EXHIBIT 10.1
EXECUTION VERSION
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364-DAY CREDIT AND GUARANTEE AGREEMENT
dated as of
August 11, 2004
among
BLOCK FINANCIAL CORPORATION,
as Borrower,
H&R BLOCK, INC.,
as Guarantor,
The Lenders Party Hereto,
BANK OF AMERICA, N.A.,
BARCLAYS BANK PLC,
HSBC BANK USA, NATIONAL ASSOCIATION, and
ROYAL BANK OF SCOTLAND PLC,
as Syndication Agents,
JPMORGAN CHASE BANK,
as Administrative Agent,
and
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
as Lead Arranger and Sole Bookrunner
$1,000,000,000 364-DAY REVOLVING CREDIT FACILITY
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS............................................................................................ 1
SECTION 1.1. Defined Terms............................................................................ 1
SECTION 1.2. Terms Generally.......................................................................... 16
SECTION 1.3. Classification of Loans and Borrowings................................................... 17
SECTION 1.4. Accounting Terms; GAAP................................................................... 17
ARTICLE II THE CREDITS........................................................................................... 17
SECTION 2.1. Commitments; Increases in Revolving Facility............................................. 17
SECTION 2.2. Loans and Borrowings..................................................................... 18
SECTION 2.3. Requests for Revolving Borrowings........................................................ 19
SECTION 2.4. Swingline Loans.......................................................................... 19
SECTION 2.5. Funding of Borrowings.................................................................... 21
SECTION 2.6. Interest Elections....................................................................... 21
SECTION 2.7. Termination and Reduction of Commitments................................................. 23
SECTION 2.8. Repayment of Loans; Term-Out Option; Evidence of Debt.................................... 23
SECTION 2.9. Prepayment of Loans...................................................................... 24
SECTION 2.10. Fees.................................................................................... 25
SECTION 2.11. Interest................................................................................ 26
SECTION 2.12. Alternate Rate of Interest.............................................................. 26
SECTION 2.13. Increased Costs......................................................................... 27
SECTION 2.14. Break Funding Payments.................................................................. 28
SECTION 2.15. Taxes................................................................................... 28
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set-offs............................. 29
SECTION 2.17. Mitigation Obligations; Replacement of Lenders.......................................... 31
SECTION 2.18. Extension of Revolving Termination Date................................................. 31
ARTICLE III REPRESENTATIONS AND WARRANTIES....................................................................... 33
SECTION 3.1. Organization; Powers..................................................................... 33
SECTION 3.2. Authorization; Enforceability............................................................ 33
SECTION 3.3. Governmental Approvals; No Conflicts..................................................... 33
SECTION 3.4. Financial Condition; No Material Adverse Change.......................................... 33
SECTION 3.5. Properties............................................................................... 34
SECTION 3.6. Litigation and Environmental Matters..................................................... 34
SECTION 3.7. Compliance with Laws and Agreements...................................................... 34
SECTION 3.8. Investment and Holding Company Status.................................................... 35
SECTION 3.9. Taxes.................................................................................... 35
SECTION 3.10. ERISA................................................................................... 35
SECTION 3.11. Disclosure.............................................................................. 35
SECTION 3.12. Federal Regulations..................................................................... 35
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SECTION 3.13. Subsidiaries............................................................................ 36
SECTION 3.14. Insurance............................................................................... 36
ARTICLE IV CONDITIONS............................................................................................ 36
SECTION 4.1. Effective Date........................................................................... 36
SECTION 4.2. Closing Date............................................................................. 36
SECTION 4.3. Each Loan................................................................................ 37
ARTICLE V AFFIRMATIVE COVENANTS.................................................................................. 37
SECTION 5.1. Financial Statements and Other Information............................................... 38
SECTION 5.2. Notices of Material Events............................................................... 39
SECTION 5.3. Existence; Conduct of Business........................................................... 39
SECTION 5.4. Payment of Taxes......................................................................... 39
SECTION 5.5. Maintenance of Properties; Insurance..................................................... 39
SECTION 5.6. Books and Records; Inspection Rights..................................................... 40
SECTION 5.7. Compliance with Laws..................................................................... 40
SECTION 5.8. Use of Proceeds.......................................................................... 40
SECTION 5.9. Cleandown................................................................................ 40
ARTICLE VI NEGATIVE COVENANTS.................................................................................... 40
SECTION 6.1. Adjusted Net Worth....................................................................... 40
SECTION 6.2. Indebtedness............................................................................. 40
SECTION 6.3. Liens.................................................................................... 43
SECTION 6.4. Fundamental Changes; Sale of Assets...................................................... 44
SECTION 6.5. Transactions with Affiliates............................................................. 45
SECTION 6.6. Restrictive Agreements................................................................... 45
ARTICLE VII GUARANTEE............................................................................................ 46
SECTION 7.1. Guarantee................................................................................ 46
SECTION 7.2. Delay of Subrogation..................................................................... 47
SECTION 7.3. Amendments, etc. with respect to the Obligations; Waiver of Rights....................... 48
SECTION 7.4. Guarantee Absolute and Unconditional..................................................... 48
SECTION 7.5. Reinstatement............................................................................ 49
SECTION 7.6. Payments................................................................................. 49
ARTICLE VIII EVENTS OF DEFAULT................................................................................... 49
ARTICLE IX THE ADMINISTRATIVE AGENT.............................................................................. 52
ARTICLE X MISCELLANEOUS.......................................................................................... 54
SECTION 10.1. Notices................................................................................. 54
SECTION 10.2. Waivers; Amendments..................................................................... 54
SECTION 10.3. Expenses; Indemnity; Damage Waiver...................................................... 55
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SECTION 10.4. Successors and Assigns.................................................................. 56
SECTION 10.5. Survival................................................................................ 59
SECTION 10.6. Counterparts; Integration; Effectiveness................................................ 59
SECTION 10.7. Severability............................................................................ 60
SECTION 10.8. Right of Setoff......................................................................... 60
SECTION 10.9. Governing Law; Jurisdiction; Consent to Service of Process.............................. 60
SECTION 10.10. WAIVER OF JURY TRIAL................................................................... 61
SECTION 10.11. Headings............................................................................... 61
SECTION 10.12. Confidentiality........................................................................ 61
SECTION 10.13. Interest Rate Limitation............................................................... 62
SECTION 10.14. Termination of Existing Agreement...................................................... 62
SECTION 10.15. USA Patriot Act........................................................................ 62
SCHEDULES:
Schedule 2.1 Commitments
Schedule 3.4(a) Guarantee Obligations
Schedule 3.6 Disclosed Matters
Schedule 3.13 Subsidiaries
Schedule 6.2 Existing Indebtedness
Schedule 6.3 Existing Liens
Schedule 6.4(b) Additional Businesses
Schedule 6.6 Existing Restrictions
EXHIBITS:
Exhibit A Form of Assignment and Acceptance
Exhibit B-1 Form of Opinion of Mayer, Brown, ▇▇▇▇ & Maw LLP
Exhibit B-2 Form of Opinion of ▇▇▇▇▇ ▇▇▇▇ LLP
Exhibit C Form of Extension Request
Exhibit D Form of New Lender Supplement
Exhibit E Form of Increased Facility Activation Notice
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364-DAY CREDIT AND GUARANTEE AGREEMENT, dated as of August 11, 2004,
among BLOCK FINANCIAL CORPORATION, a Delaware corporation, as Borrower, H&R
BLOCK, INC., a Missouri corporation, as Guarantor, the LENDERS party hereto, and
JPMORGAN CHASE BANK, a New York banking corporation, as Administrative Agent.
WHEREAS, the parties hereto desire to terminate the Existing
Agreement (as defined below); and
WHEREAS, the Borrower has requested that the Lenders provide a
364-day revolving credit facility in an amount of $1,000,000,000;
NOW, THEREFORE, in consideration of the agreements herein and in
reliance upon the representations and warranties set forth herein, the parties
agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Adjusted Net Worth" means, at any time, Consolidated Net Worth of
the Guarantor without giving effect to reductions in stockholders' equity
as a result of repurchases by the Guarantor of its own Capital Stock
subsequent to April 30, 2004 in an aggregate amount not exceeding
$350,000,000.
"Administrative Agent" means JPMorgan Chase Bank, a New York banking
corporation, in its capacity as administrative agent for the Lenders
hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified. For the avoidance of doubt, neither the Guarantor nor any of
its Subsidiaries shall be deemed to Control any of its franchisees by
virtue of provisions in the relevant franchise agreement regulating the
business and operations of such franchisee.
"Agreement" means this 364-Day Credit and Guarantee Agreement, as
amended, restated, supplemented or otherwise modified from time to time.
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"Alternate Base Rate" means, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day, and (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any
change in the Alternate Base Rate due to a change in the Prime Rate or the
Federal Funds Effective Rate shall be effective from and including the
effective date of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's
Commitment. If the Commitments have terminated or expired, the Applicable
Percentages shall be determined based upon the Commitments most recently
in effect, giving effect to any assignments.
"Applicable Rate" means, for any day, the rate per annum based on
the Ratings in effect on such day, as set forth under the relevant column
heading below:
Applicable Rate for
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Facility Fees Utilization Fees
Eurodollar Payable Payable
Category Ratings ABR Loans Loans Hereunder Hereunder
-------- -------------- --------- ---------- ------------- ----------------
I Higher than: A
by S&P or A2
by Moody's 0% 0.18% 0.07% 0.125%
II A by S&P or
A2 by Moody's 0% 0.27% 0.08% 0.125%
III A- by S&P and
A3 by Moody's 0% 0.31% 0.09% 0.125%
IV A - or BBB+by
S&P or A3 or
Baa1 by
Moody's 0% 0.40% 0.10% 0.125%
V BBB by S&P or
Baa2 by
Moody's 0% 0.50% 0.125% 0.125%
VI Lower than:
BBB by S&P or
Baa2 by
Moody's 0% 0.60% 0.150% 0.125%
; provided that (a) if on any day the Ratings of S&P and Moody's do not
fall in the same category, then the higher of such Ratings shall be
applicable for such day, unless one of the two ratings is two or more
Ratings levels lower than the other, in which case the applicable rate
shall be determined by reference to the Ratings level next below that of
the higher of the two ratings, (b) if on any day the Rating of only S&P or
▇▇▇▇▇'▇ is available, then such Rating shall be applicable for such day
and (c) if on any day a Rating is not available from either S&P or
Moody's, then the Ratings in category VI above shall be applicable for
such day. Any change in the Applicable Rate resulting from a change
3
in Rating by either S&P or Moody's shall become effective on the date such
change is publicly announced by such rating agency; provided further that
for all Revolving Loans outstanding on and after the Revolving Termination
Date (and deemed to be term loans pursuant to the proviso set forth in
Section 2.8(a)(i)) the Applicable Rate for utilization fees payable
pursuant to Section 2.10(b) shall be increased by 0.25% over such
Applicable Rate otherwise then in effect as set forth above.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party
whose consent is required by Section 10.4), and accepted by the
Administrative Agent, substantially in the form of Exhibit A or any other
form approved by the Administrative Agent.
"Availability Period" means the period from and including the
Closing Date to but excluding the earlier of the Revolving Termination
Date and the date of termination of the Commitments.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
"Borrower" means Block Financial Corporation, a Delaware corporation
and a wholly-owned indirect Subsidiary of the Guarantor.
"Borrowing" means (a) Revolving Loans of the same Type made,
converted or continued on the same date and, in the case of Eurodollar
Loans, as to which a single Interest Period is in effect or (b) a
Swingline Loan.
"Borrowing Request" means a request by the Borrower for a Revolving
Borrowing in accordance with Section 2.3.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required
by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on
which banks are not open for dealings in dollar deposits in the London
interbank market.
"Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under
GAAP, and the amount of such obligations shall be the capitalized amount
thereof determined in accordance with GAAP.
"Capital Stock" means any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person (other
than a corporation) and any and all warrants or options to purchase any of
the foregoing.
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"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States government or issued by
any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of
acquisition; (b) certificates of deposit, time deposits, eurodollar time
deposits or overnight bank deposits having maturities of six months or
less from the date of acquisition issued by (i) any Lender, (ii) any
commercial bank organized under the laws of the United States or any state
thereof having combined capital and surplus of not less than $500,000,000
or (iii) any other bank if, and to the extent, covered by FDIC insurance;
(c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by
Moody's, or carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies cease publishing
ratings of commercial paper issuers generally, and maturing within six
months from the date of acquisition; (d) repurchase obligations of any
Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days, with respect
to securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth
or territory of the United States, by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory,
political subdivision, taxing authority or foreign government (as the case
may be) are rated at least A by S&P or A2 by Moody's; (f) securities with
maturities of six months or less from the date of acquisition backed by
standby letters of credit issued by any Lender or any commercial bank
satisfying the requirements of clause (b) of this definition; (g) money
market mutual or similar funds that invest exclusively in assets
satisfying the requirements of clauses (a) through (f) of this definition;
(h) money market funds that (i) comply with the criteria set forth in SEC
Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are
rated AAA by S&P and Aaa by Moody's and (iii) have portfolio assets of at
least $1,000,000,000; (i) interests in privately offered investment funds
under Section 3(c)(7) of the U.S. Investment Company Act of 1940 where
such interests are (i) freely transferable and (ii) rated AAA by S&P or
Aaa by Moody's; and (j) one month LIBOR floating rate asset backed
securities that are (i) freely transferable and (ii) rated AAA by S&P or
Aaa by Moody's.
"Change in Control" means (a) the acquisition of ownership, directly
or indirectly, beneficially or of record, by any Person or group (within
the meaning of the Securities Exchange Act of 1934, as amended, and the
rules of the Securities and Exchange Commission thereunder as in effect on
the date hereof) of shares representing more than 25% of the aggregate
ordinary voting power represented by the issued and outstanding Capital
Stock of the Guarantor; (b) occupation of a majority of the seats (other
than vacant seats) on the board of directors of the Guarantor by Persons
who were neither (i) nominated by the board of directors of the Guarantor
nor (ii) appointed by directors so nominated; (c) the acquisition of
direct or indirect Control of the Guarantor by any Person or group; or (d)
the failure of the Guarantor to own, directly or indirectly, shares
representing 100% of the aggregate ordinary voting power represented by
the issued and outstanding Capital Stock of the Borrower.
5
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law,
rule or regulation or in the interpretation or application thereof by any
Governmental Authority after the date of this Agreement or (c) compliance
by any Lender (or, for purposes of Section 2.13(b), by any lending office
of such Lender or by such Lender's holding company, if any) with any
request, guideline or directive (whether or not having the force of law)
of any Governmental Authority made or issued after the date of this
Agreement.
"Charges" has the meaning assigned to such term in Section 10.13.
"Class" when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving
Loans or Swingline Loans.
"Closing Date" means the date on which the conditions specified in
Section 4.2 are satisfied (or waived in accordance with Section 10.2).
