Exhibit 10.33
EXECUTION COPY
U.S. $100,000,000
364-DAY CREDIT AGREEMENT
Dated as of June 21, 2002
Among
PLATINUM UNDERWRITERS HOLDINGS, LTD.
AS BORROWER
and
THE INITIAL LENDERS NAMED HEREIN
AS INITIAL LENDERS
and
CITIBANK, N.A.
AS AGENT
and
JPMORGAN CHASE BANK
and
BANK OF AMERICA, N.A.
AS SYNDICATION AGENTS
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
AS AGENT
TABLE OF CONTENTS
ARTICLE I
SECTION 1.01. CERTAIN DEFINED TERMS 1
SECTION 1.02. COMPUTATION OF TIME PERIODS 9
SECTION 1.03. ACCOUNTING TERMS 9
ARTICLE II
SECTION 2.01. THE ADVANCES 10
SECTION 2.02. MAKING THE ADVANCES 10
SECTION 2.03. FEES 11
SECTION 2.04. OPTIONAL TERMINATION OR REDUCTION OF THE COMMITMENTS 11
SECTION 2.05. REPAYMENT OF ADVANCES 11
SECTION 2.06. INTEREST ON ADVANCES 11
SECTION 2.07. INTEREST RATE DETERMINATION 11
SECTION 2.08. OPTIONAL CONVERSION OF ADVANCES 12
SECTION 2.09. PREPAYMENTS OF ADVANCES 13
SECTION 2.10. INCREASED COSTS 13
SECTION 2.11. ILLEGALITY 13
SECTION 2.12. PAYMENTS AND COMPUTATIONS 13
SECTION 2.13. TAXES 14
SECTION 2.14. SHARING OF PAYMENTS, ETC. 15
SECTION 2.15. EVIDENCE OF DEBT 15
SECTION 2.16. USE OF PROCEEDS 16
SECTION 2.17. INCREASE IN THE AGGREGATE COMMITMENTS 16
SECTION 2.18. EXTENSION OF TERMINATION DATE 17
ARTICLE III
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION 2.01 18
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING, COMMITMENT
INCREASE AND EXTENSION DATE. 20
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01 20
ARTICLE IV
SECTION 4.01. REPRESENTATIONS AND WARRANTIES
OF THE BORROWER 20
ARTICLE V
SECTION 5.01. AFFIRMATIVE COVENANTS 22
SECTION 5.02. NEGATIVE COVENANTS 24
SECTION 5.03. FINANCIAL COVENANTS 26
ARTICLE VI
SECTION 6.01. EVENTS OF DEFAULT 26
ARTICLE VII
SECTION 7.01. AUTHORIZATION AND ACTION 28
SECTION 7.02. AGENT'S RELIANCE, ETC. 28
SECTION 7.03. CITIBANK AND AFFILIATES 28
SECTION 7.04. LENDER CREDIT DECISION 29
SECTION 7.05. INDEMNIFICATION 29
SECTION 7.06. SUCCESSOR AGENT 29
SECTION 7.07. OTHER AGENTS. 29
ARTICLE VIII
SECTION 8.01. AMENDMENTS, ETC. 29
SECTION 8.02. NOTICES, ETC. 30
SECTION 8.03. NO WAIVER; REMEDIES 30
SECTION 8.04. COSTS AND EXPENSES 30
SECTION 8.05. RIGHT OF SET-OFF 31
ii
SECTION 8.06. BINDING EFFECT 31
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS 32
SECTION 8.08. CONFIDENTIALITY 33
SECTION 8.09. GOVERNING LAW 33
SECTION 8.10. EXECUTION IN COUNTERPARTS 34
SECTION 8.11. JUDGMENT 34
SECTION 8.12. JURISDICTION, ETC. 34
SECTION 8.13. WAIVER OF JURY TRIAL 35
iii
SCHEDULES
Schedule I - List of Applicable Lending Offices
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D-1 - Form of Opinion of Bermuda Counsel for the Borrower
Exhibit D-2 - Form of Opinion of
New York Counsel for the Borrower
iv
364-DAY CREDIT AGREEMENT
Dated as of June 21, 2002
PLATINUM UNDERWRITERS HOLDINGS, LTD., a company organized under the
laws of Bermuda (the "BORROWER"), the banks, financial institutions and other
institutional lenders (the "INITIAL LENDERS") listed on the signature pages
hereof, JPMORGAN CHASE BANK and BANK OF AMERICA, N.A., as syndication agents,
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC., as lead arranger, and CITIBANK, N.A. ("CITIBANK"), as
agent (the "AGENT") for the Lenders (as hereinafter defined), agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ADVANCE" means an advance by a Lender to the Borrower as part of a
Borrowing and refers to a Base Rate Advance or a Eurodollar Rate Advance
(each of which shall be a "TYPE" of Advance).
"AFFILIATE" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling",
"controlled by" and "under common control with") of a Person means the
possession, direct or indirect, of the power to vote 5% or more of the
Voting Stock of such Person or to direct or cause the direction of the
management and policies of such Person, whether through the ownership of
Voting Stock, by contract or otherwise.
"AGENT'S ACCOUNT" means the account of the Agent maintained by the
Agent at Citibank at its office at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Account No. ▇▇▇▇▇▇▇▇, Attention: Bank Loan Syndications, or such
other account as the Agent may from time to time specify as the "Agent's
Account".
"ANNUAL STATEMENT" means the annual financial statement of an Insurance
Subsidiary as required to be filed with the Authority (or similar
governmental authority) of such Subsidiary's domicile, together with all
exhibits or schedules filed therewith, prepared in conformity with SAP.
"APPLICABLE LENDING OFFICE" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of a Base Rate Advance and
such Lender's Eurodollar Lending Office in the case of a Eurodollar Rate
Advance.
"APPLICABLE MARGIN" means (a) for Base Rate Advances, 0% per annum and
(b) for Eurodollar Rate Advances, as of any date prior to which the
Borrower first has a Public Debt Rating, 0.500% per annum and, as of any
date thereafter, a percentage per annum determined by reference to the
Public Debt Rating in effect on such date as set forth below:
Public Debt Rating Applicable Margin for
S&P/Moody's Eurodollar Rate
Advances
LEVEL 1
A or A2 or above 0.445%
LEVEL 2
A- or A3 0.475%
▇▇▇▇▇ ▇
BBB+ or Baa1 0.500%
▇▇▇▇▇ ▇
BBB or Baa2 0.550%
▇▇▇▇▇ ▇
▇▇▇- ▇▇▇ ▇▇▇▇ 0.675%
▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇ 0.750%
"APPLICABLE PERCENTAGE" means, as of any date prior to which the
Borrower first has a Public Debt Rating, 0.125% per annum and, as of any
date thereafter, a percentage per annum determined by reference to the
Public Debt Rating in effect on such date as set forth below:
Public Debt Rating Applicable
S&P/Moody's Percentage
LEVEL 1
A or A2 or above 0.080%
LEVEL 2
A- or A3 0.100%
▇▇▇▇▇ ▇
BBB+ or Baa1 0.125%
▇▇▇▇▇ ▇
BBB or Baa2 0.150%
▇▇▇▇▇ ▇
▇▇▇- ▇▇▇ ▇▇▇▇ 0.200%
▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇ 0.250%
"APPLICABLE UTILIZATION FEE" means, as of any date that the aggregate
Advances exceed 50% of the Commitments, (a) prior to which the Borrower
first has a Public Debt Rating, 0.125% per annum and (b) as of any date
thereafter, a percentage per annum determined by reference to the Public
Debt Rating in effect on such date as set forth below:
Public Debt Rating Applicable
S&P/Moody's Utilization Fee
LEVEL 1
A or A2 or above 0.125%
LEVEL 2
A- or A3 0.125%
▇▇▇▇▇ ▇
BBB+ or Baa1 0.125%
▇▇▇▇▇ ▇
BBB or Baa2 0.125%
▇▇▇▇▇ ▇
▇▇▇- ▇▇▇ ▇▇▇▇ 0.125%
▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇ 0.250%
2
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance entered
into by a Lender and an Eligible Assignee, and accepted by the Agent, in
substantially the form of Exhibit C hereto.
"ASSUMING LENDER" has the meaning specified in Section 2.17(d).
"ASSUMPTION AGREEMENT" has the meaning specified in Section
2.17(d)(ii).
"AUTHORITY" means the Bermuda Monetary Authority or similar
governmental authority in the applicable jurisdiction.
"BASE RATE" means a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the
highest of:
(a) the rate of interest announced publicly by Citibank in
New
York,
New York, from time to time, as Citibank's base rate; and
(b)1/2 of one percent per annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance that bears interest as provided in
Section 2.06(a)(i).
"BORROWING" means a borrowing consisting of simultaneous Advances of
the same Type made by each of the Lenders pursuant to Section 2.01.
"BUSINESS DAY" means a day of the year on which banks are not required
or authorized by law to close in
New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.
"CITIBANK" means Citibank, N.A.
"COMMITMENT" means as to any Lender (a) the amount set forth opposite
such Lender's name on Schedule I hereto, (b) if such Lender has become a
Lender hereunder pursuant to an Assumption Agreement, the amount set forth
in such Assumption Agreement or (c) if such Lender has entered into any
Assignment and Acceptance, the amount set forth for such Lender in the
Register maintained by the Agent pursuant to Section 8.07(d), as such
amount may be reduced pursuant to Section 2.04 or increased pursuant to
Section 2.17.
"COMMITMENT DATE" has the meaning specified in Section 2.17(b).
"COMMITMENT INCREASE" has the meaning specified in Section 2.17(a).
"CONFIDENTIAL INFORMATION" means information that the Borrower
furnishes to the Agent or any Lender in a writing designated as
confidential, but does not include any such information that is or becomes
generally available to the public or that is or becomes available to the
Agent or such Lender from a source other than the Borrower.
"CONSENTING LENDER" has the meaning specified in Section 2.18(b).
"CONSOLIDATED" refers to the consolidation of accounts in accordance
with GAAP.
"CONVERT", "CONVERSION" and "CONVERTED" each refers to a conversion of
Advances of one Type into Advances of the other Type pursuant to Section
2.07 or 2.08.
"DEBT" of any Person means, without duplication, (a) all indebtedness
of such Person for borrowed money, (b) all obligations of such Person for
the deferred purchase price of property or services (other than
3
trade payables not overdue by more than 60 days incurred in the ordinary
course of such Person's business), (c) all obligations of such Person
evidenced by notes, bonds, debentures or other similar instruments, (d) all
obligations of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under
such agreement in the event of default are limited to repossession or sale
of such property), (e) all obligations of such Person as lessee under
leases that have been or should be, in accordance with GAAP, recorded as
capital leases, (f) all obligations, contingent or otherwise, of such
Person in respect of acceptances, letters of credit or similar extensions
of credit, (g) all obligations of such Person in respect of Hedge
Agreements, (h) all Debt of others referred to in clauses (a) through (g)
above or clause (i) below and other payment obligations guaranteed directly
or indirectly in any manner by such Person, or in effect guaranteed
directly or indirectly by such Person through an agreement (1) to pay or
purchase such Debt or to advance or supply funds for the payment or
purchase of such Debt, (2) to purchase, sell or lease (as lessee or lessor)
property, or to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such Debt or to assure the holder of
such Debt against loss, (3) to supply funds to or in any other manner
invest in the debtor (including any agreement to pay for property or
services irrespective of whether such property is received or such services
are rendered) or (4) otherwise to assure a creditor against loss, and (i)
all Debt referred to in clauses (a) through (h) above secured by (or for
which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including, without
limitation, accounts and contract rights) owned by such Person, even though
such Person has not assumed or become liable for the payment of such Debt;
PROVIDED, that obligations under Reinsurance Agreements and Primary
Policies and guarantees of such obligations shall not constitute "Debt".
"DEBT FOR BORROWED MONEY" of any Person means all items that, in
accordance with GAAP, would be classified as indebtedness on a consolidated
balance sheet of such Person.
"DEFAULT" means any Event of Default or any event that would constitute
an Event of Default but for the requirement that notice be given or time
elapse or both.
"DOMESTIC LENDING OFFICE" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" opposite its name
on Schedule I hereto or in the Assumption Agreement or the Assignment and
Acceptance pursuant to which it became a Lender, or such other office of
such Lender as such Lender may from time to time specify to the Borrower
and the Agent.
"EFFECTIVE DATE" has the meaning specified in Section 3.01.
"ELIGIBLE ASSIGNEE" means (i) a Lender; (ii) an Affiliate of a Lender;
and (iii) any other Person approved by the Agent and, unless an Event of
Default has occurred and is continuing at the time any assignment is
effected in accordance with Section 8.07, the Borrower, such approval not
to be unreasonably withheld or delayed; PROVIDED, HOWEVER, that neither the
Borrower nor an Affiliate of the Borrower shall qualify as an Eligible
Assignee.
"ENVIRONMENTAL LAW" means any federal, state, local or foreign statute,
law, ordinance, rule, regulation, code, order, judgment, decree or judicial
or agency interpretation, policy or guidance relating to pollution or
protection of the environment, health, safety or natural resources,
including, without limitation, those relating to the use, handling,
transportation, treatment, storage, disposal, release or discharge of
hazardous materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA AFFILIATE" means any Person that for purposes of Title IV of
ERISA is a member of the Borrower's controlled group, or under common
control with the Borrower, within the meaning of Section 414 of the
Internal Revenue Code.
4
"ERISA EVENT" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Plan
unless the 30-day notice requirement with respect to such event has been
waived by the PBGC, or (ii) the requirements of subsection (1) of Section
4043(b) of ERISA (without regard to subsection (2) of such Section) are met
with respect to a contributing sponsor, as defined in Section 4001(a)(13)
of ERISA, of a Plan, and an event described in paragraph (9), (10), (11),
(12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days; (b) the application
for a minimum funding waiver with respect to a Plan; (c) the provision by
the administrator of any Plan of a notice of intent to terminate such Plan
pursuant to Section 4041(a)(2) of ERISA (including any such notice with
respect to a plan amendment referred to in Section 4041(e) of ERISA); (d)
the cessation of operations at a facility of the Borrower or any ERISA
Affiliate in the circumstances described in Section 4062(e) of ERISA; (e)
the withdrawal by the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial employer,
as defined in Section 4001(a)(2) of ERISA; (f) the conditions for the
imposition of a lien under Section 302(f) of ERISA shall have been met with
respect to any Plan; (g) the adoption of an amendment to a Plan requiring
the provision of security to such Plan pursuant to Section 307 of ERISA; or
(h) the institution by the PBGC of proceedings to terminate a Plan pursuant
to Section 4042 of ERISA, or the occurrence of any event or condition
described in Section 4042 of ERISA that constitutes grounds for the
termination of, or the appointment of a trustee to administer, a Plan.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite
its name on Schedule I hereto or in the Assumption Agreement or the
Assignment and Acceptance pursuant to which it became a Lender (or, if no
such office is specified, its Domestic Lending Office), or such other
office of such Lender as such Lender may from time to time specify to the
Borrower and the Agent.
"EURODOLLAR RATE" means, for any Interest Period for each Eurodollar
Rate Advance comprising part of the same Borrowing, an interest rate per
annum equal to the rate per annum obtained by dividing (a) the rate per
annum (rounded upward to the nearest whole multiple of 1/16 of 1% per
annum) appearing on Telerate Markets Page 3750 (or any successor page) as
the London interbank offered rate for deposits in U.S. dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the first
day of such Interest Period for a term comparable to such Interest Period
or, if for any reason such rate is not available, the average (rounded
upward to the nearest whole multiple of 1/16 of 1% per annum, if such
average is not such a multiple) of the rate per annum at which deposits in
U.S. dollars are offered by the principal office of each of the Reference
Banks in London, England to prime banks in the London interbank market at
11:00 A.M. (London time) two Business Days before the first day of such
Interest Period in an amount substantially equal to such Reference Bank's
Eurodollar Rate Advance comprising part of such Borrowing to be outstanding
during such Interest Period and for a period equal to such Interest Period
by (b) a percentage equal to 100% minus the Eurodollar Rate Reserve
Percentage for such Interest Period. If the Telerate Markets Page 3750 (or
any successor page) is unavailable, the Eurodollar Rate for any Interest
Period for each Eurodollar Rate Advance comprising part of the same
Borrowing shall be determined by the Agent on the basis of applicable rates
furnished to and received by the Agent from the Reference Banks two
Business Days before the first day of such Interest Period, SUBJECT,
HOWEVER, to the provisions of Section 2.07.
"EURODOLLAR RATE ADVANCE" means an Advance that bears interest as
provided in Section 2.06(a)(ii).
"EURODOLLAR RATE RESERVE PERCENTAGE" for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing means the
reserve percentage applicable two Business Days before the first day of
such Interest Period under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement
5
(including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for a member bank of the Federal Reserve
System in
New York City with respect to liabilities or assets consisting of
or including Eurocurrency Liabilities (or with respect to any other
category of liabilities that includes deposits by reference to which the
interest rate on Eurodollar Rate Advances is determined) having a term
equal to such Interest Period.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXTENSION DATE" has the meaning specified in Section 2.18(b).
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next preceding
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 of the
quotations for such day on such transactions received by the Agent from
three Federal funds brokers of recognized standing selected by it.
"GAAP" has the meaning specified in Section 1.03.
"HEDGE AGREEMENTS" means interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements,
currency future or option contracts and other similar agreements.
"INCREASE DATE" has the meaning specified in Section 2.17(a).
"INCREASING LENDER" has the meaning specified in Section 2.17(b).
"INFORMATION MEMORANDUM" means the information memorandum dated May 31,
2002 used by the Agent in connection with the syndication of the
Commitments.
"INSURANCE CODE" means, with respect to any Insurance Subsidiary, the
statute of such Insurance Subsidiary's domicile that governs the formation
and operation of entities engaged in the business of insurance and any
successor statute of similar import, together with the regulations
thereunder, as amended or otherwise modified and in effect from time to
time.
"INSURANCE SUBSIDIARY" means any Subsidiary of the Borrower which is
licensed by any governmental authority to engage in the insurance business
by issuing Primary Policies or entering into Reinsurance Agreements.
"INTEREST PERIOD" means, for each Eurodollar Rate Advance comprising
part of the same Borrowing, the period commencing on the date of such
Eurodollar Rate Advance or the date of the Conversion of any Base Rate
Advance into such Eurodollar Rate Advance and ending on the last day of the
period selected by the Borrower pursuant to the provisions below and,
thereafter, with respect to Eurodollar Rate Advances, each subsequent
period commencing on the last day of the immediately preceding Interest
Period and ending on the last day of the period selected by the Borrower
pursuant to the provisions below. The duration of each such Interest Period
shall be one, two, three or six months, as the Borrower may, upon notice
received by the Agent not later than 11:00 A.M. (
New York City time) on the
third Business Day prior to the first day of such Interest Period, select;
PROVIDED, HOWEVER, that:
(a) the Borrower may not select any Interest Period that ends
after the Termination Date;
6
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing shall be
of the same duration;
(c) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding
Business Day, PROVIDED, HOWEVER, that, if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on the
next preceding Business Day; and
(d) whenever the first day of any Interest Period occurs on a
day of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such initial
calendar month by the number of months equal to the number of months in
such Interest Period, such Interest Period shall end on the last
Business Day of such succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"INVESTED ASSETS" means cash, cash equivalents, short term investments,
investments held for sale and any other assets which are treated as
investments under GAAP.
"LENDERS" means the Initial Lenders, each Assuming Lender that shall
become a party hereto pursuant to Section 2.17 or 2.18 and each Person that
shall become a party hereto pursuant to Section 8.07.
"LICENSES" means hold licenses (including, without limitation, licenses
or certificates of authority from applicable insurance departments),
permits or authorizations to transact insurance and reinsurance business.
"LIEN" means any lien, security interest or other charge or encumbrance
of any kind, or any other type of preferential arrangement, including,
without limitation, the lien or retained security title of a conditional
vendor and any easement, right of way or other encumbrance on title to real
property.
"MATERIAL ADVERSE CHANGE" means any material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or the Borrower and its
Subsidiaries taken as a whole.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or the Borrower and its
Subsidiaries taken as a whole, (b) the rights and remedies of the Agent or
any Lender under this Agreement or any Note or (c) the ability of the
Borrower to perform its obligations under this Agreement or any Note.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate is making
or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make
contributions.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and at least one Person other than the
Borrower and the ERISA Affiliates or (b) was so maintained and in respect
of which the Borrower or any ERISA Affiliate could have liability under
Section 4064 or 4069 of ERISA in the event such plan has been or were to be
terminated.
"NON-CONSENTING LENDER" has the meaning specified in Section 2.18(b).
7
"NOTE" means a promissory note of the Borrower payable to the order of
any Lender, delivered pursuant to a request made under Section 2.15 in
substantially the form of Exhibit A hereto, evidencing the aggregate
indebtedness of the Borrower to such Lender resulting from the Advances
made by such Lender.
"NOTICE OF BORROWING" has the meaning specified in Section 2.02(a).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall
have been commenced: (a) Liens for taxes, assessments and governmental
charges or levies to the extent not required to be paid under Section
5.01(b) hereof; (b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and other similar
Liens arising in the ordinary course of business securing obligations that
are not overdue for a period of more than 60 days; (c) pledges or deposits
to secure obligations under workers' compensation laws or similar
legislation or to secure public or statutory obligations; and (d)
easements, rights of way and other encumbrances on title to real property
that do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use of such property for its present
purposes.
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association,
joint venture, limited liability company or other entity, or a government
or any political subdivision or agency thereof.
"PLAN" means a Single Employer Plan or a Multiple Employer Plan. ----
"PRIMARY POLICIES" means any insurance policies issued by an Insurance
Subsidiary.
"PUBLIC DEBT RATING" means, as of any date, the rating that has been
most recently announced by either S&P or ▇▇▇▇▇'▇, as the case may be, for
any class of non-credit enhanced long-term senior unsecured debt issued by
the Borrower. For purposes of the foregoing, (a) if only one of S&P and
▇▇▇▇▇'▇ shall have in effect a Public Debt Rating, the Applicable Margin,
the Applicable Percentage and the Applicable Utilization Fee shall be
determined by reference to the available rating; (b) if at any time after
the Borrower first has a Public Debt Rating issued by either S&P or
▇▇▇▇▇'▇, neither S&P nor ▇▇▇▇▇'▇ shall have in effect a Public Debt Rating,
the Applicable Margin, the Applicable Percentage and the Applicable
Utilization Fee will be set in accordance with Level 6 under the definition
of "APPLICABLE MARGIN", "APPLICABLE PERCENTAGE" or "APPLICABLE UTILIZATION
FEE", as the case may be; (c) if the ratings established by S&P and ▇▇▇▇▇'▇
shall fall within different levels, the Applicable Margin, the Applicable
Percentage and the Applicable Utilization Fee shall be based upon the
higher rating unless such ratings differ by two or more levels, in which
case the applicable level will be one level above the lower of such levels;
(d) if any rating established by S&P or ▇▇▇▇▇'▇ shall be changed, such
change shall be effective as of the date on which such change is first
announced publicly by the rating agency making such change; and (e) if S&P
or ▇▇▇▇▇'▇ shall change the basis on which ratings are established, each
reference to the Public Debt Rating announced by S&P or ▇▇▇▇▇'▇, as the
case may be, shall refer to the then equivalent rating by S&P or ▇▇▇▇▇'▇,
as the case may be.
"REFERENCE BANKS" means Citibank, JPMorgan Chase Bank and Bank of
America, N.A.
"REGISTER" has the meaning specified in Section 8.07(d).
"REGISTRATION STATEMENT" means the Form S-1 Registration Statement
under the Securities Act of 1933, filed with the Securities and Exchange
Commission on June 14, 2002, as such Form S-1 may be amended, modified or
otherwise supplemented from time to time and distributed to the Lenders
prior to June 21, 2002, or as further amended, modified or supplemented
from time to time as is acceptable to the Required Lenders.
8
"REINSURANCE AGREEMENTS" means any agreement, contract, treaty,
certificate or other arrangement whereby the Borrower or any Subsidiary
agrees to assume from or reinsure an insurer or reinsurer all or part of
the liability of such insurer or reinsurer under a policy or policies of
insurance issued by such insurer or reinsurer.
"REQUIRED LENDERS" means at any time Lenders owed at least 66-2/3% of
the then aggregate unpaid principal amount of the Advances owing to
Lenders, or, if no such principal amount is then outstanding, Lenders
having at least 66-2/3% of the Commitments.
"S&P" means Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
"SAP" means, as to each Insurance Subsidiary, the statutory accounting
practices prescribed or permitted by the Authority (or other similar
authority) in such Insurance Subsidiary's domicile for the preparation of
Annual Statements and other financial reports by insurance corporations of
the same type as such Insurance Subsidiary.
"SINGLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and no Person other than the Borrower and
the ERISA Affiliates or (b) was so maintained and in respect of which the
Borrower or any ERISA Affiliate could have liability under Section 4069 of
ERISA in the event such plan has been or were to be terminated.
"ST. ▇▇▇▇" means The St. ▇▇▇▇ Companies, Inc., a Minnesota
corporation.
"SUBSIDIARY" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having
ordinary voting power to elect a majority of the Board of Directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such limited liability company, partnership or joint venture or
(c) the beneficial interest in such trust or estate is at the time directly
or indirectly owned or controlled by such Person, by such Person and one or
more of its other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"TERMINATION DATE" means the earlier of (a) June 20, 2003, subject to
the extension thereof pursuant to Section 2.18 and (b) the date of
termination in whole of the Commitments pursuant to Section 2.04 or 6.01;
PROVIDED, HOWEVER, that the Termination Date of any Lender that is a
Non-Consenting Lender to any requested extension pursuant to Section 2.18
shall be the Termination Date in effect immediately prior to the applicable
Extension Date for all purposes of this Agreement.
"VOTING STOCK" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening of
such a contingency.
SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Section 4.01(e) ("GAAP").
9
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01. THE ADVANCES. Each Lender severally agrees, on the terms
and conditions hereinafter set forth, to make Advances to the Borrower from time
to time on any Business Day during the period from the Effective Date until the
Termination Date in an aggregate amount not to exceed at any time outstanding
such Lender's Commitment. Each Borrowing shall be in an aggregate amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof and shall
consist of Advances of the same Type made on the same day by the Lenders ratably
according to their respective Commitments. Within the limits of each Lender's
Commitment, the Borrower may borrow under this Section 2.01, prepay pursuant to
Section 2.09 and reborrow under this Section 2.01.
SECTION 2.02. MAKING THE ADVANCES. (a) Each Borrowing shall be made on
notice, given not later than (x) 11:00 A.M. (
New York City time) on the third
Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing consisting of Eurodollar Rate Advances or (y) 11:00 A.M. (
New York
City time) on the first Business Day prior to the date of the proposed Borrowing
in the case of a Borrowing consisting of Base Rate Advances, by the Borrower to
the Agent, which shall give to each Lender prompt notice thereof by telecopier
or telex. Each such notice of a Borrowing (a "NOTICE OF BORROWING") shall be by
telephone, confirmed immediately in writing, or telecopier or telex in
substantially the form of Exhibit B hereto, specifying therein the requested (i)
date of such Borrowing, (ii) Type of Advances comprising such Borrowing, (iii)
aggregate amount of such Borrowing, and (iv) in the case of a Borrowing
consisting of Eurodollar Rate Advances, initial Interest Period for each such
Advance. Each Lender shall, before 11:00 A.M. (
New York City time) on the date
of such Borrowing make available for the account of its Applicable Lending
Office to the Agent at the Agent's Account, in same day funds, such Lender's
ratable portion of such Borrowing. After the Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in Article III, the
Agent will make such funds available to the Borrower at the Agent's address
referred to in Section 8.02.
(b) Anything in subsection (a) above to the contrary notwithstanding,
(i) the Borrower may not select Eurodollar Rate Advances for any Borrowing if
the aggregate amount of such Borrowing is less than $5,000,000 or if the
obligation of the Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.07 or 2.11 and (ii) the Eurodollar Rate Advances
may not be outstanding as part of more than six separate Borrowings.
(c) Each Notice of Borrowing shall be irrevocable and binding on the
Borrower. In the case of any Borrowing that the related Notice of Borrowing
specifies is to be comprised of Eurodollar Rate Advances, the Borrower shall
indemnify each Lender against any loss, cost or expense incurred by such Lender
as a result of any failure to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth in
Article III, including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to fund the
Advance to be made by such Lender as part of such Borrowing when such Advance,
as a result of such failure, is not made on such date.
(d) Unless the Agent shall have received notice from a Lender prior to
the date of any Borrowing that such Lender will not make available to the Agent
such Lender's ratable portion of such Borrowing, the Agent may assume that such
Lender has made such portion available to the Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.02 and the Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made such ratable portion available to the Agent, such Lender and the
Borrower severally agree to repay to the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Agent, at (i) in the case of the Borrower, the interest rate
applicable at the time to Advances comprising such Borrowing and (ii) in the
case of such Lender, the Federal Funds Rate. If such Lender shall repay to the
Agent such corresponding amount, such amount so repaid shall constitute such
Lender's Advance as part of such Borrowing for purposes of this Agreement.
(e) The failure of any Lender to make the Advance to be made by it
as part of any Borrowing shall not relieve any other Lender of its obligation,
if any, hereunder to make its Advance on the date of such
10
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Advance to be made by such other Lender on the date of any
Borrowing.
SECTION 2.03. FEES. (a) FACILITY FEE. The Borrower agrees to pay to the
Agent for the account of each Lender a facility fee on the aggregate amount of
such Lender's Commitment from the Effective Date in the case of each Initial
Lender and from the effective date specified in the Assumption Agreement or in
the Assignment and Acceptance pursuant to which it became a Lender in the case
of each other Lender until the Termination Date at a rate per annum equal to the
Applicable Percentage in effect from time to time, payable in arrears quarterly
on the last day of each March, June, September and December, commencing
September 30, 2002, and on the Termination Date.
(b) AGENT'S FEES. The Borrower shall pay to the Agent for its own
account such fees as may from time to time be agreed between the Borrower and
the Agent.
SECTION 2.04. OPTIONAL TERMINATION OR REDUCTION OF THE COMMITMENTS. The
Borrower shall have the right, upon at least three Business Days' notice to the
Agent, to terminate in whole or permanently reduce ratably in part the unused
portions of the respective Commitments of the Lenders, PROVIDED that each
partial reduction shall be in the aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof.
SECTION 2.05. REPAYMENT OF ADVANCES. The Borrower shall repay to the
Agent for the ratable account of the Lenders on the Termination Date the
aggregate principal amount of the Advances then outstanding.
SECTION 2.06. INTEREST ON ADVANCES. (a) SCHEDULED INTEREST. The
Borrower shall pay interest on the unpaid principal amount of each Advance owing
to each Lender from the date of such Advance until such principal amount shall
be paid in full, at the following rates per annum:
(i) BASE RATE ADVANCES. During such periods as such Advance is a Base
Rate Advance, a rate per annum equal at all times to the sum of (x) the
Base Rate in effect from time to time PLUS (y) the Applicable Margin in
effect from time to time PLUS (z) the Applicable Utilization Fee in effect
from time to time, payable in arrears quarterly on the last day of each
March, June, September and December during such periods and on the date
such Base Rate Advance shall be Converted or paid in full.
(ii) EURODOLLAR RATE ADVANCES. During such periods as such Advance is a
Eurodollar Rate Advance, a rate per annum equal at all times during each
Interest Period for such Advance to the sum of (x) the Eurodollar Rate for
such Interest Period for such Advance PLUS (y) the Applicable Margin in
effect from time to time PLUS (z) the Applicable Utilization Fee in effect
from time to time, payable in arrears on the last day of such Interest
Period and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every three
months from the first day of such Interest Period and on the date such
Eurodollar Rate Advance shall be Converted or paid in full.
(b) DEFAULT INTEREST. Upon the occurrence and during the continuance of
an Event of Default, the Agent may, and upon the request of the Required Lenders
shall, require the Borrower to pay interest ("DEFAULT INTEREST") on (i) the
unpaid principal amount of each Advance owing to each Lender, payable in arrears
on the dates referred to in clause (a)(i) or (a)(ii) above, at a rate per annum
equal at all times to 2% per annum above the rate per annum required to be paid
on such Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to the
fullest extent permitted by law, the amount of any interest, fee or other amount
payable hereunder that is not paid when due, from the date such amount shall be
due until such amount shall be paid in full, payable in arrears on the date such
amount shall be paid in full and on demand, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid on Base Rate
Advances pursuant to clause (a)(i) above, PROVIDED, HOWEVER, that following
acceleration of the Advances pursuant to Section 6.01, Default Interest shall
accrue and be payable hereunder whether or not previously required by the Agent.
SECTION 2.07. INTEREST RATE DETERMINATION. (a) Each Reference Bank
agrees to furnish to the Agent timely information for the purpose of determining
each Eurodollar Rate. If any one or more of the Reference Banks shall not
furnish such timely information to the Agent for the purpose of determining any
such interest rate,
11
the Agent shall determine such interest rate on the basis of timely information
furnished by the remaining Reference Banks. The Agent shall give prompt notice
to the Borrower and the Lenders of the applicable interest rate determined by
the Agent for purposes of Section 2.06(a)(i) or (ii), and the rate, if any,
furnished by each Reference Bank for the purpose of determining the interest
rate under Section 2.06(a)(ii).
(b) If, with respect to any Eurodollar Rate Advances, the Required
Lenders notify the Agent that the Eurodollar Rate for any Interest Period for
such Advances will not adequately reflect the cost to such Required Lenders of
making, funding or maintaining their respective Eurodollar Rate Advances for
such Interest Period, the Agent shall forthwith so notify the Borrower and the
Lenders, whereupon (i) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance, and (ii) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended until the Agent shall notify
the Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
(c) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the Agent will
forthwith so notify the Borrower and the Lenders and such Advances will
automatically, on the last day of the then existing Interest Period therefor,
Convert into Base Rate Advances.
(d) On the date on which the aggregate unpaid principal amount of
Eurodollar Rate Advances comprising any Borrowing shall be reduced, by payment
or prepayment or otherwise, to less than $5,000,000, such Advances shall
automatically Convert into Base Rate Advances.
(e) Upon the occurrence and during the continuance of any Event of
Default, (i) each Eurodollar Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.
(f) If Telerate Markets Page 3750 is unavailable and fewer than two
Reference Banks furnish timely information to the Agent for determining the
Eurodollar Rate for any Eurodollar Rate Advances,
(i) the Agent shall forthwith notify the Borrower and the Lenders that
the interest rate cannot be determined for such Eurodollar Rate Advances,
(ii) with respect to Eurodollar Rate Advances, each such Advance will
automatically, on the last day of the then existing Interest Period
therefor, Convert into a Base Rate Advance (or if such Advance is then a
Base Rate Advance, will continue as a Base Rate Advance), and
(iii) the obligation of the Lenders to make Eurodollar Rate Advances or
to Convert Advances into Eurodollar Rate Advances shall be suspended until
the Agent shall notify the Borrower and the Lenders that the circumstances
causing such suspension no longer exist.
SECTION 2.08. OPTIONAL CONVERSION OF ADVANCES. The Borrower may on any
Business Day, upon notice given to the Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed
Conversion and subject to the provisions of Sections 2.07 and 2.11, Convert all
Advances of one Type comprising the same Borrowing into Advances of the other
Type; PROVIDED, HOWEVER, that any Conversion of Eurodollar Rate Advances into
Base Rate Advances shall be made only on the last day of an Interest Period for
such Eurodollar Rate Advances, any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.02(b) and no Conversion of any Advances shall result in
more separate Borrowings than permitted under Section 2.02(b). Each such notice
of a Conversion shall, within the restrictions specified above, specify (i) the
date of such Conversion, (ii) the Advances to be Converted, and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for each such Advance. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
12
SECTION 2.09. PREPAYMENTS OF ADVANCES. The Borrower may, upon notice at
least two Business Days' prior to the date of such prepayment, in the case of
Eurodollar Rate Advances, and not later than 11:00 A.M. (New York City time) on
the date of such prepayment, in the case of Base Rate Advances, to the Agent
stating the proposed date and aggregate principal amount of the prepayment, and
if such notice is given the Borrower shall, prepay the outstanding principal
amount of the Advances comprising part of the same Borrowing in whole or ratably
in part, together with accrued interest to the date of such prepayment on the
principal amount prepaid; PROVIDED, HOWEVER, that (x) each partial prepayment
shall be in an aggregate principal amount of $5,000,000 or an integral multiple
of $1,000,000 in excess thereof and (y) in the event of any such prepayment of a
Eurodollar Rate Advance, the Borrower shall be obligated to reimburse the
Lenders in respect thereof pursuant to Section 8.04(c).
SECTION 2.10. INCREASED COSTS. (a) If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender of agreeing to make or
making, funding or maintaining Eurodollar Rate Advances (excluding for purposes
of this Section 2.10 any such increased costs resulting from (i) Taxes or Other
Taxes (as to which Section 2.13 shall govern) and (ii) changes in the basis of
taxation of overall net income or overall gross income by the United States or
by the foreign jurisdiction or state under the laws of which such Lender is
organized or has its Applicable Lending Office or any political subdivision
thereof), then the Borrower shall from time to time, upon demand by such Lender
(with a copy of such demand to the Agent), pay to the Agent for the account of
such Lender additional amounts sufficient to compensate such Lender for such
increased cost; PROVIDED, HOWEVER, that before making any such demand, each
Lender agrees to use reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions) to designate a different Applicable Lending
Office if the making of such a designation would avoid the need for, or reduce
the amount of, such increased cost and would not, in the reasonable judgment of
such Lender, be otherwise disadvantageous to such Lender. A certificate as to
the amount of such increased cost, submitted to the Borrower and the Agent by
such Lender, shall be conclusive and binding for all purposes, absent manifest
error.
(b) If any Lender determines that compliance with any law or regulation
or any guideline or request from any central bank or other governmental
authority (whether or not having the force of law) affects or would affect the
amount of capital required or expected to be maintained by such Lender or any
corporation controlling such Lender and that the amount of such capital is
increased by or based upon the existence of such Lender's commitment to lend
hereunder and other commitments of this type, then, upon demand by such Lender
(with a copy of such demand to the Agent), the Borrower shall pay to the Agent
for the account of such Lender, from time to time as specified by such Lender,
additional amounts sufficient to compensate such Lender or such corporation in
the light of such circumstances, to the extent that such Lender reasonably
determines such increase in capital to be allocable to the existence of such
Lender's commitment to lend hereunder. A certificate as to such amounts
submitted to the Borrower and the Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 2.11. ILLEGALITY. Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Agent that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts that it is unlawful,
for any Lender or its Eurodollar Lending Office to perform its obligations
hereunder to make Eurodollar Rate Advances or to fund or maintain Eurodollar
Rate Advances hereunder, (a) each Eurodollar Rate Advance will automatically,
upon such demand, Convert into a Base Rate Advance and (b) the obligation of the
Lenders to make Eurodollar Rate Advances or to Convert Advances into Eurodollar
Rate Advances shall be suspended until the Agent shall notify the Borrower and
the Lenders that the circumstances causing such suspension no longer exist;
PROVIDED, HOWEVER, that before making any such demand, each Lender agrees to use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Eurodollar Lending Office if the making
of such a designation would allow such Lender or its Eurodollar Lending Office
to continue to perform its obligations to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances and would not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender.
SECTION 2.12. PAYMENTS AND COMPUTATIONS. (a) The Borrower shall make
each payment hereunder, irrespective of any right of counterclaim or set-off,
not later than 11:00 A.M. (New York City time) on the day when due in U.S.
dollars to the Agent at the Agent's Account in same day funds. The Agent will
promptly
13
thereafter cause to be distributed like funds relating to the payment of
principal or interest or facility fees ratably (other than amounts payable
pursuant to Section 2.10, 2.13 or 8.04(c)) to the Lenders for the account of
their respective Applicable Lending Offices, and like funds relating to the
payment of any other amount payable to any Lender to such Lender for the account
of its Applicable Lending Office, in each case to be applied in accordance with
the terms of this Agreement. Upon any Assuming Lender becoming a Lender
hereunder as a result of a Commitment Increase pursuant to Section 2.17 or an
extension of the Termination Date pursuant to Section 2.18, and upon the Agent's
receipt of such Lender's Assumption Agreement and recording of the information
contained therein in the Register, from and after the applicable Increase Date
or Extension Date, as the case may be, the Agent shall make all payments
hereunder and under any Notes issued in connection therewith in respect of the
interest assumed thereby to the Assuming Lender. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 8.07(c), from and after the effective date
specified in such Assignment and Acceptance, the Agent shall make all payments
hereunder and under the Notes in respect of the interest assigned thereby to the
Lender assignee thereunder, and the parties to such Assignment and Acceptance
shall make all appropriate adjustments in such payments for periods prior to
such effective date directly between themselves.
(b) The Borrower hereby authorizes each Lender, if and to the extent
payment owed to such Lender is not made when due hereunder or under the Note
held by such Lender, to charge from time to time against any or all of the
Borrower's accounts with such Lender any amount so due.
(c) All computations of interest based on the Base Rate shall be made
by the Agent on the basis of a year of 365 or 366 days, as the case may be, and
all computations of interest based on the Eurodollar Rate or the Federal Funds
Rate and of facility fees shall be made by the Agent on the basis of a year of
360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest or
facility fees are payable. Each determination by the Agent of an interest rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility fee, as the case
may be; PROVIDED, HOWEVER, that, if such extension would cause payment of
interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
(e) Unless the Agent shall have received notice from the Borrower prior
to the date on which any payment is due to the Lenders hereunder that the
Borrower will not make such payment in full, the Agent may assume that the
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent the Borrower shall not have so made such payment in full to the Agent,
each Lender shall repay to the Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Rate.
SECTION 2.13. TAXES. (a) Any and all payments by the Borrower to or for
the account of any Lender or the Agent hereunder or under the Notes or any other
documents to be delivered hereunder shall be made, in accordance with Section
2.12 or the applicable provisions of such other documents, free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
EXCLUDING, in the case of each Lender and the Agent, taxes imposed on its
overall net income, and franchise taxes imposed on it in lieu of net income
taxes, by the jurisdiction under the laws of which such Lender or the Agent (as
the case may be) is organized or any political subdivision thereof and, in the
case of each Lender, taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes, by the jurisdiction of such
Lender's Applicable Lending Office or any political subdivision thereof (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "TAXES"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note or any other documents to be delivered hereunder to any Lender or the
Agent, (i) the sum payable shall be increased as may be necessary so that
14
after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.13) such Lender or the Agent (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or under the Notes or any
other documents to be delivered hereunder or from the execution, delivery or
registration of, performing under, or otherwise with respect to, this Agreement
or the Notes or any other documents to be delivered hereunder (hereinafter
referred to as "OTHER TAXES").
(c) The Borrower shall indemnify each Lender and the Agent for and hold
it harmless against the full amount of Taxes or Other Taxes (including, without
limitation, taxes of any kind imposed or asserted by any jurisdiction on amounts
payable under this Section 2.13) imposed on or paid by such Lender or the Agent
(as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall
be made within 30 days from the date such Lender or the Agent (as the case may
be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
shall furnish to the Agent, at its address referred to in Section 8.02, the
original or a certified copy of a receipt evidencing such payment to the extent
such a receipt is issued therefor, or other written proof of payment thereof
that is reasonably satisfactory to the Agent.
(e) Any Lender claiming any additional amounts payable pursuant to this
Section 2.13 agrees to use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
Eurodollar Lending Office (or to take such other action) if the making of such a
change (or the taking of such other action) would avoid the need for, or reduce
the amount of, any such additional amounts that may thereafter accrue and would
not, in the reasonable judgment of such Lender, be otherwise disadvantageous to
such Lender.
SECTION 2.14. SHARING OF PAYMENTS, ETC. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Advances owing to it (other than
pursuant to Section 2.10, 2.13 or 8.04(c)) in excess of its ratable share of
payments on account of the Advances obtained by all the Lenders, such Lender
shall forthwith purchase from the other Lenders such participations in the
Advances owing to them as shall be necessary to cause such purchasing Lender to
share the excess payment ratably with each of them; PROVIDED, HOWEVER, that if
all or any portion of such excess payment is thereafter recovered from such
purchasing Lender, such purchase from each Lender shall be rescinded and such
Lender shall repay to the purchasing Lender the purchase price to the extent of
such recovery together with an amount equal to such Lender's ratable share
(according to the proportion of (i) the amount of such Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.14
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Borrower in the amount of such
participation.
SECTION 2.15. EVIDENCE OF DEBT. (a) 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 Advance owing to
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder in respect of
Advances. The Borrower agrees that upon notice by any Lender to the Borrower
(with a copy of such notice to the Agent) to the effect that a Note is required
or appropriate in order for such Lender to evidence (whether for purposes of
pledge, enforcement or otherwise) the Advances owing to, or to be made by, such
Lender, the Borrower shall promptly execute and deliver to such Lender a Note
payable to the order of such Lender in a principal amount up to the Commitment
of such Lender.
15
(b) The Register maintained by the Agent pursuant to Section 8.07(d)
shall include a control account, and a subsidiary account for each Lender, in
which accounts (taken together) shall be recorded (i) the date and amount of
each Borrowing made hereunder, the Type of Advances comprising such Borrowing
and, if appropriate, the Interest Period applicable thereto, (ii) the terms of
each Assumption Agreement and each Assignment and Acceptance delivered to and
accepted by it, (iii) the amount of any principal or interest due and payable or
to become due and payable from the Borrower to each Lender hereunder and (iv)
the amount of any sum received by the Agent from the Borrower hereunder and each
Lender's share thereof.
(c) Entries made in good faith by the Agent in the Register pursuant to
subsection (b) above, and by each Lender in its account or accounts pursuant to
subsection (a) above, shall be PRIMA FACIE evidence of the amount of principal
and interest due and payable or to become due and payable from the Borrower to,
in the case of the Register, each Lender and, in the case of such account or
accounts, such Lender, under this Agreement, absent manifest error; PROVIDED,
HOWEVER, that the failure of the Agent or such Lender to make an entry, or any
finding that an entry is incorrect, in the Register or such account or accounts
shall not limit or otherwise affect the obligations of the Borrower under this
Agreement.
SECTION 2.16. USE OF PROCEEDS. The proceeds of the Advances shall be
available (and the Borrower agrees that it shall use such proceeds) solely for
general corporate purposes of the Borrower and its Subsidiaries.
SECTION 2.17. INCREASE IN THE AGGREGATE COMMITMENTS. (a) The Borrower
may, at any time but in any event not more than once in any calendar year prior
to the Termination Date, by notice to the Agent, request that the aggregate
amount of the Commitment be increased by an amount of $10,000,000 or an integral
multiple thereof (each a "COMMITMENT INCREASE") to be effective as of a date
that is at least 90 days prior to the scheduled Termination Date then in effect
(the "INCREASE DATE") as specified in the related notice to the Agent; PROVIDED,
HOWEVER that (i) in no event shall the aggregate amount of the Commitments at
any time exceed $250,000,000 and (ii) on the date of any request by the Borrower
for a Commitment Increase and on the related Increase Date (x) the applicable
conditions set forth in Article III shall be satisfied and (y) the Public Debt
Rating is BBB+ or better from S&P and Baa1 or better from ▇▇▇▇▇'▇.
(b) The Agent shall promptly notify the Lenders of a request by the
Borrower for a Commitment Increase, which notice shall include (i) the proposed
amount of such requested Commitment Increase, (ii) the proposed Increase Date
and (iii) the date by which Lenders wishing to participate in the Commitment
Increase must commit to an increase in the amount of their respective
Commitments (the "COMMITMENT DATE"). Each Lender that is willing to participate
in such requested Commitment Increase (each an "INCREASING LENDER") shall, in
its sole discretion, give written notice to the Agent on or prior to the
Commitment Date of the amount by which it is willing to increase its Commitment.
If the Lenders notify the Agent that they are willing to increase the amount of
their respective Commitments by an aggregate amount that exceeds the amount of
the requested Commitment Increase, the requested Commitment Increase shall be
allocated among the Lenders willing to participate therein in such amounts as
are agreed between the Borrower and the Agent.
(c) Promptly following each Commitment Date, the Agent shall notify the
Borrower as to the amount, if any, by which the Lenders are willing to
participate in the requested Commitment Increase. If the aggregate amount by
which the Lenders are willing to participate in any requested Commitment
Increase on any such Commitment Date is less than the requested Commitment
Increase, then the Borrower may extend offers to one or more Eligible Assignees
to participate in any portion of the requested Commitment Increase that has not
been committed to by the Lenders as of the applicable Commitment Date; PROVIDED,
HOWEVER, that the Commitment of each such Eligible Assignee shall be in an
amount of not less than $10,000,000.
(d) On each Increase Date, each Eligible Assignee that accepts an offer
to participate in a requested Commitment Increase in accordance with Section
2.17(b) (each such Eligible Assignee and each Eligible Assignee that agrees to
an extension of the Termination Date in accordance with Section 2.18(c), an
"ASSUMING LENDER") shall become a Lender party to this Agreement as of such
Increase Date and the Commitment of each Increasing Lender for such requested
Commitment Increase shall be so increased by such amount (or by the amount
allocated to such Lender pursuant to the last sentence of Section 2.17(b)) as of
such Increase Date; PROVIDED, HOWEVER, that the Agent shall have received on or
before such Increase Date the following, each dated such date:
16
(i) (A) certified copies of resolutions of the Board of Directors of
the Borrower or the Executive Committee of such Board approving the
Commitment Increase and the corresponding modifications to this Agreement
and (B) an opinion of counsel for the Borrower (which may be in-house
counsel), in substantially the form of Exhibit E hereto;
(ii) an assumption agreement from each Assuming Lender, if any, in form
and substance satisfactory to the Borrower and the Agent (each an
"ASSUMPTION AGREEMENT"), duly executed by such Eligible Assignee, the Agent
and the Borrower; and
(iii) confirmation from each Increasing Lender of the increase in the
amount of its Commitment in a writing satisfactory to the Borrower and the
Agent.
On each Increase Date, upon fulfillment of the conditions set forth in the
immediately preceding sentence of this Section 2.17(d), the Agent shall notify
the Lenders (including, without limitation, each Assuming Lender) and the
Borrower, on or before 1:00 P.M. (New York City time), by telecopier or telex,
of the occurrence of the Commitment Increase to be effected on such Increase
Date and shall record in the Register the relevant information with respect to
each Increasing Lender and each Assuming Lender on such date.
SECTION 2.18. EXTENSION OF TERMINATION DATE. (a) At least 30 days but
not more than 45 days prior to the Termination Date, the Borrower, by written
notice to the Agent, may request an extension of the Termination Date in effect
at such time by 364 days from its then scheduled expiration. The Agent shall
promptly notify each Lender of such request, and each Lender shall in turn, in
its sole discretion, not later than 20 days prior to the Termination Date,
notify the Borrower and the Agent in writing as to whether such Lender will
consent to such extension. If any Lender shall fail to notify the Agent and the
Borrower in writing of its consent to any such request for extension of the
Termination Date at least 20 days prior to the Termination Date, such Lender
shall be deemed to be a Non-Consenting Lender with respect to such request. The
Agent shall notify the Borrower not later than 15 days prior to the Termination
Date of the decision of the Lenders regarding the Borrower's request for an
extension of the Termination Date.
(b) If all the Lenders consent in writing to any such request in
accordance with subsection (a) of this Section 2.18, the Termination Date in
effect at such time shall, effective as at the Termination Date (the "EXTENSION
DATE"), be extended for 364 days; PROVIDED that on each Extension Date the
applicable conditions set forth in Article III shall be satisfied. If less than
all of the Lenders consent in writing to any such request in accordance with
subsection (a) of this Section 2.18, the Termination Date in effect at such time
shall, effective as at the applicable Extension Date and subject to subsection
(d) of this Section 2.18, be extended as to those Lenders that so consented
(each a "CONSENTING LENDER") but shall not be extended as to any other Lender
(each a "NON-CONSENTING LENDER"). To the extent that the Termination Date is not
extended as to any Lender pursuant to this Section 2.18 and the Commitment of
such Lender is not assumed in accordance with subsection (c) of this Section
2.18 on or prior to the applicable Extension Date, the Commitment of such
Non-Consenting Lender shall automatically terminate in whole on such unextended
Termination Date without any further notice or other action by the Borrower,
such Lender or any other Person; PROVIDED that such Non-Consenting Lender's
rights under Sections 2.10, 2.13 and 8.04, and its obligations under Section
7.05, shall survive the Termination Date for such Lender as to matters occurring
prior to such date. It is understood and agreed that no Lender shall have any
obligation whatsoever to agree to any request made by the Borrower for any
requested extension of the Termination Date.
(c) If less than all of the Lenders consent to any such request
pursuant to subsection (a) of this Section 2.18, the Agent shall promptly so
notify the Consenting Lenders, and each Consenting Lender may, in its sole
discretion, give written notice to the Agent not later than 10 days prior to the
Termination Date of the amount of the Non-Consenting Lenders' Commitments for
which it is willing to accept an assignment. If the Consenting Lenders notify
the Agent that they are willing to accept assignments of Commitments in an
aggregate amount that exceeds the amount of the Commitments of the
Non-Consenting Lenders, such Commitments shall be allocated among the Consenting
Lenders willing to accept such assignments in such amounts as are agreed between
the Borrower and the Agent. If after giving effect to the assignments of
Commitments described above there remain any Commitments of Non-Consenting
Lenders, the Borrower may arrange for one or more Consenting Lenders or other
Eligible Assignees as Assuming Lenders to assume, effective as of the Extension
Date, any Non-Consenting
17
Lender's Commitment and all of the obligations of such Non-Consenting Lender
under this Agreement thereafter arising, without recourse to or warranty by, or
expense to, such Non-Consenting Lender; PROVIDED, HOWEVER, that the amount of
the Commitment of any such Assuming Lender as a result of such substitution
shall in no event be less than $10,000,000 unless the amount of the Commitment
of such Non-Consenting Lender is less than $10,000,000, in which case such
Assuming Lender shall assume all of such lesser amount; and PROVIDED FURTHER
that:
(i) any such Consenting Lender or Assuming Lender shall have paid to
such Non-Consenting Lender (A) the aggregate principal amount of, and any
interest accrued and unpaid to the effective date of the assignment on, the
outstanding Advances, if any, of such Non-Consenting Lender PLUS (B) any
accrued but unpaid facility fees owing to such Non-Consenting Lender as of
the effective date of such assignment;
(ii) all additional costs reimbursements, expense reimbursements and
indemnities payable to such Non-Consenting Lender, and all other accrued
and unpaid amounts owing to such Non-Consenting Lender hereunder, as of the
effective date of such assignment shall have been paid to such
Non-Consenting Lender; and
(iii) with respect to any such Assuming Lender, the applicable
processing and recordation fee required under Section 8.07(a) for such
assignment shall have been paid;
PROVIDED FURTHER that such Non-Consenting Lender's rights under Sections 2.10,
2.13 and 8.04, and its obligations under Section 7.05, shall survive such
substitution as to matters occurring prior to the date of substitution. At least
three Business Days prior to any Extension Date, (A) each such Assuming Lender,
if any, shall have delivered to the Borrower and the Agent an Assumption
Agreement, duly executed by such Assuming Lender, such Non-Consenting Lender,
the Borrower and the Agent, (B) any such Consenting Lender shall have delivered
confirmation in writing satisfactory to the Borrower and the Agent as to the
increase in the amount of its Commitment and (C) each Non-Consenting Lender
being replaced pursuant to this Section 2.18 shall have delivered to the Agent
any Note or Notes held by such Non-Consenting Lender. Upon the payment or
prepayment of all amounts referred to in clauses (i), (ii) and (iii) of the
immediately preceding sentence, each such Consenting Lender or Assuming Lender,
as of the Extension Date, will be substituted for such Non-Consenting Lender
under this Agreement and shall be a Lender for all purposes of this Agreement,
without any further acknowledgment by or the consent of the other Lenders, and
the obligations of each such Non-Consenting Lender hereunder shall, by the
provisions hereof, be released and discharged.
(d) If (after giving effect to any assignments or assumptions pursuant
to subsection (c) of this Section 2.18) Lenders having Commitments equal to at
least 50% of the Commitments in effect immediately prior to the Extension Date
consent in writing to a requested extension (whether by execution or delivery of
an Assumption Agreement or otherwise) not later than one Business Day prior to
such Extension Date, the Agent shall so notify the Borrower, and, subject to the
satisfaction of the applicable conditions in Article III, the Termination Date
then in effect shall be extended for the additional 364-day period as described
in subsection (a) of this Section 2.18, and all references in this Agreement,
and in the Notes, if any, to the "TERMINATION DATE" shall, with respect to each
Consenting Lender and each Assuming Lender for such Extension Date, refer to the
Termination Date as so extended. Promptly following each Extension Date, the
Agent shall notify the Lenders (including, without limitation, each Assuming
Lender) of the extension of the scheduled Termination Date in effect immediately
prior thereto and shall thereupon record in the Register the relevant
information with respect to each such Consenting Lender and each such Assuming
Lender.
ARTICLE III
CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS OF SECTION 2.01.
Section 2.01 of this Agreement shall become effective on and as of the first
date (the "EFFECTIVE DATE") on which the following conditions precedent have
been satisfied:
18
(a) There shall have occurred no Material Adverse Change since April
24, 2002.
(b) There shall exist no action, suit, investigation, litigation or
proceeding affecting the Borrower or any of its Subsidiaries pending or
threatened before any court, governmental agency or arbitrator that (i)
could be reasonably likely to have a Material Adverse Effect or (ii)
purports to affect the legality, validity or enforceability of this
Agreement or any Note or the consummation of the transactions contemplated
hereby.
(c) Nothing shall have come to the attention of the Lenders during the
course of their due diligence investigation to lead them to believe that
the Information Memorandum was or has become misleading, incorrect or
incomplete in any material respect; without limiting the generality of the
foregoing, the Lenders shall have been given such access to the management,
records, books of account, contracts and properties of the Borrower and its
Subsidiaries as they shall have requested.
(d) All governmental and third party consents and approvals necessary
in connection with the transactions contemplated hereby shall have been
obtained (without the imposition of any conditions that are not acceptable
to the Lenders) and shall remain in effect, and no law or regulation shall
be applicable in the reasonable judgment of the Lenders that restrains,
prevents or imposes materially adverse conditions upon the transactions
contemplated hereby.
(e) The Borrower shall have notified each Lender and the Agent in
writing as to the proposed Effective Date, and the Agent shall have
confirmed to the Borrower in writing that the Effective Date has occurred.
(f) The Borrower shall have paid all accrued fees and expenses of the
Agent and the Lenders (including the accrued fees and expenses of counsel
to the Agent) that have been previously invoiced to the Borrower.
(g) On the Effective Date, the following statements shall be true and
the Agent shall have received for the account of each Lender a certificate
signed by a duly authorized officer of the Borrower, dated the Effective
Date, stating that:
(i) The representations and warranties contained in Section
4.01 are correct on and as of the Effective Date, and
(ii) No event has occurred and is continuing that constitutes
a Default.
(h) The Agent shall have received on or before the Effective Date the
following, each dated such day, in form and substance satisfactory to the
Agent and (except for the Notes) in sufficient copies for each Lender:
(i) The Notes to the order of the Lenders to the extent
requested by any Lender pursuant to Section 2.15.
(ii) Certified copies of the resolutions of the Board of
Directors of the Borrower approving this Agreement and the Notes, and
of all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect to this Agreement and the
Notes.
(iii) A certificate of the Secretary or an Assistant Secretary
of the Borrower certifying the names and true signatures of the
officers of the Borrower authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder.
19
(iv) A favorable opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇, Bermuda
counsel to the Borrower and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, New York counsel for
the Borrower, substantially in the form of Exhibits D-1 and D-2 hereto,
respectively, and as to such other matters as any Lender through the
Agent may reasonably request.
(v) A favorable opinion of Shearman & Sterling, counsel for
the Agent, in form and substance satisfactory to the Agent.
(i) The Borrower shall have received net proceeds of not less than
$850,000,000 from the public sale of equity interests.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING, COMMITMENT
INCREASE AND EXTENSION DATE. The obligation of each Lender to make an Advance on
the occasion of each Borrowing, each Commitment Increase and each extension of
Commitments pursuant to Section 2.18 shall be subject to the conditions
precedent that the Effective Date shall have occurred and on the date of such
Borrowing, the applicable Increase Date or the applicable Extension Date (a) the
following statements shall be true (and each of the giving of the applicable
Notice of Borrowing, request for Commitment Increase, request for Commitment
Extension and the acceptance by the Borrower of the proceeds of such Borrowing
shall constitute a representation and warranty by the Borrower that on the date
of such Borrowing, such Increase Date or such Extension Date such statements are
true):
(i) the representations and warranties contained in Section 4.01 are
correct on and as of such date, before and after giving effect to such
Borrowing, such Commitment Increase or such Extension Date and to the
application of the proceeds therefrom, as though made on and as of such
date, and
(ii) no event has occurred and is continuing, or would result from such
Borrowing, such Commitment Increase or such Extension Date or from the
application of the proceeds therefrom, that constitutes a Default;
and (b) with respect to any Commitment Increase or Commitment extension, the
Agent shall have received such other approvals, opinions or documents as any
Lender through the Agent may reasonably request.
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by this Agreement
shall have received notice from such Lender prior to the date that the Borrower,
by notice to the Lenders, designates as the proposed Effective Date, specifying
its objection thereto. The Agent shall promptly notify the Lenders of the
occurrence of the Effective Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The
Borrower represents and warrants as follows:
(a) Each of the Borrower and its Subsidiaries (i) is duly organized,
validly existing and (to the extent applicable) in good standing under the
laws of its jurisdiction of incorporation or organization, (ii) is duly
qualified to do business and (to the extent applicable) in good standing in
each jurisdiction where, because of the nature of its activities or
properties, such qualification is required except where the failure to
qualify would not have a Material Adverse Effect, (iii) has the requisite
corporate power and authority and the right to own and operate its
properties, to lease the property it operates under lease, and to conduct
its business as now and proposed to be conducted, and (iv) except as
disclosed in the Registration Statement, has obtained all material
licenses, permits, consents or approvals from or by, and has made all
20
filings with, and given all notices to, all governmental authorities having
jurisdiction, to the extent required for such ownership, operation and
conduct (including, without limitation, the consummation of the
transactions contemplated by this Agreement) as to each of the foregoing,
except where the failure to do so would not have a Material Adverse Effect.
(b) The execution, delivery and performance by the Borrower of this
Agreement and the Notes to be delivered by it, and the consummation of the
transactions contemplated hereby, are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action, and do
not contravene (i) the Borrower's charter or by-laws or (ii) law or any
contractual restriction binding on or affecting the Borrower.
(c) No authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body or any other
third party is required for the due execution, delivery and performance by
the Borrower of this Agreement or the Notes to be delivered by it, except
for those authorizations, approvals, actions, notices and filings that have
been duly obtained, taken, given or made and are in full force and effect.
(d) This Agreement has been, and each of the Notes to be delivered by
it when delivered hereunder will have been, duly executed and delivered by
the Borrower. This Agreement is, and each of the Notes when delivered
hereunder will be, the legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with their respective terms,
subject to (i) the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors' rights
generally, (ii) the effect of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law.
(e) The Consolidated pro forma balance sheet of the Borrower and its
Subsidiaries as at April 24, 2002, copies of which have been furnished to
each Lender, fairly present the pro forma Consolidated financial condition
of the Borrower and its Subsidiaries as at such date, giving effect to the
transactions contemplated hereby, all in accordance with generally accepted
accounting principles consistently applied. Since April 24, 2002, there has
been no Material Adverse Change.
(f) The description of the Quoted Share Retrocession Agreements (as
defined in the Registration Statement) as set forth in the Registration
Statement is not misleading in any material respect.
(g) There is no pending or, to the knowledge of the Borrower,
threatened action, suit, investigation, litigation or proceeding,
including, without limitation, any Environmental Action, affecting the
Borrower or any of its Subsidiaries before any court, governmental agency
or arbitrator that (i) could be reasonably likely to have a Material
Adverse Effect or (ii) purports to affect the legality, validity or
enforceability of this Agreement or any Note or the consummation of the
transactions contemplated hereby.
(h) The Borrower is not engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve
System), and no proceeds of any Advance will be used to purchase or carry
any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock.
(i) The Borrower is not an "investment company", or a company
"controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended.
21
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance shall
remain unpaid or any Lender shall have any Commitment hereunder, the Borrower
will:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable laws,
rules, regulations and orders, such compliance to include, without
limitation, compliance with ERISA and Environmental Laws, except to the
extent that failure to so comply would not reasonably be expected to have a
material negative impact on the Borrower and its Subsidiaries taken as a
whole.
(b) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges or levies imposed upon
it or upon its property and (ii) all lawful claims that, if unpaid, might
by law become a Lien upon its property; provided, HOWEVER, that neither the
Borrower nor any of its Subsidiaries shall be required to pay or discharge
any such tax, assessment, charge or claim that is being contested in good
faith and by proper proceedings and as to which appropriate reserves are
being maintained.
(c) MAINTENANCE OF INSURANCE. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks
as is usually carried by companies engaged in similar businesses and owning
similar properties in the same general areas in which the Borrower or such
Subsidiary operates.
(d) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and maintain,
and cause each of its Subsidiaries to preserve and maintain, its corporate
existence, rights (charter and statutory) and franchises; PROVIDED,
HOWEVER, that the Borrower and its Subsidiaries may consummate any merger
or consolidation permitted under Section 5.02(b) and PROVIDED FURTHER that
neither the Borrower nor any of its Subsidiaries shall be required to
preserve any right or franchise if the Board of Directors of the Borrower
or such Subsidiary shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Borrower or such
Subsidiary, as the case may be, and that the loss thereof is not
disadvantageous in any material respect to the Borrower, such Subsidiary or
the Lenders.
(e) VISITATION RIGHTS. At any reasonable time and from time to time,
permit the Agent or any of the Lenders or any agents or representatives
thereof, to examine and make copies of and abstracts from the records and
books of account of, and visit the properties of, the Borrower and any of
its Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers or
directors and with their independent certified public accountants.
(f) KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries to keep,
proper books of record and account, in which full and correct entries shall
be made of all financial transactions and the assets and business of the
Borrower and each such Subsidiary in accordance with generally accepted
accounting principles in effect from time to time and, in the case of an
Insurance Subsidiary, in accordance with SAP.
(g) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and cause
each of its Subsidiaries to maintain and preserve, all of its properties
that are used or useful in the conduct of its business in good working
order and condition, ordinary wear and tear excepted.
(h) TRANSACTIONS WITH AFFILIATES. Except as disclosed in the
Registration Statement, conduct, and cause each of its Subsidiaries to
conduct, all transactions otherwise permitted under this Agreement with any
of their Affiliates on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate.
(i) REPORTING REQUIREMENTS. Furnish to the Lenders:
22
(i) as soon as available and in any event within 45 days after
the end of each of the first three quarters of each fiscal year of the
Borrower, the Consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such quarter and Consolidated statements
of income and cash flows of the Borrower and its Subsidiaries for the
period commencing at the end of the previous fiscal year and ending
with the end of such quarter, duly certified (subject to year-end audit
adjustments) by the chief financial officer of the Borrower as having
been prepared in accordance with generally accepted accounting
principles and certificates of the chief financial officer of the
Borrower as to compliance with the terms of this Agreement and setting
forth in reasonable detail the calculations necessary to demonstrate
compliance with Section 5.03, PROVIDED that in the event of any change
in generally accepted accounting principles used in the preparation of
such financial statements, the Borrower shall also provide, if
necessary for the determination of compliance with Section 5.03, a
statement of reconciliation conforming such financial statements to
GAAP;
(ii) as soon as available and in any event within 90 days
after the end of each fiscal year of the Borrower, a copy of the annual
audit report for such year for the Borrower and its Subsidiaries,
containing the Consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such fiscal year and Consolidated
statements of income and cash flows of the Borrower and its
Subsidiaries for such fiscal year, in each case accompanied by an
opinion acceptable to the Required Lenders by KPMG LLP or other
independent public accountants acceptable to the Required Lenders and
certificates of the chief financial officer of the Borrower as to
compliance with the terms of this Agreement and setting forth in
reasonable detail the calculations necessary to demonstrate compliance
with Section 5.03, PROVIDED that in the event of any change in
generally accepted accounting principles used in the preparation of
such financial statements, the Borrower shall also provide, if
necessary for the determination of compliance with Section 5.03, a
statement of reconciliation conforming such financial statements to
GAAP;
(iii) within 15 days after the date filed with the Authority
for each of its fiscal years, a copy of the Annual Statement of each
Insurance Subsidiary for each fiscal year commencing on or after
December 31, 2002, for such fiscal year, if any, required by the
Authority to be filed, each of which statements delivered to be
prepared in accordance with SAP and accompanied by the certification of
the chief financial officer or chief executive officer of such
Insurance Subsidiary that such financial statement is complete and
correct and presents fairly in accordance with SAP the financial
position of such Insurance Subsidiary for the period then ended.
(iv) within five Business Days of receipt, a copy of any
financial examination reports by a governmental authority with respect
to its Insurance Subsidiaries relating to the insurance business of its
Insurance Subsidiaries (when, and if, prepared); PROVIDED, the Borrower
shall only be required to deliver any interim report hereunder at such
time as Borrower has knowledge that a final report will not be issued
and delivered to the Agent within 90 days of any such interim report.
(v) copies of all filings (other than nonmaterial tax and
insurance rate and other ministerial regulatory filings) with
governmental authorities by the Borrower or any Subsidiary not later
than five Business Days after such filings are made, including, without
limitation, filings which seek approval of governmental authorities
with respect to transactions between the Borrower or such Subsidiary
and its Affiliates.
(vi) within five Business Days of such notice, notice of
proposed or actual suspension, termination or revocation of any
material License of any Insurance Subsidiary by any governmental
authority or of receipt of notice from any governmental authority
notifying the Borrower or any Insurance Subsidiary of a hearing
relating to such a suspension, termination or revocation, including any
request by a governmental authority which commits the Borrower or any
Insurance Subsidiary to take, or refrain from taking, any action or
which otherwise materially
23
and adversely affects the authority of the Borrower or any Insurance
Subsidiary to conduct its business.
(vii) within five Business Days of such notice, notice of any
pending or threatened investigation or regulatory proceeding (other
than routine periodic investigations or reviews) by any governmental
authority concerning the business, practices or operations of the
Borrower or any Insurance Subsidiary.
(viii) promptly, notice of any actual or, to the best of the
Borrower's knowledge, proposed material changes in the Insurance Code
governing the investment or dividend practices of any Insurance
Subsidiary.
(ix) as soon as possible and in any event within five days
after any senior officer becomes aware or should have become aware of
the occurrence of each Default continuing on the date of such
statement, a statement of the chief financial officer of the Borrower
setting forth details of such Default and the action that the Borrower
has taken and proposes to take with respect thereto;
(x) promptly after the sending or filing thereof, copies of
all reports that the Borrower sends to any of its securityholders, and
copies of all reports and registration statements that the Borrower or
any Subsidiary files with the Securities and Exchange Commission or any
national securities exchange;
(xi) promptly after the commencement thereof, notice of all
actions and proceedings before any court, governmental agency or
arbitrator affecting the Borrower or any of its Subsidiaries of the
type described in Section 4.01(f); and
(xii) such other information respecting the Borrower or any of
its Subsidiaries as any Lender through the Agent may from time to time
reasonably request.
Reports and financial statements required to be delivered by Borrower
pursuant to clauses (i), (ii), (iii), (v) and (vi) of this subsection (i)
shall be deemed to have been delivered on the date on which the Borrower
posts such reports, or reports containing such financial statements, on its
website on the Internet at ▇▇▇.▇▇▇.▇▇▇ or at such other website identified
by the Borrower in a notice to the Agent and the Lenders and that is
accessible by the Lenders without charge; PROVIDED that the Borrower shall
deliver paper copies of such information to any Lender promptly upon
request of such Lender through the Agent and PROVIDED FURTHER that the
Lenders shall be deemed to have received the information specified in
clauses (i) through (vi) of this subsection (i) on the date (x) such
information is posted at the website of the Agent identified from time to
time by the Agent to the Lenders and the Borrower and (y) such posting is
notified to the Lenders (it being understood that the Borrower shall have
satisfied the timing obligations imposed by those clauses as of the date
such information is delivered to the Agent).
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, the Borrower will not:
(a) LIENS, ETC. Create or suffer to exist, or permit any of its
Subsidiaries to create or suffer to exist, any Lien on or with respect to
any of its properties, whether now owned or hereafter acquired, or assign,
or permit any of its Subsidiaries to assign, any right to receive income,
other than:
(i) Permitted Liens,
(ii) purchase money Liens upon or in any real property or
equipment acquired or held by the Borrower or any Subsidiary in the
ordinary course of business to secure the purchase price of such
property or equipment or to secure Debt incurred solely for the purpose
of financing
24
the acquisition of such property or equipment, or Liens existing on
such property or equipment at the time of its acquisition (other than
any such Liens created in contemplation of such acquisition that were
not incurred to finance the acquisition of such property) or
extensions, renewals or replacements of any of the foregoing for the
same or a lesser amount, PROVIDED, HOWEVER, that no such Lien shall
extend to or cover any properties of any character other than the real
property or equipment being acquired, and no such extension, renewal or
replacement shall extend to or cover any properties not theretofore
subject to the Lien being extended, renewed or replaced,
(iii) Liens on Invested Assets pursuant to trust, letter of
credit or other security arrangements in connection with Reinsurance
Agreements or Primary Policies, and
(iv) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Borrower or any
Subsidiary of the Borrower or becomes a Subsidiary of the Borrower;
PROVIDED that such Liens were not created in contemplation of such
merger, consolidation or acquisition and do not extend to any assets
other than those of the Person so merged into or consolidated with the
Borrower or such Subsidiary or acquired by the Borrower or such
Subsidiary,
(v) other Liens securing Debt in an aggregate principal amount
not to exceed $10,000,000 at any time outstanding ,
(vi) the replacement, extension or renewal of any Lien
permitted by clause (iii) above upon or in the same property
theretofore subject thereto or the replacement, extension or renewal
(without increase in the amount or change in any direct or contingent
obligor) of the Debt secured thereby.
(b) MERGERS, ETC. Merge or consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to, any Person, or permit any of its
Subsidiaries to do so, except that any Subsidiary of the Borrower may merge
or consolidate with or into, or dispose of assets to, any other Subsidiary
of the Borrower, and except that any Subsidiary of the Borrower may merge
into or dispose of assets to the Borrower, PROVIDED, in each case, that no
Default shall have occurred and be continuing at the time of such proposed
transaction or would result therefrom.
(c) SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise dispose
of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise
dispose of, any assets, or grant any option or other right to purchase,
lease or otherwise acquire any assets if the assets involved in any such
transaction or series of related transactions (other than investment
transactions in the ordinary course of business) represent more than 10% of
the consolidated total assets of the Borrower and its consolidated
Subsidiaries as set forth on the consolidated balance sheet of the Borrower
and its consolidated Subsidiaries most recently furnished to the Agent
hereunder.
(d) ACCOUNTING CHANGES. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in accounting policies or
reporting practices, except as required or permitted by generally accepted
accounting principles or SAP.
(e) CHANGE IN NATURE OF BUSINESS. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
considered as a whole, as the business of the Borrower and its Subsidiaries
is described in the Registration Statement.
(f) SUBSIDIARY DEBT. Permit any of its Subsidiaries to create or suffer
to exist, any Debt other than:
(i) Debt owed to the Borrower or to a wholly owned Subsidiary
of the Borrower,
25
(ii) Debt secured by (x) Liens permitted by Section 5.02(a)
(other than Section 5.02(a)(iii)) aggregating for all of the Borrower's
Subsidiaries not more than $10,000,000 at any one time outstanding and
(y) Liens permitted by Section 5.02(a)(iii),
(iii) unsecured Debt incurred in the ordinary course of
business aggregating for all of the Borrower's Subsidiaries not more
than $10,000,000 at any one time outstanding,
(iv) Debt in respect of Hedge Agreements incurred in the
ordinary course of business, and
(v) endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business.
SECTION 5.03. FINANCIAL COVENANTS. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, the Borrower will:
(a) TANGIBLE NET WORTH. Maintain an excess of Consolidated total
tangible assets over Consolidated total liabilities of not less than an
amount equal to 70% of the Borrower's Consolidated tangible net assets over
Consolidated total liabilities on the closing date of the Borrower's
initial sale of equity to the public at all times.
(b) LEVERAGE RATIO. Maintain a ratio of Consolidated Debt for Borrowed
Money (other than Debt secured by Liens permitted by Section 5.02(a)(iii))
to Consolidated tangible net worth of not greater than 0.30 : 1.00.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following events
("EVENTS OF DEFAULT") shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Advance when
the same becomes due and payable; or the Borrower shall fail to pay any
interest on any Advance or make any other payment of fees or other amounts
payable under this Agreement or any Note within three Business Days after
the same becomes due and payable; or
(b) Any representation or warranty made by the Borrower herein or by
the Borrower (or any of its officers) in connection with this Agreement
shall prove to have been incorrect in any material respect when made; or
(c) (i) The Borrower shall fail to perform or observe any term,
covenant or agreement contained in Section 5.01(d), (e), (h) or (i), 5.02
or 5.03, or (ii) the Borrower shall fail to perform or observe any other
term, covenant or agreement contained in this Agreement on its part to be
performed or observed if such failure shall remain unremedied for 20 days
after written notice thereof shall have been given to the Borrower by the
Agent or any Lender; or
(d) The Borrower or any of its Subsidiaries shall fail to pay any
principal of or premium or interest on any Debt that is outstanding in a
principal or notional amount of at least $50,000,000 in the aggregate (but
excluding Debt outstanding hereunder) of the Borrower or such Subsidiary
(as the case may be), when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Debt; or any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Debt and shall continue after
the
26
applicable grace period, if any, specified in such agreement or instrument,
if the effect of such event or condition is to accelerate, or to permit the
acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or redemption),
purchased or defeased, or an offer to prepay, redeem, purchase or defease
such Debt shall be required to be made, in each case prior to the stated
maturity thereof; or
(e) The Borrower or any of its Subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit
of creditors; or any proceeding shall be instituted by or against the
Borrower or any of its Subsidiaries seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any
law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of
a receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding
shall remain undismissed or unstayed for a period of 30 days, or any of the
actions sought in such proceeding (including, without limitation, the entry
of an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or for any substantial part of
its property) shall occur; or the Borrower or any of its Subsidiaries shall
take any corporate action to authorize any of the actions set forth above
in this subsection (e); or
(f) Judgments or orders for the payment of money in excess of
$50,000,000 in the aggregate shall be rendered against the Borrower or any
of its Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall
be any period of 10 consecutive days during which a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect; PROVIDED, HOWEVER, that any such judgment or order shall
not be an Event of Default under this Section 6.01(f) if and for so long as
(i) the amount of such judgment or order is covered by a valid and binding
policy of insurance between the defendant and the insurer covering payment
thereof and (ii) such insurer, which shall be rated at least "A" by A.M.
Best Company, has been notified of, and has not disputed the claim made for
payment of, the amount of such judgment or order; or
(g) (i) Any Person or two or more Persons acting in concert (other than
St. ▇▇▇▇ or its Subsidiaries) shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange Commission
under the Securities Exchange Act of 1934), directly or indirectly, of
Voting Stock of the Borrower (or other securities convertible into such
Voting Stock) representing 20% or more of the combined voting power of all
Voting Stock of the Borrower; or (ii) during any period of up to 24
consecutive months, commencing before or after the date of this Agreement,
individuals who at the beginning of such 24-month period were directors of
the Borrower shall cease for any reason (other than due to death or
disability) to constitute a majority of the board of directors of the
Borrower (except to the extent that individuals who at the beginning of
such 24-month period were replaced by individuals (x) elected by 66-2/3% of
the remaining members of the board of directors of the Borrower or (y)
nominated for election by a majority of the remaining members of the board
of directors of the Borrower and thereafter elected as directors by the
shareholders of the Borrower); or (iii) any Person or two or more Persons
acting in concert (other than St. ▇▇▇▇ or its Subsidiaries) shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their
acquisition of the power to exercise, directly or indirectly, a controlling
influence over the management or policies of the Borrower; or
(h) The Borrower or any of its ERISA Affiliates shall incur, or shall
be reasonably likely to incur liability in excess of $50,000,000 in the
aggregate as a result of one or more of the following: (i) the occurrence
of any ERISA Event; (ii) the partial or complete withdrawal of the Borrower
or any of its ERISA Affiliates from a Multiemployer Plan; or (iii) the
reorganization or termination of a Multiemployer Plan; or
27
(i) The Borrower shall fail to maintain a financial strength rating
from A.M. Best Company of A- or better;
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Borrower; PROVIDED, HOWEVER, that in the
event of an actual or deemed entry of an order for relief with respect to the
Borrower under the Federal Bankruptcy Code, (A) the obligation of each Lender to
make Advances shall automatically be terminated and (B) the Advances, all such
interest and all such amounts shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower.
ARTICLE VII
THE AGENT
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender hereby appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement or collection of the
Notes), the Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; PROVIDED, HOWEVER, that the Agent shall not be
required to take any action that exposes the Agent to personal liability or that
is contrary to this Agreement or applicable law. The Agent agrees to give to
each Lender prompt notice of each notice given to it by the Borrower pursuant to
the terms of this Agreement.
SECTION 7.02. AGENT'S RELIANCE, ETC. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them under or in connection with this Agreement,
except for its or their own gross negligence or willful misconduct. Without
limitation of the generality of the foregoing, the Agent: (i) may treat the
Lender that made any Advance as the holder of the Debt resulting therefrom until
the Agent receives and accepts an Assumption Agreement entered into by an
Assuming Lender as provided in Section 2.17 or 2.18, as the case may be, or an
Assignment and Acceptance entered into by such Lender, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07; (ii) may consult
with legal counsel (including counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (iii) makes no warranty or
representation to any Lender and shall not be responsible to any Lender for any
statements, warranties or representations (whether written or oral) made in or
in connection with this Agreement; (iv) shall not have any duty to ascertain or
to inquire as to the performance, observance or satisfaction of any of the
terms, covenants or conditions of this Agreement on the part of the Borrower or
the existence at any time of any Default or to inspect the property (including
the books and records) of the Borrower; (v) shall not be responsible to any
Lender for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; and (vi) shall incur no liability under or in respect
of this Agreement by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telecopier, telegram or telex) believed
by it to be genuine and signed or sent by the proper party or parties.
SECTION 7.03. CITIBANK AND AFFILIATES. With respect to its Commitment,
the Advances made by it and the Note issued to it, Citibank shall have the same
rights and powers under this Agreement as any other Lender and may exercise the
same as though it were not the Agent; and the term "Lender" or "Lenders" shall,
unless otherwise expressly indicated, include Citibank in its individual
capacity. Citibank and its Affiliates may accept deposits from, lend money to,
act as trustee under indentures of, accept investment banking engagements from
and
28
generally engage in any kind of business with, the Borrower, any of its
Subsidiaries and any Person who may do business with or own securities of the
Borrower or any such Subsidiary, all as if Citibank were not the Agent and
without any duty to account therefor to the Lenders. The Agent shall have no
duty to disclose information obtained or received by it or any of its Affiliates
relating to the Borrower or its Subsidiaries to the extent such information was
obtained or received in any capacity other than as Agent.
SECTION 7.04. LENDER CREDIT DECISION. Each Lender acknowledges that it
has, independently and without reliance upon the Agent or any other Lender and
based on the financial statements referred to in Section 4.01 and such other
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 Agent or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement.
SECTION 7.05. INDEMNIFICATION. The Lenders agree to indemnify the Agent
(to the extent not reimbursed by the Borrower), ratably according to the
respective principal amounts of the Advances then owed to each of them (or if no
Advances are at the time outstanding, ratably according to the respective
amounts of their Commitments), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed
on, incurred by, or asserted against the Agent in any way relating to or arising
out of this Agreement or any action taken or omitted by the Agent under this
Agreement (collectively, the "INDEMNIFIED COSTS"), PROVIDED that no Lender shall
be liable for any portion of the Indemnified Costs resulting from the Agent's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender agrees to reimburse the Agent promptly upon demand for its ratable
share of any out-of-pocket expenses (including reasonable counsel fees) incurred
by the Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, to the extent that the Agent
is not reimbursed for such expenses by the Borrower. In the case of any
investigation, litigation or proceeding giving rise to any Indemnified Costs,
this Section 7.05 applies whether any such investigation, litigation or
proceeding is brought by the Agent, any Lender or a third party.
SECTION 7.06. SUCCESSOR AGENT. The Agent may resign at any time by
giving written notice thereof to the Lenders and the Borrower and may be removed
at any time with or without cause by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent. If no successor Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days after
the retiring Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement.
SECTION 7.07. OTHER AGENTS. Each Lender hereby acknowledges that
neither the documentation agent nor any other Lender designated as any "Agent"
on the signature pages hereof has any liability hereunder other than in its
capacity as a Lender.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any provision
of this Agreement or the Notes, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Lenders, and then such waiver or consent shall be
effective only in
29
the specific instance and for the specific purpose for which given; PROVIDED,
HOWEVER, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following: (a) waive any of the
conditions specified in Section 3.01, (b) increase the Commitments of the
Lenders, (c) reduce the principal of, or interest on, the Advances or any fees
or other amounts payable hereunder, (d) postpone any date fixed for any payment
of principal of, or interest on, the Advances or any fees or other amounts
payable hereunder, (e) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Advances, or the number of Lenders,
that shall be required for the Lenders or any of them to take any action
hereunder or (f) amend this Section 8.01; and PROVIDED FURTHER that no
amendment, waiver or consent shall, unless in writing and signed by the Agent in
addition to the Lenders required above to take such action, affect the rights or
duties of the Agent under this Agreement or any Note.
SECTION 8.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic or
telex communication) and mailed, telecopied, telegraphed, telexed or delivered,
if to the Borrower, at its address at ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, Attention: Chief Financial Officer, with a copy to ▇▇▇▇▇ ▇▇▇▇▇▇,
Esq., ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇-▇▇▇▇; if to any Initial Lender, at its Domestic Lending Office specified
opposite its name on Schedule I hereto; if to any other Lender, at its Domestic
Lending Office specified in the Assumption Agreement or the Assignment and
Acceptance pursuant to which it became a Lender; and if to the Agent, at its
address at ▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Bank Loan
Syndications Department; or, as to the Borrower or the Agent, at such other
address as shall be designated by such party in a written notice to the other
parties and, as to each other party, at such other address as shall be
designated by such party in a written notice to the Borrower and the Agent. All
such notices and communications shall, when mailed, telecopied, telegraphed or
telexed, be effective when deposited in the mails, telecopied, delivered to the
telegraph company or confirmed by telex answerback, respectively, except that
notices and communications to the Agent pursuant to Article II, III or VII shall
not be effective until received by the Agent. Delivery by telecopier of an
executed counterpart of any amendment or waiver of any provision of this
Agreement or the Notes or of any Exhibit hereto to be executed and delivered
hereunder shall be effective as delivery of a manually executed counterpart
thereof.
SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of any Lender
or the Agent to exercise, and no delay in exercising, any right hereunder or
under any Note shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. COSTS AND EXPENSES. (a) The Borrower agrees to pay on
demand all reasonable costs and expenses of the Agent in connection with the
preparation, execution, delivery, administration, modification and amendment of
this Agreement, the Notes and the other documents to be delivered hereunder,
including, without limitation, (A) all due diligence, syndication (including
printing, distribution and bank meetings), transportation, computer,
duplication, appraisal, consultant, and audit expenses and (B) the reasonable
fees and expenses of counsel for the Agent with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under this
Agreement. The Borrower further agrees to pay on demand all costs and expenses
of the Agent and the Lenders, if any (including, without limitation, reasonable
counsel fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement, the Notes and
the other documents to be delivered hereunder, including, without limitation,
reasonable fees and expenses of counsel for the Agent and each Lender in
connection with the enforcement of rights under this Section 8.04(a).
(b) The Borrower agrees to indemnify and hold harmless the Agent and
each Lender and each of their Affiliates and their officers, directors,
employees, agents and advisors (each, an "INDEMNIFIED PARTY") from and against
any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or by reason of (including, without limitation, in
connection with any investigation, litigation or proceeding or preparation of a
defense in connection therewith) (i) the Notes, this Agreement, any of the
transactions contemplated herein or the actual or proposed use of the proceeds
of the Advances or (ii) the actual or alleged presence of Hazardous Materials on
any property of the Borrower or any of its Subsidiaries or any Environmental
Action relating in any way to the Borrower or any of its Subsidiaries, except to
the extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of
30
competent jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 8.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by the Borrower, its directors, equityholders or creditors
or an Indemnified Party or any other Person, whether or not any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. The Borrower also agrees not to assert any
claim for special, indirect, consequential or punitive damages against the
Agent, any Lender, any of their Affiliates, or any of their respective
directors, officers, employees, attorneys and agents, on any theory of
liability, arising out of or otherwise relating to the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of the
proceeds of the Advances.
(c) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance is made by the Borrower to or for the account of a Lender other
than on the last day of the Interest Period for such Advance, as a result of a
payment or Conversion pursuant to Section 2.07(d) or (e), 2.09 or 2.11,
acceleration of the maturity of the Notes pursuant to Section 6.01 or for any
other reason, or by an Eligible Assignee to a Lender other than on the last day
of the Interest Period for such Advance upon an assignment of rights and
obligations under this Agreement pursuant to Section 8.07 as a result of a
demand by the Borrower pursuant to Section 8.07(a), the Borrower shall, upon
demand by such Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such Lender any amounts required to compensate such
Lender for any additional losses, costs or expenses that it may reasonably incur
as a result of such payment or Conversion, including, without limitation, any
loss (including loss of anticipated profits), cost or expense incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by any
Lender to fund or maintain such Advance.
(d) The Borrower acknowledges that the distribution of material through
an electronic medium is not necessarily secure and that there are
confidentiality and other risks associated with such distribution. All notices,
financial statements, financial and other reports, certificates, requests and
other information materials (the "COMMUNICATIONS") and the website of the Agent
(the "PLATFORM") are provided "as is" and "as available". The Agent does not
warrant the accuracy, adequacy or completeness of the Communications or the
Platform and expressly disclaims liability for errors or omissions in the
Communications or the Platform. No warranty of any kind, express, implied or
statutory, including, without limitation, any warranty of merchantability,
fitness for a particular purpose, non-infringement of third party rights or
freedom from viruses or other code defects, is made by the Agent in connection
with the Communications or the Platform.
(e) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower contained in
Sections 2.10, 2.13 and 8.04 shall survive the payment in full of principal,
interest and all other amounts payable hereunder and under the Notes.
SECTION 8.05. RIGHT OF SET-OFF. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the Agent to
declare the Notes due and payable pursuant to the provisions of Section 6.01,
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 other indebtedness at any time owing by such Lender or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing under this
Agreement and the Note held by such Lender, whether or not such Lender shall
have made any demand under this Agreement or such Note and although such
obligations may be unmatured. Each Lender agrees promptly to notify the Borrower
after any such set-off and application, PROVIDED that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of each Lender and its Affiliates under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
that such Lender and its Affiliates may have.
SECTION 8.06. BINDING EFFECT. This Agreement shall become effective
(other than Section 2.01, which shall only become effective upon satisfaction of
the conditions precedent set forth in Section 3.01) when it shall have been
executed by the Borrower and the Agent and when the Agent shall have been
notified by each Initial Lender that such Initial Lender has executed it and
thereafter shall be binding upon and inure to the benefit of the Borrower, the
Agent and each Lender and their respective successors and assigns, except that
the Borrower shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lenders.
31
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender may and,
if demanded by the Borrower (so long as no Default has occurred and is
continuing and following a demand by such Lender pursuant to Section 2.10 or
2.13) upon at least five Business Days' notice to such Lender and the Agent,
will assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Advances owing to it and the Note or Notes held
by it); PROVIDED, HOWEVER, that (i) each such assignment shall be of a constant,
and not a varying, percentage of all rights and obligations under this
Agreement, (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 or an
integral multiple of $1,000,000 in excess thereof unless the Borrower and the
Agent otherwise agree, (iii) each such assignment shall be to an Eligible
Assignee, (iv) each such assignment made as a result of a demand by the Borrower
pursuant to this Section 8.07(a) shall be arranged by the Borrower after
consultation with the Agent and shall be either an assignment of all of the
rights and obligations of the assigning Lender under this Agreement or an
assignment of a portion of such rights and obligations made concurrently with
another such assignment or other such assignments that together cover all of the
rights and obligations of the assigning Lender under this Agreement, (v) no
Lender shall be obligated to make any such assignment as a result of a demand by
the Borrower pursuant to this Section 8.07(a) unless and until such Lender shall
have received one or more payments from either the Borrower or one or more
Eligible Assignees in an aggregate amount at least equal to the aggregate
outstanding principal amount of the Advances owing to such Lender, together with
accrued interest thereon to the date of payment of such principal amount and all
other amounts payable to such Lender under this Agreement, and (vi) the parties
to each such assignment shall execute and deliver to the Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with any Note subject to such assignment and a processing and recordation fee of
$3,500 payable by the parties to each such assignment, PROVIDED, HOWEVER, that
in the case of each assignment made as a result of a demand by the Borrower,
such recordation fee shall be payable by the Borrower except that no such
recordation fee shall be payable in the case of an assignment made at the
request of the Borrower to an Eligible Assignee that is an existing Lender, and
(vii) any Lender may, without the approval of the Borrower and the Agent, assign
all or a portion of its rights to any of its Affiliates. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, (x) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights (other than
its rights under Section 2.10, 2.13 and 8.04 to the extent any claim thereunder
relates to an event arising prior such assignment) and be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, 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
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01 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 Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, 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; (v) such assignee confirms that it is an Eligible Assignee; (vi)
such assignee appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under this Agreement as
are delegated to the Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto; and
32
(vii) such assignee agrees that it will perform in accordance with their terms
all of the obligations that by the terms of this Agreement are required to be
performed by it as a Lender.
(c) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee representing that it is an Eligible Assignee,
together with any Note or Notes subject to such assignment, the Agent shall, if
such Assignment and Acceptance has been completed and is in substantially the
form of Exhibit C hereto, (i) accept such Assignment and Acceptance, (ii) record
the information contained therein in the Register and (iii) give prompt notice
thereof to the Borrower.
(d) The Agent shall maintain at its address referred to in Section 8.02
a copy of each Assumption Agreement and each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lenders and the Commitment of, and principal amount of the
Advances owing to, each Lender from time to time (the "REGISTER"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Each Lender may sell participations to one or more banks or other
entities (other than the Borrower or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment, the Advances owing to it and any
Note or Notes held by it); PROVIDED, HOWEVER, that (i) such Lender's obligations
under this Agreement (including, without limitation, its Commitment to the
Borrower hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the Borrower, the Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and (v) no participant
under any such participation shall have any right to approve any amendment or
waiver of any provision of this Agreement or any Note, or any consent to any
departure by the Borrower therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Notes or
any fees or other amounts payable hereunder, in each case to the extent subject
to such participation, or postpone any date fixed for any payment of principal
of, or interest on, the Notes or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation.
(f) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 8.07, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; PROVIDED that, prior to any such disclosure, the assignee or
participant or proposed assignee or participant shall agree to preserve the
confidentiality of any Confidential Information relating to the Borrower
received by it from such Lender.
(g) Notwithstanding any other provision set forth in this Agreement,
any Lender may at any time create a security interest in all or any portion of
its rights under this Agreement (including, without limitation, the Advances
owing to it and any Note or Notes held by it) in favor of any Federal Reserve
Bank in accordance with Regulation A of the Board of Governors of the Federal
Reserve System.
SECTION 8.08. CONFIDENTIALITY. Neither the Agent nor any Lender shall
disclose any Confidential Information to any other Person without the consent of
the Borrower, other than (a) to the Agent's or such Lender's Affiliates and
their officers, directors, employees, agents and advisors and, as contemplated
by Section 8.07(f), to actual or prospective assignees and participants, and
then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process, (c) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking and (d) 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.
SECTION 8.09. GOVERNING LAW. This Agreement and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.
33
SECTION 8.10. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.
SECTION 8.11. JUDGMENT. (a) If for the purposes of obtaining judgment
in any court it is necessary to convert a sum due hereunder in U.S. dollars into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Agent could purchase Dollars with
such other currency at Citibank's principal office in London at 11:00 A.M.
(London time) on the Business Day preceding that on which final judgment is
given.
(b) The obligation of the Borrower in respect of any sum due from it in
any currency (the "PRIMARY CURRENCY") to any Lender or the Agent hereunder
shall, notwithstanding any judgment in any other currency, be discharged only to
the extent that on the Business Day following receipt by such Lender or the
Agent (as the case may be), of any sum adjudged to be so due in such other
currency, such Lender or the Agent (as the case may be) may in accordance with
normal banking procedures purchase the applicable Primary Currency with such
other currency; if the amount of the applicable Primary Currency so purchased is
less than such sum due to such Lender or the Agent (as the case may be) in the
applicable Primary Currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Lender or the Agent (as the
case may be) against such loss, and if the amount of the applicable Primary
Currency so purchased exceeds such sum due to any Lender or the Agent (as the
case may be) in the applicable Primary Currency, such Lender or the Agent (as
the case may be) agrees to remit to the Borrower such excess.
SECTION 8.12. JURISDICTION, ETC. (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York State court or federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or the Notes, 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 any such New York State court or, to the extent permitted by law,
in such federal court. The Borrower hereby agrees that service of process in any
such action or proceeding brought in the any such New York State court or in
such federal court may be made upon CT Corporation System at its offices at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "PROCESS AGENT") and
the Borrower hereby irrevocably appoints the Process Agent its authorized agent
to accept such service of process, and agrees that the failure of the Process
Agent to give any notice of any such service shall not impair or affect the
validity of such service or of any judgment rendered in any action or proceeding
based thereon. The Borrower hereby further irrevocably consents to the service
of process in any action or proceeding in such courts by the mailing thereof by
any parties hereto by registered or certified mail, postage prepaid, to the
Borrower at its address specified pursuant to Section 8.02. 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 may otherwise have to bring any action or proceeding
relating to this Agreement or the Notes in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection that
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 or the Notes in any New
York State or federal court. 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.
34
SECTION 8.13. WAIVER OF JURY TRIAL. Each of the Borrower, the Agent and
the Lenders hereby irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to this Agreement or the Notes or the actions of the
Agent or any Lender in the negotiation, administration, performance or
enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
PLATINUM UNDERWRITERS HOLDINGS, LTD.
By
----------------------------------
Title:
CITIBANK, N.A.,
as Agent
By
----------------------------------
Title:
INITIAL LENDERS
CITIBANK, N.A.
By
----------------------------------
Title:
35
JPMORGAN CHASE BANK
By
----------------------------------
Title:
36
BANK OF AMERICA, N.A.
By
----------------------------------
Title:
37
FLEET NATIONAL BANK
By
----------------------------------
Title:
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ BANK AND TRUST COMPANY
By
----------------------------------
Title:
39
SCHEDULE I
PLATINUM UNDERWRITERS HOLDINGS, LTD.
364-DAY CREDIT AGREEMENT
APPLICABLE LENDING OFFICES
Name of Initial Lender Commitment Domestic Lending Office Eurodollar Lending Office
---------------------- ---------- ----------------------- -------------------------
Bank of America, N.A. $17,500,000
Citibank, N.A. $35,000,000 Two Penns Way ▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Attn:
T: T:
F: F:
Fleet National Bank $15,000,000
JPMorgan Chase Bank $17,500,000
State Street Bank and $15,000,000
Trust Company
---------------------------------------------------------------------------------------------
Total of Commitments: $100,000,000
EXHIBIT A - FORM OF
PROMISSORY NOTE
U.S.$_______________ Dated: _______________, 200_
FOR VALUE RECEIVED, the undersigned, PLATINUM UNDERWRITERS HOLDINGS,
LTD., a company organized under the laws of Bermuda (the "BORROWER"), HEREBY
PROMISES TO PAY to the order of _________________________ (the "LENDER") for the
account of its Applicable Lending Office on the Termination Date (each as
defined in the Credit Agreement referred to below) the principal sum of
U.S.$[amount of the Lender's Commitment in figures] or, if less, the aggregate
principal amount of the Advances made by the Lender to the Borrower pursuant to
the
364-Day Credit Agreement dated as of June 21, 2002 among the Borrower, the
Lender and certain other lenders parties thereto, JPMorgan Chase Bank and Bank
of America, N.A., as syndication agents, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., as sole lead
arranger and Book Manager, and Citibank, N.A., as Agent for the Lender and such
other lenders (as amended or modified from time to time, the "CREDIT AGREEMENT";
the terms defined therein being used herein as therein defined) outstanding on
the Termination Date.
The Borrower promises to pay interest on the unpaid principal amount
of each Advance from the date of such Advance until such principal amount is
paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to Citibank, as Agent, at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in same day funds. Each Advance owing to the Lender by the
Borrower pursuant to the Credit Agreement, and all payments made on account of
principal thereof, shall be recorded by the Lender and, prior to any transfer
hereof, endorsed on the grid attached hereto which is part of this Promissory
Note.
This Promissory Note is one of the Notes referred to in, and is
entitled to the benefits of, the Credit Agreement. The Credit Agreement, among
other things, (i) provides for the making of Advances by the Lender to the
Borrower from time to time in an aggregate amount not to exceed at any time
outstanding the U.S. dollar amount first above mentioned, the indebtedness of
the Borrower resulting from each such Advance being evidenced by this Promissory
Note and (ii) contains provisions for acceleration of the maturity hereof upon
the happening of certain stated events and also for prepayments on account of
principal hereof prior to the maturity hereof upon the terms and conditions
therein specified.
PLATINUM UNDERWRITERS HOLDINGS, LTD.
By
---------------------------------
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of
Date Amount of Principal Paid Unpaid Principal Notation
Advance or Prepaid Balance Made by
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
2
EXHIBIT B - FORM OF
NOTICE OF BORROWING
Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[Date]
Attention: Bank Loan Syndications Department
Ladies and Gentlemen:
The undersigned, Platinum Underwriters Holdings, ltd., refers to the
364-Day Credit Agreement, dated as of June 21, 2002 (as amended or modified from
time to time, the "CREDIT AGREEMENT", the terms defined therein being used
herein as therein defined), among the undersigned, certain Lenders parties
thereto, JPMorgan Chase Bank and Bank of America, N.A., as syndication agents,
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., as sole lead arranger and Book Manager, and Citibank,
N.A., as Agent for said Lenders, and hereby gives you notice, irrevocably,
pursuant to Section 2.02 of the Credit Agreement that the undersigned hereby
requests a Borrowing under the Credit Agreement, and in that connection sets
forth below the information relating to such Borrowing (the "PROPOSED
BORROWING") as required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Borrowing is _______________,
200_.
(ii) The Type of Advances comprising the Proposed Borrowing is [Base
Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Borrowing is
$_________________.
[(iv) The initial Interest Period for each Eurodollar Rate Advance made
as part of the Proposed Borrowing is _____ month[s].]
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties contained in Section 4.01 of the
Credit Agreement are correct, before and after giving effect to the
Proposed Borrowing and to the application of the proceeds therefrom, as
though made on and as of such date; and
(B) no event has occurred and is continuing, or would result from such
Proposed Borrowing or from the application of the proceeds therefrom, that
constitutes a Default.
Very truly yours,
PLATINUM UNDERWRITERS HOLDINGS, LTD.
By
----------------------------------
Title:.
EXHIBIT C - FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the
364-Day Credit Agreement dated as of June
21, 2002 (as amended or modified from time to time, the "CREDIT AGREEMENT")
among Platinum Underwriters Holdings, ltd., a company organized under the laws
of Bermuda (the "BORROWER"), the Lenders (as defined in the Credit Agreement)
JPMorgan Chase Bank and Bank of America, N.A., as syndication agents, ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc., as sole lead arranger and Book Manager, and Citibank, N.A.,
as agent for the Lenders (the "AGENT"). Terms defined in the Credit Agreement
are used herein with the same meaning.
The "Assignor" and the "Assignee" referred to on Schedule I hereto
agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and to
the Assignor's rights and obligations under the Credit Agreement as of the date
hereof equal to the percentage interest specified on Schedule 1 hereto of all
outstanding rights and obligations under the Credit Agreement. After giving
effect to such sale and assignment, the Assignee's Commitment and the amount of
the Advances owing to the Assignee will be as set forth on Schedule 1 hereto.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Credit Agreement
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Note, if any, held by the Assignor [and requests that the
Agent exchange such Note for a new Note payable to the order of [the Assignee in
an amount equal to the Commitment assumed by the Assignee pursuant hereto or new
Notes payable to the order of the Assignee in an amount equal to the Commitment
assumed by the Assignee pursuant hereto and] the Assignor in an amount equal to
the Commitment retained by the Assignor under the Credit Agreement,
[respectively,] as specified on Schedule 1 hereto].
3. The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender; and (vi)
attaches any U.S. Internal Revenue Service forms required under Section 2.13 of
the Credit Agreement.
4. Following the execution of this Assignment and Acceptance, it
will be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "EFFECTIVE DATE") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1 hereto.
5. Upon such acceptance and recording by the Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender thereunder and (ii) the Assignor
shall, to the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after
the Effective Date, the Agent shall make all payments under the Credit Agreement
and the Notes in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and facility fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes for periods
prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of New York.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.
2
Schedule 1
to
Assignment and Acceptance
Percentage interest assigned: -----%
Assignee's Commitment: $------
Aggregate outstanding principal amount of Advances assigned: $------
Principal amount of Note payable to Assignee: $------
Principal amount of Note payable to Assignor: $------
Effective Date*: _______________, 200_
[NAME OF ASSIGNOR], as Assignor
By
----------------------------------
Title:
Dated: _______________, 200_
[NAME OF ASSIGNEE], as Assignee
By
----------------------------------
Title:
Dated: _______________, 200_
Domestic Lending Office:
[Address]
Eurodollar Lending Office:
[Address]
--------
* This date should be no earlier than five Business Days after the delivery
of this Assignment and Acceptance to the Agent.
3
Accepted [and Approved]** this
__________ day of _______________, 200_
CITIBANK, N.A., as Agent
By
----------------------------
Title:
[Approved this __________ day
of _______________, 200_
PLATINUM UNDERWRITERS HOLDINGS, LTD.
By ]*
----------------------------
Title:
--------
** Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the definition of "Eligible Assignee".
* Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the definition of "Eligible Assignee".
4
EXHIBIT D - FORM OF
OPINION OF COUNSEL
FOR THE BORROWER