[CONFORMED COPY]
$405,000,000
TERM LOAN AGREEMENT
dated as of
January 28, 1998
among
The ▇▇▇▇▇ ▇▇▇▇▇▇ Companies Inc.,
as Borrower,
▇▇▇▇▇ ▇▇▇▇▇▇ Inc.,
as Guarantor
The Banks Listed Herein,
▇▇▇▇▇▇ Guaranty Trust Company of New York,
as Administrative Agent
and
The Chase Manhattan Bank
and
Citibank, N.A.
as Co-Documentation Agents
-----------------------
(NY) 27009/420/CA/ca.term.conf.wpd
PAGE
TABLE OF CONTENTS
---------------
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions.......................................1
SECTION 1.02. Accounting Terms and Determinations..............13
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend..............................14
SECTION 2.02. Notice of Borrowing..............................14
SECTION 2.03. Notice to Banks; Funding of Loans................14
SECTION 2.04. Notes............................................15
SECTION 2.05. Maturity of Loans................................16
SECTION 2.06. Interest Rates...................................16
SECTION 2.07. Method of Electing Interest Rates................17
SECTION 2.08. Mandatory Termination of Commitments.............18
SECTION 2.09. Optional Prepayments.............................19
SECTION 2.10. General Provisions as to Payments................19
SECTION 2.11. Funding Losses...................................20
SECTION 2.12. Computation of Interest and Fees.................20
SECTION 2.13. Regulation D Compensation........................20
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing..........................................21
SECTION 3.02. Borrowing........................................21
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power....................22
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention.............................................22
SECTION 4.03. Binding Effect...................................23
SECTION 4.04. Financial Information............................23
SECTION 4.05. Litigation.......................................23
SECTION 4.06. Compliance with ERISA............................23
PAGE
SECTION 4.07. Environmental Matters............................24
SECTION 4.08. Taxes............................................24
SECTION 4.09. Subsidiaries.....................................24
SECTION 4.10. Regulatory Restrictions on Borrowing.............25
SECTION 4.11. Full Disclosure..................................25
ARTICLE 5
COVENANTS
SECTION 5.01. Information......................................25
SECTION 5.02. Payment of Obligations...........................27
SECTION 5.03. Insurance........................................28
SECTION 5.04. Conduct of Business and Maintenance of Existence.28
SECTION 5.05. Compliance with Laws.............................28
SECTION 5.06. Inspection of Property, Books and Records........29
SECTION 5.07. Mergers and Sales of Assets......................29
SECTION 5.08. Use of Proceeds..................................29
SECTION 5.09. Negative Pledge..................................29
SECTION 5.10. Debt to Total Capital............................31
SECTION 5.11. Interest Coverage Ratio..........................31
SECTION 5.12. Debt of Subsidiaries.............................31
SECTION 5.13. Transactions with Affiliates.....................31
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default................................32
SECTION 6.02. Notice of Default................................34
ARTICLE 7
THE AGENTS
SECTION 7.01. Appointment and Authorizations...................35
SECTION 7.02. Agents and Affiliates............................35
SECTION 7.03. Action by Agents.................................35
SECTION 7.04. Consultation with Experts........................35
SECTION 7.05. Liability of Agents..............................35
SECTION 7.06. Indemnification..................................36
SECTION 7.07. Credit Decision..................................36
SECTION 7.08. Successor Agents.................................36
ii
PAGE
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair........................................37
SECTION 8.02. Illegality.......................................37
SECTION 8.03. Increased Cost and Reduced Return................38
SECTION 8.04. Taxes............................................39
SECTION 8.05. Base Rate Loans Substituted for Affected
Euro-Dollar Loans................................41
SECTION 8.06. Substitution of Banks............................41
ARTICLE 9
MISCELLANEOUS
SECTION 9.01. Notices..........................................42
SECTION 9.02. No Waivers.......................................42
SECTION 9.03. Expenses; Indemnification........................42
SECTION 9.04. Sharing of Set-Offs..............................43
SECTION 9.05. Amendments and Waivers...........................44
SECTION 9.06. Successors and Assigns...........................44
SECTION 9.07. Collateral.......................................46
SECTION 9.08. Governing Law, Submission to Jurisdiction........46
SECTION 9.09. Counterparts; Integration; Effectiveness.........46
SECTION 9.10. WAIVER OF JURY TRIAL.............................47
SECTION 9.11. Confidentiality..................................47
ARTICLE 10
GUARANTY
SECTION 10.01. The Guaranty....................................48
SECTION 10.02. Guaranty Unconditional..........................48
SECTION 10.03. Discharge Only upon Payment in Full;
Reinstatement In Certain Circumstances..........49
SECTION 10.04. Waiver by the Guarantor.........................49
SECTION 10.05. Subrogation.....................................49
SECTION 10.06. Stay of Acceleration............................49
SECTION 10.07. Limitation of Liability.........................50
iii
PAGE
EXHIBIT A - Note
EXHIBIT B - Opinion of Counsel for the Obligors
EXHIBIT C - Opinion of Special Counsel for the Agents
EXHIBIT D - Assignment and Assumption Agreement
iv
AGREEMENT dated as of January 28, 1998 among THE ▇▇▇▇▇ ▇▇▇▇▇▇ COMPANIES
INC., as Borrower, ▇▇▇▇▇ ▇▇▇▇▇▇ INC., as Guarantor, the BANKS listed on the
signature pages hereof, ▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK, as
Administrative Agent, and THE CHASE MANHATTAN BANK and CITIBANK, N.A., as
CoDocumentation Agents.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have
the following meanings:
"ADMINISTRATIVE AGENT" means ▇▇▇▇▇▇ Guaranty Trust Company of New York in
its capacity as Administrative Agent for the Banks hereunder, and its successors
in such capacity.
"ADMINISTRATIVE QUESTIONNAIRE" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent (with a copy to the Borrower) duly
completed by such Bank.
"AFFILIATE" means (i) any Person that directly, or indirectly through one
or more intermediaries, controls the Guarantor (a "CONTROLLING PERSON") or (ii)
any Person (other than the Guarantor or a Subsidiary) which is controlled by or
is under common control with a Controlling Person. As used herein, the term
"CONTROL" means possession, directly or indirectly, of the power to vote
securities constituting 10% or more of the voting power represented by all of
the outstanding voting securities of a Person or to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"AGENTS" means the Co-Documentation Agents and the Administrative Agent,
and "AGENT" means anyone of them.
"APPLICABLE LENDING OFFICE" means, with respect to any Bank, (i) in the
case of its Base Rate Loans, its Domestic Lending Office and (ii) in the case of
its Euro-Dollar Loans, its Euro-Dollar Lending Office.
"ASSIGNEE" has the meaning set forth in Section 9.06(c) .
"AVAILABILITY PERIOD" means the period from and including the Closing Date
to and including the Commitment Termination Date.
"BANK" means each bank listed on the signature pages hereof, each Assignee
which becomes a Bank pursuant to Section 9.06(c) , and their respective
successors.
"BASE RATE" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal
Funds Rate for such day.
"BASE RATE LOAN" means (i) the Loan of a Bank (or any portion thereof) at
any time during which it bears interest at the Base Rate pursuant to the
provisions of Article 8 or (ii) an overdue amount which was a Base Rate Loan
immediately before it became overdue.
"BENEFIT ARRANGEMENT" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the ERISA
Group.
"BORROWER" means The ▇▇▇▇▇ ▇▇▇▇▇▇ Companies Inc., a Delaware corporation,
and its successors.
"BORROWING" means the borrowing hereunder consisting of a single loan made
to the Borrower by each Bank pursuant to Article 2.
"BORROWING DATE" means the date the Borrowing is made pursuant to
Article 2.
"CLOSING DATE" means the date on or after the Effective Date on which the
Co-Documentation Agents shall have received the documents specified in or
pursuant to Section 3.01.
"CO-DOCUMENTATION AGENTS" means The Chase Manhattan Bank and Citibank,
N.A., each in its capacity as Co-Documentation Agent for the Banks hereunder,
and its successors in such capacity, and "CO-DOCUMENTATION AGENT" means either
one.
"COMMITMENT" means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, until such amount
is reduced to zero pursuant to Sections 2.08.
2
"COMMITMENT TERMINATION DATE" means February 2, 1998.
"CONSOLIDATED EBITDA" means, for any period, Consolidated Net Income for
such period plus, to the extent deducted in determining Consolidated Net Income
for such period, the aggregate amount of (i) Consolidated Interest Expense, (ii)
income tax expense and (iii) depreciation, amortization and other similar
non-cash charges.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the interest
expense of the Borrower and its Consolidated Subsidiaries, determined on a
consolidated basis for such period.
"CONSOLIDATED NET INCOME" means, for any period, the net income of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated basis
for such period, adjusted to exclude the effect of any extraordinary or other
non-recurring gain or loss.
"CONSOLIDATED DEBT" means at any date the average of the Debt of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated basis,
at the last day of each of the four consecutive fiscal quarters of the Borrower
ended on or most recently prior to such date.
"CONSOLIDATED SUBSIDIARY" means at any date any Subsidiary or other entity
the accounts of which would be consolidated with those of the Borrower in its
consolidated financial statements if such statements were prepared as of such
date.
"CONSOLIDATED TANGIBLE NET WORTH" means at any date the consolidated
stockholders' equity of the Borrower and its Consolidated Subsidiaries
(excluding for this purpose any amount attributable to stock which is required
to be redeemed, or is redeemable at the option of the holder, if certain events
or conditions occur or exist or otherwise, other than shares of the Borrower's
$6.50 cumulative redeemable preferred stock, par value $.01 per share,
outstanding on the date of this Agreement) less their consolidated Intangible
Assets, all determined as of such date. For purposes of this definition,
"INTANGIBLE ASSETS" means the amount (to the extent reflected in determining
such consolidated stockholders' equity) of (i) all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of assets
of a going concern business made within twelve months after the acquisition of
such business) subsequent to the date hereof in the book value of any asset
owned by the Borrower or a Consolidated Subsidiary, (ii) all investments in
unconsolidated Subsidiaries and all equity investments in Persons which are not
Subsidiaries and (iii) all unamortized debt discount and expense, unamortized
deferred charges, goodwill,
3
patents, trademarks, service marks, trade names, anticipated future benefit of
tax loss carry-forwards, copyrights, organization or developmental expenses and
other intangible assets.
"DEBT" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (v) all non-contingent
obligations (and, for purposes of Section 5.09 and the definitions of Material
Debt and Material Financial Obligations, all contingent obligations) of such
Person to reimburse any bank or other Person in respect of amounts paid under a
letter of credit or similar instrument, (vi) all Debt secured by a Lien on any
asset of such Person, whether or not such Debt is otherwise an obligation of
such Person and (vii) all Debt of others Guaranteed by such Person.
"DEBT TO CAPITAL RATIO" means at any date the ratio of (i) Consolidated
Debt to (ii) Total Capital, in each case determined at such date.
"DEFAULT" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"DERIVATIVES OBLIGATIONS" of any Person means all obligations of such
Person in respect of any rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
"DOMESTIC BUSINESS DAY" means any day except a Saturday, Sunday or other
day on which commercial banks in New York City are authorized by law to close.
"DOMESTIC LENDING OFFICE" means, as to each Bank, its office located at
its address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Administrative Agent.
4
"EFFECTIVE DATE" means the date this Agreement becomes effective in
accordance with Section 9.09.
"ENVIRONMENTAL LAWS" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to the
environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, Hazardous Substances or wastes or the
clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA GROUP" means the Borrower, any Subsidiary and 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
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"EURO-DOLLAR BUSINESS DAY" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"EURO-DOLLAR LENDING OFFICE" means, as to each Bank, its office, branch or
affiliate located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire as its Euro-Dollar Lending
Office) or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Euro-Dollar Lending Office by notice to the Borrower
and the Administrative Agent.
"EURO-DOLLAR LOAN" means (i) the Loan of a Bank (or any portion thereof)
at any time during which it bears interest at a Euro-Dollar Rate pursuant to the
Notice of Borrowing or applicable Notice of Interest Rate Election or (ii) an
overdue amount which was a Euro-Dollar Loan immediately before it became
overdue.
"EURO-DOLLAR RATE" means a rate of interest determined pursuant to Section
2.06(b) on the basis of the London Interbank Offered Rate.
5
"EURO-DOLLAR RESERVE PERCENTAGE" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "EUROCURRENCY LIABILITIES" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
EuroDollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents).