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Commitment" means, with respect to each Lender, the commitment of
such Lender to make Revolving Loans hereunder and to acquire
participations in Swingline Loans hereunder, expressed as an amount
representing the maximum aggregate amount of such Lender's Revolving
Credit Exposure hereunder, as such commitment may be (i) reduced from time
to time pursuant to Section 2.7, (ii) increased from time to time pursuant
to Section 2.1(b) and (iii) changed from time to time pursuant to
assignments by or to such Lender pursuant to Section 10.4. The initial
amount of each Lender's Commitment is set forth on Schedule 2.1 under the
heading "Commitment", or in the Assignment and Acceptance pursuant to
which such Lender shall have assumed its Commitment, as applicable.
"Commitment Expiration Date" has the meaning assigned to such term
in Section 2.18(a).
"Confidential Information Memorandum" means the Confidential
Information Memorandum dated July 2004 and furnished to the Lenders.
"Consolidated Net Worth" means, at any time, the total amount of
stockholders' equity of the Guarantor and its consolidated Subsidiaries at
such time determined on a consolidated basis in accordance with GAAP.
"Contractual Obligation" means, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a
Person, whether through the ability
6
to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto.
"Credit Parties" means the collective reference to the Borrower and
the Guarantor.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disclosed Matters" means (a) matters disclosed in the Borrower's
public filings with the Securities and Exchange Commission prior to August
10, 2004 and (b) the actions, suits, proceedings and environmental matters
disclosed in Schedule 3.6.
"dollars" or "$" refers to lawful money of the United States of
America.
"Effective Date" means the date on which the conditions specified in
Section 4.1 are satisfied (or waived in accordance with Section 10.2).
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental
Authority, relating in any way to the environment, preservation or
reclamation of natural resources, to the management, release or threatened
release of any Hazardous Material or to health and safety matters.
"Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of any Credit Party or any
Subsidiary directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials,
(c) exposure to any Hazardous Materials, (d) the release or threatened
release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which
liability is assumed or imposed with respect to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with any Credit Party, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for purposes
of Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to
a Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or
7
Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(d) of the Code or Section 303(d) of ERISA of an application
for a waiver of the minimum funding standard with respect to any Plan; (d)
the incurrence by any Credit Party or any of their ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any
Plan; (e) the receipt by any Credit Party or any ERISA Affiliate from the
PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any
Plan; (f) the incurrence by any Credit Party or any of their ERISA
Affiliates of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by any
Credit Party or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from any Credit Party or any ERISA Affiliate of any
notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be,
insolvent or in reorganization, within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the LIBO Rate.
"Events of Default" has the meaning assigned to such term in Article
VIII.
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United
States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in
the case of any Lender, in which its applicable lending office is located,
(b) any branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which the Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.17(b)), any
withholding tax that is imposed on amounts payable to such Foreign Lender
at the time such Foreign Lender becomes a party to this Agreement or is
attributable to such Foreign Lender's failure or inability to comply with
Section 2.15(e), except to the extent that such Foreign Lender's assignor
(if any) was entitled, at the time of assignment, to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to
Section 2.15(a).
"Existing Agreement" means the Credit and Guarantee Agreement, dated
as of August 12, 2003, among the Borrower, the Guarantor, the lenders
parties thereto, The Royal Bank of Scotland plc, as syndication agent,
Bank of America, N.A., as documentation agent, JPMorgan Chase Bank, as
Administrative Agent and ▇.▇. ▇▇▇▇▇▇ Securities Inc., as lead arranger and
sole book manager.
"Extension Request" has the meaning assigned to such term in Section
2.18.
"Federal Funds Effective Rate" means (a) for the first day of a
Borrowing, the rate per annum which is the average of the rates on the
offered side of the Federal funds
8
market quoted by three interbank Federal funds brokers, selected by the
Administrative Agent, at approximately the time the Borrower requests such
Borrowing, for dollar deposits in immediately available funds, in an
amount, comparable to the principal amount of such Borrowing and (b) for
each day of such Borrowing thereafter, or for any other amount hereunder
which bears interest at the Alternate Base Rate, the rate per annum which
is the average of the rates on the offered side of the Federal funds
market quoted by three interbank Federal funds brokers, selected by the
Administrative Agent, at approximately 2:00 p.m., New York City time, on
such day for dollar deposits in immediately available funds, in an amount,
comparable to the principal amount of such Borrowing or other amount, as
the case may be; in the case of both clauses (a) and (b), as determined by
the Administrative Agent and rounded upwards, if necessary, to the nearest
1/100 of 1%.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower or the
Guarantor, as the context may require.
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For
purposes of this definition, the United States of America, each State
thereof and the District of Columbia shall be deemed to constitute a
single jurisdiction.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States
of America, any other nation or any political subdivision thereof, whether
state, provincial or local, and any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or
having the economic effect of guaranteeing any Indebtedness or other
obligation of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, and including any obligation of the
guarantor, direct or indirect, (a) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness or other
obligation or to purchase (or to advance or supply funds for the purchase
of) any security for the payment thereof, (b) to purchase or lease
property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to
maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account
party in respect of any letter of credit or letter of guaranty issued to
support such Indebtedness or obligation; provided that the term Guarantee
shall not include endorsements for collection or deposit in the ordinary
course of business.
"Guarantee Obligation" means, as to any Person, any obligation of
such Person guaranteeing or in effect guaranteeing any Indebtedness,
leases, dividends or other
9
obligations (the "primary obligations") of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not
contingent, (a) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (b) to advance or
supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (d) otherwise to assure or hold harmless the owner
of any such primary obligation against loss in respect thereof; provided,
however, that the term Guarantee Obligation shall not include endorsements
of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation shall be deemed to be an
amount equal as of any date of determination to the stated determinable
amount of the primary obligation in respect of which such Guarantee
Obligation is made (unless such Guarantee Obligation shall be expressly
limited to a lesser amount, in which case such lesser amount shall apply)
or, if not stated or determinable, the amount as of any date of
determination of the maximum reasonably anticipated liability in respect
thereof as determined by such Person in good faith.
"Guarantor" means H&R Block, Inc., a Missouri corporation.
"Hazardous Materials" means all explosive or radioactive substances
or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or
asbestos containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any
nature regulated pursuant to any Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement
or other interest or currency exchange rate or commodity price hedging
arrangement.
"Increased Facility Activation Notice" means a notice substantially
in the form of Exhibit E.
"Increased Facility Closing Date" means any Business Day designated
as such in an Increased Facility Activation Notice.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits
or advances of any kind, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of
such Person upon which interest charges are customarily paid, (d) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all
obligations of such Person in respect of the deferred purchase price of
property or services (excluding current accounts payable and accrued
expenses incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such
10
Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such Person, whether or not
the Indebtedness secured thereby has been assumed, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations
of such Person, (i) all obligations, contingent or otherwise, of such
Person as an account party in respect of letters of credit and letters of
guaranty, (j) all obligations, contingent or otherwise, of such Person in
respect of bankers' acceptances and (k) for purposes of Section 6.2 only,
all preferred stock issued by a Subsidiary of such Person. The
Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness provide that such
Person is not liable therefor. Indebtedness of a Person shall not include
obligations with respect to funds held by such Person in custody for, or
for the benefit of, third parties which are to be paid at the direction of
such third parties (and are not used for any other purpose).
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indemnitee" has the meaning assigned to such term in Section
10.3(b).
"Information" has the meaning assigned to such term in Section
10.12.
"Interest Election Request" means a request by the Borrower to
convert or continue a Revolving Borrowing in accordance with Section 2.6.
"Interest Payment Date" means (a) with respect to any ABR Loan
(other than a Swingline Loan), the last day of each March, June, September
and December, (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part
and, in the case of a Eurodollar Borrowing with an Interest Period of more
than three months' duration, each day prior to the last day of such
Interest Period that occurs at intervals of three months' duration after
the first day of such Interest Period and (c) with respect to any
Swingline Loan, the day that such Loan is required to be repaid.
"Interest Period" means, with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one week, two
weeks or one, two, three or six months thereafter, as the Borrower may
elect; provided that (a) if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would
fall in the next calendar month, in which case such Interest Period shall
end on the next preceding Business Day and (b) any Interest Period that
commences on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the last calendar month
of such Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period. For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.
11
"Lenders" means the Persons listed on Schedule 2.1 and any other
Person that shall have become a party hereto pursuant to a New Lender
Supplement and/or an Assignment and Acceptance, other than any such Person
that ceases to be a party hereto pursuant to an Assignment and Acceptance.
Unless the context otherwise requires, the term "Lenders" includes the
Swingline Lender.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Markets
screen at approximately 11:00 a.m., London time, two Business Days prior
to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event
that such rate is not available at such time for any reason, then the
"LIBO Rate" with respect to such Eurodollar Borrowing for such Interest
Period shall be determined by reference to such other comparable publicly
available service for displaying eurodollar rates as may be selected by
the Administrative Agent or, in the absence of such availability, by
reference to the rate at which dollar deposits of $5,000,000 and for a
maturity comparable to such Interest Period are offered by the principal
London office of the Administrative Agent in immediately available funds
in the London interbank market at approximately 11:00 a.m., London time,
two Business Days prior to the commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic
effect as any of the foregoing) relating to such asset and (c) in the case
of securities, any purchase option, call or similar right of a third party
with respect to such securities; provided that clause (c) above shall be
deemed not to include stock options granted by any Person to its
directors, officers or employees with respect to the Capital Stock of such
Person.
"Loan Documents" means this Agreement and the Notes, if any.
"Loans" means the loans made by the Lenders (including the Swingline
Lender) to the Borrower pursuant to this Agreement.
"Margin Stock" means any "margin stock" as defined in Regulation U
of the Board.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, property or condition (financial or otherwise) of the
Guarantor and the Subsidiaries taken as a whole, (b) the ability of any
Credit Party to perform any of its obligations under this Agreement or (c)
the rights of or benefits available to the Lenders under this Agreement.
"Material Indebtedness" means Indebtedness (other than the Loans),
or obligations in respect of one or more Hedging Agreements, of any one or
more of the Credit Parties and any Subsidiaries in an aggregate principal
amount exceeding
12
$40,000,000. For purposes of determining Material Indebtedness, the
"principal amount" of the obligations of any Credit Party or any
Subsidiary in respect of any Hedging Agreement at any time shall be the
aggregate amount (giving effect to any netting agreements) that the Credit
Party or such Subsidiary would be required to pay if such Hedging
Agreement were terminated at such time.
"Material Subsidiary" means any Subsidiary of any Credit Party the
aggregate assets or revenues of which, as of the last day of the most
recently ended fiscal quarter for which the Borrower has delivered
financial statements pursuant to Section 5.1(a) or (b), when aggregated
with the assets or revenues of all other Subsidiaries with respect to
which the actions contemplated by Section 6.4 are taken, are greater than
5% of the total assets or total revenues, as applicable, of the Guarantor
and its consolidated Subsidiaries, in each case as determined in
accordance with GAAP.
"Maturity Date" means August 10, 2006 or such later date as shall be
determined pursuant to the provisions of Section 2.18.
"Maximum Rate" has the meaning assigned to such term in Section
10.13.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Notes" means the collective reference to any promissory note
evidencing Loans.
"Objecting Lender" has the meaning assigned to such term in Section
2.18(a).
"Obligations" means, collectively, the unpaid principal of and
interest on the Loans and all other obligations and liabilities of the
Borrower (including, without limitation, interest accruing at the then
applicable rate provided herein after the maturity of the Loans and
interest accruing at the then applicable rate provided herein after the
filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is
allowed in such proceeding) to the Administrative Agent or any Lender,
whether direct or indirect, absolute or contingent, due or to become due,
or now existing or hereafter incurred, which may arise under, out of, or
in connection with, this Agreement or any other document made, delivered
or given in connection herewith, whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of
counsel to the Administrative Agent or to the Lenders that are required to
be paid by the Borrower pursuant to the terms of any of the foregoing
agreements).
"Other Credit Agreement" means the Five-Year Credit and Guarantee
Agreement, dated as of August 11, 2004, among the Borrower, the Guarantor,
various financial institutions and JPMorgan Chase Bank, as administrative
agent, and any amendments
13
thereto and any restatements, extensions, renewals and replacements
thereof (regardless of whether the amount available thereunder is
increased or the term thereof is modified).
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or
similar levies arising from any payment made hereunder or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement.
"Participant" has the meaning assigned to such term in Section
10.4(e).
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar
functions.
"Permitted Encumbrances" means:
(a) judgment Liens in respect of judgments not constituting an Event
of Default under clause (k) of Article VIII;
(b) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.4;
(c) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 30 days or are being contested in compliance with Section 5.4;
(d) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(e) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds
and other obligations of a like nature, in each case in the ordinary
course of business; and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere
with the ordinary conduct of business of the Credit Parties or any
Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or
14
Section 302 of ERISA, and in respect of which any Credit Party or any
ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by JPMorgan Chase Bank as its prime rate in effect at
its principal office in New York City; each change in the Prime Rate shall
be effective from and including the date such change is publicly announced
as being effective.
"RAL Receivables Amount" means, at any time, the difference (but not
less than zero) between (i) the aggregate amount of funds received by the
Guarantor, any Subsidiary or any qualified or unqualified special purpose
entity created by any Subsidiary with respect to the transfer of refund
anticipation loans, or participation interests in refund anticipation
loans (and/or related rights and interests), to one or more third parties
in one or more RAL Receivables Transactions, at or prior to such time,
minus (ii) the aggregate amount received by such one or more third parties
with respect to the transferred refund anticipation loans, or
participation interests in refund anticipation loans (and/or related
rights and interests), in such one or more RAL Receivables Transactions,
at or prior to such time, excluding from the amounts received by such one
or more third parties, the aggregate amount of any origination, set up,
structuring or similar fees, all implicit or explicit financing expenses
and all indemnification and reimbursement payments paid to such one or
more third parties in connection with such one or more RAL Receivables
Transactions.
"RAL Receivables Transaction" means any securitization, on - or off
- balance sheet financing or sale transaction, involving refund
anticipation loans, or participation interests in refund anticipation
loans (and/or related rights and interests), that were acquired by the
Guarantor, any Subsidiary or any qualified or unqualified special purpose
entity created by any Subsidiary.
"Rating" means the rating of S&P or Moody's, as the case may be,
applicable to the long-term senior unsecured non-credit enhanced debt of
the Borrower, as announced by S&P or Moody's, as the case may be, from
time to time.
"Register" has the meaning assigned to such term in Section 10.4(c).
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"Required Lenders" means, at any time, Lenders having Revolving
Credit Exposures and unused Commitments representing at least 51% of the
sum of the total Revolving Credit Exposures and unused Commitments at such
time.
"Restricted Margin Stock" means all Margin Stock owned by the
Guarantor and its Subsidiaries to the extent the value of such Margin
Stock does not exceed 25% of the
15
value of all assets of the Guarantor and its Subsidiaries (determined on a
consolidated basis) that are subject to the provisions of Section 6.3 and
6.4.
"Revolving Borrowing" means a Borrowing comprised of Revolving
Loans.
"Revolving Credit Exposure" means with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's
Revolving Loans and Swingline Exposure.
