1
FINAL EXECUTION COPY
EXHIBIT 10.4
--------------------------------------------------------------------------------
CREDIT AGREEMENT
Dated as of November 17, 1995
among
THE TJX COMPANIES, INC,
as Borrower,
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent, Co-Arranger and
Co-Syndication Agent,
BANK OF AMERICA ILLINOIS,
as Syndication Agent and Co-Arranger,
THE BANK OF NEW YORK,
as Documentation Agent, Co-Arranger and Co-Syndication Agent,
PEARL STREET L.P.,
as Co-Arranger and Co-Syndication Agent,
THE CO-AGENTS PARTY HERETO,
and
THE LENDERS PARTY HERETO
--------------------------------------------------------------------------------
2
FINAL EXECUTION COPY
TABLE OF CONTENTS
ARTICLE I: DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Certain Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
1.3 Accounting; Changes in Agreement Accounting Principles . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE II : THE CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.1. Term Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.2. The Revolving Credit Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.2.1 Syndicated Revolving Credit Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.2.2 Swing Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.3. Ratable Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.4. Types of Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.5. Facility Fee; Reductions in Aggregate Revolving Loan Commitment . . . . . . . . . . . . . . . . . 30
2.6. Minimum Amount of Each Advance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
2.7. Optional Principal Payments; Mandatory Prepayments . . . . . . . . . . . . . . . . . . . . . . . . 31
2.8. Method of Selecting Types and Interest Periods for Advances . . . . . . . . . . . . . . . . . . . 34
2.9. Conversion and Continuation of Outstanding Advances . . . . . . . . . . . . . . . . . . . . . . . 34
2.10. Determination of Interest Rate; Determination of Applicable Eurodollar Margins
and Applicable Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . 35
2.11. Rates Applicable After Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
2.12. Method of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
2.13. Notes; Telephonic Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
2.14. Interest Payment Dates; Interest and Fee Basis . . . . . . . . . . . . . . . . . . . . . . . . . 38
2.15. Notification of Advances, Interest Rates, Prepayments and Revolving Loan
Commitment Reductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.16. Lending Installations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.17. Non-Receipt of Funds by the Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . 39
2.18. Withholding Tax Exemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
2.19. Facility LCs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE III: CHANGE IN CIRCUMSTANCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45
3.1. Yield Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.2. Changes in Capital Adequacy Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3.3. Availability of Types of Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3.4. Funding Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
3.5. Lender Statements; Survival of Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
3.6. Replacement Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
i
3
FINAL EXECUTION COPY
ARTICLE IV: CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4.1. Initial Credit Extension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
4.2. Each Credit Extension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE V: REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
5.1. Corporate Existence and Standing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
5.2. Authorization and Validity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
5.3. No Conflict; Government Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
5.4. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
5.5. Material Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
5.6. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.7. Litigation and Contingent Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.8. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.9. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
5.10. Accuracy of Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.11. Regulations G, T, U and X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.12. Material Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.13. Compliance With Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
5.14. Ownership of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5.15. Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5.16. Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
5.17. Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
5.18. The Marshalls Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE VI: COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
6.1. Financial Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
6.2. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
6.3. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
6.4. Conduct of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
6.5. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
6.6. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.7. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.8. Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.9. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.10. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
6.11. Prohibited Seller Preferred Stock Transactions. . . . . . . . . . . . . . . . . . . . . . . . . 62
6.12. Subsidiary Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
6.13. Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
6.14. Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
6.15. Investments and Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
ii
4
FINAL EXECUTION COPY
6.16. Contingent Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
6.17. Liens; Restrictive Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
6.18. Cancellation of Lenders' Domestic Credit Facilities . . . . . . . . . . . . . . . . . . . . . . . 71
6.19. Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
6.20. Minimum Fixed Charge Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
6.21. Maximum Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
6.22. Minimum Consolidated Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
ARTICLE VII: DEFAULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.1. Breach of Representation or Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.2. Payment Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.3. Breach of Certain Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.4. Breach of Other Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.5. Default on Material Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
7.6. Voluntary Insolvency Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
7.7. Involuntary Insolvency Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
7.8. Condemnation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
7.9. Judgments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
7.10. ERISA Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
7.11. Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
7.12. Change of Control. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
7.13. Change of Subsidiary Ownership; Guaranty Defaults. . . . . . . . . . . . . . . . . . . . . . . . 76
ARTICLE VIII: ACCELERATION, WAIVERS,AMENDMENTS AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
8.1. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
8.2. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
8.3. Preservation of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
ARTICLE IX: GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.1. Survival of Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.2. Governmental Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.3. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.4. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
9.5. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
9.6. Several Obligations; Benefits of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 80
9.7. Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
(A) Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
(B) Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
iii
5
FINAL EXECUTION COPY
(C) Waiver of Certain Claims; Settlement of Claims . . . . . . . . . . . . . . . . . . . . . . 81
(D) Survival of Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
9.8. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
9.9. Nonliability of Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
9.10. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
9.11. CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL . . . . . . . . . . . . . . . . . . . . . 83
(A) JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
(B) OTHER JURISDICTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
(C) SERVICE OF PROCESS; INCONVENIENT FORUM . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(D) WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(E) ADVICE OF COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
9.12. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
9.13. Other Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
9.14. Facility Guaranty Releases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
ARTICLE X: THE ADMINISTRATIVE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.1. Appointment; Nature of Relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.2. Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.3. General Immunity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
10.4. No Responsibility for Loans, Creditworthiness, Collateral, Recitals, Etc. . . . . . . . . . . . . 87
10.5. Action on Instructions of Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
10.6. Employment of Agents and Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
10.7. Reliance on Documents; Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
10.8. The Administrative Agent's Reimbursement and Indemnification . . . . . . . . . . . . . . . . . . 88
10.9. Rights as a Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
10.10. Lender Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
10.11. Successor Administrative Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
10.12. Administrative Agent's Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
10.13. No Duties Imposed Upon Co-Arrangers, Syndication Agent, Co-Syndication
Agents or Documentation Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90
ARTICLE XI: SETOFF; RATABLE PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
11.1. Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
11.2. Ratable Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.3. Application of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
ARTICLE XII: BENEFIT OF AGREEMENT;
ASSIGNMENTS; PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.1. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.2. Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
iv
6
FINAL EXECUTION COPY
12.2.1 Permitted Participants; Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . .93
12.2.2. Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93
12.2.3. Benefit of Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93
12.3. Assignments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
12.3.1. Permitted Assignments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
12.3.2. Effect; Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
12.3.3. Covenants of the Borrower During the General Syndication . . . . . . . . . . . . . . .95
12.4. Dissemination of Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
12.5. Tax Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
ARTICLE XIII: NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
13.1. Giving Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
13.2. Change of Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96
ARTICLE XIV: COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
v
7
FINAL EXECUTION COPY
EXHIBITS AND SCHEDULES
EXHIBITS
--------
Exhibit "A-1" Form of Revolving Note
Exhibit "A-2" Form of Term Note
Exhibit "B" List of Closing Documents
Exhibit "C" Compliance Certificate
Exhibit "D" Money Transfer Instructions
Exhibit "E" Form of Assignment Agreement
Exhibit "F" Form of Facility Guaranty
SCHEDULES
---------
Schedule 1.1 Revolving Loan Commitments, Term Loans, Maximum Swing Loan
Amounts, Maximum Facility LCs and Notice Information
Schedule 5.3 Governmental Filings and Consents
Schedule 5.6 Tax Matters
Schedule 5.7 Litigation and Contingent Obligations
Schedule 5.8 Subsidiaries
Schedule 5.13 Compliance with Laws
Schedule 5.14 Properties
Schedule 6.12 Existing Subsidiary Indebtedness
Schedule 6.15 Existing Investments
Schedule 6.16 Contingent Obligations
Schedule 6.17 Liens
Disclosure Letter
vi
8
CREDIT AGREEMENT
This Agreement, dated as of November 17, 1995, is among THE TJX
COMPANIES, INC., the Lenders, THE FIRST NATIONAL BANK OF CHICAGO, as
Administrative Agent, Co-Arranger and Co-Syndication Agent, BANK OF AMERICA
ILLINOIS, as Syndication Agent and Co-Arranger, THE BANK OF NEW YORK, as
Documentation Agent, Co-Arranger and Co- Syndication Agent, PEARL STREET L.P.,
as Co-Arranger and, acting through its affiliate, ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.,
Co-Syndication Agent and CIBC, INC., CREDIT LYONNAIS NEW YORK BRANCH, CREDIT
LYONNAIS CAYMAN ISLANDS BRANCH, DEUTSCHE BANK AG, NEW YORK AND/OR CAYMAN
ISLANDS BRANCHES, THE FIRST NATIONAL BANK OF BOSTON, PNC BANK, NATIONAL
ASSOCIATION, SHAWMUT BANK, N.A. , as Co-Agents. The parties hereto agree as
follows:
ARTICLE I: DEFINITIONS
----------------------
1.1 CERTAIN DEFINED TERMS. In addition to the terms defined above,
the following terms used in this Agreement shall have the following meanings,
applicable both to the singular and the plural forms of the terms defined:
As used in this Agreement:
"ACQUISITION" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Borrower or any of its Subsidiaries (i) acquires any on-going business or all
or substantially all of the assets of any firm, corporation or division
thereof, whether through purchase of assets, merger or otherwise or (ii)
directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage or
voting power) of the outstanding partnership interests of a partnership.
"ACQUISITION DOCUMENTS" means the Stock Purchase Agreement and all
other documents, instruments and agreements entered into by the Borrower or any
of its Subsidiaries in connection with the Marshalls Acquisition.
"ADJUSTED SHORT TERM LOAN OBLIGATIONS" means, at any particular time,
(1) the sum of (a) the outstanding principal amount of the Revolving Loans at
such time PLUS (b) the outstanding principal amount of all other revolving or
short-term Indebtedness (other than current maturities of long-term
Indebtedness) of the Borrower and its domestic Subsidiaries for money borrowed
at such
9
FINAL EXECUTION COPY
time MINUS (2) cash and Cash Equivalents of the Trademark Subsidiaries;
PROVIDED, HOWEVER, no deduction shall be made under this CLAUSE (2) at any time
when a Specified Default has occurred and is continuing.
"ADMINISTRATIVE AGENT" means The First National Bank of Chicago in its
capacity as contractual representative for the Lenders, the Co-Arrangers, the
LC Issuers and the Swing Loan Lenders pursuant to ARTICLE X, and not in its
individual capacity as a Lender, Co-Arranger, LC Issuer or Swing Loan Lender,
and any successor Administrative Agent appointed pursuant to ARTICLE X.
"ADVANCE" means a borrowing hereunder consisting of the aggregate
amount of the several Loans (other than Swing Loans) made by the Lenders to the
Borrower of the same Type and, in the case of Eurodollar Advances, for the same
Eurodollar Interest Period.
"AFFILIATE" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such Person.
A Person shall be deemed to control another Person if the controlling Person
owns 10% or more of any class of voting securities (or other ownership
interests) of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of stock, by contract or
otherwise.
"AGGREGATE OUTSTANDING LC EXPOSURE" means, as of any day, the
aggregate of the Outstanding LC Exposures of all the Lenders.
"AGGREGATE OUTSTANDING SWING LOAN EXPOSURE" means, as of any day, the
aggregate of the Outstanding Swing Loan Exposures of all the Lenders.
"AGGREGATE OUTSTANDING CREDIT EXPOSURE" means, as of any day, the
aggregate of the Outstanding Credit Exposures of all the Lenders.
"AGGREGATE REVOLVING LOAN COMMITMENT" means the aggregate of the
Revolving Loan Commitments of all the Lenders, as reduced from time to time
pursuant to the terms hereof. The initial Aggregate Revolving Loan Commitment
is Five Hundred Million and 00/100 Dollars ($500,000,000.00).
"AGREEMENT" means this credit agreement, as it may be amended,
modified, supplemented or restated and in effect from time to time.
"AGREEMENT ACCOUNTING PRINCIPLES" means generally accepted accounting
principles as in effect as of the date of this Agreement, applied in a manner
consistent with that used in preparing the financial statements referred to in
SECTION 5.4.
2
10
FINAL EXECUTION COPY
"ALTERNATE BASE RATE" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the
sum of the Federal Funds Effective Rate for such day PLUS 1/2% per annum.
"APPLICABLE EURODOLLAR MARGINS" means the Applicable Term Loan
Eurodollar Margin and the Applicable Revolving Loan Eurodollar Margin.
"APPLICABLE FACILITY FEE" means, for any day, the percentage rate per
annum in effect on such day for the Facility Fee, determined in accordance with
SECTION 2.10(b).
"APPLICABLE FEE" means the Applicable Facility Fee and Applicable LC
Fee.
"APPLICABLE LC FEE" means, for any day, the percentage rate per annum
in effect on such day for Facility LCs, determined in accordance with the
provisions of SECTION 2.10(b) and SECTION 2.19(d).
"APPLICABLE REVOLVING LOAN EURODOLLAR MARGIN" means, for any day, the
percentage rate per annum in effect on such day for Revolving Loans consisting
of Eurodollar Rate Advances, determined in accordance with the provisions of
SECTION 2.10(b).
"APPLICABLE TERM LOAN EURODOLLAR MARGIN" means, for any day, the
percentage rate per annum in effect on such day for Term Loans consisting of
Eurodollar Rate Advances, determined in accordance with the provisions of
SECTION 2.10(b).
"ARTICLE" means an article of this Agreement unless another document is
specifically referenced.
"ASSET-EQUITY SALE" means, with respect to any Person, (i) the sale,
lease, conveyance, disposition or other transfer by such Person of any of its
assets (including by way of a sale-leaseback transaction and including the sale
or other transfer of any of the Capital Stock of any Subsidiary of such Person)
or (ii) the issuance, sale, conveyance, disposition or other transfer by such
Person of any Capital Stock of such Person; PROVIDED, HOWEVER, that
notwithstanding the foregoing, the term "Asset-Equity Sale" shall not include
(a) any transactions permitted under CLAUSES (i), (ii), (iii), (iv) or (v)
(but only for equipment sold under clause (v) that is being replaced) of
SECTION 6.14, any transactions permitted under CLAUSE (vii) of SECTION 6.14 in
connection with planned store closings of the T.J. Maxx and Marshalls stores
identified in the Disclosure Letter or (b) the issuance of Capital Stock upon
the exercise or exchange of options or the issuance of bonus stock pursuant to
employee incentive plans, in each case, which options have been issued or plans
entered into in the ordinary course of business consistent with past practices.
3
11
FINAL EXECUTION COPY
"AUTHORIZED OFFICER" means any of the President, the Chief Executive
Officer, the Chief Financial Officer, the Chief Operating Officer or the
Treasurer of the Borrower, acting singly.
"AVAILABLE AGGREGATE REVOLVING LOAN COMMITMENT" means, for any day,
the Aggregate Revolving Loan Commitment then in effect MINUS the sum of (i) the
aggregate principal amount of the outstanding Revolving Loans, (ii) the
Aggregate Outstanding LC Exposure and (iii) the Aggregate Outstanding Swing
Loan Exposure.
"BORROWER" means The TJX Companies, Inc., a Delaware corporation, and
its successors and permitted assigns.
"BORROWER CREDIT DOCUMENTS" means this Agreement, the Notes, the
Disclosure Letter, any and all Facility LC Application Agreements and the fee
agreement entered into between the Borrower and the Administrative Agent dated
October 14, 1995.
"BORROWING DATE" means a date on which an Advance or Swing Loan is
made hereunder.
"BORROWING NOTICE" is defined in SECTION 2.8.
"BUSINESS DAY" means (i) with respect to any borrowing, payment or
rate selection of Eurodollar Advances, a day (other than a Saturday or Sunday)
on which banks generally are open in Chicago, Pittsburgh and New York for the
conduct of substantially all of their commercial lending activities and on
which dealings in United States dollars are carried on in the London interbank
market and (ii) for all other purposes, a day (other than a Saturday or Sunday)
on which banks generally are open in Chicago, Pittsburgh and New York for the
conduct of substantially all of their commercial lending activities.
"CAPITAL STOCK", with respect to any Person, means any capital stock
or other ownership interest of such Person, regardless of class or designation,
and all warrants, options, purchase rights, conversion or exchange rights,
voting rights, calls or claims of any character with respect thereto.
"CAPITALIZED LEASE" of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with Agreement Accounting Principles.
"CAPITALIZED LEASE OBLIGATIONS" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"CASH EQUIVALENTS" means (i) marketable direct obligations issued or
unconditionally guaranteed by the United States government and backed by the
full faith and credit of the United
4
12
FINAL EXECUTION COPY
States government; (ii) domestic, Eurodollar and, solely for any foreign
Subsidiaries, foreign currency (in such Subsidiary's local currency)
denominated certificates of deposit, demand deposit accounts, and time
deposits, bankers' acceptances and floating rate certificates of deposit issued
by any commercial bank organized under the laws of the United States, any state
thereof, the District of Columbia, any foreign bank, or its branches or
agencies (fully protected in the case of Investments by the Borrower and its
domestic Subsidiaries against currency fluctuations for any such deposits with
a term of more than thirty (30) days) having capital and surplus in excess of
$100,000,000; (iii) shares of money market, mutual or similar funds having
assets in excess of $100,000,000 and at least 80% of the investments of which
are limited to securities rated at least Baa2 by ▇▇▇▇▇'▇ or at least BBB by S&P
and (iv) commercial paper of issuers which, at the time of acquisition, are
rated A-2 (or better) by S&P or P-2 (or better) by ▇▇▇▇▇'▇; (v) variable rate
notes issued by municipal or other governmental authorities rated at least Baa2
by ▇▇▇▇▇'▇ or at least BBB by S&P; (vi) in the case of foreign Subsidiaries,
short term investments customary in the applicable jurisdiction of a similar
nature, credit quality and rated by the applicable local ratings agency with
the equivalent credit ratings as those set forth in CLAUSES (iii) through (v)
above and (vii) repurchase agreements with Lenders or any other Person
constituting an Eligible Assignee for securities of the type described in
clause (i) above with a term of not more than seven (7) days; PROVIDED that the
maturities of such Cash Equivalents shall not exceed 365 days.
"CHANGE" is defined in SECTION 3.2.
"CHANGE IN CONTROL" means:
(a) the acquisition by any Person, or "group" (within the
meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act
of 1934, as amended) of Persons acting in concert, of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as
amended), directly or indirectly, of 35% or more of the outstanding
shares of voting stock of the Borrower; or
(b) during any period of twelve (12) consecutive calendar
months, individuals:
(i) who were directors of the Borrower on the first day
of such period; or
(ii) whose election or nomination for election to the
board of directors of the Borrower was recommended or
approved by at least a majority of the directors then
still in office who were directors of the Borrower on
the first day of such period, or whose election or
nomination for election was so approved,
shall cease to constitute a majority of the board of directors
of the Borrower.
5
13
FINAL EXECUTION COPY
"CO-AGENTS" means CIBC, Inc., Credit Lyonnais, New York Branch and
Credit Lyonnais, Chicago ▇▇▇▇▇, Deutsche Bank AG, New York and/or Cayman
Islands Branch, The First National Bank of Boston, PNC Bank, National
Association, and Shawmut Bank, N.A., in their capacity as co-agents hereunder.
"CO-ARRANGERS" means (i) First Chicago, in its capacity as a
co-arranger and a co-syndication agent hereunder, (ii) Bank of America
Illinois, in its capacity as syndication agent and a co-arranger hereunder,
(iii) The Bank of New York, in its capacity as documentation agent, a
co-arranger and a co-syndication agent hereunder and (iv) Pearl Street L.P., in
its capacity as a co-arranger and, acting through its affiliate, ▇▇▇▇▇▇▇, ▇▇▇▇▇
& Co., a co-syndication agent hereunder.
"CODE" means the Internal Revenue Code of 1986, as amended, reformed
or otherwise modified from time to time.
"CONDEMNATION" is defined in SECTION 7.8.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including that portion of Capitalized Leases which is capitalized on the
consolidated balance sheet of the Borrower and its Subsidiaries) by the
Borrower and its Subsidiaries during that period that, in conformity with
Agreement Accounting Principles, are required to be included in or reflected by
the property, plant or equipment or similar fixed asset accounts reflected in
the consolidated balance sheet of the Borrower and its Subsidiaries.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, for any period, the
ratio of:
(i) the sum of the amounts of (a) EBIT, PLUS (b)
consolidated depreciation, PLUS (c) consolidated
amortization expense, including, without limitation,
amortization of goodwill and other intangible assets
and other non- cash charges but excluding reserves,
PLUS (d) Consolidated Rentals, MINUS (e) Consolidated
Capital Expenditures to
(ii) the sum of the amounts of (a) Consolidated Interest
Expense, PLUS (b) Consolidated Rentals.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total interest
expense (whether paid or accrued), net of interest income, of the Borrower and
its Subsidiaries for such period determined in accordance with Agreement
Accounting Principles, including, without limitation, such interest expense as
may be attributable to Capitalized Leases, as well as all commissions,
discounts and other fees and charges owed with respect to Letters of Credit and
net costs under any interest rate swap, exchange or cap agreements.
6
14
FINAL EXECUTION COPY
"CONSOLIDATED NET INCOME" means, for any period, the consolidated net
income (or loss) of the Borrower and its Subsidiaries for such period
determined in accordance with Agreement Accounting Principles; PROVIDED, that
there shall be excluded (i) the income (or loss) of any Affiliate of the
Borrower or other Person (other than a Subsidiary of the Borrower) in which any
Person (other than the Borrower or any of its Subsidiaries) has a joint
interest, except to the extent of the amount of dividends or other
distributions actually paid to the Borrower or any of its Subsidiaries by such
Affiliate or other Person during such period and (ii) the income (or loss) of
any Person accrued prior to the date it becomes a Subsidiary of the Borrower or
is merged into or consolidated with the Borrower or any of its Subsidiaries or
that Person's assets are acquired by the Borrower or any of its Subsidiaries.
"CONSOLIDATED NET WORTH" means, as of any date of determination, the
consolidated shareholders' equity of the Borrower and its Subsidiaries
determined in accordance with Agreement Accounting Principles.
"CONSOLIDATED RENTALS" means, for any period, the aggregate rental
amounts payable by the Borrower and its Subsidiaries for such period under any
lease of Property having an original term (including any required renewals or
any renewals at the option of the lessor or lessee) of one year or more (but
does not include any amounts payable under Capitalized Leases), determined in
accordance with Agreement Accounting Principles; PROVIDED, HOWEVER, that there
shall be excluded from such calculation rentals in respect of discontinued
operations and other store closings reflected in the Borrower's consolidated
financial statements (or the footnotes thereto) to the extent such rentals
relate to operations for which a charge has been taken and/or reserve
established in accordance with Agreement Accounting Principles and which do not
exceed the amount of such charge and/or reserve, the amount of which charge
and/or reserve has been established consistent with the manner in which the
Designated Reserves were determined.
"CONSOLIDATED TANGIBLE NET WORTH" means, as of any date of
determination, Consolidated Net Worth MINUS the aggregate amount required to be
recorded or included as goodwill or other intangible assets (to the extent
separately identified as intangible assets on the balance sheet) of the
Borrower and its Subsidiaries, determined on a consolidated basis and in
accordance with Agreement Accounting Principles.
"CONTINGENT OBLIGATION" of a Person means any agreement, written
undertaking or contractual arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide funds for the
payment of, or otherwise becomes or is contingently liable upon, the financial
or monetary obligation or financial or monetary liability of any other Person
(excluding customary indemnification obligations arising from a purchase and
sale agreement negotiated at arm's length and typical for transactions of a
similar nature), or agrees in writing to maintain the net worth or working
capital or other financial condition of any other Person, or otherwise assures
any creditor of such other Person in writing against loss, including, without
limitation, any contingent
7
15
FINAL EXECUTION COPY
reimbursement obligations of such Person with respect to any Letter of Credit,
as well as any comfort letter, keep well agreement, support agreement,
operating agreement or take-or-pay contract.
"CONVERSION/CONTINUATION NOTICE" is defined in SECTION 2.9.
"CONTRIBUTION AGREEMENT" means that certain Contribution Agreement of
even date herewith executed by and among the Borrower and the Facility
Guarantors, together with all supplements thereto and modifications, amendments
or restatements thereof.
"CONTROLLED GROUP" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower or any of its Subsidiaries,
are treated as a single employer under Section 414 of the Code.
"CORPORATE BASE RATE" means a rate per annum equal to the corporate
base rate of interest announced by First Chicago from time to time, changing
when and as said corporate base rate changes.
"CREDIT DOCUMENTS" means, collectively, the Borrower Credit Documents,
the Facility Guaranties and the Contribution Agreement.
"CREDIT EXTENSION" means either the making of an Advance, the making
of a Swing Loan or the issuance or Modification of a Facility LC hereunder.
"CREDIT EXTENSION DATE" means the Borrowing Date for an Advance or
Swing Loan or the issuance or Modification date for a Facility LC.
"CREDIT RATINGS" is defined in SECTION 2.10.
"DEFAULT" means an event described in ARTICLE VII.
"DESIGNATED ISSUER" is defined in SECTION 2.19(a).
"DESIGNATED PREPAYMENT" is defined in SECTION 2.7(b).
"DESIGNATED RESERVES" means the reserves in the amounts and of the
categories identified in the Disclosure Letter.
"DESIGNATED SALE" is defined in the Disclosure Letter.
"DISCLOSURE LETTER" means that certain disclosure letter dated of even
date herewith issued by the Borrower and addressed to the Administrative Agent
and the Lenders, as the same may from
8
16
FINAL EXECUTION COPY
time to time be amended, modified, supplemented or restated with the consent of
the Required Lenders.
"EBIT" means, for any period, on a consolidated basis for the Borrower
and its Subsidiaries, the sum of the amounts for such period of (i)
Consolidated Net Income, PLUS (ii) charges against income for foreign, federal,
state and local taxes to the extent deducted in computing Consolidated Net
Income, PLUS (iii) Consolidated Interest Expense to the extent deducted in
computing Consolidated Net Income, PLUS (iv) the Designated Reserves to the
extent deducted in computing Consolidated Net Income, MINUS (v) extraordinary
gains (and any unusual gains whether or not arising in the ordinary course of
business not included in extraordinary gains) in each case to the extent
included in the calculation of Consolidated Net Income.
"ELIGIBLE ASSIGNEE" means (i) a Lender or any Affiliate thereof; (ii)
a commercial bank having capital and surplus in excess of $100,000,000; (iii) a
finance company, insurance company, other financial institution or fund,
acceptable to the Administrative Agent and the Co-Arrangers, which is regularly
engaged in making, purchasing or investing in loans and having total assets in
excess of $100,000,000; or (iv) a finance company, insurance company, bank,
other financial institution or fund reasonably acceptable to the Borrower, the
Administrative Agent and the Co-Arrangers.
"ENVIRONMENTAL, HEALTH OR SAFETY REQUIREMENTS OF LAW" means all
Requirements of Law derived from or relating to federal, state and local laws
or regulations relating to or addressing pollution or protection of the
environment, or protection of worker health or safety, including, but not
limited to, the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. Section 9601 ET SEQ., the Occupational Safety and
Health Act of 1970, 29 U.S.C. Section 651 ET SEQ., and the Resource
Conservation and Recovery Act of 1976, 42 U.S.C. Section 6901 ET SEQ., in each
case including any amendments thereto, any successor statutes, and any
regulations or guidance promulgated thereunder, and any state or local
equivalent thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"EURODOLLAR ADVANCE" means an Advance which bears interest at a
Eurodollar Rate.
"EURODOLLAR BASE RATE" means, with respect to a Eurodollar Advance for
the relevant Eurodollar Interest Period, the rate determined by the
Administrative Agent to be the arithmetic average of the rates reported to the
Administrative Agent by each Reference Bank as the rate at which deposits in
U.S. dollars are offered by such Reference Bank to first-class banks in the
London interbank market at approximately 11 a.m. (London time) two Business
Days prior to the first day of such Eurodollar Interest Period, in the
approximate amount of such Reference Bank's relevant Eurodollar Loan and having
a maturity approximately equal to such Eurodollar Interest Period. If
9
17
FINAL EXECUTION COPY
any Reference Bank fails to provide such quotation to the Agent, then the Agent
shall determine the Eurodollar Base Rate on the basis of the quotations of the
remaining Reference Bank(s).
"EURODOLLAR INTEREST PERIOD" means, with respect to a Eurodollar
Advance, a period of one, two, three or six months commencing on a Business Day
selected by the Borrower pursuant to this Agreement; PROVIDED, HOWEVER, during
the period from the date of this Agreement until the completion of the General
Syndication, Eurodollar Interest Periods shall be confined to a period of one
month or, subject to availability from each Lender, a period of one week.
Other than weekly Interest Periods during the period of the General Syndication
(which Eurodollar Interest Periods shall be subject to the conventions
generally applicable with respect to such shorter interest periods), such
Eurodollar Interest Period shall end on (but exclude) the day which corresponds
numerically to such date one, two, three or six months thereafter; PROVIDED,
HOWEVER, that if there is no such numerically corresponding day in such next,
second, third or sixth succeeding month, such Eurodollar Interest Period shall
end on the last Business Day of such next, second, third or sixth succeeding
month. If a Eurodollar Interest Period would otherwise end on a day which is
not a Business Day, such Eurodollar Interest Period shall end on the next
succeeding Business Day, PROVIDED, HOWEVER, that if said next succeeding
Business Day falls in a new calendar month, such Eurodollar Interest Period
shall end on the immediately preceding Business Day.
"EURODOLLAR LOAN" means a Loan which bears interest at a Eurodollar
Rate.
"EURODOLLAR RATE" means, with respect to a Eurodollar Advance for the
relevant Eurodollar Interest Period, a rate per annum equal to the sum of (i)
the quotient of (a) the Eurodollar Base Rate applicable to such Eurodollar
Interest Period, DIVIDED BY (b) one MINUS the Reserve Requirement (expressed as
a decimal) applicable to such Eurodollar Interest Period, PLUS (ii) the
Applicable Eurodollar Margin. The Eurodollar Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.