"EVENT OF DEFAULT" has the meaning set forth in Section 6.01.
"EXISTING CREDIT AGREEMENT" means the Credit Agreement dated as of July 1,
1996 among the Guarantor (there, as borrower), the Borrower (there, as
guarantor), the Banks listed therein, ▇▇▇▇▇▇ Guaranty Trust Company of New York,
as Administrative Agent, and Deutsche Bank AG, New York Branch, as Documentation
Agent.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) 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 by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to ▇▇▇▇▇▇ Guaranty Trust Company of New
York on such day on such transactions as determined by the Administrative Agent.
"GROUP OF LOANS" means at any time a portion of the Loans consisting of
(i) all portions of the Loans which are Base Rate Loans at such time or (ii) all
portions of the Loans which are Euro-Dollar Loans having the same Interest
Period at such time, provided that, if a Loan of any particular Bank is
converted to or made as a Base Rate Loan pursuant to Article 8, such Loan shall
be included in the same Group or Groups of Loans from time to time as it would
have been in if it had not been so converted or made.
"GUARANTEE" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
6
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt (whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the holder of such Debt of the
payment thereof or to protect such holder against loss in respect thereof (in
whole or in part), provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "GUARANTEE" used as a verb has a corresponding meaning.
"GUARANTOR" means ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., a Delaware corporation, and its
successors.
"GUARANTY" means the obligations of the Guarantor set forth in Article 10.
"HAZARDOUS SUBSTANCES" means any toxic, radioactive, caustic or otherwise
hazardous substance, including petroleum, its derivatives, by-products and other
hydrocarbons, or any substance having any constituent elements displaying any of
the foregoing characteristics.
"INDEMNITEE" has the meaning set forth in Section 9.03(b).
"INTEREST PERIOD" means, with respect to each Euro-Dollar Loan, the period
commencing on the date of borrowing specified in the Notice of Borrowing or on
the date specified in the applicable Notice of Interest Rate Election and ending
one, two, or three months thereafter, as the Borrower may elect in the
applicable notice; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar
Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Euro-Dollar Business
Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clause (c) below, end on the
last Euro-Dollar Business Day of a calendar month; and
7
(c) any Interest Period which would otherwise end after the
Maturity Date shall end on the Maturity Date.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"LAUDER FAMILY MEMBER" means (i) Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and her estate,
guardian, conservator or committee, (ii) each descendant of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇
(each such Person, a "LAUDER DESCENDANT") and their respective estates,
guardians, conservators or committees, (iii) each Family Controlled Entity, (iv)
each Current Spouse of Lauder Descendants and (v) the trustees, in their
respective capacities as such, of each Family Controlled Trust. As used herein,
"FAMILY CONTROLLED ENTITY" means (w) any not-for-profit corporation if at least
a majority of its board of directors is composed of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and/or
Lauder Descendants and/or Current Spouses of Lauder Descendants, (x) any other
corporation if (i) both (aa) Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and/or Lauder Descendants and/or
Current Spouses of Lauder Descendants (or in the case of subclause (i)(aa)(xx),
their respective estates, guardians, conservators or committees) (xx) hold in
the aggregate, directly or indirectly through one or more wholly owned Persons,
securities having ordinary voting power to elect a majority of the board of
directors of such corporation or (yy) constitute a majority of the board of
directors of such corporation and (bb) at least a majority of the value of the
outstanding equity of such corporation is owned by Lauder Family Members or (ii)
at least 80% of the value of the outstanding equity of such corporation is owned
by Lauder Family Members, (y) any partnership if at least a majority of the
value of its partnership interests (both general and limited) are owned by
Lauder Family Members, and (z) any limited liability or similar company if (i)
both (aa) Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and/or Lauder Descendants and/or Current Spouses of
Lauder Descendants (or, in the case of subclause (i)(aa)(xx), their respective
estates, guardians, conservators or committees) (xx) hold in the aggregate,
directly or indirectly through one or more wholly owned Persons, securities or
other equity interests having ordinary voting power to elect or appoint at least
a majority of the managing members of such company or (yy) constitute a majority
of the managing members of such company and (bb) a majority of the value of such
company is owned by Lauder Family Members or (ii) at least 80% of the value of
such company is owned by Lauder Family Members. As used herein, "FAMILY
CONTROLLED TRUST" shall mean any trust the primary beneficiaries of which are
Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇, Lauder Descendants, Spouses of Lauder Descendants and/or
charitable organizations (collectively, "LAUDER BENEFICIARIES"); provided, that,
if the trust is a wholly charitable trust, at least a majority of the trustees
of such trust consist of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and/or Lauder Descendants and/or
Current Spouses of Lauder Descendants. For purposes of the definition of "FAMILY
CONTROLLED TRUST", the primary beneficiaries of a trust will be deemed to be
Lauder
8
Beneficiaries if, under the maximum exercise of discretion by the trustee in
favor of persons who are neither Lauder Beneficiaries nor Family Controlled
Trusts, the value of the interests of such persons in such trust, computed
actuarially, is less than 50%. In determining the primary beneficiaries of a
trust for purposes of the definition of "FAMILY CONTROLLED TRUST", (A) the
factors and methods prescribed in section 7520 of the Internal Revenue Code of
1986, as amended, for use in ascertaining the value of certain interests shall
be used in determining a beneficiary's actuarial interest in a trust, (B) the
actuarial value of the interest in a trust of any person in whose favor a
testamentary power of appointment may be exercised shall be deemed to be zero
and (C) in the case of a trust created by one or more of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or Lauder Descendants, the actuarial value of the interest in
such trust of any person who may receive trust property only at the termination
of the trust and then only in the event that, at the termination of the trust,
there are no living issue of one or more of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
or Lauder Descendants shall be deemed to be zero. For purposes hereof, (1)
"SPOUSES OF LAUDER DESCENDANTS" means those individuals who at any time were
married to any Lauder Descendant whether or not such marriage is subsequently
dissolved by death, divorce, or by any other means, (2) "CURRENT SPOUSE OF
LAUDER DESCENDANTS" means an individual who is married to a Lauder Descendant,
but only so long as such marriage has not been dissolved by death, divorce or by
any other means, (3) the relationship of any person that is derived by or
through legal adoption shall be considered a natural relationship, (4) a minor
who is a descendant of Mrs. ▇▇▇▇▇ ▇▇▇▇▇▇ and for whom equity interests are held
pursuant to a Uniform Gifts to Minors Act or similar law shall be considered the
holder of such equity interests and the custodian who is the record holder of
such equity interests shall not be considered the holder thereof, (5) an
incompetent stockholder of any equity interests whose equity interests are owned
or held by a guardian or conservator shall be considered the holder of such
equity interest and such guardian or conservator who is the holder of such
equity interests shall not be considered the holder thereof, (6) any equity
interests pledged by a holder thereof as security for any obligation shall be
deemed to be held by such holder unless and until the pledgee of such equity
interests has declared a default with respect to such obligation and has the
right (whether or not being presently exercised) to vote or direct the voting of
such equity interests and (7) except as provided in clauses (4), (5) and (6)
above, the holder of any equity interests shall mean the record holder of such
equity interests; provided, however, that if such record holder of such equity
interests is a nominee, the holder of such equity interests shall be the first
person in the chain of ownership of such equity interests who is not holder
thereof solely as a nominee.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
9
preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this Agreement, the
Borrower or any Subsidiary shall be deemed to own subject to a Lien any asset
which it has acquired or holds subject to the interest of a vendor or lessor
under any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"LOAN" has the meaning set forth in Section 2.01.
"LONDON INTERBANK OFFERED RATE" has the meaning set forth in Section
2.06(b) .
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the business,
financial position or results of operations of the Borrower and its Consolidated
Subsidiaries, taken as a whole.
"MATERIAL DEBT" means Debt (other than the Notes) of the Borrower and/or
one or more of its Subsidiaries, arising in one or more related or unrelated
transactions, in an aggregate principal or face amount exceeding $20,000,000.
"MATERIAL FINANCIAL OBLIGATIONS" means a principal or face amount of Debt
and/or payment or collateralization obligations in respect of Derivatives
Obligations of the Borrower and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, exceeding in the aggregate
$20,000,000.
"MATERIAL PLAN" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $20,000,000.
"MATURITY DATE" means February 1, 2005 or, if such day is not a Euro-
Dollar Business Day, the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
Maturity Date shall be the next preceding Euro-Dollar Business Day.
"MULTIEMPLOYER PLAN" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"NOTES" means promissory notes of the Borrower, substantially in the form
of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
Loans, and "NOTE" means any one of such promissory notes issued hereunder.
10
"NOTICE OF BORROWING" has the meaning set forth in Section 2.02.
"NOTICE OF INTEREST RATE ELECTION" has the meaning set forth in Section
2.07.
"OBLIGORS" means the Borrower and the Guarantor, and "OBLIGOR" means
either one.
"PARENT" means, with respect to any Bank, any Person controlling such
Bank.
"PARTICIPANT" has the meaning set forth in Section 9.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERSON" means an individual, a corporation, a limited liability company,
a partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"PLAN" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"PRIME RATE" means the rate of interest publicly announced by ▇▇▇▇▇▇
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.
"PROSPECTUS" means the final prospectus dated as of November 16, 1995
included in Registration Statement No. 33-97180 of the Guarantor on Form S-1.
"QUARTERLY DATES" means each March 31, June 30, September 30 and December
31.
"REGULATION U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
11
"REQUIRED BANKS" means at any time Banks having in excess of 50% of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing in excess of 50% of the aggregate unpaid
principal amount of the Loans.
"SENIOR OFFICER" means, with respect to any Person, the chief executive
officer, the chief operating officer, the president, the chief financial
officer, the general counsel, the chief accounting officer or the treasurer of
such Person (or in any case persons having substantially similar
responsibilities regardless of title).
"SHARES" means shares of common stock of the Borrower (which shares may be
shares of Class A common stock or Class B common stock).
"SIGNIFICANT SUBSIDIARY" means at any time a Subsidiary that as at that
time would be a "SIGNIFICANT SUBSIDIARY" as defined in Rule 1-02 of Regulation
S-X promulgated by the Securities and Exchange Commission as in effect on the
date hereof, provided that the Guarantor is always a Significant Subsidiary.
"SUBSIDIARY" means, as to any Person, any corporation or other entity of
which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person; unless
otherwise specified, "SUBSIDIARY" means a Subsidiary of the Borrower.
"TOTAL CAPITAL" means, at any date, the sum of (x) Consolidated Debt plus
(y) consolidated stockholders' equity of the Borrower and its Consolidated
Subsidiaries (excluding for this purpose any amount attributable to stock which
is required to be redeemed, or is redeemable at the option of the holder, if
certain events or conditions occur or exist or otherwise, other than shares of
the Borrower's $6.50 cumulative redeemable preferred stock, par value $.01 per
share, outstanding on the date of this Agreement), in each case determined at
such date.
"TRIGGER DATE" means the first date on which:
(a) any of the terms of Sections 4.2(a), 4.2(c)(i),
4.2(c)(ii), 4.2(c)(iii), 4.2(c)(iv) or 4.2(d) of the Restated
Certificate of Incorporation of the Borrower, as in effect on the
date of this Agreement (the "CERTIFICATE OF INCORPORATION"), are
amended or modified in any manner; or
(b) the Borrower issues any class of preferred stock having
greater voting rights than the voting rights of the holders of the
12
shares of $6.50 cumulative redeemable preferred stock, par value
$.01 per share, under the Certificate of Incorporation or has
outstanding one or more classes or series of preferred stock the
holders of which, in the aggregate, are under all circumstances or
upon the occurrence of a contingency that has occurred entitled to
elect a majority of the board of directors of the Borrower; or
(c) the Borrower issues, or the Certificate of Incorporation
is amended to authorize the issuance of, any class of stock with any
right to elect any director to the board of directors of the
Borrower (regardless of whether such right may be exercised under
all circumstances or solely upon the occurrence of a contingency)
not authorized to be issued on the date of this Agreement; or
(d) the outstanding shares of Class B common stock of the
Borrower are converted into shares of Class A common stock of the
Borrower pursuant to the terms of Section 4.2(d)(i) of the
Certificate of Incorporation.