"Revolving Loans" has the meaning given to it in Section 2.1(a).
"Revolving Termination Date" means August 10, 2005 or such later
date as shall be determined pursuant to the provisions of Section 2.18.
"RSM" has the meaning assigned to such term in Section 5.1(e).
"S&P" means Standard & Poor's Ratings Services.
"Short-Term Debt" means, at any time, the aggregate amount of
Indebtedness of the Guarantor and its Subsidiaries at such time (excluding
seasonal Indebtedness of H&R Block Canada, Inc.) having a final maturity
less than one year after such time, determined on a consolidated basis in
accordance with GAAP, minus (a) to the extent otherwise included therein,
Indebtedness outstanding at such time (i) under mortgage facilities
secured by mortgages and related assets, (ii) incurred to fund servicing
obligations required as part of servicing mortgage backed securities in
the ordinary course of business, (iii) incurred and secured by
broker-dealer Subsidiaries in the ordinary course of business and (iv)
deposits and other customary banking related liabilities incurred by
banking Subsidiaries in the ordinary course of business, (b) the excess,
if any, of (i) the aggregate amount of cash and Cash Equivalents held at
such time in accounts of the Guarantor and its Subsidiaries (other than
broker-dealer Subsidiaries and banking Subsidiaries) to the extent freely
transferable to the Credit Parties and capable of being applied to the
Obligations without any contractual, legal or tax consequences over (ii)
$15,000,000 and (c) to the extent otherwise included therein, the current
portion of long term debt. For the avoidance of doubt, the Loans, the
loans made under the Other Credit Agreement, and any loans made under any
amended, replacement or successor credit facilities hereunder or under the
Other Credit Agreement shall be considered Short-Term Debt for purposes of
this Agreement.
"Subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association
or other entity the accounts of which would be consolidated with those of
the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such
date, as well as any other corporation, limited liability company,
partnership, association or other entity (a) of which securities or other
ownership interests representing more than 50% of the equity or more than
50% of the ordinary voting power or, in the case of a partnership, more
than 50% of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of
16
such date, otherwise Controlled, by the parent or one or more Subsidiaries
of the parent or by the parent and one or more Subsidiaries of the parent.
Notwithstanding the foregoing, no entity shall be considered a
"Subsidiary" solely as a result of the effect and application of Statement
of Financial Accounting Standards No. 46. Unless the context shall
otherwise require, all references to a "Subsidiary" or to "Subsidiaries"
in this Agreement shall refer to a Subsidiary or Subsidiaries of the
Guarantor, including, without limitation, the Borrower and the
Subsidiaries of the Borrower.
"Swingline Exposure" means, at any time with respect to all Lenders,
the aggregate principal amount of all Swingline Loans outstanding at such
time. The Swingline Exposure of any Lender at any time shall be its
Applicable Percentage of the total Swingline Exposure at such time.
"Swingline Lender" means JPMorgan Chase Bank, in its capacity as
lender of Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section 2.4(a).
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Total Facility Commitments" means the sum of (a) the total
Commitments plus (b) the total "Commitments" under and as defined in the
Other Credit Agreement.
"Total Facility Loan Outstandings" has the meaning assigned to such
term in Section 6.2.
"Transactions" means the execution, delivery and performance by the
Credit Parties of this Agreement, the borrowing of Loans and the use of
the proceeds thereof.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the LIBO Rate or the Alternate
Base Rate.
"Unrestricted Margin Stock" means all Margin Stock owned by the
Guarantor and its Subsidiaries other than Restricted Margin Stock.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan,
as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.2. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such
17
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.3. Classification of Loans and Borrowings. For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing").
SECTION 1.4. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
THE CREDITS
SECTION 2.1. Commitments; Increases in Revolving Facility. (a)
Subject to the terms and conditions set forth herein (including the proviso at
the end of Section 6.2), each Lender severally agrees to make revolving loans
("Revolving Loans") to the Borrower from time to time during the Availability
Period in an aggregate principal amount that will not result in (i) such
Lender's Revolving Credit Exposure exceeding such Lender's Commitment or (ii)
the total Revolving Credit Exposures exceeding the total Commitments. Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Revolving Loans.
(b) The Borrower and any one or more Lenders (including New Lenders)
may from time to time agree that such Lenders shall make, obtain or increase the
amount of their Commitments by executing and delivering to the Administrative
Agent an Increased Facility
18
Activation Notice specifying (i) the amount of such increase and (ii) the
applicable Increased Facility Closing Date. Notwithstanding the foregoing,
without the consent of the Required Lenders, (x) in no event shall the aggregate
amount of the Commitments exceed $1,250,000,000, (y) each increase effected
pursuant to this paragraph shall be in a minimum amount of $10,000,000 and (z)
no more than three Increased Facility Closing Dates may be selected by the
Borrower after the Effective Date. No Lender shall have any obligation to
participate in any increase described in this paragraph unless it agrees to do
so in its sole discretion. Any additional bank, financial institution or other
entity which, with the consent of the Borrower and the Administrative Agent
(which consent shall not be unreasonably withheld or delayed), elects to become
a "Lender" under this Agreement in connection with any transaction described in
this Section 2.1(b) shall execute a New Lender Supplement (each, a "New Lender
Supplement"), substantially in the form of Exhibit D, whereupon such bank,
financial institution or other entity (a "New Lender") shall become a Lender for
all purposes and to the same extent as if originally a party hereto and shall be
bound by and entitled to the benefits of this Agreement. The effectiveness of
any Increased Facility Activation Notice shall be subject to the receipt by the
Administrative Agent of such evidence as it shall reasonably request of the due
authorization, execution and delivery by the Borrower of such Increased Facility
Activation Notice. On each Increased Facility Closing Date, the Borrower shall
make such Borrowings and/or prepayments of Loans such that, after giving effect
thereto, the Revolving Credit Exposure of each Lender shall be the same
percentage of such Lender's Commitment as the Revolving Credit Exposure of each
other Lender is of such other Lender's Commitment.
SECTION 2.2. Loans and Borrowings. (a) Each Revolving Loan shall be
made as part of a Borrowing consisting of Revolving Loans made by the Lenders
ratably in accordance with their respective Commitments. The failure of any
Lender to make any Loan required to be made by it shall not relieve any other
Lender of its obligations hereunder; provided that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required.
(b) Subject to Section 2.12, each Revolving Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith. Each Swingline Loan shall bear interest at a rate to be
agreed upon by the Swingline Lender and the Borrower, which rate shall in no
case be greater than the Alternate Base Rate; provided that, if the Swingline
Lender shall require other Lenders to acquire participations in such Swingline
Loan pursuant to Section 2.4(c) or (d), then such Swingline Loan shall bear
interest at the Alternate Base Rate. Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option shall not
affect the obligation of the Borrower to repay such Loan in accordance with the
terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $25,000,000. At the time that
each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not less than $25,000,000;
provided that an ABR Revolving Borrowing may be in an aggregate amount that is
equal to the entire unused balance of the total Commitments.
19
Each Swingline Loan shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000. Borrowings of more than one Type and
Class may be outstanding at the same time; provided that there shall not at any
time be more than a total of twelve Eurodollar Revolving Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Revolving Termination Date, provided that the Borrower may elect to
convert the Revolving Loans to term loans as provided in the proviso to Section
2.8(a)(i).
SECTION 2.3. Requests for Revolving Borrowings. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of such
request by telephone (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., New York City time, three Business Days before the date of the
proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 11:00
a.m., New York City time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.2:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business
Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements
of Section 2.5(a).
If no election as to the Type of Revolving Borrowing is specified, then the
requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Revolving Borrowing, then
the Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.4. Swingline Loans. (a) Subject to the terms and
conditions set forth herein (including the proviso at the end of Section 6.2),
the Swingline Lender agrees to make Swingline Loans to the Borrower from time to
time during the Availability Period, in an aggregate principal amount at any
time outstanding that will not result in (x) the aggregate
20
principal amount of outstanding Swingline Loans exceeding $100,000,000 or (y)
the total Revolving Credit Exposures exceeding the total Commitments; provided
that the Swingline Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. Within the foregoing limits and subject
to the terms and conditions set forth herein, the Borrower may borrow, prepay
and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy), not
later than 4:00 p.m., New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day), and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrower. The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a wire transfer sent to an
account specified by the Borrower by 5:00 p.m., New York City time, on the
requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., New York City time, on any
Business Day require (i) the Lenders to acquire participations on such Business
Day in all or a portion of the Swingline Loans outstanding. Such notice shall
specify the aggregate amount of Swingline Loans in which Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will
give notice thereof to each Lender, specifying in such notice such Lender's
Applicable Percentage of such Swingline Loan or Loans. Each Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided above,
to pay to the Administrative Agent, for the account of the Swingline Lender,
such Lender's Applicable Percentage of such Swingline Loan or Loans.
(d) Each Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to paragraph (c) above, as
applicable, is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. Each
Lender shall comply with its obligation under this paragraph by wire transfer of
immediately available funds, in the same manner as provided in Section 2.5 with
respect to Loans made by such Lender (and Section 2.5 shall apply, mutatis
mutandis, to the payment obligations of the Lenders), and the Administrative
Agent shall promptly pay to the Swingline Lender the amounts so received by it
from the Lenders. The Administrative Agent shall notify the Borrower of any
participation in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of participations in a
Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any
default in the payment thereof.
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SECTION 2.5. Funding of Borrowings. (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders; provided that, in the case of an ABR Borrowing, if notice
of a Borrowing Request was given before the date of the proposed Borrowing, each
Lender shall make such ABR Loan on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, and in the event
notice was given on the date of the proposed Borrowing, each Lender shall make
such ABR Loan on the proposed date thereof by wire transfer of immediately
available funds by 1:00 p.m., New York City Time; provided further that
Swingline Loans shall be made as provided in Section 2.4. The Administrative
Agent will make such Loans available to the Borrower by wire transfer of the
amounts so received, in like funds, to an account specified by the Borrower by
5:00 p.m., New York City time (to the extent funds in respect thereof are
received by the Administrative Agent reasonably prior to such time) on the date
of each requested Borrowing.
(b) Unless the Administrative Agent shall have received notice from
a Lender prior to the proposed date of any Borrowing (or, in the event notice
was given on the date of the proposed Borrowing, prior to the proposed time of
such funding) that such Lender will not make available to the Administrative
Agent such Lender's share of such Borrowing, the Administrative Agent may assume
that such Lender has made such share available on such date in accordance with
paragraph (a) of this Section and may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the date such
amount is made available to the Borrower to but excluding the date of payment to
the Administrative Agent, at (i) in the case of such Lender, the Federal Funds
Effective Rate or (ii) in the case of the Borrower, the interest rate then
applicable to ABR Loans. If such Lender pays such amount to the Administrative
Agent, then such amount shall constitute such Lender's Loan included in such
Borrowing.
SECTION 2.6. Interest Elections. (a) Each Revolving Borrowing
initially shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Revolving Borrowing, shall have an initial
Interest Period as specified in such Borrowing Request or determined pursuant to
the penultimate sentence of Section 2.3. Thereafter, the Borrower may elect to
convert such Borrowing to a different Type or to continue such Borrowing and, in
the case of a Eurodollar Revolving Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. This Section shall not apply to
Swingline Borrowings. For the avoidance of doubt, the foregoing applies to
Borrowings that have been converted to term loans pursuant to Section 2.8(a)(i).
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would
22
be required under Section 2.3 if the Borrower were requesting a Revolving
Borrowing of the Type resulting from such election to be made on the effective
date of such election. Each such telephonic Interest Election Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Interest Election Request in a form approved
by the Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.2:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (iv) below shall be
specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of
the term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Revolving Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if
an Event of Default has occurred and is continuing and the Administrative Agent,
at the request of the Required Lenders, so notifies the Borrower, then, so long
as an Event of Default is continuing (i) no outstanding Revolving Borrowing may
be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid,
each Eurodollar Revolving Borrowing shall be converted to an ABR Borrowing at
the end of the Interest Period applicable thereto.
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SECTION 2.7. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Commitments shall terminate on the Revolving
Termination Date.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $25,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.9, the Revolving Credit Exposures would exceed the
total Commitments.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) or (c) of
this Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the applicable Lenders of the contents thereof. Each notice
delivered by the Borrower pursuant to this Section shall be irrevocable;
provided that a notice of termination of the Commitments delivered by the
Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Any termination or reduction
of the Commitments shall be permanent. Each reduction of the Commitments shall
be made ratably among the applicable Lenders in accordance with their respective
Commitments.
SECTION 2.8. Repayment of Loans; Term-Out Option; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay (i) to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Revolving Loan on the Revolving Termination Date, provided that,
if prior to the Revolving Termination Date the Borrower gives the Administrative
Agent at least one Business Day's notice that the Borrower elects that all or
any portion (allocated pro rata among the Lenders based on their Commitments
immediately prior to the Revolving Termination Date) of the Revolving Loans that
are to be outstanding on the Revolving Termination Date be converted to term
loans, then on the Revolving Termination Date such Revolving Loans will be
deemed to be term loans payable in full on the Maturity Date and (ii) to the
Swingline Lender or to the Administrative Agent pursuant to Section 2.4(c) the
then unpaid principal amount of each Swingline Loan on the earlier of the first
Business Day prior to the Revolving Termination Date and the first date after
such Swingline Loan is made that is five Business Days after such Swingline Loan
is made; provided that on each date that a Revolving Loan is made, the Borrower
shall repay all Swingline Loans then outstanding. For the avoidance of doubt,
the Borrower shall not have the right to elect the "term out" option described
in the proviso to clause (i) above with respect to fewer than all of the Lenders
with Revolving Loans outstanding at the time of such election.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
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(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 10.4) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
In addition, upon receipt of an affidavit of an officer of such Lender as to the
loss, theft, destruction or mutilation of the promissory note, and, in the case
of any such loss, theft, destruction or mutilation, upon cancellation of such
promissory note, the Borrower will issue, in lieu thereof, a replacement
promissory note in the same principal amount thereof and otherwise of like
tenor.
SECTION 2.9. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part without premium or penalty except as provided in Section 2.14, subject to
prior notice in accordance with paragraph (b) of this Section.
(b) The Borrower shall notify the Administrative Agent (and, in the
case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Revolving Borrowing, not later than 11:00 a.m., New
York City time, three Business Days before the date of prepayment, (ii) in the
case of prepayment of an ABR Revolving Borrowing, not later than 11:00 a.m., New
York City time, on the date of prepayment or (iii) in the case of prepayment of
a Swingline Loan, not later than 12:00 noon, New York City time, on the date of
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof to
be prepaid; provided that, if a notice of prepayment is given in connection with
a conditional notice of termination of the Commitments as contemplated by
Section 2.7, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.7. Promptly following
receipt of any such notice relating to a Revolving Borrowing, the Administrative
Agent shall advise the Lenders of the contents thereof. Each partial prepayment
of any Revolving Borrowing shall be in an amount that would be permitted in the
case of an advance of a Revolving Borrowing of the same Type as provided in
Section 2.2. Each prepayment of a Revolving Borrowing shall be applied ratably
to
25
the Loans included in the prepaid Borrowing. Prepayments shall be accompanied by
accrued interest to the extent required by Section 2.11.
SECTION 2.10. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a facility fee, which shall
accrue at the Applicable Rate on the daily amount of the Commitment of such
Lender (whether used or unused) during the period from and including the Closing
Date to but excluding the date on which such Commitment terminates; provided
that, if such Lender continues to have any Revolving Credit Exposure or any term
loan after its Commitment terminates, then such facility fee shall continue to
accrue on the daily amount of such Lender's Revolving Credit Exposure or such
term loan from and including the date on which its Commitment terminates to but
excluding the date on which such Lender ceases to have any Revolving Credit
Exposure or any term loan. Accrued facility fees shall be payable in arrears on
the last day of March, June, September and December of each year, on the date of
any voluntary termination of the Commitments and on the date on which all Loans
become due and payable (by acceleration or otherwise); provided that any
facility fees accruing after the date on which all Loans become due and payable
shall be payable on demand. All facility fees shall be computed on the basis of
a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day).
(b) The Borrower agrees to pay to the Administrative Agent for the
account of each Lender a utilization fee, which shall accrue at the Applicable
Rate on the daily amount of the Revolving Credit Exposure of such Lender for
each day on which the Revolving Credit Exposure of all Lenders exceeds 50% of
the total Lenders' Commitments; provided that, if any Lender continues to have
any Revolving Credit Exposure or any term loan after its Commitment terminates
then such utilization fee shall continue to accrue at the Applicable Rate on the
entire amount of such Lender's Revolving Credit Exposure or such term loan
(whether or not the amount of such Revolving Credit Exposure or term loan
exceeds 50% of such Lender's Commitment in effect prior to the Revolving
Termination Date), from and including the date on which the Commitments
terminate to but excluding the date on which such Lender ceases to have any
Revolving Credit Exposure or any term loan. Accrued utilization fees shall be
payable in arrears on the last day of March, June, September and December of
each year, on the date of any voluntary termination of the Commitments and on
the date on which all Loans become due and payable (by acceleration or
otherwise); provided that any utilization fees accruing after the date on which
the Loans become due and payable shall be payable on demand. All utilization
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first but excluding the
last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its
own account, fees payable in the amounts and at the times separately agreed upon
between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution, in
the case of facility fees and utilization fees, to the Lenders. Fees paid shall
not be refundable under any circumstances.
26
SECTION 2.11. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at a rate per annum equal to the Alternate Base Rate plus
the Applicable Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at a rate per annum equal to the LIBO Rate for the Interest Period in
effect for such Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided above or (ii) in the case of
any other amount, 2% plus the rate applicable to ABR Loans as provided above.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan; provided that (i) interest accrued
pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in
the event of any repayment or prepayment of any Loan (other than a prepayment of
an ABR Revolving Loan prior to the end of the Availability Period), accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment, (iii) in the event of any conversion of any
Eurodollar Revolving Loan prior to the end of the current Interest Period
therefor, accrued interest on such Loan shall be payable on the effective date
of such conversion and (iv) all accrued interest shall be payable upon
termination of the Commitments.
(e) All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error. The Administrative
Agent shall as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each change in interest rate.
SECTION 2.12. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(i) the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the LIBO Rate for
such Interest Period; or
(ii) the Administrative Agent is advised by the Required
Lenders that the LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans included in such Borrowing for such Interest
Period;
27
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective, and (ii) if any Borrowing Request requests a Eurodollar Revolving
Borrowing, such Borrowing shall be made as an ABR Borrowing.
SECTION 2.13. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender; or
(ii) impose on any Lender or the London interbank market any
other condition affecting this Agreement or Eurodollar Loans made by
such Lender;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or to
reduce the amount of any sum received or receivable by such Lender hereunder
(whether of principal, interest or otherwise), then the Borrower will pay to
such Lender such additional amount or amounts as will compensate such Lender for
such additional costs incurred or reduction suffered.
(b) If any Lender determines that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of return
on such Lender's capital or on the capital of such Lender's holding company, if
any, as a consequence of this Agreement or the Loans made by such Lender to a
level below that which such Lender or such Lender's holding company could have
achieved but for such Change in Law (taking into consideration such Lender's
policies and the policies of such Lender's holding company with respect to
capital adequacy), then from time to time the Borrower will pay to such Lender
such additional amount or amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
(c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate such Lender or its holding company, as the case may be,
as specified in paragraph (a) or (b) of this Section (together with a statement
of the reason for such compensation and a calculation thereof in reasonable
detail) shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender's right to demand such compensation; provided that the Borrower shall not
be required to compensate a Lender pursuant to this Section for any increased
costs or reductions incurred more than six months prior to the date that such
Lender notifies the Borrower of the Change in Law giving rise to such increased
28
costs or reductions and of such Lender's intention to claim compensation
therefor; provided, further, that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the six-month period referred
to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.14. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Revolving Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice is permitted to be
revocable under Section 2.9(b) and is revoked in accordance herewith), (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.17, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, the loss to any Lender attributable to any such event shall be
deemed to include an amount determined by such Lender to be equal to the excess,
if any, of (i) the amount of interest that such Lender would pay for a deposit
equal to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such borrowing, conversion or continuation) if the interest rate payable on such
deposit were equal to the LIBO Rate for such Interest Period, over (ii) the
amount of interest that such Lender would earn on such principal amount for such
period if such Lender were to invest such principal amount for such period at
the interest rate that would be bid by such Lender (or an affiliate of such
Lender) for dollar deposits from other banks in the eurodollar market at the
commencement of such period. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.
SECTION 2.15. Taxes. (a) Any and all payments by or on account of
any obligation of the Borrower or the Guarantor hereunder shall be made free and
clear of and without deduction for any Indemnified Taxes or Other Taxes;
provided that if the Borrower or the Guarantor shall be required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent or Lender (as the case may be) receives an amount equal
to the sum it would have received had no such deductions been made (provided,
however, that neither the Borrower nor the Guarantor shall be required to
increase any such amounts payable to the Administrative Agent or Lender (as the
case may be) with respect to any Indemnified or Other Taxes that are
attributable to such Lender's failure to comply with the requirements of
paragraph (e) of this Section), (ii) the Borrower or the Guarantor shall make
such deductions and (iii) the Borrower or the Guarantor shall pay the full
amount deducted to the relevant Governmental Authority in accordance with
applicable law.
29
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each
Lender, within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section)
paid by the Administrative Agent or such Lender, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender, or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Borrower, such properly completed and
executed documentation prescribed by applicable law as will permit such payments
to be made without withholding or at a reduced rate.
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest or fees, or under Section 2.13, 2.14
or 2.15, or otherwise) prior to 12:00 noon, New York City time, on the date when
due, in immediately available funds, without set-off or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, except payments to be made directly to the Swingline Lender as
expressly provided herein and except that payments pursuant to Sections 2.13,
2.14, 2.15 and 10.3 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, interest,
fees and any other amounts then due hereunder, such funds shall be applied (i)
first, to pay interest and fees then due
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hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, (ii) second, to pay
principal then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal then due to such parties, and (iii)
third, any other amounts due and owing hereunder, ratably among the parties
entitled thereto in accordance with such amounts then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in Swingline Loans
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Revolving Loans and participations in Swingline Loans
and accrued interest thereon than the proportion received by any other Lender,
then the Lender receiving such greater proportion shall purchase (for cash at
face value) participations in the Revolving Loans and participations in
Swingline Loans of other Lenders to the extent necessary so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Revolving Loans and participations in Swingline Loans, provided that (i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Revolving Loans to
any assignee or participant, other than to the Borrower or any Subsidiary or
Affiliate thereof (as to which the provisions of this paragraph shall apply).
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.5(b), 2.16(c) or 2.16(d), then the Administrative
Agent may, in its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent for the
account of such Lender to satisfy such Lender's obligations under such Sections
until all such unsatisfied obligations are fully paid.
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SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.13, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.13 or 2.15, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.13, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans hereunder, or if any
Lender becomes an Objecting Lender, then the Borrower may, at its sole expense
and effort, upon notice to such Lender and the Administrative Agent, require
such Lender to assign and delegate, without recourse (in accordance with and
subject to the restrictions contained in Section 10.4), all its interests,
rights and obligations under this Agreement to an assignee that shall assume
such obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent (and, if a Commitment is being
assigned, the Swingline Lender), which consent shall not unreasonably be
withheld, (ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in Swingline Loans,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.13 or payments required to be made pursuant to
Section 2.15, such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply. In determining whether to make a claim, and
calculating the amount of compensation, under Sections 2.13 and 2.15, each
Lender shall apply standards that are not inconsistent with those generally
applied by such Lender in similar circumstances.
SECTION 2.18. Extension of Revolving Termination Date. (a) Not less
than 30 days and not more than 60 days prior to the Revolving Termination Date
then in effect, provided that no Event of Default shall have occurred and be
continuing, the Borrower may request an extension of such Revolving Termination
Date by submitting to the Administrative Agent an Extension Request (an
"Extension Request") containing the information in respect of such extension
specified in Exhibit C, which the Administrative Agent shall promptly furnish to
each Lender. Each Lender shall, not less than 15 days and not more than 30 days
prior to the Revolving Termination Date then in effect, notify the Borrower and
the Administrative Agent of its election to extend or not extend the Revolving
Termination Date as requested in such Extension Request, which election shall be
made by each Lender at its absolute discretion. Any
32
Lender which shall not notify the Borrower and the Administrative Agent of its
election to extend the Revolving Termination Date on or prior to the date that
is 15 days prior to the Revolving Termination Date then in effect shall be
deemed to have elected not to extend the Revolving Termination Date as requested
in such Extension Request. Notwithstanding any provision of this Agreement to
the contrary, any notice by any Lender of its willingness to extend the
Revolving Termination Date shall be revocable by such Lender in its sole and
absolute discretion at any time prior to the date which is 15 days prior to the
Revolving Termination Date then in effect. If the Required Lenders shall approve
in writing the extension of the Revolving Termination Date requested in such
Extension Request, the Revolving Termination Date shall automatically and
without any further action by any Person be extended for the period specified in
such Extension Request; provided that (i) each extension pursuant to this
Section 2.18 shall be for a maximum of 364 days and (ii) the Commitment of any
Lender that does not consent in writing to such extension not less than 15 days
and not more than 30 days prior to the Revolving Termination Date then in effect
(an "Objecting Lender") shall, unless earlier terminated in accordance with this
Agreement, expire on the Revolving Termination Date in effect on the date of
such Extension Request (such Revolving Termination Date, if any, referred to as
the "Commitment Expiration Date" with respect to such Objecting Lender). If, not
less than 15 days and not more than 30 days prior to the Revolving Termination
Date then in effect, the Required Lenders shall not approve in writing the
extension of the Revolving Termination Date requested in an Extension Request,
the Revolving Termination Date shall not be extended pursuant to such Extension
Request. The Administrative Agent shall promptly notify (y) the Lenders and the
Borrower of any extension of the Revolving Termination Date pursuant to this
Section 2.18 and (z) the Borrower and any other Lender of any Lender which
becomes an Objecting Lender. At the request of the Borrower, if agreed by all
the Lenders other than the Objecting Lenders, the Maturity Date shall be
extended to the one year anniversary of the Revolving Termination Date, as
extended pursuant hereto.
(b) Subject to possible extension pursuant to the proviso set forth
in Section 2.8(a)(i), Obligations owing to any Objecting Lender on the
Commitment Expiration Date with respect to such Lender shall be repaid in full
on or before such Commitment Expiration Date.
(c) The Borrower shall have the right, so long as no Event of
Default has occurred and is then continuing, (i) upon giving notice to the
Administrative Agent and the Objecting Lenders in accordance with Section 2.9,
to prepay in full the Loans of the Objecting Lenders, together with accrued
interest thereon, any amounts payable pursuant to Sections 2.13, 2.14, 2.15 and
10.3 and any accrued and unpaid facility fee or other amounts payable to them
hereunder, (ii) upon giving not less than three Business Days' notice to the
Objecting Lenders and the Administrative Agent, to cancel the whole or part of
the Commitments of the Objecting Lenders or (iii) upon notice to such Objecting
Lender and the Administrative Agent, to require such Objecting Lender to assign
and delegate, without recourse (in accordance with and subject to the
restrictions contained in, and consents required by, Section 10.4), all of its
interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment).
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each of the Credit Parties represents and warrants to the Lenders
that:
SECTION 3.1. Organization; Powers. Each of the Credit Parties and
the Subsidiaries is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, has the power and authority to
carry on its business as now conducted and, except where the failure to be so,
individually or in the aggregate, would not reasonably be expected to result in
a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required.
SECTION 3.2. Authorization; Enforceability. The Transactions are
within each Credit Party's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. This Agreement has
been duly executed and delivered by each Credit Party and constitutes a legal,
valid and binding obligation of each Credit Party, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.
SECTION 3.3. Governmental Approvals; No Conflicts. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of any Credit Party or any Subsidiary or any order of any Governmental
Authority, (c) will not violate or result in a default under any indenture,
agreement or other instrument (other than those to be terminated on or prior to
the Closing Date) binding upon any Credit Party or any Subsidiary or their
assets, or give rise to a right thereunder to require any payment to be made by
any Credit Party or any Subsidiary, and (d) will not result in the creation or
imposition of any Lien on any asset of any Credit Party or any Subsidiary.
SECTION 3.4. Financial Condition; No Material Adverse Change. (a)
Each Credit Party has heretofore furnished to the Lenders consolidated balance
sheets and statements of income and cash flows (and, in the case of the
Guarantor, of stockholders' equity) as of and for the fiscal year ended April
30, 2004 (A) reported on by KPMG LLP, an independent registered public
accounting firm, in respect of the financial ffs of the Guarantor, and
(B) certified by its chief financial officer, in respect of the financial
statements of the Borrower. Such financial statements present fairly, in all
material respects, the financial position and results of operations and cash
flows of the Borrower and its consolidated Subsidiaries and of the Guarantor and
its consolidated Subsidiaries as of such date and for such period in accordance
with GAAP. Except as set forth on Schedule 3.4(a), neither the Guarantor nor any
of its consolidated Subsidiaries had, at the date of the most recent balance
sheet referred to above, any material Guarantee Obligation, contingent liability
or liability for taxes, or any long-term lease or unusual forward or long-term
commitment, including, without limitation, any interest rate or foreign currency
swap or exchange transaction, which is not reflected in the foregoing statements
34
or in the notes thereto. During the period from April 30, 2004 to and including
the date hereof, and except as disclosed in filings made by the Guarantor with
the U.S. Securities and Exchange Commission pursuant to the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, there has
been no sale, transfer or other disposition by the Guarantor or any of its
consolidated Subsidiaries of any material part of its business or property other
than in the ordinary course of business and no purchase or other acquisition of
any business or property (including any Capital Stock of any other Person),
material in relation to the consolidated financial condition of the Guarantor
and its consolidated Subsidiaries at April 30, 2004.
