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EXHIBIT 10.02
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CREDIT AGREEMENT
AMONG
FLEXTRONICS INTERNATIONAL USA, INC.,
AND
THE LENDERS NAMED HEREIN
AND
ABN AMRO BANK N.V.,
AS AGENT FOR LENDERS
AND
BANKBOSTON, N.A.
AS DOCUMENTATION AGENT
AND
BANK OF AMERICA, N.A.
BANQUE NATIONALE DE PARIS,
THE BANK OF NOVA SCOTIA
AND
CITICORP USA, INC.
AS CO-AGENTS
OCTOBER 27, 1999
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TABLE OF CONTENTS
PAGE
SECTION I. INTERPRETATION............................................................1
1.01. Definitions..................................................................1
1.02. GAAP........................................................................14
1.03. Headings....................................................................14
1.04. Plural Terms................................................................14
1.05. Governing Law...............................................................14
1.06. English Language............................................................14
1.07. Construction................................................................14
1.08. Entire Agreement............................................................14
1.09. Calculation of Interest and Fees............................................14
1.10. References..................................................................14
1.11. Other Interpretive Provisions...............................................15
SECTION II. CREDIT FACILITIES........................................................15
2.01. Loans.......................................................................15
2.02. LIBOR Interest Periods......................................................18
2.03. Amount Limitations, Commitment Reductions, Etc..............................19
2.04. Fees........................................................................19
2.05. Prepayments.................................................................19
2.06. Other Payment Terms.........................................................20
2.07. Loan Accounts; Notes........................................................21
2.08. Loan Funding................................................................22
2.09. Pro Rata Treatment..........................................................22
2.10. Change of Circumstances.....................................................23
2.11. Taxes on Payments...........................................................25
2.12. Funding Loss Indemnification................................................26
2.13. Security....................................................................26
2.14. Replacement of Lenders......................................................27
SECTION III. CONDITIONS PRECEDENT.....................................................27
3.01. Initial Conditions Precedent................................................27
3.02. Conditions Precedent to Each Credit Event...................................27
3.03. Covenant to Deliver.........................................................28
SECTION IV. REPRESENTATIONS AND WARRANTIES...........................................28
4.01. Borrower's Representations and Warranties...................................28
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TABLE OF CONTENTS
(CONTINUED)
PAGE
4.02. Reaffirmation...............................................................32
SECTION V. COVENANTS................................................................32
5.01. Affirmative Covenants.......................................................32
5.02. Negative Covenants..........................................................34
SECTION VI. DEFAULT..................................................................39
6.01. Events of Default...........................................................39
6.02. Remedies....................................................................40
6.03. Lender Rate Contract Remedies...............................................40
SECTION VII. THE AGENT AND RELATIONS AMONG LENDERS....................................41
7.01. Appointment, Powers and Immunities..........................................41
7.02. Reliance by Agent...........................................................41
7.03. Defaults....................................................................41
7.04. Indemnification.............................................................41
7.05. Non-Reliance................................................................42
7.06. Resignation or Removal of Agent.............................................42
7.07. Agent in its Individual Capacity............................................42
7.08. Co-Agents...................................................................42
SECTION VIII. MISCELLANEOUS............................................................42
8.01. Notices.....................................................................42
8.02. Expenses....................................................................43
8.03. Indemnification.............................................................43
8.04. Waivers; Amendments.........................................................44
8.05. Successors and Assigns......................................................44
8.06. Setoff; Security Interest...................................................46
8.07. No Third Party Rights.......................................................47
8.08. Partial Invalidity..........................................................47
8.09. Jury Trial..................................................................47
8.10. Counterparts................................................................47
8.11. Confidentiality.............................................................47
8.12. Consent to Jurisdiction.....................................................47
8.13. Usury.......................................................................48
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TABLE OF CONTENTS
(CONTINUED)
SCHEDULES PAGE
I Lenders
II Pricing Grid
3.01 Initial Conditions Precedent
4.01(o) Subsidiaries
5.02(a) Existing Secured Indebtedness
5.02(e) Existing Investments
EXHIBITS
A Notice of Revolving Loan Borrowing (2.01(a))
B Notice of Term Loan Borrowing (2.01(b))
C(1) Revolving Loan Note (2.08(a))
C(2) Term Loan Note (2.08(a))
D Guaranty (2.13(a))
E Pledge Agreement (2.13(a))
F Assignment Agreement (8.05(c))
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 27, 1999, is entered into by
and among:
(1) FLEXTRONICS INTERNATIONAL USA, INC., a California corporation
("Borrower");
(2) Each of the financial institutions from time to time listed
in Schedule I hereto, as amended from time to time (such financial
institutions to be referred to herein collectively as "Lenders");
(3) ABN AMRO BANK N.V., as agent for Lenders (in such capacity,
"Agent");
(4) BankBoston, N.A., as documentation agent for Lenders (in such
capacity, "Documentation Agent"); and
(4) Bank of America, N.A., Banque Nationale de Paris, The Bank of
Nova Scotia and Citicorp USA, Inc., as co-agents (collectively, in such
capacity, the "Co-Agents").
RECITALS
A. Borrower has requested Lenders to provide certain credit facilities
to Borrower.
B. Lenders are willing to provide such credit facilities upon the terms
and subject to the conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the above Recitals and the mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION I. INTERPRETATION.
1.01. Definitions. Unless otherwise indicated in this Agreement or any
other Credit Document, each term set forth below, when used in this Agreement or
any other Credit Document, shall have the respective meaning given to that term
below or in the provision of this Agreement or other document, instrument or
agreement referenced below.
"ABN AMRO" shall mean ABN AMRO Bank N.V.
"Affiliate" shall mean, with respect to any Person, each other
Person that (a) directly or indirectly, owns or controls, whether
beneficially or as a trustee, guardian or other fiduciary, ten percent
(10%) or more of any class of Equity Securities of such Person or (b)
that controls, is controlled by or is under common control with such
Person or any Affiliate of such Person; provided, however, that in no
case shall Agent or any Lender be deemed to be an Affiliate of Borrower
or any of its Subsidiaries for purposes of this Agreement. For the
purpose of this definition, "control" of a Person shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership
of voting securities, by contract or otherwise.
"Agent" shall have the meaning given to that term in clause (3)
of the introductory paragraph hereof.
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"Agent's Fee Letter" shall mean the letter agreement dated as of
September 2, 1999 between FIL and Agent.
"Agreement" shall mean this Credit Agreement.
"Applicable Lending Office" shall mean, with respect to any
Lender and any Borrowing, (i) in the case of any Base Rate Loan or Base
Rate Portion, such Lender's Domestic Lending Office, and (ii) in the
case of any LIBOR Loan or LIBOR Portion, such Lender's Euro-Dollar
Lending Office.
"Applicable Margin" shall mean, with respect to any Borrowing or
Borrowing Portion at any time, the per annum margin which is determined
pursuant to the Pricing Grid and added to the Base Rate or LIBO Rate, as
the case may be, for such Borrowing or Portion; provided, however, that
each Applicable Margin determined pursuant to the Pricing Grid shall be
increased by two percent (2.00%) per annum on the date an Event of
Default occurs and shall continue at such increased rate unless and
until such Event of Default is cured or waived in accordance with this
Agreement. The Applicable Margins shall be determined as provided in the
Pricing Grid (subject to the proviso in the preceding sentence) and may
change for each Pricing Period.
"Applicable Payment Office" shall mean the Borrower's offices
located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇.
"Applicable Rate Page" shall mean the applicable Telerate Page on
which appears the London Interbank Offered Rate for deposits in Dollars
at such time or, if no such page is then available, the applicable
Reuters Screen Page on which such information then appears.
"Assignee Lender" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Assignment" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Assignment Agreement" shall have the meaning given to that term
in Subparagraph 8.05(c).
"Assignment Effective Date" shall have, with respect to each
Assignment Agreement, the meaning set forth therein.
"Assignor Lender" shall have the meaning given to that term in
Subparagraph 8.05(c).
"Base Rate" shall mean, on any day, the greater of (a) the Prime
Rate in effect on such date and (b) the Federal Funds Rate for such day
plus one-half percent (0.50%).
"Base Rate Borrowing" shall mean any Revolving Loan Borrowing
consisting of Base Rate Loans.
"Base Rate Loan" shall mean any Revolving Loan bearing interest
based upon the Base Rate.
"Base Rate Portion" shall mean a portion of the Term Loan
Borrowing or a Term Loan bearing interest based upon the Base Rate.
"Borrower" shall have the meaning given to that term in Recital
A.
"Borrowing" shall mean any Revolving Loan Borrowing or Term Loan
Borrowing.
"Business Day" shall mean any day on which commercial banks are
not authorized or required to close in San Francisco, California, New
York, New York or Chicago, Illinois, other than Saturday or Sunday, and
if such Business Day is related to a Revolving Loan Borrowing consisting
of LIBOR Loans or
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a LIBOR Portion of the Term Loan Borrowing, dealings in Dollar deposits
are carried out in the London interbank market and commercial banks are
open for business in London.
"Capital" shall mean, with respect to FIL at any time, the sum,
determined on a consolidated basis in accordance with GAAP, of the
Indebtedness and net worth of FIL and its Subsidiaries at such time.
"Capital Adequacy Requirement" shall have the meaning given to
that term in Subparagraph 2.10(d).
"Capital Leases" shall mean any and all lease obligations that,
in accordance with GAAP, are required to be capitalized on the books of
a lessee.
"Change of Control" shall mean:
(a) With respect to FIL, (i) the acquisition after the
date hereof by any person or group of persons (within the meaning
of Section 13 or 14 of the Securities Exchange Act of 1934 (as
amended, the "Exchange Act")) of (A) beneficial ownership (within
the meaning of Rule 13d-3 promulgated by the Securities and
Exchange Commission under the Exchange Act) of fifty percent
(50%) or more of the outstanding Equity Securities of FIL
entitled to vote for members of the board of directors, or (B)
all or substantially all of the assets of FIL; (ii) during any
period of twelve (12) consecutive calendar months, individuals
who are directors of FIL on the first day of such period
("Initial Directors") and any directors of FIL who are
specifically approved by two-thirds of the Initial Directors and
previously-approved Directors shall cease to constitute a
majority of the Board of Directors of FIL before the end of such
period; or (iii) any other event or condition constituting a
"Change of Control" (or similar defined term) under the
Subordinated Indenture (or any agreement refinancing the
Indebtedness thereunder) shall occur or exist; or
(b) With respect to Borrower or any Material Subsidiary
other than (i) Flextronics International, GmbH and (ii) any
Material Subsidiary acquired after the date hereof, FIL shall
cease to own directly or indirectly one hundred percent (100%) of
the Equity Securities of such Borrower or Material Subsidiary;
provided, however, that if all Subsidiaries are deemed to be
Material Subsidiaries pursuant to the proviso included in the
definition of Material Subsidiary, a Change of Control shall be
deemed to occur only if FIL sells or transfers any Equity
Securities of such Subsidiaries; or
(c) With respect to Flextronics International, GmbH, FIL
shall cease to own directly or indirectly, at least ninety-two
percent (92%) of the Equity Securities of such Material
Subsidiary; or
(d) With respect to any Material Subsidiary that becomes a
Material Subsidiary after the date hereof, FIL shall cease to own
directly or indirectly the percentage of the Equity Securities
owned by FIL at the time such Material Subsidiary became a
Material Subsidiary.
"Change of Law" shall have the meaning given to that term in
Subparagraph 2.10(b).
"Closing Date" shall mean October 27, 1999.
"Co-Agents" shall have the meaning given to that term in clause
(5) of the introductory paragraph hereof.
"Collateral" shall mean all property in which Agent or any Lender
has a Lien to secure the Obligations.
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"Commitment" shall mean, with respect to each Lender, the Dollar
amount set forth under the caption "Commitment" opposite such Lender's
name on Part A of Schedule I, or, if changed, such Dollar amount as may
be set forth for such Lender in the Register.
"Commitment Fee Percentage" shall mean the per annum percentage
which is used to calculate the Commitment Fees. The Commitment Fee
Percentage shall be determined as provided in the Pricing Grid and may
change for each Pricing Period.
"Commitment Fees" shall have the meaning given to that term in
Subparagraph 2.04(b).
"Compliance Certificate" shall have the meaning given to that
term in Subparagraph 5.01(a).
"Contingent Obligation" shall mean, with respect to any Person,
(a) any Guaranty Obligation of that Person; and (b) any direct or
indirect obligation or liability, contingent or otherwise, of that
Person (i) in respect of any Surety Instrument issued for the account of
that Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments, (ii) as a partner or joint
venturer in any partnership or joint venture, (iii) to purchase any
materials, supplies or other property from, or to obtain the services
of, another Person if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of whether
delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered, or (iv) in
respect to any Rate Contract that is not entered into in connection with
a bona fide hedging operation that provides offsetting benefits to such
Person. The amount of any Contingent Obligation shall (subject, in the
case of Guaranty Obligations, to the last sentence of the definition of
"Guaranty Obligation") be deemed equal to the maximum reasonably
anticipated liability in respect thereof, and shall, with respect to
item (b)(iv) of this definition be marked to market on a current basis.
"Contractual Obligation" of any Person shall mean, any indenture,
note, lease, loan agreement, security, deed of trust, mortgage, security
agreement, guaranty, instrument, contract, agreement or other form of
contractual obligation or undertaking to which such Person is a party or
by which such Person or any of its property is bound.
"Credit Documents" shall mean and include this Agreement, the
Notes, the Security Documents, Lender Rate Contracts and the Agent's Fee
Letter, the FIL Credit Documents, all other documents, instruments and
agreements delivered to Agent or any Lender pursuant to Section III; and
all other documents, instruments and agreements delivered by Borrower or
any of its Guarantors or Subsidiaries to Agent or any Lender in
connection with this Agreement on or after the date of this Agreement.
"Credit Event" shall mean (a) the making of any Loan; (b) the
conversion of any Portion of the Term Loan Borrowing into a LIBOR
Portion; (c) the selection of a new Interest Period exceeding one (1)
month for any LIBOR Portion of the Term Loan Borrowing; or (d) the
selection of a new Interest Period exceeding one (1) month for any LIBOR
Borrowing.
"Debt/EBITDA Ratio" shall mean, with respect to FIL for any
period, the ratio, determined on a consolidated basis in accordance with
GAAP, of:
(a) The total Indebtedness of FIL and its Subsidiaries on
the last day of such period;
to
(b) The EBITDA of FIL and its Subsidiaries for such
period.
"Default" shall mean an Event of Default or any event or
circumstance not yet constituting an Event of Default which, with the
giving of any notice or the lapse of any period of time or both, would
become an Event of Default.
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"Defaulting Lender" shall mean a Lender which has failed to fund
its portion of any Borrowing which it is required to fund under this
Agreement and has continued in such failure for three (3) Business Days
after written notice from Agent.
"Documentation Agent" shall have the meaning given to that term
in clause (4) of the introductory paragraph hereof.
"Dollars" and "$" shall mean, unless otherwise indicated, the
lawful currency of the United States of America and, in relation to any
payment under this Agreement, same day or immediately available funds.
"Domestic Lending Office" shall mean, with respect to any Lender
and its Base Rate Loans and Base Rate Portion, (a) initially, its office
designated as such in Part B of Schedule I (or, in the case of any
Lender which becomes a Lender by an assignment pursuant to Subparagraph
8.05(c), its office designated as such in the applicable Assignment
Agreement) and (b) subsequently, such other office or offices as such
Lender may designate to Agent as the office at which such Lender's Base
Rate Loans and Base Rate Portion will thereafter be maintained and for
the account of which all payments of principal of, and interest on, such
Lender's Base Rate Loans and Base Rate Portion will thereafter be made.
"EBITDA" shall mean, with respect to FIL for any period, the sum,
determined on a consolidated basis in accordance with GAAP, of the
following:
(a) The net income or net loss of FIL and its Subsidiaries
for such period before provision for income taxes;
plus
(b) The sum (to the extent deducted in calculating net
income or loss in clause (a) above) of (i) all Interest Expenses
of FIL and its Subsidiaries accruing during such period, (ii) all
depreciation and amortization expenses of FIL and its
Subsidiaries accruing during such period and (iii) other noncash
charges for such period.
"Eligible Assignee" shall mean a commercial bank, a subsidiary of
a Lender, or any other financial institution that makes or purchases
commercial loans in the ordinary course of business, in each case having
a combined capital and surplus of at least $100,000,000.
"Eligible Material Subsidiary" shall mean, at any time, any
Material Subsidiary that is not then an Ineligible Material Subsidiary.
"Employee Benefit Plan" shall mean any employee benefit plan
within the meaning of section 3(3) of ERISA maintained or contributed to
by Borrower, any Material Subsidiary or any ERISA Affiliate, other than
a Multiemployer Plan.
"Environmental Laws" shall mean all the Governmental Rules
relating to the protection of human health and the environment,
including all Governmental Rules pertaining to the reporting, licensing,
permitting, transportation, storage, disposal, investigation or
remediation of emissions, discharges, releases, or threatened releases
of Hazardous Materials into the air, surface water, groundwater, or
land, or relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation or handling of Hazardous
Materials.
"Equity Securities" of any Person shall mean (a) all common
stock, preferred stock, participations, shares, partnership interests or
other equity interests in and of such Person (regardless of how
designated and whether or not voting or non-voting) and (b) all
warrants, options and other rights to acquire any of the foregoing.
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"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as the same may from time to time be amended or supplemented,
including any rules or regulations issued in connection therewith.
"ERISA Affiliate" shall mean any Person which is treated as a
single employer with Borrower or any Material Subsidiary under Section
414 of the IRC.
"Euro-Dollar Lending Office" shall mean, with respect to any
Lender and LIBOR Loans and LIBOR Portions, (a) initially, such Lender's
office designated as such in Part B of Schedule I (or, in the case of
any Lender which becomes a Lender by an assignment pursuant to
Subparagraph 8.05(c), its office designated as such in the applicable
Assignment Agreement) and (b) subsequently, such other office or offices
as such Lender may designate to Agent as the office at which such
Lender's LIBOR Loans and LIBOR Portions will thereafter be maintained
and for the account of which all payments of principal of, and interest
on, such Lender's LIBOR Loans and LIBOR Portions will thereafter be
made.
"Event of Default" shall have the meaning given to that term in
Paragraph 6.01.
"Existing Secured Indebtedness" shall mean the secured
Indebtedness existing on the Closing Date specified on Schedule 5.02(a).
"Excluded Taxes" shall mean all Taxes measured by or imposed upon
the overall net income of any Lender or one of its Applicable Lending
Offices and all franchise taxes imposed upon any Lender, in each case
imposed (i) by the jurisdiction under the laws of which such Lender or
one of its Applicable Lending Offices is organized or is located, or in
which its principal executive office is located, or any nation within
which such jurisdiction is located or any political subdivision thereof
or (ii) by reason of any connection between the jurisdiction imposing
such tax and such Lender or one of its Applicable Lending Offices other
than a connection arising solely from such Lender having executed,
delivered or performed its obligations under, or received payment under
or enforced, this Agreement or any of the other Credit Documents.
"Existing FIUI Credit Agreement" shall mean the Amended and
Restated Revolving Credit Agreement dated as of January 14, 1998 among
Borrower, BankBoston, N.A. and other lending institutions, and
BankBoston, N.A., as agent for itself and such other lending
institutions.
"Federal Funds Rate" shall mean, for any day, the rate per annum
set forth in the weekly statistical release designated as H.15(519), or
any successor publication, published by the Federal Reserve Board
(including any such successor publication, "H.15 (519)") for such day
opposite the caption "Federal Funds (Effective)". If on any relevant
day, such rate is not yet published in H.15 (519), the rate for such day
shall be the rate set forth in the daily statistical release designated
as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or
any successor publication, published by the Federal Reserve Bank of New
York (including any such successor publication, the "Composite 3:30 p.m.
Quotations") for such day under the caption "Federal Funds Effective
Rate". If on any relevant day, such rate is not yet published in either
H.15 (519) or the Composite 3:30 p.m. Quotations, the rate for such day
shall be the arithmetic means, as determined by Agent, of the rates
quoted to Agent for such day by three (3) Federal funds brokers of
recognized standing selected by Agent for overnight federal funds
transactions.
"Federal Reserve Board" shall mean the Board of Governors of the
Federal Reserve System.
"FIL" shall mean Flextronics International Ltd., a Singapore
corporation.
"FIL Credit Agreement" shall mean the Credit Agreement dated the
date hereof among FIL, each of the financial institutions from time to
time party thereto, ABN AMRO Bank N.V., as agent, and BankBoston, N.A.,
as documentation agent, Bank of America, N.A., Banque Nationale de
Paris, The Bank of Nova Scotia and Citicorp USA, Inc., as co-agents, as
amended or restated from time to time.
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"FIL Credit Documents" shall mean the FIL Credit Agreement and
all agreements, documents and instruments delivered to the agent or any
Lender under the FIL Credit Agreement.
"Financial Statements" shall mean, with respect to any accounting
period for any Person, statements of income, shareholders' equity and
cash flows of such Person for such period, and a balance sheet of such
Person as of the end of such period, setting forth in each case in
comparative form figures for the corresponding period in the preceding
fiscal year if such period is less than a full fiscal year or, if such
period is a full fiscal year, corresponding figures from the preceding
annual audit, all prepared in reasonable detail and in accordance with
GAAP.
"Foreign Plan" shall mean any employee benefit plan maintained by
Borrower or any of its Subsidiaries which is mandated or governed by any
Governmental Rule of any Governmental Authority other than the United
States.
"Foreign Subsidiary" shall mean any Subsidiary of FIL that is
organized under the laws of a jurisdiction other than the United States
or a state thereof.
"GAAP" shall mean generally accepted accounting principles and
practices as in effect in the United States of America from time to
time, consistently applied.
"Governmental Authority" shall mean any domestic or foreign
national, state or local government, any political subdivision thereof,
any department, agency, authority or bureau of any of the foregoing, or
any other entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government, including,
without limitation, the Federal Deposit Insurance Corporation, the
Federal Reserve Board, the Comptroller of the Currency, any central bank
or any comparable authority.
"Governmental Charges" shall mean, with respect to any Person,
all levies, assessments, fees, claims or other charges imposed by any
Governmental Authority upon such Person or any of its property or
otherwise payable by such Person.
"Governmental Rule" shall mean any law, rule, regulation,
ordinance, order, code interpretation, judgment, decree, directive,
guidelines, policy or similar form of decision of any Governmental
Authority.
"Guarantor" shall mean each of FIL and the Material Subsidiaries
that has executed the Guaranty or otherwise become a party thereto.
"Guaranty" shall have the meaning given to that term in
Subparagraph 2.13(a).
"Guaranty Obligation" shall mean, with respect to any Person, any
direct or indirect liability of that Person with respect to any
indebtedness, lease, dividend, letter of credit or other obligation (the
"primary obligations") of another Person (the "primary obligor"),
including any obligation of that Person, whether or not contingent, (a)
to purchase, repurchase or otherwise acquire such primary obligations or
any property constituting direct or indirect security therefor, or (b)
to advance or provide funds (i) for the payment or discharge of any such
primary obligation, or (ii) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or
solvency or any balance sheet item, level of income or financial
condition of the primary obligor, or (c) to purchase property,
securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to
make payment of such primary obligation, or (d) otherwise to assure or
hold harmless the holder of any such primary obligation against loss in
respect thereof. The amount of any Guaranty Obligation shall be deemed
equal to the stated or determinable amount of the primary obligation in
respect of which such Guaranty Obligation is made or, if not stated or
if indeterminable, the maximum reasonably anticipated liability in
respect thereof.
"Hazardous Materials" shall mean all pollutants, contaminants and
other materials, substances and wastes which are hazardous, toxic,
caustic, harmful or dangerous to human health or the environment,
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including petroleum and petroleum and petroleum products and byproducts,
radioactive materials, asbestos and polychlorinated biphenyls.
"Indebtedness" of any Person shall mean, without duplication:
(a) All obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments and all other
obligations of such Person for borrowed money (including
obligations to repurchase receivables and other assets sold with
recourse);
(b) All obligations of such Person for the deferred
purchase price of property or services (including obligations
under letters of credit and other credit facilities which secure
or finance such purchase price, and obligations under "synthetic"
leases);
(c) All obligations of such Person under conditional sale
or other title retention agreements with respect to property
acquired by such Person (to the extent of the value of such
property if the rights and remedies of the seller or lender under
such agreement in the event of default are limited solely to
repossession or sale of such property);
(d) All obligations of such Person as lessee under or with
respect to Capital Leases;
(e) All obligations of such Person, contingent or
otherwise, under or with respect to Surety Instruments;
(f) All obligations of such Person, contingent or
otherwise, under or with respect to Rate Contracts;
(g) All Guaranty Obligations of such Person with respect
to the obligations of other Persons of the types described in
clauses (a) - (f) above and all other Contingent Obligations of
such Person; and
(h) All obligations of other Persons of the types
described in clauses (a) - (f) above to the extent secured by (or
for which any holder of such obligations has an existing right,
contingent or otherwise, to be secured by) any Lien in any
property (including accounts and contract rights) of such Person,
even though such Person has not assumed or become liable for the
payment of such obligations.
"Indebtedness/Capital Ratio" shall mean, with respect to FIL on
any date, the ratio, determined on a consolidated basis in accordance
with GAAP, of:
(a) The Indebtedness of FIL and its Subsidiaries on such
date;
to
(b) The Capital of FIL and its Subsidiaries on such date.
"Ineligible Material Subsidiary" shall mean, at any time, any
Material Subsidiary that (a) is then prohibited by any applicable
Governmental Rule from acting as a Guarantor under the Guaranty or (b)
that then would incur, or would cause FIL or Borrower to incur, a
significant increase in its tax liabilities as a result of acting as a
Guarantor under the Guaranty.
"Interest Expenses" shall mean, with respect to any Person for
any period, the sum, determined on a consolidated basis in accordance
with GAAP, of (a) all interest expenses of such Person during such
period (including interest attributable to Capital Leases) plus (b) all
fees in respect of outstanding letters of credit paid, accrued or
scheduled for payment by such Person during such period.
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"Interest Period" shall mean:
(a) With respect to any LIBOR Borrowing, the time period
selected by Borrower pursuant to clause (ii) of Subparagraph
2.01(a) which commences on the date of such Borrowing and ends on
the last day of such time period, and thereafter, each subsequent
time period selected by Borrower pursuant to Subparagraph 2.02(b)
which commences on the last day of the immediately preceding time
period and ends on the last day of that time period; and
(b) With respect to any LIBOR Portion of the Term Loan
Borrowing, the time period selected by Borrower pursuant to
clause (ii) or (iv) of Subparagraph 2.01(b) which commences on
the date of such Borrowing, or the effective date of any
conversion of a Base Rate Portion to a LIBOR Portion, and ends on
the last day of such time period, and thereafter, each subsequent
time period selected by Borrower pursuant to Subparagraph 2.02(b)
which commences on the last day of the immediately preceding time
period and ends on the last day of that time period.
"Investment" of any Person shall mean any loan or advance of
funds by such Person to any other Person (other than advances to
employees of such Person for moving and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business),
any purchase or other acquisition of any Equity Securities or
Indebtedness of any other Person, any capital contribution by such
Person to or any other investment by such Person in any other Person
(including any Guaranty Obligations of such Person and any indebtedness
of such Person of the type described in clause (h) of the definition of
"Indebtedness" on behalf of any other Person); provided, however, that
Investments shall not include (a) accounts receivable or other
indebtedness owed by customers of such Person which are current assets
and arose from sales of inventory in the ordinary course of such
Person's business or (b) prepaid expenses of such Person incurred and
prepaid in the ordinary course of business.
"IRC" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"Lender" shall mean (a) at any time on or prior to the Revolver
Termination Date, a Lender then having a Commitment and (b) at any time
after the Revolver Termination Date, a Lender then having a Loan
outstanding.
"Lender Rate Contract" shall mean any Rate Contract entered into
by either Borrower or its Subsidiaries with a Lender or its Affiliates
as permitted by this Agreement.
"LIBO Rate" shall mean, with respect to any Interest Period for
any LIBOR Borrowing or any LIBOR Portion of the Term Loan Borrowing, a
rate per annum equal to the quotient (rounded upward if necessary to the
nearest 1/100 of one percent) of (a) the arithmetic mean (rounded upward
if necessary to the nearest 1/16 of one percent) of the rates per annum
appearing on the Applicable Rate Page for Dollars on the second Business
Day prior to the first day of such Interest Period at or about 11:00
A.M. (London time) (for delivery of Dollars on the first day of such
Interest Period) for a term comparable to such Interest Period, divided
by (b) one minus any applicable Reserve Requirement in effect from time
to time. If for any reason rates are not available as provided in clause
(a) of the preceding sentence, the rate to be used in clause (a) shall
be, at the Agent's discretion, (i) the rate per annum at which deposits
in Dollars are offered to Agent in the London interbank market or (ii)
the rate at which deposits in Dollars are offered to Agent in, or by
Agent to major banks in, any offshore interbank market selected by
Agent, in each case on the second Business Day prior to the commencement
of such Interest Period at or about 10:00 A.M. (New York time) (for
delivery on the first day of such Interest Period) for a term comparable
to such Interest Period and in an amount approximately equal to the
amount of the Loan to be made or funded by Agent as part of such
Borrowing or the Portion to be made or funded by Agent as part of the
Term Loan Borrowing, as the case may be. The LIBO Rate shall be adjusted
automatically as to all LIBOR Loans and LIBOR Portions outstanding as of
the effective date of any change in the Reserve Requirement.
"LIBOR Borrowing" shall mean any Revolving Loan Borrowing
consisting of LIBOR Loans.
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"LIBOR Loan" shall mean any Revolving Loan bearing interest based
upon the LIBO Rate.
"LIBOR Portion" shall mean a portion of the Term Loan Borrowing
bearing interest based upon the LIBO Rate.
"Lien" shall mean, with respect to any property, any security
interest, mortgage, pledge, lien, charge or other encumbrance in, of, or
on such property or the income therefrom, including, without limitation,
the interest of a vendor or lessor under a conditional sale agreement,
Capital Lease or other title retention agreement, or any agreement to
provide any of the foregoing.
"Loan" shall mean a Revolving Loan or Term Loan.
"Loan Account" shall have the meaning given to that term in
Subparagraph 2.07(a).
"Margin Stock" shall have the meaning given to that term in
Regulation U issued by the Federal Reserve Board.
"Material Adverse Effect" shall mean a material adverse effect on
(a) the business, assets, operations or financial or other condition of
FIL and its Subsidiaries, taken as a whole, or Borrower and its
Subsidiaries, taken as a whole; (b) the ability of Borrower to pay or
perform its Obligations in accordance with the terms of this Agreement
and the other Credit Documents or the ability of FIL to pay or perform
its obligations in accordance with the terms of the FIL Credit
Documents; (c) the ability of the Guarantors (taken as a whole) to pay
or perform the Obligations in accordance with the terms of this
Agreement and the other Credit Documents; (d) the rights and remedies of
Agent or any Lender under this Agreement, the other Credit Documents or
any related document, instrument or agreement; or (e) the value of the
Collateral, Agent's or any Lender's security interest in the Collateral
or the perfection or priority of such security interests.
"Material Subsidiary" shall mean, at any time during any fiscal
year of FIL, any Subsidiary of FIL that (a) had revenues during the
immediately preceding fiscal year equal to or greater than five percent
(5.0%) of the consolidated total revenues of FIL and all of its
Subsidiaries during such preceding year or (b) held assets, excluding
investments in Subsidiaries, on the last day of the immediately
preceding fiscal year equal to or greater than ten percent (10%) of the
consolidated total assets of FIL and all of its Subsidiaries on such
date; provided, however, that if, during any fiscal year, the revenues
of the Subsidiaries of FIL that are not Material Subsidiaries exceed
twenty-five percent (25%) of the consolidated total revenues of FIL and
all of its Subsidiaries during such year, "Material Subsidiary" shall
mean and include each Subsidiary of FIL during the next succeeding
fiscal year.
"maturity" shall mean, with respect to any Loan, interest, fee or
other amount payable by Borrower under this Agreement or the other
Credit Documents, the date such Loan, interest, fee or other amount
becomes due, whether upon the stated maturity or due date, upon
acceleration or otherwise.
"Multiemployer Plan" shall mean any multiemployer plan within the
meaning of section 3(37) of ERISA maintained or contributed to by FIL,
Borrower, any Material Subsidiary or any ERISA Affiliate.
"Non-Excluded Taxes" shall mean all Taxes other than Excluded
Taxes.
"Note" shall mean a Revolving Loan Note or Term Loan Note.
"Notice of Borrowing" shall mean a Notice of Revolving Loan
Borrowing or the Notice of Term Loan Borrowing.
"Notice of Interest Period Selection" shall have the meaning
given to that term in Subparagraph 2.02(b).
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"Notice of Revolving Loan Borrowing" shall have the meaning given
to that term in Subparagraph 2.01(a).
"Notice of Term Loan Borrowing" shall have the meaning given to
that term in Subparagraph 2.01(b).
"Notice of Term Loan Conversion" shall have the meaning given to
that term in Subparagraph 2.01(b).
"Obligations" shall mean and include all loans, advances, debts,
liabilities, and obligations, howsoever arising, owed by Borrower to
Agent or any Lender of every kind and description (whether or not
evidenced by any note or instrument and whether or not for the payment
of money), direct or indirect, absolute or contingent, due or to become
due, now existing or hereafter arising pursuant to the terms of this
Agreement or any of the other Credit Documents, including all interest,
fees, charges, expenses, attorneys' fees and accountants' fees
chargeable to Borrower or payable by Borrower thereunder.
"Participant" shall have the meaning given to that term in
Subparagraph 8.05(b).
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Indebtedness" shall have the meaning given to that
term in Subparagraph 5.02(a).
"Permitted Liens" shall have the meaning given to that term in
Subparagraph 5.02(b).
"Person" shall mean and include an individual, a partnership, a
corporation (including a business trust), a joint stock company, an
unincorporated association, a limited liability company, a joint
venture, a trust or other entity or a Governmental Authority.
"Pledge Agreement" shall have the meaning given to that term in
Subparagraph 2.13(a).
"Portion" shall mean a portion of the principal amount of the
Term Loan Borrowing or any Term Loan. The Term Loan Borrowing shall
consist of one or more Portions, and each Term Loan comprising the Term
Loan Borrowing shall consist of the same number of Portions, with each
such Loan Portion corresponding pro rata to a Borrowing Portion. Any
reference to a Portion of the Term Loan Borrowing shall include the
corresponding Portion of each Term Loan comprising the Term Loan
Borrowing.
"Pricing Grid" shall mean Schedule II.
"Pricing Period" shall mean (a) the period commencing on the date
of this Agreement and ending on December 31, 1999 and (b) each
consecutive calendar quarter thereafter which commences on the day
following the last day of the immediately preceding calendar quarter and
ends on the last day of that calendar quarter.
"Pricing Reduction Capital Requirement" shall mean, with respect
to FIL on the last day of any calendar quarter, the satisfaction by FIL
of each of the following two requirements:
(a) The issuance by FIL after September 24, 1999 and prior
to such day of Equity Securities that reduce FIL's
Indebtedness/Capital Ratio to 0.30 or less; and
(b) The continued maintenance by FIL on such day of an
Indebtedness/Capital Ratio that is 0.30 or less.
"Prime Rate" shall mean the per annum rate publicly announced by
ABN AMRO from time to time at its Chicago office as its "prime rate."
The Prime Rate is determined by ABN AMRO from time to time as a means of
pricing credit extensions to some customers and is neither directly tied
to any external
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rate of interest or index nor necessarily the lowest rate of interest
charged by ABN AMRO at any given time for any particular class of
customers or credit extensions. Any change in the Base Rate resulting
from a change in the Prime Rate shall become effective on the Business
Day on which each change in the Prime Rate occurs.
"Proportionate Share" shall mean, with respect to any Lender at
any time, the percentage (rounded to the eighth digit to the right of
the decimal point) equal to (a) at any time on or prior to the Revolver
Termination Date, such Lender's Commitment at such time divided by the
Total Commitment at such time and (b) at any time after the Revolver
Termination Date, the aggregate principal amount of such Lender's Loans
then outstanding divided by the aggregate principal amount of all
Lenders' Loans then outstanding.
"Rate Contracts" shall mean swap agreements (as that term is
defined in Section 101 of the Federal Bankruptcy Reform Act of 1978, as
amended) and any other agreements or arrangements designed to provide
protection against fluctuations in interest rates, currency exchange
rates or commodity prices.
"Register" shall have the meaning given to that term in
Subparagraph 8.05(d).
"Reportable Event" shall have the meaning given to that term in
ERISA and applicable regulations thereunder.
"Required Lenders" shall mean, at any time, Lenders whose
Proportionate Shares equal or exceed sixty-six and two-thirds percent
(66 2/3%) at such time.
"Requirement of Law" applicable to any Person shall mean (a) the
Articles or Certificate of Incorporation and By-laws, Partnership
Agreement or other organizational or governing documents of such Person,
(b) any Governmental Rule applicable to such Person, (c) any license,
permit, approval or other authorization granted by any Governmental
Authority to or for the benefit of such Person or (d) any judgment,
decision or determination of any Governmental Authority or arbitrator,
in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.
"Reserve Requirement" shall mean, with respect to any day in an
Interest Period for any Revolving Loan Borrowing consisting of LIBOR
Loans or any LIBOR Portion of the Term Loan Borrowing, the aggregate of
the reserve requirement rates (expressed as a decimal) in effect on such
day for eurodollar funding (currently referred to as "Eurocurrency
liabilities" in Regulation D of the Federal Reserve Board) maintained by
a member bank of the Federal Reserve System. As used herein, the term
"reserve requirement" shall include, without limitation, any basic,
supplemental or emergency reserve requirements imposed on any Lender by
any Governmental Authority.
"Revolver Termination Date" shall mean October 25, 2000.
"Revolving Loan" shall have the meaning given to that term in
Subparagraph 2.01(a).
"Revolving Loan Borrowing" shall mean a borrowing consisting of
all the Revolving Loans of the same Type (and same Interest Period if
LIBOR Loans) made by the Lenders on the same date pursuant to the same
Notice of Revolving Loan Borrowing. Any reference to a Revolving Loan
Borrowing shall include all the Revolving Loans constituting such
Revolving Loan Borrowing.
"Revolving Loan Note" shall have the meaning given to that term
in Subparagraph 2.07(b).
"Security Documents" shall mean and include the Guaranty, the
Pledge Agreements and all other instruments, agreements, certificates,
opinions and documents (including Uniform Commercial Code financing
statements) delivered to Agent or any Lender in connection with any
Collateral or to secure the Obligations.
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"Solvent" shall mean, with respect to any Person on any date,
that on such date (a) the fair value of the property of such Person is
greater than the fair value of the liabilities (including contingent,
subordinated, matured and unliquidated liabilities) of such Person, (b)
the present fair saleable value of the assets of such Person is greater
than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured, (c) such
Person does not intend to, and does not believe that it will, incur
debts or liabilities beyond such Person's ability to pay as such debts
and liabilities mature and (d) such Person is not engaged or about to
engage in business or transactions for which such Person's property
would constitute an unreasonably small capital.
"Subordinated Indenture" shall mean the Indenture dated as of
October 15, 1997 by and between FIL and State Street Bank and Trust
Company of California, N.A., as trustee, and any other document,
instrument or agreement evidencing the subordinating indebtedness
thereunder.
"Subsidiary" of any Person shall mean (a) any corporation of
which more than 50% of the issued and outstanding Equity Securities
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall or
might have voting power upon the occurrence of any contingency) is at
the time directly or indirectly owned or controlled by such Person, by
such Person and one or more of its other Subsidiaries or by one or more
of such Person's other Subsidiaries, (b) any partnership, joint venture,
limited liability company or other association of which more than 50% of
the equity interest having the power to vote, direct or control the
management of such partnership, joint venture or other association is at
the time owned and controlled by such Person, by such Person and one or
more of the other Subsidiaries or by one or more of such Person's other
Subsidiaries or (c) any other Person included in the Financial
Statements of such Person on a consolidated basis.
"Surety Instruments" shall mean all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties, shipside
bonds, surety bonds and similar instruments.
"Taxes" shall mean all present and future income, stamp,
documentary and other taxes and duties, and all other levies, imposts,
charges, fees, deductions and withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority.
"Term Loan" shall have the meaning given to that term in
Subparagraph 2.01(b).
"Term Loan Borrowing" shall mean the borrowing consisting of all
the Term Loans made by the Lenders on the Revolver Termination Date
pursuant to the Notice of Term Loan Borrowing. Any reference to the Term
Loan Borrowing shall include all the Term Loans constituting the Term
Loan Borrowing. Only one Term Loan Borrowing, consisting of the single
Term Loans made by each Lender, shall be made on the Revolver
Termination Date.
"Term Loan Maturity Date" shall mean the date that is one (1)
year after the Revolver Termination Date.
"Term Loan Note" shall have the meaning given to that term in
Subparagraph 2.07(b).
"Total Commitment" shall mean, at any time, the sum of all
Commitments at such time. The Total Commitment on the date of this
Agreement is Eighty Million Dollars ($80,000,000).
"Type" shall mean, with respect to any Revolving Loan, any
Revolving Loan Borrowing or any Portion of any Term Loan or the Term
Loan Borrowing at any time, the classification of such Loan, Borrowing
or Portion by the type of interest rate it then bears, whether an
interest rate based upon the Base Rate or LIBO Rate.
"Unused" shall mean, at any time, the remainder of (i) the Total
Commitment at such time minus (ii) the aggregate principal amount of all
Loans outstanding at such time.
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1.02. GAAP. Unless otherwise indicated in this Agreement or any other
Credit Document, all accounting terms used in this Agreement or any other Credit
Document shall be construed, and all accounting and financial computations
hereunder or thereunder shall be computed, in accordance with GAAP. If GAAP
changes during the term of this Agreement such that any covenants contained
herein would then be calculated in a different manner or with different
components, Borrower, Lenders and Agent agree to negotiate in good faith to
amend this Agreement in such respects as are necessary to conform those
covenants as criteria for evaluating Borrower's financial condition to
substantially the same criteria as were effective prior to such change in GAAP;
provided, however, that, until Borrower, Lenders and Agent so amend this
Agreement, all such covenants shall be calculated in accordance with GAAP as in
effect immediately prior to such change.
1.03. Headings. Headings in this Agreement and each of the other Credit
Documents are for convenience of reference only and are not part of the
substance hereof or thereof.
1.04. Plural Terms. All terms defined in this Agreement or any other
Credit Document in the singular form shall have comparable meanings when used in
the plural form and vice versa.
1.05. Governing Law. Unless otherwise expressly provided in any Credit
Document, this Agreement and each of the other Credit Documents shall be
governed by and construed in accordance with the laws of the State of California
without reference to conflicts of law rules.
1.06. English Language. This Agreement and the other Credit Documents
are executed and shall be construed in the English language. All instruments,
agreements, certificates, opinions and other documents to be furnished or
communications to be given or made under this Agreement or any other Credit
Document shall be in the English language.
1.07. Construction. This Agreement is the result of negotiations among,
and has been reviewed by, Borrower, each Lender, Agent and their respective
counsel. Accordingly, this Agreement shall be deemed to be the product of all
parties hereto, and no ambiguity shall be construed in favor of or against
Borrower, any Lender or Agent.
1.08. Entire Agreement. This Agreement and each of the other Credit
Documents, taken together, constitute and contain the entire agreement of
Borrower, Lenders and Agent and supersede any and all prior agreements,
negotiations, correspondence, understandings and communications among the
parties, whether written or oral, respecting the subject matter hereof
(excluding the Agent's Fee Letter but including the commitment letter dated as
of September 2, 1999 between FIL and ABN AMRO).
1.09. Calculation of Interest and Fees. All calculations of interest and
fees under this Agreement and the other Credit Documents for any period (a)
shall include the first day of such period and exclude the last day of such
period and (b) shall be calculated on the basis of a year of 360 days for actual
days elapsed, except that during any period any Loan or Portion bears interest
based upon the Prime Rate, such interest shall be calculated on the basis of a
year of 365 or 366 days, as appropriate, for actual days elapsed.
1.10. References.
(a) References in this Agreement to "Recitals," "Sections,"
"Paragraphs," "Subparagraphs," "Exhibits" and "Schedules" are to
recitals, sections, paragraphs, subparagraphs, exhibits and schedules
therein and thereto unless otherwise indicated.
(b) References in this Agreement or any other Credit Document to
any document, instrument or agreement (i) shall include all exhibits,
schedules and other attachments thereto, (ii) shall include all
documents, instruments or agreements issued or executed in replacement
thereof if such replacement is permitted hereby, and (iii) shall mean
such document, instrument or agreement, or replacement or predecessor
thereto, as amended, modified and supplemented from time to time and in
effect at any given time if such amendment, modification or supplement
is permitted hereby.
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(c) References in this Agreement or any other Credit Document to
any Governmental Rule (i) shall include any successor Governmental Rule,
(ii) shall include all rules and regulations promulgated under such
Governmental Rule (or any successor Governmental Rule), and (iii) shall
mean such Governmental Rule (or successor Governmental Rule) and such
rules and regulations, as amended, modified, codified or reenacted from
time to time and in effect at any given time.
(d) References in this Agreement or any other Credit Document to
any Person in a particular capacity (i) shall include any permitted
successors to and assigns of such Person in that capacity and (ii) shall
exclude such Person individually or in any other capacity.
1.11. Other Interpretive Provisions. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement or any other
Credit Document shall refer to this Agreement or such other Credit Document, as
the case may be, as a whole and not to any particular provision of this
Agreement or such other Credit Document, as the case may be. The words "include"
and "including" and words of similar import when used in this Agreement or any
other Credit Document shall not be construed to be limiting or exclusive. In the
event of any inconsistency between the terms of this Agreement and the terms of
any other Credit Document, the terms of this Agreement shall govern.
SECTION II. CREDIT FACILITIES.
2.01. Loans.
(a) Revolving Loans.
(i) Availability. Subject to the terms and conditions of
this Agreement (including the amount limitations set forth in
Paragraph 2.03), each Lender severally agrees to advance to
Borrower from time to time during the period beginning on the
Closing Date and ending on the Revolver Termination Date such
revolving loans in United States Dollars as Borrower may request
under this Subparagraph 2.01(a) (individually, a "Revolving
Loan"); provided, however, that no Lender shall have any
obligation to make a requested Revolving Loan if, after giving
effect to such Loan, the aggregate principal amount of all
Revolving Loans made by such Lender and then outstanding would
exceed such Lender's Commitment at such time. All Revolving Loans
shall be made on a pro rata basis by Lenders in accordance with
their respective Proportionate Shares, with each Revolving Loan
Borrowing to be comprised of a Revolving Loan made by each Lender
equal to such Lender's Proportionate Share of such Revolving Loan
Borrowing. Except as otherwise provided herein, Borrower may
borrow, repay and reborrow Revolving Loans until the Revolver
Termination Date.
(ii) Notice of Borrowing. Borrower shall request each
Revolving Loan Borrowing by delivering to Agent an irrevocable
written notice in the form of Exhibit A, appropriately completed
(a "Notice of Revolving Loan Borrowing"), which specifies, among
other things:
(A) The principal amount of such Borrowing, which
shall be in the minimum amount of $1,000,000 or an
integral multiple of $500,000 in excess thereof;
(B) Whether such Borrowing is to consist of Base
Rate Loans or LIBOR Loans;
(C) If such Borrowing is to consist of LIBOR Loans,
the initial Interest Period selected by Borrower for such
Borrowing in accordance with Paragraph 2.02; and
(D) The date of such Borrowing, which shall be a
Business Day.
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Borrower shall give each Notice of Revolving Loan Borrowing to
Agent at least three (3) Business Days before the date of the
requested Revolving Loan Borrowing in the case of a Revolving
Loan Borrowing consisting of LIBOR Loans and at least one (1)
Business Day before the date of the requested Revolving Loan
Borrowing in the case of a Revolving Loan Borrowing consisting of
Base Rate Loans. Each Notice of Revolving Loan Borrowing shall be
signed by Borrower and delivered by first-class mail or facsimile
to Agent at the office or facsimile number and during the hours
specified in Paragraph 8.01; provided, however, that Borrower
shall promptly deliver to Agent the original of any Notice of
Revolving Loan Borrowing initially delivered by facsimile. Agent
shall promptly notify each Lender of the contents of each Notice
of Revolving Loan Borrowing.
(iii) Interest Rates. Borrower shall pay interest on the
unpaid principal amount of each Revolving Loan from the date of
such Revolving Loan until the maturity thereof, at one of the
following rates per annum:
(A) During such periods as such Revolving Loan is a
Base Rate Loan, at a rate per annum equal to the Base Rate
plus the Applicable Margin therefor, such rate to change
from time to time as the Applicable Margin or Base Rate
shall change; and
(B) During such periods as such Revolving Loan is a
LIBOR Loan, at a rate per annum equal at all times during
each Interest Period for such LIBOR Loan to the LIBO Rate
for such Interest Period plus the Applicable Margin
therefor, such rate to change from time to time during
such Interest Period as the Applicable Margin shall
change.
All Revolving Loans in each Revolving Loan Borrowing shall, at
any given time prior to maturity, bear interest at one, and only
one, of the above rates.
(iv) Scheduled Payments. Borrower shall repay the
principal amount of the Revolving Loans in full on the Revolver
Termination Date. Any such repayment may be effected with the
proceeds of the Term Loan Borrowing pursuant to Subparagraph
2.01(b)(vi). Borrower shall pay accrued interest on the unpaid
principal amount of each Revolving Loan in arrears (A) in the
case of a Base Rate Loan, on the 27th day of each January, April,
July and October, (B) in the case of a LIBOR Loan, on the last
day of each Interest Period therefor (and, if any such Interest
Period is longer than three (3) months, every three (3) months);
and (C) in the case of all Revolving Loans, upon prepayment (to
the extent thereof) and at maturity.
(v) Purpose. Borrower shall use the proceeds of the
Revolving Loans first to repay on the Closing Date all
indebtedness outstanding under the Existing Borrower Credit
Agreement and then for Borrower's working capital and general
corporate needs.
(b) Term Loan.
(i) Availability. Subject to the terms and conditions of
this Agreement (including the amount limitations set forth in
Paragraph 2.03), each Lender severally agrees, upon the request
of Borrower pursuant to Subparagraph 2.01(b)(ii), to advance to
Borrower in a single advance on the Revolver Termination Date a
term loan in United States Dollars under this Subparagraph
2.01(b) (individually, a "Term Loan"); provided, however, that no
Lender shall have any obligation to make a requested Term Loan in
a principal amount that would exceed such Lender's Commitment on
the Revolver Termination Date. The Term Loans shall be made on a
pro rata basis by Lenders in accordance with their respective
Proportionate Shares, with the Term Loan Borrowing to be
comprised of a Term Loan by each Lender equal to such Lender's
Proportionate Share of the Term Loan Borrowing. Borrower may not
reborrow the principal amount of a Term Loan after repayment or
prepayment thereof.
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(ii) Notice of Borrowing. Borrower shall request the Term
Loan Borrowing by delivering to Agent an irrevocable written
notice in the form of Exhibit B, appropriately completed (a
"Notice of Term Loan Borrowing"), which specifies, among other
things:
(A) The principal amount of such Borrowing, which
shall be in the minimum amount of $1,000,000 or an
integral multiple of $500,000 in excess thereof;
(B) (1) The principal portion of such Borrowing
which is to be a Base Rate Portion and (2) the principal
portion(s) of such Borrowing which is (are) to be a LIBOR
Portion(s); and
(C) If any Portion of such Borrowing is initially
to be a LIBOR Portion, the initial Interest Period
selected by Borrower for each such Portion in accordance
with Paragraph 2.02.
Borrower shall give the Notice of Term Loan Borrowing to Agent at
least three (3) Business Days before the Revolver Termination
Date if any Portion of the Term Loan Borrowing is initially to be
a LIBOR Portion and at least one (1) Business Day before the
Revolver Termination Date if the only Portion of the Term Loan
Borrowing is initially to be a Base Rate Portion. The Notice of
Term Loan Borrowing shall be signed by Borrower and delivered by
first-class mail or facsimile to Agent at the office or facsimile
number and during the hours specified in Paragraph 8.01;
provided, however, that Borrower shall promptly deliver to Agent
the original of the Notice of Term Loan Borrowing if initially
delivered by facsimile. Agent shall promptly notify each Lender
of the contents of the Notice of Term Loan Borrowing.
(iii) Interest Rates. Borrower shall pay interest on the
unpaid principal amount of each Term Loan from the date of such
Term Loan until the maturity thereof, at the following rates per
annum:
(A) During such periods as any Portion of such Term
Loan is a Base Rate Portion, at a rate per annum on such
Portion equal to the Base Rate plus the Applicable Margin
therefor, such rate to change from time to time as the
Applicable Margin or Base Rate shall change; and
(B) During such periods as any Portion of such Term
Loan is a LIBOR Portion, at a rate per annum on such
Portion equal at all times during each Interest Period for
such Portion to the LIBO Rate for such Interest Period
plus the Applicable Margin therefor, such rate to change
from time to time as the Applicable Margin shall change.
Each Base Rate Portion or LIBOR Portion of the Term Loan
Borrowing shall be in a minimum amount of $1,000,000 or an
integral multiple of $500,000 in excess thereof.
(iv) Conversion of Term Loan Portions. Borrower may
convert any Portion of the Term Loan Borrowing from one Type of
Portion to another Type; provided, however, that any conversion
of a LIBOR Portion into a Base Rate Portion shall be made on, and
only on, the last day of an Interest Period for such LIBOR
Portion. Borrower shall request such a conversion by an
irrevocable written notice to Agent in a form acceptable to
Agent, appropriately completed (a "Notice of Term Loan
Conversion"), which specifies, among other things:
(A) The Portion of the Term Loan Borrowing which is
to be converted;
(B) The amount and Type of each Portion of the Term
Loan Borrowing into which it is to be converted;
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(C) If any Portion of the Term Loan Borrowing is to
be converted into a LIBOR Portion, the initial Interest
Period selected by Borrower for such Portion in accordance
with Paragraph 2.02; and
(D) The date of the requested conversion, which
shall be a Business Day.
Borrower shall give each Notice of Term Loan Conversion to Agent
at least three (3) Business Days before the date of the requested
conversion. Each Notice of Term Loan Conversion shall be
delivered by first-class mail or facsimile to Agent at the office
or to the facsimile number and during the hours specified in
Paragraph 8.01; provided, however, that Borrower shall promptly
deliver to Agent the original of any Notice of Term Loan
Conversion initially delivered by facsimile. Agent shall promptly
notify each Lender of the contents of each Notice of Term Loan
Conversion.
(v) Scheduled Payments. Borrower shall repay the principal
amount of the Term Loans in full in a single installment on the
Term Loan Maturity Date. Borrower shall pay accrued interest on
the unpaid principal amount of each Term Loan in arrears (A) in
the case of a Base Rate Portion, on the 27th day of each January,
April, July and October, (B) in the case of a LIBOR Portion, on
the last day of each Interest Period (and if any such Interest
Period is equal to or longer than three (3) months, every three
(3) months); and (C) in the case of all Term Loans, upon
prepayment (to the extent thereof) and at maturity.
(vi) Purpose. Borrower shall use the proceeds of the Term
Loans first to repay all outstanding Revolving Loans and then for
its working capital and general corporate needs. Any Revolving
Loans outstanding at the time of the funding of any Term Loan
shall be deemed to be converted into Term Loans.
2.02. LIBOR Interest Periods.
(a) Terms. The initial and each subsequent Interest Period
selected by Borrower for a Revolving Loan Borrowing consisting of LIBOR
Loans, any LIBOR Portion of the Term Loan Borrowing shall be one (1),
two (2), three (3) or six (6) months; provided, however, that (i) any
Interest Period which would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business Day
unless such next Business Day falls in another calendar month, in which
case such Interest Period shall end on the immediately preceding
Business Day; (ii) any Interest Period which 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 end on the last Business Day of a calendar month; (iii) no
Interest Period for a Revolving Loan Borrowing shall end after the
Revolver Termination Date; and (iv) no Interest Period for a LIBOR
Portion of the Term Loan Borrowing shall end after the Term Loan
Maturity Date.
(b) Notice of Interest Period Selection. Borrower shall notify
Agent by an irrevocable written notice in a form acceptable to Agent,
appropriately completed (a "Notice of Interest Period Selection"), at
least three (3) Business Days prior to the last day of each Interest
Period for a Revolving Loan Borrowing consisting of LIBOR Loans or any
LIBOR Portion of the Term Loan Borrowing of the Interest Period selected
by Borrower for the next succeeding Interest Period for such Borrowing
or Portion. Each Notice of Interest Period Selection shall be given by
first-class mail or facsimile to the office or the facsimile number and
during the hours specified in Paragraph 8.01; provided, however, that
Borrower shall promptly deliver to Agent the original of any Notice of
Interest Period Selection initially delivered by facsimile. If Borrower
fails to notify Agent of the next Interest Period for a Borrowing or
Portion in accordance with this Paragraph 2.03, the next Interest Period
for such Borrowing or Portion shall be one (1) month.
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2.03. Amount Limitations, Commitment Reductions, Etc.
(a) Commitment Limitations. The aggregate principal amount
of all Loans outstanding at any time shall not exceed the Total
Commitment at such time.
(b) Reduction or Cancellation of Commitments. Upon three
(3) Business Days prior written notice to Agent, Borrower may
permanently reduce the Total Commitment by the amount of Five
Million Dollars ($5,000,000) or an integral multiple of One
Million Dollars ($1,000,000) in excess thereof or cancel the
Total Commitment in its entirety; provided, however, that:
(i) Borrower may not reduce the Total Commitment
prior to the Revolver Termination Date, if, after giving
effect to such reduction, the aggregate principal amount
of all Loans then outstanding would exceed the Total
Commitment; and
(ii) Borrower may not cancel the Total Commitment
prior to the Revolver Termination Date, if, after giving
effect to such cancellation, any Loan would then remain
outstanding.
(c) Effect of Commitment Reductions. From the effective date of
any reduction of the Total Commitment, the Commitment Fees payable
pursuant to Subparagraph 2.04(b) shall be computed on the basis of the
Total Commitment. Once reduced or cancelled, the Total Commitment may
not be increased or reinstated without the prior written consent of all
Lenders. Any reduction of the Total Commitment pursuant to Subparagraph
2.03(b) shall be applied ratably to reduce each Lender's Commitment in
accordance with clause (i) of Subparagraph 2.09(a).
2.04. Fees.
(a) Agent's Fee. Borrower shall pay to Agent, for its own
account, agent's fees and other compensation in the amounts and at the
times set forth in the Agent's Fee Letter.
(b) Commitment Fees. Borrower shall pay to Agent, for the ratable
benefit of Lenders as provided in clause (iii) of Subparagraph 2.09(a),
commitment fees in Dollars (the "Commitment Fees") equal to the
Commitment Fee Percentage of the daily average Unused amount of the
Total Commitment for the period beginning on the date of this Agreement
and ending on the Revolver Termination Date. Borrower shall pay the
Commitment Fees in arrears on the 27th day of January, April, July and
October prior to the Revolver Termination Date (commencing January 27,
2000) and on the Revolver Termination Date.
2.05. Prepayments.
(a) Terms of all Prepayments. Upon the prepayment of any Loan or
Portion (whether such prepayment is an optional prepayment under
Subparagraph 2.05(b), a mandatory prepayment required by Subparagraph
2.05(c) or a mandatory prepayment required by any other provision of
this Agreement or the other Credit Documents, including a prepayment
upon acceleration), Borrower shall pay to the Lender that made such Loan
(i) all accrued interest to the date of such prepayment on the amount
prepaid and (ii) if such prepayment is the prepayment of a LIBOR Loan or
of a LIBOR Portion on a day other than the last day of an Interest
Period for such LIBOR Loan or such LIBOR Portion, all amounts payable to
such Lender pursuant to Paragraph 2.12.
(b) Optional Prepayments. At its option, Borrower may prepay, in
whole or in part, any Borrowing made to it, provided that:
(i) Borrower delivers to Agent prior written notice of
such prepayment, which notice shall be delivered not less than
(A) three (3) Business Days prior to the prepayment of any
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Revolving Loan Borrowing consisting of LIBOR Loans or any LIBOR
Portion of the Term Loan Borrowing; and (B) one (1) Business Day
prior to any prepayment of a Base Rate Borrowing or Base Rate
Portion; and
(ii) Any prepayment in part shall be in a minimum
aggregate principal amount of $1,000,000 and multiples of
$500,000 in excess thereof.
(c) Mandatory Prepayments. If, at any time, the principal amount
of any Loans then outstanding exceeds any limitations set forth in
Subparagraph 2.03(c), Borrower shall immediately prepay such Loans in
such amounts as Agent shall determine are necessary to eliminate such
excess.
(d) Application of Prepayments. All prepayments of Borrowings
shall, to the extent possible, be applied to prepay the Base Rate
Borrowings, Base Rate Portions, LIBOR Borrowings or LIBOR Portions
designated by any Borrower.
2.06. Other Payment Terms.
(a) Place and Manner.
(i) Borrower shall make all payments due to each Lender or
Agent by payments to Agent at Agent's New York office located at
the address specified in Paragraph 8.01, with each such payment
due to a Lender to be for the account of such Lender and such
Lender's applicable Domestic Lending Office or Euro-Dollar
Lending Office, as the case may be.
(ii) Borrower shall, unless otherwise directed by Agent,
make all other payments due to each Lender or Agent hereunder by
payments to Agent's New York office located at the address
specified in Paragraph 8.01, with each such payment due to a
Lender to be for the account of such Lender and such Lender's
Applicable Lending Office.
(iii) Borrower shall make all payments hereunder in same
day or immediately available funds and without deduction or
offset not later than 11:00 a.m. (California time) and on the
date due. Agent shall promptly disburse to each Lender each
payment received by Agent for the account of such Lender.
(b) Date. Whenever any payment due hereunder shall fall due on a
day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall be included in
the computation of interest or fees, as the case may be.
(c) Currency of Payment.
(i) Borrower shall pay principal of, interest on and all
other amounts related to each Borrowing in Dollars. Borrower
shall pay Commitment Fees and all other amounts payable under
this Agreement and the other Credit Documents in Dollars.
(ii) If any amounts required to be paid by Borrower under
this Agreement, any other Credit Document or any order, judgment
or award given or rendered in relation hereto or thereto has to
be converted from the currency (the "first currency") in which
the same is payable hereunder or thereunder into another currency
(the "second currency") for the purpose of (A) making or filing a
claim or proof against Borrower with any Governmental Authority,
(B) obtaining an order or judgment in any court or other tribunal
or (C) enforcing any order or judgment given or made in relation
hereto, Borrower shall, to the fullest extent permitted by law,
indemnify and hold harmless each of the Persons to whom such
amounts are payable from and against any loss suffered as a
result of any discrepancy between (1) the rate of exchange used
for such purpose to convert the amounts in question from the
first currency into the second currency and (2) the rate or rates
of exchange at which such Person may, using reasonable efforts in
the
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ordinary course of business, purchase the first currency with the
second currency upon receipt of a sum paid to it in satisfaction,
in whole or in part, of any such order, judgment, claim or proof.
The foregoing indemnity shall constitute a separate obligation of
Borrower distinct from its other obligations hereunder and shall
survive the giving or making of any judgment or order in relation
to all or any of such obligations. The obligations of Borrower
under this Subparagraph 2.06(c) shall survive the payment and
performance of the Obligations and the termination of this
Agreement.
(d) Late Payments. If any amount required to be paid by Borrower
under this Agreement or the other Credit Documents (including, without
limitation, principal or interest payable on any Loan, any fees or any
other amount) remains unpaid after such amount is due, Borrower shall
pay interest on the aggregate, outstanding balance of such amount from
the date due until such amount is paid in full at a per annum rate equal
to the Base Rate plus two percent (2.00%), such rate to change from time
to time as the Base Rate shall change.
(e) Application of Payments. All payments hereunder shall be
applied first to unpaid fees, costs and expenses then due and payable
under this Agreement or the other Credit Documents, second to accrued
interest then due and payable under this Agreement or the other Credit
Documents and finally to reduce the principal amount of outstanding
Loans.
(f) Failure to Pay Agent. Unless Agent shall have received notice
from Borrower at least one (1) Business Day prior to the date on which
any payment is due to Lenders hereunder that Borrower will not make such
payment in full, Agent shall be entitled to assume that Borrower has
made or will make such payment in full to Agent on such date and Agent
may, in reliance upon such assumption, cause to be paid to the
applicable Lenders on such due date an amount equal to the amount then
due such Lenders. If and to the extent Borrower shall not have so made
such payment in full to Agent, each such 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 a per annum rate equal to the Federal Funds Rate for the first three
(3) days and the Base Rate thereafter. A certificate of Agent submitted
to any Lender with respect to any amount owing by such Lender under this
Subparagraph 2.06(f) shall constitute prima facie evidence of such
amount.
2.07. Loan Accounts; Notes.
(a) Loan Accounts. The obligation of Borrower to repay the Loans
made to it by each Lender and to pay interest thereon at the rates
provided herein shall be evidenced by an account or accounts maintained
by such Lender on its books (individually, a "Loan Account"), except
that any Lender may request that its Loans be evidenced by a note or
notes pursuant to Subparagraph 2.07(b). Each Lender shall record in its
Loan Accounts (i) the date and amount of each Loan made by such Lender,
(ii) the interest rates applicable to each such Loan and each Portion
thereof and the effective dates of all changes thereto, (iii) the
Interest Period for each LIBOR Loan and LIBOR Portion, (iv) the date and
amount of each principal and interest payment on each Loan and Portion
and (v) such other information as such Lender may determine is necessary
for the computation of principal and interest payable to it by Borrower
hereunder; provided, however, that any failure by a Lender to make, or
any error by any Lender in making, any such notation shall not affect
Borrower's Obligations hereunder. The Loan Accounts shall constitute
prima facie evidence of the matters noted therein.
(b) Notes. If any Lender so requests, (i) such Lender's Revolving
Loans shall be evidenced by promissory notes in the form of Exhibit C(1)
(individually, a "Revolving Loan Note") and (ii) such Lender's Term
Loans shall be evidenced by promissory notes in the form of Exhibit C(2)
(individually, a "Term Loan Note"), each of which shall be (A) payable
to the order of such Lender, (B) dated the Closing Date, and (C)
otherwise appropriately completed.
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2.08. Loan Funding.
(a) Lender Funding and Disbursements to Borrower. Each Lender
shall, before 11:00 a.m. (New York time) on the date of each Borrowing,
make available to Agent at Agent's New York office specified in
Paragraph 8.01, in immediately available funds, such Lender's
Proportionate Share of such Borrowing. After Agent's receipt of such
funds and upon satisfaction of the applicable conditions set forth in
Section III, Agent shall promptly disburse such funds to Borrower no
later than 1:00 p.m. (California time) in immediately available funds.
Agent shall disburse the proceeds of each Borrowing as directed by
Borrower in the applicable Notice of Borrowing.
(b) Lender Failure to Fund. Unless Agent shall have received
notice from a Lender prior to the date of a Borrowing that such Lender
will not make available to Agent such Lender's Proportionate Share of
such Borrowing, Agent shall be entitled to assume that such Lender has
made or will make such amount available to Agent on the date of such
Borrowing in accordance with Subparagraph 2.08(a), and Agent may on such
date, in reliance upon such assumption, disburse or otherwise credit to
Borrower a corresponding amount. If any Lender does not make the amount
of its Proportionate Share of a Borrowing available to Agent on or prior
to the date of such Borrowing, such Lender shall pay to Agent, on
demand, interest which shall accrue on such amount from the date of such
Borrowing until such amount is paid to Agent at rates equal to the
Federal Funds Rate for the first three (3) days and the Base Rate
thereafter. A certificate of Agent submitted to any Lender with respect
to any amount owing by such Lender under this Subparagraph 2.08(b) shall
constitute prima facie evidence of such amount. If the amount of any
Lender's Proportionate Share of any Borrowing is not paid to Agent by
such Lender within three (3) Business Days after the date of such
Borrowing, Borrower shall repay such amount to Agent, on demand,
together with interest thereon, for each day from the date such amount
was disbursed to Borrower until the date such amount is repaid to Agent,
at the interest rate applicable at the time to the Loans comprising such
Borrowing.
(c) Lenders' Obligations Several. The failure of any Lender to
make the Loan to be made by it as part of any Borrowing shall not
relieve any other Lender of its obligation hereunder to make its Loan as
part of such Borrowing, but no Lender shall be obligated in any way to
make any Loan which another Lender has failed or refused to make or
otherwise be in any way responsible for the failure or refusal of any
other Lender to make any Loan required to be made by such other Lender.
2.09. Pro Rata Treatment.
(a) Borrowings, Commitment Reductions, Etc. Except as otherwise
provided herein:
(i) Each Borrowing shall be made by Lenders pro rata
according to their respective Commitments. Each reduction of the
Total Commitment shall reduce each Lender's Commitment pro rata.
(ii) Each payment of principal or interest on Loans in any
Borrowing shall be shared among Lenders which made or funded the
Loans in such Borrowing pro rata according to (A) the respective
unpaid principal amounts of such Loans so made or funded by such
Lenders and (B) in the case of interest, the dates on which such
Lenders so made or funded such Loans.
(iii) Each payment of Commitment Fees shall be shared
among Lenders (except for Defaulting Lenders) pro rata according
to (A) their respective Proportionate Shares and (B) in the case
of each Lender which becomes a Lender hereunder after the date
hereof and before the Revolver Termination Date, the date upon
which such Lender so became a Lender.
(iv) Each payment of interest (other than interest on
Loans) shall be shared among Lenders and Agent owed the amount
upon which such interest accrues pro rata according to (A) the
respective amounts so owed such Lenders and Agent and (B) the
dates on which such amounts became owing to such Lenders and
Agent.
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(v) All other payments under this Agreement and the other
Credit Documents shall be for the benefit of the Person or
Persons specified.
(b) Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any
right of setoff, or otherwise) on account of the Loan owed to it as part
of any Borrowing in excess of its ratable share of payments on account
of all Loans in such Borrowing obtained by all applicable Lenders
entitled to such payments, such Lender shall forthwith purchase from
such other Lenders such participations in their Loans as shall be
necessary to cause such purchasing Lender to share the excess payment
ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing
Lender, such purchase shall be rescinded and each other applicable
Lender shall repay to the purchasing Lender the purchase price to the
extent of such recovery together with an amount equal to such other
Lender's ratable share (according to the proportion of (i) the amount of
such other Lender's required repayment to (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount
paid or payable by the purchasing Lender in respect of the total amount
so recovered. Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Subparagraph 2.09(b)
may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of setoff) with respect to such
participation as fully as if such Lender were the direct creditor of
Borrower in the amount of such participation.
2.10. Change of Circumstances.
(a) Inability to Obtain Funds, Determine Rates, Etc. If, on or
before the first day of any Interest Period for any LIBOR Borrowing or
LIBOR Portion, Agent shall determine (which determination shall be
conclusive and binding upon Borrower absent manifest error) that (i)
funds in Dollars are not readily available in the amounts necessary for
such Borrowing or Portion in the London interbank market, (ii) the LIBO
Rate for such Interest Period cannot be adequately and reasonably
determined due to other circumstances affecting the London interbank
market, or (iii) the rate of interest for such Borrowing or Portion does
not adequately and fairly reflect the cost to Lenders of making or
maintaining such Borrowing or Portion, Agent shall immediately give
notice of such condition to Borrower and the applicable Lenders. After
the giving of any such notice and until Agent shall otherwise notify
Borrower that the circumstances giving rise to such condition no longer
exist, Borrower's right to obtain, continue or convert to Borrowings or
Portions shall be suspended. Any LIBOR Borrowings or LIBOR Portions
outstanding at the commencement of any such suspension shall be repaid
at the end of the then current Interest Period for such Borrowings or
Portions unless such suspension has then ended.
(b) Illegality. If, after the date of this Agreement, the
adoption of any Governmental Rule, any change in any Governmental Rule
or the application or requirements thereof (whether such change occurs
in accordance with the terms of such Governmental Rule as enacted, as a
result of amendment or otherwise), any change in the interpretation or
administration of any Governmental Rule by any Governmental Authority,
or compliance by any Lender with any request or directive (whether or
not having the force of law) of any Governmental Authority (a "Change of
Law") shall make it unlawful or impossible for any Lender to make or
maintain any LIBOR Loan or LIBOR Portion in Dollars, such Lender shall
immediately notify Agent and Borrower of such Change of Law. Upon
receipt of such notice, (i) Borrower's right to obtain, continue or
convert to LIBOR Loans or LIBOR Portions shall be suspended until such
time as Agent shall notify Borrower and the applicable Lenders that the
circumstances giving rise to such suspension no longer exist, and (ii)
Borrower shall, if so requested by such Lender, immediately repay such
LIBOR Loans or LIBOR Portions if such Lender shall notify Borrower that
such Lender may not lawfully continue to fund and maintain such LIBOR
Loans or LIBOR Portions. Any prepayment of LIBOR Loans or LIBOR Portions
made pursuant to the preceding sentence prior to the last day of an
Interest Period for such LIBOR Loans or LIBOR Portions shall be deemed a
prepayment thereof for purposes of Paragraph 2.12.
(c) Increased Costs. If, after the date of this Agreement, any
Change of Law:
(i) Shall subject any Lender to any tax, duty or other
charge with respect to any LIBOR Loan or LIBOR Portion, or shall
change the basis of taxation of payments by Borrower to
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any such Lender on such a LIBOR Loan or LIBOR Portion, or in
respect to such a LIBOR Loan or LIBOR Portion, under this
Agreement (except for changes in the rate of taxation on the
overall net income of such Lender imposed by its jurisdiction of
incorporation or the jurisdiction of its Applicable Lending
Office); or
(ii) Shall impose, modify or hold applicable any reserve
(excluding any Reserve Requirement or other reserve to the extent
included in the calculation of the LIBO Rate for any Loans or
Portions), special deposit or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances or loans by, or any other acquisition of funds by any
Lender for any LIBOR Loan or LIBOR Portion; or
(iii) Shall impose on any Lender any other condition
related to any LIBOR Loan or LIBOR Portion or such Lender's
Commitments;
And the effect of any of the foregoing is to increase the cost to such
Lender of making, continuing or maintaining any such LIBOR Loan or LIBOR
Portion or its Commitments or to reduce any amount receivable by such
Lender hereunder; then Borrower shall from time to time, within ten (10)
Business Days after demand by such Lender, pay to such Lender additional
amounts sufficient to reimburse such Lender for such increased costs or
to compensate such Lender for such reduced amounts; provided, however,
that Borrower shall have no obligation to make any payment to any
demanding party under this Subparagraph 2.10(c) on account of any such
increased costs or reduced amounts unless Borrower receives notice of
such increased costs or reduced amounts from the demanding party within
twelve (12) months after they are incurred or realized. A certificate
executed by an officer of the applicable Lender setting forth in
reasonable detail the amount of such increased costs or reduced amounts,
submitted by such Lender to Borrower shall constitute prima facie
evidence of such costs or amounts. The obligations of Borrower under
this Subparagraph 2.10(c) shall survive the payment and performance of
the Obligations and the termination of this Agreement.
(d) Capital Requirements. If, after the date of this Agreement,
any Lender determines that (i) any Change of Law affects the amount of
capital required or expected to be maintained by such Lender or any
Person controlling such Lender (a "Capital Adequacy Requirement") and
(ii) the amount of capital maintained by such Lender or such Person
which is attributable to or based upon the Loans, the Commitments or
this Agreement must be increased as a result of such Capital Adequacy
Requirement (taking into account such Lender's or such Person's policies
with respect to capital adequacy), Borrower shall pay to such Lender or
such Person, within ten (10) Business Days after demand of such Lender,
such amounts as such Lender or such Person shall determine are necessary
to compensate such Lender or such Person for the increased costs to such
Lender or such Person of such increased capital; provided, however, that
Borrower shall have no obligation to make any payment to any demanding
party under this Subparagraph 2.10(d) on account of any such increased
costs unless Borrower receives notice of such increased costs from the
demanding party within twelve (12) months after they are incurred or
realized. A certificate executed by an officer of the applicable Lender
setting forth in reasonable detail the amount of such increased costs,
submitted by any Lender to Borrower shall constitute prima facie
evidence of such costs. The obligations of Borrower under this
Subparagraph 2.10(d) shall survive the payment and performance of the
Obligations and the termination of this Agreement.
(e) Mitigation. Any Lender which becomes aware of (i) any Change
of Law which will make it unlawful or impossible for such Lender to make
or maintain any LIBOR Loan or LIBOR Portion or (ii) any Change of Law or
other event or condition which will obligate Borrower to pay any amount
pursuant to Subparagraph 2.10(c) or Subparagraph 2.10(d) shall notify
Borrower and Agent thereof as promptly as practical. If any Lender has
given notice of any such Change of Law or other event or condition and
thereafter becomes aware that such Change of Law or other event or
condition has ceased to exist, such Lender shall notify Borrower and
Agent thereof as promptly as practical. Each Lender affected by any
Change of Law which makes it unlawful or impossible for such Lender to
make or maintain any LIBOR Loan or LIBOR Portion or to which Borrower is
obligated to pay any amount pursuant to Subparagraph 2.10(c) or
Subparagraph 2.10(d) shall use reasonable commercial efforts (including
changing the jurisdiction of its Applicable Lending Offices) to avoid
the effect of such Change of Law or to avoid or
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materially reduce any amounts which Borrower is obligated to pay
pursuant to Subparagraph 2.10(c) or Subparagraph 2.10(d) if, in the
reasonable opinion of such Lender, such efforts would not be
disadvantageous to such Lender or contrary to such Lender's normal
banking practices.
2.11. Taxes on Payments.
(a) Payments Free of Taxes. All payments made by Borrower under
this Agreement and the other Credit Documents shall be made free and
clear of, and, except as provided herein, without deduction or
withholding for or on account of, Non-Excluded Taxes. If any
Non-Excluded Taxes are required to be withheld from any amounts payable
to Agent or any Lender hereunder or under the other Credit Documents,
the amounts so payable to Agent or such Lender shall be increased to the
extent necessary to yield to Agent or such Lender (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable hereunder
at the rates or in the amounts specified in this Agreement and the other
Credit Documents. Whenever any Taxes are payable by Borrower, as
promptly as possible thereafter, Borrower shall send to Agent for its
own account or for the account of such Lender, as the case may be, a
certified copy of an original official receipt received by Borrower
showing payment thereof. If Borrower fails to pay any Non-Excluded Taxes
when due to the appropriate taxing authority or fails to remit to Agent
the required receipts or other required documentary evidence, Borrower
shall indemnify Agent and Lenders for any taxes (including interest or
penalties) that may become payable by Agent or any Lender as a result of
any such failure. The obligations of Borrower under this Subparagraph
2.11(a) shall survive the payment and performance of the Obligations and
the termination of this Agreement.
(b) Withholding Exemption Certificates. Each Lender which is not
organized under the laws of the United States of America or a state
thereof shall, on or prior to the Closing Date in the case of any such
Lender that is a Lender hereunder on the date hereof and on or prior to
the date any other Lender becomes a Lender hereunder, deliver to
Borrower and Agent two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224 (or successor applicable form), as the
case may be, certifying in each case that such Lender is entitled to
receive payments on its Loans under this Agreement from Borrower's
Applicable Payment Office for the account of such Lender's Domestic
Lending Office or Euro-Dollar Lending Office without deduction or
withholding of any United States federal income taxes. Each such Lender
further agrees (A) promptly to notify Borrower and Agent of any change
of circumstances (including any change in any treaty, law or regulation)
which would prevent such Lender from receiving such payments hereunder
without any deduction or withholding of such taxes and (B) if such
Lender is still legally entitled to do so, then on or before the date
that any certificate or other form delivered by such Lender under this
Subparagraph 2.11(b) expires, to deliver to Borrower and Agent a new
certificate or form, certifying that such Lender is entitled to receive
such payments under this Agreement without deduction or such taxes.
(c) Mitigation. If Agent or any Lender claims any additional
amounts to be payable to it pursuant to this Paragraph 2.11, such Person
shall use reasonable commercial efforts to file any certificate or
document requested in writing by Borrower reflecting a reduced rate of
withholding or to change the jurisdiction of an Applicable Lending
Office if the making of such a filing or such change in the jurisdiction
of an Applicable Lending Office would avoid the need for or materially
reduce the amount of any such additional amounts which may thereafter
accrue and if, in the reasonable opinion of such Person, in the case of
a change in the jurisdiction of an Applicable Lending Office, such
change would not be disadvantageous to such Person or contrary to such
Person's normal banking practices.
(d) Tax Returns. Nothing contained in this Paragraph 2.11 shall
require Agent or any Lender to make available any of its tax returns (or
any other information relating to its taxes which it deems to be
confidential).
(e) Lender Rate Contracts. Nothing contained in this Paragraph
2.11 shall override or supercede any term or provision of any Lender
Rate Contract regarding withholding taxes relating to Rate Contracts.
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2.12. Funding Loss Indemnification. If Borrower shall (a) repay, prepay
or convert any LIBOR Loan or LIBOR Portion on any day other than the last day of
an Interest Period therefor (whether a scheduled payment, an optional prepayment
or conversion, a mandatory prepayment or conversion, a payment upon acceleration
or otherwise), (b) fail to borrow any LIBOR Loan or LIBOR Portion after
delivering the Notice of Borrowing therefor to Agent (whether as a result of the
failure to satisfy any applicable conditions or otherwise), (c) fail to convert
any Portion of the Term Loan Borrowing into a LIBOR Portion in accordance with a
Notice of Term Loan Conversion delivered to Agent (whether as a result of the
failure to satisfy any applicable conditions or otherwise), or (d) fail to pay
when due any principal or interest on any LIBOR Loan or LIBOR Portion, Borrower
shall, within ten (10) Business Days after demand of such Lender, reimburse such
Lender for and hold such Lender harmless from all reasonable costs and losses
incurred by such Lender as a result of such repayment, prepayment, conversion or
failure; provided, however, that Borrower shall have no obligation to make any
payment to any demanding party under this Paragraph 2.12 on account of any such
costs or losses unless Borrower receive notice of such costs or losses from the
demanding party within twelve (12) months after they are incurred or realized.
Borrower understands that such costs and losses may include, without limitation,
losses incurred by a Lender as a result of funding and other contracts entered
into by such Lender to fund a LIBOR Loan or LIBOR Portion. Each Lender demanding
payment under this Paragraph 2.12 shall deliver to Borrower, with a copy to
Agent, a certificate setting forth the amount of costs and losses for which
demand is made, which certificate shall set forth in reasonable detail the
calculation of the amount demanded. Such a certificate so delivered to Borrower
shall constitute prima facie evidence of such costs and losses. The obligations
of Borrower under this Paragraph 2.12 shall survive the payment and performance
of the Obligations and the termination of this Agreement.
2.13. Security.
(a) Guaranties, Etc. The Obligations shall be secured by the
following:
(i) A Guaranty in the form of Exhibit D (the "Guaranty"),
duly executed by FIL and all Eligible Material Subsidiaries, with
such changes thereto as may be appropriate based on the law of
the applicable jurisdictions; and
(ii) A Pledge Agreement or Pledge Agreements, each in the
form of Exhibit E (individually a "Pledge Agreement"), duly
executed by FIL and any Subsidiary that directly owns the stock
of any Ineligible Material Subsidiaries, together with a Guaranty
executed by any such Subsidiary, with such changes thereto as may
be appropriate based on the law of the applicable jurisdictions;
provided, however, that (1) in lieu of providing a pledge of
stock of Flextronics Industrial (Shenzhen) Co. Ltd. by
Flextronics Singapore Pte Ltd., Borrower shall provide a pledge
of the stock of Flextronics Singapore Pte Ltd. and Flextronics
Singapore Pte Ltd. shall provide a Guaranty, (2) in lieu of
providing a pledge of the stock of Flextronics International
Sweden AB by F.L. Tronics Holdings AB and a pledge of the stock
of Kyrel EMS Oyj by Flextronics Holding Finland OY, Flextronics
Holdings UK Limited shall provide a Guaranty and pledge of the
stock of F.L. Tronics Holdings AB and (3) in lieu of providing a
pledge of the stock of Neutronics HTR Technikai
Rendszerszolgaltato Kft, FIL shall pledge the stock of
Flextronics International Gmbh.
(b) Changes in Material Subsidiaries.
(i) If, at any time after the date of this Agreement, any
Subsidiary of FIL that is not a Guarantor under the Guaranty
shall become an Eligible Material Subsidiary, Borrower promptly
shall deliver, or cause to be delivered, to Agent, within sixty
(60) days of any such event, (A) a Subsidiary Joinder in the form
of Attachment 1 to the Guaranty, appropriately completed and duly
executed by such Subsidiary, and (B) such other instruments,
agreements, certificates, opinions and documents as Agent may
reasonably request to secure, maintain, protect and evidence the
obligations of such Subsidiary under the Guaranty.
(ii) If, at any time after the date of this Agreement, any
Subsidiary of FIL that is a Guarantor under the Guaranty shall
cease to be an Eligible Material Subsidiary, Agent promptly
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shall release such Subsidiary from its obligations under the
Guaranty, subject to the completion by Borrower (and, if the
Equity Securities of such Subsidiary are owned directly by
another Subsidiary of FIL, by such other parent Subsidiary) of
such actions as may be necessary to grant to Agent, to the extent
provided in clause (iii) below, a perfected security interest in
the Equity Securities of such Subsidiary.
(iii) If, at any time after the date of this Agreement,
any Subsidiary of FIL shall become an Ineligible Material
Subsidiary, Borrower shall deliver, or cause to be delivered, to
Agent, within sixty (60) days of any such event, such
instruments, agreements, certificates, opinions and documents
(including Uniform Commercial Code financing statements) as Agent
may reasonably request to grant, perfect, maintain, protect and
evidence security interests in favor of Agent, for the benefit of
Agent and Lenders as security for the Obligations, in any and all
Equity Securities of such Subsidiary, to the extent such security
interests are not prohibited by any applicable Governmental Rule
and would not significantly increase the tax liability of FIL and
its Subsidiaries.
(iv) If, at any time after the date of this Agreement, any
Ineligible Material Subsidiary becomes an Eligible Material
Subsidiary, upon Borrower's compliance with Subparagraph
2.13(b)(i) above, Agent shall release the Equity Securities of
such Subsidiary from any Pledge Agreement previously delivered
with respect to such Subsidiary.
(c) Further Assurances. Borrower shall deliver, and shall cause
its Guarantors and their Subsidiaries to deliver, to Agent such other
pledge agreements, guaranties, guaranty supplements and other
instruments, agreements, certificates, opinions and documents (including
Uniform Commercial Code financing statements) as Agent may reasonably
request to implement the provisions of Subparagraph 2.13(a) and
otherwise to establish, maintain, protect and evidence the rights
provided to Agent, for the benefit of Agents and Lenders, pursuant to
the Security Documents. Borrower shall fully cooperate with Agent and
Lenders and perform all additional acts reasonably requested by Agent or
any Lender to effect the purposes of this Paragraph 2.13.
2.14. Replacement of Lenders. If any Lender shall (a) become a
Defaulting Lender more than one (1) time in a period of twelve (12) consecutive
months, (b) continue as a Defaulting Lender for more than three (3) Business
Days at any time, (c) suspend its obligation to make or maintain LIBOR Loans or
LIBOR Portions pursuant to Subparagraph 2.10(b) for a reason which is not
applicable to any other Lender or (d) demand any payment under Subparagraph
2.10(c), 2.10(d) or 2.10(a) for a reason which is not applicable to any other
Lender, then Agent may (or upon the written request of Borrower, shall) replace
such Lender (the "affected Lender"), or cause such affected Lender to be
replaced, with another lender (the "replacement Lender") satisfying the
requirements of an Assignee Lender under Subparagraph 8.05(c), by having the
affected Lender sell and assign all of its rights and obligations under this
Agreement and the other Credit Documents to the replacement Lender pursuant to
Subparagraph 8.05(c); provided, however, that if Borrower seeks to exercise such
right, it must do so within sixty (60) days after Borrower first knows or should
have known of the occurrence of the event or events giving rise to such right,
and neither Agent nor any Lender shall have any obligation to identify or locate
a replacement Lender for Borrower; and provided, further, that no Lender shall
be replaced under this Agreement unless such Lender is also replaced under the
FIL Credit Agreement. Upon receipt by any affected Lender of a written notice
from Agent stating that Agent is exercising the replacement right set forth in
this Paragraph 2.14, such affected Lender shall sell and assign all of its
rights and obligations under this Agreement and the other Credit Documents to
the replacement Lender pursuant to an Assignment Agreement and Subparagraph
8.05(c) for a purchase price equal to the sum of the principal amount of the
affected Lender's Loans so sold and assigned, all accrued and unpaid interest
thereon and its ratable share of all fees to which it is entitled.
SECTION III. CONDITIONS PRECEDENT.
3.01. Initial Conditions Precedent. The obligations of the applicable
Lenders to make the Loans comprising the initial Borrowing are subject to
receipt by Agent, on or prior to the Closing Date, of each item listed
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in Schedule 3.01, each in form and substance satisfactory to Agent and
each Lender, and with sufficient copies for, Agent and each Lender.
3.02. Conditions Precedent to Each Credit Event. The occurrence of each
Credit Event (including the initial Borrowing) is subject to the further
conditions that:
(a) Borrower shall have delivered to Agent the Notice of
Borrowing, Notice of Term Loan Conversion or Notice of Interest Period
Selection, as the case may be, for such Credit Event in accordance with
this Agreement; and
(b) On the date such Credit Event is to occur and after giving
effect to such Credit Event, the following shall be true and correct:
(i) The representations and warranties of Borrower and its
Subsidiaries set forth in Paragraph 4.01 and in the other Credit
Documents are true and correct in all material respects as if
made on such date (except for representations and warranties
expressly made as of a specified date, which shall be true as of
such date); and
(ii) No Default has occurred and is continuing or will
result from such Credit Event.
The submission by Borrower to Agent of each Notice of Borrowing, each Notice of
Term Loan Conversion (other than a notice for a conversion to a Base Rate
Portion) and each Notice of Interest Period Selection (other than a notice
selecting an Interest Period of one (1) month) shall be deemed to be a
representation and warranty by Borrower that each of the statements set forth
above in this Subparagraph 3.02(b) is true and correct as of the date of such
notice.
3.03. Covenant to Deliver. Borrower agrees (not as a condition but as a
covenant) to deliver to Agent each item required to be delivered to Agent as a
condition to the occurrence of any Credit Event if such Credit Event occurs.
Borrower expressly agrees that the occurrence of any such Credit Event prior to
the receipt by Agent of any such item shall not constitute a waiver by Agent or
any Lender of Borrower's obligation to deliver such item.
SECTION IV. REPRESENTATIONS AND WARRANTIES.
4.01. Borrower's Representations and Warranties. In order to induce
Agent and Lenders to enter into this Agreement, Borrower hereby represent and
warrant to Agent and Lenders as follows:
(a) Due Incorporation, Qualification, etc. Borrower and its
Subsidiaries (i) is a corporation duly organized, validly existing and,
in any jurisdiction in which such legal concept is applicable, in good
standing under the laws of its jurisdiction of organization; (ii) has
the power and authority to own, lease and operate its properties and
carry on its business as now conducted; and (iii) is duly qualified and
licensed to do business as a foreign corporation or branch in each
jurisdiction where the failure to be so qualified or licensed is
reasonably and substantially likely to have a Material Adverse Effect.
(b) Authority. The execution, delivery and performance by
Borrower, the Guarantors and their Subsidiaries of each Credit Document
executed, or to be executed, by such Person and the consummation of the
transactions contemplated thereby (i) are within the power of such
Person and (ii) have been duly authorized by all necessary actions on
the part of such Person.
(c) Enforceability. Each Credit Document executed, or to be
executed, by Borrower, the Guarantors and their Subsidiaries has been,
or will be, duly executed and delivered by such Person and constitutes,
or will constitute, a legal, valid and binding obligation of such
Person, enforceable against such Person in accordance with its terms,
except as limited by bankruptcy, insolvency or other laws of general
application relating to or affecting the enforcement of creditors'
rights generally and general principles of equity.
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(d) Non-Contravention. The execution and delivery by Borrower,
the Guarantors and their Subsidiaries of the Credit Documents executed
by such Person and the performance and consummation of the transactions
contemplated thereby do not (i) violate any Requirement of Law
applicable to such Person; (ii) violate any provision of, or result in
the breach or the acceleration of, or entitle any other Person to
accelerate (whether after the giving of notice or lapse of time or
both), any Contractual Obligation of such Person; or (iii) result in the
creation or imposition of any Lien (or the obligation to create or
impose any Lien) upon any property, asset or revenue of such Person
(except such Liens as may be created in favor of Agent pursuant to this
Agreement or the other Credit Documents).
(e) Approvals. No consent, approval, order or authorization of,
or registration, declaration or filing with, any Governmental Authority
or other Person (including the shareholders of any Person) is required
in connection with the execution and delivery of the Credit Documents
executed by Borrower, the Guarantors and their Subsidiaries the
performance or consummation of the transactions contemplated thereby.
(f) No Violation or Default. None of Borrower, the Guarantors and
their Subsidiaries is in violation of or in default with respect to (i)
any Requirement of Law applicable to such Person or (ii) any Contractual
Obligation of such Person (nor is there any waiver in effect which, if
not in effect, would result in such a violation or default), where, in
each case, such violation or default is reasonably and substantially
likely to have a Material Adverse Effect. Without limiting the
generality of the foregoing, none of Borrower, the Guarantors and their
Subsidiaries (A) has violated any Environmental Laws, (B) has any
liability under any Environmental Laws or (C) has received notice or
other communication of an investigation or, to the knowledge of
Borrower, the Guarantors or their Subsidiaries, is under investigation
by any Governmental Authority having authority to enforce Environmental
Laws, where such violation, liability or investigation is reasonably and
substantially likely to have a Material Adverse Effect. No Default has
occurred and is continuing.
(g) Litigation. No actions (including derivative actions), suits,
proceedings or investigations are pending or, to the knowledge of
Borrower, threatened against Borrower, the Guarantors or any of their
Subsidiaries at law or in equity in any court or before any other
Governmental Authority which (i) is reasonably and substantially likely
(alone or in the aggregate) to have a Material Adverse Effect or (ii)
seeks to enjoin, either directly or indirectly, the execution, delivery
or performance by Borrower, the Guarantors or any of their Subsidiaries
of the Credit Documents or the transactions contemplated thereby.
(h) Title; Possession Under Leases. Borrower and its Subsidiaries
own and have good and marketable title, or a valid leasehold interest
in, all their respective properties and assets as reflected in the most
recent Financial Statements delivered to Agent (except those assets and
properties disposed of in the ordinary course of business or otherwise
in compliance with this Agreement since the date of such Financial
Statements) and all respective assets and properties acquired by
Borrower and its Subsidiaries since such date (except those disposed of
in the ordinary course of business or otherwise in compliance with this
Agreement). Such assets and properties are subject to no Lien, except
for Permitted Liens.
(i) Financial Statements. The Financial Statements of FIL and its
Subsidiaries which have been delivered to Agent, (i) are in accordance
with the books and records of FIL and its Subsidiaries, which have been
maintained in accordance with good business practice; (ii) have been
prepared in conformity with GAAP; and (iii) fairly present in all
material respects the financial conditions and results of operations of
FIL and its Subsidiaries as of the date thereof and for the period
covered thereby. Neither FIL nor any of its Subsidiaries has any
Contingent Obligations, liability for taxes or other outstanding
obligations which are material in the aggregate, except as disclosed in
the audited Financial Statements of FIL dated March 31, 1999, furnished
by Borrower to Agent prior to the date hereof, or in the Financial
Statements delivered to Agent pursuant to clause (i) or (ii) of
Subparagraph 5.01(a), or except as permitted under Section 5 of this
Agreement.
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(j) Employee Benefit Plans.
(i) Based on the latest valuation of each Employee Benefit
Plan that Borrower or any ERISA Affiliate maintains or
contributes to, or has any obligation under (which occurred
within twelve months of the date of this representation), the
aggregate benefit liabilities of such plan within the meaning of
Section 4001 of ERISA did not exceed the aggregate value of the
assets of such plan. Neither Borrower nor any ERISA Affiliate has
any liability with respect to any post-retirement benefit under
any Employee Benefit Plan which is a welfare plan (as defined in
section 3(1) of ERISA), other than liability for health plan
continuation coverage described in Part 6 of Title I(B) of ERISA,
which liability for health plan contribution coverage is not
reasonably and substantially likely to have a Material Adverse
Effect.
(ii) Each Employee Benefit Plan complies, in both form and
operation, in all material respects, with its terms, ERISA and
the IRC, and no condition exists or event has occurred with
respect to any such plan which would result in the incurrence by
Borrower or any ERISA Affiliate of any material liability, fine
or penalty. Each Employee Benefit Plan, related trust agreement,
arrangement and commitment of Borrower or any ERISA Affiliate is
legally valid and binding and in full force and effect. No
Employee Benefit Plan is being audited or investigated by any
government agency or is subject to any pending or threatened
claim or suit. Neither Borrower nor any ERISA Affiliate nor any
fiduciary of any Employee Benefit Plan has engaged in a
prohibited transaction under section 406 of ERISA or section 4975
of the IRC.
(iii) Neither Borrower nor any ERISA Affiliate contributes
to or has any material contingent obligations to any
Multiemployer Plan. Neither Borrower nor any ERISA Affiliate has
incurred any material liability (including secondary liability)
to any Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under Section 4201 of
ERISA or as a result of a sale of assets described in Section
4204 of ERISA. Neither Borrower nor any ERISA Affiliate has been
notified that any Multiemployer Plan is in reorganization or
insolvent under and within the meaning of Section 4241 or Section
4245 of ERISA or that any Multiemployer Plan intends to terminate
or has been terminated under Section 4041A of ERISA.
(iv) All employer and employee contributions required by
any applicable Governmental Rule in connection with all Foreign
Plans have been made, or, if applicable, accrued, in accordance
with the country-specific accounting practices. The fair market
value of the assets of each funded Foreign Plan, the liability of
each insurer for any Foreign Plan funded through insurance or the
book reserve established for any Foreign Plan, together with any
accrued contributions, is sufficient to procure or provide for
the accrued benefit obligations, as of the date hereof, with
respect to all current and former participants in such Foreign
Plan according to the actuarial assumptions and valuations most
recently used to determine employer contributions to such Foreign
Plan, which actuarial assumptions are commercially reasonable.
Each Foreign Plan required to be registered has been registered
and has been maintained in good standing with applicable
Governmental Authorities. Each Foreign Plan reasonably complies
in all material respects with all applicable Governmental Rules.
(k) Other Regulations. No Borrower, Guarantor or Material
Subsidiary is subject to regulation under the Investment Company Act of
1940, the Public Utility Holding Company Act of 1935, the Federal Power
Act, the Interstate Commerce Act, any state public utilities code or any
other Governmental Rule that limits its ability to incur Indebtedness.
(l) Patent and Other Rights. Borrower and its Subsidiaries own,
license or otherwise have the full right to use, under validly existing
agreements, without known conflict with any rights of others, all
material patents, licenses, trademarks, trade names, trade secrets,
service marks, copyrights and all rights with respect thereto, which are
required to conduct their businesses as now conducted.
(m) Governmental Charges. Borrower and its Subsidiaries have
filed or caused to be filed all tax returns, reports and declarations
which are required to be filed by them. Borrower and its Subsidiaries
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have paid, or made provision for the payment of, all taxes and other
Governmental Charges which have or may have become due pursuant to said
returns or otherwise and all other indebtedness, except such
Governmental Charges or indebtedness, if any, which are being contested
in good faith and as to which adequate reserves (determined in
accordance with GAAP) have been provided or which are not reasonably and
substantially likely to have a Material Adverse Effect if unpaid.
(n) Margin Stock. Borrower does not own any Margin Stock which,
in the aggregate, would constitute a substantial part of the assets of
Borrower, and no proceeds of any Loan will be used to purchase or carry,
directly or indirectly, any Margin Stock or to extend credit, directly
or indirectly, to any Person for the purpose of purchasing or carrying
any Margin Stock.
(o) Subsidiaries, Etc. Schedule 4.01(o) (as updated on a
quarterly basis by Borrower in a written notice to Agent no later than
the date financial statements are required to be delivered pursuant to
Subparagraph 5.01(a)) sets forth each of FIL's Subsidiaries, its
jurisdiction of organization, the classes of its Equity Securities, the
number of shares of each such class issued and outstanding, the
percentages of shares of each such class owned directly or indirectly by
FIL and whether FIL owns such shares directly or, if not, the Subsidiary
of FIL that owns such shares. The only Material Subsidiaries on the date
of this Agreement are Flextronics International Marketing (L) Ltd.,
Flextronics International Latin America (L) Ltd., Flextronics
Manufacturing Mexico, S.A. de C.V., Kyrel EMS Oyj, Flextronics
Industrial (Shenzhen) Co. Ltd., Flextronics International GmbH,
Flextronics International Sweden AB and Neutronics HTR Technikai
Rendszerszolgaltato Kft. Borrower and each of the other Material
Subsidiaries is a Subsidiary of FIL.
(p) Solvency, Etc. Each of Borrower, the Guarantors and their
Material Subsidiaries is Solvent and, after the execution and delivery
of the Credit Documents and the consummation of the transactions
contemplated thereby, will be Solvent.
(q) No Withholding, Etc. No Borrower or Guarantor is required by
any Governmental Rule to make any deduction or withholding of any nature
whatsoever from any payment required to be made by Borrower or any or
Guarantor hereunder or under any other Credit Document. Neither this
Agreement nor any of the other Credit Documents is subject to any
registration or stamp tax or any other similar or like taxes payable in
any jurisdiction.
(r) Foreign Guarantors.
(i) No Immunities, etc. Each Guarantor is subject to civil
and commercial law with respect to its obligations under this
Agreement and the other Credit Documents, and the execution,
delivery and performance by each such Guarantor of any Credit
Documents constitute and will constitute private and commercial
acts and not public or governmental acts. Neither such Guarantor
nor any of its property, whether or not held for its own account,
has any immunity (sovereign or other similar immunity) from any
suit or proceeding, from jurisdiction of any court or from
set-off or any legal process (whether service or notice,
attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or other similar immunity) under
laws of the jurisdiction in which such Guarantor is organized and
existing in respect of its obligations under this Agreement and
the other Credit Documents. Each such Guarantor has waived every
immunity (sovereign or otherwise) to which it or any of its
properties would otherwise be entitled from any legal action,
suit or proceeding, from jurisdiction of any court and from
set-off or any legal process (whether service or notice,
attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or otherwise) under the laws of
the jurisdiction in which such Guarantor is organized and
existing in respect of its obligations under this Agreement and
the other Credit Documents. The waiver by each such Guarantor
described in the immediately preceding sentence is the legal,
valid and binding obligation of such Guarantor.
(ii) No Recordation Necessary. This Agreement and each of
the other Credit Documents executed by a Guarantor is in proper
legal form under the law of the jurisdiction in
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which such Guarantor is organized and existing for the
enforcement hereof or thereof against such Guarantor under the
law of such jurisdiction, and to ensure the legality, validity,
enforceability, priority or admissibility in evidence of this
Agreement and such other Credit Documents. It is not necessary to
ensure the legality, validity, enforceability, priority or
admissibility in evidence of this Agreement or any other Credit
Document executed by a Guarantor that this Agreement, any other
Credit Document or any other document be filed, registered or
recorded with, or executed or notarized before, any court or
other authority in the jurisdiction in which such Guarantor is
organized and existing or that any registration charge or stamp
or similar tax be paid on or in respect of this Agreement, any
other Credit Document or any other document, except for any such
filing, registration or recording, or execution or notarization,
as has been made or is not required to be made until this
Agreement, any other Credit Document or any other document is
sought to be enforced and for any charge or tax as has been
timely paid.
(iii) Exchange Controls. The execution, delivery and
performance by each of the Credit Documents executed by a
Guarantor is, under applicable foreign exchange control
regulations of the jurisdiction in which each Guarantor is
organized and existing, not subject to any notification or
authorization except (A) such as have been made or obtained or
(B) such as cannot be made or obtained until a later date
(provided any notification or authorization described in
immediately preceding clause (B) shall be made or obtained as
soon as is reasonably practicable).
(s) No Material Adverse Effect. No event has occurred and no
condition exists which is reasonably and substantially likely to have a
Material Adverse Effect.
(t) Year 2000 Compliance. All software, hardware, firmware,
equipment, goods and systems utilized by or material to the business of
Borrower and the Material Subsidiaries or their financial condition
properly perform date sensitive functions before, during and after the
year 2000.
(u) Accuracy of Information Furnished. The Credit Documents and
the other certificates, statements and information (excluding
projections) furnished to Agent or any Lender by or on behalf of
Borrower and its Subsidiaries in connection with the Credit Documents
and the transactions contemplated thereby, taken as a whole, do not
contain and will not contain any untrue statement of a material fact and
do not omit and will not omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading. All projections have been based upon
reasonable assumptions and represent, as of their respective dates of
presentations, Borrower's best estimates of the future performance of
Borrower and its Subsidiaries.
4.02. Reaffirmation. Borrower shall be deemed to have reaffirmed, for
the benefit of Lenders and Agent, each representation and warranty contained in
Paragraph 4.01 on and as of the date of each Credit Event (except for
representations and warranties expressly made as of a specified date, which
shall be true as of such date).
SECTION V. COVENANTS.
5.01. Affirmative Covenants. Until the termination of this Agreement and
the satisfaction in full by Borrower of all Obligations, Borrower will comply,
and will cause compliance, with the following affirmative covenants, unless
Required Lenders shall otherwise consent in writing:
(a) Financial Statements, Reports, etc. Borrower shall furnish to
Agent the following, each in such form and such detail as Agent or the
Required Lenders shall reasonably request:
(i) As soon as available and in no event later than sixty
(60) days after the last day of each fiscal quarter of FIL, a
copy of the Financial Statements of FIL and its Subsidiaries
(prepared on a consolidated basis) for such quarter and for the
fiscal year to date, certified by the chief financial officer,
treasurer or controller of FIL to present fairly in all material
respects the
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financial condition, results of operations and other information
reflected therein and to have been prepared in accordance with
GAAP (subject to normal year-end audit adjustments);
(ii) As soon as available and in no event later than
ninety (90) days after the close of each fiscal year of FIL, (A)
copies of the audited Financial Statements of FIL and its
Subsidiaries (prepared on a consolidated and consolidating basis)
for such year, audited by independent certified public
accountants of recognized national standing reasonably acceptable
to Agent, (B) copies of the unqualified opinions (or qualified
opinions reasonably acceptable to Agent) and (C) if available
from such accountants, certificates of such accountants to Agent
stating that in making the examination necessary for their
opinion they have reviewed this Agreement and have obtained no
knowledge of any Default which has occurred and is continuing, or
if, in the opinion of such accountants, a Default has occurred
and is continuing, a statement as to the nature thereof;
(iii) Contemporaneously with the quarterly and year-end
Financial Statements required by the foregoing clauses (i) and
(ii), a compliance certificate of the chief financial officer,
treasurer or controller of FIL and Borrower (a "Compliance
Certificate") which (A) states that no Default has occurred and
is continuing, or, if any such Default has occurred and is
continuing, a statement as to the nature thereof and what action
Borrower proposes to take with respect thereto; and (B) sets
forth, for the quarter or year covered by such Financial
Statements or as of the last day of such quarter or year (as the
case may be), the calculation of the financial ratios and tests
provided in the FIL Credit Agreement;
(iv) As soon as possible and in no event later than five
(5) Business Days after any officer of Borrower knows of the
occurrence or existence of (A) any Reportable Event under any
Employee Benefit Plan or Multiemployer Plan; (B) any actual or
threatened litigation, suits, claims or disputes against Borrower
or any of its Subsidiaries involving potential monetary damages
payable by Borrower or its Subsidiaries of $10,000,000 or more
(alone or in the aggregate); (C) any other event or condition
which is reasonably and substantially likely to have a Material
Adverse Effect; or (D) any Default; the statement of the chief
financial officer, treasurer or controller of Borrower setting
forth details of such event, condition or Default and the action
which Borrower proposes to take with respect thereto;
(v) As soon as available and in no event later than five
(5) Business Days after they are sent, made available or filed,
copies of (A) all registration statements and reports filed by
Borrower or any of its Affiliates with the United States
Securities and Exchange Commission (including, without
limitation, all 10-Q, 10-K and 8-K reports); and (B) all reports,
proxy statements and financial statements sent or made available
by Borrower or any of its Affiliates to its security holders;
(vi) As soon as possible and in no event later than (A)
sixty (60) days after the last day of each fiscal quarter (or
ninety (90) days in the case of the last fiscal quarter of each
fiscal year), written notice of any new Subsidiary acquired or
established directly or indirectly by FIL during such quarter,
any new Equity Securities of any existing Subsidiary acquired
directly or indirectly by FIL during such quarter or any other
change in the information set forth in Schedule 4.01(o) during
such quarter; and (B) ten (10) days after the date that any
entity becomes a Material Subsidiary, written notice setting
forth each Subsidiary of FIL that has become a Material
Subsidiary and indicating for each such new Material Subsidiary
whether such Material Subsidiary is an Eligible Material
Subsidiary or Ineligible Material Subsidiary; and
(vii) Such other instruments, agreements, certificates,
opinions, statements, documents and information relating to the
operations or condition (financial or otherwise) of FIL, Borrower
or their Subsidiaries, and compliance by Borrower with the terms
of this Agreement and the other Credit Documents as Agent may
from time to time reasonably request.
In lieu of furnishing to Agent hard copies of the quarterly Financial
Statements described in clause (i) above and the annual Financial
Statements and auditor's report described in clauses (ii)(A) and (ii)(B)
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above, Borrower may make such documents available to Lenders at its
website located at ▇▇▇.▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ and through the United States
Securities and Exchange Commission's ▇▇▇▇▇ system ("▇▇▇▇▇") or by
transmitting such documents electronically to Lenders. The Agent shall
provide to any Lender hard copies of such documents upon request if such
Lender does not have access to Borrower's website or ▇▇▇▇▇.
(b) Books and Records. Borrower and its Subsidiaries shall at all
times keep proper books of record and account which shall be complete
and correct in all material respects in accordance with GAAP.
(c) Inspections. Borrower and its Subsidiaries shall permit Agent
and each Lender, or any agent or representative thereof, upon reasonable
notice and during normal business hours, to visit and inspect any of the
properties and offices of Borrower and its Subsidiaries, to examine the
books and records of Borrower and its Subsidiaries and make copies
thereof and to discuss the affairs, finances and business of Borrower
and its Subsidiaries with, and to be advised as to the same by, their
officers, auditors and accountants, all at such times and intervals as
Agent or any Lender may reasonably request (which visits and inspections
shall be at the expense of Agent or such Lender unless a Default has
occurred and is continuing).
(d) Insurance. Borrower and its Subsidiaries shall (i) carry and
maintain insurance of the types and in the amounts customarily carried
from time to time during the term of this Agreement by others engaged in
substantially the same business as such Person and operating in the same
geographic area as such Person, including fire, public liability,
property damage and worker's compensation, (ii) carry and maintain each
policy for such insurance with financially sound insurers and (iii)
deliver to Agent from time to time, as Agent may request, schedules
setting forth all insurance then in effect.
(e) Governmental Charges and Other Indebtedness. Borrower and its
Subsidiaries shall promptly pay and discharge when due (i) all taxes and
other Governmental Charges prior to the date upon which penalties accrue
thereon, (ii) all indebtedness which, if unpaid, could become a Lien
upon the property of Borrower or its Subsidiaries and (iii) subject to
any subordination provisions applicable thereto, all other Indebtedness,
which in each case, if unpaid, is reasonably and substantially likely to
have a Material Adverse Effect, except such Indebtedness as may in good
faith be contested or disputed, or for which arrangements for deferred
payment have been made, provided that in each such case appropriate
reserves are maintained in accordance with GAAP.
(f) Use of Proceeds. Borrower shall use the proceeds of the Loans
only for the respective purposes set forth in Section II. Borrower shall
not use any part of the proceeds of any Loan, directly or indirectly,
for the purpose of purchasing or carrying any Margin Stock or for the
purpose of purchasing or carrying or trading in any securities under
such circumstances as to involve Borrower, any Lender or Agent in a
violation of Regulations T, U or X issued by the Federal Reserve Board.
(g) General Business Operations. Borrower and its Subsidiaries
shall (i) preserve and maintain its corporate existence and all of its
rights, privileges and franchises reasonably necessary to the conduct of
its business, (ii) conduct its business activities in compliance with
all Requirements of Law and Contractual Obligations applicable to such
Person and (iii) keep all property useful and necessary in its business
in good working order and condition, ordinary wear and tear excepted,
except, in each case, where any failure is not reasonably and
substantially likely to have a Material Adverse Effect.
(h) Pari Passu Ranking. Borrower shall take, or cause to be
taken, all actions necessary to ensure that the Obligations of Borrower
are and continue to rank at least pari passu in right of payment with
all other unsecured and unsubordinated Indebtedness of Borrower.
(i) Year 2000 Compatibility. Borrower shall, and shall cause the
Material Subsidiaries to, take all acts reasonably necessary to ensure
that all software, hardware, firmware, equipment, goods and systems
utilized by or material to their business operations or financial
condition will properly perform date sensitive functions before, during
and after the year 2000. At the request of Agent, Borrower shall provide
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to Agent such certifications or other evidence of compliance with this
Subparagraph 5.01(i) as Agent may from time to time require.
5.02. Negative Covenants. Until the termination of this Agreement and
the satisfaction in full by Borrower of all Obligations, Borrower will comply,
and will cause compliance, with the following negative covenants, unless
Required Lenders shall otherwise consent in writing:
(a) Indebtedness. Neither Borrower nor any of its Subsidiaries
shall create, incur, assume or permit to exist any Indebtedness except
for the following ("Permitted Indebtedness"):
(i) Indebtedness that is not secured by a Lien in any
asset or property of Borrower or any of its Subsidiaries;
(ii) Capital Leases;
(iii) Existing Secured Indebtedness; and
(iv) Other Indebtedness that is secured by a Lien in any
assets or property of any of the Borrower or any of its
Subsidiaries, provided that the aggregate principal amount of all
secured Indebtedness of FIL and its Subsidiaries, other than
Existing Secured Indebtedness of FIL and its Subsidiaries,
outstanding during any fiscal quarter of FIL does not exceed ten
percent (10%) of the consolidated assets of FIL and its
Subsidiaries on the last day of the immediately preceding fiscal
quarter.
(b) Liens. Neither Borrower nor any of its Subsidiaries shall
create, incur, assume or permit to exist any Lien on or with respect to
any of their assets or property of any character, whether now owned or
hereafter acquired, except for the following Liens ("Permitted Liens"):
(i) Liens that arise under Capital Leases;
(ii) Liens that secure only Indebtedness which
constitutes Permitted Indebtedness under clause
(iii) or clause (iv) of Subparagraph 5.02(a);
(iii) Liens in favor of Borrower or any Eligible Material
Subsidiary on all or part of the assets of
Subsidiaries of Borrower or Eligible Material
Subsidiary securing Indebtedness owing by
Subsidiaries of Borrower or Eligible Material
Subsidiary, as the case may be, to Borrower or to
such other Eligible Material Subsidiary;
(iv) Liens to secure taxes, assessments and other
government charges in respect of obligations not
overdue or Liens on properties to secure claims for
labor, material or supplies in respect of
obligations not overdue, or which are being
contested in good faith by appropriate proceedings
diligently conducted and with respect to which
adequate reserves are being maintained in
accordance with generally accepted accounting
principles so long as such Liens are not being
foreclosed;
(v) deposits or pledges made in connection with, or to
secure payment of, workmen's compensation,
unemployment insurance, old age pensions or other
social security obligations and good faith deposits
in connection with tenders, contracts or leases to
which Borrower or Subsidiary is a party or deposits
or pledges to secure, or in lieu of, surety,
penalty or appeal bonds, performance bonds or other
similar obligations;
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(vi) Liens of carriers, warehousemen, mechanics and
materialmen, and other like Liens on properties
which would not have a Material Adverse Effect and
are in respect of obligations not overdue, or which
are being contested in good faith by appropriate
proceedings diligently conducted and with respect
to which adequate reserves are being maintained in
accordance with generally accepted accounting
principles so long as such Liens are not being
foreclosed;
(vii) encumbrances on real property consisting of
easements, rights of way, zoning restrictions,
restrictions on the use of real property and
defects and irregularities in the title thereto,
landlord's or lessor's or lessee's Liens under
leases to which Borrower or a Subsidiary is a
party, and other minor Liens or encumbrances none
of which interferes materially with the use of the
property, which defects do not individually or in
the aggregate have a Material Adverse Effect;
(viii) Liens in favor of the Agent for the benefit of the
Lenders and the Agent under the Credit Documents;
(ix) Liens in favor of the agent for the benefit of the
lenders and the agent under the FIL Credit
Documents;
(x) Liens in favor of Ericsson Business Networks AB
under the Pledge Agreement dated March 27, 1997
between Ericsson and Flextronics Holdings AB; and
(xi) rights of third parties in equipment or inventory
consigned to, or otherwise owned by such third
party and which is being stored on property owned
or leased by, Borrower or a Subsidiary.
Provided, however, that the foregoing exceptions shall not permit any
Lien in any of the Collateral or in any other Equity Securities issued
by any Subsidiary of Borrower and owned by Borrower or any of its other
Subsidiaries, except for Liens in favor of Agent securing the
Obligations or pursuant to the FIL Credit Documents.
(c) Asset Dispositions. Neither Borrower nor any of its
Subsidiaries shall sell, lease, transfer or otherwise dispose of any of
their assets or property, whether now owned or hereafter acquired,
except for (i) assets or property sold, leased, transferred or otherwise
disposed of in the ordinary course of business for fair market value;
(ii) sales of accounts receivable in financing transactions, provided
that the aggregate principal amount of any accounts receivable sold in
any fiscal quarter of FIL shall not exceed thirty percent (30%) of the
aggregate principal amount of accounts receivable originated by FIL and
its Subsidiaries and remaining outstanding as of the last day of the
preceding fiscal quarter; and (iii) sales or transfers of assets or
property to any Borrower or Material Subsidiary for a purchase price
that is less than fair market value; provided, however, that the
foregoing exception shall not permit any sale, lease, transfer or other
disposition of any Collateral or of any other Equity Securities issued
by any Subsidiary of Borrower and owned by Borrower or any of its other
Subsidiaries, except for Liens in favor of Agent securing the
Obligations or pursuant to the FIL Credit Documents.
(d) Mergers, Acquisitions, Etc. Neither Borrower nor any of its
Subsidiaries shall consolidate with or merge into any other Person or
permit any other Person to merge into them, acquire any Person as a new
Subsidiary or acquire all or substantially all of the assets of any
other Person, except for the following:
(i) Borrower and its Subsidiaries may merge with each
other, provided that (A) in any such merger involving Borrower,
Borrower is the surviving corporation and (B) no Default has
occurred and is continuing on the date of, or will result after
giving effect to, any such merger; and
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(ii) Borrower and its Subsidiaries may acquire any Person
as a new Subsidiary or of all or substantially all of the assets
of any Person, provided that:
(A) No Default has occurred and is continuing on
the date of, or will result after giving effect to, any
such acquisition;
(B) Such Person is not primarily engaged in any
business substantially different from (1) the present
business of the acquiring Borrower or Subsidiary or (2)
any business reasonably related thereto; and
(C) Borrower or its Subsidiary possesses the power
to direct or cause the direction of the management and
policies of such Person.
(e) Investments. Neither Borrower nor any of its Subsidiaries
shall make any Investment except for the following:
(i) Investments permitted by the investment policy of FIL
set forth in Schedule 5.02(e) or, if any changes to the
investment policy of FIL are hereafter duly approved by the Board
of Directors of FIL, in any subsequent investment policy which is
the most recent investment policy delivered by FIL to Agent with
a certificate of FIL's chief financial officer to the effect that
such investment policy has been duly approved by FIL's Board of
Directors and is then in effect;
(ii) Investments listed in Schedule 5.02(e) existing on
the date of this Agreement;
(iii) Investments received by Borrower and its
Subsidiaries in connection with the bankruptcy or reorganization
of customers and suppliers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;
(iv) Investments by Borrower and the Material Subsidiaries
in each other;
(v) Investments consisting of loans to employees and
officers for travel, relocation and other similar expenses
incurred in the ordinary course of business;
(vi) Investments of Borrower and its Subsidiaries in
interest rate protection, currency swap and foreign exchange
arrangements, provided that all such arrangements are entered
into in connection with bona fide hedging operations and not for
speculation;
(vii) Deposit accounts;
(viii) Investments permitted by Subparagraph 5.02(d); and
(ix) Other Investments, provided that:
(A) No Default has occurred and is continuing on
the date of, or will result after giving effect to, any
such Investment; and
(B) The aggregate consideration paid by FIL and its
Subsidiaries for all such Investments in any fiscal year
does not exceed five percent (5%) of the total assets of
FIL and its Subsidiaries at the end of the preceding
fiscal year.
(f) Dividends, Redemptions, Etc. Neither Borrower nor any of its
Subsidiaries shall pay any dividends or make any distributions on its
Equity Securities; purchase, redeem, retire, defease or otherwise
acquire for value any of its Equity Securities; return any capital to
any holder of its Equity Securities as
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such; make any distribution of assets, Equity Securities, obligations or
securities to any holder of its Equity Securities as such; or set apart
any sum for any such purpose; except as follows:
(i) Borrower or any of its Subsidiaries may pay dividends
on its capital stock payable solely in such Person's own capital
stock, provided that, in the case of any such dividend payable by
an Ineligible Material Subsidiary, such dividend is delivered and
pledged to Agent to the extent required by Subparagraph 2.13(b);
and
(ii) Any Subsidiary of Borrower may pay dividends to or
repurchase its capital stock from Borrower.
(g) Change in Business. Neither Borrower nor any of its
Subsidiaries shall engage to any material extent, either directly or
indirectly, in any business substantially different from (i) their
present business or (ii) any business reasonably related thereto.
(h) Employee Benefit Plans.
(i) Neither Borrower nor any ERISA Affiliate shall (A)
adopt or institute any Employee Benefit Plan that is an employee
pension benefit plan within the meaning of Section 3(2) of ERISA,
(B) take any action which will result in the partial or complete
withdrawal, within the meanings of sections 4203 and 4205 of
ERISA, from a Multiemployer Plan, (C) engage or permit any Person
to engage in any transaction prohibited by section 406 of ERISA
or section 4975 of the IRC involving any Employee Benefit Plan or
Multiemployer Plan which would subject Borrower or any ERISA
Affiliate to any tax, penalty or other liability including a
liability to indemnify, (D) incur or allow to exist any
accumulated funding deficiency (within the meaning of section 412
of the IRC or section 302 of ERISA), (E) fail to make full
payment when due of all amounts due as contributions to any
Employee Benefit Plan or Multiemployer Plan, (F) fail to comply
with the requirements of section 4980B of the IRC or Part 6 of
Title I(B) of ERISA, or (G) adopt any amendment to any Employee
Benefit Plan which would require the posting of security pursuant
to section 401(a)(29) of the IRC, where singly or cumulatively,
the above would be reasonably and substantially likely to have a
Material Adverse Effect.
(ii) Neither Borrower nor any of its Subsidiaries shall
(A) engage in any transaction prohibited by any Governmental Rule
applicable to any Foreign Plan, (B) fail to make full payment
when due of all amounts due as contributions to any Foreign Plan
or (C) otherwise fail to comply with the requirements of any
Governmental Rule applicable to any Foreign Plan, where singly or
cumulatively, the above would be reasonably and substantially
likely to have a Material Adverse Effect.
(i) Transactions With Affiliates. Neither Borrower nor any of its
Subsidiaries shall enter into any Contractual Obligation with any
Affiliate (other than FIL, any other borrower under the FIL Credit
Agreement or one of their Subsidiaries) or engage in any other
transaction with any such Affiliate except upon terms at least as
favorable to Borrower or such Subsidiary as an arms-length transaction
with unaffiliated Persons, except as disclosed in the audited Financial
Statements of FIL dated March 31, 1999, furnished by Borrower to Agent
prior to the date hereof, or in the Financial Statements delivered to
Agent pursuant to clause (i) or (ii) of Subparagraph 5.01(a).
(j) Accounting Changes. Neither Borrower nor any of its
Subsidiaries shall change (i) their fiscal year (currently April 1
through March 31) or (ii) their accounting practices except as required
by GAAP.
(k) Burdensome Contractual Obligations. None of Borrower, the
Guarantors and any of their Subsidiaries will enter into any Contractual
Obligation (excluding this Agreement and the other Credit Documents)
that restricts the ability of any Subsidiary of FIL to pay or make
dividends or distributions in
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cash or kind, to make loans, advances or other payments of whatsoever
nature or to make transfers or distributions of all or any part of their
assets to Borrower or to any Subsidiary of such Subsidiary.
SECTION VI. DEFAULT.
6.01. Events of Default. The occurrence or existence of any one or more
of the following shall constitute an "Event of Default" hereunder:
(a) Non-Payment. Borrower shall (i) fail to pay when due any
principal of any Loan or (ii) fail to pay within three (3) Business Days
after the same becomes due any interest, fee or other payment required
under the terms of this Agreement or any of the other Credit Documents;
or
(b) Specific Defaults. Borrower or any of its Subsidiaries shall
fail to observe or perform any covenant, obligation, condition or
agreement set forth in Paragraph 5.02; or
(c) Other Defaults. Borrower or any of its Subsidiaries shall
fail to observe or perform any other covenant, obligation, condition or
agreement contained in this Agreement or the other Credit Documents and
such failure shall continue for fifteen (15) Business Days after the
earlier of (i) Borrower's written acknowledgement of such failure and
(ii) Agent's or any Lender's written notice to Borrower of such failure;
or
(d) Representations and Warranties. Any representation, warranty,
certificate, information or other statement (financial or otherwise)
made or furnished by or on behalf of Borrower to Agent or any Lender in
or in connection with this Agreement or any of the other Credit
Documents, or as an inducement to Agent or any Lender to enter into this
Agreement, shall be false, incorrect, incomplete or misleading in any
material respect when made (or deemed made) or furnished and either (i)
Agent or any Lender has delivered to Borrower written notice thereof and
such representation, warranty, certificate, information or other
statement cannot be remedied or (ii) such representation, warranty,
certificate, information or other statement continues to be false,
incorrect, incomplete or misleading in any material respect thirty (30)
days after the earlier of (A) Borrower's written acknowledgement that
such representation, warranty, certificate, information or other
statement was false, incorrect, incomplete or misleading in any material
respect and (B) Agent's or any Lender's written notice to Borrower that
such representation, warranty, certificate, information or other
statement was false, incorrect, incomplete or misleading in any material
respect; or
(e) Cross-Default. (i) Borrower or any of its Subsidiaries shall
fail to make any payment on account of any Indebtedness of such Person
(other than the Obligations) when due (whether at scheduled maturity, by
required prepayment, upon acceleration or otherwise) and such failure
shall continue beyond any period of grace provided with respect thereto,
if the amount of such Indebtedness exceeds $10,000,000 or the effect of
such failure is to cause, or permit the holder or holders thereof to
cause, Indebtedness of Borrower and its Subsidiaries (other than the
Obligations) in an aggregate amount exceeding $10,000,000 to become due
(whether at scheduled maturity, by required prepayment, upon
acceleration or otherwise); (ii) Borrower or any of its Subsidiaries
shall otherwise fail to observe or perform any agreement, term or
condition contained in any agreement or instrument relating to any
Indebtedness of such Person (other than the Obligations), or any other
event shall occur or condition shall exist, if the effect of such
failure, event or condition is to cause, or permit the holder or holders
thereof to cause, Indebtedness of Borrower and their Subsidiaries (other
than the Obligations) in an aggregate amount exceeding $10,000,000 to
become due (and/or to be secured by cash collateral); or (iii) any Event
of Default, as defined in the FIL Credit Agreement, shall occur, without
regard to any waiver of such Event of Default under the FIL Credit
Agreement; or
(f) Insolvency, Voluntary Proceedings. Borrower, FIL or any of
their Subsidiaries shall (i) apply for or consent to the appointment of
a receiver, trustee, liquidator or custodian of itself or of all or a
substantial part of its property, (ii) be unable, or admit in writing
its inability, to pay its debts generally as they mature, (iii) make a
general assignment for the benefit of its or any of its creditors, (iv)
become insolvent (as such term may be defined or interpreted under any
applicable statute), (v) commence a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to
itself
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or its debts under any bankruptcy, insolvency or other similar law now
or hereafter in effect or consent to any such relief or to the
appointment of or taking possession of its property by any official in
an involuntary case or other proceeding commenced against it, or (vi)
take any action for the purpose of effecting any of the foregoing; or
Borrower, FIL or any Material Subsidiary shall be dissolved or
liquidated in full or in part; or
(g) Involuntary Proceedings. Proceedings for the appointment of a
receiver, trustee, liquidator or custodian of FIL, Borrower or any of
their Subsidiaries or of all or a substantial part of the property
thereof, or an involuntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to FIL,
Borrower or any of their Subsidiaries or the debts thereof under any
bankruptcy, insolvency or other similar law now or hereafter in effect
shall be commenced and an order for relief entered or such proceeding
shall not be dismissed or discharged within sixty (60) days of
commencement; or
(h) Judgments. (i) One or more judgments, orders, decrees or
arbitration awards requiring Borrower and/or its Subsidiaries to pay an
aggregate amount of $10,000,000 or more (exclusive of amounts covered by
insurance issued by an insurer not an Affiliate of Borrower and
otherwise satisfying the requirements set forth in Subparagraph 5.01(d))
shall be rendered against Borrower and/or its Subsidiaries in connection
with any single or related series of transactions, incidents or
circumstances and the same shall not be satisfied, vacated or stayed for
a period of sixty (60) consecutive days; (ii) any judgment, writ,
assessment, warrant of attachment, tax lien or execution or similar
process shall be issued or levied against a substantial part of the
property of Borrower or any of its Subsidiaries and the same shall not
be released, stayed, vacated or otherwise dismissed within sixty (60)
days after issue or levy; or (iii) any other judgments, orders, decrees,
arbitration awards, writs, assessments, warrants of attachment, tax
liens or executions or similar processes which, alone or in the
aggregate, are reasonably and substantially likely to have a Material
Adverse Effect are rendered, issued or levied; or
(i) Credit Documents. Any Credit Document or any material term
thereof shall cease to be, or be asserted by Borrower or any of its
Subsidiaries not to be, a legal, valid and binding obligation of
Borrower or any of its Subsidiaries enforceable in accordance with its
terms; or
(j) Employee Benefit Plans. Any Reportable Event which
constitutes grounds for the termination of any Employee Benefit Plan by
the PBGC or for the appointment of a trustee by the PBGC to administer
any Employee Benefit Plan shall occur, or any Employee Benefit Plan
shall be terminated within the meaning of Title IV of ERISA or a trustee
shall be appointed by the PBGC to administer any Employee Benefit Plan;
or
(k) Change of Control. Any Change of Control shall occur; or
(l) Material Adverse Effect. Any event(s) or condition(s) which
is (are) reasonably and substantially likely to have a Material Adverse
Effect shall occur or exist.
6.02. Remedies. At any time after the occurrence and during the
continuance of any Event of Default (other than an Event of Default referred to
in Subparagraph 6.01(f) or 6.01(g)), Agent may, with the consent of the Required
Lenders, or shall, upon instructions from the Required Lenders, by written
notice to Borrower, (a) terminate the Commitments and the obligations of Lenders
to make Loans and/or (b) declare all outstanding Obligations payable by Borrower
to be immediately due and payable without presentment, demand, protest or any
other notice of any kind, all of which are hereby expressly waived, anything
contained herein or in the Notes to the contrary notwithstanding. Upon the
occurrence or existence of any Event of Default described in Subparagraph
6.01(f) or 6.01(g), immediately and without notice, (1) the Commitments and the
obligations of Lenders to make Loans shall automatically terminate and (2) all
outstanding Obligations payable by Borrower hereunder shall automatically become
immediately due and payable, without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived, anything contained
herein or in the Notes to the contrary notwithstanding. In addition to the
foregoing remedies, upon the occurrence or existence of any Event of Default,
Agent may exercise any other right, power or remedy available to it under any of
the Credit Documents or otherwise by law, either by suit in equity or by action
at law, or both.
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6.03. Lender Rate Contract Remedies. Notwithstanding any other provision
of this Section VI, each Lender or its Affiliate which has entered into a Lender
Rate Contract shall have the right, with prior notice to Agent, but without the
approval or consent of Agent or any other Lender, (a) to declare an event of
default, termination event or other similar event thereunder which will result
in the early termination of such Lender Rate Contract, (b) to determine net
termination amounts in accordance with the terms of such Lender Rate Contract
and to set-off amounts between Lender Rate Contracts of such Lender, and (c) to
prosecute any legal action against Borrower or its Subsidiaries to enforce net
amounts owing to such Lender or its Affiliate under such Lender Rate Contracts.
SECTION VII. THE AGENT AND RELATIONS AMONG LENDERS.
7.01. Appointment, Powers and Immunities. Each Lender hereby appoints
and authorizes Agent to act as its agent hereunder and under the other Credit
Documents with such powers as are expressly delegated to Agent by the terms of
this Agreement and the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement or in any
other Credit Document, be a trustee for any Lender or have any fiduciary duty to
any Lender. Notwithstanding anything to the contrary contained herein Agent
shall not be required to take any action which is contrary to this Agreement or
any other Credit Document or any applicable Governmental Rule. Neither Agent nor
any Lender shall be responsible to any other Lender for any recitals,
statements, representations or warranties made by Borrower or any of its
Subsidiaries contained in this Agreement or in any other Credit Document, for
the value, validity, effectiveness, genuineness, enforceability or sufficiency
of this Agreement or any other Credit Document or for any failure by Borrower or
any of its Subsidiaries to perform their respective obligations hereunder or
thereunder. Agent may employ agents and attorneys-in-fact and shall not be
responsible to any Lender for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Neither Agent nor any of
its directors, officers, employees, agents or advisors shall be responsible to
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Credit Document or in connection herewith or therewith,
except for its or their own gross negligence or willful misconduct. Except as
otherwise provided under this Agreement, Agent shall take such action with
respect to the Credit Documents as shall be directed by the Required Lenders.
7.02. Reliance by Agent. Agent shall be entitled to rely upon any
certificate, notice or other document (including any cable, telegram, facsimile
or telex) believed by it in good faith to be genuine and correct and to have
been signed or sent by or on behalf of the proper Person or Persons, and upon
advice and statements of legal counsel, independent accountants and other
experts selected by Agent with reasonable care. As to any other matters not
expressly provided for by this Agreement, Agent shall not be required to take
any action or exercise any discretion, but shall be required to act or to
refrain from acting upon instructions of the Required Lenders and shall in all
cases be fully protected by Lenders in acting, or in refraining from acting,
hereunder or under any other Credit Document in accordance with the instructions
of the Required Lenders, and such instructions of the Required Lenders and any
action taken or failure to act pursuant thereto shall be binding on all of
Lenders.
7.03. Defaults. Agent shall not be deemed to have knowledge or notice of
the occurrence of any Default unless Agent has received a written notice from a
Lender or Borrower, referring to this Agreement, describing such Default and
stating that such notice is a "Notice of Default". If Agent receives such a
notice of the occurrence of a Default, Agent shall give prompt notice thereof to
Lenders. Agent shall take such action with respect to such Default as shall be
reasonably directed by the Required Lenders; provided, however, that until Agent
shall have received such directions, Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default as it shall deem advisable in the best interest of Lenders.
7.04. Indemnification. Without limiting the Obligations of Borrower
hereunder, each Lender agrees to indemnify Agent, ratably in accordance with
their Proportionate Shares, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may at any time be imposed on, incurred
by or asserted against Agent in any way relating to or arising out of this
Agreement or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or the enforcement of any of the
terms hereof or thereof; provided, however, that no Lender shall be liable for
any of the foregoing to the extent they arise from Agent's gross negligence or
willful misconduct. Agent shall be fully justified in refusing to take or in
continuing to take any action hereunder unless it
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shall first be indemnified to its satisfaction by Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The obligations of each Lender under this
Paragraph 7.04 shall survive the payment and performance of the Obligations, the
termination of this Agreement and any Lender ceasing to be a party to this
Agreement (with respect to events which occurred prior to the time such Lender
ceased to be a Lender hereunder).
7.05. Non-Reliance. Each Lender represents that it has, independently
and without reliance on Agent, or any other Lender, and based on such documents
and information as it has deemed appropriate, made its own appraisal of the
business, prospects, management, financial condition and affairs of Borrower and
its Subsidiaries and its own decision to enter into this Agreement and agrees
that it will, independently and without reliance upon Agent or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own appraisals and decisions in taking or not taking
action under this Agreement. Neither Agent nor any of its affiliates nor any of
their respective directors, officers, employees, agents or advisors shall (a) be
required to keep any Lender informed as to the performance or observance by
Borrower or any of its Subsidiaries of the obligations under this Agreement or
any other document referred to or provided for herein or to make inquiry of, or
to inspect the properties or books of Borrower or any of its Subsidiaries; (b)
have any duty or responsibility to provide any Lender with any credit or other
information concerning Borrower or any of its Subsidiaries which may come into
the possession of Agent, except for notices, reports and other documents and
information expressly required to be furnished to Lenders by Agent hereunder; or
(c) be responsible to any Lender for (i) any recital, statement, representation
or warranty made by Borrower or any officer, employee or agent of Borrower in
this Agreement or in any of the other Credit Documents, (ii) the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any Credit Document, (iii) the value or sufficiency of the
Collateral or the validity or perfection of any of the liens or security
interests intended to be created by the Credit Documents, or (iv) any failure by
Borrower to perform its obligations under this Agreement or any other Credit
Document.
7.06. Resignation or Removal of Agent. Agent may resign at any time by
giving thirty (30) days prior written notice thereof to Borrower and Lenders,
and Agent may be removed at any time with or without cause by the Required
Lenders. Upon any such resignation or removal, the Required Lenders shall have
the right to appoint a successor Agent, which Agent, if not a Lender, shall be
reasonably acceptable to Borrower; provided, however, that Borrower shall have
no right to approve a successor Agent if a Default has occurred and is
continuing. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from the duties and obligations
thereafter arising hereunder. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Section VII shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as Agent.
7.07. Agent in its Individual Capacity. Agent and its affiliates may
make loans to, accept deposits from and generally engage in any kind of banking
or other business with Borrower and its Subsidiaries and affiliates as though
Agent were not Agent hereunder. With respect to Loans, if any, made by Agent in
its capacity as a Lender, Agent in its capacity as a Lender shall have the same
rights and powers under this Agreement and the other Credit Documents as any
other Lender and may exercise the same as though it were not Agent, and the
terms "Lender" or "Lenders" shall include Agent in its capacity as a Lender.
7.08. Co-Agents. The Co-Agents do not assume any responsibility or
obligation under this Agreement or any of the other Credit Documents or any
duties as agents for the Lenders. The title "Co-Agent" implies no fiduciary
responsibility on the part of any Co-Agent to any Person, and the use of such
title does not impose on any Co-Agent any duties or obligations under this
Agreement or any of the other Credit Documents.
SECTION VIII. MISCELLANEOUS.
8.01. Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or upon
Borrower, any Lender or Agent under this Agreement or the other Credit Documents
shall be in writing and faxed, mailed or delivered, if to Borrower or Agent, at
its respective facsimile number or address set forth below or, if to any Lender,
at the address or facsimile number specified for
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such Lender in Part B of Schedule I (or to such other facsimile number or
address for any party as indicated in any notice given by that party to the
other parties). All such notices and communications shall be effective (a) when
sent by an overnight courier service of recognized standing, on the second
Business Day following the deposit with such service; (b) when delivered by
hand, upon delivery; (c) when faxed, upon confirmation of receipt; or (d) by any
other means, upon receipt; provided, however, that any notice delivered to Agent
under Section II shall not be effective until received by Agent.
Agent: ABN AMRO Bank N.V.
Syndications Group
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
U.S.A.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax. No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy in each case to:
ABN AMRO Bank N.V.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Borrower: Flextronics International USA, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Treasurer
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax. No: (▇▇▇) ▇▇▇-▇▇▇▇
Each Notice of Borrowing, Notice of Interest Period Selection and Notice of Term
Loan Conversion shall be given by Borrower to Agent's New York office located at
the address referred to above during such office's normal business hours;
provided, however, that any such notice received by Agent after 11:00 a.m.
(California time) on any Business Day shall be deemed received by Agent on the
next Business Day. In any case where this Agreement authorizes notices,
requests, demands or other communications by Borrower to Agent or any Lender to
be made by telephone or facsimile, Agent or any Lender may conclusively presume
that anyone purporting to be a person designated in any incumbency certificate
or other similar document received by Agent or a Lender is such a person.
8.02. Expenses. Borrower agrees to pay on demand, whether or not any
Loan is made hereunder, (a) all reasonable fees and expenses, including
reasonable attorneys' fees and expenses, incurred by Agent in connection with
the syndication of the Loans, the preparation, negotiation, execution and
delivery of, and the exercise of its duties under, this Agreement and the other
Credit Documents, and the preparation, negotiation, execution and delivery of
amendments and waivers hereunder and thereunder and (b) all reasonable fees and
expenses, including reasonable attorneys' fees and expenses, incurred by Agent
and Lenders in the enforcement or attempted enforcement of any of the
Obligations or in preserving any of Agent's or Lenders' rights and remedies
(including, without limitation, all such fees and expenses incurred in
connection with any "workout" or restructuring affecting the Credit Documents or
the Obligations or any bankruptcy or similar proceeding involving Borrower or
any of its Subsidiaries). As used herein, the term "reasonable attorneys' fees
and expenses" shall include, without limitation, allocable costs and expenses of
Agent's and Lenders' in-house legal counsel and staff. The obligations of
Borrower under this Paragraph 8.02 shall survive the payment and performance of
the Obligations and the termination of this Agreement.
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8.03. Indemnification. To the fullest extent permitted by law, Borrower
agrees to protect, indemnify, defend and hold harmless Agent, Lenders and their
Affiliates and their respective directors, officers, employees, agents and
advisors ("Indemnitees") from and against any and all liabilities, losses,
damages or expenses of any kind or nature and from any suits, claims or demands
(including in respect of or for reasonable attorney's fees and other expenses)
arising on account of or in connection with any matter or thing or action or
failure to act by Indemnitees, or any of them, arising out of or relating to the
Credit Documents or any transaction contemplated thereby, including without
limitation any use by Borrower of any proceeds of the Loans, except to the
extent such liability arises from the willful misconduct or gross negligence of
such Indemnitee. Upon receiving knowledge of any suit, claim or demand asserted
by a third party that Agent or any Lender believes is covered by this indemnity,
Agent or such Lender shall give Borrower notice of the matter and an opportunity
to defend it, at Borrower's sole cost and expense, with legal counsel
satisfactory to Agent or such Lender, as the case may be. Agent or such Lender
may also require Borrower to defend the matter. Any failure or delay of Agent or
any Lender to notify Borrower of any such suit, claim or demand shall not
relieve Borrower of its obligations under this Paragraph 8.03 but shall reduce
such obligations to the extent of any increase in those obligations caused
solely by any such failure or delay which is unreasonable. The obligations of
Borrower under this Paragraph 8.03 shall survive the payment and performance of
the Obligations and the termination of this Agreement.
8.04. Waivers; Amendments. Any term, covenant, agreement or condition of
this Agreement or any other Credit Document may be amended or waived, and any
consent under this Agreement or any other Credit Document may be given, if such
amendment, waiver or consent is in writing and is signed by Borrower and the
Required Lenders (or Agent on behalf of the Required Lenders with the written
approval of the Required Lenders); provided, however that:
(a) Any amendment, waiver or consent which would (i) extend the
Revolver Termination Date or Term Loan Maturity Date, (ii) reduce any
fees or other amounts payable for the account of all Lenders hereunder
or extend the scheduled date for payment of any such fees or amounts,
(iii) amend this Paragraph 8.04, (iv) amend the definition of Required
Lenders or (v) release any substantial part of the Collateral or any
Guarantor (except for releases as provided in Paragraph 2.13), must be
in writing and signed or approved in writing by all Lenders;
(b) Any amendment, waiver or consent which would (i) reduce the
principal of or interest on the Loans or any fees or other amounts
payable for the account of all Lenders hereunder or extend the scheduled
date for payment of any such principal, interest, fees or amounts or
(ii) amend the definition of Required Lenders, must be in writing and
signed or approved in writing by all Lenders;
(c) Any amendment, waiver or consent which would increase or
decrease the Commitment of any Lender (except for a pro rata decrease in
the Commitments of all Lenders) must be in writing and signed by such
Lender; and
(d) Any amendment, waiver or consent which affects the rights or
obligations of Agent must be in writing and signed by Agent.
No failure or delay by Agent or any Lender in exercising any right under this
Agreement or any other Credit Document shall operate as a waiver thereof or of
any other right hereunder or thereunder nor shall any single or partial exercise
of any such right preclude any other further exercise thereof or of any other
right hereunder or thereunder. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
specific instance and for the specific purpose for which given.
8.05. Successors and Assigns.
(a) Binding Effect. This Agreement and the other Credit Documents
shall be binding upon and inure to the benefit of Borrower, Lenders,
Agent, all future holders of the Notes and their respective successors
and permitted assigns, except that Borrower may not assign or transfer
any of its rights or obligations under any Credit Document without the
prior written consent of Agent and each Lender.
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(b) Participations. Any Lender may at any time sell to one or
more banks or other financial institutions ("Participants")
participating interests in any Loan owing to such Lender, any Note held
by such Lender, any Commitment of such Lender or any other interest of
such Lender under this Agreement and the other Credit Documents. In the
event of any such sale by a Lender of participating interests, such
Lender's obligations under this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof, such
Lender shall remain the holder of its Notes for all purposes under this
Agreement and Borrower and Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement pursuant to which any
such sale is effected may require the selling Lender to obtain the
consent of the Participant in order for such Lender to agree in writing
to any amendment, waiver or consent of a type specified in clause
(a)(i), (a)(ii), (b)(i) or (c)(i) or Subparagraph (d) of Paragraph 8.04
but may not otherwise require the selling Lender to obtain the consent
of such Participant to any other amendment, waiver or consent hereunder.
Borrower also agrees that any Lender which has transferred any
participating interest in its Commitments or Loans shall,
notwithstanding any such transfer, be entitled to the full benefits
accorded such Lender under Paragraph 2.10, Paragraph 2.11, and Paragraph
2.13, as if such Lender had not made such transfer.
(c) Assignments. Any Lender may, at any time, sell and assign to
any other Lender or any Eligible Assignee (individually, an "Assignee
Lender") all or a portion of its rights and obligations under this
Agreement and the other Credit Documents (such a sale and assignment to
be referred to herein as an "Assignment") pursuant to an assignment
agreement in the form of Exhibit F (an "Assignment Agreement"), executed
by each Assignee Lender and such assignor Lender (an "Assignor Lender")
and delivered to Agent for its acceptance and recording in the Register;
provided, however, that:
(i) Without the written consent of Agent and, if no
Default has occurred and is continuing, Borrower (which consent
of Agent and Borrower shall not be unreasonably withheld), no
Lender may make any Assignment of its Commitment or Loans to any
Assignee Lender which is not, immediately prior to such
Assignment, a Lender hereunder or an Affiliate thereof;
(ii) Without the written consent of Agent and, if no
Default has occurred and is continuing, Borrower (which consent
of Agent and Borrower shall not be unreasonably withheld), no
Lender may make any Assignment of its Commitment or Loans to any
Assignee Lender if, after giving effect to such Assignment, the
Commitment or Term Loan of such Lender or such Assignee Lender
would be less than Ten Million Dollars ($10,000,000) (except that
a Lender may make an Assignment which reduces its Commitment or
Term Loan to zero without the written consent of Borrower and
Agent);
(iii) Without the written consent of Agent and, if no
Default has occurred and is continuing, Borrower (which consent
of Agent and Borrower shall not be unreasonably withheld), no
Lender may make any Assignment of its Commitment or Loans which
does not assign and delegate an equal pro rata interest in all
rights, duties and obligations of such Lender under this
Agreement and the other Credit Documents, including without
limitation the FIL Credit Agreement;
(iv) Any Assignor Lender which is, or which has an
Affiliate which is, a party to a Lender Rate Contract may not
make an Assignment of all of its Commitments or all of its Loans
to an Assignee Lender unless such Assignee Lender or its
Affiliate shall also assume all obligations of such Assignor
Lender or its Affiliate with respect to such Lender Rate
Contract.
Upon such execution, delivery, acceptance and recording of each
Assignment Agreement, from and after the Assignment Effective Date
determined pursuant to such Assignment Agreement, (A) each Assignee
Lender thereunder shall be a Lender hereunder with Commitments or Loans
as set forth on Attachment 1 to such Assignment Agreement (under the
caption "Commitments or Loans After Assignment") and shall have the
rights, duties and obligations of such a Lender under this Agreement and
the other Credit Documents, and (B) the Assignor Lender thereunder shall
be a Lender with Commitments or Loans as set forth on Attachment 1 to
such Assignment Agreement (under the caption "Commitments or Loans After
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Assignment"), or, if the Commitments or Loans of the Assignor Lender
have been reduced to zero, the Assignor Lender shall cease to be a
Lender and to have any obligation to make any Loan; provided, however,
that any such Assignor Lender which ceases to be a Lender shall continue
to be entitled to the benefits of any provision of this Agreement which
by its terms survives the termination of this Agreement. Each Assignment
Agreement shall be deemed to amend Schedule I to the extent, and only to
the extent, necessary to reflect the addition of each Assignee Lender,
the deletion of each Assignor Lender which reduces its Commitments or
Loans to zero, and the resulting adjustment of Commitments or Loans
arising from the purchase by each Assignee Lender of all or a portion of
the rights and obligations of an Assignor Lender under this Agreement
and the other Credit Documents. On or prior to the Assignment Effective
Date determined pursuant to each Assignment Agreement, Borrower, at its
own expense, shall, if requested by Assignee Lenders, execute and
deliver to Agent, in exchange for the surrendered Notes, if any, of the
Assignor Lender thereunder, new Notes to the order of each Assignee
Lender thereunder and, if the Assignor Lender is continuing as a Lender
hereunder, new Notes to the order of the Assignor Lender. The Notes
surrendered by the Assignor Lender shall be returned by Agent to
Borrower marked "replaced". Each Assignee Lender which becomes a Lender
and was not previously such a Lender hereunder shall, prior to becoming
such a Lender, deliver such certificates and other evidence as is
required by Subparagraph 2.11(b).
(d) Register. Agent shall maintain at its address referred to in
Paragraph 8.01 a copy of each Assignment Agreement delivered to it and a
register (the "Register") for the recordation of the names and addresses
of Lenders and the Commitments or Loans of each Lender from time to
time. The entries in the Register shall be conclusive in the absence of
manifest error, and Borrower, Agent and Lenders may treat each Person
whose name is recorded in the Register as the owner of the Commitments
or Loans recorded therein for all purposes of this Agreement. 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) Registration. Upon its receipt of an Assignment Agreement
executed by an Assignor Lender and an Assignee Lender (and, to the
extent required by Subparagraph 8.05(c), by Borrower and Agent) together
with payment to Agent by Assignor Lender of a registration and
processing fee of $3,000, Agent shall (i) promptly accept such
Assignment Agreement and (ii) on the Effective Date determined pursuant
thereto record the information contained therein in the Register and
give notice of such acceptance and recordation to Lenders and Borrower.
Agent may, from time to time at its election, prepare and deliver to
Lenders and Borrower a revised Schedule I reflecting the names,
addresses and respective Commitments or Loans of all Lenders then
parties hereto.
(f) Confidentiality. Subject to Paragraph 8.11, Agent and Lenders
may disclose the Credit Documents and any financial or other information
relating to Borrower, FIL or any Subsidiary to each other or to any
potential Participant or Assignee Lender.
(g) Pledges to Federal Reserve Banks. Notwithstanding any other
provision of this Agreement, any Lender may at any time assign all or a
portion of its rights under this Agreement and the other Credit
Documents to a Federal Reserve Bank. No such assignment shall relieve
the assigning Lender from its obligations under this Agreement and the
other Credit Documents.
8.06. Setoff; Security Interest.
(a) Setoff. In addition to any rights and remedies of Lenders
provided by law, each Lender shall have the right, with the prior
consent of Agent but without prior notice to or consent of Borrower, any
such notice and consent being expressly waived by Borrower to the extent
permitted by applicable law, upon the occurrence and during the
continuance of an Event of Default, to set-off and apply against the
Obligations of Borrower any amount owing from such Lender to Borrower.
The aforesaid right of set-off may be exercised by such Lender against
Borrower or against any trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, receiver or execution, judgment
or attachment creditor of Borrower or against anyone else claiming
through or against Borrower or such trustee in bankruptcy, debtor in
possession, assignee for the benefit of creditors, receiver, or
execution, judgment or attachment creditor, notwithstanding the fact
that such right of set-off may not have been exercised by such Lender at
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any prior time. Each Lender agrees promptly to notify Borrower after any
such set-off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such
set-off and application.
(b) Security Interest. As security for the Obligations, Borrower
hereby grants to Agent and each Lender, for the benefit of all Lenders,
a continuing security interest in any and all deposit accounts or moneys
of Borrower now or hereafter maintained with such Lender. Each Lender
shall have all of the rights of a secured party with respect to such
security interest.
8.07. No Third Party Rights. Nothing expressed in or to be implied from
this Agreement is intended to give, or shall be construed to give, any Person,
other than the parties hereto and their permitted successors and assigns
hereunder, any benefit or legal or equitable right, remedy or claim under or by
virtue of this Agreement or under or by virtue of any provision herein.
8.08. Partial Invalidity. If at any time any provision of this Agreement
is or becomes illegal, invalid or unenforceable in any respect under the law or
any jurisdiction, neither the legality, validity or enforceability of the
remaining provisions of this Agreement nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction shall
in any way be affected or impaired thereby.
8.09. Jury Trial. EACH OF BORROWER, LENDERS AND AGENT, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT.
8.10. Counterparts. This Agreement may be executed in any number of
identical counterparts, any set of which signed by all the parties hereto shall
be deemed to constitute a complete, executed original for all purposes.
8.11. Confidentiality. Neither any Lender nor Agent shall disclose to
any Person any information with respect to Borrower or any of its Subsidiaries
which is furnished pursuant to this Agreement or under the other Credit
Documents, except that any Lender or Agent may disclose any such information (a)
to its own directors, officers, employees, auditors, counsel and other advisors
and to its Affiliates; (b) to any other Lender or Agent; (c) which is otherwise
available to the public; (d) if required or appropriate in any report, statement
or testimony submitted to any Governmental Authority having or claiming to have
jurisdiction over such Lender or Agent; (e) if required in response to any
summons or subpoena; (f) in connection with any enforcement by Lenders and Agent
of their rights under this Agreement or the other Credit Documents or any
litigation among the parties relating to the Credit Documents or the
transactions contemplated thereby; (g) to comply with any Requirement of Law
applicable to such Lender or Agent; (h) to any Assignee Lender or Participant or
any prospective Assignee Lender or Participant, provided that such Assignee
Lender or Participant or prospective Assignee Lender or Participant agrees to be
bound by this Paragraph 8.11; or (i) otherwise with the prior consent of
Borrower; provided, however, that (i) any Lender or Agent served with any
summons or subpoena demanding the disclosure of any such information shall use
reasonable efforts to notify Borrower promptly of such summons or subpoena if
not prohibited by any Requirement of Law and, if requested by Borrower and not
disadvantageous to such Lender or Agent, to cooperate with Borrower in obtaining
a protective order restricting such disclosure, and (ii) any disclosure made in
violation of this Agreement shall not affect the obligations of Borrower and its
Subsidiaries under this Agreement and the other Credit Documents.
8.12. Consent to Jurisdiction. Borrower irrevocably submits to the
non-exclusive jurisdiction of the courts of the State of California and the
courts of the United States of America located in the Northern District of
California and agrees that any legal action, suit or proceeding arising out of
or relating to this Agreement or any of the other Credit Documents may be
brought against such party in any such courts. Final judgment against Borrower
in any such action, suit or proceeding shall be conclusive and may be enforced
in any other jurisdiction by suit on the judgment, a certified or exemplified
copy of which shall be conclusive evidence of the judgment, or in any other
manner provided by law. Nothing in this Subparagraph 8.12 shall affect the right
of Agent or any Lender to commence legal proceedings or otherwise ▇▇▇ Borrower
in any other appropriate jurisdiction, or concurrently in more than one
jurisdiction, or to serve process, pleadings and other papers upon Borrower in
any manner authorized by the laws of any such jurisdiction. Borrower agrees that
process served either personally or by registered mail
47
52
shall, to the extent permitted by law, constitute adequate service of process in
any such suit. Borrower irrevocably waives to the fullest extent permitted by
applicable law (a) any objection which it may have now or in the future to the
laying of the venue of any such action, suit or proceeding in any court referred
to in the first sentence above; (b) any claim that any such action, suit or
proceeding has been brought in an inconvenient forum; (c) its right of removal
of any matter commenced by any other party in the courts of the State of
California to any court of the United States of America; (d) any immunity which
it or its assets may have in respect of its obligations under this Agreement or
any other Credit Document from any suit, execution, attachment (whether
provisional or final, in aid of execution, before judgment or otherwise) or
other legal process; and (e) any right it may have to require the moving party
in any suit, action or proceeding brought in any of the courts referred to above
arising out of or in connection with this Agreement or any other Credit Document
to post security for the costs of Borrower or to post a bond or to take similar
action.
8.13. Usury. In no event shall any provision of this Agreement or any
other Credit Document ever obligate Borrower to pay or allow any Lender to
collect interest on any Loan or any other Obligation of Borrower hereunder at a
rate greater than the maximum non-usurious rate permitted by applicable law
(herein referred to as the "highest lawful rate"), or obligate Borrower to pay
any taxes, assessments, charges, insurance premiums or other amounts to the
extent that such payments, when added to the interest payable on the Loans or
any other Obligations, would be held to constitute the payment by Borrower of
interest at a rate greater than the highest lawful rate. This provision shall
control over any provision to the contrary. Without limiting the generality of
the foregoing, in the event the maturity of all or any part of the principal
amount of the Obligations of Borrower shall be accelerated for any reason, then
such principal amount so accelerated shall be credited with any interest
theretofore paid thereon in advance and remaining unearned at the time of such
acceleration. If, pursuant to the terms of this Agreement, any funds are applied
to the payment of any part of the principal amount of the Obligations of
Borrower prior to the maturity thereof, then (a) any interest which would
otherwise thereafter accrue on the principal amount so paid by such application
shall be canceled, and (b) the Obligations of Borrower remaining unpaid after
such application shall be credited with the amount of all interest, if any,
theretofore collected on the principal amount so paid by such application and
remaining unearned at the date of said application; and if the funds so applied
shall be sufficient to pay in full all the Obligations of Borrower, then the
Lenders shall refund to Borrower all interest theretofore paid thereon in
advance and remaining unearned at the time of such acceleration. Regardless of
any other provision in this Agreement or any other Credit Document, Borrower
shall not be required to pay any unearned interest on any Obligations or any
portion thereof, or be required to pay interest thereon at a rate in excess of
the highest lawful rate construed by courts having competent jurisdiction
thereof.
[The first signature page follows.]
48
53
IN WITNESS WHEREOF, Borrower, Agent, Co-Agents and Lenders have caused
this Agreement to be executed as of the day and year first above written.
BORROWER: FLEXTRONICS INTERNATIONAL USA, INC.
By: /s/ ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇
--------------------------
Title: Chief Financial Officer
--------------------------
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Treasurer
--------------------------
AGENT: ABN AMRO BANK N.V.,
As Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------
Title: Group Vice President
--------------------------
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Title: Assistant Vice President
--------------------------
DOCUMENTATION AGENT: BANKBOSTON, N.A.,
As Documentation Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
S-1
54
CO-AGENTS AND LENDERS: ABN AMRO BANK N.V.,
As a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------
Title: Group Vice President
--------------------------
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Title: Assistant Vice President
--------------------------
BANKBOSTON, N.A.,
As a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
BANK OF AMERICA, N.A.,
As a Co-Agent and as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
BANQUE NATIONALE DE PARIS,
As a Co-Agent and as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------
Title: Assistant Vice President
--------------------------
S-2
▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
As a Co-Agent and as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Industry Head
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
CITICORP USA, INC.
As a Co-Agent and as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
THE FUJI BANK LIMITED,
As a Lender
By: /s/ HIROMITSU UGAWA
--------------------------------
Name: Hiromitsu Ugawa
--------------------------
Title: Senior Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
▇-▇
▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ OF JAPAN,
As a Lender
By: /s/ ▇▇▇ ▇▇▇▇▇
--------------------------------
Name: ▇▇▇ ▇▇▇▇▇
--------------------------
Title: Senior Vice President
--------------------------
and Manager
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
THE ROYAL BANK OF SCOTLAND PLC,
As a Lender
By: /s/ ▇▇▇▇▇ ▇. STEFANGIG
--------------------------------
Name: ▇▇▇▇▇ ▇. Stefangig
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
SUMITOMO BANK, LIMITED,
As a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
Title: Vice President
--------------------------
By:
--------------------------------
Name:
--------------------------
Title:
--------------------------
S-4
57
SCHEDULE I
LENDERS
PART A - COMMITMENTS
LENDER COMMITMENT
------ ----------
ABN AMRO Bank N.V. $11,000,000
BankBoston, N.A. $11,000,000
Bank of America, N.A. $ 9,000,000
Banque Nationale de Paris $ 9,000,000
The Bank of Nova Scotia $ 9,000,000
Citicorp USA, Inc. $ 9,000,000
The Fuji Bank Limited $ 6,000,000
Industrial Bank of Japan $ 6,000,000
The Royal Bank of Scotland plc $ 6,000,000
Sumitomo Bank, Limited $ 4,000,000
-----------
TOTAL $80,000,000
I-1
58
PART B - ADDRESSES FOR NOTICES, ETC.
ABN AMRO BANK N.V.
Domestic Lending Office and Euro-Dollar Lending Office:
ABN AMRO Bank N.V.
1325 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
ABN AMRO Bank N.V.
1325 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Agency Services
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
ABN AMRO Bank N.V.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Credit Administration
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy of all notices to:
ABN AMRO Bank N.V.
San Francisco Representative ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
ABN AMRO Bank N.V.
New York, New York
RT/ABA No.: ▇▇▇▇▇▇▇▇▇
Account Name: ABN AMRO Bank N.V. CPU
Account No.: 650-001-1789-41
Reference: CPU 00433462 Flextronics International USA, Inc.
I-2
59
BANKBOSTON, N.A.
Domestic Lending Office and Euro-Dollar Lending Office:
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇, Loan Administrator
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇▇, Director
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
BankBoston, N.A.
Boston, MA
ABA No.: ▇▇▇-▇▇▇-▇▇▇
For further credit to: Credit Services
Account No.: 540-99647
Reference: Flextronics International USA, Inc.
Attention: HT & Svcs Adm 50
I-3
60
BANK OF AMERICA, N.A.
Domestic Lending Office and Euro-Dollar Lending Office:
Bank of America, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
Bank of America, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
Bank of America, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
Bank of America, N.A.
Dallas, TX
ABA No.: ▇▇▇▇▇▇▇▇▇
For further credit to: Credit Services---West
Account No.: 37-508-364-79
Reference: Flextronics/▇▇▇▇▇ ▇▇▇▇▇▇▇
I-4
61
THE BANK OF NOVA SCOTIA
Domestic Lending Office and Euro-Dollar Lending Office:
The Bank of Nova Scotia
Atlanta Agency
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
The Bank of Nova Scotia
Atlanta Agency
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
The Bank of Nova Scotia
San Francisco Agency
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇ ▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
The Federal Reserve Bank of New York
New York, New York
ABA No.: ▇▇▇-▇▇▇-▇▇▇
Account Name: The Bank of Nova Scotia, ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
For further account of: BNS San Francisco Agency Loan Servicing Account
Account No.: ▇▇▇▇▇▇▇
Reference: Flextronics International USA, Inc.
I-5
62
BANQUE NATIONALE DE PARIS
Domestic Lending Office and Euro-Dollar Lending Office:
Banque Nationale de Paris
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
Banque Nationale de Paris
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇
Vice President - Treasury
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
Banque Nationale de Paris
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
Banque Nationale de Paris, New York
ABA No.: ▇▇▇▇▇▇▇▇▇
Account Name: Banque Nationale de Paris, San Francisco
Account No.: 14334000176
Reference: Flextronics International USA, Inc.
Attention: ▇▇▇▇▇ ▇▇▇▇▇
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63
CITICORP USA, INC.
Domestic Lending Office and Euro-Dollar Lending Office:
Citicorp USA, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
Citicorp USA, Inc.
▇ ▇▇▇▇'▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇ Pinkett
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
Citicorp USA, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
Citibank N.A.
New York, New York
ABA No.: ▇▇▇-▇▇▇-▇▇▇
For further credit to: Technology
Account No.: ▇▇▇▇▇▇▇▇
Reference: Flextronics International USA, Inc.
I-7
64
THE FUJI BANK, LIMITED, LOS ANGELES AGENCY
Domestic Lending Office and Euro-Dollar Lending Office:
The Fuji Bank Limited, Los Angeles Agency
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
The Fuji Bank Limited, Los Angeles Agency
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
The Fuji Bank Limited, Los Angeles Agency
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Mano ▇▇▇▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
Bankers Trust Company, New York
New York, New York
ABA No.: ▇▇▇-▇▇▇-▇▇▇
Account name: The Fuji Bank Limited, Los Angeles
Account No.: 0440-2840
Reference: Flextronics International USA, Inc.
I-8
65
THE INDUSTRIAL BANK OF JAPAN, LIMITED
Domestic Lending Office and Euro-Dollar Lending Office:
The Industrial Bank of Japan, Limited
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ 94105
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
The Industrial Bank of Japan, Limited
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
The Industrial Bank of Japan, Limited
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ 94105
Attn: ▇▇▇ ▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
The Industrial Bank of Japan, Limited
New York, NY
ABA No. ▇▇▇-▇▇▇-▇▇▇
For further credit to: Flextronics International USA, Inc.
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Credit Administration #1 Dept.
I-9
66
THE ROYAL BANK OF SCOTLAND PLC
Domestic Lending Office and Euro-Dollar Lending Office:
The Royal Bank of Scotland plc
Wall Street Plaza
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Address for Notices of Borrowing, Notices of Interest Period Selection and
Notices of Term Loan Conversion:
The Royal Bank of Scotland plc
Wall Street Plaza
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇ Ext. 260
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Address for all other notices:
The Royal Bank of Scotland plc
Wall Street Plaza
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Wiring Instructions:
Citibank
New York, NY
ABA No.: ▇▇▇▇-▇▇▇▇-▇
For further credit to: The Royal Bank of Scotland
Account No.: ▇▇▇▇▇▇▇▇
Reference: Flextronics International USA, Inc.
Attn: DeQuar
I-10
67
SCHEDULE II
PRICING GRID
APPLICABLE MARGIN FOR LIBOR
BORROWINGS AND LIBOR
PORTIONS
APPLICABLE
MARGIN PRIOR TO AFTER
FOR SATISFYING SATISFYING
FIL'S BASE RATE PRICING PRICING
DEBT/ PRICING BORROWINGS REDUCTION REDUCTION
EBITDA PERIOD AND CAPITAL CAPITAL COMMITMENT FEE
RATIO LEVEL PORTIONS REQUIREMENT REQUIREMENT PERCENTAGE
----- ---------- ---------- ----------- ----------- ---------------
[less than] 1.00 1 0% 0.625% 0.475% 0.150%
[greater than or
equal to] 1.00,
[less than] 1.50 2 0% 0.750% 0.600% 0.175%
[greater than or
equal to] 1.50,
[less than] 2.00 3 0% 0.875% 0.725% 0.200%
[greater than or
equal to] 2.00,
[less than] 2.50 4 0% 1.000% 0.850% 0.200%
[greater than or
equal to] 2.50,
[less than] 3.00 5 0% 1.250% 1.100% 0.250%
[greater than or
equal to] 3.00 6 0% 1.500% 1.350% 0.300%
EXPLANATION
1. The Applicable Margin For Base Rate Borrowings, Base Rate Portions,
LIBOR Borrowings, LIBOR Portions and the Commitment Fee Percentage will
be set for each Pricing Period and will vary depending upon whether such
period is a Level 1 Period, a ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇
▇ Period, a Level 5 Period or a Level 6 Period and, in the case of LIBOR
Borrowings and LIBOR Portions, whether FIL has satisfied the Pricing
Reduction Capital Requirement.
2. The first Pricing Period, which commences on the date of this Agreement
and ends on December 31, 1999 will be a ▇▇▇▇▇ ▇ Period.
3. The second Pricing Period, which commences on January 1, 2000 and ends
on March 31, 2000, will be a ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇ ▇
Period, a Level 4 Period, a Level 5 Period or a Level 6 Period depending
upon FIL's Debt/EBITDA Ratio for the consecutive four-quarter period
ending on September 30, 1999.
4. Each Pricing Period thereafter will be a ▇▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇ ▇
▇▇▇▇▇▇, ▇ ▇▇▇▇▇ ▇ Period, a Level 4 Period, a Level 5 Period or a Level
6 Period depending upon FIL's Debt/EBITDA Ratio for the consecutive
four-quarter period ending on the last day of the quarter that ended one
quarter prior to the first day of such Pricing Period.
5. Examples:
(a) FIL's Debt/EBITDA Ratio is 1.76 for the consecutive
four-quarter period ending on September 30, 1999, and FIL did not satisfy
the Pricing Reduction Capital Requirement on September 30, 1999. The
Pricing Period of January 1, 2000 through March 31, 2000 will be a Level
3 Period, and the
II-1
68
Applicable Margin for LIBOR Borrowings and the LIBOR Portions
during such Pricing Period will be 0.875%.
(b) FIL's Debt/EBITDA Ratio is 1.10 for the consecutive
four-quarter period ending on December 31, 1999, and FIL did not satisfy
the Pricing Reduction Capital Requirement on December 31, 1999. The
Pricing Period of April 1, 2000 through June 30, 2000 will be a Level 2
Period, and the Applicable Margin for LIBOR Borrowings and the LIBOR
Portions during such Pricing Period will be 0.750%.
(c) FIL's Debt/EBITDA Ratio is 1.10 for the consecutive
four-quarter period ending on December 31, 1999, and FIL did satisfy the
Pricing Reduction Capital Requirement on December 31, 1999. The Pricing
Period of April 1, 2000 through June 30, 2000 will be a Level 2 Period,
and the Applicable Margin for LIBOR Borrowings and the LIBOR Portions
during such Pricing Period will be 0.600%.
II-2
69
SCHEDULE 3.01
INITIAL CONDITIONS PRECEDENT
A. PRINCIPAL CREDIT DOCUMENTS.
(1) The Credit Agreement, duly executed by Borrower, each Lender,
Agent, Documentation Agent and each Co-Agent;
(2) Such Revolving Notes as the Lenders shall request, each duly
executed by Borrower;
(3) The Guaranty, duly executed by FIL, each Eligible Material
Subsidiary, Flextronics Holdings UK Limited and Flextronics Singapore
Pte Ltd., with such changes thereto as may be appropriate based on the
law of the applicable jurisdictions; and
(4) Pledge Agreements of FIL, Flextronics International GmbH and
Flextronics Holdings UK Limited, each, duly executed by such Person,
with such changes thereto as may be appropriate based on the laws of the
applicable jurisdictions.
B. BORROWER CORPORATE DOCUMENTS.
(1) The Certificate of Incorporation of Borrower, certified as of
a recent date prior to the Closing Date by the Secretary of State of
California;
(2) A Certificate of Good Standing (or comparable certificate)
for Borrower, certified as of a recent date prior to the Closing Date by
the Secretary of State of California;
(3) A certificate of the Secretary or an Assistant Secretary of
Borrower, dated the Closing Date, certifying (a) that attached thereto
is a true and correct copy of the Bylaws of Borrower as in effect on the
Closing Date; (b) that attached thereto are true and correct copies of
resolutions duly adopted by the Board of Directors of Borrower and
continuing in effect, which (i) authorize the execution, delivery and
performance by Borrower of this Agreement and the other Credit Documents
executed or to be executed by Borrower and the consummation of the
transactions contemplated hereby and thereby and (ii) designate the
officers authorized so to execute, deliver and perform on behalf of FIL;
and (c) that there are no proceedings for the dissolution or liquidation
of Borrower; and
(4) A certificate of the Secretary or an Assistant Secretary of
Borrower, dated the Closing Date, certifying the incumbency, signatures
and authority of the officers of Borrower authorized to execute, deliver
and perform this Agreement, the other Credit Documents and all other
documents, instruments or agreements related thereto executed or to be
executed by Borrower.
C. OTHER MATERIAL SUBSIDIARY CORPORATE DOCUMENTS.
(1) The Certificate of Incorporation (or comparable certificate)
of each Eligible Material Subsidiary, any Subsidiary executing a Pledge
Agreement or a Guaranty, and any Subsidiary whose shares are being
pledged pursuant to a Pledge Agreement, certified as of a recent date
prior to the Closing Date by the Secretary of State (or comparable
public official) of its jurisdiction of incorporation (or, if any such
Subsidiary is organized under the laws of any jurisdiction outside the
United States, such other evidence as Agent may request to establish
that such Person is duly organized and existing under the laws of such
jurisdiction), together with an English translation thereof (if
appropriate);
(2) To the extent such jurisdiction has the legal concept of a
corporation being in good standing and a Governmental Authority in such
jurisdiction issues any evidence of such good standing, a Certificate of
Good Standing (or comparable certificate) for each Eligible Material
Subsidiary, any Subsidiary executing a Pledge Agreement of a Guaranty,
and any Subsidiary whose shares are being
3.01-1
70
pledged pursuant to a Pledge Agreement, certified as of a recent date
prior to the Closing Date by the Secretary of State (or comparable
public official) of its jurisdiction of incorporation (or, if any such
Person is organized under the laws of any jurisdiction outside the
United States, such other evidence as Agent may request to establish
that such Person is duly qualified to do business and in good standing
under the laws of such jurisdiction), together with an English
translation thereof (if appropriate);
(3) A certificate of the Secretary or an Assistant Secretary (or
comparable officer) of each Eligible Material Subsidiary, any Subsidiary
executing a Pledge Agreement or a Guaranty, and any Subsidiary whose
shares are being pledged pursuant to a Pledge Agreement, dated the
Closing Date, certifying (a) that attached thereto is a true and correct
copy of the Bylaws of such Subsidiary as in effect on the Closing Date
(or, if any such Subsidiary is organized under the laws of any
jurisdiction outside the United States, any comparable document provided
for in the respective corporate laws of that jurisdiction); (b) (except
in the case of a Subsidiary which is not executing any Credit Documents)
that attached thereto are true and correct copies of resolutions duly
adopted by the Board of Directors of such Subsidiary (or other
comparable enabling action) and continuing in effect, which (i)
authorize the execution, delivery and performance by such Person of the
Credit Documents to be executed by such Person and the consummation of
the transactions contemplated thereby and (ii) designate the officers,
directors and attorneys authorized so to execute, deliver and perform on
behalf of such Person; and (c) that there are no proceedings for the
dissolution or liquidation of such Person, together with a certified
English translation thereof (if appropriate); and
(4) A certificate of the Secretary or an Assistant Secretary (or
comparable officer) of each Eligible Material Subsidiary and any
Subsidiary executing a Pledge Agreement or a Guaranty, dated the Closing
Date, certifying the incumbency, signatures and authority of the
officers, directors and attorneys of such Person authorized to execute,
deliver and perform the Credit Documents to be executed by such Person,
together with a certified English translation thereof (if appropriate).
D. FINANCIAL STATEMENTS, FINANCIAL CONDITION, ETC.
(1) A copy of the audited consolidated and consolidating
Financial Statements of FIL and its Subsidiaries for the fiscal year
ended March 31, 1999, audited by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, together with a
copy of the unqualified opinion delivered by such accountants in
connection with such Financial Statements;
(2) A copy of the unaudited Financial Statements of FIL and its
Subsidiaries for the fiscal quarter ended September 24, 1999 and for the
fiscal year to such date (prepared on a consolidated and consolidating
basis), certified by the chief financial officer, treasurer, controller
or principal accounting officer of FIL to present fairly the financial
condition, results of operations and other information reflected therein
and to have been prepared in accordance with GAAP (subject to normal
year-end audit adjustments);
(3) A copy of the 10-K report filed by FIL with the Securities
and Exchange Commission for the fiscal year ended March 31, 1999;
(4) A copy of the 10-Q report filed by FIL with the Securities
and Exchange Commission for the quarter ended September 24, 1999;
(5) The consolidated plan and forecast of FIL and its
Subsidiaries for the fiscal year to end March 31, 2000 (reflecting among
other events the anticipated Borrowings under this Agreement), including
quarterly cash flow projections and quarterly projections of FIL's
compliance with the financial tests and ratios specified in the FIL
Credit Agreement; and
(6) Such other financial, business and other information
regarding FIL, Borrower or any of their Subsidiaries as Agent or any
Lender may reasonably request, including information as to possible
3.01-2
71
contingent liabilities, tax matters, environmental matters and
obligations for employee benefits and compensation.
E. COLLATERAL DOCUMENTS.
(1) The stock certificates representing all of the outstanding
capital stock of each Subsidiary pledged to Agent pursuant to a Pledge
Agreement and existing on the Closing Date, other than subsidiaries
whose stock is not in certificated form, together with undated stock
powers, duly executed by the Borrower or Subsidiary that owns such
stock, in blank and attached thereto;
(2) Any other items required by any applicable jurisdiction;
(3) Such other documents, instruments and agreements as Agents
may reasonably request to establish and perfect the Liens granted to
Agent or any Lender in this Agreement, the Security Documents and the
other Credit Documents; and
(4) Such other evidence as Agent may request to establish that
the Liens granted to Agent or any Lender in this Agreement, the Security
Documents and the other Credit Documents are perfected and prior to the
Liens of other Persons in the Collateral, except for any such Liens
which are expressly permitted by the Credit Agreement to be prior.
F. OPINIONS. Favorable written opinions from each of the following counsel for
Borrower and their Subsidiaries, each dated the Closing Date, addressed to Agent
for the benefit of Agent and Lenders, covering such legal matters as Agent may
reasonably request and otherwise in form and substance satisfactory to Agent:
(1) Fenwick & West, counsel for Borrower and its Subsidiaries;
(2) Bruckhaus ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Austrian counsel for
Borrower and its Subsidiaries;
(3) ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, English counsel for Borrower and its
Subsidiaries;
(4) ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ & Waselius, Finnish counsel for Borrower
and its Subsidiaries;
(5) Foo, Teo & Associates, Labuan counsel for Borrower and its
Subsidiaries;
(6) Cuesta Campos Y Asociados, S.C., Mexican counsel for Borrower
and its Subsidiaries;
(7) ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, Singapore counsel for Borrower and its
Subsidiaries; and
(8) Nordic Law, Swedish counsel for Borrower and its
Subsidiaries.
G. OTHER ITEMS.
(1) A duly completed and timely delivered Notice of Borrowing for
the applicable Borrowing;
(2) An organization chart for FIL, Borrower and their
Subsidiaries, setting forth the relationship among such Persons,
certified by the Secretary or an Assistant Secretary of FIL;
(3) Evidence of the amounts owing to the lenders and agent under
the Existing FIUI Credit Agreement on the Closing Date and instructions
for the payment of such amounts;
(4) A certificate of the Chief Financial Officer of Borrower,
addressed to Agent and dated the Closing Date, certifying that:
3.01-3
72
(a) The representations and warranties set forth in
Paragraph 4.01 and in the other Credit Documents are true and
correct in all material respects as of such date (except for such
representations and warranties made as of a specified date, which
shall be true as of such date); and
(b) No Default has occurred and is continuing as of
such date;
(5) All fees and expenses payable to Agent and Lenders on or
prior to the Closing Date (including all fees payable to Agent pursuant
to the Agent's Fee Letter);
(6) All fees and expenses of Agent's counsels through the Closing
Date; and
(7) Such other evidence as Agent or any Lender may reasonably
request to establish the accuracy and completeness of the
representations and warranties and the compliance with the terms and
conditions contained in this Agreement and the other Credit Documents.
3.01-4
73
EXHIBIT A
NOTICE OF REVOLVING LOAN BORROWING
[Date]
ABN AMRO Bank N.V.
as Agent
Syndications Group
1325 Avenue of the Americas, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇.▇.▇.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
1. Reference is made to that certain Credit Agreement, dated as of
October 27, 1999 (the "Credit Agreement"), among Flextronics International USA,
Inc. ("Borrower"), the financial institutions listed in Schedule I to the Credit
Agreement (the "Lenders") and ABN AMRO Bank N.V., as agent for Lenders (in such
capacity, "Agent"). Unless otherwise indicated, all terms defined in the Credit
Agreement have the same respective meanings when used herein.
2. Pursuant to Subparagraph 2.01(a) of the Credit Agreement, Borrower
hereby irrevocably requests a Revolving Loan Borrowing to be made upon the
following terms:
(a) The principal amount of such Borrowing is to be $__________;
(b) Such Borrowing is to consist of [Base Rate][LIBOR] Loans;
(c) If such Borrowing is to consist of LIBOR Loans, the initial
Interest Period for such Loans shall be __________ month[s]; and
(d) The date of such Borrowing is to be __________, ____.
3. Borrower hereby certifies to Lenders and Agent that, on the date of
this Notice of Revolving Loan Borrowing and after giving effect to the requested
Revolving Loan Borrowing:
(a) The representations and warranties of Borrower and their
Subsidiaries set forth in Paragraph 4.01 of the Credit Agreement and in
the other Credit Documents are true and correct in all material respects
as if made on such date (except for representations and warranties
expressly made as of a specified date, which shall be true as of such
date); and
(b) No Default has occurred and is continuing.
4. Please disburse the proceeds of the requested Revolving Loan
Borrowing to____________________________________________________________________
________________________________________________________________________________
_______________________________________________________________________________.
IN WITNESS WHEREOF, Borrower has executed this Notice of Revolving Loan
Borrowing on the date set forth above.
FLEXTRONICS INTERNATIONAL USA, INC.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
A-1
74
EXHIBIT B
NOTICE OF TERM LOAN BORROWING
[Date]
ABN AMRO Bank N.V.
as Agent
Syndications Group
1325 Avenue of the Americas, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇.▇.▇.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
1. Reference is made to that certain Credit Agreement, dated as of
October 27, 1999 (the "Credit Agreement"), among Flextronics International USA,
Inc. ("Borrower"), the financial institutions listed in Schedule I to the Credit
Agreement (the "Lenders") and ABN AMRO Bank N.V., as agent for Lenders (in such
capacity, "Agent"). Unless otherwise indicated, all terms defined in the Credit
Agreement have the same respective meanings when used herein.
2. Pursuant to Subparagraph 2.01(b) of the Credit Agreement, Borrower
hereby irrevocably requests the Term Loan Borrowing to be made on the Revolver
Termination Date upon the following terms:
(a) The principal amount of such Borrowing is to be $__________;
and
(b) Such Borrowing is to consist initially of the following
Portion[s] [specify for each Portion the initial amount and Type and for
each LIBOR Portion the initial Interest Period]:
Portion Portion Interest
Amount Type Period
$________ __________ __ month[s]
$________ __________ __ month[s]
$________ __________ __ month[s]
$________ __________ __ month[s]
3. Borrower hereby certifies to Lenders and Agent that, on the date of
this Notice of Term Loan Borrowing and after giving effect to the requested Term
Loan Borrowing:
(a) The representations and warranties of Borrower and its
Subsidiaries set forth in Paragraph 4.01 of the Credit Agreement and in
the other Credit Documents are true and correct in all material respects
as if made on such date (except for representations and warranties
expressly made as of a specified date, which shall be true as of such
date); and
(b) No Default has occurred and is continuing.
4. Please disburse the proceeds of the requested Term Loan Borrowing
first to Lenders in such amounts as may be necessary to repay the principal
amount of all Revolving Loans outstanding on the Revolver Termination Date and
the balance, if any, to .
IN WITNESS WHEREOF, Borrower has executed this Notice of Term Loan
Borrowing on the date set forth above.
B-1
75
FLEXTRONICS INTERNATIONAL USA, INC.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-2
76
EXHIBIT C(1)
REVOLVING LOAN NOTE
______________, ________ October __, 1999
FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby promises to pay
to the order of ____________________, a ____________________ ("Lender"), the
aggregate outstanding principal balance of all Revolving Loans made by Lender to
Borrower pursuant to the Credit Agreement referred to below (as amended from
time to time, the "Credit Agreement"), on or before the Revolver Termination
Date specified in the Credit Agreement; and to pay interest on said sum, or such
lesser amount, at the rates and on the dates provided in the Credit Agreement.
Borrower shall make all payments hereunder, for the account of Lender's
Applicable Lending Offices, to Agent as indicated in the Credit Agreement, in
Dollars as required by the Credit Agreement and in same day or immediately
available funds.
Borrower hereby authorizes Lender to record on the schedule(s) annexed
to this note the date and amount of each Revolving Loan, the Facility pursuant
to which made, and the date and amount of each payment or prepayment of
principal made by Borrower and agrees that all such notations shall constitute
prima facie evidence of the matters noted; provided, however, that the failure
of Lender to make any such notation shall not affect Borrower's obligations
hereunder.
This note is one of the Revolving Loan Notes referred to in the Credit
Agreement, dated as of October 27, 1999, among Borrower, Lender and the other
lenders from time to time parties thereto (collectively, the "Lenders") and ABN
AMRO, as agent for Lenders. This note is subject to the terms of the Credit
Agreement, including the rights of prepayment and the rights of acceleration of
maturity set forth therein. Terms used herein have the meanings assigned to
those terms in the Credit Agreement, unless otherwise defined herein.
The transfer, sale or assignment of any rights under or interest in this
note is subject to certain restrictions contained in the Credit Agreement,
including Paragraph 8.05 thereof.
C(1)-1
77
Borrower shall pay all reasonable fees and expenses, including
reasonable attorneys' fees, incurred by Lender in the enforcement or attempt to
enforce any of Borrower's obligations hereunder not performed when due. Borrower
hereby waives notice of presentment, demand, protest or notice of any other
kind. This note shall be governed by and construed in accordance with the laws
of the State of California.
FLEXTRONICS INTERNATIONAL USA, INC.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
C(1)-2
78
LOANS AND PAYMENTS OF PRINCIPAL
Amount of
Amount of Principal Paid
Date Loan or Prepaid
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C(1)-3
79
EXHIBIT C(2)
TERM LOAN NOTE
--------------, -------- ----------, ----
FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby promises to pay
to the order of ____________________, a ____________________ ("Lender"), the
principal amount of the Term Loan made by Lender to Borrower pursuant to the
Credit Agreement referred to below (as amended from time to time, the "Credit
Agreement"), in a single installment on the Term Loan Maturity Date specified in
the Credit Agreement; and to pay interest on said sum at the rates and on the
dates provided in the Credit Agreement.
Borrower shall make all payments hereunder, for the account of Lender's
Applicable Lending Offices, to Agent as indicated in the Credit Agreement, in
Dollars as required by the Credit Agreement and in same day or immediately
available funds.
This note is one of the Term Loan Notes referred to in the Credit
Agreement, dated as of October 27, 1999, among Borrower, Lender and the other
lenders from time to time parties thereto (collectively, the "Lenders") and ABN
AMRO, as agent for Lenders. This note is subject to the terms of the Credit
Agreement, including the rights of prepayment and the rights of acceleration of
maturity set forth therein. Terms used herein have the meanings assigned to
those terms in the Credit Agreement, unless otherwise defined herein.
The transfer, sale or assignment of any rights under or interest in this
note is subject to certain restrictions contained in the Credit Agreement,
including Paragraph 8.05 thereof.
C(2)-1
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Borrower shall pay all reasonable fees and expenses, including
reasonable attorneys' fees, incurred by Lender in the enforcement or attempt to
enforce any of Borrower's obligations hereunder not performed when due. Borrower
hereby waives notice of presentment, demand, protest or notice of any other
kind. This note shall be governed by and construed in accordance with the laws
of the State of California.
FLEXTRONICS INTERNATIONAL USA, INC.
By:
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Name:
---------------------------------
Title:
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C(2)-2
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EXHIBIT D
GUARANTY
THIS GUARANTY, dated as of October [_], 1999, is executed by each of the
undersigned (each such entity and each entity which hereafter executes and
delivers a Subsidiary Joinder in substantially the form of Attachment 1 hereto
to be referred to herein as a "Guarantor"), in favor of ABN AMRO BANK N.V.,
acting as agent (in such capacity, and each successor thereto in such capacity,
"Agent") for the financial institutions which are from time to time parties to
the Credit Agreement referred to in Recital A below (collectively, "Lenders").
RECITALS
A. Pursuant to a Credit Agreement dated as of October 27, 1999 (as
amended from time to time, the "Credit Agreement"), among Flextronics
International USA, Inc. ("Borrower"), Lenders and Agent, Lenders have agreed to
extend certain credit facilities to Borrower upon the terms and subject to the
conditions set forth therein. Each Guarantor (other than FIL) is a direct or
indirect Subsidiary of FIL and expects to derive substantial direct and indirect
benefit from the transactions contemplated by the Credit Agreement.
B. Lenders' obligations to extend the credit facilities to Borrower
under the Credit Agreement are subject, among other conditions, to receipt by
Agent of (1) this Guaranty, duly executed by each existing Eligible Material
Subsidiary, and (2) Subsidiary Joinders, duly executed by each future Eligible
Material Subsidiary.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, each Guarantor hereby agrees with Agent, for the ratable benefit
of Lenders and Agent, as follows:
1. DEFINITIONS AND INTERPRETATION.
(a) Definitions. When used in this Guaranty, the following terms
shall have the following respective meanings:
"Agent" shall have the meaning given to that term in the
introductory paragraph hereof.
"Aggregate Guaranty Payments" shall mean, with respect to
any Guarantor at any time, the aggregate net amount of all
payments made by such Guarantor under this Guaranty (including,
without limitation, under Paragraph 5 hereof) at or prior to such
time.
"Borrower" shall have the meaning given to that term in
the Recital A hereof.
"Credit Agreement" shall have the meaning given to that
term in the Recital A hereof.
"Debtor Relief Proceeding" shall mean any suit, action,
case or other proceeding commenced by, against or for any
Borrower or its property seeking the dissolution, liquidation,
reorganization, rearrangement or other relief of such Borrower or
its debts under any applicable bankruptcy, insolvency or debtor
relief law or other similar Governmental Rule now or hereafter in
effect or seeking the appointment of a receiver, trustee,
liquidator, custodian or other similar official for such Borrower
or any substantial part of its property or any general assignment
by any Borrower for the benefit of its creditors, whether or not
any such suit, action, case or other proceeding is voluntary or
involuntary.
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"Disallowed Post-Commencement Interest and Expenses" shall
mean interest computed at the rate provided in the Credit
Agreement and claims for reimbursement, costs, expenses or
indemnities under the terms of any of the Credit Documents
accruing or claimed at any time after the commencement of any
Debtor Relief Proceeding, if the claim for such interest,
reimbursement, costs, expenses or indemnities is not allowable,
allowed or enforceable against Borrowers in such Debtor Relief
Proceeding.
"Fair Share" shall mean, with respect to any Guarantor at
any time, an amount equal to (i) a fraction, the numerator which
is the Maximum Guaranty Amount of such Guarantor and the
denominator of which is the aggregate Maximum Guaranty Amounts of
all Guarantors, multiplied by (ii) the aggregate amount paid by
all Funding Guarantors under this Guaranty at or prior to such
time.
"FMM Process Agent" shall have the meaning given to that
term in Subparagraph 6(l)(iii) hereof.
"Fair Share Shortfall" shall mean, with respect to any
Guarantor at any time, the amount, if any, by which the Fair
Share of such Guarantor at such time exceeds the Aggregate
Guaranty Payments of such Guarantor at such time.
"FIL" shall have the meaning given to that term in the
Recital A hereof.
"Funding Guarantor" shall have the meaning given to that
term in Paragraph 5 hereof.
"Guaranteed Obligations" shall mean and include, with
respect to any Guarantor, all loans, advances, debts,
liabilities, and obligations, howsoever arising, owed by any
Borrower (other than such Guarantor in its capacity as a Borrower
if such Guarantor is a Borrower) to Agent or any Lender of every
kind and description (whether or not evidenced by any note or
instrument and whether or not for the payment of money)
individual or joint and several, direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter
arising pursuant to the terms of the Credit Documents, including
all interest, fees, charges, expenses, attorneys' fees and
accountants' fees chargeable to any Borrower or payable by any
Borrower thereunder.
"Guarantor" shall have the meaning given to that term in
the introductory paragraph hereof.
"Lenders" shall have the meaning given to that term in the
introductory paragraph hereof.
"Maximum Guaranty Amount" shall mean, with respect to any
Guarantor at any time, (i) the full amount of the Guaranteed
Obligations at such time or (ii) if any court of competent
jurisdiction determines in any action to enforce this Guaranty
that enforcement against such Guarantor for the full amount of
the Guaranteed Obligations is not lawful under or would be
subject to avoidance under ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Bankruptcy Code or any applicable provision of any comparable law
of any state or other jurisdiction, then the maximum amount
lawful and not subject to such avoidance.
"Mexican Guarantor" shall mean Flextronics Manufacturing
Mex, S.A. de C.V. and its successors or assigns.
"Subordinated Obligations" shall have the meaning given to
that term in Paragraph 4 hereof.
"Subsidiary Joinder" shall mean an instrument
substantially in the form of Attachment 1 hereto.
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"Taxes" shall have the meaning given to such term in
Subparagraph 6(h).
Unless otherwise defined herein, all other capitalized terms used herein
and defined in the Credit Agreement shall have the respective meanings
given to those terms in the Credit Agreement.
(b) Other Interpretive Provisions. The rules of construction set
forth in Section I of the Credit Agreement shall, to the extent not
inconsistent with the terms of this Guaranty, apply to this Guaranty and
are hereby incorporated by reference. Each Guarantor acknowledges
receipt of copies of the Credit Agreement and the other Credit
Documents.
2. GUARANTY.
(a) Payment Guaranty. Each Guarantor unconditionally guarantees
and promises to pay and perform as and when due, whether at stated
maturity, upon acceleration or otherwise, any and all of the Guaranteed
Obligations. If any Debtor Relief Proceeding relating to any Borrower is
commenced, each Guarantor further unconditionally guarantees and
promises to pay and perform, upon the demand of Agent, any and all of
the Guaranteed Obligations (including any and all Disallowed
Post-Commencement Interest and Expenses) in accordance with the terms of
the Credit Documents, whether or not such obligations are then due and
payable by any Guarantor and whether or not such obligations are
modified, reduced or discharged in such Debtor Relief Proceeding. This
Guaranty is a guaranty of payment and not of collection.
(b) Continuing Guaranty. This Guaranty is an irrevocable
continuing guaranty of the Guaranteed Obligations which shall continue
in effect until all obligations of Lenders to extend credit to all
Borrowers have terminated and all of the Guaranteed Obligations have
been fully paid. If any payment on any Guaranteed Obligation is set
aside, avoided or rescinded or otherwise recovered from Agent or any
Lender, such recovered payment shall constitute a Guaranteed Obligation
hereunder and, if this Guaranty was previously released or terminated,
it automatically shall be fully reinstated, as if such payment was never
made.
(c) Joint, Several and Independent Obligations. The liability of
each Guarantor hereunder is joint and several and is independent of the
Guaranteed Obligations. A separate action or actions may be brought and
prosecuted against each Guarantor for the full amount of the Guaranteed
Obligations irrespective of whether action is brought against any
Borrower, any other Guarantor or any other guarantor of the Guaranteed
Obligations or whether any Borrower, any other Guarantor or any other
guarantor of the Guaranteed Obligations is joined in any such action or
actions.
(d) Fraudulent Transfer Limitation. If, in any action to enforce
this Guaranty, any court of competent jurisdiction determines that
enforcement against any Guarantor for the full amount of the Guaranteed
Obligations is not lawful under or would be subject to avoidance under
▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code or any applicable
provision of any comparable law of any state or other jurisdiction, the
liability of such Guarantor under this Guaranty shall be limited to the
maximum amount lawful and not subject to such avoidance.
(e) Termination. Notwithstanding any termination of this Guaranty
in accordance with Paragraph 3 hereof, this Guaranty shall continue to
be in full force and effect and applicable to any Guaranteed Obligations
arising thereafter which arise because prior payments of Guaranteed
Obligations are rescinded or otherwise required to be surrendered by
Agent or any Lender after receipt.
3. AUTHORIZATIONS, WAIVERS, ETC.
(a) Authorizations. Each Guarantor authorizes Agent and Lenders,
in their discretion, without notice to such Guarantor, irrespective of
any change in the financial condition of any Borrower, such Guarantor,
any other Guarantor or any other guarantor of the Guaranteed Obligations
since the date hereof,
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and without affecting or impairing in any way the liability of
such Guarantor hereunder, from time to time to:
(i) Create new Guaranteed Obligations and renew,
compromise, extend, accelerate or otherwise change the time for
payment or performance of, or otherwise amend or modify the
Credit Documents or change the terms of the Guaranteed
Obligations or any part thereof, including increase or decrease
of the rate of interest thereon;
(ii) Take and hold security for the payment or performance
of the Guaranteed Obligations and exchange, enforce, waive or
release any such security; apply such security and direct the
order or manner of sale thereof; and purchase such security at
public or private sale;
(iii) Otherwise exercise any right or remedy they may have
against any Borrower, such Guarantor, any other Guarantor, any
other guarantor of the Guaranteed Obligations or any security,
including, without limitation, the right to foreclose upon any
such security by judicial or nonjudicial sale;
(iv) Settle, compromise with, release or substitute any
one or more makers, endorsers or guarantors of the Guaranteed
Obligations; and
(v) Assign the Guaranteed Obligations, this Guaranty or
the other Credit Documents in whole or in part to the extent
provided in the Credit Agreement and the other Credit Documents.
(b) Waivers. Each Guarantor hereby waives:
(i) Any right to require Agent or any Lender to (A)
proceed against any Borrower, any other Guarantor or any other
guarantor of the Guaranteed Obligations, (B) proceed against or
exhaust any security received from any Borrower, such Guarantor,
any other Guarantor or any other guarantor of the Guaranteed
Obligations or otherwise marshal the assets of any Borrower, such
Guarantor, any other Guarantor or any other guarantor of the
Guaranteed Obligations or (C) pursue any other remedy in Agent's
or any Lender's power whatsoever;
(ii) Any defense arising by reason of the application by
any Borrower of the proceeds of any borrowing;
(iii) Any defense resulting from the absence, impairment
or loss of any right of reimbursement, subrogation, contribution
or other right or remedy of Guarantor against any Borrower, any
other Guarantor, any other guarantor of the Guaranteed
Obligations or any security, whether resulting from an election
by Agent or any Lender to foreclose upon security by nonjudicial
sale, or otherwise;
(iv) Any setoff or counterclaim of any Borrower or any
defense which results from any disability or other defense of any
Borrower or the cessation or stay of enforcement from any cause
whatsoever of the liability of any Borrower (including, without
limitation, the lack of validity or enforceability of any of the
Credit Documents);
(v) Any defense based upon any law, rule or regulation
which provides that the obligation of a surety must not be
greater or more burdensome than the obligation of the principal;
(vi) Until all obligations of Agent or any Lender to
extend credit to all Borrowers have terminated and all of the
Guaranteed Obligations have been fully paid, any right of
subrogation, reimbursement, indemnification or contribution and
other similar right to enforce any remedy which Agent, Lenders or
any other Person now has or may hereafter have against any
Borrower on account of the Guaranteed Obligations, and any
benefit of, and any right to
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participate in, any security now or hereafter received by Agent,
any Lender or any other Person on account of the Guaranteed
Obligations;
(vii) All presentments, demands for performance, notices
of non-performance, notices delivered under the Credit Documents,
protests, notice of dishonor, and notices of acceptance of this
Guaranty and of the existence, creation or incurring of new or
additional Guaranteed Obligations and notices of any public or
private foreclosure sale;
(viii) The benefit of any statute of limitations to the
extent permitted by law;
(ix) Any appraisement, valuation, stay, extension,
moratorium redemption or similar law or similar rights for
marshalling;
(x) Any right to be informed by Agent or any Lender of the
financial condition of any Borrower, any other Guarantor or any
other guarantor of the Guaranteed Obligations or any change
therein or any other circumstances bearing upon the risk of
nonpayment or nonperformance of the Guaranteed Obligations;
(xi) Until all obligations of Agent or any Lender to
extend credit to any Borrower have terminated and all of the
Guaranteed Obligations have been fully paid, any right to revoke
this Guaranty;
(xii) Any defense arising from an election for the
application of Section 1111(b)(2) of the United States Bankruptcy
Code which applies to the Guaranteed Obligations;
(xiii) Any defense based upon any borrowing or grant of a
security interest under Section 364 of the United States
Bankruptcy Code; and
(xiv) Any right it may have to a fair value hearing to
determine the size of a deficiency judgment following any
foreclosure on any security for the Guaranteed Obligations.
Without limiting the scope of any of the foregoing provisions of this
Paragraph 3, each Guarantor hereby further waives (A) all rights and
defenses arising out of an election of remedies by Agent or any Lender,
even though that election of remedies, such as a nonjudicial foreclosure
with respect to security for a Guaranteed Obligation, has destroyed such
Guarantor's rights of subrogation and reimbursement against any Borrower
by the operation of Section 580d of the Code of Civil Procedure or
otherwise, (B) all rights and defenses such Guarantor may have by reason
of protection afforded to any Borrower with respect to the Guaranteed
Obligations pursuant to the antideficiency or other laws of California
limiting or discharging the Guaranteed Obligations, including, without
limitation, Section 580a, 580b, 580d, or 726 of the California Code of
Civil Procedure, and (C) all other rights and defenses available to such
Guarantor by reason of Sections 2787 to 2855, inclusive, Section 2899 or
Section 3433 of the California Civil Code or Section 3605 of the
California Commercial Code.
(c) The Mexican Guarantor hereby expressly agrees that any rights
or privileges that it might have under the laws of Mexico shall not be
applicable to this Guaranty, including, but not limited to, any benefit
of "orden," "excusion," "division," "quita," "novacion," "prorroga,"
"espera" or "modificacion," provided in Articles 2813, 2814, 2816, 2817,
2818, 2820, 2821, 2822, 2823, 2827, 2836, 2840, 2842, 2844, 2845, 2846,
2847, 2848, and 2849 of the Civil Code of the Federal District of Mexico
and the corresponding articles of the Civil Codes in all States of the
United Mexican States ("Mexico"), which are not reproduced herein by
express declaration that the contents of such articles are known to the
Mexican Guarantor.
(d) Financial Condition of Borrower, Etc. Each Guarantor is fully
aware of the financial condition and affairs of Borrower. Each Guarantor
has executed this Guaranty without reliance upon any representation,
warranty, statement or information concerning Borrower furnished to such
Guarantor by
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Agent or any Lender and has, independently and without reliance
on Agent or any Lender, and based on such documents and information as
it has deemed appropriate, made its own appraisal of the financial
condition and affairs of each Borrower and of other circumstances
affecting the risk of nonpayment or nonperformance of the Guaranteed
Obligations. Each Guarantor is in a position to obtain, and assumes full
responsibility for obtaining, any additional information about the
financial condition and affairs of each Borrower and of other
circumstances affecting the risk of nonpayment or nonperformance of the
Guaranteed Obligations and will, independently and without reliance upon
Agent or any Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own appraisals
and decisions in taking or not taking action in connection with this
Guaranty.
4. SUBORDINATION. Each Guarantor hereby subordinates any and all debts,
liabilities and obligations owed to such Guarantor by Borrower (the
"Subordinated Obligations") to the Guaranteed Obligations as provided in this
Paragraph 4.
(a) Prohibited Payments, Etc. Except during the continuance of a
Default (including the commencement and continuation of any Debtor
Relief Proceeding relating to Borrower), each Guarantor may receive
regularly scheduled payments from Borrower on account of Subordinated
Obligations. After the occurrence and during the continuance of any
Default (including the commencement and continuation of any Debtor
Relief Proceeding relating to Borrower), however, unless Agent otherwise
agrees, no Guarantor shall demand, accept or take any action to collect
any payment on account of the Subordinated Obligations.
(b) Prior Payment of Guaranteed Obligations. In any Debtor Relief
Proceeding relating to any Borrower, each Guarantor agrees that Agent
and Lenders shall be entitled to receive payment of all Guaranteed
Obligations (including any and all Disallowed Post-Commencement Interest
and Expenses) before such Guarantor receives payment of any Subordinated
Obligations.
(c) Turn-Over. After the occurrence and during the continuance of
any Default (including the commencement and continuation of any Debtor
Relief Proceeding relating to Borrower), each Guarantor shall, if Agent
so requests, collect, enforce and receive payments on account of the
Subordinated Obligations as trustee for Agent and Lenders and deliver
such payments to Agent on account of the Guaranteed Obligations
(including any and all Disallowed Post-Commencement Interest and
Expenses), together with any necessary endorsements or other instruments
of transfer, but without reducing or affecting in any manner the
liability of such Guarantor under the other provisions of this Guaranty.
(d) Agent Authorization. After the occurrence and during the
continuance of any Default (including the commencement and continuation
of any Debtor Relief Proceeding relating to any Borrower), Agent is
authorized and empowered (but without any obligation to so do), in its
discretion, (i) in the name of each Guarantor, to collect and enforce,
and to submit claims in respect of, Subordinated Obligations and to
apply any amounts received thereon to the Guaranteed Obligations
(including any and all Disallowed Post-Commencement Interest and
Expenses), and (ii) to require each Guarantor (A) to collect and
enforce, and to submit claims in respect of, Subordinated Obligations
and (B) to pay any amounts received on such obligations to Agent for
application to the Guaranteed Obligations (including any and all
Disallowed Post-Commencement Interest and Expenses).
5. CONTRIBUTION AMONG GUARANTORS. Guarantors desire to allocate among
themselves, in a fair and equitable manner, their rights of contribution from
each other when any payment is made by any Guarantor under this Guaranty.
Accordingly, if any payment is made by any Guarantor under this Guaranty (a
"Funding Guarantor") that exceeds its Fair Share, the Funding Guarantor shall be
entitled to a contribution from each other Guarantor in the amount of such other
Guarantor's Fair Share Shortfall, so that all such contributions shall cause
each Guarantor's Aggregate Guaranty Payments to equal its Fair Share. The
amounts payable as contributions hereunder shall be determined by the Funding
Guarantor as of the date on which the related payment or distribution is made by
the Funding Guarantor, and such determination shall be binding on the other
Guarantors absent manifest error. The allocation and right of contribution among
Guarantors set forth in this Paragraph 5 shall not be construed to limit in any
way the liability of any Guarantor under this Guaranty or the amount of the
Guaranteed Obligations.
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6. MISCELLANEOUS.
(a) Notices. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or
upon any Guarantor or Agent under this Guaranty or the other Credit
Documents shall be in writing and faxed, mailed or delivered, if to
Agent, at its facsimile number or address set forth below, or, if to any
Guarantor, at its facsimile number or address set forth below its
signature below or in the respective Subsidiary Joinder for such
Guarantor (or to such other facsimile number or address for any party as
indicated in any notice given by that party to the other parties). All
such notices and communications shall be effective (i) when sent by any
overnight courier service of recognized standing, on the second Business
Day following the deposit with such service; (ii) when mailed, first
class postage prepaid and addressed through the United States Postal
Service, upon receipt; (iii) when delivered by hand, upon delivery; and
(iv) when faxed, upon confirmation of receipt.
Agent: ABN AMRO Bank N.V.
Syndications Group
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
U.S.A.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel. No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax. No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
ABN AMRO Bank N.V.
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▇▇▇▇▇-▇▇▇▇ U.S.A.
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Tel No: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
(b) Payments.
(i) Each Guarantor shall make all payments of the
Guaranteed Obligations to Agent, or its order, at the office of
Agent and at the times specified in the Credit Documents for the
payment of such Guaranteed Obligations. Each Guarantor shall make
all other payments hereunder at such office as Agent may
designate. Each payment shall be made in same day or immediately
available funds not later than 11:00 a.m.(local time of the
office of Agent at which such payment is to be made) on the date
due.
(ii) Each Guarantor shall make all payments of the
Guaranteed Obligations hereunder in the currency in which such
Guaranteed Obligations are required to be paid by Borrower
pursuant to the Credit Documents and shall make all other
payments hereunder in Dollars; provided, however, that, if Agent
shall request a Guarantor to pay any amount hereunder which would
otherwise be payable in another currency in the lawful currency
of the United States, such Guarantor shall pay to Agent the
Dollar Equivalent of such amount.
(iii) If any sum due from any Guarantor under this
Guaranty or any other Credit Document to which such Guarantor is
a party or any order, judgment or award given or rendered in
relation hereto or thereto has to be converted from the currency
(the "first currency") in which the same is payable hereunder or
thereunder into another currency (the "second currency") for the
purpose of (A) making or filing a claim or proof against such
Guarantor with any Governmental Authority, (B) obtaining an order
or judgment in any court or other tribunal or (C) enforcing any
order or judgment given or made in relation hereto, such
Guarantor shall, to the fullest extent permitted by law,
indemnify and hold harmless each of the Persons to whom such sum
is due from
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and against any loss suffered as a result of any
discrepancy between (1) the rate of exchange used for such
purpose to convert the amounts in question from the first
currency into the second currency and (2) the rate or rates of
exchange at which such Person may, using reasonable efforts in
the ordinary course of business, purchase the first currency with
the second currency upon receipt of a sum paid to it in
satisfaction, in whole or in part, of any such order, judgment,
claim or proof. The foregoing indemnity shall constitute a
separate obligation of each Guarantor distinct from its other
obligations hereunder and shall survive the giving or making of
any judgment or order in relation to all or any of such
obligations.
(iv) If any amounts required to be paid by any Guarantor
under this Guaranty or any order, judgment or award given or
rendered in relation hereto remain unpaid after such amounts are
due, such Guarantor shall pay interest on the aggregate,
outstanding balance of such amounts from the date due until those
amounts are paid in full at a per annum rate equal to:
(1) In the case of amounts payable in Dollars, the
Base Rate plus two percent (2.00%), such rate to change from time to time as the
Base Rate shall change.
(2) In the case of amounts payable in any other
currency, the Overnight Rate for such currency plus three percent (3.0%), such
rate to change from time to time as the Overnight Rate shall change.
(c) Expenses. Each Guarantor shall pay on demand (i) all
reasonable and documented fees and expenses, including reasonable
attorneys' fees and expenses, incurred by Agent in connection with the
preparation, execution and delivery of, and the exercise of its duties
under, this Guaranty and the preparation, execution and delivery of
amendments and waivers hereunder and (ii) all reasonable and documented
fees and expenses, including reasonable attorneys' fees and expenses,
incurred by Agent and Lenders in connection with the enforcement or
attempted enforcement of this Guaranty or any of the Guaranteed
Obligations or in preserving any of Agent's or Lenders' rights and
remedies (including, without limitation, all such fees and expenses
incurred in connection with any "workout" or restructuring affecting the
Credit Documents or the Guaranteed Obligations or any bankruptcy or
similar proceeding involving Guarantor, any other Guarantor, any
Borrower, or any of their affiliates).
(d) Waivers; Amendments. This Guaranty may not be amended or
modified, nor may any of its terms be waived, except by written
instruments signed by each Guarantor and Agent. Each waiver or consent
under any provision hereof shall be effective only in the specific
instances for the purpose for which given. No failure or delay on
Agent's or any Lender's part in exercising any right hereunder shall
operate as a waiver thereof or of any other right nor shall any single
or partial exercise of any such right preclude any other further
exercise thereof or of any other right.
(e) Successors and Assigns. This Guaranty shall be binding upon
and inure to the benefit of Agent, Lenders, Guarantors and their
respective successors and assigns; provided, however, that no Guarantor
may assign or transfer any of its rights and obligations under this
Guaranty without the prior written consent of Agent and Lenders, and,
provided, further, that Agent or any Lender may sell, assign and
delegate their respective rights and obligations hereunder only as
permitted by the Credit Agreement. All references in this Guaranty to
any Person shall be deemed to include all permitted successors and
assigns of such Person.
(f) Cumulative Rights, etc. The rights, powers and remedies of
Agent and Lenders under this Guaranty shall be in addition to all
rights, powers and remedies given to Agent and Lenders by virtue of any
applicable law, rule or regulation of any Governmental Authority, the
Credit Agreement, any other Credit Document or any other agreement, all
of which rights, powers, and remedies shall be cumulative and may be
exercised successively or concurrently without impairing Agent's or any
Lender's rights hereunder. Each Guarantor waives any right to require
Agent or any Lender to proceed against any Person or to exhaust any
Collateral or to pursue any remedy in Agent's or such Lender's power.
8
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(g) Setoff; Security Interest.
(i) In addition to any rights and remedies of Lenders
provided by law, each Lender shall have the right, with the prior
consent of Agent but without prior notice to or consent of any
Guarantor, any such notice and consent being expressly waived by
each Guarantor to the extent permitted by applicable law, upon
the occurrence and during the continuance of an Event of Default,
to set-off and apply against the obligations of each Guarantor
any amount owing from such Lender to such Guarantor. The
aforesaid right of set-off may be exercised by such Lender
against a Guarantor or against any trustee in bankruptcy, debtor
in possession, assignee for the benefit of creditors, receiver or
execution, judgment or attachment creditor of such Guarantor or
against anyone else claiming through or against such Guarantor or
such trustee in bankruptcy, debtor in possession, assignee for
the benefit of creditors, receiver, or execution, judgment or
attachment creditor, notwithstanding the fact that such right of
set-off may not have been exercised by such Lender at any prior
time. Each Lender agrees promptly to notify the applicable
Guarantor after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not
affect the validity of such set-off and application.
(ii) As security for the obligations of each Guarantor
hereunder, each Guarantor hereby grants to Agent and each Lender,
for the benefit of all Lenders, a continuing security interest in
any and all deposit accounts or moneys of such Guarantor now or
hereafter maintained with such Lender. Each Lender shall have all
of the rights of a secured party with respect to such security
interest.
(h) Payments Free of Taxes. All payments made by each Guarantor
under this Guaranty shall be made free and clear of, and without
deduction or withholding for or on account of, all present and future
Non-Excluded Taxes. If any Non-Excluded Taxes are required to be
withheld from any amounts payable to Agent or any Lender hereunder, the
amounts so payable to Agent or such Lender shall be increased to the
extent necessary to yield to Agent or such Lender (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable hereunder
at the rates or in the amounts specified in this Guaranty or the other
Credit Documents, as applicable. Whenever any Non-Excluded Taxes are
payable by any Guarantor, as promptly as possible thereafter, such
Guarantor shall send to Agent for its own account or for the account of
such Lender, as the case may be, a certified copy of an original
official receipt received by such Guarantor showing payment thereof. If
Guarantors fail to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fail to remit to Agent the required
receipts or other required documentary evidence, Guarantors shall
indemnify Agent and Lenders for any taxes (including interest or
penalties) that may become payable by Agent or any Lender as a result of
any such failure. The obligations of Guarantors under this Subparagraph
6(h) shall survive the payment and performance of the Guaranteed
Obligations and the termination of this Guaranty. Nothing contained in
this Subparagraph 6(h) shall require Agent or any Lender to make
available any of its tax returns (or any other information relating to
its taxes which it deems to be confidential).
(i) Partial Invalidity. If at any time any provision of this
Guaranty is or becomes illegal, invalid or unenforceable in any respect
under the law or any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions of this Guaranty nor the
legality, validity or enforceability of such provision under the law of
any other jurisdiction shall in any way be affected or impaired thereby.
(j) Jury Trial. EACH OF GUARANTORS, LENDERS AND AGENT, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY
ACTION, PROCEEDING, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
GUARANTY.
(k) Counterparts. This Guaranty may be executed in any number of
identical counterparts, any set of which signed by all the Guarantors
shall be deemed to constitute a complete, executed original for all
purposes.
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(l) Governing Law, Consent to Jurisdiction, Etc.
(i) This Guaranty shall be governed by and construed in
accordance with the laws of the State of California, except for
the purposes of any suit or legal action brought in Mexico in
which case it shall be governed by the laws of Mexico.
(ii) Each Guarantor irrevocably submits to the
non-exclusive jurisdiction of the courts of the State of
California and the courts of the United States of America located
in the Northern District of California and, in respect of the
Mexican Guarantor, the Mexican Guarantor and the Agent, on behalf
of Lenders, also irrevocably submit to the jurisdictions of the
courts of the Federal District of Mexico, Mexico, and agrees that
any legal action, suit or proceeding arising out of or relating
to this Guaranty or any of the other Credit Documents may be
brought against such party in any such courts. Final judgment
against a Guarantor in any such action, suit or proceeding shall
be conclusive and may be enforced in any other jurisdiction by
suit on the judgment, a certified or exemplified copy of which
shall be conclusive evidence of the judgment, or in any other
manner provided by law. Nothing in this Subparagraph 6(l) shall
affect the right of Agent or any Lender to commence legal
proceedings or otherwise ▇▇▇ any Guarantor in any other
appropriate jurisdiction, or concurrently in more than one
jurisdiction, or to serve process, pleadings and other papers
upon any Guarantor in any manner authorized by the laws of any
such jurisdiction. Subject to and except as otherwise provided in
paragraph (iii) below in respect of the Mexican Guarantor, each
Guarantor agrees that process served either personally or by
registered mail shall, to the extent permitted by law,
constitutes adequate service of process in any such suit. Without
limiting the foregoing, each Guarantor hereby appoints, in the
case of any such action or proceeding brought in the courts of or
in the State of California, CT Corporation, with offices on the
date hereof at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, to receive for it and on its behalf, service of process in
the State of California with respect thereto, provided each
Guarantor may appoint any other person, reasonably acceptable to
Agent, with offices in the State of California to replace such
agent for service of process upon delivery to Agent of a
reasonably acceptable agreement of such new agent agreeing so to
act. Each Guarantor irrevocably waives to the fullest extent
permitted by applicable law (A) any objection which it may have
now or in the future to the laying of the venue of any such
action, suit or proceeding in any court referred to in the first
sentence above; (B) any claim that any such action, suit or
proceeding has been brought in an inconvenient forum; (C) its
right of removal of any matter commenced by any other party in
the courts of the State of California to any court of the United
States of America; (D) any immunity which it or its assets may
have in respect of its obligations under this Agreement or any
other Credit Document from any suit, execution, attachment
(whether provisional or final, in aid of execution, before
judgment or otherwise) or other legal process; and (E) any right
it may have to require the moving party in any suit, action or
proceeding brought in any of the courts referred to above arising
out of or in connection with this Agreement or any other Credit
Document to post security for the costs of any Guarantor or to
post a bond or to take similar action.
(iii) The Mexican Guarantor hereby irrevocably appoints CT
Corporation, Los Angeles Agency, (the "FMM Process Agent"), with
an office on the date hereof in ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, in the case of any action, suit or
proceeding arising out of or relating to this Guaranty or any of
the other Credit Documents brought in the courts of or in the
State of California, as its agent to receive for it and on its
behalf service of process in the State of California with respect
thereto. Such service may be made by mailing or delivering a copy
of such process to the Mexican Guarantor in care of the FMM
Process Agent at the FMM Process Agent's above address, and the
Guarantor hereby irrevocably authorizes and directs the FMM
Process Agent to accept such service on its behalf; provided,
that for any notice or service of process to be effective under
Mexican law, such notice or service of process shall be deemed to
have been given or made when delivered either (i) personally,
return receipt requested, (ii) by courier delivery or certified
mail, return receipt requested, or (iii) by facsimile followed by
personal or courier delivery, return receipt requested. The
Mexican Guarantor agrees that a final judgment in any such
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner
provided by law. For purposes of perfecting the
10
91
appointment of the FMM Process Agent under the applicable
laws of Mexico, the Mexican Guarantor agrees to execute and
deliver the power of attorney attached hereto as Attachment 2,
formalized before a notary public in Mexico and duly recorded at
the Public Registry of Commerce (Registro Publico de Comercio) of
the corporate domicile of the Mexican Guarantor, and to execute
and deliver any and all other documents (including Mexican
notarial deeds) as may be required by the Agent in its sole
discretion.
[The first signature page follows.]
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92
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed as of the day and year first above written.
FLEXTRONICS INTERNATIONAL LTD., acting
through its Hong Kong branch
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ Center
▇▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
Attn: Chief Financial Officer
Telephone: (___) ___-____
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇, ▇▇▇▇▇
▇.▇.▇.
Attn: Treasurer
Telephone: (___) ___-____
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
FLEXTRONICS INTERNATIONAL LATIN
AMERICA (L) LTD.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
Level 10, Wisma Oceanic
Jalan OKK Awang Besar
Labuan, F.T.
Malaysia
Attn: ___________________
Telephone: (___) ___-____
Facsimile: (___) ___-____
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FLEXTRONICS INTERNATIONAL
MARKETING (L) LTD.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
Level 10, Wisma Oceanic
Jalan OKK Awang Besar
Labuan, F.T.
Malaysia
Attn: ___________________
Telephone: (___) ___-____
Facsimile: (___) ___-____
FLEXTRONICS MANUFACTURING MEX,
S.A. DE C.V.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
Attn: ___________________
Telephone: (___) ___-____
Facsimile: (___) ___-____
FLEXTRONICS SINGAPORE PTE LTD.
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
#▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attn: ___________________
Telephone: (___) ___-____
Facsimile: (___) ___-____
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FLEXTRONICS HOLDINGS UK LIMITED
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Attn: ___________________
Telephone: (___) ___-____
Facsimile: (___) ___-____
14
95
ATTACHMENT 1
SUBSIDIARY JOINDER
THIS SUBSIDIARY JOINDER (this "Agreement"), dated as of
____________, ____, is executed by [NEW ELIGIBLE MATERIAL SUBSIDIARY], a
_________ [corporation] [partnership] [etc.] ("New Subsidiary") in favor of ABN
AMRO BANK N.V., acting as agent (in such capacity, and each successor thereto in
such capacity, "Agent") for the financial institutions which are from time to
time parties to the Credit Agreement referred to in Recital A below
(collectively, the "Lenders").
RECITALS
A. Pursuant to a Credit Agreement dated as of October [A], 1999
(as amended from time to time, the "Credit Agreement"), among Flextronics
International USA, Inc. ("FIUI" or "Borrower"), Lenders and Agent, Lenders have
agreed to extend certain credit facilities to FIUI upon the terms and subject to
the conditions set forth therein.
B. Lenders' obligations to extend the credit facilities to
Borrower under the Credit Agreement are subject, among other conditions, to
receipt by Agent of (1) a Guaranty, dated as of October 27, 1999, duly executed
by each existing Eligible Material Subsidiary and any other Subsidiary
designated as a Guarantor from time to time, and (2) Subsidiary Joinders, duly
executed by each future Eligible Material Subsidiary.
C. New Subsidiary is a new Eligible Material Subsidiary and
expects to derive substantial direct and indirect benefit from the transactions
contemplated by the Credit Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, New Subsidiary hereby agrees with Agent, for the ratable
benefit of Lenders and Agent, as follows:
1. DEFINITIONS AND INTERPRETATION. Unless otherwise defined
herein, all capitalized terms used herein and defined in the Guaranty shall have
the respective meanings given to those terms in the Guaranty. New Subsidiary
acknowledges receipt of copies of the Guaranty, the Credit Agreement and the
other Credit Documents.
2. REPRESENTATIONS AND WARRANTIES. On and as of the date of this
Agreement (the "Effective Date") and for the ratable benefit of the Agent and
Lenders, New Subsidiary hereby makes each of the representations and warranties
made by each Guarantor in the Guaranty.
3. AGREEMENT TO BE BOUND. New Subsidiary agrees that, on and as
of the Effective Date, it shall become a Guarantor under the Guaranty and shall
be bound by all the provisions of the Guaranty to the same extent as if New
Subsidiary had executed the Guaranty on the Closing Date.
4. WAIVER. Without limiting the generality of the waivers in the
Guaranty, New Subsidiary specifically agrees to be bound by the Guaranty and
waives any right to notice of acceptance of its execution of this Agreement and
of its agreement to be bound by the Guaranty.
5. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California.
(1)-1
96
IN WITNESS WHEREOF, New Subsidiary has caused this Agreement to
be executed by its duly authorized officer.
[NEW SUBSIDIARY]
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
Address:
[_________________________]
[_________________________]
[_________________________]
Attn: [___________________]
Telephone: [(___) ___-____]
Facsimile: [(___) ___-____]
(1)-2
97
ATTACHMENT 2
To be executed and delivered
by the Guarantor in the presence of,
and to be certified by,
a Mexican Notary Public
FORM OF SPECIAL IRREVOCABLE POWER OF ATTORNEY
[__________________], S.A. DE C.V. (the "Grantor"), a sociedad
anonima de capital variable duly incorporated and validly existing under the
laws of the United Mexican States ("Mexico"), hereby grants an irrevocable power
of attorney for litigation and collections in favor of [____________________]
(the "Attorney-In-Fact"), in terms of the first paragraph of article 2554 of the
Civil Code for the Federal District of Mexico and the corresponding articles of
the Civil Codes of all States of Mexico. This power of attorney is limited in
its scope but is as broad as necessary and may be exercised in any jurisdiction,
so that the Attorney-In-Fact, in the name and on behalf of the Grantor, receives
any and all notices and service of process of any nature in connection with any
suits, actions, proceedings and judgments of all kinds, including, without
limitation, judicial, administrative or arbitration proceedings in any way
relating to the Guaranty Agreement (the "Guaranty Agreement") dated
[___________], 1999 entered into by and among the Grantor, the other Guarantors,
the Lenders party thereto and ABN AMRO Bank N.V. as agent. The Grantor hereby
appoints as its domicile to receive any notices relating thereto,
[_______________] United States of America, or any other domicile of the
Attorney-In-Fact notified to the Grantor. This Power of Attorney is granted in
satisfaction of a condition set forth in the Guaranty Agreement, and it is
therefore irrevocable, in accordance with article 2596 of the Civil Code for the
Federal District of Mexico and the corresponding Articles of the Civil Code of
all States of Mexico.
(2)-1
98
ATTACHMENT 2
To be executed and delivered
by the Guarantor in the presence of,
and to be certified by,
a Mexican Notary Public
FORM SPECIAL IRREVOCABLE POWER OF ATTORNEY
"NUMERO
LIBRO
FOLIO
En la Ciudad de [_________] a los [____________] ▇▇▇▇ de mes de
[___________] de mil novecientos noventa y nueve, yo, el Licenciado
[__________________________], titular de la Notaria numero [____________] del
[_______________], hago constar el PODER ESPECIAL IRREVOCABLE, que se consigna
al tenor de la siguiente:
CLAUSULA UNICA
Por medio del presente instrumento, la sociedad denominada [__________________],
SOCIEDAD ANONIMA DE CAPITAL VARIABLE (la "Otorgante"), representada como ▇▇
▇▇▇▇▇▇▇ dicho, otorga en favor de la sociedad denominada [_______________], un
poder especial irrevocable para pleitos y cobranzas, en los terminos de primer
parrafo del Articulo dos mil quinientos cincuenta y cuatro del Codigo Civil para
el Distrito Federal y correlativos de los Estados de la Republica, que es
limitado en cuanto a su objeto, pero tan amplio como sea necesario, para ser
ejercido en cualquier jurisdiccion y a efecto de que, en nombre y representacion
de la Otorgante, reciba toda clase de notificaciones y emplazamientos de
cualquier naturaleza en relacion con cualquier demanda, accion, procedimiento o
juicio, incluyendo sin limitacion alguna procedimientos judiciales,
administrativos o arbitrales, derivados del Contrato de Garantia (Guaranty
Agreement; el "Contrato de Garantia") de fecha [___] de [_______] de 1999,
celebrado entre la Otorgante, las acreditantes (Lenders) ahi descritas y ABN
AMRO Bank N.V. como agente administrativo. La Otorgante senala como domicilio
convencional para recibir cualesquiera de las notificaciones o emplazamientos
antes citados el ubicado en [___________________________], Estados Unidos de
America, o cualquier otro domicilio que en el futuro designe
[__________________________]. El presente poder es irrevocable, en virtud de que
se otorga en cumplimiento de una condicion prevista en el Contrato de Garantia
en terminos del Articule 2596 del Codigo Civil para el Distrito Federal y
correlativos de los Estados de la Republica.
D(1)-1
99
EXHIBIT E
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT, dated as of [ ], is executed by
[____________________], a [________] ("Pledgor"), in favor of ABN AMRO BANK
N.V., acting as agent (in such capacity and each successor thereto acting in
such capacity, "Agent") for the financial institutions which are from time to
time parties to the Credit Agreement referred to in Recital A below
(collectively, "Lenders").
RECITALS
A. Pursuant to a Credit Agreement, dated as of October 27, 1999 (as
amended from time to time, the "Credit Agreement"), among Flextronics
International Ltd. ("FIL") , Flextronics International USA, Inc. ("Borrower"),
Lenders and Agent, Lenders have agreed to extend certain credit facilities to
Borrower upon the terms and subject to the conditions set forth therein.
B. Lenders' obligations to extend the credit facilities to Borrower
under the Credit Agreement are subject, among other conditions, to receipt by
Agent of this Agreement, duly executed by Pledgor.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Pledgor hereby agrees with Agent, for the ratable benefit of
Lenders and Agent, as follows:
1. DEFINITIONS AND INTERPRETATION.
(a) Definitions. When used in this Agreement, the following terms
shall have the following respective meanings:
"Agent" shall have the meaning given to that term in the
introductory paragraph hereof.
"Collateral" shall have the meaning given to that term in
Paragraph 2 hereof.
"Credit Agreement" shall have the meaning given to that
term in Recital A hereof.
"Equity Securities" of any Person shall mean (a) all
common stock, preferred stock, participations, shares,
partnership interests or other equity interests in and of such
Person (regardless of how designated and whether or not voting or
non-voting) and (b) all warrants, options and other rights to
acquire any of the foregoing.
"Lenders" shall have the meaning given to that term in the
introductory paragraph hereof.
"Pledged Shares" shall mean collectively the Equity
Securities pledged to Agent pursuant to Paragraph 2 hereof.
"Pledgor" shall have the meaning given to that term in the
introductory paragraph hereof.
"Secured Obligations" shall mean and include all loans,
advances, debts, liabilities, and obligations, howsoever arising,
owed by Pledgor to Agent or any Lender of every kind and
description (whether or not evidenced by any note or instrument
and whether or not for the payment of money) individual or joint
and several, direct or indirect, absolute or contingent, due
E-1
100
or to become due, now existing or hereafter arising pursuant to
the terms of the Credit Documents, including all interest, fees,
charges, expenses, attorneys' fees and accountants' fees
chargeable to Pledgor or payable by Pledgor thereunder.
"Subsidiary" of any Person shall mean (a) any corporation
of which more than 50% of the issued and outstanding Equity
Securities having ordinary voting power to elect a majority of
the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the
occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person, by such Person and
one or more of its other Subsidiaries or by one or more of such
Person's other Subsidiaries, (b) any partnership, joint venture,
limited liability company or other association of which more than
50% of the equity interest having the power to vote, direct or
control the management of such partnership, joint venture or
other association is at the time owned and controlled by such
Person, by such Person and one or more of the other Subsidiaries
or by one or more of such Person's other Subsidiaries or (c) any
other Person included in the Financial Statements of such Person
on a consolidated basis.
"UCC" shall mean the Uniform Commercial Code as in effect
in the State of California from time to time.
Unless otherwise defined herein, all other capitalized terms used herein
and defined in the Credit Agreement shall have the respective meanings
given to those terms in the Credit Agreement, and all terms defined in
the UCC shall have the respective meanings given to those terms in the
UCC.
(b) Other Interpretive Provisions. The rules of construction set
forth in Section I of the Credit Agreement shall, to the extent not
inconsistent with the terms of this Agreement, apply to this Agreement
and are hereby incorporated by reference.
2. PLEDGE. As security for the Secured Obligations, Pledgor hereby
pledges and assigns to Agent (for the ratable benefit of Lenders and Agent) and
grants to Agent (for the ratable benefit of Lenders and Agent) a security
interest in all right, title and interest of Pledgor in and to the property
described in subparagraphs (a) - (d) below, whether now owned or hereafter
acquired (collectively and severally, the "Collateral"):
(a) All of the Equity Securities described in Attachment 1
hereto, whether certificated or uncertificated;
(b) All dividends, cash, instruments and other property from time
to time received, receivable or otherwise distributed or distributable
in respect of or in exchange for any of the property described in
subparagraph (a) above; and
(c) All proceeds of the foregoing.
3. REPRESENTATIONS AND WARRANTIES. Pledgor represents and warrants to
Lenders and Agent as follows:
(a) Pledgor is the record legal and beneficial owner of the
Collateral (or, in the case of after-acquired Collateral, at the time
Pledgor acquires rights in the Collateral, will be the record legal and
beneficial owner thereof). No other Person has (or, in the case of
after-acquired Collateral, at the time Pledgor acquires rights therein,
will have) any right, title, claim or interest (by way of Lien, purchase
option or otherwise) in, against or to the Collateral.
(b) Agent has (or in the case of after-acquired Collateral, at
the time Pledgor acquires rights therein, will have) a first priority
perfected security interest in the Collateral.
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101
(c) All Pledged Shares have been (or in the case of
after-acquired Pledged Shares, at the time Pledgor acquires rights
therein, will have been) duly authorized, validly issued and fully paid
and are (or in the case of after-acquired Pledged Shares, at the time
Pledgor acquires rights therein, will be) non-assessable.
(d) Pledgor has delivered to Agent, together with all necessary
stock powers, endorsements, assignments and other necessary instruments
of transfer, the originals of all Pledged Shares, other certificated
securities, other Collateral and all certificates, instruments and other
writings evidencing the same.
(e) Set forth in Attachment 1 hereto is a true, complete and
accurate list, as of the date of this Agreement, of all Equity
Securities of Ineligible Material Subsidiaries owned directly by
Pledgor.
4. COVENANTS. Pledgor hereby agrees as follows:
(a) Pledgor, at Pledgor's expense, shall promptly procure,
execute and deliver to Agent all documents, instruments and agreements
and perform all acts which are necessary or desirable, or which Agent
may request, to establish, maintain, preserve, protect and perfect the
Collateral, the Lien granted to Agent therein and the first priority of
such Lien or to enable Agent to exercise and enforce its rights and
remedies hereunder with respect to any Collateral. Without limiting the
generality of the preceding sentence, Pledgor shall (i) procure, execute
and deliver to Agent all stock powers, endorsements, assignments,
financing statements and other instruments of transfer requested by
Agent, (ii) deliver to Agent promptly upon receipt the originals of all
Pledged Shares, other certificated securities, other Collateral and all
certificates, instruments and other writings evidencing the same and
(iii) cause the Lien of Agent to be recorded or registered in the books
of any financial intermediary or clearing corporation requested by
Agent.
(b) Pledgor shall pay promptly when due all taxes and other
Governmental Charges, all Liens and all other charges now or hereafter
imposed upon, relating to or affecting any Collateral.
(c) Pledgor shall appear in and defend any action or proceeding
which may affect its title to or Agent's interest in the Collateral.
(d) Pledgor shall not surrender or lose possession of (other than
to Agent), sell, encumber, lease, rent, option, or otherwise dispose of
or transfer any Collateral or right or interest therein except as
permitted in the Credit Agreement, and, notwithstanding any provision of
the Credit Agreement, Pledgor shall keep the Collateral free of all
Liens.
5. VOTING RIGHTS AND DIVIDENDS PRIOR TO DEFAULT. Unless an Event of
Default has occurred and is continuing:
(a) Pledgor may exercise or refrain from exercising any and all
voting and other consensual rights pertaining to the Pledged Shares or
any part thereof; provided, however, that Pledgor shall not exercise or
refrain from exercising any such rights where the consequence of such
action or inaction would be (i) to impair any Collateral, the Lien
granted to Agent therein, the first priority of such Lien or Agent's
rights and remedies hereunder with respect to any Collateral or (ii)
otherwise inconsistent with the terms of this Agreement and the other
Credit Documents.
(b) Pledgor may receive and retain all dividends and interest
paid in cash in respect of the Pledged Shares, except for any such
dividends and interest paid in connection with a partial or total
liquidation or dissolution or in connection with a reduction of capital,
capital surplus or paid-in-surplus. Pledgor shall promptly deliver to
Agent to hold as Collateral all dividends and interest which Pledgor is
not entitled to receive and retain pursuant to the preceding sentence,
in the same form as so received (with any
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necessary endorsement), and, until so delivered, shall hold such
dividends and interest in trust for the benefit of Agent, segregated
from the other property or funds of Pledgor.
6. AUTHORIZED ACTION BY AGENT. Pledgor hereby irrevocably appoints Agent
as its attorney-in-fact and agrees that Agent may perform (but Agent shall not
be obligated to and shall incur no liability to Pledgor or any third party for
failure so to do) any act which Pledgor is obligated by this Agreement to
perform, and to exercise such rights and powers as Pledgor might exercise with
respect to the Collateral, including, without limitation, the right to (a)
collect by legal proceedings or otherwise and endorse, receive and receipt for
all dividends, interest, payments, proceeds and other sums and property now or
hereafter payable on or on account of the Collateral; (b) enter into any
extension, reorganization, deposit, merger, consolidation or other agreement
pertaining to, or deposit, surrender, accept, hold or apply other property in
exchange for the Collateral; (c) insure, process, preserve and enforce the
Collateral; (d) make any compromise or settlement, and take any action it deems
advisable, with respect to the Collateral; (e) pay any Indebtedness of Pledgor
relating to the Collateral; and (f) execute UCC financing statements and other
documents, instruments and agreements required hereunder; provided, however,
that Agent may exercise such powers only after the occurrence and during the
continuance of an Event of Default. Pledgor agrees to reimburse Agent upon
demand for all reasonable and documented costs and expenses, including
reasonable and documented attorneys' fees, Agent may incur while acting as
Pledgor's attorney-in-fact hereunder, all of which costs and expenses are
included in the Secured Obligations. Pledgor agrees that such care as Agent
gives to the safekeeping of its own property of like kind shall constitute
reasonable care of the Collateral when in Agent's possession; provided, however,
that Agent shall not be required to make any presentment, demand or protest, or
give any notice and need not take any action to preserve any rights against any
prior party or any other Person in connection with the Secured Obligations or
with respect to the Collateral.
7. EVENTS OF DEFAULT.
(a) Event of Default. Pledgor shall be deemed in default under
this Agreement upon the occurrence and during the continuance of an
Event of Default, as that term is defined in the Credit Agreement.
(b) Voting Rights and Dividends. Upon the occurrence and during
the continuance of an Event of Default:
(i) All rights of Pledgor to exercise the voting and other
consensual rights which it would otherwise be entitled to
exercise pursuant to subparagraph 5(a) hereof and to receive the
dividends and interest payments which it would otherwise be
authorized to receive and retain pursuant to subparagraph 5(a)
hereof shall cease and all such rights shall thereupon become
vested in Agent which shall thereupon have the sole right, but
not the obligation, to exercise such voting and other consensual
rights and to receive and hold as Collateral such dividends and
interest payments.
(ii) Pledgor shall promptly deliver to Agent to hold as
Collateral all dividends and interest received by Pledgor after
the occurrence and during the continuance of any Event of
Default, in the same form as so received (with any necessary
endorsement), and, until so delivered, shall hold such dividends
and interest in trust for the benefit of Agent, segregated from
the other property or funds of Pledgor.
(c) Other Rights and Remedies. In addition to all other rights
and remedies granted to Agent by this Agreement, the Credit Agreement,
the other Credit Documents, the UCC and other applicable Governmental
Rules, Agent may, upon the occurrence and during the continuance of any
Event of Default, exercise any one or more of the following rights and
remedies: (i) collect, receive, appropriate or realize upon the
Collateral or otherwise foreclose or enforce Agent's security interests
in any or all Collateral in any manner permitted by applicable
Governmental Rules or in this Agreement; (ii) notify any or all issuers
of or transfer or paying agents for the Collateral or any applicable
clearing corporation, financial intermediary or other Person to register
the Collateral in the name of Agent or its nominee and/or to pay all
dividends, interest and other amounts payable in respect of the
Collateral directly to Agent; (iii) sell or
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otherwise dispose of any or all Collateral at one or more public or
private sales, whether or not such Collateral is present at the place of
sale, for cash or credit or future delivery, on such terms and in such
manner as Agent may determine; and (iv) require Pledgor to assemble all
records and information relating to the Collateral and make it available
to Agent at a place to be designated by Agent. In any case where notice
of any sale or disposition of any Collateral is required, Pledgor hereby
agrees that seven (7) days notice of such sale or disposition is
reasonable.
(d) Securities Laws.
(i) Pledgor acknowledges and recognizes that Agent may be
unable to effect a public sale of all or a part of the Pledged
Shares and may be compelled to resort to one or more private
sales to a restricted group of purchasers who will be obligated
to agree, among other things, to acquire the Pledged Shares for
their own account, for investment and not with a view to the
distribution or resale thereof. Pledgor acknowledges that any
such private sales may be at prices and on terms less favorable
to Agent than those of public sales, and agrees that such private
sales shall be deemed to have been made in a commercially
reasonable manner and that Agent has no obligation to delay sale
of any Pledged Shares to permit the issuer thereof to register it
for public sale under the Securities Act of 1933, as amended, or
under any state securities law.
(ii) Upon the occurrence and during the continuance of an
Event of Default and at Agent's request, Pledgor shall, and shall
cause all issuers of Collateral and all officers and directors
thereof and all other necessary Persons to, execute and deliver
all documents, instruments and agreements and perform all other
acts necessary or, in the opinion of Agent, advisable to sell the
Collateral in any public or private sale, including any acts
requested by Agent to (A) register any Collateral under the
Securities Act of 1933, (B) qualify any Collateral under any
state securities or "Blue Sky" laws or (C) otherwise permit any
such sale to be made in full compliance with all applicable
Governmental Rules.
8. MISCELLANEOUS.
(a) Notices. Except as otherwise specified herein, all notices,
requests, demands, consents, instructions or other communications to or
upon Pledgor or Agent under this Agreement shall be given as provided in
Paragraph 8.01 of the Credit Agreement.
(b) Waivers; Amendments. Any term, covenant, agreement or
condition of this Agreement may be amended or waived only as provided in
the Credit Agreement. No failure or delay by Agent or any Lender in
exercising any right hereunder shall operate as a waiver thereof or of
any other right nor shall any single or partial exercise of any such
right preclude any other further exercise thereof or of any other right.
Unless otherwise specified in any such waiver or consent, a waiver or
consent given hereunder shall be effective only in the specific instance
and for the specific purpose for which given.
(c) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of Agent, Lenders, Pledgor and their respective
successors and assigns; provided, however, that Pledgor may not assign
or transfer any of its rights and obligations under this Agreement
without the prior written consent of Agent and Lenders, and, provided,
further, that Agent or any Lender may sell, assign and delegate their
respective rights and obligations hereunder only as permitted by the
Credit Agreement. All references in this Agreement to any Person shall
be deemed to include all permitted successors and assigns of such
Person.
(d) Cumulative Rights, etc. The rights, powers and remedies of
Agent and Lenders under this Agreement shall be in addition to all
rights, powers and remedies given to Agent and Lenders by virtue of any
applicable law, rule or regulation of any Governmental Authority, the
Credit Agreement, any other Credit Document or any other agreement, all
of which rights, powers, and remedies shall be cumulative and may be
exercised successively or concurrently without impairing Agent's or any
Lender's rights hereunder.
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Pledgor waives any right to require Agent or any Lender to proceed
against any Person or to exhaust any Collateral or to pursue any remedy
in Agent's or such Lender's power.
(e) Partial Invalidity. If at any time any provision of this
Agreement is or becomes illegal, invalid or unenforceable in any respect
under the law of any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions of this Agreement nor the
legality, validity or enforceability of such provision under the law of
any other jurisdiction shall in any way be affected or impaired thereby.
(f) Governing Law.
(i) This Agreement shall be governed by and construed in
accordance with the laws of the State of California without
reference to conflicts of laws rules (except to the extent
otherwise provided in the UCC).
(ii) The Pledgor agrees that for the exclusive benefit of
the Agent, the Co-Agents and the Lenders, any suit, action or
proceeding by the Agent, the Co-Agents or the Lenders arising our
of or in connection with this Agreement may be brought by the
Agent, the Co-Agents or the Lenders in any competent court of the
State of California or any federal court of the United States of
America sitting in the State of California, and the Pledgor
submits to the non-exclusive jurisdiction of each such court. The
Pledgor further agrees, for the non-exclusive benefit of the
Agent, the Co-Agents and the Lenders, that nothing contained in
this paragraph (f) shall limit the right of the Agent or the
Banks to take suit, action or proceedings against Pledgor in any
other competent jurisdiction. Pledgor irrevocably waives any
right it may have to the trial by jury of such proceedings in any
such court.
[The signature page follows.]
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IN WITNESS WHEREOF, Pledgor has caused this Agreement to be executed as
of the day and year first above written.
[____________________]
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
▇-▇
▇▇▇
▇▇▇▇▇▇▇▇▇▇ 1
TO PLEDGE AGREEMENT
PLEDGED SHARES
Classes of Voting Issued and Shares Owned Shares
Jurisdiction Equity Or Outstanding by Pledged to
Subsidiary Of Organization Securities Non-Voting Shares Pledgor Agent
---------- --------------- ---------- ---------- ----------- ------------ ----------
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EXHIBIT F
ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT, dated as of the date set forth at the top of
Attachment 1 hereto, by and among:
(1) The bank designated under item A of Attachment 1 hereto as
the Assignor Lender ("Assignor Lender"); and
(2) Each bank designated under item B of Attachment 1 hereto as
an Assignee Lender (individually, an "Assignee Lender").
RECITALS
A. Assignor Lender is one of the Lenders which is a party to the Credit
Agreement dated as of October 27, 1999, among Flextronics International USA,
Inc. ("Borrower"), Assignor Lender and the other financial institutions parties
thereto (collectively, the "Lenders") and ABN AMRO Bank N.V., as agent for
Lenders (in such capacity, "Agent"). (Such credit agreement, as amended,
supplemented or otherwise modified in accordance with its terms from time to
time to be referred to herein as the "Credit Agreement").
B. Assignor Lender wishes to sell, and Assignee Lender wishes to
purchase, all or a portion of Assignor Lender's rights under the Credit
Agreement pursuant to Subparagraph 8.05(c) of the Credit Agreement.
AGREEMENT
Now, therefore, the parties hereto hereby agree as follows:
1. Definitions. Except as otherwise defined in this Assignment
Agreement, all capitalized terms used herein and defined in the Credit Agreement
have the respective meanings given to those terms in the Credit Agreement.
2. Sale and Assignment. Subject to the terms and conditions of this
Assignment Agreement, Assignor Lender hereby agrees to sell, assign and delegate
to each Assignee Lender and each Assignee Lender hereby agrees to purchase,
accept and assume the rights, obligations and duties of a Lender under the
Credit Agreement and the other Credit Documents with Commitments or Loans equal
to the respective amounts set forth under the caption "Commitments or Loans
Assigned," opposite such Assignee Lender's name on Attachment 1 hereto. Such
sale, assignment and delegation shall become effective on the date designated in
Attachment 1 hereto (the "Assignment Effective Date"), which date shall be,
unless Agent shall otherwise consent, at least five (5) Business Days after the
date following the date counterparts of this Assignment Agreement are delivered
to Agent in accordance with Paragraph 3 hereof.
3. Assignment Effective Notice. Upon (a) receipt by Agent of five (5)
counterparts of this Assignment Agreement (to each of which is attached a fully
completed Attachment 1), each of which has been executed by Assignor Lender and
each Assignee Lender (and, to the extent required by Subparagraph 8.05(c) of the
Credit Agreement, by Borrower and Agent) and (b) payment to Agent of the
registration and processing fee specified in Subparagraph 8.05(e) of the Credit
Agreement by Assignor Lender, Agent will transmit to Borrower, Assignor Lender
and each Assignee Lender an Assignment Effective Notice substantially in the
form of Attachment 2 hereto, fully completed (an "Assignment Effective Notice").
4. Assignment Effective Date. At or before 12:00 noon (California time)
on the Assignment Effective Date, each Assignee Lender shall pay to Assignor
Lender, in immediately available or same day funds, an
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amount equal to the purchase price, as agreed between Assignor Lender and such
Assignee Lender (the "Purchase Price"), for each portion of a Commitment or Loan
purchased by such Assignee Lender hereunder. Effective upon receipt by Assignor
Lender of each Purchase Price payable by each Assignee Lender, the sale,
assignment and delegation to such Assignee Lender of such Commitments or Loans
as described in Paragraph 2 hereof shall become effective.
5. Payments After the Assignment Effective Date. Assignor Lender and
each Assignee Lender hereby agree that Agent shall, and hereby authorize and
direct Agent to, allocate amounts payable under the Credit Agreement and the
other Credit Documents as follows:
(a) All principal payments made after the Assignment Effective
Date with respect to each portion of a Loan assigned to an Assignee
Lender pursuant to this Assignment Agreement shall be payable to such
Assignee Lender.
(b) All interest, fees and other amounts accrued after the
Assignment Effective Date with respect to each portion of a Loan
assigned to an Assignee Lender pursuant to this Assignment Agreement
shall be payable to such Assignee Lender.
Assignor Lender and each Assignee Lender shall make any separate arrangements
between themselves which they deem appropriate with respect to payments between
them of amounts paid under the Credit Documents on account of the Commitments or
Loans assigned to such Assignee Lender, and neither Agent nor Borrower shall
have any responsibility to effect or carry out such separate arrangements.
[6. Delivery of Notes. On or prior to the Assignment Effective Date,
Assignor Lender will deliver to Agent the Notes payable to Assignor Lender. On
or prior to the Assignment Effective Date, Borrower will deliver to Agent new
Notes for each Assignee Lender and Assignor Lender, in each case in principal
amounts reflecting, in accordance with the Credit Agreement, their respective
Commitments (as adjusted pursuant to this Assignment Agreement). As provided in
Subparagraph 8.05(c) of the Credit Agreement, each such new Note shall be dated
the Closing Date. Promptly after the Assignment Effective Date, Agent will send
to each of Assignor Lender and the Assignee Lenders its new Notes and will send
to Borrower the superseded Note payable to Assignor Lender, marked "Replaced."]
7. Delivery of Copies of Credit Documents. [Concurrently with the
execution and delivery hereof, Assignor Lender will provide to each Assignee
Lender (if it is not already a Lender party to the Credit Agreement) conformed
copies of all documents delivered to Assignor Lender on or prior to the Closing
Date in satisfaction of the conditions precedent set forth in the Credit
Agreement.]
8. Further Assurances. Each of the parties to this Assignment Agreement
agrees that at any time and from time to time upon the written request of any
other party, it will execute and deliver such further documents and do such
further acts and things as such other party may reasonably request in order to
effect the purposes of this Assignment Agreement.
9. Further Representations, Warranties and Covenants. Assignor Lender
and each Assignee Lender further represent and warrant to and covenant with each
other, Agent and Lenders as follows:
(a) Other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned hereby free
and clear of any adverse claim, Assignor 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 Credit Agreement or the other Credit Documents or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of
the Credit Agreement or the other Credit Documents furnished or the
Collateral or any security interest therein.
(b) Assignor Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of
Borrower or any of their oblations under the Credit Agreement or any
other Credit Documents.
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(c) Each Assignee Lender confirms that it has received a copy of
the Credit Agreement and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement.
(d) Each Assignee Lender will, independently and without reliance
upon Agent, Assignor Lender or any other Lender and based upon such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under the Credit Agreement and the other Credit Documents.
(e) Each Assignee Lender appoints and authorizes Agent to take
such action as Agent on its behalf and to exercise such powers under the
Credit Agreement and the other Credit Documents as Agent is authorized
to exercise by the terms thereof, together with such powers as are
reasonably incidental thereto, all in accordance with Section VII of the
Credit Agreement.
(f) Each Assignee Lender agrees that it will perform in
accordance with their terms all of the obligations which by the terms of
the Credit Agreement and the other Credit Documents are required to be
performed by it as a Lender.
(g) Attachment 1 hereto sets forth administrative information
with respect to each Assignee Lender.
10. Effect of this Assignment Agreement. On and after the Assignment
Effective Date, (a) each Assignee Lender shall be a Lender with Commitments or
Loans as set forth under the caption "Commitments or Loans After Assignment"
opposite such Assignee Lender's name on Attachment 1 hereto and shall have the
rights, duties and obligations of such a Lender under the Credit Agreement and
the other Credit Documents and (b) Assignor Lender shall be a Lender with
Commitments or Loans as set forth under the caption "Commitments or Loans After
Assignment" opposite Assignor Lender's name on Attachment 1 hereto and shall
have the rights, duties and obligations of such a Lender under the Credit
Agreement and the other Credit Documents, or, if the Commitments or Loans of
Assignor Lender have been reduced to $0, Assignor Lender shall cease to be a
Lender and shall have no further obligation to make any Loans.
11. Miscellaneous. This Assignment Agreement shall be governed by, and
construed in accordance with, the laws of the State of California. Paragraph
headings in this Assignment Agreement are for convenience of reference only and
are not part of the substance hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement to be executed by their respective duly authorized officers as of the
date set forth in Attachment 1 hereto.
_______________________________, as
Assignor Lender
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
____________________________, as an
Assignee Lender
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
____________________________, as an
Assignee Lender
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
____________________________, as an
Assignee Lender
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
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CONSENTED TO AND ACKNOWLEDGED BY:
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
__________________________________,
As Agent
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
ACCEPTED FOR RECORDATION
IN REGISTER:
__________________________________,
As Agent
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
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112
ATTACHMENT 1
TO ASSIGNMENT AGREEMENT
PART A
Commitment/ Commitment/
Loan Loan After
Transferred Assignment
---------------- ----------------
Assignor Lender:
$ $
------------- ------------ ------------
Assignee Lenders:
$ $
------------- ------------ ------------
$ $
------------- ------------ ------------
$ $
------------- ------------ ------------
$ $
------------- ------------ ------------
F(1)-1
113
PART B
[ASSIGNEE PARTICIPANT]
Domestic Lending Office:
Euro-Dollar Lending Office:
Address for Notices:
Wiring Instructions:
PART C
ASSIGNMENT EFFECTIVE DATE ________, ____
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114
ATTACHMENT 2
TO ASSIGNMENT AGREEMENT
FORM OF
ASSIGNMENT EFFECTIVE NOTICE
Reference is made to the Credit Agreement, dated as of October 27, 1999,
among [[Borrower] ("Borrower")], the financial institutions parties thereto (the
"Lenders") and ABN AMRO Bank N.V., as agent for Lenders (in such capacity,
"Agent"). Agent hereby acknowledges receipt of five executed counterparts of a
completed Assignment Agreement, a copy of which is attached hereto. [Note:
Attach copy of Assignment Agreement.] Terms defined in such Assignment Agreement
are used herein as therein defined.
1. Pursuant to such Assignment Agreement, you are advised that the
Assignment Effective Date will be __________.
2. Pursuant to such Assignment Agreement, Assignor Lender is required to
deliver to Agent on or before the Assignment Effective Date the Notes payable to
Assignor Lender.
3. Pursuant to such Assignment Agreement, Borrower is required to
deliver to Agent on or before the Assignment Effective Date the following Notes,
each dated _________________ [Insert appropriate date]:
[Describe each new Note for Assignor Lender and each Assignee Lender as
to principal amount.]
4. Pursuant to such Assignment Agreement, each Assignee Lender is
required to pay its Purchase Price to Assignor Lender at or before 12:00 Noon [(
time)]on the Assignment Effective Date in immediately available funds.
Very truly yours,
ABN AMRO BANK N.V.
as Agent
By:
-------------------------------
Name:
-------------------------
Title:
-------------------------
F(2)-1