[LOGO OF ▇▇▇▇▇▇ AND ▇▇▇▇▇, LLP APPEARS HERE]
Exhibit 7(E)
CONFORMED/*/
REVOLVING CREDIT AGREEMENT
among
▇▇▇▇ ▇. ▇▇▇▇▇▇,
as Borrower
NATIONSBANK OF TEXAS, N.A.,
as Agent,
TORONTO DOMINION SECURITIES (USA), INC.,
as Co-Agent,
and
THE LENDERS NAMED HEREIN,
as Lenders
$130,000,000
As of
July 23, 1997
------------------------------
* Conformed to show signatures.
TABLE OF CONTENTS
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Page
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SECTION 1 DEFINITIONS...........................................................1
1.1 Definitions...........................................................1
1.2 Rules of Construction.................................................6
SECTION 2 THE REVOLVING CREDIT FACILITY.........................................6
2.1 Commitment to Lend....................................................6
2.2 Method of Borrowing...................................................7
2.3 Notes.................................................................8
2.4 Interest Rate.........................................................8
2.5 Special Provisions for Eurodollar Advances; Taxes.....................9
2.6 Payments of the Note.................................................10
2.7 Fees.................................................................11
2.8 Termination of Commitment............................................11
2.9 Sharing of Payments, Etc.............................................11
2.10 Set-off..............................................................11
2.11 Capital Adequacy.....................................................11
SECTION 3 COLLATERAL...........................................................12
3.1 Liens and Security Interests.........................................12
SECTION 4 CONDITIONS PRECEDENT.................................................12
4.1 Initial Advance......................................................12
4.2 All Advances.........................................................12
SECTION 5 REPRESENTATIONS AND WARRANTIES.......................................12
5.1 Taxes................................................................12
5.2 Pledged Shares.......................................................12
5.3 Authority and Compliance.............................................13
5.4 Binding Agreement....................................................13
5.5 Litigation...........................................................13
5.6 No Conflicting Agreements............................................13
5.7 Financial Statements.................................................13
5.8 Use of Proceeds; Margin Stock........................................13
5.9 Representations and Warranties.......................................13
5.10 Survival of Representations and Warranties...........................14
SECTION 6 COVENANTS............................................................14
6.1 Financial Statements.................................................14
6.2 Compliance...........................................................14
6.3 Adverse Conditions or Events.........................................14
6.4 Taxes and Other Obligations..........................................14
6.5 Transfer of Assets...................................................14
6.6 Liens................................................................15
6.7 Other Covenants......................................................15
6.8 Indemnity by Borrower................................................15
SECTION 7 EVENTS OF DEFAULT....................................................15
7.1 Events of Default....................................................15
7.2 Remedies Upon Event of Default.......................................16
7.3 Performance by Lender................................................16
SECTION 8 THE AGENT............................................................17
8.1 The Agent............................................................17
8.2 Expenses.............................................................18
8.3 Proportionate Absorption of Losses...................................18
8.4 Delegation of Duties; Reliance.......................................19
8.5 Limitation of Agent's Liability......................................19
8.6 Default..............................................................20
8.7 Collateral Matters...................................................20
8.8 Limitation of Liability..............................................20
8.9 Relationship of Lenders..............................................21
8.10 Benefits of Agreement................................................21
SECTION 9 MISCELLANEOUS........................................................21
9.1 Accounting Reports...................................................21
9.2 Waiver...............................................................21
9.3 Payment of Expenses..................................................21
9.4 Notices..............................................................21
9.5 Governing Law........................................................22
9.6 Choice of Forum; Consent to Service of Process and Jurisdiction......22
9.7 Invalid Provisions...................................................22
9.8 Maximum Interest Rate................................................22
9.9 Nonliability of Lenders..............................................22
9.10 Article 15.10(b).....................................................22
9.11 Successors and Assigns...............................................22
9.12 Entirety.............................................................25
9.13 Headings.............................................................25
9.14 Survival.............................................................25
9.15 Amendments, Etc......................................................25
9.16 No Third Party Beneficiary...........................................25
9.17 WAIVER OF JURY TRIAL.................................................25
9.18 Multiple Counterparts................................................26
9.19 Confidentiality......................................................26
9.20 Arbitration..........................................................26
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT (this "Agreement"), dated as of July 23,
1997, is made among ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Borrower"), each of the Persons listed on
the signature pages hereof (herein collectively called, together with each
Person that becomes a Lender pursuant to Section 9.11, the "Lenders," and
individually a "Lender"), and NATIONSBANK OF TEXAS, N.A., a national banking
association, as agent for Lenders to the extent and in the manner provided in
Section 8 (herein called, together with any successors and assigns, "Agent,")
and Toronto Dominion Securities (USA), Inc. as Co-Agent for Lenders.
R E C I T A L S
- - - - - - - -
1. Borrower has requested that Lenders provide to Borrower a revolving
credit facility of up to $130,000,000.00 to provide funds for the purchase of
the common stock of Tele-Communications, Inc. ("TCI") and for other business
investments, and to pay accrued interest on the Loan.
2. Lenders are willing to provide such a facility to Borrower, upon the
terms, and subject to the conditions, hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises herein contained,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1 DEFINITIONS.
1.1 Definitions. As used in this Agreement, all exhibits and schedules
hereto and in any note, certificate, report, or other Loan Document made or
delivered pursuant to this Agreement, the following terms have the respective
meanings assigned to them in this Section 1, or in the section or recital
referred to below:
"Advance" means (a) each disbursement by Lenders of a sum or sums lent to
Borrower pursuant to this Agreement, (b) each conversion of an Advance to
another Type or Advance, and (c) each rollover of a Eurodollar Advance to a
successive Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly,
controlling, controlled by, or under common control with, such Person.
"Agent" has the meaning set forth in the first paragraph of this Agreement.
"Agent's Lending Office" means Agent's lending office located at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, or such other address as Agent may hereafter
designate in writing as Agent's Lending Office by notice to Borrower and
Lenders.
"Agreement" means this Revolving Credit Agreement, including the schedules
and exhibits hereto, as the same may be renewed, extended, or modified from
time-to-time.
"Applicable Lending Office" means for each Lender and each Type of Advance,
the lending office of such Lender (or of an Affiliate of such Lender) designated
for such Type of Advance below its name on the signature pages hereof or an
Assignment and Acceptance, or such other office of such Lender (or
of an Affiliate of such Lender) as such Lender may from time-to-time specify to
Borrower and Agent as the office by which its Advances of such Type are to be
made and maintained.
"Assignee" has the meaning set forth in Section 9.11(b).
"Assigning Lender" has the meaning set forth in Section 9.11(b).
"Assignment and Acceptance" means an assignment and acceptance entered into
by an Assigning Lender and its Assignee and accepted by Agent pursuant to
Section 9.11, in substantially the form of Exhibit A.
"Borrower" has the meaning set forth in the first paragraph of this
Agreement.
"Business Day" means (a) any day on which Agent is open for regular
business, and (b) with respect to all borrowings, payments, conversions,
continuations, Interest Periods, and notices in connection with Eurodollar
Advances, any day which is a Business Day described in clause (a) above and
which is also a day on which dealings in Dollar deposits are carried out in the
London interbank market.
"Co-Agent" means Toronto Dominion Securities (USA), Inc.
"Code" means the Internal Revenue Code of 1986, as amended, and all
regulations promulgated and rulings issued thereunder.
"Collateral" has the meaning assigned to such term in the Pledge Agreement.
"Collateral Documents" means the Pledge Agreement and all security
agreements, pledge agreements, and other agreements or documents executed or
delivered to secure repayment of the Obligation, or any part thereof.
"Commitment" means, as to each Lender as of any date, the obligation of
such Lender on such date to make Advances hereunder in an aggregate principal
amount at any time outstanding up to but not exceeding the amount set forth
below its name on the signature pages hereof (or in an Assignment and
Acceptance) as its Commitment, as the same may be reduced pursuant to the terms
hereof.
"Commitments" means the Commitments of all Lenders in the original
aggregate principal amount of $130,000,000.00.
"Contract Rate" means (a) with respect to a Prime Rate Advance, the Prime
Rate, and (b) with respect to a Eurodollar Advance, the Eurodollar Rate plus
seven-eighths of one percent (0.875%).
"Default Rate" means a per annum rate of interest equal from day-to-day to
the lesser of (a) the sum of the Prime Rate plus three percent (3%), and (b) the
Maximum Rate.
"Dollars" and "$" mean lawful money of the United States of America.
"Eligible Assignee" means any commercial bank, savings and loan
association, savings bank, finance company, insurance company, pension fund,
mutual fund, or other financial institution (whether a corporation, partnership,
or other entity) approved by Agent and, so long as no Potential Default or Event
of Default has occurred and is continuing, Borrower, such approvals not to be
unreasonably withheld.
"Eurodollar Advance" means any Advance hereunder with respect to which the
interest rate is calculated by reference to the Eurodollar Rate for a particular
Interest Period.
"Eurodollar Rate" means, for any Eurodollar Advance for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/16th of one percent) equal to the rate appearing on page "LIBO" on the ▇▇▇▇▇▇
Monitor System (or any successor page; or in the absence thereof, an equivalent
source obtained by Agent) as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two (2) Business Days prior to
the first (1st) day of such Interest Period for a term comparable to such
Interest Period.
"Eurodollar Reserve Requirement" means, for any Lender on any day, that
percentage (expressed as a decimal fraction) that is in effect on such day, as
provided by the Board of Governors of the Federal Reserve System (or any
successor governmental body), applied for determining the reserve requirements
of such Lender (including, without limitation, basic, supplemental, marginal,
and emergency reserves) under Regulation D, with respect to "Eurocurrency
liabilities" as currently defined in Regulation D, or under any similar or
successor regulation with respect to Eurocurrency liabilities or Eurocurrency
funding. Each determination by any Lender of the Eurodollar Reserve Requirement
shall, in the absence of manifest error, be conclusive and binding.
"Event of Default" has the meaning set forth in Section 7.1.
"Federal Funds Rate" means, on any day, the annual rate (rounded upwards,
if necessary, to the nearest 0.01%) determined by Agent (which determination is
conclusive and binding, absent manifest error) to be equal to the weighted
average of the rates on overnight federal funds transactions with member banks
of the Federal Reserve System arranged by federal funds brokers as published by
the Federal Reserve Bank of New York on the next successive Business Day;
provided, however, that (a) if such determination date is not a Business Day,
the Federal Funds Rate for such day shall be the rate for such transactions on
the next preceding Business Day as published on the next successive Business
Day, or (b) if those rates are not published for any Business Day, the Federal
Funds Rate shall be the average of the quotations at approximately 10:00 a.m. on
such Business Day received by Agent from three (3) federal funds brokers of
recognized standing selected by Agent in its sole discretion.
"Funding Loss" has the meaning set forth in Exhibit D.
"Governmental Authority" means any nation or government, any state or
political subdivision thereof, and any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government.
"Governmental Requirement" means any federal, state, local, municipal,
foreign, international, multinational, or other administrative order,
constitution, law, ordinance, principle of common law, regulation, statute, or
treaty as in effect on the date hereof.
"Initial Collateral" shall mean the shares of common stock more fully
described on Exhibit F attached hereto.
"Interest Period" means, with respect to a Eurodollar Advance, a period
commencing:
(a) on the borrowing date of such Eurodollar Advance; or (b) on the
conversion date pertaining to such Eurodollar Advance, if made pursuant to a
conversion as described in Section 2.2(c);
or (c) on the last day of the preceding Interest Period, in the case of a
rollover to a successive Interest Period;
and ending one (1), two (2), three (3), four (4), or six (6) months thereafter,
as Borrower shall elect in accordance with Section 2.2(c); provided that:
(i) any Interest Period that would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business Day, unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day; (ii) any Interest Period that
begins on the last 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 (i) above, end on the last Business
Day of a calendar month; and (iii) if the Interest Period for any Eurodollar
Advance would otherwise end after the final maturity date of the Loan, then such
Interest Period shall end on the final maturity date of the Loan.
"Lender" and "Lenders" has the meanings set forth in the first paragraph of
this Agreement.
"Lien" means any lien, mortgage, security interest, tax lien, pledge,
negative pledge, encumbrance, conditional sale, or title retention arrangement,
or any other interest in property designed to secure the repayment of
indebtedness, whether arising by agreement, or under any statute, law, or
otherwise.
"Loan" means the revolving credit loan made or to be made hereunder to
Borrower by Lenders pursuant to Section 2.1.
"Loan Documents" means this Agreement, the Notes, the Collateral Documents,
and any agreements, documents (and with respect to this Agreement, and such
other agreements and documents, any renewals, extensions, amendments, or
supplements thereto), or certificates at any time executed or delivered pursuant
to the terms of this Agreement.
"Margin Requirements" shall mean all statutes, regulations and
interpretations pertaining to extensions of credit to purchase or carry, or
extensions of credit secured (directly or indirectly) by, margin stock,
including without limitation, the certification, loan-to-value, and other
requirements of the Securities Exchange Act of 1934 and Regulations U and X of
the Board of Governors of the Federal Reserve System, and any successor
regulations.
"Material Adverse Effect" means any material adverse change in, or effect
upon, (a) the validity, performance, or enforceability of any Loan Document, (b)
the financial condition of Borrower, or (c) the ability of Borrower to fulfill
its obligations under the Loan Documents.
"Maximum Rate" means the highest nonusurious rate of interest (if any)
permitted from day-to- day by applicable law. Agent and Lenders hereby notify
and disclose to Borrower that, for purposes of Tex. Rev. Civ. Stat. ▇▇▇. art.
5069-1.04, as it may from time-to-time be amended, the "applicable rate ceiling"
shall be the "indicated rate" ceiling from time-to-time in effect, as limited by
article 5069-1.04(b); provided, however, that to the extent permitted by
applicable law, Agent and Lenders reserve the right to change the "applicable
rate ceiling" from time-to-time by further notice and disclosure to Borrower.
"Notes" means the Revolving Credit Notes in substantially the form of
Exhibit B, executed by Borrower and delivered pursuant to the terms of this
Agreement, together with any renewals, extensions, or modifications thereof, and
"Note" means any one of the Notes.
"Notice of Borrowing" means, with respect to any Advance, a notice
substantially in the form of Exhibit C.
"Obligation" means all present and future Indebtedness, obligations, and
liabilities, and all renewals and extensions thereof, or any part thereof, now
or hereafter owed to Agent or any Lender by Borrower arising pursuant to any of
the Loan Documents, and all renewals and extensions thereof, together with all
interest accruing thereon, and costs, expenses, and reasonable attorneys' fees
incurred in the enforcement or collection thereof.
"Person" includes an individual, corporation, joint venture, general or
limited partnership, limited liability company, trust, unincorporated
organization, or government, or any agency or political subdivision thereof.
"Pledge Agreement" shall mean that certain Pledge Agreement, dated as of
the date hereof, executed by Borrower in favor of Agent, Co-Agent and Lenders,
and any renewals, extensions, modifications or restatements thereof.
"Pledged Shares" shall have the meaning assigned to such term in the Pledge
Agreement.
"Potential Default" means the occurrence of any event which with passage of
time, or giving of notice, or both, could become an Event of Default.
"Prime Rate" means, at any time, the greater of (a) the variable rate of
interest established from time-to-time by Agent as its "prime rate" and set by
Agent as a general reference rate of interest charged by Agent, and (b) the
Federal Funds Rate plus one-half of one percent (.5%). Borrower acknowledges
that Agent may, from time-to-time, extend credit to other borrowers at rates of
interest varying from, and having no relationship to, such general reference
rate. Each change in the Prime Rate shall become effective without prior notice
to Borrower automatically as of the opening of business on the date of such
change in the Prime Rate.
"Prime Rate Advance" means any Advance hereunder with respect to which the
interest rate is calculated by reference to the Prime Rate.
"Principal Debt" means, at the time of any determination thereof, the
aggregate unpaid principal balance of all Advances.
"Pro Rata" and "Pro Rata Part" means, on any date of determination thereof
for any Lender (a) at any time prior to the termination of the Commitments, the
proportion that such Lender's Commitment bears to the Commitments of all
Lenders, and (b) at any time on and after the termination of the Commitments,
the proportion that the Principal Debt owed to such Lender bears to the
Principal Debt owed to all Lenders.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System, from time-to-time in effect, and shall include any successor or
other regulation relating to reserve requirements applicable to member banks of
the Federal Reserve System.
"Required Lenders" means, as of any date, any combination of Lenders who
collectively hold fifty-one percent (51%) of (i) the sum of the Commitments, or
(ii) if the Commitments have been terminated, then of the Principal Debt owed
all Lenders.
"Taxes" means, for any Person, taxes, assessments, or other governmental
charges or levies imposed upon it, its income, or any of its properties,
franchises, or assets.
"Termination Date" means the earlier of (a) July 22, 1999, (b) the date
Lenders' commitments to fund Advances hereunder are terminated pursuant to
Section 7.2, or (c) the date that Lenders' commitments to fund Advances
hereunder are reduced to zero pursuant to Section 2.1(b).
"Type" means any type of Advance (i.e., Prime Rate Advance or Eurodollar
Advance).
1.2 Rules of Construction. When used in this Agreement: (a) "or" is not
exclusive; (b) a reference to a law includes any amendment or modification to
such law; (c) a reference to a Person includes its permitted successors and
permitted assigns; (d) except as provided otherwise, all references to the
singular shall include the plural, and vice versa; (e) except as provided in
this Agreement, a reference to an agreement, instrument, or document shall
include such agreement, instrument, or document, as the same may be amended,
modified, or supplemented from time-to-time, in accordance with its terms and as
permitted by the Loan Documents; (f) all references to Sections, Exhibits, and
Schedules shall be to sections of and exhibits and schedules to this Agreement,
unless otherwise indicated; (g) all Exhibits and Schedules to this Agreement
shall be incorporated into this Agreement; (h) the words "include," "includes,"
and "including" shall be deemed to be followed by the phrase "without
limitation;" and (i) except as otherwise provided herein, in the computation of
time, from a specified date to a later specified date, the word "from" means
"from and including," and words "to" and "until" each mean "to but excluding."
SECTION 2 THE REVOLVING CREDIT FACILITY.
2.1 Commitment to Lend.
(a) Commitment. Subject to and in reliance upon the terms, conditions,
representations, and warranties in the Loan Documents, each Lender severally and
not jointly agrees to lend to Borrower such Lender's Pro Rata Part of one or
more Advances not to exceed such Lender's Commitment, which, subject to the Loan
Documents, Borrower may borrow, repay, and reborrow under this Agreement;
provided that each such Advance must occur on a Business Day preceding the
Termination Date.
(b) Voluntary Termination of Commitments. Without premium or penalty, and
upon giving not less than five (5) Business Days prior written and irrevocable
notice to Agent, Borrower may terminate in whole or in part the unused portion
of the Commitments; provided that: (i) each partial termination shall be in an
amount of not less than $500,000.00 or a greater integral multiple thereof; (ii)
the amount of the Commitments may not be reduced below the amount of the
Obligation at such time; and (iii) each reduction shall be allocated to each
Lender's Commitment Pro Rata among all Lenders in accordance with their
respective Pro Rata Parts. Promptly after receipt of such notice or termination
or reduction, Agent shall notify each Lender of the cancellation or reduction.
(c) Collateral Requirements. As a condition to Lenders' obligation to make
any Advance hereunder, Borrower must be in compliance with the requirements of
Section 6 of the Pledge Agreement related to maintenance of Collateral and with
all Margin Requirements. In addition, Borrower shall be obligated to deliver
additional Collateral to Agent or prepay the Notes, on the terms set forth in
Section 6 of the Pledge Agreement, or as required to satisfy Margin
Requirements.
(d) Use of Proceeds. Borrower shall use the proceeds of the Loan for the
purposes described in the Preamble. Borrower shall not use proceeds of any
Advance (i) for any unlawful purpose, or (ii) for the purpose of making any
hostile tender offer to acquire shares of stock or other equity interests in
another Person.
2.2 Method of Borrowing.
(a) Application for Advance. Borrower shall deliver to Agent a Notice of
Borrowing at least one (1) Business Day prior to any Prime Rate Advance and at
least three (3) Business Days prior to any Eurodollar Advance. Each Notice of
Borrowing must be received by Agent no later than 1:00 p.m. (Dallas, Texas time)
as of the applicable date. Prior to making a Notice of Borrowing, Borrower may
(without specifying whether the Advance shall be a Prime Rate Advance or a
Eurodollar Advance) request that Agent provide Borrower with the most recent
Eurodollar Rate. Agent shall endeavor to provide such quoted rate to Borrower
on the date of such request.
(b) Funding.
(i) Promptly after receipt of a Notice of Borrowing under Section
2.2(a), Agent shall notify each Lender by telex or telecopy, or other
similar form of transmission, of the proposed Advance. Each Lender shall
deposit an amount equal to its Pro Rata Part of the Advance requested by
Borrower with Agent at its Lending Office, in immediately available funds
not later than 11:00 a.m. (Dallas, Texas time) on the date of such proposed
Advance. Upon fulfillment of all applicable conditions set forth herein,
Agent shall make available to Borrower at Agent's Lending Office, not later
than 2:00 p.m. (Dallas, Texas time) on the date of each Advance, the
proceeds of each Lender's Pro Rata Part of the Advance actually received by
Agent. The failure of any Lender to deposit the amount described above
with Agent shall not relieve any other Lender of its obligations hereunder
to make its Advance.
(ii) Unless Agent shall have been notified by any Lender that such
Lender will not make available to Agent such Lender's Pro Rata Part of a
proposed Advance, Agent may in its discretion assume that such Lender has
made such Advance available to Agent in accordance with this Section and
Agent may, if it chooses, in reliance upon such assumption, make such
Advance available to Borrower. If and to the extent such Lender shall not
so make its Pro Rata Part of the proposed Advance available to Agent, such
Lender severally agrees to pay or repay to Agent on demand the amount of
such Advance together with interest thereon, for each day from the date
such Advance is made available to Borrower until the date such amount is
paid or repaid to Agent at the Federal Funds Rate. If such Lender shall
repay to Agent such amount, such amounts so repaid shall constitute such
Lender's Advance for purposes of this Agreement.
(c) Selection of Interest Option Period.
(i) Upon making a Notice of Borrowing under Section 2.2(a), Borrower
shall advise Agent as to whether the Advance shall be (A) a Eurodollar
Advance, in which case Borrower shall specify the applicable Interest
Period therefor, or (B) a Prime Rate Advance.
(ii) Subject to the dollar limits and denominations of Section 2.1,
Borrower may (a) convert a Eurodollar Advance on the last day of the
applicable Interest Period to a Prime Rate Advance, (b) convert a Prime
Rate Advance on any Business Day to a Eurodollar Advance, and (c) elect a
new Interest Period for a Eurodollar Advance, by giving a Notice of
Borrowing to Agent no later than 1:00 p.m. (Dallas, Texas time) on the
third (3rd) Business Day before the
conversion date or the last day of the Interest Period, as the case may be
(for conversion to a Eurodollar Advance or election of a new Interest
Period), and no later than 1:00 p.m. (Dallas, Texas time) one (1) Business
Day before the last day of the Interest Period (for conversion to a Prime
Rate Advance). Absent Borrower's Notice of Borrowing, a Eurodollar Advance
shall be deemed converted to a Prime Rate Advance effective when the
applicable Interest Period expires.
(iii) Notwithstanding anything to the contrary contained herein, (A)
no more than three (3) Interest Periods shall be in effect at any one time
with respect to Eurodollar Advances, and (B) Borrower shall have no right
to request a Eurodollar Advance if the Interest Rate applicable thereto
under Section 2.4 would exceed the Maximum Rate in effect on the first day
of the Interest Period applicable to such Advance.
(iv) Each Notice of Borrowing shall be irrevocable and binding on
Borrower and, in respect of any Eurodollar Advance specified in such Notice
of Borrowing, Borrower shall indemnify Agent and Lenders against any
Funding Loss incurred by Agent or Lenders as a result of (A) any failure to
fulfill, on or before the date specified for such Advance, the conditions
to such Advance set forth herein, or (B) Borrower's requesting that an
Advance not be made on the date specified for such Advance in the Notice of
Borrowing. A certificate of Agent and each Lender establishing the amount
due from Borrower according to the preceding sentence, together with a
description in reasonable detail of the manner in which such amount has
been calculated, shall be presumed to be correct in the absence of manifest
error.
2.3 Notes. The Loan made under Section 2.1 by Lenders shall be evidenced
by the Notes, one payable to each Lender in the stated amount of its Commitment,
in the aggregate principal amount of $130,000,000.00.
2.4 Interest Rate.
(a) All Advances. The unpaid principal of each Prime Rate Advance shall
bear interest from the date of Advance to the date of repayment thereof at a
rate per annum that shall from day-to-day be equal to the lesser of (i) the
Prime Rate in effect from day-to-day, and (ii) the Maximum Rate. The unpaid
principal of each Eurodollar Advance shall bear interest from the date of
advance to the date of repayment thereof at a rate per annum that shall be equal
to the lesser of (i) the Eurodollar Rate plus seven-eighths of one percent
(0.875%), and (ii) the Maximum Rate.
(b) Default Rate. All past due principal of, and to the extent permitted
by applicable law, interest on, the Note, shall bear interest until paid at the
lesser of (i) the Default Rate, and (ii) the Maximum Rate.
(c) Recapture Rate. If the applicable Contract Rate ever exceeds the
Maximum Rate, thereby causing the interest charged under the Notes to be limited
to the Maximum Rate, then, to the extent permitted by applicable law, any
subsequent reductions in the applicable Contract Rate shall not reduce the rate
of interest charged under the Notes below the Maximum Rate, until the total
amount of interest accrued on the Notes equals the amount of interest that would
have accrued thereon if the applicable Contract Rate had at all times been in
effect.
(d) General Provisions as to Interest.
(i) Interest will be calculated on the basis of actual number of days
(including the first day but excluding the last day) elapsed but computed:
(A) with respect to Eurodollar Advances, as if each calendar year consisted
of 360 days (unless the calculation would result in an interest rate
greater than the Maximum Rate, in which event interest will be calculated
on the basis of a year of 365 or 366 days, as the case may be); and (B)
with respect to Prime Rate Advances, on the basis of a year of 365 or 366
days, as the case may be. All interest rate determinations and
calculations by Agent are presumed to be correct in the absence of manifest
error.
(ii) The provisions of this Agreement relating to calculation of the
Prime Rate and the Eurodollar Rate are included only for the purpose of
determining the rate of interest or other amounts to be paid under this
Agreement that are based upon those rates. Each Lender may fund and
maintain its funding of all or any part of each Advance as it selects.
2.5 Special Provisions for Eurodollar Advances; Taxes.
(a) Eurodollar Advances. With respect to Eurodollar Advances, the
provisions of Exhibit D (regarding inadequacy of pricing, illegality, increased
costs, and funding losses) shall apply.
(b) Taxes. Subject to Section 2.5(c), any Taxes payable by Agent or any
Lender or ruled (by a Governmental Authority) payable by Agent or any Lender in
respect of this Agreement or any other Loan Document shall, if permitted by
Governmental Requirement, be paid by Borrower, together with interest and
penalties, if any (except for Taxes imposed on or measured by the overall net
income of Agent or such Lender). Agent or such Lender (through Agent) shall
notify Borrower and deliver to Borrower a certificate setting forth in
reasonable detail the calculation of the amount of payable Taxes, which
certificate is presumed to be correct in the absence of manifest error, and
Borrower shall promptly pay that amount to Agent for its account or the account
of such Lender, as the case may be. If Agent or such Lender subsequently
receives a refund of the Taxes paid to it by Borrower, then the recipient shall
promptly pay the refund to Borrower.
(c) Foreign Lenders. Each Lender that is organized under the Governmental
Requirements of any jurisdiction other than the United States of America or any
State thereof (i) represents to Agent and Borrower that (A) no Taxes are
required to be withheld by Agent or Borrower with respect to any payments to be
made to it in respect of the Obligation, and (B) it has furnished to Agent and
Borrower two (2) duly completed copies of U.S. Internal Revenue Service Form
4224, Form 1001, Form W-8, or any other tax form acceptable to the
Administrative Agent (wherein it claims entitlement to complete exemption from
U.S. federal withholding tax on all interest payments under the Loan Documents),
and (ii) covenants to (A) provide Agent and Borrower a new tax form upon the
expiration or obsolescence of any previously delivered form according to
Governmental Requirement, duly executed and completed by it, and (B) comply from
time-to-time with all Governmental Requirements with regard to the withholding
tax exemption. If any of the foregoing is not true or the applicable forms are
not provided, then Borrower or Agent (without duplication) may deduct and
withhold from interest payments under the Loan Documents United States federal
income tax at the full rate applicable under the Code.
(d) Survival. Without prejudice to the survival of any other obligations
of Borrower hereunder, the obligations of Borrower under this Section 2.5 shall
survive the termination of this Agreement and/or the payment or assignment of
the Notes.
2.6 Payments of the Note.
(a) Payment of Interest on the Notes. Interest on each Eurodollar
Advance shall be due and payable as it accrues on the last day of its respective
Interest Period; provided that if any Interest Period is a period greater than
three (3) months, then accrued interest shall also be due and payable on the
date three (3) months after the commencement of such Interest Period. Interest
on each Prime Rate Advance shall be due and payable as it accrues on the last
day of each calendar quarter, and on the Termination Date.
(b) Payment of Principal of the Notes. The Notes shall mature, and the
principal amount thereof shall be due and payable, on the Termination Date.
(c) Optional Prepayments. Upon three (3) Business Days' notice for
Eurodollar Advances and one (1) Business Day's notice for Prime Rate Advances,
Borrower may prepay the principal of any of the Notes then outstanding, in whole
or in part, at any time or from time to time; provided, however, that (i) each
prepayment of less than the full outstanding principal balance of a Note shall
be in an amount equal to at least $250,000.00, and (ii) if Borrower prepays the
principal of any Eurodollar Advance on any date other than the last day of the
Interest Period applicable thereto, Borrower shall pay any Funding Loss with
respect to such payment. Any optional prepayment of the principal of the Notes
shall be applied to the Notes on a pro rata basis based upon the outstanding
principal balances of the Notes as of the date of payment.
(d) Mandatory Prepayments. Borrower shall be obligated to make
mandatory prepayments on the Notes, in accordance with Section 2.1(c) hereof.
(e) General Provisions as to Payments.
(i) All payments of principal of, and interest on, any Note to or
for the account of any Lender shall be made by Borrower to Agent before
12:00 p.m. (Dallas, Texas time), in Federal or other immediately available
funds at Agent's Lending Office. If the principal of, or interest on, a
Note, or any other amount payable hereunder, becomes due and payable on a
day other than a Business Day, then the maturity thereof shall be extended
to the next succeeding Business Day. Each payment received by Agent
hereunder for the account of a Lender shall be promptly distributed by
Agent to such Lender. Except as otherwise provided, all payments made on
any Note shall be credited, to the extent of the amount thereof, in the
following manner: (A) first, against the amount of interest accrued and
unpaid on such Note as of the date of such payment; (B) second, against all
principal (if any) due and owing on such Note as of the date of such
payment; (C) third, as a prepayment of outstanding Prime Rate Advances
under such Note; and (D) fourth, as a prepayment of outstanding Eurodollar
Advances under such Note. Subject to the foregoing, so long as no Potential
Default or Event of Default exists, payments and prepayments of principal
of any Note shall be applied to such outstanding Prime Rate Advances and
Eurodollar Advances under such Note as Borrower shall select; provided,
however, that Borrower shall select Prime Rate Advances and Eurodollar
Advances to be repaid in a manner designed to minimize the Funding Loss, if
any, resulting from such payments; and provided further that, if Borrower
shall fail to select the Prime Rate Advance or Eurodollar Advance to which
such payments are to be applied, or if a Potential Default or Event of
Default exists at the time of such payment, then Agent shall be entitled to
apply the payment to such Prime Rate Advances and Eurodollar Advances in
the manner it shall deem appropriate.
(ii) Each payment received by Agent hereunder for the account of
Lenders or any of them on the Notes shall be distributed to each Lender
entitled to share in such payment, Pro Rata in proportion to the Pro Rata
Parts of each Lender (less any taxes, levies, imposts, deductions, charges
or withholdings excluded from the definition of Taxes). Unless Agent shall
have received notice from Borrower prior to the date on which any payment
is due to Lenders hereunder that Borrower will not make such payment in
full, Agent may assume that Borrower has made such payment in full to Agent
on such date and Agent may, in reliance upon such assumption, cause to be
distributed to each Lender on such due date an amount equal to the amount
then due such Lender. If and to the extent Borrower shall not have so made
such payment in full to Agent, each Lender shall repay to Agent forthwith
on demand such amount distributed to such Lender together with interest
thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to Agent, at the
Federal Funds Rate.
2.7 Fees. Borrower shall pay to Agent, for the ratable benefit of
Lenders, in accordance with their respective Pro Rata Parts, a commitment fee
equal to $260,000.00 (i.e., 20 basis points on the Commitment). Borrower
acknowledges that such fee is a bona fide commitment fee and is intended as
reasonable compensation to Lenders for committing to make funds available to
Borrower as described herein, and for no other purposes.
2.8 Termination of Commitment. The Commitments shall terminate on the
Termination Date, and any Advances then outstanding (together with accrued
interest thereon) shall be due and payable on such date.
2.9 Sharing of Payments, Etc. If any Lender obtains any amount (whether
voluntary, involuntary, or otherwise, including as a result of exercising any
rights under Section 2.10) that exceeds the part of that payment that such
Lender is entitled to receive under the Loan Documents, then such Lender shall
purchase from the other Lenders participations that will cause the purchasing
Lender to share the excess amount ratably with each other Lender. If all or any
portion of any excess amount is subsequently recovered from the purchasing
Lender, then the purchase shall be rescinded and the purchase price restored to
the extent of the recovery. Borrower agrees that any Lender purchasing a
participation from another Lender under this Section, may, to the fullest extent
permitted by applicable law, exercise all of its rights of payment with respect
to that participation as fully as if such lender were the direct creditor of
Borrower in the amount of that participation.
2.10 Set-off. If an Event of Default exists, each Lender is entitled,
but not obligated, to exercise (for the benefit of all Lenders in accordance
with Section 2.10) the right of off-set and banker's Lien against each and every
account and other property, or any interest therein, that Borrower may now or
hereafter have with, or which is now or hereafter in the possession of, such
Lender to the extent of the amount of the Obligation owed to it.
2.11 Capital Adequacy. If a Lender shall have reasonably determined
that, after the date hereof, either (i) the adoption of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change therein,
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 (ii) compliance by such Lender (or
any lending office of such Lender) with 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 such Lender's capital as a consequence of its or Borrower's
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, change or compliance by an amount reasonably
deemed by such Lender to be material, then from time to time, within ten (10)
days after
demand by such Lender, Borrower shall pay to such Lender such additional amount
as will adequately compensate such Lender for such reduction. A Lender will
notify Borrower of any event of which it has actual knowledge, occurring after
the date thereof, which will entitle such Lender to compensation pursuant to
this Section 2.12. No failure by a Lender to immediately demand payment of any
additional amounts payable hereunder shall constitute a waiver of such Lender's
right to demand payment of such amounts at any subsequent time.
SECTION 3 COLLATERAL.
3.1 Liens and Security Interests. To secure the performance by Borrower
of the payment and performance of the Obligation, pursuant to the Collateral
Documents, Borrower grants to Lenders a perfected, first priority, security
interest and lien in the Pledged Shares and other Collateral, including without
limitation the Initial Collateral.
SECTION 4 CONDITIONS PRECEDENT.
4.1. Initial Advance. The obligation of each Lender to make its initial
Advance hereunder is subject to the conditions precedent that, on or before the
date of such Advance, (a) Borrower shall have paid to Agent (i) all fees to be
received pursuant to this Agreement or any other Loan Document and (ii) an
amount equal to the estimated costs and out-of-pocket expenses of Agent's
counsel incurred in connection with the preparation, execution and delivery of
the Loan Documents and the consummation of the transactions contemplated
thereby, and (b) Agent shall have received duly executed copies of each of the
documents listed on Exhibit E, each dated as of the date of such Advance, and
each in form and substance satisfactory to Agent.
4.2. All Advances. The obligation of each Lender to make any Advance
under this Agreement (including the initial Advance but excluding any Advance
which does not increase the outstanding Principal Debt) shall be subject to the
conditions precedent that, as of the date of such Advance and after giving
effect thereto: (a) there exists no Potential Default or Event of Default; (b)
no change that would cause a Material Adverse Effect has occurred since the date
of the financial statements referenced in Section 5.7; (c) Agent shall have
received from Borrower a Notice of Borrowing dated as of the date of such
Advance and all of the statements contained in such Notice of Borrowing shall be
true and correct; (d) the representations and warranties contained in each of
the Loan Documents shall be true in all respects as though made on the date of
such Advance; (e) the Maximum Rate exceeds the Contract Rate; and (f) Borrower
has satisfied the condition precedent contained in Section 2.1(c).
SECTION 5 REPRESENTATIONS AND WARRANTIES.
Borrower hereby represents and warrants to Lenders as follows:
5.1 Taxes. All tax returns required to be filed by Borrower in any
jurisdiction have been filed and all taxes, assessments, fees, and other
governmental charges upon Borrower, or upon any of his properties, or income,
have been paid, except for taxes being contested in good faith by appropriate
proceedings diligently projected and as to which adequate reserves have been
established. Borrower has no knowledge of any proposed tax assessment against
Borrower that will have, or is reasonably likely to have, a Material Adverse
Effect.
5.2 Pledged Shares. The Pledged Shares constituting the Initial
Collateral, as described on Exhibit F, were acquired by Borrower, and held by
Borrower, for a period of at least two (2) years prior to the date hereof, for
purposes of determining the holding period of such Pledged Shares under Rule 144
of the General Regulations under the Securities Act of 1933 promulgated by the
Securities and Exchange Commission, and Borrower has borne the full economic
risk of such Pledged Shares since their respective dates of acquisition.
Borrower is the lawful owner and holder of such Pledged Shares, free and clear
of all Liens, except for security interests and liens granted to Lenders. Under
the laws of the State of Colorado, and other applicable laws, Borrower has full
right, power, and authority to pledge such Pledged Shares to Lenders, and such
pledge does not violate or contravene any law, agreement, or order to which
Borrower is subject.
5.3 Authority and Compliance. Borrower has full power and authority to
execute and deliver the Loan Documents and to incur and perform the obligations
provided for therein. No consent or approval of any public authority or other
third party is required as a condition to the validity of any Loan Document, and
Borrower is in compliance with all laws and regulatory requirements to which it
is subject.
5.4 Binding Agreement. This Agreement and the other Loan Documents
executed by Borrower constitute valid and legally binding obligations of
Borrower, enforceable in accordance with their terms.
5.5 Litigation. There is no proceeding against Borrower pending or, to
the knowledge of Borrower, threatened by or before any court or Governmental
Authority in which Borrower is a party in its individual capacity except as
disclosed on Exhibit G attached hereto. There are no outstanding judgments
against Borrower.
5.6 No Conflicting Agreements. There is no provision of any existing
agreement, mortgage, indenture or contract binding on Borrower or affecting
Borrower's property, which would conflict with or in any way prevent the
execution, delivery or carrying out of the terms of this Agreement and the other
Loan Documents.
5.7 Financial Statements. The personal financial statements of Borrower
heretofore delivered to Lenders, and dated July 18, 1997, properly reflect
Borrower's financial position as of the date thereof, and there has been no
material adverse change in Borrower's financial condition since the date of the
financial statements. Borrower has good title to all assets reflected on such
financial statements, except as disclosed in such financial statements.
Borrower has no material indebtedness or liabilities, including guaranties and
other contingent liabilities, which are not reflected in such financial
statements. To the best of Borrower's knowledge, all factual information
furnished by Borrower to Lenders in connection with this Agreement is and will
be accurate and complete on the date as of which such information is delivered
to Lenders and is not incomplete by the omission of any material fact necessary
to make such information not misleading.
5.8 Use of Proceeds; Margin Stock. The proceeds of the Loan will be used
by Borrower solely for the purposes specified in Section 2.1(d). If requested by
Agent or a Lender, Borrower will from time to time furnish to Agent or Lenders a
statement in conformity with the requirements of Federal Reserve Form U-1
referred to in Regulation U of the Board of Governors of the Federal Reserve
System. No Advance will be used for any purpose which violates, or is
inconsistent with, the Margin Requirements.
5.9 Representations and Warranties. Each Notice of Borrowing (other than
a Notice of Borrowing which requests an Advance that would not increase the
Principal Debt) shall constitute, without the necessity of specifically
containing a written statement, a representation and warranty by Borrower that
no Potential Default or Event of Default exists, and that all representations
and warranties contained in
this Section 5 or in any other Loan Document are true and correct on and as of
the date the requested Advance is to be made.
5.10 Survival of Representations and Warranties. All representations and
warranties by Borrower herein shall survive delivery of the Notes and the making
of the Loan, and any investigation at any time made by or on behalf of Agent or
any Lender shall not diminish Agent's or Lenders' right to rely thereon.
SECTION 6. COVENANTS. Until full payment and performance of all obligations of
Borrower under the Loan Documents, Borrower will:
6.1. Financial Statements. Furnish to Agent, or cause to be furnished to
Agent:
(a) Annual financial statements of Borrower within thirty (30) days
after the anniversary date of the most recent financial statement provided
to Agent, in form and substance satisfactory to Agent, and including
without limitation a listing of all assets and liabilities, a listing of
all sources of income, a listing of the uses of income, the amount and
sources of contingent liabilities, and identification of joint or community
owners as to listed assets.
(b) A Compliance Certificate for Borrower, concurrently with and dated
as of the date of delivery of each financial statement as required by this
Section 6.1, stating: "This financial statement is being submitted to
NationsBank of Texas, N.A., Agent, for the purpose of obtaining credit and
constitutes the true and correct statement of my/our financial condition."
The certification must be executed and dated by Borrower.
(c) Promptly following Agent's reasonable request, which request
(whether one or more) may be made from time to time, such additional
information, reports and statements respecting the financial condition of
Borrower.
6.2. Compliance. Maintain Borrower's compliance with all Governmental
Requirements applicable to Borrower or to any of Borrower's property, business
operations and transactions.
6.3. Adverse Conditions or Events. Promptly advise Agent in writing of
(i) any condition, event or act which comes to Borrower's attention that would
or might materially adversely affect Borrower's financial condition, the
Collateral, or Lenders' rights under the Loan Documents; (ii) any litigation
filed by or against Borrower which could reasonably be expected to have a
Material Adverse Effect; (iii) any default under the Loan Documents; and (iv)
any default under any agreement, mortgage, indenture or contract binding on
Borrower which could reasonably be expected to have a Material Adverse Effect,
or any such default which affects the Collateral.
6.4. Taxes and Other Obligations. File on a timely basis all tax
returns, and pay all of Borrower's taxes and other obligations as the same
become due and payable, except to the extent being contested in good faith by
appropriate proceedings.
6.5. Transfer of Assets. Not sell, lease, assign, transfer or otherwise
dispose of assets, during the term of this Agreement, having an aggregate value
in excess of $300,000,000.
6.6. Liens. Not grant, suffer or permit any Lien on any Collateral,
except in favor of Lenders; or take any action which would adversely affect or
impair Lenders' Liens in Collateral or right to dispose
of Collateral following an Event of Default; or fail to promptly pay when due
all lawful claims, whether for labor, materials or otherwise.
6.7. Other Covenants. Not violate or fail to comply with any covenants or
agreements regarding other indebtedness which could reasonably be expected to
have a Material Adverse Effect.
6.8 Indemnity by Borrower. Indemnify, defend and hold harmless Agent,
each Lender and its directors, officers, agents, attorneys, and employees
(individually, an "Indemnitee" and collectively, the "Indemnitees") from and
against any and all loss, liability, damage, judgment, claim, and expense
(including attorneys' fees and amounts paid in settlement) to which the
Indemnitees may become subject arising out of this Agreement and the other Loan
Documents, the business of Borrower, or the use of proceeds of the Loan, other
than those which arise by reason of the gross negligence or willful misconduct
of Lenders. This indemnification shall survive the satisfaction and payment of
the Obligation and termination of this Agreement.
SECTION 7. EVENTS OF DEFAULT.
7.1. Events of Default. An "Event of Default" shall exist if any one or
more of the following events (herein collectively called "Events of Default")
shall occur and be continuing:
(a) Borrower shall fail to pay when due the Obligation or any
part thereof, and solely with respect to payments of interest on the Notes,
such failure or refusal continues for three (3) Business Days;
(b) any representation or warranty made under this Agreement, or
any of the other Loan Documents, shall prove to be untrue or inaccurate in
any material respect as of the date on which such representation or
warranty is made;
(c) default shall occur in the performance of any of the
covenants or agreements of Borrower contained herein (other than Section
7.1(a) above), or in any of the other Loan Documents, which default is not
remedied within ten (10) days after written notice thereof to Borrower from
Lender; provided, that such ten (10) day grace period shall not apply to
covenants and agreements contained in Article 2, or Sections 6.3, 6.5 or
6.6 of this Agreement, or in the Pledge Agreement, or in the Rule 144 Rider
attached to the Pledge Agreement;
(d) default shall occur in the payment of the unpaid balance of,
or any installment of principal or interest of, indebtedness of Borrower
(other than the Obligation) having an aggregate principal balance exceeding
the sum of $1,000,000 or default shall occur in respect of any note or
credit agreement relating to any such indebtedness and such default shall
continue for more than the period of grace, if any, specified therein the
effect of which is to cause, or to permit any holder of such indebtedness
to cause (whether or not such holder elects to cause) any of that
indebtedness to become due before its stated maturity;
(e) any of the Loan Documents shall cease to be legal, valid and
binding agreements enforceable against the Person executing the same in
accordance with its terms, shall be terminated, become or be declared
ineffective or inoperative or cease to provide the respective liens,
security interests, rights, titles, interests, remedies, powers or
privileges intended to be provided thereby;
(f) Borrower shall (i) apply for or consent to the appointment of
a receiver, trustee, custodian, intervenor or liquidator of itself or of
all or a substantial part of such Borrower's assets, (ii) file a voluntary
petition in bankruptcy, admit in writing that Borrower is unable to pay
such Borrower's debts as they become due or generally not pay such
Borrower's debts as they become due, (iii) make a general assignment for
the benefit of creditors, (iv) file a petition or answer seeking
reorganization of an arrangement with creditors or to take advantage of any
bankruptcy or insolvency laws, (v) file an answer admitting the material
allegations of, or consent to, or default in answering, a petition filed
against Borrower in any bankruptcy, reorganization or insolvency
proceeding, or (vi) take any action for the purpose of effecting any of the
foregoing;
(g) An involuntary proceeding shall be commenced against Borrower
seeking bankruptcy or reorganization of Borrower or the appointment of a
receiver, custodian, trustee, liquidator or other similar official of
Borrower, or all or substantially all of Borrower's assets, and such
proceeding shall not have been dismissed within sixty (60) days of the
filing thereof; or an order, order for relief, judgment or decree shall be
entered by any court of competent jurisdiction or other competent authority
approving a petition or complaint seeking reorganization of Borrower, or
appointing a receiver, custodian, trustee, liquidator or other similar
official of Borrower, or of all or substantially all of Borrower's assets;
(h) any final judgment(s) for the payment of money in excess of
the sum of $1,000,000 in the aggregate shall be rendered against Borrower,
and such judgment(s) shall not be satisfied or discharged at least ten (10)
days prior to the date on which any of Borrower's assets could be lawfully
sold to satisfy such judgment; or
(i) Borrower shall die.
7.2 Remedies Upon Event of Default. If any Event of Default shall occur,
Agent may, at the request of the Required Lenders, without notice, exercise any
one or more of the following rights and remedies, and any other remedies
provided in any of the Loan Documents, as Agent, at the request of Lenders, in
their discretion may deem necessary or appropriate: (a) terminate the commitment
to lend hereunder, (b) declare the Obligation, or any part thereof, to be
forthwith due and payable, whereupon the same shall forthwith become due and
payable without presentment, demand, protest, notice of default, notice of
acceleration or of intention to accelerate, or other notice of any kind, all of
which Borrower hereby expressly waives, anything contained herein or in the
Notes to the contrary notwithstanding, (c) reduce any claim to judgment, or (d)
without notice of default or demand, pursue and enforce any of Agent's or
Lenders' rights and remedies under the Loan Documents, or otherwise provided
under or pursuant to any applicable law or agreement; provided, however, that if
any Event of Default specified in Sections 7.1(f) or (g) shall occur, the
Obligation shall thereupon become due and payable concurrently therewith, and
Lenders' obligation to lend shall immediately terminate hereunder, without any
further action by Agent or Lenders and without presentment, demand, protest,
notice of default, notice of acceleration or of intention to accelerate, or
other notice of any kind, all of which Borrower hereby expressly waives.
7.3 Performance by Lender. Should Borrower fail to perform any covenant,
duty, or agreement contained in any of the Loan Documents, Agent may perform or
attempt to perform such covenant, duty or agreement on behalf of Borrower. In
such event, Borrower shall, at the request of Agent, promptly pay any amount
expended by Agent in such performance or attempted performance to Agent at its
principal office in Dallas, Texas, together with interest thereon at the Maximum
Rate from the date of such expenditure until paid. Notwithstanding the
foregoing, it is expressly understood that Agent shall not assume any liability
or responsibility for the performance of any duties of Borrower
hereunder or under any of the Loan Documents, and none of the covenants or other
provisions contained in this Agreement shall, or shall be deemed to, give Agent
the right or power to exercise control over the management and affairs of
Borrower.
SECTION 8. THE AGENT.
8.1 The Agent.
(a) Appointment. Each Lender appoints Agent (including, without
limitation, each successor Agent in accordance with this Section 8) as its
nominee and agent to act in its name and on its behalf (and Agent and each such
successor accepts that appointment): (i) to act as its nominee and on its
behalf in and under all Loan Documents; (ii) to arrange the means whereby its
funds are to be made available to Borrower under the Loan Documents; (iii) to
take any action that it properly requests under the Loan Documents (subject to
the concurrence of other Lenders as may be required under the Loan Documents);
(iv) to receive all documents and items to be furnished to it under the Loan
Documents; (v) to be the secured party, mortgagee, beneficiary, recipient, and
similar party in respect of any Collateral, for the benefit of Lenders; (vi) to
promptly distribute to it all financial statements, compliance certificates,
notices received hereunder, and other items specifically required to be
delivered to it hereunder, and, upon request, such other material information,
requests, documents, and items received under the Loan Documents; (vii) to
promptly distribute to it its ratable part of each payment or prepayment
(whether voluntary, as proceeds of Collateral upon or after foreclosure, as
proceeds of insurance thereon, or otherwise) in accordance with the terms of the
Loan Documents; and (viii) to deliver to the appropriate Persons requests,
demands, approvals, and consents received from it. However, Agent may not be
required to take any action that exposes it to personal liability or that is
contrary to any Loan Document or applicable Governmental Requirement.
(b) Successor. Agent may assign all of its rights and obligations as
Agent under the Loan Documents to any of its Affiliates, which Affiliate shall
then be the successor Agent under the Loan Documents. Agent may also voluntarily
resign by notice to Borrower and Lenders, and shall resign upon the request of
the Required Lenders for cause (i.e., Agent is continuing to fail to perform its
responsibilities as Agent under the Loan Documents). If the initial or any
successor Agent ever ceases to be a party to this Agreement or if the initial or
any successor Agent ever resigns (whether voluntarily or at the request of the
Required Lenders), then the Required Lenders shall (which, if no Potential
Default or Event of Default exists, is subject to Borrower's approval that may
not be unreasonably withheld) appoint the successor Agent from among Lenders
(other than the resigning Agent). If the Required Lenders fail to appoint a
successor Agent within thirty (30) days after the resigning Agent has given
notice of resignation or the Required Lenders have removed the resigning Agent,
then the resigning Agent may, on behalf of Lenders, appoint a successor Agent
(which, if no Potential Default or Event of Default exists, is subject to
Borrower's approval that may not be unreasonably withheld), which must be a
commercial bank having a combined capital and surplus of at least
$1,000,000,000.00 (as shown on its most recently published statement of
condition) and whose debt obligations (or whose parent's debt obligations) are
rated not less than Baa1 by ▇▇▇▇▇'▇ or BBB+ by S & P. Upon its acceptance of
appointment as successor Agent, the successor Agent succeeds to and becomes
vested with all of the rights of the prior Agent, and the prior Agent is
discharged from its duties and obligations of the Agent under the Loan
Documents, and each Lender shall execute the documents that any Lender, the
resigning or removed Agent, or the successor Agent reasonably request to reflect
the change. After any Agent's resignation or removal as Agent under the Loan
Documents, the provisions of this Section inure to its benefit as to any actions
taken or not taken by it while it was the Agent under the Loan Documents.
(c) Rights as Lender. Agent, in its capacity as a Lender, has the same
rights under the Loan Documents as any other Lender and may exercise those
rights as if it were not acting as an Agent. The term "Lender," unless the
context otherwise indicates, includes the Agent. Agent's resignation or removal
does not impair or otherwise affect any rights that it has or may have in its
capacity as an individual Lender. Each Lender and Borrower agree Agent is not a
fiduciary for Lenders or for Borrower but is simply acting in the capacity
described in this Agreement to alleviate administrative burdens for Borrower and
Lenders, that Agent has no duties or responsibilities to Lenders or Borrower
except those expressly set forth in the Loan Documents, and that Agent in its
capacity as a Lender has the same rights as any other Lender.
(d) Other Activities. Agent or any Lender may now or in the future be
engaged in one or more loan, letter of credit, leasing, or other financing
transactions with Borrower, act as trustee or depositary for Borrower, or
otherwise be engaged in other transactions with Borrower (collectively, the
"other activities") not the subject of the Loan Documents. Without limiting the
rights of Lenders specifically set forth in the Loan Documents, neither Agent
nor any Lender is responsible to account to the other Lenders for those other
activities, and no Lender shall have any interest in any other Lender's
activities, any present or future guaranties by or for the account of Borrower
that are not contemplated by or included in the Loan Documents, any present or
future offset exercised by Agent or any Lender in respect of those other
activities, any present or future property taken as security for any of those
other activities, or any property now or hereafter in Agent's or any other
Lender's possession or control that may be or become security for the
obligations of Borrower arising under the Loan Documents by reason of the
general description of indebtedness secured or of property contained in any
other agreements, documents, or instruments related to any of those other
activities (but, if any payments in respect of those guaranties or that property
or the proceeds thereof is applied by Agent or any Lender to reduce the
Obligation, then each Lender is entitled to share ratably in the application as
provided in the Loan Documents).
(e) Additional Pledged Shares. The Pledge Agreement contemplates that,
-------------------------
under certain circumstances, Borrower may provide additional, or substituted,
Collateral as security for the Obligation, provided that such additional or
substituted Collateral is satisfactory to Agent, in its sole discretion.
Without the prior written or oral approval of Lenders, Agent shall not approve
as satisfactory additional or substitute Collateral, unless such Collateral
consists of shares of common stock of the same series and issue as the
Collateral.
8.2 Expenses. Should Agent commence any proceeding or in any way seek
to enforce its rights under the Loan Documents, irrespective of whether as a
result thereof Agent shall acquire title to any Collateral, either through
foreclosure, deed in lieu of foreclosure, or otherwise, each Lender, upon demand
therefor from time-to-time, shall contribute its share (based on its Pro Rata
Part) of the reasonable costs and/or expenses of any such enforcement or
acquisition, including, but not limited to, fees of receivers or trustees, court
costs, title company charges, filing and recording fees, appraisers' fees and
fees and expenses of attorneys to the extent not otherwise reimbursed by
Borrower. Without limiting the generality of the foregoing, each Lender shall
contribute its share (based on its Pro Rata Part) of all reasonable costs and
expenses incurred by Agent (including reasonable attorneys' fees and expenses)
if Agent employs counsel for advice or other representation (whether or not any
suit has been or shall be filed) with respect to any Collateral or any part
thereof, or any of the Loan Documents, or the attempt to enforce any Lien in any
of the Collateral, or to enforce any rights of Agent or any of Borrower's or any
other Company's obligations under any of the Loan Documents, but not with
respect to any dispute between Agent and any other Lender(s). Any loss of
principal and interest resulting from any Potential Default or Event of Default
shall be shared by Lenders in accordance with their respective Pro Rata Parts.
It is understood and agreed that if Agent determines that it is necessary to
engage counsel for Lenders
from and after the occurrence of a Potential Default or Default, then said
counsel shall be selected by Agent and written notice of the same shall be
delivered to Lenders.
8.3 Proportionate Absorption of Losses. Except as otherwise provided in
the Loan Documents, nothing in the Loan Documents gives any Lender any advantage
over any other Lender insofar as the Obligation is concerned or relieves any
Lender from ratably absorbing any losses sustained with respect to the
Obligation (except to the extent unilateral actions or inactions by any Lender
result in Borrower or any other obligor on the Obligation having any credit,
allowance, setoff, defense, or counterclaim solely with respect to all or any
part of that Lender's Pro Rata Part of the Obligation).
8.4 Delegation of Duties; Reliance. Lenders may perform any of their
duties or exercise any of their rights under the Loan Documents by or through
Agent, and Lenders and Agent may perform any of their duties or exercise any of
their rights under the Loan Documents by or through their respective officers,
agents, or other representatives. Agent, Lenders, and their respective
officers, agents, or other representatives (a) are entitled to rely upon (and
shall be protected in relying upon) any written or oral statement believed by it
or them to be genuine and correct and to have been signed or made by the proper
Person and, with respect to legal matters, upon opinion of counsel selected by
Agent or that Lender (but nothing in this clause (a) permits Agent to rely on
(i) oral statements if a writing is required by this Agreement or (ii) any other
writing if a specific writing is required by this Agreement), (b) are entitled
to deem and treat each Lender as the owner and holder of its portion of the
Obligation for all purposes until, written notice of the assignment or transfer
is given to and received by Agent (and any request, authorization, consent, or
approval of any Lender is conclusive and binding on each subsequent holder,
assignee, or transferee of or participant in that Lender's portion of the
Obligation until that notice is given and received), (c) are not deemed to have
notice of the occurrence of a Potential Default or Event of Default unless a
responsible officer of Agent, who handles matters associated with the Loan
Documents and transactions thereunder, has actual knowledge or Agent has been
notified by a Lender or Borrower, and (d) are entitled to consult with legal
counsel (including counsel for Borrower), independent accountants, and other
experts selected by Agent and are not liable for any action taken or not taken
in good faith by it in accordance with the advice of counsel, accountants, or
experts.
8.5 Limitation of Agent's Liability'.
(a) Exculpation. Neither Agent nor any of its Affiliates or officers,
agents or other representatives will be liable for any action taken or omitted
to be taken by it or them under the Loan Documents in good faith and believed by
it or them to be within the discretion or power conferred upon it or them by the
Loan Documents or be responsible for the consequences of any error of judgment
(except for fraud, gross negligence, or willful misconduct), and neither Agent
nor any of its Affiliates or officers, agents, or other representatives has a
fiduciary relationship with any Lender by virtue of the Loan Documents (but
nothing in this Agreement negates the obligation of Agent to account for funds
received by it for the account of any Lender).
(b) Indemnity. Unless indemnified to its satisfaction against loss,
cost, liability, and expense, Agent may not be compelled to do any act under the
Loan Documents or to take any action toward the execution or enforcement of the
powers thereby created or to prosecute or defend any suit in respect of the Loan
Documents. If Agent requests instructions from Lenders, or the Required Lenders,
as the case may be, with respect to any act or action in connection with any
Loan Document, then Agent is entitled to refrain (without incurring any
liability to any Person by so refraining) from that act or action unless and
until it has received instructions. In no event, however, may Agent or any of
its officers, agents, or other representatives be required to take any action
that it or they determine could incur for it or them criminal or onerous civil
liability. Without limiting the generality of the foregoing, no Lender has any
right of action against Agent as a result of Agent's acting or refraining from
acting under this Agreement in accordance with instructions of the Required
Lenders.
(c) Reliance. Agent is not responsible to any Lender or any participant
for, and each Lender represents and warrants that it has not relied upon any
Agent in respect of, (i) the creditworthiness of Borrower and the risks involved
to that Lender, (ii) the effectiveness, enforceability, genuineness, validity,
or the due execution of any Loan Document (except by Agent), (iii) any
representation, warranty, document, certificate, report, or statement made
therein (except by Agent) or furnished thereunder or in connection therewith,
(iv) the adequacy of any Collateral now or hereafter securing the Obligation or
the existence, priority, or perfection of any Lien now or hereafter granted or
purported to be granted on the Collateral under any Loan Document, or (v)
observation of or compliance with any of the terms, covenants, or conditions of
any Loan Document on the part of Borrower. EACH LENDER AGREES TO INDEMNIFY
AGENT AND ITS OFFICERS, AGENTS, AND OTHER REPRESENTATIVES AND HOLD THEM HARMLESS
FROM AND AGAINST (BUT LIMITED TO SUCH LENDER'S PRO RATA PART) ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, REASONABLE EXPENSES, AND REASONABLE DISBURSEMENTS OF ANY KIND OR NATURE
WHATSOEVER THAT MAY BE IMPOSED ON, ASSERTED AGAINST, OR INCURRED BY THEM IN ANY
WAY RELATING TO OR ARISING OUT OF THE LOAN DOCUMENTS OR ANY ACTION TAKEN OR
OMITTED BY THEM UNDER THE LOAN DOCUMENTS IF SUCH AGENT AND ITS OFFICERS, AGENTS
OR OTHER REPRESENTATIVES ARE NOT REIMBURSED FOR SUCH AMOUNTS BY BORROWER.
ALTHOUGH AGENT AND ITS OFFICERS, AGENTS, AND OTHER REPRESENTATIVES HAVE THE
RIGHT TO BE INDEMNIFIED UNDER THIS AGREEMENT FOR ITS OR THEIR OWN ORDINARY
NEGLIGENCE, AGENT AND ITS OFFICERS, AGENTS, AND OTHER REPRESENTATIVES DO NOT
HAVE THE RIGHT TO BE INDEMNIFIED UNDER THIS AGREEMENT FOR ITS OR THEIR OWN
FRAUD, GROSS NEGLIGENCE, OR WILLFUL MISCONDUCT.
8.6 Default. While an Event of Default exists, Lenders agree to promptly
confer in order that the Required Lenders or Lenders, as the case may be, may
agree upon a course of action for the enforcement of the rights of Lenders.
Agent is entitled to act or refrain from taking any action (without incurring
any liability to any Person for so acting or refraining) unless and until it has
received instructions from Required Lenders or all Lenders, as the case may be.
In actions with respect to any of Borrower's property, Agent is acting for the
ratable benefit of each Lender.
8.7 Collateral Matters.
(a) Each Lender authorizes and directs Agent to enter into the Loan
Documents and agrees that any action taken by Agent concerning any Collateral
(with the consent or at the request of the Required Lenders) in accordance with
any Loan Document, that Agent's exercise (with the consent or at the request of
the Required Lenders) of powers concerning the Collateral in any Loan Document,
and that all other reasonably incidental powers are authorized and binding upon
all Lenders.
(b) Agent is authorized on behalf of all Lenders, without the necessity
of any notice to or further consent from any Lender, from time-to-time before a
Potential Default or Event of Default, to take any action with respect to any
Collateral or Loan Documents related to Collateral that may be necessary to
perfect and maintain Agent's Liens in the Collateral.
(c) Except to use the same standard of care that it ordinarily uses for
collateral for its sole benefit, Agent has no obligation whatsoever to any
Lender or to any other Person to assure that the Collateral exists or is owned
by Borrower or is cared for, protected, or insured or has been encumbered or
that Agent's Liens have been properly or sufficiently or lawfully created,
perfected, protected, or enforced or are entitled to any particular priority.
(d) Agent shall exercise the same care and prudent judgment with respect
to the Collateral and the Loan Documents as it normally and customarily
exercises in respect of similar collateral and security documents.
8.8 Limitation of Liability. No Lender or any Participant will incur any
liability to any other Lender or Participant except for acts or omissions in bad
faith, and neither Agent nor any Lender or Participant will incur any liability
to any other Person for any act or omission of any other Lender or any
Participant.
8.9. Relationship of Lenders. The Loan Documents do not create a
partnership or joint venture among Agent and Lenders or among Lenders.
8.10. Benefits of Agreement. None of the provisions of this Section inure
to the benefit of Borrower or any other Person except Agent and Lenders.
Therefore, neither Borrower nor any other Person is responsible or liable for,
entitled to rely upon, or entitled to raise as a defense -- in any manner
whatsoever -- the failure of Agent or any Lender to comply with these
provisions.
SECTION 9. MISCELLANEOUS.
9.1 Accounting Reports. All financial reports or projections, furnished
by any Person to Agent and Lenders pursuant to this Agreement shall be prepared
in such form and such detail as shall be satisfactory to Agent, shall be
prepared on the same basis as those prepared by such Person in prior years.
9.2 Waiver. No failure to exercise, and no delay in exercising, on the
part of Agent or Lenders, any right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right. The rights of Agent and
Lenders under the Loan Documents shall be in addition to all other rights
provided by law. No modification or waiver of any provision of any Loan
Document, nor consent to departure therefrom, shall be effective unless in
writing, and no such consent or waiver shall extend beyond the particular case
and purpose involved. No notice or demand given in any case shall constitute a
waiver of the right to take other action in the same, similar or other instances
without such notice or demand.
9.3 Payment of Expenses. Borrower hereby agrees to pay on demand: (a)
all reasonable costs and expenses of Agent in connection with the preparation,
negotiation, execution, and delivery of this Agreement and the other Loan
Documents including, without limitation, the reasonable legal fees and expenses
of legal counsel for Agent; (b) all reasonable costs and expenses of Agent in
connection with any and all amendments, modifications, renewals, extension, and
supplements of any of the Loan Documents; (c) all reasonable costs and expenses
of Agent and Lenders in connection with any Event of Default and the enforcement
of this Agreement or any other Loan Document, including, without limitation, the
fees and expenses of legal counsel for Agent and Lenders; (d) all transfer,
stamp, documentary, or other similar taxes, assessments, or charges levied by
any Governmental Authority in respect of this Agreement or any of the other Loan
Documents; (e) all costs, expenses, assessments, and other charges incurred in
connection with any filing, registration, recording, or perfection of any
security interest or Lien contemplated by this Agreement or any other Loan
Document; and (f) all other reasonable costs and expenses incurred by Agent in
connection with this Agreement or any other Loan Document.
9.4 Notices. Any communications required or permitted to be given by
any of the Loan Documents must be (a) in writing and personally delivered or
mailed by prepaid certified or registered mail or by reputable overnight
courier, or (b) made by facsimile transmission delivered or transmitted, to the
party to whom such notice of communication is directed, to the address of such
party shown opposite
its name on the signature pages hereof. Any such communication shall be deemed
to have been given (whether actually received or not) on the day it is
personally delivered or, if transmitted by facsimile transmission, on the day
that such communication is transmitted as aforesaid subject to telephone
confirmation of receipt; provided, however, that any notice received by Agent
after 1:00 p.m. Dallas, Texas time on any day from Borrower pursuant to Section
2.2 or 2.3 (with respect to a Notice of Borrowing) shall be deemed for the
purposes of such section to have been given by Borrower on the next succeeding
day, or if mailed, on the third day after it is marked as aforesaid. Any party
may change its address for purposes of this Agreement by giving notice of such
change to the other parties pursuant to this Section 9.4.
9.5 Governing Law. This Agreement has been prepared, is being executed
and delivered, and is intended to be performed in the State of Texas, and the
substantive laws of such state and the applicable federal laws of the United
States of America shall govern the validity, construction, enforcement, and
interpretation of this Agreement and all of the other Loan Documents.
9.6 Choice of Forum; Consent to Service of Process and Jurisdiction. Any
suit, action, or proceeding against Borrower with respect to this Agreement, the
Notes, or any judgment entered by any court in respect thereof, may be brought
in the courts of the State of Texas, County of Dallas, or in the United States
courts located in the State of Texas, as Agent and Lenders in their sole
discretion may elect and Borrower hereby irrevocably submits to the nonexclusive
jurisdiction of such courts for the purpose of any such suit, action, or
proceeding.
9.7 Invalid Provisions. Any provision of any Loan Document held by a
court of competent jurisdiction to be illegal, invalid, or unenforceable shall
not invalidate the remaining provisions of such Loan Document, which shall
remain in full force, and the effect thereof shall be confined to the provision
held invalid or illegal.
9.8 Maximum Interest Rate. Regardless of any provision contained in any
of the Loan Documents, neither Agent nor any Lender shall ever be entitled to
receive, collect, or apply as interest on the Notes any amount in excess of
interest calculated at the Maximum Rate, and, in the event that any Agent or any
Lender ever receives, collects, or applies as interest any such excess, the
amount which would be excessive interest shall be deemed to be a partial
prepayment of principal, and treated hereunder as such; and, if the principal
amount of the Obligation is paid in full, any remaining excess shall forthwith
be paid to Borrower. In determining whether or not the interest paid or payable
under any specific contingency exceeds interest calculated at the Maximum Rate,
Borrower and Lenders shall, to the maximum extent permitted under applicable
law, (a) characterize any nonprincipal payment as an expense, fee, or premium,
rather than as interest; (b) exclude voluntary prepayments and the effects
thereof; and (c) amortize, prorate, allocate, and spread, in equal parts, the
total amount of interest throughout the entire contemplated term of the Note;
provided that, if the Notes are paid and performed in full prior to the end of
the full contemplated term thereof, and if the interest received for the actual
period of existence thereof exceeds interest calculated at the Maximum Rate,
Agent and Lenders shall refund to Borrower the amount of such excess, or credit
the amount of such excess against the principal amount of the Notes, and, in
such event, Agent and Lenders shall not be subject to any penalties provided by
any laws for contracting for, charging, taking, reserving, or receiving interest
in excess of interest calculated at the Maximum Rate.
9.9 Nonliability of Lenders. The relationship between Borrower and
Lenders is, and shall at all times remain, solely that of Borrower and Lenders,
and Lenders have no fiduciary or other special relationship with Borrower.
9.10 Article 15.10(b). Borrower, Agent, and Lenders hereby agree that,
except for Section 15.10(b) thereof, the provisions of Art. 5069-15.01 et seq.
of the Revised Civil Statutes of Texas, 1925, as amended (regulating certain
revolving credit loans and revolving tri-party accounts) shall not apply to the
Loan Documents.
9.11 Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Borrower may not
assign or transfer any of its rights or obligations hereunder without the prior
written consent of Agent and all Lenders. Any Lender may sell participations to
one or more banks or other institutions in or to all or a portion of its rights
and obligations under this Agreement and the other Loan Documents (including,
without limitation, all or a portion of its Commitments and the Advances owing
to it); provided, however, that (i) such Lender's obligations under this
Agreement and the other Loan Documents (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender shall remain solely
responsible to Borrower for the performance of such obligations, (iii) such
Lender shall remain the holder of its Notes for all purposes of this Agreement,
(iv) Borrower shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents, and (v) such Lender shall not sell a participation
that conveys to the participant the right to vote or give or withhold consents
under this Agreement or any other Loan Document, other than the right to vote
upon or consent to (A) any increase of such Lender's Commitments, (B) any
reduction of the principal amount of, or interest to be paid on, the Advances of
such Lender, (C) any reduction of any commitment fee or other amount payable to
such Bank under any Loan Document, or (D) any postponement of any date for the
payment of any amount payable in respect of the Advances of such Lender.
(b) Borrower and Lenders agree that any Lender (an "Assigning Lender")
may at any time assign to one or more Eligible Assignees all, or a portion of
all, of its rights and obligations under this Agreement and the other Loan
Documents (including, without limitation, its Commitment and Advances) (each an
"Assignee"); provided, however, that (i) except in the case of an assignment of
all of a Lender's rights and obligations under this Agreement and the other Loan
Documents, the amount of the Commitments of the assigning Lender being assigned
pursuant to each assignment (determined as of the date of the Assignment and
Acceptance with respect to such assignment) shall in no event be less than
$25,000,000.00, (ii) the parties to each such assignment shall execute and
deliver to Agent for its acceptance and recording in the Register (as defined
below), an Assignment and Acceptance, together with the Note subject to such
assignment, and a processing and recordation fee of $3,000.00; and (iii) Agent
and Borrower consent to the assignment (and with respect to Borrower, Borrower
furnishes written evidence of its consent to Agent), which consent shall not be
unreasonably withheld. Upon such execution, delivery, acceptance, and recording,
from and after the effective date specified in each Assignment and Acceptance,
which effective date shall be at least five (5) Business Days after the
execution thereof, or, if so specified in such Assignment and Acceptance, the
date of acceptance thereof by Agent, (x) the assignee thereunder shall be a
party hereto as a "Lender" and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder and under the Loan
Documents and (y) the Lender that is an assignor thereunder shall, to the extent
that rights and obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Agreement and the other Loan Documents (and, in the case
of an Assignment and Acceptance covering all or the remaining portion of a
Lender's rights and obligations under the Loan Documents, such Lender shall
cease to be a party thereto).
(c) By executing and delivering an Assignment and Acceptance, the Assigning
Lender and its Assignee confirm to and agree with each other and the other
parties hereto as follows: (i) other than as provided in such Assignment and
Acceptance, such Assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties, or
representations made in or in connection with the Loan Documents or the
execution, legality, validity, and enforceability, genuineness, sufficiency, or
value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (ii) such Assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrower or the performance or observance by Borrower of its obligations under
the Loan Documents; (iii) the Assignee confirms that it has received copies of
the Loan Documents, together with copies of the financial statements referred to
in Section 5.7 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) the Assignee will, independently and without
reliance upon Agent or such assignor and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement and the other Loan
Documents; (v) the Assignee confirms that it is an Eligible Assignee; (vi) the
Assignee appoints and authorizes Agent to take such action as Agent on its
behalf and exercise such powers under the Loan Documents as are delegated to
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; and (vii) the Assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.
(d) Agent shall maintain at its principal office a copy of each Assignment
and Acceptance delivered to and accepted by it and a register for the
recordation of the names and addresses of Lenders and the Commitment of, and
principal amount of the Advances owing to, each Lender from time-to-time (the
"Register"). The entries in the Register shall be conclusive and binding for
all purposes, absent manifest error, and Borrower, Agent, and Lenders may treat
each Person whose name is recorded in the Register as a Lender hereunder for all
purposes under the Loan Documents. The Register shall be available for
inspection by Borrower or any Lender at any reasonable time and from time-to-
time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
Assigning Lender and Assignee representing that it is an Eligible Assignee (or
other assignee permitted hereunder), together with any Note subject to such
assignment, Agent shall, if such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit A, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register, and
(iii) give prompt written notice thereof to Borrower. Within five (5) Business
Days after its receipt of such notice, Borrower shall execute and deliver to
Agent in exchange for the surrendered Note a new Note to the order of such
Eligible Assignee (or other assignee permitted hereunder) in an amount equal to
the portion of the Commitments assumed by it pursuant to such Assignment and
Acceptance and, if the Assigning Lender has retained a portion of the
Commitments, a new Note to the order of the Assigning Lender in an amount equal
to the portion of the Commitments retained by it hereunder (each such promissory
note shall constitute a "Note" for purposes of the Loan Documents). Such new
Notes shall be in an aggregate principal amount of the surrendered Note, shall
be dated the effective date of such Assignment and Acceptance, and shall
otherwise be in substantially the form of Exhibit B.
(f) Any Lender may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section, disclose to the
Assignee or participant or proposed Assignee or participant, any information
relating to Borrower furnished to such, Lender by or on behalf of Borrower,
subject to the confidentiality requirements in Section 9.19.
(g) Notwithstanding any other term of this Agreement to the contrary, any
Lender may (without requesting the consent of either Agent or Borrower) pledge
its Note to a Federal Reserve Bank in support of borrowings made by such Lender
from such Federal Reserve Bank.
(h) Notwithstanding any other term of this Agreement to the contrary, any
Lender may assign all, or a portion of all, of its rights and obligations under
this Agreement and the other Loan Documents (including, without limitation, its
Commitment and Advances) to an Affiliate of such Lender or any other Lender,
provided that:
(i) such assignor Lender has obtained the written consent of Agent
(which consent shall not be unreasonably delayed or withheld) if the effect
of such assignment or delegation shall entitle such Affiliate or other
Lender to claim compensation from Borrower pursuant to Section 2.6 and
Exhibit D; and
(ii) in every other case, such assignor Lender has furnished notice
to, but not obtained the consent of, Agent.
9.12 Entirety. THIS AGREEMENT, THE NOTE, AND THE OTHER LOAN DOCUMENTS
REFERRED TO HEREIN EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO,
AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF,
AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO
ORAL AGREEMENTS AMONG THE PARTIES HERETO. THE PROVISIONS OF THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS TO WHICH BORROWER IS A PARTY MAY BE AMENDED OR WAIVED
ONLY BY AN INSTRUMENT IN WRITING, SIGNED BY THE PARTIES HERETO.
9.13 Headings. Section headings are for convenience of reference only, and
shall in no way affect the interpretation of this Agreement.
9.14 Survival. All representations and warranties made by Borrower herein
shall survive delivery of the Note and the making of the Loan.
9.15 Amendments, Etc. No amendment or waiver of any provision of this
Agreement, the Notes, or any other Loan Document to which Borrower is a party,
nor any consent to any departure by Borrower therefrom, shall in any event be
effective unless the same shall be agreed or consented to by the Required
Lenders and Borrower, and each such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided,
that no amendment, waiver, or consent shall, unless in writing and signed by all
of Lenders and Borrower, do any of the following: (a) increase Commitments of
Lenders or subject Lenders to any additional obligations; (b) reduce the
principal of, or interest on, the Notes or any fees or other amounts payable to
Lenders (but not Agent) hereunder; (c) postpone any date fixed for any payment
of principal of, or interest on, the Notes or any fees or other amounts payable
to Agent or Lenders hereunder; (d) change the percentage of the Commitments or
of the aggregate unpaid principal amount of the Notes or the number of Lenders
which shall be required for Lenders or any of them to take any action under this
Agreement; (e) change any provision contained in this Section 9.15; or (f)
release any material portion of the Collateral, except in accordance with the
relevant Loan Document. Notwithstanding anything to the contrary contained in
this Section, no amendment, waiver, or consent shall be made with respect to
Section 8 without the prior written consent of Agent.
9.16 No Third Party Beneficiary. The parties do not intend the benefits of
this Agreement to inure to any third party, nor shall any Loan Document or any
course of conduct by any party hereto be construed to make or render Agent or
Lenders, or any of their officers, directors, agents, or employees liable (i) to
any materialman, supplier, contractor, subcontractor, purchaser or lessee of any
property owned by Borrower, or (ii) for debts or claims accruing to any such
Persons against Borrower.
9.17 WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, BORROWER HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL BY
JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,
TORT, OR OTHERWISE) ARISING OUT OF, OR RELATING TO ANY OF THE LOAN DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF LENDER IN THE
NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.
9.18 Multiple Counterparts. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
agreement, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
9.19 Confidentiality. Subject to Section 9.16, Agent and Lenders shall
hold all nonpublic information obtained pursuant to the requirements of this
Agreement in confidence in accordance with Agent's and Lenders' customary
procedures for handling confidential information of this nature, and in
accordance with safe and sound banking practices; provided, however, that Agent
or Lenders may make any disclosure thereof as is reasonably required by a bona
fide potential assignee or participant, or as required or requested by any
Governmental Authority or representative thereof, or pursuant to legal process,
or as may be necessary in order to properly enforce Agent's or Lenders' rights
and remedies following an Event of Default.
9.20 Arbitration. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES
HERETO, INCLUDING, BUT NOT LIMITED TO, THOSE ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY RELATED AGREEMENTS OR INSTRUMENTS, INCLUDING ANY CLAIM BASED ON
OR ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY BINDING ARBITRATION IN
ACCORDANCE WITH THE FEDERAL ARBITRATION ACT (OR IF NOT APPLICABLE, THE
APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR THE ARBITRATION
OF COMMERCIAL DISPUTES OF J.A.M.S. D/B/A ENDISPUTE, INC. ("J.A.M.S."), AND THE
"SPECIAL RULES" SET FORTH BELOW. IN THE EVENT OF ANY INCONSISTENCY, THE SPECIAL
RULES SHALL CONTROL. JUDGMENT UPON ANY ARBITRATION AWARD MAY BE ENTERED IN ANY
COURT HAVING JURISDICTION. ANY PARTY TO THIS AGREEMENT MAY BRING AN ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY
CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES, IN ANY COURT HAVING
JURISDICTION OVER SUCH ACTION.
(a) SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE CITY OF
BORROWER'S DOMICILE AT THE TIME OF THIS AGREEMENT'S EXECUTION, AND
ADMINISTERED BY J.A.M.S., WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS
UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN THE
AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING
OF CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO
AN ADDITIONAL 60 DAYS.
(b) RESERVATION OF RIGHTS. NOTHING IN THIS AGREEMENT SHALL BE DEEMED
TO (i) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS AGREEMENT; OR (ii)
BE A WAIVER BY LENDER OF THE PROTECTION AFFORDED TO IT BY 12 U.S.C. (S) 91
OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (iii) LIMIT THE RIGHT OF
LENDER HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SET-OFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES
SUCH AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF OR THE APPOINTMENT OF A
RECEIVER. LENDER MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING,
OR AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO
THIS AGREEMENT. AT AGENT'S OR LENDERS' OPTION, FORECLOSURE UNDER A DEED OF
TRUST OR MORTGAGE MAY BE ACCOMPLISHED BY ANY OF THE FOLLOWING: THE EXERCISE
OF A POWER OF SALE UNDER THE DEED OF TRUST OR MORTGAGE, OR BY JUDICIAL SALE
UNDER THE DEED OF TRUST OR MORTGAGE, OR BY JUDICIAL FORECLOSURE. NEITHER
THIS EXERCISE OF SELF HELP REMEDIES, NOR THE INSTITUTION OR MAINTENANCE OF
AN ACTION FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES SHALL,
CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN
ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM
OCCASIONING RESORT TO SUCH REMEDIES.
[Remainder of Page Intentionally Left Blank; Signature Pages to Follow]
SIGNATURE PAGES TO REVOLVING CREDIT AGREEMENT
DATED AS OF JULY 23, 1997, EXECUTED BY
▇▇▇▇ ▇. ▇▇▇▇▇▇, NATIONSBANK OF TEXAS, N.A.,
AS AGENT FOR THE LENDERS DEFINED THEREIN, AND THE LENDERS
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
day and year first above written.
Address for Notice:
Terrace Tower II
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
STATE OF NEW YORK (S)
(S)
COUNTY OF NEW YORK (S)
Before me, a Notary Public, on this day personally appeared ▇▇▇▇ ▇. ▇▇▇▇▇▇,
known to me to be the person whose name is subscribed to the foregoing
instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
Given under my hand and seal of office this ____ day of _______________,
1997.
--------------------------------------
Notary Public Signature
(PERSONALIZED SEAL)
SIGNATURE PAGES TO REVOLVING CREDIT AGREEMENT
DATED AS OF JULY 23, 1997, EXECUTED BY
▇▇▇▇ ▇. ▇▇▇▇▇▇, NATIONSBANK OF TEXAS, N.A.,
AS AGENT FOR THE LENDERS DEFINED THEREIN, AND THE LENDERS
Address for Notice: NATIONSBANK OF TEXAS, N.A., as Agent and a
Lender
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, III
▇.▇. ▇▇▇ ▇▇▇▇▇▇ ------------------------------------
Dallas, Texas 75283-1000 ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, III
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, III Senior Vice President
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Commitment: $80,000,000
Applicable Lending Office
for Prime Rate Advances:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Applicable Lending Office
for Eurodollar Advances:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
TORONTO DOMINION SECURITIES (USA), INC.
as Co-Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
Commitment: $0.00
Address for Notice: TORONTO DOMINION (TEXAS), INC.,
c/o The Toronoto-Dominion Bank as a Lender
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ Bondzierz By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ -------------------------------
Applicable Lending Office for ▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
Prime Rate Advances:
The Toronto-Dominion Bank
909 Fannin, Suite 1700 Commitment: $50,000,000.00
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Applicable Lending Office for
Eurodollar Advances:
The Toronto-Dominion Bank
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
EXHIBITS
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Eurodollar Requirements
Exhibit E - Closing List
Exhibit F - Initial Collateral
Exhibit G - Litigation
EXHIBIT A
FORM OF ASSIGNMENT AND ACCEPTANCE
---------------------------------
This Assignment and Acceptance (the "Assignment and Acceptance") is made as
of ______________________, 199______ (the "Effective Date"), between ___________
("Assignor") and _________ ("Assignee").
Reference is made to that certain Revolving Credit Agreement dated as of
July 23, 1997 (the "Credit Agreement") among ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Borrower"),
certain Lenders defined therein (the "Lenders"), NationsBank of Texas, N.A., a
national banking association, as Agent for the Lenders, and Toronto Dominion
Securities (USA), Inc., as Co-Agent for the Lenders. This Assignment and
Acceptance is executed and delivered pursuant to, and as contemplated in, the
Credit Agreement. Capitalized terms used but not defined herein shall have the
meanings assigned thereto in the Credit Agreement.
Assignor and Assignee hereby covenant and agree as follows:
1. Assignor hereby sells and assigns to Assignee, and Assignee hereby
purchases and assumes from Assignor, $ ___________ of Assignor's Commitment and
Principal Debt, representing a Pro Rata Part of the Commitments and Principal
Debt of __ % as of the Effective Date. The foregoing interest for all events
and circumstances shall be deemed such Assignee's Pro Rata Part (in addition to
any other Pro Rata Part of Assignee, if any) in the Commitments, the Principal
Debt, the Loan Documents, and all payments made to or received from Borrower
pursuant to the Loan Documents and is subject to the terms and conditions
provided in the Loan Documents.
2. Assignor (a) hereby represents and warrants to Assignee that
Assignor is the legal and beneficial owner of the Pro Rata Part being assigned
by it hereunder and such interest is free and clear of any adverse claim, and
(b) hereby represents and warrants that as of the date hereof the Pro Rata Part
in the Commitments and the Principal Debt being assigned hereunder is ___ %
without giving effect to assignments that are not yet effective.
3. Assignee hereby confirms and acknowledges that, except as
specifically set forth herein, Assignor: (a) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents,
or the execution, legality, validity, enforceability, genuineness, sufficiency,
or value of the Loan Documents, or any other instrument or document furnished
pursuant thereto; (b) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or any other
person or entity which is a party to any of the Loan Documents (collectively,
"Other Party"); and (c) makes no representation or warranty and assumes no
responsibility with respect to the performance or observance by Borrower or any
Other Party of any of its obligations under any of the Loan Documents or any
other instrument or document furnished pursuant thereto.
4. Assignee hereby: (a) confirms that it has received a copy of the
Loan Documents, together with such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; and (b) agrees that it will, independently and
without reliance upon Assignor or any other counterparty and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents.
5. Assignee hereby: (a) appoints and authorizes Agent under the Loan
Documents to take such action as agent on its behalf and to exercise such powers
under the Loan Documents as are delegated to Agent by the terms of the Loan
Documents; and (b) agrees with Assignor for the benefit of Agent and Borrower
that it will perform all of the obligations which by the terms of the Loan
Documents are required to be performed by it as a counterparty (including,
without limitation, the obligation to make payments pursuant to the Loan
Documents) and that it shall be liable directly to Assignor, Agent, Borrower
and, as provided in the Credit Agreement, to each Lender for the performance of
such obligations.
6. If Assignee is organized under the laws of a jurisdiction outside
the United States, it hereby represents and agrees that it has delivered or will
within three (3) days after the date of the execution of this Agreement deliver
to Assignor and the Administrative Agent completed and signed copies of any
forms that may be required by the United States Internal Revenue Service in
order to certify Assignee's exemption from United States withholding taxes with
respect to any payment or distributions made or to be made to Assignee with
respect to the Loan Documents.
7. As of the Effective Date, (a) Assignee shall be a party to the Loan
Documents and, to the extent provided in this Assignment and Acceptance, have
the rights and obligations of a counterparty thereunder, and (b) Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations in the Loan Documents with respect to the
Pro Rata Part being assigned hereunder.
8. Assignee hereby represents and warrants as of the Effective Date:
(a) Assignee has all necessary corporate power and authority to purchase and own
the interest being assigned to it hereunder, and has all necessary corporate
power and authority to perform all its obligations with respect to this
Assignment and Acceptance; (b) the execution and delivery of this Assignment and
Acceptance and all other instruments and documents executed in connection
herewith have been duly authorized by all requisite corporate action of
Assignee; and (c) no approval, authorization, order, license, or consent of, or
registration or filing with, any Governmental Authority or other person is
required in connection with this Assignment and Acceptance.
9. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Texas, without giving effect to the
conflict of laws principles thereof.
10. This Agreement may be executed in two or more counterparts each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.
11. Assignee's address for notices and payments under the Agreement
and this Assignment and Acceptance are set forth in Schedule 1 attached hereto
and made a part hereof. Assignee may by notice in accordance with the Credit
Agreement to Assignor, the Administrative Agent and Borrower
change the address or telex number or facsimile number at which notices,
communications and payments are to be given to it.
ASSIGNOR:
-----------------------------------------
By:
--------------------------------------
Title:
-----------------------------------
ASSIGNEE:
-----------------------------------------
By:
--------------------------------------
Title:
-----------------------------------
ACCEPTED BY AGENT
THIS _____ DAY OF ___________________
AGENT:
NATIONSBANK OF TEXAS, N.A.
By:
---------------------------------
Name:
----------------------------
Title:
---------------------------
SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE
ADDRESS FOR NOTICES AND ACCOUNTS FOR PAYMENTS
Address:
------------------------
------------------------
------------------------
Account for Payments:
Account No.:
------------------------
Attention:
------------------------
Reference:
------------------------
Depositary:
------------------------
------------------------
------------------------
Applicable Lending
Office - Base Rate
Advances:
------------------------
------------------------
------------------------
Applicable Lending
Office - Eurodollar
Advances:
------------------------
------------------------
------------------------
EXHIBIT B
FORM OF REVOLVING CREDIT NOTE
-----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
$
------------- Dallas, Texas July 31, 1997
1. FOR VALUE RECEIVED, ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Maker"), hereby
unconditionally promises to pay to the order of ______________________ ("Payee")
at the address reflected on the signature page of the Loan Agreement (as defined
below), the sum of __________________________________________________ AND NO/100
Dollars ($_______________________________________________) (or, if less, so much
thereof as may be advanced and is outstanding), in lawful money of the United
States of America.
2. This Revolving Credit Note (this "Note") has been executed and
delivered pursuant to the Revolving Credit Agreement (as renewed, extended,
amended, or restated, the "Loan Agreement") dated as of the date hereof, between
Maker, Payee, certain other "Lenders," and NationsBank of Texas, N.A. as "Agent"
for Lenders, and is the "Note" referred to therein. Capitalized terms not
defined herein shall have the meaning assigned to those terms in the Loan
Agreement. The holder of this Note is entitled to the benefits provided in the
Loan Agreement. Reference is hereby made to the Loan Agreement for a statement
of (i) the obligation of Payee to advance funds hereunder, (ii) the prepayment
rights and obligations of Maker and (iii) the events on which the maturity of
this Note may be accelerated.
3. The unpaid principal amount of, and accrued unpaid interest on,
this Note is payable in accordance with the Loan Agreement, but not later than
the Termination Date.
4. The unpaid principal balance advanced and outstanding hereunder
shall bear interest from the date of advance until maturity at the rate per
annum provided in the Loan Agreement. The interest rate specified in this
section is subject to adjustment under the circumstances described in the Loan
Agreement. Interest shall be computed in the manner provided in the Loan
Agreement.
5. Notwithstanding any provision contained in this Note or any other
document executed or delivered in connection with this Note or in connection
with the Loan Agreement, Payee shall never be deemed to have contracted for or
be entitled to receive, collect or apply as interest on this Note, any amount in
excess of the maximum rate of interest permitted to be charged by applicable
law, and, if Payee ever receives, collects or applies as interest any such
excess, then the amount that would be excessive interest shall be applied to
reduce the unpaid principal balance of this Note, and, if the principal balance
of this Note is paid in full by that application, then any remaining excess
shall promptly be paid to Maker. In determining whether the interest paid or
payable under any specific contingency exceeds the highest lawful rate, Maker
and Payee shall, to the maximum extent permitted under applicable law, (i)
characterize any non-principal payment (other than payments expressly designated
as interest payments hereunder) as an expense or fee rather than as interest,
(ii) exclude voluntary prepayments and the effect thereof, and (iii) spread the
total amount of interest throughout the entire contemplated term of this Note so
that the interest rate is uniform throughout that term.
6. If the principal of, or any installment of interest on, this Note
becomes due and payable on a day other than a Business Day, then the maturity
thereof shall be extended to the next succeeding Business Day. If this Note, or
any installment or payment due hereunder, is not paid when due, whether at
maturity or
by acceleration, or if it is collected through a bankruptcy, probate
or other court, whether before or after maturity, then Maker shall pay all costs
of collection, including, but not limited to, attorney's fees incurred by the
holder of this Note. All past due principal of, and to the extent permitted by
applicable law, interest on this Note shall bear interest until paid at the rate
provided in the Loan Agreement.
7. Maker and all sureties, endorsers, guarantors and other parties
ever liable for payment of any sums payable pursuant to the terms of this Note,
jointly and severally waive demand, presentment for payment, protest, notice of
protest, notice of acceleration, notice of intent to accelerate, diligence in
collection, the bringing of any suit against any party and any notice of or
defense on account of any extensions, renewals, partial payments or changes in
any manner of or in this Note or in any of its terms, provisions and covenants,
or any releases or substitutions of any security, or any delay, indulgence or
other act of any trustee or any holder hereof, whether before or after maturity.
8. This Note is being executed and delivered, and is intended to be
performed in the State of Texas. Except to the extent that the laws of the
United States may apply to the terms hereof, the substantive laws of the State
of Texas shall govern the validity, construction, enforcement and interpretation
of this Note.
MAKER:
----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
EXHIBIT C
NOTICE OF BORROWING
-------------------
1. Submission Pursuant To Credit Agreement. This Notice of Borrowing
is executed and delivered by ▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Borrower"), to NationsBank of
Texas, N.A., as Agent (the "Agent"), pursuant to Section 2.3 of the Revolving
Credit Agreement (the "Agreement") dated as of July 23, 1997, between Borrower,
certain Lenders defined therein (the "Lenders"), NationsBank of Texas, N.A., a
national banking association, as Agent for the Lenders, and Toronto Dominion
Securities (USA), Inc., as Co-Agent for the Lenders. Any capitalized terms used
and not defined herein shall have the meanings assigned to them in the
Agreement.
2. Request For Advance. Borrower hereby requests that Lenders make an
Advance to Borrower pursuant to the Agreement as follows:
A. Prime Rate Borrowing.
(i) Amount of Prime Rate Borrowing: .
--------------
[ ] Borrowing
[ ] Rollover/Conversion
(ii) Date of Borrowing or Rollover/Conversion
of Existing Borrowing:
--------------
B. Eurodollar Borrowing.
(i) Amount of Eurodollar Borrowing: .
--------------
[ ] Borrowing
[ ] Rollover/Conversion
(ii) Date of Borrowing or Rollover/Conversion
of Existing Borrowing:
--------------
(iii) Interest Period:
--------------
day/months (one, two, three, four, or six months).
3. Representations, Warranties and Certifications. Borrower hereby
represents, warrants, and certifies to Agent and Lenders that, as of the date of
the Advance requested herein:
(a) there exists no Potential Default or Event of Default;
(b) the Borrower has performed and complied with all agreements and
conditions contained in the Agreement that are required to be
performed or complied with by the Borrower; and
(c) the representations and warranties of a continuing nature
contained in the Agreement and each of the other Loan Documents
are true and correct in all material respects (except to the
extent that they speak to a specific date or are based on facts
which have changed by transactions expressly contemplated or
permitted by the Credit Agreement), with the same force and effect
as though made on and as of the date of the Advance.
4. Proceeds of Borrowing. Agent is authorized to deposit the proceeds
of the Advance requested hereby, other than an Advance constituting a rollover
or conversion of an existing Advance, to: ____________________________________.
5. Execution Authorized. This Notice of Borrowing is executed on
________, 19__. The undersigned hereby certifies the accuracy of the foregoing.
--------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
EXHIBIT D
EURODOLLAR ADVANCES
-------------------
(a) Inadequacy of Eurodollar Pricing. If with respect to an Interest
Period for any Eurodollar Advance:
(i) Agent determines that the basis for determining the Eurodollar
Rate is not available; or
(ii) a Lender reasonably determines that the Eurodollar Rate as
determined by Agent will not adequately and fairly reflect the cost to such
Lender of maintaining or funding the Eurodollar Advance for such Interest
Period;
then (A) in the case of (i), Agent shall forthwith give notice thereof to
Borrower and Lenders of that determination (which is presumed to be correct in
the absence of manifest error), all Advances shall be Prime Rate Advances, and
until Agent notifies Borrower and Lenders that such circumstances no longer
exist, Lenders' commitments under this Agreement to make, or convert to,
Eurodollar Advances shall be suspended, and (B) in the case of (ii), such Lender
shall forthwith give notice thereof to Agent and Borrower, the obligation of
such Lender to make Eurodollar Advances shall be suspended, Borrower shall, at
its option, either (I) repay in full the then-outstanding principal amount of
all Eurodollar Advances, together with accrued interest thereon on the last day
of the then current Interest Period applicable to such Eurodollar Advances, or
(II) convert such Eurodollar Advances to Prime Rate Advances in accordance with
Section 2.3(c) of this Agreement on the last day of the then-current Interest
Period applicable to each such Eurodollar Advance, and until such Lender
notifies Agent and Borrower that such circumstances no longer exist, such
Lender's commitment under this Agreement to make, or convert to, Eurodollar
Advances shall be suspended.
(b) Illegality of Eurodollar Advances. If, after the date of this
Agreement, the adoption of any applicable law, rule, or regulation, or any
change therein, 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 Agent or any Lender
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 Lender to make, maintain, or fund its Eurodollar Advances,
then such Lender shall forthwith give notice thereof to Agent and Borrower.
Before giving any notice pursuant to this subsection, such Lender shall
designate a different Eurodollar lending office if such designation will avoid
the need for giving such notice and will not be otherwise disadvantageous to any
non-trivial extent to such Lender (as determined in good faith by such Lender).
Upon receipt of such notice, Borrower shall either (i) repay in full the then-
outstanding principal amount of any of such Lender's Eurodollar Advances,
together with accrued interest thereon, or (ii) convert such Lender's Eurodollar
Advances to Prime Rate Advances, on either (A) the last day of the then current
Interest Period applicable to such Eurodollar Advance, if such Lender may
lawfully continue to maintain and fund such Eurodollar Advance to such day, or
(B) immediately, if such Lender may not lawfully continue to fund and maintain
such Eurodollar Advance to such day.
(c) Increased Costs for Eurodollar Advances. If, after the date hereof,
any Governmental Authority, central bank, or other comparable authority, shall
at any time impose, modify, or deem applicable any reserve (including, without
limitation, any reserve imposed by the Board of Governors of the Federal Reserve
System, and any reserve requirement included in the Eurodollar Reserve
Requirement), special deposit or similar requirement against assets of, deposits
with, or for the account of, or credit extended by, any Lender, or shall impose
on any Lender (or its Applicable Lending Office) or the interbank eurodollar
market any other condition affecting its Eurodollar Advances, the Notes or such
Lender's obligation to make Eurodollar Advances; and the result of any of the
foregoing is to increase the cost to such Lender of making or maintaining its
Eurodollar Advances, or to reduce the amount of any sum received or receivable
by such Lender under this Agreement, or under such Lender's Note, by an amount
deemed by such Lender to be material, then, within five (5) days after demand by
such Lender, Borrower shall pay to Agent, for the account of such Lender, such
additional amount or amounts as will compensate such Lender for such increased
reserve, cost or reduction. Such Lender will (i) notify Agent and Borrower of
any event occurring after the date of this Agreement which will entitle such
Lender to compensation pursuant to this Section, as promptly as practicable (but
in any event within 120 days) after such Lender obtains actual knowledge of such
event, and Borrower shall not be liable for any such increased costs that accrue
between the date such notification is required to be given and the date it was
actually given, and (ii) use good faith and reasonable efforts to designate an
Applicable Lending Office for Eurodollar Advances of such Lender, if such
designation will avoid the need for, or reduce the amount of, such compensation,
and will not, in the sole opinion of such Lender, be disadvantageous to such
Lender (provided that such Lender shall have no obligation to so designate a
lending office located in the United States of America). A certificate of such
Lender claiming compensation under this Section and setting forth in reasonable
detail the calculation of the additional amount or amounts to be paid to it
hereunder shall be presumed to be correct in the absence of manifest error. If
a Lender demands compensation under this Section, then Borrower may at any time,
upon at least five (5) Business Days' prior notice to such Lender and Agent,
either (i) repay in full the then outstanding Eurodollar Advances to such
Lender, together with accrued interest thereon to the date of prepayment, or
(ii) convert such Eurodollar Advances to Prime Rate Advances in accordance with
the provisions of this Agreement; provided, however, that Borrower shall be
liable for any Funding Loss arising pursuant to such actions.
(d) Effect on Prime Rate Advances. If notice has been given pursuant to
paragraph (a) or (b) above, requiring the Eurodollar Advances to be repaid or
converted, then unless and until Agent notifies Borrower that the circumstances
giving rise to such repayment no longer apply, all Advances shall be Prime Rate
Advances. If Agent notifies Borrower that the circumstances giving rise to such
repayment no longer apply, Borrower may thereafter select Advances to be
Eurodollar Advances in accordance with Section 2.3(c) of this Agreement.
(e) Funding Losses. Borrower shall indemnify Agent and each Lender against
any loss or reasonable expense (such loss or expense is referred to herein as a
"Funding Loss," such term including, but not limited to, any loss or reasonable
expense sustained or incurred or to be sustained or incurred in liquidating or
reemploying deposits from third parties acquired to effect or maintain such
Advance or any part thereof as a Eurodollar Advance) which Agent or any Lender
may sustain or incur as a consequence of (i) any failure by Borrower to fulfill
on the date of any Advance hereunder the applicable conditions set forth in
Section 4, (ii) any failure by Borrower to borrow hereunder or to convert
Advances hereunder after a Notice of Borrowing has been given, (iii) any
payment, prepayment, or conversion of a Eurodollar Advance required or permitted
by any other provisions of this Agreement, including, without limitation,
payments made due to the acceleration of the maturity of Advances pursuant to
Section 7.2, or otherwise made on a date other than the last day of the
applicable Interest Period other than pursuant to Section (a)(ii) of this
Exhibit, (iv) any default in the payment or prepayment of the principal amount
of any Advance or any part thereof or interest accrued thereon, as and when due
and payable (at the due date thereof, by notice of prepayment or otherwise), or
(v) the occurrence of an Event of Default. The term "Funding Loss" includes,
without limitation, an amount equal to the excess, if any, as determined by
Agent or any Lender of (A) its cost of obtaining the funds for the Advance being
paid, prepaid, or
converted or not borrowed or converted (based on the Adjusted Eurodollar Rate
applicable thereto) for the period from the date of such payment, prepayment, or
conversion or failure to borrow or convert to the last day of the Interest
Period for such Advance (or, in the case of a failure to borrow or convert, the
Interest Period for the Advance which would have commenced on the date of such
failure to borrow or convert) over (B) the amount of interest (as estimated by
Agent or such Lender) that would be realized by Agent or such Lender in
reemploying the funds so paid, prepaid, or converted or not borrowed or
converted for such period or Interest Period, as the case may be. A certificate
of Agent or such Lender setting forth any amount or amounts which Agent or such
Lender is entitled to receive pursuant to this paragraph (e), together with a
description in reasonable detail of the manner in which such amounts have been
calculated, shall be delivered to Borrower and shall be presumed to be correct
in the absence of manifest error. Borrower shall pay to Agent, for itself or for
the account of any such Lender, the amount shown as due on any certificate
within five (5) days after its receipt of the same. Notwithstanding the
foregoing, in no event shall Lender be permitted to receive any compensation
hereunder constituting interest in excess of the Maximum Rate.
EXHIBIT E
CLOSING CONDITIONS
------------------
Unless otherwise specified, all dated as of
July 23, 1997, or a date (a "Current Date")
within 30 days before the Closing Date.
H&B [[1.] REVOLVING CREDIT AGREEMENT (the "Loan Agreement") dated as of July
23, 1997, between ▇▇▇▇ ▇. ▇▇▇▇▇▇, ("Borrower"), certain Lenders
defined therein (the "Lenders"), NATIONSBANK OF TEXAS, N.A., as
Agent for the Lenders, and TORONTO DOMINION SECURITIES (USA), INC.,
as Co-Agent for the Lenders -- all the terms of which or
incorporated in which have the same meanings when used in this
schedule -- to which must be attached:
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Eurodollar Requirements
Exhibit E - Closing List
Exhibit F - Initial Collateral
Exhibit G - Litigation
H&B 2. REVOLVING CREDIT NOTE in the total stated principal amount of
$80,000,000.00, executed by Borrower, payable to NationsBank of
Texas, N.A., in substantially the form of Exhibit B to the Loan
Agreement.
H&B 3. REVOLVING CREDIT NOTE in the total stated principal amount of
$50,000,000.00, executed by Borrower, payable to Toronto Dominion
(Texas), Inc., in substantially the form of Exhibit B to the Loan
Agreement.
H&B [4.] PLEDGE AGREEMENT executed by Borrower and Agent.
H&B 5. RULE 144 RIDER executed by Borrower, substantially in the form of
Rider 1 to the Pledge Agreement.
Borrower 6. STOCK CERTIFICATES: 11,500,000 shares of Tele-Communications, Inc.
Series B TCI Group Common Stock in the name of "▇▇▇▇ ▇. ▇▇▇▇▇▇,"
Cusip Number ▇▇▇▇▇▇▇▇▇; and 3,058,358 shares of Tele-
Communications, Inc. Series B Liberty Media Group Common Stock in
the name of "▇▇▇▇ ▇. ▇▇▇▇▇▇," Cusip Number ▇▇▇▇▇▇▇▇▇, as evidenced
by the following:
-------------------------------------------------------------------------------
Issuer Certificate Number Number of Shares
-------------------------------------------------------------------------------
Tele-Communications, Inc. TB6384 11,500,000.00
Series B TCI Group
--------------------------------------------------------------------------------
--------------------------------------
[[ ] indicates items not complete at time of this draft of this
schedule, together with names of individuals of parties or counsel
with responsibility for each.
--------------------------------------------------------------------------------
Issuer Certificate Number Number of Shares
--------------------------------------------------------------------------------
Tele-Communications, Inc. LB0649 416,666
Series B Liberty Media
Group
-------------------------------------------------------------------------------
Tele-Communications, Inc. LB0651 2,251,026
Series B Liberty Media
Group
--------------------------------------------------------------------------------
Tele-Communications, Inc. LB0652 416,666
Series B Liberty Media
Group
--------------------------------------------------------------------------------
H&B [6.] STOCK POWERS, executed in blank, with signatures guaranteed.
H&B 7. UCC-1 FINANCING STATEMENTS executed by Borrower in form
suitable for filing with the Office of the Secretary of State
for each of Colorado and Texas.
H&B 8. PURPOSE STATEMENT on Form U-1.
Borrower's
Counsel 9. OPINION OF COUNSEL for Borrower, dated as of July 23, 1997, in
a form satisfactory to Agent.
Borrower 10. FINANCIAL STATEMENTS for Borrower.
H&B 11. NOTICE OF NO ORAL AGREEMENTS pursuant to Section 26.02 of
Texas Uniform Commercial Code.
12. NOTICE OF BORROWING, dated as of July 23, 1997, executed by
Borrower.
13. Such other documents and items as Lender may reasonably
request.
EXHIBIT F
INITIAL COLLATERAL
------------------
11,500,000 shares of Tele-Communications, Inc. Series B TCI Group Common
Stock in the name of "▇▇▇▇ ▇. ▇▇▇▇▇▇," Cusip Number ▇▇▇▇▇▇▇▇▇; and
3,058,358 Shares of Tele-Communications, Inc. Series B Liberty Media Group
Common Stock in the name of "▇▇▇▇ ▇. ▇▇▇▇▇▇," Cusip Number ▇▇▇▇▇▇▇▇▇, as
evidenced by the following:
-------------------------------------------------------------------------------
Issuer/Series Certificate Number Number of Shares
-------------------------------------------------------------------------------
Tele-Communications, Inc. TB6384 11,500,000.00
Series B TCI Group
-------------------------------------------------------------------------------
Tele-Communications, Inc. LB0649 416,666
Series B Liberty Media Group
-------------------------------------------------------------------------------
Tele-Communications, Inc. LB0652 2,251,026
Series B Liberty Media Group
-------------------------------------------------------------------------------
Tele-Communications, Inc. LB0651 416,666
Series B Liberty Media Group
------------------------------------------------------------------------------
SCHEDULE G
Part I
------
Below is a list of the litigation matters in which ▇▇▇▇ ▇. ▇▇▇▇▇▇ has been named
a party. Except as noted in the description of these matters in Part II of this
Schedule, liability is believed to be deminimis, if any.
1. E.L. Greenfield, as custodian for ▇.▇. ▇▇▇▇▇▇▇▇▇▇, Plaintiff, vs. Tele-
Communications, Inc., ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇'▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇, United Artists Communications, Inc., ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇, G. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, United Cable Television
Corporation, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Defendants.
Summary: Action to enjoin/rescind merger of United Artists and United
Cable Television.
2. ▇▇▇▇▇ ▇▇▇▇▇, et al. vs. ▇▇▇▇▇▇ Broadcasting System, Inc., R.E. ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, W. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, Time ▇▇▇▇▇▇, Inc., and Tele-Communications, Inc.
Summary: See Paragraph 1 in Part II.
3. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, and ▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇▇,
vs. Tele-Communications, Inc., ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, in Their capacity as Co-Personal Representatives of the Estate of
▇▇▇ ▇▇▇▇▇▇▇ (Tele-Communications, Inc.)
Summary: See Paragraph 4 in Part II.
4. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇.,
et al. vs. Tele-Communications, Inc., ▇▇▇▇ ▇▇▇▇▇▇, and ▇▇ ▇▇▇▇▇▇▇▇
(District Cablevision Limited Partnership)
Summary: Class action; racial discrimination; dismissed without prejudice
in 1995.
5. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ vs. QVC, Inc., ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and CBS, Inc.
[Liberty Media Corp.]
Summary: See Paragraph 2 in Part II.
6. In re Liberty Media Corporation Shareholder Litigation (original complaint,
as amended, named as defendants: ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
▇.▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Liberty Media Corporation na and
Tele-Communications, Inc., ▇▇▇▇▇ ▇▇▇▇▇, and ▇▇▇▇▇ ▇▇▇▇▇▇)
Summary: See Paragraph 3 in Part II.
7. Glendora vs. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, Tele-Communications, Inc., ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇'▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
Margarelli, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, and UA-Columbia
Cablevision of Westchester, Inc. d/b/a TCI Cable of Westchester [UA-
Columbia Cablevision of Westchester, Inc.]
Summary: Action for an injunction on removing a program from broadcast; in
preliminary stages of third complaint; first two actions dismissed.
Part II
-------
Set forth below is the description of certain of the matters listed in Part I of
this Schedule, as disclosed in the public filings of Tele-Communications, Inc.
1. ▇▇▇▇▇▇ Broadcasting Systems, Inc. Shareholder Litigation. Following
--------------------------------------------------------
the announcement of the proposed merger (the "TBS-Time Warner Merger") between
▇▇▇▇▇▇ Broadcasting Systems, Inc. ("TBS") and Time Warner, Inc. ("Time Warner")
several purported class action lawsuits were filed by TBS shareholders in ▇▇▇▇▇▇
County Superior Court, Georgia. On November 1, 1995, plaintiffs in thirteen of
the cases filed a second amended class action Complaint in what will be a
consolidated action styled ▇▇▇▇▇ ▇. TBS, Inc. C.A. No. B-41500. The defendants
------------------
include, among others, Tele-Communications, Inc., ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇ ▇▇▇▇▇▇. The claims and defendants in the actions other than the ▇▇▇▇▇
-----
action are substantially the same as set forth in the second amended complaint
in the ▇▇▇▇▇ action. Plaintiffs allege in the second amended complaint in the
-----
▇▇▇▇▇ action that defendants have injured the public stockholders of TBS in
-----
conjunction with the TBS-Time Warner Merger proposal by (a) misrepresenting the
extent to which defendants Time Warner, TCI, ▇▇▇▇ ▇▇▇▇▇▇ and R.E. ▇▇▇▇▇▇
("▇▇▇▇▇▇") have acted for their own benefit and not for the benefit of TBS or
its stockholders, (b) failing to adequately disclose the full nature and value
of special considerations granted to TCI and ▇▇▇▇▇▇ in connection with the TBS-
Time Warner Merger proposal, (c) failing to engage in arms' length bargaining or
give any consideration to maximizing TBS stockholder value, (d) proposing to
provide the public holders of TBS stock with unfair consideration in the TBS-
Time Warner Merger, and (e) seeking to entrench certain of the TBS officers and
directors. Plaintiffs in the ▇▇▇▇▇ action seek to enjoin the consummation of
-----
the TBS-Time Warner Merger, enjoin the transfer of any assets to TCI in
connection with the TBS-Time Warner Merger, or to rescind the TBS-Time Warner
Merger or transfer of assets if such acts are consummated. Plaintiffs also seek
unspecified compensatory and punitive damages. On December 20, 1996, the
Georgia State Court dismissed the plaintiffs third amended complaint in the
▇▇▇▇▇ action. Plaintiffs have stated their intention to appeal the dismissal
-----
order and filed a fourth amended
complaint on January 16, 1997. Discovery has not commenced in any of the
actions. Based upon the facts available, management believes that, although no
assurance can be given as to the outcome of these actions, the ultimate
disposition should not have a material adverse effect upon the financial
condition of the Company.
2. QVC Shareholders Litigation. In July 1994, eight putative class action
---------------------------
lawsuits were filed by certain shareholders of the company in the Delaware Court
of Chancery on behalf of unspecified classes of holders of QVC common stock. On
August 3, 1994, these actions were consolidated under the caption In re QVC
---------
Shareholders Litigation, Consolidated Civil Action No. 13590 (Court of Chancery,
-----------------------
New Castle County, State of Delaware) (the "Consolidated Action"). The
defendants named in the designated complaint in the Consolidated Action included
QVC and its then directors (▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, J. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇). In their designated complaint in the Consolidated Action,
plaintiffs alleged, among other things, that the QVC directors breached their
fiduciary duties by failing to take all possible steps to seek out and encourage
the best offer for QVC following the announcement by Comcast of a merger
proposal to acquire QVC. Plaintiffs sought, among other things, an injunction
ordering the defendants to auction QVC and an award of unspecified damages to
the members of the plaintiff class. On July 22, 1994, Comcast and Liberty made
a merger proposal to QVC in order to acquire the remaining shares of QVC common
stock that Comcast and Liberty collectively did not already own.
During early August 1994, counsel for the plaintiffs in the Consolidated
Action advised counsel for Liberty that they were preparing to amend the
designated complaint to name Comcast and Liberty as defendants. On August 3-4,
1994, plaintiffs' counsel negotiated with counsel for Liberty with respect to a
proposed increase in the consideration to be paid to QVC's public shareholders
as well as the accelerated payment of such consideration, as bases for the
possible settlement of the Consolidated Action. On August 5, plaintiffs,
defendants, Comcast and Liberty executed a memorandum of understanding which
contemplated the settlement and dismissal with prejudice of the Consolidated
Action. On August 4, 1994, Comcast, Liberty, QVC Programming Holdings, Inc. and
the Company executed a merger agreement which, among other things, reflected the
parties' agreement to the terms and transactions contemplated by the memorandum
of understanding. On August 19, 1994, as contemplated by the memorandum of
understanding, plaintiffs filed a consolidated amended class action complaint
with the Delaware Court of Chancery against QVC, the company's directors,
Comcast and Liberty.
The settlement of the Consolidated Action was approved by the Delaware
Court of Chancery on February 5, 1997 and will result in the dismissal with
prejudice of the Consolidated Action, and a complete release of all claims,
known or unknown, arising out of or related to the acts, transactions or
occurrences that are alleged in the Consolidated Action. Defendants in the
Consolidated Action have entered into the memorandum of understanding and have
entered into the stipulation of settlement for the Consolidated Action solely
because the proposed settlement would eliminate the distraction, burden and
expense of the litigation. This represents the final resolution of this matter,
and accordingly, it will not be reported in future filings.
3. In re Liberty Media Corporation Shareholder Litigation, Cons. C.A. No.
------------------------------------------------------
13168 (Del. Ch.). In October 1993, after the announcement that Liberty would
recombine with TCI through
the mergers of TCIC and Liberty with subsidiaries of a newly formed holding
company, seven putative class action lawsuits were filed by Liberty stockholders
in the Court of Chancery of the State of Delaware (the "Delaware Chancery
Court") on behalf of unspecified classes of the holders of Liberty common stock
(other than defendants). The original defendants included certain directors of
Liberty (▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇), Liberty and TCI. These actions were consolidated by
the Delaware Chancery Court on October 27, 1993 under the caption In re Liberty
-------------
Media Corporation Shareholder Litigation, Cons. C.A. No. 13168 (the "Liberty
----------------------------------------
Stockholder Action"). On December 21, 1994, plaintiffs were permitted by the
Delaware Chancery Court to file a second consolidated amended complaint against
the defendants named in the pending complaint and Liberty directors ▇▇▇▇▇ ▇▇▇▇▇
and ▇▇▇▇▇ ▇▇▇▇▇▇. The pending complaint is on behalf of a putative class
consisting of all holders of Liberty common stock (except the defendants and
their affiliates) from and after October 7, 1993 through the date of the
TCI/Liberty Combination. Plaintiffs alleged that the Liberty stockholders
received inadequate consideration in the TCI/Liberty Combination, that the
defendants impeded the ability of third parties to seek to acquire Liberty, and
that the defendants failed to conduct an auction or market check following the
announcement of the proposed TCI/Liberty Combination. Plaintiffs sought to
rescind the TCI/Liberty Combination, to require defendants to take all
appropriate steps to enhance Liberty's value as an acquisition candidate, to
account to the plaintiff class for all profits obtained by defendants, and to
require defendants to pay unspecified damages to the plaintiff class. In
February 1997, the parties to the action reached an agreement, in principle, to
settle the litigation in exchange for the payment by TCI of (i) $44 million (in
TCI Group stock or cash) to the Liberty stockholders at the time of the
TCI/Liberty Combination and (ii) fees for plaintiffs' counsel. Formal settlement
papers are expected to be filed with the Delaware Chancery Court by April 30,
1997. This represents the final resolution of this matter, and accordingly, it
will not be reported in future filings.
4. ▇▇▇▇▇ ▇▇▇▇▇▇, et al. v. Tele-Communications, Inc., et al. On February
---------------------------------------------------------
24, 1997, ▇▇▇▇▇ ▇▇▇▇▇▇, et al. filed suit in District Court for Arapahoe County,
Colorado, Case No. 97-CV421, against Tele-Communications, Inc. ("TCI") and
certain officers of TCI. Plaintiffs filed this action under the Colorado
Securities Act and Colorado common law on behalf of all persons who purchased
TCI securities from January 10, 1996 through October 24, 1996 ("the class
period"). Plaintiffs claim, in part, that the defendants made false and
misleading statements during the class period concerning TCI's revenue and cash
flow growth, subscriber growth, and expansion and diversification into a multi-
business platform; and that TCI failed to disclose the performance of its
various operations. Plaintiffs claim further, in part, that TCI's cash flow
growth was weak and below levels necessary to fund a multi-business
diversification program and that TCI was competitively disadvantaged and would
likely be threatened by adverse conditions impacting its business. Plaintiffs
are seeking nationwide class certification and claim that the amount in
controversy is less than $75,000 per named plaintiff, exclusive of interest and
costs. TCI intends to defend such claims vigorously. Based upon the facts
available, management believes that, although no assurances can be given as to
the outcome of this action, the ultimate disposition should not have a material
adverse effect upon the financial condition of the Company.