(b) Since April 30, 2004, there has been no material adverse change
in the business, assets, property or condition (financial or otherwise) of the
Guarantor and its Subsidiaries, taken as a whole.
SECTION 3.5. Properties. (a) Each of the Credit Parties and the
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to its business, except for minor defects in
title that do not interfere with its ability to conduct its business as
currently conducted or to utilize such properties for their intended purposes.
(b) Each of the Credit Parties and the Subsidiaries owns, or is
licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Credit Parties and the Subsidiaries does not infringe upon the rights of any
other Person, except for any such infringements that, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.6. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of any Credit Party, threatened
against or affecting any Credit Party or any Subsidiary that (i) have not been
disclosed in the Disclosed Matters and as to which there is a reasonable
possibility of an adverse determination and that, if adversely determined, would
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect or (ii) challenge or would reasonably be expected to
affect the legality, validity or enforceability of this Agreement.
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect, neither of the Credit Parties
nor any Subsidiary (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
SECTION 3.7. Compliance with Laws and Agreements. Each of the Credit
Parties and the Subsidiaries is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to be so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.
35
SECTION 3.8. Investment and Holding Company Status. Neither of the
Credit Parties nor any of the Subsidiaries is (a) an "investment company" as
defined in, or subject to regulation under, the Investment Company Act of 1940,
as amended, or (b) a "holding company" as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935.
SECTION 3.9. Taxes. Each of the Credit Parties and the Subsidiaries
has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which the Guarantor, the Borrower or such
Subsidiary, as applicable, has set aside on its books adequate reserves or (b)
to the extent that the failure to do so would not reasonably be expected to
result in a Material Adverse Effect.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, would reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $25,000,000 the fair market value of the assets of such Plan, and the
present value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $25,000,000 the fair
market value of the assets of all such underfunded Plans.
SECTION 3.11. Disclosure. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Credit
Parties to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information, the Credit Parties represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.
SECTION 3.12. Federal Regulations. No part of the proceeds of any
Loans will be used for "purchasing" or "carrying" any "margin stock" (within the
respective meanings of each of the quoted terms under Regulation U of the Board
as now and from time to time hereafter in effect) in a manner or in
circumstances that would constitute or result in non-compliance by any Credit
Party or any Lender with the provisions of Regulations U, T or X of the Board.
If requested by any Lender or the Administrative Agent, the Borrower will
furnish to the Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form U-1 referred to in said
Regulation U.
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SECTION 3.13. Subsidiaries. As of the date hereof, the Guarantor has
only the Subsidiaries set forth on Schedule 3.13.
SECTION 3.14. Insurance. Each Credit Party and each Subsidiary of
each Credit Party maintains (pursuant to a self-insurance program and/or with
financially sound and reputable insurers) insurance with respect to its
properties and business and against at least such liabilities, casualties and
contingencies and in at least such types and amounts as is customary in the case
of companies engaged in the same or a similar business or having similar
properties similarly situated.
ARTICLE IV
CONDITIONS
SECTION 4.1. Effective Date. Except as otherwise provided in
Sections 4.2 and 4.3, this Agreement shall become effective on the date on which
each of the following conditions is satisfied (or waived in accordance with
Section 10.2):
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto a counterpart of this Agreement signed on behalf of such
party.
(b) The Lenders and the Administrative Agent shall have received all
fees required to be paid on or prior to the Effective Date.
SECTION 4.2. Closing Date. The obligations of the Lenders to make
Loans (or to purchase participations in Swingline Loans) hereunder shall not
become effective until the date on which each of the following conditions is
satisfied (or waived in accordance with Section 10.2):
(a) The Effective Date shall have occurred.
(b) The Administrative Agent shall have received reasonably
satisfactory written opinions (addressed to the Administrative Agent and the
Lenders and dated the Closing Date) of Mayer, Brown, ▇▇▇▇ & Maw LLP, special New
York counsel for the Credit Parties, and ▇▇▇▇▇ ▇▇▇▇ LLP, special counsel for the
Credit Parties, substantially in the forms of Exhibit B-1 and B-2, respectively,
and covering such other matters relating to the Credit Parties, this Agreement
or the Transactions as the Required Lenders shall reasonably request. The Credit
Parties hereby request such counsel to deliver such opinion.
(c) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably request
relating to the organization, existence and good standing of the Credit Parties,
the authorization of the Transactions and any other legal matters relating to
the Credit Parties, this Agreement or the Transactions, all in form and
substance satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a certificate,
dated the Closing Date and signed by the President, a Vice President or a
Financial Officer of each Credit
37
Party, confirming compliance with the conditions set forth in paragraphs (a) and
(b) of Section 4.3.
(e) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Closing Date, including, to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses required
to be reimbursed or paid by the Borrower hereunder.
(f) The Borrower shall have repaid all obligations owing and
outstanding under the Existing Agreement.
(g) All governmental and material third party approvals necessary in
connection with the execution, delivery and performance of this Agreement shall
have been obtained and be in full force and effect.
The Administrative Agent shall notify the Borrower and the Lenders of the
Closing Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans (or to purchase
participations in Swingline Loans) hereunder shall not become effective unless
each of the foregoing conditions is satisfied (or waived pursuant to Section
10.2) at or prior to the Effective Date. Upon the Effective Date, all Lenders
under the Existing Agreement that have not become parties hereto on or prior to
the Effective Date shall no longer be Lenders hereunder, and the Commitments as
of the Effective Date shall be as set forth on Schedule 2.1 hereto.
SECTION 4.3. Each Loan. The obligation of each Lender to make a Loan
on the occasion of any Borrowing is subject to the satisfaction of the following
conditions:
(a) The representations and warranties of the Credit Parties set
forth in Article III of this Agreement (other than the representations and
warranties set forth in subsections 3.4(b), 3.6(a)(i) and 3.6(b)) shall be true
and correct in all material respects on and as of the date of such Borrowing
(except to the extent related to a specific earlier date).
(b) At the time of and immediately after giving effect to such
Borrowing, no Default shall have occurred and be continuing.
Each Borrowing shall be deemed to constitute a representation and warranty by
each of the Credit Parties on the date thereof as to the matters specified in
paragraphs (a) and (b) of this Section.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full, each of the Credit Parties covenants and agrees with the
Lenders that:
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SECTION 5.1. Financial Statements and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the
Guarantor, an audited consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows of the Guarantor and its
consolidated Subsidiaries as of the end of and for such year, setting forth in
each case in comparative form the figures for the previous fiscal year, all
reported on by KPMG LLP or other another independent registered public
accounting firm of recognized national standing (without a "going concern" or
like qualification or exception and without any qualification or exception as to
the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition and
results of operations of the Guarantor and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied;
(b) (i) in the case of the Guarantor, within 45 days after the end
of each of the first three fiscal quarters of each fiscal year of the Guarantor
and (ii) in the case of the Borrower, within 90 days after the end of each
fiscal year of the Borrower, consolidated balance sheets and related statements
of operations and cash flows of the Borrower and the Guarantor and their
consolidated Subsidiaries, and the consolidated statement of stockholders'
equity of the Guarantor, as of the end of and for such fiscal quarter (in the
case of the Guarantor) and the then elapsed portion of the fiscal year, setting
forth in each case in comparative form the figures for the corresponding period
or periods of (or, in the case of the balance sheet, as of the end of) the
previous fiscal year, all certified by a Financial Officer of the Borrower and
the Guarantor as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and the Guarantor and their
consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the Borrower
and the Guarantor (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth reasonably
detailed calculations demonstrating compliance with Section 6.1 and (iii)
stating whether any change in GAAP or in the application thereof has occurred
since the date of the audited financial statements referred to in Section 3.4
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate;
(d) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials (other than
routine filings by (i) HRB Financial Corporation and its Subsidiaries, including
H&R Block Financial Advisors, Inc., (ii) RSM McGladrey, Inc. and its
Subsidiaries, including Birchtree Financial Services, Inc., (iii) RSM Equico,
Inc. and its Subsidiaries, including RSM Equico Capital Markets, LLC, (iv)
Option One Mortgage Corporation, (v) H&R Block Canada, Inc. and (vi) H&R Block
Limited) filed by any Credit Party or any Subsidiary with the Securities and
Exchange Commission, or any Governmental Authority succeeding to any or all of
the functions of said Commission, or with any national securities exchange, or
distributed by any Credit Party to its shareholders generally, as the case may
be; and
39
(e) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of any Credit
Party or any Subsidiary, or compliance with the terms of this Agreement, as the
Administrative Agent or any Lender may reasonably request.
SECTION 5.2. Notices of Material Events. The Borrower will furnish
to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting any
Credit Party or any Affiliate thereof that is reasonably likely to be adversely
determined and, if so determined, would reasonably be expected to result in a
Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, would reasonably be expected to
result in liability of the Borrower, the Guarantor or any Subsidiary in an
aggregate amount exceeding $25,000,000; and
(d) any other development that results in, or would reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower and the Guarantor
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.
SECTION 5.3. Existence; Conduct of Business. Each Credit Party will,
and will cause each of the Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation, disposition or dissolution permitted
under Section 6.4.
SECTION 5.4. Payment of Taxes. Each Credit Party will, and will
cause each of the Subsidiaries to, pay its Tax liabilities that, if not paid,
would reasonably be expected to have a Material Adverse Effect before the same
shall become delinquent, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) such Credit Party
or such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment pending such
contest would not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.5. Maintenance of Properties; Insurance. Each Credit Party
will, and will cause each of the Subsidiaries to, (a) keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain (pursuant to a
self-insurance program and/or with financially sound and reputable insurers)
insurance in such amounts and against such risks as is customarily maintained
40
by companies engaged in the same or similar businesses operating in the same or
similar locations.
SECTION 5.6. Books and Records; Inspection Rights. Each Credit Party
will, and will cause each of the Subsidiaries to, keep proper books of record
and account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. Each Credit Party will,
and will cause each of the Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from
its books and records, and to discuss its affairs, finances and condition with
its officers and independent accountants, all at such reasonable times and as
often as reasonably requested; provided that so long as no Event of Default
exists, each Credit Party and each Subsidiary shall have the right to be present
and participate in any discussions with its independent accountants. Nothing in
this Section 5.6 shall permit the Administrative Agent or any Lender to examine
or otherwise have access to the tax returns or other confidential information of
any customer of either Credit Party or any of their respective Subsidiaries.
SECTION 5.7. Compliance with Laws. Each Credit Party will, and will
cause each of the Subsidiaries to, comply with all laws, rules, regulations and
orders of any Governmental Authority applicable to it or its property, except
where the failure to do so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.8. Use of Proceeds. The proceeds of the Loans will be used
only for paying at maturity commercial paper issued by the Borrower from time to
time, for general corporate purposes and for working capital needs. No part of
the proceeds of any Loan will be used, whether directly or indirectly, for any
purpose that entails a violation of any of the Regulations of the Board,
including Regulations U and X.
SECTION 5.9. Cleandown. During the period from March 1 to June 30 of
each fiscal year, the Credit Parties shall reduce the aggregate outstanding
principal amount of all their Short-Term Debt to $200,000,000 or less for a
minimum period of thirty consecutive days.
ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal
of and interest on each Loan and all fees payable hereunder have been paid in
full, each of the Credit Parties covenants and agrees with the Lenders that:
SECTION 6.1. Adjusted Net Worth. The Guarantor will not permit
Adjusted Net Worth as at the last day of any fiscal quarter of the Guarantor to
be less than $1,000,000,000.
