Exhibit 10.14
[CHICAGO MERCANTILE EXCHANGE LOGO]
CHICAGO MERCANTILE EXCHANGE INC. FIRST AMENDED
AND RESTATED CREDIT AGREEMENT
DATED AS OF OCTOBER 19, 2001
AMONG THE
CHICAGO MERCANTILE EXCHANGE INC.
AND
BANK OF AMERICA, N.A.
THE BANK OF NEW YORK
THE BANK OF TOKYO-MITSUBISHI, LTD
BANK ONE, ▇▇
▇▇▇▇▇ BROTHERS ▇▇▇▇▇▇▇▇ & CO.
THE CHASE MANHATTAN BANK
CITIBANK, ▇.▇.
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
HSBC BANK USA
THE NORTHERN TRUST COMPANY
SVENSKA HANDELSBANKEN AB (PUBL)
U.S. BANK NATIONAL ASSOCIATION
UBS, AG STAMFORD BRANCH
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS..............................................................................1
ARTICLE II THE CREDIT.............................................................................10
2.1 REVOLVING CREDIT LOANS................................................................10
2.2 RATABLE LOANS.........................................................................11
2.3 PAYMENT ON LAST DAY OF INTEREST PERIOD................................................11
2.4 REBORROWING OF ADVANCES...............................................................11
2.5 OPTIONAL PRINCIPAL PAYMENTS...........................................................11
2.6 MANDATORY PRINCIPAL PAYMENTS..........................................................11
2.7 ADJUSTMENTS OF COMMITMENTS............................................................11
2.8 COMMITMENT FEE........................................................................12
2.9 COLLATERAL............................................................................12
ARTICLE III FUNDING THE CREDITS...................................................................13
3.1 METHOD OF BORROWING...................................................................13
3.2 MINIMUM AMOUNT OF EACH ADVANCE........................................................14
3.3 RATE BEFORE AND AFTER MATURITY........................................................14
3.4 METHOD OF PAYMENT.....................................................................14
3.5 NOTES; TELEPHONIC NOTICES.............................................................14
3.6 INTEREST PAYMENT DATES; INTEREST BASIS................................................15
ARTICLE IV BANKS' SERVICING ARRANGEMENT...........................................................15
4.1 NOTICE TO AND PAYMENT BY THE BANKS....................................................15
4.2 PAYMENT BY BANKS TO SERVICING BANKS...................................................16
4.3 DISTRIBUTION OF PAYMENTS..............................................................16
4.4 RESCISSION OF PAYMENTS BY THE COMPANY.................................................17
4.5 POWERS GRANTED TO THE SERVICING BANKS.................................................17
4.6 RESIGNATION OR TERMINATION OF SERVICING BANK..........................................18
4.7 NON-RELIANCE REPRESENTATION...........................................................18
4.8 EXCULPATION...........................................................................18
ARTICLE V CONDITIONS PRECEDENT....................................................................19
5.1 CONDITIONS PRECEDENT..................................................................19
5.2 EACH ADVANCE..........................................................................20
5.3 RETURN OF EXISTING NOTES..............................................................21
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CHICAGO MERCANTILE EXCHANGE INC.
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
ARTICLE VI REPRESENTATIONS AND WARRANTIES.........................................................21
6.1 CORPORATE EXISTENCE AND STANDING......................................................21
6.2 AUTHORIZATION AND VALIDITY............................................................21
6.3 COMPLIANCE WITH LAWS AND CONTRACTS....................................................22
6.4 FINANCIAL STATEMENTS..................................................................22
6.5 MATERIAL ADVERSE CHANGE...............................................................22
6.6 SUBSIDIARIES..........................................................................23
6.7 ACCURACY OF INFORMATION...............................................................23
6.8 MARGIN REGULATIONS....................................................................23
6.9 TAXES.................................................................................23
6.10 LITIGATION............................................................................23
6.11 ERISA.................................................................................24
ARTICLE VII COVENANTS.............................................................................24
7.1 FINANCIAL REPORTING...................................................................24
7.2 USE OF PROCEEDS.......................................................................25
7.3 NOTICE OF DEFAULT.....................................................................25
7.4 CONDUCT OF BUSINESS...................................................................26
7.5 COMPLIANCE WITH LAWS..................................................................26
7.6 INSPECTION............................................................................26
7.7 TANGIBLE NET WORTH....................................................................26
7.8 LIENS.................................................................................26
7.9 ADDITIONAL CLEARING MEMBERS...........................................................27
7.10 CME RULE CHANGES......................................................................27
7.11 TAXES.................................................................................27
7.12 INSURANCE.............................................................................27
ARTICLE VIII DEFAULTS.............................................................................27
ARTICLE IX ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES.........................................29
9.1 ACCELERATION..........................................................................29
9.2 AMENDMENTS............................................................................30
9.3 PRESERVATION OF RIGHTS................................................................30
ARTICLE X COLLATERAL AGENT........................................................................31
10.1 DECLARATION AND ACCEPTANCE OF APPOINTMENT; NO FIDUCIARY DUTIES........................31
10.2 RELIANCE BY COLLATERAL AGENT..........................................................31
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CHICAGO MERCANTILE EXCHANGE INC.
FIRST AMENDED AND RESTATED CREDIT AGREEMENT
10.3 REIMBURSEMENT AND INDEMNIFICATION.....................................................32
10.4 COLLATERAL AGENT IN ITS INDIVIDUAL CAPACITY...........................................32
10.5 RESIGNATION OR TERMINATION OF COLLATERAL AGENT........................................32
10.6 NON-RELIANCE REPRESENTATION...........................................................33
10.7 EXCULPATION...........................................................................33
10.8 COLLATERAL VALUATION..................................................................34
ARTICLE XI GENERAL PROVISIONS.....................................................................34
11.1 SUCCESSORS AND ASSIGNS................................................................34
11.2 SURVIVAL OF REPRESENTATIONS...........................................................36
11.3 GOVERNMENTAL REGULATION...............................................................36
11.4 TAXES.................................................................................36
11.5 CHOICE OF LAW; JURISDICTION...........................................................40
11.6 HEADINGS..............................................................................40
11.7 ENTIRE AGREEMENT......................................................................41
11.8 SEVERAL OBLIGATIONS...................................................................41
11.9 EXPENSES; INDEMNIFICATION.............................................................41
11.10 ACCOUNTING.........................................................................43
11.11 SEVERABILITY OF PROVISIONS.........................................................43
11.12 PARENT HOLDING COMPANY.............................................................43
11.13 AMENDMENT AND RESTATEMENT..........................................................43
11.14 CONFIDENTIALITY....................................................................43
11.15 WAIVER OF TRIAL BY JURY............................................................44
ARTICLE XII SETOFF; RATABLE PAYMENTS..............................................................44
12.1 SETOFF; RATABLE PAYMENTS..............................................................44
ARTICLE XIII NOTICES..............................................................................45
13.1 GIVING NOTICE.........................................................................45
13.2 CHANGE OF ADDRESS.....................................................................46
ARTICLE XIV COUNTERPARTS..........................................................................46
ARTICLE XV SUBORDINATION..........................................................................46
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CHICAGO MERCANTILE EXCHANGE INC.
FIRST AMENDED AND RESTATED
CREDIT AGREEMENT
This First Amended and Restated
Credit Agreement, dated as of October
19, 2001 is among Chicago Mercantile Exchange Inc., a Delaware corporation
(together with its successors and assigns, "CME" or the "COMPANY"), the Banks
and The Bank of New York, as Collateral Agent.
RECITALS
The Company and the Banks entered into that certain
Credit Agreement,
dated as of November 1, 1992, (as heretofore amended, restated or otherwise
modified, the "EXISTING AGREEMENT").
The Company and the Banks now desire to amend and restate the Existing
Agreement in its entirety, subject to the terms and conditions hereof.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the Existing Agreement is hereby amended and
restated in its entirety to read as follows:
ARTICLE I
DEFINITIONS
The parties hereto agree as follows:
As used in this Agreement:
"ACCELERATED TERMINATION DATE" has the meaning set forth in SECTION
11.9(d).
"ACCELERATED TERMINATION NOTICE" has the meaning set forth in SECTION
2.7.2.
"ADDITIONAL AMOUNTS" has the meaning set forth in SECTION 11.4.
"ADVANCE" means a borrowing hereunder consisting of the aggregate
amount of the several Loans made to the Company by the Banks at the same time
and having the same maturity date.
"AGGREGATE COMMITMENT" means the aggregate of the Commitments of all
the Banks hereunder.
"AGREEMENT" means this First Amended and Restated
Credit Agreement, as
it may be amended, restated, supplemented or otherwise modified from time to
time.
"AGREEMENT ACCOUNTING PRINCIPLES" means generally accepted principles
of accounting in effect at the time of the preparation of the financial
statements referred to in SECTION 6.4, applied in a manner consistent with that
used in preparing such statements.
"ARTICLE" means an article of this Agreement unless another document
is specifically referenced.
"BANKS" means the banks and other financial institutions listed on the
signature pages of this Agreement and their respective successors and assigns.
"BORROWING BASE" means, at any time, the amount equal to the sum of:
(a) 99.25% of the aggregate market value at such time of all Security
Deposits in the form of United States Treasury Bills, plus
(b) 98% of the aggregate market value at such time of all Security
Deposits in the form of United States Treasury Notes with maturities of 2 years
or less, plus
(c) 97% of the aggregate market value at such time of all Security
Deposits that are United States Treasury Notes with maturities greater than 2
years and all Security Deposits in the form of United States Treasury Bonds,
plus
(d) 96% of the aggregate market value at such time of all Security
Deposits that are United States Agency obligations, plus
(e) 98% of the aggregate market value at such time of all Security
Deposits that are Money Fund Shares,
excluding, however, in each case, any Security Deposits that are not subject to
a first priority perfected Lien in favor of the Collateral Agent, for the
ratable benefit of the Banks, pursuant to the Collateral Documents, free and
clear of any other Lien other than Liens permitted by subsection (a), (b) or (c)
of SECTION 7.8. It is understood and agreed that the market value of all
Security Deposits as of any date shall be determined by the Collateral Agent in
accordance with its usual and customary practices.
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"BORROWING DATE" means a date on which an Advance is made hereunder.
"BUSINESS DAY" means a day on which banks are open for business in
Chicago and New York.
"CLEARING HOUSE" means the department of the Company through which all
futures and options on futures trades on or subject to the rules of the exchange
are reconciled, settled, adjusted and cleared.
"CLEARING MEMBER" means a firm qualified to clear trades through the
Clearing House.
"CME" has the meaning set forth in the preamble hereto.
"CME RULES" means the rules of the Company as amended and in effect
from time to time and includes any interpretations thereof. "CME RULE" shall
refer to any specifically designated rule.
"COLLATERAL" means any and all rights and interests in or to the
Security Deposits, in which a Lien is created or purported to be created
pursuant to the Collateral Documents, all as more particularly described in the
Security and Pledge Agreement.
"COLLATERAL AGENT" means The Bank of New York, in its capacity as
collateral agent for the Banks pursuant to Article X or any successor collateral
agent hereunder, together with their respective successors and assigns.
"COLLATERAL DOCUMENTS" means the Security and Pledge Agreement, the
Control Agreement and each document executed in connection therewith.
"COLLATERAL NOTICE" has the meaning set forth in SECTION 10.8.
"COMMITMENT" means, for each Bank, the obligation of such Bank to make
Loans to the Company in an aggregate amount not exceeding the amount set forth
opposite its signature below, as such amount may be modified from time to time
as provided herein.
"COMPANY" has the meaning set forth in the preamble hereto.
"CONSOLIDATED TANGIBLE NET WORTH" means at any date the consolidated
shareholders' equity of the Company and its consolidated Subsidiaries
3
determined in accordance with Agreement Accounting Principles, less their
consolidated Intangible Assets, all determined as of such date. For purposes of
this definition "Intangible Assets" means the amount (to the extent reflected in
determining such consolidated shareholders' equity) of (i) all write-ups (other
than write-ups resulting from foreign currency translations and write-ups of
assets of a going concern business made within twelve months after the
acquisition of such business) subsequent to December 31, 2000 in the book value
of any asset owned by the Company or a consolidated Subsidiary, (ii) all
investments in unconsolidated Subsidiaries and all equity investments in Persons
which are not Subsidiaries and (iii) all unamortized debt discount and expense,
unamortized deferred charges, goodwill, patents, trademarks, service marks,
trade names, copyrights, organization or developmental expenses and other
intangible items.
"CONTROL AGREEMENT" means that certain Securities Account Control
Agreement, dated as of October 19, 2001, by and among the Clearing Members party
thereto, the Company, The Bank of New York, as Securities Intermediary (as
defined therein) and the Collateral Agent, substantially in the form of EXHIBIT
H, as the same may be amended, restated, supplemented or otherwise modified from
time to time.
"CONTROLLED GROUP" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company, are treated as a single
employer under Section 414(b) or 414(c) of the Internal Revenue Code.
"DEFAULT" means an event described in Article VIII.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended FROM time to time.
"EXCLUDED TAXES" means, with respect to any and all payments to the
Collateral Agent, any Bank or any recipient of any payment to be made by or on
account of any obligation of the Company under the Loan Documents, net income
taxes, branch profits taxes, franchise and excise taxes (to the extent imposed
in lieu of net income taxes), and all interest, penalties and liabilities with
respect thereto, imposed on the Collateral Agent or any Bank.
