(I) to its Affiliates.
A. Set-off. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists, or the Obligations have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Company, any such notice being waived by the
Company to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or
for the credit or the account of the Company against any and all Obligations
owing to such Lender, now or hereafter existing, irrespective of whether or not
the Agent or such Lender shall have made demand under this Agreement or any
other Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify the Company and the Agent
after any such set-off and application made by such Lender; provided that the
failure to give such notice shall not affect the validity of such set-off and
application.
A. Automatic Debits of Fees. With respect to any non-use fee,
arrangement fee or other fee, or any other cost or expense (including Attorney
Costs) due and payable to the Agent, the Swing Line Lender, the Accepting
Lender or BofA under the Loan Documents, the Company hereby irrevocably
authorizes BofA to debit any deposit account of the Company with BofA in an
amount such that the aggregate amount debited from all such deposit accounts
does not exceed such fee or other cost or expense. If there are insufficient
funds in such deposit accounts to cover the amount of the fee or other cost or
expense then due, such debits will be reversed (in whole or in part, in BofA's
sole discretion) and such amount not debited shall be deemed to be unpaid.
No such debit under this Section shall be deemed a set-off.
A. Notification of Addresses, Lending Offices, Etc. Each Lender shall
notify the Agent in writing of any change in the address to which notices to
such Lender should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
A. Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of which taken together shall be deemed to constitute but one
and the same instrument.
A. Severability. The illegality or unenforceability of any provision
of this Agreement or any instrument or agreement required hereunder shall not
in any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or such instrument or agreement.
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A. No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of the Company, the Lenders, the
Agent, the Agent-Related Persons and the Indemnified Persons, and their
respective permitted successors and assigns, and no other Person shall be a
direct or indirect legal beneficiary of, or have any direct or indirect cause
of action or claim in connection with, this Agreement or any other Loan
Document.
1. Governing Law and Jurisdiction. THIS AGREEMENT AND ANY NOTES SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
ILLINOIS; PROVIDED THAT THE COMPANY, THE AGENT AND THE LENDERS SHALL RETAIN ALL
RIGHTS ARISING UNDER FEDERAL LAW.
1. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND
THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS. EACH OF THE COMPANY, THE AGENT AND
THE LENDERS IRREVOCABLY WAIVES 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 ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE
COMPANY, THE AGENT AND THE LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS,
COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY
ILLINOIS LAW.
A. Waiver of Jury Trial. THE COMPANY, THE LENDERS AND THE AGENT EACH
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON OR INDEMNIFIED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE COMPANY, THE LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH
CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY
ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
84
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENT, RENEWAL, SUPPLEMENT OR MODIFICATION TO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
A. Judgment. If, for the purposes of obtaining judgment in any court,
it is necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of exchange used shall be that at
which in accordance with normal banking procedures the Agent could purchase the
first currency with such other currency on the Business Day preceding that on
which final judgment is given. The obligation of the Company in respect of any
such sum due from it to the Agent hereunder or under any other Loan Document
shall, notwithstanding any judgment in a currency (the "Judgment Currency")
other than that in which such sum is denominated in accordance with the
applicable provisions of this Agreement (the "Agreement Currency"), be
discharged only to the extent that on the Business Day following receipt by the
Agent of any sum adjudged to be so due in the Judgment Currency, the Agent may
in accordance with normal banking procedures purchase the Agreement Currency
with the Judgment Currency. If the amount of the Agreement Currency so
purchased is less than the sum originally due to the Agent in the Agreement
Currency, the Company agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify the Agent or the Person to whom such obligation was
owing against such loss. If the amount of the Agreement Currency so purchased
is greater than the sum originally due to the Agent in such currency, the Agent
agrees to return the amount of any excess to the Company (or to any other
Person who may be entitled thereto under applicable law).
A. Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Lenders and the Agent, and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written, relating to
the subject matter hereof and thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
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TRUSERV CORPORATION
---------------------------------------------------
86
By:
Title:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as Agent
By:
Title:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as a Lender
By:
Title:
BANK OF MONTREAL, as Co-Agent and
as a Lender
By:
Title:
THE FIRST NATIONAL BANK OF
CHICAGO, as Co-Agent and as a Lender
By:
Title:
PNC BANK, NATIONAL ASSOCIATION, as
Co-Agent and as a Lender
By:
Title:
WACHOVIA BANK OF GEORGIA, N.A., as
Co-Agent and as a Lender