"UNFUNDED LIABILITIES" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"UNITED STATES" means the United States of America, including the States
and the District of Columbia, but excluding its territories and possessions.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time, applied
on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks; provided that, if the Borrower notifies the Administrative Agent
that the Borrower wishes to amend any covenant in Article 5 to eliminate the
effect of any change in generally accepted accounting principles on the
operation of such covenant (or if the
13
Administrative Agent notifies the Borrower that the Required Banks wish to amend
Article 5 for such purpose), then the Borrower's compliance with such covenant
shall be determined on the basis of generally accepted accounting principles in
effect immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Guarantor, the Borrower and
the Required Banks.
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend. (a) Each Bank severally agrees, on the
terms and conditions set forth in this Agreement, to make a single loan (its
"Loan" and collectively the "Loans") to the Borrower on any Euro-Dollar Business
Day during the Availability Period in an amount equal to the amount of its
Commitment. The Borrowing shall be made from the several Banks ratably in
proportion to their respective Commitments and, subject to Article 8, shall
consist solely of Euro-Dollar Loans. The Commitments are not revolving in
nature, and amounts repaid or prepaid may not be reborrowed.
SECTION 2.02. Notice of Borrowing. The Borrower shall give the
Administrative Agent notice (the "NOTICE OF BORROWING") not later than 10:30
A.M. (New York City time) on the third Euro-Dollar Business Day before the
Borrowing Date specifying:
(i) the Borrowing Date, which shall be a Euro-Dollar Business Day; and
(ii) the duration of the Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
SECTION 2.03. Notice to Banks; Funding of Loans. (a) Upon receipt of the
Notice of Borrowing, the Administrative Agent shall promptly notify each Bank of
the contents thereof and of such Bank's share of the Borrowing and such Notice
of Borrowing shall not thereafter be revocable by the Borrower.
(b) Not later than 12:00 Noon (New York City time) on the Borrowing Date,
each Bank shall make available its share of the Borrowing, in Federal or other
funds immediately available in New York City, to the Administrative Agent at its
address referred to in Section 9.01 . Unless the Administrative Agent
14
determines that any applicable condition specified in Article 3 has not been
satisfied, the Administrative Agent will make the funds so received from the
Banks available to the Borrower at the Administrative Agent's aforesaid address.
(c) Unless the Administrative Agent shall have received notice from a Bank
prior to the Borrowing Date that such Bank will not make available to the
Administrative Agent such Bank's share of the Borrowing, the Administrative
Agent may assume that such Bank has made such share available to the
Administrative Agent on the Borrowing Date in accordance with subsection (b) of
this Section and the Administrative Agent may, in reliance upon such assumption,
make available to the Borrower on such date a corresponding amount. If and to
the extent that such Bank shall not have so made such share available to the
Administrative Agent, such Bank and the Borrower severally agree to repay to the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Borrower until the date such amount is repaid to the Administrative Agent,
at (i) in the case of the Borrower, a rate per annum equal to the higher of the
Federal Funds Rate and the interest rate applicable thereto pursuant to Section
2.06 and (ii) in the case of such Bank, the Federal Funds Rate. If such Bank
shall repay to the Administrative Agent such corresponding amount, such amount
so repaid shall constitute such Bank's Loan included in such Borrowing for
purposes of this Agreement.
SECTION 2.04. Notes. (a) The Loan of each Bank shall be evidenced by a
single Note payable to the order of such Bank for the account of its Applicable
Lending Office in an amount equal to the aggregate unpaid principal amount of
such Bank's Loan.
(b) Each Bank may, by notice to the Borrower and the Administrative Agent,
request that a portion of its Loan of a particular type be evidenced by a
separate Note in an amount equal to the aggregate unpaid principal amount of
such portion. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely portions of a Loan of the relevant type. Each reference in this Agreement
to the '"NOTE" of such Bank shall be deemed to refer to and include any or all
of such Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.01(a), the
Administrative Agent shall forward such Note to such Bank. Each Bank shall
record the date and amount of its Loan and all repayments of principal thereof
and may, if such Bank so elects in connection with any transfer or enforcement
of its Note, endorse on the schedule forming a part thereof appropriate
notations to evidence the foregoing information with respect to such Loan;
provided that the
15
failure of any Bank to make any such recordation or endorsement shall not affect
the obligations of the Borrower hereunder or under the Notes. Each Bank is
hereby irrevocably authorized by the Borrower so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as and
when required.
SECTION 2.05. Maturity of Loans. The Loans shall mature, and the
principal amount thereof shall be due and payable, on the Maturity Date.
SECTION 2.06. Interest Rates. (a) Each Loan (or portion thereof) when it
is a Base Rate Loan shall bear interest on the outstanding principal amount
thereof, for each day it is a Base Rate Loan until it becomes due, at a rate per
annum equal to the Base Rate for such day. Such interest shall be payable
quarterly in arrears on each Quarterly Date and, with respect to the principal
amount of any Base Rate Loan converted to a Euro-Dollar Loan, on each date such
Base Rate Loan is so converted. Any overdue interest on any Base Rate Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the rate otherwise applicable to Base Rate Loans for
such day.
(b) Each Loan (or portion thereof) when it is a Euro-Dollar Loan shall bear
interest on the outstanding principal amount thereof, for each day during the
Interest Period applicable thereto, at a rate per annum equal to the sum of .55%
plus the London Interbank Offered Rate applicable to such Interest Period. Such
interest shall be payable for each Interest Period on the last day thereof.
The "LONDON INTERBANK OFFERED RATE" applicable to any Interest Period
means the rate per annum determined by the Administrative Agent to be the
arithmetic mean (rounded to the nearest 1/100th of 1%) of the offered rates for
deposits in dollars with a term comparable to such Interest Period that appear
on the Telerate British Bankers Assoc. Interest Settlement Rates Page (as
defined below) at approximately 11:00 A.M., London time, on the second
Euro-Dollar Business Day preceding the first day of such Interest Period;
provided, however, that if there shall at any time no longer exist a Telerate
British Bankers Assoc. Interest Settlement Rates Page, the "LONDON INTERBANK
OFFERED RATE" applicable to any Interest Period means the rate per annum equal
to the rate at which ▇▇▇▇▇▇ Guaranty Trust Company of New York is offered dollar
deposits at or about 10:00 A.M., New York City time, two Euro-Dollar Business
Days prior to the beginning of such Interest Period in the interbank eurodollar
market where the eurodollar and foreign currency and exchange operations in
respect of its Euro-Dollar Loans are then being conducted for delivery on the
first day of such Interest Period for the number of days comprised therein and
in an amount
16
comparable to the amount of its Euro-Dollar Loan to be outstanding during such
Interest Period.
"TELERATE BRITISH BANKERS ASSOC. INTEREST SETTLEMENT RATES PAGE" shall
mean the display designated as Page 3750 on the Telerate System Incorporated
Service (or such other page as may replace such page on such service for the
purpose of displaying the rates at which Dollar deposits are offered by leading
banks in the London interbank deposit market).
(c) Any overdue principal of or interest on any Euro-Dollar Loan shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the higher of (i) the sum of 2.55% plus the London Interbank Offered Rate
applicable to the Interest Period for such Loan and (ii) the sum of 2.55% plus
the rate per annum at which one day (or, if such amount due remains unpaid more
than three Euro-Dollar Business Days, then for such other period of time not
longer than three months as the Administrative Agent may select) deposits in
dollars in an amount approximately equal to the overdue payment due to ▇▇▇▇▇▇
Guaranty Trust Company of New York are offered to ▇▇▇▇▇▇ Guaranty Trust Company
of New York in the London interbank market for the applicable period determined
as provided above (or, if the circumstances described in clause (a) or (b) of
Section 8.01 shall exist, at a rate per annum equal to the sum of 2% plus the
rate applicable to Base Rate Loans for such day).
(d) The Administrative Agent shall determine each interest rate applicable
to the Loans hereunder. The Administrative Agent shall give prompt notice to the
Borrower and the participating Banks of each rate of interest so determined, and
its determination thereof shall be conclusive in the absence of manifest error.
SECTION 2.07. Method of Electing Interest Rates. (a) The Loans shall bear
interest initially at the Euro-Dollar Rate for the Interest Period specified by
the Borrower in the Notice of Borrowing. Thereafter, the Borrower may from time
to time elect to continue each Group of Euro-Dollar Loans (subject in each case
to the provisions of Article 8) as of the last day of the then current Interest
Period applicable to such Loans for an additional Interest Period. Each such
election shall be made by delivering a notice (a "NOTICE OF INTEREST RATE
ELECTION") to the Administrative Agent not later than 10:00 A.M. (New York City
time) on the third Euro-Dollar Business Day before the last day of the then
current Interest Period applicable to such Loan. A Notice of Interest Rate
Election may, if it so specifies, apply to only a portion of the aggregate
principal amount of the relevant Group of Loans; provided that (i) such portion
is allocated ratably among the Loans comprising such Group and (ii) the portion
to which such Notice
17
applies, and the remaining portion to which it does not apply, are each
$20,000,000 or any larger multiple of $1,000,000.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which such notice
applies;
(ii) the date on which the continuation selected in such notice is to be
effective, which shall be the last day of the then current Interest Period
applicable to such Loans; and
(iii) the duration of such additional Interest Period; provided that, if at
the time such notice is delivered an Event of Default has occurred and is
continuing, the duration of the Interest Period with respect to any Euro-
Dollar Loans to which such notice applies shall be one month.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the Borrower
pursuant to subsection (a) above, the Administrative Agent shall promptly notify
each Bank of the contents thereof and such notice shall not thereafter be
revocable by the Borrower. If the Borrower fails to deliver a timely Notice of
Interest Rate Election to the Administrative Agent for any Group of Euro-Dollar
Loans, such Loans shall be continued for an additional Interest Period of one
month (subject to the provisions of Article 8).
(d) If all Euro-Dollar Loans of a Group are converted into Base Rate Loans
pursuant to Section 8.01, the provisions of Section 2.07 shall be applicable,
mutatis mutandis, for the conversion of such Base Rate Loans back into
Euro-Dollar Loans upon the Administrative Agent's notification that the
circumstances giving rise to the suspension under Section 8.01 no longer exist.
(e) An election by the Borrower to change or continue the rate of interest
applicable to any Group of Loans pursuant to this Section shall not constitute a
"BORROWING" subject to the provisions of Section 3.02.
SECTION 2.08. Mandatory Termination of Commitments. The
Commitments shall terminate on the earlier of (i) the close of business on the
Borrowing Date and (ii) the Commitment Termination Date.
18
SECTION 2.09. Optional Prepayments. (a) Subject in the case of any
Euro-Dollar Loans to Section 2.11, the Borrower may, upon at least one Domestic
Business Day's notice to the Administrative Agent, prepay any Base Rate Loan or
upon at least three Euro-Dollar Business Days' notice to the Administrative
Agent, prepay any Euro-Dollar Loan, in each case in whole at any time, or from
time to time in part in amounts aggregating $20,000,000 or any larger multiple
of $1,000,000, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Loans of the several Banks.
(b) Upon receipt of a notice of prepayment pursuant to this Section, the
Administrative Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.10. General Provisions as to Payments. (a) The Borrower shall
make each payment of principal of, and interest on, the Loans, not later than
12:00 Noon (New York City time) on the date when due, in Federal or other funds
immediately available in New York City, to the Administrative Agent at its
address referred to in Section 9.01 . The Administrative Agent will promptly
distribute to each Bank its ratable share of each such payment received by the
Administrative Agent for the account of the Banks. Whenever any payment of
principal of, or interest on, the Base Rate Loans shall be due on a day which is
not a Domestic Business Day, the date for payment thereof shall be extended to
the next succeeding Domestic Business Day. Whenever any payment of principal of,
or interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Banks hereunder
that the Borrower will not make such payment in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the extent that the Borrower
shall not have so made such payment, each Bank shall repay to the Administrative
Agent forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is
19
distributed to such Bank until the date such Bank repays such amount to the
Administrative Agent, at the Federal Funds Rate.
SECTION 2.11. Funding Losses. If the Borrower makes any payment of
principal with respect to any Euro-Dollar Loan or any Euro-Dollar Loan is
converted (pursuant to Article 2, 6 or 8 or otherwise) or continued on any day
other than the last day of an Interest Period applicable thereto, or the last
day of an applicable period fixed pursuant to Section 2.06(c) , or if the
Borrower fails to borrow, prepay or continue any Euro-Dollar Loan after notice
has been given to any Bank in accordance with Section 2.03(a), 2.09(a) or
2.07(a), respectively, the Borrower shall reimburse each Bank within 15 days
after demand for any resulting loss or expense incurred by it (or by an existing
or prospective Participant in the related Loan), including (without limitation)
any loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after any such prepayment
or conversion or continuation or failure to borrow, prepay, or continue;
provided that such Bank shall have delivered to the Borrower a certificate as to
the amount of such loss or expense and setting forth the calculation thereof in
reasonable detail, which certificate shall be conclusive in the absence of
manifest error.