"EXCESS AVAILABILITY" means, as of any date, the lesser of (a) the
excess, if any, of the Aggregate Commitment minus the aggregate principal of all
Loans outstanding and (b) the excess, if any, of the Borrowing Base minus the
aggregate principal of all Loans outstanding.
"FED FUNDS RATE" means for any period, a fluctuating interest rate per
annum for each day during such period equal to (a) the weighted average of the
4
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the preceding Business Day) by the
Federal Reserve Bank of New York in the Composite Closing Quotations for U.S.
Government Securities; or (b) if such rate is not so published for any day which
is a Business Day, the average of the quotations at approximately 10:30 a.m.
(Chicago time) for such day on such transactions received by the Collateral
Agent from three federal funds brokers of recognized standing selected by it.
"FOREIGN BANK" has the meaning set forth in SECTION 11.4.
"GFX(TM)" means that Wholly-Owned Subsidiary of the Company known as
the GFX(TM) Corporation.
"GFX(TM) GUARANTY" means certain Guaranties by the Company issued to
counterparties of GFX(TM) related to over-the-counter foreign exchange
transactions entered into by GFX(TM), or certain Guaranties by the Company
issued to a banking institution that has provided performance bond collateral,
or met performance bond or variation margin obligations on behalf of GFX(TM),
related to transactions in futures.
"GUARANTY" of a Person means any agreement by which such Person
assumes, guarantees, endorses, contingently agrees to purchase or provide funds
for the payment of, or otherwise becomes liable upon, the obligation of any
other Person, or agrees to maintain the net worth or working capital or other
financial condition of any other Person or otherwise assures any creditor of
such other Person against loss, including, without limitation, any comfort
letter, operating agreement or take-or-pay contract and shall include, without
limitation, the contingent liability of such Person in connection with any
application for a letter of credit.
"IEF(TM) GUARANTY" means the guaranty by the Company that a Clearing
Member participating in the IEF(TM) Program shall receive upon redemption one
($1) U.S. dollar for each IEF(TM) unit invested in the IEF(TM) Program. An
IEF(TM) unit (or fraction thereof) represents an equity interest in the CME
Interest Earning Facility for Customer-Segregated Funds, L.L.C. or the CME
Interest Earning Facility for Proprietary Funds, L.L.C. credited to a Clearing
Member for each $1.00 (or fraction thereof) invested by that Clearing Member.
"IEF(TM) PROGRAM" means a program in which performance bond cash
deposited with the CME's Clearing House by Clearing Members participating in the
IEF(TM) Program is pooled and invested in U.S. Government securities and under
repurchase and reverse repurchase agreements. The IEF(TM) Program consists of
two limited liability companies (CME Interest Earning Facility for
Customer-
5
Segregated Funds, L.L.C. and CME Interest Earning Facility for
Proprietary Funds, L.L.C.) of which the CME is the manager.
"INDEBTEDNESS" of a Person means such Person's (i) obligations for
borrowed money (other than a daylight overdraft incurred by the Company in the
course of effecting daily settlements with Clearing Members), (ii) obligations
representing the deferred purchase price of property other than accounts payable
arising in the ordinary course of such Person's business on terms customary in
the trade, (iii) obligations, whether or not assumed, secured by Liens or
payable out of the proceeds or production from property (other than futures and
options contracts held in a cross-margin account at the Company) now or
hereafter owned or acquired by such Person, (iv) obligations which are evidenced
by notes, acceptances, or other instruments, (v) capitalized lease obligations,
(vi) obligations for which such Person is obligated pursuant to a Guaranty
(other than the guarantee provided by the Clearing House to Clearing Members in
the ordinary course of business for their obligations to one another, or the
GFX(TM) and IEF(TM) Guaranties) and (vii) reimbursement obligations with respect
to letters of credit; PROVIDED, HOWEVER, that "Indebtedness" shall not include
(a) obligations of the Company to a Cross-Margining Clearing Organization (as
such term is defined in the CME Rules) arising out of the liquidation of one or
more pairs of cross-margin accounts held at the Clearing House and at such
Cross-Margining Clearing Organization and (b) obligations of the Company to a
pledgee arising out of the liquidation of one or more pairs of cross-margin
pledge accounts held at the Clearing House and at a Cross-Margining Clearing
Organization.
"INDEMNIFIED AMOUNTS" has the meaning set forth in SECTION 11.9(a).
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
"INDEMNIFIED PARTY" has the meaning set forth in SECTION 11.9(a).
"LIEN" of a Person means any security interest, mortgage, pledge,
lien, claim, charge, encumbrance, title retention agreement, lessor's
interest under a capitalized lease or analogous instrument, in, of or on any
property of such Person.
"LOAN" means, with respect to a Bank, such Bank's portion of any
Advance.
"LOAN DOCUMENTS" means this Agreement, the Notes and the Collateral
Documents.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the
Company's financial position or the Company's ability to perform its obligations
in the ordinary course of business as they become due.
6
"MEMBER ATTORNEY-IN-FACT" means CME in its capacity as attorney-in-
fact for the Clearing Members pursuant to the power of attorney authorized in
CME Rule 816.
"MONEY GRIDLOCK SITUATION" means (1) a disruption in the clearing and
settlement operations of the Clearing House due to temporary problems or delays
in obtaining or making settlement payments due to delays, overuse or other
similar problems with the Fed Wire or similar money transfer systems, (2) the
failure of a Cross-Margining Clearing Organization to approve one or more
withdrawals by the Clearing House from a cross-margining bank account held
either by the Company and such Cross-Margining Clearing Organization jointly, or
by a Clearing Member cross-margining its positions at the Clearing House with
its own or an affiliate's positions at such Cross-Margining Clearing
Organization, or (3) the failure of a Common Banking and Settlement Clearing
Organization (as such term is defined in the CME Rules) to approve one or more
withdrawals by the Clearing House from a common banking and settlement bank
account held either by the Company and such Common Banking and Settlement
Clearing Organization jointly or by a Clearing Member participating in common
banking and settlement with such Common Banking and Settlement Clearing
Organization.
"MONEY FUND SHARES" has the meaning set forth in the Security and
Pledge Agreement.
"MULTIEMPLOYER PLAN" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Company or any member
of the Controlled Group is a party to which more than one employer is obligated
to make contributions.
"NEW LENDING OFFICE" has the meaning set forth in SECTION 11.4.
"NON-TERMINATING BANK" has the meaning set forth in SECTION 2.7.2.
"NOTE" means a promissory note in substantially the form of EXHIBIT A
hereto, duly executed and delivered to each of the Banks by the Company and
payable to the order of each Bank in the amount of such Bank's Commitment,
including any amendment, modification, renewal or replacement of such promissory
note.
"OBLIGATIONS" means all unpaid principal of, and accrued and unpaid
interest on, the Notes, all accrued and unpaid commitment fees and all other
obligations of the Company to the Collateral Agent or any Bank arising under the
Loan Documents.
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"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 under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.
"PBGC" means the Pension Benefit Guaranty Corporation and its
successors and assigns.
"PERSON" means any corporation, natural person, firm, joint venture,
partnership, limited liability company, trust, unincorporated organization,
enterprise, government or any department or agency of any government.
"PLAN" means an employee pension benefit plan which is covered by
Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Internal Revenue Code as to which the Company or any Subsidiary may have
any liability.
"PRINCIPAL BANK" has the meaning set forth in SECTION 4.5.
"REGULATION U" means Regulation U of the Board of Governors of the
Federal Reserve System from time to time in effect and shall include any
successor or other regulation or official interpretation of said Board of
Governors relating to the extension of credit by banks for the purpose of
purchasing or carrying margin stocks applicable to member banks of the Federal
Reserve System.
"REPORTABLE EVENT" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such Section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event (provided that a failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code and of Section 302
of ERISA shall be a reportable event regardless of the issuance of any such
waivers in accordance with Section 412(d) of the Internal Revenue Code).
"REQUIRED BANKS" means the Banks holding at least 75% of the aggregate
unpaid principal amount of the outstanding Advance(s), or, if no Advance(s) are
outstanding, Banks having at least 75% of the Aggregate Commitment.
"REVOLVING CREDIT TERMINATION DATE" means, October 18, 2002 or any
earlier date on which the Aggregate Commitment is terminated pursuant to this
Agreement.
8
"SECTION" means a numbered section of this Agreement, unless another
document is specifically referenced.
"SECURITIES ACCOUNT" has the meaning set forth in the Security and
Pledge Agreement.
"SECURITY AND PLEDGE AGREEMENT" means that certain Security and Pledge
Agreement, dated as of October 19, 2001, by and among the Clearing Members party
thereto, the Company and the Collateral Agent, substantially in the form of
EXHIBIT I, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"SECURITY DEPOSITS" means the amount required to be deposited with the
Clearing House by each Clearing Member as security for its obligations to the
Clearing House pursuant to CME Rule 816.
"SERVICING BANK" means each Bank designated as a Servicing Bank in
accordance with SECTION 4.5.
"SINGLE EMPLOYER PLAN" means a Plan maintained by the Company or any
member of the Controlled Group for employees of the Company or any member of the
Controlled Group.
"SUBSIDIARY" means any corporation more than 50% of the outstanding
voting securities of which shall at the time be owned or controlled, directly or
indirectly, by the Company or by one or more Subsidiaries or by the Company and
one or more Subsidiaries, or any similar business organization which is so owned
or controlled.
"SURPLUS FUNDS" means funds in excess of those needed for normal
operations in the Clearing House Accounts and the General Accounts as referenced
in CME Rule 802.B.
"TAXES" means any and all present or future taxes, levies, imposts,
duties, fees, deductions, charges or withholdings imposed by any governmental
authority.
"TERMINATED COMMITMENT" has the meaning set forth in SECTION 2.7.2.
"2.7.2 EFFECTIVE DATE" has the meaning set forth in SECTION 2.7.2.
"2.7.2 NOTICE" has the meaning set forth in SECTION 2.7.2.
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"UNFUNDED LIABILITIES" means, (i) in the case of Single Employer
Plans, the amount (if any) by which the present value of all vested
nonforfeitable benefits under such Plan exceeds the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan, and (ii) in the case of Multiemployer
Plans, the withdrawal liability of the Company and Subsidiaries.
"UNMATURED DEFAULT" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"WHOLLY-OWNED SUBSIDIARY" means any Subsidiary all of the outstanding
voting securities of which shall at the time be owned or controlled, directly or
indirectly, by the Company or one or more Wholly-Owned Subsidiaries, or by the
Company and one or more Wholly-Owned Subsidiaries, or any similar business
organization which is so owned or controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE II
THE CREDIT
2.1 REVOLVING CREDIT LOANS. Through and including the Revolving
Credit Termination Date, each Bank severally agrees, on the terms and conditions
set forth in this Agreement and in its Note, to make Loans to the Company from
time to time in amounts not to exceed in the aggregate at any one time
outstanding the amount of its Commitment; provided, however, that if any
unmatured Advances are outstanding at the effective date of a change in any
Bank's Commitment pursuant to SECTION 2.7, each Bank instead severally agrees,
on the terms and conditions set forth in this Agreement, to make Loans from time
to time prior to the maturity of such unmatured Advances in amounts not to
exceed in the aggregate for all such Loans of such Bank the amount of such
Bank's ratable share (determined in proportion to its respective Commitment, as
so changed) of the excess of (i) the amount of the Aggregate Commitment, over
(ii) the aggregate principal outstanding amount of all such unmatured Advances
of the Banks (assuming for purposes of this clause (ii) that all other such
Banks' shares of such unmatured Advances were made and have not been
disproportionately prepaid); and provided, further that no Loan shall be made
if, after giving effect thereto, the aggregate outstanding principal of all
Loans would exceed the lesser of (A) the Aggregate Commitment or (B) the
Borrowing Base. Subject to the terms of this Agreement, the Company may borrow,
repay and reborrow at any time through the Revolving Credit
10
Termination Date. The obligations of any Bank to make Loans hereunder shall
cease at 4:01 p.m. (Chicago time) on the Revolving Credit Termination Date.
2.2 RATABLE LOANS. Each Advance hereunder shall consist of Loans
made from the several Banks, ratably in proportion to the amounts of their
respective Commitments on the date of such Advance.
2.3 PAYMENT ON LAST DAY OF INTEREST PERIOD. Each Advance and accrued
and unpaid interest thereon shall be due and payable 30 days after such Advance
is made.
2.4 REBORROWING OF ADVANCES. No Loans may be made hereunder to repay
Advances without the consent of all of the Banks.
2.5 OPTIONAL PRINCIPAL PAYMENTS. The Company may from time to time
prepay, without premium or penalty, all or a portion of any outstanding Advance,
pro rata among the Banks, in accordance with their respective shares of such
Advance by giving notice of such prepayment by 10:00 a.m. (Chicago time) on the
date of such payment to each Bank. Repayment of principal pursuant to this
SECTION 2.5 shall be applied to prepay the outstanding Loans, pro rata, and
shall be accompanied by accrued and unpaid interest thereon.