"EXCLUDED ASSET SALE" means any Asset-Equity Sale consummated by the
Borrower at a time when no Default or Unmatured Default has occurred and is
continuing, consisting of the sale, lease, conveyance, disposition or other
transfer by the Borrower of all or substantially all of the assets or Capital
Stock of the operating division or Subsidiary identified in SECTION 6.14 of the
Disclosure Letter (other than T.J. Maxx or Marshalls) consisting of a
Designated Sale consummated in accordance with the terms set forth in SECTION
6.14(vi), the Net Cash Proceeds of which are required to be used to redeem or
otherwise repurchase any or all of the Series D Seller Preferred Stock and the
balance of which is applied as provided in SECTION 2.7(b).
"EXCLUDED EQUITY ISSUANCE" means, the issuance, sale, conveyance,
disposition or other transfer by the Borrower of any of its Capital Stock
consisting of (i) common Capital Stock, (ii) convertible preferred stock of the
Borrower issued in an amount and on terms substantially similar to the terms of
the Series E Seller Preferred Stock and otherwise reasonably acceptable to the
10
18
FINAL EXECUTION COPY
Administrative Agent and the other Co-Arrangers, the Net Cash Proceeds of which
are used to redeem or otherwise repurchase any or all of the Seller Preferred
Stock and the balance of which is applied as provided in SECTION 2.7(b) and
(iii) any other Capital Stock of the Borrower, the Net Cash Proceeds of which
are used to redeem or otherwise repurchase any or all of the Borrower's
outstanding Series A preferred stock or Series C preferred stock (with any
excess balance being applied in accordance with SECTION 2.7(b)) provided such
Capital Stock so issued, sold, conveyed or transferred shall be on terms
(including, without limitation, maturity, dividend, designations and
preferences, voting rights and remedies) not materially less favorable to the
Borrower or materially adverse to the Lenders than the terms of the existing
Series A or Series C preferred stock being so redeemed or otherwise
repurchased.
"FACILITY FEE" is defined in SECTION 2.5.
"FACILITY GUARANTOR" means (i) T.J. Maxx of Illinois, Inc., an
Illinois corporation, T.J. Maxx of PA, Inc., a Delaware corporation, T.J. Maxx
of Texas, Inc., a Delaware corporation, NBC Fourth Realty Corp., a Nevada
corporation, ▇▇▇▇▇▇▇▇'▇ of Boston, Ltd., a Massachusetts corporation,
HomeGoods, Inc., a Delaware corporation, Marshalls, Marshalls of Richfield, MN,
Inc., a Minnesota corporation, Marshalls, Inc., a Massachusetts corporation and
CDM Corp., a Nevada corporation, and each other Subsidiary of the Borrower, if
any, which has executed a Facility Guaranty as of the date of this Agreement
and (ii) each additional Subsidiary which hereafter enters into a Facility
Guaranty, in each case together with its successors and assigns.
"FACILITY LC" is defined in SECTION 2.19(a).
"FACILITY LC APPLICATION AGREEMENT" is defined in SECTION 2.19(d).
"FACILITY GUARANTY" means a Guaranty, substantially in the form of
EXHIBIT "F" hereto, duly executed and delivered by a Subsidiary of the Borrower
to and in favor of the Administrative Agent for the benefit of itself, the
Co-Arrangers, the LC Issuers, the Swing Loan Lenders and the Lenders, as it may
from time to time be amended, supplemented, restated or otherwise modified.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, an interest rate
per annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day
which is a Business Day, the average of the quotations at approximately 10 a.m.
(Chicago time) on such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by the
Administrative Agent in its sole discretion.
11
19
FINAL EXECUTION COPY
"FIRST CHICAGO" means The First National Bank of Chicago in its
individual capacity, and its successors.
"FLOATING RATE" means, for any day, a rate per annum equal to the
Alternate Base Rate, changing when and as the Alternate Base Rate changes.
"FLOATING RATE ADVANCE" means an Advance which bears interest at the
Floating Rate.
"FLOATING RATE LOAN" means a Loan which bears interest at the Floating
Rate.
"FUNDED DEBT" of any Person means, without duplication, all
obligations of such Person for money borrowed which in accordance with
Agreement Accounting Principles shall be classified upon a balance sheet of
such Person as liabilities of such Person, and in any event shall include (a)
all Capitalized Lease Obligations of such Person and (b) all Contingent
Obligations of such Person with respect to obligations of others of the
character referred to in this definition, but shall exclude (i) notes, bills
and checks presented in the ordinary course of business by such Person to banks
for collection or deposit, (ii) with reference to the Borrower and its
Subsidiaries, all obligations of the Borrower and its Subsidiaries of the
character referred to in this definition to the extent owing to the Borrower or
any Subsidiary, (iii) bankers acceptances which, in accordance with Agreement
Accounting Principles, are classified as accounts payable and (iv) Contingent
Obligations set forth on SCHEDULE 6.16. Without in any way limiting the
foregoing, Funded Debt of the Borrower shall include all Loans outstanding
under this Agreement and the Notes.
"GENERAL SYNDICATION" is defined in SECTION 12.3.3.
"GOVERNMENTAL AUTHORITY" means any nation or government, any federal,
state, local or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"GROSS NEGLIGENCE" means recklessness, the absence of the slightest
care or the complete disregard of consequences. Gross Negligence does not mean
the absence of ordinary care or diligence, or an inadvertent act or inadvertent
failure to act. If the term "gross negligence" is used with respect to the
Administrative Agent, any Co-Arranger, any LC Issuer, any Swing Loan Lender or
any Lender or any Indemnitee in any of the other Credit Documents, it shall
have the meaning set forth herein.
"INDEBTEDNESS" of a Person means, without duplication, such Person's
(i) obligations for borrowed money, (ii) obligations representing the deferred
purchase price of Property or services (other than (a) accounts payable and (b)
bankers acceptances classified in accordance with Agreement Accounting
Principles as accounts payable, in each case arising in the ordinary course of
such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not
12
20
FINAL EXECUTION COPY
assumed, secured by Liens or required to be paid out of the proceeds or
production from property now or hereafter owned or acquired by such Person,
(iv) obligations which are evidenced by notes, acceptances (to the extent not
classified as accounts payable in accordance with Agreement Accounting
Principles), or other instruments, (v) the maximum fixed repurchase price of
any Redeemable Stock (payable upon the occurrence of any contingency or
otherwise) subject to mandatory redemption, (vi) Capitalized Lease Obligations,
(vii) Off Balance Sheet Liabilities and (viii) Contingent Obligations. For
purposes of the preceding sentence, the maximum fixed repurchase price of any
Redeemable Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Stock as if such
Redeemable Stock were repurchased on any date on which Indebtedness shall be
required to be determined pursuant to this Agreement, PROVIDED that if such
Redeemable Stock is not then permitted to be repurchased, the repurchase price
shall be the book value of such Redeemable Stock. The amount of Indebtedness
of any Person at any date shall be without duplication the outstanding balance
at such date of all unconditional obligations as described above and the
maximum liability of any such Contingent Obligations at such date.
"INDEMNIFIED MATTERS" is defined in SECTION 9.7.
"INDEMNITEES" is defined in SECTION 9.7(B).
"INFORMATION MEMORANDUM" means the Confidential Information Memorandum
dated October 1995 furnished to prospective Lenders.
"INTELLECTUAL PROPERTY" means (i) any and all intangible personal
property consisting of intellectual property, whether or not registered with
any governmental entity, including, without limitation, franchises, licenses,
patents, technology and know-how, copyrights, trademarks, trade secrets,
service marks, logos and trade names and (ii) any and all contract rights
(including, without limitation, applications for governmental registrations,
license agreements, trust agreements and assignment agreements) creating,
evidencing or conveying an interest or right in or to any of the intellectual
property described in the preceding clause (i).
"INVESTMENT" of a Person means any loan, advance (other than
commissions, travel and other loans, credits and advances to officers and
employees made in the ordinary course of business), extension of credit,
deposit account or contribution of capital by such Person to any other Person
or any investment in, or purchase or other acquisition of, the stock,
partnership interests, notes, debentures or other securities of any other
Person made by such Person, other than anticipatory prepayments to vendors in
the ordinary course of business consistent with past practice.
"LC ISSUER" means (i) with respect to each of First Chicago, Bank of
America Illinois and The Bank of New York, or their respective Affiliates, in
such Person's capacity as LC Issuer hereunder with respect to each Facility LC
issued by it and (ii) any Lender (other than First Chicago,
13
21
FINAL EXECUTION COPY
Bank of America Illinois and The Bank of New York) or its Affiliates, in its
capacity as a LC Issuer hereunder with respect to any and all Facility LCs
issued by such Person in its sole discretion upon the Borrower's request. All
references contained in this Agreement and the other Credit Documents to the
"LC Issuer" shall be deemed to apply equally to each of the institutions (and
their respective Affiliates) referred to in clauses (i) and (ii) of this
definition in their respective capacities as a LC Issuer of any and all
Facility LCs issued by each such institution (or its Affiliates).
"LC OBLIGATIONS" means, at any time, the sum, without duplication, of
(i) the aggregate amount available for drawing under all Facility LCs
outstanding at such time PLUS (ii) the aggregate unpaid amount at such time of
all Reimbursement Obligations in respect of previous drawings made under
Facility LCs.
"LC PAYMENT DATE" is defined in SECTION 2.19(e).
"LENDERS" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and permitted assigns.
"LENDING INSTALLATION" means, with respect to a Lender, LC Issuer,
Swing Loan Lender, the Administrative Agent or a Co- Arranger, any office,
branch, subsidiary or affiliate of such Lender, LC Issuer, Swing Loan Lender,
Administrative Agent or Co- Arranger.
"LETTER OF CREDIT" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"LIEN" means any lien (statutory or other), mortgage, pledge,
hypothecation, collateral assignment, deposit arrangement, encumbrance or
preference, priority or other security interest or preferential arrangement of
any kind or nature whatsoever (including, without limitation, the interest of a
vendor or lessor under any conditional sale, Capitalized Lease or other title
retention agreement).
"LOAN" means, (i) with respect to a Lender, such Lender's portion of
any Advance made pursuant to SECTION 2.1 or 2.2, as applicable, (ii) with
respect to a Swing Loan Lender, such Swing Loan Lender's Swing Loan and (iii)
collectively, with respect to all Lenders, all Term Loans, Revolving Loans and
Swing Loans.
"MARSHALLS" means Marshalls of Roseville, Minn., Inc., a Minnesota
corporation.
"MARSHALLS ACQUISITION" means the Acquisition by the Borrower of all
of the outstanding Capital Stock of Marshalls on the terms set forth in the
Stock Purchase Agreement.
14
22
FINAL EXECUTION COPY
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, Property, condition (financial or otherwise), performance, results of
operations or prospects of the Borrower and its Subsidiaries taken as a whole,
(b) the ability of either the Borrower or any Subsidiary to perform its
respective obligations under the Credit Documents to which it is a party or (c)
the validity or enforceability of any of the Credit Documents or any material
rights or remedies of the Administrative Agent, any LC Issuer, any Swing Loan
Lender or the Lenders thereunder.
"MATERIAL INDEBTEDNESS" means any Indebtedness, or group of different
Indebtedness, in an aggregate principal amount of at least $10,000,000.
"MODIFICATION" is defined in SECTION 2.19.
"MONEY MARKET RATE" is defined in SECTION 2.2.2.
"MONEY MARKET RATE LOAN" means a Swing Loan which bears interest at a
Money Market Rate.
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Service, Inc., a Delaware
corporation, together with any Person succeeding thereto by merger,
consolidation or acquisition of all or substantially all of its assets,
including substantially all of its business of rating securities.
"MULTIEMPLOYER PLAN" means a Plan as described in Section 4001(a)(3)
of ERISA to which the Borrower or any member of the Controlled Group has made
or is obligated to make contributions.
"NET CASH PROCEEDS" means, with respect to any Asset-Equity Sale
(including an Excluded Asset Sale or Excluded Equity Issuance) of any Person:
(a) cash (freely convertible into U.S. dollars) received by such Person or any
Subsidiary of such Person from such Asset-Equity Sale (including cash received
as consideration for the assumption or incurrence of long-term liabilities
assumed or incurred in connection with or in anticipation of such Asset-Equity
Sale), (b) unless otherwise consented to in writing by the Required Lenders in
connection with an Excluded Asset Sale consisting of a Designated Sale (in
which event such written consent shall control), an amount equal to the
principal amount of any Funded Debt, debt securities or other obligations
representing the deferred purchase price received by such Person or any
Subsidiary of such Person from such Asset-Equity Sale and (c) unless otherwise
consented to in writing by the Required Lenders in connection with an Excluded
Assets Sale consisting of a Designated Sale (in which event such written
consent shall control), an amount equal to the fair market value of any Capital
Stock or other non-cash consideration (in the nature of barter assets) received
by such Person or any Subsidiary of such Person from such Asset-Equity Sale, in
each case after (i) provision for all income or other taxes required to be paid
in cash as a result of such Asset-Equity Sale (after giving effect to the full
pro-rated utilization of any tax credits or loss carry forwards or similar
amounts which are available to
15
23
FINAL EXECUTION COPY
offset such taxes), (ii) payment of all brokerage commissions and other fees
and expenses related to such Asset-Equity Sale, (iii) all amounts used to repay
Indebtedness secured by a Lien on any asset disposed of in such Asset-Equity
Sale or (other than in respect of Capital Stock) which is or may be required
(by the express terms of the instrument governing such Indebtedness) to be
repaid in connection with such Asset-Equity Sale (including payments made to
obtain or avoid the need for the consent of any holder of such Indebtedness),
and (iv) deduction of appropriate amounts taken by such Person or a Subsidiary
of such Person as a cash reserve against any liabilities associated with the
assets sold or disposed of in such Asset-Equity Sale and retained by such
Person or a Subsidiary of such Person after such Asset-Equity Sale.
"NOTES" means the Revolving Notes and the Term Notes.
"NON-FACILITY LCS" means Letters of Credit issued by a Lender or any
other financial institution under a credit arrangement other than pursuant to
this Agreement.
"NON-GUARANTOR SUBSIDIARY" means any Subsidiary of the Borrower other
than a Facility Guarantor.
"NOTICE OF ASSIGNMENT" is defined in SECTION 12.3.2.
"OBLIGATIONS" means all Loans, Swing Loans, unpaid principal of and
accrued and unpaid interest on the Notes, LC Obligations, accrued and unpaid
fees and expenses, reimbursements, indemnities and other obligations of the
Borrower to the Lenders or any Lender, the LC Issuers or any LC Issuer, the
Swing Loan Lenders or any Swing Loan Lender, the Administrative Agent, the Co-
Arrangers or any Co-Arranger or any indemnified party hereunder arising under
the Credit Documents. The term "Obligations" includes, without limitation, all
interest, charges, expenses, fees, attorneys' fees and disbursements,
paralegals' fees and any other sum (in each case whether or not allowed)
chargeable to Borrower under this Agreement or any other Credit Document.
"OFF BALANCE SHEET LIABILITIES" of a Person means:
(a) any repurchase obligation or liability of such Person or
any of its Subsidiaries with respect to accounts or notes receivable
sold by such Person or any of its Subsidiaries;
(b) any repurchase obligation or liability of such Person or
any of its Subsidiaries with respect to property leased by such
Person;
(c) obligations arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing
but which does not constitute a liability on the consolidated balance
sheets of such Person and its Subsidiaries excluding therefrom (i)
operating leases which do not require payment by or due from such
Person: (x) at the
16
24
FINAL EXECUTION COPY
scheduled termination of such operating lease, (y) pursuant to a
required purchase by such Person of the leased property, or (z) under
any guaranty by such Person of the value of the leased property and
(ii) bankers acceptances which, in accordance with Agreement
Accounting Principles, are classified as accounts payable; or
(d) Rate Hedging Obligations.
"OUTSTANDING CREDIT EXPOSURE" means, as to any Lender at any time, the
sum of (i) the aggregate principal amount of its Revolving Loans outstanding at
such time, (ii) the aggregate principal amount of its Term Loan outstanding at
such time, (iii) its Outstanding LC Exposure at such time and (iv) its
outstanding Swing Loan Exposure at such time.
"OUTSTANDING LC EXPOSURE" means, as to any Lender at any time, an
amount equal to its Revolving Loan Percentage of the LC Obligations at such
time.
"OUTSTANDING SWING LOAN EXPOSURE" means, as to any Lender at any time,
an amount equal to its Revolving Loan Percentage of the outstanding Swing Loans
at such time.
"PARTICIPANTS" is defined in SECTION 12.2.1.
"PAYMENT DATE" means the last day of each March, June, September and
December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PERCENTAGE" means, with respect to any Lender, the percentage
obtained by dividing (A) the sum of (i) such Lender's Revolving Loan Commitment
at such time (in each case, as adjusted from time to time in accordance with
the provisions of this Agreement) plus (ii) the principal amount of such
Lender's Term Loan by (B) the sum of (i) the Aggregate Revolving Loan
Commitment at such time plus (ii) the aggregate principal amount of all Term
Loans; PROVIDED, HOWEVER, if all of the Revolving Loan Commitments are
terminated pursuant to the terms of this Agreement, then "Percentage" means the
percentage obtained by dividing (x) the sum of (i) the principal amount of such
Lender's Revolving Loans plus (ii) the principal amount of such Lender's Term
Loans by (y) the sum of (i) the aggregate principal amount of all Revolving
Loans and (ii) the aggregate principal amount of all Term Loans.
"PERSON" means any natural person, corporation, limited liability
company, firm, joint venture, partnership, association, enterprise, trust or
other entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
17
25
FINAL EXECUTION COPY
"PLAN" means an employee pension benefit plan which is covered by
Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Code as to which the Borrower or any member of the Controlled Group may
have any liability.
"PREPAYMENT INDEBTEDNESS" means all Indebtedness outstanding under
that certain Note Agreement dated as of December 30, 1994 executed by
▇▇▇▇▇▇▇▇'▇ of Boston, Ltd. with respect to its $45,000,000 8.73% Senior Secured
Notes due December 30, 2004.
"PROPERTY" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person, including, without limitation,
Intellectual Property.
"PURCHASERS" is defined in SECTION 12.3.1.
"RATED DEBT" means, the Borrower's senior unsecured
non-credit-enhanced long-term Indebtedness which Indebtedness does not benefit
from any guaranties or other credit enhancement provided by any of the
Borrower's Subsidiaries.
"RATE HEDGING OBLIGATIONS" of a Person means any and all net
obligations of such Person, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor), under (i) any
and all agreements, devices or arrangements designed to protect at least one of
the parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts and warrants, or any similar derivative
transactions and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any of the foregoing.
"REDEEMABLE STOCK" means any capital stock which by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, in whole or in part, prior to the maturity of the Obligations
(including any extensions thereof contemplated by this Agreement), or is, by
its terms or upon the happening of any event, redeemable at the option of the
holder thereof, in whole or in part, prior to the maturity of the Obligations
(including any extensions thereof contemplated by this Agreement).
"REFERENCE BANKS" means First Chicago, Bank of America Illinois and
The Bank of New York.
18
26
FINAL EXECUTION COPY
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member banks of the Federal
Reserve System.
"REGULATION G" means Regulation G of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by nonbank, nonbroker lenders for the purpose of
purchasing or carrying margin stock (as defined therein).
"REGULATION T" means Regulation T of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by and to brokers and dealers of securities for the
purpose of purchasing or carrying margin stock (as defined therein).
"REGULATION U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by banks for the purpose of purchasing or carrying
margin stock (as defined therein) applicable to member banks of the Federal
Reserve System.
"REGULATION X" means Regulation X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by foreign lenders for the purpose of purchasing or
carrying margin stock (as defined therein).
"REIMBURSEMENT OBLIGATIONS" means, at any time, the aggregate of all
obligations of the Borrower then outstanding under SECTION 2.19 to reimburse
all LC Issuers for amounts paid by such LC Issuers in respect of any one or
more drawings under Facility LCs.
"REPORTABLE EVENT" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of
the notice requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.
"REQUIRED LENDERS" means Lenders having, in the aggregate, Percentages
equal to or greater than fifty-one percent (51%); PROVIDED, HOWEVER, that in
the event any of the Lenders shall have failed to fund its Revolving Loan
Percentage of any Advance requested by the Borrower, any
19
27
FINAL EXECUTION COPY
participation in any Letter of Credit or any refunding of or participation in
any Swing Loan which such Lenders are obligated to fund under the terms of this
Agreement and any such failure has not been cured, then for so long as such
failure continues, "REQUIRED LENDERS" means Lenders (excluding all such
defaulting Lenders) whose Percentages represent more than fifty-one percent
(51%) of the aggregate Percentages of such non-defaulting Lenders; PROVIDED,
FURTHER, HOWEVER, that, if the Revolving Loan Commitments have been terminated
pursuant to the terms of this Agreement, "REQUIRED LENDERS" means Lenders
(without regard to such Lenders' performance of their respective obligations
hereunder) whose aggregate outstanding principal balance of all Loans and LC
Obligations is equal to or greater than fifty-one percent (51%).
"REQUIREMENTS OF LAW" means, as to any Person, the charter and by-laws
or other organizational or governing documents of such Person, and any law,
rule or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject including, without limitation, the Securities Act of 1933, as amended,
the Securities Exchange Act of 1934, as amended, Regulations G, T, U and X,
ERISA, the Fair Labor Standards Act, the Worker Adjustment and Retraining
Notification Act, Americans with Disabilities Act of 1990, and any certificate
of occupancy, zoning ordinance, building, environmental or land use requirement
or permit or environmental, labor, employment, occupational safety or health
law, rule or regulation, including Environmental, Health or Safety Requirements
of Law.
"RESERVE REQUIREMENT" means, with respect to a Eurodollar Interest
Period, the maximum aggregate reserve requirement (including all basic,
supplemental, marginal and other reserves) which is imposed under Regulation D
on Eurodollar liabilities.
"REVOLVING CREDIT EXPOSURE" means, with respect to any Lender, without
duplication, at any particular time, the sum of (i) the outstanding principal
amount of the Revolving Loans of such Lender at such time, (ii) the LC
Obligations of such Lender at such time, (iii) the outstanding principal amount
of such Lender's Swing Loans, (iv) such Lender's Outstanding LC Credit Exposure
(other than as included pursuant to clause (ii)); and (v) such Lender's
Outstanding Swing Loan Exposure (other than as included pursuant to clause
(iii)).
"REVOLVING CREDIT OBLIGATIONS" means, at any particular time, the sum
of (i) the outstanding principal amount of the Revolving Loans at such time,
PLUS (ii) the LC Obligations at such time PLUS (iii) the outstanding principal
amount of the Swing Loans at such time.
"REVOLVING LOAN" is defined in SECTION 2.2.
"REVOLVING LOAN COMMITMENT" means, for each Lender, the obligation of
such Lender to make Revolving Loans, to purchase participations in Facility LCs
and LC Obligations and to purchase participations in Swing Loans not exceeding
the amount set forth on SCHEDULE 1.1 hereto
20
28
FINAL EXECUTION COPY
opposite its name thereon under the heading "Revolving Loan Commitment" or as
set forth in any Notice of Assignment relating to any assignment that has
become effective pursuant to SECTION 12.3.2, as such amount may be modified
from time to time pursuant to the terms hereof or to give effect to any
assignment that has become effective pursuant to SECTION 12.3.2.
"REVOLVING LOAN PERCENTAGE" means, with respect to any Lender, the
percentage obtained by dividing (A) such Lender's Revolving Loan Commitment at
such time (in each case, as adjusted from time to time in accordance with the
provisions of this Agreement) by (B) the Aggregate Revolving Loan Commitment at
such time; PROVIDED, HOWEVER, if all of the Revolving Loan Commitments are
terminated pursuant to the terms of this Agreement, then "Revolving Loan
Percentage" means the percentage obtained by dividing (x) the principal amount
of such Lender's Revolving Loans by (y) the aggregate principal amount of all
Revolving Loans.
"REVOLVING LOAN TERMINATION DATE" means November 17, 1998.
"REVOLVING NOTE" means a promissory note, in substantially the form
of EXHIBIT "A-1" hereto, duly executed by the Borrower and payable to the order
of a Lender in the amount of its Revolving Loan Commitment, including any
amendment, restatement, modification, renewal or replacement of such Revolving
Note.
"RISK-BASED CAPITAL GUIDELINES" is defined in SECTION 3.2.
"SECTION" means a numbered section of this Agreement, unless another
document is specifically referenced.
"SELLER" means Melville Corporation, a New York corporation.
"SELLER PREFERRED STOCK" means the Borrower's Series D Cumulative
Convertible Preferred Stock ("SERIES D SELLER PREFERRED STOCK") and Series E
Cumulative Convertible Preferred Stock ("SERIES E SELLER PREFERRED STOCK")
issued to Melville Corporation.
"SERIES D SELLER PREFERRED STOCK" is defined in the definition of
Seller Preferred Stock.
"SERIES E SELLER PREFERRED STOCK" is defined in the definition of
Seller Preferred Stock.
"SINGLE EMPLOYER PLAN" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group. The term "Single Employer Plan" does not include any
Multiemployer Plan.
21
29
FINAL EXECUTION COPY
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill
Corporation, together with any Person succeeding thereto by merger,
consolidation or acquisition of all or substantially all of its assets,
including substantially all of its business of rating securities.
"SPECIFIED DEFAULT" means the occurrence of a Default under SECTION 7.2
or SECTION 7.3(b).
"SPECIFIED INDEBTEDNESS" means, with respect to any Person, long-term
Indebtedness for money borrowed other than:
(a) Capitalized Leases;
(b) purchase money Indebtedness;
(c) Indebtedness the proceeds of which are used (i) for the
construction or improvement of the real property securing such
Indebtedness or (ii) to refinance the cost of construction or
improvement of such real property provided such refinancing occurs
within one hundred eighty (180) days of receipt of the certificate of
occupancy with respect to such construction or improvement;
(d) any extension, renewal, refunding or refinancing of any
amounts under clauses (a) through (d), PROVIDED THAT any such
extension, renewal, refunding or refinancing is in an aggregate
principal amount not greater than the principal amount of and
interest, fees and expenses accrued on, such Indebtedness; and
(e) foreign Subsidiary credit facilities to the extent amounts
borrowed thereunder are not dividended or otherwise distributed by
such foreign Subsidiary to the Borrower or any Facility Guarantor.
"STOCK PURCHASE AGREEMENT" means that certain Stock Purchase Agreement
between the Borrower and the Seller dated as of October 14, 1995.
"SUBSIDIARY" of a Person means (i) any corporation 50% or more of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or
more of its Subsidiaries or by such Person and one or more of its Subsidiaries,
or (ii) any company, partnership, association, joint venture or similar
business organization more than 50% or more of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless the context otherwise provides, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower and shall include Marshalls and its
Subsidiaries.
22
30
FINAL EXECUTION COPY
"SUBSTANTIAL PORTION" means, with respect to the Property of any
Person and its Subsidiaries, Property which:
(a) when aggregated with all other Property in accordance with
SECTION 6.14 (i) represents more than 20% of the consolidated assets
of such Person and its Subsidiaries as would be shown in the
consolidated financial statements of such Person and its Subsidiaries
as at the beginning of the fiscal year in which such determination is
made, or (ii) is responsible for more than 20% of the consolidated net
sales of such Person and its Subsidiaries as reflected in the
financial statements referred to in clause (i) above or
(b) in any individual transaction or series of related
transactions (i) represents more than 10% of the consolidated assets
of such Person and its Subsidiaries as would be shown in the
consolidated financial statements of such Person and its Subsidiaries
as at the beginning of the fiscal year in which such determination is
made, or (ii) is responsible for more than 10% of the consolidated net
sales of such Person and its Subsidiaries as reflected in the
financial statements referred to in clause (i) above.
"SWING LOAN" is defined in SECTION 2.2.2(a).
"SWING LOAN LENDER" means First Chicago, Bank of America Illinois, The
Bank of New York, and Pearl Street, L.P. or their respective Affiliates, in
such Person's capacity as a Swing Loan Lender hereunder with respect to each
Swing Loan made by it. All references contained in this Agreement and the
other Credit Documents to the "Swing Loan Lender" shall be deemed to apply
equally to each of the Swing Loan Lenders set forth above (or its Affiliates)
in their respective capacities as a Swing Loan Lender of any or all Swing Loans
made by each such institution (or its Affiliate).
"TERM LOAN" is defined in SECTION 2.1(a).
"TERM LOAN PERCENTAGE" means, with respect to any Lender, the
percentage obtained by dividing (A) the principal amount of such Lender's Term
Loan by (B) the aggregate principal amount of all Term Loans.
"TERM LOAN TERMINATION DATE" means November 17, 2000.
"TERM NOTE" means a promissory note, in substantially the form
of EXHIBIT "A-2" hereto, duly executed by the Borrower and payable to the order
of a Lender in the amount of its Term Loan, including any amendment,
restatement, modification, renewal or replacement of such Term Note.
"TRADEMARK SUBSIDIARIES" means NBC Fourth Realty Corp., a Nevada
corporation, CDM Corp., a Nevada corporation and any other Nevada corporation
which is a Wholly-Owned Subsidiary
23
31
FINAL EXECUTION COPY
of the Borrower and a Facility Guarantor and the principal function and
activity of which is to hold title to trademarks or service marks used by the
Borrower and its Subsidiaries.
"TRANSACTION COSTS" means the fees, costs and expenses payable by the
Borrower in connection with the execution, delivery and performance of the
Transaction Documents and the consummation of the Marshalls Acquisition.
"TRANSACTION DOCUMENTS" means the Credit Documents, the Seller
Preferred Stock and the Acquisition Documents.
"TRANSFEREE" is defined in SECTION 12.4.
"TYPE" means, with respect to (i) any Advance, its nature as a
Floating Rate Advance or Eurodollar Advance and (ii) any Swing Loan, its nature
as a Money Market Loan.
"UNFUNDED LIABILITIES" means the amount (if any) by which the
actuarial present value of all accrued benefits under all Single Employer Plans
(based on the actuarial assumptions for each such Plan) exceeds the fair market
value of all such Plan assets allocable to such benefits, all determined as of
the then most recent valuation date for such Plans.
"UNMATURED DEFAULT" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"WHOLLY-OWNED SUBSIDIARY" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which (other than directors qualifying
shares and shares required by applicable corporate law to be owned by foreign
nationals and which do not represent greater than 1% of the outstanding voting
securities) shall at the time be owned or controlled, directly or indirectly,
by such Person or one or more Wholly-Owned Subsidiaries of such Person, or by
such Person and one or more Wholly-Owned Subsidiaries of such Person, or (ii)
any company, partnership, association, joint venture or similar business
organization 100% of the ownership interests having ordinary voting power of
which shall at the time be so owned or controlled.
1.2 REFERENCES. Unless the context otherwise provides, any
references to Subsidiaries of the Borrower set forth herein shall, with respect
to representations and warranties which deal with historical matters, be deemed
to include Marshalls and its Subsidiaries.
1.3 ACCOUNTING; CHANGES IN AGREEMENT ACCOUNTING PRINCIPLES. Except
as provided to the contrary herein, all accounting terms used herein shall be
interpreted and all accounting determinations hereunder shall be made in
accordance with Agreement Accounting Principles. If any changes in generally
accepted accounting principles are hereafter required or permitted and are
adopted by the Borrower or any of its Subsidiaries with the agreement of its
independent certified
24
32
FINAL EXECUTION COPY
public accountants and such changes result in a change in the method of
calculation of any of the financial covenants, restrictions or standards herein
or in the related definitions or terms used therein ("ACCOUNTING CHANGES"), the
parties hereto agree, at the Borrower's request, to enter into negotiations, in
good faith, in order to amend such provisions in a credit neutral manner so as
to reflect equitably such Accounting Changes with the desired result that the
criteria for evaluating the Borrower's and its Subsidiaries' financial
condition shall be the same after such Accounting Changes as if such Accounting
Changes had not been made; PROVIDED, HOWEVER, until such provisions are amended
in a manner reasonably satisfactory to the Administrative Agent and the
Required Lenders, no Accounting Change shall be given effect in such
calculations and all financial statements and reports required to be delivered
hereunder shall be prepared in accordance with Agreement Accounting Principles
without taking into account such Accounting Changes. In the event such
amendment is entered into, all references in this Agreement to Agreement
Accounting Principles shall mean generally accepted accounting principles in
effect as of the date of such amendment.
ARTICLE II : THE CREDITS
------------------------
2.1. TERM LOANS. (a) AMOUNT OF TERM LOANS. Subject to the terms and
conditions set forth in this Agreement, each Lender severally and not jointly
agrees to make on the initial Credit Extension Date, a term loan, available in
a single draw in dollars, to the Borrower in an amount equal to the amount set
forth opposite such Lender's name under the heading "Term Loan" on SCHEDULE 1.1
hereto (each individually, a "TERM LOAN" and, collectively, the "TERM LOANS").
All Term Loans shall be made by the Lenders on the initial Credit Extension
Date simultaneously, it being understood that (i) except to the extent
separately agreed in writing between a particular Lender and the Borrower, no
Lender shall be responsible for any failure by any other Lender to perform its
obligation to make any Term Loan hereunder nor shall the Term Loan required of
any Lender be increased as a result of any such failure and (ii) no Lender
shall be obligated to make its Term Loan unless all Lenders are simultaneously
making their Term Loans.
(b) BORROWING NOTICE. The Borrower shall deliver to the
Administrative Agent a Borrowing Notice, signed by it, on the initial Credit
Extension Date. Such Borrowing Notice shall specify instructions for the
disbursement of the proceeds of the Term Loans. The Term Loans shall initially
be Floating Rate Loans and thereafter may be continued as Floating Rate Loans
or converted into Eurodollar Loans in the manner provided in SECTION 2.9 and
subject to the other conditions and limitations therein set forth and set forth
in this ARTICLE II. Any Borrowing Notice given pursuant to this SECTION 2.1(b)
shall be irrevocable.
(c) MAKING OF TERM LOANS. Promptly after receipt of the Borrowing
Notice under SECTION 2.1(b) in respect of the Term Loans, the Administrative
Agent shall notify each Lender by telex or telecopy, or other similar form of
transmission, of the proposed Advance. Each Lender shall deposit an amount
equal to its Term Loan with the Administrative Agent at its office in Chicago,
Illinois, in immediately available funds, on the initial Credit Extension Date
specified in the Borrowing
25
33
FINAL EXECUTION COPY
Notice. Subject to the fulfillment of the conditions precedent set forth in
SECTIONS 4.1 and 4.2, the Administrative Agent shall make the proceeds of such
amounts received by it available to the Borrower at the Administrative Agent's
office in Chicago, Illinois on such initial Credit Extension Date and shall
disburse such proceeds in accordance with the Borrower's disbursement
instructions set forth in such Borrowing Notice.
(d) REPAYMENT OF THE TERM LOANS. (i) The Term Loans shall be repaid
in eighteen (18) consecutive installments, the first seventeen of which shall
be payable quarterly on the last day of each calendar quarter commencing
September 30, 1996 and continuing thereafter to and including September 30,
2000 and the final installment shall be payable on the Term Loan Termination
Date, and the Term Loans shall be permanently reduced by the amount of each
installment on the date payment thereof is required to be made hereunder. The
installments shall be in the aggregate amounts set forth below:
INSTALLMENT DATE INSTALLMENT AMOUNT
---------------- ------------------
September 30, 1996 $15,000,000
December 31, 1996 $35,000,000
March 31, 1997 $10,000,000
June 30, 1997 $10,000,000
September 30, 1997 $10,000,000
December 31, 1997 $45,000,000
March 31, 1998 $10,000,000
June 30, 1998 $10,000,000
September 30, 1998 $10,000,000
December 31, 1998 $45,000,000
March 31, 1999 $10,000,000
June 30, 1999 $10,000,000
September 30, 1999 $10,000,000
December 31, 1999 $45,000,000
March 31, 2000 $20,000,000
June 30, 2000 $20,000,000
September 30, 2000 $20,000,000
Term Loan Termination Date $40,000,000
26
34
FINAL EXECUTION COPY
Notwithstanding the foregoing, the final installment payable on the Term Loan
Termination Date shall be in the amount of the then outstanding principal
balance of the Term Loans. No installment of any Term Loan shall be reborrowed
once repaid.
(ii) In addition to the scheduled payments on the Term Loans, the
Borrower (a) may make the voluntary prepayments described in SECTION 2.7(a) for
credit against the scheduled payments on the Term Loans pursuant to Section 2.7
and (b) shall make the mandatory prepayments prescribed in SECTION 2.7(b), for
credit against such scheduled payments on the Term Loans pursuant to SECTION
2.7.
2.2. The Revolving Credit Loans.
--------------------------
2.2.1 SYNDICATED REVOLVING CREDIT LOANS. From and including
the date of this Agreement and prior to the Revolving Loan Termination Date,
each Lender severally agrees, on the terms and conditions set forth in this
Agreement (including, without limitation, the terms and conditions of SECTION
2.5 and SECTION 8.1 relating to the reduction, suspension or termination of the
Aggregate Revolving Loan Commitment), to make revolving loans (each
individually, a "REVOLVING LOAN" and, collectively, the "REVOLVING LOANS") to
the Borrower from time to time provided no such Revolving Loans shall be
required if after making any such Revolving Loan such Lender's Revolving Credit
Exposure would exceed such Lender's Revolving Loan Commitment. Nothing herein
shall obligate any Lender other than the Swing Loan Lenders to make Swing
Loans. Subject to the terms of this Agreement (including, without limitation,
the terms and conditions of SECTION 2.5 and SECTION 8.1 relating to the
reduction, suspension or termination of the Aggregate Revolving Loan
Commitment), the Borrower may borrow, repay and reborrow Revolving Loans at any
time prior to the Revolving Loan Termination Date. Unless earlier terminated
in accordance with the terms and conditions of this Agreement, the Revolving
Loan Commitments of the Lenders to lend hereunder shall expire on the Revolving
Loan Termination Date. The proceeds of all Revolving Loans made under this
SECTION 2.2.1 shall be used first to repay principal of and accrued and unpaid
interest on any outstanding Swing Loans advanced to Borrower, and thereafter in
accordance with the terms of SECTION 6.2. All outstanding Revolving Loans
shall be paid in full by the Borrower on the Revolving Loan Termination Date.
2.2.2 SWING LOANS. (a) AVAILABILITY. Subject to the terms
and conditions set forth in this Agreement, the Swing Loan Lenders shall make
loans (the "SWING LOANS") to the Borrower, from time to time after the initial
Credit Extension Date and prior to the Revolving Loan Termination Date, up to
an aggregate principal amount at any one time outstanding which shall not
exceed the least of (i) $25,000,000 for all Swing Loans by all Swing Loan
Lenders, (ii) as to each Swing Loan Lender, the amount of such Swing Loan
Lender's Revolving Loan Commitment MINUS such Swing Loan Lender's Revolving
Credit Exposure and (iii) as to each Swing Loan Lender, the amount set forth on
SCHEDULE 1.1 hereto opposite such Swing Loan Lender's name thereon under the
heading "Maximum Swing Loans"; PROVIDED, HOWEVER, at no time shall the
Revolving Credit
27
35
FINAL EXECUTION COPY
Obligations exceed the Aggregate Revolving Loan Commitment. Each of the Swing
Loan Lenders agrees, upon the Borrower's request therefor, promptly to provide
information regarding the applicable interest rate at which such Swing Loan
Lender will make available Swing Loans to the Borrower on the Business Day of
such request or the immediately following Business Day if such request is
received after 1:00 p.m. (Chicago time) (the "MONEY MARKET RATE"), which Money
Market Rate, in any event, shall not exceed the Floating Rate then applicable
to Revolving Loans. All Swing Loans shall be Money Market Rate Loans and shall
otherwise be subject to all the terms and conditions applicable to Revolving
Loans, except that (x) each Swing Loan shall be in a minimum amount of
$1,000,000 and integral multiples of $1,000,000 in excess of that amount and
(y) all interest on the Swing Loans made by a Swing Loan Lender shall be
payable to the Administrative Agent for the account of the applicable Swing
Loan Lender. The Swing Loan Lenders shall not make any Swing Loan in the
period commencing on the first Business Day after receipt of written notice
from any Lender (I) that one or more of the conditions precedent contained in
SECTION 4.2 will not on such date be satisfied until such Lender confirms that
such condition precedent has been met, or (II) that a Default or Unmatured
Default has occurred, and ending when such Default or Unmatured Default no
longer exists, and the Swing Loan Lenders shall not otherwise be required to
determine that, or take notice whether, (x) the conditions precedent set forth
in SECTION 4.2 hereof have been satisfied or (y) a Default or Unmatured Default
has occurred.
(b) BORROWING NOTICE. When the Borrower desires to borrow
under this SECTION 2.2.2, it shall deliver to the Administrative Agent a
Borrowing Notice, signed by it, no later than 11:00 a.m. (Chicago time) on the
date of the proposed Borrowing of a Swing Loan which Borrowing Notice shall
indicate that the Borrower is requesting a Swing Loan pursuant to this SECTION
2.2.2. Such Borrowing Notice shall specify (i) the date of the proposed Swing
Loan (which shall be a Business Day), (ii) the amount of the proposed Swing
Loan, (iii) the Swing Loan Lender or Swing Loan Lenders requested to make such
Swing Loan, (iv) the Money Market Rate or Money Market Rates of each such Swing
Loan Lender as quoted by such Swing Loan Lender to the Borrower under CLAUSE
(a) above and (iv) instructions for the disbursement of the proceeds of the
proposed Swing Loan. Any Borrowing Notice given pursuant to this SECTION
2.2.2(b) shall be irrevocable.
(c) MAKING OF SWING LOANS. Provided the Money Market Rate
set forth in the applicable Borrowing Notice with respect to such Swing Loan
Lender is accurate, each of the applicable Swing Loan Lenders shall promptly
deposit the amount of the Swing Loan requested by the Borrower from it with the
Administrative Agent in immediately available funds on the date of the proposed
Swing Loan applicable thereto. Subject to the fulfillment of the conditions
precedent set forth in SECTIONS 4.1 and 4.2, the Administrative Agent will
promptly make the proceeds of such amounts received by it available to the
Borrower at the Administrative Agent's office in Chicago, Illinois by
depositing such funds to such account with the Administrative Agent as the
Borrower shall designate. Subject to the terms of this Agreement (including,
without limitation, the terms and conditions of SECTION 2.5 and SECTION 8.1
relating to the reduction, suspension or termination of the Aggregate Revolving
Loan Commitment), the Borrower may borrow, repay and reborrow Swing
28
36
FINAL EXECUTION COPY
Loans at any time prior to the Revolving Loan Termination Date. Unless
earlier terminated in accordance with the terms and conditions of this
Agreement, the obligations of the Swing Loan Lenders to make Swing Loans
hereunder shall expire on the Revolving Loan Termination Date.
(d) REPAYMENT OF SWING LOANS. The Borrower shall repay each
Swing Loan on the earlier to occur of (a) the date that is the Revolving Loan
Termination Date and (b) the date that is seven (7) days after the making of
such Swing Loan and if, for any reason the Swing Loans exceed $25,000,000 in
the aggregate, the Borrower shall immediately make a repayment of the Swing
Loans (allocated ratably among all of the outstanding Swing Loans) such that
the aggregate amount of the Swing Loans does not exceed $25,000,000; PROVIDED,
HOWEVER, that nothing in this SECTION 2.2.2 shall be construed as limiting or
modifying the obligation of the Borrower to repay any or all of the outstanding
Swing Loans at any earlier time in accordance with the terms of this Agreement.
Outstanding Swing Loans may be repaid from the proceeds of Revolving Loans or
from the proceeds of Swing Loans. Any repayment of the Swing Loans shall be
accompanied by accrued interest thereon and shall be in the minimum amount of
$500,000 and increments of $100,000 in excess thereof. If Borrower at any time
fails to repay a Swing Loan on the applicable date when due, Borrower shall be
deemed to have elected to borrow a Floating Rate Advance consisting of
Revolving Loans from the Lenders, as of such due date equal in amount to the
unpaid amount of the Swing Loans, and interest thereon, due on such due date.
Such Advance shall be made as of such due date, automatically, without further
notice and without any requirement to satisfy the conditions precedent
otherwise applicable to a Floating Rate Advance if Borrower shall have failed
to make such payment to the Administrative Agent for the account of the
applicable Swing Loan Lender prior to such time. The proceeds of any such
Floating Rate Advance shall be used to repay the Swing Loans and interest
thereon. If, for any reason, Borrower fails to repay a Swing Loan on the
applicable due date and, for any reason, the Lenders are unable to make or have
no obligation to make an Advance, then such Swing Loans shall bear interest
from and after such day, until paid in full, at the interest rate then
applicable to Floating Rate Advances.
(e) PARTICIPATION IN SWING LOANS. Immediately upon the
making of each Swing Loan, each Lender shall be deemed to have automatically,
irrevocably and unconditionally purchased and received from the applicable
Swing Loan Lender an undivided interest and participation in and to such Swing
Loan and the obligations of Borrower in respect thereof in an amount equal to
the amount of such Swing Loan multiplied by such participating Lender's
Revolving Loan Percentage. The Administrative Agent will notify each Lender
promptly if Borrower fails to pay the Administrative Agent for the account of
the applicable Swing Loan Lender amounts required to be paid by it under
SECTION 2.2.2(d) with respect to any Swing Loan and each Lender shall promptly
and unconditionally pay to the Administrative Agent for the account of the
applicable Swing Loan Lender, in immediately available funds an amount equal to
such Lender's Revolving Loan Percentage of the amount due from the Borrower
with respect thereto (without duplication as to amounts funded as Revolving
Loans under CLAUSE (d) used to repay such Swing Loans). The obligation of each
Lender to pay the Administrative Agent for the account of the Swing Loan
29
37
FINAL EXECUTION COPY
Lenders under this SECTION 2.2.2(e) shall be unconditional, continuing,
irrevocable and absolute. In the event that any Lender fails to make payment
to the Administrative Agent of any amount due under this SECTION 2.2.2(e), the
Administrative Agent shall be entitled to receive, retain and apply against
such obligation the principal and interest otherwise payable to such Lender
hereunder until the Administrative Agent on behalf of the Swing Loan Lenders
receives such payment from such Lender or such obligation is otherwise fully
satisfied; PROVIDED, HOWEVER, that nothing contained in this sentence shall
relieve such Lender of its obligation to reimburse the Administrative Agent,
such amount in accordance with this SECTION 2.2.2(e). If any amount required
to paid under this Section is not in fact made available to the Administrative
Agent for remittance to the Swing Loan Lenders as described above by any
Lender, such Swing Loan Lenders shall be entitled to recover such amount on
demand from such Lender, together with accrued interest thereon from the date
of demand therefor on any Business Day until the date such amount is paid to
the Administrative Agent by such Lender, for one (1) Business Day at the
Federal Funds Effective Rate and thereafter at the interest rate applicable to
such Swing Loans. The failure of any Lender to pay such amount to the
Administrative Agent shall not relieve any other Lender of its obligation to
make the payment to be made by it. Upon the purchase by each Lender of a
participation in any Swing Loans pursuant to this SECTION 2.2.2, such Lender
shall be deemed to have made a Floating Rate Loan under SECTION 2.2.1 in the
amount of such participation, and such Swing Loans shall be deemed to have been
repaid in such amount.
2.3. RATABLE LOANS. Each Advance under SECTION 2.2.1 shall consist
of Revolving Loans made from the several Lenders ratably in proportion to the
ratio that their respective Revolving Loan Commitments bear to the Aggregate
Revolving Loan Commitment.
2.4. TYPES OF ADVANCES. The Advances with respect to Revolving Loans
and Term Loans may be Floating Rate Advances or Eurodollar Advances, or a
combination thereof, selected by the Borrower in accordance with SECTIONS 2.8
and 2.9. The Swing Loans shall be Money Market Rate Loans.
2.5. FACILITY FEE; REDUCTIONS IN AGGREGATE REVOLVING LOAN COMMITMENT.
The Borrower agrees to pay to the Administrative Agent for the pro rata account
of the Lenders according to their Revolving Loan Percentages, a facility fee
("FACILITY FEE") accruing at the per annum rate of the Applicable Facility Fee
from and including the date of this Agreement until the Revolving Loan
Termination Date on the Aggregate Revolving Loan Commitment, payable on each
Payment Date hereafter, on the date of any reduction of the Aggregate Revolving
Loan Commitment with respect to the amount so reduced and on the Revolving Loan
Termination Date. The Facility Fee shall be calculated on the basis of a
360-day year for the actual days elapsed. The Borrower may permanently reduce
the Aggregate Revolving Loan Commitment in whole, or in part ratably among the
Lenders in integral multiples of $25,000,000, upon at least three Business
Days' written notice to the Administrative Agent, which notice shall specify
the amount of any such reduction; PROVIDED, that the amount of the Aggregate
Revolving Loan Commitment may not be reduced below the Revolving
30
38
FINAL EXECUTION COPY
Credit Obligations. All accrued Facility Fees shall be payable on the
effective date of any reduction of the Revolving Loan Commitments with respect
to the amount so reduced and on the termination of the Revolving Loan
Commitments of the Lenders.
2.6. MINIMUM AMOUNT OF EACH ADVANCE. Each Eurodollar Advance shall be
in the minimum amount of $25,000,000 (and an integral multiple of $5,000,000 if
in excess thereof) and each Floating Rate Advance shall be in the minimum
amount of $10,000,000 (and an integral multiple of $1,000,000 if in excess
thereof); PROVIDED, that any Floating Rate Advance may be in the amount of (i)
the Available Aggregate Revolving Loan Commitment and (ii) any Floating Rate
Advance required to be made in connection with the required repayment of a
Swing Loan under SECTION 2.2.2(d). In addition, the Borrower shall select
Eurodollar Interest Periods under SECTIONS 2.8 and 2.9 so that no more than
fifteen (15) Eurodollar Interest Periods shall be outstanding at any one time.
2.7. OPTIONAL PRINCIPAL PAYMENTS; MANDATORY PREPAYMENTS.
(a) OPTIONAL PRINCIPAL PAYMENTS. The Borrower may from time
to time pay, without penalty or premium, all outstanding Floating Rate
Advances, or, in a minimum amount of $10,000,000 (and an integral multiple of
$1,000,000 if in excess thereof), any portion of the outstanding Floating Rate
Advances upon one Business Day's prior notice to the Administrative Agent. In
addition, the Borrower may from time to time upon five Business Days' notice to
the Administrative Agent, pay all, or in a minimum amount of $10,000,000 and an
integral multiple of $1,000,000, a portion, of any outstanding Eurodollar
Advance, on a date other than the last day of the applicable Eurodollar
Interest Period; PROVIDED, that the Borrower shall be required to make any
funding indemnification payments required by SECTION 3.4 in connection
therewith. In addition the Borrower may from time to time pay all outstanding
Money Market Rate Loans, or, in a minimum amount of $1,000,000 (and a multiple
of $1,000,000 in excess thereof) any portion of any outstanding Money Market
Rate Loan; PROVIDED, that the Borrower shall be required to make any funding
indemnification payments required by SECTION 3.4 in connection therewith. In
connection with each optional principal payment the Borrower shall advise the
Administrative Agent whether such payment is in respect of the Swing Loans,
Revolving Loans or Term Loans. Unless otherwise designated by the Borrower,
payments in respect of the Swing Loans shall be applied ratably to each of the
outstanding Swing Loans. Optional payments in respect of Term Loans shall be
applied to the unpaid installments of the Term Loans on a pro-rata basis.
Unless otherwise designated by the Borrower (provided the Borrower shall be
required in connection with any such designation to make any funding
indemnification payments required by SECTION 3.4), payments in respect of
Revolving Loans and Term Loans shall be applied first to Floating Rate Loans
and then to any Eurodollar Rate Loans maturing on such date. The
Administrative Agent shall hold the remaining portion of such payments as cash
collateral in an interest bearing account and shall apply funds from such
account to subsequently maturing Eurodollar Rate Loans in order of maturity
unless otherwise directed by
31
39
FINAL EXECUTION COPY
the Borrower (provided the Borrower shall be required in connection with any
such direction to make any funding indemnification payments required by SECTION
3.4).
(b) Mandatory Prepayments.
---------------------
(i) Upon the consummation of any Asset-Equity Sale (other than an
Excluded Asset Sale or Excluded Equity Issuance), by the
Borrower or any Subsidiary, the Net Cash Proceeds of which are
(in such transaction or when aggregated with all such other
Asset-Equity Sales which are part of a series of related
transactions) greater than $10,000,000, within five (5)
Business Days after the Borrower's or any of such
Subsidiaries' consummation of such Asset-Equity Sale, the
Borrower shall make or cause to be made a mandatory prepayment
of the Obligations in an amount equal to (y) one hundred
percent (100%) of such Net Cash Proceeds in the case of
Asset-Equity Sales other than in connection with the issuance
of Capital Stock and (z) fifty percent (50%) of such Net Cash
Proceeds in the case of Asset-Equity Sales consisting of the
issuance of Capital Stock; PROVIDED, if the purchase price for
any such Asset-Equity Sale includes any deferred purchase
price payments, earnouts or performance based payments which
are to be made subsequent to the consummation of such
Asset-Equity Sale, the amount of which has not been included
in the calculation of Net Cash Proceeds as of the time of the
consummation of such Asset-Equity Sale, then within five (5)
Business Days after the Borrower's or any of such
Subsidiaries' receipt of any such deferred purchase price
payments, earnouts or performance based payments, the Borrower
shall make or cause to be made a mandatory prepayment of the
Obligations in an amount equal to one hundred percent (100%)
of such deferred purchase price payments, earnouts or
performance based payments.
(ii) Within five (5) Business Days after the receipt by the
Borrower or any Subsidiary of any proceeds of Specified
Indebtedness, the Borrower shall make or cause to be made a
mandatory prepayment in an amount equal to one hundred percent
(100%) of the principal amount of such Specified Indebtedness
MINUS all reasonable fees, costs and expenses related to the
issuance and placement of such Specified Indebtedness.
(iii) Within five (5) Business Days after the Borrower's or any
Subsidiaries' consummation of any Excluded Asset Sale, the
Borrower shall make or cause to be made a mandatory prepayment
of the Obligations in an amount equal to the difference (if a
positive number) between: (A) one hundred percent (100%) of
the Net Cash Proceeds of such Excluded Asset Sale and (B) the
lesser of (i) $25,000,000 and (ii) the amount required to be
paid in redemption of the Series D Seller Preferred Stock.
32
40
FINAL EXECUTION COPY
(iv) Within five (5) Business Days after the consummation of any
Excluded Equity Issuance, the Borrower shall make or cause to
be made a mandatory prepayment of the Obligations in an amount
equal to fifty percent (50%) of the difference (if a positive
number) between (a) the Net Cash Proceeds of such Excluded
Equity Issuance and (b) the amount paid in redemption or other
repurchase of Preferred Stock of the Borrower, or any part
thereof.
Nothing in this SECTION 2.7(b) shall be construed to constitute the Lenders'
consent to any transaction referred to in CLAUSE (i), (ii), (iii) or (iv) above
which is not expressly permitted by the terms of this Agreement. Each
mandatory prepayment required by CLAUSES (i), (ii), (iii) and (iv) of this
SECTION 2.7(b) shall be referred to herein as a "DESIGNATED PREPAYMENT".
Designated Prepayments shall be allocated and applied to the Obligations as
follows:
(I) the amount of each Designated Prepayment shall be applied to
the unpaid installments of the Term Loans on a pro- rata
basis; and
(II) except as set forth below, following the payment in full of
the Term Loans, the amount of each Designated Prepayment shall
be applied to repay Revolving Loans (but shall not reduce
Revolving Loan Commitments) and following the payment in full
of the Revolving Loans, the amount of each Designated
Prepayment shall be applied first to repay outstanding Swing
Loans, then to interest on the Reimbursement Obligations, then
to principal on the Reimbursement Obligations, then to fees on
account of Facility LCs and then, to the extent any LC
Obligations are contingent, deposited with the Administrative
Agent as cash collateral in respect of such LC Obligations;
PROVIDED, HOWEVER, in the event that the Borrower fulfills all
of the conditions precedent set forth in SECTIONS 4.1 and 4.2
(provided no Borrowing Notice in connection therewith shall be
required) as of the date such Designated Prepayment would be
subject to application under this CLAUSE (II), the proceeds of
the remainder of such Designated Prepayment (after the payment
in full of the Term Loans) shall not be required to be paid by
the Borrower as a prepayment of the Revolving Loans, Swing
Loans or other Obligations.
On the date any Designated Prepayment is received by the Administrative Agent,
such prepayment shall be applied first to Floating Rate Loans and to any
Eurodollar Rate Loans maturing on such date. Except as set forth in CLAUSE
(II) above, the Administrative Agent shall hold the remaining portion of such
Designated Prepayment as cash collateral in an interest bearing deposit account
and shall apply funds from such account to repay subsequently maturing
Eurodollar Rate Loans in order of maturity (which Eurodollar Rate Loans shall
continue to accrue interest at the applicable Eurodollar Rate until such
repayment has been made). Notwithstanding the foregoing, the Borrower may
designate a different application of such Designated Prepayments as between
Floating Rate Loans and Eurodollar Loans or among Eurodollar Loans; PROVIDED,
that the Borrower shall be
33
41
FINAL EXECUTION COPY
required to make any funding indemnification payments required by SECTION 3.4
in connection therewith.
(c) MANDATORY REDUCTION OF AGGREGATE REVOLVING CREDIT OBLIGATIONS.
Notwithstanding anything in this Agreement to the contrary, the Borrower shall
be required during each five-month period from November 1 through March 31 of
each year, to reduce the Adjusted Short Term Loan Obligations to less than
$100,000,000 for a consecutive 30-day period and shall make a mandatory
prepayment of the Swing Loans and/or Revolving Loans and if such amounts have
been fully repaid the other Short Term Loan Obligations at such times and in
such amounts as shall be necessary to comply with the requirements of this
SECTION 2.7(c).
2.8. METHOD OF SELECTING TYPES AND INTEREST PERIODS FOR ADVANCES. The
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Advance, the Eurodollar Interest Period applicable to each Advance from time to
time. The Borrower shall give the Administrative Agent irrevocable notice (a
"BORROWING NOTICE") not later than 11:00 a.m.(Chicago time) on the Borrowing
Date of each Floating Rate Advance and three Business Days before the Borrowing
Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Eurodollar Interest
Period applicable thereto.
Not later than 1:00 p.m. (Chicago time) on each Borrowing Date, each Lender
shall make available its Revolving Loan or Revolving Loans, in funds
immediately available in Chicago to the Administrative Agent at its address
specified pursuant to ARTICLE XIII. Subject to the fulfillment of the
conditions precedent set forth in SECTIONS 4.1 and 4.2, the Administrative
Agent will make the funds so received from the Lenders available to the
Borrower at the Administrative Agent's aforesaid address.
2.9. CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances. Each Eurodollar
Advance shall continue as a Eurodollar Advance of such Type until the end of
the then applicable Eurodollar Interest Period therefor, at which time such
Eurodollar Advance shall be automatically converted into a Floating Rate
Advance unless the Borrower shall have given the Administrative Agent a
Conversion/Continuation Notice requesting that, at the end of such Eurodollar
Interest Period, such Eurodollar Advance continue as a Eurodollar
34
42
FINAL EXECUTION COPY
Advance for the same or another Eurodollar Interest Period. Subject to the
terms of SECTION 2.6, the Borrower may elect from time to time to convert all
or any part of an Advance of any Type (other than with respect to Swing Loans)
into any other Type or Types of Advances (other than Swing Loan Advances);
provided that any conversion of any Eurodollar Advance shall be made on, and
only on, the last day of the Eurodollar Interest Period applicable thereto.
