EXHIBIT 4.8
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AMENDED AND RESTATED TERM LOAN AND REVOLVING CREDIT
AGREEMENT
dated as of
February 19, 2004
among
THE GOODYEAR TIRE & RUBBER COMPANY,
as Borrower,
The Lenders Party Hereto,
JPMORGAN CHASE BANK,
as Administrative Agent,
CITICORP USA, INC.,
as Syndication Agent,
Bank of America, N.A.,
as Documentation Agent,
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Documentation Agent
and
GENERAL ELECTRIC CAPITAL CORPORATION,
as Documentation Agent
▇.▇. ▇▇▇▇▇▇ SECURITIES INC., CITIGROUP GLOBAL MARKETS INC.,
as Joint Lead Arranger as Joint Lead Arranger
and Joint Bookrunner and Joint Bookrunner
[CS&M #6701-315]
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions
SECTION 1.01. Defined Terms............................................................................ 1
SECTION 1.02. Classification of Loans and Borrowings................................................... 37
SECTION 1.03. Foreign Currency Translation............................................................. 37
SECTION 1.04. Terms Generally.......................................................................... 37
SECTION 1.05. Accounting Terms; GAAP................................................................... 38
ARTICLE II
The Credits
SECTION 2.01. Commitments.............................................................................. 38
SECTION 2.02. Loans and Borrowings..................................................................... 39
SECTION 2.03. Requests for Borrowing................................................................... 39
SECTION 2.04. Letters of Credit........................................................................ 40
SECTION 2.05. Funding of Borrowings.................................................................... 45
SECTION 2.06. Interest Elections....................................................................... 45
SECTION 2.07. Termination of Commitments; Reductions of Commitments.................................... 47
SECTION 2.08. Repayment of Loans; Evidence of Debt..................................................... 47
SECTION 2.09. Prepayment of Loans...................................................................... 48
SECTION 2.10. Fees..................................................................................... 50
SECTION 2.11. Interest................................................................................. 51
SECTION 2.12. Alternate Rate of Interest............................................................... 52
SECTION 2.13. Increased Costs.......................................................................... 52
SECTION 2.14. Break Funding Payments................................................................... 53
SECTION 2.15. Taxes.................................................................................... 54
SECTION 2.17. Mitigation Obligations; Replacement of Lenders........................................... 57
ARTICLE III
Representations and Warranties
SECTION 3.01. Organization; Powers..................................................................... 58
SECTION 3.02. Authorization; Enforceability............................................................ 58
SECTION 3.03. Governmental Approvals; No Conflicts..................................................... 58
SECTION 3.04. Financial Statements; No Material Adverse Change......................................... 59
SECTION 3.05. Litigation and Environmental Matters..................................................... 59
SECTION 3.06. Compliance with Laws and Agreements...................................................... 59
SECTION 3.07. Investment and Holding Company Status.................................................... 60
SECTION 3.08.(a) ERISA and Canadian Pension Plans...................................................... 60
SECTION 3.09. Disclosure............................................................................... 60
SECTION 3.10. Security Interests....................................................................... 60
SECTION 3.11. Use of Proceeds. The proceeds of the Loans will be used only for the purposes
referred to in the preamble to this Agreement.................................. 61
ARTICLE IV
Conditions
SECTION 4.01. Each Credit Event........................................................................ 61
ARTICLE V
Affirmative Covenants
SECTION 5.01. Financial Statements and Other Information............................................... 62
SECTION 5.02. Notices of Defaults...................................................................... 64
SECTION 5.03. Existence; Conduct of Business........................................................... 64
SECTION 5.04. Maintenance of Properties................................................................ 64
SECTION 5.05. Books and Records; Inspection and Audit Rights; Access Rights............................ 65
SECTION 5.06. Compliance with Laws..................................................................... 66
SECTION 5.07. Insurance................................................................................ 66
SECTION 5.08. Guarantees and Collateral................................................................ 66
SECTION 5.09. Borrowing Base Certificate............................................................... 68
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness and Preferred Equity Interests.............................................. 69
SECTION 6.02. Liens.................................................................................... 72
SECTION 6.03. Sale and Leaseback Transactions.......................................................... 75
SECTION 6.04. Fundamental Changes...................................................................... 75
SECTION 6.05. Investments, Loans, Advances and Guarantees.............................................. 76
SECTION 6.06. Asset Dispositions....................................................................... 78
SECTION 6.07. Restricted Payments...................................................................... 79
SECTION 6.08. Capital Expenditures..................................................................... 80
SECTION 6.09. Interest Expense Coverage Ratio.......................................................... 81
SECTION 6.10. Consolidated Net Worth................................................................... 81
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ARTICLE VII
Events of Default; Inter-Tranche Agreements With Respect to Collateral
SECTION 7.01. Events of Default........................................................................ 81
SECTION 7.02. Inter-Tranche Agreements With Respect to Collateral...................................... 84
ARTICLE VIII
The Agents
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices................................................................................. 89
SECTION 9.02. Waivers; Amendments..................................................................... 89
SECTION 9.03. Expenses; Indemnity; Damage Waiver...................................................... 91
SECTION 9.04. Successors and Assigns.................................................................. 93
SECTION 9.05. Survival................................................................................ 97
SECTION 9.06. Counterparts; Integration; Effectiveness................................................ 97
SECTION 9.07. Severability............................................................................ 97
SECTION 9.08. Right of Setoff......................................................................... 97
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.............................. 98
SECTION 9.10. WAIVER OF JURY TRIAL.................................................................... 98
SECTION 9.11. Headings................................................................................ 99
SECTION 9.12. Confidentiality......................................................................... 99
SECTION 9.13. Interest Rate Limitation................................................................ 99
SECTION 9.14. Security Documents...................................................................... 100
SECTION 9.15. Additional Financial Covenants.......................................................... 100
SCHEDULES:
Schedule 1.01 -- Consent Subsidiaries
Schedule 2.01 -- Commitments
Schedule 3.10(b) -- Material Trademarks
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.06 -- Asset Dispositions
EXHIBITS:
Exhibit A -- Form of Borrowing Request
iii
Exhibit B -- Form of Interest Election Request
Exhibit C -- Form of Promissory Note
Exhibit D -- Form of Assignment and Assumption
Exhibit E -- Form of Borrowing Base Certificate
Exhibit F-1 -- Form of Opinion of Borrower's Outside Counsel
Exhibit F-2 -- Form of Opinion of Borrower's General Counsel
Exhibit G -- Form of Master Guarantee and Collateral Agreement
Exhibit H -- Permitted Asset Sale Provision for Senior Subordinated-Lien
Indebtedness
iv
AMENDED AND RESTATED TERM LOAN AND REVOLVING
CREDIT AGREEMENT dated as of February 19, 2004 (this
"Agreement"), among THE GOODYEAR TIRE & RUBBER COMPANY;
the LENDERS party hereto; JPMORGAN CHASE BANK, as
Administrative Agent; CITICORP USA, INC., as Syndication
Agent; BANK OF AMERICA, N.A., as Documentation Agent;
THE CIT GROUP/BUSINESS CREDIT, INC., as Documentation
Agent; and GENERAL ELECTRIC CAPITAL CORPORATION, as
Documentation Agent.
As part of a refinancing and restructuring of certain bank credit
and receivables securitization facilities of the Borrower and the Subsidiaries
(the "Refinancing") the Borrower, certain of the Lenders party hereto, the
Administrative Agent, the Syndication Agent and the Documentation Agents entered
into a Term Loan and Revolving Credit Agreement dated as of March 31, 2003 (the
"Original Credit Agreement"). The Borrower has requested, and the other parties
hereto have agreed, to amend and restate the Original Credit Agreement in the
form of this Agreement, under which the Lenders are willing to maintain and
extend credit to the Borrower on the terms and subject to the conditions herein
set forth in the form of (a) Tranche A Term Loans that were made on the Original
Effective Date in an aggregate principal amount of $800,000,000, (b) Tranche B
Term Loans to be made on the Restatement Effective Date in an aggregate
principal amount of $650,000,000 and (c) Revolving Loans available at any time
and from time to time prior to the Maturity Date in an aggregate principal
amount not in excess of $500,000,000 at any time outstanding. The proceeds of
the Term Loans and the Revolving Loans have been used or will be used, as the
case may be, for general corporate purposes of the Borrower and the
Subsidiaries.
Accordingly, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"ABL Facilities Collateral" has the meaning assigned to such term in
the Guarantee and Collateral Agreement.
"ABL Facilities Grantor" has the meaning assigned to such term in
the Guarantee and Collateral Agreement.
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Access Agreement" means a written agreement granting access rights
with respect to any Accounts or Inventory of the Borrower or any of the other
Grantors located at any third party location, in form and substance reasonably
satisfactory to the Administrative Agent.
"Account" has the meaning specified in the UCC.
"Account Debtor" means the Person who is primarily obligated under,
with respect to or on account of an Account.
"Accounts Receivable Reserves" means, on any date, an amount
(calculated in accordance with the current and historical accounting practices
of the Borrower) equal to the sum of reserves for volume rebates, cash
discounts, Federal excise taxes and warranties maintained on the Borrower's
general ledger with respect to Eligible Accounts Receivable, in each case
without duplication of any amounts that are included in the Dilution Factors for
such period or excluded from the value of Eligible Accounts Receivable pursuant
to the definition thereof, and each such reserve to be subject to adjustment by
the Administrative Agent or the Majority Borrowing Base Lenders in their
discretion (not to be exercised unreasonably) based on the results of collateral
and borrowing base evaluations (including with respect to Customer Capital
Expenditures) and monitoring conducted by the Administrative Agent and its
designated representatives. Any such adjustment by the Administrative Agent or
the Majority Borrowing Base Lenders shall be made by written notice to the
Borrower setting forth in reasonable detail the basis for such adjustment, and
shall become effective for purposes of the first Borrowing Base Certificate that
is delivered pursuant to Section 5.09 at least five Business Days after the date
of receipt by the Borrower of such written notice.
"Additional Inventory Reserves" means, on any date, an amount equal
to the sum of the following reserves established by the Administrative Agent
with respect to Eligible Inventory, without duplication of any deductions made
pursuant to the definitions of "Eligible Inventory", "Inventory Reserves" and
"Inventory Value":
(a) a reserve for "slow moving" Eligible Inventory equal to
75% of the amount in excess of a 12 month supply on hand;
(b) a reserve for (i) private label Eligible Inventory
relating to the North America Tire Division and (ii) private label
Eligible Inventory relating to the Engineered Products Division;
(c) a reserve for freight, duties and insurance for Eligible
Inventory representing in transit Inventory equal to $5,000,000;
(d) a reserve for shrink or discrepancies that arise
pertaining to Eligible Inventory quantities on hand between the
Borrower's perpetual accounting system and physical counts of the
Eligible Inventory which will be equal to the amount of any such
discrepancy, if any, that is in excess of 2.0%; and
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(e) any other reserve as deemed appropriate by the
Administrative Agent or the Majority Borrowing Base Lenders in their
discretion (not to be exercised unreasonably) based on the results
of collateral and borrowing base evaluations and monitoring
conducted by the Administrative Agent and its designated
representatives.
The reserves described in clauses (a), (b), (c), (d) and (e) above
shall be subject to adjustment (and, in the case of clause (e), establishment)
by the Administrative Agent or the Majority Borrowing Base Lenders in their
discretion (not to be exercised unreasonably) based on the results of collateral
and borrowing base evaluations and monitoring conducted by the Administrative
Agent and its designated representatives. Any such adjustment or the
establishment of a reserve pursuant to clause (e) by the Administrative Agent or
the Majority Borrowing Base Lenders shall be made by written notice to the
Borrower setting forth in reasonable detail the basis for such adjustment or
reserve, and shall become effective for purposes of the first Borrowing Base
Certificate that is delivered pursuant to Section 5.09 at least five Business
Days after the date of receipt by the Borrower of such written notice.
"Adjusted Eligible Accounts Receivable" means, on any date, an
amount equal to (a) Eligible Accounts Receivable minus (b) the sum of, without
duplication, (i) the Dilution Reserve and (ii) the Accounts Receivable Reserves.
"Adjusted Eligible Finished Goods" means, on any date and with
respect to any division of the Borrower, an amount equal to (a) Eligible
Finished Goods relating to such division minus (b) the Inventory Reserves with
respect to the Eligible Inventory included in such Eligible Finished Goods minus
(c) the Additional Inventory Reserves with respect to the Eligible Inventory
included in such Eligible Finished Goods.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means JPMCB, in its capacity as
administrative agent for the Lenders hereunder, and its successors in such
capacity.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Agents" means the Administrative Agent and the Collateral Agent.
"Alternate Base Rate" means, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a
3
change in the Prime Rate or the Federal Funds Effective Rate shall be effective
from and including the effective date of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.
"Applicable Percentage" means, with respect to any Lender, the
percentage of the total unused Revolving Commitments and outstanding Revolving
Loans and LC Exposures represented by such Lender's unused Revolving Commitment
and outstanding Revolving Loans and LC Exposure. If the Revolving Commitments
have terminated or expired and there remain no outstanding Revolving Loans or LC
Exposures, the Applicable Percentages shall be determined based upon the
Revolving Commitments most recently in effect and/or the Revolving Loans and LC
Exposures most recently outstanding, giving effect to any assignments.
"Approved Fund" means (a) with respect to any Lender, a CLO managed
by such Lender or by an Affiliate of such Lender and (b) with respect to any
Lender that is a fund which invests in bank loans and similar extensions of
credit, any other fund that invests in bank loans and similar extensions of
credit and is managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"Arrangers" means ▇.▇. ▇▇▇▇▇▇ Securities Inc. and Citigroup Global
Markets Inc., as Joint Lead Arrangers and Joint Bookrunners for the credit
facilities established by this Agreement.
"Assignment and Assumption" means an assignment and assumption
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Exhibit D or any other form approved by the Administrative Agent.
"Attributable Debt" means, with respect to any Sale and Leaseback
Transaction, the present value (computed in accordance with GAAP and, in the
case of a Sale and Leaseback Transaction that does not result in Capital Lease
Obligations, as if the obligations incurred in connection with such Sale and
Leaseback Transaction were Capital Lease Obligations) of the total obligations
of the lessee for rental payments during the remaining term of the lease
included in such Sale and Leaseback Transaction (including any period for which
such lease has been extended). In the case of any lease which is terminable by
the lessee upon payment of a penalty, the Attributable Debt shall be the lesser
of (i) the Attributable Debt determined assuming termination upon the first date
such lease may be terminated (in which case the Attributable Debt shall also
include the amount of the penalty, but no rent shall be considered as required
to be paid under such lease subsequent to the first date upon which it may be so
terminated) and (ii) the Attributable Debt determined assuming no such
termination.
"Availability Block" means an amount equal to $50,000,000.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
4
"Borrower" means The Goodyear Tire & Rubber Company, an Ohio
corporation.
"Borrowing" means Loans of the same Class and Type, made, converted
or continued on the same date and, in the case of Eurodollar Loans, as to which
a single Interest Period is in effect.
"Borrowing Base" means, at the time of any determination, an amount
equal to the sum of, without duplication, (a) 85% of Adjusted Eligible Accounts
Receivable and (b) (i) if the Effective Advance Rate is equal to or greater than
the percentage equal to 85% of the Recovery Rate, 85% multiplied by the Recovery
Rate multiplied by the Inventory Value of all Inventory of the Borrower and each
other Grantor or (ii) if the Effective Advance Rate is less than the percentage
equal to 85% of the Recovery Rate, (A) the sum of (x) 35% of Eligible Raw
Materials plus (y) 65% of Adjusted Eligible Finished Goods relating to the North
American Tire Division plus (z) 60% of Adjusted Eligible Finished Goods relating
to the Retail Division, the Engineered Products Division, the Chemical Products
Division and the Wingfoot Division, respectively, minus (B) the Rent Reserve,
minus (C) the Priority Payables Reserve (the amount in clause (ii) collectively,
the "Inventory Advance Amount"). The Borrowing Base at any time shall be
determined by reference to the most recent Borrowing Base Certificate delivered
to the Administrative Agent pursuant to Section 5.09. Subject to the provisions
of Section 9.02(b)(ix), standards of eligibility and reserves relating to the
components of the Borrowing Base may be revised and adjusted from time to time
by the Administrative Agent or the Majority Borrowing Base Lenders in their
discretion (not to be exercised unreasonably) based on the results of collateral
and borrowing base evaluations and monitoring conducted by the Administrative
Agent and its designated representatives. Any such revision or adjustment by the
Administrative Agent or the Majority Borrowing Base Lenders shall be made by
written notice to the Borrower setting forth in reasonable detail the basis for
such revision or adjustment, and shall become effective for purposes of the
first Borrowing Base Certificate that is delivered pursuant to Section 5.09 at
least five Business Days after the date of receipt by the Borrower of such
written notice.
"Borrowing Base Availability" means, at the time of any
determination, an amount equal to (a) the lesser of (i) the Borrowing Base at
such time minus the aggregate principal amount of the outstanding Tranche A Term
Loans at such time and (ii) the aggregate amount of the Revolving Commitments at
such time, minus (b) the Availability Block.
"Borrowing Base Certificate" means a certificate substantially in
the form of Exhibit E hereto (with such changes therein as may be reasonably
requested by the Administrative Agent from time to time to reflect the
components of and reserves against the Borrowing Base as provided for hereunder
from time to time), executed and certified on behalf of the Borrower as accurate
and complete in all material respects by a Financial Officer of the Borrower,
which shall include appropriate exhibits, schedules, supporting documentation
and additional reports as (a) outlined in Exhibit E hereto, (b) reasonably
requested by the Administrative Agent and (c) provided for in Section 5.09.
5
"Borrowing Request" means a request by the Borrower for a Borrowing
in accordance with Section 2.03 in substantially the form of Exhibit A hereto.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that, when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Canadian Benefit Plans" means all material employee benefit plans
of any nature or kind whatsoever that are not Canadian Pension Plans and are
maintained or contributed to by any Credit Party having employees in Canada.
"Canadian Dollars" refers to lawful money of Canada.
"Canadian Pension Plans" means each plan which is a registered
pension plan within the meaning of the Income Tax Act (Canada).
"Canadian Security Agreements" has the meaning assigned to
such term in the Guarantee and Collateral Agreement.
"Capital Expenditures" means, for any period, (a) the
additions to property, plant and equipment and other capital expenditures of the
Borrower and the Subsidiaries that are (or would be) set forth in a statement of
cash flows of the Borrower and its Consolidated Subsidiaries for such period
prepared in accordance with GAAP, excluding capitalized software expenses, and
(b) Capital Lease Obligations incurred by the Borrower and its Consolidated
Subsidiaries during such period (other than any such Capital Lease Obligations
that shall relate to assets acquired in transactions reflected in Capital
Expenditures for any earlier period). For purposes of this definition, (i) the
purchase price of equipment or other fixed assets that are purchased
simultaneously with the trade-in of existing assets or with insurance proceeds
shall be included in Capital Expenditures only to the extent of the gross amount
by which such purchase price exceeds the credit granted by the seller of such
assets for the assets being traded in at such time or the amount of such
insurance proceeds, as the case may be, (ii) acquisitions permitted by Section
6.05(e) shall be excluded and (iii) "Capital Expenditures" in respect of any
period shall be reduced by the amount of Customer Capital Expenditures that are
directly paid by customers during such period and by the amount of
reimbursements the Borrower or any Subsidiary shall have received during such
period from customers in respect of Customer Capital Expenditures; provided that
the aggregate amount of such reductions shall not exceed $50,000,000 in any
fiscal year.
"Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
6
"Change in Control" means (a) the acquisition of ownership, directly
or indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934, as amended, and the rules of the
United States Securities and Exchange Commission thereunder as in effect on the
date hereof), of Equity Interests representing more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding Equity Interests
of the Borrower; or (b) occupation of a majority of the seats (other than vacant
seats) on the board of directors of the Borrower by Persons who were neither (i)
directors on the date hereof or nominated by the board of directors of the
Borrower nor (ii) appointed by directors so nominated.
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
any Issuing Bank (or, for purposes of Section 2.13(b), by any lending office of
such Lender or by such Lender's or such Issuing Bank's holding company, if any)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.
"Chemical Products Division" means those standard business units of
the Borrower and the other Grantors classified as the "Chemical Products
Division" on the Borrower's perpetual inventory records.
"Class" when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans,
Tranche A Term Loans or Tranche B Term Loans and, when used in reference to any
Commitment, refers to whether such Commitment is a Revolving Commitment, a
Tranche A Term Loan Commitment or a Tranche B Term Loan Commitment.
"CLO" means any entity (whether a corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise investing
in bank loans and similar extensions of credit in the ordinary course of its
business and is administered or managed by a Lender or an Affiliate of such
Lender.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" means that portion of the "Collateral", as defined in
the Guarantee and Collateral Agreement, that secures the Obligations.
"Collateral Agent" means JPMCB, in its capacity as collateral agent
for the Lenders under the Guarantee and Collateral Agreement and the other
Security Documents.
"Commitment" means a Revolving Commitment or a Term Loan Commitment,
or any combination thereof (as the context requires).
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"Consent Subsidiary" means (a) any Subsidiary listed on Part I or
Part II of Schedule 1.01 and (b) any Subsidiary not on Schedule 1.01A or formed
or acquired after the Original Effective Date in respect of which (A) the
consent of any Person other than the Borrower or any Wholly Owned Subsidiary is
required by applicable law or the terms of any organizational document of such
Subsidiary or other agreement of such Subsidiary or an Affiliate of such
Subsidiary in order for such Subsidiary to execute the Guarantee and Collateral
Agreement as an ABL Facilities Grantor or a Subsidiary Guarantor and perform its
obligations thereunder, and (B) the Borrower endeavored in good faith to obtain
such consents and such consents shall not have been obtained. Notwithstanding
the foregoing, no Subsidiary shall be a Consent Subsidiary at any time that it
is a guarantor of, or has provided any collateral to secure, Indebtedness for
borrowed money of the Borrower, and any Consent Subsidiary (including a Consent
Subsidiary listed in Part I or Part II of Schedule 1.01) that at any time ceases
to meet the test set forth in clause (A) shall cease to be a Consent Subsidiary.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) Consolidated Interest
Expense for such period, (ii) income tax expense for such period, (iii) all
amounts attributable to depreciation and amortization for such period, (iv) all
non-cash non-recurring charges for such period, (v) all Rationalization Charges
for such period, (vi) other expense for such period, (vii) equity in losses of
affiliates for such period, (viii) foreign exchange currency losses for such
period and (ix) minority interest in net income of subsidiaries for such period,
minus (b) without duplication, to the extent included in determining such
Consolidated Net Income (except with respect to (ii) and (iii) below), (i) any
non-cash extraordinary gains for such period, (ii) cash expenditures (other than
Rationalization Charges) during such period in respect of items that resulted in
non-cash non-recurring charges during any prior period after the date hereof,
(iii) Excess Cash Rationalization Charges, (iv) other income for such period,
(v) equity in earnings of affiliates for such period, (vi) foreign exchange
currency gains for such period and (vii) minority interest in net losses of
subsidiaries for such period, all determined on a consolidated basis in
accordance with GAAP. Each item referred to in this definition and not defined
elsewhere in this Agreement will be computed by a method consistent with that
used in preparing the financial statements referred to in Section 3.04.
"Consolidated Interest Expense" means, for any period, the sum,
without duplication, of (a) the consolidated interest expense (including imputed
interest expense in respect of Capital Lease Obligations and excluding fees and
other origination costs included in interest expense and arising from
Indebtedness incurred at any time) of the Borrower and its Consolidated
Subsidiaries for such period, determined in accordance with GAAP but excluding
capitalized interest, (b) all cash dividends paid during such period in respect
of Permitted Preferred Stock and (c) all finance expense related to
Securitization Transactions, excluding amortization of origination and other
fees.
"Consolidated Net Income" means, for any period, the net income or
loss of the Borrower and its Consolidated Subsidiaries for such period
determined in accordance with GAAP.
8
"Consolidated Net Worth" means, as of the last day of any fiscal
quarter, the sum for the Borrower of (a) the stated value of outstanding common
stock, (b) capital surplus and (c) retained earnings, excluding for purposes of
such calculation the effect of (i) all non-cash non-recurring charges (including
the $84,700,000 of charges incurred in connection with the Borrower's
restatement of its financial statements from 1998 through the second quarter of
2003, reflected in SEC filings made in the fourth quarter of 2003), and all
non-cash Rationalization Charges and (ii) all losses and gains on sales of
assets other than in the ordinary course of business and all other non-cash
non-recurring gains, in each case in (i) and (ii) above after December 31, 2002.
"Consolidated Revenue" means, for any period, the revenues of the
Borrower and its Consolidated Subsidiaries for such period, determined in
accordance with GAAP.
"Consolidated Senior Secured Indebtedness" means, for any period,
the sum for the Borrower and its Consolidated Subsidiaries for such period,
without duplication, of (a) all Indebtedness (other than up to $2,500,000,000
aggregate principal amount of Senior Subordinated-Lien Indebtedness) that is
included on the Borrower's consolidated balance sheet and is secured by any
assets of the Borrower or a Consolidated Subsidiary, (b) all Capital Lease
Obligations and (c) all synthetic lease financings, (d) all Indebtedness of
South Pacific Tyres that is secured by any of its assets or assets of the
Borrower or a Consolidated Subsidiary and (e) all Securitization Transactions,
all determined in accordance with GAAP. For purposes of computing Consolidated
Senior Secured Indebtedness, the amount of any synthetic lease financing shall
equal the amount that would be capitalized in respect of such lease if it were a
Capital Lease Obligation.