2.6 MANDATORY PRINCIPAL PAYMENTS. On any day on which the aggregate
outstanding principal of the Loans exceeds the Borrowing Base or the Aggregate
Commitment, such excess shall be immediately due and payable without the
necessity of any notice or demand. Repayment of such excess amounts shall be
applied to prepay the outstanding Loans, pro rata, and shall be accompanied by
accrued and unpaid interest thereon.
2.7 ADJUSTMENTS OF COMMITMENTS.
2.7.1 ADJUSTMENTS BY THE COMPANY. The Company may permanently reduce
the Aggregate Commitment, in whole or in part ratably among the Banks, in
proportion to the amounts of their respective Commitments in integral multiples
of $1,000,000, upon at least ten Business Days' written notice to the Banks,
which shall specify the amount of any such reduction; PROVIDED, HOWEVER, that,
subject to SECTIONS 2.7.2, 11.9(b) and 11.9(c), the amount of the Aggregate
Commitment may not be reduced below the outstanding principal amount of the
Advance(s), and provided further that a reduction by the Company of the
Aggregate Commitment to zero shall terminate this Agreement as of the effective
date of such reduction. All accrued and unpaid commitment fees shall be payable
on the effective date of such termination.
2.7.2 ADJUSTMENTS BY BANKS FOR ACCELERATED TERMINATION. If the
11
Commitment of a Bank hereunder is terminated pursuant to SECTION 11.9(b) or
11.9(c), the Company shall immediately notify each remaining Bank
("NON-TERMINATING BANK"), in writing of such termination ("ACCELERATED
TERMINATION NOTICE") and shall state the amount of such terminating Bank's
Commitment ("TERMINATED COMMITMENT") in the Accelerated Termination Notice. Each
Non-Terminating Bank shall notify the Company, in writing, on or before the 5th
Business Day after the date of the Accelerated Termination Notice, if and by
what amount such Bank is willing to increase its Commitment, which amount shall
be equal to all or some portion of the Terminated Commitment (each, a "2.7.2
NOTICE"). Any Non-Terminating Bank that fails to so notify the Company on or
before such 5th Business Day, shall be deemed to have declined to increase its
Commitment. If offers to increase Commitments are made by two or more
Non-Terminating Banks in an aggregate amount greater than the aggregate amount
of the Terminated Commitment, such Non-Terminating Banks and the Company hereby
agree that such offers shall be allocated as nearly as possible in proportion to
the aggregate amount of such offers, so that the aggregate amount thereof will
not exceed the amount of the Terminated Commitment. On or before the 6th
Business Day after the date of the Accelerated Termination Notice, the Company
shall notify each Non-Terminating Bank of the amount by which each such
Non-Terminating Bank's Commitment has been increased, which amount shall not
exceed the amount of such Non-Terminating Bank's offer to increase its
Commitment in such Bank's 2.7.2 Notice. All increases of Commitments by the
Banks, under this SECTION 2.7.2 shall become effective on the terminating Bank's
Accelerated Termination Date ("2.7.2 EFFECTIVE DATE"). The Company shall
promptly, and in no event later than the 2.7.2 Effective Date, deliver to each
Bank whose Commitment has been increased pursuant to this SECTION 2.7.2 a new
Note reflecting such Bank's new Commitment amount and each such Bank shall
promptly, after repayment of all Advances outstanding on the 2.7.2 Effective
Date, return to the Company the Company's superseded Note. On the 2.7.2
Effective Date, the Commitments shall be adjusted to reflect any such increases.
2.8 COMMITMENT FEE. From the date hereof to and including the
Revolving Credit Termination Date, the Company agrees to pay to each Bank a
commitment fee of 8/100 of 1% per annum (on the basis of a year consisting of
360 days) on the daily amount of such Bank's ratable share (determined in
proportion to its respective Commitment) of the excess of (i) the amount of the
Aggregate Commitment over (ii) the aggregate principal amount of all outstanding
Advances of the Banks, payable on the last day of each November, February, May
and August hereafter and on the Revolving Credit Termination Date, commencing on
the first of such dates to occur after the date hereof.
2.9 COLLATERAL.
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(a) All Obligations of the Company under this Agreement, the Notes
and all other Loan Documents shall be secured by the Collateral in accordance
with the Collateral Documents.
(b) So long as no Default shall have occurred and be continuing, the
Company may from time to time replace any security credited to the Securities
Account or any Money Fund Shares subject to the Lien of the Security and Pledge
Agreement with another security of a type described in CME Rule 816 that has a
market value equal to or greater than the market value of the replaced security,
determined as of the date of replacement by the Collateral Agent in accordance
with its usual and customary practices.
(c) So long as no Default shall have occurred and be continuing, the
Company may from time to time direct the Collateral Agent to (and the Collateral
Agent shall upon the request of the Company) liquidate any securities credited
to the Securities Account and any Money Fund Shares and apply the proceeds
thereof and any other amounts credited to the Securities Account to repay any
outstanding Loans, provided that after giving effect to such liquidation and the
repayment of such Loans, the aggregate principal amount of all remaining Loans
outstanding as of the date of such removal shall not exceed the Borrowing Base
as of the date of such removal.
(d) Upon any replacement or liquidation of Collateral pursuant to
subsection (b) or (c) above, the Lien of the Collateral Agent on the replaced or
liquidated Collateral, as applicable, shall be deemed released without further
consent of the Collateral Agent or any Bank.
ARTICLE III
FUNDING THE CREDITS
3.1 METHOD OF BORROWING. The Company shall give the Collateral Agent,
each Bank and each Servicing Bank notice not later than 3:15 p.m. (Chicago time)
on the Borrowing Date of each Advance, specifying the amount of such Advance,
each Bank's pro rata share thereof and the bank and the account to which the
proceeds are to be disbursed. Following such notice from the Company, the
Collateral Agent shall determine the aggregate value of the Collateral and the
Borrowing Base in accordance with the terms hereof and promptly, but in any
event, not later than 3:45 p.m. (Chicago time), provide each Bank with a
Collateral Notice. Subject to satisfaction of the applicable conditions
precedent set forth in Article V, not later than 4:45 p.m. (Chicago time) on
each Borrowing Date, each Bank
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severally shall make available to the Company, its pro rata share of the full
amount of each Advance in immediately available funds, at such Bank's address
specified pursuant to Article XIII. Further, if applicable, not later than 4:45
p.m. (Chicago time) on each Borrowing Date, each Servicing Bank shall make
available to the Company, on behalf of the Bank or Banks that it services, such
serviced Bank's or Banks' pro rata share of the full amount of each Advance in
immediately available funds, at such Servicing Bank's address specified pursuant
to Article XIII.
3.2 MINIMUM AMOUNT OF EACH ADVANCE. Each Advance shall be in the
minimum amount of $10,000,000 (and in integral multiples of $250,000 if in
excess thereof), PROVIDED, HOWEVER, that any Advance may be in the aggregate
amount of the Excess Availability.
3.3 RATE BEFORE AND AFTER MATURITY. Prior to maturity, Advances shall
bear interest at the Fed Funds Rate plus 45/100 of 1% per annum. Any Advance not
paid at maturity, whether by acceleration or otherwise, shall bear interest
until paid in full at a rate per annum equal to the Fed Funds Rate plus 2.4% per
annum. In the event that a change in the Fed Funds Rate is announced or
published at the time a Loan is outstanding, such change shall become effective
at the time it is announced or published.
3.4 METHOD OF PAYMENT. All payments (including prepayments) of
principal, interest, commitment fees and other amounts payable hereunder by the
Company shall be made in immediately available funds to the Banks (or, if
applicable, the related Servicing Banks) at the addresses specified pursuant to
Article XIII. All such payments shall be applied to principal, interest, fees,
expenses and other amounts due and payable hereunder in the following order:
FIRST, to amounts payable hereunder other than principal, interest and
commitment fees; SECOND, to commitment fees (in chronological order in
accordance with the dates such fees became due and payable); and THIRD, to
principal of, and interest on, the Advances (in chronological order in
accordance with the dates such Advances were made; and as to any single Advance,
first to interest thereon and second to principal thereof). Subject to the
provisions of SECTION 4.4, (a) all payments of principal of, and interest on,
the Advances shall be made to the Banks (or, if applicable, the related
Servicing Banks) ratably among the Banks, in proportion to the outstanding
principal amount of their respective Loans constituting part of such Advance and
(b) all payments of commitment fees and other amounts payable hereunder to the
Banks shall be made to the Banks (or, if applicable, the related Servicing Banks
on behalf of the applicable Banks, if applicable) ratably among the Banks, in
proportion to the amounts of their respective Commitments on the date such
payment is made.
3.5 NOTES; TELEPHONIC NOTICES. Each Bank shall maintain in accordance
with its usual and customary practices an account or accounts evidencing
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the Loans made by such Bank from time to time, including the amounts of
principal and interest payable and paid to such Bank from time to time under
this Agreement and the Notes; and each Bank is hereby authorized to record the
principal amount of each of its Loans and each repayment on the schedule
attached to its Note or in its books and records; PROVIDED, HOWEVER, that the
failure to so record shall not affect the Company's obligations under such Note.
The records kept by each Bank shall be presumed to be accurate and shall be
binding upon the Company absent manifest error. The Company hereby authorizes
the Banks and the Servicing Banks to extend Advances based on telephonic notices
made by any Persons any such Bank or Servicing Bank in good faith believes to be
acting on behalf of the Company. The Company agrees to deliver promptly to each
Bank and Servicing Bank a written confirmation of each telephonic notice signed
by an authorized signatory. If the written confirmation differs in any material
respect from the action taken by a Bank or Servicing Bank, as applicable, the
records of such Bank or Servicing Bank, as applicable, shall govern absent
manifest error.
3.6 INTEREST PAYMENT DATES; INTEREST BASIS. Interest accrued on each
Advance prior to maturity shall be payable to Banks (or, if applicable, the
related Servicing Banks) on the date on which the Advance is paid or prepaid,
whether due to acceleration or otherwise. Interest accrued on each Advance after
maturity shall be payable on demand. Interest and commitment fees shall be
calculated for actual days elapsed on the basis of a 360-day year. Interest
shall be payable for the day an Advance is made but not for the day of any
payment on the amount paid if payment is received prior to noon (local time at
the place of payment). If any payment of principal of, or interest on, an
Advance shall become due on a day which is not a Business Day, such payment
shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.
ARTICLE IV
BANKS' SERVICING ARRANGEMENT
4.1 NOTICE TO AND PAYMENT BY THE BANKS. Promptly after receiving
notice from the Company of each Advance requested pursuant to SECTION 3.1, the
Servicing Banks shall notify each of the applicable Banks by telephone (which
may, at the option of the Servicing Banks, be accompanied by facsimile
transmission), of each Advance, which notice shall state: (a) the dollar amount
of such Advance; (b) each Bank's ratable share of such Advance; (c) the date and
time when such Advance is to be made; and (d) the Servicing Bank to which the
Bank's ratable share of such Advance shall be sent. Except as hereinafter
provided, promptly after receipt of such notice from the Servicing Banks and, in
any event, before the time specified in such
15
notice as the time when such Advance is to be made to the Company, each
applicable Bank shall transfer its ratable share of such Advance to the
appropriate Servicing Bank by Federal Reserve wire transfer or, in the event of
a failure of the Federal Reserve wire transfer system, in other immediately
available funds.
4.2 PAYMENT BY BANKS TO SERVICING BANKS. If a Servicing Bank fails to
receive a transfer from any of the applicable Banks by the time required
pursuant to SECTION 4.1, such Servicing Bank shall advance such amount for and
on behalf of such Bank, provided that, notwithstanding the foregoing, such Bank
shall, in any event, transfer to the Servicing Bank, by the means set forth in
SECTION 4.1, its ratable share of the relevant Advance not later than 10:00 a.m.
(Chicago time) the next Business Day after the Servicing Bank provides such Bank
with the notice specified in SECTION 4.1. In the event a Servicing Bank advances
funds overnight to the Company pursuant to the immediately preceding sentence,
the Bank on whose behalf such funds are advanced shall reimburse the Servicing
Bank for the Servicing Bank's cost of overnight funds, for the period from the
time the Servicing Bank advances such funds to the Company for and on behalf of
such Bank to the time of the Servicing Bank's receipt of such Bank's transfer of
its ratable share of the relevant Advance. Such Servicing Bank shall promptly
provide such Bank with notice of the amount of its cost of overnight funds for
such period and such amount shall thereupon become immediately due and payable
from such Bank to such Servicing Bank, and shall be paid by such Bank to such
Servicing Bank upon receipt of such notice without further notice from or demand
by such Servicing Bank.
4.3 DISTRIBUTION OF PAYMENTS. Whenever a Servicing Bank receives from,
or on behalf of the Company, or any other person or party, a payment of
principal, interest or commitment fees in connection with the Loans with respect
to any of which the applicable Banks are entitled to receive a share, such
Servicing Bank shall promptly pay to such Banks, in lawful money of the United
States of America and in the kind of funds so received by such Servicing Bank,
the amount due each of such Banks as determined pursuant to this Agreement;
PROVIDED, HOWEVER, that the amount of such distribution shall be adjusted to the
extent that amounts are owed by any Bank to such Servicing Bank pursuant to
SECTION 4.2. or are required to be returned to such Servicing Bank pursuant to
SECTION 4.4. If any payment of principal, interest or commitment fees is
received from or on behalf of the Company by a Servicing Bank before 10:00 a.m.
(Chicago time) on any Business Day, that Servicing Bank shall use reasonable
efforts to wire transfer the appropriate portion of the same to the applicable
Banks that same Business Day, but in any event shall wire the same to each of
such Banks before the end of the next Business Day. In the event that a
Servicing Bank receives any such payment from or on behalf of the Company before
10:00 a.m. (Chicago time) on any Business Day and does not transfer to one or
more of the applicable Banks the appropriate portion of such payment on that
day, the Company shall, promptly upon receipt of notice from any
16
such Bank, pay directly to such Bank an amount equal to the interest on such
portion, at the Fed Funds Rate or, with respect to any payment of principal on a
Loan, at the rate set forth in SECTION 3.3, for the period commencing on the day
such Servicing Bank receives such payment up to but not including the following
Business Day.
4.4 RESCISSION OF PAYMENTS BY THE COMPANY. If all or part of any
payment made by the Company to a Servicing Bank of principal, interest or
commitment fees in connection with the Loans is rescinded or must otherwise be
returned for any reason and if a Servicing Bank has paid to any of the Banks
such Bank's ratable share therein, such Bank shall, upon telephone notice from
such Servicing Bank, forthwith pay to such Servicing Bank, on the date of such
telephone notice (if notice is received by such Servicing Bank at or prior to
10:00 a.m. Chicago time) or on the next Business Day (if notice is received by
such Servicing Bank after 10:00 a.m. Chicago time), an amount equal to such
Bank's ratable interest in the amount that was rescinded or that must be so
returned by the Servicing Bank. A Servicing Bank shall promptly return to the
Company each such amount (or any lesser amount) that is received from each Bank.
A Servicing Bank shall have no obligation to the Company for any amount that the
Servicing Bank paid to any Bank and that is not repaid by such Bank, provided
that the Servicing Bank did in fact provide such Bank with the notice described
above to the effect that such payment was rescinded or must be returned.
4.5 POWERS GRANTED TO THE SERVICING BANKS. The Company and one or
more Banks (each a "PRINCIPAL BANK") may, upon mutual agreement, from time to
time request another Bank to act as a Servicing Bank for the purpose of
administering and servicing the Loans of the Principal Banks. Upon the
acceptance of the offer to service by the proposed Servicing Bank (which shall
be in the sole discretion of such Bank), such Servicing Bank as administrator of
the Loans of the Principal Banks for which it acts (and not as an agent,
employee or fiduciary), shall be entitled to exercise all such powers as are
incidental to the powers to receive and collect funds from the Principal Banks
and the Company provided for in this Agreement, and to take such other actions
with respect to such Loans as are provided hereby or as may be from time to time
agreed by such Servicing Bank and the Principal Banks. In acting under this
Agreement, each Servicing Bank agrees to exercise the same degree of care in
administering such Loans as it would use in managing its own loans; PROVIDED,
HOWEVER, that this sentence shall not make any Servicing Bank a fiduciary to any
Principal Bank. The Principal Banks and the Company hereby agree and acknowledge
that (i) in performing the duties provided for in this Agreement, the Servicing
Banks are acting solely for the benefit of the Principal Banks and are in no way
to be construed to be acting as agent for the Company; and (ii) the servicing
arrangement provided for herein is not intended to constitute, and shall not be
construed to establish, a partnership or joint venture
17
between the Servicing Banks and the Principal Banks, or between the Servicing
Banks and the Company.
4.6 RESIGNATION OR TERMINATION OF SERVICING BANK. A Servicing Bank
may resign its position as such at any time upon thirty (30) day's prior notice
to the Company and the Principal Banks for which it acts, and the Company and
the applicable Principal Banks acting together may terminate a Servicing Bank's
role as such at any time upon thirty (30) day's prior notice to such Servicing
Bank. Subsequent to the effective date of such resignation or termination, the
resigned or terminated (as applicable) Servicing Bank shall have no further
obligations in that capacity under this Agreement, and unless and until a
successor servicing bank is appointed by the Company and the applicable
Principal Banks acting together, (i) the services performed by such Servicing
Bank hereunder shall be performed by the individual Principal Banks, and the
Company, each on its own behalf, and (ii) any payments or communications made by
the Company to such Servicing Bank hereunder shall be made directly to the
applicable individual Principal Banks.
4.7 NON-RELIANCE REPRESENTATION. Each of the Banks acknowledges and
represents that it has, independently of and without reliance upon the Servicing
Banks, and based solely upon its own expertise (and the expertise of its agents
and independent advisors) and upon financial statements and other information
deemed appropriate by it, made its own credit analysis of the Company and made
its own decision to enter into this Agreement. Each of the Banks further
acknowledges and represents that it will, independently of and without reliance
upon the Servicing Banks, and based solely upon its own expertise (and the
expertise of its agents and independent advisors, if any) and upon such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis of the Company and its own decisions with respect
to this Agreement.
4.8 EXCULPATION. No Servicing Bank nor any of its shareholders,
directors, officers, employees or agents shall be liable to the Banks, or any of
them individually, for any obligation, undertaking, act or judgment of the
Company or any other Person, or for any error of judgment or any action taken or
omitted to be taken by such Servicing Banks or any other Servicing Bank (except
and to the extent that the same arises from gross negligence or willful
misconduct on the part of such Servicing Bank), or be bound to ascertain or
inquire as to the performance or observance of any term of any of the Loan
Documents. Without limiting the generality of the foregoing, the Servicing
Banks: (a) may consult with legal counsel selected by the Servicing Banks and
shall not be liable for any action taken or omitted to be taken in good faith by
the Servicing Banks in accordance with the advice of such counsel; (b) makes no
warranty or representation and shall not be responsible for any warranty or
representation made in or in connection with any of the Loan Documents, or for
the financial condition of the Company or any other
18
Person, or for the observance or performance of any obligations of the Company
or any other Person, or for the truth or accuracy of any document provided to
the Banks that the Servicing Banks have initially received from, or that the
Servicing Banks have prepared based upon information received from, the Company
or any other Person; (c) make no warranty or representation and shall not be
responsible for the due execution, validity, enforceability, sufficiency or
collectibility of any of the Loan Documents; (d) shall incur no liability under
or in respect of any such agreement or document by acting upon any notice (by
telephone or otherwise), or writing (including telex and telegraphic
communication) believed by the Servicing Banks in good faith to be genuine and
to be signed or sent by the proper party or Person; and (e) make no warranty or
guarantee as to: (i) future payments by the Company or any other obligor or
guarantor of the Loans, (ii) the Company's future compliance with or performance
of any of the terms and conditions contained in the Loan Documents, or (iii) the
collectibility of the Loans.
ARTICLE V
CONDITIONS PRECEDENT
5.1 CONDITIONS PRECEDENT.
(a) CONDITIONS TO CLOSING. This Agreement shall become effective as of
the date hereof upon the execution and delivery of a counterpart hereto by each
party hereto.
(b) CONDITIONS TO INITIAL ADVANCE. The Banks shall not be required to
make the initial Advance hereunder unless the Company has furnished to each such
Bank:
(i) A certificate of good standing with respect to the Company,
certified by the Secretary of State of Delaware.
(ii) A copy, certified by the Secretary or Assistant Secretary
of the Company, of CME's Board of Directors' resolutions (and resolutions
of other bodies, if any are deemed necessary by counsel for any Bank)
authorizing the execution of the Loan Documents.
(iii) An incumbency certificate, in substantially the form of
EXHIBIT G hereto, executed by the Secretary or Assistant Secretary of the
Company, which shall identify by name
19
and title and bear the signature of the officers of the Company authorized
to sign the Loan Documents and to make borrowings hereunder, including
telephonic borrowings, upon which certificate the Banks shall be entitled
to rely until informed of any change in writing by the Company.
(iv) A certificate, signed by the president & CEO, managing
director & president of the Clearing House division, managing director and
chief administrative officer, or managing director & chief financial
officer of the Company or his delegate, in substantially the form of
EXHIBIT B hereto. Such certificate may be furnished by the Company by any
means set forth in SECTION 13.1 hereof, and shall be deemed given to such
Bank as provided therein.
(v) A written opinion of the Company's counsel, addressed to
the Banks, covering the matters set forth in EXHIBIT C hereto.
(vi) A Note, duly executed and delivered by the Company and
payable to the order of such Bank.
(vii) A copy of the Security and Pledge Agreement, duly executed
and delivered by the Company, for itself and as Member Attorney-in-Fact on
behalf of each grantor named therein.
(viii) A copy of the Control Agreement, duly executed and
delivered by the Company, for itself and as Member Attorney-in-Fact on
behalf of each grantor named therein, The Bank of New York, as Securities
Intermediary and the Collateral Agent.
5.2 EACH ADVANCE. No Bank shall be required to make any Advance
(including the initial Advance), unless on the applicable Borrowing Date:
(a) There exists no Default or Unmatured Default.
(b) The representations and warranties contained in Article VI are
true and correct in all material respects as of such Borrowing Date except for
changes in the Schedules hereto reflecting transactions permitted by this
Agreement.
(c) The Company has furnished to such Bank a certificate which sets
forth in reasonable detail the intended use of the proceeds of such Advance
20
(which shall comply with SECTION 7.2 hereof) and confirms that such proceeds
will not be used to repay maturing Advances except as permitted pursuant to
SECTION 2.4 hereof, in substantially the form of EXHIBIT D hereto. Such
certificate may be furnished by Company by any means set forth in SECTION 13.1
hereof, and shall be deemed delivered to such Bank as provided therein.
(d) The Collateral Agent has furnished to such Bank a Collateral
Notice in accordance with SECTION 3.1 indicating the aggregate market value of
the Collateral on such date.
(e) The aggregate outstanding principal of all Loans, after giving
effect to the Loans to be made on such Borrowing Date, does not exceed the
lesser of (i) the Aggregate Commitment and (ii) the Borrowing Base as of such
date.
Each request by the Company for a Loan hereunder shall constitute a
representation and warranty by the Company that the conditions contained in
SECTIONS 5.2(a) and (b) have been satisfied.
5.3 RETURN OF EXISTING NOTES. Upon its receipt of a Note issued
pursuant to this Agreement, each Bank holding a promissory note of the Company
issued pursuant to the Existing Agreement, shall return the original of each
such promissory note to the Company, marked "Cancelled."
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Banks, as of the date of
each Advance, that:
6.1 CORPORATE EXISTENCE AND STANDING. Each of the Company and the
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted and where the failure to have such authority would
reasonably be expected to have a Material Adverse Effect.
6.2 AUTHORIZATION AND VALIDITY.
(a) The Company has the corporate power and authority and legal
right to execute and deliver the Loan Documents and to perform its obligations
thereunder. The execution and delivery by the Company of the Loan
21
Documents and the performance of its obligations thereunder have been duly
authorized by proper corporate proceedings. The Company has duly executed and
delivered the Loan Documents, and the Loan Documents constitute legal, valid and
binding obligations of the Company enforceable against the Company in accordance
with their terms, except as enforceability may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and by general principles of equity (whether enforcement is considered
in a proceeding at law or in equity).
(b) The Company has the authority pursuant to CME Rule 816 to
execute and deliver, as Member Attorney-in-Fact on behalf of the applicable
Clearing Members, the Collateral Documents and to cause the Security Deposits to
be subject to the Lien of the Collateral Documents to secure the Obligations.
CME Rules 816 and 913.B have been duly adopted and are in full force and effect.
6.3 COMPLIANCE WITH LAWS AND CONTRACTS. Neither the execution and
delivery by the Company of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on the Company or any Subsidiary or the Company's or any
Subsidiary's articles of incorporation or by-laws or the provisions of any
material indenture, instrument or agreement to which the Company or any
Subsidiary is a party or is subject, or by which it, or its property, is bound,
or conflict with or constitute a default thereunder. No order, consent,
approval, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental or public body or
authority, or any subdivision thereof, that has not been obtained is required to
authorize, or is required in connection with the execution, delivery and
performance of, or the legality, validity, binding effect or enforceability of,
any of the Loan Documents.
6.4 FINANCIAL STATEMENTS. The most recent annual, audited consolidated
financial statements of the Company and the Subsidiaries heretofore delivered to
the Banks were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Company and
the Subsidiaries at such date and the consolidated results of their operations
for the period then ended.
6.5 MATERIAL ADVERSE CHANGE. No material adverse change in the
business, financial condition, or results of operations of the Company and the
Subsidiaries has occurred since the date of the financial statements referred to
in SECTION 6.4; PROVIDED, HOWEVER, that in the event the Company utilizes its
own funds
22
to repay all or any portion of an Advance, and such repayment results in such a
material adverse change, then such material adverse change shall not be deemed
to have occurred until the thirty-first consecutive day that such material
adverse change continues.
6.6 SUBSIDIARIES. SCHEDULE I contains an accurate list of all of the
presently existing Subsidiaries of the Company, setting forth their respective
jurisdictions of incorporation and the percentage of their respective capital
stock owned by the Company or other Subsidiaries. All of the issued and
outstanding shares of capital stock of such Subsidiaries have been duly
authorized and issued and are fully paid and non-assessable.
6.7 ACCURACY OF INFORMATION. No written information, exhibit or report
furnished by the Company or any Subsidiary to any Bank in connection with the
negotiation of the Loan Documents contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statements
contained therein not materially misleading in light of the circumstances
existing at the time furnished.
6.8 MARGIN REGULATIONS. Margin stock (as defined in Regulation U)
constitutes less than 25% of those assets of the Company and its Subsidiaries
which are subject to any limitation on sale, pledge, or other restriction
hereunder. No proceeds of any Loans will be used to "purchase" or "carry" any
"margin stock" (each as defined in Regulation U), or for any purpose that
violates the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System as now and from time to time hereafter in effect.
6.9 TAXES. The Company and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed by any of them and have paid all taxes due pursuant to said returns or
pursuant to any assessment received by the Company or any such Subsidiary,
except such taxes, if any, as are being contested in good faith. To the best of
the Company's knowledge, no tax liens have been filed and no claims are being
asserted with respect to any such taxes other than those taxes that are being
contested in good faith. The charges, accruals and reserves on the books of the
Company and its Subsidiaries in respect of any taxes or other governmental
charges are adequate.
6.10 LITIGATION. Except as set forth in SCHEDULE II attached hereto,
there is no litigation or proceeding pending or, to the knowledge of any of
their officers, threatened against or affecting the Company or any Subsidiary of
the Company which might materially adversely affect the business, financial
condition or results of operations of the Company or the ability of the Company
to perform its obligations under the Loan Documents.
23
6.11 ERISA. No Plan has Unfunded Liabilities in excess of $1,000,000.
Each Plan complies in all material respects with all applicable requirements of
law and regulations, no Reportable Event has occurred with respect to any Plan,
neither the Company nor any of its Subsidiaries has withdrawn from any Plan or
initiated steps to do so, and no steps have been taken to terminate any Plan.
ARTICLE VII
COVENANTS
During the term of this Agreement and thereafter as long as any
Advances remain outstanding hereunder, unless the Required Banks shall otherwise
consent in writing:
7.1 FINANCIAL REPORTING. The Company will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with generally accepted accounting principles, and furnish to the
Banks:
(a) Within 120 days after the close of each of its fiscal years, an
unqualified audit report certified by independent certified public accountants,
acceptable to the Required Banks, prepared in accordance with Agreement
Accounting Principles on a consolidated basis for itself and the Subsidiaries,
including balance sheets as of the end of such period, and statements of income,
changes in shareholders' equity and a statement of cash flows for the year then
ended, accompanied by any management letter prepared by said accountants and by
a certificate of said accountants in substantially the form of EXHIBIT E hereto,
or if, in the opinion of such accountants, such certificate is not applicable, a
description of any Default or Unmatured Default relating to accounting matters
that in their opinion exists, stating the nature and status thereof.
(b) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and the Subsidiaries, an
unaudited consolidated balance sheet as at the close of each such period and
unaudited consolidated statements of income, changes in shareholder's equity and
cash flows from the beginning of such fiscal year to the end of such quarter,
each prepared in a manner consistent with the preparation of the Company's
year-end statements and in accordance with Agreement Accounting Principles.
(c) Within 45 days after the close of each quarterly period, a
report of (i) current Surplus Funds and (ii) the aggregate amount of Security
Deposits being held by the Company including a breakdown of the manner in which
Security
24
Deposits are held (cash, money market mutual funds or treasury securities) and
the location thereof.
(d) Within the time periods set forth herein for the furnishing of
the financial statements required hereunder, a certificate signed by its
managing director & chief financial officer or another managing director (i) in
substantially the form of EXHIBIT F hereto, or (ii) if any Default or Unmatured
Default exists, showing the calculations set forth in EXHIBIT F as well as a
description of the nature and status of such Default or Unmatured Default.
(e) Within 120 days after the close of each fiscal year, a statement
of the Unfunded Liabilities of each Plan, signed by the managing director &
chief financial officer of the Company or another managing director, or, in the
event there are no Unfunded Liabilities, a certificate signed by its managing
director & chief financial officer or another managing director to that effect.
(f) As soon as possible and in any event within 10 days after the
Company knows that any Reportable Event has occurred with respect to any Plan, a
statement, signed by the managing director & chief financial officer of the
Company or another managing director, describing said Reportable Event and the
action which the Company proposes to take with respect thereto.
(g) Such other information (including non-financial information) as
any Bank may from time to time reasonably request.
7.2 USE OF PROCEEDS. The Company will only use the proceeds of the
Advances to provide temporary liquidity in circumstances where CME is entitled
to use the Security Deposits of its Clearing Members as provided in the CME
Rules and in circumstances where a Money Gridlock Situation exists.
Additionally, the Company may use the proceeds of the Advances to fulfill its
obligations under the GFX(TM) Guaranty, PROVIDED, HOWEVER, that the Company may
use the proceeds for such purposes only up to the amount of Surplus Funds on any
given day. The Company will not, nor will it permit any Subsidiary to, use any
of the proceeds of the Loans to "purchase" or "carry" any "margin stock" (each
as defined in Regulation U) or for any purpose that violates the provisions of
Regulation T, U or X of the Board of the Federal Reserve System as now and from
time to time hereafter in effect.
7.3 NOTICE OF DEFAULT. The Company will, and will cause each
Subsidiary to, give prompt notice in writing to the Banks of the occurrence of
any Default or Unmatured Default and of any other development, financial or
otherwise, which would reasonably be expected to materially adversely affect its
business, properties or affairs or the ability of the Company to repay the
Obligations.
25
7.4 CONDUCT OF BUSINESS. The Company will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and to do all things necessary to remain duly incorporated, validly
existing and in good standing as a domestic corporation in its jurisdiction of
incorporation and maintain all requisite authority to conduct its business in
each jurisdiction in which its business is conducted and where the failure to
have such authority would reasonably be expected to have a Material Adverse
Effect.
7.5 COMPLIANCE WITH LAWS. The Company will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except
where the failure to so comply would not reasonably be expected to have a
Material Adverse Effect.
7.6 INSPECTION. The Company will, and will cause each Subsidiary to,
permit the Collateral Agent or its representatives and agents, to inspect any of
the properties, corporate books and financial records of the Company and each
Subsidiary, to examine and make copies of the books of accounts and other
financial records of the Company and each Subsidiary, and to discuss the
affairs, finances and accounts of the Company and each Subsidiary (the foregoing
activities, an "AUDIT") with, and to be advised as to the same by, their
respective officers at such reasonable times and intervals as the Collateral
Agent may designate; provided that so long as no Default has occurred and is
continuing the Company shall only be responsible for the costs and expenses of
one Audit per 12-month period.
7.7 TANGIBLE NET WORTH. The Company will maintain at all times a
Consolidated Tangible Net Worth of not less than $90,000,000.
7.8 LIENS. The Company will not, nor will it permit any Subsidiary to,
create or incur any Lien in, of or on the Collateral, except:
(a) Liens in favor of the Collateral Agent.
(b) Liens in favor of the Company, which Liens are subordinated to
the Liens in favor of the Collateral Agent in accordance with ARTICLE XV hereof.
(c) Liens arising out of repurchase agreements or reverse repurchase
agreements entered into by the Company or any Subsidiary thereof.
(d) Liens arising out of judgments or awards against the Company or
any Subsidiary, in an amount of not more than $5,000,000 in the aggregate, which
judgment or award is vacated, discharged, satisfied or stayed or bonded pending
appeal within 60 days from the entry thereof.
26
7.9 ADDITIONAL CLEARING MEMBERS. Promptly upon any Person becoming a
Clearing Member of CME, the Company will execute and deliver, as Member
Attorney-in-Fact, a supplement to the Security and Pledge Agreement,
substantially in the form of Exhibit A thereto, joining such Clearing Member as
a party to the Security and Pledge Agreement and a supplement to the Control
Agreement, substantially in the form of Exhibit B thereto, joining such Clearing
Member as a party to the Control Agreement.
7.10 CME RULE CHANGES. The Company will not, without the prior written
consent of the Banks, amend, revoke, or rescind any CME Rule in any manner that
would have a materially adverse effect on the Lien granted to the Collateral
Agent in the Collateral or the ability of the Collateral Agent to enforce any of
its rights under the Collateral Documents.
7.11 TAXES. The Company will, and will cause each Subsidiary to, pay
when due all taxes, assessments and governmental charges and levies upon it or
its income, profits or property, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside.
7.12 INSURANCE. The Company will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their property in such amounts and covering such risks as is consistent with
sound business practice in the industry, and the Company will furnish to any
Bank upon request full information as to the insurance carried.
ARTICLE VIII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
8.1 Any representation or warranty made or deemed made by or on
behalf of the Company or any Subsidiary to the Banks under or in connection
with this Agreement, any Loan, or any certificate or written information
delivered in connection with this Agreement or any other Loan Document shall
be materially false as of the date on which made or deemed to have been made.
8.2 Nonpayment of principal of any Note when due, nonpayment of
interest upon any Note within five days after the same becomes due or
nonpayment of any commitment fee or other obligation under any of the Loan
Documents within 10 days after the same becomes due.
8.3 (i) Any breach by the Company of any of the terms required to be
observed by it under Section 7.1, which continues unremedied for 10 days after
the Company receives notice of such breach from any Bank; (ii) any breach by the
27
Company of any of the terms required to be observed by it under SECTION 7.2,
7.7, 7.8 or 7.10; or (iii) any material breach by the Company of any of the
other terms or provisions required to be observed by it under Article VII.
8.4 The breach by the Company (other than a breach which constitutes a
Default under SECTION 8.1, 8.2 or 8.3) of any of the terms or provisions of this
Agreement which is not remedied within five days after written notice from any
Bank.
8.5 Failure of the Company or any Subsidiary to pay any Indebtedness
in an aggregate amount in excess of $5,000,000 when due; or the default by the
Company or any Subsidiary in the performance of any term, provision or condition
contained in any agreement under which any such Indebtedness was created or is
governed, which results in such Indebtedness being accelerated or declared to be
due and payable or required to be prepaid (other than by a regularly scheduled
payment) prior to its stated maturity.
8.6 The Company or any Subsidiary shall (a) have an order for relief
entered with respect to it under the Federal Bankruptcy Code, (b) not pay, or
admit in writing its inability to pay, its debts generally as they become due,
(c) make an assignment for the benefit of creditors, (d) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any substantial part of its
property, (e) institute any proceeding seeking an order for relief under the
Federal Bankruptcy Code or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it, (f) take any corporate action to authorize or effect any of
the foregoing actions set forth in this SECTION 8.6 or (g) fail to contest in
good faith any appointment or proceeding described in SECTION 8.7.
8.7 Without the application, approval or consent of the Company or any
Subsidiary, a receiver, trustee, examiner, liquidator or similar official shall
be appointed for the Company or any Subsidiary or any substantial part of its
property, or a proceeding described in SECTION 8.6(e) shall be instituted
against the Company or any Subsidiary and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for a period
of 45 consecutive days.
8.8 Any court, government or governmental agency shall condemn, seize
or otherwise appropriate, or take custody or control of all or any substantial
portion of the property of the Company or any Subsidiary.
28
8.9 The Company or any Subsidiary shall fail within 30 days to pay,
bond or otherwise discharge any judgment or order for the payment of money in
excess of $250,000, which is not stayed on appeal or otherwise being
appropriately contested in good faith.
8.10 The Collateral Agent, for the ratable benefit of the Banks, shall
cease to have a valid and perfected first priority security interest in the
Collateral other than any Money Fund Shares that have not been included in the
Borrowing Base and other than in connection with any release of Collateral
contemplated hereby or by any other Loan Document; or the Company shall assert
the invalidity of any such security interest or the invalidity or
unenforceability of any Collateral Document; or any Collateral Document shall be
terminated without the Collateral Agent's written consent.
8.11 The Commodity Futures Trading Commission (or its successor) shall
revoke or suspend the designation of the Company as a contract market under the
Commodity Exchange Act for any futures contract other than for reasons of
dormancy or low volume in such contract or for reasons of disruptions in the
underlying market for such contract.
ARTICLE IX
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
9.1 ACCELERATION. If any Default described in SECTION 8.6 or 8.7
occurs, the obligations of the Banks to make Loans hereunder shall automatically
terminate and the Obligations shall immediately become due and payable without
any election or action on the part of any Bank. If any other Default occurs, the
Required Banks may terminate or suspend the Commitments of the Banks to make
Loans hereunder, or declare the Obligations to be due and payable, or both,
whereupon such Obligations shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which the Company
hereby expressly waives. In addition, at any time after which the Obligations
have become due and payable and the obligations of the Banks to make Loans
hereunder have terminated in accordance with this Section 9.1, the Collateral
Agent may, with the consent of the Required Banks (or shall, upon the direction
of the Required Banks), enforce any and all rights and interest created under
the Collateral Documents or the UCC, including, without limitation, foreclosing
the security interests created pursuant to the Collateral Documents by any
available judicial procedure, and exercise all other rights and remedies of the
Collateral Agent otherwise available under any other provision of this
Agreement, by operation of
29
law, at equity or otherwise, all of which are hereby expressly preserved and all
of which rights shall be cumulative.
9.2 AMENDMENTS. Subject to the provisions of this Section, the
Required Banks and the Company may enter into agreements supplemental hereto for
the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Banks or the Company hereunder or
waiving any Default hereunder; PROVIDED, HOWEVER, that:
(a) the consent of the Company and all of the Banks shall be required
to (i) reduce the percentage specified in the definition of Required Banks, (ii)
reduce the principal amount of or extend the maturity date for any Advance or
reduce the rate or change the time of payment of interest thereon, (iii) reduce
the rate or change the time of payment of any commitment fee, (iv) adjust the
amount of the Commitment of any Bank except as otherwise permitted herein, (v)
amend SECTION 2.7, 2.8, 5.2 or this SECTION 9.2, (vi) extend the Revolving
Credit Termination Date, (vii) permit the Company to assign its rights under
this Agreement, (viii) amend the definition of "Borrowing Base" or (ix) release
any of the Collateral from the Lien granted pursuant to the Collateral Documents
other than as permitted by this Agreement or any other Loan Document; and
(b) the Company may add a new Bank(s) under the terms of this
Agreement, PROVIDED, HOWEVER, the Aggregate Commitment shall not exceed the
Borrowing Base at such time and each such new Bank shall agree in writing to be
bound by the terms of this Agreement.
9.3 PRESERVATION OF RIGHTS. No delay or omission of the Banks to
exercise any right under the Loan Documents shall impair such right or be
construed to be a waiver of any Default or an acquiescence therein, and the
making of a Loan notwithstanding the existence of a Default or the inability of
the Company to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Banks required pursuant to SECTION 9.2, and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Banks until the Obligations have been paid in full and the
Commitments have been terminated.
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ARTICLE X
COLLATERAL AGENT
10.1 DECLARATION AND ACCEPTANCE OF APPOINTMENT; NO FIDUCIARY DUTIES.
Subject to the terms and conditions hereof, each Bank hereby appoints and
authorizes The Bank of New York to act as its collateral agent hereunder and
under each of the Collateral Documents and other Loan Documents, with such
powers as are expressly delegated to the Collateral Agent by the terms of this
Agreement, the Collateral Documents, and the other Loan Documents, together with
such other powers as are reasonably incidental thereto. The Bank of New York, by
its execution hereof, hereby accepts the appointment made under this SECTION
10.1. The Collateral Agent shall not have any duties or responsibilities except
those expressly set forth in this Agreement, the Collateral Documents and the
other Loan Documents, or be a trustee for, or have any fiduciary obligation to,
any Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities on the part of the Collateral Agent shall be read
into this Agreement or any other Loan Document or otherwise exist for the
Collateral Agent. In performing its functions and duties hereunder and under the
other Loan Documents, the Collateral Agent shall act solely as agent for the
Banks and does not assume nor shall be deemed to have assumed any obligation or
relationship of trust or agency with or for the Company or any of its successors
or assigns. The Collateral Agent shall not be required to take any action that
exposes the Collateral Agent to personal liability or that is contrary to this
Agreement, any other Loan Document or applicable law. The appointment and
authority of the Collateral Agent hereunder shall terminate upon the
indefeasible payment in full of all Obligations and the termination of the
Commitments. Each Bank hereby authorizes the Collateral Agent to execute each of
the Collateral Documents on behalf of such Bank (the terms of which shall be
binding on such Bank).
10.2 RELIANCE BY COLLATERAL AGENT. The Collateral Agent shall in all
cases be entitled to rely, and shall be fully protected in relying, upon any
document or conversation believed by it in good faith to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Company), independent accountants and other experts selected by the
Collateral Agent and acceptable to the Required Banks. The Collateral Agent
shall in all cases be fully justified in failing or refusing to take any action
under this Agreement or any other Loan Document unless it shall first receive
such advice or concurrence of the Company or the Required Banks (or, if
required, all of the Banks), as applicable, as it deems appropriate and it shall
first be indemnified to its satisfaction by the Banks, provided that unless and
until the Collateral Agent shall have received such advice, the Collateral Agent
may take or refrain from taking any action, as the Collateral
31
Agent shall deem advisable and in the best interests of the Banks. The
Collateral Agent shall in all cases be fully protected in acting, or in
refraining from acting, in accordance with a request of the Company or the
Required Banks or all of the Banks, as applicable, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Banks.
10.3 REIMBURSEMENT AND INDEMNIFICATION. The Banks severally agree to
reimburse and indemnify the Collateral Agent and its officers, directors,
employees, representatives and agents ratably in proportion to the amounts of
their respective Commitments, to the extent not paid or reimbursed by the
Company (i) for any amounts for which the Collateral Agent, acting in its
capacity as Collateral Agent, is entitled to reimbursement by the Company
hereunder or under any other Loan Document and (ii) for any other actual
out-of-pocket expenses incurred by the Collateral Agent, in its capacity as
Collateral Agent and acting on behalf of the Banks, in connection with the
administration and enforcement of this Agreement and the other Loan Documents,
except in each case, for any amounts or expenses that arise as a result of the
gross negligence or willful misconduct of the Collateral Agent.
10.4 COLLATERAL AGENT IN ITS INDIVIDUAL CAPACITY. The Collateral Agent
and its affiliates may make loans to, accept deposits from and generally engage
in any kind of business with the Company or any affiliate of the Company as
though the Collateral Agent were not the Collateral Agent hereunder. With
respect to the making of Loans pursuant to this Agreement, the Collateral Agent
shall have the same rights and powers under this Agreement in its individual
capacity as any Bank and may exercise the same as though it were not the
Collateral Agent, and the terms "Bank," and "Banks" shall include the Collateral
Agent in its individual capacity.
10.5 RESIGNATION OR TERMINATION OF COLLATERAL AGENT. The Collateral
Agent may resign its position as such at any time upon ninety (90) days' prior
notice to the Company and the Banks. The Collateral Agent may be terminated by
100% of the Banks (excluding any Bank then acting as Collateral Agent) at any
time upon thirty (30) days' prior notice to the Company, the Collateral Agent
and the other Banks. The Required Banks, with the consent of the Company (such
consent not to be unreasonably withheld), shall appoint a successor Collateral
Agent to succeed any Collateral Agent that resigns or its terminated pursuant to
this SECTION 10.5. Subsequent to the effective date of such resignation or
termination, the resigning or terminated (as applicable) Collateral Agent shall
have no further obligations in that capacity under this Agreement. If no
successor Collateral Agent shall have been appointed by the Company and the
Required Banks and shall have accepted such appointment prior to the effective
date of the resignation or termination of the then acting Collateral Agent, the
resigning or terminated Collateral Agent may appoint a successor Collateral
Agent, which shall be a bank or
32
trust company organized under the laws of the United States of America or any
State thereof, having a combined capital and surplus of at least $500,000,000.
10.6 NON-RELIANCE REPRESENTATION. Each of the Banks acknowledges and
represents that it has, independently of and without reliance upon the
Collateral Agent, and based solely upon its own expertise (and the expertise of
its agents and independent advisors) and upon financial statements and other
information deemed appropriate by it, made its own credit analysis of the
Company and made its own decision to enter into this Agreement. Each of the
Banks further acknowledges and represents that it will, independently of and
without reliance upon the Collateral Agent, and based solely upon its own
expertise (and the expertise of its agents and independent advisors, if any) and
upon such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis of the Company and its own decisions
with respect to this Agreement.
10.7 EXCULPATION. Neither the Collateral Agent nor any of its
shareholders, directors, officers, employees or agents shall be liable to the
Banks, or any of them individually, for any obligation, undertaking, act or
judgment of the Company or any other Person, or for any error of judgment or any
action taken or omitted to be taken by the Collateral Agent (except and to the
extent that the same arises from gross negligence or willful misconduct on the
part of the Collateral Agent), or be bound to ascertain or inquire as to the
performance or observance of any term of any of the Loan Documents. Without
limiting the generality of the foregoing, the Collateral Agent: (a) may consult
with legal counsel selected by it and shall not be liable for any action taken
or omitted to be taken in good faith by it in accordance with the advice of such
counsel; (b) makes no warranty or representation and shall not be responsible
for any warranty or representation made in or in connection with any of the Loan
Documents by any Person other than the Collateral Agent, or for the financial
condition of the Company or any other Person, or for the observance or
performance of any obligations of the Company or any other Person other than the
Collateral Agent, or for the truth or accuracy of any document provided to the
Collateral Agent that the Collateral Agent has initially received from, or that
the Collateral Agent has prepared based upon information received from, the
Company or any other Person, except for the Collateral Agent's responsibility
under SECTION 10.8; (c) makes no warranty or representation and shall not be
responsible for the due execution, validity, enforceability, sufficiency or
collectibility of any of the Loan Documents; (d) shall incur no liability under
or in respect of any such agreement or document by acting upon any notice (by
telephone or otherwise), or writing (including telex and telegraphic
communication) believed by it in good faith to be genuine and to be signed or
sent by the proper party or Person; and (e) makes no warranty or guarantee as
to: (i) future payments by the Company or any other obligor or guarantor of the
Loans, (ii) the Company's future compliance with or
33
performance of any of the terms and conditions contained in the Loan Documents,
or (iii) the collectibility of the Loans.
10.8 COLLATERAL VALUATION. The Collateral Agent shall monitor the
market value of the Collateral. On each Borrowing Date, promptly after receiving
notice from the Company of a proposed borrowing, and on the last day of each
calendar month (or, if such day is not a Business Day, the next succeeding
Business Day), commencing with the first such date to occur after the date
hereof, the Collateral Agent shall determine the aggregate market value of all
Collateral on and as of such date in accordance with its usual and customary
practices and shall advise and notify (which may be by telephone) each Bank
thereof (each a, "COLLATERAL NOTICE").
ARTICLE XI
GENERAL PROVISIONS
11.1 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, except that the Company may not assign or otherwise transfer any of its
rights under this Agreement.
(b) Any Bank may, in accordance with applicable law, at any time
sell to one or more banks, financial institutions or other entities
("PARTICIPANTS") participating interests in any Loan owing to such Bank, any
Note held by such Bank, any Commitment of such Bank or any other interest of
such Bank hereunder. In the event of any such sale by a Bank of participating
interests to a Participant, such Bank's obligations under this Agreement to the
other parties to this Agreement shall remain unchanged, such Bank shall remain
solely responsible for the performance thereof and the Company and the
Collateral Agent shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement and the
other Loan Documents. In no event shall a Bank that sells a participating
interest be obligated to the Participant to take or refrain from taking any
action hereunder or under any of the other Loan Documents except that such Bank
may agree that it will not, without the consent of such Participant, agree to
(A) reduce the principal of, or interest payable on (or reduce the rate of
interest applicable to), the Loans of such Bank or any fees or other amounts
payable to such Bank hereunder which, in each case, are related to the
participation sold to such Participant or, (B) postpone the date fixed for any
34
payment of the principal of, or interest on, the Loans of such Bank or other
amounts payable to such Bank hereunder which, in each case, are related to the
participation sold to such Participant.
(c) Any Bank may (or in accordance with SECTION 11.4(h) shall), in
accordance with applicable law, and with the consent of the Company (such
consent not to be unreasonably withheld), at any time sell to any financial
institution (all such purchasers, collectively, "PURCHASERS") all or any part of
its rights and obligations under this Agreement and the Note held by it pursuant
to an assignment agreement (an "ASSIGNMENT AGREEMENT"), executed by such
Purchaser and such Bank and delivered to the Company and the Collateral Agent;
provided that the consent of the Company to any such assignment shall not be
required if (A) an Event of Default has occurred and is continuing, (B) the
assignment is by a Bank to an Affiliate of such Bank or another existing Bank or
(C) the assignment (including any pledge) is by any Bank of its Notes and its
rights hereunder with respect thereto to any Federal Reserve Bank. Upon such
execution and delivery of an Assignment Agreement, from and after the effective
date as specified therein, (x) the Purchaser thereunder shall be a party hereto
and shall be bound by the provisions hereto and, to the extent provided in such
Assignment Agreement, shall have the rights and obligations of a Bank hereunder,
with its Commitment as set forth in such Assignment Agreement, and (y) the
transferor Bank thereunder shall, to the extent provided in such Assignment
Agreement, be released from its obligations under this Agreement (and, in the
case of an Assignment Agreement covering all or the remaining portion of a
transferor Bank's rights and obligations under this Agreement, such transferor
Bank shall cease to be a party hereto). Upon delivery of the Assignment
Agreement to the Company and the Collateral Agent, the Company, the Collateral
Agent and the Banks may treat the Purchaser as the owner of the Loans recorded
therein for all purposes of this Agreement.
(d) On the effective date specified in any Assignment Agreement, or as
soon as possible thereafter, the Company shall execute and deliver to the
transferor Bank in exchange for the Note held by the transferor Bank (which
existing Note shall be surrendered to the Company), a new Note to the order of
such Purchaser reflecting the Commitment and outstanding Loans obtained by it
pursuant to such Assignment Agreement and, if the transferor Bank has retained a
Commitment and Loans hereunder, a new Note to the order of the transferor Bank
reflecting the Commitment and outstanding Loans retained by it hereunder. Such
new Notes shall be dated the Transfer Effective Date and shall otherwise be in
the form of the Note replaced thereby. The Note surrendered by the transferor
Bank shall be returned by the transferor Bank to the Company marked "canceled".
35
(e) The Company authorizes each Bank to disclose to any Participant or
Purchaser and any prospective Participant or Purchaser any and all financial and
other information in such Bank's possession concerning the Company which has
been delivered to such Bank by or on behalf of the Company pursuant to this
Agreement; PROVIDED that such Participant or Purchaser or prospective
Participant or Purchaser agrees to be bound by the confidentiality provisions
contained in SECTION 11.14.
(f) If, pursuant to this SECTION 11.1, any interest in this Agreement
or any Note is transferred to any Purchaser which is organized under the laws of
any jurisdiction other than the United States or any state thereof, such
Purchaser, concurrently with the effectiveness of such transfer and becoming a
party to this Agreement pursuant to the applicable Assignment Agreement shall,
(i) represent to the transferor Bank (for the benefit of the transferor Bank,
the Collateral Agent and the Company) that under applicable law and treaties
then in effect no United States federal taxes will be required to be withheld by
the Collateral Agent, the Company or the transferor Bank with respect to any
payments to be made to such Purchaser hereunder, (ii) furnish to the Company the
documentation described in SECTION 11.4(f), (wherein such Purchaser claims
entitlement to complete exemption from U.S. federal withholding tax on all
payments hereunder) and (iii) agree to otherwise comply with the terms of
SECTION 11.4(f).
11.2 SURVIVAL OF REPRESENTATIONS. All representations and warranties
of the Company contained in this Agreement shall survive delivery of the Notes
and the making of the Loans herein contemplated.
11.3 GOVERNMENTAL REGULATION. Anything contained in this Agreement to
the contrary notwithstanding, no Bank shall be obligated to extend credit to the
Company in violation of any limitation or prohibition provided by any applicable
statute or regulation.
11.4 TAXES.
(a) All payments to any Bank with respect to the Loans shall be made
free and clear of, and without deduction for any Indemnified Taxes or Other
Taxes; PROVIDED that if the Company shall be required to deduct any Indemnified
Taxes or Other Taxes from such payments, then (i) the sum payable shall be
increased by the amount (the "ADDITIONAL AMOUNT") necessary so that after making
all required deductions (including deductions applicable to additional sums
described in this paragraph) such Bank receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Company shall
36
make such deductions and (iii) the Company shall pay the full amount deducted to
the relevant governmental authority in accordance with applicable law. In
addition, to the extent not paid in accordance with the preceding sentence, the
Company shall pay any Other Taxes to the relevant governmental authority in
accordance with applicable law.
(b) Subject to subsection (h) below, the Company shall indemnify
each Bank for Indemnified Taxes and Other Taxes paid by such Bank, PROVIDED,
HOWEVER, that the Company shall not be obligated to make payment to any Bank in
respect of penalties, interest and other similar liabilities attributable to
such Indemnified Taxes or Other Taxes if such penalties, interest or other
similar liabilities are attributable to the gross negligence or willful
misconduct of such Bank.
(c) If a Bank shall become aware that it is entitled to claim a
refund from a governmental authority in respect of Indemnified Taxes or Other
Taxes paid by the Company pursuant to this SECTION 11.4, including Indemnified
Taxes or Other Taxes as to which it has been indemnified by the Company, or with
respect to which the Company has paid Additional Amounts pursuant hereto, it
shall promptly notify the Company of the availability of such refund claim and,
if such Bank determines in good faith that making a claim for refund will not
have a material adverse effect on its taxes or business operations, shall,
within 30 days after receipt of a request by the Company, make a claim to such
governmental authority for such refund at the Company's expense. If a Bank
receives a refund in respect of any Indemnified Taxes or Other Taxes paid by the
Company pursuant hereto, it shall within 30 days from the date of such receipt
pay over such refund to the Company (but only to the extent of Indemnified Taxes
or Other Taxes paid pursuant to hereto), including indemnity payments made or
Additional Amounts paid, by the Company under this SECTION 11.4 with respect to
the Indemnified Taxes or Other Taxes giving rise to such refund), net of all out
of pocket expenses of such Bank and without interest (other than interest paid
by the relevant governmental authority with respect to such refund).
(d) If any Bank is or becomes eligible under any applicable law,
regulation, treaty or other rule to a reduced rate of taxation, or a complete
exemption from withholding, with respect to Indemnified Taxes or Other Taxes on
payments made to it by the Company, such Bank shall, upon the request, and at
the cost and expense, of the Company, complete and deliver from time to time any
certificate, form or other document requested by the Company, the completion and
delivery of which are a precondition to obtaining the benefit of such reduced
rate or exemption, provided that the taking of such action by such Bank, would
not, in
37
the reasonable judgment of such Bank be disadvantageous or prejudicial to such
Bank or inconsistent with its internal policies or legal or regulatory
restrictions. For any period with respect to which a Bank has failed to provide
any such certificate, form or other document requested by the Company, such Bank
shall not be entitled to any payment under this SECTION 11.4 in respect of any
Indemnified Taxes or Other Taxes that would not have been imposed but for such
failure.
(e) Each Bank organized under the laws of a jurisdiction in the United
States, any State thereof or the District of Columbia (other than Banks that are
corporations or otherwise exempt from United States backup withholding Tax)
shall (i) deliver to the Company, upon execution hereof (or, with respect to
Persons becoming Banks hereunder by assignment, upon execution of the relevant
assignment agreement), two original copies of United States Internal Revenue
Form W-9 or any successor form, properly completed and duly executed by such
Bank, certifying that such Bank is exempt from United States backup withholding
Tax on payments of interest made under the Loan Documents and (ii) thereafter,
at each time it is so reasonably requested in writing by the Company, deliver
within a reasonable time two original copies of an updated Form W-9 or any
successor form thereto.
(f) Each Bank that is organized under the laws of a jurisdiction
other than the United States, any State thereof or the District of Columbia
(each such Bank, a "FOREIGN BANK") that is entitled to an exemption from or
reduction of withholding Tax under the laws of the jurisdiction in which the
Company is located, or any treaty to which such jurisdiction is a party, with
respect to payments under the Loan Documents shall deliver to the Company, upon
execution hereof (or, with respect to Persons becoming Banks hereunder by
assignment, upon execution of the relevant assignment agreement), such properly
completed and duly executed documentation prescribed by applicable law or
reasonably requested by the Company as will permit such payments to be made
without withholding or at a reduced rate, unless in the good faith opinion of
the Foreign Bank such documentation would expose the Foreign Bank to any
material adverse consequences or risk. Such documentation shall be delivered by
each Foreign Bank on or before the date it becomes a Bank and on or before the
date, if any, such Foreign Bank changes its applicable lending office by
designating a different lending office with respect to its Loans (a "NEW LENDING
OFFICE"). In addition, each Foreign Bank shall deliver such forms promptly upon
the obsolescence or invalidity of any form previously delivered by such Foreign
Bank. Each Bank (and, in the case of a Foreign Bank, its lending office),
represents that on the date hereof, payments made hereunder by the Company to it
would not be subject to United States Federal withholding tax.
38
(g) Notwithstanding the provisions of subsection (a) and (b) above,
the Company shall not be required to indemnify any Foreign Bank, or to pay any
Additional Amounts to any Foreign Bank, in respect of United States Federal
withholding tax pursuant to subsection (a) or (b) above, (A) to the extent that
the obligation to withhold amounts with respect to United States Federal
withholding tax existed on the date such Foreign Bank became a Bank; (B) with
respect to payments to a New Lending Office with respect to a Loan, but only to
the extent that such withholding tax exceeds any withholding tax that would have
been imposed on such Bank had it not designated such New Lending Office; (C)
with respect to a change by such Foreign Bank of the jurisdiction in which it is
organized, incorporated, controlled or managed, or in which it is doing
business, from the date such Foreign Bank changed such jurisdiction, but only to
the extent that such withholding tax exceeds any withholding tax that would have
been imposed on such Bank had it not changed the jurisdiction in which it is
organized, incorporated, controlled or managed, or in which it is doing
business; or (D) to the extent that the obligation to pay such indemnity payment
or Additional Amounts would not have arisen but for a failure by such Foreign
Bank to comply with the provisions of SECTION 11.4(f).
(h) If any Bank requests compensation under this SECTION 11.4, or if
the Company is required to pay any additional amount to any governmental
authority for the account of any Bank pursuant to this SECTION 11.4, then such
Bank 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 with the object of
avoiding or eliminating the amounts payable pursuant to this SECTION 11.4,
provided that such designation or assignment shall be on such terms that such
Bank and its lending office, in such Bank's sole judgment, suffer no economic,
legal, regulatory or other disadvantage and would not otherwise be
disadvantageous to such Bank. The Company hereby agrees to pay all reasonable
costs and expenses incurred by any Bank in connection with any such designation
or assignment.
If Bank requests compensation under this SECTION 11.4, or if the Company is
required to pay any additional amount to any governmental authority for the
account of any Bank pursuant to this SECTION 11.4, then the Company may, at its
sole expense and effort, upon notice to such Bank, require such Bank to assign
and delegate, without recourse, in accordance with and subject to the
restrictions contained in SECTION 11.1, all of such Bank's interests, rights and
obligations under this Agreement to one or more assignees that shall assume such
obligations (which assignee or assignees may be one or more other Banks);
PROVIDED, that (i) such Bank shall have received payment of an amount equal to
the outstanding principal of its Loans, accrued and unpaid interest thereon,
accrued and unpaid fees and all other
39
amounts payable to it hereunder from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Company (in the case
of all other amounts) and (ii) such assignment will result in a reduction in
such compensation or payments. A Bank shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Bank or otherwise, the circumstances entitling the Company to require such
assignment and delegation cease to apply.
A certificate of the relevant Bank setting forth the basis for any amounts (and
the calculation thereof and methodology in calculating, each in reasonable
detail) claimed under this SECTION 11.4 shall be delivered to the Company and
shall be conclusive absent manifest error. Failure or delay on the part of a
Bank to demand compensation of any amount under this Section shall not
constitute a waiver of such Bank's right to demand such compensation; PROVIDED
that the Company shall not be required to compensate any such Bank for any
amounts claimed under this Section that are incurred more than 90 days prior to
the date that such Bank notifies the Company of the circumstances giving rise to
such amounts and such Bank's intention to claim compensation therefor; provided,
further, that if the circumstances giving rise to such amounts have retroactive
effect, then the 90-day period referred to above shall be extended to include
the period of retroactive effect thereof.
(i) Any payment required to be made by the Company to any Bank under
this SECTION 11.4 shall be deemed an Obligation and be secured by the
Collateral.
11.5 CHOICE OF LAW; JURISDICTION. The Loan Documents (other than those
containing a contrary express choice of law provision) shall be construed in
accordance with the laws of the State of
Illinois (excluding choice-of-law
principles of the law of such State that would require the application of the
laws of a jurisdiction other than such State), but giving effect to federal laws
applicable to national banks. The Company and the Banks hereby irrevocably
submit to the non-exclusive jurisdiction of any United States federal or
Illinois state court sitting in Chicago in any action or proceedings arising out
of or relating to any Loan Documents and the Company and the Banks hereby
irrevocably agree that all claims in respect of such action or proceeding may be
heard and determined in any such court.
11.6 HEADINGS. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
40
11.7 ENTIRE AGREEMENT. The Loan Documents embody the entire agreement
and understanding among the Company and the Banks and supersede all prior
agreements and understandings among the Company and the Banks relating to the
subject matter thereof, including the Existing Agreement.
11.8 SEVERAL OBLIGATIONS. The respective obligations of the Banks
hereunder are several and not joint and no Bank shall be the partner or agent of
any other. The failure of any Bank to perform any of its obligations hereunder
shall not relieve any other Bank from any of its obligations hereunder.
11.9 EXPENSES; INDEMNIFICATION.
(a) The Company shall reimburse the Collateral Agent and each Bank
for any reasonable costs, internal charges and out-of-pocket expenses (including
attorneys' fees and time charges of attorneys, which attorneys may be employees
of the Collateral Agent or such Bank, as applicable) paid or incurred by the
Collateral Agent or such Bank, as applicable, in connection with the collection,
liquidation and enforcement of the Loan Documents and/or the Collateral. The
Company further agrees to indemnify the Collateral Agent, each Bank and their
respective directors, officers and employees (each an "INDEMNIFIED PARTY")
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all expenses of litigation or
preparation therefor) which any of them may pay or incur arising out of or
relating to this Agreement, the other Loan Documents, the transactions
contemplated hereby or the direct or indirect application or proposed
application of the proceeds of any Loan hereunder (all of the foregoing being
collectively referred to as "INDEMNIFIED AMOUNTS"), excluding, however, in all
of the foregoing instances, Indemnified Amounts arising from the gross
negligence or willful misconduct on the part of the Indemnified Party seeking
indemnification and Indemnified Amounts consisting of taxes imposed on or
measured by the overall net income of the Indemnified Party seeking
indemnification.
(b) If, after the date hereof, any law or any governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) is adopted, or there is any change in the interpretation thereof, or the
compliance of any Bank with such, which, in any case, affects the amount of
capital required or expected to be maintained by the Bank or any corporation
controlling any Bank and any Bank reasonably determines the amount of capital
required is increased by or based upon the existence of this Agreement or its
Commitment hereunder, then, the Bank shall notify the Company of such fact and
shall provide a reasonably detailed description of such increased costs in the
notice ("INCREASED COST NOTICE"), together with documentation from the relevant
regulatory body setting forth such increased capital requirement, and within 15
days of the Company's receipt of such Increased
41
Cost Notice, the Company shall, in its sole discretion, determine whether to
terminate such Bank's Commitment and obligation to make Loans hereunder, or to
attempt to negotiate with such Bank a revised commitment fee (which revision
shall not constitute an amendment to SECTION 2.8 hereof for the purposes of
SECTION 9.2) and any other reimbursements provided for hereunder which reflect
the Bank's increased costs. In the event that the Company determines to
terminate such Bank's Commitment and obligation to make Loans hereunder, the
Company shall send written notice to the Bank within 15 days of the Company's
receipt of the Increased Cost Notice specifying a date at least 30 days
thereafter on which the Bank's Commitment and obligation to make Loans hereunder
shall be terminated. In the event that the Company determines to attempt to
negotiate with such Bank a revised commitment fee and other reimbursements, and
the Company and the Bank are unable to agree, within 30 days of the date of the
Increased Cost Notice, upon such revised fees and other reimbursements, the Bank
may send written notice to the Company, or the Company may send written notice
to the Bank specifying a date at least 30 days thereafter on which the Bank's
Commitment and obligation to make Loans hereunder shall be terminated. Any
payment required to be made by the Company under this SECTION 11.9(b) shall be
deemed an Obligation and be secured by the Collateral.
(c) At least 45 days prior to the proposed consummation date of any
merger or consolidation of the Company with or into any other Person in which
the Company shall not be the surviving entity (such transaction, a
"RESTRUCTURING"), the Company will give written notice thereof to each Bank (a
"RESTRUCTURING NOTICE"), which notice shall set forth the material terms and
conditions of such Restructuring, including the identity of the surviving entity
of such Restructuring (the "SURVIVOR"). Upon receipt of a Restructuring Notice,
a Bank may elect, in its sole discretion, to terminate its Commitment hereunder
by notifying the Company thereof, which may be by telephone (a "TERMINATION
NOTICE") within 15 days of such Bank's receipt of the Restructuring Notice,
which termination shall become effective no sooner than 30 days after the
Company's receipt of the Termination Notice. Any Bank that fails to deliver a
Termination Notice within 15 days after its receipt of a Restructuring Notice
shall be deemed to have elected to terminate its Commitment.
(d) The effective date of any termination of a Bank's Commitment
hereunder pursuant to subsection (b) or (c) above is referred to herein as the
"ACCELERATED TERMINATION DATE". Any such termination shall not accelerate the
maturity of any Loans outstanding to such Bank; commitment fees to such Bank
shall cease to accrue as of the Accelerated Termination Date; and the Company
shall be responsible for any and all Obligations and accrued and unpaid costs
(including increased costs), fees and expenses incurred with respect to such
Bank prior to the
42
Accelerated Termination Date. The obligations of the Company under this SECTION
11.9 shall survive the termination of this Agreement.
11.10 ACCOUNTING. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with Agreement Accounting
Principles.
11.11 SEVERABILITY OF PROVISIONS. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
11.12 PARENT HOLDING COMPANY. The Banks acknowledge that: (i) a
corporation, CME Holdings, Inc. ("HOLDINGS"), is currently being organized under
the laws of the State of Delaware, (ii) upon consummation of such organization
all of the capital stock of the Company currently held by its shareholders will
be transferred to Holdings in exchange for share of the capital stock of
Holdings and (iii) upon consummation of such exchange, the Company will be a
wholly-owned subsidiary of Holdings.
11.13 AMENDMENT AND RESTATEMENT.
(a) The effect of this Agreement is to amend and restate the
Existing Agreement, and to the extent that any rights, benefits or provisions in
favor of any of the parties to the Existing Agreement existed in the Existing
Agreement and continue to exist in this Agreement without any written waiver of
any such rights, benefits or provisions prior to the date hereof, then such
rights, benefits or provisions are acknowledged to be and to continue to be
effective from and after the date of the Existing Agreement. This Agreement is
not a novation.
(b) The parties hereto agree and acknowledge that any and all rights
and provisions under the Existing Agreement, which expressly survive any
termination of the Existing Agreement shall continue and survive the execution
and delivery of this Agreement.
11.14 CONFIDENTIALITY. Each of the Banks and the Collateral Agent
agrees to maintain the confidentiality of the Company Information, except that
Company Information may be disclosed (a) to its Affiliates, directors, officers,
employees and agents, including accountants, legal counsel and other advisors
who have a need to know such information (it being understood that the Persons
to whom such disclosure is made will be informed of the confidential nature of
such Company
43
Information and agree to keep such Company Information confidential on terms
substantially similar to this SECTION 11.14), (b) to any governmental agency or
representative thereof, provided that prior to such disclosure, the disclosing
party shall, to the extent practicable, promptly inform the Company of such
potential disclosure, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process or to the extent
reasonably required in connection with any litigation relating to this Agreement
or the Collateral to which such Bank or the Collateral Agent, as applicable, is
a party, (d) subject to an agreement containing provisions substantially the
same as those described in this SECTION 11.14, to any Purchaser or Participant
or any prospective Purchaser or Participant, (e) with the consent of the Company
or (f) to the extent such Company Information becomes publicly available other
than as a result of a breach of its confidentiality obligations as described in
this SECTION 11.14.
As used in this Section, "COMPANY INFORMATION" means all information
received from the Company or any of its Subsidiaries or Affiliates relating to
the Company, any of its Subsidiaries or Affiliates, or their businesses, other
than any such information that is available to the Collateral Agent or any Bank,
as applicable, on a non-confidential basis prior to disclosure by the Company.
11.15 WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR ANY MATTER ARISING HEREUNDER OR THEREUNDER.
ARTICLE XII
SETOFF; RATABLE PAYMENTS
12.1 SETOFF; RATABLE PAYMENTS.
(a) In addition to, and without limitation of, any rights of the
Banks under applicable law, if the Company becomes insolvent, however evidenced,
or any Default occurs and is continuing, any indebtedness from any Bank to the
Company (including all account balances, whether provisional or final and
whether or not collected or available but excluding any accounts designated as
or representing "customer segregated funds" accounts and any accounts pledged to
such Bank to secure an overdraft facility to ensure the settlement of foreign
currency futures and options contracts traded on the Company) may be offset and
applied
44
toward the payment of the Obligations owing to such Bank, whether or not the
Obligations, or any part thereof, shall then be due.
(b) If any Bank, whether by setoff or otherwise, has payment made to
it upon any Loan in a greater proportion than that received by any other Bank
upon any Loan constituting a portion of the same Advance, such Bank (or, if
applicable, such Bank's Servicing Bank) shall distribute to all the other Banks
(of, if applicable, such other Banks' Servicing Banks) an amount equal to their
pro rata share of such payment. Such payment shall be distributed ratably
between the Banks in proportion to each Bank's respective share of the total
Obligations outstanding under this Agreement. Any payment distributed pursuant
to this subsection (b) to a Servicing Bank shall be distributed by the Servicing
Banks to the applicable Banks in accordance with the provisions of this
Agreement.
(c) If any Bank, whether in connection with setoff or amounts which
might be subject to setoff or otherwise, receives collateral or other protection
for any category of its Obligations or such amounts which may be subject to
setoff, in any case, in excess of its pro rata share thereof, such Bank agrees,
promptly upon demand, to take such action necessary such that all Banks share in
the benefits of such collateral ratably in proportion to their Obligations of
the same category. In case any such payment is disturbed by legal process, or
otherwise, appropriate further adjustments shall be made.
(d) The Company agrees that any holder of a participation in a Loan
may, to the fullest extent permitted by law, exercise all its rights of payment
with respect to such participation as if such holder were the direct creditor of
the Company in the amount of the participation.
ARTICLE XIII
NOTICES
13.1 GIVING NOTICE. Except as otherwise herein provided, any notice
required or permitted to be given under this Agreement shall be in writing and
shall be deemed, given (i) when delivered if sent by an overnight courier
service, or (ii) when sent by facsimile, telex or SWIFT message, in each case,
addressed to the Company and the Banks at the addresses or transmission numbers
indicated below their signatures to the Agreement or otherwise notified to the
Company or the Banks, as applicable.
45
13.2 CHANGE OF ADDRESS. The Company and any Bank may each change the
address for service of notice upon it by a notice in writing to the other
parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Company and the
Banks.
ARTICLE XV
SUBORDINATION
The Company hereby subordinates its Lien on the Collateral to the Lien
therein granted to the Collateral Agent pursuant to the Collateral Documents,
and, except as permitted by SECTION 2.9, the Company shall not take any action
of any nature whatsoever to enforce its Lien until all of the Obligations have
been paid in full and the Commitments have been terminated.
46
IN WITNESS WHEREOF, the Company and the Banks have executed this
Agreement as of the date first above written.
CHICAGO MERCANTILE EXCHANGE INC.
(A Delaware Corporation)
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------
Title: President and CEO
Date: October 19, 2001
----------------------------------
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: ▇▇▇▇▇▇▇▇
Attention: Managing Director & President,
Clearing House Division
S-1
COMMITMENTS
$50,000,000 THE BANK OF NEW YORK,
individually and as Collateral Agent
By: _____________________________
Title:___________________________
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇
References: Chicago Mercantile Exchange
Inc., Borrowings, Payments Etc.
S-2
$ 50,000,000 BANK OF AMERICA, N.A.
By: ____________________________
Title:__________________________
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Reference: Loan Payment - Chicago Mercantile
Exchange Inc.
S-3
$ 25,000,000 ▇▇▇▇▇ BROTHERS ▇▇▇▇▇▇▇▇ & CO.
By: _____________________________
Title:___________________________
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: ▇▇▇▇▇▇▇▇
Attention: Senior Credit Officer
S-4
$ 50,000,000 THE CHASE MANHATTAN BANK
By: ____________________________
Title:__________________________
▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: CHASU33
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇-▇
$ 50,000,000 BANK ONE, NA
By: ______________________________
Title:____________________________
1 Bank ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telex: 6732667
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: FNBCUS44
Attention: Financial Institutions Division
S-6
$ 50,000,000 ▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By: _____________________________
Title:___________________________
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: ▇▇▇▇▇▇▇▇
▇-▇
$ 50,000,000 THE BANK OF TOKYO-MITSUBISHI, LTD
By:______________________________
Title:____________________________
Chicago Branch
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S.W.I.F.T.: BOTKUS4C
Reference: Chicago Mercantile Exchange
S-8
$ 35,000,000 CITIBANK, N.A.
By: ______________________________
Title:____________________________
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Reference: Chicago Mercantile
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S-9
$ 25,000,000 HSBC BANK USA
By:______________________________
Title:____________________________
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Re: Chicago Mercantile Exchange Inc.
S-10
$ 15,000,000 THE NORTHERN TRUST COMPANY
By:______________________________
Title:____________________________
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Reference: Chicago Mercantile Exchange Inc.
S-11
$ 25,000,000 U.S. BANK NATIONAL ASSOCIATION
By:______________________________
Title:____________________________
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MK-FC-GLCB
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S-12
$ 50,000,000 UBS, AG STAMFORD BRANCH
By:______________________________
Title:____________________________
By:______________________________
Title:____________________________
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Reference: Chicago Mercantile Exchange Inc.
S-13
$ 25,000,000 SVENSKA HANDELSBANKEN AB (PUBL)
By:______________________________
Title:____________________________
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S.W.I.F.T.: HAND US33
S-14
EXHIBIT A
NOTE
$[AMOUNT]
[MONTH] [DAY], [YEAR]
Chicago Mercantile Exchange Inc., a Delaware corporation (the "COMPANY"),
promises to pay to the order of ____________ (the "BANK") the lesser of the
principal sum of _____________________ and 00/100 Dollars or the aggregate
unpaid principal amount of all Loans made by the Bank to the Company pursuant to
SECTION 2.1 of the First Amended and Restated
Credit Agreement, dated as of
October 19, 2001, among the Company, the Banks party thereto and The Bank of New
York, as Collateral Agent (as amended, restated, supplemented or otherwise
modified from time to time, the "AGREEMENT"), whichever is less, in immediately
available funds at the office of _______________ in [CITY], [STATE], together
with interest on the unpaid principal amount hereof until maturity at a rate per
annum equal to the sum of the Fed Funds Rate, plus 45/100 of 1% per annum from
time to time in effect. After maturity and until paid in full, the Loans shall
bear interest at a rate per annum equal to the sum of the Fed Funds Rate, plus
2.4% per annum. Interest shall be calculated on the basis of a 360 day year for
actual number of days elapsed. The Company shall pay each Loan in full thirty
days after such Loan is made. Interest prior to maturity shall be payable on the
date on which the relevant Loan is paid or prepaid, whether due to acceleration
or otherwise. Interest after maturity shall be payable on demand.
The Bank shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder. The records of the Bank shall be presumed to be accurate and
shall be binding upon the Company absent manifest error.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Agreement and the other Loan Documents, to which Agreement and
Loan Documents reference is hereby made for a statement of the terms and
conditions under which this Note may be prepaid or its maturity date
accelerated. Capitalized terms used herein and not otherwise defined herein are
used with the meanings attributed to them in the Agreement.
CHICAGO MERCANTILE EXCHANGE INC.
(A Delaware corporation)
By______________________________
Title:____________________________