SECTION 6.2. Indebtedness. The Credit Parties will not, and will not
permit any Subsidiary to create, incur, assume or permit to exist any
Indebtedness, except:
41
(a) subject to the proviso at the end of this Section 6.2,
Indebtedness created hereunder;
(b) (i) Indebtedness existing on the date hereof and set forth in
Schedule 6.2 and extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof and (ii) subject
to the proviso at the end of Section 6.2, Indebtedness under the Other Credit
Agreement;
(c) seasonal Indebtedness of H&R Block Canada, Inc., provided that
the aggregate principal amount of all such Indebtedness incurred pursuant to
this subsection (c) shall not exceed 250,000,000 Canadian dollars at any time
outstanding;
(d) Indebtedness of the Borrower and the Guarantor, provided that
(i) the obligations of the Credit Parties hereunder shall rank at least pari
passu with such Indebtedness (including with respect to security) and (ii) the
aggregate principal amount of all Indebtedness permitted by this subsection (d)
shall not exceed $2,000,000,000 at any time outstanding;
(e) subject to the proviso at the end of this Section 6.2, (i)
Indebtedness in connection with commercial paper issued in the United States
through the Borrower which is guaranteed by the Guarantor and (ii) Indebtedness
under bank lines of credit or similar facilities;
(f) Indebtedness in connection with Guarantees of the performance of
any Subsidiary's obligations under or pursuant to (i) indemnity, fee, daylight
overdraft and other similar customary banking arrangements between such
Subsidiary and one or more financial institutions in the ordinary course of
business, (ii) any office lease entered into in the ordinary course of business,
and (iii) any promotional, joint-promotional, cross-promotional, joint
marketing, service, equipment or supply procurement, software license or other
similar agreement entered into by such Subsidiary with one or more vendors,
suppliers, retail businesses or other third parties in the ordinary course of
business, including, but not limited to, indemnification obligations relating to
such Subsidiary's failure to perform its obligations under such lease or
agreement;
(g) acquisition-related Indebtedness (either incurred or assumed)
and Indebtedness in connection with the Guarantor's guarantees of the payment or
performance of primary obligations of Subsidiaries of the Guarantor in
connection with acquisitions by such Subsidiaries, or Indebtedness secured by
Liens permitted under subsection 6.3(f); provided that, during any fiscal year,
the aggregate outstanding principal amount of all Indebtedness incurred pursuant
to this subsection 6.2(g) shall not exceed at any time $325,000,000;
(h) Indebtedness of any Credit Party to any other Credit Party, of
any Credit Party to any Subsidiary, of any Subsidiary to any Credit Party and of
any Subsidiary to any other Subsidiary; provided that such Indebtedness shall
not be prohibited by Section 6.5;
(i) Indebtedness in connection with repurchase agreements pursuant
to which mortgage loans of a Credit Party or a Subsidiary are sold with the
simultaneous agreement to repurchase the mortgage loans at the same price plus
interest at an agreed upon rate; provided that the aggregate outstanding
principal amount of all Indebtedness incurred pursuant to this
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subsection 6.2(i) shall not at any time exceed $500,000,000; provided, further,
that no agreed upon repurchase date shall be later than 90 business days after
the date of the corresponding repurchase agreement;
(j) Indebtedness in connection with Guarantees or Guarantee
Obligations which are made, given or undertaken as representations and
warranties, indemnities or assurances of the payment or performance of primary
obligations in connection with securitization transactions or other transactions
permitted hereunder, as to which primary obligations the primary obligor is a
Credit Party, a Subsidiary or a securitization trust or similar securitization
vehicle to which a Credit Party or a Subsidiary sold, directly or indirectly,
the relevant mortgage loans;
(k) Indebtedness of RSM, a Subsidiary of the Guarantor, to McGladrey
& ▇▇▇▇▇▇, LLP ("M&P") and certain related trusts under (i) that certain Asset
Purchase Agreement dated as of June 28, 1999 among RSM, M&P, the Guarantor and
certain other parties signatory thereto (the "M&P Purchase Agreement") and (ii)
the Retired Partners Agreement and the Loan Agreement (as such terms are defined
in the M&P Purchase Agreement); provided that the aggregate outstanding
principal amount payable in respect of such Indebtedness permitted under this
paragraph (k) shall not exceed $200,000,000 at any time;
(l) Indebtedness in connection with (i) Capital Lease Obligations in
an aggregate outstanding principal amount not at any time exceeding $50,000,000
(excluding any Capital Lease Obligations permitted by subsection 6.2(p)), (ii)
obligations under existing mortgages in an aggregate outstanding principal
amount not exceeding $12,000,000 at any time, (iii) securities sold and not yet
purchased, provided that the aggregate outstanding principal amount of all
Indebtedness incurred pursuant to this clause (iii) (other than Indebtedness of
Subsidiaries which act as broker-dealers) shall not at any time exceed
$15,000,000, (iv) customer deposits in the ordinary course of business, (v)
payables to brokers and dealers in the ordinary course of business and (vi)
reimbursement obligations of broker-dealers relating to letters of credit in
favor of a clearing corporation or Indebtedness of broker-dealers under other
credit facilities, provided that (A) such letters of credit or such other credit
facilities are used solely to satisfy margin deposit requirements and (B) the
aggregate outstanding exposure of the Guarantor and the Subsidiaries under all
such letters of credit and all such other credit facilities shall not exceed
$200,000,000 at any time;
(m) subject to the proviso at the end of this Section 6.2,
Indebtedness in an aggregate outstanding principal amount not to exceed
$1,500,000,000; provided, however, that (i) the proceeds of such Indebtedness
are used solely in connection with the Borrower's Refund Anticipation Loans
Program, (ii) such Indebtedness is incurred during the period beginning on
January 15 of any year and ending on March 15 of such year, (iii) such
Indebtedness is repaid in full by the earlier of March 15 the year in which such
Indebtedness is incurred and (iv) the covenants contained in any agreement
relating to such Indebtedness, or guarantee thereof (other than covenants
specific to the Borrower's Refund Anticipation Loan Program and the operation
thereof), are no more restrictive than the covenants contained in this
Agreement;
(n) subject to the proviso at the end of this Section 6.2,
liabilities related to the RAL Receivables Transactions to the extent consistent
with the definition thereof; and
43
(o) Indebtedness in respect of letters of credit in an aggregate
outstanding principal amount not to exceed $25,000,000;
(p) Indebtedness in an amount not exceeding $150,000,000 in
connection with the acquisition, development or construction of the Guarantor's
new headquarters;
(q) deposits and other liabilities incurred by banking Subsidiaries
in the ordinary course of business;
(r) customary liabilities of broker-dealers incurred by
broker-dealer Subsidiaries in the ordinary course of business;
(s) Indebtedness issued by a Subsidiary of the Borrower and
primarily secured by mortgage loans sold as contemplated by Section 6.5(c)
hereof to such Subsidiary by another Subsidiary of the Borrower; and
(t) Indebtedness secured by Liens permitted by subsection 6.3(d) or
6.3(e);
provided, that the sum of the aggregate outstanding principal amount of all
Indebtedness permitted pursuant to subsections 6.2(a), 6.2(b)(ii), 6.2(e) and
6.2(m) plus the RAL Receivables Amount shall not at any time exceed the greater
of (x) the Total Facility Commitments then in effect or (y) the sum of the then
outstanding principal amount of the Loans hereunder and the then outstanding
principal amount of the "Loans" under the Other Credit Agreement (such sum, the
"Total Facility Loan Outstandings"), except that, during the period from January
15 of any year to March 15 of such year, such sum may exceed the greater of the
Total Facility Commitments then in effect or the then Total Facility Loan
Outstandings by up to $1,500,000,000.
SECTION 6.3. Liens. Each Credit Party will not, and will not permit
any Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any
income or revenues (including accounts receivable) or rights in respect of any
thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of any Credit Party or any
Subsidiary existing on the date hereof and set forth in Schedule 6.3; provided
that (i) such Lien shall not apply to any other property or asset of any Credit
Party or any Subsidiary and (ii) such Lien shall secure only those obligations
which it secures on the date hereof and extensions, renewals and replacements
thereof that do not increase the outstanding principal amount thereof;
(c) any Lien existing on any property or asset prior to the
acquisition thereof by any Credit Party or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (i) such Lien
is not created in contemplation of or in connection with such acquisition or
such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not
apply to any other property or assets of any Credit Party or any Subsidiary and
(iii) such Lien
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shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be,
and extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(d) Liens and transfers in connection with the securitization,
financing or other transfer of any mortgage loans or mortgage servicing
reimbursement rights (and/or, in each case, related rights, interests and
servicing assets) owned by the Borrower or any of its Subsidiaries;
(e) Liens and transfers in connection with the securitization or
other transfer of any credit card receivables (and/or related rights and
interests) owned by the Borrower or any of its Subsidiaries;
(f) Liens on fixed or capital assets acquired, constructed or
improved by any Credit Party or any Subsidiary to secure Indebtedness of such
Credit Party or such Subsidiary incurred to finance the acquisition,
construction or improvement of such fixed or capital assets; provided that (i)
such Liens and the Indebtedness secured thereby are incurred prior to or within
90 days after such acquisition or the completion of such construction or
improvement, (ii) the Indebtedness secured thereby does not exceed 100% of the
cost of acquiring, constructing or improving such fixed or capital assets and
(iii) such Liens shall not apply to any other property or assets of any Credit
Party or any Subsidiary;
(g) Liens arising in connection with repurchase agreements
contemplated by Section 6.2(i); provided that such security interests shall not
apply to any property or assets of any Credit Party or any Subsidiary except for
the mortgage loans or securities, as applicable, subject to such repurchase
agreements;
(h) Liens arising in connection with Indebtedness permitted by
Sections 6.2(l)(v) or 6.2(q), which Liens are granted in the ordinary course of
business;
(i) Liens not otherwise permitted by this Section 6.3 so long as the
Obligations hereunder are contemporaneously secured equally and ratably with the
obligations secured thereby;
(j) Liens not otherwise permitted by this Section 6.3, so long as
the aggregate outstanding principal amount of the obligations secured thereby
does not exceed (as to the Credit Parties and all Subsidiaries) $250,000,000 at
any one time;
(k) Liens and transfers in connection with the RAL Receivables
Transaction; and
(l) Liens on Unrestricted Margin Stock.
SECTION 6.4. Fundamental Changes; Sale of Assets. (a) Each Credit
Party will not, and will not permit any Material Subsidiary to, merge into or
consolidate with any other Person, or permit any other Person to merge into or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all of its
45
assets (other than Unrestricted Margin Stock), or all or substantially all of
the stock or assets related to its tax preparation business or liquidate or
dissolve, except (i) transfers in connection with the RAL Receivables
Transaction and other securitizations otherwise permitted hereby, (ii) sales and
other transfers of mortgage loans (and/or related rights and interests and
servicing assets) and (iii) if at the time thereof and immediately after giving
effect thereto no Default shall have occurred and be continuing, (A) any
Material Subsidiary other than the Borrower may merge into a Credit Party in a
transaction in which the Credit Party is the surviving corporation, (B) any
wholly owned Material Subsidiary other than the Borrower may merge into any
other wholly owned Material Subsidiary in a transaction in which the surviving
entity is a wholly owned Subsidiary, (C) any Material Subsidiary other than the
Borrower may sell, transfer, lease or otherwise dispose of its assets to the
Guarantor or to another Material Subsidiary and (D) any Material Subsidiary
other than the Borrower may liquidate or dissolve if the Guarantor determines in
good faith that such liquidation or dissolution is in the best interests of the
Guarantor and is not materially disadvantageous to the Lenders; provided that
any such merger involving a Person that is not a wholly owned Subsidiary
immediately prior to such merger shall not be permitted unless also permitted by
Section 6.5.
(b) Except as set forth on Schedule 6.4(b), the Credit Parties will
not, and will not permit any Material Subsidiary to, engage to any material
extent in any business other than businesses of the type conducted by the Credit
Parties and the Subsidiaries on the date of execution of this Agreement and
businesses reasonably related thereto.
SECTION 6.5. Transactions with Affiliates. Each Credit Party will
not, and will not permit any Subsidiary to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to such Credit Party or such Subsidiary than
could be obtained on an arm's-length basis from unrelated third parties, (b)
transactions between or among the Guarantor and/or its Subsidiaries not
involving any other Affiliate, and (c) transactions involving the transfer of
mortgage loans and other assets for cash and other consideration of not less
than the sum of (i) the lesser of (x) the fair market value of such mortgage
loans and (y) the outstanding principal amount of such mortgage loans, and (ii)
the fair market value of such other assets, to a Subsidiary of the Borrower that
issues Indebtedness permitted by Section 6.2(s).
SECTION 6.6. Restrictive Agreements. The Credit Parties will not,
and will not permit any Subsidiary to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that by its terms
prohibits, restricts or imposes any condition upon (a) the ability of any Credit
Party or any Subsidiary to create, incur or permit to exist any Lien upon any of
its material property or assets (unless such agreement or arrangement does not
prohibit, restrict or impose any condition upon the ability of either Credit
Party or any Subsidiary to create, incur or permit to exist any Lien in favor of
the Administrative Agent or any Lender created hereunder), or (b) the ability of
any Subsidiary to pay dividends or other distributions with respect to any
shares of its capital stock or to make or repay loans or advances to the
Guarantor or any other Subsidiary or to Guarantee Indebtedness of the Guarantor
or any other Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed
46
by law or by this Agreement, (ii) the foregoing shall not apply to restrictions
and conditions existing on the date hereof identified on Schedule 6.6 (but shall
apply to any extension, renewal, amendment or modification expanding the scope
of any such restriction or condition), (iii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the
securitization, financing or other transfer of mortgage loans (and/or related
rights and interests and servicing assets) owned by the Borrower or any of its
Subsidiaries, (v) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement relating to secured obligations permitted by
this Agreement (including obligations secured by Liens permitted by Section
6.3(j)) if such restrictions or conditions apply only to the property or assets
securing such obligations, (vi) clause (a) of the foregoing shall not apply to
customary provisions in leases and other contracts restricting the assignment
thereof and (vii) clause (a) of the foregoing shall not apply to restrictions or
conditions imposed by any agreement relating to Indebtedness permitted hereunder
pursuant to subsection 6.2(m) or the RAL Receivables Transaction.
ARTICLE VII
GUARANTEE
SECTION 7.1. Guarantee. (a) The Guarantor hereby unconditionally and
irrevocably guarantees to the Administrative Agent and the Lenders and their
respective successors, indorsees, transferees and assigns, the prompt and
complete payment and performance by the Borrower when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations.
(b) The Guarantor further agrees to pay any and all expenses
(including, without limitation, all fees and disbursements of counsel) which may
be paid or incurred by the Administrative Agent or any Lender in enforcing, or
obtaining advice of counsel in respect of, any rights with respect to, or
collecting, any or all of the Obligations and/or enforcing any rights with
respect to, or collecting against, the Guarantor under this Article. This
Article shall remain in full force and effect until the Obligations and the
obligations of the Guarantor under the guarantee contained in this Article shall
have been satisfied by payment in full and the Commitments shall be terminated,
notwithstanding that from time to time prior thereto the Borrower may be free
from any Obligations.
(c) No payment or payments made by any Credit Party, any other
guarantor or any other Person or received or collected by the Administrative
Agent or any Lender from any Credit Party or any other Person by virtue of any
action or proceeding or any set-off or appropriation or application, at any time
or from time to time, in reduction of or in payment of the Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of the
Guarantor hereunder which shall, notwithstanding any such payment or payments,
remain liable hereunder for the Obligations until the Obligations are paid in
full and the Commitments are terminated.
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(d) The Guarantor agrees that whenever, at any time or from time to
time, it shall make any payment to the Administrative Agent or any Lender on
account of its liability hereunder, it will notify the Administrative Agent and
such Lender in writing that such payment is made under this Article for such
purpose.
SECTION 7.2. Delay of Subrogation. Notwithstanding any payment or
payments made by the Guarantor hereunder, or any set-off or application of funds
of the Guarantor by the Administrative Agent or any Lender, the Guarantor shall
not be entitled to be subrogated to any of the rights of the Administrative
Agent or any Lender against the Borrower or against any collateral security or
guarantee or right of offset held by the Administrative Agent or any Lender for
the payment of the Obligations, nor shall the Guarantor seek or be entitled to
seek any contribution or reimbursement from the Borrower in respect of payments
made by the Guarantor hereunder, until all amounts owing to the Administrative
Agent and the Lenders by the Borrower on account of the Obligations are paid in
full and the Commitments are terminated. If any amount shall be paid to the
Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by the
Guarantor in trust for the Administrative Agent and the Lenders, segregated from
other funds of the Guarantor, and shall, forthwith upon receipt by the
Guarantor, be turned over to the Administrative Agent in the exact form received
by the Guarantor (duly indorsed by the Guarantor to the Administrative Agent, if
required) to be applied against the Obligations, whether matured or unmatured,
in such order as the Administrative Agent may determine. The provisions of this
Section shall be effective notwithstanding the termination of this Agreement and
the payment in full of the Obligations and the termination of the Commitments.
48
SECTION 7.3. Amendments, etc. with respect to the Obligations;
Waiver of Rights. The Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against the Guarantor, and without
notice to or further assent by the Guarantor, any demand for payment of any of
the Obligations made by the Administrative Agent or any Lender may be rescinded
by the Administrative Agent or such Lender, and any of the Obligations
continued, and the Obligations, or the liability of any other party upon or for
any part thereof, or any collateral security or guarantee therefor or right of
offset with respect thereto, may, from time to time, in whole or in part, be
renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or any Lender, and this
Agreement and any other documents executed and delivered in connection herewith
may be amended, modified, supplemented or terminated, in whole or in part, in
accordance with the provisions hereof as the Administrative Agent (or the
requisite Lenders, as the case may be) may deem advisable from time to time, and
any collateral security, guarantee or right of offset at any time held by the
Administrative Agent or any Lender for the payment of the Obligations may be
sold, exchanged, waived, surrendered or released. Neither the Administrative
Agent nor any Lender shall have any obligation to protect, secure, perfect or
insure any Lien at any time held by it as security for the Obligations or for
this Agreement or any property subject thereto. When making any demand hereunder
against the Guarantor, the Administrative Agent or any Lender may, but shall be
under no obligation to, make a similar demand on the Borrower or any other
guarantor, and any failure by the Administrative Agent or any Lender to make any
such demand or to collect any payments from the Borrower or any such other
guarantor or any release of the Borrower or such other guarantor shall not
relieve the Guarantor of its obligations or liabilities hereunder, and shall not
impair or affect the rights and remedies, express or implied, or as a matter of
law, of the Administrative Agent or any Lender against the Guarantor. For the
purposes hereof "demand" shall include the commencement and continuance of any
legal proceedings.