SECTION 2.12. Computation of Interest and Fees. Interest based on the
Prime Rate hereunder shall be computed on the basis of a year of 365 days (or
366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest shall
be computed on the basis of a year of 360 days and paid for the actual number of
days elapsed (including the first day but excluding the last day).
SECTION 2.13. Regulation D Compensation. Each Bank may require the
Borrower to pay, contemporaneously with each payment of interest on the
Euro-Dollar Loans, additional interest on the related Euro-Dollar Loan of such
Bank at a rate per annum determined by such Bank up to but not exceeding the
excess of (i) (A) the applicable London Interbank Offered Rate divided by (B)
one minus the Euro-Dollar Reserve Percentage over (ii) the applicable London
Interbank Offered Rate. Any Bank wishing to require payment of such additional
interest (x) shall so notify the Borrower and the Administrative Agent, in which
case such additional interest on the Euro-Dollar Loans of such Bank shall be
payable to such Bank at the place indicated in such notice with respect to each
Interest Period commencing at least three Euro-Dollar Business Days after the
giving of such notice and (y) shall notify the Borrower at least five
Euro-Dollar Business Days prior to each date on which interest is payable on the
Euro-Dollar Loans of the amount then due it under this Section.
20
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing. The closing hereunder shall occur upon receipt
by the Co-Documentation Agents of the following documents, each dated the
Closing Date unless otherwise indicated:
(a) a duly executed Note for the account of each Bank dated on or before
the Closing Date complying with the provisions of Section 2.04;
(b) an opinion of Weil, Gotshal & ▇▇▇▇▇▇ LLP, counsel for the Obligors,
substantially in the form of Exhibit B hereto and covering such additional
matters relating to the transactions contemplated hereby as the Required
Banks may reasonably request;
(c) an opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Agents,
substantially in the form of Exhibit C hereto and covering such additional
matters relating to the transactions contemplated hereby as the Required
Banks may reasonably request; and
(d) all documents the Co-Documentation Agents may reasonably request
relating to the existence of each Obligor, the corporate authority for and
the validity of this Agreement and the Notes, and any other matters
relevant hereto, all in form and substance satisfactory to the Co-
Documentation Agents.
The Co-Documentation Agents shall promptly notify each Obligor and the Banks of
the Closing Date, and such notice shall be conclusive and binding on all parties
hereto.
SECTION 3.02. Borrowing. The obligation of any Bank to make its Loan
on the occasion of the Borrowing is subject to the satisfaction of the following
conditions:
(a) the fact that the Closing Date shall have occurred on or prior to
February 2, 1998;
(b) receipt by the Administrative Agent of the Notice of Borrowing as
required by Section 2.02;
(c) the fact that, immediately before and after the Borrowing, no Default
shall have occurred and be continuing;
21
(d) the fact that the representations and warranties of the Obligors
contained in this Agreement shall be true on and as of the Borrowing Date;
and
(e) receipt by the Co-Documentation Agents of evidence
satisfactory to such Agents that the principal of and accrued interest on
all loans outstanding under the Existing Credit Agreement on the Borrowing
Date have been (or, after application of the proceeds of the Borrowing,
will have been) paid in full.
The Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the Borrowing Date as to the facts specified in clauses (c) and
(d) of this Section.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Each Obligor jointly and severally represents and warrants that:
SECTION 4.01. Corporate Existence and Power. Each Obligor is a corporation
duly incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted, except to the extent that the failure to have
such licenses, authorizations, consents and approvals could not reasonably be
expected to have a Material Adverse Effect.
SECTION 4.02. Corporate and Governmental Authorization; No Contravention.
The execution, delivery and performance by each Obligor of this Agreement and by
the Borrower of the Notes are within the corporate powers of such Obligor and
the Borrower, respectively, have been duly authorized by all necessary corporate
action, require no action by or in respect of, or filing with, any governmental
body, agency or official and do not contravene, or constitute a default under,
any provision of applicable law or regulation or of the certificate of
incorporation or by-laws of either Obligor or of any agreement evidencing or
governing Debt or of any other material agreement, or of any judgment,
injunction, order, decree or other material instrument binding upon the Borrower
or any of its Subsidiaries or result in the creation or imposition of any Lien
on any asset of the Borrower or any of its Subsidiaries.
22
SECTION 4.03. Binding Effect. This Agreement constitutes a valid and
binding agreement of each Obligor and each Note, when executed and delivered by
the Borrower in accordance with this Agreement, will constitute a valid and
binding obligation of the Borrower, in each case enforceable in accordance with
its terms, except as the same may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by general principles of
equity.
SECTION 4.04. Financial Information. (a) The consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries as of June 30, 1997 and the
related consolidated statements of earnings and cash flows for the fiscal year
then ended, reported on by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ L.L.P., copies of which have been
delivered to each of the Banks, fairly present, in conformity with generally
accepted accounting principles, the consolidated financial position of the
Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such fiscal year.
(b) The unaudited consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of December 31, 1997 and the related unaudited
consolidated statements of earnings and cash flows for the six months then
ended, copies of which have been delivered to each of the Banks, fairly present,
in conformity with generally accepted accounting principles applied on a basis
consistent with the financial statements referred to in subsection (a) of this
Section, the consolidated financial position of the Borrower and its
Consolidated Subsidiaries as of such date and their consolidated results of
operations and cash flows for such six-month period (subject to normal year-end
adjustments).
(c) On the Closing Date, there has been no material adverse change in the
business, financial position or results of operations of the Borrower and its
Consolidated Subsidiaries, considered as a whole, since December 31, 1997.
SECTION 4.05. Litigation. There is no action, suit or proceeding pending
against, or to the knowledge of either Obligor, overtly threatened against or
affecting, the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision which could have a Material
Adverse Effect, or which in any manner draws into question the validity or
enforceability of this Agreement or the Notes.
SECTION 4.06. Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of
23
the ERISA Group has (i) sought a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code in respect of any Plan, (ii) failed to
make any contribution or payment to any Plan or Multiemployer Plan or in respect
of any Benefit Arrangement, or made any amendment to any Plan or Benefit
Arrangement, which has resulted or could result in the imposition of a Lien or
the posting of a bond or other security under ERISA or the Internal Revenue Code
or (iii) incurred any liability under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA.
SECTION 4.07. Environmental Matters. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of Environmental
Laws on the business, operations and properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including, without limitation, any capital or operating
expenditures required for clean-up or closure of properties presently or
previously owned, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or as
a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat, any costs or liabilities in connection with off-site disposal
of wastes or Hazardous Substances, and any actual or potential liabilities to
third parties, including employees, and any related costs and expenses). On the
basis of this review, the Borrower has reasonably concluded that such associated
liabilities and costs, including the costs of compliance with Environmental
Laws, are unlikely to have a Material Adverse Effect.
SECTION 4.08. Taxes. The Borrower and its Subsidiaries have filed all
United States Federal income tax returns and all other material tax returns
which are required to be filed by them and have paid all taxes due pursuant to
such returns or pursuant to any assessment received by the Borrower or any
Subsidiary, other than taxes due pursuant to any such assessment which are being
contested in good faith by appropriate proceedings. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of taxes
or other governmental charges are, in the opinion of the Borrower, adequate.
SECTION 4.09. Subsidiaries. (a) Each of the Borrower's corporate
Significant Subsidiaries (other than the Guarantor, with respect to which
representations and warranties comparable to those set forth in this Section are
being made in Section 4.01) is a corporation duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation, and
has all corporate powers and all governmental licenses, authorizations, consents
and approvals required to carry on its business as now conducted, except to the
extent
24
that the failure to be or have any of the foregoing could not reasonably be
expected to have a Material Adverse Effect.
(b) The Borrower owns, directly or indirectly, 100% of the outstanding
capital stock of the Guarantor.
SECTION 4.10. Regulatory Restrictions on Borrowing. Neither Obligor is an
"INVESTMENT COMPANY" within the meaning of the Investment Company Act of 1940,
as amended, or otherwise subject to any regulatory scheme which restricts its
ability to incur debt.
SECTION 4.11. Full Disclosure. All information heretofore furnished by
either Obligor to either Agent or any Bank for purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished by either Obligor to the Administrative Agent or
any Bank will be, true and accurate in all material respects on the date as of
which such information is stated or certified.
ARTICLE 5
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment hereunder
or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to each of the
Banks:
(a) as soon as available and in any event within 90 days after the end of
each fiscal year of the Borrower, a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as of the end of such fiscal
year and the related consolidated statements of earnings and cash flows
for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
L.L.P. or other independent public accountants of nationally recognized
standing without any qualification or exception which (i) is of a "GOING
CONCERN" or similar nature, (ii) relates to the limited scope of
examination of matters relevant to such financial statements or (iii)
relates to the treatment or classification of any item in such financial
statements and which, as a condition to its removal, would require an
adjustment to such item the
25
effect of which would be to cause an Event of Default under Sections
5.09(k), 5.10, 5.11 or 5.12;
(b) as soon as available and in any event within 45 days after the end of
each of the first three quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such quarter and the related consolidated
statements of earnings and cash flows for such quarter and for the portion
of the Borrower's fiscal year ended at the end of such quarter, setting
forth in the case of such statements of earnings and cash flows, in
comparative form the figures for the corresponding quarter and the
corresponding portion of the Borrower's previous fiscal year, all
certified (subject to normal year-end adjustments) as to fairness of
presentation, generally accepted accounting principles and consistency by
the chief financial officer or the chief accounting officer of the
Borrower;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate of the chief
financial officer, the chief accounting officer or the treasurer of the
Borrower (i) setting forth in reasonable detail the calculations required
to establish whether the Borrower was in compliance with the requirements
of Sections 5.09 through 5.12 inclusive, on the date of such financial
statements and (ii) stating whether any Default exists on the date of such
certificate and, if any Default then exists, setting forth the details
thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above, a statement of the firm of independent
public accountants which reported on such statements (i) whether anything
has come to their attention to cause them to believe that any Default
existed on the date of such statements and (ii) confirming the
calculations set forth in the officer's certificate delivered
simultaneously therewith pursuant to clause (c) above;
(e) within ten days after any Senior Officer of either Obligor obtains
knowledge of any Default, if such Default is then continuing, a
certificate of the chief financial officer, the chief accounting officer
or the treasurer of the Borrower setting forth the details thereof and the
action which each Obligor is taking or proposes to take with respect
thereto;
26
(f) within ten days after the mailing thereof to the stockholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) within ten days after the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q
and 8-K (or their equivalents) which the Borrower shall have filed with
the Securities and Exchange Commission;
(h) if and when any member of the ERISA Group (i) gives or is required to
give notice to the PBGC of any "REPORTABLE EVENT" (as defined in Section
4043 of ERISA) with respect to any Plan which might constitute grounds for
a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any
such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or
partial withdrawal liability under Title IV of ERISA or notice that any
Multiemployer Plan is in reorganization, is insolvent or has been
terminated, a copy of such notice; (iii) receives notice from the PBGC
under Title IV of ERISA of an intent to terminate, impose liability (other
than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a
waiver of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent to
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice
and other information filed with the PBGC; (vi) gives notice of withdrawal
from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could
result in the imposition of a Lien or the posting of a bond or other
security, a certificate of the chief financial officer, the chief
accounting officer or the treasurer of the Borrower setting forth details
as to such occurrence and action, if any, which the Borrower or applicable
member of the ERISA Group is required or proposes to take; and
(i) from time to time such additional information regarding the financial
position or business of the Borrower and its Subsidiaries as the
Administrative Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Payment of Obligations. The Borrower will pay and discharge,
and will cause each Significant Subsidiary to pay and discharge, at or
27
before maturity, all their respective material obligations and liabilities
(including, without limitation, tax liabilities and claims of materialmen,
warehousemen and the like which if unpaid might by law give rise to a Lien),
except where the same may be contested in good faith by appropriate proceedings
or to the extent that failure to do so could not reasonably be expected to have
a Material Adverse Effect, and will maintain, and will cause each Significant
Subsidiary to maintain, in accordance with generally accepted accounting
principles, appropriate reserves for the accrual of any of the same.
SECTION 5.03. Insurance. The Borrower will, and will cause each of its
Significant Subsidiaries to, maintain (either in the name of the Borrower or in
such Significant Subsidiary's own name), with financially sound and responsible
insurance companies or pursuant to a self-insurance program, insurance on all
their respective properties in at least such amounts, against at least such
risks and with such risk retention as are usually maintained, insured against or
retained, as the case may be, in the same general area by companies of
established repute engaged in the same or a similar business; and will furnish
to the Banks, upon request from the Administrative Agent, information presented
in reasonable detail as to the insurance so carried.
SECTION 5.04. Conduct of Business and Maintenance of Existence. The
Borrower will preserve, renew and keep in full force and effect, and will cause
the Guarantor and each other Significant Subsidiary to preserve, renew and keep
in full force and effect its corporate existence and rights, privileges and
franchises necessary or desirable in the normal conduct of business (except,
solely with respect to any Significant Subsidiary other than the Guarantor, to
the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect); provided that nothing in this Section shall prohibit
(i) the merger of a Significant Subsidiary into the Borrower or the merger or
consolidation of a Significant Subsidiary with or into another Person if the
corporation surviving such consolidation or merger is a Subsidiary (provided
that in the case of any such merger or consolidation involving the Guarantor, it
or the Borrower must be the surviving corporation) and if, in each case, after
giving effect thereto, no Default shall have occurred and be continuing or (ii)
the termination of the corporate existence of any Significant Subsidiary (other
than the Guarantor) if the Borrower in good faith determines that such
termination is in the best interest of the Borrower and is not materially
disadvantageous to the Banks.
SECTION 5.05. Compliance with Laws. The Borrower will comply, and cause
the Guarantor and each other Significant Subsidiary to comply, in all material
respects with all applicable laws, ordinances, rules, regulations, and
requirements of governmental authorities (including, without limitation,
Environmental Laws and ERISA and the rules and regulations thereunder) except
28
where the necessity of compliance therewith is contested in good faith by
appropriate proceedings or to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.
SECTION 5.06. Inspection of Property, Books and Records. The Borrower will
keep, and will cause the Guarantor and each other Significant Subsidiary to
keep, proper books of record and account in which full, true and correct entries
shall be made in all material respects of all dealings and transactions in
relation to its business and activities; and will permit, and will cause the
Guarantor and each other Subsidiary to permit, representatives of any Bank at
such Bank's expense to visit and inspect any of its properties, to examine and
make abstracts from any of its books and records and to discuss its affairs,
finances and accounts with its officers, employees and independent public
accountants, all at such reasonable times and as often as may reasonably be
desired.
SECTION 5.07. Mergers and Sales of Assets. The Borrower will not, and will
not permit the Guarantor to, (i) consolidate or merge with or into any other
Person or (ii) sell, lease or otherwise transfer, directly or indirectly, all or
substantially all of the assets of the Borrower and its Subsidiaries, taken as a
whole, to any other Person; provided that (a) the Borrower may merge with
another Person if (x) the Borrower is the corporation surviving such merger and
(y) after giving effect to such merger, no Default shall have occurred and be
continuing and (b) the Guarantor may be a party to any merger or consolidation
permitted by Section 5.04.
SECTION 5.08. Use of Proceeds. The proceeds of the Loans made under this
Agreement will be used by the Borrower for general corporate purposes, including
(subject to the next sentence) acquisitions and repayment of amounts outstanding
under the Existing Credit Agreement. None of such proceeds will be used,
directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of buying or carrying any "MARGIN STOCK" within the meaning of
Regulation U.
SECTION 5.09. Negative Pledge. Neither the Borrower nor any Subsidiary
will create, assume or suffer to exist any Lien on any asset now owned or
hereafter acquired by it, except:
(a) Liens existing as of July 1, 1996 securing Debt outstanding as of July
1, 1996 in an aggregate principal or face amount not exceeding
$30,000,000;
29
(b) any Lien existing on any asset of any Person at the time such Person
becomes a Subsidiary and not created in contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed for the purpose
of financing all or any part of the cost of acquiring or constructing such
asset, provided that such Lien attaches to such asset concurrently with or
within 90 days after the acquisition or substantial completion of
construction thereof, as the case may be;
(d) any Lien on any asset of any Person existing at the time such Person is
merged or consolidated with or into the Borrower or a Subsidiary and not
created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition thereof by the
Borrower or a Subsidiary and not created in contemplation of such
acquisition;
(f) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the
foregoing clauses of this Section, provided that such Debt is not
increased and is not secured by any additional assets;
(g) Liens imposed by any governmental authority for taxes, assessments,
governmental charges, duties or levies not yet due or which are being
contested in good faith and by appropriate proceedings; provided adequate
reserves with respect thereto are maintained on the books of the Borrower
and its Consolidated Subsidiaries in accordance with generally accepted
accounting principles;
(h) carriers', warehousemen's, mechanics', transporters, materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business; provided any such Lien is either (x) discharged within five days
of the date when payment of the obligation secured by such Lien is due or
(y) is being contested in good faith by appropriate proceedings diligently
conducted;
(i) Liens (other than Liens described in clauses (g) or (h)) arising in the
ordinary course of its business which (i) do not secure Debt or
Derivatives Obligations, (ii) do not secure any obligation in an amount
exceeding $20,000,000 and (iii) do not in the aggregate materially detract
from the value of its assets or materially impair the use thereof in the
operation of its business;
30
(j) Liens on cash and cash equivalents securing Derivatives Obligations,
provided that the aggregate amount of cash and cash equivalents subject to
such Liens may at no time exceed $20,000,000; and
(k) Liens not otherwise permitted by the foregoing clauses of this Section
securing Debt in an aggregate principal or face amount at any date not to
exceed the greater of (i) $100,000,000 and (ii) 15% of Consolidated
Tangible Net Worth at the last day of the most recently ended fiscal
quarter.
SECTION 5.10. Debt to Total Capital. The Debt to Capital Ratio at the last
day of each fiscal quarter shall be less than .60:1.
SECTION 5.11. Interest Coverage Ratio. As of the last day of each fiscal
quarter of the Borrower, the ratio of (i) Consolidated EBITDA for the four
consecutive fiscal quarters of the Borrower and its Consolidated Subsidiaries
ending on such date to (ii) Consolidated Interest Expense for such period will
not be less than 3.0 to 1.
SECTION 5.12. Debt of Subsidiaries. The Borrower will not permit any of
its Subsidiaries (other than the Guarantor) to incur or at any time be liable
with respect to any Debt other than (i) Debt owing to the Borrower or a wholly
owned Subsidiary and (ii) other Debt in an aggregate principal amount
outstanding not exceeding $250,000,000. For purposes of this Section any
preferred stock of a Subsidiary held by a Person other than the Borrower or a
wholly-owned Subsidiary shall be included, at the higher of its voluntary or
involuntary liquidation value, in the "DEBT" of such Subsidiary.
SECTION 5.13. Transactions with Affiliates. The Borrower will not, and
will not permit any Subsidiary to, directly or indirectly, pay any funds to or
for the account of, make any investment (whether by acquisition of stock or
indebtedness, by loan, advance, transfer of property, guarantee or other
agreement to pay, purchase or service, directly or indirectly, any Debt, or
otherwise) in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, to, or participate in, or effect, any transaction with,
any Affiliate (any such payment, investment, lease, sale, transfer, other
disposition or transaction, an "AFFILIATE TRANSACTION") except on an arms-length
basis on terms at least as favorable to the Borrower or such Subsidiary as terms
that could have been obtained from a third party who was not an Affiliate;
provided that the foregoing provisions of this Section shall not prohibit (i)
any such Person from declaring or paying any lawful dividend or other payment
ratably in respect of all of its capital stock of the relevant class so long as,
after giving effect thereto, no Default shall have
31
occurred and be continuing, (ii) any Affiliate Transaction disclosed in the
Prospectus or (iii) any Affiliate Transaction (other than any Affiliate
Transaction described in clauses (i) or (ii)) in which the amount involved does
not exceed $60,000. The approval by the independent directors of the board of
directors of the Borrower or a Subsidiary of any Affiliate Transaction to which
the Borrower or such Subsidiary is a party shall create a rebuttable presumption
that such Affiliate Transaction is on an arms-length basis on terms at least as
favorable to the Borrower or such Subsidiary as terms that could have been
obtained from a third party who was not an Affiliate.
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following events
("EVENTS OF DEFAULT") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any Loan or
shall fail to pay any interest or fees payable hereunder within five
Domestic Business Days of the due date thereof;
(b) the Borrower shall fail to observe or perform any covenant contained in
Article 5, other than those contained in Sections 5.01 through 5.06 and
5.13;
(c) either Obligor shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those covered by clause
(a) or (b) above) for 30 days after notice thereof has been given to the
Borrower by the Administrative Agent at the request of any Bank;
(d) any representation, warranty, certification or statement made by either
Obligor in this Agreement or in any certificate, financial statement or
other document delivered pursuant to this Agreement shall prove to have
been incorrect in any material respect when made (or deemed made);
(e) the Borrower or any Subsidiary shall fail to make any payment in
respect of any Material Financial Obligations when due or within any
applicable grace period;
32
(f) any event or condition shall occur which results in the acceleration of
the maturity of any Material Debt or enables the holder of such Debt or
any Person acting on such holder's behalf to accelerate the maturity
thereof;
(g) the Borrower or any Significant Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent
to any such relief or to the appointment of or taking possession by any
such official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced against the
Borrower or any Significant Subsidiary seeking liquidation, reorganization
or other relief with respect to it or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 90 days; or an order for relief shall be entered against
the Borrower or any Significant Subsidiary under the federal bankruptcy
laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $20,000,000 which it shall have become
liable to pay under Title IV of ERISA; or notice of intent to terminate a
Material Plan shall be filed under Title IV of ERISA by any member of the
ERISA Group, any plan administrator or any combination of the foregoing;
or the PBGC shall institute proceedings under Title IV of ERISA to
terminate, to impose liability (other than for premiums under Section 4007
of ERISA) in respect of, or to cause a trustee to be appointed to
administer any Material Plan; or a condition shall exist by reason of
which the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated; or there shall occur a complete or
partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans
which could cause one or more members of the ERISA Group to incur a
current payment obligation in excess of $20,000,000;
33
(j) judgments or orders for the payment of money in excess of $20,000,000
(net of any insurance with respect to which the carrier has acknowledged
coverage) shall be rendered against the Borrower or any Subsidiary and
such judgments or orders shall continue unsatisfied and unstayed for a
period of 30 days;
(k) at any time on or after the Trigger Date, Lauder Family Members shall
cease at any time to hold (either of record or beneficially through a
nominee), in the aggregate, Shares constituting in excess of 50% of the
voting power represented by the aggregate number of Shares outstanding at
such time;
(l) the Borrower shall cease at any time to own, directly or indirectly,
100% of the outstanding capital stock of the Guarantor; or
(m) the Guaranty or any provision thereof shall be found or held invalid or
unenforceable by a court of competent jurisdiction or the Guarantor shall
have repudiated its obligations under the Guaranty;
then, following the occurrence and during the continuance of every such event,
the Administrative Agent shall (i) if requested by Banks having more than 50% in
aggregate amount of the Commitments, by notice to the Borrower terminate the
Commitments and they shall thereupon terminate, and (ii) if requested by Banks
holding more than 50% of the aggregate principal amount of the Loans, by notice
to the Borrower declare the Loans (together with accrued interest thereon) to
be, and the Loans shall thereupon become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Obligor; provided that in the case of any of the Events of
Default specified in clause 6.01(g) or 6.01(h) above with respect to the
Borrower, without any notice to the either Obligor or any other act by the
Administrative Agent or the Banks, the Commitments shall thereupon terminate and
the Loans (together with accrued interest thereon) shall become immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by each Obligor.
SECTION 6.02. Notice of Default. The Administrative Agent shall give
notice to the Borrower under Section 6.01(c) promptly upon being requested to do
so by any Bank and shall thereupon notify all the Banks thereof.
34
ARTICLE 7
THE AGENTS
SECTION 7.01. Appointment and Authorizations. Each Bank irrevocably
appoints and authorizes each Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement and the Notes as are delegated
to such Agent by the terms hereof or thereof, together with all such powers as
are reasonably incidental thereto.
SECTION 7.02. Agents and Affiliates. ▇▇▇▇▇▇ Guaranty Trust Company of New
York, The Chase Manhattan Bank and Citibank, N.A. shall have the same rights and
powers under this Agreement as any other Bank and may exercise or refrain from
exercising the same as though it were not an Agent, and each of ▇▇▇▇▇▇ Guaranty
Trust Company of New York, The Chase Manhattan Bank and Citibank, N.A. and their
respective affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrower or any Subsidiary or affiliate
of the Borrower as if it were not an Agent.
SECTION 7.03. Action by Agents. The obligations of the Agents hereunder
are only those expressly set forth herein. Without limiting the generality of
the foregoing, no Agent shall be required to take any action with respect to any
Default, except as expressly provided in Article 6.
SECTION 7.04. Consultation with Experts. Each of the Agents may consult
with legal counsel (who may be counsel for either Obligor), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agents. No Agent nor any of its affiliates nor
any of their respective directors, officers, agents or employees shall be liable
for any action taken or not taken by it in connection herewith (i) with the
consent or at the request of the Required Banks or (ii) in the absence of its
own gross negligence or willful misconduct. No Agent nor any of its affiliates
nor any of their respective directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement or
any borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of either Obligor; (iii) the satisfaction of any
condition specified in Article 3, except receipt of items required to be
delivered to the Co- Documentation Agents; or (iv) the validity, effectiveness
or genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection
35
herewith. No Agent shall not incur any liability by acting in reliance upon any
notice, consent, certificate, statement, or other writing (which may be a bank
wire, telex, facsimile transmission or similar writing) believed by it to be
genuine or to be signed by the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in accordance with
its Commitment, indemnify each Agent, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by
either Obligor) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any action
taken or omitted by such indemnitees hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon any Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon any of the
Agents, or any other Bank, 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 any action under this Agreement.
SECTION 7.08. Successor Agents. Any Agent may resign at any time by giving
notice thereof to the Banks and each Obligor. Upon any such resignation, the
Required Banks shall have the right (after consulting with the Borrower) to
appoint a successor to such Agent. If no successor to such Agent shall have been
so appointed by the Required Banks, and shall have accepted such appointment,
within 30 days after the retiring Agent gives notice of resignation, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be a commercial bank organized or licensed under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $500,000,000. Upon the acceptance of its appointment as an
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was an Agent.
36
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair.
If on or prior to the first day of any Interest Period for any Euro-Dollar Loan:
(a) there no longer exists a Telerate British Bankers Assoc. Interest
Settlement Rates Page and the Administrative Agent is advised by ▇▇▇▇▇▇
Guaranty Trust Company of New York that deposits in dollars (in the
applicable amounts) are not being offered to it in the London interbank
market for such Interest Period, or
(b) Banks holding 50% or more of the aggregate principal amount of the
Loans advise the Administrative Agent that the London Interbank Offered
Rate, as determined by the Administrative Agent, will not adequately and
fairly reflect the cost to such Banks of funding their Euro-Dollar Loans
for such Interest Period,
the Administrative Agent shall forthwith give notice thereof to the Borrower and
the Banks, whereupon until the Administrative Agent notifies the Borrower that
the circumstances giving rise to such suspension no longer exist (at which point
the provisions of Section 2.07(d) shall be applicable), (i) the obligations of
the Banks to continue outstanding Loans as Euro-Dollar Loans shall be suspended
and (ii) each outstanding Euro-Dollar Loan shall be converted into a Base Rate
Loan on the last day of the then current Interest Period applicable thereto.
SECTION 8.02. Illegality. If, on or after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Euro-Dollar Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall make it unlawful or impossible for any Bank (or its
Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar Loans and
such Bank shall so notify the Administrative Agent, the Administrative Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Administrative Agent
that the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to continue outstanding Loans as Euro-Dollar Loans,
shall be suspended. Before giving any notice to the Administrative Agent
pursuant to this Section, such Bank shall designate a different Euro-Dollar
Lending Office if such designation will
37
avoid the need for giving such notice and will not, in the sole judgment of such
Bank, be otherwise disadvantageous to such Bank. If such notice is given, each
Euro-Dollar Loan of such Bank then outstanding shall be converted to a Base Rate
Loan either (a) on the last day of the then current Interest Period applicable
to such Euro-Dollar Loan if such Bank may lawfully continue to maintain and fund
such Loan to such day or (b) immediately if such Bank shall determine that it
may not lawfully continue to maintain and fund such Loan to such day.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on or after (x)
the date hereof, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall impose, modify or deem
applicable any reserve (including, without limitation, any such requirement
imposed by the Board of Governors of the Federal Reserve System, but excluding
with respect to any Euro-Dollar Loan any such requirement with respect to which
such Bank is entitled to compensation during the relevant interest period under
Section 2.13), special deposit, insurance assessment or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Bank (or its Applicable Lending Office) or shall impose on any Bank (or its
Applicable Lending Office) or on the London interbank market any other condition
affecting its Euro-Dollar Loans, its Note or its obligation to make Euro-Dollar
Loans and the result of any of the foregoing is to increase the cost to such
Bank (or its Applicable Lending Office) of maintaining any Euro-Dollar Loan, or
to reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Administrative Agent), the
Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any such law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on capital
of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below
38
that which such Bank (or its Parent) could have achieved but for such adoption,
change, request or directive (taking into consideration its policies with
respect to capital adequacy) by an amount deemed by such Bank to be material,
then from time to time, within 15 days after demand by such Bank (with a copy to
the Administrative Agent), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank (or its Parent) for such
reduction.
(c) Each Bank will promptly notify the Borrower and the Administrative
Agent of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Bank to compensation pursuant to this Section and will
designate a different Lending Office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the sole
judgment of such Bank, be otherwise disadvantageous to such Bank. A certificate
of any Bank claiming compensation under this Section and setting forth the
additional amount or amounts to be paid to it hereunder and the calculation
thereof in reasonable detail shall be conclusive in the absence of manifest
error. In determining such amount, such Bank may use any reasonable averaging
and attribution methods.
SECTION 8.04. Taxes. (a) For the purposes of this Section, the following
terms have the following meanings:
"TAXES" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings with respect to any payment by
either Obligor pursuant to this Agreement or under any Note, and all liabilities
with respect thereto, excluding (i) in the case of each Bank and the
Administrative Agent, taxes imposed on its income, and franchise or similar
taxes imposed on it, by a jurisdiction under the laws of which such Bank or the
Administrative Agent (as the case may be) is organized or in which its principal
executive office is located or, in the case of each Bank, in which its
Applicable Lending Office is located and (ii) in the case of each Bank, any
United States withholding tax imposed on such payments but only to the extent
that such Bank is subject to United States withholding tax at the time such Bank
first becomes a party to this Agreement.
"OTHER TAXES" means any present or future stamp or documentary taxes and
any other excise or property taxes, or similar charges or levies, which arise
from any payment made pursuant to this Agreement or under any Note or from the
execution or delivery of, or otherwise with respect to, this Agreement or any
Note.
(b) Any and all payments by either Obligor to or for the account of any
Bank or the Administrative Agent hereunder or under any Note shall be made
39
without deduction for any Taxes or Other Taxes; provided that, if either Obligor
shall be required by law to deduct any Taxes or Other Taxes from any such
payments, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section) such Bank or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) such Obligor shall make such deductions, (iii)
such Obligor shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law and (iv) such
Obligor shall furnish to the Administrative Agent, at its address referred to in
Section 9.01, the original or a certified copy of a receipt evidencing payment
thereof.
(c) Each Obligor agrees to indemnify each Bank and the Administrative Agent
for the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section) paid by such Bank or the Administrative Agent (as the case
may be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be paid within 30
days after such Bank or the Administrative Agent (as the case may be) makes
demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the United
States, on or prior to the date of its execution and delivery of this Agreement
in the case of each Bank listed on the signature pages hereof and on or prior to
the date on which it becomes a Bank in the case of each other Bank, and from
time to time thereafter if requested in writing by the Borrower (but only so
long as such Bank remains lawfully able to do so), shall provide the Borrower
and the Administrative Agent with Internal Revenue Service form 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Bank is entitled to benefits under an income tax treaty to
which the United States is a party which exempts the Bank from United States
withholding tax or reduces the rate of withholding tax on payments of interest
for the account of such Bank or certifying that the income receivable pursuant
to this Agreement is effectively connected with the conduct of a trade or
business in the United States.
(e) For any period with respect to which a Bank has failed to provide the
Borrower or the Administrative Agent with the appropriate form pursuant to
Section 8.04(d) (unless such failure is due to a change in treaty, law or
regulation occurring subsequent to the date on which such form originally was
required to be provided), such Bank shall not be entitled to indemnification
under Section 8.04(b) or (c) with respect to Taxes imposed by the United States;
provided that if a Bank, which is otherwise exempt from or subject to a reduced
rate of
40
withholding tax, becomes subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower shall take such steps as such Bank shall
reasonably request to assist such Bank to recover such Taxes.
(f) If either Obligor is required to pay additional amounts to or for the
account of any Bank pursuant to this Section, then such Bank will change the
jurisdiction of its Applicable Lending Office if, in the sole judgment of such
Bank, such change (i) will eliminate or reduce any such additional payment which
may thereafter accrue and (ii) is not otherwise disadvantageous to such Bank.
SECTION 8.05. Base Rate Loans Substituted for Affected Euro-Dollar Loans.
If (i) the obligation of any Bank to continue outstanding Loans as Euro-Dollar
Loans has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03 or 8.04 with respect to its Euro- Dollar Loans
and the Borrower shall, by at least five Euro-Dollar Business Days' prior notice
to such Bank through the Administrative Agent, have elected that the provisions
of this Section shall apply to such Bank, then, unless and until such Bank
notifies the Borrower that the circumstances giving rise to such suspension or
demand for compensation no longer exist:
(a) all Loans which would otherwise be continued by such Bank as
Euro-Dollar Loans shall instead be converted into Base Rate Loans (on
which interest and principal shall be payable contemporaneously with the
related Euro-Dollar Loans of the other Banks); and
(b) after each of its Euro-Dollar Loans has been repaid (or converted to a
Base Rate Loan), all payments of principal which would otherwise be
applied to repay such Euro-Dollar Loans shall be applied to repay its Base
Rate Loans instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Base Rate Loan shall
be converted into a Euro-Dollar Loan on the first day of the next succeeding
Interest Period applicable to the related Euro-Dollar Loans of the other Banks.
SECTION 8.06. Substitution of Banks. If (i) the obligation of any Bank to
continue outstanding Loans as Euro-Dollar Loans has been suspended pursuant to
Section 8.02 or (ii) any Bank has demanded compensation under Section 8.03 or
8.04, the Borrower shall have the right, with the assistance of the Agent, to
seek a substitute bank or banks (which may be one or more of the Banks),
satisfactory to the Borrower and the Agent, to purchase the Note of such Bank,
for a purchase price equal to the outstanding principal amount of the Loans
evidenced by such Note (together with any accrued and unpaid interest thereon
and breakage costs, if
41
any) or such other purchase price as such Bank and substitute bank or banks
shall agree upon.
ARTICLE 9
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of either Obligor or the Administrative Agent, at its address or facsimile
number set forth on the signature pages hereof, (b) in the case of any Bank, at
its address or facsimile number set forth in its Administrative Questionnaire or
(c) in the case of any party, such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the Administrative
Agent, the Guarantor and the Borrower. Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when
transmitted to the facsimile number specified in this Section and confirmation
of receipt is received, (ii) if given by mail, 72 hours after such communication
is deposited in the mails with first class postage prepaid, addressed as
aforesaid or (iii) if given by any other means, when delivered at the address
specified in this Section; provided that notices to the Administrative Agent
under Article 2 or Article 8 shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by either Agent or any Bank
in exercising any right, power or privilege hereunder or under any Note 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 herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.03. Expenses; Indemnification. (a) The Borrower shall pay (i)
all reasonable out-of-pocket expenses of the Agents, including reasonable fees
and disbursements of special counsel for the Agents, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agents and each Bank, including (without duplication) the fees and
disbursements of outside counsel and the allocated cost of inside counsel, in
connection with such Event of Default and collection, bankruptcy, insolvency and
other enforcement proceedings resulting therefrom.
42
(b) The Borrower agrees to indemnify each Agent and each Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "INDEMNITEE") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection
with any investigative, administrative or judicial proceeding (whether or not
such Indemnitee shall be designated a party thereto) brought or overtly
threatened relating to or arising out of this Agreement or any actual or
proposed use of proceeds of Loans hereunder; provided that no Indemnitee shall
have the right to be indemnified hereunder for such Indemnitee's own gross
negligence or willful misconduct as determined by a court of competent
jurisdiction. Each Indemnitee agrees to notify the Borrower promptly of any
proceeding in respect of which it will seek indemnification hereunder; provided
however that the failure of any Indemnitee so to notify the Borrower shall not
affect the rights of such Indemnitee hereunder; but provided further that the
Borrower shall be entitled to assert by separate action against such Indemnitee
any claim for actual damages incurred by the Borrower as a consequence of such
failure by such Indemnitee to give such notice. In the event any action, suit or
proceeding is brought against any Indemnitee by any Person other than a Bank or
the Agent or any of their respective affiliates (a "THIRD PARTY ACTION"), (i)
the Borrower shall be entitled, upon written notice to such Indemnitee, to
assume the investigation and defense thereof with counsel reasonably
satisfactory to such Indemnitee unless (x) the employment by such Indemnitee of
separate counsel has been specifically approved by the Borrower in writing or
(y) the designated parties to the proceeding in which such claim, demand, action
or cause of action has been asserted include (or are reasonably likely to
include) both such Indemnitee and any of the Borrower, the Guarantor, or any
Affiliate (each, a "DESIGNATED RELATED PARTY") and in the opinion of counsel for
such Indemnitee there exist one or more defenses that may be available to such
Indemnitee which are in conflict with those available to any designated related
party, (ii) such Indemnitee shall be entitled to employ separate counsel and to
participate in the investigation and defense of any such third party action
(whether or not the Borrower has elected to assume such investigation and
defense as contemplated by clause (i) above) and (iii) the fees and expenses of
any separate counsel employed by any Indemnitee in connection with any such
third party action shall be borne by such Indemnitee except (x) under the
circumstances contemplated by subclauses (x) and (y) of clause (i) above or (y)
if such Indemnitee has reasonably concluded that the Borrower is failing
actively and diligently to defend such third party action.
SECTION 9.04. Sharing of Set-Offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate amount of principal and interest due with respect
to
43
any Note held by it which is greater than the proportion received by any other
Bank in respect of the aggregate amount of principal and interest due with
respect to any Note held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the Notes
held by the other Banks, and such other adjustments shall be made, as may be
required so that all such payments of principal and interest with respect to the
Notes held by the Banks shall be shared by the Banks pro rata; provided that
nothing in this Section shall impair the right of any Bank to exercise any right
of set-off or counterclaim it may have and to apply the amount subject to such
exercise to the payment of indebtedness of the Borrower other than its
indebtedness hereunder. Each Obligor agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation in a
Note, whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of such Obligor in the amount of such participation.
SECTION 9.05. Amendments and Waivers. Any provision of this Agreement or
the Notes may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed by each Obligor and the Required Banks (and, if the
rights or duties of either Agent are affected thereby, by such Agent); provided
that no such amendment or waiver shall, unless signed by all the Banks, (i)
increase or decrease the Commitment of any Bank (except for a ratable decrease
in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan or any
fees hereunder, (iii) postpone the date fixed for any payment of principal of or
interest on any Loan or for any scheduled termination of any Commitment, (iv)
release the Guarantor from any of its obligations under Article 10 or (v) change
the percentage of the Commitments or of the aggregate unpaid principal amount of
the Notes, or the number of Banks, which shall be required for the Banks or any
of them to take any action under this Section or any other provision of this
Agreement.
SECTION 9.06. Successors and Assigns. (a) The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, except that neither Obligor may
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "PARTICIPANT") participating interests in its Commitment or
any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to each
Obligor and the Administrative Agent, such Bank shall remain responsible for the
performance of
44
its obligations hereunder, and each Obligor and the Administrative Agent shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement. Any agreement pursuant to
which any Bank may grant such a participating interest shall provide that such
Bank shall retain the sole right and responsibility to enforce the obligations
of the Borrower hereunder including, without limitation, the right to approve
any amendment, modification or waiver of any provision of this Agreement;
provided that such participation agreement may provide that such Bank will not
agree to any modification, amendment or waiver of this Agreement described in
clause (i), (ii) or (iii) or (iv) of Section 9.05 without the consent of the
Participant. Each Obligor agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of Section
2.13 and Article 8 with respect to its participating interest. An assignment or
other transfer which is not permitted by subsection (c) or (d) below shall be
given effect for purposes of this Agreement only to the extent of and as a
participating interest granted in accordance with this subsection.
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "ASSIGNEE") all, or a proportionate part (equivalent to an
initial Commitment of not less than $15,000,000) of all, of its rights and
obligations under this Agreement and the Notes, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit D hereto executed by such Assignee and such
transferor Bank, with (and subject to) the subscribed consent of each Obligor,
which shall not be unreasonably withheld, and the Administrative Agent; provided
that if an Assignee is an affiliate of such transferor Bank or was a Bank
immediately prior to such assignment, no such consent shall be required. Upon
execution and delivery of such instrument and payment by such Assignee to such
transferor Bank of an amount equal to the purchase price agreed between such
transferor Bank and such Assignee, such Assignee shall be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank holding a Loan
as set forth in such instrument of assumption, and the transferor Bank shall be
released from its obligations hereunder to a corresponding extent, and no
further consent or action by any party shall be required. Upon the consummation
of any assignment pursuant to this subsection, the transferor Bank, the
Administrative Agent and the Borrower shall make appropriate arrangements so
that, if required, a new Note is issued to the Assignee. In connection with any
such assignment, the transferor Bank shall pay to the Administrative Agent an
administrative fee for processing such assignment in the amount of $2,500;
provided that no fee shall be paid for any such assignment which occurs within
six months of the Effective Date. If the Assignee is not incorporated under the
laws of the United States of America or a state thereof, it shall deliver to the
Borrower and the Administrative Agent certification
45
as to exemption from deduction or withholding of any United States federal
income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its rights under
this Agreement and its Note to a Federal Reserve Bank. No such assignment shall
release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights shall
be entitled to receive any greater payment under Section 8.03 or 8.04 than such
Bank would have been entitled to receive with respect to the rights transferred,
unless such transfer is made with the Borrower's prior written consent or by
reason of the provisions of Section 8.02 , 8.03 or 8.04 requiring such Bank to
designate a different Applicable Lending Office under certain circumstances or
at a time when the circumstances giving rise to such greater payment did not
exist.
SECTION 9.07. Collateral. Each of the Banks represents to the Agents and
each of the other Banks that it in good faith is not relying upon any "MARGIN
STOCK" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.08. Governing Law, Submission to Jurisdiction. This Agreement
and each Note shall be governed by and construed in accordance with the laws of
the State of New York. Each Obligor hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State court sitting in New York City for purposes
of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. Each Obligor irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
SECTION 9.09. Counterparts; Integration; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon receipt by the Administrative Agent of
counterparts hereof signed by each of the parties hereto (or, in the case of any
party as to which an executed counterpart shall not have been received, receipt
by the Administrative Agent in form satisfactory to it of telegraphic, telex,
facsimile
46
or other written confirmation from such party of execution of a counterpart
hereof by such party).
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OBLIGOR, THE AGENTS AND THE BANKS
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 9.11. Confidentiality. Each Agent and each Bank agrees to keep any
information delivered or made available by either Obligor pursuant to this
Agreement confidential from anyone other than persons employed or retained by
such Agent or such Bank who are engaged in evaluating, approving, structuring or
administering the credit facility contemplated hereby; provided that nothing
herein shall prevent an Agent or any Bank from disclosing such information (a)
to any other Bank or to an Agent, (b) to any other Person if reasonably
incidental to the administration of the credit facility contemplated hereby, (c)
upon the order of any court or administrative agency, (d) upon the request or
demand of any regulatory agency or authority, (e) which had been publicly
disclosed other than as a result of a disclosure by an Agent or any Bank
prohibited by this Agreement or, to the knowledge of such Agent or such Bank, by
any other Person as a result of a disclosure by such Person in violation of an
obligation of confidentiality, (f) to the extent necessary, in connection with
any litigation to which an Agent, any Bank or its subsidiaries or Parent may be
a party, (g) to the extent necessary in connection with the exercise of any
remedy hereunder, (h) to such Bank's or such Agent's legal counsel and
independent auditors or (i) subject to provisions substantially similar to those
contained in this Section, to any actual or proposed Participant or Assignee.
Each Bank and each Agent shall give the Borrower prompt notice of any disclosure
made by such Bank or such Agent, as the case may be, as permitted pursuant to
clauses (c), (d) (other than any such disclosure made by any Bank to bank
examiners during any examination of such Bank conducted in the ordinary course
by such examiners) or (f) of this Section, but solely to the extent permitted by
law and, in the case of any disclosure permitted pursuant to clause (f), solely
to the extent that the interests of such Bank or such Agent, as the case may be,
and the Borrower in the relevant litigation are not adverse in any material
respect.
47
ARTICLE 10
GUARANTY
SECTION 10.01. The Guaranty. Subject to Section 10.07, the Guarantor
hereby unconditionally guarantees the full and punctual payment (whether at
stated maturity, upon acceleration or otherwise) of the principal of and
interest on each Note issued by the Borrower pursuant to this Agreement, and the
full and punctual payment of all other amounts payable by the Borrower under
this Agreement (including any interest, fees, costs, expenses and other
obligations that accrue after the commencement of any bankruptcy, insolvency,
reorganization or similar case or proceeding, or which would have accrued but
for such case, proceeding or other action and whether or not such interest,
fees, costs, expenses or other obligations are allowed or allowable as a claim
in such case, proceeding or other action). Upon failure by the Borrower to pay
punctually any such amount, the Guarantor shall forthwith on demand pay the
amount not so paid at the place and in the manner specified in this Agreement.
SECTION 10.02. Guaranty Unconditional. Subject to Section 10.07, the
obligations of the Guarantor 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, compromise, waiver or release in
respect of any obligation of the Borrower under this Agreement or any
Note, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to this Agreement or any
Note;
(iii) any release, impairment, non-perfection or invalidity of any direct or
indirect security for any obligation of the Borrower under this Agreement
or any Note;
(iv) any change in the corporate existence, structure or ownership of the
Borrower, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Borrower or its assets or any resulting release
or discharge of any obligation of the Borrower contained in this Agreement
or any Note;
(v) the existence of any claim, set-off or other rights which the Guarantor
may have at any time against the Borrower, any Agent, any Bank or any
other Person, whether in connection herewith or any unrelated
48
transactions, provided that nothing herein shall prevent the assertion of
any such claim by separate suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or against the Borrower
for any reason of this Agreement or any Note, or any provision of
applicable law or regulation purporting to prohibit the payment by the
Borrower of the principal of or interest on any Note or any other amount
payable by the Borrower under this Agreement; or
(vii) any other act or omission to act or delay of any kind by the Borrower,
any Agent, any Bank or any other Person or any other circumstance
whatsoever which might, but for the provisions of this paragraph,
constitute a legal or equitable discharge of or defense to the Guarantor's
obligations hereunder.
SECTION 10.03. Discharge Only upon Payment in Full; Reinstatement In
Certain Circumstances. The Guarantor's obligations hereunder shall remain in
full force and effect until the Commitments shall have terminated and the
principal of and interest on the Notes and all other amounts payable by the
Borrower under this Agreement shall have been paid in full. If at any time any
payment of the principal of or interest on any Note or any other amount payable
by the Borrower under this Agreement is rescinded or must be otherwise restored
or returned upon the insolvency, bankruptcy or reorganization of the Borrower or
otherwise, the 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 10.04. Waiver by the Guarantor. The Guarantor irrevocably waives
acceptance hereof, presentment, demand, protest and 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 or any other Person.
SECTION 10.05. Subrogation. Upon making any payment with respect to the
Borrower hereunder, the Guarantor shall be subrogated to the rights of the payee
against the Borrower with respect to such payment; provided that the Guarantor
shall not enforce any payment by way of subrogation until all amounts of
principal of and interest on the Notes and all other amounts payable by the
Borrower under this Agreement have been paid in full.
SECTION 10.06. Stay of Acceleration. If acceleration of the time for
payment of any amount payable by the Borrower under this Agreement or the Notes
is stayed upon the insolvency, bankruptcy or reorganization of the Borrower, all
such amounts otherwise subject to acceleration under the terms of
49
this Agreement shall nonetheless be payable by the Guarantor hereunder forthwith
on demand by the Administrative Agent made at the request of the requisite
proportion of the Banks specified in Section 6.01 of this Agreement.
SECTION 10.07. Limitation of Liability. Notwithstanding the other
provisions of this Article 10, the obligations of the Guarantor hereunder shall
be limited to an aggregate amount equal to the largest amount that would not
render its obligations hereunder subject to avoidance under Section 548 of the
United States Bankruptcy Code or any comparable provisions of applicable law of
any State of the United States.
50
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
THE ▇▇▇▇▇ ▇▇▇▇▇▇ COMPANIES
INC., as Borrower
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------
Title: Vice President and Treasurer
Address: ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ INC., as Guarantor
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------
Title: Vice President and Treasurer
Address: ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Commitments:
$135,000,000 ▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Title: Vice President
$135,000,000 THE CHASE MANHATTAN BANK
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇
-------------------------------------
Title: Vice President
$135,000,000 CITIBANK, N.A.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Attorney in Fact
Total:
$405,000,000
============
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK, as
Administrative Agent
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Title: Vice President
Address: ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
THE CHASE MANHATTAN BANK , as
Co-Documentation Agent
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇
------------------------------------
Title: Vice President
Address: ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
CITIBANK, N.A., as
Co-Documentation Agent
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Title: Attorney in Fact
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
NOTE
New York, New York
___________ __, 199_
For value received, THE ▇▇▇▇▇ ▇▇▇▇▇▇ COMPANIES INC., a Delaware
corporation (the "BORROWER"), promises to pay to the order of
______________________ (the "BANK"), for the account of its Applicable Lending
Office, the unpaid principal amount of the Loan made by the Bank to the Borrower
pursuant to the Credit Agreement referred to below on the maturity date provided
for in the Credit Agreement. The Borrower promises to pay interest on the unpaid
principal amount of this Loan on the dates and at the rate or rates provided for
in the Credit Agreement. All such payments of principal and interest shall be
made in lawful money of the United States in Federal or other immediately
available funds at the office of ▇▇▇▇▇▇ Guaranty Trust Company of New York, ▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
The Loan made by the Bank and all repayments of the principal thereof
shall be recorded by the Bank and, if the Bank so elects in connection with any
transfer or enforcement hereof, appropriate notations to evidence the foregoing
information with respect to such Loan may be endorsed by the Bank on the
schedule attached hereto, or on a continuation of such schedule attached to and
made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement dated as
of January 28, 1998 among The ▇▇▇▇▇ ▇▇▇▇▇▇ Companies Inc., as Borrower, ▇▇▇▇▇
▇▇▇▇▇▇ Inc., as Guarantor, the banks listed on the signature pages thereof,
▇▇▇▇▇▇ Guaranty Trust Company of New York, as Administrative Agent, and The
Chase Manhattan Bank and Citibank, N.A., as Co-Documentation Agents (as the same
may be amended from time to time, the "CREDIT AGREEMENT"). Terms defined in the
Credit Agreement are used herein with the same meanings. Reference is made to
the Credit Agreement for provisions for the prepayment hereof and the
acceleration of the maturity hereof.
Pursuant to the terms of the Credit Agreement, the Guarantor has
unconditionally guaranteed the full and punctual payment of all amounts payable
under this Note.
This note shall be governed by, and construed in accordance with, the laws
of the State of New York.
THE ▇▇▇▇▇ ▇▇▇▇▇▇
COMPANIES INC.
By____________________
Name:
Title:
LOANS AND PAYMENTS OF PRINCIPAL
--------------------------------------------------------------------------------
AMOUNT OF
AMOUNT OF TYPE OF PRINCIPAL NOTATION
DATE LOAN LOAN REPAID MADE BY
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EXHIBIT B
OPINION OF
COUNSEL FOR THE OBLIGORS
[Closing Date]
To the Banks and the Agents
Referred to Below
c/o The Chase Manhattan Bank and Citibank, N.A.,
as Co-Documentation Agents
[address]
Gentlemen:
We have acted as counsel to The ▇▇▇▇▇ ▇▇▇▇▇▇ Companies Inc., a Delaware
corporation (the "BORROWER"), and ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., a Delaware corporation (the
"GUARANTOR" and, together with the Borrower, the "OBLIGORS"), in connection with
the preparation, authorization, execution and delivery of, and the consummation
of the transactions contemplated by, the Credit Agreement dated as of January
28, 1998, among the Borrower, the Guarantor, the banks listed on the signature
pages thereof (the "BANKS"), ▇▇▇▇▇▇ Guaranty Trust Company of New York, as
Administrative Agent, and The Chase Manhattan Bank and Citibank, N.A., as
Co-Documentation Agents (the "CREDIT AGREEMENT"). This opinion is being rendered
to you at the request of our clients pursuant to Section 3.01(b) of the Credit
Agreement. Capitalized terms defined in the Credit Agreement and used but not
otherwise defined herein are used herein as so defined.
In so acting, we have examined originals or copies, certified or otherwise
identified to our satisfaction, of the Credit Agreement and such corporate
records, agreements, documents and other instruments, and such certificates or
comparable documents of public officials and of officers and representatives of
the Obligors, and have made such inquiries of such officers and representatives,
as we have deemed relevant and necessary as a basis for the opinions hereinafter
set forth.
In such examination, we have assumed the genuineness of all signatures
other than client, the legal capacity of natural persons, the authenticity of
all documents submitted to us as originals, the conformity to original documents
of all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. As to all questions of
fact material to this opinion that have not been independently established, we
have
relied upon certificates or comparable documents of officers and representatives
of the Obligors and upon the representations and warranties of the Obligors
contained in the Credit Agreement. As used herein, "TO OUR KNOWLEDGE" means the
conscious awareness of facts or other information by any lawyer in our firm
actively involved in negotiating the transactions contemplated by the Credit
Agreement.
Based on the foregoing and subject to the qualifications stated herein, we
are of the opinion that:
1. Each of the Obligors is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all
requisite corporate power and authority to own, lease and operate its respective
properties and to carry on its respective businesses as now being conducted.
2. Each of the Obligors has all requisite corporate power and authority to
execute and deliver the Credit Agreement and, in the case of the Borrower, the
Notes, and to perform its obligations thereunder. The execution, delivery and
performance of the Credit Agreement by each of the Obligors and the Notes by the
Borrower and the consummation by each of the Obligors of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of each of the Obligors. The Credit Agreement has been duly and
validly executed and delivered by each of the Obligors, and the Notes have been
duly and validly executed and delivered by the Borrower, and (assuming the due
authorization, execution and delivery of the Credit Agreement by the Banks, the
Administrative Agent and the Co-Documentation Agents) constitute the legal,
valid and binding obligation of each of the Obligors party thereto, enforceable
against each of them in accordance with their respective terms, subject to
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors' rights and remedies generally,
and subject, as to enforceability, to general principles of equity, including
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity), except that no opinion is expressed with respect to the last
sentence of Section 9.04 of the Credit Agreement.
3. The execution and delivery of the Credit Agreement by the Obligors and
of the Notes by the Borrower, and the consummation by either of the Obligors of
the transactions contemplated thereby and compliance by each of the Obligors
with any of the provisions thereof will not conflict with, constitute a default
under or violate (i) any of the terms, conditions or provisions of the
certificate of incorporation or by-laws of either of the Obligors, (ii) to our
knowledge, any of the terms, conditions or provisions of any document, agreement
of other instrument to which either of the Obligors is party or by which either
of them is
bound, (iii) any New York, Delaware corporate or federal law or regulations, or
(iv) to our knowledge, any judgment, writ, injunction, decree, order or ruling
of any court or governmental authority binding on either of the Obligors.
4. No consent, approval, waiver, license or authorization or other action
by or filing with any New York, Delaware corporate or federal governmental
authority is required in connection with the execution and delivery by the
Obligors of the Credit Agreement or, in the case of the Borrower, the Notes, or
the consummation by either of the Obligors of the transactions contemplated
thereby.
5. To our knowledge, there is no litigation, proceeding or governmental
investigation pending or overtly threatened against either of the Obligors that
questions the validity of the Credit Agreement or the Notes or which, if
adversely determined, would have a material adverse effect on the businesses,
assets or financial condition of the Borrower and its Subsidiaries taken as a
whole.
The opinions expressed herein are limited to the laws of the State of New
York, the corporate laws of the State of Delaware and the federal laws of the
United States, and we express no opinion as to the effect on the matters covered
by this letter of the laws of any other jurisdiction.
The opinions expressed herein are rendered solely for your benefit in
connection with the transactions described herein. Those opinions may not be
used or relied upon by any other person, nor may this letter or any copies
thereof be furnished to a third party, filed with a governmental agency, quoted,
cited or otherwise referred to without our prior written consent.
Very truly yours,
(COUNSEL FOR THE BORROWER)
EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among (NAME OF ASSIGNOR) (the
"ASSIGNOR"), (NAME OF ASSIGNEE) (the "ASSIGNEE"), THE ▇▇▇▇▇ ▇▇▇▇▇▇ COMPANIES
INC. (the "BORROWER"), ▇▇▇▇▇ ▇▇▇▇▇▇ INC. (the "GUARANTOR") and ▇▇▇▇▇▇ GUARANTY
TRUST COMPANY OF NEW YORK, as Administrative Agent (the "ADMINISTRATIVE AGENT").
WHEREAS, this Assignment and Assumption Agreement (the "AGREEMENT")
relates to the Credit Agreement dated as of January 28, 1998 among the Borrower,
the Guarantor, the Assignor and the other Banks party thereto, as Banks, the
Administrative Agent, and The Chase Manhattan Bank and Citibank, N.A., as
Co-Documentation Agents (as amended, the "CREDIT AGREEMENT");
WHEREAS, the Loan made to the Borrower by the Assignor under the Credit
Agreement in the aggregate principal amount of $__________ is outstanding at the
date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the rights
of the Assignor under the Credit Agreement in respect of a portion of its
Outstanding Loan thereunder in an amount equal to $__________ (the "ASSIGNED
AMOUNT") and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Loan made by the Assignor outstanding at the date hereof. Upon the execution and
delivery hereof by the Assignor, the Assignee, [each Obligor and the
Administrative Agent] and the payment of the amounts specified in Section 3
required to be paid on the date hereof (i) the Assignee shall, as of the date
hereof, succeed to the rights and be obligated to perform the obligations of a
Bank under the Credit Agreement holding a Loan in an amount equal to the
Assigned Amount, and (ii) the Assignor shall, as of the date hereof, be released
from its obligations under the Credit Agreement to the extent such obligations
have been assumed by the Assignee. The assignment provided for herein shall be
without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them.(1) Each
of the Assignor and the Assignee hereby agrees that if it receives any amount
under the Credit Agreement which is for the account of the other party hereto,
it shall receive the same for the account of such other party to the extent of
such other party's interest therein and shall promptly pay the same to such
other party.
[SECTION 4. Consent of each Obligor and the Administrative Agent. This
Agreement is conditioned upon the consent of each Obligor and the Administrative
Agent pursuant to Section 9.06(c) of the Credit Agreement. The execution of this
Agreement by each Obligor and the Administrative Agent is evidence of this
consent. Pursuant to Section 9.06(c), the Borrower agrees to execute and deliver
a Note payable to the order of the Assignee to evidence the assignment and
assumption provided for herein.]
SECTION 5. Non-Reliance on Assignor. The Assignor makes no representation
or warranty in connection with, and shall have no responsibility with respect
to, the solvency, financial condition, or statements of either Obligor, or the
validity and enforceability of the obligations of either Obligor in respect of
the Credit Agreement or any Note. The Assignee acknowledges that it has,
independently and without reliance on the Assignor, and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and will continue to be responsible for
making its own independent appraisal of the business, affairs and financial
condition of each Obligor.
---------------------------
(1) Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee, net of any portion of
any upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula rather
than as a fixed sum.
SECTION 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date first above
written.
(NAME OF ASSIGNOR)
By_________________________
Name:
Title:
(NAME OF ASSIGNEE)
By__________________________
Name:
Title:
THE ▇▇▇▇▇ ▇▇▇▇▇▇ COMPANIES
INC.
By__________________________
Name:
Title:
▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By__________________________
Name:
Title:
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK,
as Administrative Agent
By__________________________
Name:
Title: