CREDIT AGREEMENT
among
FDX CORPORATION,
THE LENDERS,
FIRST CHICAGO CAPITAL MARKETS, INC.,
as Arranger
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
as Co-Arranger and Syndication Agent
CHASE SECURITIES INC.,
as Co-Arranger and Documentation Agent
and
THE FIRST NATIONAL BANK OF CHICAGO,
Individually and as Agent
Dated as of January 15, 1998
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
THE CREDITS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
2.1. COMMITMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
2.2. MANDATORY PAYMENTS; TERMINATION. . . . . . . . . . . . . . . . . . .16
2.3. RATABLE LOANS; TYPES OF ADVANCES . . . . . . . . . . . . . . . . . .16
2.4. DETERMINATION OF LEVELS. . . . . . . . . . . . . . . . . . . . . . .16
2.5. FACILITY FEES; AGENT'S FEE; REDUCTIONS IN AGGREGATE COMMITMENT . . .16
2.6. MINIMUM AMOUNT OF EACH ADVANCE . . . . . . . . . . . . . . . . . . .17
2.7. OPTIONAL PRINCIPAL PAYMENTS. . . . . . . . . . . . . . . . . . . . .17
2.8. METHOD OF SELECTING TYPES AND INTEREST PERIODS FOR NEW ADVANCES. . .17
2.9. CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES. . . . . . . . .18
2.10. INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
2.11. RATES APPLICABLE AFTER MATURITY OF ADVANCES. . . . . . . . . . . . .19
2.12. METHOD OF PAYMENT. . . . . . . . . . . . . . . . . . . . . . . . . .19
2.13. EVIDENCE OF DEBT; TELEPHONIC NOTICES . . . . . . . . . . . . . . . .19
2.14. INTEREST PAYMENT DATES; INTEREST AND FEE BASIS . . . . . . . . . . .20
2.15. NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND COMMITMENT
REDUCTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
2.16. LENDING INSTALLATIONS. . . . . . . . . . . . . . . . . . . . . . . .21
2.17. NON-RECEIPT OF FUNDS BY THE AGENT. . . . . . . . . . . . . . . . . .21
2.18. WITHHOLDING TAX EXEMPTION. . . . . . . . . . . . . . . . . . . . . .21
2.19. EXTENSION OF TRANCHE B FACILITY TERMINATION DATE . . . . . . . . . .22
ARTICLE III
CHANGE IN CIRCUMSTANCES . . . . . . . . . . . . . . . . . . . . . . . . . . .22
3.1. YIELD PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . .22
3.2. CHANGES IN CAPITAL ADEQUACY REGULATIONS. . . . . . . . . . . . . . .23
3.3. AVAILABILITY OF TYPES OF ADVANCES. . . . . . . . . . . . . . . . . .23
3.4. FUNDING INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . .24
3.5. LENDER STATEMENTS; SURVIVAL OF INDEMNITY . . . . . . . . . . . . . .24
i
ARTICLE IV
CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
4.1. CLOSING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
4.2. EACH ADVANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
ARTICLE V
REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . . . . . . . .26
5.1. CORPORATE EXISTENCE AND STANDING . . . . . . . . . . . . . . . . . .26
5.2. AUTHORIZATION AND VALIDITY . . . . . . . . . . . . . . . . . . . . .26
5.3. NO CONFLICT; GOVERNMENT CONSENT. . . . . . . . . . . . . . . . . . .27
5.4. FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . .27
5.5. TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
5.6. LITIGATION AND CONTINGENT OBLIGATIONS. . . . . . . . . . . . . . . .28
5.7. SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
5.8. ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
5.9. ACCURACY OF INFORMATION. . . . . . . . . . . . . . . . . . . . . . .28
5.10. REGULATION U . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
5.11. MATERIAL AGREEMENTS. . . . . . . . . . . . . . . . . . . . . . . . .28
5.12. COMPLIANCE WITH LAWS . . . . . . . . . . . . . . . . . . . . . . . .28
5.13. EXISTING LIENS . . . . . . . . . . . . . . . . . . . . . . . . . . .29
5.14. INVESTMENT COMPANY ACT . . . . . . . . . . . . . . . . . . . . . . .29
5.15. CITIZENSHIP. . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
5.16. STATUS AS AIR CARRIER. . . . . . . . . . . . . . . . . . . . . . . .29
5.17. PARI PASSU . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
ARTICLE VI
COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
6.1. FINANCIAL REPORTING. . . . . . . . . . . . . . . . . . . . . . . . .30
6.2. USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . . . . .31
6.3. NOTICE OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . .31
6.4. CONDUCT OF BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . .32
6.5. CITIZENSHIP AND REGULATORY CERTIFICATES. . . . . . . . . . . . . . .32
6.6. PAYMENT OF TAXES . . . . . . . . . . . . . . . . . . . . . . . . . .32
6.7. INSURANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
6.8. COMPLIANCE WITH LAWS . . . . . . . . . . . . . . . . . . . . . . . .33
6.9. MAINTENANCE OF PROPERTIES. . . . . . . . . . . . . . . . . . . . . .33
6.10. INSPECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
6.11. DIVIDEND DECLARATIONS. . . . . . . . . . . . . . . . . . . . . . . .33
6.12. LEVERAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
6.13. FIXED CHARGE COVERAGE. . . . . . . . . . . . . . . . . . . . . . . .33
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6.14. RESTRICTED INVESTMENTS . . . . . . . . . . . . . . . . . . . . . . .33
6.15. MERGER AND CONSOLIDATION . . . . . . . . . . . . . . . . . . . . . .34
6.16. SALES OF ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . .34
6.17. LOANS, ADVANCES AND INVESTMENTS. . . . . . . . . . . . . . . . . . .35
6.18. CONTINGENT LIABILITIES . . . . . . . . . . . . . . . . . . . . . . .37
6.19. LIENS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
6.20. GUARANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
6.21. CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES. . . . . . . . . . . . .39
ARTICLE VII
DEFAULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40
7.1. BREACH OF REPRESENTATION OR WARRANTY . . . . . . . . . . . . . . . .40
7.2. FAILURE TO PAY . . . . . . . . . . . . . . . . . . . . . . . . . . .40
7.3. BREACH OF CERTAIN COVENANTS. . . . . . . . . . . . . . . . . . . . .40
7.4. BREACH OF OTHER COVENANTS. . . . . . . . . . . . . . . . . . . . . .40
7.5. CROSS-DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . . . .40
7.6. VOLUNTARY BANKRUPTCY, ETC. . . . . . . . . . . . . . . . . . . . . .41
7.7. INVOLUNTARY BANKRUPTCY, ETC. . . . . . . . . . . . . . . . . . . . .41
7.8. JUDGMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
7.9. ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
7.10. SEIZURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
7.11. ENVIRONMENTAL MATTERS. . . . . . . . . . . . . . . . . . . . . . . .41
7.12. INVALIDITY, ETC. OF LOAN DOCUMENTS . . . . . . . . . . . . . . . . .42
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES. . . . . . . . . . . . . . . .42
8.1. ACCELERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
8.2. AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
8.3. PRESERVATION OF RIGHTS . . . . . . . . . . . . . . . . . . . . . . .43
ARTICLE IX
GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43
9.1. SURVIVAL OF REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . .43
9.2. GOVERNMENTAL REGULATION. . . . . . . . . . . . . . . . . . . . . . .43
9.3. TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
9.4. HEADINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
9.5. ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . .44
9.6. SEVERAL OBLIGATIONS; BENEFITS OF THIS AGREEMENT. . . . . . . . . . .44
9.7. EXPENSES; INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . .44
iii
9.8. NUMBERS OF DOCUMENTS . . . . . . . . . . . . . . . . . . . . . . . .44
9.9. SEVERABILITY OF PROVISIONS . . . . . . . . . . . . . . . . . . . . .45
9.10. NONLIABILITY OF LENDERS. . . . . . . . . . . . . . . . . . . . . . .45
9.11. CHOICE OF LAW. . . . . . . . . . . . . . . . . . . . . . . . . . . .45
9.12. CONSENT TO JURISDICTION. . . . . . . . . . . . . . . . . . . . . . .45
9.13. WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . .45
9.14. CONFIDENTIALITY. . . . . . . . . . . . . . . . . . . . . . . . . . .45
9.15. ACCOUNTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
9.16. RELEASE OF GUARANTORS. . . . . . . . . . . . . . . . . . . . . . . .46
ARTICLE X
THE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
10.1. APPOINTMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
10.2. POWERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
10.3. GENERAL IMMUNITY . . . . . . . . . . . . . . . . . . . . . . . . . .47
10.4. NO RESPONSIBILITY FOR LOANS, RECITALS, ETC . . . . . . . . . . . . .47
10.5. ACTION ON INSTRUCTIONS OF LENDERS. . . . . . . . . . . . . . . . . .47
10.6. EMPLOYMENT OF AGENTS AND COUNSEL . . . . . . . . . . . . . . . . . .47
10.7. RELIANCE ON DOCUMENTS; COUNSEL . . . . . . . . . . . . . . . . . . .47
10.8. AGENT'S REIMBURSEMENT AND INDEMNIFICATION. . . . . . . . . . . . . .47
10.9. RIGHTS AS A LENDER . . . . . . . . . . . . . . . . . . . . . . . . .48
10.10. LENDER CREDIT DECISION . . . . . . . . . . . . . . . . . . . . . . .48
10.11. SUCCESSOR AGENT. . . . . . . . . . . . . . . . . . . . . . . . . . .48
10.12. DISTRIBUTION OF INFORMATION. . . . . . . . . . . . . . . . . . . . .49
ARTICLE XI
SETOFF; RATABLE PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . .49
11.1. SETOFF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
11.2. RATABLE PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . .49
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS . . . . . . . . . . . . . .50
12.1. SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . . . . . . . . .50
12.2. PARTICIPATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . .50
12.2.1. PERMITTED PARTICIPANTS; EFFECT. . . . . . . . . . . . . . .50
12.2.2. VOTING RIGHTS . . . . . . . . . . . . . . . . . . . . . . .51
12.2.3. BENEFIT OF SETOFF . . . . . . . . . . . . . . . . . . . . .51
iv
12.3. ASSIGNMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .51
12.3.1. PERMITTED ASSIGNMENTS . . . . . . . . . . . . . . . . . . .51
12.3.2. REQUIRED ASSIGNMENTS. . . . . . . . . . . . . . . . . . . .51
12.3.3. EFFECT; EFFECTIVE DATE. . . . . . . . . . . . . . . . . . .52
12.4. DISSEMINATION OF INFORMATION . . . . . . . . . . . . . . . . . . . .52
12.5. TAX TREATMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . .52
ARTICLE XIII
NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53
13.1. GIVING NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . .53
13.2. CHANGE OF ADDRESS. . . . . . . . . . . . . . . . . . . . . . . . . .53
ARTICLE XIV
COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53
ARTICLE XV
TERMINATION OF 1995 CREDIT AGREEMENT. . . . . . . . . . . . . . . . . . . . .53
v
EXHIBIT "A"
FORM OF GUARANTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77
EXHIBIT "B"
OPINION OF COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88
EXHIBIT "C"
ASSIGNMENT AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . .91
EXHIBIT "D"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION . . . . . . . . . . . . . . 100
SCHEDULE "1"
SIGNIFICANT SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . . . . . 101
SCHEDULE "2"
COMPLIANCE CALCULATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . 102
vi
FDX CORPORATION
CREDIT AGREEMENT
This Agreement, dated as of January 15, 1998, is among FDX CORPORATION, the
Lenders and THE FIRST NATIONAL BANK OF CHICAGO, as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
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 going business or all or substantially all
of the assets of any Person 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.
"Advance" means a borrowing hereunder consisting of the aggregate amount of
the several Tranche A Loans or Tranche B Loans made by the Lenders to the
Borrower of the same Type and, in the case of Eurodollar Advances, for the same
Interest Period.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
when used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means The First National Bank of Chicago in its capacity as agent
for the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced from time to time pursuant to the terms hereof.
"Aggregate Tranche A Commitment" means the aggregate of the Tranche A
Commitments of all of the Lenders, as reduced from time to time pursuant to the
terms hereof. As of the Effective Date, the Aggregate Tranche A Commitment
equals $800,000,000.
"Aggregate Tranche B Commitment" means the aggregate of the Tranche B
Commitments of all of the Lenders, as reduced from time to time pursuant to the
terms hereof. As of the Effective Date, the Aggregate Tranche B Commitment
equals $200,000,000.
"Agreement" means this Credit Agreement, as it may be amended or modified
and in effect from time to time.
"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 Tranche A Facility Fee Percentage" means, subject to the
following provisions of this definition, the per annum rate corresponding to the
Level in effect from time to time, as set forth in the following table:
--------------------------------------------------------------------------------
Level Applicable Facility Fee Percentage
--------------------------------------------------------------------------------
I .075%
--------------------------------------------------------------------------------
II .090%
--------------------------------------------------------------------------------
III .110%
--------------------------------------------------------------------------------
IV .125%
--------------------------------------------------------------------------------
V .175%
--------------------------------------------------------------------------------
Each change in the Applicable Tranche A Facility Fee Percentage resulting from a
change in a Rating shall take effect at the time such change in such Rating is
publicly announced by the relevant rating agency.
"Applicable Tranche A Margin" means, subject to the following provisions of
this definition, the per annum rate of interest corresponding to the Level in
effect from time to time, as set forth in the following table:
--------------------------------------------------------------------------------
Level Applicable Tranche A Margin
--------------------------------------------------------------------------------
I .175%
--------------------------------------------------------------------------------
II .185%
--------------------------------------------------------------------------------
III .215%
--------------------------------------------------------------------------------
2
--------------------------------------------------------------------------------
Level Applicable Tranche A Margin
--------------------------------------------------------------------------------
IV .250%
--------------------------------------------------------------------------------
V .375%
--------------------------------------------------------------------------------
Each change in the Applicable Tranche A Margin resulting from a change in a
Rating shall take effect at the time such change in such Rating is publicly
announced by the relevant rating agency.
"Applicable Tranche B Facility Fee Percentage" means .085% per annum.
"Applicable Tranche B Margin" means .24% per annum.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any one of the Chief Executive Officer, the
Executive Vice President and Chief Financial Officer, the Treasurer, or the
Managing Director Corporate Finance and Assistant Treasurer of the Borrower or
any other officer or employee of the Borrower designated in writing as an
"Authorized Officer" under this Agreement by any one of the Chief Executive
Officer, the Executive Vice President and Chief Financial Officer, the
Treasurer, or the Managing Director Corporate Finance and Assistant Treasurer of
the Borrower.
"Beneficial Owner" means a Person deemed the "Beneficial Owner" of any
securities as to which such Person or any of such Person's Affiliates is or may
be deemed to be the beneficial owner pursuant to Rule 13d-3 or 13d-5 under the
Securities Exchange Act of 1934 (as the same may from time to time be amended,
modified or readopted), as well as any securities as to which such Person or any
of such Person's Affiliates has the right to become such a beneficial owner
(whether such right is exercisable immediately or only after the passage of time
or the occurrence of a specified event) pursuant to any agreement, arrangement
or understanding, or upon the exercise of conversion rights, exchange rights,
rights, warrants or options, or otherwise. In determining the percentage of the
outstanding Voting Stock with respect to which a Person is the Beneficial Owner,
all shares as to which such Person is deemed the Beneficial Owner shall be
deemed outstanding.
"Borrower" means FDX Corporation, a Delaware corporation.
"Borrowing Date" means a date on which an Advance 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 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
3
market and (ii) for all other purposes, a day (other than a Saturday or Sunday)
on which banks generally are open in Chicago for the conduct of substantially
all of their commercial lending activities.
"Caliber" means Caliber System, Inc., an Ohio corporation.
"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 GAAP.
"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 GAAP.
"Capitalized Operating Lease Value" means the present value, using a
discount rate equal to 12.5%, of the Borrower's and the Consolidated
Subsidiaries' future minimum lease payments for aircraft leases scheduled to
terminate more than 365 days after their respective dates of execution.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the aggregate amount of its Tranche A
Commitment and its Tranche B Commitment.
"Consolidated Adjusted Net Worth" means, at any date as of which the amount
thereof is to be determined, (a) the sum of the amounts set forth as preferred
stock, common stock, capital in excess of par value or paid-in surplus and
retained earnings on a consolidated balance sheet of the Borrower and the
Consolidated Subsidiaries prepared as of such date in accordance with GAAP,
minus (b) the sum of the amounts set forth on such consolidated balance sheet as
(i) the cost of any shares of the Borrower's common stock held in the treasury
and (ii) any surplus resulting from any write-up of assets after the date of
this Agreement and (iii) the aggregate value of all goodwill, all determined in
accordance with GAAP.
"Consolidated Adjusted Total Assets" means, at any date as of which the
amount thereof is to be determined, (a) the aggregate amount set forth as the
assets of the Borrower and the Consolidated Subsidiaries on a consolidated
balance sheet of the Borrower and the Consolidated Subsidiaries prepared as of
such date in accordance with GAAP, minus (b) the aggregate book value as of such
date of determination of all assets of the Borrower or any Consolidated
Subsidiary subject on such date of determination to a Lien permitted by Section
6.19(j).
"Consolidated Cash Flow" means, on a consolidated basis for the Borrower
and its Consolidated Subsidiaries for the twelve most recent complete fiscal
months, the sum of (i) income (loss) before income taxes, plus (ii) Interest
Expense, plus (iii) Rent Expense, in each case as determined in accordance with
GAAP.
4
"Consolidated Net Income" means, for any period, the net income (or net
loss) of the Borrower and the Consolidated Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP and after giving
appropriate effect to any outside minority interests in the Consolidated
Subsidiaries, excluding
(a) any aggregate net gain arising from the sale or other
disposition of any assets other than any such gain arising from the
sale or other disposition of assets (including aircraft) in the
ordinary course of business,
(b) any gain arising from any write-ups of assets,
(c) any unrealized capital gain or loss on any investment,
(d) any portion of the earnings of any Consolidated Subsidiary which
for any reason is unavailable for payment of dividends to the Borrower or
another Consolidated Subsidiary,
(e) any amount representing the interest of the Borrower and the
Consolidated Subsidiaries in the undistributed earnings of any other Person
(other than a Consolidated Subsidiary), and
(f) the net income (or net loss) of any Person prior to the date it
became a Consolidated Subsidiary.
"Consolidated Subsidiary" means at any date any Subsidiary or other entity
the accounts of which would be consolidated with those of the Borrower (or
FedEx, for any date prior to the date the Borrower was established as the parent
of FedEx) in its consolidated financial statements in accordance with GAAP if
such statements were prepared as of such date.
"Contingent Obligation" of a Person means any agreement, undertaking or
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 obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or application for a Letter of Credit.
"Continuing Director" means an individual who is a member of the Board of
Directors of the Borrower on the date of this Agreement or who shall have become
a member of the Board of Directors of the Borrower subsequent to such date and
who shall have been nominated or elected by a majority of the other Continuing
Directors then members of the Board of Directors of the Borrower.
"Conversion/Continuation Notice" is defined in Section 2.9.
5
"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.
"Current Market Price" means, with respect to any security on any date, the
last sale price or, in case no such sale takes place on such date, the average
of the closing bid and asked prices for such security, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange, Inc.
or, if such security is not then listed or admitted to trading on the New York
Stock Exchange, Inc., as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which such security is listed or admitted to trading or,
if such security is not then listed or admitted to trading on any national
securities exchange, on the NASDAQ National Market System or, if such security
is not then quoted on such National Market System, the average of the closing
bid and asked prices for such security in the over-the-counter market, as
reported by NASDAQ or such other system then in use, or, if on any such date
such security is not then quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market-maker then
making a market in such security selected by the Board of Directors of the
Borrower or a duly authorized committee thereof; provided, however, that if on
any such date such security is not listed or admitted to trading on a national
securities exchange or traded in the over-the-counter market, the "Current
Market Price" of such security on such date shall mean the fair value thereof on
such date as determined in good faith by the Board of Directors of the Borrower
or a duly authorized committee thereof.
"Current Maturities" means, as of any date with respect to the Long Term
Debt or the Capitalized Lease Obligations of any Person, any portion of such
Long Term Debt or Capitalized Lease Obligations, as the case may be, which would
in accordance with GAAP be classified as a current liability of such Person.
"Dealer" means a Lender, First Tennessee Bank, N.A., Union Planters
National Bank of Memphis or any other national or state bank or trust company or
dealer or broker of government securities having either (A) capital, surplus and
undivided profits or (B) total equity of at least $250,000,000, or any affiliate
thereof authorized to deal in the commercial products described in clauses (i),
(ii), and (iii) of Section 6.17(e).
"Default" means an event described in Article VII.
"Effective Date" means the Business Day on or before March 2, 1998 on which
(a) the Borrower, the Agent and the Lenders have executed this Agreement, (b)
the Borrower has
6
satisfied all of the terms and conditions of Section 4.1, and (c) the Borrower
has paid all fees then due to the Agent and the Lenders in connection with this
Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"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 Interest Period, the rate determined by the Agent to be the arithmetic
average of the rates reported to the Agent by each Reference Lender as the rate
at which deposits in U.S. dollars are offered by such Reference Lender 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 Interest Period,
in the approximate amount of such Reference Lender's relevant Eurodollar Loan
and having a maturity approximately equal to such Interest Period. If any
Reference Lender 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 Lender(s).
"Eurodollar Loan" means a Loan which bears interest at a Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) an amount equal to (a) the Eurodollar
Base Rate applicable to such Interest Period, divided by (b) one minus the
Reserve Requirement (expressed as a decimal), if any, applicable to such
Interest Period, and (ii) the Applicable Tranche A Margin, if such Advance
consists of Tranche A Loans, or the Applicable Tranche B Margin, if such Advance
consists of Tranche B Loans. The Eurodollar Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.
"FAA" means the Federal Aviation Administration or any other governmental
agency succeeding to the jurisdiction thereof.
"Fair Market Value" means (i) as to securities which are publicly traded,
the average of the Current Market Prices of such securities for each day during
the period of 10 consecutive trading days immediately preceding the date of
determination and (ii) as to securities which are not publicly traded or any
other property, the fair value thereof as determined in good faith by the Board
of Directors of the Borrower or a duly authorized committee thereof.
"Federal Aviation Act" means the Federal Aviation Act of 1958, as amended
from time to time.
"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
7
Day, the average of the quotations at approximately 10 a.m. (Chicago time) on
such day on such transactions received by the Agent from three Federal funds
brokers of recognized standing selected by the Agent in its sole discretion.
"FedEx" means Federal Express Corporation, a Delaware corporation.
"First Chicago" means The First National Bank of Chicago in its individual
capacity, and its successors.
"Flight Equipment" means, collectively, aircraft, aircraft engines,
appliances and spare parts, all as defined in the Federal Aviation Act, and
related parts.
"Floating Rate" means, for any day, a rate per annum equal to the Alternate
Base Rate for such day, 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" means any Indebtedness (other than items characterized as
Indebtedness pursuant to clause (vii) of the definition thereof) of the Borrower
and its Consolidated Subsidiaries that is outstanding on the date of
determination.
"GAAP" means generally accepted principles of accounting as in effect at
the time of application to the provisions hereof provided that any modification
in generally accepted accounting principles which is made within twelve months
prior to any such application and which would result in a Default or Unmatured
Default shall be disregarded.
"Guarantor" means FedEx, RPS, Caliber, Viking Freight, Inc. and ▇▇▇▇▇▇▇
Express, Inc., and each other Subsidiary that executes the Guaranty in
accordance with Section 6.20 hereof.
"Guaranty" means that certain Guaranty of even date herewith, executed by
each Guarantor, substantially in the form of Exhibit "A" attached hereto.
"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 accounts payable arising in
the ordinary course of such Person's business payable on terms customary in the
trade), (iii) obligations, whether or not assumed, secured by Liens or payable
out of the proceeds or production from property now or hereafter owned or
acquired by such Person, (iv) obligations which are evidenced by notes,
acceptances, or other instruments, (v) Capitalized Lease Obligations, (vi) net
liabilities under interest rate swap, exchange or cap agreements, (vii)
Contingent Obligations, and (viii) obligations created through asset
securitization financing programs.
8
"Interest Expense" means, for any period, the gross interest expense
(without regard to any offsetting interest income or reduction for capitalized
interest) of the Borrower and its Consolidated Subsidiaries determined on a
consolidated basis in accordance with GAAP.
"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. Such 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
Interest Period shall end on the last Business Day of such next, second, third,
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business Day, such 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 Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade), deposit
account (other than a demand deposit account maintained in the ordinary course
of business) 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.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, any
office, branch, subsidiary or affiliate of such Lender or the Agent.
"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.
"Level" means any of Level I, Level II, Level III, Level IV, or Level V.
"Level I" means, subject to Section 2.4, a Rating equal to or better than
A- from S&P or A3 from Moody's.
"Level II" means, subject to Section 2.4, a Rating equal to or better than
BBB+ from S&P or Baa1 from Moody's but less than a Rating that would place the
Borrower at Level I.
"Level III" means, subject to Section 2.4, a Rating equal to or better than
BBB from S&P or Baa2 from Moody's but less than a Rating that would place the
Borrower at Level I or Level II.
9
"Level IV" means, subject to Section 2.4, a Rating equal to or better than
BBB- from S&P or Baa3 from Moody's but less than a Rating that would place the
Borrower at Level I, Level II or Level III.
"Level V" means, subject to Section 2.4, Ratings lower than BBB- from S&P
and Baa3 from Moody's.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement 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 any Tranche A Loan or Tranche B Loan by a Lender to the
Borrower pursuant to Section 2.1(a) or (b), respectively, and "Loans" means the
Tranche A Loans and Tranche B Loans.
"Loan Documents" means this Agreement and the Guaranty.
"Long Term Debt" means, as of any date with respect to any Person, all
liabilities of such Person outstanding on such date which would in accordance
with GAAP be classified as long term debt of such Person.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents, or
(iii) the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Agent or the Lenders thereunder.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. or, if Moody's shall cease
rating Indebtedness of the Borrower and FedEx and its ratings business with
respect to Indebtedness of the Borrower and FedEx shall have been transferred to
a successor Person, such successor Person; provided, however, that if Moody's
ceases rating securities similar to Indebtedness of the Borrower and FedEx and
its ratings business with respect to such securities shall not have been
transferred to any successor Person, then "Moody's" shall mean any other
nationally recognized rating agency (other than S&P) selected by the Borrower
that rates any Indebtedness of the Borrower and FedEx.
"▇▇▇▇▇'▇ Rating" means, at any particular time, the higher of the ratings
issued by Moody's with respect to the Borrower's or FedEx's senior unsecured
long-term public debt.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
10
"Notice of Assignment" is defined in Section 12.3.3.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans (including, without limitation, interest accruing at
the then-applicable rate provided herein after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding), all accrued and
unpaid fees and all expenses, reimbursements, indemnities and other
obligations of the Borrower to the Lenders or to any Lender, the Agent or any
indemnified party hereunder arising under the Loan Documents.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each February, May, August, and
November after the date of this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"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.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned or leased
by such Person.
"Purchaser" is defined in Section 12.3.1.
"Rating" means the ▇▇▇▇▇'▇ Rating or the S&P Rating.
"Reference Lenders" means First Chicago, The Chase Manhattan Bank and
▇▇▇▇▇▇ Guaranty Trust Company of New York.
"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 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 applicable to member banks of the Federal Reserve System.
11
"Rent Expense" means, for any period, the rental expense of the Borrower
and its Consolidated Subsidiaries determined on a consolidated basis in
accordance with GAAP excluding rental expense with respect to leases of aircraft
scheduled to terminate no more than 365 days after their respective dates of
execution.
"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 has
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 in the aggregate having at least 66-2/3%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 66-2/3% of the aggregate unpaid
principal amount of the outstanding Advances.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Restricted Investment" means any Investment other than an Investment
permitted by Section 6.17.
"Restructuring Event" means any of the following: (1) any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date thereof)
becoming the Beneficial Owner of Voting Stock of the Borrower having more than
30 percent of the voting power of all of the then outstanding Voting Stock of
the Borrower; (2) individuals who are not Continuing Directors constituting a
majority of the Board of Directors of the Borrower, or individuals who are not
appointed or designated by the Borrower constituting a majority of the Board of
Directors of FedEx or RPS; (3) the Borrower consolidating with or merging into
any other Person, or any other Person consolidating with or merging into the
Borrower, pursuant to a transaction in which capital stock of the Borrower then
outstanding (other than capital stock held by the Borrower or capital stock held
by any Person which is a party to such consolidation or merger) is changed or
exchanged unless the Borrower is the surviving entity and no Default or
Unmatured Default shall occur upon giving effect to such consolidation or
merger; (4) FedEx or RPS consolidating with or merging into any other Person
which is not a Subsidiary of the Borrower, or any other such Person
consolidating with or merging into FedEx or RPS, pursuant to a transaction in
which capital stock of FedEx or RPS then outstanding (other than capital stock
held by FedEx or RPS, respectively, or capital stock held by any such Person
which is a party to such consolidation or merger) is changed or exchanged unless
FedEx or RPS, as the case may be, is the surviving entity and no Default or
Unmatured Default shall occur upon giving effect to such consolidation or
merger; (5) the Borrower, in one transaction or a series of related
transactions, conveying,
12
transferring or leasing, directly or indirectly, all or substantially all of the
assets of the Borrower and its Subsidiaries taken as a whole, or of FedEx or RPS
(other than to a Wholly-Owned Subsidiary of the Borrower); (6) the Borrower and
one or more of its Wholly-Owned Subsidiaries ceasing to own and control eighty
percent (80%) of the issued and outstanding capital stock of FedEx and RPS; or
(7) the Borrower or any of its Subsidiaries paying or effecting a dividend or
distribution (including by way of recapitalization or reclassification) in
respect of its capital stock (other than solely to the Borrower or any of its
Wholly-Owned Subsidiaries and other than solely for capital stock of the
Borrower), or purchasing, redeeming, retiring, exchanging or otherwise acquiring
for value any of its capital stock (other than solely from the Borrower or any
of its Wholly-Owned Subsidiaries and other than solely for capital stock of the
Borrower), if the cash and Fair Market Value of the securities and assets paid
or distributed in connection therewith (determined on the record date for such
dividend or distribution or the effective date for such purchase, redemption,
retirement, exchange or other acquisition), together with the cash and Fair
Market Value of the securities and assets paid or distributed in connection with
all other such dividends, distributions, purchases, redemptions, retirements,
exchanges and acquisitions effected within the 12-month period preceding the
record date for such dividend or distribution or the effective date for such
purchase, redemption, retirement, exchange or other acquisition (determined on
the respective record or effective dates for such other dividends,
distributions, purchases, redemptions, retirements, exchanges and acquisitions),
exceeds 30 percent of the aggregate Fair Market Value of all capital stock of
the Borrower outstanding on the record date for such dividend or distribution or
the effective date for such purchase, redemption, retirement, exchange or other
acquisition (determined on such record or effective date).
"RPS" means RPS, Inc., a Delaware corporation.
"S&P" means Standard & Poor's Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇,
Inc., or, if S&P shall cease rating Indebtedness of the Borrower and FedEx and
its ratings business with respect to Indebtedness of the Borrower and FedEx
shall have been transferred to a successor Person, such successor Person;
provided, however, that if S&P ceases rating securities similar to Indebtedness
of the Borrower and FedEx and its ratings business with respect to such
securities shall not have been transferred to any successor Person, then "S&P"
shall mean any other nationally recognized rating agency (other than Moody's)
selected by the Borrower that rates any Indebtedness of the Borrower and FedEx.
"S&P Rating" means, at any particular time, the higher of the ratings
issued by S&P with respect to the Borrower's or FedEx's senior unsecured long-
term public debt.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Significant Subsidiary" means, during each fiscal year of the Borrower,
any Subsidiary of the Borrower which had revenues (determined in accordance with
GAAP) for the immediately preceding fiscal year of the Borrower in excess of
2.0% of the consolidated revenues (determined in accordance with GAAP) of the
Borrower and the Consolidated Subsidiaries for such immediately preceding fiscal
year.
13
"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.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding Voting Stock 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 partnership,
association, joint venture or similar business organization more than 50% of the
ownership interests having power to direct the ordinary affairs thereof of which
shall at the time be so owned or controlled. Unless otherwise expressly
provided, all references herein to a "Subsidiary" shall mean a Subsidiary of the
Borrower.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made (or of the consolidated assets of FedEx and its
Subsidiaries, as would be shown in the consolidated financial statements of
FedEx and its Subsidiaries, in the case of financial statements dated prior to
the date the Borrower was established as the parent of FedEx), or (ii) is
responsible for more than 10% of the consolidated net sales or of the
consolidated net income of the Borrower and its Subsidiaries (or of FedEx and
its Subsidiaries) as reflected in the financial statements referred to in clause
(i) above.
"Tranche A Commitment" means, with respect to each Lender, the obligation
of such Lender to make Tranche A Loans not exceeding the amount set forth
opposite its signature below, as such amount may be modified from time to time
pursuant to the terms hereof.
"Tranche A Facility" means the Tranche A Commitments and the Tranche A
Loans.
"Tranche A Facility Termination Date" means five (5) years after the
Effective Date, or any earlier date on which the Tranche A Commitments are
canceled by the Borrower or otherwise terminated pursuant to this Agreement.
"Tranche A Loan" means each loan made pursuant to Section 2.1(a).
"Tranche B Commitment" means, with respect to each Lender, the obligation
of such Lender to make Tranche B Loans not exceeding the amount set forth
opposite its signature below, as such amount may be modified from time to time
pursuant to the terms hereof.
"Tranche B Facility" means the Tranche B Commitments and the Tranche B
Loans.
"Tranche B Facility Termination Date" means January 14, 1999, any earlier
date on which the Tranche B Commitments are canceled by the Borrower or
otherwise terminated pursuant to this Agreement, or any later date to which the
Tranche B Facility Termination Date may be extended pursuant to Section 2.19
hereof.
14
"Tranche B Loan" means each loan made pursuant to Section 2.1(b).
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested nonforfeitable benefits under all Single Employer Plans 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.
"Voting Stock" means all outstanding shares of capital stock of the
Borrower entitled to vote generally in the election of directors.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which 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 Person 100% of the ownership interests having ordinary
voting power of which shall at the time be so owned or controlled.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. COMMITMENTS. (a) From and including the date of this Agreement and
prior to the Tranche A Facility Termination Date, each Lender severally agrees,
on the terms and conditions set forth in this Agreement, to make Tranche A Loans
to the Borrower from time to time in amounts not to exceed in the aggregate at
any one time outstanding the amount of its Tranche A Commitment. Subject to the
terms of this Agreement, the Borrower may borrow, repay and reborrow Tranche A
Loans at any time prior to the Tranche A Facility Termination Date. The Tranche
A Commitments shall expire on the Tranche A Facility Termination Date.
(b) From and including the date of this Agreement and prior to the
Tranche B Facility Termination Date, each Lender severally agrees, on the terms
and conditions set forth in this Agreement, to make Tranche B Loans to the
Borrower from time to time in amounts not to exceed in the aggregate at any one
time outstanding the amount of its Tranche B Commitment. Subject to the terms
of this Agreement, the Borrower may borrow, repay and reborrow Tranche
15
B Loans at any time prior to the Tranche B Facility Termination Date. The
Tranche B Commitments shall expire on the Tranche B Facility Termination Date.
2.2. MANDATORY PAYMENTS. (a) The Borrower will promptly give notice
to the Agent and the Lenders of the occurrence of a Restructuring Event. If,
within 30 days after the later of the occurrence of a Restructuring Event or the
date on which the Agent and the Lenders have received notice from the Borrower
that a Restructuring Event has occurred, the Agent on behalf of the Required
Lenders notifies the Borrower in writing that the Required Lenders desire the
prepayment and cancellation of this Agreement (such notice hereinafter a
"Cancellation Notice"), then (i) the Borrower shall within 30 days after its
receipt of such Cancellation Notice prepay in full the entire outstanding
principal amount of the Loans, if any, and all of the other Obligations, and
(ii) on the earlier of (1) the date that the Borrower prepays the Loans and all
of the other Obligations pursuant to clause (i) of this sentence, or (2) the
30th day after the Borrower receives such Cancellation Notice, the outstanding
balance of the Loans and all other Obligations shall mature and be due and
payable in full and the Aggregate Commitment and the Commitments of each Lender
shall be automatically and permanently terminated and reduced to zero. As of
the date of such Cancellation Notice, the Borrower shall no longer be permitted
to borrow additional Advances under this Agreement.
(b) The Borrower unconditionally promises to pay the unpaid principal
amount of each Tranche A Loan on the Tranche A Facility Termination Date and
the unpaid principal amount of each Tranche B Loan on the Tranche B Facility
Termination Date. The Borrower also unconditionally promises to pay all
other Obligations on the Tranche A Facility Termination Date.
2.3. RATABLE LOANS; TYPES OF ADVANCES. Each Advance hereunder shall
consist of Tranche A Loans or Tranche B Loans made from the several Lenders
ratably in proportion to the ratio that their respective Commitments bear to the
Aggregate Commitment. The Advances 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. Not more than fifteen Eurodollar Advances may be
outstanding at any one time.
2.4. DETERMINATION OF LEVELS. The applicable Level of each Rating will
be determined as set forth in the respective definitions of each Level unless
there is a split between the S&P Rating and the ▇▇▇▇▇'▇ Rating. If there is a
split in the Ratings, the higher of the Ratings will determine the applicable
Level except as provided in the following sentence. If there is a split of two
or more ratings, the applicable Level will be determined as set forth in the
respective definition of each Level except that for purposes of applying such
definitions the higher of the two Ratings will be deemed to be reduced to the
Rating that is one Rating below the actual Rating.
2.5. FACILITY FEES; AGENT'S FEE; REDUCTIONS IN AGGREGATE COMMITMENT.
(a) The Borrower agrees to pay to the Agent for the account of each Lender a
facility fee on the daily amount of such Lender's Tranche A Commitment from the
Effective Date to and including the Tranche A Facility Termination Date at a per
annum rate equal to the Applicable Tranche A Facility Fee Percentage. Such
facility fee shall be payable on each Payment Date hereafter and on the Tranche
A Facility Termination Date.
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(b) The Borrower agrees to pay to the Agent for the account of each
Lender a facility fee on the daily amount of such Lender's Tranche B Commitment
from the Effective Date to and including the Tranche B Facility Termination Date
at a per annum rate equal to the Applicable Tranche B Facility Fee Percentage.
Such facility fee shall be payable on each Payment Date hereafter and on the
Tranche B Facility Termination Date.
(c) The Borrower shall pay to the Agent as compensation for its
services hereunder the fees specified in the letter agreement dated November 17,
1997, between the Agent and the Borrower, as it may be amended or supplemented
from time to time.
(d) The Borrower may permanently reduce the Aggregate Commitment in
whole, or in part ratably among the Lenders, in the minimum amount of
$20,000,000 and in integral multiples of $10,000,000 in excess thereof, upon at
least ten Business Days' written notice to the Agent, which notice shall specify
the amount of any such reduction, provided, however, that the amount of the
Aggregate Commitment may not be reduced below the aggregate principal amount of
the outstanding Advances. Any such reduction shall be applied ratably to the
Aggregate Tranche A Commitment and the Aggregate Tranche B Commitment. All
accrued facility fees shall be payable on the effective date of any termination
of the obligations of the Lenders to make Loans hereunder.
2.6. MINIMUM AMOUNT OF EACH ADVANCE. Each Advance shall be in the
minimum amount of $5,000,000 (and in integral multiples of $1,000,000 if in
excess thereof), provided, however, that any Floating Rate Advance may be in the
amount of the unused Aggregate Tranche A Commitment or the Aggregate Tranche B
Commitment, as the case may be.
2.7. OPTIONAL PRINCIPAL PAYMENTS. The Borrower may from time to time
pay, without penalty or premium, all outstanding Floating Rate Advances, or, in
a minimum aggregate amount of $5,000,000 or any integral multiple thereof, any
portion of the outstanding Floating Rate Advances upon one Business Day's prior
notice to the Agent. A Eurodollar Advance may not be paid prior to the last day
of the applicable Interest Period except pursuant to an acceleration or a
mandatory prepayment in accordance with this Agreement.
2.8. METHOD OF SELECTING TYPES AND INTEREST PERIODS FOR NEW ADVANCES.
The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable to each Advance from time to
time. The Borrower shall give the Agent irrevocable notice (a "Borrowing
Notice") not later than 10:00 a.m. (Chicago time) on the Borrowing Date of each
Floating Rate Advance, and at least 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 and whether such Advance shall
consist of Tranche A Loans or Tranche B Loans,
17
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than noon (Chicago time) on each Borrowing Date, each Lender shall
make available its Loan or Loans, in funds immediately available in Chicago to
the Agent at its address specified pursuant to Article XIII. Upon satisfaction
or waiver in accordance with the terms of this Agreement of the applicable
conditions precedent set forth in Article IV, the Agent will make the funds so
received from the Lenders available to the Borrower at the 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
of any Type shall continue as a Eurodollar Advance of such Type until the end of
the then applicable 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 Agent a Conversion/Continuation Notice requesting
that, at the end of such Interest Period, such Eurodollar Advance shall either
continue as a Eurodollar Advance of such Type for the same or another Interest
Period or be converted into a Floating Rate Advance. 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 into any other Type or Types of Advances; provided
that any conversion of any Eurodollar Advance shall be made on, and only on, the
last day of the Interest Period applicable thereto. The Borrower shall give the
Agent irrevocable notice (a "Conversion/Continuation Notice") of each conversion
of an Advance or continuation of a Eurodollar Advance not later than 10:00 a.m.
(Chicago time) on the date of the requested conversion, in the case of a
conversion of any Advance into a Floating Rate Advance, or at least three
Business Days prior to the date of the requested conversion or continuation, in
the case of a conversion into or continuation of a Eurodollar Advance,
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 whether such Advance consists of
Tranche A Loans or Tranche B Loans; 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 Interest
Period applicable thereto.
2.10. INTEREST. 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 hereof, at a rate
per annum equal to the Floating Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as a Floating Rate Advance
will take
18
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 a rate per annum equal to the Eurodollar Rate applicable
thereto. No Interest Period for any Tranche A Loans may end after the Tranche A
Facility Termination Date, and no Interest Period for any Tranche B Loans may
end after the Tranche B Facility Termination Date.
2.11. RATES APPLICABLE AFTER MATURITY OF ADVANCES. Notwithstanding
anything to the contrary contained in Section 2.8 or 2.9, no Advance may be made
as, converted into or continued as a Eurodollar Advance (except with the consent
of the Required Lenders) when any Default or Unmatured Default has occurred and
is continuing. If any Advance is not paid at maturity, whether by acceleration
or otherwise, (i) each Eurodollar Advance shall bear interest for the remainder
of the applicable Interest Period at the rate otherwise applicable to such
Eurodollar Advance for such Interest Period plus 1% per annum and at the end of
each Interest Period shall automatically convert to a Floating Rate Advance
bearing interest in accordance with clause (ii) of this Section, and (ii) each
Floating Rate Advance shall bear interest at a rate per annum equal to the
Floating Rate otherwise applicable to the Floating Rate Advance plus 1% 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 Agent at the Agent's address specified pursuant to Article XIII, or
at any other Lending Installation of the Agent specified in writing by the Agent
to the Borrower, by noon (local time) on the date when due. Each such payment
shall be applied to any Advances and other amounts then due in accordance with
the written instructions from the Borrower to the Agent accompanying such
payment and shall be applied ratably by the Agent among the Lenders. Each
payment delivered to the Agent for the account of any Lender shall be delivered
promptly by the Agent to such Lender in the same type of funds that the Agent
received at such Lender's address specified pursuant to Article XIII or at any
Lending Installation specified in a notice received by the Agent from such
Lender. The Borrower authorizes the Agent to charge the Borrower's account
maintained with First Chicago for each payment of principal, interest and fees
as it becomes due hereunder.
2.13. EVIDENCE OF DEBT; TELEPHONIC NOTICES. (a) Each Lender shall
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.
(b) The Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Type thereof and the Interest Period, if
any, applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Agent hereunder for the account
of the Lenders and each Lender's share thereof.
(c) The entries made in the accounts maintained pursuant to subsections
(a) or (b) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; PROVIDED that the failure of any
Lender or the Agent to maintain such accounts or any
19
error therein shall not in any manner affect the obligation of the Borrower to
repay the Loans in accordance with the terms of this Agreement.
(d) Any Lender may request that the Tranche A Loans and Tranche B Loans
made by it each be evidenced by a promissory note. In such event, the Borrower
shall prepare, execute and deliver to such Lender two promissory notes, one for
Tranche A Loans and one for Tranche B Loans, each payable to the order of such
Lender (or, if requested by such Lender, to such Lender and its registered
assigns) and in a form approved by the Agent. Thereafter, the Loans evidenced
by such promissory notes and interest thereon shall at all times (including
after assignment pursuant to Section 12.3) be represented by one or more
promissory notes in such form payable to the order of the payee named therein
(or, if such promissory note is a registered note, to such payee and its
registered assigns).
(e) The Borrower authorizes the Lenders and the Agent to extend,
convert or continue Advances, effect selections of Types of Advances and to
transfer funds based on telephonic notices made by any person or persons the
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 Agent a
written confirmation of each telephonic notice signed by an Authorized Officer.
If the written confirmation differs in any material respect from the action
taken by the Agent and the Lenders, the records of the Agent and the Lenders
shall govern absent manifest error.
2.14. INTEREST PAYMENT DATES; INTEREST AND FEE BASIS. Interest accrued
on each Floating Rate Advance shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof, on any date on which
the Floating Rate Advance is prepaid, whether due to acceleration or otherwise,
and 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 date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Interest Period, on any date on which the 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 Eurodollar Advances shall be calculated for
actual days elapsed on the basis of a 360-day year. All other interest and fees
shall be calculated for actual days elapsed on the basis of a 365- or 366-day
year, as appropriate. Interest shall be payable for the day an Advance is made
but not for the day of any payment on the amount paid if payment is received
prior to noon (local time) at the place of payment. If any payment of principal
of or interest on an Advance shall become due on a day which is not a Business
Day, such payment shall be made on the next succeeding Business Day and, in the
case of a principal payment, such extension of time shall be included in
computing interest in connection with such payment.
2.15. NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND
COMMITMENT REDUCTIONS. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Conversion/Continuation Notice, and repayment notice received
by it hereunder. The Agent will notify each Lender of the
20
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 Lender agrees to furnish timely
information 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 Loans shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written notice to
the 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 AGENT. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The 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 or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the 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 Agent until the date the Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment 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, each Lender 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 Agent two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224, certifying in either case that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes. Each Lender which so
delivers a Form 1001 or 4224 further undertakes to deliver to each of the
Borrower and the 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 Agent, in
each case certifying that such Lender is entitled to receive payments under this
Agreement 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 from duly completing and delivering any such form with
respect to it and such Lender advises the Borrower and the Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax.
21
2.19. EXTENSION OF TRANCHE B FACILITY TERMINATION DATE. Not less than 60
days and not more than 90 days prior to the Tranche B Facility Termination Date
then in effect, provided that no Default or Unmatured Default shall have
occurred and be continuing, the Borrower may request an extension of such
Tranche B Facility Termination Date by submitting to the Agent a written request
therefor (an "Extension Request"), which the Agent shall promptly furnish to
each Lender. Each Lender shall, not less than 30 days and not more than 60 days
prior to the Tranche B Facility Termination Date then in effect, notify the
Borrower and the Agent of its election to extend or not extend the Tranche B
Facility Termination Date as requested by the Borrower. Notwithstanding any
provision of this Agreement to the contrary, any notice by any Lender of its
willingness to extend the Maturity Date shall be revocable by such Lender in its
sole and absolute discretion at any time prior to the date which is 30 days
prior to the Tranche B Facility Termination Date then in effect. If any Lender
shall approve in writing the extension of the Tranche B Facility Termination
Date requested in such Extension Request, the Tranche B Facility Termination
Date for such Lender's Tranche B Commitment shall automatically and without any
further action by any Person be extended for the period specified in such
Extension Request; provided that each extension pursuant to this Section 2.19
shall be for a maximum of 364 days. The Tranche B Commitment of any Lender that
does not consent in writing to such requested extension not less than 30 days
and not more than 60 days prior to the Maturity Date then in effect (an
"Objecting Lender") shall, unless earlier terminated in accordance with this
Agreement, expire on the Tranche B Facility Termination Date in effect on the
date of such Extension Request (such Tranche B Facility Termination Date, if
any, referred to as the "Commitment Expiration Date" with respect to such
Objecting Lender). If, not less than 30 days and not more than 60 days prior to
the Tranche B Facility Termination Date then in effect, no Lender shall approve
in writing the extension of the Tranche B Facility Termination Date requested in
an Extension Request, the Tranche B Facility Termination Date shall not be
extended pursuant to such Extension Request. The Administrative Agent shall
promptly notify (y) the Lenders and the Borrower of any extension of the Tranche
B Facility Termination Date pursuant to this Section 2.19 and (z) the Borrower
and any other Lender of any Lender which becomes an Objecting Lender. No Lender
shall be obligated to approve any extension of the Tranche B Facility
Termination Date.
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), or any interpretation thereof, or the compliance
of any Lender therewith,
(i) subjects any Lender or any applicable Lending Installation to any
tax, duty, charge or withholding on or from payments due from the
Borrower (excluding federal taxation of the overall net income of
any Lender or applicable Lending
22
Installation), or changes the basis of taxation of payments to any
Lender in respect of its Loans 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 or any applicable Lending Installation (other than
reserves and assessments taken into account in determining the
Eurodollar Rate), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of
making, funding or maintaining loans or reduces any amount
receivable by any Lender or any applicable Lending Installation in
connection with loans, or requires any Lender or any applicable
Lending Installation to make any payment calculated by reference to
the amount of loans held or interest received by it, by an amount
deemed material by such Lender,
then, within 15 days after demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an amount
received which such Lender determines is attributable to making, funding and
maintaining its Loans and its Commitments.
3.2. CHANGES IN CAPITAL ADEQUACY REGULATIONS. If a Lender determines
that the amount of capital required or expected to be maintained by such Lender,
any Lending Installation of such Lender or any corporation controlling such
Lender is increased as a result of a Change, then, within 15 days after demand
by such Lender, the Borrower shall pay such Lender the amount necessary to
compensate such Lender for any shortfall in the rate of return on the portion of
such increased capital which such Lender determines is attributable to this
Agreement, its Loans or its obligation to make Loans hereunder (after taking
into account such Lender'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, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or
directive (whether or 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 or any Lending Installation or any corporation
controlling any Lender. "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.
3.3. AVAILABILITY OF TYPES OF ADVANCES. If any Lender determines that
maintenance 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, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances
23
are not available or (ii) the interest rate applicable to a Eurodollar Advance
does not accurately reflect the cost of making or maintaining such Advance, then
the Agent shall suspend the availability of Eurodollar Advances and require any
Eurodollar Advances to be converted to Floating Rate Advances.
3.4. FUNDING INDEMNIFICATION. If any payment or conversion of a
Eurodollar Advance occurs on a date which is not the last day of the applicable
Interest Period, whether because of acceleration, prepayment or otherwise, or a
Eurodollar Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each
Lender 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 the Eurodollar Advance.
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 Eurodollar
Advances under Section 3.3, so long as such designation is not disadvantageous
to such Lender as determined by such Lender in its sole discretion. Each Lender
shall deliver a written statement of such Lender as to the amount due, if any,
under Section 3.1, 3.2 or 3.4. Such written statement shall set forth in
reasonable detail the calculations upon which such 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 shall be calculated as though each Lender
funded its Eurodollar 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 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.
ARTICLE IV
CONDITIONS PRECEDENT
4.1. CLOSING. Lenders shall not be required to make the initial
Advance hereunder unless (a) on or before the Effective Date the Agent shall
have received, with sufficient copies for the Lenders:
(i) Counterpart signature pages of this Agreement executed by each
party hereto;
(ii) Counterparts of the Guaranty, executed by each Guarantor;
24
(iii) Copies of the charter of the Borrower and each Guarantor, together
with all amendments, and a certificate of good standing for each
such Person, all certified on or within 15 days prior to the
Effective Date by the appropriate governmental officer in such
Person's jurisdiction of incorporation;
(iv) Copies, certified as of the Effective Date by the Secretary or
Assistant Secretary of the Borrower and each Guarantor, 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 any Lender) authorizing the execution, delivery, and
performance of the Loan Documents;
(v) Incumbency certificates, executed as of the Effective Date by the
Secretary or Assistant Secretary of the Borrower and each
Guarantor, which shall identify by name and title and bear the
signature of the officers of the Borrower or such Guarantor, as the
case may be, authorized to sign the Loan Documents and to make
borrowings hereunder, upon which certificate the Agent and the
Lenders shall be entitled to rely until informed of any change in
writing by the Borrower;
(vi) A certificate, dated the Effective Date, signed by the Chief
Financial Officer or Treasurer of the Borrower, stating that on
such date no Default or Unmatured Default has occurred and is
continuing;
(vii) A written opinion of the Borrower's counsel, addressed to the
Lenders in substantially the form of Exhibit "B" hereto. The
Borrower requests its counsel to issue such opinion;
(viii) Written money transfer instructions, in substantially the form of
Exhibit "D" hereto, addressed to the Agent and signed by an
Authorized Officer, together with such other related money transfer
authorizations as the Agent may have reasonably requested;
(ix) A written representation and warranty by the Borrower that, as of
the Effective Date, since May 31, 1997, there has been no change in
the business, Property, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its
Subsidiaries taken as a whole which could reasonably be expected to
have a Material Adverse Effect; and
(x) Such other documents as any Lender or its counsel may reasonably
request; and
(b) the following additional conditions precedent have been satisfied:
(i) the Borrower shall have consummated its acquisition of Caliber;
(ii) FedEx shall have terminated that certain Amended and Restated
Credit Agreement dated as of May 12, 1995 (the "1995 Credit
Agreement"), among
25
FedEx, the lenders parties thereto and First Chicago, as agent for
such Lenders (which Lenders constitute the "Required Lenders" under
the 1995 Credit Agreement) in accordance with Article XV; and
(iii) Caliber shall have terminated that certain Credit Agreement dated
as of March 24, 1995, as amended, among Caliber, the lenders
parties thereto and The Chase Manhattan Bank (formerly known as
Chemical Bank), as Agent, and shall have repaid all principal,
interest and other amounts owing thereunder.
4.2. EACH ADVANCE. The Lenders shall not be required to make any
Advance, unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default and no Default or
Unmatured Default shall occur upon giving effect to the application
of the proceeds of such Advance.
(ii) The representations and warranties contained in Article V are true
and correct as of such Borrowing Date except for changes in the
Schedules hereto reflecting transactions permitted by this
Agreement.
(iii) All legal matters incident to the making of such Advance shall be
satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute a
representation and warranty by the Borrower that the conditions contained in
Sections 4.2(i) and (ii) have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1. CORPORATE EXISTENCE AND STANDING. Each of the Borrower, each of
the Guarantors and each of the Significant Subsidiaries is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all requisite authority to conduct its
business in each jurisdiction in which its business is conducted and where the
failure to have such requisite authority would have a material adverse effect on
the business of the Borrower, the Guarantors and the Significant Subsidiaries
taken as a whole.
5.2. AUTHORIZATION AND VALIDITY. The Borrower and each of the
Guarantors has the corporate power and authority and legal right to execute and
deliver the Loan Documents executed by it and to perform its obligations
thereunder. The execution and delivery by the
26
Borrower and the Guarantors of the Loan Documents and the performance of their
respective obligations thereunder have been duly authorized by proper corporate
proceedings, and the Loan Documents constitute legal, valid and binding
obligations of the Borrower and the Guarantors, enforceable in accordance with
their respective terms, except as enforceability may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and subject also to the availability of equitable remedies if
equitable remedies are sought.
5.3. NO CONFLICT; GOVERNMENT CONSENT. Neither the Borrower's nor any
Guarantor's execution and delivery of the Loan Documents, nor the consummation
of the transactions therein contemplated, nor compliance with the provisions
thereof will violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower, any Guarantor or any of the
Significant Subsidiaries or the Borrower's, any Guarantor's or any Significant
Subsidiary's articles or certificate of incorporation or by-laws or the
provisions of any material indenture, instrument or agreement to which the
Borrower, any Guarantor or any of the Significant 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, any Guarantor or any Significant
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 or public body
or authority, or any subdivision thereof, is required to authorize, or is
required in connection with the execution, delivery and performance of, or the
legality, validity, binding effect or enforceability of, any of the Loan
Documents.
5.4. FINANCIAL STATEMENTS. The May 31, 1997 audited consolidated
financial statements and August 31, 1997 unaudited consolidated financial
statements of FedEx and its Consolidated Subsidiaries heretofore delivered to
the Lenders were prepared in accordance with GAAP in effect on the dates such
statements were prepared and fairly present the consolidated financial
condition and operations of FedEx and its Consolidated Subsidiaries at such
dates and the consolidated results of their operations for the periods then
ended (except, in the case of such unaudited statements, for normal year-end
adjustments). The December 31, 1996 audited consolidated financial
statements and September 30, 1997 unaudited consolidated financial statements
of Caliber and its consolidated Subsidiaries heretofore delivered to the
Lenders were prepared in accordance with GAAP in effect on the dates such
statements were prepared and fairly present the consolidated financial
condition and operations of Caliber and its consolidated Subsidiaries at such
dates and the consolidated results of their operations for the periods then
ended (except, in the case of such unaudited statements, for normal year-end
adjustments).
5.5. TAXES. The Borrower and its Significant Subsidiaries have filed
all United States federal tax returns and all other material 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 Significant
Subsidiaries, except such taxes, if any, as are being contested in good faith
and as to which adequate reserves determined in accordance with GAAP have been
provided. The charges, accruals and reserves on the books of the Borrower and
its Significant Subsidiaries in respect of any taxes or other governmental
charges are adequate.
27
5.6. LITIGATION AND CONTINGENT OBLIGATIONS. Except for such matters as
are referenced in the form of opinion of counsel attached hereto as Exhibit "B",
there is no litigation, arbitration, governmental investigation, proceeding or
inquiry pending or, to the knowledge of any of their officers, threatened
against or affecting the Borrower or any of its Significant Subsidiaries which
could reasonably be expected to have a Material Adverse Effect. Other than any
liability incident to such litigation, arbitration or proceedings, the Borrower
and its Significant Subsidiaries have no material contingent obligations not
provided for or disclosed in the financial statements referred to in Section
5.4.
5.7. SUBSIDIARIES. Schedule "1" hereto contains an accurate list of all
of the presently existing Significant Subsidiaries of the Borrower, 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.
5.8. ERISA. The Unfunded Liabilities of all Single Employer Plans do
not in the aggregate exceed $80,000,000. Each Plan complies in all material
respects with all applicable requirements of law and regulations, no Reportable
Event has occurred with respect to any Plan, neither the Borrower nor any other
member of the Controlled Group has withdrawn from any Plan or initiated steps to
do so, and no steps have been taken to reorganize or terminate any Plan.
5.9. ACCURACY OF INFORMATION. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading.
5.10. Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of the value of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale or pledge, or any other
restriction, hereunder.
5.11. MATERIAL AGREEMENTS. Neither the Borrower nor any Subsidiary is a
party to any agreement (including, without limitation, this 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 any agreement to
which it is a party, which default could reasonably be expected to have a
Material Adverse Effect.
5.12. COMPLIANCE WITH LAWS. The Borrower and its Subsidiaries have
complied in all material respects with all applicable statutes, rules,
regulations, orders and restrictions of any domestic or foreign government or
any instrumentality or agency thereof, having jurisdiction over the conduct of
their respective businesses or the ownership of their respective Property.
Neither the Borrower nor any Subsidiary has received any notice to the effect,
nor does any Authorized Officer have any actual knowledge, that its operations
are not in material compliance with any of the requirements of applicable
federal, state and local environmental, health and safety statutes
28
and regulations or the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a release of any 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.
5.13. EXISTING LIENS. None of the assets of the Borrower or any of its
Subsidiaries is subject to any Lien other than those permitted by Section 6.19.
5.14. 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.
5.15. CITIZENSHIP. FedEx is a citizen of the United States, as defined
in 49 U.S.C. Section 40102(a)(15) (a "Citizen"). Each other Subsidiary that
must be a Citizen in order to conduct its business as currently conducted is a
Citizen. Neither FedEx nor any such other Subsidiary is a national of any
foreign country designated in Presidential Executive Order No. 8389 or 9193, as
amended, and the regulations issued thereunder, as amended, or a national of any
foreign country designated in the Foreign Assets Control Regulations or in the
Cuban Assets Control Regulations of the United States Treasury Department, 31
C.F.R., Chapter V, as amended.
5.16. STATUS AS AIR CARRIER. FedEx, and each other Subsidiary that must
be so authorized in order to conduct its business as currently conducted, (i) is
authorized to engage in all cargo domestic and international air service under
certificates issued pursuant to 49 U.S.C. Section 41103 and 49 U.S.C. Section
41102(a), respectively, and (ii) is the holder of a valid and effective
operating certificate issued by the FAA pursuant to Part 121 of the Federal
Aviation Regulations. Such certificates are in full force and effect and are
adequate for the conduct of the business of the Borrower and its Subsidiaries as
now conducted. There are no actions, proceedings or investigations pending or,
to the knowledge of any of its officers, threatened (or any basis therefor known
to the Borrower) to amend, modify, suspend or revoke any such certificate in
whole or in part, which would have any material adverse effect on any such
certificate or any of the operations of the Borrower or its Subsidiaries.
5.17. PARI PASSU. All the payment obligations of the Borrower and the
Guarantors arising under or pursuant to the Loan Documents will at all times
rank pari passu with all other unsecured and unsubordinated payment obligations
and liabilities (including contingent obligations and liabilities) of the
Borrower and the Guarantors (other than those which are mandatorily preferred by
laws or regulations of general application).
29
ARTICLE VI
COVENANTS
During the term of this Agreement and so long as any Obligations are
outstanding or any Commitment is in effect hereunder, unless the Required
Lenders shall otherwise consent in writing:
6.1. FINANCIAL REPORTING. The Borrower will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with GAAP, and furnish to the Lenders:
(i) Within 90 days after the close of each of its fiscal years, an
unqualified audit report certified by independent certified public
accountants of recognized national standing acceptable to the
Lenders, prepared in accordance with GAAP on a consolidated basis
for itself and the Consolidated Subsidiaries, including a balance
sheet as of the end of such period, related profit and loss and
reconciliation of surplus statements, and a statement of cash
flows, accompanied by (a) any management letter prepared by said
accountants, and (b) 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) Within 45 calendar days after the end of each of the first three
quarters of each fiscal year of the Borrower, for itself and the
Consolidated Subsidiaries, an unaudited consolidated balance sheet
as at the close of such period and consolidated profit and loss and
reconciliation of surplus statements and a statement of cash flows
for the period from the beginning of such fiscal year to the end of
such quarter, all certified as complete and accurate and prepared
in accordance with GAAP by its Chief Financial Officer, Treasurer
or Controller.
(iii) Together with the financial statements required hereunder, a
certificate signed by its Chief Financial Officer or Treasurer
stating that no Default or Unmatured Default exists, or if any
Default or Unmatured Default exists, stating the nature and status
thereof, and stating the steps the Borrower is taking to cure such
Default or Unmatured Default.
(iv) As soon as available, and in any event within 45 calendar days
after the end of each of the first three quarters of each fiscal
year of the Borrower and within 90 calendar days after the end of
the fourth quarter of each fiscal year of the Borrower, a schedule
in substantially the form of Schedule "2" hereto, certified as
accurate by the Borrower's Chief Financial Officer, Treasurer or
Controller, showing, as of the end of such quarter, the Borrower's
calculation, in form and
30
detail satisfactory to the Agent, of the calculations required to
be made to determine compliance with each of Sections 6.12 and
6.13.
(v) Promptly upon becoming available, copies of:
(a) All financial statements, reports, notices and proxy
statements sent by the Borrower, any Guarantor or any
Significant Subsidiary to its public stockholders (if
any).
(b) All prospectuses (other than on Form S-8 or a similar
form) of the Borrower or any Consolidated Subsidiary
filed with the Securities and Exchange Commission or
any other governmental agency succeeding to the
jurisdiction thereof.
(c) All regular and periodic reports filed by the Borrower
or any Consolidated Subsidiary with any securities
exchange or with the Securities and Exchange Commission
or any other governmental agency succeeding to the
jurisdiction thereof.
(vi) As soon as possible and in any event within 10 days after receipt
by the Borrower, 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 toxic or hazardous waste
or substance into the environment, and (b) any notice alleging any
violation of any federal, state or local environmental, health or
safety law or regulation by the Borrower or any of its
Subsidiaries, which, in either case, could reasonably be expected
to have a Material Adverse Effect.
(vii) Such other information (including non-financial information) as the
Agent or any Lender 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 Advances as liquidity support for the issuance of
commercial paper by the Borrower, for Acquisitions not prohibited under the
following sentence, for general corporate purposes and working capital of the
Borrower and its Subsidiaries, and to repay outstanding Advances. The Borrower
will not, nor will it permit any Subsidiary to, use any of the proceeds of the
Advances to purchase or carry any "margin stock" (as defined in Regulation U) or
to make any Acquisition which has not been approved or consented to by the board
of directors or equivalent governing body of the Person whose assets or equity
interests are to be acquired.
6.3. NOTICE OF DEFAULT. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders of the occurrence of
any Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
31
6.4. CONDUCT OF BUSINESS. Except as permitted by Sections 6.15 and
6.16, the Borrower will, and will cause each Guarantor and Significant
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and to do all things necessary to remain duly incorporated, validly
existing and in good standing as a domestic corporation in its jurisdiction of
incorporation and maintain all requisite authority to conduct its business in
each jurisdiction in which its business is conducted and where the failure to
have such requisite authority could reasonably be expected to have a Material
Adverse Effect.
6.5. CITIZENSHIP AND REGULATORY CERTIFICATES. The Borrower will cause
FedEx and each other applicable Subsidiary to continue to be (a) a citizen of
the United States, as defined in 49 U.S.C. Section 40102(a)(15), (b) authorized
to engage in all cargo domestic and international air service under certificates
issued pursuant to 49 U.S.C. Section 41103 and 49 U.S.C. Section 41102(a),
respectively, (c) the holder of all other certificates, rights, permits,
franchises and concessions from appropriate governments or governmental
authorities necessary or appropriate to enable the Borrower and its Subsidiaries
to conduct their business in all material respects as presently being conducted,
and (d) the holder of a valid and effective operating certificate issued by the
FAA pursuant to Part 121 of the Federal Aviation Regulations. The Borrower
will, and will cause each of its Subsidiaries to, use its best efforts to
maintain, preserve and keep in full force and effect its certificates, rights,
permits, franchises and concessions from appropriate governments or governmental
authorities and use its best efforts from time to time to obtain appropriate
renewals or replacements, provided, that nothing in this Section 6.5 shall
prevent the Borrower or any of its Subsidiaries from abandoning, or permitting
the amendment, expiration or termination of, any such certificate, right,
permit, franchise or concession if, in the opinion of the Borrower, such
abandonment, amendment, expiration or termination is in the interest of the
Borrower and not prejudicial in any material respect to the Lenders.
6.6. PAYMENT OF TAXES. The Borrower will, and will cause each
Subsidiary to, pay and discharge all taxes, assessments and governmental charges
or levies imposed upon it or upon its income or profits, or upon any property
belonging to it, and all lawful claims which, if unpaid, would become a Lien,
except where failure to do any of the foregoing would not have a Material
Adverse Effect and provided that neither the Borrower nor a Subsidiary shall be
required to pay any such tax, assessment, charge, levy or claim the payment of
which is being contested in good faith and by appropriate proceedings; and make
monthly accruals of all of the estimated liability of the Borrower and
Subsidiaries for such taxes, assessments, charges and levies, determined in
accordance with GAAP, and establish adequate reserves determined in accordance
with GAAP, for such thereof as may be contested, and reflect such accruals and
reserves in all financial statements furnished hereunder.
6.7. INSURANCE. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all its respective Property in such amounts and covering such risks as is
consistent with sound business practice, and the Borrower will furnish to any
Lender upon request full information as to the insurance carried.
32
6.8. COMPLIANCE WITH LAWS. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except
where failure to do so could not reasonably be expected to have a Material
Adverse Effect.
6.9. MAINTENANCE OF PROPERTIES. The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its 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, except where
failure to do any of the foregoing could not reasonably be expected to have a
Material Adverse Effect.
6.10. INSPECTION. The Borrower will, and will cause each Subsidiary to,
permit the Lenders, by their respective representatives and agents, to inspect
any of the Property, corporate books and financial records of the Borrower and
each Subsidiary, to examine and make copies of the books of accounts and other
financial records of the Borrower and each Subsidiary, and to discuss the
affairs, finances and accounts of the Borrower and each Subsidiary with, and to
be advised as to the same by, their respective officers at such reasonable times
and intervals as the Lenders may designate upon reasonable notice to the
Borrower.
6.11. DIVIDEND DECLARATIONS. The Borrower will not, nor will it permit
any Consolidated Subsidiary to, declare any dividend on any of its shares
payable more than 60 calendar days after the declaration date.
6.12. LEVERAGE. The Borrower will maintain at all times a ratio of (i)
the sum of (a) the aggregate unpaid principal amount of all outstanding Funded
Debt, plus (b) Capitalized Operating Lease Value, to (ii) the sum of (a) the
items listed in clause (i) above plus (b) Consolidated Adjusted Net Worth, of
not more than .70 to l.
6.13. FIXED CHARGE COVERAGE. The Borrower will at all times maintain a
ratio of (a) Consolidated Cash Flow to (b) the sum of Interest Expense and Rent
Expense, in an amount not less than 1.20 to 1 through February 28, 1999, and
1.25 to 1 thereafter.
6.14. RESTRICTED INVESTMENTS. The Borrower will not, nor will it permit
any Consolidated Subsidiary to, make any Restricted Investment except
Restricted Investments made by the Borrower or a Consolidated Subsidiary
provided that, after giving effect to any such Restricted Investment, (i) the
aggregate amount of all such Restricted Investments existing on the date of such
proposed action shall not exceed (x) $750,000,000 plus (y) 75% (or in the case
of a deficit, minus 100%) of the Consolidated Net Income for the period
commencing on June 1, 1997 and ending on and including the date of any such
proposed action (the "Computation Period") plus (z) the aggregate amount of the
net cash proceeds received by the Borrower during the Computation Period from
the sale of its stock and Indebtedness of the Borrower convertible into stock of
the Borrower (but only to the extent that any such Indebtedness has been
converted into shares of such stock during such period), and (ii) there shall
exist no Default or Unmatured Default.
33
6.15. MERGER AND CONSOLIDATION. The Borrower will not, nor will it
permit any Consolidated Subsidiary to, merge or consolidate with or into or
enter into any analogous reorganization or transaction with any other Person,
except
(a) Any Consolidated Subsidiary or other corporation may merge or
consolidate with the Borrower, provided that, after giving effect to any
such merger or consolidation, (i) the Borrower shall be the continuing or
surviving corporation and (ii) no Default or Unmatured Default shall exist,
(b) Any Wholly-Owned Subsidiary may merge with any other
Wholly-Owned Subsidiary,
(c) Any Consolidated Subsidiary other than FedEx or RPS may be
liquidated or dissolved,
(d) Any Consolidated Subsidiary may merge or consolidate with any
other Person, provided that, after giving effect to any such merger or
consolidation, no Default or Unmatured Default shall exist, and provided,
further, that, unless after giving effect to any such merger or
consolidation the Borrower owns, directly or indirectly, 100% of such
Consolidated Subsidiary, (i) such merger or consolidation shall be deemed
to be a sale of such Consolidated Subsidiary to such other Person pursuant
to either Section 6.16(c) or 6.16(e) (as appropriate under the terms of
Section 6.16) and (ii) such merger or consolidation shall be a violation of
this Section 6.15 unless such deemed sale is permitted by either Section
6.16(c) or 6.16(e) and the Borrower complies with all of the terms of
Section 6.16(c) or Section 6.16(e), as the case may be, regarding such
deemed sale, and
(e) Any other corporation may merge or consolidate with any
Consolidated Subsidiary, provided that, after giving effect to any such
merger or consolidation, (i) the continuing or surviving corporation shall
be a Consolidated Subsidiary, (ii) no Default or Unmatured Default shall
exist, and (iii) the Borrower owns, directly or indirectly, 100% of such
Consolidated Subsidiary.
6.16. SALES OF ASSETS. The Borrower will not, nor will it permit any
Consolidated Subsidiary to, sell, transfer, convey (including, without
limitation, any sale, transfer or conveyance related to a sale and leaseback
transaction but excluding sales of inventory in the ordinary course of business)
or lease (or enter into any commitment to sell, transfer, convey or lease) all
or any part of its assets (whether in one or a series of transactions) except
(a) Leases by the Borrower and Consolidated Subsidiaries of
Flight Equipment to others provided that the aggregate book value of all
Flight Equipment leased to any other Person or Persons by the Borrower or
any such Consolidated Subsidiary shall not at any time exceed $500,000,000;
(b) Sales of property by the Borrower or a Consolidated
Subsidiary provided that at the time of any such sale or other disposition
the Borrower or Consolidated
34
Subsidiary making such sale or disposition shall have previously acquired
or shall be simultaneously acquiring, in contemplation of such sale or
other disposition, substantially similar property, or shall have previously
entered into, or shall be simultaneously entering into, a binding purchase
agreement or purchase agreements to acquire substantially similar property,
which property is acquired within three years of such sale or other
disposition;
(c) Sales of property (other than sales of property permitted by
Section 6.16(e) but including any deemed sales of property pursuant to
Section 6.15(d)) determined by the Borrower to be surplus or obsolete
provided that the aggregate net book value of all such surplus or obsolete
property sold in any one fiscal year of the Borrower shall not exceed 12.5%
of Consolidated Adjusted Net Worth as of the last day of the fiscal year of
the Borrower immediately preceding the fiscal year of the Borrower during
which any such sale of assets shall take place;
(d) Sales of any property in order concurrently or subsequently
to lease as lessee such or similar property, provided that (i) any such
sale takes place within 360 days after (A) in the case of personal
property, the date on which the Borrower or the applicable Consolidated
Subsidiary acquired such property, and (B) in the case of real property or
fixtures, the later of the date on which the Borrower or the applicable
Consolidated Subsidiary acquired such property or the date on which
construction of all improvements on such property was completed, and (ii)
after giving effect to the creation of the Capitalized Lease Obligations,
if any, of the Borrower or a Consolidated Subsidiary resulting from the
lease of such property by the Borrower or a Consolidated Subsidiary, the
Borrower is in compliance with Section 6.12;
(e) Dispositions in connection with the restructuring at
Viking Freight, Inc. which was publicly announced prior to the date
hereof; and
(f) Sales of Property commonly known as "Federal Express
Stage 3 Kits" in accordance with FedEx's ordinary business practices.
6.17. LOANS, ADVANCES AND INVESTMENTS. The Borrower will not, nor will
it permit any Consolidated Subsidiary to, make or suffer to exist any
Investments, or commitments therefor, except
(a) Marketable direct obligations of the United States of
America, or an instrumentality or agency thereof, having a remaining
term to maturity of not more than one year;
(b) Certificates of deposit or other obligations having a
remaining term to maturity of not more than one year and issued by a
Lender, First Tennessee Bank, N.A., Union Planters National Bank of Memphis
or any other national or state bank or trust company having capital,
surplus and undivided profits in excess of $250,000,000 in the aggregate;
35
(c) Other certificates of deposit having a remaining term to
maturity of not more than one year and issued by a bank or other financial
institution approved in accordance with the Borrower's corporate investment
guidelines and procedures provided that the aggregate outstanding principal
amount of all such certificates of deposit shall not at any one time exceed
$1,000,000;
(d) Time deposits in any currency having a remaining term to
maturity of not more than one year and held by (i) foreign branches of
American banks, each such bank having capital, surplus and undivided
profits in excess of $250,000,000, or (ii) foreign banks, each such bank
having total capital, surplus and undivided profits in excess of
$250,000,000 or its equivalent in other currencies;
(e) For a period not in excess of one year, (i) marketable direct
obligations of the United States of America, or an instrumentality or
agency thereof, or (ii) instruments fully supported by marketable direct
obligations of the United States of America, or an instrumentality or
agency thereof, or (iii) open market commercial paper maturing within one
year after acquisition of such commercial paper, which is rated A1 or
better by S&P or P1 or better by ▇▇▇▇▇'▇; in each case, purchased by the
Borrower or a Consolidated Subsidiary and actually delivered to or held by
a Dealer for the account of the Borrower or a Consolidated Subsidiary under
a repurchase agreement with the Dealer from which such obligations or
commercial paper was purchased obligating such Dealer to repurchase such
obligations or commercial paper within fourteen calendar days after the
date of such repurchase agreement;
(f) Open-market commercial paper maturing within one year after
the acquisition thereof, which is rated A1 or better by S&P or P1 or better
by ▇▇▇▇▇'▇;
(g) Investments in the capital stock of a Consolidated
Subsidiary;
(h) Loans and advances by the Borrower to a Consolidated
Subsidiary;
(i) Loans and advances by a Consolidated Subsidiary to any other
Consolidated Subsidiary or to the Borrower;
(j) Investments in any Person not otherwise permitted by this
Section 6.17, which together with all other Investments at the time
outstanding under this Section 6.17(j), do not exceed 12.5% of Consolidated
Adjusted Net Worth provided that at least 66-2/3% of such Investments are
reasonably related to the same fields of enterprise as those in which the
Borrower and the Consolidated Subsidiaries are now engaged; and
(k) Restricted Investments made in compliance with Section 6.14.
In determining from time to time the amount of the Investments permitted by this
Section 6.17, loans and advances shall be taken at the principal amount thereof
then remaining unpaid at the
36
time of such determination and other Investments shall be taken at the original
cost thereof, regardless of any subsequent appreciation or depreciation therein.
6.18. CONTINGENT LIABILITIES. The Borrower will not, nor will it permit
any Consolidated Subsidiary to, assume, guarantee (including entering into any
contract which is, in economic effect, substantially equivalent to a guaranty),
endorse, contingently agree to purchase or to provide funds for the payment of,
agree to maintain the net worth or working capital or any other financial test
of, or otherwise become liable upon, any obligation of, any Person, except
(a) the Guaranties;
(b) By the endorsement of negotiable instruments for deposit or
collection (or similar transactions) in the ordinary course of business;
(c) Guaranties of customs fees in the ordinary course of
business; and
(d) Any other Contingent Obligation which after having given
effect thereto would not cause the Borrower to fail to be in compliance
with Section 6.12.
In determining from time to time the amount of guaranties and contingent
liabilities permitted by this Section 6.18, guaranties and contingent
liabilities shall be taken at the principal amount then remaining unpaid at the
time of such determination on the indebtedness and obligations so guaranteed or
related to such contingent liabilities.
6.19. LIENS. The Borrower will not, nor will it permit any
Consolidated Subsidiary to, create, incur, assume or suffer to exist, any
Lien, or enter into, or make any commitment to enter into, any arrangement
for the acquisition of any Property through conditional sales, lease-purchase
or other title retention agreement, except:
(a) Liens which may be hereafter created to secure payment of the
Obligations;
(b) Deposits or pledges, made in the ordinary course of business,
to secure payment of workers' compensation, unemployment insurance, old age
pensions or other social security obligations;
(c) Deposits or pledges, made in the ordinary course of business,
to secure performance of bids, tenders, contracts (other than contracts for
Indebtedness), leases, public or statutory obligations, surety bonds, or
other deposits or pledges for purposes of like general nature made in the
ordinary course of business;
(d) Deposits or pledges for the purpose of securing an appeal,
stay or discharge in the course of legal proceedings, or Liens for
judgments or awards which were not incurred in connection with Indebtedness
or the obtaining of advances or credits, provided such deposits, pledges
and Liens do not, in the aggregate for the Borrower and the Consolidated
Subsidiaries, materially detract from the value of their assets or
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properties or materially impair the use thereof in the ordinary course of
business and such appeal, judgment or award, as the case may be, is being
diligently contested or litigated in good faith by appropriate proceedings
being diligently conducted, and provided further there has been set aside
on the books of the Borrower or the Consolidated Subsidiaries, as the case
may be, reserves in accordance with GAAP with respect thereto, which
reserves shall be maintained until the related liabilities are paid or
otherwise discharged, and provided further execution is not levied upon any
such judgment or award;
(e) Liens for taxes, fees, assessments and governmental charges
not delinquent or which are being contested in good faith by appropriate
proceedings being diligently conducted, provided there has been set aside
on the books of the Borrower or the Consolidated Subsidiaries, as the case
may be, adequate reserves in accordance with GAAP with respect thereto,
which reserves shall be maintained until the related liabilities are paid
or otherwise discharged, and provided further, execution is not levied upon
any such Lien;
(f) Mechanics', carriers', workers', repairmen's or other like
Liens arising in the ordinary course of business securing obligations which
are not overdue for a period of more than 90 calendar days, or which are
being contested in good faith by appropriate proceedings being diligently
conducted provided there has been set aside on the books of the Borrower
and the Consolidated Subsidiaries, as the case may be, adequate reserves in
accordance with GAAP with respect thereto, which reserves shall be
maintained until the related liabilities are paid or otherwise discharged,
and provided further, execution is not levied upon any such Lien;
(g) Lessors' interests under Capitalized Leases;
(h) Liens on property acquired or constructed with the proceeds
of any tax-exempt airport bond financing;
(i) Liens securing Indebtedness of a Consolidated Subsidiary to
the Borrower;
(j) Liens existing on the property of a corporation or other
business entity immediately prior to its being consolidated with or merged
into the Borrower or a Consolidated Subsidiary or its becoming a
Consolidated Subsidiary, or Liens existing on any property acquired by the
Borrower or a Consolidated Subsidiary at the time such is so acquired
(whether or not the Indebtedness secured thereby shall have been assumed),
provided that (i) no such Lien was created or assumed in contemplation of
such consolidation or merger or such entity's becoming a Consolidated
Subsidiary or such acquisition of property and (ii) each such Lien shall
only cover the acquired property and, if required by the terms of the
instrument originally creating such Lien, property which is an improvement
to or is acquired for specific use in connection with such acquired
property;
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(k) Liens on Flight Equipment acquired on or after the date of
this Agreement which (i) secure the payment of all or any part of the
purchase price of such Flight Equipment or improvements thereon, (ii) are
limited to the Flight Equipment so acquired and improvements thereon, and
(iii) attach to such Flight Equipment within one year after the acquisition
or improvement of such Flight Equipment; and
(l) Liens not otherwise permitted by Sections 6.19(a) through (k)
provided that at all times the sum of (i) the aggregate principal amount of
all outstanding Long Term Debt of the Consolidated Subsidiaries (excluding
the Current Maturities of any such Long Term Debt and any Long Term Debt of
a Consolidated Subsidiary owing to the Borrower) which is unsecured, plus
(ii) the aggregate principal amount of all outstanding Long Term Debt of
the Borrower or any Consolidated Subsidiary (excluding the Current
Maturities of any such Long Term Debt and any Long Term Debt of a
Consolidated Subsidiary owing to the Borrower) which is secured as
permitted by this Section 6.19(l), does not exceed 8% of Consolidated
Adjusted Total Assets.
6.20. GUARANTIES. Within thirty (30) days after acquiring or
establishing any Subsidiary that constitutes a Significant Subsidiary upon its
acquisition or establishment or the consummation of any transactions
contemplated at the time of its establishment, the Borrower shall cause such
Significant Subsidiary to execute the Guaranty pursuant to an Addendum thereto
in the form of Annex I to the Guaranty, and to deliver documentation similar to
that described in Section 4.1(iii), (iv), (v) and (vii) relating to the
authorization for, execution and delivery of, and validity of such Significant
Subsidiary's obligations as a Guarantor, such documentation to be in form and
substance reasonably satisfactory to the Agent.
(b) If at any time the Guarantors do not consist of Subsidiaries of the
Borrower which, in the aggregate, had revenues (determined in accordance with
GAAP) for the immediately preceding fiscal year of the Borrower in excess of 90%
of the consolidated revenues (determined in accordance with GAAP) of the
Borrower and the Consolidated Subsidiaries for such immediately preceding fiscal
year, then the Borrower shall promptly cause one or more additional Subsidiaries
each to execute the Guaranty pursuant to an Addendum thereto in the form of
Annex I to the Guaranty, and to deliver documentation similar to that described
in Section 4.1(iii), (iv), (v) and (vii) relating to the authorization for,
execution and delivery of, and validity of such Subsidiary's obligations as a
Guarantor, such documentation to be in form and substance reasonably
satisfactory to the Agent, so that the aggregate consolidated revenues
(determined in accordance with GAAP) of the Guarantors for such fiscal year
equal or exceed 90% of the consolidated revenues (determined in accordance with
GAAP) of the Borrower and the Consolidated Subsidiaries for such fiscal year.
6.21. CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES. The Borrower will not
permit any of its Subsidiaries to enter into, after the date hereof, any
agreement, instrument, indenture or other arrangement that, directly or
indirectly, prohibits or restrains, or has the effect of prohibiting or
restraining, or imposes materially adverse conditions upon, the incurrence or
payment of Indebtedness owed to the Borrower or any other Subsidiary of the
Borrower, the granting of
39
Liens, the declaration or payment of dividends, or the making of loans, advances
or other Investments to or in the Borrower or any other Subsidiary of the
Borrower.
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 by or on behalf of the Borrower or any of its
Subsidiaries to the Lenders or the Agent under or in connection with this
Agreement, any Loan or any certificate or information delivered in connection
with this Agreement or any other Loan Document shall be materially false on
the date as of which made or deemed made.
7.2. FAILURE TO PAY. Nonpayment of principal of any Loan when due, or
nonpayment of interest on any Loan or of any facility fee or other
obligations under any of the Loan Documents within five days after the same
becomes due.
7.3. BREACH OF CERTAIN COVENANTS. The breach by the Borrower of any of
the terms or provisions of Section 6.2, 6.3, 6.5, 6.11, 6.12, 6.13, 6.14, 6.15,
6.16, 6.17, 6.18, or 6.19.
7.4. BREACH OF OTHER COVENANTS. 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 which is not remedied within five days
after written notice from the Agent or any Lender.
7.5. CROSS-DEFAULT. Failure of the Borrower or any Consolidated
Subsidiary to pay when due or within any applicable grace period any portion of
either any single obligation constituting Indebtedness in excess of $20,000,000
(or the equivalent thereof in any other currency) or Indebtedness in an
aggregate principal amount in excess of $60,000,000 (or the equivalent thereof
in any other currency); or any default or other event shall occur under or with
respect to either any agreement under which any single obligation constituting
Indebtedness in excess of $20,000,000 (or the equivalent thereof in any other
currency) was created or is governed, or any agreements under which Indebtedness
in an aggregate principal amount in excess of $60,000,000 (or the equivalent
thereof in any other currency) was created or is governed, the effect of which,
in either case, is to cause, or to permit the holder or holders of such
Indebtedness to cause, such Indebtedness to become due prior to its stated
maturity; or either any single obligation constituting Indebtedness in excess of
$20,000,000 (or the equivalent thereof in any other currency) or Indebtedness in
an aggregate principal amount in excess of $60,000,000 (or the equivalent
thereof in any other currency) 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.
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7.6. VOLUNTARY BANKRUPTCY, ETC. The Borrower or any Consolidated
Subsidiary shall (i) fail to pay, or admit in writing its inability to pay, its
debts generally as they become due, (ii) have an order for relief entered with
respect to it under the Federal bankruptcy laws as now or hereafter in effect,
(iii) make an assignment for the benefit of creditors, (iv) 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, (v) 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, (vi) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
Section 7.6 or (vii) fail to contest in good faith any appointment or proceeding
described in Section 7.7.
7.7. INVOLUNTARY BANKRUPTCY, ETC. Without the application, approval or
consent of the Borrower or any Consolidated Subsidiary, a receiver, trustee,
examiner, liquidator or similar official shall be appointed for the Borrower or
any Consolidated Subsidiary or any Substantial Portion of its Property, or a
proceeding described in Section 7.6(v) shall be instituted against the Borrower
or any Consolidated Subsidiary and such appointment continues undischarged or
such proceeding continues undismissed or unstayed for a period of 45 consecutive
days.
7.8. JUDGMENTS. The Borrower or any Consolidated Subsidiary shall fail
within 45 days to pay, bond or otherwise discharge any judgment or order for the
payment of money in excess of $1,000,000, which is not stayed on appeal or
otherwise being appropriately contested in good faith.
7.9. ERISA. The Unfunded Liabilities of all Single Employer Plans shall
exceed in the aggregate $80,000,000 or any Reportable Event shall occur in
connection with any Plan.
7.10. SEIZURE. An administrator, custodian or other representative, by
or pursuant to any legislative act, resolution or rule (other than the Federal
bankruptcy laws or any similar law, State or Federal, whether now or hereafter
existing) or any order or decree of any court or any governmental board or
agency (other than any order or decree issued pursuant to the Federal bankruptcy
laws or any similar law, State or Federal, whether now or hereafter existing)
shall take possession or control of all or such portions of the property of any
one or more of the Borrower and the Consolidated Subsidiaries as would, in the
sole opinion of the Required Lenders, materially interfere with the operation of
the business of the Borrower and the Consolidated Subsidiaries, on a
consolidated basis, and such possession or control shall continue for 45
calendar days.
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
toxic or hazardous waste or substance into the environment, or any violation of
any federal, state or local environmental, health or safety law or regulation,
which, in either case, could reasonably be expected to have a Material Adverse
Effect.
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7.12. INVALIDITY, ETC. OF LOAN DOCUMENTS. Any provision of any Loan
Document shall at any time for any reason cease to be valid and binding and
enforceable against the Borrower or any Guarantor, or the validity, binding
effect or enforceability thereof against the Borrower or any Guarantor shall be
contested by any Person, or the Borrower or any Guarantor shall deny that it
has any or further liability or obligation thereunder, or any Loan Document
shall be terminated, invalidated or set aside, or be declared ineffective or
inoperative or in any way cease to give or provide to the Lenders and the Agent
the benefits purported to be created thereby.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. ACCELERATION. If any Default described in Section 7.6 or 7.7
occurs as a result of any action taken by or against the Borrower, the
obligations of the Lenders to make Loans hereunder shall automatically terminate
and the Obligations shall immediately become due and payable without any
election or action on the part of the Agent or any Lender. If any other
Default occurs, the Required Lenders (or the Agent, with the written consent of
the Required Lenders) may terminate or suspend the obligations of the Lenders to
make Loans hereunder, or declare the Obligations to be due and payable, or both,
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.
If, within 14 days after acceleration of the maturity of the Obligations or
termination of the obligations of the Lenders to make Loans 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, the Required Lenders
(in their sole discretion) shall so direct, the Agent shall, by notice to the
Borrower, rescind and annul such acceleration and/or termination, provided that
the Borrower certifies to the Lenders to their satisfaction that, upon giving
effect to such rescission, no other Indebtedness of the Borrower shall be
accelerated by virtue of a cross-default or cross-acceleration to Indebtedness
under this Agreement.
8.2. AMENDMENTS. Subject to the provisions of this Article VIII, the
Required Lenders (or the 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 any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of each Lender affected thereby:
(i) Extend the maturity or the time of payment of any Loan or
reduce the principal amount thereof, or reduce the rate or
extend the time of payment of interest thereon or fees
hereunder.
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(ii) Reduce the percentage specified in the definition of Required
Lenders or amend, modify or waive any provision requiring action by
the Required Lenders to require action by any other Person in lieu
of the Required Lenders.
(iii) Extend the Tranche A Facility Termination Date, extend the Tranche
B Facility Termination Date other than as provided in Section 2.19,
or reduce the amount or extend the payment date for, the mandatory
payments required under Section 2.2, or increase the amount of the
Commitment of any Lender hereunder, or permit the Borrower to
assign its rights under this Agreement.
(iv) Amend, modify, or waive Section 2.2(a), Section 4.1, Section 4.2,
this Section 8.2, or Section 12.1.
(v) Release FedEx or RPS from any of their material obligations,
respectively, under the Guaranty.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of the fee required under Section 12.3.3 without obtaining the consent of any
other party to this Agreement.
8.3. PRESERVATION OF RIGHTS. No delay or omission of the Lenders or the
Agent to exercise any right under the Loan Documents shall impair such right or
be construed to be a waiver of any Default or an acquiescence therein, and the
making of a Loan notwithstanding the existence of a Default or the inability of
the Borrower to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the 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 this
Agreement and the making of the Loans 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.
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9.3. TAXES. Any taxes (excluding income taxes on the overall net income
of any Lender) or other similar assessments or charges payable or ruled payable
by any governmental authority in respect of the Loan Documents shall be paid by
the Borrower, together with interest and penalties, if any.
9.4. HEADINGS. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
9.5. ENTIRE AGREEMENT. The Loan Documents embody the entire agreement
and understanding among the Borrower, the Agent and the Lenders and supersede
all prior agreements and understandings among the Borrower, the 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. 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. The Borrower shall reimburse the Agent
for any and all reasonable costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the Agent, which
attorneys may be employees of the Agent) paid or incurred by the Agent in
connection with the preparation, negotiation, execution, delivery (subject to,
with respect to all the foregoing, the terms of that certain commitment letter
between the Agent and the Borrower dated November 17, 1997, as it may be amended
or supplemented from time to time), amendment, and modification, of the Loan
Documents. The Borrower also agrees to reimburse the Agent and the Lenders for
any and all reasonable costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the Agent and the
Lenders, which attorneys may be employees of the Agent or the Lenders) paid or
incurred by the Agent or any Lender in connection with the collection and
enforcement of the Loan Documents and the protection of rights thereunder. The
Borrower further agrees to indemnify the Agent and each Lender, its directors,
officers and employees against all losses, claims, damages, penalties,
judgments, liabilities and expenses (including, without limitation, all expenses
of litigation or preparation therefor whether or not the Agent or any Lender is
a party thereto) which any of them may pay or incur arising out of or relating
to this Agreement, the other Loan Documents, the transactions contemplated
hereby or the direct or indirect application or proposed application of the
proceeds of any Loan hereunder. The obligations of the Borrower under this
Section shall survive the termination of this Agreement, the cancellation of the
Commitments, and the payment of all outstanding Obligations.
9.8. NUMBERS OF DOCUMENTS. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may furnish one to each of the Lenders.
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9.9. SEVERABILITY OF PROVISIONS. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.10. NONLIABILITY OF LENDERS. The relationship between the Borrower and
the Lenders and the Agent shall be solely that of borrower and lender. Neither
the Agent nor any Lender shall have any fiduciary responsibilities to the
Borrower. Neither the Agent nor any 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.
9.11. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE
TO NATIONAL BANKS.
9.12. CONSENT TO 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 Loan Document 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. Nothing herein shall limit the right of
the Agent or any Lender to bring proceedings against the Borrower in the courts
of any other jurisdiction. Any judicial proceeding by the Borrower against the
Agent or any Lender or any Affiliate of the Agent or any Lender involving,
directly or indirectly, any matter in any way arising out of, related to, or
connected with any Loan Document shall be brought only in a court in Chicago,
Illinois.
9.13. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
9.14. CONFIDENTIALITY. The Agent and each Lender agrees to hold any
confidential information which it may receive from the Borrower pursuant to this
Agreement or in the course of an inspection pursuant to Section 6.10 in
confidence, except for disclosure (i) to other Lenders and their respective
Affiliates, each of whom shall be made aware of the terms of this Section 9.14
and shall agree to abide thereby, (ii) to legal counsel, accountants, and other
professional advisors to the Agent or that Lender, (iii) to regulatory officials
(provided that, to the extent practicable and permissible, the Agent and each
Lender shall give the Borrower prior notice of such disclosure), (iv) as
required by law, regulation, or legal process, (v) in connection with any legal
proceeding to which the Agent or that Lender is a party, and (vi) permitted by
Section 12.4; provided that, in connection with any disclosure permitted under
clause (iv) or (v) hereinabove,
45
the Agent or such Lender, as appropriate, shall give the Borrower prior notice
of such disclosure unless such notice is prohibited by law, regulation, or
process.
9.15. ACCOUNTING. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.
9.16. RELEASE OF GUARANTORS. Upon the consummation of any liquidation,
dissolution, merger, consolidation, sale or other transfer of a Guarantor other
than FedEx or RPS (collectively, a "Transfer"), and provided no Default or
Unmatured Default has occurred and is continuing or would occur as a result of
such Transfer, such Guarantor shall automatically be released from all of its
obligations under the Guaranty, and, if the Borrower so requests, the Lenders
shall promptly execute an instrument, in form and substance reasonably
satisfactory to the Borrower and the Agent, evidencing such release.
ARTICLE X
THE AGENT
10.1. APPOINTMENT. The First National Bank of Chicago is hereby
appointed Agent hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this ARTICLE
X. The defined term "Agent" is used in this Agreement solely as a matter of
market convention. Each Lender expressly understands and agrees that the Agent
shall not have any fiduciary responsibilities to any Lender by reason of this
Agreement and that the Agent is merely acting as the representative of the
Lenders with only those duties as are expressly set forth in this Agreement and
the other Loan Documents. In its capacity as the Lenders' contractual
representative, the Agent does not assume any fiduciary duty to any of the
Lenders and 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
Loan Documents. Each of the Lenders hereby agrees to assert no claim against
the Agent on any agency theory or any other theory of liability for breach of
fiduciary duty, all of which claims each Lender waives.
10.2. POWERS. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
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10.3. GENERAL IMMUNITY. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
for its or their own gross negligence or willful misconduct.
10.4. NO RESPONSIBILITY FOR LOANS, RECITALS, ETC. The Agent shall be
deemed not to have knowledge of any Default or Unmatured Default unless and
until written notice thereof is given to the Agent by the Borrower or a Lender,
and neither the Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Agent.
10.5. ACTION ON INSTRUCTIONS OF LENDERS. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
requisite number of Lenders, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Lenders and on
all holders of Loans unless the Required Lenders are not authorized to direct
the Agent to so act or so fail to act under the terms of this Agreement. The
Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Loan Document unless it shall first be indemnified
to its satisfaction 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 Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
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 Agent shall be entitled to advice of
counsel concerning all matters pertaining to its duties hereunder and under any
other Loan Document.
10.7. RELIANCE ON DOCUMENTS; COUNSEL. The Agent shall be entitled to
rely upon any notice, consent, certificate, affidavit, letter, telegram, telex,
telecopy, telefacsimile, 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 to legal matters, upon the opinion of counsel selected
by the Agent, which counsel may be employees of the Agent.
10.8. AGENT'S REIMBURSEMENT AND INDEMNIFICATION. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (i) for any amounts not reimbursed by the Borrower for which the
Agent is entitled to reimbursement by the
47
Borrower under the Loan Documents, (ii) for any other expenses incurred by the
Agent on behalf of the Lenders, in connection with the preparation, execution,
delivery, administration and enforcement of the Loan Documents to the extent
such expenses are or may be obligations of the Borrower to the Agent 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 Agent in
any way relating to or arising out of the Loan 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
they arise from the gross negligence or willful misconduct of the Agent. The
obligations of the Lenders under this Section 10.8 shall survive payment of the
Obligations and termination of this Agreement.
10.9. RIGHTS AS A LENDER. With respect to its Commitment and the Loans
made by it, the Agent shall have the same rights and powers hereunder and under
any other Loan Document as any Lender and may exercise the same as though it
were not the Agent, and the term "Lender" or "Lenders" shall, at any time when
the Agent is a Lender, unless the context otherwise indicates, include the Agent
in its individual capacity. The 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 Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Agent, in its individual capacity, is not obligated to remain a Lender except as
provided under Article XII.
10.10. LENDER CREDIT DECISION. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by the Borrower 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 Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
10.11. SUCCESSOR AGENT. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, and the Agent may be
removed at any time with or without cause by written notice received by the
Agent from the Required Lenders. Upon any such resignation or removal, the
Required Lenders shall have the right to appoint, on behalf of the Borrower and
the Lenders and with the consent of the Borrower (which shall not be
unreasonably withheld), a successor Agent. If no successor Agent shall have
been so appointed by the Required Lenders and consented to by the Borrower and
shall have accepted such appointment within thirty days after the retiring
Agent's giving notice of resignation, then the retiring Agent may appoint, on
behalf of the Lenders, a successor Agent, provided that the Borrower shall have
the right to remove such successor Agent and replace it with a successor of its
own designation with the consent of the Required Lenders (which shall not be
unreasonably withheld). Such successor Agent shall be a commercial bank having
capital and retained earnings of at least
48
$250,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Agent, and the retiring or removed Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents. After any
retiring or removed Agent's resignation or removal hereunder as 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
Agent hereunder and under the other Loan Documents.
10.12. DISTRIBUTION OF INFORMATION. The Borrower authorizes the Agent, as
the Agent may elect in its sole discretion, to discuss with and furnish to the
Lenders or to any other Person having an interest in the Obligations (whether as
a guarantor, pledgor of collateral, participant, purchaser or otherwise) all
financial statements, audit reports and other information pertaining to the
Borrower and its Subsidiaries whether such information was provided by the
Borrower or prepared or obtained by the Agent, subject to Section 9.14. Neither
the Agent nor any of its employees, officers, directors or agents makes any
representation or warranty regarding any audit reports or other analyses of the
Borrower's and its Subsidiaries condition which the Agent may elect to
distribute, whether such information was provided by the Borrower or prepared or
obtained by the Agent, nor shall the Agent or any of its employees, officers,
directors or agents be liable to any person or entity receiving a copy of such
reports or analyses for any inaccuracy or omission contained in or relating
thereto. Except as expressly set forth herein, the Agent shall have no duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to the Borrower or any of the Subsidiaries that is communicated to or
obtained by the bank serving as Agent, or any of such Bank's Affiliates, in any
capacity.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. SETOFF. In addition to, and without limitation of, any rights of
the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default or Unmatured Default occurs, 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 to or for the credit or account of the Borrower may be offset and
applied toward the payment of the Obligations owing to such 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 Loans (other than payments received pursuant to
Section 3.1, 3.2 or 3.4) in a greater proportion than that received by any other
Lender, such Lender agrees, promptly upon demand, to purchase a portion of the
Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other
49
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 their Loans. In case any such payment is disturbed by legal process, or
otherwise, appropriate further adjustments shall be made to accomplish the
intent of this Section.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. SUCCESSORS AND ASSIGNS. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and 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 the
Loan 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 or the Agent, assign all or any
portion of its rights under this Agreement to a Federal Reserve Bank; provided,
however, that no such assignment shall release the transferor Lender from its
obligations hereunder. The Agent may treat each Lender as the owner of the
Loans made by such Lender for all purposes hereof unless and until such Lender
complies with Section 12.3 in the case of an assignment thereof or, in the case
of any other transfer, a written notice of the transfer is filed with the Agent.
Any assignee or transferee of a Loan agrees by acceptance thereof to be bound by
all the terms and provisions of the Loan 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 owner of any Loan, shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Loan.
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 entities ("Participants")
participating interests in any Loan owing to such Lender, any note held by
such Lender evidencing any such Loan, any Commitment of such Lender or any
other interest of such Lender under the Loan Documents. In the event of
any such sale by a Lender of participating interests to a Participant, such
Lender's obligations under the Loan 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 owner of all
Loans made by it for all purposes under the Loan 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 and the
Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Loan
Documents.
50
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 Loan Documents other than
any amendment, modification or waiver with respect to any Loan or
Commitment in which such Participant has an interest which requires the
approval of all of the Lenders pursuant to Section 8.2.
12.2.3. BENEFIT OF SETOFF. Upon selling any participating
interest to a Participant pursuant to Section 12.2.1, each Lender will have
the option to, but shall not be required to, give the Borrower and the
Agent written notice of the fact that it has made such a sale (without
being required to specify the amount or any other information concerning
the participating interest sold) and the name of the purchasing Participant
(each Participant named in such a notice is hereinafter referred to as an
"Acknowledged Participant"). The Borrower agrees that each Acknowledged
Participant shall be deemed to have the right of setoff provided in Section
11.1 as of the date of the Borrower's receipt of the aforementioned notice
in respect of its participating interest in amounts owing under the Loan
Documents to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan 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
Acknowledged Participant. The Lenders agree to share with each
Acknowledged Participant, and each Acknowledged 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 of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Acknowledged 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
make one assignment to one bank or other entity (each a "Purchaser") of all
of its rights and obligations under the Loan Documents, unless additional
assignments are agreed to by the Borrower and the Agent. Any assignment
under this Section 12.3 shall be substantially in the form of Exhibit "C"
hereto or in such other form as may be agreed to by the parties thereto.
Unless an acceleration of the Obligations has occurred and is continuing,
the consent of the Borrower and the Agent shall be required prior to an
assignment becoming effective with respect to a Purchaser which is not a
Lender or an Affiliate thereof. Such consent shall not be unreasonably
withheld. Notwithstanding anything in this Article XII to the contrary,
nothing in this Agreement shall prohibit or limit the right of any Lender
to make assignments (and no consent shall be required in connection with
such assignments) of all or any part of its interests under the Loan
Documents (i) to a Purchaser which is a Lender or an Affiliate thereof and
(ii) after the occurrence and during the continuance of an acceleration of
the Obligations, to any Purchaser.
12.3.2. REQUIRED ASSIGNMENTS. The Borrower shall have the
right, by giving at least 15 Business Days' prior written notice to the
affected Lender and the Agent, at any time when no Default or Unmatured
Default has occurred and is continuing, to require any
51
Lender to assign all of its rights and obligations under the Loan Documents
to a Purchaser approved by the Borrower. Such assignment shall be
substantially in the form of Exhibit "C" hereto or in such other form as
may be agreed to by the parties thereto but shall be on terms and
conditions reasonably satisfactory to the affected Lender. If the affected
Lender is a Reference Lender, the Agent, with the consent of the Borrower
(which shall not be unreasonably withheld), shall appoint a new Reference
Lender from among the Lenders. The Borrower shall remain liable to the
affected Lender for any indemnification provided under Section 3.4 with
respect to Loans of such Lender outstanding on the effective date of an
assignment required under this Section 12.3.2, as well as for all other
Obligations owed to such Lender under this Agreement as of such effective
date.
12.3.3. EFFECT; EFFECTIVE DATE. Upon (i) delivery to the Agent
of a notice of assignment, substantially in the form attached as Exhibit
"I" to Exhibit "C" hereto (a "Notice of Assignment"), together with any
consents required by Section 12.3.1, and (ii) payment of a $4,000 fee to
the Agent for processing such assignment, such assignment shall become
effective on the effective date specified in such Notice of Assignment. On
and after the effective date of such assignment, such Purchaser shall for
all purposes be a Lender under this Agreement and any other Loan Document
executed by the Lenders and shall have all the rights and obligations of a
Lender under the Loan Documents, to the same extent as if it were an
original party hereto, and no further consent or action by the Borrower,
the Lenders or the Agent shall be required to release the transferor Lender
with respect to the Commitments and Loans assigned to such Purchaser and
such Lender shall be immediately so released. Upon the consummation of any
assignment to a Purchaser pursuant to this Section 12.3.3, the transferor
Lender, the Agent and the Borrower shall make appropriate arrangements so
that, to the extent notes have been issued to evidence any of the
transferred Loans, replacement notes are issued to such transferor Lender
and, if so requested by such Purchaser, new notes or, as appropriate,
replacement notes, are issued to such Purchaser, in each case in principal
amounts reflecting their respective Tranche A and Tranche B Commitments, as
adjusted pursuant to such assignment.
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 Loan 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
9.14 of this Agreement.
12.5. TAX TREATMENT. If any interest in any Loan 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.
52
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 Loan Document shall be in
writing or by telex or by facsimile and addressed or delivered to such party at
its address set forth below its signature hereto or at such other address as may
be designated by such party in a notice to the other parties. Any notice, if
mailed and properly addressed with postage prepaid or if delivered to the
Borrower's delivery service and properly addressed, shall be deemed given when
received; any notice, if transmitted by telex or facsimile, shall be deemed
given when transmitted (answerback confirmed in the case of telexes).
13.2. CHANGE OF ADDRESS. The Borrower, the Agent and any Lender may each
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective upon receipt by the Agent of original or faxed copies of such
counterparts executed by the Borrower, the Agent and the Lenders.
ARTICLE XV
TERMINATION OF 1995 CREDIT AGREEMENT
FedEx and each Lender which is also a party to the 1995 Credit Agreement
agree that when all of the conditions set forth in Section 4.1 hereof have been
satisfied and FedEx has repaid all of its "Obligations" (as defined in the 1995
Credit Agreement), the 1995 Credit Agreement shall terminate, automatically and
without notice.
53
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
FDX CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Treasurer
FDX Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasurer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
FDX Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Federal Express Corporation consents and agrees to Article XV hereof.
FEDERAL EXPRESS CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
-----------------------------------
Title: VICE PRESIDENT AND TREASURER
----------------------------------
54
COMMITMENT
THE FIRST NATIONAL BANK OF
Tranche A Commitment: CHICAGO, Individually and as Agent
$56,000,000
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇ ▇. ▇▇▇▇▇
$14,000,000 Authorized Agent
One First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Transportation Division
Administrative Coordinator
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The First National Bank of Chicago
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The First National Bank of Chicago
One First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
55
COMMITMENT
▇▇▇▇▇▇ GUARANTY TRUST
Tranche A Commitment: COMPANY OF NEW YORK
$56,000,000
Tranche B Commitment: By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
$14,000,000 ▇▇▇▇▇ ▇▇▇▇▇▇
Vice President
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
▇▇▇▇▇▇ Guaranty Trust Company of New York
c/o ▇. ▇. ▇▇▇▇▇▇ Services, Inc.
▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/1874
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
56
COMMITMENT
THE CHASE MANHATTAN BANK
Tranche A Commitment:
$56,000,000
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
$14,000,000 Vice President
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
All Borrowing Notices to:
The Chase Manhattan Bank
One Chase Plaza
8th Floor
Loan & Agency Services
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Mo-Lin Sum
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
57
COMMITMENT
KREDIETBANK N.V.
Tranche A Commitment:
$48,000,000
Tranche B Commitment: By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
$12,000,000 ▇▇▇ ▇. ▇▇▇▇▇
Vice President
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Kredietbank N.V.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Senior Lending Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, VP
Kredietbank N.V.
Two Midtown Plaza, Suite 1750
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Kredietbank, N.V.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Loan Administration
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/0653
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ NATIONAL TRUST
Tranche A Commitment: AND SAVINGS ASSOCIATION
$48,000,000
Tranche B Commitment: By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
$12,000,000 ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Managing Director
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Bank of America National Trust
and Savings Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Bank of America National Trust
and Savings Association
Corporate Service Center #5693
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇/▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/7761
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇/8217
59
COMMITMENT
BANK OF TOKYO-MITSUBISHI
Tranche A Commitment: TRUST COMPANY
$48,000,000
Tranche B Commitment: By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
$12,000,000 ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
1251 Avenue of the Americas
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: 212-782-4979
Copy all notices and credit matters to:
The Bank of Tokyo Trust Company
1251 Avenue of the Americas
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: 212-782-4979
Copy all Borrowing Notices to:
The Bank of Tokyo Trust Company
1251 Avenue of the Americas
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇, Operations Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
60
COMMITMENT
CITICORP USA, INC.
Tranche A Commitment:
$48,000,000
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇ ▇. ▇▇▇▇
$12,000,000 Vice President
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇/▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Portfolio Management
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
▇/▇ ▇▇▇▇▇▇▇▇, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ Floor/Zone ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Portfolio Management
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
▇/▇ ▇▇▇▇▇▇▇▇, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇/▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Global Aviation
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
61
COMMITMENT
COMMERZBANK AKTIENGESELLSCHAFT,
Tranche A Commitment: ATLANTA AGENCY
$48,000,000
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇ ▇▇▇▇▇▇
$12,000,000 Senior Vice President
By: s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇
Vice President
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/6517
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇ Agency
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/6517
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Commerzbank AG
2 World Financial Center, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
62
COMMITMENT
NATIONSBANK, N.A.
Tranche A Commitment:
$48,000,000
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
$12,000,000
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
NationsBank, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
NationsBank, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
63
COMMITMENT
CIBC INC.
Tranche A Commitment:
$32,000,000
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇ ▇▇▇▇▇▇
$8,000,000 Executive Director
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp., as Agent
Two Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp.
Two Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp.
Two Paces West
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Ava Cool
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
64
COMMITMENT
THE FUJI BANK, LIMITED
Tranche A Commitment:
$32,000,000
By: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
$8,000,000 Joint General Manager
Marquis One Tower, Suite 2100
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Fuji Bank, Limited
Marquis One Tower
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The Fuji Bank, Limited
Marquis One Tower
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
65
COMMITMENT
MELLON BANK, N.A.
Tranche A Commitment:
$32,000,000
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
$8,000,000 Assistant Vice President
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Mellon Bank, N.A.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Mellon Bank, N.A.
3 Mellon Bank Center, Room 2305
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
66
COMMITMENT
KEYBANK NATIONAL ASSOCIATION
Tranche A Commitment:
$32,000,000
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
$8,000,000
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Keybank National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Keybank National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: 216/▇▇▇-▇▇▇▇/3618
Telecopy: 216/689-4981
67
COMMITMENT
FIRST AMERICAN NATIONAL BANK
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
$6,000,000 Senior Vice President
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
First American National Bank
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
First American National Bank
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Frenisa Joy/▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/5681
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
68
COMMITMENT
BANK OF HAWAII
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
$6,000,000 Vice President
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Bank of Hawaii
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Bank of Hawaii
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇/▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇/537-8684
69
COMMITMENT
THE BANK OF NEW YORK
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
$6,000,000 Assistant Vice President
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/6737
Telecopy: 212-635-6399/6877
70
COMMITMENT
THE BANK OF NOVA SCOTIA
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇ ▇▇▇▇▇
$6,000,000 Senior Manager, Loan Operations
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Bank of Nova Scotia
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
71
COMMITMENT
CREDIT SUISSE FIRST BOSTON
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
$6,000,000
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Credit Suisse First Boston
Eleven Madison Avenue
New York, New York 10010-3629
Attn: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
72
COMMITMENT
THE LONG-TERM CREDIT BANK OF
Tranche A Commitment: JAPAN, LTD., NEW YORK BRANCH
$24,000,000
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
$6,000,000
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Long-Term Credit Bank of Japan, Ltd.,
New York Branch
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇
Assistant Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The Long-Term Credit Bank of Japan, Ltd.,
New York Branch
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Assistant Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
73
COMMITMENT
THE SANWA BANK, LIMITED
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
$6,000,000 Vice President
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
Suite ▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
The Sanwa Bank, Limited
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
Suite ▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
The Sanwa Bank, Limited
Park Avenue Plaza
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ Hara
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
74
COMMITMENT
SOCIETE GENERALE, SOUTHWEST
Tranche A Commitment: AGENCY
$24,000,000
By: /s/ THIERRY NAMUROY
------------------------------------
Tranche B Commitment: Thierry Namuroy
$6,000,000 Vice President
4800 ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Societe Generale, Southwest Agency
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: Thierry Namuroy
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Societe Generale, Southwest Agency
4800 ▇▇▇▇▇▇▇▇ ▇▇▇▇ Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
75
COMMITMENT
SUNTRUST BANK, NASHVILLE, N.A.
Tranche A Commitment:
$24,000,000
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Tranche B Commitment: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
$6,000,000
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all notices and credit matters to:
Suntrust Bank, Nashville, N.A.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Drake
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Copy all Borrowing Notices to:
Suntrust Bank, Nashville, N.A.
P.O. Box 305110
Commercial Loan Operation
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Leigh ▇▇▇▇ ▇▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇/4031
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
76
EXHIBIT "A"
FORM OF GUARANTY
THIS GUARANTY (this "Guaranty") is made as of the 15th day of January,
1998, by Federal Express Corporation, a Delaware corporation, RPS, Inc., a
Delaware corporation, Caliber System, Inc., an Ohio corporation, Viking Freight,
Inc., a California corporation, and ▇▇▇▇▇▇▇ Express, Inc., an Ohio corporation
(collectively, the "Initial Guarantors" and along with any Significant
Subsidiaries which become parties to this Agreement by executing an Addendum
hereto in the form attached as Annex I, the "Guarantors") in favor of the Agent,
for the ratable benefit of the Lenders, under (and as defined in) the Credit
Agreement referred to below. Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to them in the Credit Agreement.
WITNESSETH:
WHEREAS, FDX Corporation, a Delaware corporation (the "Borrower"), The
First National Bank of Chicago, as agent (the "Agent"), and certain Lenders have
entered into a certain Credit Agreement dated as of January 15, 1998 (as same
may be amended, modified, supplemented and/or restated, and as in effect from
time to time, the "Credit Agreement"), providing, subject to the terms and
conditions thereof, for extensions of credit to be made by
the Lenders to the Borrower;
WHEREAS, it is a condition precedent to the initial extensions of credit by
the Lenders under the Credit Agreement that each of the Guarantors execute and
deliver this Guaranty, whereby each of the Guarantors shall guarantee the
payment when due, subject to SECTION 8 hereof, of any and all of the
Obligations; and
WHEREAS, in consideration of the financial and other support that the
Borrower has provided, and such financial and other support as the Borrower may
in the future provide, to the Guarantors, and in order to induce the Lenders and
the Agent to enter into the Credit Agreement, each of the Guarantors is willing
to guarantee the obligations of the Borrower under the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION l. DEFINITIONS. Terms defined in the Credit Agreement and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein.
SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS. Each of the
Guarantors represents and warrants (which representations and warranties shall
be deemed to have been renewed at the time of the making of any Advance) that:
77
(a) It is a corporation, limited liability company, partnership or
other commercial entity duly incorporated or formed, validly existing and in
good standing under the laws of its jurisdiction of incorporation or formation
and has all requisite authority to conduct its business as a foreign Person in
each jurisdiction in which its business is conducted, except where the failure
to have such requisite authority would not have a Material Adverse Effect.
(b) It has the power and authority and legal right to execute and
deliver this Guaranty and to perform its obligations hereunder. The execution
and delivery by it of this Guaranty and the performance by it of its obligations
hereunder have been duly authorized by proper proceedings, and this Guaranty
constitutes a legal, valid and binding obligation of such Guarantor enforceable
against such Guarantor in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally.
(c) Neither the execution and delivery by it of this Guaranty, nor
the consummation by it of the transactions herein contemplated, nor compliance
by it with the terms and provisions hereof, will violate any law, rule,
regulation, order, writ, judgment, injunction, decree or award binding on it or
its certificate or articles of incorporation or by-laws, limited liability
company or partnership agreement or the provisions of any indenture, instrument
or material agreement to which it 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 its property
pursuant to the terms of any such indenture, instrument or material 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 by it of, or the legality, validity, binding
effect or enforceability of, this Guaranty.
In addition to the foregoing, each of the Guarantors covenants that,
so long as any Lender has any Commitment outstanding under the Credit Agreement
or any amount payable under the Credit Agreement or any other Obligations shall
remain unpaid, it will, and, if necessary, will enable the Borrower to, fully
comply with those covenants and agreements of the Borrower applicable to such
Guarantor set forth in the Credit Agreement.
SECTION 3. THE GUARANTY. Subject to SECTION 8 hereof, each of the
Guarantors hereby unconditionally guarantees, jointly with the other Guarantors
and severally, the full and punctual payment when due (whether at stated
maturity, upon acceleration or otherwise) of the Obligations, (the foregoing,
subject to the provisions of SECTION 8 hereof, being referred to collectively as
the "Guaranteed Obligations"). Upon failure by the Borrower to pay punctually
any such amount, each of the Guarantors agrees that it shall forthwith on demand
pay such amount at the place and in the manner specified in the Credit Agreement
or the relevant Loan Document, as the case may be. Each of the Guarantors
hereby agrees that this Guaranty is an absolute, irrevocable and unconditional
guaranty of payment and is not a guaranty of collection.
78
SECTION 4. GUARANTY UNCONDITIONAL. Subject to SECTION 8 hereof, the
obligations of each of the Guarantors hereunder shall be unconditional and
absolute and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:
(i) any extension, renewal, settlement, indulgence, compromise,
waiver or release of or with respect to the Guaranteed Obligations or
any part thereof or any agreement relating thereto, or with respect to
any obligation of any other guarantor of any of the Guaranteed
Obligations, whether (in any such case) by operation of law or
otherwise, or any failure or omission to enforce any right, power or
remedy with respect to the Guaranteed Obligations or any part thereof
or any agreement relating thereto, or with respect to any obligation
of any other guarantor of any of the Guaranteed Obligations;
(ii) any modification or amendment of or supplement to the Credit
Agreement or any other Loan Document, including, without limitation,
any such amendment which may increase the amount of the Obligations
guaranteed hereby;
(iii) any release, surrender, compromise, settlement, waiver,
subordination or modification, with or without consideration, of any
collateral securing the Guaranteed Obligations or any part thereof,
any other guaranties with respect to the Guaranteed Obligations or any
part thereof, or any other obligation of any person or entity with
respect to the Guaranteed Obligations or any part thereof, or any
nonperfection or invalidity of any direct or indirect security for the
Guaranteed Obligations;
(iv) any change in the corporate, partnership or other existence,
structure or ownership of the Borrower or any other guarantor of any
of the Guaranteed Obligations, or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting the Borrower or
any other guarantor of the Guaranteed Obligations, or any of their
respective assets or any resulting release or discharge of any
obligation of the Borrower or any other guarantor of any of the
Guaranteed Obligations;
(v) the existence of any claim, setoff or other rights which the
Guarantors may have at any time against the Borrower, any other
guarantor of any of the Guaranteed Obligations, the Agent, any Lender
or any other Person, whether in connection herewith or in connection
with any unrelated transactions, PROVIDED that nothing herein shall
prevent the assertion of any such claim by separate suit or compulsory
counterclaim;
(vi) the enforceability or validity of the Guaranteed Obligations
or any part thereof or the genuineness, enforceability or validity of
any agreement relating thereto or with respect to any collateral
securing the Guaranteed Obligations or any part thereof, or any other
invalidity or unenforceability relating to or against the Borrower or
any other guarantor of any of the Guaranteed Obligations, for any
reason related to the Credit Agreement, any other Loan Document, or
any provision of applicable law or regulation purporting to prohibit
the payment by the Borrower or any other guarantor of the Guaranteed
Obligations, of any of the Guaranteed Obligations;
79
(vii) the failure of the Agent to take any steps to perfect and
maintain any security interest in, or to preserve any rights to, any
security or collateral for the Guaranteed Obligations, if any;
(viii) the election by, or on behalf of, any one or more of the
Lenders, in any proceeding instituted under Chapter 11 of Title 11 of
the United States Code (11 U.S.C. 101 et seq.) (the "Bankruptcy
Code"), of the application of Section 1111(b)(2) of the Bankruptcy
Code;
(ix) any borrowing or grant of a security interest by the Borrower,
as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(x) the disallowance, under Section 502 of the Bankruptcy Code, of
all or any portion of the claims of any of the Lenders or the Agent
for repayment of all or any part of the Guaranteed Obligations;
(xi) the failure of any other Guarantor to sign or become party to
this Guaranty or any amendment, change, or reaffirmation hereof; or
(xii) any other act or omission to act or delay of any kind by the
Borrower, any other guarantor of the Guaranteed Obligations, the
Agent, any Lender or any other Person or any other circumstance
whatsoever which might, but for the provisions of this Section 4,
constitute a legal or equitable discharge of any Guarantor's
obligations hereunder.
SECTION 5. DISCHARGE ONLY UPON PAYMENT IN FULL: REINSTATEMENT IN CERTAIN
CIRCUMSTANCES. Except as otherwise provided in Section 9.16 of the Credit
Agreement, each of the Guarantors' obligations hereunder shall remain in full
force and effect until all Guaranteed Obligations shall have been paid in full
and the Commitments under the Credit Agreement shall have terminated or expired.
If at any time any payment of any portion of the Obligations is rescinded or
must be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, each Guarantor's obligations
hereunder with respect to such payment shall be reinstated as though such
payment had been due but not made at such time.
SECTION 6. GENERAL WAIVERS. Each of the Guarantors irrevocably waives
acceptance hereof, presentment, demand or action on delinquency, protest, the
benefit of any statutes of limitations and, to the fullest extent permitted by
law, any notice not provided for herein, as well as any requirement that at any
time any action be taken by any Person against the Borrower, any other guarantor
of the Guaranteed Obligations, or any other Person.
SECTION 7. SUBORDINATION OF SUBROGATION. Until the Obligations have been
indefeasibly paid in full in cash, the Guarantors (i) shall have no right of
subrogation with respect to such Obligations and (ii) waive any right to enforce
any remedy which the Lenders or the Agent now have or may hereafter have against
the Borrower, any endorser or any
80
guarantor of all or any part of the Obligations or any other Person, and the
Guarantors waive any benefit of, and any right to participate in, any security
or collateral given to the Lenders and the Agent to secure the payment or
performance of all or any part of the Obligations or any other liability of the
Borrower to the Lenders. Should any Guarantor have the right, notwithstanding
the foregoing, to exercise its subrogation rights, each Guarantor hereby
expressly and irrevocably (a) subordinates any and all rights at law or in
equity to subrogation, reimbursement, exoneration, contribution, indemnification
or set off that the Guarantor may have to the indefeasible payment in full in
cash of the Obligations and (b) waives any and all defenses available to a
surety, guarantor or accommodation co-obligor until the Obligations are
indefeasibly paid in full in cash. Each Guarantor acknowledges and agrees that
this subordination is intended to benefit the Agent and the Lenders and shall
not limit or otherwise affect such Guarantor's liability hereunder or the
enforceability of this Guaranty, and that the Agent, the Lenders and their
respective successors and assigns are intended third party beneficiaries of the
waivers and agreements set forth in this SECTION 7.
SECTION 8. LIMITATION. Notwithstanding any provision herein contained to
the contrary, each Guarantor's liability under this Guaranty (which liability is
in any event in addition to amounts for which such entity may be primarily
liable) shall be limited to an amount not to exceed as of any date of
determination the greater of:
(a) the net amount of all Loans advanced to the Borrower under this
Agreement and then re-loaned or otherwise transferred to, or for the benefit of,
such Guarantor; and
(b) the amount which could be claimed by the Agent and the Lenders
from such Guarantor under this Guaranty without rendering such claim voidable or
avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or under any
applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance
Act or similar statute or common law after taking into account, among other
things, such Guarantor's right of contribution and indemnification from each
other Guarantor under SECTION 9.
SECTION 9. CONTRIBUTION WITH RESPECT TO GUARANTY OBLIGATIONS.
(a) To the extent that any Guarantor shall make a payment under this
Guaranty (a "Guarantor Payment") which, taking into account all other Guarantor
Payments then previously or concurrently made by any other Guarantor, exceeds
the amount which such Guarantor would otherwise have paid if each Guarantor had
paid the aggregate Obligations satisfied by such Guarantor Payment in the same
proportion that such Guarantor's "Allocable Amount" (as defined below) (as
determined immediately prior to such Guarantor Payment) bore to the aggregate
Allocable Amounts of each of the Guarantors as determined immediately prior to
the making of such Guarantor Payment, THEN, following indefeasible payment in
full in cash of the Obligations and termination of the Commitments, such
Guarantor shall be entitled to receive contribution and indemnification payments
from, and be reimbursed by, each other Guarantor for the amount of such excess,
PRO RATA based upon their respective Allocable Amounts in effect immediately
prior to such Guarantor Payment.
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(b) As of any date of determination, the "Allocable Amount" of any
Guarantor shall be equal to the maximum amount of the claim which could then be
recovered from such Guarantor under this Guaranty without rendering such claim
voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or
under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act or similar statute or common law.
(c) This SECTION 9 is intended only to define the relative rights of
the Guarantors and nothing set forth in this SECTION 9 is intended to or shall
impair the obligations of the Guarantors, jointly and severally, to pay any
amounts as and when the same shall become due and payable in accordance with the
terms of this Agreement.
(d) The parties hereto acknowledge that the rights of contribution
and ndemnification hereunder shall constitute assets of the Guarantor to which
such contribution and indemnification is owing.
(e) The rights of the indemnifying Guarantors against other
Guarantors under this Section 9 shall be exercisable upon the full and
indefeasible payment of the Obligations and the termination of the Commitments.
SECTION 10. STAY OF ACCELERATION. If acceleration of the time for payment
of any of the Obligations is stayed upon the insolvency, bankruptcy or
reorganization of the Borrower, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement, or any other Loan Document
shall nonetheless be payable by each of the Guarantors hereunder forthwith on
demand by the Agent.
SECTION 11. NO WAIVERS. No failure or delay by the Agent or any Lender in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies provided in this Guaranty, the Credit Agreement, and the
other Loan Documents shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 12. SUCCESSORS AND ASSIGNS. This Guaranty is for the benefit of
the Agent and the Lenders and their respective successors and permitted assigns
and in the event of an assignment of any amounts payable under the Credit
Agreement, or the other Loan Documents in accordance with the respective terms
thereof, the rights hereunder, to the extent applicable to the indebtedness so
assigned, may be transferred with such indebtedness. This Guaranty shall be
binding upon each of the Guarantors and their respective successors and assigns.
SECTION 13. CHANGES IN WRITING. Neither this Guaranty nor any provision
hereof may be changed, waived, discharged or terminated orally, but only in
writing signed by each of the Guarantors and the Agent with the consent of the
Lenders required for such change, waiver, discharge or termination pursuant to
the terms of the Credit Agreement.
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SECTION 14. GOVERNING LAW. ANY DISPUTE BETWEEN ANY GUARANTOR AND THE
AGENT OR ANY LENDER ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH, THIS GUARANTY OR
ANY OF THE OTHER LOAN DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, 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.
SECTION 15. CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.
(A) EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF
THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH, THIS GUARANTY OR ANY OF THE OTHER LOAN DOCUMENTS WHETHER
ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED EXCLUSIVELY
BY STATE OR FEDERAL COURTS LOCATED IN ILLINOIS, BUT THE PARTIES HERETO
ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF ILLINOIS. EACH OF THE PARTIES HERETO WAIVES IN ALL DISPUTES
BROUGHT PURSUANT TO THIS SUBSECTION (A) ANY OBJECTION THAT IT MAY HAVE TO THE
LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(B) OTHER JURISDICTIONS. EACH OF THE GUARANTORS AGREES THAT THE AGENT,
ANY LENDER OR ANY INDEMNITEE SHALL HAVE THE RIGHT TO PROCEED AGAINST SUCH
GUARANTOR OR ITS PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO
(1) OBTAIN PERSONAL JURISDICTION OVER SUCH GUARANTOR OR (2) ENFORCE A JUDGMENT
OR OTHER COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. EACH OF THE GUARANTORS
AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING
BROUGHT BY SUCH PERSON TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
SUCH PERSON. EACH OF THE GUARANTORS 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) WAIVER OF JURY TRIAL. 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
GUARANTY OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION
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HEREWITH. EACH OF THE PARTIES HERETO 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
GUARANTY WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO
TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
(D) 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 16, WITH ITS COUNSEL.
SECTION 16. NO STRICT CONSTRUCTION. The parties hereto have participated
jointly in the negotiation and drafting of this Guaranty. In the event an
ambiguity or question of intent or interpretation arises, this Guaranty shall be
construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Guaranty.
SECTION 17. TAXES, EXPENSES OF ENFORCEMENT, ETC. All payments required to
be made by any of the Guarantors hereunder shall be made without setoff or
counterclaim and free and clear of and without deduction or withholding for or
on account of, any present or future taxes, levies, imposts, duties or other
charges of whatsoever nature imposed by any government or any political or
taxing authority thereof, provided, however, that if any of the Guarantors is
required by law to make such deduction or withholding, such Guarantor shall
forthwith pay to the Agent or any Lender, as applicable, such additional amount
as results in the net amount received by the Agent or any Lender, as applicable,
equaling the full amount which would have been received by the Agent or any
Lender, as applicable, had no such deduction or withholding been made. The
Guarantors also agree to reimburse the Agent and the Lenders for any reasonable
costs, internal charges and out-of-pocket expenses (including reasonable
attorneys' fees and time charges of attorneys for the Agent and the Lenders,
which attorneys may be employees of the Agent or the Lenders) paid or incurred
by the Agent or any Lender in connection with the collection and enforcement of
amounts due under the Loan Documents, including without limitation this
Guaranty.
SECTION 18. SETOFF. At any time after all or any part of the
Guaranteed Obligations have become due and payable (by acceleration or
otherwise), each Lender and the Agent may, without notice to any Guarantor
and regardless of the acceptance of any security or collateral for the
payment hereof, appropriate and apply toward the payment of all or any part
of the Guaranteed Obligations (i) any indebtedness due or to become due from
such Lender or the Agent to any Guarantor, and (ii) any moneys, credits or
other property belonging to any Guarantor, at any time held by or coming into
the possession of such Lender or the Agent or any of their respective
affiliates.
SECTION 19. FINANCIAL INFORMATION. Each Guarantor hereby assumes
responsibility for keeping itself informed of the financial condition of the
Borrower and any and all endorsers and/or other Guarantors of all or any part of
the Guaranteed Obligations, and of all other circumstances
84
bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part
thereof, that diligent inquiry would reveal, and each Guarantor hereby agrees
that none of the Lenders or the Agent shall have any duty to advise such
Guarantor of information known to any of them regarding such condition or any
such circumstances. If any Lender or the Agent, in its sole discretion,
undertakes at any time or from time to time to provide any such information to a
Guarantor, such Lender or the Agent shall be under no obligation (i) to
undertake any investigation not a part of its regular business routine, (ii) to
disclose any information which such Lender or the Agent, pursuant to accepted or
reasonable commercial finance or banking practices, wishes to maintain
confidential or (iii) to make any other or future disclosures of such
information or any other information to such Guarantor.
SECTION 20. SEVERABILITY. Wherever possible, each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
SECTION 21. MERGER. This Guaranty represents the final agreement of each
of the Guarantors with respect to the matters contained herein and may not be
contradicted by evidence of prior or contemporaneous agreements, or subsequent
oral agreements, between the Guarantor and any Lender or the Agent.
SECTION 22. EXECUTION IN COUNTERPARTS. This Guaranty 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 Guaranty by signing
any such counterpart.
SECTION 23. HEADINGS. Section headings in this Guaranty are for
convenience of reference only and shall not govern the interpretation of any
provision of this Guaranty.
85
IN WITNESS WHEREOF, each of the Guarantors has caused this Guaranty to be
duly executed by its authorized officer as of the day and year first above
written.
FEDERAL EXPRESS CORPORATION
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
RPS, INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
CALIBER SYSTEM, INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
VIKING FREIGHT, INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
▇▇▇▇▇▇▇ EXPRESS, INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
86
ANNEX I TO GUARANTY
Reference is hereby made to the Guaranty (the "Guaranty") made as of the
15th day of January, 1998 by Federal Express Corporation, a Delaware
corporation, RPS, Inc., a Delaware corporation, Caliber System, Inc., an Ohio
corporation, Viking Freight, Inc., a California corporation, and ▇▇▇▇▇▇▇
Express, Inc., an Ohio corporation (collectively, the "Initial Guarantors" and
along with any Significant Subsidiaries which have become parties thereto and
together with the undersigned, the "Guarantors") in favor of the Agent, for the
ratable benefit of the Lenders, under the Credit Agreement. Capitalized terms
used herein and not defined herein shall have the meanings given to them in the
Guaranty. By its execution below, the undersigned [NAME OF NEW GUARANTOR], a
____________________, agrees to become, and does hereby become, a Guarantor
under the Guaranty and agrees to be bound by such Guaranty as if originally a
party thereto. By its execution below, the undersigned represents and warrants
as to itself that all of the representations and warranties contained in Section
2 of the Guaranty are true and correct in all respects as of the date hereof.
IN WITNESS WHEREOF, [NAME OF NEW GUARANTOR], a ______________ has executed
and delivered this Annex I counterpart to the Guaranty as of this __________ day
of _________, ____.
[NAME OF NEW GUARANTOR]
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
87
EXHIBIT "B"
OPINION OF COUNSEL
The Agent and the Lenders who are parties to the
Credit Agreement described below.
January 15, 1998
Ladies and Gentlemen:
This is in regard to the Credit Agreement dated as of January 15, 1998
among FDX Corporation, the Lenders named therein and The First National Bank of
Chicago, as Agent (the "Agreement"). Unless the context otherwise requires, all
terms used in this opinion which are specifically defined in the Agreement shall
have the meanings given such terms in the Agreement.
I am the Senior Vice President and General Counsel of the Borrower and have
acted as such in connection with the Agreement. I, or attorneys under my
supervision, have made such examination and investigation as I or they have
deemed necessary in order to give the following opinion.
Based upon the foregoing, it is my opinion that:
1. The Borrower is a corporation duly incorporated and validly existing in
good standing under the laws of the State of Delaware. The Borrower is duly
authorized to execute and deliver the Agreement and perform its obligations
under the Agreement and to borrow under the Agreement. The Borrower has all
corporate power required to carry on its ordinary course of business.
2. Each Significant Subsidiary, and each Guarantor as of the date hereof,
is a corporation duly incorporated and validly existing in good standing under
the laws of the jurisdiction of its incorporation.
3. Each of the Borrower and each Significant Subsidiary and Guarantor as
of the date hereof is duly qualified as a foreign corporation in good standing
to do business in all jurisdictions where the failure to so qualify would have a
material adverse effect on the business of the Borrower and the Significant
Subsidiaries taken as a whole.
4. The execution and delivery of the Loan Documents by the Borrower and
each of the Guarantors, the borrowings by the Borrower under the Agreement and
the
88
performance by the Borrower and the Guarantors of their respective obligations
under the Loan Documents have been duly authorized by all necessary corporate
action and proceedings on the part of the Borrower and each Guarantor and do not
at this time:
(a) require any consent of the Borrower's or any Guarantor's
shareholders; or
(b) contravene, or constitute a default under, any provision of any
law or regulation applicable to the Borrower or any Guarantor or of the
certificate or articles of incorporation or by-laws of the Borrower or any
Guarantor or of any material contract, agreement, judgment, order, decree,
adjudication or other instrument binding upon the Borrower or any
Guarantor, or by which the Borrower or any Guarantor or any of their
respective property may be bound or affected, or result in the creation of
any Lien on any property now owned by the Borrower, any Guarantor or any
Significant Subsidiary pursuant to the provisions of any agreement,
indenture or other instrument binding upon it.
5. The Loan Documents delivered as of the date hereof have been duly
executed and delivered by the Borrower and each of the Guarantors, and
constitute the legal, valid and binding obligations of the Borrower and the
Guarantors, respectively, to the extent each is a party thereto, enforceable in
accordance with their terms, except as such enforceability may be limited by
bankruptcy or similar laws relating generally to the enforcement of creditors'
rights and subject also to the availability of equitable remedies if equitable
remedies are sought.
6. There is no action, suit, proceeding or investigation of which I am
aware pending or threatened against or affecting the Borrower, any Guarantor or
any Significant Subsidiary before any court, regulatory commission, arbitration
tribunal, governmental department, administrative agency or instrumentality
which, if such action, suit, proceeding or investigation were determined
adversely to the interest of the Borrower, the Guarantors and the Significant
Subsidiaries, would have a material, adverse effect on the business, condition
(financial or otherwise) or operations of the Borrower, any Guarantor or any
Significant Subsidiary, [except as discussed in the Borrower's Annual Report on
Form 10-K for the fiscal year ended May 31, 1997 as updated in the Borrower's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1997.]
7. Neither the Borrower nor any Guarantor or Significant Subsidiary is in
default or violation in any respect which would have a material adverse effect
on the business or condition (financial or otherwise) of the Borrower, any
Guarantor or any Significant Subsidiary with respect to any law, rule,
regulation, order, writ, judgment, injunction, decree, adjudication,
determination or award presently in effect and applicable to it.
8. No approval, authorization, consent, adjudication or order of any
governmental authority, which has not been obtained by the Borrower or any
Guarantor, is required to be obtained by the Borrower or any Guarantor in
connection with the execution and
89
delivery of the Loan Documents delivered as of the date hereof, the borrowings
under the Agreement or in connection with the performance by the Borrower or any
of the Guarantors of their respective obligations under the Loan Documents.
9. The Borrower is not engaged principally or as one of its important
activities in the business of extending credit for the purpose of purchasing or
carrying any "margin stock" (as such term is defined in Regulation U of the
Board of Governors of the Federal Reserve System).
10. The Borrower is not an "investment company", within the meaning of the
Investment Company Act of 1940, as currently in effect.
11. The laws of the State of Tennessee which limit interest rates or other
amounts payable with respect to borrowed money or interest thereon are not
applicable to the Agreement.
12. FedEx is not a national of any foreign country designated in
Presidential Executive Order No. 8389 or 9193, as amended, and the regulations
issued thereunder, as amended, or a national of any foreign country designated
in the Foreign Assets Control Regulations or in the Cuban Assets Control
Regulations of the United States Treasury Department, 31 C.F.R., Subtitle B,
Chapter V, as amended.
13. The certificates issued to FedEx pursuant to 49 U.S.C. Section
41102(a) and 49 U.S.C. Section 41103 and the operating certificates issued to
FedEx pursuant to Part 121 of the Federal Aviation Regulations are in full force
and effect and are adequate for the conduct of the business of the Borrower and
its Subsidiaries as now conducted. There are no actions, proceedings or
investigations pending or, to my knowledge, threatened (or any basis therefor
known to me) to amend, modify, suspend or revoke any such certificate in whole
or in part which would have any material adverse effect on any such certificate
or the operations of the Borrower and its Subsidiaries.
This opinion is limited to the effect of the laws of the State of
Tennessee, the General Corporation Law of the State of Delaware and the laws of
the United States of America, and I express no opinion with respect to the laws
of any other jurisdiction. As a result, I have with your permission assumed for
purposes of this opinion that, notwithstanding the contrary choice of law
provisions contained therein, the Loan Documents are governed by the laws of the
State of Tennessee.
This opinion may be relied upon by the Agent, the Lenders, and their
respective permitted participants, assignees, and other transferees. It is
understood that this opinion speaks as of the date given, notwithstanding any
delivery as contemplated above on any other date.
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EXHIBIT "C"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between ___________
______________ (the "Assignor") and ______________________ (the "Assignee") is
dated as of ________________, ____. The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement
(which, as it may be amended, modified, renewed or extended from time to time is
herein called the "Credit Agreement") described in Item 1 of Schedule 1 attached
hereto ("Schedule 1"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings attributed to them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement relating to the facilities listed in Item 3 of
Schedule 1 and the other Loan Documents. The aggregate Commitments (or Loans,
if the applicable Commitments have been terminated) purchased by the Assignee
hereunder are set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two Business Days (or such shorter period agreed to by the Agent) after a
Notice of Assignment substantially in the form of Exhibit "I" attached hereto
has been delivered to the Agent. Such Notice of Assignment must include any
consents required to be delivered to the Agent by Section 12.3.1 of the Credit
Agreement. In no event will the Effective Date occur if the payments required
to be made by the Assignee to the Assignor on the Effective Date under Sections
4 and 5 hereof are not made on the proposed Effective Date. The Assignor will
notify the Assignee of the proposed Effective Date no later than the Business
Day prior to the proposed Effective Date. As of the Effective Date, (i) the
Assignee shall have the rights and obligations of a Lender under the Loan
Documents with respect to the rights and obligations assigned to the Assignee
hereunder and (ii) the Assignor shall relinquish its rights and be released from
its corresponding obligations under the Loan Documents with respect to the
rights and obligations assigned to the Assignee hereunder.
4. PAYMENT OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal, interest
and fees with respect to the interest assigned hereby. The Assignee shall
advance funds directly to the Agent with respect to all Loans and reimbursement
payments made on or after the Effective Date with respect to the interest
assigned hereby. [In consideration for the sale and assignment of Loans
hereunder, (i) the Assignee shall pay the Assignor, on the Effective Date, an
amount equal to the principal amount of the portion of all Floating Rate Loans
assigned to the Assignee hereunder and (ii) with respect
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to each Eurodollar Loan made by the Assignor and assigned to the Assignee
hereunder which is outstanding on the Effective Date, (a) on the last day of the
Interest Period therefor or (b) on such earlier date agreed to by the Assignor
and the Assignee or (c) on the date on which any such Eurodollar Loan either
becomes due (by acceleration or otherwise) or is prepaid (the date as described
in the foregoing clauses (a), (b) or (c) being hereinafter referred to as the
"Payment Date"), the Assignee shall pay the Assignor an amount equal to the
principal amount of the portion of such Eurodollar Loan assigned to the Assignee
which is outstanding on the Payment Date. If the Assignor and the Assignee
agree that the Payment Date for such Eurodollar Loan shall be the Effective
Date, they shall agree to the interest rate applicable to the portion of such
Loan assigned hereunder for the period from the Effective Date to the end of the
existing Interest Period applicable to such Eurodollar Loan (the "Agreed
Interest Rate") and any interest received by the Assignee in excess of the
Agreed Interest Rate shall be remitted to the Assignor. If interest for the
period from the Effective Date to but not including the Payment Date is not paid
by the Borrower with respect to any Eurodollar Loan sold by the Assignor to the
Assignee hereunder, the Assignee shall pay to the Assignor interest for such
period on the portion of such Eurodollar Loan sold by the Assignor to the
Assignee hereunder at the applicable rate provided by the Credit Agreement. If
a prepayment of any Eurodollar Loan which is existing on the Payment Date and
assigned by the Assignor to the Assignee hereunder occurs after the Payment Date
but before the end of the Interest Period applicable to such Eurodollar Loan,
the Assignee shall remit to the Assignor the excess of the prepayment indemnity
paid with respect to the portion of such Eurodollar Loan assigned to the
Assignee hereunder over the amount which would have been paid if such prepayment
indemnity had been calculated based on the Agreed Interest Rate. The Assignee
will also promptly remit to the Assignor (i) any principal payments received
from the Agent with respect to Eurodollar Loans prior to the Payment Date and
(ii) any amounts of interest on Loans and fees received from the Agent which
relate to the portion of the Loans assigned to the Assignee hereunder for
periods prior to the Effective Date, in the case of Floating Rate Loans, or the
Payment Date, in the case of Eurodollar Loans, and not previously paid by the
Assignee to the Assignor.](1) If either party hereto receives any payment to
which the other party hereto is entitled under this Assignment Agreement, then
the party receiving such amount shall promptly remit it to the other party
hereto.
5. FEES PAYABLE BY THE ASSIGNEE. The [Assignee shall pay to the Assignor
a fee on each day on which a payment of interest or facility fees is made under
the Credit Agreement with respect to the amounts assigned to the Assignee
hereunder (other than a payment of interest or facility fees for the period
prior to the Effective Date or, in the case of Eurodollar Loans, the Payment
Date, which the Assignee is obligated to deliver to the Assignor pursuant to
Section 4 hereof). The amount of such fee shall be the difference between (i)
the interest or fee, as applicable, paid with respect to the amounts assigned to
the Assignee hereunder and (ii) the interest or fee, as applicable, which would
have been paid with respect to the amounts assigned to the Assignee hereunder if
each interest rate were __ of 1% less than the interest rate paid by the
Borrower or if the facility fee were __ of 1% less than the facility fee paid by
the Borrower, as
-------------------------
(1) Each Assignor may insert its standard payment provisions in lieu of
the payment terms included in this Exhibit.
92
applicable. In addition, the] Assignee agrees to pay % of the processing fee
required to be paid to the Agent in connection with this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim. It is understood and agreed
that the assignment and assumption hereunder are made without recourse to the
Assignor and that the Assignor makes no other representation or warranty of any
kind to the Assignee. Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) the due execution,
legality, validity, enforceability, genuineness, sufficiency or collectability
of any Loan Document, including without limitation, documents granting the
Assignor and the other Lenders a security interest in assets of the Borrower or
any guarantor, (ii) any representation, warranty or statement made in or in
connection with any of the Loan Documents, (iii) the financial condition or
creditworthiness of the Borrower or any guarantor, (iv) the performance of or
compliance with any of the terms or provisions of any of the Loan Documents, (v)
inspecting any of the Property, books or records of the Borrower, (vi) the
validity, enforceability, perfection, priority, condition, value or sufficiency
of any collateral securing or purporting to secure the Loans or (vii) any
mistake, error of judgment, or action taken or omitted to be taken in connection
with the Loans or the Loan Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement, (ii) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Loan Documents, (iii) appoints and authorizes the Agent to take
such action on its behalf and to exercise such powers under the Loan Documents
as are delegated to the Agent by the terms thereof, together with such powers as
are reasonably incidental thereto, (iv) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender, [and] (v) agrees
that its payment instructions and notice instructions are as set forth in the
attachment to Schedule 1, [and (vi) attaches the forms prescribed by the
Internal Revenue Service of the United States certifying that the Assignee is
entitled to receive payments under the Loan Documents without deduction or
withholding of any United States federal income taxes]. (2)
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys'
-------------------------
(2) To be inserted if the Assignee is not incorporated under the laws of
the United States, or a state thereof.
93
fees) and liabilities incurred by the Assignor in connection with or arising in
any manner from the Assignee's non-performance of the obligations assumed under
this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall
have the right or obligation pursuant to Article XII of the Credit Agreement to
assign the rights which are assigned to the Assignee hereunder to any entity or
person, provided that (i) any such subsequent assignment does not violate any of
the terms and conditions of the Loan Documents or any law, rule, regulation,
order, writ, judgment, injunction or decree and that any consent required under
the terms of the Loan Documents has been obtained and (ii) unless the prior
written consent of the Assignor is obtained, the Assignee is not thereby
released from its obligations to the Assignor hereunder, if any remain
unsatisfied, including, without limitation, its obligations under Sections 4, 5
and 8 hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the Aggregate
Commitment occurs between the date of this Assignment Agreement and the
Effective Date, [the percentage interests specified in Item 3 of Schedule 1
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment] [the dollar amounts specified in Item
4 of Schedule 1 shall remain the same, but the percentage interests purchased
shall be recalculated based on the reduced Aggregate Commitment].(3)
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice
of Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.
13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall be
the addresses set forth in the attachment to Schedule 1.
--------------------------
(3) At option of parties.
94
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
[NAME OF ASSIGNOR]
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
[NAME OF ASSIGNEE]
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
95
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
Credit Agreement dated as of January 15, 1998 by and among FDX Corporation,
the Lenders party thereto, and The First National Bank of Chicago, as Agent
2. Date of Assignment Agreement: _______, ___
3. Amounts (As of Date of Item 2 above):
a. Total of Tranche A Commitment
(Loans)(4) under
Credit Agreement $
-----
b. Total of Tranche B Commitment
(Loans) under
Credit Agreement $
-----
c. Assignee's Percentage
purchased under the
Assignment Agreement(5) %
-----
4. Assignee's (Tranche A Loan Amount)
Tranche A Commitment Amount
Purchased Hereunder: $
-----
Assignee's (Tranche B Loan Amount)
Tranche B Commitment Amount
Purchased Hereunder $
-----
5. Proposed Effective Date: ,
----- ----
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
--------------------------- ---------------------------
Title: Title:
------------------------ -----------------------
-----------------------
4 If a Commitment has been terminated, insert outstanding Loans in place
of Commitment.
5 Percentage taken to 10 decimal places.
96
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee
97
EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
,
-------------------- ---
To: FDX CORPORATION
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President and Treasurer
THE FIRST NATIONAL BANK OF CHICAGO
One First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to the Credit Agreement (the "Credit Agreement") described in
Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings attributed to
them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and delivered to
the Borrower and the Agent pursuant to Section 12.3.3 of the Credit Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of _____, __ (the "Assignment"), pursuant to which, among
other things, the Assignor has sold, assigned, delegated and transferred to the
Assignee, and the Assignee has purchased, accepted and assumed from the Assignor
the percentage interest specified in Item 3 of Schedule 1 of all outstandings,
rights and obligations under the Credit Agreement relating to the facilities
listed in Item 3 of Schedule 1, including, without limitation, such interest in
the Assignor's Commitments (if applicable) and the Loans owing to the Assignor
relating to such facilities. The Effective Date of the Assignment shall be the
later of the date specified in Item 5 of Schedule 1 to the Assignment ("Schedule
1") or two Business Days (or such shorter period as agreed to by the Agent)
after this Notice of Assignment and any consents and fees required by Sections
12.3.1 and 12.3.3 of the Credit Agreement have been delivered to the Agent,
provided that the Effective Date shall not occur if any condition precedent
agreed to by the Assignor and the Assignee has not been satisfied.
4. The Assignor and the Assignee hereby give to the Borrower and the
Agent notice of the assignment and delegation referred to herein. The Assignor
will confer with the Agent before the date specified in Item 5 of Schedule 1 to
determine if the Assignment Agreement will become effective on such
98
date pursuant to Section 3 hereof, and will confer with the Agent to determine
the Effective Date pursuant to Section 3 hereof if it occurs thereafter. The
Assignor shall notify the Agent if the Assignment Agreement does not become
effective on any proposed Effective Date as a result of the failure to satisfy
the conditions precedent agreed to by the Assignor and the Assignee. At the
request of the Agent, the Assignor will give the Agent written confirmation of
the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Agent on or before the
Effective Date the processing fee of $4,000 required by Section 12.3.3 of the
Credit Agreement.
6. If notes evidencing the Assignor's Loans are outstanding on the
Effective Date, the Assignor and the Assignee request and direct that the Agent
prepare and cause the Borrower to execute and deliver new notes or, as
appropriate, replacement notes, to the Assignor and the Assignee. The Assignor
and, if applicable, the Assignee each agree to deliver to the Agent the original
notes received by it from the Borrower upon its receipt of new notes in the
appropriate amounts.
7. The Assignee advises the Agent that its notice and payment
instructions are set forth in the attachment to Schedule 1.
8. Each party consenting to the Assignment in the space indicated below
hereby releases the Assignor from any obligations to it which have been assigned
to and assumed by the Assignee.
NAME OF ASSIGNOR NAME OF ASSIGNEE
By: By:
-------------------------------- --------------------------------
Name: Name:
------------------------------- -------------------------------
Title: Title:
------------------------------ ------------------------------
Acknowledged by and Acknowledged by and
Consented to: Consented to:
THE FIRST NATIONAL BANK OF FDX CORPORATION
CHICAGO, as Agent
By: By:
-------------------------------- --------------------------------
Name: Name:
------------------------------- -------------------------------
Title: Title:
------------------------------ ------------------------------
[Attach photocopy of Schedule 1 to Assignment]
99
EXHIBIT "D"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To The First National Bank of Chicago,
as Agent (the "Agent") under the Credit Agreement
described below.
Re: Credit Agreement, dated as of January 15, 1998 (as the same may be amended
or modified, the "Credit Agreement"), among FDX Corporation (the
"Borrower"), the Agent, and the Lenders named therein
-----------------------------------------------------
Terms used herein and not otherwise defined shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the following
standing money transfer instructions with respect to the proceeds of Advances or
other extensions of credit from time to time until receipt by the Agent of a
specific written revocation of such instructions by the Borrower, provided,
however, that the Agent may otherwise transfer funds as hereafter directed in
writing by the Borrower in accordance with Section 13.1 of the Credit Agreement
or based on any telephonic notice made in accordance with Section 2.13 of the
Credit Agreement.
Facility Identification Number(s)
-------------------------
Customer/Account Name
-------------------------
Transfer Funds To
-------------------------
-------------------------
-------------------------
For Account No.
-------------------------
Reference/Attention To
-------------------------
Authorized Officer (Customer Representative) Date
-------------------------
------------------------------ ------------------------------
(Please Print) Signature
Authorized Officer (Customer Representative) Date
-------------------------
------------------------------ ------------------------------
(Please Print) Signature
Lender Officer Name Date
-------------------------
------------------------------ ------------------------------
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
100
SCHEDULE "1"
SIGNIFICANT SUBSIDIARIES
(SEE SECTION 5.7)
Significant Percent Jurisdiction of
Subsidiary Ownership Organization
---------- --------- ------------
Federal Express Corporation 100% Delaware
RPS, Inc. 100% Delaware
▇▇▇▇▇▇▇ Express, Inc. 100% Ohio
Caliber System, Inc. 100% Ohio
Federal Express Canada Ltd. 100% Canada
Federal Express (Hong Kong)
Limited(6) 100% Hong Kong
------------------------
(6) Federal Express (Hong Kong) Limited is a wholly-owned subsidiary of
Federal Express International, Inc.
101
SCHEDULE "2"
COMPLIANCE CALCULATIONS
(See Section 6.1(iv))
SEE ATTACHED
102
FDX CORPORATION
COMPLIANCE CALCULATIONS
REVOLVING CREDIT AGREEMENT, DATED AS OF JANUARY 15, 1998
IN THOUSANDS OF US$
PAGE 1 OF 2
SECTION 6.12
LEVERAGE RATIO
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
FY___ FY___ FY___ FY___
1. Funded Debt $ $ $ $
-------- -------- -------- --------
2. Capitalized Operating Lease Value* $ $ $ $
-------- -------- -------- --------
3. Total Debt (sum of line 1 and line 2) $ $ $ $
-------- -------- -------- --------
4. Total Debt
5. Consolidated Adjusted Net Worth $ $ $ $
-------- -------- -------- --------
6. Capitalization (sum of line 4 and line 5) $ $ $ $
-------- -------- -------- --------
7. Leverage Ratio** $ $ $ $
-------- -------- -------- --------
Maximum Leverage Ratio 0.70 0.70 0.70 0.70
*Capitalized Operating Lease Value is the present value of Aircraft Leases
discounted at 12.5%.
**The Leverage Ratio is Total Debt to Capitalization (line 3 divided by line 6).
103
FDX CORPORATION
COMPLIANCE CALCULATIONS
REVOLVING CREDIT AGREEMENT, DATED AS OF JANUARY 15, 1998
IN THOUSANDS OF US$
PAGE 2 OF 2
SECTION 6.13
FIXED CHARGE COVERAGE RATIO
Prior Fiscal Year Detail 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
FY___ FY___ FY___ FY___
Income (loss) Before Income Taxes $ $ $ $
-------- -------- -------- --------
Interest Expense $ $ $ $
-------- -------- -------- --------
Rent Expense $ $ $ $
-------- -------- -------- --------
Consolidated Cash Flow* $ $ $ $
-------- -------- -------- --------
Interest Expense $ $ $ $
-------- -------- -------- --------
Rent Expense $ $ $ $
-------- -------- -------- --------
Total Fixed Charges** $ $ $ $
-------- -------- -------- --------
Current Fiscal Year Detail 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
FY___ FY___ FY___ FY___
Income (loss) Before Income Taxes $ $ $ $
-------- -------- -------- --------
Interest Expense $ $ $ $
-------- -------- -------- --------
Rent Expense $ $ $ $
-------- -------- -------- --------
Consolidated Cash Flow $ $ $ $
-------- -------- -------- --------
Interest Expense $ $ $ $
-------- -------- -------- --------
Rent Expense $ $ $ $
-------- -------- -------- --------
Total Fixed Charges $ $ $ $
-------- -------- -------- --------
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
FY___ FY___ FY___ FY___
12 Month Consolidated Cash Flow $ $ $ $
-------- -------- -------- --------
Divided by:
12 Month Total Fixed Charges $ $ $ $
-------- -------- -------- --------
Equals:
Fixed Charge Coverage $ $ $ $
-------- -------- -------- --------
Minimum Fixed Charge Coverage Ratio
Allowed through February 28, 1999 1.20 1.20 1.20 1.20
Minimum Fixed Charge Coverage Ratio
Allowed through February 28, 1999 1.25 1.25 1.25 1.25
12 Month Consolidated Cash Flow
Over/(Under) $ $ $ $
-------- -------- -------- --------
*Consolidated Cash Flow is the sum of Income/(Loss) Before Taxes, Interest and
Rent Expense.
**Total Fixed Charges is the sum of Interest Expense and Rent Expense.
The Ratio is calculated on a rolling 12 months basis to eliminate the
seasonality of Income/(Loss) Before Tax.
2