SECTION 7.4. Guarantee Absolute and Unconditional. The Guarantor
waives any and all notice of the creation, renewal, extension or accrual of any
of the Obligations and notice of or proof of reliance by the Administrative
Agent or any Lender upon this Agreement or acceptance of this Agreement; the
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred, or renewed, extended, amended or waived, in reliance
upon this Agreement; and all dealings between the Borrower and the Guarantor, on
the one hand, and the Administrative Agent and the Lenders, on the other, shall
likewise be conclusively presumed to have been had or consummated in reliance
upon this Agreement. The Guarantor waives diligence, presentment, protest,
demand for payment and notice of default or nonpayment to or upon the Borrower
and the Guarantor with respect to the Obligations. This Article shall be
construed as a continuing, absolute and unconditional guarantee of payment
without regard to (a) the validity, regularity or enforceability of this
Agreement, any other documents executed and delivered in connection herewith,
any of the Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by
the Administrative Agent or any Lender, (b) any defense, set-off or counterclaim
(other than a defense of payment or performance) which may at any time be
available to or be asserted by the Guarantor against the Administrative Agent or
any Lender, or (c) any other circumstance whatsoever (with or without notice to
or knowledge of the Borrower or the Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the Borrower
49
for the Obligations, or of the Guarantor under this Article, in bankruptcy or in
any other instance. When pursuing its rights and remedies hereunder against the
Guarantor, the Administrative Agent and any Lender may, but shall be under no
obligation to, pursue such rights and remedies as it may have against the
Borrower or any other Person or against any collateral security or guarantee for
the Obligations or any right of offset with respect thereto, and any failure by
the Administrative Agent or any Lender to pursue such other rights or remedies
or to collect any payments from the or any such other Person or to realize upon
any such collateral security or guarantee or to exercise any such right of
offset, or any release of the Borrower or any such other Person or of any such
collateral security, guarantee or right of offset, shall not relieve the
Guarantor of any liability hereunder, and shall not impair or affect the rights
and remedies, whether express, implied or available as a matter of law, of the
Administrative Agent or any Lender against the Guarantor. This Article shall
remain in full force and effect and be binding in accordance with and to the
extent of its terms upon the Guarantor and its successors and assigns, and shall
inure to the benefit of the Administrative Agent and the Lenders, and their
respective successors, indorsees, transferees and assigns, until all the
Obligations and the obligations of the Guarantor under this Agreement shall have
been satisfied by payment in full and the Commitments shall be terminated,
notwithstanding that from time to time during the term of this Agreement the
Borrower may be free from any Obligations.
SECTION 7.5. Reinstatement. This Article shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by the Administrative Agent or any Lender upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of any Credit
Party or upon or as a result of the appointment of a receiver, intervenor or
conservator of, or trustee or similar officer for, any Credit Party or any
substantial part of its property, or otherwise, all as though such payments had
not been made.
SECTION 7.6. Payments. The Guarantor hereby agrees that all payments
required to be made by it hereunder will be made to the Administrative Agent
without set-off or counterclaim in accordance with the terms of the Obligations,
including, without limitation, in the currency in which payment is due.
ARTICLE VIII
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan when
and as the same shall become due and payable, whether at the due date thereof or
at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of this
Article) payable under this Agreement, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five
business days;
50
(c) any representation or warranty made or deemed made by any Credit
Party (or any of its officers) in or in connection with this Agreement or any
amendment or modification hereof, or in any report, certificate, financial
statement or other document furnished pursuant to or in connection with this
Agreement or any amendment or modification hereof, shall prove to have been
incorrect in any material respect when made or deemed made;
(d) any Credit Party shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.2, 5.3 (with respect to the Credit
Parties' existence), 5.8 or 5.9 or in Article VI;
(e) any Credit Party shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those specified
in clause (a), (b) or (d) of this Article), and such failure shall continue
unremedied for a period of 30 days after notice thereof from the Administrative
Agent (given at the request of any Lender) to the Borrower;
(f) any Credit Party or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount) in respect
of any Material Indebtedness, when and as the same shall become due and payable
(after expiration of any applicable grace or cure period);
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity; provided that this
clause (g) shall not apply to (i) secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing such
Indebtedness or (ii) any obligation under a Hedging Agreement that becomes due
as a result of a default by a party thereto other than a Credit Party or a
Subsidiary;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of any Credit Party or any Material Subsidiary or its debts, or of a
substantial part of its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any Credit Party or any Material Subsidiary or for a
substantial part of its assets, and, in any such case, such proceeding or
petition shall continue undismissed for 60 days or an order or decree approving
or ordering any of the foregoing shall be entered;
(i) any Credit Party or any Material Subsidiary shall (i)
voluntarily commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner,
any proceeding or petition described in clause (h) of this Article, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or any Material
Subsidiary or for a substantial part of its assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors or (vi)
take any action for the purpose of effecting any of the foregoing;
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(j) any Credit Party or any Material Subsidiary shall become unable,
admit in writing or fail generally to pay its debts as they become due;
(k) one or more final judgments for the payment of money shall be
rendered against the Guarantor, the Borrower, any Subsidiary or any combination
thereof and either (i) a creditor shall have commenced enforcement proceedings
upon any such judgment in an aggregate amount (to the extent not covered by
insurance as to which the relevant insurance company has not denied coverage) in
excess of $40,000,000 (a "Material Judgment") or (ii) there shall be a period of
30 consecutive days during which a stay of enforcement of any Material Judgment
shall not be in effect (by reason of pending appeal or otherwise) (it being
understood that, notwithstanding the definition of "Default", no "Default" shall
be triggered solely by the rendering of such a judgment or judgments prior to
the commencement of enforcement proceedings or the lapse of such 30 consecutive
day period, so long as such judgments are capable of satisfaction by payment at
any time);
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that have
occurred, would reasonably be expected to result in a Material Adverse Effect;
(m) a Change in Control shall occur; or
(n) the Guarantee contained in Article VII herein shall cease, for
any reason, to be in full force and effect in any material respect or any Credit
Party shall so assert;
then, and in every such event (other than an event with respect to the Credit
Parties described in clause (h) or (i) of this Article), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Borrower,
take either or both of the following actions, at the same or different times:
(i) terminate the Commitments, and thereupon the Commitments shall terminate
immediately, and (ii) declare the Loans then outstanding to be due and payable
in whole (or in part, in which case any principal not so declared to be due and
payable may thereafter be declared to be due and payable), and thereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other Obligations of the Credit Parties
accrued hereunder, shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Credit Parties; and in case of any event with respect to
the Credit Parties described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
Obligations of the Credit Parties accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Credit Parties.
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ARTICLE IX
THE ADMINISTRATIVE AGENT
Each of the Lenders hereby irrevocably appoints the Administrative
Agent as its agent and authorizes the Administrative Agent to take such actions
on its behalf and to exercise such powers as are delegated to the Administrative
Agent by the terms hereof, together with such actions and powers as are
reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
bank and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required to exercise in writing by the Required Lenders, and (c) except as
expressly set forth herein, the Administrative Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to any Credit Party or any Subsidiary that is communicated to or
obtained by the bank serving as Administrative Agent or any of its Affiliates in
any capacity. The Administrative Agent shall not be liable for any action taken
or not taken by it with the consent or at the request of the Required Lenders
(or when expressly required hereby, all the Lenders) or in the absence of its
own gross negligence or willful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by any Credit Party or a Lender,
and the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to be
genuine and to have been signed or sent by the proper Person. The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any
liability for relying thereon. The Administrative Agent may consult with legal
counsel (who may be counsel for any Credit Party), independent accountants and
other experts selected by it, and shall
53
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all of its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and of all its duties and exercise its rights and
powers through their respective Related Parties. The exculpatory provisions of
the preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, with the consent of the
Borrower (which consent shall not be unreasonably withheld), to appoint a
successor. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent which shall be a bank with an office in New York, New York,
or an Affiliate of any such bank. Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 10.3 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any related agreement or any document furnished hereunder or thereunder.
Notwithstanding anything to the contrary contained in this
Agreement, the parties hereto hereby agree that no agent (other than the
Administrative Agent) shall have any rights, duties or responsibilities in its
capacity as agent hereunder and that no agent (other than the Administrative
Agent) shall have the authority to take any action hereunder in its capacity as
such.
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54
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower or the Guarantor, to it at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Telecopy No. (816)
753-8538), ▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇) and ▇▇▇▇▇▇▇ ▇▇▇▇ (Telecopy
No. (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Administrative Agent or the Swingline Lender, to
JPMorgan Chase Bank, Loan and Agency Services Group, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇),
with a copy to JPMorgan Chase Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇); and
(c) if to any Lender, to it at its address (or telecopy number) set
forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
Notices and other communications to the Lenders hereunder may be posted to
Intralinks or a similar website or delivered by electronic communications
pursuant to procedures approved by the Administrative Agent; provided that the
foregoing shall not apply to notices pursuant to Section 2 unless otherwise
agreed by the Administrative Agent and the applicable Lender. The Administrative
Agent, the Borrower or the Guarantor may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.
SECTION 10.2. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by the Credit
Parties therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan
shall not be
55
construed as a waiver of any Default, regardless of whether the Administrative
Agent or any Lender may have had notice or knowledge of such Default at the
time.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Credit Parties and the Required Lenders or by the Credit
Parties and the Administrative Agent with the consent of the Required Lenders;
provided that no such agreement shall (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of
any Loan or reduce the rate of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Lender affected thereby, (iii)
postpone the scheduled date of payment of the principal amount of any Loan, or
any interest thereon, or any fees payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of expiration
of any Commitment, without the written consent of each Lender affected thereby,
(iv) change Section 2.16(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby, without the written consent of each
Lender, (v) release the guarantee contained in Article VII, without the written
consent of each Lender or (vi) change any of the provisions of this Section or
the definition of "Required Lenders" or any other provision hereof specifying
the number or percentage of Lenders required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender; provided, further, that no such
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or the Swingline Lender hereunder without the prior written
consent of the Administrative Agent or the Swingline Lender, as the case may be.
SECTION 10.3. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the syndication of the credit facilities provided for herein, the preparation
and administration of this Agreement and any amendments, modifications or
waivers of the provisions hereof (whether or not the transactions contemplated
hereby or thereby shall be consummated) and (ii) all out-of-pocket expenses
incurred by the Administrative Agent, or any Lender, including the fees, charges
and disbursements of any counsel for the Administrative Agent, or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made hereunder, including in connection with any workout,
restructuring or negotiations in respect thereof.
(b) The Credit Parties shall jointly and severally indemnify the
Administrative Agent and each Lender, and each Related Party of any of the
foregoing Persons (each such Person being called an "Indemnitee"), against, and
hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnitee, incurred by or asserted against any
Indemnitee arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement or any agreement or instrument
contemplated hereby, the performance by the parties hereto of their respective
obligations hereunder or the consummation of the Transactions or any other
transactions contemplated hereby, (ii) any Loan or the use of the proceeds
therefrom, (iii) any
56
actual or alleged presence or release of Hazardous Materials on or from any
property owned or operated by the Credit Parties or any Subsidiaries, or any
Environmental Liability related in any way to the Credit Parties or any
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee and each Related
Party of such Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or any of its Related
Parties.
(c) To the extent that any Credit Party fails to pay any amount
required to be paid by it to the Administrative Agent or the Swingline Lender
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Administrative Agent or the Swingline Lender, as the case may be, such
Lender's Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent or the Swingline Lender in its capacity as
such. The Administrative Agent or the Swingline Lender shall have the right to
deduct any amount owed to it by any Lender under this paragraph (c) from any
payment made by it to such Lender hereunder.
(d) To the extent permitted by applicable law, the Credit Parties
shall not assert, and hereby waive, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or
as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable promptly
after written demand therefor.
SECTION 10.4. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that no
Credit Party may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by any Credit Party without such consent shall be null
and void). Nothing in this Agreement, expressed or implied, shall be construed
to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent and
the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it); provided that (i)
except in the case of an assignment to a Lender or an Affiliate of a Lender,
each of the Borrower and the Administrative Agent (and, in the case of an
assignment of all or a portion of a Commitment or any Lender's obligations in
57
respect of its Swingline Exposure, the Swingline Lender) must give its prior
written consent to such assignment (which consent shall not be unreasonably
withheld), (ii) except in the case of an assignment to a Lender or an Affiliate
of a Lender or an assignment of the entire remaining amount of the assigning
Lender's Commitment, the amount of the Commitment of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the Administrative
Agent) shall not be less than $5,000,000 unless each of the Borrower and the
Administrative Agent otherwise consent, (iii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement, (iv) the parties to each assignment
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance, together with a processing and recordation fee of $3,500, and (v)
the assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire; provided, further, that any consent of
the Borrower otherwise required under this paragraph shall not be required if an
Event of Default has occurred and is continuing. Upon acceptance and recording
pursuant to paragraph (d) of this Section, from and after the effective date
specified in each Assignment and Acceptance, the assignee thereunder shall be a
party hereto and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.13, 2.14, 2.15 and 10.3). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive, and each Credit Party, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
58
(e) Any Lender may, without the consent of any Credit Party, the
Administrative Agent or the Swingline Lender, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such Lender's
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) the Credit Parties, the Administrative Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to Section
10.2(b) that affects such Participant. Subject to paragraph (f) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.13, 2.14 and 2.15 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
(f) A Participant shall not be entitled to receive any greater
payment under Section 2.13 or 2.15 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.15 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.15(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any such pledge or assignment to a Federal Reserve
Bank, and this Section shall not apply to any such pledge or assignment of a
security interest; provided that no such pledge or assignment of a security
interest shall release a Lender from any of its obligations hereunder or
substitute any such assignee for such Lender as a party hereto.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (an
"SPC"), identified as such in writing from time to time by the Granting Lender
to the Administrative Agent and the Borrower, the option to provide to the
Borrower all or any part of any Loan that such Granting Lender would otherwise
be obligated to make to the Borrower pursuant to this Agreement; provided that
(i) nothing herein shall constitute a commitment by any SPC to make any Loan and
(ii) if an SPC elects not to exercise such option or otherwise fails to provide
all or any part of such Loan, the Granting Lender shall be obligated to make
such Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender. Each party hereto hereby agrees
that no SPC shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which shall remain with the Granting
Lender). In furtherance of the foregoing, each party hereto hereby agrees (which
agreement shall survive
59
the termination of this Agreement) that, prior to the date that is one year and
one day after the payment in full of all outstanding commercial paper or other
indebtedness of any SPC, it will not institute against, or join any other person
in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
state thereof. In addition, notwithstanding anything to the contrary in this
Section 10.4(h), any SPC may (A) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loans
to the Granting Lender, or with the prior written consent of the Borrower and
the Administrative Agent (which consent shall not be unreasonably withheld) to
any financial institutions providing liquidity and/or credit support to or for
the account of such SPC to support the funding or maintenance of Loans, and (B)
disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPC; provided that
non-public information with respect to the Borrower may be disclosed only with
the Borrower's consent which will not be unreasonably withheld. This paragraph
(h) may not be amended without the written consent of any SPC with Loans
outstanding at the time of such proposed amendment. An SPC shall not be entitled
to receive any greater payment under Section 2.13 or 2.15 than the applicable
Granting Lender would have been entitled to receive under such Sections if the
Granting Lender had made the relevant credit extension.