The Borrower shall give the Administrative Agent irrevocable notice (a
"CONVERSION/CONTINUATION NOTICE") of each conversion of a Floating Rate Advance
or continuation of a Eurodollar Advance not later than 11:00 a.m. (Chicago
time) at least three Business Days prior to the date of the requested
conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued; and
(iii) the amount and Type(s) of Advance(s) into which such Advance
is to be converted or continued and, in the case of a
conversion into or continuation of a Eurodollar Advance, the
duration of the Eurodollar Interest Period applicable thereto.
2.10. DETERMINATION OF INTEREST RATE; DETERMINATION OF APPLICABLE
EURODOLLAR MARGINS AND APPLICABLE FEES.
(a) Each Floating Rate Advance shall bear interest on the outstanding
principal amount thereof, for each day from and including the date such Advance
is made or is converted from a Eurodollar Advance into a Floating Rate Advance
pursuant to SECTION 2.9 to but excluding the date it becomes due or is
converted into a Eurodollar Advance pursuant to SECTION 2.9, at a rate per
annum equal to the Floating Rate for such day. Changes in the rate of interest
on each Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. Each Eurodollar
Advance shall bear interest from and including the first day of the Interest
Period applicable thereto to (but not including) the last day of such Interest
Period at the Eurodollar Rate determined as applicable to such Eurodollar
Advance. No Interest Period may end after the Revolving Loan Termination Date
with respect to the Revolving Loans or after the Term Loan Termination Date
with respect to the Term Loans. Each Swing Loan shall bear interest on the
outstanding principal amount thereof, for each day from and including the date
such Swing Loan is made to but excluding the date it becomes due, at a rate per
annum equal to the applicable Money Market Rate.
(b) The Applicable Eurodollar Margins with respect to Advances and the
Applicable Fees for any period shall be determined on the basis of the publicly
announced ratings ("CREDIT RATINGS") by ▇▇▇▇▇'▇ and S&P on the Borrower's Rated
Debt during such period, in each case in accordance
35
43
FINAL EXECUTION COPY
with the table set forth below and the provisions of SECTION 2.19 with respect
to Applicable LC Fees, the Applicable Eurodollar Margins and the Applicable
Fees to change when and as such Credit Ratings change. For purposes of
determining the Applicable Eurodollar Margins and the Applicable Fees with
respect to any period:
(i) Any change in the Credit Rating shall be deemed to become
effective on the date of public announcement thereof and shall
remain in effect until the date of public announcement that
such Credit Rating shall no longer be in effect. If any
change in Credit Rating occurs during an Interest Period, the
new Applicable Eurodollar Margins and Applicable Fees shall
become effective from the date of the public announcement.
(ii) If, during any period, either ▇▇▇▇▇'▇ or S&P shall not have a
publicly-announced Credit Rating with respect to the
Borrower's Rated Debt, the Credit Rating announced by the
other rating agency with respect thereto shall be used.
(iii) Except as provided below, in the event that the Credit Ratings
publicly announced by ▇▇▇▇▇'▇ and S&P with respect to the
Borrower's Rated Debt appear in more than one column of the
table, the Applicable Eurodollar Margins and the Applicable
Fees will be based on the column which includes the lowest
rating; PROVIDED, in the event that the Credit Ratings
announced are either A- from S&P or A3 from ▇▇▇▇▇'▇ but the
other Credit Rating is either BBB+ from S&P or Baa1 from
▇▇▇▇▇'▇, the Applicable Eurodollar Margins and the Applicable
Fees shall be the margins set forth under the column entitled
"At Least A- or A3 or Above"; and PROVIDED, FURTHER, in the
event that the Credit Ratings announced are either an A- from
S&P or an A3 from ▇▇▇▇▇'▇ but the other Credit Rating is
either BBB from S&P or Baa2 from ▇▇▇▇▇'▇, the Applicable
Eurodollar Margins and the Applicable Fees shall be the
margins set forth under the column entitled "At Least BBB+ and
Baa1."
(iv) If, during any period, neither ▇▇▇▇▇'▇ nor S&P shall have
publicly announced a Credit Rating with respect to the
Borrower's Rated Debt, the Applicable Eurodollar Margins and
the Applicable Fees shall be the margins set forth under the
column entitled "Below BBB- or Baa3 or Unrated."
(v) Notwithstanding the foregoing, the initial Applicable
Eurodollar Margins and the initial Applicable Fees shall be
the margins and fees determined by reference to the column
entitled "At least BBB and Baa2" and shall remain at such
levels until sixty (60) days following the date of the initial
Credit Extension; PROVIDED if during such 60-day period the
Credit Ratings publicly announced by ▇▇▇▇▇'▇ and S&P with
respect to the Borrower's Rated Debt have been affirmed by S&P
and ▇▇▇▇▇'▇, the Applicable Eurodollar Margins and Applicable
Fees shall be determined based upon
36
44
FINAL EXECUTION COPY
the table below in accordance with such affirmed ratings. If
the Credit Ratings publicly announced by ▇▇▇▇▇'▇ and S&P with
respect to the Borrower's Rated Debt have not been affirmed
within such 60-day period, then the Applicable Eurodollar
Margins and the Applicable Fees shall be determined by
reference to the column entitled "At Least BBB- or Baa3"
commencing with the 60th day following the date of the initial
Credit Extension and continuing until such Credit Ratings have
been affirmed by each of S&P and ▇▇▇▇▇'▇.
APPLICABLE EURODOLLAR MARGINS
AND APPLICABLE FEES (IN PERCENTAGES)
------------------------------------------------------------------------------------------------------------
CREDIT AT LEAST A- AT LEAST AT LEAST AT LEAST BELOW
RATINGS OR A3 OR BBB+AND BBB AND BBB-AND BBB- OR
ABOVE ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ OR
UNRATED
------------------------------------------------------------------------------------------------------------
Applicable
Eurodollar
Margin for .35% .425% .50% .70% .875%
Revolving
Loans
------------------------------------------------------------------------------------------------------------
APPLICABLE
EURODOLLAR .50% .625% .75% 1.00% 1.25%
MARGIN FOR
TERM LOANS
------------------------------------------------------------------------------------------------------------
APPLICABLE .15% .20% .25% .30% .375%
FACILITY FEE
============================================================================================================
2.11. RATES APPLICABLE AFTER DEFAULT. Notwithstanding anything to the
contrary contained in this Agreement, after the occurrence and during the
continuance of a Default or Unmatured Default, the Required Lenders may, at
their option, by notice to the Borrower, declare that no Advance may be made
as, converted into or continued as a Eurodollar Advance. After the occurrence
and during the continuance of any Default, the Required Lenders may, at their
option, by notice to the Borrower, (a) require that interest be paid on demand
or more frequently than as required pursuant to SECTION 2.14 and/or (b) declare
that (i) each Advance and each Swing Loan shall bear interest at a rate per
annum equal to the Floating Rate PLUS 2% per annum and (ii) the Applicable LC
Fee shall be increased by 2% per annum.
2.12. METHOD OF PAYMENT. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Administrative Agent at the Administrative Agent's
address specified pursuant to ARTICLE XIII, or at any other
37
45
FINAL EXECUTION COPY
Lending Installation of the Administrative Agent specified in writing by the
Administrative Agent to the Borrower, by 1:00 p.m. (local time at the place of
payment) on the date when due and shall be applied ratably (unless such
payments are for the account of specific Lenders, LC Issuers, Co-Arrangers or
Swing Loan Lenders under the terms hereof) by the Administrative Agent among
the Lenders. Any payment received by the Administrative Agent after such time
shall be deemed to have been received on the next Business Day. Each payment
delivered to the Administrative Agent for the account of any Lender, LC Issuer,
Swing Loan Lender or Co- Arranger shall be delivered promptly by the
Administrative Agent to such Person in the same type of funds that the
Administrative Agent received at its address specified pursuant to ARTICLE XIII
or at any Lending Installation specified in a notice received by the
Administrative Agent from such Person. The Administrative Agent is hereby
authorized to charge the account of the Borrower maintained with First Chicago
for each payment of principal, interest and fees as it becomes due hereunder.
2.13. NOTES; TELEPHONIC NOTICES. Each Lender is hereby authorized to
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Note, provided, however, that the failure to so record
shall not affect the Borrower's obligations under such Note or with respect to
the Loans. The Borrower hereby authorizes the Lenders, the Swing Loan Lenders,
the LC Issuers and the Administrative Agent to extend, convert or continue
Advances, extend Swing Loans, issue Facility LCs, effect selections of Types of
Advances and transfer funds based on telephonic notices made by any person or
persons the Administrative Agent or any Lender in good faith believes to be an
Authorized Officer acting on behalf of the Borrower. The Borrower agrees to
deliver promptly to the Administrative Agent a written confirmation, if such
confirmation is requested by the Administrative Agent or any Lender, of each
telephonic notice signed by an Authorized Officer. If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the Lenders
shall govern absent manifest error.
2.14. INTEREST PAYMENT DATES; INTEREST AND FEE BASIS. Interest
accrued on each Floating Rate Loan and each Swing Loan (if not earlier paid in
accordance with SECTION 2.11) shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof, and, with respect to
any Swing Loan, on any date on which such Swing Loan is repaid or prepaid,
whether due to acceleration or otherwise and at maturity. Interest accrued on
each Floating Rate Loan shall also be payable on any date on which such
Floating Rate Loan is prepaid or repaid due to acceleration or at maturity.
Interest accrued on that portion of the outstanding principal amount of any
Floating Rate Advance converted into a Eurodollar Advance on a day other than a
Payment Date shall be payable on the Payment Date immediately following such
conversion. Interest accrued on each Eurodollar Advance shall be payable on the
last day of the applicable Interest Period, on any date on which such
Eurodollar Advance is prepaid, whether by acceleration or otherwise, and at
maturity. Interest accrued on each Eurodollar Advance having an Interest
Period longer than three months shall also be payable on the last day of each
three-month interval during such Interest Period. Interest on all Eurodollar
Advances shall be calculated for actual days elapsed on the basis of a
38
46
FINAL EXECUTION COPY
360-day year. Interest on all Floating Rate Advances and all Swing Loans shall
be calculated for actual days elapsed on the basis of a 365/366-day year.
Interest shall be payable for the day a Loan is made but not for the day of any
payment on the amount paid and applied to such Loan if payment is received
prior to 1:00 p.m. (local time) at the place of payment. If any payment of
principal of or interest on a Loan shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such extension of time shall be
included in computing interest in connection with such payment.
2.15. NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND
REVOLVING LOAN COMMITMENT REDUCTIONS. Promptly after receipt thereof, the
Administrative Agent will notify each Lender of the contents of each Aggregate
Revolving Loan Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by it hereunder.
The Administrative Agent will notify each Lender of the interest rate
applicable to each Eurodollar Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate. Each Reference Bank agrees to furnish timely information
to the Administrative Agent for the purpose of determining the Eurodollar Rate.
2.16. LENDING INSTALLATIONS. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written or
facsimile notice to the Administrative Agent and the Borrower, designate a
Lending Installation through which Loans will be made by it and for whose
account Loan payments are to be made.
2.17. NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT. Unless the
Borrower, a Lender or a Swing Loan Lender, as the case may be, notifies the
Administrative Agent prior to the time at which it is scheduled to make payment
to the Administrative Agent for payments to be made on a same-day basis and
otherwise prior to the date on which it is scheduled to make a payment to the
Administrative Agent of (i) in the case of a Lender or a Swing Loan Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Administrative Agent for the account of the Lenders,
Swing Loan Lenders or LC Issuers, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of
such payment available to the intended recipient in reliance upon such
assumption. If such Lender, Swing Loan Lender or the Borrower, as the case may
be, has not in fact made such payment to the Administrative Agent, the
recipient of such payment shall, on demand by the Administrative Agent, repay
to the Administrative Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Administrative Agent until the date the
Administrative Agent recovers such amount at a rate per annum equal to (i) in
the case of repayment by a Lender or Swing Loan Lender, the Federal Funds
39
47
FINAL EXECUTION COPY
Effective Rate for such day or (ii) in the case of repayment by the Borrower,
the interest rate applicable to the relevant Loan.
2.18. WITHHOLDING TAX EXEMPTION. At least five Business Days prior to
the first date on which interest or fees are payable hereunder for the account
of any Lender, Swing Loan Lender or LC Issuer, each Lender, Swing Loan Lender
or LC Issuer that is not incorporated under the laws of the United States of
America, or a state thereof, agrees that it will deliver to each of the
Borrower and the Administrative Agent two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, certifying in either case
that such Lender, LC Issuer or Swing Loan Lender is entitled to receive
payments under this Agreement and the Notes without deduction or withholding of
any United States federal income taxes. Each Lender, Swing Loan Lender or LC
Issuer which so delivers a Form 1001 or 4224 further undertakes to deliver to
each of the Borrower and the Administrative Agent two additional copies of such
form (or a successor form) on or before the date that such form expires
(currently, three successive calendar years for Form 1001 and one calendar year
for Form 4224) or becomes obsolete or after the occurrence of any event
requiring a change in the most recent forms so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Administrative Agent, in each case certifying
that such Lender, Swing Loan Lender or LC Issuer is entitled to receive
payments under this Agreement and the Notes without deduction or withholding of
any United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender, Swing Loan Lender
or LC Issuer from duly completing and delivering any such form with respect to
it and such Lender, Swing Loan Lender or LC Issuer advises the Borrower and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
2.19. FACILITY LCS.
(a) Each of the LC Issuers hereby agrees, subject to satisfaction of
the conditions precedent contained in SECTIONS 4.1 and 4.2 (the satisfaction of
which the applicable LC Issuer shall have no duty to ascertain), on the terms
and conditions set forth in this Agreement, to issue stand-by and commercial
letters of credit (each, a "FACILITY LC") and to renew, extend, increase,
decrease or otherwise modify each Facility LC (each a "MODIFICATION"), from
time to time from and including the date of this Agreement and prior to the
Revolving Loan Termination Date upon the request of the Borrower; PROVIDED that
immediately after each such Facility LC is issued or after each such
Modification, (i) the aggregate amount of the outstanding LC Obligations shall
not exceed $100,000,000 and (ii) the Revolving Credit Obligations shall not
exceed the Aggregate Revolving Loan Commitment; PROVIDED, FURTHER, that if the
Borrower has requested a Lender other than First Chicago, Bank of America
Illinois or The Bank of New York (the "DESIGNATED ISSUERS") to act as LC Issuer
with respect to the issuance or Modification of a particular Facility LC, such
issuance or Modification shall be made only in the sole discretion of such
Lender; and PROVIDED, FURTHER, that no Designated Issuer shall be obligated to
issue a Facility LC if, after taking into account the requested LC: (i) the
aggregate amount of such Designated Issuer's LC Obligations would exceed
40
48
FINAL EXECUTION COPY
the amount set forth on SCHEDULE 1.1 hereto opposite such Designated Issuer's
name thereon under the heading "Maximum Facility LC Amount" or (ii) the
aggregate amount of such Designated Issuer's Revolving Credit Exposure would
exceed its Revolving Loan Commitment. No Facility LC shall have an expiry date
later than the earlier of (i) the date that is three (3) Business Days prior to
the Revolving Loan Termination Date and (ii) the day which is one year after
the date of issuance (or the most recent Modification) thereof. No LC Issuer
shall issue any Facility LC in the period commencing on the first Business Day
after receipt of written notice from any Lender (I) that one or more of the
conditions precedent contained in SECTION 4.2 will not on such date be
satisfied until such LC Issuer confirms that such condition precedent has been
met, or (II) that a Default or Unmatured Default has occurred, and ending when
such Default or Unmatured Default no longer exists, and the LC Issuers shall
not otherwise be required to determine that, or take notice whether, (x) the
conditions precedent set forth in SECTION 4.2 hereof have been satisfied or (y)
a Default or Unmatured Default has occurred.
(b) Upon the issuance or Modification by a LC Issuer of a Facility LC
in accordance with this SECTION 2.19, such LC Issuer shall be deemed, without
further action by any party hereto, to have sold to each Lender, and each
Lender shall be deemed, without further action by any party hereto, to have
purchased from the applicable LC Issuer, a participation in such Facility LC
(and each Modification thereof) and the related LC Obligations in proportion to
its Revolving Loan Percentage.
(c) Subject to subsection (a), the Borrower shall give the applicable
LC Issuer (with a copy to the Administrative Agent) notice prior to 11:00 a.m.
(Chicago time) at least three Business Days prior to the proposed date of
issuance or Modification of each Facility LC, specifying the beneficiary, the
proposed date of issuance (or Modification) and the expiry date of such
Facility LC, and describing the proposed terms of such Facility LC and the
nature of the transactions proposed to be supported thereby. Upon receipt of
such notice, the applicable LC Issuer shall promptly notify the Administrative
Agent. Periodically or upon the request of any Lender, the Administrative
Agent shall notify each Lender of the amount of such Lender's participation in
Facility LCs. The issuance or Modification by any LC Issuer of any Facility LC
shall, in addition to the conditions precedent set forth in ARTICLE IV (the
satisfaction of which the applicable LC Issuer shall have no duty to
ascertain), be subject to the conditions precedent that such Facility LC shall
be satisfactory to the applicable LC Issuer and that the Borrower shall have
executed and delivered such application agreement and/or such other instruments
and agreements relating to such Facility LC as the LC Issuer shall have
reasonably requested (each, a "FACILITY LC APPLICATION AGREEMENT"). In the
event of any conflict between the terms of this Agreement and the terms of any
Facility LC Application Agreement, the terms of this Agreement shall control.
(d) The Borrower shall pay to the Administrative Agent, for the
account of the Lenders ratably in accordance with their respective Revolving
Loan Percentages, a per annum letter of credit fee equal to (i) a percentage
equal to the Applicable Eurodollar Margin for Revolving Loans determined under
SECTION 2.10 in effect from time to time on the average daily aggregate amount
available for drawing under all financial or stand-by Facility LCs and (ii) a
percentage equal to the Applicable Eurodollar Margin for Revolving Loans
determined under SECTION 2.10 in effect from
41
49
FINAL EXECUTION COPY
time to time MINUS twenty-five (25) basis points on the average daily aggregate
amount available for drawing under all commercial or trade Facility LCs. Each
such fee shall be payable in arrears on each Payment Date and on the Revolving
Loan Termination Date; provided that fees payable on each Payment Date shall be
for the period ending on the fifth (5th) Business Day immediately preceding
such Payment Date. The LC Issuers shall furnish to the Administrative Agent
upon request the LC Issuers' calculations with respect to the amount of any fee
payable under the prior sentence of this subsection (d). In addition, the
Borrower shall pay to the LC Issuers such additional fees, fronting fees and
expenses relating to issuance, amendment, Modification and payment of Facility
LCs in the amounts and at the times agreed between the Borrower and the LC
Issuers.
(e) Upon receipt from the beneficiary of any Facility LC of any
demand for payment under such Facility LC, the applicable LC Issuer shall
notify the Borrower and the Administrative Agent and the Administrative Agent
shall promptly notify each other Lender as to the amount to be paid by such LC
Issuer as a result of such demand and the proposed payment date (the "LC
PAYMENT DATE"). The responsibility of the applicable LC Issuer to the Borrower
and each Lender shall be only to determine that the documents (including each
demand for payment) delivered under each Facility LC issued by it in connection
with such presentment shall be in conformity in all material respects with such
Facility LC. The applicable LC Issuer shall endeavor to exercise the same care
in the issuance, Modification and administration of the Facility LCs as it does
with respect to letters of credit in which no participations are granted, it
being understood that in the absence of any Gross Negligence or willful
misconduct by the applicable LC Issuer, each Lender shall be unconditionally
and irrevocably liable without regard to the occurrence of any Default or
Unmatured Default or any condition precedent whatsoever, to reimburse such LC
Issuer on demand for (i) such Lender's Revolving Loan Percentage of the amount
of each payment made by such LC Issuer under each Facility LC to the extent
such amount is not reimbursed by the Borrower pursuant to subsection (f) below
plus (ii) interest on the foregoing amount to be reimbursed by such Lender, for
each day from the date of such LC Issuer's demand for such reimbursement (or,
if such demand is made after 11:00 a.m. (Chicago time) on such date, from the
next succeeding Business Day) to the date on which such Lender pays the amount
to be reimbursed by it, at a rate of interest per annum equal to the Federal
Funds Effective Rate for such day.
(f) The Borrower shall be irrevocably and unconditionally obligated
to reimburse the applicable LC Issuer on or by the applicable LC Payment Date
for any amounts to be paid by such LC Issuer upon any drawing under any
Facility LC, without presentment, demand, protest or other formalities of any
kind; PROVIDED that neither the Borrower nor any Lender shall hereby be
precluded from asserting any claim for direct (but not consequential) damages
suffered by the Borrower or such Lender to the extent, but only to the extent,
caused by (i) the willful misconduct or Gross Negligence of the applicable LC
Issuer in determining whether a request presented under any Facility LC issued
by it complied with the terms of such Facility LC or (ii) the applicable LC
Issuer's failure (other than pursuant to legal process) to pay under any
Facility LC issued by it after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. All such amounts
paid by the applicable LC Issuer and remaining unpaid by the Borrower shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to (x) the rate applicable to Floating Rate
42
50
FINAL EXECUTION COPY
Advances for such day if such day falls on or before the applicable LC Payment
Date and (y) the sum of 2% PLUS the rate applicable to Floating Rate Advances
for such day if such day falls after such LC Payment Date. Each LC Issuer will
pay to each Lender ratably in accordance with its Revolving Loan Percentage all
amounts received by it from the Borrower for application in payment, in whole
or in part, of the Reimbursement Obligation in respect of any Facility LC
issued by such LC Issuer, but only to the extent such Lender has made payment
to such LC Issuer in respect of such Facility LC pursuant to subsection (e).
Subject to the terms and conditions of this Agreement (including without
limitation the submission of an applicable Borrowing Notice and the
satisfaction of the applicable conditions precedent set forth in ARTICLE IV),
the Borrower may request Revolving Loans or Swing Loans hereunder for the
purpose of satisfying any Reimbursement Obligation.
(g) The Borrower's obligations under this SECTION 2.19 shall be
absolute and unconditional under any and all circumstances and irrespective of
any setoff, counterclaim or defense to payment which the Borrower may have or
have had against any LC Issuer, any Lender or any beneficiary of a Facility LC.
The Borrower further agrees with each of the LC Issuers and the Lenders that
the LC Issuers and the Lenders shall not be responsible for, and the Borrower's
Reimbursement Obligation in respect of any Facility LC shall not be affected
by, among other things, the validity or genuineness of documents or of any
endorsements thereon, even if the L/C Issuer shall have been informed by the
Borrower that the Borrower believes such documents to be or such documents
should in fact prove to be in any or all respects invalid, fraudulent or
forged, or any dispute between or among the Borrower, any of its Subsidiaries,
the beneficiary of any Facility LC or any financial institution or other party
to whom any Facility LC may be transferred or any claims or defenses whatsoever
of the Borrower or of any of its Subsidiaries against the beneficiary of any
Facility LC or any such transferee provided any drawing under such a Facility
LC conforms in all material respects on its face to the requirements of such
Facility LC. No LC Issuer shall be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Facility LC. The Borrower
agrees that any action taken or omitted by any LC Issuer or any Lender under or
in connection with each Facility LC and the related drafts and documents, if
done in good faith and without Gross Negligence, shall be binding upon the
Borrower and shall not put the applicable LC Issuer or any Lender under any
liability to the Borrower.
(h) To the extent not inconsistent with subsection (g) above, the
applicable LC Issuer shall be entitled to rely, and shall be fully protected in
relying upon, any Facility LC, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by such LC Issuer. The applicable LC
Issuer shall be fully justified in failing or refusing to take any action under
this Agreement unless it shall first have received such advice or concurrence
of the Required Lenders or all of the Lenders (as applicable under SECTION 8.2)
as it reasonably deems appropriate or it shall first be indemnified to its
reasonable satisfaction (which shall not include any requirement that it be
indemnified for its willful misconduct or Gross Negligence) by the Lenders
against any and all
43
51
FINAL EXECUTION COPY
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Notwithstanding any other provision of
this SECTION 2.19, each LC Issuer shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement in accordance with a
request of the Required Lenders or all of the Lenders (as applicable under
SECTION 8.2), and such request and any action taken or failure to act pursuant
thereto shall be binding upon the Lenders and all future holders of
participations in any Facility LCs.
(i) The Borrower hereby agrees to indemnify and hold harmless each
Lender, each Swing Loan Lender, each LC Issuer, each Co-Arranger and the
Administrative Agent, and their respective directors, officers, agents and
employees, from and against any and all claims and damages, losses,
liabilities, costs or expenses which such Lender, Swing Loan Lender, LC Issuer,
Co-Arranger or Administrative Agent may incur (or which may be claimed against
such Lender, Swing Loan Lender, LC Issuer, Co-Arranger or Administrative Agent
by any Person whatsoever) by reason of or in connection with the execution and
delivery or transfer of or payment or failure to pay under any Facility LC or
any actual or proposed use of any Facility LC, including, without limitation,
any claims, damages, losses, liabilities, costs or expenses which the
applicable LC Issuer may incur by reason of or in connection with (i) the
failure of any other Lender to fulfill or comply with its obligations to such
LC Issuer hereunder (but nothing herein contained shall affect any rights the
Borrower may have against any defaulting Lender) or (ii) by reason of or on
account of such LC Issuer issuing any Facility LC which specifies that the term
"Beneficiary" included therein includes any successor by operation of law of
the named Beneficiary, but which Facility LC does not require that any drawing
by any such successor Beneficiary be accompanied by a copy of a legal document,
satisfactory to such LC Issuer, evidencing the appointment of such successor
Beneficiary; PROVIDED that the Borrower shall not be required to indemnify any
Lender, Swing Loan Lender, LC Issuer, Co-Arranger or Administrative Agent for
any claims, damages, losses, liabilities, costs or expenses to the extent, but
only to the extent, caused by (i) the willful misconduct or Gross Negligence of
the applicable LC Issuer in determining whether a request presented under any
Facility LC complied with the terms of such Facility LC or (ii) the applicable
LC Issuer's failure to pay under any Facility LC after the presentation to it
of a request strictly complying with the terms and conditions of such Facility
LC. Nothing in this subsection (i) is intended to limit the obligations of the
Borrower under any other provision of this Agreement.
(j) Each Lender shall, ratably in accordance with its Revolving Loan
Percentage, indemnify each LC Issuer, its affiliates and their respective
officers, directors, employees, partners, managers, shareholders, attorneys and
agents (to the extent not reimbursed by the Borrower) against any cost, expense
(including reasonable counsel fees and disbursements), claim, demand, action,
loss or liability (except such as result from such indemnitees' Gross
Negligence or willful misconduct or such LC Issuer's failure (other than
pursuant to legal process) to pay under any Facility LC after the presentation
to it of a request strictly complying with the terms and conditions of such
Facility LC) that such indemnitees may suffer or incur in connection with this
SECTION 2.19 or any action taken or omitted by such indemnitees hereunder.
44
52
FINAL EXECUTION COPY
(k) In its capacity as a Lender, each LC Issuer shall have the same
rights and obligations as any other Lender.
ARTICLE III: CHANGE IN CIRCUMSTANCES
------------------------------------
3.1. YIELD PROTECTION. If any law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law, provided compliance therewith is customary
practice if not having the force of law), or any interpretation thereof, or the
compliance of any Lender, Swing Loan Lender or LC Issuer therewith,
(i) subjects any Lender, Swing Loan Lender or LC Issuer
or any applicable Lending Installation to any tax,
duty, charge or withholding on or from payments due
from the Borrower (excluding taxes (including income
taxes, franchise taxes and branch profit taxes) as
are imposed on or measured by such Lender's, Swing
Loan Lender's or LC Issuer's, as the case may be,
income by the United States of America or any
Governmental Authority of the jurisdiction under the
laws of which such Lender, Swing Loan Lender or LC
Issuer, as the case may be, is organized or maintains
its Lending Installation), or changes the basis of
taxation of payments to any Lender, Swing Loan Lender
or LC Issuer in respect of its Loans, Facility LCs or
other amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or
similar requirement against assets of, deposits with
or for the account of, or credit extended by, any
Lender, Swing Loan Lender or LC Issuer or any
applicable Lending Installation (other than reserves
and assessments taken into account in determining the
interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition,
in each case, the result of which is to increase the cost to any Lender, Swing
Loan Lender or LC Issuer or any applicable Lending Installation of making,
funding, issuing or maintaining Loans or Facility LCs or reduces any amount
receivable by any Lender, Swing Loan Lender or LC Issuer or any applicable
Lending Installation in connection with Loans or Facility LCs, or requires any
Lender, Swing Loan Lender or LC Issuer or any applicable Lending Installation
to make any payment calculated by reference to the amount of Loans held,
Facility LCs issued or interest or fees received by it, by an amount deemed
material by such Lender, Swing Loan Lender or LC Issuer, then, within 15 days
of demand by such Lender, Swing Loan Lender or LC Issuer, the Borrower shall
pay to the Administrative Agent for the account of such Lender, Swing Loan
Lender or LC Issuer that portion of such increased expense incurred or
reduction in an amount received which such
45
53
FINAL EXECUTION COPY
Lender, Swing Loan Lender or LC Issuer determines is reasonably attributable to
making, funding, issuing and maintaining its Loans, Facility LCs or Revolving
Loan Commitment.
3.2. CHANGES IN CAPITAL ADEQUACY REGULATIONS. If a Lender, Swing Loan
Lender or LC Issuer determines the amount of capital required or expected to be
maintained by such Lender, Swing Loan Lender or LC Issuer, any Lending
Installation of such Lender, Swing Loan Lender or LC Issuer or any corporation
controlling such Lender, Swing Loan Lender or LC Issuer is increased as a result
of a Change, then, within 15 days of demand by such Lender, Swing Loan Lender or
LC Issuer (a copy of which demand shall be sent to the Administrative Agent),
the Borrower shall pay to the Administrative Agent for the account of such
Lender, Swing Loan Lender or LC Issuer the amount necessary to compensate for
any shortfall in the rate of return on the portion of such increased capital
which such Lender, Swing Loan Lender or LC Issuer reasonably determines is
attributable to this Agreement, its Outstanding Credit Exposure or its Revolving
Loan Commitment (after taking into account such Lender's, Swing Loan Lender's or
LC Issuer's policies as to capital adequacy). "CHANGE" means (i) any change
after the date of this Agreement in the Risk-Based Capital Guidelines or (ii)
any adoption of or change in any other law or governmental or quasi-governmental
rule, regulation, policy, guideline, interpretation, or directive (whether or
not having the force of law, provided compliance therewith is customary practice
if not having the force of law) after the date of this Agreement which affects
the amount of capital required or expected to be maintained by any Lender, Swing
Loan Lender or LC Issuer or any Lending Installation or any corporation
controlling any Lender, Swing Loan Lender or LC Issuer. "RISK-BASED CAPITAL
GUIDELINES" means (i) the risk-based capital guidelines in effect in the United
States on the date of this Agreement, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this Agreement.
Each Lender agrees promptly to notify Borrower and the Administrative Agent of
any circumstances that would cause Borrower to pay additional amounts pursuant
to this SECTION 3.2, PROVIDED that the failure to give such notice shall not
affect Borrower's obligation to pay such additional amounts hereunder.
3.3. AVAILABILITY OF TYPES OF ADVANCES. If any Lender reasonably
determines that maintenance of any of its Eurodollar Loans at a suitable
Lending Installation would violate any applicable law, rule, regulation or
directive, whether or not having the force of law, then the Administrative
Agent shall suspend the availability of Eurodollar Advances and require any and
all outstanding Eurodollar Advances to be repaid. If the Required Lenders
determine that (i) deposits of a type or maturity appropriate to match fund
Eurodollar Advances are not available or (ii) the interest rate applicable to
any Eurodollar Advance does not accurately reflect the cost of making
Eurodollar Advances, then the Administrative Agent shall suspend the
availability of Eurodollar Advances.
46
54
FINAL EXECUTION COPY
3.4. FUNDING INDEMNIFICATION. If any payment of a Eurodollar Advance
or a Swing Loan occurs on a date which is not the last day of the applicable
Eurodollar Interest Period or maturity date, whether because of acceleration,
prepayment or otherwise, or a Eurodollar Advance or Swing Loan is not made or
prepaid on the date specified by the Borrower for any reason other than default
by the Lenders or applicable Swing Loan Lenders, or a Eurodollar Advance is not
continued in accordance with the terms hereof, or a Floating Rate Advance is
not converted to a Eurodollar Advance in accordance with the terms hereof, the
Borrower will indemnify each Lender or Swing Loan Lender, as applicable for any
loss or cost incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Advance or Swing Loan. In connection with any assignment by the
Co-Arrangers of any portion of the Obligations made pursuant to SECTION 12.3
and made prior to completion of the General Syndication, the Borrower shall be
deemed to have repaid all outstanding Eurodollar Advances as of such date and
reborrowed such amount as a Floating Rate Advance and/or Eurodollar Advance
(chosen in accordance with the provisions of SECTION 2.8) and the
indemnification provisions under this SECTION 3.4 shall apply.
3.5. LENDER STATEMENTS; SURVIVAL OF INDEMNITY. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of
the Borrower to such Lender under SECTIONS 3.1 and 3.2 or to avoid the
unavailability of a Type of Advance under SECTION 3.3, so long as such
designation is not disadvantageous to such Lender in its reasonable
determination. In determining the amounts payable under SECTIONS 3.1 and 3.2,
each Lender shall use its reasonable efforts to make its allocations and
computations, to the extent readily determinable, consistent with the
allocations and computations applied generally by such Lender to other
customers of similar size and credit quality and under similar circumstances.
Each Lender, LC Issuer or Swing Loan Lender shall deliver a written statement
of such Lender, LC Issuer or Swing Loan Lender, as applicable to the Borrower
and the Administrative Agent as to the amount due, if any, under SECTIONS 3.1,
3.2 or 3.4. Such written statement shall set forth in reasonable detail the
calculations upon which such Lender, LC Issuer or Swing Loan Lender determined
such amount and shall be final, conclusive and binding on the Borrower in the
absence of manifest error. Determination of amounts payable under such
Sections in connection with a Eurodollar Loan or Swing Loan shall be calculated
as though each Lender or Swing Loan Lender funded its Eurodollar Loan or Swing
Loan through the purchase of a deposit of the type and maturity corresponding
to the deposit used as a reference in determining the Eurodollar Rate or Money
Market Rate applicable to such Loan, whether in fact that is the case or not.
Unless otherwise provided herein, the amount specified in the written statement
shall be payable on demand after receipt by the Borrower of the written
statement. The obligations of the Borrower under SECTIONS 3.1, 3.2 and 3.4
shall survive payment of the Obligations and termination of this Agreement.
3.6. REPLACEMENT LENDERS. If any Lender either makes a demand for
compensation pursuant to SECTION 2.19(f), SECTION 3.1 or SECTION 3.2, or is
unable to fund at the Eurodollar Rate or determines that such rate is
unavailable or does not accurately reflect its cost of making or maintaining
any Eurodollar Loan pursuant to SECTION 3.3, the Borrower may require and have
such
47
55
FINAL EXECUTION COPY
Lender transfer, pursuant to and in accordance with SECTION 12.3, all of its
rights and obligations under the Credit Documents to one or more Purchasers
selected by the Borrower, reasonably acceptable to the Administrative Agent,
the Swing Loan Lenders and the LC Issuers, and willing to accept such
assignment. No such assignment shall affect (a) any liability or obligation of
the Borrower or any other Lender to such replaced Lender, which accrued on or
prior to the date of such assignment or (b) such replaced Lender's rights or
obligations hereunder in respect of any such liability or obligation. No such
assignment shall impose upon the replaced Lender any obligation to pay all or
any portion of the processing fee required under SECTION 12.3.2, which
processing fee shall be paid by the Borrower and/or the replacement Lender. No
such assignment shall be effective without the payment by the replacement
Lender and/or the Borrower to the Lender being replaced of all Obligations
(other than contingent indemnity obligations) of the Borrower to the Lender at
such time.
ARTICLE IV: CONDITIONS PRECEDENT
--------------------------------
4.1. INITIAL CREDIT EXTENSION. The Lenders shall not be required to
make the Term Loans or initial Revolving Loans hereunder, the LC Issuers shall
not be required to issue the initial Facility LC hereunder and the Swing Loan
Lenders shall not be required to make any Swing Loans hereunder, unless (i)
such initial Loans are made not later than January 31, 1996; (ii) the
Marshalls Acquisition has been consummated (other than the payment of the cash
portion of the purchase price from the Loans to be made hereunder); (iii) all
fees and expenses payable to the Administrative Agent and the Co-Arrangers
required to be paid as of such date have been paid; and (iv) the Borrower has
furnished to the Administrative Agent:
(a) Copies of the articles or certificate of incorporation of each
of the Borrower and the Facility Guarantors, together with all
amendments, and a certificate of good standing, in each case
certified not earlier than 15 Business Days prior to the
initial Credit Extension Date by the appropriate governmental
officer in its jurisdiction of incorporation.
(b) Copies, certified by the Secretary or Assistant Secretary of
each of the Borrower and the Facility Guarantors, of its
by-laws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are reasonably deemed
necessary by counsel for the Administrative Agent, the
Co-Arrangers or any Lender) authorizing the execution,
delivery and performance of the Credit Documents.
(c) An incumbency certificate, executed by the Secretary or
Assistant Secretary of each of the Borrower and the Facility
Guarantors (the signature of which Secretary or Assistant
Secretary shall be independently certified by another officer
of the applicable Person), which shall identify by name and
title and bear the signature of the officers of the Borrower
and the Facility Guarantors authorized to sign the Credit
Documents and, with respect to the Borrower, to request the
making of Credit
48
56
FINAL EXECUTION COPY
Extensions hereunder, upon which certificate the
Administrative Agent, each Co-Arranger, each Swing Loan
Lender, each LC Issuer and the Lenders shall be entitled to
rely until informed of any change in writing by the Borrower
or Facility Guarantor, as applicable.
(d) A certificate, signed by the Chief Financial Officer or
Treasurer of the Borrower, stating that on the initial Credit
Extension Date no Default or Unmatured Default has occurred
and is continuing.
(e) Written opinions of Ropes & ▇▇▇▇, legal counsel to the
Borrower and the Facility Guarantors, local counsel to the
Borrower and the Facility Guarantors, and ▇▇▇ ▇▇▇▇▇▇▇, Senior
Vice President and General Counsel to the Borrower in each
case addressed to the Administrative Agent, the Co-Arrangers
and the Lenders in form and substance reasonably acceptable to
the Administrative Agent, the Co-Arrangers, the Lenders and
their counsel (with the issues covered by the opinion of ▇▇▇
▇▇▇▇▇▇▇ to be reasonably acceptable to counsel for the
Administrative Agent, the Co-Arrangers or any Lender).
(f) Revolving Notes and Term Notes payable to the order of each of
the Lenders.
(g) Written money transfer instructions, in substantially the form
of EXHIBIT "D" hereto, addressed to the Administrative Agent
and signed by an Authorized Officer, together with such other
related money transfer authorizations as the Administrative
Agent may have reasonably requested.
(h) The other documents, instruments, agreements, opinions and
certificates as set forth on the list of closing documents
attached as EXHIBIT "B" hereto.
(i) A certificate of the Chief Financial Officer or Treasurer of
the Borrower (together with supporting documentation
reasonably satisfactory to the Administrative Agent and the
Co-Arrangers and their counsel) that, concurrently with the
Borrower's receipt of the initial Advance hereunder: (1) the
entire principal amount (together with accrued interest and
premium, if any) of the Prepayment Indebtedness shall be
repaid in full and (2) any and all documents, instruments and
agreements executed in connection therewith, including,
without limitation the Guaranty Agreement dated as of December
30, 1994 and executed by the Borrower, have been terminated
and are of no further force and effect.
(j) A certificate of the Chief Financial Officer or Treasurer of
the Borrower (together with supporting documentation
reasonably satisfactory to the Administrative Agent and the
Co-Arrangers and their counsel) that, concurrently with the
Borrower's receipt of the initial Advance hereunder: (1) the
entire principal amount (together with accrued interest and
premium, if any) of all outstanding loans under all
49
57
FINAL EXECUTION COPY
outstanding domestic committed credit facilities between the
Borrower or any of its Subsidiaries with any of the
Co-Arrangers or Lenders party to this Agreement shall be or
have been repaid in full and (2) any and all documents,
instruments and agreements executed in connection therewith,
including, without limitation, line letter agreements, have
been terminated and are of no further force and effect.
(k) Evidence satisfactory to the Administrative Agent, the
Co-Arrangers and their counsel that all of the conditions
precedent set forth in that certain commitment letter dated as
of October 14, 1995 issued by the Co-Arrangers to the Borrower
and accepted by the Borrower have been satisfied.
(l) Such other documents as the Administrative Agent, any
Co-Arranger or any other Lender or its counsel may have
reasonably requested.
4.2. EACH CREDIT EXTENSION. The Lenders shall not be required to make
any Advance (other than an Advance that, after giving effect thereto and to the
application of the proceeds thereof, does not increase the aggregate amount of
outstanding Advances), the Swing Loan Lenders shall not be required to make any
Swing Loan, and the LC Issuers shall not be required to issue any Facility LC
or effect any Modification thereof, unless on the applicable Credit Extension
Date, both immediately prior to, and immediately after giving effect to, such
Credit Extension and the use of proceeds in connection therewith:
(a) Either (i) in the case of an Advance, the Administrative Agent
shall have received a Borrowing Notice in compliance with
SECTION 2.8, (ii) in the case of a Swing Loan, the
Administrative Agent and applicable Swing Loan Lender(s) shall
have received a request for the making of a Swing Loan in
compliance with SECTION 2.2.2 or (iii) in the case of a
Facility LC, the LC Issuer shall have received a request for
the issuance or Modification of a Facility LC in compliance
with SECTION 2.19 (together with any Facility LC Application
Agreement requested by the applicable LC Issuer pursuant to
SECTION 2.19(c)).
(b) The Aggregate Revolving Credit Obligations do not and would
not exceed the Aggregate Revolving Loan Commitment.
(c) There exists no Default or Unmatured Default.
(d) The representations and warranties contained in ARTICLE V and
in each Facility Guaranty are true and correct as of such
Credit Extension Date except to the extent any such
representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty
shall be true and correct on and as of such earlier date.
50
58
FINAL EXECUTION COPY
(e) All legal matters incident to the making of such Credit
Extension shall be reasonably satisfactory to the Lenders and
their counsel.
Each Borrowing Notice with respect to each such Advance, each request
for a Swing Loan and each request for the issuance or Modification of a
Facility LC shall constitute a representation and warranty by the Borrower that
the conditions contained in SECTIONS 4.2(b), (c), and (d) have been satisfied.
ARTICLE V: REPRESENTATIONS AND WARRANTIES
-----------------------------------------
In order to induce the Administrative Agent, the Co-Arrangers, the LC
Issuers, the Swing Loan Lenders and the Lenders to enter into this Agreement
and to make the Loans and the other financial accommodations to the Borrower
and to issue the Facility LCs described herein, the Borrower represents and
warrants to the Administrative Agent, each Co-Arranger, each LC Issuer, each
Swing Loan Lender and each Lender as follows as of the date of this Agreement,
the initial Credit Extension Date and thereafter on each date as required by
SECTION 4.2 that:
5.1. CORPORATE EXISTENCE AND STANDING. Each of the Borrower and the
Facility Guarantors (i) is a corporation duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, (ii)
is duly qualified to do business as a foreign corporation and is in good
standing under the laws of each jurisdiction in which it owns or leases real
property or in which the nature of its business requires it to be so qualified,
except those jurisdictions where the failure to be in good standing or to so
qualify could not have a Material Adverse Effect, and (iii) has all requisite
corporate power and authority to own, lease and operate its property and assets
and to conduct its business as presently conducted and as proposed to be
conducted in connection with and following the consummation of the transactions
contemplated by the Transaction Documents.
5.2. AUTHORIZATION AND VALIDITY.
(A) Each of the Borrower and its Subsidiaries has the requisite
corporate power and authority (i) to execute, deliver and perform each of the
Transaction Documents which are to be executed by it in connection with the
Marshalls Acquisition or which have been executed by it as required by this
Agreement and (ii) to file the Transaction Documents which must be filed by it
in connection with the Marshalls Acquisition or which have been filed by it in
connection with this Agreement with any Governmental Authority.
(B) The execution, delivery, performance and filing, as the case may
be, of each of the Transaction Documents executed or filed by the Borrower or
any of its Subsidiaries in connection with the Marshalls Acquisition and to
which the Borrower or any of its Subsidiaries is a party, and the consummation
of the transactions contemplated thereby, have been duly approved by the
respective boards of directors and, if necessary, the shareholders of the
Borrower and its
51
59
FINAL EXECUTION COPY
Subsidiaries, and such approvals have not been rescinded. No other corporate
action or proceedings on the part of the Borrower or its Subsidiaries are
necessary to consummate such transactions. The execution, delivery,
performance and filing, as the case may be, of each of the Transaction
Documents executed or filed by the Seller or any of its Subsidiaries in
connection with the Marshalls Acquisition on or prior to the date of the
initial Credit Extension and to which the Seller or any of its Subsidiaries is
a party, and the consummation of the transactions contemplated thereby, have
been duly approved by the respective boards of directors and, if necessary, the
shareholders of the Seller and its Subsidiaries, and such approvals have not
been rescinded.
(C) Each of the Transaction Documents to which the Borrower or any of
its Subsidiaries is a party has been duly executed, delivered or filed, as the
case may be, by it and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms (except as enforceability
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditor's rights generally), is in full force and effect and no
material term or condition thereof has been amended, modified or waived without
the prior written consent of the Required Lenders (or all of the Lenders if so
required under SECTION 8.2), and the Borrower and its Subsidiaries have
performed and complied with all the terms, provisions, agreements and
conditions set forth therein and required to be performed or complied with by
such parties and no unmatured default, default or breach of any covenant by any
such party exists thereunder. As of the date of the initial Credit Extension,
to the best of the Borrower's and its Subsidiaries' knowledge, all parties
(other than the Borrower and its Subsidiaries) have performed and complied with
all the terms, provisions, agreements and conditions set forth in the
Transaction Documents and required to be performed or complied with by such
parties and no unmatured default, default or breach of any covenant by any such
party exists thereunder.
5.3. NO CONFLICT; GOVERNMENT CONSENT. Neither the execution and
delivery by the Borrower or any of its Subsidiaries of the Transaction
Documents, nor the consummation of the transactions therein contemplated, nor
compliance with the provisions thereof will violate any law, rule, regulation,
order, writ, judgment, injunction, decree or award binding on the Borrower or
any of its Subsidiaries or the Borrower's or any Subsidiary's articles of
incorporation or by-laws or the provisions of any indenture, instrument or
agreement to which the Borrower or any of its Subsidiaries is a party or is
subject, or by which it, or its Property, is bound, or conflict with or
constitute a default thereunder, or result in the creation or imposition of any
Lien in, of or on the Property of the Borrower or a Subsidiary pursuant to the
terms of any such indenture, instrument or agreement. No order, consent,
approval, license, authorization or validation of, or filing, recording or
registration with, or exemption by, any Governmental Authority is required to
authorize, or is required in connection with the execution, delivery and
performance of, or the legality, validity, binding effect or enforceability of,
any of the Transaction Documents, except (i) such as have been made or obtained
as set forth on SCHEDULE 5.3 or (ii) such as set forth on SCHEDULE 5.3 hereto
which have not been obtained or made and which are immaterial.
52
60
FINAL EXECUTION COPY
5.4. FINANCIAL STATEMENTS.
(A) The PRO FORMA financial statements of the Borrower and its
Subsidiaries, copies of which are contained in the Information Memorandum,
present on a PRO FORMA basis the financial condition of the Borrower and such
Subsidiaries as of such date, and reflect on a PRO FORMA basis those
liabilities reflected in the notes thereto and resulting from consummation of
the Marshalls Acquisition and the transactions contemplated by this Agreement
and the other Transaction Documents, and the payment or accrual of all
Transaction Costs payable on or prior to the date of the initial Credit
Extension with respect to any of the foregoing. The projections and
assumptions expressed in the PRO FORMA financials referenced in this SECTION
5.4(A) were prepared in good faith and represent management's opinion based on
the information available to the Borrower at the time so furnished.
(B) The January 28, 1995 audited and July 29, 1995 unaudited
consolidated financial statements of the Borrower and its Subsidiaries
heretofore delivered to the Administrative Agent and the Lenders were prepared
in accordance with generally accepted accounting principles in effect on the
respective dates such statements were prepared and fairly present in all
material respects the consolidated financial condition and operations of the
Borrower and its Subsidiaries at such dates and the consolidated results of
their operations for the respective periods then ended. The financial
information contained in the Information Memorandum with respect to Marshalls
and its Subsidiaries heretofore delivered to the Administrative Agent and the
Lenders, when taken as a whole, fairly presents in all material respects the
financial condition and operations of Marshalls and its Subsidiaries at the
dates indicated therein and the consolidated results of their operations for
the respective periods then ended (taking into account for such periods the
effects of any subsequent charges or projected charges reflected in the
financial information and projections contained in the Information Memorandum);
provided, nothing herein shall constitute a representation that such financial
information was prepared in accordance with generally accepted accounting
principles.
5.5. MATERIAL ADVERSE CHANGE. As of the date of this Agreement and as
of the initial Credit Extension Date, since January 28, 1995 with respect to
Borrower and its Subsidiaries and since October 31, 1995 with respect to
Marshalls and its Subsidiaries there has been no material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower and its Subsidiaries, taken as a whole
or Marshalls and its Subsidiaries, taken as a whole.
5.6. TAXES. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith, as to which adequate
reserves have been provided in accordance with Agreement Accounting Principles
and as to which no tax lien has been filed. The United States income tax
returns of the Borrower and its Subsidiaries have been audited
53
61
FINAL EXECUTION COPY
by the Internal Revenue Service through the fiscal year ended January 25, 1992.
No tax liens have been filed and, except as set forth on SCHEDULE 5.6 hereto,
no written claims are being made and no other claims are, to the knowledge of
the executive officers of the Borrower, asserted with respect to any such
taxes. The charges, accruals and reserves on the books of the Borrower and its
Subsidiaries in respect of any taxes or other governmental charges have been
established in accordance with Agreement Accounting Principles and, to the
knowledge of the executive officers of the Borrower, are adequate.
5.7. LITIGATION AND CONTINGENT OBLIGATIONS. Except as set forth on
SCHEDULE 5.7 hereto, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their executive officers, threatened against or affecting the Borrower or any
of its Subsidiaries which, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect or subject the Borrower and its
Subsidiaries to liability, individually or in the aggregate, in excess of
$25,000,000 (in each case determined after giving effect to claims which the
Borrower has demonstrated to the reasonable satisfaction of the Administrative
Agent are covered by applicable third-party insurance policies (other than
retro- premium insurance or other policies with similar self-insurance
attributes) of the Borrower or any of its Subsidiaries unless the insurers of
such claims have disclaimed coverage or reserved the right to disclaim
coverage). Other than any liability incident to such litigation, arbitration
or proceedings, the Borrower and its Subsidiaries have no material contingent
obligations not provided for or disclosed in the financial statements referred
to in SECTION 5.4.
5.8. SUBSIDIARIES. SCHEDULE 5.8 hereto contains an accurate list of
all of the presently existing Subsidiaries of the Borrower (taking into effect
the consummation of the Marshalls Acquisition), setting forth their respective
jurisdictions of incorporation and the percentage of their respective capital
stock owned by the Borrower or other Subsidiaries. All of the issued and
outstanding shares of capital stock of such Subsidiaries have been duly
authorized and issued and are fully paid and non-assessable.
5.9. ERISA. The Unfunded Liabilities of all Single Employer Plans do
not in the aggregate exceed $25,000,000. Neither the Borrower nor any other
member of the Controlled Group has failed to make any required installment or
any other required payment under Section 412 of the Code on or before the due
date for such installment or other payment with respect to a Single Employer
Plan, or has failed to make a required contribution or payment to a
Multiemployer Plan. Neither the Borrower nor any other member of the
Controlled Group has any potential liability, whether direct or indirect,
contingent or otherwise, under Section 4069, 4204 or 4212(c) of ERISA. Each
Plan complies in all material respects with all applicable requirements of law
and regulations and has been administered in all material respects in
accordance with its terms. No Reportable Event has occurred with respect to
any Plan, neither the Borrower nor any other member of the Controlled Group has
withdrawn from any Plan or initiated steps to do so, no steps have been taken
to reorganize or terminate any Plan, no event has occurred which imposes an
obligation on the Borrower or any
54
62
FINAL EXECUTION COPY
member of the Controlled Group under Section 4041 of ERISA to provide affected
parties written notice of intent to terminate a Plan in a distress termination
described in Section 4041(c) of ERISA; no event or condition has occurred which
might constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan, in any such case where
such event could reasonably be expected to have a Material Adverse Effect or
subject the Borrower or its Subsidiaries to liability, individually or in the
aggregate with all other Reportable Events or other such events in excess of
$10,000,000 at any one time.
5.10. ACCURACY OF INFORMATION. The Information Memorandum taken as a
whole does not contain any material misstatement of fact or omit to state a
material fact or any fact necessary to make the statements contained therein
not misleading; provided, nothing herein shall constitute a representation that
any financial information with respect to Marshalls and its Subsidiaries was
prepared in accordance with generally accepted accounting principles. No other
written information, exhibit or report furnished by the Borrower or any of its
Subsidiaries to the Administrative Agent or the Lenders contained any material
misstatement of fact or omitted to state a material fact or any fact necessary
to make the statements contained therein not misleading.
5.11. REGULATIONS G, T, U AND X. Margin stock (as defined in
Regulation U) constitutes less than 25% of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder. Neither the Borrower nor any of its Subsidiaries is
engaged in the business of purchasing or carrying Margin Stock.
5.12. MATERIAL AGREEMENTS. Neither the Borrower nor any Subsidiary is
a party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Material Indebtedness.
5.13. COMPLIANCE WITH LAWS. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any Governmental Authority having jurisdiction over the conduct
of their respective businesses or the ownership of their respective Property
except where the failure to so comply could not reasonably be expected to
result in a Material Adverse Effect or subject the Borrower and its
Subsidiaries to liability, individually or in the aggregate, in excess of
$25,000,000 (determined after giving effect to claims which the Borrower has
demonstrated to the reasonable satisfaction of the Administrative Agent are
covered by applicable third-party insurance policies (other than retro-premium
insurance or other policies with similar self-insurance attributes) of the
Borrower or any of its Subsidiaries unless the insurers of such claims have
disclaimed coverage or reserved the right to disclaim coverage). Except as set
forth in SCHEDULE 5.13 hereto, neither the Borrower nor any Subsidiary has
received any notice to the effect
55
63
FINAL EXECUTION COPY
that its operations are not in material compliance with any Environmental,
Health or Safety Requirements of Law or the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
release of any petroleum, toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could reasonably be
expected to have a Material Adverse Effect or could reasonably be expected to
subject the Borrower or its Subsidiaries to liability, individually, or in the
aggregate, in excess of $10,000,000 (determined after giving effect to claims
which the Borrower has demonstrated to the reasonable satisfaction of the
Administrative Agent are covered by applicable third-party insurance policies
(other than retro- premium insurance or other policies with similar
self-insurance attributes) of the Borrower or any of its Subsidiaries unless
the insurers of such claims have disclaimed coverage or reserved the right to
disclaim coverage).
5.14. OWNERSHIP OF PROPERTY. Except as set forth on SCHEDULE 5.14
hereto, on the date of this Agreement, the Borrower and its Subsidiaries have
good title, free of all Liens other than those permitted by SECTION 6.17, to
all of the Property and assets reflected in the financial statements referred
to in SECTION 5.4 as owned by it. The Borrower and each of its Subsidiaries
owns (or is licensed to use) all Intellectual Property which is necessary or
appropriate in any material respect for the conduct of its respective business
as conducted on the date of this Agreement, without any material conflict with
the rights of any other Person. Neither the Borrower nor any Subsidiary is
aware of (i) any material existing or threatened infringement or
misappropriation of any of its Intellectual Property by any third party or (ii)
any material third party claim that any aspect of the business of the Borrower
or any Subsidiary (as conducted on the date of this Agreement) infringes or
will infringe upon, any Intellectual Property or other property right of any
other Person, in each case that could reasonably be expected to have a Material
Adverse Effect or could reasonably be expected to subject the Borrower or its
Subsidiaries to liability, individually, or in the aggregate, in excess of
$10,000,000 (in each case, determined after giving effect to claims which the
Borrower has demonstrated to the reasonable satisfaction of the Administrative
Agent are covered by applicable third-party insurance policies (other than
retro-premium insurance or other policies with similar self-insurance
attributes) of the Borrower or any of its Subsidiaries unless the insurers of
such claims have disclaimed coverage or reserved the right to disclaim
coverage).
5.15. LABOR MATTERS. There are no labor controversies pending or, to
the best of the Borrower's and its Subsidiaries' knowledge, threatened against
the Borrower or any Subsidiary, which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect. The Borrower and
each of its Subsidiaries are in substantial compliance in all material respects
with the Fair Labor Standards Act, as amended.
5.16. INVESTMENT COMPANY ACT. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
56
64
FINAL EXECUTION COPY
5.17. PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Borrower nor
any Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
5.18. THE MARSHALLS ACQUISITION. As of the date of the initial Credit
Extension and immediately prior to the making of the initial Loans:
(i) the Acquisition Documents are in full force and effect, no
material breach, default or waiver of any term or provision of
any of the Acquisition Documents by the Borrower or any of its
Subsidiaries or, to the best of the Borrower's knowledge, the
other parties thereto has occurred (except for such breaches,
defaults and waivers, if any, consented to in writing by the
Required Lenders) and no action has been taken by any
competent Governmental Authority which restrains, prevents or
imposes any material adverse condition upon, or seeks to
restrain, prevent or impose any material adverse condition
upon, the Marshalls Acquisition;
(ii) the representations and warranties of each of the Borrower and
the Borrower's Subsidiaries contained in the Acquisition
Documents, if any, are true and correct in all material
respects; and
(iii) all conditions precedent to, and all consents necessary to
permit, the Marshalls Acquisition pursuant to the Acquisition
Documents have been satisfied or waived with the prior written
consent of the Administrative Agent and the Required Lenders,
and the Marshalls Acquisition has been consummated in
accordance with the Acquisition Documents and the Borrower has
obtained good and marketable title to all of the outstanding
capital stock of Marshalls free and clear of any Liens.
57
65
FINAL EXECUTION COPY
ARTICLE VI: COVENANTS
---------------------
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. FINANCIAL REPORTING. The Borrower will maintain, for itself and
its Subsidiaries, a system of accounting established and administered in
accordance with Agreement Accounting Principles, and furnish to the Lenders:
(i) As soon as practicable but in any event within 105 days after
the close of each of its fiscal years, an audit report (which
audit report shall be unqualified or shall be otherwise
reasonably acceptable to the Required Lenders; PROVIDED that
such report may set forth qualifications to the extent such
qualifications pertain solely to changes in generally accepted
accounting principles from the Agreement Accounting Principles
applied during earlier accounting periods, the implementation
of which changes (with the concurrence of such accountants) is
reflected in the financial statements accompanying such
report), certified by independent certified public
accountants who are reasonably acceptable to the Required
Lenders, prepared in accordance with Agreement Accounting
Principles on a consolidated and consolidating divisional
basis (consolidating divisional statements need not be
certified by such accountants and need be prepared only
consistently with the past practices of the Borrower with
respect to the preparation of its divisional statements) for
itself and its Subsidiaries, including balance sheets as of
the end of such period and the related statements of income,
and consolidated stockholder's equity and cash flows,
accompanied by a certificate of said accountants that, in the
course of their examination necessary for their certification
of the foregoing, they have obtained no knowledge of any
Default or Unmatured Default, or if, in the opinion of such
accountants, any Default or Unmatured Default shall exist,
stating the nature and status thereof.
(ii) As soon as practicable but in any event within 60 days after
the close of each of the first three quarterly periods of each
of its fiscal years, for itself and its Subsidiaries on a
consolidated and consolidating divisional basis (consolidating
divisional statements need be prepared only consistently with
the past practices of the Borrower with respect to the
preparation of its divisional statements) balance sheets as of
the end of such period and the related statements of income,
and consolidated stockholder's equity and cash flows for the
period from the beginning of such fiscal year to the end of
such quarter, all certified by its Chief Financial Officer or
Treasurer as to fairness of presentation and prepared, with
respect to such consolidated statements, in accordance with
Agreement Accounting Principles (subject to normal year end
adjustments).
58
66
FINAL EXECUTION COPY
(iii) Together with the financial statements required hereunder, a
compliance certificate in substantially the form of EXHIBIT
"C" hereto signed by its Chief Financial Officer or Treasurer
showing (a) the calculations necessary to determine compliance
with SECTIONS 6.20, 6.21 and 6.22, (b) for any Compliance
Certificate which covers any portion of the five-month period
from November 1 through March 31, containing a detailed
schedule of the outstanding principal amount of all
short-term Indebtedness of the Borrower and its domestic
Subsidiaries (other than under this Agreement) for money
borrowed during such time and cash and Cash Equivalents of the
Trademark Subsidiaries, (c) for any Compliance Certificate
delivered in connection with the annual financial statements
delivered pursuant to CLAUSE (i) above, a listing identifying
on a Subsidiary by Subsidiary basis the assets owned by the
Borrower and its Subsidiaries, and (d) stating that no Default
or Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof and the
Borrower's plans with respect thereto.
(iv) As soon as possible and in any event within 10 days after an
executive officer of the Borrower knows that any Reportable
Event or any other event described in SECTION 5.9 has occurred
with respect to any Plan, a statement, signed by the Chief
Financial Officer or Treasurer of the Borrower, describing
said Reportable Event or other event and the action which the
Borrower proposes to take with respect thereto.
(v) As soon as possible and in any event within 10 days after
receipt by the Borrower or any Subsidiary, a copy of (a) any
notice or claim to the effect that the Borrower or any of its
Subsidiaries is or may be liable to any Person as a result of
the release by the Borrower, any of its Subsidiaries, or any
other Person of any petroleum, toxic or hazardous waste or
substance into the environment, and (b) any notice alleging
any violation of any Environmental, Health or Safety
Requirements of Law by the Borrower or any of its
Subsidiaries, which, in either case, could reasonably be
expected to have a Material Adverse Effect or subject the
Borrower and its Subsidiaries to liability, individually or in
the aggregate, in excess of $10,000,000 (in each case,
determined after giving effect to claims which the Borrower
has demonstrated to the reasonable satisfaction of the
Administrative Agent are covered by applicable third-party
insurance policies (other than retro-premium insurance or
other policies with similar self- insurance attributes) of the
Borrower or any of its Subsidiaries unless the insurers of
such claims have disclaimed coverage or reserved the right to
disclaim coverage).
(vi) Promptly upon the furnishing thereof to the shareholders of
the Borrower, copies of all financial statements, reports and
proxy statements so furnished.
59
67
FINAL EXECUTION COPY
(vii) Promptly upon the filing thereof, copies of all final
registration statements and annual, quarterly, monthly or
other reports which the Borrower or any of its Subsidiaries
files with the Securities and Exchange Commission (provided
the Borrower shall not be obligated to provide copies of
routine reports which are required to be filed concerning the
management of employee benefit plans, including, without
limitation, stock purchases or the exercise of stock options
made under any such employee benefit plan);
.
(viii) Except to the extent that such items are redundant with
reports or information otherwise provided pursuant to this
SECTION 6.1, promptly upon the furnishing thereof to the
holders thereof, copies of all financial statements and
reports furnished to the holders of (or trustee or other
representative for the holders of) any Indebtedness for money
borrowed of the Borrower or its Subsidiaries.
(ix) Such other information (including non-financial information)
as any Lender through the Administrative Agent may from time
to time reasonably request.
6.2. USE OF PROCEEDS. The Borrower will, and will cause each
Subsidiary to, use the proceeds of the Loans and Facility LCs to (a) consummate
the Marshalls Acquisition, (b) to repay the Prepayment Indebtedness, (c) to
repay outstanding Advances, Swing Loans and Reimbursement Obligations and (d)
for other general corporate purposes, including, without limitation, the
payment of Transaction Costs in connection with the Marshalls Acquisition.
6.3. NOTICE OF DEFAULT. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Administrative Agent of the
occurrence of (a) any Default or Unmatured Default, (b) of any other
development, financial or otherwise, which could reasonably be expected to have
a Material Adverse Effect, or (c) of any other development, financial or
otherwise, which could reasonably be expected to subject the Borrower and its
Subsidiaries to liability, individually or in the aggregate, in excess of
$10,000,000, and in each such case the actions being taken in connection
therewith.
6.4. CONDUCT OF BUSINESS. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as conducted on the
date of this Agreement, and to do all things necessary to remain duly
incorporated, validly existing and in good standing as a domestic corporation
in its jurisdiction of incorporation and maintain all requisite authority to
conduct its business in each jurisdiction in which its business is conducted,
except for transactions permitted by SECTIONS 6.13 or 6.14 and where the
failure to do so could not be reasonably likely to result in a Material Adverse
Effect.
6.5. TAXES. The Borrower will, and will cause each Subsidiary to, pay
when due all material taxes, assessments and governmental charges and levies
upon it or its income, profits or Property,
60
68
FINAL EXECUTION COPY
except those which are being contested in good faith by appropriate
proceedings, with respect to which adequate reserves have been set aside in
accordance with Agreement Accounting Principles and in connection with which no
tax lien has been filed.
6.6. INSURANCE. The Borrower will, and will cause its Subsidiaries
to, maintain with financially sound and reputable insurance companies insurance
on substantially all of their Property in such amounts and covering such risks
as is consistent with sound business practice, and the Borrower will furnish to
the Administrative Agent upon request of any Lender through the Administrative
Agent full information as to the insurance carried.
6.7. COMPLIANCE WITH LAWS. The Borrower will, and will cause its
Subsidiaries to, comply in all material respects with all Requirements of Law,
rules, regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject including, without limitation, all applicable
Environmental, Health or Safety Requirements of Law, except where the failure
to so comply could not reasonably be expected to have a Material Adverse Effect
or subject the Borrower and its Subsidiaries to liability, individually or in
the aggregate, in excess of $25,000,000 (in each case, determined after giving
effect to claims which the Borrower has demonstrated to the reasonable
satisfaction of the Administrative Agent are covered by applicable third-party
insurance policies (other than retro-premium insurance or other policies with
similar self-insurance attributes) of the Borrower or any of its Subsidiaries
unless the insurers of such claims have disclaimed coverage or reserved the
right to disclaim coverage).
6.8. MAINTENANCE OF PROPERTY. The Borrower will, and will cause its
Subsidiaries to, do all things necessary in the judgment of management to
maintain, preserve, protect and keep all of its tangible personal and real
Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on
in connection therewith may be properly conducted at all times. The Borrower
will, and will cause each Subsidiary to, do all things necessary to maintain,
preserve and protect all of its material Intellectual Property including,
without limitation, perform each of its respective obligations under any and
all license agreements and other contracts and agreements evidencing or
relating to Intellectual Property, using the same in interstate or foreign
commerce, properly marking such Intellectual Property and maintaining all
necessary and appropriate governmental registrations (both domestic and
foreign) except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect.
6.9. INSPECTION. The Borrower will, and will cause its Subsidiaries
to, permit the Administrative Agent, the Co-Arrangers and the Lenders, by their
respective representatives and agents, to inspect any of the Property,
corporate books and financial records of the Borrower and its Subsidiaries, to
examine and make copies of the books of accounts and other financial records of
the Borrower and its Subsidiaries, and to discuss the affairs, finances and
accounts of the Borrower and its Subsidiaries with, and to be advised as to the
same by, their respective officers at such reasonable
61
69
FINAL EXECUTION COPY
times and intervals as the Administrative Agent, Co-Arrangers or Lenders may
designate. Prior to the occurrence of a Default or Unmatured Default, the
Lenders will use reasonable efforts to coordinate their inspection through the
Administrative Agent or the Co-Arrangers so as to minimize any disruption to
the business of the Borrower and its Subsidiaries.
6.10. SUBSIDIARIES. The Borrower will cause each Person that becomes
a material (as defined in Section 1-02(w)(1), (2) or (3) of Regulation S-X
under the Securities Act of 1933, as amended)] direct or indirect domestic
Subsidiary of the Borrower after the date of this Agreement (whether as the
result of an Acquisition, creation, or otherwise) to (a) execute and deliver a
Facility Guaranty to and in favor of the Administrative Agent for the benefit
of itself, the Co-Arrangers, the Swing Loan Lenders, the LC Issuers and the
Lenders and (b) execute and deliver a supplement to the Contribution Agreement,
in each case together with an opinion of counsel, corporate resolutions and
such other corporate documentation as the Administrative Agent may reasonably
request, all in form and substance satisfactory to the Administrative Agent and
in each case within 30 days after becoming a direct or indirect Subsidiary of
the Borrower.
6.11. PROHIBITED SELLER PREFERRED STOCK TRANSACTIONS. Other than as a
result of an Excluded Asset Sale with respect to the Series D Seller Preferred
Stock or an Excluded Equity Issuance with respect to either the Series D or
Series E Seller Preferred Stock (or any Capital Stock issued pursuant to an
Excluded Equity Issuance with respect to such Series D or Series E Seller
Preferred Stock), the Borrower will not make and will not permit any Subsidiary
to make any payment to redeem, purchase, repurchase or retire, or to obtain the
surrender of any Seller Preferred Stock now or hereafter outstanding. The
Borrower will not amend, modify or otherwise change any of the terms or
provisions in any of its corporate organizational documents as in effect on the
date hereof in any manner which would change the rights, preferences, terms or
designations of the Seller Preferred Stock (or, after the issuance thereof, any
Capital Stock issued pursuant to an Excluded Equity Issuance with respect to
such Series D or Series E Seller Preferred Stock) other than any such
amendment, modification or other change not less favorable in any material
respect to the Borrower or adverse to the Lenders in any respect reasonably
deemed material by the Required Lenders.
6.12. SUBSIDIARY INDEBTEDNESS. The Borrower will not permit any
Subsidiary to create, incur or suffer to exist any Indebtedness, except:
(i) Indebtedness existing on the date hereof and described in
SCHEDULE 6.12 hereto.
(ii) Indebtedness of any Facility Guarantor to the Borrower or to
any Non-Guarantor Subsidiary (which Indebtedness shall be
subordinated to the claims of the holders of the Obligations
on the same terms as set forth in SECTION 11 in the form of
Facility Guaranty attached hereto as Exhibit "F").
(iii) Indebtedness of any Facility Guarantor to any other Facility
Guarantor.
62
70
FINAL EXECUTION COPY
(iv) Indebtedness of any Facility Guarantor to third parties which
Indebtedness for all such Facility Guarantors does not exceed
$50,000,000 in the aggregate outstanding at any time.
(v) Indebtedness of any domestic Non-Guarantor Subsidiary to third
parties which Indebtedness for all such domestic Non-Guarantor
Subsidiaries does not exceed $25,000,000.
(vi) Indebtedness of any foreign Non-Guarantor Subsidiary to the
Borrower, any Facility Guarantor or any third party the
aggregate amount of all such Indebtedness (including all such
Indebtedness described in clause (i) above) plus the aggregate
amount of all Investments by the Borrower and the Facility
Guarantors in such foreign Non-Guarantor Subsidiaries pursuant
to SECTION 6.15(viii) does not exceed an aggregate outstanding
amount at any time which is greater than 50% of the book value
of the total assets of such foreign Non-Guarantor Subsidiaries
at such time.
(vii) Indebtedness of any domestic Non-Guarantor Subsidiary to the
Borrower or any Facility Guarantor provided (a) such
Indebtedness is incurred in the ordinary course of business
(with respect to both the lending entity and the borrowing
entity) consistent with past practice in such amounts as are
reasonably necessary in connection with the ordinary course
cash management and financial coordination between the
Borrower and its Subsidiaries and (b) (i) with respect to NBC
First Realty Corp. and NBC Second Realty Corp., incurred at a
time for each such Subsidiary when the Indebtedness of such
domestic Non-Guarantor Subsidiary to third parties does not
exceed the aggregate outstanding principal amount of such
Subsidiary's Indebtedness to third parties as of the date of
the initial Credit Extension as set forth on SCHEDULE 6.12 and
(ii) with respect to all other domestic Non-Guarantor
Subsidiaries, incurred at a time when the Indebtedness of such
domestic Non-Guarantor Subsidiary to third parties does not
exceed the aggregate outstanding principal amount of
$2,000,000.00.
(viii) Indebtedness of any Non-Guarantor Subsidiary to any other
Non-Guarantor Subsidiary which is credit-enhanced only by
Contingent Obligations permitted by SECTION 6.16.
(ix) Purchase money Indebtedness (including Capitalized Leases)
incurred by any of the Subsidiaries to finance the acquisition
of fixed assets in the ordinary course of business and any
extension, renewal, refunding or refinancing of any such
purchase money Indebtedness, provided that any such extension,
renewal, refunding or refinancing is in an aggregate principal
amount
63
71
FINAL EXECUTION COPY
not greater than the principal amount of and interest, fees
and expenses accrued on, such Indebtedness and secured by
Liens permitted by SECTION 6.17(a)(viii).
(x) Contingent Obligations permitted under SECTION 6.16.
(xi) Rate Hedging Obligations provided such Rate Hedging
Obligations are incurred in connection with non-speculative
interest rate or foreign currency exchange, swap, collar, cap
or similar derivative agreements pursuant to which the
applicable Subsidiary has hedged its actual interest rate or
foreign currency exposure.
(xii) Mortgage Indebtedness incurred by any Subsidiary secured by
any of such Subsidiary's real property, the proceeds of which
are paid as a mandatory prepayment pursuant to SECTION
2.7(b)(ii) provided that the payment schedule with respect to
such mortgage Indebtedness shall not require payments at time
or in amounts less favorable to the Borrower than the
installments (or portions thereof) of the Term Loans prepaid
with the proceeds of such mortgage Indebtedness.
6.13. MERGER. The Borrower will not, nor will it permit any
Subsidiary to, merge or consolidate with or into any other Person, except:
(i) A Non-Guarantor Subsidiary may merge with and into the
Borrower (provided the surviving corporation is the Borrower).
(ii) A Non-Guarantor Subsidiary may merge with and into any other
Non-Guarantor Subsidiary.
(iii) A Non-Guarantor Subsidiary may merge with and into any
Facility Guarantor provided the surviving Subsidiary is a
Facility Guarantor.
(iv) A Facility Guarantor may merge with and into any other
Facility Guarantor provided the surviving Subsidiary is a
Facility Guarantor.
(v) The Subsidiary or Subsidiaries which are part of any Excluded
Asset Sale may, substantially simultaneously with the
consummation of such Excluded Asset Sale, merge into the
Borrower.
(vi) If the Borrower demonstrates to the Lenders that such merger
would result in material operational or monetary savings to
the Borrower and its Subsidiaries, any Facility Guarantor may
merge with and into the Borrower with the consent of the
Co-Arrangers and the Required Lenders, which consent shall not
be unreasonably withheld it being expressly understood and
agreed that in determining whether to
64
72
FINAL EXECUTION COPY
grant such consent it shall be reasonable for the Co-Arrangers
and the Lenders to take into consideration the impact of such
a merger on the structure of the financing evidenced by this
Agreement and the relative claims of the Lenders and other
creditors of the Borrower and its Subsidiaries.
Nothing herein shall permit any transaction the result of which would be the
occurrence of a Default under SECTION 7.13 and nothing herein shall prohibit a
transaction in compliance with the terms of SECTION 6.15(ix).
6.14. SALE OF ASSETS. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell, transfer or otherwise dispose of its Property to
any other Person except for:
(i) Sales of inventory in the ordinary course of business (which
in the business of the Borrower and its Subsidiaries may
include sales of larger quantities of inventory other than to
consumers provided such sales are consistent with the
Borrower's and its Subsidiaries' past practices and which are
not extraordinary transactions under Agreement Accounting
Principles).
(ii) The sale, discount, or transfer of delinquent accounts
receivable in the ordinary course of business for purposes of
collection only.
(iii) Occasional sales, leases or other dispositions of immaterial
assets for cash consideration and for not less than fair
market value.
(iv) Sales, leases or other dispositions of assets that are
obsolete or have negligible fair market value.
(v) Sales of equipment for cash consideration and for fair market
value (but if replacement equipment is necessary for the
proper operation of the business of the seller, the seller
must promptly replace the sold equipment)
(vi) A Designated Sale for not less than fair market value.
(vii) Sales of assets in the ordinary course of business for not
less than fair market value, including in connection with (a)
planned store closings of the T.J. Maxx and Marshalls stores
identified in the Disclosure Letter or (b) other store
closings of not a substantially greater magnitude than as set
forth in the Information Memorandum or has been the ordinary
course practice of the Borrower and its Subsidiaries prior to
the date of this Agreement.
(viii) Other sales and dispositions of Property for not less than
fair market value.
65
73
FINAL EXECUTION COPY
Notwithstanding anything herein to the contrary:
(a) the aggregate amount of Property of the Borrower and its
Subsidiaries leased, sold or disposed of pursuant to any of
CLAUSES (ii) through (v) and CLAUSES (vii) (other than clause
(a) thereof) and (viii) of this Section (excluding any
equipment which has been promptly replaced) during the
twelve-month period ending with the month in which any such
lease, sale or other disposition occurs shall not: (1) in any
single transaction or series of related transactions
constitute a Substantial Portion of the Property of the
Borrower and its Subsidiaries under clause (b) of the
definition of Substantial Portion or (2) in the aggregate
constitute a Substantial Portion of the Property of the
Borrower and its Subsidiaries under clause (a) of the
definition of Substantial Portion; and
(b) the aggregate amount of Property of any Facility Guarantor
leased, sold or disposed of under any of clauses (i) through
(viii) above which is leased, sold or disposed of to the
Borrower or any other Non-Guarantor Subsidiary shall not
constitute a Substantial Portion of the Property of such
Facility Guarantor.
6.15. INVESTMENTS AND ACQUISITIONS. The Borrower will not, nor will
it permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to
become or remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:
(i) Investments in cash and Cash Equivalents.
(ii) Investments in existence on the date of this Agreement and
described in SCHEDULE 6.15 hereto.
(iii) Current trade and customer accounts receivable that are for
goods furnished or services rendered in the ordinary course of
business and that are payable on terms customary in the trade.
(iv) Loans, capital contributions and other Investments made by the
Borrower in any Facility Guarantor;
(v) Loans, capital contributions and other Investments made by any
Subsidiary in the Borrower;
(vi) Loans, capital contributions and other Investments made by any
Non-Guarantor Subsidiary in any other Subsidiary;
66
74
FINAL EXECUTION COPY
(vii) Loans, capital contributions and other Investments made by any
Facility Guarantor in another Facility Guarantor.
(viii) Loans, capital contributions and other Investments made by the
Borrower or any Facility Guarantor in any foreign
Non-Guarantor Subsidiaries; PROVIDED, that the Borrower shall
be in compliance with the provisions of SECTION 6.12(vi).
(ix) Loans, capital contributions and other Investments made by the
Borrower or any Facility Guarantor in any domestic
Non-Guarantor Subsidiary provided such loans, capital
contributions and other Investments are made in the ordinary
course of business (with respect to both the investing entity
and the domestic Non-Guarantor Subsidiary) consistent with
past practice in such amounts as are reasonably necessary in
connection with the ordinary course cash management and
financial coordination between the Borrower and its
Subsidiaries, (a) with respect to NBC First Realty Corp.
and NBC Second Realty Corp., invested at a time for each such
Subsidiary when the Indebtedness of such domestic
Non-Guarantor Subsidiary to third parties does not exceed the
aggregate outstanding principal amount of such Subsidiary's
Indebtedness to third parties as of the date of the initial
Credit Extension as set forth on SCHEDULE 6.12 and (b) with
respect to all other domestic Non-Guarantor Subsidiaries,
invested at a time when Indebtedness of such domestic
Non-Guarantor Subsidiary to third parties does not exceed the
aggregate outstanding principal amount of $2,000,000.00.
(x) Acquisitions of other Persons made by the Borrower or any
Subsidiaries subsequent to the date of this Agreement;
PROVIDED, that upon giving effect to each such Acquisition (a)
the Person so acquired by the Borrower shall have either been
merged into the Borrower or a Facility Guarantor (with the
Borrower or a Facility Guarantor as the surviving entity) or
such Person shall have become a Wholly-Owned Subsidiary of the
Borrower (and the Borrower shall have complied with SECTION
6.10 in respect of such Subsidiary); (b) no Default or
Unmatured Default shall exist; and (c) the Acquisition is
consummated pursuant to a negotiated acquisition agreement on
a non-hostile basis approved by a majority of the board of
directors of all Persons parties thereto and involves the
purchase of a business line similar, related or incidental to
that of the Borrower and its Subsidiaries as of the date of
this Agreement.
(xi) Investments consisting of Contingent Obligations permitted by
SECTION 6.16.
(xii) Other Investments in any other Persons which do not exceed
$50,000,000 in the aggregate at any time.
67
75
FINAL EXECUTION COPY
For the purpose of any computation required to be made pursuant to this
Agreement, Investments shall be valued at the lower of cost or the fair value
thereof as of the date of computation, where fair value means the value of the
relevant asset determined in an arm's length transaction conducted in good
faith between an informed and willing buyer and an informed and willing seller,
neither under compulsion to buy or sell. With respect to Investments
consisting of debt or quasi-debt securities, for the purposes of this SECTION
6.15, Investments shall be valued at the lower of cost or the fair value of the
initial principal amount, without giving effect to any interest or dividends
paid thereon or any appreciation or depreciation in the market value thereof.
6.16. CONTINGENT OBLIGATIONS. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Contingent Obligation
(including, without limitation, any Contingent Obligation with respect to the
obligations of a Subsidiary), except:
(i) Contingent Obligations existing as of the date of this
Agreement and set forth on SCHEDULE 6.16 hereto.
(ii) Contingent Obligations resulting from endorsement of
instruments for deposit or collection in the ordinary course
of business.
(iii) Reimbursement Obligations in connection with Facility LCs.
(iv) Reimbursement Obligations in connection with Non-Facility LCs
(provided the issuance thereof is not violative of SECTION
6.12).
(v) The Facility Guaranties.
(vi) Contingent Obligations consisting of the Borrower's guaranty
of reimbursement obligations of any Subsidiary in connection
with Non-Facility LCs (provided the issuance thereof is not
violative of SECTION 6.12).
(vii) Contingent Obligations of any Subsidiary to the extent such
Contingent Obligations constitute Indebtedness permitted under
SECTION 6.12.
(viii) Contingent Obligations of the Borrower to the extent such
Contingent Obligations are included in the calculation of
Funded Debt.
(ix) Contingent Obligations of any Facility Guarantor with respect
to Indebtedness of the Borrower or any other Facility
Guarantor; PROVIDED the net amount of such Indebtedness
(after payment of relevant transaction and issuance costs) is
used to make a mandatory prepayment pursuant to the terms of
SECTION 2.7(b); PROVIDED, no such Contingent Obligations
(other than in respect of Non-Facility LCs the issuance
68
76
FINAL EXECUTION COPY
of which is not violative of SECTION 6.12) shall be permitted
with respect to any Indebtedness of the Borrower outstanding
as of the date of this Agreement (or Indebtedness issued or
given in exchange for, or the proceeds of which are used to,
extend, refinance, renew, replace, substitute or refund any
such outstanding Indebtedness or such refinancing
Indebtedness).
(x) Contingent Obligations of any Non-Guarantor Subsidiary of
Indebtedness of the Borrower or any other Subsidiary.
(xi) Contingent Obligations in an additional aggregate amount not
to exceed $50,000,000 at any one time outstanding.
6.17. LIENS; RESTRICTIVE COVENANTS.
(a) LIENS. The Borrower will not, nor will it permit any Subsidiary
to, create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
on its Property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate proceedings
and for which adequate reserves in accordance with Agreement
Accounting Principles shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's,
landlords', lessors' and mechanics' liens and other similar
liens arising in the ordinary course of business which secure
payment of obligations not more than 60 days past due or which
are being contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with Agreement
Accounting Principles shall have been set aside on its books.
(iii) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a
nature generally existing with respect to properties of a
similar character and which do not in any material way affect
the marketability of the same or interfere with the use
thereof in the business of the Borrower or the Subsidiaries.
69
77
FINAL EXECUTION COPY
(v) Purchase-money Liens, Capitalized Leases, Liens on real
property with respect to Indebtedness the proceeds of which
are used (a) for the construction or improvement of the real
property securing such Indebtedness or (b) to refinance the
cost of construction or improvement of such real property
provided such refinancing occurs within one hundred eighty
(180) days of receipt of the certificate of occupancy with
respect to such construction or improvement (other than with
respect to a further refinancing under clause (viii) below).
(vi) Liens existing on the date hereof and described in SCHEDULE
5.14 hereto.
(vii) Liens created or incurred after the date hereof, given to
secure the Indebtedness incurred or assumed in connection with
the acquisition or construction of property or assets useful
and intended to be used in carrying on the business of the
Borrower or any Subsidiary, including Liens existing on such
property or assets at the time of acquisition or construction
thereof or at the time of acquisition by the Borrower or such
Subsidiary, as applicable, of an interest in any business
entity then owning such property or assets, whether or not
such existing Liens were given to secure the consideration for
the property or assets to which they attach, subject to the
requirements that (i) the Lien shall attach solely to the
fixed assets acquired or purchased, (ii) the Lien shall have
been created or incurred within 180 days after the date of
acquisition or completion of construction of such property or
assets (except with respect to refinancing liens under clause
(viii) below) and (iii) all such Indebtedness shall have been
incurred or assumed within the limitations provided in SECTION
6.12 and/or SECTION 6.21, as applicable.
(viii) Any extension, renewal or replacement of any Lien permitted by
the preceding clauses (v) and (vii) and the subsequent clause
(x) in respect of the same property or assets theretofore
subject to such Lien in connection with the extension, renewal
or refunding of the Indebtedness secured thereby; provided
that (a) such Lien shall attach solely to the same property or
assets, and (b) such extension, renewal or refunding of such
Indebtedness shall be without increase in the principal
remaining unpaid as of the date of such extension, renewal or
refunding.
(ix) Liens granted by any Non-Guarantor Subsidiary to the Borrower
or any Facility Guarantor or Liens granted by any Facility
Guarantor as security for any intercompany Indebtedness owing
to the Borrower or to another Facility Guarantor, to the
extent such Indebtedness is permitted under the terms of
SECTION 6.12.
(x) Liens consisting of mortgages with respect to a Subsidiary's
real property in connection with Indebtedness permitted under
the terms of SECTION 6.12(xii).
70
78
FINAL EXECUTION COPY
(xi) Other Liens securing Indebtedness or other obligations not
exceeding $10,000,000 at any one time outstanding.
Notwithstanding anything herein to the contrary, nothing herein shall permit
any pledge or other Liens to attach to the Capital Stock of any Facility
Guarantor.
(b) RESTRICTIVE COVENANTS. Neither the Borrower nor any of its
Subsidiaries shall become a party to any agreement, note, indenture or other
instrument, or take any other action, which would prohibit the creation of a
Lien in favor of the Administrative Agent for the benefit of itself and the
Co-Arrangers, Co-Agents, Swing Loan Lenders, LC Issuers and Lenders on any of
its properties or other assets or require equal and ratable security other than
(i) the Indenture dated as of September 15, 1993 (the "1993 Indenture") between
the Borrower, as issuer, and First Chicago, as trustee, (ii) the Indenture
dated as of May 1, 1986 (the "1986 Indenture") between Zayre Corp. (as
predecessor to the Borrower), as issuer, and The Chase Manhattan Bank (National
Association), as trustee, and (iii) any other agreement regarding Indebtedness
which provides for equal and ratable Liens with respect to only those
properties and assets which are the subject of the restrictive covenants
contained in the 1986 Indenture or the ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and the terms of which
are not materially less favorable to the Borrower or any of its Subsidiaries or
materially adverse to the Lenders than the terms of the 1986 Indenture or the
▇▇▇▇ ▇▇▇▇▇▇▇▇▇.
6.18. CANCELLATION OF LENDERS' DOMESTIC CREDIT FACILITIES. The
Borrower will and will cause each of its Subsidiaries upon the consummation of
each assignment to a Purchaser pursuant to SECTION 12.3.2 which prior thereto
was not a Lender to: (1) pay in full the entire principal amount (together with
accrued interest and premium, if any) of all outstanding loans under all
outstanding domestic committed credit facilities with each of such Purchasers
and (2) terminate and cancel any and all documents, instruments and agreements
executed in connection therewith, including, without limitation, line letter
agreements.
6.19. AFFILIATES. Except in connection with transactions expressly
permitted pursuant to the term of this ARTICLE VI, the Borrower will not, and
will not permit any Subsidiary to, enter into any transaction (including,
without limitation, the purchase or sale of any Property or provision of any
service) with, or make any payment or transfer to, any Affiliate except in the
ordinary course of business and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arm's length transaction; provided,
these provisions shall not be applicable with respect to (i) transactions
among Non- Guarantor Subsidiaries; (ii) transactions among Facility Guarantors;
and (iii) transactions between either the Borrower or a Facility Guarantor and
a Non-Guarantor Subsidiary the terms of which are more favorable to the
Borrower or Facility Guarantor, as applicable, than such that would be obtained
in a comparable arm's length transaction.
71
79
FINAL EXECUTION COPY
6.20. MINIMUM FIXED CHARGE COVERAGE. The Borrower shall maintain a
Consolidated Fixed Charge Coverage Ratio at the end of the fiscal quarter
ending on or about the dates set forth below of at least the ratio set forth
below:
Fiscal Quarters Ending
On or About the
Dates Set Forth Below: Minimum Ratio
---------------------- -------------
January 31, 1996 1.15 to 1.00
April 30, 1996 1.15 to 1.00
July 31, 1996 1.15 to 1.00
October 31, 1996 1.15 to 1.00
January 31, 1997 1.25 to 1.00
April 30, 1997 1.25 to 1.00
July 31, 1997 1.25 to 1.00
October 31, 1997 1.25 to 1.00
January 31, 1998 1.40 to 1.00
April 30, 1998 1.40 to 1.00
July 31, 1998 1.40 to 1.00
October 31, 1998 1.40 to 1.00
January 31, 1999 and
Thereafter 1.50 to 1.00
In each case the Fixed Charge Coverage Ratio shall be determined as of the last
day of each fiscal quarter for the four-quarter period ending on such day.
6.21. MAXIMUM LEVERAGE RATIO. The Borrower shall not permit the ratio
("LEVERAGE RATIO") of:
(i) the sum of (a) Funded Debt of the Borrower and its
Subsidiaries on a consolidated basis and (b) an
amount equal to the product of four (4) multiplied by
Consolidated Rentals for such period to
(ii) the sum of (a) Funded Debt of the Borrower and its
Subsidiaries on a consolidated basis, plus (b) an
amount equal to the product of four (4) multiplied by
Consolidated Rentals for such period plus (c)
Consolidated Net Worth,
72
80
FINAL EXECUTION COPY
to be greater than the ratio set forth below at the end of the fiscal quarter
ending on or about the corresponding date set forth below:
Fiscal Quarters Ending
On or About the
Dates Set Forth Below: Maximum Ratio
---------------------- -------------
January 31, 1996 70%
April 30, 1996 75%
July 31, 1996 75%
October 31, 1996 75%
January 31, 1997 70%
April 30, 1997 72.5%
July 31, 1997 72.5%
October 31, 1997 72.5%
January 31, 1998 70%
April 30, 1998 70%
July 31, 1998 70%
October 31, 1998 70%
January 31, 1999 65%
April 30, 1999 65%
July 31, 1999 65%
October 31, 1999 65%
January 31, 2000
and Thereafter 60%
The Leverage Ratio shall be calculated, in each case, determined as of the last
day of each fiscal quarter based upon (A) for Funded Debt and Consolidated Net
Worth, Funded Debt and Consolidated Net Worth as of the last day of each such
fiscal quarter; and (B) for Consolidated Rentals, the actual amount for the
four-quarter period ending on such day; PROVIDED, HOWEVER, that for the first
four of such fiscal quarters, the computation of Consolidated Rentals shall be
done (i) for Marshalls and its Subsidiaries (or any successors to the business
thereof), the actual amount for the period commencing with the date of this
Agreement and ending with the quarterly period then ended and (ii) for the
Borrower and the other Subsidiaries, the actual amount for the four-quarter
period ending on such day.
73
81
FINAL EXECUTION COPY
6.22. MINIMUM CONSOLIDATED TANGIBLE NET WORTH. The Borrower shall not
permit Consolidated Tangible Net Worth at any time to be less than the sum of
(i) $450,000,000 PLUS (ii) 50% of Consolidated Net Income (if positive) for
each fiscal year of the Borrower commencing with the fiscal year ending on or
about January 31, 1997 and concluding with the fiscal year ending most recently
prior to the date of determination, but without deduction for any fiscal year
in which there is a loss PLUS (iii) 75% of any addition to Consolidated
Tangible Net Worth resulting from Asset-Equity Sales by the Borrower or any of
its Subsidiaries consisting of the issuance of any of its Capital Stock (other
than sales to employees pursuant to employee incentive plans).
ARTICLE VII: DEFAULTS
---------------------
The occurrence of any one or more of the following events shall
constitute a Default:
7.1. BREACH OF REPRESENTATION OR WARRANTY. Any representation or
warranty made (or deemed made pursuant to either SECTION 4.2 of this Agreement
or SECTION 2.1 of any Facility Guaranty) by the Borrower or any Subsidiary to
the Lenders, any LC Issuer, any Swing Loan Lender, any Co-Arranger or the
Administrative Agent under or in connection with this Agreement, any Credit
Extension, any Facility Guaranty, or any certificate or information delivered
in connection with this Agreement or any other Credit Document shall be
materially false on the date as of which made or deemed made or delivered.
7.2. PAYMENT DEFAULT. Nonpayment of (a) any Reimbursement Obligation,
any Swing Loan or the principal of any Note when due, or (b) interest upon any
Note, Swing Loan or Reimbursement Obligation or of any fee or other obligations
under any of the Credit Documents within five (5) days after the same becomes
due.
7.3. BREACH OF CERTAIN COVENANTS. The breach by the Borrower of (a)
any of the terms or provisions of SECTIONS 6.2, 6.3, and 6.4, any of SECTIONS
6.11 through 6.15 and SECTIONS 6.17 through 6.19, or (b) any of the terms of
SECTIONS 6.20 through 6.22 and such breach under this clause (b) continues for
10 days after the first to occur of (i) the date an executive officer of the
Borrower first knows of or should have known of such breach or (ii) the date
the Borrower receives written notice from any Lender (acting through the
Administrative Agent) of such breach.
7.4. BREACH OF OTHER PROVISIONS. The breach by the Borrower (other
than a breach which constitutes a Default under SECTION 7.1, 7.2 or 7.3) of any
of the terms or provisions of this Agreement, and such breach continues for 30
days after the first to occur of (i) the date an executive officer of the
Borrower first knows of or should have known of such breach or (ii) the date
the Borrower receives written notice from any Lender (acting through the
Administrative Agent) of such breach.
74
82
FINAL EXECUTION COPY
7.5. DEFAULT ON MATERIAL INDEBTEDNESS. Failure of the Borrower or any
of its Subsidiaries to make a payment on any Material Indebtedness when due
(after giving effect to any applicable grace period); or either (i) the
Borrower or any of its Subsidiaries shall default in the performance of any
term, provision or condition contained in any agreement or agreements under
which any Material Indebtedness was created or is governed (and any applicable
grace period(s) expressly set forth therein shall have expired) or (ii) any
other event shall occur or condition exist, the effect of which (under either
clause (i) or (ii), as the case may be) is to cause, or to permit the holder or
holders of such Material Indebtedness to cause, such Material Indebtedness to
become due prior to its stated maturity; or any Material Indebtedness of the
Borrower or any of its Subsidiaries shall be declared to be due and payable or
required to be prepaid (other than by a regularly scheduled payment) prior to
the stated maturity thereof; or the Borrower or any of its Subsidiaries shall
not pay, or admit in writing its inability to pay, its debts generally as they
become due.
7.6. VOLUNTARY INSOLVENCY PROCEEDINGS. The Borrower or any of its
Subsidiaries shall (i) have an order for relief entered with respect to it
under the Federal bankruptcy laws as now or hereafter in effect, (ii) make an
assignment for the benefit of creditors, (iii) apply for, seek, consent to, or
acquiesce in, the appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any Substantial Portion of its
Property, (iv) institute any proceeding seeking an order for relief under the
Federal bankruptcy laws as now or hereafter in effect or seeking to adjudicate
it a bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (v) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
SECTION 7.6 , (vi) consent to any appointment or proceeding described in
SECTION 7.7 or (vii) fail to contest in good faith any appointment or
proceeding described in SECTION 7.7.
7.7. INVOLUNTARY INSOLVENCY PROCEEDINGS. Without the application,
approval or consent of the Borrower or any of its Subsidiaries, a receiver,
trustee, examiner, liquidator or similar official shall be appointed for the
Borrower or any of its Subsidiaries or any Substantial Portion of its Property;
or a proceeding described in SECTION 7.6(iv) shall be instituted against the
Borrower or any of its Subsidiaries and such appointment continues undischarged
or such proceeding continues undismissed or unstayed for a period of 60
consecutive days.
7.8. CONDEMNATION. Any court or Governmental Authority shall condemn,
seize or otherwise appropriate, or take custody or control of (each a
"CONDEMNATION"), all or any portion of the Property of the Borrower or any of
its Subsidiaries, which, when taken together with all other Property of the
Borrower and its Subsidiaries, or any of them, so Condemned during the
twelve-month period ending with the month in which any such Condemnation
occurs, constitutes a Substantial Portion of the consolidated Property of the
Borrower and its Subsidiaries.
75
83
FINAL EXECUTION COPY
7.9. JUDGMENTS. The Borrower or any of its Subsidiaries shall fail
within 30 days to pay, bond or otherwise discharge any one or more judgments or
orders for the payment of money in excess of $10,000,000 in the aggregate
(determined after giving effect to claims which the Borrower has demonstrated
to the reasonable satisfaction of the Administrative Agent are covered by
applicable third-party insurance policies (other than retro-premium insurance
or other policies with similar self-insurance attributes) of the Borrower or
any of its Subsidiaries unless the insurers of such claims have disclaimed
coverage or reserved the right to disclaim coverage), which are judgments are
not stayed on appeal with adequate reserves set aside on its books in
accordance with Agreement Accounting Principles of the Borrower or any of its
Subsidiaries.
7.10. ERISA MATTERS. The Unfunded Liabilities of all Single Employer
Plans shall exceed in the aggregate $25,000,000; or any Reportable Event or any
other event described in SECTION 5.9 shall occur in connection with any Plan
which would result in liability to the Borrower or any member of the Controlled
Group, individually, or in the aggregate with all other Reportable Events or
other such events, in excess of $10,000,000 at any one time.
7.11. ENVIRONMENTAL MATTERS. The Borrower or any of its Subsidiaries
shall be the subject of any proceeding or investigation pertaining to the
release by the Borrower or any of its Subsidiaries or any other Person of any
petroleum, toxic or hazardous waste or substance into the environment, or any
violation of any Environmental, Health or Safety Requirements of Law which, in
either case, could reasonably be expected to have a Material Adverse Effect or
subject the Borrower and its Subsidiaries to liability, individually or in the
aggregate, in excess of $10,000,000 (in each case, determined after giving
effect to claims which the Borrower has demonstrated to the reasonable
satisfaction of the Administrative Agent are covered by applicable third-party
insurance policies (other than retro-premium insurance or other policies with
similar self-insurance attributes) of the Borrower or any of its Subsidiaries
unless the insurers of such claims have disclaimed coverage or reserved the
right to disclaim coverage).
7.12. CHANGE OF CONTROL. Any Change in Control shall occur.
7.13. CHANGE OF SUBSIDIARY OWNERSHIP; GUARANTY DEFAULTS. The Borrower
shall cease to own 80% of the outstanding capital stock of any Subsidiary which
has executed a Facility Guaranty except in connection with a transaction
expressly permitted under the terms of SECTIONS 6.13 or 6.14; or any Facility
Guaranty shall fail to remain in full force or effect; or any action shall be
taken to discontinue, revoke or to assert the invalidity or unenforceability of
any Facility Guaranty; or any Subsidiary shall fail to comply with any of the
terms or provisions of any Facility Guaranty to which it is a party; or any
Subsidiary shall deny that it has any further liability under any Facility
Guaranty to which it is a party, or shall give notice to such effect.
76
84
FINAL EXECUTION COPY
ARTICLE VIII: ACCELERATION, WAIVERS,
------------------------------------
AMENDMENTS AND REMEDIES
-----------------------
8.1. REMEDIES.
(a) If any Default described in SECTION 7.6 or 7.7 occurs with respect
to the Borrower, the Revolving Loan Commitments of the Lenders hereunder (and
the obligation of the LC Issuers to issue Facility LCs and of the Swing Loan
Lenders to make Swing Loans) shall automatically terminate and the Obligations
shall immediately become due and payable without any election or action on the
part of the Administrative Agent, the LC Issuers, the Swing Loan Lenders or any
Lender and without presentment, demand, protest or notice of any kind, all of
which the Borrower hereby expressly waives. If any other Default occurs and is
continuing (which Default has not been waived under the terms of SECTION 8.2),
(i) the Required Lenders may terminate or suspend the Revolving Loan
Commitments of the Lenders, (ii) any LC Issuer may terminate or suspend its
obligation to issue Facility LCs, (iii) any Swing Loan Lender may terminate or
suspend its obligation to make Swing Loans, and/or (iv) the Required Lenders
may declare the Obligations to be due and payable, whereupon the Obligations
shall become immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which the Borrower hereby expressly waives.
(b) In addition, the Borrower agrees that upon the occurrence and
during the continuance of any Default, it shall, if requested at any time by
the Administrative Agent upon instruction from the Required Lenders, pay (and,
in the case of any of the Defaults specified in SECTION 7.6 or 7.7 with respect
to the Borrower, forthwith, without any demand or the taking of any other
action by the Administrative Agent or any Lender, it shall pay) to the
Administrative Agent an amount in immediately available funds equal to the then
aggregate amount of the LC Obligations to be held in an interest bearing
account as cash collateral security therefor for the benefit of the Lenders and
the LC Issuers.
(c) If, within 30 days after acceleration of the maturity of the
Obligations or termination of the Revolving Loan Commitments of the Lenders
hereunder as a result of any Default (other than any Default as described in
SECTION 7.6 or 7.7 with respect to the Borrower) and before any judgment or
decree for the payment of the Obligations due shall have been obtained or
entered, and the Required Lenders (in their sole discretion) shall so direct,
the Administrative Agent shall, by notice to the Borrower, rescind and annul
such acceleration and/or termination.
8.2. AMENDMENTS. Subject to the provisions of this ARTICLE VIII, the
Required Lenders (or the Administrative Agent with the consent in writing of
the Required Lenders) and the Borrower may enter into agreements supplemental
hereto for the purpose of adding or modifying
77
85
FINAL EXECUTION COPY
any provisions to the Credit Documents or changing in any manner the rights of
the Lenders or the Borrower hereunder or thereunder or waiving any Default or
Unmatured Default hereunder; PROVIDED, that no such supplemental agreement
shall, without the consent of each Lender:
(a) Increase or decrease the amount of the Revolving Loan
Commitment of any Lender (except for a ratable decrease in the
Commitments of all Lenders); or
(b) Reduce the principal of or rate of interest on any Loan or any
Reimbursement Obligation, or any fees hereunder; or
(c) Other than with respect to the amount and timing of any
mandatory prepayment from the non-cash proceeds of a
Designated Sale agreed to by the Required Lenders, postpone
the date fixed for or amount of any payment (including any
mandatory prepayments and the requirements set forth in
SECTION 2.7(c) ) of principal of or interest on any Loan or
any Reimbursement Obligation, or any fees hereunder; or
(d) Extend the Revolving Loan Termination Date or the Term Loan
Termination Date, or otherwise extend the term of the
Revolving Loan Commitment of any Lender; or
(e) Change the definition of Required Lenders or the percentage of
the Revolving Loan Commitments, the Outstanding Credit
Exposure, Outstanding Swing Loan Exposure or the Outstanding
LC Exposure or of the aggregate unpaid principal amount of the
Notes, or the number of Lenders, which shall be required for
the Lenders or any of them to take any action under this
Section or any other provision of the Credit Documents; or
(f) Permit the Borrower or, permit any Facility Guarantor (except
to the extent permitted by SECTION 6.13 or 6.14) to assign its
rights or obligations under this Agreement or any other Credit
Document; or
(g) Except to the extent expressly contemplated by SECTION 6.13 or
6.14 or the terms of any of the other Credit Documents,
release any Subsidiary from all or any portion of its guaranty
liability under its respective Facility Guaranty or make any
other amendment to the provisions of any Facility Guaranty or
amend or waive any provisions of SECTION 6.10; or
(h) Amend or waive any of the provisions of this SECTION 8.2.
78
86
FINAL EXECUTION COPY
No amendment of any provision of this Agreement relating to the
Administrative Agent, any LC Issuer or any Swing Loan Lender shall be effective
without the written consent of the Administrative Agent, the LC Issuers or the
Swing Loan Lenders, as the case may be. The Administrative Agent may waive
payment of the fee required under SECTION 12.3.2 without obtaining the consent
of any other party to this Agreement.
8.3. PRESERVATION OF RIGHTS. No delay or omission of the Lenders,
Swing Loan Lenders, LC Issuers or the Administrative Agent to exercise any
right under the Credit Documents shall impair such right or be construed to be
a waiver of any Default or Unmatured Default or an acquiescence therein, and
the making of a Loan or Swing Loan or the issuance or Modification of a
Facility LC notwithstanding the existence of a Default or Unmatured Default or
the inability of the Borrower to satisfy the conditions precedent to such Loan,
issuance or Modification shall not constitute any waiver or acquiescence. Any
single or partial exercise of any such right shall not preclude other or
further exercise thereof or the exercise of any other right, and no waiver,
amendment or other variation of the terms, conditions or provisions of the
Credit Documents whatsoever shall be valid unless in writing signed by the
Lenders required pursuant to SECTION 8.2, and then only to the extent in such
writing specifically set forth. All remedies contained in the Credit Documents
or by law afforded shall be cumulative and all shall be available to the
Administrative Agent and the Lenders until the Obligations have been paid in
full.
ARTICLE IX: GENERAL PROVISIONS
------------------------------
9.1. SURVIVAL OF REPRESENTATIONS. All representations and warranties
of the Borrower contained in this Agreement shall survive delivery of the Notes
and the making of the Credit Extensions herein contemplated.
9.2. GOVERNMENTAL REGULATION. Anything contained in this Agreement to
the contrary notwithstanding, no Lender shall be obligated to extend credit to
the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. TAXES. Any taxes (excluding taxes (including income taxes,
franchise taxes and branch profit taxes) as are imposed on or measured by such
Lender's, Swing Loan Lender's or LC Issuer's, as the case may be, income by the
United States of America or any Governmental Authority of the jurisdiction
under the laws of which such Lender, Swing Loan Lender or LC Issuer, as the
case may be, is organized or maintains its Lending Installation) or other
similar assessments or charges made by any Governmental Authority or revenue
authority in respect of the Credit Documents shall be paid by the Borrower,
together with interest and penalties, if any, as provided in SECTION 3.1.
79
87
FINAL EXECUTION COPY
9.4. HEADINGS. Section headings in the Credit Documents are for
convenience of reference only, and shall not govern the interpretation of any
of the provisions of the Credit Documents.
9.5. ENTIRE AGREEMENT. The Credit Documents embody the entire
agreement and understanding among the Borrower, the Administrative Agent and
the Lenders and supersede all prior agreements and understandings among the
Borrower, the Administrative Agent and the Lenders relating to the subject
matter thereof.
9.6. SEVERAL OBLIGATIONS; BENEFITS OF THIS AGREEMENT. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Administrative Agent is authorized to act as contractual representative for the
Lenders hereunder). The failure of any Lender to perform any of its
obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns.
9.7. EXPENSES; INDEMNIFICATION.
(A) EXPENSES. The Borrower shall reimburse the Administrative Agent
and each of the Co-Arrangers for any reasonable costs, out-of-pocket expenses
(including attorneys' and paralegals' fees from one outside counsel for the
Administrative Agent and Co-Arrangers) paid or incurred by the Administrative
Agent or any of the Co-Arrangers in connection with the preparation,
negotiation, execution, delivery, syndication, review, amendment, modification
and administration of the Credit Documents. The Borrower also agrees to
reimburse each of the Administrative Agent, the Co-Arrangers, the LC Issuers,
the Swing Loan Lenders and the Lenders for any reasonable costs, internal
charges and out-of-pocket expenses (including attorneys' and paralegals' fees
and time charges of attorneys and paralegals for such Persons, which attorneys
and paralegals may be employees of such Persons) paid or incurred by the
Administrative Agent, any Co-Arranger, any LC Issuer, any Swing Loan Lender or
any Lender in connection with the collection of the Obligations and enforcement
of the Credit Documents.
(B) INDEMNITY. The Borrower further agrees to defend, protect,
indemnify, and hold harmless the Administrative Agent and each and all of the
Co-Arrangers, LC Issuers, Swing Loan Lenders and Lenders and each of their
respective Affiliates, and each of such Person's respective officers,
directors, employees, partners, managers, shareholders, attorneys and agents
(collectively, the "INDEMNITEES") from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs and expenses of any kind or nature whatsoever (including, without
limitation, the reasonable fees and disbursements of attorneys and paralegals
for such Indemnitees in connection with any investigative, administrative or
judicial proceeding, whether or not such Indemnitees shall be designated a
party thereto),
80
88
FINAL EXECUTION COPY
imposed on, incurred by or asserted against such Indemnitees in any manner
relating to or arising out of:
(i) this Agreement, the other Credit Documents or any of
the other Transaction Documents, or any act, event or
transaction related or attendant thereto or to the
Marshalls Acquisition, the making of the Loans, and
the issuance or Modification of and participation in
Facility LCs hereunder, the management of such Loans
or Facility LCs, the use or intended use of the
proceeds of the Loans or Facility LCs hereunder, or
any of the other transactions contemplated by the
Transaction Documents; or
(ii) any liabilities, obligations, responsibilities,
losses, damages, personal injury, death, punitive
damages, economic damages, consequential damages,
treble damages, intentional, willful or wanton
injury, damage or threat to the environment, natural
resources or public health or welfare, costs and
expenses (including, without limitation, attorney,
expert and consulting fees and costs of
investigation, feasibility or remedial action
studies), fines, penalties and monetary sanctions and
interest, direct or indirect, known or unknown,
absolute or contingent, past, present or future
relating to violation of any Environmental, Health or
Safety Requirements of Law arising from or in
connection with the past, present or future
operations of the Borrower, its Subsidiaries or any
of their respective predecessors in interest, or, the
past, present or future environmental, health or
safety condition of any respective Property of the
Borrower or its Subsidiaries, the presence of
asbestos-containing materials at any respective
property of the Borrower or its Subsidiaries or the
release or threatened release of any petroleum, toxic
or hazardous waste or substance into the environment
(collectively, the "INDEMNIFIED MATTERS");
PROVIDED, HOWEVER, the Borrower shall have no obligation to an Indemnitee
hereunder with respect to Indemnified Matters caused solely by or resulting
solely from the willful misconduct or Gross Negligence of such Indemnitee as
determined by the final non- appealable judgment of a court of competent
jurisdiction. If the undertaking to indemnify, pay and hold harmless set forth
in the preceding sentence may be unenforceable because it is violative of any
law or public policy, the Borrower shall contribute the maximum portion which
it is permitted to pay and satisfy under applicable law, to the payment and
satisfaction of all Indemnified Matters incurred by the Indemnitees.
(C) WAIVER OF CERTAIN CLAIMS; SETTLEMENT OF CLAIMS. The Borrower
further agrees to assert no claim against any of the Indemnitees on any theory
of liability for consequential,
81
89
FINAL EXECUTION COPY
special, indirect, exemplary or punitive damages. No settlement shall be
entered into by the Borrower or any of its Subsidiaries with respect to any
claim, litigation, arbitration or other proceeding relating to or arising out
of the transaction evidenced by this Agreement or the other Credit Documents or
in connection with the Marshalls Acquisition (whether or not the Administrative
Agent or any Lender or any other Indemnitee is a party thereto) unless such
settlement releases all Indemnitees from any and all liability with respect
thereto. After submission of a written request to an Indemnitee from the
Borrower detailing the nature of any claim, litigation, arbitration or other
proceeding which relates to or arises out of the transaction evidenced by this
Agreement or the other Credit Documents or in connection with the Marshalls
Acquisition, such Indemnitee shall inform the Borrower as to whether it will
require compliance with the provisions of this clause (C) or whether it will
waive such compliance, any waiver of which shall be applicable only for such
Indemnitee.
(D) SURVIVAL OF AGREEMENTS. The obligations and agreements of the
Borrower under this SECTION 9.7 shall survive the termination of this
Agreement.
9.8. SEVERABILITY OF PROVISIONS. Any provision in any Credit Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability or validity of that provision in any other
jurisdiction, and to this end the provisions of all Credit Documents are
declared to be severable.
9.9. NONLIABILITY OF LENDERS. The relationship between the Borrower
on the one hand and the Lenders, the LC Issuers, the Swing Loan Lenders, the
Co-Arrangers and the Administrative Agent on the other hand shall be solely
that of borrower and lender. Neither the Administrative Agent, nor any
Co-Arranger, LC Issuer, Swing Loan Lender or Lender, shall have any fiduciary
responsibilities to the Borrower. Neither the Administrative Agent, nor any
Co-Arranger, LC Issuer, Swing Loan Lender or Lender, undertakes any
responsibility to the Borrower to review or inform the Borrower of any matter
in connection with any phase of the Borrower's business or operations.
9.10. GOVERNING LAW. THE ADMINISTRATIVE AGENT ACCEPTS THIS AGREEMENT,
ON BEHALF OF ITSELF, THE CO-ARRANGERS, THE LC ISSUERS, THE SWING LOAN LENDERS
AND THE LENDERS, AT CHICAGO, ILLINOIS BY ACKNOWLEDGING AND AGREEING TO IT
THERE. ANY DISPUTE BETWEEN THE BORROWER AND ANY OF THE ADMINISTRATIVE AGENT,
ANY CO-ARRANGER, ANY LC ISSUER, ANY SWING LOAN LENDER OR ANY LENDER, OR ANY
OTHER HOLDER OF THE OBLIGATIONS ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, AND WHETHER ARISING IN
CONTRACT, TORT,
82
90
FINAL EXECUTION COPY
EQUITY OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS
(WITHOUT REGARD TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS,
BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
9.11. CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.
--------------------------------------------------------
(A) JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT
SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
ANY CREDIT DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR
THAT SUCH COURT IS AN INCONVENIENT FORUM, BUT THE BORROWER ACKNOWLEDGES THAT
ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE
OF CHICAGO, ILLINOIS. EXCEPT AS SET FORTH IN CLAUSE (B) BELOW, ANY JUDICIAL
PROCEEDING BY THE ADMINISTRATIVE AGENT, ANY CO-ARRANGER, ANY CO-AGENT, ANY
SWING LOAN LENDER, ANY LC ISSUER OR ANY LENDER ARISING OUT OF OR RELATING TO
THIS CREDIT AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS IF BROUGHT OTHER
THAN IN ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO,
ILLINOIS, SHALL BE BROUGHT ONLY IN A COURT IN BOSTON, MASSACHUSETTS OR NEW
YORK, NEW YORK. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
ADMINISTRATIVE AGENT, ANY CO-ARRANGER, ANY CO-AGENT, ANY SWING LOAN LENDER, ANY
LC ISSUER OR ANY LENDER OR ANY AFFILIATE OF ANY SUCH PERSON INVOLVING, DIRECTLY
OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED
WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT SHALL BE BROUGHT ONLY IN A
COURT IN CHICAGO, ILLINOIS, BOSTON, MASSACHUSETTS OR NEW YORK, NEW YORK, TO THE
EXTENT THAT JURISDICTION CAN BE OBTAINED AGAINST SUCH PERSONS IN ANY SUCH
JURISDICTION, BUT THE PARTIES HERETO ACKNOWLEDGE THAT ANY APPEALS FROM THOSE
COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF CHICAGO, ILLINOIS,
BOSTON, MASSACHUSETTS OR NEW YORK, NEW YORK. EACH OF THE PARTIES HERETO WAIVES
IN ALL DISPUTES BROUGHT IN THE JURISDICTIONS IDENTIFIED IN THIS SUBSECTION (A)
ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE PROVIDED, WITH RESPECT TO THE ADMINISTRATIVE AGENT OR ANY LENDER,
83
91
FINAL EXECUTION COPY
PERSONAL JURISDICTION WITH RESPECT TO SUCH PARTY MAY BE OBTAINED IN SUCH
JURISDICTION.
(B) OTHER JURISDICTIONS. NOTHING HEREIN SHALL LIMIT THE RIGHT OF ANY
PERSON TO BRING ANY ACTION HEREUNDER IN A COURT IN ANY LOCATION TO ENABLE SUCH
PERSON TO OBTAIN PERSONAL JURISDICTION OVER ANY OTHER PERSON WITH RESPECT
HERETO. THE BORROWER AGREES THAT THE ADMINISTRATIVE AGENT, ANY CO-ARRANGER,
ANY LC ISSUER, ANY SWING LOAN LENDER, ANY LENDER OR ANY OTHER HOLDER OF THE
OBLIGATIONS SHALL HAVE THE RIGHT TO PROCEED AGAINST THE BORROWER OR ITS
PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO ENFORCE A JUDGMENT
OR OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. THE BORROWER AGREES THAT
IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT UNDER
THIS CLAUSE (B) BY SUCH PERSON TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN
FAVOR OF SUCH PERSON, ALL OF WHICH PERMISSIVE COUNTERCLAIMS SHALL BE BROUGHT BY
THE BORROWER IN THE JURISDICTIONS IDENTIFIED IN CLAUSE (A) ABOVE. THE BORROWER
WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH
SUCH PERSON HAS COMMENCED A PROCEEDING DESCRIBED IN THIS SUBSECTION (B).
(C) SERVICE OF PROCESS; INCONVENIENT FORUM. THE BORROWER WAIVES
PERSONAL SERVICE OF ANY PROCESS UPON IT AND AGREES THAT ANY SUCH PROCESS MAY BE
SERVED BY REGISTERED MAIL TO THE BORROWER AT ITS ADDRESS FOR NOTICES PURSUANT
TO SECTION 13.1. THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH IN ANY JURISDICTION SET FORTH ABOVE.
(D) WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY RIGHT TO HAVE
A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT
OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY
OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH. EACH OF THE PARTIES HERETO
84
92
FINAL EXECUTION COPY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.
(E) ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER
PARTY HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE
PROVISIONS OF THIS SECTION 9.11 WITH ITS COUNSEL.
9.12. CONFIDENTIALITY. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement
in confidence, except for disclosure (i) to other Lenders and its and their
respective Affiliates, Transferees and prospective Transferees, (ii) to legal
counsel, accountants and other professional advisors to that Lender or to
Transferees or prospective Transferees pursuant to SECTION 12.4, (iii) to
regulatory officials, (iv) to any Person as requested (which request such
Lender reasonably believes could give rise to mandatory disclosure) or pursuant
to or as required by law, regulation or legal process, (v) to any Person in
connection with any legal proceeding to which that Lender is a party with
respect to any claim, litigation, arbitration or other proceeding relating to
or arising out of the transaction evidenced by this Agreement or the other
Credit Documents or in connection with the Marshalls Acquisition, (vi) to any
Person in connection with any other legal proceeding to which that Lender is a
party provided such Lender uses reasonable efforts to give the Borrower notice
of any disclosure thereunder, provided any failure in such regard shall not
result in any liability on the part of such Lender, and (vii) permitted by
SECTION 12.4.
9.13. OTHER TRANSACTIONS. Each of the Lenders, Co-Arrangers, Swing
Loan Lenders, LC Issuers, Administrative Agent and the Borrower acknowledges
that the Lenders (or affiliates of the Lenders) may, from time to time, effect
transactions for their own accounts or the accounts of customers, and hold
positions in loans or options on loans of the Borrower, the Borrower's
Subsidiaries and other companies that may be the subject of this credit
arrangement and nothing in this Agreement shall impair the right of any such
Person to enter into any such transaction (to the extent it is not expressly
prohibited by the terms of this Agreement) or give any other Person any claim
or right of action hereunder as a result of the existence of the credit
arrangements hereunder, all of which are hereby waived. In addition, certain
affiliates of one or more of the Lenders are or may be securities firms and as
such may effect, from time to time, transactions for their own accounts or for
the accounts of customers and hold positions in securities or options on
securities of the Borrower, the Borrower's Subsidiaries and other companies
that may be the subject of this credit arrangement and nothing in this
Agreement shall impair the right of any such Person to enter into any such
transaction (to the extent it is not expressly prohibited by the
85
93
FINAL EXECUTION COPY
terms of this Agreement) or give any other Person any claim or right of action
hereunder as a result of the existence of the credit arrangements hereunder,
all of which are hereby waived.
9.14. FACILITY GUARANTY RELEASES. Each of the Lenders, Co-Arrangers,
Swing Loan Lenders, LC Issuers and Administrative Agent agrees that upon the
consummation of any transaction involving the sale of all or substantially all
of the assets of a Facility Guarantor, which sale is permitted pursuant to the
terms of SECTION 6.13 and the Net Cash Proceeds of which are applied in
compliance with the terms of this Agreement, the Administrative Agent, for
itself and on behalf of the Lenders, Co-Arrangers, Swing Loan Lenders and LC
Issuers shall release and terminate the Facility Guaranty with respect to the
Facility Guarantor which is the subject of such transaction.
ARTICLE X: THE ADMINISTRATIVE AGENT
-----------------------------------
10.1. APPOINTMENT; NATURE OF RELATIONSHIP. The First National Bank of
Chicago is appointed by the Co-Arrangers, LC Issuers, Swing Loan Lenders and
Lenders as the Administrative Agent hereunder and under each other Credit
Document, and each of the Co-Arrangers, LC Issuers, Swing Loan Lenders and
Lenders irrevocably authorizes the Administrative Agent to act as the
contractual representative of such Person with the rights and duties expressly
set forth herein and in the other Credit Documents. The Administrative Agent
agrees to act as such contractual representative upon the express conditions
contained in this ARTICLE X. Notwithstanding the use of the defined term
"Administrative Agent" or "agent" in reference to The First National Bank of
Chicago, it is expressly understood and agreed that the Administrative Agent
shall not have any fiduciary responsibilities to any Co-Arranger, LC Issuer,
Swing Loan Lender or Lender by reason of this Agreement and that the
Administrative Agent is merely acting as the representative of the
Co-Arrangers, LC Issuers, Swing Loan Lenders and Lenders with only those duties
as are expressly set forth in this Agreement and the other Credit Documents.
In its capacity as such contractual representative, the Administrative Agent
(i) does not assume any fiduciary duties to any of the Co-Arrangers, LC
Issuers, Swing Loan Lenders or Lenders, (ii) is a "representative" of the
Co-Arrangers, LC Issuers, Swing Loan Lenders and Lenders within the meaning of
Section 9-105 of the Uniform Commercial Code and (iii) is acting as an
independent contractor, the rights and duties of which are limited to those
expressly set forth in this Agreement and the other Credit Documents. Each of
the Co-Arrangers, LC Issuers, Swing Loan Lenders and Lenders agrees to assert
no claim against the Administrative Agent on any agency theory or any other
theory of liability for breach of fiduciary duty, all of which claims each
Co-Arranger, LC Issuer, Swing Loan Lender and Lender waives.
10.2. POWERS. The Administrative Agent shall have and may exercise
such powers under the Credit Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers as
are reasonably incidental thereto. The Administrative
86
94
FINAL EXECUTION COPY
Agent shall have no implied duties or fiduciary duties to the Co-Arrangers, LC
Issuers, Swing Loan Lenders or Lenders, or any obligation to the Co-Arrangers,
LC Issuers, Swing Loan Lenders or Lenders to take any action hereunder or under
any of the other Credit Documents except any action specifically provided by
the Credit Documents required to be taken by the Administrative Agent.
10.3. GENERAL IMMUNITY. Neither the Administrative Agent nor any of
its directors, officers, agents or employees shall be liable to the Borrower or
any Co-Arranger, LC Issuer, Swing Loan Lender or Lender for any action taken or
omitted to be taken by it or them hereunder or under any other Credit Document
or in connection herewith or therewith except to the extent such action or
inaction is found in a final judgment by a court of competent jurisdiction to
have arisen solely from the Gross Negligence or willful misconduct of such
Person.
10.4. NO RESPONSIBILITY FOR LOANS, CREDITWORTHINESS, COLLATERAL,
RECITALS, ETC. Neither the Administrative Agent nor any of its directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or representation
made in connection with any Credit Document or any Credit Extension hereunder;
(ii) the performance or observance of any of the covenants or agreements of the
Borrower, any Facility Guarantor or any other obligor under any Credit
Document; (iii) the satisfaction of any condition specified in ARTICLE IV,
except receipt of items required to be delivered solely to the Administrative
Agent; (iv) the existence or possible existence of any Default or (v) the
validity, effectiveness or genuineness of any Credit Document or any other
instrument or writing furnished in connection therewith. The Administrative
Agent shall not be responsible to any Co-Arranger, LC Issuer, Swing Loan Lender
or Lender for any recitals, statements, representations or warranties herein or
in any of the other Credit Documents or for the execution, effectiveness,
genuineness, validity, legality, enforceability, collectibility or sufficiency
of this Agreement or any of the other Credit Documents or the transactions
contemplated thereby, or for the financial condition of any Facility Guarantor
or other obligor of any or all of the Obligations, the Borrower or any of their
respective Subsidiaries. The Administrative Agent will use its reasonable
efforts to distribute to each of the Lenders, in a timely fashion, a copy of
all written reports, certificates and information required to be supplied by
the Borrower or any of its Subsidiaries to the Administrative Agent pursuant to
the terms of this Agreement or any of the other Credit Documents; provided any
failure in such regard shall not result in any liability on the part of the
Administrative Agent.
10.5. ACTION ON INSTRUCTIONS OF LENDERS. The Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder and under any other Credit Document in accordance with written
instructions signed by the Required Lenders or all of the Lenders (as
applicable under SECTION 8.2), and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Co-Arrangers, LC
Issuers, Swing Loan Lenders, Lenders and any other holders of the Notes or
Obligations. The Administrative Agent
87
95
FINAL EXECUTION COPY
shall be fully justified in failing or refusing to take any action hereunder
and under any other Credit Document unless it shall first be indemnified to its
satisfaction (which shall not include any requirement that it be indemnified
for its willful misconduct or Gross Negligence) by the Lenders pro rata against
any and all liability, cost and expense that it may incur by reason of taking
or continuing to take any such action.
10.6. EMPLOYMENT OF AGENTS AND COUNSEL. The Administrative Agent may
execute any of its duties as the Administrative Agent hereunder and under any
other Credit Document by or through employees, agents and attorney-in-fact and
shall not be answerable to the Co-Arrangers, LC Issuers, Swing Loan Lenders or
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Administrative Agent shall be
entitled to advice of counsel concerning the contractual arrangement between
the Administrative Agent and the Co-Arrangers, LC Issuers, Swing Loan Lenders
and Lenders and all matters pertaining to the Administrative Agent's duties
hereunder and under any other Credit Document.
10.7. RELIANCE ON DOCUMENTS; COUNSEL. The Administrative Agent shall
be entitled to rely upon any Note, notice, consent, certificate, affidavit,
letter, telegram, statement, paper or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and,
in respect of legal matters, upon the opinion of counsel selected by the
Administrative Agent, which counsel may be employees of the Administrative
Agent and which counsel may have acted as counsel for the Administrative Agent
and the Co-Arrangers in connection with the negotiation and execution of this
Agreement and the other Credit Documents.
10.8. THE ADMINISTRATIVE AGENT'S REIMBURSEMENT AND INDEMNIFICATION.
The Lenders agree to reimburse and indemnify the Administrative Agent ratably
in proportion to their respective Percentage (i) for any amounts not reimbursed
by the Borrower for which the Administrative Agent is entitled to reimbursement
by the Borrower under the Credit Documents, (ii) for any other expenses
incurred by the Administrative Agent on behalf of the Co-Arrangers, LC Issuers,
Swing Loan Lenders or Lenders, in connection with the preparation, execution,
delivery, administration and enforcement of the Credit Documents (including
with respect to any disagreement between or among any of the Administrative
Agent, Co-Arrangers, LC Issuers, Swing Loan Lenders or Lenders) and (iii) for
any liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature whatsoever which
may be imposed on, incurred by or asserted against the Administrative Agent in
any way relating to or arising out of the Credit Documents or any other
document delivered in connection therewith or the transactions contemplated
thereby, or the enforcement of any of the terms thereof or of any such other
documents, provided that no Lender shall be liable for any of the foregoing to
the extent any of the foregoing is found in a final non-appealable judgment by
a
88
96
FINAL EXECUTION COPY
court of competent jurisdiction to have arisen solely from the Gross Negligence
or willful misconduct of the Administrative Agent.
10.9. RIGHTS AS A LENDER. With respect to its Revolving Loan
Commitment, Loans made by it, Facility LCs issued by it and Notes issued to it,
First Chicago (or any other Person succeeding it as the Administrative Agent)
shall have the same rights and powers hereunder and under any other Credit
Document as any Lender, LC Issuer or Swing Loan Lender, as applicable, and may
exercise the same as through it were not the Administrative Agent, and the
terms "Co-Arranger," "Co-Arrangers," "Lender," "Lenders," "LC Issuer," "LC
Issuers," "Swing Loan Lender," and "Swing Loan Lenders" shall, unless the
context otherwise indicates, include First Chicago (or any other Person
succeeding it as the Administrative Agent) in its individual capacity. First
Chicago (or any other Person succeeding it as the Administrative Agent) may
accept deposits from, lend money to, and generally engage in any kind of trust,
debt, equity or other transaction, in addition to those contemplated by this
Agreement or any other Credit Document, with the Borrower or any of its
Subsidiaries in which such Person is not prohibited hereby from engaging with
any other Person.
10.10. LENDER CREDIT DECISION. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Co-Arranger (including in its capacity as documentation agent, syndication
agent, co-syndication agent or co-arranger), LC Issuer, Swing Loan Lender or
Lender and based on the financial statements prepared by the Borrower and its
Subsidiaries and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement and the other Credit Documents. Each Lender also acknowledges that
it will, independently and without reliance upon the Administrative Agent or
any other Co-Arranger, LC Issuer, Swing Loan Lender or 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 and the other Credit Documents.
10.11. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrower, and the Administrative Agent may be removed at any time with or
without cause by written notice received by the Administrative Agent from the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint, without the consent of the Borrower and on
behalf of the Co-Arrangers, Co-Agents, Swing Loan Lenders, LC Issuers and
Lenders, a successor Administrative Agent. If no successor Administrative
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty days after the retiring Administrative
Agent's giving notice of resignation, then the retiring Administrative Agent
may appoint, without the consent of the Borrower and on behalf of the Co-
Arrangers, Co-Agents, LC Issuers, Swing Loan Lenders and Lenders, a successor
Administrative Agent, which successor Administrative Agent shall be a Lender
unless no Lender shall so agree
89
97
FINAL EXECUTION COPY
in which event such successor Administrative Agent may be a Person of the
Administrative Agent's choosing. Notwithstanding anything herein to the
contrary, so long as no Default has occurred and is continuing, each such
successor Administrative Agent shall be subject to approval by the Borrower,
which approval shall not be unreasonably withheld. Such successor
Administrative Agent shall be a commercial bank having capital and retained
earnings of at least $100,000,000. Upon the acceptance of any appointment as
the Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder and under the other Credit Documents.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this ARTICLE X shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Administrative Agent hereunder and under the other
Credit Documents.
10.12. ADMINISTRATIVE AGENT'S FEES. The Borrower agrees to pay to
the Administrative Agent, for its own account, the fees agreed to by the
Borrower pursuant to that certain letter agreement dated October 14, 1995, or
as otherwise agreed from time to time.
10.13. NO DUTIES IMPOSED UPON CO-ARRANGERS, SYNDICATION AGENT,
CO-SYNDICATION AGENTS OR DOCUMENTATION AGENT. None of the Lenders identified
on the cover page to this Agreement, the signature pages to this Agreement or
otherwise in this Agreement as a "Co-Arranger," "syndication agent,"
"co-syndication agent," "documentation agent" or "Co-Agent" shall have any
right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limiting
the foregoing, none of the Lenders identified on the cover page to this
Agreement, the signature pages to this Agreement or otherwise in this
Agreements as a "Co-Arranger," "syndication agent," "co-syndication agent,"
"documentation agent" or "Co-Agent" shall have or be deemed to have any
fiduciary duty to or fiduciary relationship with any Lender. In addition to
the agreements set forth in SECTION 10.10, each of the Lenders acknowledges
that it has not relied, and will not rely, on any of the Lenders so identified
in deciding to enter into this Agreement or in taking or not taking action
hereunder.
ARTICLE XI: SETOFF; RATABLE PAYMENTS
------------------------------------
11.1. SETOFF. In addition to, and without limitation of, any rights
of the Lenders, LC Issuers or Swing Loan Lenders under applicable law, if the
Borrower becomes insolvent, however evidenced, any Default occurs or any
Unmatured Default occurs and is continuing, any and all deposits (including all
account balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender,
LC Issuer or Swing Loan Lender to or for the credit or account of the Borrower
may be offset and
90
98
FINAL EXECUTION COPY
applied toward the payment of the Obligations owing to such Lender, LC Issuer
or Swing Loan Lender, whether or not the Obligations, or any part hereof, shall
then be due.
11.2. RATABLE PAYMENTS. If any Lender, whether by setoff or
otherwise, has payment made to it upon its Outstanding Credit Exposure (other
than payments received which are for the account of the Administrative Agent,
any Swing Loan Lender, any LC Issuer or any Co-Arranger or pursuant to SECTION
3.1, 3.2, 3.4 or 3.6 or ARTICLE XIII) in a greater proportion than that
received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Aggregate Outstanding Credit Exposure held by the
other Lenders so that after such purchase each Lender will hold its Percentage
of the Aggregate Outstanding Credit Exposure. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or
otherwise, receives collateral or other protection for its Obligations or such
amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to respective Percentages of
the Aggregate Outstanding Credit Exposure. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
11.3. APPLICATION OF PAYMENTS. The Administrative Agent shall, unless
otherwise specified at the direction of the Required Lenders which direction
shall be consistent with the last sentence of this SECTION 11.3, apply all
payments and prepayments in respect of any Obligations in the following order:
(A) first, to pay interest on and then principal of any
portion of the Loans which the Administrative Agent may have advanced
on behalf of any Lender for which the Administrative Agent has not
then been reimbursed by such Lender or Borrower;
(B) second, to pay Obligations in respect of any fees,
expense reimbursements or indemnities then due to the Administrative
Agent;
(C) third, to pay interest on and then principal outstanding
on the Swing Loans, applied ratably to all outstanding Swing Loans;
(D) fourth, to the ratable payment of Obligations in respect
of any fees, expenses, reimbursements or indemnities then due to the
Lenders, Swing Loan Lenders and LC Issuers;
(E) fifth, to pay interest due in respect of Loans (other
than Swing Loans) and LC Obligations;
91
99
FINAL EXECUTION COPY
(F) sixth, to the ratable payment or prepayment of principal
outstanding on Loans (other than Swing Loans) and Reimbursement
Obligations in such order as the Agent may determine in its sole
discretion;
(G) seventh, to provide required cash collateral, if any,
pursuant to SECTION 2.19; and
(H) eighth, to the ratable payment of all other Obligations.
Unless otherwise designated (which designation shall only be applicable prior
to the occurrence of a Default) by Borrower or unless otherwise mandated by the
terms of this Agreement, all principal payments in respect of Loans shall be
applied FIRST, to repay outstanding Money Market Rate Loans, SECOND to repay
other outstanding Floating Rate Loans, and THEN to repay outstanding Eurodollar
Loans with those Eurodollar Loans which have earlier expiring Interest Periods
being repaid prior to those which have later expiring Interest Periods. The
order of priority set forth in this SECTION 11.3 and the related provisions of
this Agreement are set forth solely to determine the rights and priorities of
the Administrative Agent, the Lenders, the Swing Loan Lenders and the LC
Issuers as among themselves. The order of priority set forth in CLAUSES (D)
through (H) of this SECTION 11.3 may at any time and from time to time be
changed by the Required Lenders without necessity of notice to or consent of or
approval by Borrower or any other Person. The order of priority set forth in
CLAUSES (A) and (B) of this SECTION 11.3 may be changed only with the prior
written consent of the Administrative Agent and the order of priority set forth
in CLAUSE (C) may be changed only with the prior written consent of the Swing
Loan Lenders.
ARTICLE XII: BENEFIT OF AGREEMENT;
----------------------------------
ASSIGNMENTS; PARTICIPATION
--------------------------
12.1. SUCCESSORS AND ASSIGNS. The terms and provisions of the
Borrower Credit Documents shall be binding upon and inure to the benefit of the
Borrower, the Administrative Agent, the LC Issuers, the Swing Loan Lenders, the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under
this Agreement or the other Borrower Credit Documents and (ii) any assignment
by any Lender must be made in compliance with SECTION 12.3. Notwithstanding
clause (ii) of this Section, any Lender may at any time, without the consent of
the Borrower, the Administrative Agent, any LC Issuer or any Swing Loan Lender,
assign all or any portion of its rights under the Credit Documents to a Federal
Reserve Bank; PROVIDED, HOWEVER, that no such assignment shall release the
transferor Lender from its obligations hereunder. The Administrative Agent may
treat the payee of any Note as the owner thereof for all purposes hereof unless
and until such payee complies with SECTION 12.3 in the case of an assignment
thereof or, in the case of any other
92
100
FINAL EXECUTION COPY
transfer, a written notice of the transfer is filed with the Administrative
Agent. Any assignee or transferee of a Note agrees by acceptance thereof to be
bound by all the terms and provisions of the Credit Documents. Any request,
authority or consent of any Person, who at the time of making such request or
giving such authority or consent is the holder of any Note, shall be conclusive
and binding on any subsequent holder, transferee or assignee of such Note or of
any Note or Notes issued in exchange therefor. Upon the completion of the
General Syndication or otherwise upon the effectiveness of any assignment under
the terms hereof, the Administrative Agent shall have the power to amend,
without the signature of the Borrower or any other Lender, Co-Arranger, Swing
Loan Lender or LC Issuer, SCHEDULE 1.1 hereto to reflect the effect of such
General Syndication or other assignments.
12.2. PARTICIPATIONS.
12.2.1 PERMITTED PARTICIPANTS; EFFECT. Any Lender may, in
the ordinary course of its business and in accordance with applicable
law, at any time sell to one or more banks or other Eligible Assignees
("PARTICIPANTS") participating interests in any Outstanding Credit
Exposure owing to such Lender, any Note held by such Lender, any
Revolving Loan Commitment of such Lender or any other interest of such
Lender under the Credit Documents. In the event of any such sale by a
Lender of participating interests to a Participant, such Lender's
obligations under the Credit Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, such Lender shall remain the
holder of any such Note for all purposes under the Credit Documents,
all amounts payable by the Borrower under this Agreement shall be
determined as if such Lender had not sold such participating
interests, and the Borrower, the LC Issuers, the Swing Loan Lenders,
the Co-Arrangers, the Lenders and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under the Credit Documents.
12.2.2. VOTING RIGHTS. Each Lender shall retain the sole
right to approve, without the consent of any Participant, any
amendment, modification or waiver of any provision of the Credit
Documents, other than any such amendment, modification or waiver which
requires the unanimous consent of the Lenders under SECTION 8.2.
12.2.3. BENEFIT OF SETOFF. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided
in SECTION 11.1 in respect of its participating interest in amounts
owing under the Credit Documents to the same extent as if the amount
of its participating interest were owing directly to it as a Lender
under the Credit Documents, provided that each Lender shall retain the
right of setoff provided in SECTION 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree
to share with each Participant, and each Participant, by exercising
the right of setoff PROVIDED in SECTION 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right
93
101
FINAL EXECUTION COPY
of setoff, provided in SECTION 11.1, agrees to share with each Lender,
any amount received pursuant to the exercise of its right of setoff,
such amounts to be shared in accordance with SECTION 11.2 as if
each Participant were a Lender.
12.3. ASSIGNMENTS.
12.3.1. PERMITTED ASSIGNMENTS. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time assign to one or more banks or other entities
("PURCHASERS") all or any part of its rights and obligations under the
Credit Documents; PROVIDED, that each such assignment shall be in the
minimum principal amount of $5,000,000. Each such assignment shall be
substantially in the form of EXHIBIT "E" hereto or in such other form
as may be agreed to by the Administrative Agent and the parties
thereto. In connection with each such assignment (whether or not the
consent of the Borrower shall be required in connection therewith) to
a Purchaser which maintains a committed domestic line of credit to the
Borrower, the assigning Lender shall give the Borrower notice of the
proposed assignment in order to facilitate the Borrower's compliance
with the terms of SECTION 6.18. The consent of the Borrower, the LC
Issuers, the Swing Loan Lenders and the Administrative Agent shall be
required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or an Affiliate thereof (none of which
consents may be unreasonably withheld or delayed); PROVIDED, that the
consent of the Borrower shall not be required (i) if such assignment
is part of an assignment by the Co-Arrangers or the Co-Agents of
their rights and obligations under the Credit Documents and is to an
Eligible Assignee in connection with the General Syndication, (ii) if
such assignment is to a financial institution which as of October 14,
1995 maintained a committed line of credit to the Borrower or its
Subsidiaries or (iii) if a Default has occurred and is continuing.
12.3.2. EFFECT; EFFECTIVE DATE. Upon (i) delivery to the
Administrative Agent of a notice of assignment, substantially in the
form attached as Exhibit "A" to EXHIBIT "E" hereto (a "NOTICE OF
ASSIGNMENT"), together with any consents required by SECTION 12.3.1,
and (ii) payment of a $3,500 fee to the Administrative Agent for
processing such assignment, such assignment shall become effective on
the effective date specified in such Notice of Assignment; provided,
however, no such fee shall be payable in connection with the General
Syndication by the Co-Arrangers or the Co-Agents. On and after the
effective date of such assignment, such Purchaser shall for all
purposes be a Lender party to this Agreement and any other Credit
Document executed by the Lenders and shall have all the rights and
obligations of a Lender under the Credit Documents, to the same extent
as if it were an original party hereto, and no further consent or
action by the Borrower, the Lenders, the LC Issuers, the Swing Loan
Lenders or the Administrative Agent shall be required to release the
transferor Lender with respect to the percentage of the Aggregate
Revolving Loan Commitment and Outstanding Credit Exposure assigned
94
102
FINAL EXECUTION COPY
to such Purchaser. Upon the consummation of any assignment to a
Purchaser pursuant to this SECTION 12.3.2, the transferor Lender, the
Administrative Agent and the Borrower shall make appropriate
arrangements so that replacement Notes are issued to the transferor
Lender and new or replacement Notes, as appropriate, are issued to
such Purchaser, in each case in principal amounts reflecting their
Revolving Loan Commitments, as adjusted pursuant to such assignment.
12.3.3. COVENANTS OF THE BORROWER DURING THE GENERAL
SYNDICATION. Until the Co-Arrangers have notified the Borrower that
the Co-Arrangers and the Co-Agents have completed the syndication of
the Co-Arrangers' rights and obligations through the initial primary
syndication to a select group of financial institutions and thereafter
the Co-Arrangers' and the Co-Agents' rights and obligations to a
broader group of financial institutions (the "GENERAL SYNDICATION")
the Borrower agrees (a) not to take to market any additional bank or
other facilities for money borrowed or for any debt securities (other
than commercial paper) and (b) to make the funding indemnification
payments required under SECTION 3.4 in connection with such General
Syndication.
12.4. DISSEMINATION OF INFORMATION. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person
acquiring an interest in the Credit Documents by operation of law (each a
"TRANSFEREE") and any prospective Transferee any and all information in such
Lender's possession concerning the creditworthiness of the Borrower and its
Subsidiaries; PROVIDED, that each Transferee and prospective Transferee agrees
to be bound by SECTION 9.12.
12.5. TAX TREATMENT. If any interest in any Credit Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of SECTION 2.18.
ARTICLE XIII: NOTICES
---------------------
13.1. GIVING NOTICE. Except as otherwise permitted by SECTION 2.13
with respect to Borrowing Notices, all notices and other communications
provided to any party hereto under this Agreement or any other Credit Document
shall be given either in writing or by facsimile and addressed or delivered to
such party at its address or facsimile number, as the case may be, set forth
across from its name on SCHEDULE 1.1 hereto or at such other address or
facsimile number as may be designated by such party in a notice to the other
parties. Any notice, if mailed and properly addressed with postage prepaid,
shall be deemed given when received; any notice, if properly transmitted by
facsimile, shall be deemed given when transmitted.
95
103
FINAL EXECUTION COPY
13.2. CHANGE OF ADDRESS. The Borrower, the Administrative Agent, any
Co-Arranger, any LC Issuer and any Lender may each change the address and/or
facsimile number for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV: COUNTERPARTS
-------------------------
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Administrative Agent, the Co-Arrangers, the LC Issuers, the Swing Loan Lenders
and the Lenders and each party has notified the Administrative Agent by
facsimile or telephone that it has taken such action.
96
104
FINAL EXECUTION COPY
IN WITNESS WHEREOF, the Borrower, the Lenders, the LC Issuers, the
Swing Loan Lenders, the Co-Arrangers and the Administrative Agent have executed
this Agreement as of the date first above written.
THE TJX COMPANIES, INC.
By:___________________________
Name:_________________________
Title:________________________
THE FIRST NATIONAL BANK OF
CHICAGO, as Administrative Agent, as a
Co-Arranger, as a LC Issuer, as a
Swing Loan Lender and as a Lender
By:___________________________
Name:_________________________
Title:________________________
i
Signature Page to TJX Credit Agreement
105
FINAL EXECUTION COPY
BANK OF AMERICA ILLINOIS, as
Syndication Agent, as a
Co-Arranger, as a LC Issuer,
as a Swing Loan Lender and as
a Lender
By:___________________________
Name:_________________________
Title:________________________
ii
Signature Page to TJX Credit Agreement
106
FINAL EXECUTION COPY
THE BANK OF NEW YORK, as Documentation
Agent, as a Co-Arranger, as a LC
Issuer, as a Swing Loan Lender and as
a Lender
By:___________________________
Name:_________________________
Title:________________________
iii
Signature Page to TJX Credit Agreement
107
FINAL EXECUTION COPY
PEARL STREET, L.P., as a Co-Arranger, as
a Swing Loan Lender and as a Lender
By:___________________________
Name:_________________________
Title:________________________
iv
Signature Page to TJX Credit Agreement
108
FINAL EXECUTION COPY
CANADIAN IMPERIAL BANK OF COMMERCE, as
a Co-Agent and a Lender
By:___________________________
Name:_________________________
Title:________________________
v
Signature Page to TJX Credit Agreement
109
FINAL EXECUTION COPY
CREDIT LYONNAIS NEW YORK BRANCH, as a
Co-Agent and a Lender
By:___________________________
Name:_________________________
Title:________________________
CREDIT LYONNAIS CAYMAN ISLANDS BRANCH,
as a Co-Agent and a Lender
By:___________________________
Name:_________________________
Title:________________________
vi
Signature Page to TJX Credit Agreement
110
FINAL EXECUTION COPY
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN BRANCHES , as a Co-Agent and
a Lender
By:___________________________
Name:_________________________
Title:________________________
vii
Signature Page to TJX Credit Agreement
111
FINAL EXECUTION COPY
THE FIRST NATIONAL BANK OF BOSTON, as
a Co-Agent and a Lender
By:___________________________
Name:_________________________
Title:________________________
viii
Signature Page to TJX Credit Agreement
112
FINAL EXECUTION COPY
PNC BANK, NATIONAL ASSOCIATION, as a
Co-Agent and a Lender
By:___________________________
Name:_________________________
Title:________________________
ix
Signature Page to TJX Credit Agreement
113
FINAL EXECUTION COPY
SHAWMUT BANK, N.A., as a Co-Agent and
a Lender
By:___________________________
Name:_________________________
Title:________________________
x
Signature Page to TJX Credit Agreement