"Consolidated Subsidiary" means, at any date, each Subsidiary the
accounts of which would be consolidated with those of the Borrower in the
Borrower's consolidated financial statements in accordance with GAAP.
"Consolidated Total Assets" means, at any date, the total assets of
the Borrower and its Consolidated Subsidiaries, determined in accordance with
GAAP.
"Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Credit Documents" means this Agreement, any promissory notes
delivered pursuant to Section 2.08(e), the Security Documents, the Lien
Subordination and Intercreditor Agreement and, for purposes of Articles III, IV
and VII only, each Borrowing Base Certificate delivered pursuant to Section
5.09.
"Credit Party" means the Borrower, each Subsidiary Guarantor and
each Grantor.
9
"Customer Capital Expenditures" shall mean all or any portion of the
purchase price of equipment or other fixed assets purchased for use in the
business of the Borrower or any Subsidiary that is paid directly, or reimbursed
to the Borrower or any Subsidiary, by customers of the Borrower or any of the
Subsidiaries that are not Affiliates of the Borrower.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Deposit Account" has the meaning assigned to such term in the
Guarantee and Collateral Agreement.
"Deposit Account Institution" has the meaning assigned to such term
in the Guarantee and Collateral Agreement.
"Designated Debt" means Indebtedness of the Borrower that matures
during any of the calendar years 2005, 2006, 2007 and 2008.
"Dilution Factors" means, with respect to any period, the aggregate
amount recorded (in a manner consistent with current and historical accounting
practices of the Borrower) to reduce Eligible Accounts Receivable on account of
deductions, credit memos (net of related re-bills), returns, incorrect ▇▇▇▇▇▇▇▇,
adjustments, allowances, bad debt write-offs and other non-cash credits, in each
case without duplication of any amounts relating to reserves for volume rebates
or cash discounts or any other items that are included in the Accounts
Receivable Reserves for such period or excluded from the value of Eligible
Accounts Receivable pursuant to the definition thereof.
"Dilution Ratio" means, on any date, the amount (expressed as a
percentage) equal to (a) the aggregate amount of the applicable Dilution Factors
for the 12 most recently ended fiscal months divided by (b) total gross sales
for the 12 most recently ended fiscal months.
"Dilution Reserve" means, on any date, (a) the applicable Dilution
Ratio on such date multiplied by (b) (i) Eligible Accounts Receivable on such
date minus (ii) the Accounts Receivable Reserves on such date.
"Disclosure Documents" means (a) the Information Memorandum, (b)
reports of the Borrower on Forms 10-K, 10-Q and 8-K, and any amendments thereto,
that shall have been (i) filed with the Securities and Exchange Commission on or
prior to ▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇ (▇▇) filed with the Securities and Exchange
Commission after such date and prior to the Original Effective Date and
delivered to the Administrative Agent, and (c) the draft Report of the Borrower
on Form 10-K for the fiscal year ended December 31, 2002, delivered to the
Lenders prior to the date hereof, as such Report shall have been modified by any
subsequent draft of such Report delivered to the Administrative Agent prior to
the Original Effective Date.
10
"Documentation Agent" means each of Bank of America, N.A., The CIT
Group/Business Credit, Inc. and General Electric Capital Corporation, in its
capacity as documentation agent hereunder.
"dollars" or "$" refers to lawful money of the United States of
America.
"Domestic Subsidiary" means any Subsidiary that is not a Foreign
Subsidiary.
"Effective Advance Rate" means, on any date, the percentage equal to
the Inventory Advance Amount on such date divided by the Inventory Value of all
Inventory of the Borrower and each other Grantor on such date.
"Eligible Accounts Receivable" means, at the time of any
determination, each Account that satisfies the following criteria at the time of
such determination: such Account (a) has been invoiced to, and represents the
bona fide amounts due to the Borrower or another Grantor from, the purchaser of
goods or services, in each case originated in the ordinary course of business of
the Borrower or such Grantor and (b) is not ineligible for inclusion in the
calculation of the Borrowing Base pursuant to any of clauses (i) through (xxii)
below or otherwise deemed by the Administrative Agent or the Majority Borrowing
Base Lenders in their discretion (not to be exercised unreasonably) to be
ineligible for inclusion in the calculation of the Borrowing Base based on the
results of collateral and borrowing base evaluations and monitoring conducted by
the Administrative Agent and its designated representatives; any such decision
by the Administrative Agent or the Majority Borrowing Base Lenders shall be made
by written notice to the Borrower setting forth in reasonable detail the basis
for such decision, and shall become effective for purposes of the first
Borrowing Base Certificate that is delivered pursuant to Section 5.09 at least
five Business Days after the date of receipt by the Borrower of such written
notice. Without limiting the generality of foregoing, to qualify as Eligible
Accounts Receivable an Account shall indicate no Person other than the Borrower
or another Grantor as payee or remittance party. In determining the amount to be
so included, the face amount of an Account shall be reduced by, without
duplication, to the extent not reflected in such face amount, (a) the amount of
all accrued and actual discounts, claims, credits or credits pending,
promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that the Borrower or another Grantor may be
obligated to rebate to a customer pursuant to the terms of any agreement or
understanding (written or oral)), in each case without duplication of any
amounts that are included in the Accounts Receivable Reserves or the Dilution
Factors for such period, (b) the aggregate amount of all limits and deductions
provided for in this definition and (c) the aggregate amount of all cash
received in respect of such Account but not yet applied by the Borrower or
another Grantor to reduce the amount of such Account. Standards of eligibility
may be fixed from time to time by the Administrative Agent or the Majority
Borrowing Base Lenders in their discretion (not to be exercised unreasonably)
based on the results of collateral and borrowing base evaluations and monitoring
conducted by the Administrative Agent and its designated representatives. Any
changes to such standards by the Administrative Agent or the Majority Borrowing
Base Lenders shall be made by written notice to the Borrower
11
setting forth in reasonable detail the basis for such change, and shall become
effective for purposes of the first Borrowing Base Certificate that is delivered
pursuant to Section 5.09 at least five Business Days after the date of receipt
by the Borrower of such written notice. Unless otherwise approved from time to
time in writing by the Administrative Agent, an Account shall not be an Eligible
Account Receivable (or, in the case of clauses (vii) and (xv) below, the
affected portion of such Account shall be deemed not to be an Eligible Account
Receivable) if, without duplication:
(i) the Borrower or another Grantor does not have good and valid
title to such Account; or
(ii) such Account (x) is unpaid more than 60 days from the original
due date or (y) has been written off the books of the Borrower or another
Grantor or has been otherwise designated on such books as uncollectible;
or
(iii) more than 35% in face amount of all Accounts of the same
Account Debtor (x) are unpaid more than 60 days from the original due date
or (y) have been written off the books of the Borrower or another Grantor
or have been otherwise designated on such books as uncollectible; or
(iv) the Account Debtor is insolvent or the subject of any
bankruptcy case or insolvency proceeding of any kind; or
(v) such Account is not payable in U.S. Dollars and/or Canadian
Dollars, the Account Debtor is not located inside the United States or
Canada, the Account Debtor does not have significant assets inside the
United States or Canada or the enforceability of such Account is not
governed by the laws of the United States or Canada or any of their
respective states, provinces, territories or possessions or any political
subdivision of any thereof; or
(vi) the Account Debtor is the United States of America or Canada or
any department, agency or instrumentality thereof, unless the Borrower or
the other applicable Grantor duly assigns its rights to payment of such
Account to the Administrative Agent pursuant to the Assignment of Claims
Act of 1940, as amended, or the Financial Administration Act (Canada), as
amended, as applicable, which assignment and related documents and filings
shall be in form and substance satisfactory to the Administrative Agent;
or
(vii) to the extent of any security deposit, progress payment,
retainage or other similar advance made by or for the benefit of the
applicable Account Debtor to which such Account is subject; or
(viii) such Account (x) is not subject to a valid and perfected
first priority Lien in favor of the Administrative Agent for the benefit
of the Secured Parties to the extent that such a Lien may be perfected by
filing UCC financing statements or making such other personal property
security filings or registrations as may be required under the laws of the
applicable jurisdiction in which such Account Debtor is located or has its
principal place of business or domicile (for the
12
purposes of the Quebec Civil Code), subject to no other Liens other than
Permitted Encumbrances (other than those described in clause (f) of the
definition thereof) or (y) does not otherwise conform in all material
respects to the applicable representations and warranties contained in the
Credit Documents; or
(ix) (x) such Account was invoiced or payment was received thereon
(A) in advance of goods or services provided or (B) more than once or (y)
the associated income has not been earned; or
(x) such Account is a note receivable, non-trade Account or relates
to payments for rent or interest; or
(xi) the sale to the Account Debtor is on a ▇▇▇▇-and-hold, sale on
approval or consignment (it being understood and agreed that an Account
that arises in connection with a sale of such goods by the consignee
thereof shall not be deemed to be ineligible by reason of this clause
(xi)) or other similar basis or made pursuant to any other agreement
(other than an ordinary course customer warranty) providing for
repurchases or return of any merchandise which has been claimed to be
defective or otherwise unsatisfactory; or
(xii) the goods giving rise to such Account have not been shipped
and title has not been transferred to the Account Debtor or such Account
represents a progress-billing; for purposes hereof, progress-billing means
any invoice for goods sold or leased or services rendered under a contract
or agreement pursuant to which the Account Debtor's obligation to pay such
invoice is conditioned upon the Borrower's or the other applicable
Grantor's completion of any further performance under such contract or
agreement; or
(xiii) such Account arises out of a sale made by the Borrower or
another Grantor to an Affiliate (other than an Eligible Affiliate) of the
Borrower or such Grantor; or
(xiv) such Account was created by the Borrower or another Grantor as
a new receivable for the unpaid portion of an outstanding Account; or
(xv) the Account Debtor (x) is a creditor, (y) has or has asserted a
right of set-off against the Borrower or another Grantor with respect to
such Account (unless such Account Debtor has entered into a written
agreement reasonably acceptable to the Administrative Agent to waive such
set-off rights) or (z) has disputed its liability (whether by chargeback,
dispute or otherwise) or made any asserted or unasserted claim with
respect to such Account or any other Account of the Borrower or such other
Grantor (as applicable) which has not been resolved, in each case, without
duplication, to the extent of the amount owed by the Borrower or such
other Grantor (as applicable) to the Account Debtor, the amount of such
actual or asserted right of set-off or the amount of such dispute or
claim, as the case may be; or
13
(xvi) such Account does not comply in all material respects with the
requirements of all applicable laws and regulations, whether Federal,
State, provincial or local, including the Federal Consumer Credit
Protection Act, the Federal Truth in Lending Act and Regulation Z of the
Board; or
(xvii) such Account is for goods that have been sold under a
purchase order or pursuant to the terms of a contract or other agreement
or understanding (written or oral) that indicates that any Person other
than the Borrower or another Grantor has or has had or has purported to
have or have had an ownership interest in such goods and in the Account
resulting from the sale of such goods; or
(xviii) such Account is an extended terms account, which is not due
and payable within 180 days from the original date of invoice; or
(xix) such Account is created on cash on delivery terms or is
payment for freight claims; or
(xx) to the extent that such Account has been reclassified, as a
result of a workout or other similar situation relating to the credit
worthiness of the applicable Account Debtor, from an account receivable to
a note receivable; or
(xxi) the Account Debtor has not been instructed by the Borrower or
any of the other Grantors to pay such Account directly into a Deposit
Account in the Lockbox System; or
(xxii) such Account relates to the Retail Division or Wingfoot,
unless such Account meets certain criteria and is deemed eligible by the
Administrative Agent in its sole discretion.
Notwithstanding the foregoing, at the time of any determination of
Eligible Accounts Receivable, an amount equal to all Eligible Accounts
Receivable of any single Account Debtor and its Affiliates which in the
aggregate exceed (a) 12% in respect of an Account Debtor whose unsecured short
term debt is rated A3 or better by Moody's or ▇- ▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇'▇,
(▇) 6% in respect of an Account Debtor whose unsecured short term debt does not
have the rating described in clause (a) but are rated Investment Grade by either
Moody's or Standard & Poor's and (c) 3% in respect of any other Account Debtor,
in each case of the total amount of all Eligible Accounts Receivable at such
time of determination shall be deemed not to be Eligible Accounts Receivable to
the extent of such excess. In determining the aggregate amount of Accounts from
the same Account Debtor that are unpaid more than 60 days from the due date
pursuant to clause (ii) above there shall be excluded the amount of any net
credit balances relating to Accounts with invoice dates more than 60 days from
the due date.
"Eligible Affiliate" means any Affiliate of the Borrower, provided
that (a) the Borrower or any of its other Affiliates does not Control such
Affiliate, (b) the Borrower and the Subsidiaries do not own, control or hold,
directly or indirectly, individually or in the aggregate, Equity Interests of
such Affiliate representing 50% or more of the equity or 50% or more of the
voting power or, in the case of a partnership,
14
50% or more of the general partnership interests of such Affiliate, (c) the
accounts of such Affiliate are not consolidated with those of the Borrower in
the Borrower's consolidated financial statements (and are not required to be so
consolidated in accordance with GAAP), (d) each Account due to the Borrower or
another Grantor from such Affiliate requires payment for the goods sold or
leased or the services rendered to such Affiliate in cash and on terms that are
no less favorable to the Borrower or such Grantor, as the case may be, than
those that could be obtained at such time in arm's-length dealings with a Person
who is not such an Affiliate and (e) such Affiliate meets any other eligibility
standard or requirement that is imposed by the Administrative Agent or the
Majority Lenders in their discretion (not to be exercised unreasonably) based on
the results of collateral and borrowing base evaluations and monitoring
conducted by the Administrative Agent and its designated representatives; any
changes to such standards or requirements or the imposition of any additional
standard or requirement by the Administrative Agent or the Majority Lenders
shall be made by written notice to the Borrower setting forth in reasonable
detail the basis for such change or addition, and shall become effective for
purposes of the first Borrowing Base Certificate that is delivered pursuant to
Section 5.09 at least five Business Days after the date of receipt by the
Borrower of such written notice.
"Eligible Finished Goods" means, on any date, the Inventory Value of
all Eligible Inventory of the Borrower and each other Grantor defined as
Finished Goods by the Borrower on such date as shown on the Borrower's perpetual
inventory records in accordance with its current and historical accounting
practices.
"Eligible Inventory" means, at the time of any determination
thereof, without duplication, the Inventory Value of the Inventory of the
Borrower and each other Grantor at the time of such determination that is not
ineligible for inclusion in the calculation of the Borrowing Base pursuant to
any of clauses (a) through (n) below or otherwise deemed by the Administrative
Agent or the Majority Borrowing Base Lenders in their discretion (not to be
exercised unreasonably) to be ineligible for inclusion in the calculation of the
Borrowing Base based on the results of collateral and borrowing base evaluations
and monitoring conducted by the Administrative Agent and its designated
representatives; any such decision by the Administrative Agent or the Majority
Borrowing Base Lenders shall be made by written notice to the Borrower setting
forth in reasonable detail the basis for such decision, and shall become
effective for purposes of the first Borrowing Base Certificate that is delivered
pursuant to Section 5.09 at least five Business Days after the date of receipt
by the Borrower of such written notice. Without limiting the generality of the
foregoing, to qualify as "Eligible Inventory" no Person other than the Borrower
or another Grantor shall have any direct or indirect ownership, interest or
title to such Inventory and no Person other than the Borrower or another Grantor
shall be indicated on any purchase order or invoice with respect to such
Inventory as having or purporting to have an interest therein. Unless otherwise
approved from time to time in writing by the Administrative Agent, no Inventory
shall be deemed Eligible Inventory to the extent that such Inventory is
accounted for in the Borrower's perpetual inventory balance and, without
duplication:
15
(a) it is not owned solely by the Borrower or another Grantor or the
Borrower or another Grantor does not have good and valid title thereto; or
(b) it is not located in the United States or Canada; or
(c) it (i) is not either (x) located on a Permitted Inventory
Location or (y) in transit from a Permitted Inventory Location to another
Permitted Inventory Location or (ii) is located at a dormant facility that
is no longer operated by the Borrower or another Grantor; or
(d) it is (i) goods returned or rejected by the Borrower's or
another Grantor's customers and is not saleable in the ordinary course of
business of the Borrower or another Grantor, (ii) Inventory in transit on
the water via ship or other marine vessel to the Borrower or another
Grantor or (iii) goods in transit from the Borrower or another Grantor to
customers of the Borrower or another Grantor; or
(e) it is Inventory (other than Raw Materials) not sold in the
ordinary course of business of the Borrower or another Grantor, including
engineering stores, miscellaneous supplies, packaging or shipping
materials, cartons, repair parts, fuel, labels, miscellaneous spare parts,
samples, prototypes, displays or display items; or
(f) it is not subject to a valid and perfected first priority Lien
in favor of the Administrative Agent for the benefit of the Secured
Parties to the extent that such a Lien may be perfected by filing UCC
financing statements or such other personal property security filings or
registrations as may be required under the laws of the applicable
jurisdiction in which such Inventory is located, subject to no other Liens
other than Permitted Encumbrances (other than those described in clause
(f) of the definition thereof); or
(g) it is classified by the Borrower or another Grantor as work in
process; or
(h) it is consigned or at a customer location (other than Inventory
consigned to original equipment manufacturers at no more than 20 locations
in total, each of which have Inventory of the Borrower and the other
Grantors with an Inventory Value in excess of $300,000 and with respect to
which, on or after the fifteenth day following the Original Effective
Date, an Access Agreement has been obtained); or
(i) it is (i) being processed offsite at a third party processor at
premises neither reflected in the Rent Reserve nor subject to a Lien
Waiver or (ii) in transit to or from any such third party processor; or
(j) it is classified by the Borrower or another Grantor as
"obsolete", "unmerchantable" or "off spec without a ready market", or does
not otherwise
16
conform in all material respects to the applicable representations and
warranties contained in the Credit Documents; or
(k) it is marked for return by the Borrower or another Grantor to
the vendor of such Inventory; or
(l) it does not meet in all material respects all materials
standards imposed by any Governmental Authority having regulatory
authority over it; or
(m) it is classified by the Borrower or another Grantor as casings
used for the retreading of commercial truck tires; or
(n) it is classified by the Borrower or another Grantor as "shipped
but not billed".
"Eligible Raw Materials" means, on any date, the Inventory Value of
all Eligible Inventory of the Borrower and each Grantor defined as Raw Materials
on such date as shown on the Borrower's perpetual inventory records in
accordance with its current and historical accounting practices.
"Engineered Products Division" means those standard business units
of the Borrower and the other Grantors classified as "Engineered Products
Division" on the Borrower's perpetual inventory records.
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the presence, the management or release of, or exposure to, any
Hazardous Materials or to health and safety matters.
"Environmental Liability" means all liabilities, obligations,
damages, losses, claims, actions, suits, judgments, orders, fines, penalties,
fees, expenses and costs (including administrative oversight costs, natural
resource damages and remediation costs), whether contingent or otherwise,
arising out of or relating to (a) compliance or non-compliance with any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release of any Hazardous Materials or (e) any contract,
agreement or other consensual arrangement pursuant to which liability is assumed
or imposed with respect to any of the foregoing.
"Equity Interests" means shares of capital stock, partnership
interests, membership interests in limited liability companies, beneficial
interests in trusts or other equity ownership interests in any Persons, and any
warrants, options or other rights entitling the holders thereof to purchase or
acquire any such equity interests.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
17
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower or any Subsidiary, is treated as
a single employer under Section 414(b) or (c) of the Code or, solely for
purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to any
Plan (other than an event for which the 30-day notice period is waived or an
event described in Section 4043.33 of Title 29 of the Code of Federal
Regulations); (b) the existence with respect to any Plan of an "accumulated
funding deficiency" (as defined in Section 412 of the Code or Section 302 of
ERISA) as to which a waiver has not been obtained; (c) the incurrence by the
Borrower, a Subsidiary or any ERISA Affiliate of any liability under Title IV of
ERISA with respect to the termination of any Plan; (d) the treatment of a Plan
amendment as a termination under Section 4041 of ERISA; (e) any event or
condition, other than the Transactions, that would be materially likely to
result in the termination of, or the appointment of a trustee to administer, any
Plan or Multiemployer Plan under Section 4042 of ERISA; (f) the receipt by the
Borrower, a Subsidiary or any ERISA Affiliate from the PBGC or a plan
administrator of any notice of an intention to terminate any Plan or to appoint
a trustee to administer any Plan; (g) the incurrence by the Borrower, any
Subsidiary or any ERISA Affiliate of any liability under Title IV of ERISA with
respect to the withdrawal or partial withdrawal from any Plan or Multiemployer
Plan; or (h) the receipt by the Borrower, any Subsidiary or any ERISA Affiliate
of any notice, or the receipt by any Multiemployer Plan from the Borrower, any
Subsidiary or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"European Facilities Agreement" means the $650,000,000 Term Loan and
Revolving Credit Agreement dated as of the date hereof among the European JV,
the other borrowers thereunder, certain lenders and JPMCB, as administrative
agent.
"European JV" means Goodyear Dunlop Tires Europe B.V.
"Event of Default" has the meaning assigned to such term in Article
VII.
"Excess Cash Rationalization Charges" means, for any period, cash
expenditures of the Borrower and its Consolidated Subsidiaries in such period
with respect to Rationalization Charges recorded on the Borrower's consolidated
income statement after the date hereof; provided, however that for such cash
expenditures incurred after September 1, 2003, Excess Cash Rationalization
Charges shall only include the aggregate amount of such cash expenditures which
exceed the sum of $100,000,000 (or $50,000,000 if incurred prior to December 31,
2003) plus 25% of Net Cash Proceeds
18
from the issuance and sale of its Equity Interests or Indebtedness pursuant to
Section 6.01(q).
"Excluded Operating Account" means payroll and other operating
accounts of the Borrower or any other Grantor that are not used to receive (a)
payments from any Account Debtor in respect of Accounts or (b) payments in
respect of Inventory, and containing only such amounts as required in the
Borrower's or such other Grantor's good faith judgment for near-term operational
purposes.
"Excluded Subsidiary" means any Subsidiary with only nominal assets
and no operations.
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender, any Issuing Bank or any other recipient of any payment to be made by
or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
or by the jurisdiction under the laws of which such recipient is organized or in
which its principal office is located or, in the case of any Lender, in which
its applicable lending office is located, (b) any branch profits taxes imposed
by the United States or any similar tax imposed by any other jurisdiction
described in clause (a) above and (c) (i) any withholding tax that is imposed by
the United States on amounts payable to a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.17(b)) at the time such
Foreign Lender first becomes a party to this Agreement (or designates a new
lending office), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office (or
assignment), to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 2.15(a) or (ii) any withholding tax
that is imposed by the United States on amounts payable to a Foreign Lender that
is attributable to such Foreign Lender's failure to comply with Section 2.15(e).
"Existing Securitization Facilities" means (a) the securitization
facility made available pursuant to the Series ▇▇▇▇-▇ ▇▇▇▇▇▇▇▇▇ Supplement dated
as of April 27, 2001 to the Base Indenture dated as of April 27, 2001 among
Wingfoot A/R LLC, as issuer, The Goodyear Tire & Rubber Company, as collection
agent, The Chase Manhattan Bank, as administrative agent, certain CP Conduit
Purchasers, certain APA Banks, certain Funding Agents and The Chase Manhattan
Bank, as indenture trustee and (b) the securitization facility made available
pursuant to the Receivables Purchase Agreement dated July 27, 2001 between
Goodyear Canada Inc., as seller and initial servicer, Montreal Trust Company, as
trustee of Bay Street Funding Trust, as issuer, and Scotia Capital Inc., as
administrator.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of
19
the quotations for such day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or any assistant treasurer of the Borrower.
"Finished Goods" means completed goods that require no additional
processing or manufacturing to be sold by the Borrower or another Grantor in the
ordinary course of business.
"First Amendment" means the First Amendment dated as of February 19,
2004, to the Original Credit Agreement, amending and restating such the Original
Credit Agreement in the form of this Agreement.
"First Amendment Date" means February 19, 2004.
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For purposes
of this definition, the United States, each State thereof and the District of
Columbia shall be deemed to constitute a single jurisdiction.
"Foreign Subsidiary" means any Subsidiary organized under the laws
of a jurisdiction other than the United States or any of its territories or
possessions or any political subdivision thereof.
"GAAP" means generally accepted accounting principles in the United
States.
"Governmental Authority" means the government of the United States,
Canada, any other nation or any political subdivision thereof, whether state,
provincial or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Grantors" means the Borrower and each North American Subsidiary
that has become, or is required to become, an ABL Facilities Grantor (as defined
in the Guarantee and Collateral Agreement) and, if applicable, a party to any
Canadian Security Agreement pursuant to Section 4.01(j) of the Original Credit
Agreement or Section 5.08 hereof.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and including
any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness of the
20
payment thereof, (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness; provided, that the term Guarantee shall not include endorsements
for collection or deposit in the ordinary course of business. The amount of any
Guarantee of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee is made and (b) the maximum amount for which
such guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee, unless such primary obligation and the maximum amount
for which such guaranteeing person may be liable are not stated or determinable,
in which case the amount of such Guarantee shall be such guaranteeing person's
maximum reasonably anticipated liability (assuming such person is required to
perform) in respect thereof as determined in such person's good faith.
"Guarantee and Collateral Agreement" means the Master Guarantee and
Collateral Agreement among the Borrower, the Subsidiary Guarantors, the
Grantors, certain other Subsidiaries and the Collateral Agent substantially in
the form of Exhibit G.
"Hazardous Materials" means (a) petroleum products and byproducts,
asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, radon
gas, chlorofluorocarbons and all other ozone-depleting substances; and (b) any
pollutant or contaminant or any hazardous, toxic, radioactive or otherwise
regulated chemical, material, substance or waste that is prohibited, limited or
regulated pursuant to any applicable Environmental Law.
"Improved Ratings Day" means a day on which (a) Moody's has in
effect a rating for the Tranche B Term Loans of B1 or better and (b) Standard &
Poor's has in effect a rating for the Tranche B Term Loans of B+ or better.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (d) all obligations of
such Person in respect of the deferred purchase price of property or services
(excluding accounts payable incurred in the ordinary course of business), (e)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right to be secured by) any Lien on property owned
or acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (f) all Guarantees by such Person of Indebtedness of others, (g)
all Capital Lease Obligations of such Person, (h) all obligations, contingent or
otherwise, of such Person as an account party in respect of letters of credit
and letters of guaranty and (i) all Securitization Transactions of such Person.
The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is liable therefor as a result of such Person's ownership
interest in such entity.
21
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indemnitee" has the meaning set forth in Section 9.03.
"Information" has the meaning set forth in Section 9.12.
"Information Memorandum" means the Confidential Information
Memorandum dated March 5, 2003 relating to the Borrower and the Transactions.
"Interest Election Request" means a request by the Borrower to
convert or continue a Revolving Borrowing or Term Borrowing in accordance with
Section 2.06 in substantially the form of Exhibit B hereto.
"Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar Borrowing with an
Interest Period of more than three months' duration, each day prior to the last
day of such Interest Period that occurs at intervals of three months' duration
after the first day of such Interest Period.
"Interest Period" means, with respect to any Eurodollar Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter, as the Borrower may elect; provided that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period pertaining to a Eurodollar Borrowing that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period. For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and, in the case of a Borrowing, thereafter shall be the
effective date of the most recent conversion or continuation of such Borrowing.
"Inventory" has the meaning specified in the UCC.
"Inventory Reserves" means, on any date, an amount equal to the sum
of the following reserves maintained on the Borrower's general ledger
(calculated in each case in accordance with the current and historical
accounting practices of the Borrower) with respect to Eligible Inventory,
without duplication of any deductions made pursuant to the definitions of
"Additional Inventory Reserves," "Eligible Inventory" and "Inventory Value":
(a) a reserve for Inventory that is damaged;
22
(b) a revaluation reserve to reflect capitalized manufacturing
variances whereby aggregate net variances (if favorable) shall be deducted
from Eligible Inventory and aggregate net variances (if unfavorable) shall
not be added to Eligible Inventory;
(c) a reserve equal to the aggregate Inventory Value of Eligible
Inventory attributable to intercompany or intracompany profit among the
Borrower and its Affiliates (other than Eligible Affiliates); and
(d) a lower of cost or market reserve for any differences between
the Borrower's actual cost to produce versus the Borrower's sale price to
third parties, determined on a product line basis.
"Inventory Value" means, with respect to any Inventory of the
Borrower or any other Grantor at the time of any determination thereof, an
amount equal to such Inventory carried on the perpetual inventory records of the
Borrower stated on a basis consistent with its current and historical accounting
practices, in U.S. Dollars, determined in accordance with the standard cost
method of accounting, which shall be, in the case of Inventory imported by the
Borrower or another Grantor into the United States of America or Canada, the
acquisition cost thereof plus transportation and freight charges plus import
duties.
"Investment Grade" means, in the case of Moody's, a credit rating of
Baa3 or better and, in the case of Standard & Poor's, a credit rating of BBB- or
better.
"Investments" has the meaning assigned to such term in Section 6.05.
"Issuing Bank" means JPMCB and each other Lender that has entered
into an Issuing Bank Agreement, each in its capacity as the issuer of Letters of
Credit hereunder, and its successors in such capacity as provided in Section
2.05(i). Each Issuing Bank may, in its discretion, arrange for one or more
Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case
the term "Issuing Bank" shall include any such Affiliate with respect to Letters
of Credit issued by such Affiliate. Notwithstanding the foregoing provisions of
this definition or any other provision of this Agreement, any financial
institution that is an Issuing Bank under and as defined in the US Revolving
Facility Agreement and is not a Lender hereunder may, in connection with the
redesignation of any letter of credit issued by it under such agreement as a
Letter of Credit hereunder as provided in Section 2.04, become a party to this
Agreement and an Issuing Bank hereunder by executing an instrument satisfactory
to the Borrower and the Administrative Agent for the limited purpose of
obtaining the rights and assuming the responsibilities of an Issuing Bank with
respect to such Letter of Credit, but shall not issue any other Letters of
Credit hereunder.
"Issuing Bank Agreement" means an agreement in form reasonably
satisfactory to the Borrower and the Administrative Agent pursuant to which a
Lender agrees to act as an Issuing Bank.
"JPMCB" means JPMorgan Chase Bank, and its successors.
23
"Junior Securities" means, collectively, any Senior
Subordinated-Lien Indebtedness and any Indebtedness or preferred Equity
Interests issued under Section 6.01(q).
"LC Disbursement" means a payment made by any Issuing Bank pursuant
to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption.
"Letter of Credit" means any letter of credit issued pursuant to
this Agreement or any letter of credit issued under the US Revolving Facility
Agreement that has been redesignated as a Letter of Credit hereunder.
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason with respect to any Eurodollar Borrowing,
then the "LIBO Rate" with respect to such Eurodollar Borrowing for such Interest
Period shall be the rate (rounded upwards, if necessary, to the next 1/100 of
1%) at which dollar deposits of $5,000,000 and for a maturity comparable to such
Interest Period are offered by the principal London office of the Administrative
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, French delegation of claims, lien, pledge, hypothecation, encumbrance,
charge or security interest in, on or of such asset, (b) the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title
retention agreement (or any financing lease having substantially the same
economic effect as any of the foregoing) relating to such asset and (c) in the
case of securities, any purchase option, call or similar right of a third party
with respect to such securities.
24
"Lien Subordination and Intercreditor Agreement" means a Lien
Subordination and Intercreditor Agreement, to be dated on or about the first
date on which Senior Subordinated-Lien Indebtedness is incurred, issued or sold,
among the Collateral Agent, the applicable Senior Subordinated-Lien Collateral
Agent, the Borrower and the Subsidiary Guarantors, in substantially the form of
the draft made available to the Lenders prior to the First Amendment Date with
such changes as shall have been approved by the Administrative Agent.
"Lien Waiver" means a written waiver of statutory or contractual
Liens on Inventory for unpaid rent or charges of a warehouseman or bailee in
form and substance reasonably satisfactory to the Administrative Agent.
"Loans" means the loans made by the Lenders to the Borrower pursuant
to this Agreement.
"Lockbox Agreements" has the meaning assigned to such term in the
Guarantee and Collateral Agreement.
"Lockbox System" has the meaning assigned to such term in the
Guarantee and Collateral Agreement.
"Luxembourg Finance" means Goodyear Finance Holding S.A., a
corporation organized in Luxembourg.
"Majority Borrowing Base Lenders" means, at any time, Lenders having
aggregate Revolving Credit Exposures, Tranche A Term Loans and unused Revolving
Commitments representing at least a majority of the sum of the total Revolving
Credit Exposures, Tranche A Term Loans and unused Revolving Commitments at such
time.
"Majority Lenders" means, at any time, Lenders having aggregate
Revolving Credit Exposures, Term Loans and unused Commitments representing at
least a majority of the sum of the total Revolving Credit Exposures, Term Loans
and unused Commitments at such time.
"Material Adverse Change" means a material adverse change in or
effect on (a) the business, operations, properties, assets or financial
condition (including as a result of the effects of any contingent liabilities
thereon) of the Borrower and the Subsidiaries, taken as a whole, (b) the ability
of the Credit Parties, taken as a whole, to perform obligations under this
Agreement and the other Credit Documents that are material to the rights or
interests of the Lenders or (c) the rights of or benefits available to the
Lenders under this Agreement and the other Credit Documents that are material to
the interests of the Lenders.
"Material Indebtedness" means Indebtedness (other than the Loans),
or obligations in respect of one or more Swap Agreements, of any one or more of
the Borrower and the Subsidiaries in an aggregate principal amount exceeding
$25,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of the Borrower or any Subsidiary in respect of any
Swap Agreement at any
25
time shall be the maximum aggregate amount (giving effect to any netting
agreements) that the Borrower or such Subsidiary would be required to pay if
such Swap Agreement were terminated at such time, calculated in accordance with
the terms of such Swap Agreement.
"Material Subsidiary" means, at any time, each Subsidiary other than
Subsidiaries that do not represent more than 1% for any such individual
Subsidiary, or more than 5% in the aggregate for all such Subsidiaries, of
either (a) Consolidated Total Assets or (b) Consolidated Revenue for the period
of four fiscal quarters most recently ended.
"Material Trademarks" has the meaning assigned to such term in the
Guarantee and Collateral Agreement.
"Maturity Date" means March 31, 2006.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any successor
thereto.
"Mortgage" means a mortgage or deed of trust, assignment of leases
and rents, or other security documents reasonably satisfactory in form and
substance to the Collateral Agent granting a Lien on any Mortgaged Property to
secure the Obligations.
"Mortgaged Property" has the meaning assigned to such term in the US
Revolving Facility Agreement.
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"NAIC" means the National Association of Insurance Commissioners.
"Net Cash Proceeds" shall have the meaning assigned to such term in
the US Term Facility Agreement; provided, that the Net Cash Proceeds of any
event that is not a Prepayment Event shall be determined as if such event were a
Prepayment Event.
"New Facilities Credit Agreements" means this Agreement, the US
Revolving Facility Agreement, the US Term Facility Agreement and the European
Facilities Agreement.
"New Facilities Documents" means the New Facilities Credit
Agreements, the Guarantee and Collateral Agreement and the other Security
Documents (as such term is defined in any New Facilities Credit Agreement).
"North American Subsidiary" means any Subsidiary organized under the
laws of the United States or Canada or any of their respective states,
provinces, territories or possessions or any political subdivision of any
thereof.
26
"North American Tire Division" means those standard business units
of the Borrower and the other Grantors classified as "North American Tire
Division" on the Borrower's perpetual inventory records.
"Obligations" means (a) the due and punctual payment of (i) the
principal of and interest (including interest accruing during the pendency of
any bankruptcy, insolvency, receivership or other similar proceeding, regardless
of whether allowed or allowable in such proceeding) on the Loans, when and as
due, whether at maturity, by acceleration, upon one or more dates set for
prepayment or otherwise, (ii) each payment required to be made under this
Agreement in respect of any Letter of Credit, when and as due, including
payments in respect of reimbursements of LC Disbursements and interest thereon
and (iii) all other monetary obligations of the Credit Parties to any of the
Secured Parties under this Agreement and each of the other Credit Documents,
including fees, costs, expenses and indemnities, whether primary, secondary,
direct, contingent, fixed or otherwise (including monetary obligations incurred
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding), and
(b) the due and punctual performance of all other obligations of the Credit
Parties to any of the Secured Parties under this Agreement and the other Credit
Documents.
"Original Effective Date" means April 1, 2003.
"Other Taxes" means any and all present or future stamp,
documentary, excise, recording, transfer, sales, property or similar taxes,
charges or levies arising from any payment made under any Credit Document or
from the execution, delivery or enforcement of, or otherwise with respect to,
any Credit Document.
"Participant" has the meaning assigned to such term in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"Perfection Certificate" means a certificate in the form of Exhibit
II to the Guarantee and Collateral Agreement or any other form approved by the
Collateral Agent.
"Permitted Encumbrances" means:
(a) (i) Liens imposed by law for taxes that are not yet due or are
being contested and (ii) deemed trusts and Liens to which the Priority
Payables Reserve relates for taxes, assessments or other charges or levies
that are not yet due and payable;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 30
days (or any longer grace period available under the terms of the
applicable underlying obligation) or are being contested;
27
(c) Liens created and pledges and deposits made (including cash
deposits to secure obligations in respect of letters of credit provided)
in the ordinary course of business in compliance with workers'
compensation, unemployment insurance and other social security laws or
regulations;
(d) Liens created and deposits made to secure the performance of
bids, trade contracts, leases, statutory obligations, appeal bonds,
performance bonds and other obligations of a like nature, in each case in
the ordinary course of business, and Liens created and deposits made prior
to the date hereof in the ordinary course of business to secure the
performance of surety bonds;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default;
(f) supplier's liens in inventory, other assets supplied or accounts
receivable that result from retention of title or extended retention of
title arrangements arising in connection with purchases of goods in the
ordinary course of business; and
(g) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property and other Liens incidental to the conduct of
business or ownership of property that arise automatically by operation of
law or arise in the ordinary course of business and that do not materially
detract from the value of the property of the Borrower and the
Subsidiaries or of the Collateral, in each case taken as a whole, or
materially interfere with the ordinary conduct of business of the Borrower
and the Subsidiaries, taken as a whole, or otherwise adversely affect in
any material respect the rights or interests of the Lenders;
provided that (except as provided in clause (d) above) the term "Permitted
Encumbrances" shall not include any Lien securing Indebtedness for borrowed
money.
"Permitted Inventory Location" means (a) property owned or leased by
the Borrower or a Grantor in the United States of America or Canada or (b) a
third party warehouse or dock in the United States of America or Canada where
Inventory of the Borrower or any Grantor is stored.
"Permitted Investments" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States (or
by any agency thereof to the extent such obligations are backed by the
full faith and credit of the United States), in each case maturing within
one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from
the date of acquisition thereof and having, at such date of acquisition,
ratings of A1 from Standard & Poor's and P1 from Moody's;
28
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof and issued or guaranteed by or placed with, and money
market deposit accounts issued or offered by any commercial bank organized
under the laws of the United States or any State thereof which has a short
term deposit rating of A1 from Standard & Poor's and P1 from Moody's and
has a combined capital and surplus and undivided profits of not less than
$500,000,000;
(d) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and entered
into with a financial institution described in clause (c) above;
(e) money market funds that (i) comply with the criteria set forth
in Securities and Exchange Commission Rule 2a-7 under the Investment
Company Act of 1940, (ii) are rated AAA by Standard & Poor's and Aaa by
Moody's and (iii) have portfolio assets of at least $5,000,000,000; and
(f) in the case of any Subsidiary that is not a Domestic Subsidiary,
(i) marketable direct obligations issued or unconditionally guaranteed by
the sovereign nation in which such Subsidiary is organized and is
conducting business or issued by any agency of such sovereign nation and
backed by the full faith and credit of such sovereign nation, in each case
maturing within one year from the date of acquisition, so long as the
indebtedness of such sovereign nation is rated at least A by Standard &
Poor's or A2 by Moody's or carries an equivalent rating from a comparable
foreign rating agency, (ii) investments of the type and maturity described
in clauses (b) through (e) of foreign obligors, which investments or
obligors have ratings described in such clauses or equivalent ratings from
comparable foreign rating agencies, (iii) investments of the type and
maturity described in clause (c) in any obligor organized under the laws
of a jurisdiction other than the United States that (A) is a branch or
subsidiary of a Lender or the ultimate parent company of a Lender under
one of the New Facilities Credit Agreements (but only if such Lender meets
the ratings and capital, surplus and undivided profits requirements of
such clause (c)) or (B) carries a rating at least equivalent to the rating
of the sovereign nation in which it is located, and (iv) other investments
of the type and maturity described in clause (c) in obligors organized
under the laws of a jurisdiction other than the United States in any
country in which such Subsidiary is located; provided, that the
investments permitted under this subclause (iv) shall not exceed
$10,000,000 for all such Subsidiaries in any such country or $50,000,000
in the aggregate for all such Subsidiaries and all countries.
"Permitted Preferred Stock" has the meaning assigned to such term in
Section 6.01(q).
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
29
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV or Section 302 of
ERISA or Section 412 of the Code, and in respect of which the Borrower, any
Subsidiary or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an "employer" as defined in Section
3(5) of ERISA.
"Prepayment Event" shall have the meaning assigned to such term in
the US Term Facility Agreement.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by JPMCB (or any successor Administrative Agent appointed or
chosen pursuant to Article VIII hereof) as its prime rate in effect at its
principal office in New York City. Each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Principal Issuing Bank" means JPMCB and any other Issuing Bank whom
the Borrower and JPMCB agree will be a Principal Issuing Bank (or any of their
Affiliates that shall act as Issuing Banks hereunder).
"Priority Payables Reserve" means, at any time, the sum of, without
duplication of any deductions made pursuant to the definitions of "Additional
Inventory Reserves", "Inventory Reserves", "Eligible Inventory" and "Inventory
Value", the full amount of the liabilities at such time which have a trust
imposed to provide for payment thereof or a security interest, Lien or charge
ranking or capable of ranking, in each case senior to or pari passu with the
Liens created under the Security Documents under Canadian federal, provincial,
county, municipal or local law with respect to claims for goods and services
taxes, sales tax, income tax, workers' compensation obligations, vacation pay or
pension fund obligations.
"Rationalization Charges" means, for any period, cash and non-cash
charges related to rationalization actions designed to reduce capacity,
eliminate redundancies and reduce costs. Rationalization Charges will be
computed by a method consistent with that used in preparing the financial
statements referred to in Section 3.04.
"Raw Material" means Inventory used or consumed in the manufacturing
of goods to be sold by the Borrower or another Grantor in the ordinary course of
business.
"Recovery Rate" means (a) the estimated net recovery of all
Inventory of the Borrower and the other Grantors stated in U.S. Dollars as
determined on a net orderly liquidation basis by the most recent analysis
conducted by outside inventory consultants/appraisers retained or approved by
the Administrative Agent and disclosed to the Borrower divided by (b) the
Inventory Value of all Inventory of the Borrower and each other Grantor as of
the date of such most recent analysis.
"Register" has the meaning set forth in Section 9.04.
30
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents,
counsel and other advisors of such Person and such Person's Affiliates.
"Rent Reserve" means, on any date, with respect to any retail store,
distribution center, warehouse, manufacturing facility or other Permitted
Inventory Location where any Eligible Inventory that is subject to Liens arising
by operation of law is located and with respect to which no Lien Waiver is in
effect, a reserve equal to three months' rent and charges at such retail store,
distribution center, warehouse, manufacturing facility or other Permitted
Inventory Location.
"Restatement Effective Date" means the date on which the conditions
specified in Section 6 of the First Amendment are satisfied.
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interests in the Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property) on account of the purchase, redemption,
retirement, acquisition, cancelation or termination of any such Equity Interests
or any option, warrant or other right to acquire any such Equity Interests.
"Retail Division" means those standard business units of the
Borrower and the other Grantors classified as "Retail Division" on the
Borrower's perpetual inventory records.
"Revolving Availability Period" means the period from and including
the Original Effective Date to but excluding the earlier of (a) the Maturity
Date and (b) the date of termination of the Revolving Commitments.
"Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender to make Revolving Loans and to acquire participations
in Letters of Credit hereunder, expressed as an amount representing the maximum
permitted aggregate amount of such Lender's Revolving Credit Exposure hereunder,
as such commitment may be (a) reduced or increased from time to time pursuant to
Section 2.07 and (b) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 9.04. The initial amount of
each Lender's Revolving Commitment is set forth on Schedule 2.01 or in the
Assignment and Assumption pursuant to which such Lender shall have assumed its
Revolving Commitment, as applicable. The initial aggregate amount of the
Lenders' Revolving Commitments is $500,000,000.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and such Lender's LC Exposure at such time.
"Revolving Lender" means a Lender with a Revolving Commitment or, if
the Revolving Commitments have terminated or expired, a Lender with Revolving
Credit Exposure.
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"Revolving Loan" means a Loan made pursuant to clause (iii) of
Section 2.01(a).
"Revolving Obligations" means (a) the due and punctual payment of
(i) the principal of and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Revolving Loans, when and as due, whether at maturity, by acceleration, upon
one or more dates set for prepayment or otherwise and (ii) all other monetary
obligations of the Credit Parties to any of the Revolving Lenders under this
Agreement and each of the other Credit Documents, including fees, costs,
expenses and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding), and (b) the due and punctual
performance of all other obligations of the Credit Parties to any of the
Revolving Lenders under this Agreement and the other Credit Documents.
"Sale and Leaseback Transaction" means any arrangement whereby the
Borrower or a Subsidiary shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereinafter acquired, and
thereafter rent or lease from the buyer or transferee property that it intends
to use for substantially the same purpose or purposes as the property sold or
transferred, other than any such transaction entered into with respect to any
property or any improvements thereto at the time of, or within 180 days after,
the acquisition or completion of construction of such property or such
improvements (or, if later, the commencement of commercial operation of any such
property), as the case may be, to finance the cost of such property or such
improvements, as the case may be.
"Secured Parties" means the Administrative Agent, each Issuing Bank,
the Collateral Agent and each Lender.
"Securitization Transaction" means, with respect to any Person, (i)
any transfer by such Person of accounts receivable, rights to future lease
payments or residuals or other financial assets, and related property, or
interests therein (a) to a trust, partnership, corporation or other entity,
which transfer is funded in whole or in part, directly or indirectly, by the
incurrence or issuance by the transferee or any successor transferee of
Indebtedness or securities that are to receive payments from, or that represent
interests in, the cash flow derived from such accounts receivable or interests,
or (b) directly to one or more investors or other purchasers, (ii) any
Indebtedness of such Person secured substantially entirely by accounts
receivable, rights to future lease payments or residuals or other financial
assets, and related property or (iii) any factoring transaction involving
substantially entirely accounts receivable, rights to future lease payments or
residuals or other financial assets, and related property; provided that
"Securitization Transaction" shall not include (A) the sale by any Foreign
Subsidiary, in the ordinary course of its business, of drafts with a bank or
other financial institution as the maker (or otherwise primarily responsible for
the payment thereof), bankers acceptances or similar instruments received by
such Foreign Subsidiary from a customer
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operating in a jurisdiction other than the United States or any of its
territories or possessions or any political subdivision thereof in satisfaction
of accounts receivable or otherwise as consideration for goods sold or services
provided to such customer or (B) the sale, in the ordinary course of business,
of drafts not payable on demand received by the Borrower or any Subsidiary from
a customer in satisfaction of accounts receivable or otherwise as consideration
for goods sold or services provided to such customer pursuant to an arrangement
(1) initiated by and entered into a the request of such customer, and (2) under
which a financial institution has agreed as part of a financing program
established for and at the request of such customer to buy such drafts from such
customer's vendors (which arrangements may be modified by the Borrower or any
Subsidiary to contemplate the repurchase of such drafts by such customer, or
other actions by such customer to reinstate or to pay receivables in respect of
which such drafts were created, in the event of any failure by such financial
institution to buy such drafts). The amount of any Securitization Transaction
shall be deemed at any time to be the aggregate outstanding principal amount of
the Indebtedness or securities referred to in the preceding sentence or, if
there shall be no such principal amount, the equivalent outstanding amount of
the funded investment.
"Security Documents" means the Guarantee and Collateral Agreement,
the Canadian Security Agreements, the Mortgages and each other instrument or
document delivered in connection with the cash collateralization of Letters of
Credit or pursuant to Section 5.08, in each case to secure any of the
Obligations.
"Senior Subordinated-Lien Collateral Agent" means, as to any Senior
Subordinated-Lien Indebtedness, the collateral agent under the applicable Senior
Subordinated-Lien Indebtedness Security Documents.
"Senior Subordinated-Lien Governing Documents" means each Indenture
or other agreement or instrument providing for the issuance or setting forth the
terms of any Senior Subordinated-Lien Indebtedness.
"Senior Subordinated-Lien Indebtedness" means Indebtedness of the
Borrower issued after the First Amendment Date that (a) is secured by Liens
permitted under Section 6.02(m), but that is not secured by Liens on any
additional assets, (b) constitutes Initial Junior Indebtedness or Designated
Junior Obligations under and as defined in the Lien Subordination and
Intercreditor Agreement, and the Liens securing which are subordinated under the
Lien Subordination and Intercreditor Agreement to the Liens securing the
Obligations and (c) does not contain provisions inconsistent with the
restrictions of Annex A to the First Amendment.
"Senior Subordinated-Lien Obligations" means, as to any Senior
Subordinated-Lien Indebtedness, (a) the principal of and all premium or
make-whole amounts, if any, and interest payable in respect of such Senior
Subordinated-Lien Indebtedness, (b) any amounts payable under Guarantees of such
Senior Subordinated-Lien Indebtedness by Subsidiaries and (c) all other amounts
payable by the Borrower or any Subsidiary under such Senior Subordinated-Lien
Indebtedness, the applicable Senior Subordinated-Lien Security Documents (to the
extent such amounts relate to such Senior
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Subordinated-Lien Indebtedness) or the applicable Senior Subordinated-Lien
Governing Documents.
"Senior Subordinated-Lien Security Documents" means, as to any
Senior Subordinated-Lien Indebtedness, the security agreements, pledge
agreements, mortgages and other documents creating Liens on assets of the
Borrower and the Subsidiary Guarantors to secure the applicable Senior
Subordinated-Lien Obligations.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor thereto.
"Statutory Reserve Rate" means a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject, with
respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which are consolidated with those of the parent in
the parent's consolidated financial statements in accordance with GAAP as of
such date, as well as any other corporation, limited liability company,
partnership, association or other entity of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held by
the parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Borrower.
"Subsidiary Guarantor" means any Subsidiary that has become, or is
required to become, a US Guarantor (as defined in the Guarantee and Collateral
Agreement) pursuant to Section 4.01(j) of the Original Credit Agreement or
Section 5.08 hereof.
"Swap Agreement" means any agreement, including any master
agreement, with respect to any swap, forward, future or derivative transaction
or option or similar agreement involving, or settled by reference to, one or
more rates or prices for one or more currencies, commodities, equity or debt
instruments or securities, or
34
economic, financial or pricing indices or measures of economic, financial or
pricing risk or value or any similar transaction or any combination of these
transactions.
"Syndication Agent" means Citicorp USA, Inc., in its capacity as
syndication agent hereunder.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Borrowing" means a Tranche A Term Borrowing or a Tranche B
Term Borrowing.
"Term Lender" means a Tranche A Term Lender or a Tranche B Term
Lender.
"Term Loans" means Tranche A Term Loans and Tranche B Term Loans.
"Term Loan Commitment" means a Tranche A Term Loan Commitment or a
Tranche B Term Loan Commitment.
"Tranche A Term Lender" means a Lender with an outstanding Tranche A
Term Loan.
"Tranche A Term Loan" means a Loan made pursuant to clause (i) of
Section 2.01(a).
"Tranche A Term Loan Commitment" means, with respect to each Tranche
A Term Lender, the commitment pursuant to which such Lender made its Tranche A
Term Loan hereunder on the Original Effective Date. The aggregate amount of the
Lenders' Tranche A Term Loan Commitments was $800,000,000.
"Tranche A Term Obligations" means (a) the due and punctual payment
of (i) the principal of and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Tranche A Term Loans, when and as due, whether at maturity, by acceleration,
upon one or more dates set for prepayment or otherwise and (ii) all other
monetary obligations of the Credit Parties to any of the Tranche A Term Lenders
under this Agreement and each of the other Credit Documents, including fees,
costs, expenses and indemnities, whether primary, secondary, direct, contingent,
fixed or otherwise (including monetary obligations incurred during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), and (b) the due
and punctual performance of all other obligations of the Credit Parties to any
of the Tranche A Term Lenders under this Agreement and the other Credit
Documents.
"Tranche B Term Lender" means a Lender with a Tranche B Term Loan
Commitment or an outstanding Tranche B Term Loan.
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"Tranche B Term Loan" means a Loan made pursuant to clause (ii) of
Section 2.01(a).
"Tranche B Term Loan Commitment" means, with respect to each Tranche
B Term Lender, the commitment of such Lender to make a Tranche B Term Loan
hereunder on the Restatement Effective Date, expressed as an amount representing
the maximum principal amount of the Tranche B Term Loan to be made by such
Lender hereunder, as such commitment may be (a) reduced or increased from time
to time pursuant to Section 2.07 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04. The
initial amount of each Tranche B Term Lender's Tranche B Term Loan Commitment is
set forth on Schedule 2.01 or in the Assignment and Assumption pursuant to which
such Lender shall have assumed its Tranche B Term Loan Commitment, as
applicable. The initial aggregate amount of the Tranche B Term Lenders' Tranche
B Term Loan Commitments is $650,000,000.
"Tranche B Term Obligations" means (a) the due and punctual payment
of (i) the principal of and interest (including interest accruing during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Tranche B Term Loans, when and as due, whether at maturity, by acceleration,
upon one or more dates set for prepayment or otherwise and (ii) all other
monetary obligations of the Credit Parties to any of the Tranche B Term Lenders
under this Agreement and each of the other Credit Documents, including fees,
costs, expenses and indemnities, whether primary, secondary, direct, contingent,
fixed or otherwise (including monetary obligations incurred during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), and (b) the due
and punctual performance of all other obligations of the Credit Parties to any
of the Tranche B Term Lenders under this Agreement and the other Credit
Documents.
"Transactions" means the execution, delivery and performance by the
Borrower of this Agreement and the First Amendment and by the Borrower, the
Subsidiary Guarantors and the Grantors, as applicable, of the other Credit
Documents, the borrowing of the Loans, the obtaining and use of the Letters of
Credit, the creation of the Liens and Guarantees provided for in the Security
Documents and the other transactions contemplated hereby.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"UCC" means Article 9 of the Uniform Commercial Code as from time to
time in effect in the State of New York.
"US Revolving Facility Agreement" means the $750,000,000 Revolving
Loan Agreement dated as of the date hereof among the Borrower, certain lenders
and JPMCB, as administrative agent.
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"US Term Facility Agreement" means the $645,545,454 Term Loan
Agreement dated as of the date hereof among the Borrower, certain lenders,
JPMCB, as administrative agent, and BNP Paribas, as syndication agent.
"Wholly Owned Subsidiary" of any person shall mean a subsidiary of
such person of which securities (except for directors' qualifying shares) or
other ownership interests representing 100% of the Equity Interests are, at the
time any determination is being made, owned, controlled or held by such person
or one or more wholly owned Subsidiaries of such person or by such person and
one or more wholly owned Subsidiaries of such person.
"Wingfoot" means Wingfoot Commercial Systems LLC.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes
of this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing"). For purposes of determining compliance as of any date with Section
6.08, amounts incurred in euros during 2003 shall be translated into dollars at
the exchange rate in effect on March 31, 2003, and amounts incurred in euros
during any subsequent year shall be translated into dollars at the exchange rate
determined by the Borrower and used in its Annual Operating Plan for such year
(which exchange rate shall be determined reasonably and set forth in the first
certificate delivered pursuant to Section 5.01(c) during such year).
SECTION 1.03. Foreign Currency Translation. For purposes of
determining compliance as of any date with Section 6.01, 6.02, 6.03, 6.05 or
6.06, amounts incurred or outstanding in currencies other than dollars shall be
translated into dollars at the exchange rates in effect on the first Business
Day of the fiscal quarter in which such determination occurs or in respect of
which such determination is being made, as such exchange rates shall be
determined in good faith by the Borrower. No Default or Event of Default shall
arise as a result of any limitation set forth in dollars in Section 6.01, 6.02,
6.03, 6.05 or 6.06 being exceeded solely as a result of changes in currency
exchange rates from those rates applicable on the first day of the fiscal
quarter in which such determination occurs or in respect of which such
determination is being made.
SECTION 1.04. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to
37
have the same meaning and effect as the word "shall". Unless the context
requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, but shall not be deemed to include the subsidiaries of such Person
unless express reference is made to such subsidiaries, (c) the words "herein",
"hereof" and "hereunder", and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules
shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, this Agreement, (e) the words "asset" and "property" shall be
construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights and (f) references herein to "the date hereof" or
"the date of this Agreement" shall be deemed to be references to March 31, 2003,
the date of the Original Credit Agreement.
SECTION 1.05. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Majority Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
The Credits
SECTION 2.01. Commitments. (a) Subject to the terms and conditions
set forth herein, (i) each Tranche A Term Lender made a Tranche A Term Loan to
the Borrower on the Original Effective Date in a principal amount equal to its
Tranche A Term Loan Commitment, (ii) each Tranche B Term Lender agrees to make a
Tranche B Term Loan to the Borrower on the Restatement Effective Date in a
principal amount equal to its Tranche B Term Loan Commitment and (iii) each
Revolving Lender has made and agrees to make Revolving Loans to the Borrower
from time to time during the Revolving Availability Period in an aggregate
principal amount that will not result in (x) such Lender's Revolving Credit
Exposure exceeding such Lender's Revolving Commitment or (y) the aggregate
Revolving Credit Exposure exceeding the Borrowing Base Availability then in
effect.
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(a) Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and reborrow
Revolving Loans. Amounts repaid in respect of Term Loans may not be reborrowed.
SECTION 2.02. Loans and Borrowings. (a) Each Loan shall be made as
part of a Borrowing consisting of Loans of the same Class and Type made by the
Lenders ratably in accordance with their respective Commitments of the
applicable Class. The failure of any Lender to make any Loan required to be made
by it shall not relieve any other Lender of its obligations hereunder; provided
that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.12, each Revolving Borrowing and Term
Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the
Borrower may request in accordance herewith. Each Lender at its option may make
any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of
such Lender to make such Loan; provided that any exercise of such option shall
not affect the obligation of the Borrower to repay such Loan in accordance with
the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $10,000,000. At the time that each ABR
Borrowing is made, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $5,000,000; provided, that an
ABR Revolving Borrowing may be in an aggregate amount that is equal to the
entire unused balance of the total Revolving Commitments or that is required to
finance the reimbursement of an LC Disbursement as contemplated by Section
2.04(e). Borrowings of more than one Type and Class may be outstanding at the
same time; provided that there shall not at any time be more than a total of 20
Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Maturity Date.
SECTION 2.03. Requests for Borrowing. To request a Revolving
Borrowing or Term Borrowing, the Borrower shall notify the Administrative Agent
of such request by telephone (a) in the case of a Eurodollar Borrowing, not
later than 3:00 p.m., New York City time, three Business Days before the date of
the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than
10:30 a.m., New York City time, on the day of the proposed Borrowing; provided
that any such notice of an ABR Borrowing to finance reimbursement of an LC
Disbursement as contemplated by Section 2.04(e) may be given not later than
10:00 a.m., New York City time, on the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request signed by the Borrower. Each such telephonic and written
Borrowing Request shall specify the following information in compliance with
Section 2.02:
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(i) the Class of the requested Borrowing;
(ii) the aggregate amount of the requested Borrowing;
(iii) the date of such Borrowing, which shall be a Business Day;
(iv) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(v) in the case of a Eurodollar Borrowing, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by
the definition of the term "Interest Period"; and
(vi) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.05.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month's duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04. Letters of Credit. (a) General. Subject to the terms
and conditions set forth herein, the Borrower may request the issuance (or the
amendment, renewal or extension) of Letters of Credit for its own account, in a
form reasonably acceptable to the Administrative Agent and the applicable
Issuing Bank, at any time and from time to time during the Revolving
Availability Period. In the event of any inconsistency between the terms and
conditions of this Agreement and the terms and conditions of any form of letter
of credit application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, any Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control. The Borrower
may at any time redesignate letters of credit issued and outstanding under the
US Revolving Facility Agreement as Letters of Credit hereunder; provided, that
(i) the Borrower shall by notice to the Administrative Agent identify the
letters of credit to be redesignated as Letters of Credit hereunder (each of
which shall have been issued by a Lender that is an Issuing Bank under this
Agreement) and certify that the conditions to such redesignation set forth in
the following clause (ii) are satisfied; and (ii) no redesignation of a letter
of credit shall become effective hereunder unless after giving effect to such
redesignation no Default shall have occurred and be continuing and the
conditions precedent to the issuance, amendment, renewal or extension of a
Letter of Credit under clause (b) below shall be satisfied. The Revolving
Lenders hereby agree that upon the effectiveness of any such redesignation, each
Issuing Bank that has issued any such letter of credit under the US Revolving
Facility Agreement shall be deemed, without further action by any party hereto,
to have granted to each Revolving Lender, and each such Lender shall be deemed
to have purchased from such Issuing Bank, a
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participation in such Letter of Credit in accordance with paragraph (d) below.
On and after the effectiveness of any such redesignation, such letter of credit
shall constitute a Letter of Credit for all purposes hereof.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the applicable Issuing Bank) to
an Issuing Bank and the Administrative Agent (reasonably in advance of the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this
Section), the amount of such Letter of Credit, the name and address of the
beneficiary thereof and such other information as shall be necessary to prepare,
amend, renew or extend such Letter of Credit. If requested by any Issuing Bank,
the Borrower also shall submit a letter of credit application on such Issuing
Bank's standard form in connection with any request for a Letter of Credit;
provided that any provisions in any such letter of credit application that
create Liens securing the obligations of the Borrower thereunder or that are
inconsistent with the provisions of this Agreement shall be of no force or
effect. A Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Letter of Credit the
Borrower shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension (i) the LC Exposure shall not
exceed $450,000,000, (ii) the aggregate amount of the Lenders' Revolving Credit
Exposures shall not exceed the aggregate Revolving Commitments, (iii) the
Revolving Credit Exposure shall not exceed the Borrowing Base Availability and
(iv) the LC Exposure and the LC Exposure under and as defined in the US
Revolving Facility Agreement shall not, in the aggregate, exceed $600,000,000.
(c) Expiration Date. Each Letter of Credit shall expire at or prior
to the close of business on the earlier of (i) the date one year after the date
of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the applicable Issuing Bank or the Lenders, such
Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender
hereby acquires from such Issuing Bank, a participation in such Letter of Credit
equal to such Lender's Applicable Percentage of the aggregate amount available
to be drawn under such Letter of Credit. In consideration and in furtherance of
the foregoing, each Revolving Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of the applicable
Issuing Bank, such Lender's Applicable Percentage of each LC Disbursement made
by such Issuing Bank and not reimbursed by the Borrower on the
41
date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Revolving
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of any Letter of Credit or the
occurrence and continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever.
(e) Reimbursement. If any Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 1:30 p.m., New York City time, on the date that such
LC Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 10:00 a.m., New York City time, on such date, or, if such
notice has not been received by the Borrower prior to such time on such date,
then not later than 1:30 p.m., New York City time, on (i) the Business Day that
the Borrower receives such notice, if such notice is received prior to 10:00
a.m., New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to such time on the day of receipt or (iii) if such
LC Disbursement is not less than the applicable minimum borrowing amount, on the
second Business Day after the day otherwise applicable under clause (i) or (ii);
provided that, if such LC Disbursement is not less than the applicable minimum
borrowing amount, unless the Borrower shall have notified the Administrative
Agent to the contrary, the Borrower will be deemed to have requested in
accordance with Section 2.03 that such payment be financed with an ABR Borrowing
in an equivalent amount and, to the extent so financed, the Borrower's
obligation to make such payment shall be discharged and replaced by the
resulting ABR Borrowing. If the Borrower fails to make such payment when due,
the Administrative Agent shall notify each Revolving Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Revolving Lender's Applicable Percentage thereof. Promptly following receipt of
such notice, each Revolving Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same
manner as provided in Section 2.05 with respect to Loans made by such Lender
(and Section 2.05 shall apply, mutatis mutandis, to the payment obligations of
the Revolving Lenders), and the Administrative Agent shall promptly pay to the
applicable Issuing Bank the amounts so received by it from the Revolving
Lenders. Promptly following receipt by the Administrative Agent of any payment
from the Borrower pursuant to this paragraph, the Administrative Agent shall
distribute such payment to such Issuing Bank or, to the extent that Revolving
Lenders have made payments pursuant to this paragraph to reimburse such Issuing
Bank, then to such Lenders and such Issuing Bank as their interests may appear.
Any payment made by a Revolving Lender pursuant to this paragraph to reimburse
any Issuing Bank for any LC Disbursement (other than the funding of ABR Loans as
contemplated above) shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement.
42
(f) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by any Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. None of
the Administrative Agent, the Revolving Lenders or the Issuing Banks, or any of
their Related Parties, shall have any liability or responsibility by reason of
or in connection with the issuance or transfer of any Letter of Credit or any
payment or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Banks; provided that the foregoing shall not be construed to excuse any
Issuing Bank from liability to the Borrower to the extent of any damages
suffered by the Borrower or any Revolving Lender that are caused by such Issuing
Bank's gross negligence or willful misconduct. In furtherance of the foregoing
and without limiting the generality thereof, the parties agree that, with
respect to documents presented which appear on their face to be in substantial
compliance with the terms of a Letter of Credit, the applicable Issuing Bank
may, acting in good faith, either accept and make payment upon such documents
without responsibility for further investigation or refuse to accept and make
payment upon such documents if such documents are not in strict compliance with
the terms of such Letter of Credit.
(g) Disbursement Procedures. Each Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. Each Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether such Issuing Bank has made or
will make an LC Disbursement thereunder; provided that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse such Issuing Bank and the Lenders with respect to any such LC
Disbursement.
(h) Interim Interest. If any Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Loans; provided that,
if the Borrower fails to reimburse such LC
43
Disbursement when due pursuant to paragraph (e) of this Section, then Section
2.11(c) shall apply. Interest accrued pursuant to this paragraph shall be for
the account of such Issuing Bank, except that interest accrued on and after the
date of payment by any Revolving Lender pursuant to paragraph (e) of this
Section to reimburse such Issuing Bank shall be for the account of such Lender
to the extent of such payment.
(i) Replacement of the Issuing Bank. Each Issuing Bank may be
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Revolving Lenders of any such replacement
of such Issuing Bank. At the time any such replacement shall become effective,
the Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.10(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of such Issuing Bank under this Agreement with respect to
Letters of Credit to be issued thereafter and (ii) references herein to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of any Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall not be
required to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and
be continuing, on the earlier of (i) the third Business Day after the Borrower
shall receive notice from the Administrative Agent or the Majority Lenders
demanding the deposit of cash collateral pursuant to this paragraph and (ii) the
date on which the maturity of the Loans shall be accelerated, unless prohibited
by the terms of any other New Facilities Credit Agreement, the Borrower shall
deposit in an account with the Administrative Agent, in the name of the
Administrative Agent and for the benefit of the Revolving Lenders, an amount in
cash equal to the LC Exposure as of such date plus any accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence
of any Event of Default with respect to the Borrower described in clause (h) or
(i) of Article VII. Such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the obligations of the Borrower
under this Agreement. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest earned on the investment of such deposits, which investment
shall be in Permitted Investments and shall be made in the discretion of the
Administrative Agent and at the Borrower's risk and expense, such deposits shall
not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse each Issuing Bank for LC Disbursements for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving Lenders with LC Exposures
representing greater than 50% of the total LC Exposure), be
44
applied to satisfy other obligations of the Borrower under this Agreement. If
the Borrower is required to provide an amount of cash collateral under this
paragraph, then (i) if the maturity of the Loans has not been accelerated and
the LC Exposure shall be reduced to an amount below the amount so deposited, the
Administrative Agent will return to the Borrower any excess of the amount so
deposited over the LC Exposure and (ii) such amount (to the extent not applied
as provided above in this paragraph) shall be returned to the Borrower within
three Business Days after all Events of Default have been cured or waived.
SECTION 2.05. Funding of Borrowings. (a) Each Lender shall make each
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:30 p.m., New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders. The Administrative Agent will make such Loans available
to the Borrower by promptly crediting the amounts so received, in like funds, to
an account designated by the Borrower in the applicable Borrowing Request;
provided that ABR Loans made to finance the reimbursement of an LC Disbursement
as provided in Section 2.04(e) shall be remitted by the Administrative Agent to
the applicable Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from
a Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation or (ii) in the case of the Borrower,
the interest rate applicable to ABR Loans. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing. It is agreed that no payment by the Borrower under
this paragraph will be subject to any break-funding payment under Section 2.14.
SECTION 2.06. Interest Elections. (a) Each Revolving Borrowing and
Term Loan Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an
initial Interest Period as specified in such Borrowing Request. Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue
such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest
Periods therefor, all as provided in this Section. The Borrower may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the
45
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Revolving Borrowing or Term Borrowing of the Type resulting from
such election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Interest Election Request signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Majority Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be converted to
or continued as a Eurodollar Borrowing and
46
(ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.07. Termination of Commitments; Reductions of Commitments.
(a) The Tranche A Term Loan Commitments terminated on the Original Effective
Date. Unless previously terminated, (i) the Tranche B Term Loan Commitments
shall terminate at 5:00 p.m., New York City time, on the Restatement Effective
Date and (ii) the Revolving Commitments shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments of any Class; provided that (i) each reduction of the
Commitments of any Class shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.09,
the total Revolving Credit Exposures would exceed the total Revolving
Commitments.
(c) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided that a notice
of termination of the Revolving Commitments delivered by the Borrower may state
that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments of
any Class shall be permanent. Each reduction of the Commitments of any Class
shall be made ratably among the Lenders in accordance with their respective
Commitments of such Class.
SECTION 2.08. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay (i) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan
of such Lender on the Maturity Date and (ii) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Term Loan of
such Lender on the Maturity Date.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the Indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and
47
(iii) the amount of any sum received by the Administrative Agent hereunder for
the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein (including any failure to record the making or repayment of
any Loan) shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement or prevent the
Borrower's obligations in respect of Loans from being discharged to the extent
of amounts actually paid in respect thereof.
(e) Any Lender may request that Loans of any Class made by it be
evidenced by a promissory note. In such event, the Borrower shall prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns) in substantially the form set forth in Exhibit C hereto. Thereafter,
the Loans evidenced by such promissory note and interest thereon shall at all
times (including after assignment pursuant to Section 9.04) be represented by
one or more promissory notes in such form payable to the order of the payee
named therein (or, if such promissory note is a registered note, to such payee
and its registered assigns).
SECTION 2.09. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to paragraph (c) of this Section and to prior notice in accordance
with paragraph (d) of this Section.
(b) The Borrower shall (i) in the event and on each occasion that
the aggregate Revolving Credit Exposures exceed the total Revolving Commitments,
not later than the next Business Day, and (ii) in the event and on each occasion
that the aggregate Revolving Credit Exposures exceed the Borrowing Base
Availability then in effect, not later than the next Business Day after any date
on which a Borrowing Base Certificate or interim calculation of Eligible
Accounts Receivable is due under Section 5.09(a) that shows or would show such
excess, prepay Revolving Borrowings in an aggregate amount equal to such excess,
and in the event that after such prepayment of Revolving Borrowings any such
excess shall remain, the Borrower shall deposit cash in an amount equal to such
excess as collateral for the reimbursement obligations of the Borrower in
respect of Letters of Credit. Any cash so deposited (and any cash previously
deposited pursuant to this paragraph) with the Administrative Agent shall be
held in an account over which the Administrative Agent shall have dominion and
control to the exclusion of the Borrower and its Subsidiaries, including the
exclusive right of withdrawal. Other than any interest earned on the investment
of such deposits, which investment shall be in Permitted Investments and shall
be made in the discretion of the Administrative Agent (or, at any time when no
Default or Event of Default has occurred and is continuing, shall be made at the
direction of the Borrower) and at the Borrower's risk and expense, such deposits
shall not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied
48
by the Administrative Agent to reimburse each Issuing Bank for LC Disbursements
for which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Lenders with LC Exposures
representing greater than 50% of the total LC Exposure), be applied to satisfy
other obligations of the Borrower under this Agreement. If the Borrower has
provided cash collateral to secure the reimbursement obligations of the Borrower
in respect of Letters of Credit hereunder, then, so long as no Event of Default
shall exist, such cash collateral shall be released to the Borrower if so
requested by the Borrower at any time if and to the extent that, after giving
effect to such release, the aggregate Revolving Credit Exposures will not exceed
the Borrowing Base Availability. In the event that after such prepayment of
Revolving Borrowings and the deposit of cash to collateralize reimbursement
obligations in respect of Letters of Credit hereunder any such excess shall
remain, the Borrower shall prepay Term Borrowings in an aggregate amount equal
to such remaining excess (or, to the extent of not more than $80,000,000 of such
remaining excess, deposit cash collateral in an account with the Administrative
Agent, in the name of the Administrative Agent and for the benefit of the
Lenders to secure the Obligations; provided that any amount in such account that
shall not have been applied to the payment of the Obligations shall be returned
to the Borrower at such time as no such remaining excess shall exist; provided
further that if after 60 days following the deposit of such cash collateral any
of such cash collateral shall not have been returned to the Borrower as provided
above, the Borrower shall at such time repay Term Borrowings in such amount (it
being understood that such cash collateral may be utilized to make such payment
at such time)).
(c) Each prepayment of Term Loans shall be applied to the Tranche A
Term Loans and the Tranche B Term Loans ratably in accordance with the amounts
of such Loans outstanding at the time of such prepayment.
(d) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 3:00 p.m., New York City
time, three Business Days before the date of prepayment or (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment; provided that if the Borrower
shall be required to make any prepayment hereunder by reason of Section 2.09(b),
such notice shall be delivered not later than the time at which such prepayment
is made. Each such notice shall be irrevocable, shall specify the prepayment
date and the principal amount of each Borrowing or portion thereof to be
prepaid; provided that, if a notice of prepayment is given in connection with a
conditional notice of termination of the Revolving Commitments as contemplated
by Section 2.07, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.07. Promptly following
receipt of any such notice relating to a Borrowing, the Administrative Agent
shall advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing (other than pursuant to Section 2.09(b)) shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid
49
Borrowing. Prepayments shall be accompanied by accrued interest to the extent
required by Section 2.11.
SECTION 2.10. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee, accruing
at the rate of 0.75% per annum on the daily unused amount of the Revolving
Commitment of such Lender during the period from and including the date hereof
to but excluding the date on which such Revolving Commitment terminates. Accrued
commitment fees shall be payable in arrears in the case of commitment fees in
respect of the Revolving Commitments, on the last day of March, June, September
and December of each year and on the date on which the Revolving Commitments
terminate, commencing on the first such date to occur after the date hereof. All
commitment fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).
(b) The Borrower agrees to pay (i) to the Administrative Agent, for
the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the rate of 4.00% per
annum on the average daily amount of such Lender's LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) during the period
from and including the Restatement Effective Date to but excluding the later of
the date on which such Lender's Revolving Commitment terminates and the date on
which such Lender ceases to have any LC Exposure, and (ii) to each Issuing Bank
a fronting fee, which shall accrue at the rate or rates per annum separately
agreed upon between the Borrower and the applicable Issuing Bank (on the date
hereof or any later date on which such Issuing Bank shall have become an Issuing
Bank), on the average daily amount of the LC Exposure attributable to Letters of
Credit issued by such Issuing Bank (excluding any portion thereof attributable
to unreimbursed LC Disbursements) during the period from and including the
Restatement Effective Date to but excluding the later of the date of termination
of the Revolving Commitments and the date on which there ceases to be any LC
Exposure attributable to Letters of Credit issued by such Issuing Bank, as well
as such Issuing Bank's standard fees with respect to the issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through and including
the last day of March, June, September and December of each year shall be
payable on the third Business Day following such last day, commencing on the
first such date to occur after the Restatement Effective Date; provided that all
such accrued fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Banks pursuant to this paragraph shall be payable within
10 days after demand. All participation fees and fronting fees shall be computed
on the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its
own account, fees in the amounts and at the times separately agreed upon between
the Borrower and the Administrative Agent.
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(d) On each date on which (i) Revolving Commitments are terminated
or reduced, (ii) Term Loans are repaid or prepaid (whether on a voluntary or
mandatory basis), (iii) the Revolving Availability Period is extended or (iv)
the Maturity Date is extended, the Borrower agrees to pay to the Administrative
Agent for the account of each Lender holding a Revolving Commitment or Term
Loan, as applicable, on such date a fee equal to 2.00% or, at any time on or
after April 1, 2004, 1.00% of the amount of such Lender's Revolving Commitments
or Term Loans subject to such termination, reduction, repayment, prepayment or
extension.
(e) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Banks, in case of fees payable to them) for distribution, in the case of
commitment fees, to the Lenders. Fees paid shall not be refundable under any
circumstances.
SECTION 2.11. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate plus (i) in the case of Tranche A
Term Loans and Revolving Loans, 3.00% per annum and (ii) in the case of Tranche
B Term Loans, (A) on any Improved Ratings Day, 3.25% per annum and (B) on any
other day, 3.50% per annum.
(b) The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus (i) in the case of Tranche A Term Loans and Revolving Loans,
4.00% per annum and (ii) in the case of Tranche B Term Loans, (A) on any
Improved Ratings Day, 4.25% per annum and (B) on any other day, 4.50% per annum.
(c) Notwithstanding the foregoing, if any principal of or interest
on any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2.00% plus
the rate otherwise applicable to such Loan as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount, 2.00% plus
the rate applicable to ABR Loans as provided in paragraph (a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on
each Interest Payment Date for such Loan and, in the case of Revolving Loans,
upon termination of the Revolving Commitments; provided that (i) interest
accrued pursuant to paragraph (c) of this Section shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan (other than a
prepayment of an ABR Revolving Loan prior to the end of the Revolving
Availability Period), accrued interest on the principal amount repaid or prepaid
shall be payable on the date of such repayment or prepayment and (iii) in the
event of any conversion of any Eurodollar Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.
51
(e) All interest hereunder shall be computed on the basis of a year
of 360 days, except that interest computed by reference to the Alternate Base
Rate at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
SECTION 2.12. Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate for such Interest
Period; or
(b) the Administrative Agent is advised by the Majority Lenders that
the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (or Lender) of making or
maintaining their Loans (or its Loan) included in such Borrowing for such
Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.
SECTION 2.13. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit
or similar requirement against assets of, deposits with or for the account
of, or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or any Issuing Bank; or
(ii) impose on any Lender or any Issuing Bank or the London
interbank market any other condition (other than Taxes) affecting this
Agreement or Eurodollar Loans made by such Lender or any Letter of Credit
or participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or such
Issuing Bank of participations in, issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by such Lender or such
Issuing Bank hereunder (whether of principal, interest or otherwise), in each
case by an amount deemed by such Lender or Issuing Bank, as the case may be, to
be material then the Borrower will pay to such Lender or such Issuing Bank such
additional amount or amounts as will compensate such
52
Lender or such Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
(b) If any Lender or any Issuing Bank determines that any Change in
Law regarding capital requirements has had or would have the effect of reducing
the rate of return on such Lender's or such Issuing Bank's capital or on the
capital of such Lender's or such Issuing Bank's holding company, if any, in each
case by an amount deemed by such Lender or such Issuing Bank to be material, as
a consequence of this Agreement or the Loans made by, or participations in
Letters of Credit held by, such Lender, or the Letters of Credit issued by such
Issuing Bank, to a level below that which such Lender or such Issuing Bank or
such Lender's or such Issuing Bank's holding company would have achieved but for
such Change in Law (taking into consideration such Lender's or such Issuing
Bank's policies and the policies of such Lender's or such Issuing Bank's holding
company with respect to capital adequacy), then from time to time the Borrower
will pay to such Lender or such Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or such Issuing Bank
or such Lender's or such Issuing Bank's holding company for any such reduction
suffered.
(c) A certificate of a Lender or an Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or such Issuing Bank or
its holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section shall be delivered to the Borrower. The Borrower shall pay such
Lender or such Issuing Bank, as the case may be, the amount shown as due on any
such certificate within 10 days after receipt thereof, unless such amount is
being contested by the Borrower in good faith.
(d) Failure or delay on the part of any Lender or Issuing Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or such Issuing Bank's right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender or an Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or such Issuing Bank
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender's or such Issuing Bank's intention to claim
compensation therefor; provided further that, if the Change in Law giving rise
to such increased costs or reductions is retroactive, then the 180-day period
referred to above shall be extended to include the period of retroactive effect
thereof.
SECTION 2.14. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under Section
2.09(c) and is revoked in accordance therewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.17, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender
53
shall be deemed to include an amount determined by such Lender to be the excess,
if any, of (i) the amount of interest which would have accrued on the principal
amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that
would have been applicable to such Loan, for the period from the date of such
event to the last day of the then current Interest Period therefor (or, in the
case of a failure to borrow, convert or continue, for the period that would have
been the Interest Period for such Loan), over (ii) the amount of interest which
would accrue on such principal amount for such period at the interest rate which
such Lender would bid were it to bid, at the commencement of such period, for
dollar deposits of a comparable amount and period from other banks in the
Eurodollar market. A certificate of any Lender setting forth any amount or
amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower. The Borrower shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof,
unless such amount is being contested by the Borrower in good faith.
SECTION 2.15. Taxes. (a) Any and all payments by or on account of
any obligation of the Borrower or any other Credit Party hereunder or under any
other Credit Document shall be made free and clear of and without deduction for
any Indemnified Taxes or Other Taxes; provided that if the Borrower or any other
Credit Party shall be required to deduct any Indemnified Taxes or Other Taxes
from such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions of such Taxes (including deductions
applicable to additional sums payable under this Section) the Administrative
Agent, Issuing Bank or Lender (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made (and the
Borrower shall pay or cause such Credit Party to pay such increased amount),
(ii) the Borrower or such other Credit Party shall make such deductions and
(iii) the Borrower or such other Credit Party shall pay the full amount deducted
to the relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each
Issuing Bank and each Lender, within 10 days after written demand therefor, for
the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Issuing Bank or such Lender, as the case may be, on
or with respect to any payment by or on account of any obligation of the
Borrower or any other Credit Party hereunder or under any other Credit Document
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable out-of-pocket expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate as to
the amount of such payment or liability delivered to the Borrower by a Lender,
or the applicable Issuing Bank or by the Administrative Agent on its own behalf
or on behalf of the applicable Issuing Bank or a Lender, shall be conclusive
absent manifest error.
54
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower or any other Credit Party to a Governmental
Authority, the Borrower shall deliver to the Administrative Agent the original
or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time such Foreign Lender first becomes
a party to this Agreement and at the time or times prescribed by applicable law,
such properly completed and executed documentation prescribed by applicable law
or reasonably requested by the Borrower as will permit such payments to be made
without withholding or at a reduced rate; provided that such Foreign Lender has
received written notice from the Borrower advising it of the availability of
such exemption or reduction and supplying all applicable documentation.
SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of
Setoffs.
(a) Except as required or permitted under Section 2.03, 2.04, 2.13,
2.14, 2.15, 2.17 or 9.03, each Borrowing, each payment or prepayment of
principal of any Borrowing or of any LC Disbursement, each payment of interest
on the Loans or the LC Disbursements, each payment of fees (other than fees
payable to the Issuing Banks), each reduction of the Commitments and each
refinancing of any Borrowing with a Borrowing of any Type, shall be allocated
pro rata among the Lenders in accordance with their respective Commitments (or,
if such Commitments shall have expired or been terminated, in accordance with
the respective principal amounts of their outstanding Loans). Each Lender agrees
that in computing such Lender's portion of any Borrowing to be made hereunder,
the Administrative Agent may, in its discretion, round each Lender's percentage
of such Borrowing to the next higher or lower whole dollar amount.
(b) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.13, 2.14 or 2.15 or
otherwise) prior to 1:00 p.m., New York City time, on the date when due, in
immediately available funds, without setoff, counterclaim or other deduction.
Any amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, except payments to be made directly to an Issuing Bank as
expressly provided herein and except that payments pursuant to Sections 2.13,
2.14, 2.15, 2.17 and 9.03 shall be made directly to the Persons entitled
thereto. The Administrative Agent shall distribute any such payments received by
it for the account of any other Person in appropriate ratable shares to the
appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a
55
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(c) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, unreimbursed
LC Disbursements, interest and fees then due hereunder, such funds shall be
applied (i) first, towards payment of interest and fees then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, towards payment of
principal and unreimbursed LC Disbursements then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of principal and
unreimbursed LC Disbursements then due to such parties. Notwithstanding the
foregoing provisions of this paragraph, the Administrative Agent shall not be
required to distribute any Collateral or proceeds of Collateral in a manner
inconsistent with the rights of the Tranche A Term Lenders and the Revolving
Lenders on the one hand, and the Tranche B Term Lenders on the other hand, under
Section 7.02.
(d) If any Tranche A Term Lender or Revolving Lender shall, by
exercising any right of setoff or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Loans or participations in
LC Disbursements resulting in such Tranche A Term Lender or Revolving Lender
receiving payment of a greater proportion of the aggregate amount of its Loans,
participations in LC Disbursements and accrued interest thereon than the
proportion received by any other Tranche A Term Lender or Revolving Lender, then
the Tranche A Term Lender or Revolving Lender receiving such greater proportion
shall purchase (for cash at face value) participations in the Loans and
participations in LC Disbursements of other Tranche A Term Lenders or Revolving
Lenders to the extent necessary so that the benefit of all such payments shall
be shared by the Tranche A Term Lender or Revolving Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and participations in LC Disbursements. If any Tranche B
Lender shall, by exercising any right of setoff or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans
resulting in such Tranche B Lender receiving payment of a greater proportion of
the aggregate amount of its Loans and accrued interest thereon than the
proportion received by any other Tranche B Lender, then the Tranche B Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans of other Tranche B Lenders to the extent necessary
so that the benefit of all such payments shall be shared by the Tranche B
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans. If any participations are purchased
pursuant to the preceding sentences and all or any portion of the payments
giving rise thereto are recovered, such participations shall be rescinded and
the purchase price restored to the extent of such recovery, without interest.
The provisions of this paragraph shall not be construed to apply to any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the
56
Borrower or any Affiliate thereof (as to which the provisions of this paragraph
shall apply). The Borrower consents to the foregoing and agrees, to the extent
it may effectively do so under applicable law and under this Agreement, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of setoff and counterclaim with respect to
such participation as fully as if such Lender were a direct creditor of the
Borrower in the amount of such participation.
(e) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or any Issuing Bank hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing
Banks, as the case may be, the amount due. In such event, if the Borrower has
not in fact made such payment, then each of the Lenders or the Issuing Banks, as
the case may be, severally agrees to repay to the Administrative Agent forthwith
on demand the amount so distributed to such Lender or Issuing Bank with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation.
(f) If any Lender shall fail to make any payment required to be made
by it hereunder for the account of the Administrative Agent, any Issuing Bank or
any Lender, then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy
such Lender's obligations in respect of such payment until all such unsatisfied
obligations are fully paid.
SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.13 or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.13 or 2.15, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.13, or if
the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require
57
such Lender to assign and delegate, without recourse (in accordance with and
subject to the restrictions contained in Section 9.04), all its interests,
rights and obligations under this Agreement to an assignee that shall assume
such obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
written consent of the Administrative Agent, which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in LC
Disbursements, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, from the assignee or the Borrower, as the case may be,
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.13 or payments required to be made pursuant to
Section 2.15, such assignment will result in a reduction in such compensation or
payments.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. The Borrower and each of the
other Credit Parties is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, has all requisite power
and authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, would not be reasonably
likely to result in a Material Adverse Change, is qualified to do business, and
is in good standing, in every jurisdiction where such qualification is required.
Each Subsidiary of the Borrower other than the Credit Parties is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as
now conducted and is qualified to do business, and is in good standing, in every
jurisdiction where such qualification is required, except for failures that,
individually or in the aggregate, would not be materially likely to result in a
Material Adverse Change.
SECTION 3.02. Authorization; Enforceability. The Transactions to be
entered into by each Credit Party are within such Credit Party's powers and have
been duly authorized. This Agreement has been duly executed and delivered by the
Borrower and constitutes, and each other Credit Document to which any Credit
Party is to be a party, when executed and delivered by such Credit Party, will
constitute, a legal, valid and binding obligation of the Borrower or such Credit
Party, as the case may be, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03. Governmental Approvals; No Conflicts. Except to the
extent that no Material Adverse Change would be materially likely to result, the
Transactions (a) do not require any consent or approval of, registration or
filing with, or
58
any other action by, any Governmental Authority, except such as are required to
perfect Liens created under the Security Documents and such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of the Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Borrower or any of the
Subsidiaries or any of their assets, and (d) will not result in the creation or
imposition of any Lien on any asset of the Borrower or any of the Subsidiaries,
except Liens created under the Credit Documents.
SECTION 3.04. Financial Statements; No Material Adverse Change. (a)
The Borrower has heretofore furnished to the Lenders a draft in substantially
final form of its consolidated balance sheet and statements of income,
stockholders' equity and cash flows as of and for the fiscal year ended December
31, 2002. Such financial statements present fairly, in all material respects,
the consolidated financial position and consolidated results of operations and
cash flows of the Borrower and its Consolidated Subsidiaries as of such dates
and for such fiscal year in accordance with GAAP.
(b) Except as disclosed in the Disclosure Documents, since December
31, 2002, there has been no event or condition that constitutes or would be
materially likely to result in a Material Adverse Change, it being agreed that a
reduction in any rating relating to the Borrower issued by any rating agency
shall not, in and of itself, be an event or condition that constitutes or would
be materially likely to result in a Material Adverse Change (but that events or
conditions underlying or resulting from any such reduction may constitute or be
materially likely to result in a Material Adverse Change).
SECTION 3.05. Litigation and Environmental Matters. (a) Except as
set forth in the Disclosure Documents, there are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority pending or, to
the knowledge of the Borrower, threatened against or affecting the Borrower or
any of the Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination and that if adversely determined would be materially
likely, individually or in the aggregate, to result in a Material Adverse Change
or (ii) that involve the Credit Documents or the Transactions.
(b) Except as set forth in the Disclosure Documents, and except with
respect to matters that, individually or in the aggregate, would not be
materially likely to result in a Material Adverse Change, neither the Borrower
nor any of the Subsidiaries (i) has failed to comply with any Environmental Law
or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has become subject to any
Environmental Liability, (iii) has received notice of any claim with respect to
any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
SECTION 3.06. Compliance with Laws and Agreements. Each of the
Borrower and each of the Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its property, except where the failure
59
to be in compliance, individually or in the aggregate, would not be materially
likely to result in a Material Adverse Change. No Event of Default has occurred
and is continuing.
SECTION 3.07. Investment and Holding Company Status. Neither the
Borrower nor any of the Subsidiaries is (a) an "investment company" as defined
in, or subject to regulation under, the Investment Company Act of 1940, as
amended, or (b) a "holding company" as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 1935, as amended.
SECTION 3.08. (a) ERISA and Canadian Pension Plans. Except as
disclosed in the Disclosure Documents, no ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other ERISA
Events that have occurred or are reasonably expected to occur, would be
materially likely to result in a Material Adverse Change.
(b) The Canadian Pension Plans are duly registered under the Income
Tax Act (Canada) and all other applicable laws which require registration and no
event has occurred which is reasonably likely to cause the loss of such
registered status. All material obligations of each Credit Party (including
fiduciary, funding, investment and administration obligations) required to be
performed in connection with the Canadian Pension Plans and the funding
agreements therefor have been performed in a timely fashion. To the knowledge of
the Credit Parties there have been no improper withdrawals of the assets of the
Canadian Pension Plans or the Canadian Benefit Plans. There are no outstanding
material disputes concerning the assets of the Canadian Pension Plans or the
Canadian Benefit Plans. Each of the Canadian Pension Plans is being funded in
accordance with the actuarial valuation reports last filed with the applicable
Governmental Authorities and which are consistent with generally accepted
actuarial principles.
SECTION 3.09. Disclosure. Neither the Information Memorandum nor the
reports, financial statements, certificates or other written information
referred to in Section 3.04 or delivered after the date hereof by or on behalf
of any Credit Party to the Administrative Agent, the Collateral Agent or any
Lender pursuant to Section 5.01 (taken together with all other information so
furnished and as modified or supplemented by other information so furnished)
contained or will contain, in each case as of the date delivered, any material
misstatement of fact or omitted or will omit to state, in each case as of the
date delivered, any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided that, with respect to projected financial information or other forward
looking information, the Borrower represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time.
SECTION 3.10. Security Interests. (a) When executed and delivered,
each of the Guarantee and Collateral Agreement and the Canadian Security
Agreements will be effective to create in favor of the Collateral Agent for the
benefit of the Secured Parties a valid and enforceable security interest in the
ABL Facilities Collateral, to the
60
extent contemplated by the Guarantee and Collateral Agreement or the Canadian
Security Agreements, as the case may be, and when financing statements in
appropriate form are filed, and any other applicable registrations are made, in
the offices specified in the Perfection Certificate, the Guarantee and
Collateral Agreement and the Canadian Security Agreements will create a
perfected security interest (or hypothec, as applicable) in all right, title and
interest of the Grantors in the ABL Facilities Collateral to the extent
perfection can be obtained by filing Uniform Commercial Code financing
statements and making such other applicable filings and registrations in such
jurisdictions, prior and superior to the rights of any other Person and subject
to no other Lien other than Permitted Encumbrances.
(b) Upon (i) the recordation of the Guarantee and Collateral
Agreement or a memorandum of such Agreement with the United States Patent and
Trademark Office and (ii) the recordation of the Canadian Security Agreements
with the Canadian Intellectual Property Office, the Guarantee and Collateral
Agreement and the Canadian Security Agreements, as the case may be, will create
a perfected Lien on all right, title and interest of the Grantors in the
Material Trademarks in which a security interest may be perfected by such
recordation in the United States Patent and Trademark Office or the Canadian
Intellectual Property Office, as the case may be, subject to Liens permitted
under Section 6.02 (it being understood that subsequent recordings in the United
States Patent and Trademark Office or the Canadian Intellectual Property Office,
as the case may be, may be necessary to perfect a Lien on registered trademarks
and trademark applications acquired by the Grantors after the Original Effective
Date). As of the Original Effective Date, Schedule 3.10(b) sets forth all the
Material Trademarks.
(c) None of the Perfection Certificate or any other written
information relating to the Collateral delivered after the date hereof by or on
behalf of any Credit Party to the Administrative Agent, the Collateral Agent or
any Lender pursuant to any provision of any Credit Document is or will be
incorrect when delivered in any respect material to the rights or interests of
the Lenders under the Credit Documents.
SECTION 3.11. Use of Proceeds. The proceeds of the Loans will be
used only for the purposes referred to in the preamble to this Agreement. No
part of the proceeds of any Loan will be used, whether directly or indirectly,
for any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X.
ARTICLE IV
Conditions
SECTION 4.01. Each Credit Event. The obligation of each Lender to
make a Loan on the occasion of any Borrowing (other than a conversion or
continuation of an outstanding Borrowing) and of each Issuing Bank to issue,
amend, renew or extend any Letter of Credit, shall be subject to the
satisfaction of the following conditions:
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(a) The representations and warranties of the Borrower set forth in
this Agreement and in the other Credit Documents (insofar as they relate
to the transactions provided for herein or to the Collateral securing the
Obligations) shall be true and correct in all respects material to the
rights or interests of the Lenders under the Credit Documents on and as of
the date of such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, with the same effect as
though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date.
(b) After giving effect to such Borrowing or the issuance,
amendment, renewal or extension of such Letter of Credit, as applicable,
the aggregate Revolving Credit Exposure shall not exceed the Borrowing
Base Availability then in effect.
(c) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default or Event of Default shall have
occurred and be continuing and no breach of the delivery requirements of
Section 5.01(a) or (b) shall have occurred and be continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a), (b)
and (c) of this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments shall have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:
SECTION 5.01. Financial Statements and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender:
(a) as soon as available and in any event within 110 days after the
end of each fiscal year of the Borrower, its audited consolidated balance
sheet and related statements of income, stockholders' equity and cash
flows as of the end of and for such year, setting forth in each case in
comparative form the figures for the previous fiscal year, all reported on
by PricewaterhouseCoopers or other independent public accountants of
recognized national standing (without any qualification or exception as to
the scope of such audit) to the effect that such consolidated financial
statements present fairly in all material respects the financial condition
and results of operations of the Borrower and its Consolidated
Subsidiaries in accordance with GAAP consistently applied; and
concurrently
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with the filing of the Borrower's annual report on Form 10-K, an annual
operating plan prepared by management of the Borrower in a manner
consistent with past practice, which annual operating plan shall include,
for the fiscal year in which it is delivered, (i) annual and quarterly
projected income statements, annual and quarterly projected statements of
cash flow, and a projected year-end balance sheet as of the last day of
such fiscal year, in each case, for the Borrower and its Consolidated
Subsidiaries, and (ii) quarterly projections of unit and dollar sales,
EBIT and operating cash flow by business unit;
(b) as soon as available and in any event within 60 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Borrower, its consolidated balance sheet and related statements of income,
stockholders' equity and cash flows as of the end of and for such fiscal
quarter and the then elapsed portion of the fiscal year, setting forth in
each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the
previous fiscal year, all certified by one of its Financial Officers as
presenting fairly in all material respects the financial condition and
results of operations of the Borrower and its Consolidated Subsidiaries in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;
(c) not later than one Business Day after each delivery of financial
statements under clause (a) or (b) above, a certificate of a Financial
Officer (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken
or proposed to be taken with respect thereto, (ii) demonstrating
compliance with Sections 6.08, 6.09, 6.10 and 6.11 at the end of the
period to which such financial statements relate and for each applicable
period then ended, (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the most recent audited
financial statements delivered under clause (a) above (or, prior to the
delivery of any such financial statements, since December 31, 2002) and,
if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate and (iv) specifying
the exchange rate determined by the Borrower and used in its Annual
Operating Plan for the then current fiscal year (which rate the Borrower
agrees to determine reasonably);
(d) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
the Borrower or any Subsidiary with the United States Securities and
Exchange Commission, or any Governmental Authority succeeding to any or
all of the functions of said Commission, or with any national securities
exchange, or distributed by the Borrower to its shareholders generally, as
the case may be;
(e) at the time of each delivery of financial statements under
clause (a) or (b) above, and at such other times as the Borrower may
determine, a certificate of a Financial Officer identifying each Domestic
Subsidiary formed or acquired after the Original Effective Date and not
previously identified in a certificate delivered
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pursuant to this paragraph, stating whether each such Domestic Subsidiary
is a Consent Subsidiary and describing the factors that shall have led to
the identification of any such Domestic Subsidiary as a Consent
Subsidiary;
(f) from time to time, all information and documentation required to
be delivered under Section 4.04 of the Guarantee and Collateral Agreement;
(g) at the time of each delivery of financial statements under
clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower certifying that the requirements of Section 5.08 have been
satisfied in all material respects; and
(h) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any Subsidiary, or compliance with the terms of this Agreement
or the other Credit Documents, or the perfection of the security interests
created by the Security Documents, as the Administrative Agent or any
Lender may reasonably request.
Information required to be delivered pursuant to this Section 5.01
shall be deemed to have been delivered if such information, or one or more
annual or quarterly reports containing such information, shall have been posted
by the Administrative Agent on an IntraLinks or similar site to which the
Lenders have been granted access or shall be available on the website of the
Securities and Exchange Commission at ▇▇▇▇://▇▇▇.▇▇▇.▇▇▇; provided that the
Borrower shall deliver paper copies of such information to any Lender that
requests such delivery. Information required to be delivered pursuant to this
Section 5.01 may also be delivered by electronic communications pursuant to
procedures approved by the Administrative Agent.
SECTION 5.02. Notices of Defaults. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the occurrence of
any Default, together with a statement of a Financial Officer or other executive
officer of the Borrower setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect
thereto.
SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of the Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business, except to the extent that failures to keep in
effect such rights, licenses, permits, privileges and franchises would not be
materially likely, individually or in the aggregate for all such failures, to
result in a Material Adverse Change; provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 6.04.
SECTION 5.04. Maintenance of Properties. The Borrower will, and will
cause each of the Subsidiaries to, keep and maintain all its property in good
working order and condition, ordinary wear and tear excepted, except to the
extent any failure to
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do so would not, individually or in the aggregate, be materially likely to
result in a Material Adverse Change (it being understood that the
foregoing shall not prohibit any sale of any assets permitted by Section
6.06).
SECTION 5.05. Books and Records; Inspection and Audit Rights; Access
Rights. (a) The Borrower will, and will cause each of the Subsidiaries to, keep
books of record and account sufficient to enable the Borrower to prepare the
financial statements and other information required to be delivered under
Section 5.01. The Borrower will, and will cause each of the Subsidiaries to,
permit any representatives designated by the Administrative Agent (or by any
Lender acting through the Administrative Agent), upon reasonable prior notice,
to visit and inspect its properties (accompanied by a representative of the
Borrower) and to discuss its affairs, finances and condition with its officers,
all at such reasonable times and as often as reasonably requested.
(b) The Borrower will, and will cause each of the other Grantors to,
permit any representatives designated by the Administrative Agent (including any
consultants, accountants, lawyers and appraisers retained by the Administrative
Agent) (or by any Lender acting through the Administrative Agent) to conduct
quarterly evaluations and semiannual appraisals of the Borrower's computation of
the Borrowing Base and the assets included in the Borrowing Base (and
information relating to Customer Capital Expenditures) and such other assets and
properties of the Borrower or the Subsidiaries as the Administrative Agent or
Majority Lenders may reasonably require, all at reasonable times and upon
advance notice to the Borrower and, if reasonably requested at any time when
Borrowing Base Availability shall be less than $100,000,000, more often than
quarterly, in the case of evaluations, or semiannually, in the case of
appraisals. The Borrower shall pay the reasonable fees (including reasonable and
customary internally allocated fees and expenses of employees of the
Administrative Agent as to which invoices have been furnished) and expenses of
any third party representatives retained by the Administrative Agent as to which
invoices have been furnished to conduct any such evaluation or appraisal,
including the reasonable fees and expenses associated with collateral monitoring
services performed by the Collateral Agent Services Group of the Administrative
Agent to the extent not otherwise agreed in writing by the Borrower and the
Administrative Agent. To the extent required by the Administrative Agent or the
Majority Lenders in their discretion (not to be exercised unreasonably) as a
result of any such evaluation, appraisal or monitoring, the Borrower also agrees
to modify or adjust the computation of the Borrowing Base (which may include
maintaining additional reserves or modifying the eligibility criteria for the
components of the Borrowing Base, but not modifying the specifically enumerated
advance rates specified in the definition of the "Borrowing Base"). Any such
modification or adjustment required by the Administrative Agent or the Majority
Lenders shall be made by written notice to the Borrower setting forth in
reasonable detail the basis for such modification or adjustment, and shall
become effective for purposes of the first Borrowing Base Certificate that is
delivered pursuant to Section 5.09 at least five Business Days after the date of
receipt by the Borrower of such written notice.
(c) In the event that historical accounting practices, systems or
reserves relating to the components of the Borrowing Base are modified in a
manner that is
65
adverse to the Lenders in any material respect, the Borrower will agree to
maintain such additional reserves (for purposes of computing the Borrowing Base)
in respect of the components of the Borrowing Base and make such other
adjustments to its parameters for including the components of the Borrowing Base
as the Administrative Agent or the Majority Lenders in their discretion (not to
be exercised unreasonably) shall reasonably require based upon such
modifications.
SECTION 5.06. Compliance with Laws. The Borrower will, and will
cause each of the Subsidiaries to, comply with all laws, including Environmental
Laws, rules, regulations and orders of any Governmental Authority applicable to
it or its property, except where the failure to do so, individually or in the
aggregate, would not be materially likely to result in a Material Adverse
Change.
SECTION 5.07. Insurance. The Borrower will, and will cause each of
the Subsidiaries to, maintain, with financially sound and reputable insurance
companies, insurance in such amounts and against such risks as are customary
among companies of established reputation engaged in the same or similar
businesses and operating in the same or similar locations, except to the extent
the failure to do so would not be materially likely to result in a Material
Adverse Change. The Borrower will furnish to the Administrative Agent or any
Lender, upon request, information in reasonable detail as to the insurance so
maintained.
SECTION 5.08. Guarantees and Collateral. (a) In the event that there
shall at any time exist any North American Subsidiary (other than an Excluded
Subsidiary or Consent Subsidiary) that shall not be a party to the Guarantee and
Collateral Agreement or the Canadian Security Agreements, as the case may be,
the Borrower will promptly notify the Collateral Agent (including in such notice
the information that would have been required to be set forth with respect to
such Subsidiary in the Perfection Certificate if such Subsidiary had been one of
the Grantors listed therein) and will, within 30 days (or such longer period as
may be reasonable under the circumstances) after such notification, deliver to
the Collateral Agent a supplement to the Guarantee and Collateral Agreement or
the Canadian Security Agreements, as the case may be, in substantially the form
specified therein, duly executed and delivered on behalf of such North American
Subsidiary, pursuant to which such North American Subsidiary will become a party
to and a Subsidiary Guarantor and, if it elects to become an ABL Facilities
Grantor or if its consolidated assets are greater than $10,000,000 as of
December 31, 2002, or if later, as of the end of the most recent fiscal quarter
for which financial statements have been delivered pursuant to Section 5.01(a)
or (b), an ABL Facilities Grantor, in each case as defined in the Guarantee and
Collateral Agreement.
(b) In the event that the Borrower or any other Grantor shall at any
time own any Material Trademarks (other than Material Trademarks as to which the
actions required by this paragraph have already been taken), the Borrower will
promptly notify the Collateral Agent and will file all Uniform Commercial Code
financing statements or other applicable personal property security law filings
and recordations with the Patent and Trademark Office or the Canadian
Intellectual Property Office as shall be required by law or reasonably requested
by the Collateral Agent to be filed or recorded to perfect the
66
Liens intended to be created on the ABL Facilities Collateral (to the extent
such Liens may be perfected by filings under the Uniform Commercial Code or
other personal property security legislation as in effect in any applicable
jurisdiction or by filings with the United States Patent and Trademark Office or
the Canadian Intellectual Property Office); provided, that if the consents of
Persons other than the Borrower and the Wholly Owned Subsidiaries would be
required under applicable law or the terms of any agreement in order for a
security interest to be created in any Material Trademark under the Guarantee
and Collateral Agreement or the Canadian Security Agreements, as the case may
be, a security interest shall not be required to be created in such Material
Trademark prior to the obtaining of such consents. The Borrower will endeavor in
good faith to obtain any consents required to permit any security interest in
Material Trademarks to be created under the Guarantee and Collateral Agreement
or the Canadian Security Agreements, as the case may be.
(c) The Borrower will, and will cause each Subsidiary to, execute
any and all further documents, financing statements, agreements and instruments,
and take all such further actions, as may be reasonably requested by the
Collateral Agent in order to cause the security interests purported to be
created by the Security Documents or required to be created under the terms of
this Agreement to constitute valid security interests, perfected in accordance
with this Agreement.
(d) During the period of 45 days after the Original Effective Date,
the Borrower will endeavor in good faith to obtain any consents of third parties
required in order for each North American Subsidiary listed on Part II of
Schedule 1.01A to execute the Guarantee and Collateral Agreement as an ABL
Guarantor and, if its consolidated assets are greater than $10,000,000 as of
December 31, 2002, or if later, as of the end of the most recent fiscal quarter
for which financial statements have been delivered pursuant to Section 5.01(a)
or (b), an ABL Facilities Grantor and perform its obligations thereunder and
shall advise the Collateral Agent in writing whether such consents have been
obtained, and if such consents have been obtained, will cause such North
American Subsidiary to execute the Guarantee and Collateral Agreement as
provided in paragraph (a) above.
(e) The Borrower will, as soon as reasonably practicable after the
Restatement Effective Date, cause the Obligations to be secured by (i) Mortgages
(which shall be junior in priority to the Mortgages securing the US Term
Facility Obligations, the US Revolving Facility Obligations and the US
Miscellaneous Obligations, as such terms are defined in the Guarantee and
Collateral Agreement) on all the Mortgaged Properties, with the aggregate amount
of the Indebtedness under this Agreement, the US Term Facility Agreement and the
US Revolving Facility Agreement that is secured by such Mortgaged Properties
being limited to the extent required in order that the Indebtedness under the
Indentures will not be required to be ratably secured, and (ii) perfected
pledges (which shall be junior in priority to the pledges securing the US Term
Facility Obligations, the US Revolving Facility Obligations and the US
Miscellaneous Obligations) of all Equity Interests in Foreign Subsidiaries that
are subject to the US Facilities Foreign Pledge Agreements (as defined in the
Guarantee and Collateral Agreement) or that are pledged under the Luxembourg
Finance Pledge Agreement (as
67
defined in the Guarantee and Collateral Agreement) to secure the US Term
Facility Obligations, the US Revolving Facility Obligations and the US
Miscellaneous Obligations. To the extent the Collateral Agent and the Borrower
so determine, the requirements of this paragraph may be satisfied by the
amendment of existing mortgages and pledge agreements to create the Liens
required to be created hereunder.
SECTION 5.09. Borrowing Base Certificate. (a) The Borrower will
furnish to the Administrative Agent, no later than (a) 15 days following the end
of each fiscal month (or, if such day is not a Business Day, the next succeeding
Business Day), a completed Borrowing Base Certificate showing the Borrowing Base
as of the close of business on the last day of such immediately preceding fiscal
month as outlined in Exhibit E, (b) the third Business Day of each week (or less
frequently if agreed to by the Administrative Agent in its sole discretion), an
interim calculation of Eligible Accounts Receivable as of Saturday of the
immediately preceding week and (c) if requested by the Administrative Agent, at
any other time when the Administrative Agent reasonably believes that the then
existing Borrowing Base Certificate is materially inaccurate, as soon as
reasonably practicable but in no event later than five Business Days after such
request, a completed Borrowing Base Certificate showing the Borrowing Base as of
the date so requested, in each case with such supporting documentation and
additional reports with respect to the Borrowing Base as the Administrative
Agent may reasonably request.
(b) The Borrower will furnish to the Administrative Agent at the
time of each delivery of the Borrowing Base Certificate under clause (a) above
(and in any event not later than 15 days following the end of each fiscal month
(or, if such day is not a Business Day, the next succeeding Business day)), a
certificate of a Financial Officer in the form attached as Annex [ ] to Exhibit
E hereto specifying, to the best of such Financial Officer's knowledge, as of
the date of the information reported in such Borrowing Base Certificate (i) the
aggregate cash and cash equivalents of the Borrower and its Subsidiaries held in
the United States, (ii) the aggregate cash and cash equivalents of the Borrower
and its Subsidiaries held other than in the United States, (iii) for each of
this Agreement, the US Revolving Facility Agreement and the European Facilities
Agreement, the undrawn amount available to be drawn hereunder and thereunder,
respectively, (iv) the aggregate accounts payable position of the Borrower and
the Domestic Subsidiaries and (v) the unearned income on the Borrower's balance
sheet that represents funded Customer Capital Expenditures relating to future
production.
ARTICLE VI
Negative Covenants
Until the Commitments shall have expired or terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:
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SECTION 6.01. Indebtedness and Preferred Equity Interests. The
Borrower will not, and will not permit any Consolidated Subsidiary to, create,
incur, assume or permit to exist any Indebtedness, or issue any preferred stock
or other preferred Equity Interests, except:
(a) Indebtedness under this Agreement (and related Indebtedness
under the Security Documents);
(b) Indebtedness under the other New Facilities Credit Agreements
(and related Indebtedness under the Security Documents) in an amount for
each New Facilities Credit Agreement not greater than the aggregate amount
of the outstanding loans and unfunded commitments of the lenders
thereunder on the Original Effective Date; provided, that the amount of
Indebtedness permitted by this paragraph or any other paragraph of this
Section to exist under the US Term Facility Agreement and the US Revolving
Facility Agreement shall be reduced (i) in the case of the US Term
Facility Agreement, by the aggregate amount of all prepayments of the
loans outstanding thereunder and (ii) in the case of the US Revolving
Facility Agreement, by the aggregate amount of all permanent reductions of
the commitments thereunder (it being agreed, however, that up to
$250,000,000 of Indebtedness under the US Revolving Facility Agreement in
the form of cash-collateralized letters of credit will in any event be
permitted);
(c) other Indebtedness existing (or incurred pursuant to commitments
to lend existing) on March 31, 2003, substantially all of which is set
forth or described in Schedule 6.01 (as such Schedule 6.01 shall be
modified in connection with the delivery of financial statements in
respect of the fiscal period ended on March 31, 2003);
(d) Indebtedness owed to the Borrower or any Subsidiary and
permitted under Section 6.05(b);
(e) Guarantees expressly permitted under Section 6.05;
(f) Indebtedness of Foreign Subsidiaries (other than the European JV
and its subsidiaries and Luxembourg Finance (it being understood that
Indebtedness of Goodyear S.A., organized under the laws of Luxembourg,
existing on the date hereof shall be counted against the limitation set
forth in this Section 6.01(f) from and after the date on which it becomes
secured)) in an aggregate principal amount (excluding Indebtedness
existing or incurred under the other clauses of this Section 6.01 and
under Section 6.05(b)) not greater than $200,000,000 outstanding at any
time;
(g) Securitization Transactions (other than those permitted by
paragraphs (f), (j), (l), (r) and (u) of this Section) in an aggregate
amount not greater than (euro)275,000,000 outstanding at any time;
(h) Indebtedness of the Borrower or any Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or
capital assets, including
69
Capital Lease Obligations and any Indebtedness assumed in connection with
the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof; provided that such Indebtedness is
incurred prior to or within 180 days after such acquisition or the
completion of such construction or improvement;
(i) Attributable Debt of the Borrower or any Subsidiary incurred
pursuant to Sale and Leaseback Transactions permitted by Section 6.03;
(j) Indebtedness of any Person that becomes a Subsidiary after the
date hereof as a result of a transaction expressly permitted under Section
6.05(e); provided that such Indebtedness exists at the time such Person
becomes a Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary;
(k) obligations of the Borrower and the Subsidiaries existing on the
date hereof (other than Guarantees, Securitization Transactions and Sale
and Leaseback Transactions) that would not constitute Indebtedness that
would appear as liabilities on a consolidated balance sheet of the
Borrower under GAAP as in effect on the date hereof and that, as a result
of changes in GAAP after the date hereof, shall be required to be
reflected on such a balance sheet as liabilities;
(l) Indebtedness of any Subsidiary that is not a Consolidated
Subsidiary under GAAP as in effect on the date hereof (and in the event
that any such Subsidiary shall become a Consolidated Subsidiary,
Indebtedness of such Subsidiary existing at the time it becomes a
Consolidated Subsidiary);
(m) any extension, renewal, refinancing or replacement of any
Indebtedness referred to in any of clauses (a) through (l) above that does
not increase the outstanding principal amount thereof (except to the
extent necessary to pay the fees, expenses, underwriting discounts and
prepayment premiums in connection therewith) or change the parties
directly or indirectly responsible for the payment of such Indebtedness;
provided that (i) any such refinancing or replacement Indebtedness shall
not shorten the maturity of the Indebtedness refinanced or replaced or add
a requirement not previously applicable to the Indebtedness refinanced or
replaced that such Indebtedness be prepaid, redeemed, repurchased or
defeased on one or more scheduled dates or upon the happening of one or
more events (other than events of default or change of control events)
before the maturity of the Indebtedness refinanced or replaced and (ii)
any such refinancing or replacement of Indebtedness under any revolving
credit or similar facility shall be accompanied by the termination of the
portion of the commitments under such facility under which such refinanced
or replaced Indebtedness shall have been outstanding;
(n) Indebtedness arising from the honoring of a check, draft or
similar instrument presented by the Borrower or a Subsidiary against
insufficient funds;
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(o) Indebtedness pursuant to any Swap Agreement entered into to
hedge against risks to which the businesses of the Borrower and the
Subsidiaries are exposed, and not for speculative purposes;
(p) unsecured surety and performance bonds entered into in the
ordinary course of business and not securing Indebtedness;
(q) other unsecured Indebtedness for borrowed money of the Borrower,
or preferred Equity Interests of the Borrower ("Permitted Preferred
Stock"), or any combination thereof, not maturing or required to be
prepaid, redeemed, repurchased or defeased prior to the Maturity Date,
whether on one or more scheduled dates or upon the happening of one or
more events (other than events of default (or similar events relating to
Equity Interests) or change of control events), and any Guarantee of such
Indebtedness provided by any Subsidiary that is a US Guarantor under the
Guarantee and Collateral Agreement that is subordinated to the Obligations
on terms in no material respect less favorable to the Lenders than market
terms prevailing at the time such Guarantee is issued; provided that the
aggregate principal or stated amount of such Indebtedness (or of the
Indebtedness it Guarantees) or preferred Equity Interests created or
assumed pursuant to this clause (q) and outstanding at any time, without
duplication, shall not exceed $1,000,000,000; provided further, that for
purposes of this paragraph, any trust preferred stock or similar preferred
Equity Interest issued by a special purpose entity substantially all the
assets of which consist of Indebtedness or preferred Equity Interests of
the Borrower will be deemed to be a preferred Equity Interest of the
Borrower;
(r) a Securitization Transaction in an aggregate amount not greater
than $15,000,000 outstanding at any time involving accounts receivable,
rights to future lease payments or residuals or other financial assets,
and related property of Goodyear Australia Pty Limited;
(s) Senior Subordinated-Lien Indebtedness for borrowed money of the
Borrower not maturing or required to be prepaid, redeemed, repurchased or
defeased prior to the Maturity Date, whether on one or more scheduled
dates or upon the happening of one or more events (other than as a result
of events of default or change of control events or pursuant to customary
provisions requiring that the Borrower offer to purchase such Senior
Subordinated-Lien Indebtedness with the proceeds of asset sales to the
extent such proceeds have not been invested in assets used in the
Borrower's business or used to prepay, redeem or purchase other
Indebtedness (including Loans hereunder and Loans under and as defined in
the US Term Facility Agreement) or to provide cash collateral for
reimbursement obligations in respect of letters of credit (including the
Letters of Credit under and as defined in the US Revolving Facility
Agreement)) (it being agreed that provisions comparable to those set forth
in Exhibit H hereto are customary), and related Guarantees by the
Subsidiary Guarantors; provided that (i) the Borrower shall substantially
concurrently make any prepayments, deposits of cash collateral to secure
reimbursement obligations in respect of Letters of Credit (as defined in
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the US Revolving Facility Agreement) and reductions of Regular Way
Commitments and Commitments (as defined in the US Revolving Facility
Agreement) required in connection with the issuance of such Senior
Subordinated-Lien Indebtedness under the US Term Facility Agreement and
the US Revolving Facility Agreement, (ii) the Senior Subordinated-Lien
Collateral Agent for such Senior Subordinated-Lien Indebtedness shall have
executed and delivered to the Administrative Agent, on its own behalf and
on behalf of the obligees on such Senior Subordinated-Lien Indebtedness,
the Lien Subordination and Intercreditor Agreement, and (iii) after no
Loans or Regular Way Commitments are outstanding under the US Term
Facility Agreement and or the US Revolving Facility Agreement, the portion
of the Net Cash Proceeds of such Senior Subordinated-Lien Indebtedness in
excess of required prepayments under the US Term Facility Agreement and
Commitment reductions and Regular Way Commitment reductions under the US
Revolving Facility Agreement shall, except to the extent a like amount of
Net Cash Proceeds of Senior Subordinated-Lien Indebtedness shall have been
so applied prior to the time at which all amounts outstanding under the US
Term Facility Agreement and the US Revolving Facility Agreement shall have
been prepaid and the Regular Way Commitments under the US Revolving
Facility Agreement shall have been reduced to zero, be applied, within 180
days after the receipt by the Borrower of such Net Cash Proceeds, solely
(A) to prepay Loans under and as defined in the New Facilities Credit
Agreements (it being agreed that at the time of any such prepayment of
revolving loans the related commitments will be reduced by the amount of
such prepayment), (B) to repurchase, repay or prepay Designated Debt or
(C) to make reasonably anticipated required contributions to Plans of the
Borrower and the Subsidiaries;
(t) Securitization Transactions of Foreign Subsidiaries (other than
those permitted by paragraphs (f), (g), (j), (l) and (r) of this Section)
in an aggregate amount not greater than $15,000,000 outstanding at any
time; and
(u) other Indebtedness in an aggregate amount at any time
outstanding not to exceed $25,000,000.
SECTION 6.02. Liens. The Borrower will not, and will not permit any
Consolidated Subsidiary to, create, incur, assume or permit to exist any Lien on
any property or asset now owned or hereafter acquired by it, or assign or sell
any income or revenues (including accounts receivable) or rights in respect of
any thereof (other than sales of delinquent or doubtful receivables and other
than any transaction excluded from the definition of "Securitization
Transaction" under the proviso thereto), except:
(a) Liens created under the New Facilities Documents;
(b) Permitted Encumbrances;
(c) any Lien on any property or asset of the Borrower or any
Subsidiary existing on the Original Effective Date and set forth in
Schedule 6.02; provided
72
that (i) such Lien shall not apply to any other property or asset of the
Borrower or any Subsidiary and (ii) such Lien shall secure only those
obligations which it secured on the Original Effective Date and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(d) any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date
hereof prior to the time such Person becomes a Subsidiary; provided that
(i) such Lien secures Indebtedness permitted by clause (h) or (j) of
Section 6.01, (ii) such Lien is not created in contemplation of or in
connection with such acquisition or such Person becoming a Subsidiary, as
the case may be, (iii) such Lien shall not apply to any other property or
assets of the Borrower or any Subsidiary, and (iv) such Lien shall secure
only those obligations which it secures on the date of such acquisition or
the date such Person becomes a Subsidiary, as the case may be, and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(e) Liens on assets acquired, constructed or improved by the
Borrower or any Subsidiary; provided that (i) such Liens secure
Indebtedness permitted by clause (h) or (j) of Section 6.01, (ii) such
Liens and the Indebtedness secured thereby are incurred prior to or within
180 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed the
cost of acquiring, constructing or improving such assets and (iv) such
Liens shall not apply to any other property or assets of the Borrower or
any Subsidiary;
(f) Liens on assets of Foreign Subsidiaries (other than the European
JV and its subsidiaries and Luxembourg Finance) securing Indebtedness
incurred under Section 6.01(f), and (ii) in connection with Securitization
Transactions permitted under Section 6.01(f) or (s);
(g) Liens in connection with Securitization Transactions permitted
under Section 6.01(g) and (r);
(h) Liens in connection with Sale and Leaseback Transactions
permitted by Section 6.03;
(i) Liens on specific items of inventory or other goods (and
proceeds thereof) securing obligations in respect of bankers' acceptances
issued for the account of the Borrower or a Subsidiary to facilitate the
purchase, shipment or storage of such items of inventory or other goods;
(j) Liens on specific items of inventory or other goods and related
documentation (and proceeds thereof) securing reimbursement obligations in
respect of trade letters of credit issued to ensure payment of the
purchase price for such items of inventory or other goods;
73
(k) any interest of a lessor in property subject to an operating
lease;
(l) Liens referred to in policies of title insurance with respect to
Mortgaged Property delivered to the Administrative Agent prior to the
Original Effective Date;
(m) Liens on assets constituting ABL Facilities Collateral, US
Facilities Pledged Collateral, Luxembourg Finance Pledged Collateral and
US Facilities Article 9 Collateral (other than any such US Facilities
Article 9 Collateral constituting Indenture Properties or "manufacturing
facilities", as defined in the Swiss Franc Note Agreement) (each such term
not defined in this Agreement having the meaning assigned to it in the
Guarantee and Collateral Agreement), and on the Borrower's headquarters
building in Akron, Ohio, created under any Senior Subordinated-Lien
Security Documents to secure any Senior Subordinated-Lien Indebtedness
incurred under Section 6.01(s); provided, that such Liens shall be
subordinate and junior to the Liens securing the Obligations on the terms
set forth in the Lien Subordination and Intercreditor Agreement;
(n) Liens on assets constituting US Facilities Pledged Collateral
and US Facilities Article 9 Collateral (other than any such US Facilities
Article 9 Collateral constituting Indenture Properties or "manufacturing
facilities", as defined in the Swiss Franc Note Agreement), and on the
Borrower's headquarters building in Akron, Ohio, securing Indebtedness
incurred under Section 6.01(m) to refinance the Indebtedness under the US
Term Facility Agreement or the US Revolving Facility Agreement, but only
if (i) all Indebtedness under both the US Term Facility Agreement and the
US Revolving Facility Agreement shall have been repaid in full and the
Commitments under and as defined in the US Revolving Facility Agreement
shall have been terminated not later than the time at which such Liens are
incurred and (ii) such Liens secure Indebtedness in an amount not greater
than the amount of the Indebtedness under the US Term Facility Agreement
and/or the US Revolving Facility Agreement repaid with the proceeds of
such Indebtedness;
(o) Liens on assets constituting European Facilities Collateral and
Luxembourg Finance Pledged Collateral (each such term not defined in this
Agreement having the meaning assigned to it in the Guarantee and
Collateral Agreement) securing Indebtedness incurred under Section 6.01(m)
to refinance the Indebtedness under the European Facilities Agreement, but
only if all Indebtedness under the European Facilities Agreement shall
have been repaid in full and the Commitments under and as defined in the
European Facilities Agreement shall have been terminated not later than
the time at which such Liens are incurred;
(p) at the time of and after the initial incurrence, issuance or
sale of Senior Subordinated-Lien Indebtedness, Liens on assets
constituting ABL Facilities Collateral, US Facilities Pledged Collateral,
Luxembourg Finance Pledged Collateral and US Facilities
74
Article 9 Collateral (other than any such US Facilities Article 9
Collateral constituting Indenture Properties or "manufacturing
facilities", as defined in the Swiss Franc Note Agreement) (each such term
not defined in this Agreement having the meaning assigned to it in the
Guarantee and Collateral Agreement), and on the Borrower's headquarters
building in Akron, Ohio, to secure the Guarantees by the Borrower and the
Subsidiary Guarantors of the Obligations under and as defined in the
European Facilities Agreement (or of Indebtedness incurred under Section
6.01(m) to refinance the Indebtedness under the European Facilities
Agreement, but only if all Indebtedness under the European Facilities
Agreement shall have been repaid in full and the Commitments under and as
defined in the European Facilities Agreement shall have been terminated
not later than the time at which such Liens are incurred); provided that
such Liens shall be pari passu with the Liens securing Senior
Subordinated-Lien Indebtedness and subordinate to the other Liens on such
Collateral created by the Guarantee and Collateral Agreement; and
(q) other Liens on assets not constituting Collateral; provided that
the aggregate amount of the Indebtedness and other obligations secured by
such Liens shall at no time exceed $25,000,000.
SECTION 6.03. Sale and Leaseback Transactions. The Borrower will
not, and will not permit any of the Consolidated Subsidiaries to, enter into or
be party to any Sale and Leaseback Transaction other than (a) Sale and Leaseback
Transactions existing on the date hereof and any replacement Sale and Leaseback
Transactions that do not involve assets other than those subject to the Sale and
Leaseback Transactions they replace and do not increase the Attributable Debt
related thereto and (b) other Sale and Leaseback Transactions the aggregate
outstanding Attributable Debt in respect of which does not exceed $125,000,000.
SECTION 6.04. Fundamental Changes. The Borrower will not, and will
not permit any Subsidiary to, merge into or consolidate with any other Person,
or permit any other Person to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) assets (including capital stock of Subsidiaries) constituting all
or substantially all the assets of the Borrower and its Consolidated
Subsidiaries, taken as a whole, or, in the case of the Borrower, liquidate or
dissolve, except that, if at the time thereof and immediately after giving
effect thereto no Default shall have occurred and be continuing (i) any
Subsidiary may merge into the Borrower in a transaction in which the Borrower is
the surviving corporation, (ii) any Subsidiary may merge into any other
Subsidiary in a transaction in which the surviving entity is a Subsidiary;
except that no Domestic Subsidiary may merge into a Foreign Subsidiary, (iii)
any sale of a Subsidiary made in accordance with Section 6.06 may be effected by
a merger of such Subsidiary and (iv) any Subsidiary may sell, transfer, lease or
otherwise dispose of its assets to the Borrower or to another Subsidiary;
provided that any Investment that takes the form of a merger or consolidation
(other than any merger or consolidation involving the Borrower) that is
expressly permitted by Section 6.05 shall be permitted under this Section 6.04.
75
SECTION 6.05. Investments, Loans, Advances and Guarantees. The
Borrower will not, and will not permit any of the Consolidated Subsidiaries to,
purchase or acquire (including pursuant to any merger with any Person that was
not a Wholly Owned Subsidiary prior to such merger) any capital stock, evidences
of Indebtedness or securities (including any option, warrant or other right to
acquire any of the foregoing) of, make any loans or advances to, make any
Guarantee of any obligations of, or make any investment in, any other Person, or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit (each of the
foregoing, an "Investment" in such Person), except:
(a) Permitted Investments;
(b) Investments by the Borrower and the Subsidiaries in Subsidiaries
or the Borrower; provided that no Investment shall made by any Credit
Party in a Subsidiary that is not a Credit Party pursuant to this clause
(b) except (i) Investments (A) to fund working capital needs of such
Subsidiary, (B) to replace amounts available under credit facilities or
other financings of such Subsidiary existing on the date hereof that shall
have matured or shall have been terminated or reduced, (C) to cover losses
from operations of such Subsidiary and (D) to provide funds for Capital
Expenditures or acquisitions permitted to be made by such Subsidiary;
provided further, that Equity Interests in the European JV or any
subsidiary thereof may not be transferred to any Subsidiary that is not
the European JV or any subsidiary thereof;
(c) any Investment by a Credit Party in a Consolidated Subsidiary
that is not a Credit Party in the form of a transfer of assets used in or
directly relating to any manufacturing process (but excluding any cash or
financial asset) from a jurisdiction having higher manufacturing costs to
a jurisdiction having lower manufacturing costs; provided that the
aggregate book value of all assets subject to all such transfers from and
after the Original Effective Date shall not exceed $250,000,000; and any
Investment by Goodyear Dunlop Tires NA in a Consolidated Subsidiary;
(d) Guarantees expressly permitted under Section 6.01;
(e) on or after June 30, 2003, the acquisition of any Equity
Interest; provided that the aggregate consideration paid by the Borrower
and the Subsidiaries in all such acquisitions (including Indebtedness
assumed by the Borrower or any Subsidiary) shall not exceed $100,000,000
plus the aggregate Net Cash Proceeds from Prepayment Events or
incurrences, issuances or sales of Senior Subordinated-Lien Indebtedness
after the date hereof that (i) shall not have been required to be applied
to reduce commitments, prepay loans and/or cash collateralize
reimbursement obligations in respect of letters of credit under any of the
New Facilities Credit Agreements, and (ii) shall not have been used (and
shall not be required to be used) (A) to make Capital Expenditures that
would otherwise have been prohibited by Section 6.08 or (B) to repurchase,
repay or prepay Designated Debt;
76
(f) Guarantees not permitted by any other clause of this Section
6.05 incurred in the ordinary course of business and consistent with past
practice in an aggregate amount for all such Guarantees at any time
outstanding not exceeding $50,000,000;
(g) Investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(h) Investments for consideration consisting solely of common stock
of the Borrower;
(i) Equity Interests and debt obligations obtained by the Borrower
or any Subsidiary as consideration for any asset sale permitted under
Section 6.06;
(j) Investments in Persons in which the Borrower or any Subsidiary
has an Equity Interest on the date hereof, including Wingfoot Commercial
Tire Systems LLC, SAVA Tires Joint Venture Holding d.o.o. and South
Pacific Tyres that are (i) required to be made as a result of the exercise
by other holders of Equity Interests in such joint ventures of put options
or (ii) required to avoid dilution of the Borrower's or such Subsidiary's
percentage ownership interest therein and in an aggregate amount not
greater than $200,000,000 during the term of this Agreement;
(k) Investments that are included in Capital Expenditures for the
respective periods during which such Investments are made and that are
permitted under Section 6.08;
(l) the purchase of Equity Interests in Sava Joint Venture Holding
d.o.o.;
(m) loans and advances to officers and employees of the Borrower and
its Subsidiaries in the ordinary course of business;
(n) Investments in prepaid expenses in the ordinary course of
business or in respect of required pension fund contributions;
(o) negotiable instruments held for collection and lease, utility,
workers' compensation, performance and other similar deposits in the
ordinary course of business;
(p) Investments in any Subsidiary that engages in no activities
other than those related to a Securitization Transaction in order to
capitalize such Subsidiary at a level customary for a securitization
vehicle in such a transaction;
(q) Investments constituting loans or advances by the European JV or
any J.V. Subsidiary (as defined in the European Facilities Agreement) to
the Borrower or any of its Subsidiaries (other than the European JV, its
Subsidiaries and Luxembourg Finance) as part of cash management consistent
with past practices
77
in an aggregate amount for all such Investments at any time outstanding
not exceeding $75,000,000, other than Investments the proceeds of which
are used (i) to repay loans under the US Term Facility Agreement or (ii)
if there are no outstanding loans under the US Term Facility Agreement, to
reduce commitments under the US Revolving Facility in an amount equal to
such Investments;
(r) Investments of the proceeds of any Securitization Transaction
under Section 6.01(r) in South Pacific Tyres; and
(s) Investments not permitted by any other clause of this Section in
an aggregate amount at any time outstanding not greater than $25,000,000.
SECTION 6.06. Asset Dispositions. The Borrower will not, and will
not permit any of the Consolidated Subsidiaries to, sell, transfer, lease or
otherwise dispose of (each a "Sale") any asset, including any Equity Interest,
owned by it, nor will the Borrower permit any of the Subsidiaries to issue any
additional Equity Interest in such Subsidiary, except:
(a) Sales in the ordinary course of business of inventory and worn
out or surplus equipment and Permitted Investments, and Sales in the
ordinary course of business and consistent with past practices of assets
other than property, plant, Investments in Subsidiaries and Intellectual
Property; provided that licensing of Intellectual Property in the ordinary
course of business and consistent with past practices shall be permitted;
(b) Sales to the Borrower or a Subsidiary; provided that any such
sale, transfer or disposition by a Credit Party to a Subsidiary that is
not a Credit Party shall be made in compliance with Section 6.05;
(c) the Sale of Equity Interests in Sava Joint Venture Holding
d.o.o. to the European JV or any Subsidiary thereof (and any sale of such
Equity Interests to the Borrower in connection therewith);
(d) Sales of accounts receivable or interests therein in
Securitization Transactions permitted under Sections 6.01(g) and (r);
(e) Sales of assets in Sale and Leaseback Transactions permitted
under Section 6.03;
(f) Sales of any Equity Interests in any Person that is not a
Subsidiary;
(g) Sales to Persons other than the Borrower or any Subsidiary of
assets listed on Schedule 6.06; provided that (i) at least 50% of the
consideration received in each such Sale of the assets listed on Part I of
Schedule 6.06 shall consist of cash and (ii) at least 75% of the
consideration received in each other such Sale listed on Part II of
Schedule 6.06 shall consist of cash;
78
(h) Sales to the extent the aggregate value of the consideration
received in any such Sale or series of related Sales does not exceed
$10,000,000;
(i) Investments expressly permitted by Section 6.05; and
(j) Sales (other than Sales of accounts receivable or inventory)
that are not permitted by any other clause of this Section 6.06; provided
that (i) the aggregate consideration received in respect of all such Sales
in reliance upon this clause (j) shall not exceed $300,000,000 in the
aggregate, (ii) all Sales permitted pursuant to this clause (j) shall be
made for fair value, as reasonably determined by the Borrower, and (iii)
at least 75% of the consideration received in each such Sale shall consist
of cash.
SECTION 6.07. Restricted Payments. (a) The Borrower will not, and
will not permit any of the Subsidiaries to, declare or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, except that (i) the
Borrower may declare and pay dividends payable solely in additional shares of
its common stock, (ii) so long as no Event of Default shall exist, the Borrower
may declare and pay cash dividends and other regularly scheduled distributions
on shares of its Permitted Preferred Stock, (iii) Subsidiaries may make
Restricted Payments ratably with respect to any class of their respective Equity
Interests, (iv) the Borrower may make Restricted Payments pursuant to and in
accordance with stock option or rights plans or other benefit plans for
management, employees, directors or consultants of the Borrower or any
Subsidiary and (v) the Borrower and its Subsidiaries may make Investments
expressly permitted under Section 6.05(j).
(b) The Borrower will not, nor will it permit any of the
Subsidiaries to, make or agree to make, directly or indirectly, any payment or
other distribution (whether in cash, securities or other property), except
payments or distributions made in common stock of the Borrower, to any Person
other than the Borrower or a Subsidiary in respect of principal of or interest
on any Indebtedness, or any payment or other distribution (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, defeasance, acquisition,
cancelation or termination of any Indebtedness of the Borrower or any
Subsidiary, except:
(i) payments and prepayments under this Agreement (ratably in
accordance with the Commitments of the Lenders) and the other New
Facilities Credit Agreements;
(ii) regularly scheduled and other mandatory interest and principal
payments (including pursuant to sinking fund requirements) as and when due
in respect of any Indebtedness;
(iii) refinancings of Indebtedness to the extent permitted by
Section 6.01(m), including the payment of customary fees, costs and
expenses in connection therewith, and including additional cash payments
in an aggregate
79
amount for all such refinancings not to exceed, in the case of any
refinancing, 5% of the principal amount being refinanced;
(iv) the payment of secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets
securing such Indebtedness;
(v) if the Loans under and as defined in the US Term Facility
Agreement shall have been repaid in full and no Event of Default shall
exist, repurchases, repayments or prepayments of Designated Debt in an
aggregate amount not greater than the portion of the aggregate Net Cash
Proceeds from the issuance and sale of Senior Subordinated-Lien
Indebtedness not required to be applied to reduce commitments, prepay
loans and/or cash collateralize reimbursement obligations in respect of
letters of credit under the US Revolving Facility Agreement or the US Term
Facility Agreement, but only to the extent that such portion of such Net
Cash Proceeds shall not have been used (A) to make Capital Expenditures
that would have been prohibited by Section 6.08 but for the receipt of
such Net Cash Proceeds or (B) to acquire Equity Interests pursuant to
Section 6.05(e); and
(vi) if no Event of Default shall exist, repurchases, repayments or
prepayments of Designated Debt in an aggregate amount not greater than the
portion of the aggregate Net Cash Proceeds of securities issued and sold
pursuant to Section 6.01(q) not required to be applied to prepay loans
under the US Term Facility Agreement, but only to the extent that such
portion of such Net Cash Proceeds shall not have been used (A) to make
Capital Expenditures that would have been prohibited by Section 6.08 but
for the receipt of such Net Cash Proceeds or (B) to acquire Equity
Interests pursuant to Section 6.05(e).
SECTION 6.08. Capital Expenditures. The Borrower and the
Subsidiaries will not make Capital Expenditures in any period set forth below in
an amount greater than (a) the sum of (i) the amount set forth below for such
period and each prior period plus (ii) that portion of the aggregate Net Cash
Proceeds from Prepayment Events or incurrences, issuances or sales of Senior
Subordinated-Lien Indebtedness after the date hereof that shall not have been
required to be applied to prepay loans or cash collateralize letters of credit
under any of the New Facilities Credit Agreements (and shall not have been used
(A) to make Investments under Section 6.05(e) in excess of the $100,000,000
limitation set forth therein or (B) to repurchase, repay or prepay Designated
Debt) minus (b) the aggregate amount of Capital Expenditures made during any
prior period set forth below:
Period Capital Expenditure Amount
------ --------------------------
1/1/03 through 12/31/03 $360,000,000
1/1/04 through 12/31/04 $500,000,000
1/1/05 through 12/31/05 $500,000,000
1/1/06 through 3/31/06 $150,000,000
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SECTION 6.09. Interest Expense Coverage Ratio. The Borrower will not
permit the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Expense
for any period of four consecutive fiscal quarters to be less than 2.25 to 1.00
or, at any time after the Borrower shall have received gross cash proceeds of at
least $500,000,000 from issuances and sales after the First Amendment Date of
Senior Subordinated-Lien Indebtedness, 2.00 to 1.00.
SECTION 6.10. Consolidated Net Worth. The Borrower will not permit
Consolidated Net Worth at the end of any fiscal quarter to be less than the
amount set forth below for such date.
Fiscal Quarter Ending Minimum Amount
--------------------- --------------
March 31, 2003 2,800,000,000
June 30, 2003 2,800,000,000
September 30, 2003 2,800,000,000
December 31, 2003 2,800,000,000
March 31, 2004 2,500,000,000
June 30, 2004 2,500,000,000
September 30, 2004 2,500,000,000
December 31, 2004 2,500,000,000
March 31, 2005 2,000,000,000
June 30, 2005 2,000,000,000
September 30, 2005 2,000,000,000
December 31, 2005 2,000,000,000
March 31, 2006 2,000,000,000
SECTION 6.11. Senior Secured Indebtedness Ratio. The Borrower will
not at any date permit the ratio of (a) Consolidated Senior Secured Indebtedness
at such date to (b) Consolidated EBITDA for the most recent period of four
consecutive fiscal quarters for which financial statements have been delivered
pursuant to Section 5.01(a) or (b), to be greater than 4.00 to 1.00.
ARTICLE VII
Events of Default; Inter-Tranche Agreements With Respect to Collateral
SECTION 7.01. Events of Default. If any of the following events
("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the
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same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or any other Credit Document,
when and as the same shall become due and payable, and such failure shall
continue unremedied for a period of (i) in the case of fees and interest
payable under Sections 2.10 and 2.11, respectively, five Business Days,
and (ii) in the case of any other fees, interest or other amounts (other
than those referred to in paragraph (a) above), five Business Days after
the earlier of (A) the day on which a Financial Officer first obtains
knowledge of such failure and (B) the day on which written notice of such
failure shall have been given to the Borrower by the Administrative Agent
or any Lender;
(c) any representation or warranty made or deemed made by or on
behalf of any Credit Party in any Credit Document or any amendment or
modification thereof or waiver thereunder shall prove to have been
incorrect when made or deemed made in any respect material to the rights
or interests of the Lenders under the Credit Documents;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02, 5.03 (with respect to
the Borrower's existence) or 5.08 or in Article VI;
(e) any Credit Party shall fail to observe or perform any covenant,
condition or agreement contained in any Credit Document (other than those
specified in clauses (a), (b) and (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after written notice
thereof from the Administrative Agent to the Borrower (which notice will
be given at the request of any Lender); provided, that the failure of any
Credit Party to perform any covenant, condition or agreement made in any
Credit Document (other than this Agreement) shall not constitute an Event
of Default unless such failure shall be (i) wilful or (ii) material to the
rights or interests of the Lenders under the Credit Documents;
(f) the Borrower or any Consolidated Subsidiary shall fail to make
any payment of principal in respect of any Material Indebtedness at the
scheduled due date thereof and such failure shall continue beyond any
applicable grace period, or any event or condition occurs that results in
any Material Indebtedness (other than any Securitization Transaction
existing on the date hereof) becoming due or being required to be prepaid,
repurchased, redeemed, defeased or terminated prior to its scheduled
maturity; provided that this clause (f) shall not apply to (i) secured
Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness in
accordance with the terms and conditions of this Agreement or (ii)
Material Indebtedness of any Foreign Subsidiary if the Borrower is unable,
due to applicable law restricting Investments
82
in such Foreign Subsidiary, to make an Investment in such Foreign
Subsidiary to fund the payment of such Material Indebtedness;
(g) any event or condition occurs that continues beyond any
applicable grace period and enables or permits the holder or holders of
any Material Indebtedness (other than (i) any Securitization Transaction
existing on the date hereof and (ii) any Material Indebtedness of any
Foreign Subsidiary in an aggregate principal amount that is less than
$50,000,000) or any trustee or agent on its or their behalf to cause such
Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption, defeasance or termination thereof, prior to its
scheduled maturity; provided, that this clause (g) shall not apply to (i)
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness in
accordance with the terms and conditions of this Agreement or (ii)
Material Indebtedness of any Foreign Subsidiary if the Borrower is unable,
due to applicable law restricting Investments in such Foreign Subsidiary,
to make an Investment in such Foreign Subsidiary to fund the payment of
such Material Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any Material Subsidiary or its debts,
or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower
or any Material Subsidiary or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue undismissed
for 90 days or an order or decree approving or ordering any of the
foregoing shall be entered;
(i) the Borrower or any Material Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or petition described in clause (h)
of this Article, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Material Subsidiary or for a substantial
part of its assets, (iv) make a general assignment for the benefit of
creditors or (v) take any action for the purpose of effecting any of the
foregoing;
(j) the Borrower or any Material Subsidiary shall admit in writing
its inability or fail generally to pay its debts as they become due;
(k) an ERISA Event shall have occurred that, when taken together
with all other ERISA Events that have occurred, would be materially likely
to result in a Material Adverse Change;
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(l) Liens created under the Security Documents shall not be valid
and perfected Liens on a material portion of the Collateral;
(m) any Guarantee of the Obligations under the Guarantee and
Collateral Agreement shall fail to be a valid, binding and enforceable
Guarantee of one or more Subsidiary Guarantors where such failure would
constitute or be materially likely to result in a Material Adverse Change;
or
(n) a Change in Control shall occur;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Majority Lenders or the Majority Borrowing Base Lenders shall, by
notice to the Borrower, take any or all of the following actions, at the same or
different times: (i) terminate the Commitments, and thereupon the Commitments
shall terminate immediately and (ii) declare the Loans then outstanding to be
due and payable in whole (or in part, in which case any principal not so
declared to be due and payable may thereafter be declared to be due and
payable), and thereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate, the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, in each case without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower.
SECTION 7.02. Inter-Tranche Agreements With Respect to Collateral.
(a) Under the Guarantee and Collateral Agreement and the other Security
Documents, the Tranche A Term Obligations and Revolving Obligations on the one
hand, and the Tranche B Term Obligations on the other hand, are secured by first
priority Liens and second priority Liens, respectively, on the ABL Collateral
(such term and each other capitalized term used in this Section and not defined
in Section 1.01 having the meaning specified in the Guarantee and Collateral
Agreement) and are or will be secured by second priority Liens and third
priority Liens, respectively, on the US Facilities Pledged Collateral, the US
Facilities Article 9 Collateral, the Mortgaged Properties and certain Equity
Interests in Luxembourg Finance. The Tranche B Term Lenders hereby agree, for
the benefit of the Tranche A Term Lenders and the Revolving Lenders, that
notwithstanding any other provision of this Agreement, or any other Security
Document, the rights of the Tranche B Term Lenders in the Collateral and any
Proceeds thereof shall be subordinate and junior to the rights of the Tranche A
Term Lenders and the Revolving Lenders in such Collateral and Proceeds. In
furtherance of the foregoing, (i) any amounts distributed in respect of the
Obligations (other than Obligations owed to the Administrative Agent or the
Collateral Agent) pursuant to Section 6.03 of the Guarantee and Collateral
Agreement or pursuant to any other Security Document shall be applied
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first to pay the Tranche A Term Obligations and the Revolving Obligations,
ratably in accordance with the respective amounts thereof, until all such
Tranche A Term Obligations and Revolving Obligations shall have been paid in
full, and thereafter shall be applied to pay the Tranche B Obligations, and (ii)
with respect to the Collateral, any Proceeds thereof, the Liens thereon securing
the Obligations and all related matters, the relative rights and obligations of
the Tranche A Term Lenders and the Revolving Lenders on the one hand, and the
Tranche B Term Lenders on the other hand, shall be as set forth in Sections
11.01 and 11.02 of the Guarantee and Collateral Agreement, which for purposes of
this Section shall be deemed to be incorporated by reference in this paragraph,
mutatis mutandis, it being agreed that for purposes of such Sections as so
incorporated (A) the Liens securing the Tranche A Term Obligations and the
Revolving Obligations on the one hand, and the Tranche B Term Obligations on the
other hand, are separate Liens, (B) the Liens securing the Tranche A Term
Obligations and the Revolving Obligations are Senior Liens in respect of the
Collateral and Applicable Senior Liens in respect of the Liens securing the
Tranche B Term Obligations, (C) the Tranche A Term Obligations and the Revolving
Obligations are Applicable Senior Obligations in respect of the Tranche B Term
Obligations, (D) the Liens securing the Tranche B Term Obligations are Junior
Liens in respect of the Collateral and (E) the references in Sections 11.01 and
11.02 to the Collateral Agent shall be deemed to include the Administrative
Agent. Notwithstanding the foregoing, each Tranche B Term Lender shall be free
to vote as it chooses on any matter put to a vote of the Lenders or the Tranche
B Term Lenders in accordance with Section 9.02, and no exercise by a Tranche B
Term Lender of its voting rights under Section 9.02 shall be deemed a breach of
any of the restrictions or obligations imposed on such Tranche B Term Lender by
the provisions contained or incorporated by reference in this paragraph;
provided, that each Tranche B Term Lender acknowledges and agrees that Section
9.02(b)(iv) will not require the vote of any Tranche B Term Lender to approve
any release of Collateral upon the sale thereof pursuant to an exercise of
remedies under any of the Security Documents.
(b) The agreements contained in this Section are intended to survive
and be fully applicable following the commencement of any bankruptcy or other
insolvency proceeding by or with respect to the Borrower or any Subsidiary, and
to be taken into account and given effect in any such proceeding in a manner
consistent with the intent and agreement of the parties hereto that the Liens
securing the Tranche A Term Obligations and the Revolving Obligations on the one
hand, and the Tranche B Term Obligations on the other hand, are separate Liens
with the Liens securing the Tranche B Term Obligations being subordinate and
junior as set forth in paragraph (a) above to the Liens securing the Tranche A
Term Obligations and the Revolving Obligations.
(c) The agreements contained in this Section are solely for the
benefit of the Tranche A Term Lenders and the Revolving Lenders and shall not
affect the priority of the Liens securing the Tranche B Obligations relative to
the Liens securing any other obligations (other than the Obligations owed to the
Tranche A Term Lenders and the Revolving Lenders) or create any rights in favor
of any other Person (other than the Tranche A Term Lenders, the Revolving
Lenders, the Administrative Agent and the Collateral Agent).
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ARTICLE VIII
The Agents
Each of the Lenders hereby irrevocably appoints the Agents as its
agents and authorizes the Agents to take such actions on its behalf and to
exercise such powers as are delegated to the Agents by the terms hereof and of
the other Credit Documents, together with such actions and powers as are
reasonably incidental thereto.
The bank or banks serving as the Agents hereunder shall have the
same rights and powers in their capacity as Lenders as any other Lender and may
exercise the same as though they were not Agents, and such bank or banks and
their Affiliates may accept deposits from, lend money to and generally engage in
any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if they were not Agents hereunder.
The Agents shall not have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing (a)
the Agents shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) the Agents
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that the Agents are required to exercise in writing by the
Majority Lenders, and (c) except as expressly set forth herein, the Agents shall
not have any duty to disclose, and shall not be liable for the failure to
disclose, any information communicated to the Agents by or relating to the
Borrower or any Subsidiary. The Agents shall not be liable for any action taken
or not taken by them with the consent or at the request of the Majority Lenders
or the Lenders, as the case may be, or in the absence of their own gross
negligence or wilful misconduct. In addition, the Agents shall be deemed not to
have knowledge of any Default unless and until written notice thereof is given
to the Agents by the Borrower or a Lender, and the Agents shall not be
responsible for or have any duty to ascertain or inquire into (i) any statement,
warranty or representation made in or in connection with this Agreement, (ii)
the contents of any certificate, report or other document delivered hereunder or
in connection herewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement or any
other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article III or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to the Agents.
Each Tranche B Term Lender acknowledges that by virtue of the
provisions of Section 7.02 or other provisions of this Agreement the interests
of the Tranche B Term Lenders may conflict with those of the Tranche A Term
Lenders and/or the Revolving Lenders, and agrees that the Agents may perform
their duties under and exercise the authority conferred on them by the Credit
Documents without liability to the Tranche B Term Lenders notwithstanding that
as a result of such performance or exercise the Tranche B Term Lenders might be
disadvantaged relative to the Tranche A Term Lenders and/or the Revolving
Lenders.
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The Agents shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by them to be genuine
and to have been signed or sent by the proper Person. The Agents also may rely
upon any statement made to them orally or by telephone and believed by them to
be made by the proper Person, and shall not incur any liability for relying
thereon. The Agents may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by them with
reasonable care, and shall not be liable for any action taken or not taken by
them in accordance with the advice of any such counsel, accountants or experts.
The Agents may perform any and all their duties and exercise their
rights and powers by or through any one or more sub-agents appointed by the
Agents. The Agents and any such sub-agent may perform any and all their duties
and exercise their rights and powers through their respective Affiliates. The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Affiliates of the Agents and any such sub-agent.
Subject to the appointment and acceptance of a successor Agent as
provided below, either Agent may resign at any time by notifying the Lenders and
the Borrower. Upon any such resignation, the Majority Lenders shall have the
right to appoint a successor with the Borrower's written consent (which shall
not be unreasonably withheld or delayed and shall not be required from the
Borrower if an Event of Default has occurred and is continuing). If no successor
shall have been so appointed by the Majority Lenders and shall have accepted
such appointment within 30 days after the retiring Agent gives notice of its
resignation, then the retiring Agent may, on behalf of the Lenders, with the
Borrower's written consent (which shall not be unreasonably withheld or delayed
and shall not be required if an Event of Default has occurred and is
continuing), appoint a successor Agent which shall be a bank or an Affiliate
thereof, in each case with a net worth of at least $1,000,000,000 and an office
in New York, New York. Upon the acceptance of its appointment as Agent hereunder
by a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After an
Agent's resignation hereunder, the provisions of this Article and Section 9.03
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Agents or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agents or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.
Notwithstanding any other provision contained herein, (a) each
Lender acknowledges that the Administrative Agent is not acting as an agent of
the Borrower and
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that the Borrower will not be responsible for acts or failures to act on the
part of the Administrative Agent and (b) neither the Syndication Agent nor any
of the Documentation Agents shall, in its capacity as such, have any
responsibilities under this Agreement or the other Credit Documents.
Without prejudice to the provisions of this Article VIII, each
Lender hereby irrevocably appoints and authorizes the Collateral Agent (and any
successor acting as Collateral Agent) to act as the person holding the power of
attorney (in such capacity, the "fonde de pouvoir") of the Lenders as
contemplated under Article 2692 of the Civil Code of Quebec, and to enter into,
to take and to hold on their behalf, and for their benefit, any hypothec, and to
exercise such powers and duties which are conferred upon the fonde de pouvoir
under any hypothec. Moreover, without prejudice to such appointment and
authorization to act as the person holding the power of attorney as aforesaid,
each Lender hereby irrevocably appoints and authorizes the Collateral Agent (and
any successor acting as Collateral Agent) (in such capacity, the "Custodian") to
act as agent and custodian for and on behalf of the Lenders to hold and to be
the sole registered holder of any debenture which may be issued under any
hypothec, the whole notwithstanding Section 32 of the Act Respecting the Special
Powers of Legal Persons (Quebec) or any other applicable law. In this respect,
(i) the Custodian shall keep a record indicating the names and addresses of, and
the pro rata portion of the obligations and indebtedness secured by any pledge
of any such debenture and owing to each Lender, and (ii) each Lender will be
entitled to the benefits of any charged property covered by any hypothec and
will participate in the proceeds of realization of any such charged property,
the whole in accordance with the terms hereof.
Each of the fonde de pouvoir and the Custodian shall (a) have the
sole and exclusive right and authority to exercise, except as may be otherwise
specifically restricted by the terms hereof, all rights and remedies given to
fonde de pouvoir and the Custodian (as applicable) with respect to the charged
property under any hypothec, any debenture or pledge thereof relating to any
hypothec, applicable laws or otherwise, (b) benefit from and be subject to all
provisions hereof with respect to the Collateral Agent mutatis mutandis,
including, without limitation, all such provisions with respect to the liability
or responsibility to and indemnification by the Lenders, and (c) be entitled to
delegate from time to time any of its powers or duties under any hypothec, any
debenture or pledge thereof relating to any hypothec, applicable laws or
otherwise and on such terms and conditions as it may determine from time to
time. Any person who becomes a Lender shall be deemed to have consented to and
confirmed: (y) the fonde de pouvoir as the person holding the power of attorney
as aforesaid and to have ratified, as of the date it becomes a Lender, all
actions taken by the fonde de pouvoir in such capacity, (z) the Custodian as the
agent and custodian as aforesaid and to have ratified, as of the date it becomes
a Lender, all actions taken by the Custodian in such capacity.
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ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy or e-mail, as
follows:
(i) if to the Borrower, to it at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇, ▇▇▇▇▇-▇▇▇▇, Attention of the Treasurer (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
or (▇▇▇) ▇▇▇-▇▇▇▇);
(ii) if to the Administrative Agent, to JPMorgan Chase Bank, Loan &
Agency Services Group, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Attention of ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇),
with a copy to JPMorgan Chase Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(iii) if to a Lender, to it at its address (or telecopy number or
e-mail address) set forth in Schedule 2.01 or its Administrative
Questionnaire; and
(iv) if to any Issuing Bank, to it at the address most recently
specified by it in a notice delivered to the Administrative Agent and the
Borrower.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Article II unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address, telecopy number or
e-mail address for notices and other communications hereunder by notice to the
other parties hereto. All notices and other communications given to any party
hereto in accordance with the provisions of this Agreement shall be deemed to
have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by any of
the Agents, any Issuing Bank or any Lender in exercising any right or power
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Agents, the Issuing Banks and the Lenders hereunder are cumulative and are
not exclusive of any rights or remedies that they would
89
otherwise have. No waiver of any provision of this Agreement or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether any Agent, any Issuing Bank or any Lender may
have had notice or knowledge of such Default at the time.
(b) No Credit Document or any provision thereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Credit Parties party thereto and the Administrative Agent or
Collateral Agent, as the case may be, with the consent of the Majority Lenders;
provided, that no such agreement shall (i) increase or extend the expiration
date of the Commitment of any Lender without the written consent of such Lender,
(ii) reduce or forgive all or part of the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon, or reduce any commitment
fee payable hereunder, without the prior written consent of each Lender affected
thereby, (iii) postpone the scheduled date of payment of the principal amount of
any Loan or LC Disbursement or date for the payment of any interest on any Loan
or any commitment fee, or reduce the amount of, waive or excuse any such
payment, without the prior written consent of each Lender adversely affected
thereby, (iv) release all or substantially all the Subsidiary Guarantors from
their Guarantees under the Guarantee and Collateral Agreement, or release all or
substantially all the Collateral from the Liens of the Security Documents,
without the written consent of each Lender, (v) change any provision of the
Guarantee and Collateral Agreement or any other Security Document to alter the
amount or allocation of any payment to be made to the Secured Parties, or effect
any change to Article XI of the Guarantee and Collateral Agreement, without the
consent of each adversely affected Lender, (vi) change Section 2.16 in a manner
that would alter the pro rata sharing of any payment without the written consent
of each Lender adversely affected thereby, (vii) change any of the provisions of
this Section or Section 9.02A or the definition of "Majority Lenders" or
"Majority Borrowing Base Lenders" or any other provision hereof specifying the
number or percentage of Lenders required to waive, amend or modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender, (viii) change any provision of any Credit
Document in a manner that by its terms adversely affects the rights in respect
of payments due to Lenders holding Loans of any Class differently from those
holding Loans of the other Class, without the written consent of Lenders holding
a majority in interest of the outstanding Loans and unused Commitments of the
affected Class or (ix) amend, modify or otherwise alter the definition of
"Availability Block" or the eligibility standards or advance rates used in
determining the Borrowing Base in a manner which would increase the amount of
the Borrowing Base Availability, without the prior written consent of each
Lender (provided that if any amendment, modification or alteration is made after
the date hereof to any eligibility standard by the Administrative Agent or the
Majority Lenders as provided for herein in a manner which would decrease the
amount of the Borrowing Base Availability, such eligibility standard may be
subsequently amended, modified or altered in a manner which would increase the
amount of the Borrowing Base Availability with the prior written consent of
Lenders holding more than 85% in interest of the aggregate amount of
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the outstanding Loans and unused Commitments so long as such eligibility
standard, as so amended, modified or altered, would not have increased the
Borrowing Base Availability if it had been applied on the date hereof);
provided, further that no such agreement shall amend, modify or otherwise affect
the rights or duties of any of the Agents or Issuing Banks under any Credit
Document without the prior written consent of such Agent or Issuing Bank, as the
case may be; provided further that any amendment, modification or waiver of this
Agreement that by its terms affects the rights or duties under this Agreement of
the Revolving Lenders (but not the Term Lenders) or the Term Lenders (but not
the Revolving Lenders) may be effected by an agreement or agreements in writing
entered into by the Borrower and the requisite percentage in interest of the
affected Class of Lenders that would be required to consent thereto under this
Section if such Class of Lenders were the only Class of Lenders hereunder at
such time.
SECTION 9.02A. Layering of Rights in Collateral; Additional
Commitments; Covenants and Defaults. (a) Notwithstanding any other provision
contained herein, no amendment or modification of this Agreement shall (i)
provide for the making of additional Tranche B Term Loans after the Restatement
Effective Date or (ii) provide for the making of additional Loans or other
extensions of credit under this Agreement with rights in the Collateral
subordinate to those of the Tranche A Term Lenders or the Revolving Lenders but
senior to the rights of the Tranche B Term Lenders, in each case without the
written consent of Lenders holding a majority in interest of the outstanding
Tranche B Term Loans.
(b) Notwithstanding any other provision contained herein, no
amendment or modification of this Agreement shall provide for the making of
additional loans (other than pursuant to the Revolving Commitments) or the
provision of additional commitments after the Restatement Effective Date without
the written consent of Lenders having aggregate Revolving Credit Exposures,
Tranche A Term Loans and unused Revolving Commitments representing at least
66-2/3% of the sum of the total Revolving Credit Exposures, Tranche A Term Loans
and unused Revolving Commitments at such time.
(c) Notwithstanding any other provision contained herein, no waiver,
amendment or other modification of the provisions of Article V, Article VI or
Article VII of this Agreement shall be effective without the written consent of
the Majority Borrowing Base Lenders.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the Agents, the
Arrangers and their Affiliates (including the reasonable fees, charges and
disbursements of Cravath, Swaine & ▇▇▇▇▇ LLP, counsel for the Agents and the
Arrangers, and other local and foreign counsel for the Agents and Arrangers,
limited to one per jurisdiction, in connection with the Security Documents and
the creation and perfection of the Liens created thereby and other local and
foreign law matters) in connection with the arrangement and syndication of the
credit facilities provided for herein, the preparation, execution, delivery and
administration of this Agreement and the other Credit Documents or any
amendments, modifications or waivers of the provisions hereof or thereof
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(whether or not the transactions contemplated hereby or thereby shall be
consummated) , (ii) all reasonable out-of-pocket expenses incurred by any
Issuing Bank in connection with the issuance, amendment, renewal or extension of
any Letter of Credit or demand for payment thereunder and (iii) all reasonable
out-of-pocket expenses incurred by the Agents, any Issuing Bank or any Lender,
including the fees, charges and disbursements of any counsel for the Agents, any
Issuing Bank or any Lender, in connection with the enforcement or protection of
its rights in connection with this Agreement, including its rights under this
Section, or in connection with the Loans made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or similar negotiations in respect of such Loans or
Letters of Credit. The Borrower also shall pay all out-of-pocket expenses
incurred by the Collateral Agent in connection with the creation and perfection
of the security interests contemplated by this Agreement, including all filing,
recording and similar fees and, as more specifically set forth above, the
reasonable fees and disbursements of counsel.
(b) The Borrower shall indemnify each Agent, each Arranger, each
Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee), incurred by or asserted against any Indemnitee
and arising out of (i) the execution or delivery of this Agreement or any other
Credit Document or other agreement or instrument contemplated hereby, the
performance by the parties hereto of their respective obligations or the
exercise by the parties hereto of their rights hereunder or thereunder or the
consummation of the Transactions or any other transactions contemplated hereby
or thereby, (ii) any Loan or Letter of Credit or the use of the proceeds thereof
(including any refusal by any Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
currently or formerly owned or operated by the Borrower or any of the
Subsidiaries, or any Environmental Liability related in any way to the Borrower
or any of the Subsidiaries, or (iv) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
shall have resulted from the gross negligence or wilful misconduct of such
Indemnitee or the breach by such Indemnitee of obligations set forth herein or
in any other Credit Document.
(c) To the extent that the Borrower fails to pay any amount required
to be paid by it to any Agent, any Arranger or any Issuing Bank under paragraph
(a) or (b) of this Section, each Lender severally agrees to pay to such Agent,
Arranger or Issuing Bank, as the case may be, such Lender's percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought based on the outstanding Loans and LC Exposures and unused
Commitments of such Lender and the other Lenders (or, if the Commitments shall
have terminated and there shall be no
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outstanding Loans or LC Exposures, based on the Loans and LC Exposures and
unused Commitments most recently in effect)) of such unpaid amount; provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against such
Agent, Arranger or Issuing Bank in its capacity as such.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto,
the Indemnitees and their respective successors and assigns permitted hereby
(including any Affiliate of any Issuing Bank that issues any Letter of Credit),
except that (i) the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Lender
(and any attempted assignment or transfer by the Borrower without such consent
shall be null and void) and (ii) no Lender may assign or otherwise transfer its
rights or obligations hereunder except in accordance with this Section. Nothing
in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, Indemnitees, their respective successors
and assigns permitted hereby (including any Affiliate of any Issuing Bank that
issues any Letter of Credit), Participants (to the extent provided in paragraph
(c) of this Section) and, to the extent expressly contemplated hereby, the
Related Parties of each of the Agents, the Arrangers, the Issuing Banks and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitments and the Loans at the time owing to it); with the prior written
consent (such consent not to be unreasonably withheld or delayed) of:
(A) the Borrower; provided that no consent of the Borrower shall be
required for an assignment to a Lender, an Affiliate of a Lender, an
Approved Fund (as defined below), a Federal Reserve Bank or, if an Event
of Default has occurred and is continuing, any other assignee; provided
further that the consent of the Borrower and the consent of the
Administrative Agent shall be required for an assignment by any Revolving
Lender to any Person (other than a Revolving Lender);
(B) the Administrative Agent; provided that no consent of the
Administrative Agent shall be required for an assignment to an assignee
that is a Lender, an Affiliate of a Lender, a Federal Reserve Bank or an
Approved Fund; and
(C) in the case of any assignment of a Revolving Commitment or any
interests in a Letter of Credit or LC Disbursement, each Principal Issuing
Bank; provided that no consent of any Principal Issuing Bank shall be
required for an assignment to an assignee that is a Federal Reserve Bank.
(ii) Assignments shall be subject to the following additional
conditions:
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(A) except in the case of an assignment to a Lender or an Affiliate
of a Lender, the amount of the Commitment of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $1,000,000 or, if smaller,
the entire remaining amount of the assigning Lender's Commitment unless
each of the Borrower and the Administrative Agent shall otherwise consent,
provided (i) that no such consent of the Borrower shall be required if an
Event of Default has occurred and is continuing and (ii) in the event of
concurrent assignments to two or more assignees that are Affiliates of one
another, or to two or more Approved Funds managed by the same investment
advisor or by affiliated investment advisors, all such concurrent
assignments shall be aggregated in determining compliance with this
subsection;
(B) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations
under this Agreement; provided that this clause shall not be construed to
prohibit the assignment of a proportionate part of all the assigning
Lender's rights and obligations in respect of one Class of Commitments or
Loans;
(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500; provided that in the event of
concurrent assignments to two or more assignees that are Affiliates of one
another, or to two or more Approved Funds managed by the same investment
advisor or by affiliated investment advisors, only one such fee shall be
payable; and
(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date
specified in each Assignment and Assumption the assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Assumption, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Assumption covering all of the assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections
2.13, 2.14, 2.15 and 9.03). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
Section 9.04 shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in
accordance with paragraph (c) of this Section. Each assignment hereunder
shall be deemed to be an assignment of the related rights under the
Guarantee and Collateral Agreement.
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(iv) The Administrative Agent shall maintain at one of its offices a
copy of each Assignment and Assumption delivered to it and a register for
the recordation of the names and addresses of the Lenders, and the
Commitment of, and principal amount of the Loans and LC Disbursements
owing to, each Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the
Borrower, the Administrative Agent, the Issuing Banks and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available
for inspection by the Borrower and any Issuing Bank or Lender, at any
reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall
accept such Assignment and Assumption and record the information contained
therein in the Register. No assignment shall be effective for purposes of
this Agreement unless it has been recorded in the Register as provided in
this paragraph.
(vi) By executing and delivering an Assignment and Assumption, the
assigning Lender thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as
follows: (i) such assigning Lender warrants that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of
any adverse claim and that its Commitment and the outstanding balances of
its Loans, in each case without giving effect to assignments thereof that
have not become effective, are as set forth in such Assignment and
Assumption; (ii) except as set forth in clause (i) above, such assigning
Lender makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or
in connection with this Agreement or any other Credit Document or any
other instrument or document furnished pursuant hereto or thereto, or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of any of the foregoing, or the financial condition of the Credit
Parties or the performance or observance by the Credit Parties of any of
their obligations under this Agreement or under any other Credit Document
or any other instrument or document furnished pursuant hereto or thereto;
(iii) each of the assignee and the assignor represents and warrants that
it is legally authorized to enter into such Assignment and Assumption;
(iv) such assignee confirms that it has received a copy of this Agreement,
together with copies of any amendments or consents entered into prior to
the date of such Assignment and Assumption and copies of the most recent
financial statements delivered pursuant to Section 5.01 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Assumption;
(v) such assignee will independently and without reliance upon the
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Agents, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement; (vi) such assignee appoints and authorizes the
Agents to take such action as agents on its behalf and to exercise such
powers under this Agreement and the other Credit Documents as are
delegated to them by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the
obligations that by the terms of this Agreement are required to be
performed by it as a Lender.
(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent or any Issuing Bank, sell participations to one or more
banks or other entities (each a "Participant") in all or a portion of such
Lender's rights and/or obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it); provided that (A) such
Lender's obligations under this Agreement shall remain unchanged, (B) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (C) the Borrower, the Administrative Agent,
the Issuing Banks and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver that
affects such Participant and that, under Section 9.02, would require the consent
of each affected Lender. Subject to paragraph (c)(ii) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.13, 2.14 and 2.15 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 9.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.16(d) as though it were a Lender.
(ii) A Participant shall not be entitled to receive any greater
payment under Section 2.13 or 2.15 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower's prior written consent, which consent shall
specifically refer to this exception. A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits
of Section 2.15 unless the Borrower is notified of the participation sold
to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.15(e) as though it were a Lender.
(d) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest;
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provided that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.
SECTION 9.05. Survival. All covenants, agreements, representations
and warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit, regardless of any investigation made by
any such other party or on its behalf and notwithstanding that any Agent, any
Issuing Bank or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated. The
provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article VIII shall survive
and remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the Letters of Credit or the termination of
this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This
Agreement may be executed by the execution of counterparts of the First
Amendment (and by different parties hereto on different counterparts of the
First Amendment), each of which shall constitute an original, but all of which
when taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent or the Arrangers constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective as provided in the First Amendment. Delivery of
an executed counterpart of a signature page of the First Amendment by telecopy
shall be effective as delivery of a manually executed counterpart of this
Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction. No failure to obtain any approval required for the effectiveness
of any provision of this Agreement shall affect the validity or enforceability
of any other provision of this Agreement.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing and the Loans shall have become due and payable
pursuant to Article VII, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and
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other obligations at any time owing by such Lender or Affiliate to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) Each party hereto hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that any party hereto may
otherwise have to bring any action or proceeding relating to this Agreement in
the courts of any jurisdiction.
(c) Each party hereto hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any court referred to
in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR
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OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Agents, the Issuing Banks
and the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors who have been informed of the confidential
nature of such Information and instructed to keep such Information confidential,
(b) to the extent requested by any regulatory authority (including the NAIC),
(c) to the extent required by applicable laws or regulations or by any subpoena
or similar legal process, (d) to any other party to this Agreement, (e) to the
extent necessary or advisable in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or the
enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any assignee
of or Participant in, or any prospective assignee of or Participant in, any of
its rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (g) with the written consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to any Agent,
any Issuing Bank or any Lender on a nonconfidential basis from a source other
than the Borrower. For the purposes of this Section, "Information" means all
information received from the Borrower or Persons acting on its behalf relating
to the Borrower or its business, other than any such information that is
available to any Agent or any Lender prior to disclosure by the Borrower on a
nonconfidential basis from a source other than the Borrower that is not known by
the recipient to be bound by a confidentiality agreement or other obligation of
confidentiality with respect to such information. Notwithstanding anything
herein to the contrary, any party to this Agreement (and any employee,
representative or other agent of such party) may disclose to any and all
Persons, without limitation of any kind, the tax treatment and tax structure of
the transactions contemplated by this Agreement and all materials of any kind
(including opinions or other tax analyses) that are provided to it relating to
such tax treatment and tax structure, but no party shall disclose any
information relating to such tax treatment or tax structure to the extent
nondisclosure is necessary in order to comply with applicable securities laws.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under
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applicable law (collectively, the "Charges"), shall exceed the maximum lawful
rate (the "Maximum Rate") which may be contracted for, charged, taken, received
or reserved by the Lender holding such Loan in accordance with applicable law,
the rate of interest payable in respect of such Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate
and, to the extent lawful, the interest and Charges that would have been payable
in respect of such Loan but were not payable as a result of the operation of
this Section shall be cumulated and the interest and Charges payable to such
Lender in respect of other Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Alternate Base Rate to the date of repayment, shall have been
received by such Lender.
SECTION 9.14. Security Documents. Each Lender hereby authorizes and
directs the Collateral Agent to execute and deliver the Guarantee and Collateral
Agreement and each other Security Document. Each Lender, by executing and
delivering this Agreement, acknowledges receipt of a copy of the Guarantee and
Collateral Agreement and approves and agrees to be bound by and to act in
accordance with the terms and conditions of the Guarantee and Collateral
Agreement and each other Security Document, specifically including (i) the
provisions of Article VI of the Guarantee and Collateral Agreement (governing
the exercise of remedies under the Security Documents and the distribution of
the proceeds realized from such exercise), (ii) the provisions of Article VIII
of the Guarantee and Collateral Agreement (governing the manner in which acts of
the Secured Parties are to be evidenced and the manner in which the amounts of
the Obligations and the other Obligations (as defined in the Guarantee and
Collateral Agreement) are to be determined at any time), (iii) the provisions of
Articles IX and X of the Guarantee and Collateral Agreement (relating to the
duties and responsibilities of the Collateral Agent and providing for the
indemnification and the reimbursement of expenses of the Collateral Agent by the
Lenders), (iv) the provisions of Article XI of the Guarantee and Collateral
Agreement (providing for the subordination of certain Junior Liens (as defined
therein) in favor of the Secured Parties to the Applicable Senior Liens (as
defined therein)) and (v) the provisions of Section 13.13 of the Guarantee and
Collateral Agreement (providing for releases of Guarantees of and Collateral
securing the Obligations). Each party hereto further agrees that the foregoing
provisions of the Guarantee and Collateral Agreement shall apply to each other
Security Document.
SECTION 9.15. Additional Financial Covenants. Notwithstanding
anything else contained herein to the contrary, in the event that any
maintenance financial covenant other than the financial covenants set forth in
Sections 6.09, 6.10 and 6.11 is included in any Senior Subordinated-Lien
Document (as defined in Annex A to the First Amendment), such covenant will be
deemed to be added to this Agreement automatically, without the need for any
further action whatsoever.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
THE GOODYEAR TIRE & RUBBER
COMPANY
by
/s/ ▇. ▇. ▇▇▇▇▇
------------------------------------
Name: ▇. ▇. ▇▇▇▇▇
Title: Vice President
JPMORGAN CHASE BANK, individually and as
Administrative Agent and Collateral Agent,
by
/s/ B. ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: B. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
101
[Remaining Signature Pages Intentionally Omitted]
102