SECTION 10.5. Survival. All covenants, agreements, representations
and warranties made by the Credit Parties herein and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement
shall be considered to have been relied upon by the other parties hereto and
shall survive the execution and delivery of this Agreement and the making of any
Loans regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid and so long as the Commitments have not expired or terminated. The
provisions of Sections 2.13, 2.14, 2.15 and 10.3 and Article IX shall survive
and remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.
SECTION 10.6. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Section 4.1, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an
60
executed counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.
SECTION 10.7. Severability. Any provision of this Agreement held to
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 10.8. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, 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 and other indebtedness at any time owing by such Lender to or
for the credit or the account of either Credit Party against any of and all the
obligations of such Credit Party now or hereafter existing under this Agreement
held by such Lender, irrespective of whether or not such Lender shall have made
any demand under this Agreement and although such obligations may be unmatured.
The rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 10.9. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) Each Credit Party hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent
or any Lender may otherwise have to bring any action or proceeding relating to
this Agreement against any Credit Party or its properties in the courts of any
jurisdiction.
(c) Each Credit Party hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any court referred to
in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
61
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 10.1. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 10.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 10.11. Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 10.12. Confidentiality. Each of the Administrative Agent and
the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to any assignee of
or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section by it or (ii) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source
other than any Credit Party. For the purposes of this Section, "Information"
means all information received from any Credit Party relating to any Credit
Party or its business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by such Credit Party; provided that, in the case of information
received from any Credit Party after the date hereof, such information is
clearly identified at the time of delivery as confidential. Any Person required
to maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
62
SECTION 10.13. Interest Rate Limitation. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.
SECTION 10.14. Termination of Existing Agreement.
The Lenders that are parties to the Existing Agreement (and which
constitute "Required Lenders" under and as defined in the Existing Agreement)
hereby waive the three business days' notice requirement set forth in Section
2.7 of the Existing Agreement for terminating the commitments under the Existing
Agreement, and such Lenders and the Company agree that, subject to the Company's
payment of all amounts then payable under the Existing Agreement (whether or not
then due), the commitments under the Existing Agreement shall be terminated on
the Closing Date and replaced by the Commitments hereunder. After the
termination of such commitments, the Existing Agreement shall be of no further
force or effect (except for provisions thereof which by their terms survive
termination thereof).
▇▇▇▇▇▇▇ ▇▇.▇▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
Each Lender hereby notifies the Borrower that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the "Act"), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender to
identify the Borrower in accordance with the Act.
63
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
BLOCK FINANCIAL CORPORATION
By:________________________________
Title:
H&R BLOCK, INC.
By:________________________________
Title:
JPMORGAN CHASE BANK,
as Administrative Agent, as a
Lender and as Swingline Lender
By:________________________________
Title:
SCHEDULE 2.1
COMMITMENTS
Lender Commitment
------ ----------
JPMorgan Chase Bank $ 100,000,000
Bank of America, N.A. $ 100,000,000
Royal Bank of Scotland plc $ 100,000,000
Barclays Bank plc $ 75,000,000
HSBC Bank USA, National Association $ 75,000,000
Citibank, N.A. $ 62,500,000
Key Bank National Association $ 50,000,000
▇▇▇▇▇ Fargo Bank, N.A. $ 50,000,000
Calyon New York Branch $ 37,500,000
Mellon Bank, N.A. $ 37,500,000
Royal Bank of Canada $ 37,500,000
SunTrust Bank $ 37,500,000
U.S. Bank National Association $ 37,500,000
Wachovia Bank National Association $ 37,500,000
BNP Paribas $ 25,000,000
Comerica Bank $ 25,000,000
Deutsche Bank AG New York Branch $ 12,500,000
Fifth Third Bank $ 12,500,000
▇▇▇▇▇▇ Brothers Bank, FSB $ 12,500,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ Bank USA $ 10,000,000
Sumitomo Mitsui Banking Corporation $ 10,000,000
UBS Investment Bank $ 10,000,000
Bank Midwest, N.A. $ 5,000,000
▇▇▇▇▇ ▇▇▇ Commercial Bank, Ltd. $ 5,000,000
Commerce Bank, N.A. $ 5,000,000
E.Sun Commercial Bank, Ltd. (Los Angeles) $ 5,000,000
Malyan Banking Berhad $ 5,000,000
National City Bank $ 5,000,000
Norddeutsche Landesbank Girozentrale $ 5,000,000
PNC Bank, National Association $ 5,000,000
UMB Bank, n.a. $ 5,000,000
TOTAL $1,000,000,000
SCHEDULE 6.4(b)
ADDITIONAL BUSINESSES
- Businesses that offer products and services typically provided by finance
companies, banks and other financial service providers, including consumer
finance and mortgage-loan related products and services, credit products,
insurance products, check cashing, money orders, wire transfers, stored
value cards, ▇▇▇▇ payment services, notary services and similar products
and services.
- Businesses that offer financial, or financial-related, products and
services that can be marketed, provided or distributed by leveraging the
retail locations of Guarantor's Subsidiaries or the relationships of such
Subsidiaries with their clients as a tax return preparer or financial
advisor or service provider.
EXHIBIT A
FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the $1,000,000,000 364-Day Credit and Guarantee
Agreement, dated as of August 11, 2004 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Block Financial
Corporation (the "Borrower"), H&R Block, Inc., the Lenders party thereto and
JPMorgan Chase Bank, as administrative agent for the Lenders (in such capacity,
the "Agent"). Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.
The Assignor identified on Schedule l hereto (the "Assignor") and
the Assignee identified on Schedule l hereto (the "Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably purchases
and assumes from the Assignor without recourse to the Assignor, as of the
Effective Date (as defined below), the interest described in Schedule 1 hereto
(the "Assigned Interest") in and to the Assignor's rights and obligations under
the Credit Agreement with respect to those credit facilities contained in the
Credit Agreement as are set forth on Schedule 1 hereto (individually, an
"Assigned Facility"; collectively, the "Assigned Facilities"), in a principal
amount for each Assigned Facility as set forth on Schedule 1 hereto.
2. The Assignor (a) makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, or any other instrument or document furnished pursuant
thereto, other than that the Assignor has not created any adverse claim, lien or
encumbrance upon the interest being assigned by it hereunder and that such
interest is free and clear of any such adverse claim, lien or encumbrance; (b)
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of any Credit Party, any of their respective
Subsidiaries or any other obligor or the performance or observance by any Credit
Party, any of their Subsidiaries or any other obligor of any of their respective
obligations under the Credit Agreement or any other instrument or document
furnished pursuant hereto or thereto; and (c) attaches any promissory notes held
by it evidencing the Assigned Facilities and (i) requests that the Agent, upon
request by the Assignee, exchange the attached promissory notes for a new
promissory note or promissory notes payable to the Assignee and (ii) if the
Assignor has retained any interest in the Assigned Facility, requests that the
Agent exchange the attached promissory notes for a new promissory note or
promissory notes payable to the Assignor, in each case in amounts which reflect
the assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date).
3. The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received a copy of the Credit
Agreement, together with copies of the financial statements delivered pursuant
to Section 3.4 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (c) agrees that it will, independently and without
reliance upon the Assignor, the Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement or any other instrument or document furnished pursuant hereto or
thereto; (d) appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under the Credit Agreement
or any other instrument or document furnished pursuant hereto or thereto as are
delegated to the Agent by the terms thereof, together with such powers as are
incidental thereto; and (e) agrees that it will be bound by the provisions of
the Credit Agreement and will perform in accordance with its terms all the
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Lender including, if it is organized under the laws of a
jurisdiction outside the United States, its obligation pursuant to Section 2.14
of the Credit Agreement.
4. The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the "Effective
Date"). Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance by it and recording by the Agent pursuant
to the Credit Agreement, effective as of the Effective Date (which shall not,
unless otherwise agreed to by the Agent, be earlier than five Business Days
after the date of such acceptance and recording by the Agent).
5. Upon such acceptance and recording, from and after the Effective
Date, the Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other amounts) to the
Assignor for amounts which have accrued to the Effective Date and to the
Assignee for amounts which have accrued subsequent to the Effective Date. The
Assignor and the Assignee shall make all appropriate adjustments in payments by
the Agent for periods prior to the Effective Date or with respect to the making
of this assignment directly between themselves.
6. From and after the Effective Date, (a) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and shall be
bound by the provisions thereof and (b) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
7. This Assignment and Acceptance shall be governed by and construed
in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
and Acceptance to be executed as of the date first above written by their
respective duly authorized officers on Schedule 1 hereto.
Schedule 1
to Assignment and Acceptance
Name of Assignor:_______________________
Name of Assignee:_______________________
Effective Date of Assignment:_________________
Principal Commitment
Amount Assigned Percentage Assigned
--------------- -------------------
$_______ _________%
$_______ _________%
[NAME OF ASSIGNEE] [NAME OF ASSIGNOR]
By:___________________________________ By:________________________________
Title: Title:
Consented to and Accepted: [Consented To:
JPMORGAN CHASE BANK, as BLOCK FINANCIAL CORPORATION
Administrative Agent and as Swingline
Lender
By:___________________________________ By:________________________________
Title: Title:]
EXHIBIT B-1
[FORM OF OPINION OF MAYER, BROWN, ▇▇▇▇ & MAW LLP]
EXHIBIT B-2
[FORM OF OPINION OF ▇▇▇▇▇ ▇▇▇▇ LLP]
\
EXHIBIT C
[FORM OF EXTENSION REQUEST]
[Date]
JPMorgan Chase Bank, as Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ____________
Dear Sirs:
Reference is made to the $1,000,000,000 364-Day Credit and Guarantee
Agreement, dated as of August 11, 2004, among Block Financial Corporation, H&R
Block, Inc., the Lenders party thereto and JPMorgan Chase Bank, as
Administrative Agent (as the same may be amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein as therein defined.
This is an Extension Request pursuant to Section 2.18 of the Credit
Agreement requesting an extension of the Revolving Termination Date to [INSERT
REQUESTED REVOLVING TERMINATION DATE]. Please transmit a copy of this Extension
Request to each of the Lenders.
Very truly yours,
BLOCK FINANCIAL CORPORATION
By:________________________________
Title:
H&R BLOCK, INC.
By:________________________________
Title:
EXHIBIT D
FORM OF
NEW LENDER SUPPLEMENT
NEW LENDER SUPPLEMENT (this "New Lender Supplement"), dated ______,
200_, to the 364-Day Credit and Guarantee Agreement, dated as of August 11,
2004, as amended, supplemented or otherwise modified from time to time (the
"Credit Agreement"), among Block Financial Corporation, H&R Block, Inc., the
Lenders party thereto, the Syndication Agents named therein and JPMorgan Chase
Bank, as Administrative Agent.
W I T N E S S E T H:
WHEREAS, the Credit Agreement provides in Section 2.01(b) thereof
that any bank, financial institution or other entity may become a party to the
Credit Agreement with the consent of the Borrower and the Administrative Agent
(which consent shall not be unreasonably withheld) by executing and delivering
to the Borrower and the Administrative Agent a supplement to the Credit
Agreement in substantially the form of this New Lender Supplement; and
WHEREAS, the undersigned now desires to become a party to the Credit
Agreement;
NOW, THEREFORE, the undersigned hereby agrees as follows:
1. The undersigned agrees to be bound by the provisions of the
Credit Agreement, and agrees that it shall, on the date this New Lender
Supplement is accepted by the Borrower and the Administrative Agent, become a
Lender for all purposes of the Credit Agreement to the same extent as if
originally a party thereto, with an incremental Commitment of $__________.
2. The undersigned (a) represents and warrants that it is legally
authorized to enter into this New Lender Supplement; (b) confirms that it has
received a copy of the Credit Agreement, together with copies of the most recent
audited financial statements referred to in Section 3.4 thereof and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this New Lender Supplement; (c) agrees that
it has made and will, independently and without reliance upon the Administrative
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement, any other Loan Document
or any instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Credit Agreement,
any other Loan Document or any instrument or document furnished pursuant hereto
or thereto as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are incidental thereto; and (e) agrees that it will
be bound by the provisions of the Credit Agreement and will perform in
accordance with its terms all the obligations which by the terms of the Credit
Agreement are required to be performed by it as a Lender including, without
limitation, if it is
2
organized under the laws of a jurisdiction outside the United States, its
obligation pursuant to Section 2.15(e) of the Credit Agreement.
3. The address of the undersigned for notices for the purposes of
the Credit Agreement is as follows:
4. Terms defined in the Credit Agreement shall have their defined
meanings when used herein.
3
IN WITNESS WHEREOF, the undersigned has caused this New Lender
Supplement to be executed and delivered by a duly authorized officer on the date
first above written.
[INSERT NAME OF LENDER]
By_________________________________
Name:
Title:
Accepted this _____ day of
______________, 200_.
BLOCK FINANCIAL CORPORATION
By____________________________________
Name:
Title:
Accepted this ____ day of
______________, 200_.
JPMORGAN CHASE BANK,
as Administrative Agent
By____________________________________
Name:
Title:
EXHIBIT E
FORM OF INCREASED FACILITY ACTIVATION NOTICE
To: JPMORGAN CHASE BANK, as Administrative
Agent under the Credit Agreement referred to below
Reference is hereby made to the 364-Day Credit and Guarantee
Agreement, dated as of August 11, 2004 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Block Financial
Corporation (the "Borrower"), H&R Block, Inc., the Lenders party thereto, the
Syndication Agents named therein and JPMorgan Chase Bank, as Administrative
Agent. Terms defined in the Credit Agreement shall have their defined meanings
when used herein.
This notice is an Increased Facility Activation Notice referred to
in the Credit Agreement, and the Borrower and each of the Lenders party hereto
hereby notify you that:
1. Each Lender party hereto agrees to [make] [provide] an incremental
Commitment in the amount set forth opposite such Lender's name below
under the caption "Incremental Commitment Amount."
2. The Increased Facility Closing Date is ___________, 200__.
The Borrower certifies that no Default or Event of Default has
occurred and is continuing on the date of this notice.
2
IN WITNESS WHEREOF, the undersigned have executed this Increased
Facility Activation Notice this ___ day of ______________, 200__.
BLOCK FINANCIAL CORPORATION
By:________________________________
Name:
Title: Treasurer
Incremental Commitment Amount [NAME OF LENDER]
$
By:______________________________
Name:
Title:
CONSENTED TO:
JPMORGAN CHASE BANK,
as Administrative Agent
By:___________________________________
Name:
Title: