[CONFORMED COPY]
$750,000,000
CREDIT AGREEMENT
dated as of
October 20, 1997
among
BetzDearborn Inc.,
BetzDearborn Canada Inc.,
The Banks Parties Hereto,
and
The Chase Manhattan Bank
and
The Chase Manhattan Bank of Canada,
as Administrative Agents
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▇.▇. ▇▇▇▇▇▇ Securities Inc.,
Syndication Agent
Bank of America National Trust and Savings Association,
Documentation Agent
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions....................................................1
SECTION 1.02. Accounting Terms and Determinations...........................22
SECTION 1.03. Classes and Types of Loans....................................22
SECTION 1.04. Related Banks.................................................22
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend...........................................23
SECTION 2.02. Notice of Committed Borrowing.................................23
SECTION 2.03. Bankers' Acceptances..........................................24
SECTION 2.04. Money Market Borrowings.......................................28
SECTION 2.05. Notice to Banks; Funding of Loans.............................33
SECTION 2.06. Registry......................................................34
SECTION 2.07. Maturity of Loans.............................................34
SECTION 2.08. Interest Rates................................................35
SECTION 2.09. Fees..........................................................38
SECTION 2.10. Optional Termination, Reduction or Reallocation of
Commitments...................................................40
SECTION 2.11. Method of Electing Interest Rates.............................40
SECTION 2.12. Scheduled Termination of Commitments..........................42
SECTION 2.13. Optional Prepayments; Collateralization of Bankers'
Acceptances...................................................42
SECTION 2.14. General Provisions as to Payments.............................43
SECTION 2.15. Funding Losses................................................44
SECTION 2.16. Computation of Interest and Fees..............................44
SECTION 2.17. Regulation D Compensation.....................................45
SECTION 2.18. Judgment Currency.............................................45
SECTION 2.19. Foreign Costs.................................................46
SECTION 2.20. Currency Equivalents..........................................46
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing.......................................................47
SECTION 3.02. Borrowings and Acceptances of Bankers' Acceptances............48
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SECTION 3.03. First Borrowing by Each Eligible Subsidiary...................49
SECTION 3.04. Termination of Existing Credit Agreement......................50
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power.................................50
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention.................................................50
SECTION 4.03. Binding Effect................................................50
SECTION 4.04. Financial Information.........................................51
SECTION 4.05. Litigation....................................................51
SECTION 4.06. Compliance with ERISA.........................................51
SECTION 4.07. Environmental Matters.........................................52
SECTION 4.08. Taxes.........................................................52
SECTION 4.09. Subsidiaries..................................................52
SECTION 4.10. Regulatory Restrictions on Borrowing..........................53
SECTION 4.11. Full Disclosure...............................................53
ARTICLE 5
COVENANTS
SECTION 5.01. Company Information...........................................53
SECTION 5.02. Other Borrower Information....................................55
SECTION 5.03. Payment of Obligations........................................56
SECTION 5.04. Maintenance of Property; Insurance............................56
SECTION 5.05. Conduct of Business and Maintenance of Existence..............56
SECTION 5.06. Compliance with Laws..........................................57
SECTION 5.07. Inspection of Property, Books and Records.....................57
SECTION 5.08. Mergers and Sales of Assets...................................57
SECTION 5.09. Use of Proceeds...............................................57
SECTION 5.10. Negative Pledge...............................................58
SECTION 5.11. Debt to Total Capital.........................................59
SECTION 5.12. Debt of Subsidiaries..........................................59
SECTION 5.13. Minimum Consolidated Net Worth................................60
SECTION 5.14. Sale-leaseback Transactions...................................60
SECTION 5.15. Transactions with Affiliates..................................61
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ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default.............................................61
SECTION 6.02. Notice of Default.............................................63
SECTION 6.03. Action by Administrative Agents...............................64
ARTICLE 7
THE AGENTS
SECTION 7.01. Appointment and Authorization.................................64
SECTION 7.02. Administrative Agents and Affiliates..........................64
SECTION 7.03. Action by Administrative Agents...............................64
SECTION 7.04. Consultation with Experts.....................................64
SECTION 7.05. Liability of Administrative Agent.............................65
SECTION 7.06. Indemnification...............................................65
SECTION 7.07. Credit Decision...............................................65
SECTION 7.08. Successor Administrative Agent................................65
SECTION 7.09. Agents' Fees..................................................66
SECTION 7.10. Other Agents..................................................66
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair......66
SECTION 8.02. Illegality....................................................67
SECTION 8.03. Increased Cost and Reduced Return.............................68
SECTION 8.04. Taxes.........................................................69
SECTION 8.05. Base Rate Loans Substituted for Affected Fixed Rate Loans.....73
SECTION 8.06. Substitution of Bank..........................................73
SECTION 8.07. Allocations...................................................74
ARTICLE 9
REPRESENTATIONS AND WARRANTIES OF ELIGIBLE SUBSIDIARIES
SECTION 9.01. Corporate Existence and Power.................................74
SECTION 9.02. Corporate and Governmental Authorization;
Contravention.................................................74
SECTION 9.03. Binding Effect................................................74
SECTION 9.04. Taxes.........................................................75
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ARTICLE 10
GUARANTY
SECTION 10.01. The Guaranty.................................................75
SECTION 10.02. Guaranty Unconditional.......................................75
SECTION 10.03. Discharge Only Upon Payment In Full; Reinstatement In
Certain Circumstances........................................76
SECTION 10.04. Waiver by the Company........................................76
SECTION 10.05. Subrogation..................................................76
SECTION 10.06. Stay of Acceleration.........................................77
SECTION 10.07. Continuing Guaranty..........................................77
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Notices......................................................77
SECTION 11.02. No Waivers...................................................78
SECTION 11.03. Expenses; Indemnification....................................78
SECTION 11.04. Sharing of Set-offs..........................................78
SECTION 11.05. Amendments and Waivers.......................................79
SECTION 11.06. Successors and Assigns.......................................79
SECTION 11.07. Collateral...................................................81
SECTION 11.08. Governing Law; Submission to Jurisdiction....................81
SECTION 11.09. Counterparts; Integration; Effectiveness.....................82
SECTION 11.10. WAIVER OF JURY TRIAL.........................................82
SECTION 11.11. Confidentiality..............................................82
EXHIBIT A - Pricing Schedule
EXHIBIT B - Note
EXHIBIT C - Money Market Quote Request
EXHIBIT D - Invitation for Money Market Quotes
EXHIBIT E - Money Market Quote
EXHIBIT F-1 - Opinion of Counsel for the Company
and United States Counsel for BetzDearborn Canada
EXHIBIT F-2 - Opinion of Canadian Counsel
for BetzDearborn Canada
EXHIBIT G - Opinion of Special Counsel
for the Agents
EXHIBIT H - Form of Election to Participate
EXHIBIT I - Form of Election to Terminate
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EXHIBIT J - Matters to be covered in the Opinions of Counsel for the
Eligible Subsidiary and the Company
EXHIBIT K - Assignment and Assumption Agreement
EXHIBIT L - Commitment Schedule
EXHIBIT M - Acceptance Note
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CREDIT AGREEMENT dated as of October 20, 1997 among BETZDEARBORN INC.,
BETZDEARBORN CANADA INC., the BANKS parties hereto, and THE CHASE MANHATTAN BANK
and THE CHASE MANHATTAN BANK OF CANADA, as Administrative Agents.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have the
following meanings:
"Absolute Rate Auction" means a solicitation of Money Market Quotes setting
forth Money Market Absolute Rates pursuant to Section 2.04.
"Acceptance Fee" means the fee payable in Canadian Dollars to each Bank in
respect of Bankers' Acceptances computed in accordance with Section 2.03(d).
"Acceptance Note" has the meaning set forth in Section 2.03(f).
"Acceptance Note Bank" has the meaning set forth in Section 2.03(f).
"Adjusted CD Rate" has the meaning set forth in Section 2.08(b).
"Administrative Agent" means the General Administrative Agent or the
Canadian Administrative Agent, as the context may require, and "Administrative
Agents" means both of them. Any reference to the Administrative Agent in
connection with (i) any notice given by or to the Administrative Agent, (ii) any
fees or other payments paid to the Administrative Agent, (iii) any determination
of any interest rate made by the Administrative Agent or (iv) any other action
taken by the Administrative Agent (x) with respect to the Canadian Subfacility,
shall refer to the Canadian Administrative Agent and (y) with respect to the US
Subfacility, shall refer to the General Administrative Agent.
"Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent (with a copy to the Company) duly
completed by such Bank.
"Affiliate" means (i) any Person that directly, or indirectly through one
or more intermediaries, controls the Company (a "Controlling Person") or (ii)
any Person (other than the Company or a Subsidiary) which is controlled by or is
under common control with a Controlling Person. As used herein, the term
"control" means possession, directly or indirectly, of the power to vote 10% or
more of any class of voting securities of a Person or to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any of the Administrative Agents, the Documentation Agent or
the Syndication Agent, and "Agents" means any two or more of the foregoing.
"Alternate Interest Period" has the meaning set forth in Section 2.02(b).
"Alternate Term" has the meaning set forth in Section 2.03(b).
"Alternative Currency" means the respective lawful currencies of the United
Kingdom, Belgium, France, Germany, Canada, Italy and Japan; provided that any
other currency (except Dollars) shall also be an Alternative Currency if (i) the
Company requests, by notice to the Administrative Agent, that such currency be
included as an additional Alternative Currency for purposes of this Agreement,
(ii) such currency is freely transferable and is freely convertible into Dollars
in the London foreign exchange market, (iii) deposits in such currency are
customarily offered to banks in the London interbank market and (iv) the
Administrative Agent, by notice to the Borrowers and the Banks, approves (which
approval shall not be unreasonably withheld) the inclusion of such currency as
an additional Alternative Currency for purposes hereof. The Administrative
Agent's approval of any such additional Alternative Currency may be limited to a
specified maximum Dollar Amount or a specified period of time or both.
"Alternative Currency Loan" means a Money Market Loan that is made in an
Alternative Currency in accordance with the applicable Notice of Borrowing.
"Applicable BA Discount Rate" means (i) with respect to any Schedule I
Bank, as applicable to a Bankers' Acceptance being purchased by such Schedule I
Bank on any day, the average (as determined by the Administrative Agent) of the
respective percentage discount rates (expressed to two decimal places and
rounded upward, if necessary, to the nearest 1/100th of 1%) quoted to the
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Administrative Agent by each Schedule I Reference Bank as the percentage
discount rate at which such Schedule I Reference Bank would, in accordance with
its normal practices, at or about 10:00 A.M. (Toronto time) on such day, be
prepared to purchase bankers' acceptances accepted by such Schedule I Reference
Bank having a term and face amount comparable to the term and face amount of
such Bankers' Acceptance and (ii) with respect to any Schedule II Bank, as
applicable to a Bankers' Acceptance being purchased by such Schedule II Bank on
any day, the lesser of (x) the average (as determined by the Administrative
Agent) of the respective percentage discount rates (expressed to two decimal
places and rounded upward, if necessary, to the nearest 1/100th of 1%) quoted to
the Administrative Agent by each Schedule II Reference Bank as the percentage
discount rate at which such Schedule II Reference Bank would, in accordance with
its normal practices, at or about 10:00 A.M. (Toronto time) on such day, be
prepared to purchase bankers' acceptances accepted by such Schedule II Reference
Bank having a term and a face amount comparable to the term and face amount of
such Bankers' Acceptance and (y) the rate that is 0.10% per annum in excess of
the rate determined pursuant to clause (i) of this definition in connection with
the relevant issuance of Bankers' Acceptances.
"Applicable Lending Office" means (i) with respect to any US Bank, its US
Lending Office and (ii) with respect to any Canadian Bank, its Canadian Lending
Office.
"Approved Amount" means (i) with respect to Dollars, $10,000,000 or any
larger multiple of $1,000,000, (ii) with respect to Canadian Dollars,
C$10,000,000 or any larger multiple of C$1,000,000 and (iii) with respect to any
other currency, a comparable amount of such currency as determined by the
Administrative Agent and the Company.
"Assessment Rate" has the meaning set forth in Section 2.08(b).
"Assignee" has the meaning set forth in Section 11.06(c).
"BA Discount Proceeds" means proceeds in respect of any Bankers' Acceptance
to be purchased by a Bank on any day under Section 2.03, in an amount (rounded
to the nearest whole Canadian cent, and with one-half of one Canadian cent being
rounded up) calculated on such day by dividing:
(a) the face amount of such Bankers' Acceptance; by
(b) the sum of one plus the product of:
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(i) the Applicable BA Discount Rate (expressed as a decimal)
applicable to such Bankers' Acceptance; and
(ii) a fraction, the numerator of which is the number of days
remaining in the term of such Bankers' Acceptance and the
denominator of which is 365;
with such product being rounded up or down to the fifth
decimal place and .000005 being rounded up.
"BA Margin" means a rate per annum determined in accordance with the
Pricing Schedule.
"Bank" means a Canadian Bank or a US Bank.
"Bankers' Acceptance" means a ▇▇▇▇ of exchange denominated in Canadian
Dollars drawn by a Borrower and accepted by a Canadian Bank pursuant to Section
2.03; provided that, to the extent the context shall require, each Acceptance
Note shall be deemed to be a Bankers' Acceptance.
"Bankruptcy Remote Subsidiary" means any Subsidiary of the Company created
in connection with a Permitted Securitization Transaction which has no material
creditors other than the purchaser or lender related to such Permitted
Securitization Transaction and the Company or any Subsidiary of the Company that
is the originator and seller or contributor of accounts receivable to such
Subsidiary in connection with a Permitted Securitization Transaction.
"Base Rate Loan" means a Canadian Base Rate Loan or a US Base Rate Loan.
"Benefit Arrangement" means at any time an employee benefit plan within the
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and
which is maintained or otherwise contributed to by any member of the ERISA
Group.
"BetzDearborn Canada" means BetzDearborn Canada Inc., a corporation
amalgamated under the laws of Ontario, and its successors.
"Borrower" means the Company or any Eligible Subsidiary, as the context may
require, and their respective successors, and "Borrowers" means all of the
foregoing. As the context may permit, the terms "Borrower" and
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"Borrowers" include the Company in its capacity as guarantor of the obligations
of the other Borrowers hereunder.
"Borrowing" means the aggregation of Loans of one or more Banks to be made
to a single Borrower pursuant to Article 2 on the same date, all of which Loans
are of the same Class, Type (subject to Article 8) and currency and, in the case
of Fixed Rate Loans, have the same initial Interest Period.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in New York City are authorized by law to close; provided
that if such term is used with reference to Canadian Loans or Bankers'
Acceptances such day shall also be a day on which commercial banks in Toronto
are open for business; and provided further if such term is used with reference
to a Euro-Dollar Loan or a Money Market Loan, such day shall also be a day on
which commercial banks are open for international business (including dealings
in deposits of the relevant currency) in London and (in the case of a Money
Market Loan denominated in a currency other than Dollars) in the jurisdiction of
the Payment Office.
"Canadian Administrative Agent" means The Chase Manhattan Bank of Canada in
its capacity as administrative agent for the Canadian Banks under the Canadian
Subfacility, and its successors in such capacity.
"Canadian Bank" means each Bank or other financial institution listed on
the signature pages hereof as a Canadian Bank, each Assignee which becomes a
Canadian Bank pursuant to Section 11.06(c), and their respective successors.
"Canadian Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the rate of interest per annum established by The Chase Manhattan
Bank of Canada in Toronto as the reference rate of interest then in effect for
determining interest rates on commercial loans denominated in Dollars made by it
in Canada and (ii) the sum of one-half of one percent plus the Federal Funds
Rate for such day.
"Canadian Base Rate Loan" means (i) a Canadian Loan denominated in Dollars
which bears interest at the Canadian Base Rate pursuant to the applicable Notice
of Committed Borrowing or Notice of Interest Rate Election or the provisions of
Article 8 or (ii) an overdue amount which was a Canadian Base Rate Loan
immediately before it became overdue.
"Canadian Commitment" means (i) with respect to each Canadian Bank listed
on the signature pages hereof, the amount set forth opposite its name on the
Commitment Schedule under the heading "Canadian Commitment" and (ii) with
5
respect to each Assignee which becomes a Canadian Bank pursuant to Section 8.06
or 11.06(c), the amount of the Canadian Commitment thereby assumed by it, in
each case as such amount may be reduced from time to time pursuant to Sections
2.10, 2.13, and 11.06(c) or increased from time to time pursuant to Section 2.10
or 11.06(c). All Canadian Commitments are denominated in Dollars.
"Canadian Dollars" and "C$" mean the lawful currency of Canada.
"Canadian Lending Office" means, as to each Canadian Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Canadian Lending Office)
or such other office, branch or affiliate of such Canadian Bank as it may
hereafter designate as its Canadian Lending Office by notice to the Company and
the Administrative Agent; provided that any Canadian Bank may so designate
separate Canadian Lending Offices for its Canadian Loans of different Types and
currencies, in which case all references herein to the Canadian Lending Office
of such Canadian Bank shall be deemed to refer to any or all of such offices, as
the context may require.
"Canadian Loan" means a Committed Loan made pursuant to Section 2.01(b).
Canadian Loans may be denominated in Canadian Dollars (as Canadian Prime Rate
Loans) or in Dollars (as Canadian Base Rate Loans or Euro-Dollar Loans);
provided that the aggregate Canadian Outstandings of all Canadian Banks may not
exceed the aggregate amount of the Canadian Commitments.
"Canadian Outstandings" means, as to any Canadian Bank at any time, an
amount equal to the sum of the aggregate outstanding Dollar Amount of its
Canadian Loans at such time and the aggregate Dollar Amount of Bankers'
Acceptances accepted by it and outstanding at such time.
"Canadian Prime Rate" means, for any day, a rate per annum equal to the
higher of (i) the rate of interest per annum established by The Chase Manhattan
Bank of Canada as the reference rate of interest then in effect for determining
interest rates on commercial loans denominated in Canadian Dollars made by it in
Canada and (ii) the sum of 1/2 of 1% plus the CDOR Rate for such day.
"Canadian Prime Rate Loan" means (i) a Canadian Loan denominated in
Canadian Dollars which bears interest at the Canadian Prime Rate pursuant to the
applicable Notice of Committed Borrowing or Notice of Interest Rate Election or
(ii) an overdue amount which was a Canadian Prime Rate Loan immediately before
it became overdue.
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"Canadian Subfacility" means the credit facility extended to the Borrowers
pursuant to Sections 2.01(b) and 2.03.
"CD Base Rate" has the meaning set forth in Section 2.08(b).
"CD Loan" means (i) a Committed Loan which is a US Loan denominated in
Dollars bearing interest at a CD Rate pursuant to the applicable Notice of
Committed Borrowing or Notice of Interest Rate Election or (ii) an overdue
amount which was a CD Loan immediately before it became overdue.
"CD Margin" means a rate per annum determined in accordance with the
Pricing Schedule.
"CD Rate" means a rate of interest determined pursuant to Section 2.08(b)
on the basis of an Adjusted CD Rate.
"CD Reference Banks" means Bank of America National Trust and Savings
Association, The Chase Manhattan Bank and ▇▇▇▇▇▇ Guaranty Trust Company of New
York.
"CDOR Rate" means on any date, the per annum rate of interest which is the
rate based on an average rate applicable to Canadian Dollar bankers' acceptances
for a term of 30 days appearing on the "Reuters Screen CDOR Page" (as defined in
the International Swap Dealer Association, Inc. definitions, as modified or
amended from time to time) as of 10:00 A.M. (Toronto time) on such date, or if
such date is not a Business Day, then on the immediately preceding Business Day;
provided, however, if such rate does not appear on the Reuters Screen CDOR Page
as contemplated, then the CDOR Rate on any date shall be calculated as the
arithmetic mean of the rates for the term referred to above applicable to
Canadian Dollar bankers' acceptances quoted by the Schedule I Reference Banks as
of 10:00 A.M. (Toronto time) on such date, or if such date is not a Business
Day, then on the immediately preceding Business Day.
"Class" has the meaning set forth in Section 1.03.
"Closing Date" means the date on or after the Effective Date on which the
General Administrative Agent shall have received the documents specified in or
pursuant to Section 3.01.
"Commitment" means a Canadian Commitment or a US Commitment, and
"Commitments" means all or any combination of the foregoing, as the context may
require.
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"Commitment Schedule" means the schedule set forth in Exhibit L hereto.
"Committed Loan" means a loan made by a Bank pursuant to Section 2.01;
provided that, if any such loan or loans (or portions thereof) are combined or
subdivided pursuant to a Notice of Interest Rate Election, the term "Committed
Loan" shall refer to the combined principal amount resulting from such
combination or to each of the separate principal amounts resulting from such
subdivision, as the case may be.
"Company" means BetzDearborn Inc., a Pennsylvania corporation, and its
successors.
"Company's 1996 Form 10-K" means the Company's annual report on Form 10-K
for 1996, as filed with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934.
"Consolidated Assets" means at any date the assets of the Company and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated Debt" means at any date the Debt of the Company and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated EBITDA" means, for any fiscal period, Consolidated Net Income
for such period plus, to the extent deducted in determining Consolidated Net
Income for such period, the aggregate amount of (i) Consolidated Interest
Expense, (ii) income tax expense and (iii) depreciation and amortization
expense.
"Consolidated Interest Expense" means, for any period, the interest expense
of the Company and its Consolidated Subsidiaries determined on a consolidated
basis for such period.
"Consolidated Net Income" means, for any fiscal period, the net income of
the Company and its Consolidated Subsidiaries, determined on a consolidated
basis for such period, exclusive of the effect of any extraordinary or other
non-recurring gain or loss (such as non-recurring restructuring or integration
costs as a result of an acquisition).
"Consolidated Net Worth" means at any date the consolidated shareholders'
equity of the Company and its Consolidated Subsidiaries determined as of such
date (other than any amount attributable to stock which is required to be
redeemed or is redeemable at the option of the holder, if certain
8
events or conditions occur or exist or otherwise), excluding the effect thereon
of foreign currency translation gains and losses arising after June 30, 1996.
"Consolidated Subsidiary" means at any date any Subsidiary or other entity
the accounts of which would be consolidated with those of the Company in its
consolidated financial statements if such statements were prepared as of such
date.
"Credit Event" means any Borrowing or issuance of Bankers' Acceptances
hereunder.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable, construction retentions and similar
items arising in the ordinary course of business, (iv) all obligations of such
Person as lessee which are capitalized in accordance with generally accepted
accounting principles, (v) all non-contingent obligations (and, for purposes of
Section 5.10 and the definitions of Material Debt and Material Financial
Obligations, all contingent obligations) of such Person to reimburse any bank or
other Person in respect of amounts paid under a letter of credit or similar
instrument, (vi) all Debt secured by a Lien on any asset of such Person up to
the greater of fair market value or book value of such asset, whether or not
such Debt is otherwise an obligation of such Person and (vii) all Debt of others
Guaranteed by such Person. Notwithstanding the foregoing, "Debt" shall not
include any obligations that have been defeased in accordance with generally
accepted accounting principles.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Derivatives Obligations" of any Person means all obligations of such
Person in respect of any rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
9
"Documentation Agent" means Bank of America National Trust and Savings
Association in its capacity as documentation agent in respect of this Agreement.
"Dollar Amount" means, at any time:
(i) with respect to any Dollar-Denominated Loan, the principal amount
thereof then outstanding;
(ii) with respect to any Alternative Currency Loan, the principal
amount thereof then outstanding in the relevant Alternative Currency,
converted to Dollars in accordance with Section 2.20; and
(iii) with respect to any Bankers' Acceptance, the face amount
thereof, converted to Dollars in accordance with Section 2.20.
"Dollar-Denominated Loan" means a Loan that is made in Dollars in
accordance with the applicable Notice of Borrowing.
"Dollars" and the sign "$" mean the lawful currency of the United States.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in Section 2.08(b).
"Drafts" has the meaning set forth in Section 2.03(b)(ii).
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 11.09.
"Eighty Percent-Owned Consolidated Subsidiary" means any Consolidated
Subsidiary of which at least 80% of the shares of capital stock or other
ownership interests are at the time directly or indirectly owned by the Company.
"Election to Participate" means an Election to Participate substantially in
the form of Exhibit H hereto.
"Election to Terminate" means an Election to Terminate substantially in the
form of Exhibit I hereto.
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"Eligible Subsidiary" means (i) BetzDearborn Canada and (ii) any Eighty
Percent-Owned Consolidated Subsidiary of the Company as to which an Election to
Participate shall have been delivered to the General Administrative Agent and as
to which an Election to Terminate shall not have been delivered to the General
Administrative Agent. Each such Election to Participate and Election to
Terminate shall be duly executed on behalf of such Consolidated Subsidiary and
the Company in such number of copies as the General Administrative Agent may
request. The delivery of an Election to Terminate shall not affect any
obligation of an Eligible Subsidiary theretofore incurred. The General
Administrative Agent shall promptly give notice to the Canadian Administrative
Agent and the Banks of the receipt of any Election to Participate or Election to
Terminate.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to the
environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, Hazardous Substances or wastes or the
clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA Group" means the Company, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Company or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"Euro-Dollar Loan" means (i) a Committed Loan denominated in Dollars which
bears interest at a Euro-Dollar Rate pursuant to the applicable Notice of
Committed Borrowing or Notice of Interest Rate Election or (ii) an overdue
amount which was a Euro-Dollar Loan immediately before it became overdue.
"Euro-Dollar Margin" means a rate per annum determined in accordance with
the Pricing Schedule.
"Euro-Dollar Rate" means a rate of interest determined pursuant to Section
2.08(c) on the basis of a London Interbank Offered Rate.
11
"Euro-Dollar Reference Banks" means the principal London offices of Bank of
America National Trust and Savings Association, The Chase Manhattan Bank and
▇▇▇▇▇▇ Guaranty Trust Company of New York.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents).
"Events of Default" has the meaning set forth in Section 6.01.
"Existing Credit Agreement" means the Credit Agreement dated as of June 20,
1996 among the Company, BetzDearborn Canada Inc. (formerly ▇▇▇▇ Canada Inc.),
the banks parties thereto and ▇▇▇▇▇▇ Guaranty Trust Company of New York, as
agent, as amended to the Closing Date.
"Facility Fee Rate" has the meaning set forth in the Pricing Schedule.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (i) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (ii) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate quoted to The
Chase Manhattan Bank on such day on such transactions as determined by the
Administrative Agent.
"Fixed Rate Loan" means any Loan other than a Base Rate Loan or a Canadian
Prime Rate Loan.
"General Administrative Agent" means The Chase Manhattan Bank in its
capacity as administrative agent for the US Banks under the US Subfacility and
for all Banks under this Agreement generally, and its successors in such
capacity.
12
"Group " means at any time:
(a) a group of Loans consisting of (i) all Committed Loans of the same
Class to a single Borrower which are Base Rate Loans at such time, (ii) all
Committed Loans under the Canadian Subfacility which are Canadian Prime Rate
Loans at such time or (iii) all Committed Loans of the same Class to a single
Borrower which are Fixed Rate Loans of the same Type and currency having the
same Interest Period at such time, provided that, if a Committed Loan of any
particular Bank is converted to or made as a Base Rate Loan or a Canadian Prime
Rate Loan pursuant to Article 8, such Loan shall be included in the same Group
or Groups of Loans from time to time as it would have been in if it had not been
so converted or made; or
(b) a group of Bankers' Acceptances issued on a single date and having the
same maturity date.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by agreement to keep-well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for the
purpose of assuring in any other manner the holder of such Debt of the payment
thereof or to protect such holder against loss in respect thereof (in whole or
in part), provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or otherwise
hazardous substance, including petroleum, its derivatives, by-products and other
hydrocarbons, or any substance having any constituent elements displaying any of
the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 11.03(b).
"Information Memorandum" means the confidential descriptive memorandum
dated September 19, 1997 furnished to the Banks in connection with the
transactions contemplated hereby.
"Interest Period" means: (1) with respect to each Euro-Dollar Loan, the
period commencing on the date of such borrowing specified in the applicable
13
Notice of Borrowing or on the date specified in the applicable Notice of
Interest Rate Election and ending one, two, three or six months (or, with the
prior consent of each Bank making such Euro-Dollar Loan, any shorter period or
longer period of time not exceeding twelve months) thereafter, as the Borrower
may elect in the applicable notice; provided that:
(a) any Interest Period which would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day; and
(b) 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, subject to the further
proviso below, end on the last Business Day of a calendar month;
(2) with respect to each CD Loan, the period commencing on the date of such
borrowing specified in the applicable Notice of Borrowing or on the date
specified in the applicable Notice of Interest Rate Election and ending 30, 60,
90 or 180 days (or, with the prior consent of each Bank making such CD Loan, any
shorter period or longer period of time not exceeding 360 days) thereafter, as
the Borrower may elect in the applicable notice; provided that 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 Business Day falls in
another calendar month, in which case such Interest Period shall end on the next
preceding Business Day;
(3) with respect to each Money Market LIBOR Loan, the period commencing on
the date of borrowing specified in the applicable Notice of Borrowing and ending
such whole number of months or other period of time thereafter as the Borrower
may elect in accordance with Section 2.04; provided that:
(a) 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
Business Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Business Day; and
(b) 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, subject to the further
proviso below, end on the last Business Day of a calendar month;
14
(4) with respect to each Money Market Absolute Rate Loan, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing and ending such number of days thereafter as the Borrower may elect in
accordance with Section 2.04; provided that any Interest Period which would
otherwise end on a day which is not a Business Day shall, subject to the further
proviso below, be extended to the next succeeding Euro-Dollar Business Day;
provided further that any Interest Period for any Loan of any Type which would
otherwise end after the Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"LIBOR Auction" means a solicitation of Money Market Quotes setting forth
Money Market Margins based on the London Interbank Offered Rate pursuant to
Section 2.04.
"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge
or security interest, or any other type of preferential arrangement that has the
practical effect of creating a security interest, in respect of such asset. For
the purposes of this Agreement, the Company or any Subsidiary shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
"Loan" means a Committed Loan or a Money Market Loan and "Loans" means all
or any combination of the foregoing, as the context may require.
"London Interbank Offered Rate" has the meaning set forth in Section
2.08(c).
"Material Debt" means Debt (other than (i) the Notes, (ii) Debt of a
Subsidiary to the Company or (iii) Debt of the Company or a Subsidiary to a
Subsidiary) of the Company and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, in an aggregate principal or face
amount exceeding $25,000,000.
"Material Financial Obligations" means a principal or face amount of Debt
and/or payment or collateralization obligations in respect of Derivatives
Obligations of the Company and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, exceeding in the aggregate
$25,000,000.
15
"Material Plan" means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $25,000,000.
"Material Subsidiary" means (i) any Subsidiary which is a "significant
subsidiary" within the meaning of Regulation S-X of the Securities and Exchange
Commission as in effect on the date hereof and (ii) any Eligible Subsidiary.
"Money Market Absolute Rate" has the meaning set forth in Section 2.04(d).
"Money Market Absolute Rate Loan" means a loan to be made by a Bank
pursuant to an Absolute Rate Auction.
"Money Market LIBOR Loan" means a loan to be made by a Bank pursuant to a
LIBOR Auction.
"Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section 2.04(d)(ii)(C).
"Money Market Quote" means an offer by a Bank to make a Money Market Loan
in accordance with Section 2.04.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five-year period.
"Notes" means promissory notes of a Borrower, substantially in the form of
Exhibit B hereto, evidencing the obligation of such Borrower to repay the Loans
made to it, and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as defined in
Section 2.02) or a Notice of Money Market Borrowing (as defined in Section
2.04(f)).
16
"Notice of Interest Rate Election" has the meaning set forth in Section
2.11.
"Notice of Request for Acceptances" has the meaning set forth in Section
2.03.
"Notice of Utilization" means a Notice of Borrowing or a Notice of Request
for Acceptances.
"Parent" means, with respect to any Bank, any Person controlling such Bank.
"Participant" has the meaning set forth in Section 11.06(b).
"Payment Office" means the office or account of the Administrative Agent at
or to which payments hereunder are to be made, which shall be (i) in the case of
payments in Dollars with respect to the US Subfacility, the office of the
Administrative Agent in New York City referred in Section 11.01, (ii) in the
case of payments in Canadian Dollars or in Dollars with respect to the Canadian
Subfacility, the office of the Administrative Agent in Toronto, Ontario referred
to in Section 11.01 and (iii) in the case of any other payments in an
Alternative Currency, such office or account as the Administrative Agent may
specify for such purpose by notice to the affected Borrowers and Banks.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Receivables Disposition" means any transfer (by way of sale,
pledge or otherwise) by the Company or any Subsidiary to any other Person
(including a Bankruptcy Remote Subsidiary) of accounts receivable and other
rights to payment (whether constituting accounts, chattel paper, instruments,
general intangibles or otherwise and including the right to payment of interest
or finance charges) and related contract and other rights and property
(including all general intangibles, collections and other proceeds relating
thereto, all security therefor (and the property subject thereto), all
guarantees and other agreements or arrangements of whatsoever character from
time to time supporting such right to payment, and all other right, title and
interest in goods relating to a sale which gave rise to such right of payment)
in connection with a Permitted Securitization Transaction.
"Permitted Securitization Transaction" means any receivables purchase or
financing transaction pursuant to which the Company or a Subsidiary (including a
Bankruptcy Remote Subsidiary) sells or grants a security interest in
17
accounts receivable of the Company or its Subsidiaries (and related rights and
property as described in the definition of Permitted Receivables Disposition) or
an undivided interest therein, provided that (i) the aggregate principal or
invested amount outstanding at any one time under all such facilities shall not
exceed $150,000,000 and (ii) the recourse of the purchaser or lender with
respect to such transaction for losses resulting from an obligor's failure to
pay a receivable due to credit problems is limited to such accounts receivable
or an interest therein, and the collections thereof.
"Person" means an individual, a corporation, a limited liability company, a
partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"Pricing Schedule" means the schedule set forth in Exhibit A hereto.
"Prime Rate" means the rate of interest publicly announced by The Chase
Manhattan Bank in New York City from time to time as its Prime Rate.
"Quarterly Dates" means each March 31, June 30, September 30 and December
31.
"Reference Banks" means the CD Reference Banks, the Euro-Dollar Reference
Banks, the Schedule I Reference Banks or the Schedule II Reference Banks, as the
context may require, and "Reference Bank" means any one of such Reference Banks.
"Refund" has the meaning set forth in Section 8.04(h).
"Register" has the meaning set forth in Section 2.06(a)
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Related" has the meaning set forth in Section 1.04.
18
"Required Banks" means at any time Banks having at least 51% of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding (or having accepted) at least 51% of the aggregate unpaid
Dollar Amount of the Loans and Bankers' Acceptances.
"Revolving Credit Period" means the period from and including the Effective
Date to but not including the Termination Date.
"S&P" means Standard & Poor's Ratings Services.
"Sale-Leaseback Transaction" means any arrangement with any Person
providing for the leasing by the Company or any Subsidiary of any property that,
or of any property similar to and used for substantially the same purposes as
any other property that, has been or is to be sold, assigned, transferred or
otherwise disposed of by the Company or any of its Subsidiaries to such Person
with the intention of entering into such a lease.
"Schedule I Bank" means any Canadian Bank named on Schedule I to the Bank
Act (Canada).
"Schedule I Reference Banks" means Bank of Montreal and Royal Bank of
Canada.
"Schedule II Bank" means any Canadian Bank named on Schedule II to the Bank
Act (Canada).
"Schedule II Reference Banks" means ▇.▇. ▇▇▇▇▇▇ Canada, Bank of America
Canada and The Chase Manhattan Bank of Canada.
"Spot Rate" means, on any day, with respect to any Alternate Currency, the
rate at which such Alternate Currency may be exchanged into Dollars, as set
forth at approximately 10:30 A.M. (New York City time), on such date on the
Reuters World Currency Page for such Alternate Currency. In the event that such
rate does not appear on any Reuters World Currency Page, the Spot Rate shall be
determined by reference to the applicable Bloomberg System page, or, in the
event that such rate does not appear on such page, such other publicly available
service for displaying exchange rates as may be agreed upon by the
Administrative Agent and the Company, or, in the absence of such agreement, such
Spot Rate shall instead be the spot rate of exchange of the Administrative Agent
in the market where its foreign currency exchange operations in respect of such
Alternate Currency are then being conducted, at or about 10:30 A.M. (New York
City time), on such date for the purchase of Dollars for delivery two Business
Days later; provided that if at the time of such determination, for any
19
reason, no such spot rate is being quoted, the Administrative Agent may use any
reasonable method it deems appropriate to determine such rate, and such
determination shall be conclusive absent manifest error.
"Subsidiary" means, as to any Person, any corporation or other entity of
which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person; unless
otherwise specified, "Subsidiary" means a Subsidiary of the Company.
"Syndication Agent" means ▇.▇. ▇▇▇▇▇▇ Securities Inc. in its capacity as
arranger and syndication agent in respect of this Agreement.
"Termination Date" means October 20, 2002, or, if such day is not a
Business Day, the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case the Termination Date shall be the next
preceding Business Day.
"Total Capital" means, at any date, the sum of (x) Consolidated Debt plus
(y) consolidated shareholders' equity of the Company and its Consolidated
Subsidiaries (including for this purpose any amount attributable to stock which
is required to be redeemed or is redeemable at the option of the holder, if
certain events or conditions occur or exist or otherwise), excluding the effect
thereon of foreign currency translation gains and losses arising after June 30,
1996, in each case determined at such date.
"Total Commitment" means, at any date, the sum of the aggregate amount of
the US Commitments and the aggregate amount of the Canadian Commitments.
"Total Outstandings" means, at any date, the sum of the aggregate Dollar
Amount of all US Loans outstanding at such date plus the aggregate Canadian
Outstandings of all Canadian Banks at such date.
"Type" has the meaning set forth in Section 1.03.
"Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA (or other applicable standard),
exceeds (ii) the fair market value of all Plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date for
such Plan, but only to the
20
extent that such excess represents a potential liability of a member of the
ERISA Group to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the States
and the District of Columbia, but excluding its territories and possessions.
"US Bank" means each bank or other financial institution listed on the
signature pages hereof as a US Bank, each Assignee which becomes a US Bank
pursuant to Section 11.06(c), and their respective successors.
"US Base Rate" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal
Funds Rate for such day.
"US Base Rate Loan" means (i) a US Loan denominated in Dollars which bears
interest at the US Base Rate pursuant to the applicable Notice of Committed
Borrowing or Notice of Interest Rate Election or the provisions of Article 8 or
(ii) an overdue amount which was a Base Rate Loan immediately before it became
overdue.
"US Commitment" means, (i) with respect to each US Bank listed on the
signature pages hereof, the amount set forth opposite its name on the Commitment
Schedule under the heading "US Commitment" and (ii) with respect to each
Assignee which becomes a US Bank pursuant to Section 8.06 or 11.06(c), the
amount of the US Commitment thereby assumed by it, in each case as such amount
may be reduced from time to time pursuant to Section 2.10 or Section 11.06(c) or
increased from time to time pursuant to Section 2.10 or Section 11.06(c).
"US Lending Office" means, as to each Bank, its office located at its
address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its US Lending Office) or such other office as
such Bank may hereafter designate as its US Lending Office by notice to the
Company and the Administrative Agent; provided that any Bank may so designate
separate US Lending Offices for its US Loans of different Types and currencies,
in which case all references herein to the US Lending Office of such Bank shall
be deemed to refer to any or all of such offices, as the context may require.
"US Loan" means (i) a Committed Loan made pursuant to Section 2.01(a) or
(ii) a Money Market Loan. US Loans may be US Base Rate Loans, CD Loans,
Euro-Dollar Loans or Money Market Loans; provided that the aggregate Dollar
Amount of US Loans outstanding may not exceed the aggregate amount of the US
Commitments.
21
"US Subfacility" means the credit facility extended to the Borrowers
pursuant to Sections 2.01(a) and 2.04.
"Wholly-Owned Consolidated Subsidiary" means any Consolidated Subsidiary
all of the shares of capital stock or other ownership interests of which (except
directors' qualifying shares) are at the time directly or indirectly owned by
the Company.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time, applied
on a basis consistent in all material respects (except for changes to which the
Company's independent public accountants do not take exception) with the most
recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Banks; provided that, if the Company
notifies the Administrative Agent that the Company wishes to amend any covenant
in Article 5 to eliminate the effect of any change in generally accepted
accounting principles on the operation of such covenant (or if the
Administrative Agent notifies the Company that the Required Banks wish to amend
Article 5 for such purpose), then the Company's compliance with such covenant
shall be determined on the basis of generally accepted accounting principles in
effect immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Company and the Required
Banks.
SECTION 1.03. Classes and Types of Loans. Loans hereunder are
differentiated by Class and by Type. The "Class" of a Loan or Loans (or of a
Borrowing comprised of such Loans or, in the case of Committed Loans, of a
Commitment to make such Loans) refers to the determination whether such Loans
are Canadian Loans or US Loans. The "Type" of a Loan refers to the basis upon
which interest accrues on such Loan (e.g., Euro-Dollar Loans, Canadian Prime
Rate Loans and Money Market Absolute Loans are each a Type of Loan). Loans
hereunder (and Borrowings comprised of such Loans) may be identified by both
Class and Type (e.g., a Euro-Dollar Canadian Borrowing is a Borrowing comprised
of Canadian Loans denominated in Dollars which bear interest at a Euro-Dollar
Rate).
SECTION 1.04. Related Banks. Each Canadian Bank is, or is an affiliate of,
a US Bank (although not all US Banks are affiliates of Canadian Banks at the
date of this Agreement). The term "Related" when used with respect to a US Bank
or Canadian Bank means the Canadian Bank or US Bank, as the case may
22
be, of which such former Bank is an affiliate (or which is the same Person as
such former Bank).
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend.
(a) US Subfacility. During the Revolving Credit Period, each US Bank
severally agrees, on the terms and conditions set forth in this Agreement, to
make loans denominated in Dollars to any Borrower pursuant to this subsection
(a) from time to time in amounts such that the aggregate Dollar Amount of
Committed Loans by such US Bank to all Borrowers at any one time outstanding
which are US Loans shall not exceed the amount of its US Commitment.
(b) Canadian Subfacility. During the Revolving Credit Period, each Canadian
Bank severally agrees, on the terms and conditions set forth in this Agreement,
to make loans denominated in Dollars or in Canadian Dollars to any Borrower
pursuant to this subsection (b) from time to time in amounts such that the
aggregate Canadian Outstandings of such Canadian Bank to all Borrowers at any
one time outstanding shall not exceed the amount of its Canadian Commitment.
(c) Approved Amounts. Each Borrowing under this Section shall be in an
Approved Amount (except that any such Borrowing may be in the aggregate amount
available under the Commitments of the relevant Class in accordance with Section
3.02) and shall be made from the several Banks ratably in proportion to their
respective Commitments of the relevant Class. Within the foregoing limits, a
Borrower may borrow under this Section, repay, or to the extent permitted by
Section 2.13, prepay Loans and reborrow at any time during the Revolving Credit
Period under this Section.
SECTION 2.02. Notice of Committed Borrowing. (a) The Borrower shall give
the Administrative Agent notice (a "Notice of Committed Borrowing") not later
than 10:30 A.M. (Eastern time) on (w) the date of each Base Rate Borrowing or
Canadian Prime Rate Borrowing, (x) the second Business Day (or, if the desired
Interest Period requires the prior consent of each Bank making such Loan, the
fourth Business Day) before each CD Borrowing and (y) the third Business Day
(or, if the desired Interest Period requires the prior consent of each Bank
23
making such Loan, the fifth Business Day) before each Euro-Dollar Borrowing,
specifying:
(i) the date of such Borrowing, which shall be a Business Day;
(ii) the aggregate amount of such Borrowing;
(iii) the Class and Type of the Loans comprising such Borrowing; and
(iv) in the case of a Fixed Rate Borrowing, the duration of the
initial Interest Period applicable thereto, subject to the provisions of
the definition of Interest Period.
(b) If the Borrower specifies an Interest Period that requires the prior
consent of each Bank making such Loan with respect to any Euro-Dollar Borrowing
or any CD Borrowing (in each case, an "Alternate Interest Period") in any Notice
of Committed Borrowing or Notice of Interest Rate Election and the
Administrative Agent shall not have received from any Bank written objection to
such Alternate Interest Period by 9:30 A.M. (Eastern time) on the second
Business Day after receipt by the Administrative Agent of such notice, then each
Bank shall be deemed to have consented to such Alternate Interest Period;
provided that such notice specifies that the consent of each Bank making such
Loan is required and that if such Bank does not timely object as set forth
above, then such Bank shall be deemed to have consented. If any Bank timely
objects as set forth above to any request for an Alternate Interest Period, then
the Administrative Agent shall promptly notify the Borrower and the Borrower
shall deliver a new Notice of Committed Borrowing or Notice of Interest Rate
Election (which may be included as an alternative election in the original
notice) specifying a different election within the applicable time periods
specified in the definition of Interest Period. If the Borrower fails to so
timely deliver such a new notice, then the related Loans shall be made as (or
continued as or converted into) Base Rate Loans (if denominated in Dollars) or
Canadian Prime Rate Loans (if denominated in Canadian Dollars).
SECTION 2.03. Bankers' Acceptances. (a) Acceptance Commitment. Any Borrower
may issue Bankers' Acceptances denominated in Canadian Dollars, for purchase by
the Canadian Banks under the Canadian Subfacility, in each case in accordance
with the provisions of this Section 2.03.
(b) Procedures.
(i) The Borrower shall notify the Administrative Agent not later than
10:00 A.M. (Toronto time) one Business Day prior to the date of any Credit
Event by way of Bankers' Acceptances (a "Notice of Request for
Acceptances"), which notice shall specify (x) the date of such Credit Event
24
(which shall be a Business Day), (y) the aggregate face amount of Banker's
Acceptances to be issued (which shall be an Approved Amount) and (z) the
maturity date thereof (which shall be a Business Day 30, 60, 90 or 180 days
(excluding days of grace) after the date of issuance thereof, or such
shorter or longer term as has been consented to by each Canadian Bank, and
which shall in any event not be later than the Termination Date); provided
that if the Borrower wishes to specify a maturity date that requires the
consent of each Canadian Bank (an "Alternate Term") the Borrower shall
deliver a Notice of Request for Acceptances not later than 10:00 AM
(Toronto time) two Business Days prior to the date of such Credit Event. If
the Borrower specifies an Alternate Term in any Notice of Request for
Acceptances and the Administrative Agent shall not have received from any
Canadian Bank written objection to such Alternate Term by 10:00 A.M.
(Toronto time) on the first Business Day after receipt by the
Administrative Agent of such notice, then each Canadian Bank shall be
deemed to have consented to such Alternate Term; provided that such notice
specifies that the consent of each Canadian Bank is required and that if
such Canadian Bank does not timely object as set forth above, then such
Canadian Bank shall be deemed to have consented. If any Canadian Bank
timely objects as set forth above to any request for an Alternate Term,
then the Administrative Agent shall promptly notify the Borrower and the
Borrower shall deliver a new Notice of Request for Acceptances (which may
be included as an alternative election in the original notice) specifying a
different election of a maturity date 30, 60, 90 or 180 days after the date
of issuance of such Bankers' Acceptance.
(ii) To facilitate the acceptance of Bankers' Acceptances under this
Agreement, each Borrower intending to issue Bankers' Acceptances may, as it
considers necessary, provide to the Administrative Agent drafts ("Drafts"),
in form satisfactory to the Administrative Agent, duly executed and
endorsed in blank by such Borrower in quantities sufficient for each
Canadian Bank to fulfill its obligations under this Section 2.03. Each
Canadian Bank is hereby authorized to issue such Bankers' Acceptances
endorsed in blank in such face amounts as may be determined by such
Canadian Bank; provided that (x) the aggregate amount thereof so issued by
any Canadian Bank in connection with any Credit Event is equal to the
aggregate amount of Bankers' Acceptances required to be accepted by such
Canadian Bank in connection with such Credit Event and (y) as provided in
Section 2.03(b)(iv) the face amount of each Bankers' Acceptance shall be
C$100,000 or any multiple thereof. No Canadian Bank shall be responsible or
liable for its failure to accept a Bankers' Acceptance if the cause of such
failure is, in whole or in part, the failure of any Borrower to provide
duly executed and endorsed Drafts to the Administrative Agent on
25
a timely basis. Each Canadian Bank will exercise the same degree of care
with respect to such Drafts as it would exercise with respect to the
management of its own property. Each Canadian Bank shall maintain a record
with respect to Bankers' Acceptances (A) received by it from the
Administrative Agent in blank hereunder, (B) voided by it for any reason,
(C) accepted by it hereunder, (D) purchased by it hereunder and (E)
cancelled at their respective maturities. Each Canadian Bank further agrees
to retain such records in the manner and for the statutory periods provided
in the various Canadian provincial or federal statutes and regulations
which apply to such Canadian Bank.
(iii) Drafts of any Borrower to be accepted as Banker's Acceptances
hereunder shall be duly executed on behalf of such Borrower.
Notwithstanding that any person whose signature appears on any Bankers'
Acceptance as a signatory for any Borrower may no longer be an authorized
signatory for such Borrower at the date of issuance of a Bankers'
Acceptance, such signature shall nevertheless be valid and sufficient for
all purposes as if such authority had remained in force at the time of such
issuance, and any such Bankers' Acceptance so signed shall be binding on
such Borrower.
(iv) Promptly following receipt of a Notice of Request for
Acceptances, the Administrative Agent shall so advise the Canadian Banks of
the contents thereof and shall advise each Canadian Bank of the face amount
of Bankers' Acceptances to be accepted by it and the term thereof. The
aggregate face amount of Bankers' Acceptances to be accepted by a Canadian
Bank shall be determined by the Administrative Agent on a pro rata basis by
reference to the respective Canadian Commitments, except that, if the face
amount of a Bankers' Acceptance, which would otherwise be accepted by a
Canadian Bank, would not be C$100,000 or a larger multiple thereof, such
face amount shall be increased or reduced by the Administrative Agent in
its discretion to the nearest multiple of C$100,000.
(v) Each Bankers' Acceptance to be accepted by a Canadian Bank shall
be accepted at its Canadian Lending Office.
(vi) On the date of each issuance of Bankers' Acceptances in
accordance with this Section 2.03, each Canadian Bank shall purchase from
the Borrower each Bankers' Acceptance accepted by it for a purchase price
equal to the applicable BA Discount Proceeds determined on the basis of the
Applicable BA Discount Rate, and shall remit to the Administrative Agent
for the account of the Borrower the BA Discount
26
Proceeds so determined less the Acceptance Fee payable by the Borrower to
such Bank under Section 2.03(d) in respect of such Bankers' Acceptances.
(vii) Each Canadian Bank may at any time and from time to time hold,
sell, rediscount or otherwise dispose of any or all Bankers' Acceptances
accepted and purchased by it.
(viii) Each Borrower waives presentment for payment and any other
defense to payment of any amounts then due to a Canadian Bank in respect of
a Bankers' Acceptance accepted by it pursuant to this Agreement which might
exist solely by reason of such Bankers' Acceptance being held, at the
maturity thereof, by such Canadian Bank in its own right, and each Borrower
agrees not to claim any days of grace if such Canadian Bank as holder sues
such Borrower on the Bankers' Acceptances for payment of the amount payable
by such Borrower thereunder.
(c) Each Bankers' Acceptance shall mature, and the face amount thereof
shall be due and payable, on the maturity date specified in such Bankers'
Acceptance. Any overdue amount of any Bankers' Acceptance shall bear interest,
payable on demand, calculated daily until paid at a rate per annum equal to the
sum of 2% plus the Canadian Prime Rate. Any payment of a maturing Bankers'
Acceptance shall be made as provided in Section 2.14 (notwithstanding that any
Canadian Bank or any other Person may be the holder thereof at maturity). Any
such payment shall be made by deposit at the Payment Office and shall satisfy
the applicable Borrower's obligations under the maturing Bankers'Acceptance to
which it relates, and the Canadian Bank issuing the applicable Bankers'
Acceptance shall thereafter be solely responsible for the payment of such
Bankers' Acceptance.
(d) An Acceptance Fee shall be payable by the Borrower to each Canadian
Bank in advance (in the manner specified in Section 2.03(b)(vi)) upon the
issuance of a Bankers' Acceptance to be accepted by such Canadian Bank
calculated at the rate per annum equal to the BA Margin, such Acceptance Fee to
be calculated on the face amount of such Bankers" Acceptance and to be computed
on the basis of the number of days in the term of such Bankers' Acceptance.
(e) Upon the occurrence of any Event of Default, and in addition to any
other rights or remedies of any Canadian Bank and the Administrative Agent
hereunder, any Canadian Bank or the Administrative Agent as and by way of
collateral security (or such alternate arrangement as may be agreed upon by
27
the relevant Borrower and such Bank or the Administrative Agent, as applicable)
shall be entitled to deposit and retain in an account to be maintained by the
Administrative Agent (bearing interest at the Administrative Agent's rates as
may be applicable in respect of other deposits of similar amounts for similar
terms) amounts which are received by such Canadian Bank or the Administrative
Agent from such Borrower hereunder or as proceeds of the exercise of any rights
or remedies of any Canadian Bank or the Administrative Agent hereunder against
such Borrower, to the extent such amounts may be required to satisfy any
contingent or unmatured obligations or liabilities of such Borrower to the
Canadian Banks or the Administrative Agent, or any of them hereunder.
(f) (i) It is understood that from time to time certain Schedule II Banks
may not be authorized to or may, as a matter of general corporate policy, elect
not to accept Drafts (each, an "Acceptance Note Bank"); accordingly, any
Acceptance Note Bank may instead purchase Acceptance Notes of a Borrower in
accordance with the provisions of Section 2.03(b) in lieu of creating Bankers'
Acceptances for its account.
(ii) In connection with any request by a Borrower for the creation of
Bankers' Acceptances, such Borrower shall deliver to each Acceptance Note Bank
non-interest bearing promissory notes (each, an "Acceptance Note") of such
Borrower, substantially in the form of Exhibit M, having the same maturity as
the Bankers' Acceptances to be created and in an aggregate principal amount
equal to the aggregate amount of the Bankers' Acceptances that would otherwise
have been required to be accepted by such Acceptance Note Bank. Each Acceptance
Note Bank hereby agrees to purchase Acceptance Notes from any Borrower at the
Applicable BA Discount Rate which would have been applicable if a Draft had been
accepted by it (less any Acceptance Fee which would have been paid pursuant to
Section 2.03(d) if such Acceptance Note Bank had created a Bankers' Acceptance),
and such Acceptance Notes shall be governed by the provisions of this Section
2.03 as if they were Bankers' Acceptances.
SECTION 2.04. Money Market Borrowings. (a) The Money Market Option. In
addition to Committed Borrowings pursuant to Section 2.01(a), any Borrower may,
as set forth in this Section, request the US Banks during the Revolving Credit
Period to make offers to make Money Market Loans to such Borrower denominated in
Dollars or in any Alternative Currency; provided that the aggregate Dollar
Amount of Money Market Loans denominated in Alternative Currencies may not
exceed $75,000,000. The Banks may, but shall have no obligation to, make such
offers and such Borrower may, but shall have no obligation to, accept any such
offers in the manner set forth in this Section, all within the limits of the US
Subfacility.
28
(b) Money Market Quote Request. When a Borrower wishes to request offers to
make Money Market Loans under this Section, it shall transmit to the
Administrative Agent by telex or facsimile transmission a Money Market Quote
Request substantially in the form of Exhibit C hereto so as to be received not
later than 10:30 A.M. (Eastern time) on (x) the fifth Business Day prior to the
date of Borrowing proposed therein, in the case of a LIBOR Auction or (y) the
Business Day next preceding the date of Borrowing proposed therein, in the case
of an Absolute Rate Auction (or, in either case, such other time or date as the
Company and the Administrative Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Business Day;
(ii) the currency in which such Borrowing is to be denominated, which
shall be Dollars or an Alternative Currency;
(iii) the aggregate amount of such Borrowing, which shall be an
Approved Amount;
(iv) the duration of the Interest Period applicable thereto, subject
to the provisions of the definition of Interest Period, and
(v) whether the Money Market Quotes requested are to set forth a Money
Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Business Days (or such other number of days
as the Company and the Administrative Agent may agree) of any other Money Market
Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt of a Money
Market Quote Request, the Administrative Agent shall send to the Banks by telex
or facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit D hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance with
this Section.
29
(d) Submission and Contents of Money Market Quotes. (i) Each Bank may
submit a Money Market Quote containing an offer or offers to make Money Market
Loans in response to any Invitation for Money Market Quotes. Each Money Market
Quote must comply with the requirements of this subsection (d) and must be
submitted to the Administrative Agent by telex or facsimile transmission at its
offices specified in or pursuant to Section 11.01 not later than (x) 2:00 P.M.
(Eastern time) on the fourth Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction or (y) 9:30 A.M. (Eastern time) on the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Company and the Administrative Agent
shall have mutually agreed and shall have notified to the Banks not later than
the date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective); provided that
Money Market Quotes submitted by the Administrative Agent (or any affiliate of
the Administrative Agent) in the capacity of a Bank may be submitted, and may
only be submitted, if the Administrative Agent or such affiliate notifies the
Borrower of the terms of the offer or offers contained therein not later than
(x) one hour prior to the deadline for the other Banks, in the case of a LIBOR
Auction or (y) 15 minutes prior to the deadline for the other Banks, in the case
of an Absolute Rate Auction. Subject to Articles 3 and 6, any Money Market Quote
so made shall be irrevocable except with the written consent of the
Administrative Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit E hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for which each
such offer is being made, which principal amount (w) may be greater
than or less than the Commitment of the quoting Bank, (x) must be
$5,000,000 or a larger multiple of $1,000,000 (or a comparable amount
in an Alternative Currency as determined by the Administrative Agent),
(y) may not exceed the principal amount of Money Market Loans for
which offers were requested and (z) may be subject to an aggregate
limitation as to the principal amount of Money Market Loans for which
offers being made by such quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable London Interbank Offered Rate (the "Money Market Margin")
offered for each such Money Market Loan,
30
expressed as a percentage (specified to the nearest 1/10,000th of 1%)
to be added to or subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest
per annum (specified to the nearest 1/10,000th of 1%) (the "Money
Market Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit E hereto or
does not specify all of the information required by subsection (d)(ii)
above;
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i) above.
(e) Notice to Borrower. The Administrative Agent shall promptly notify the
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that is
in accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Administrative
Agent unless such subsequent Money Market Quote is submitted solely to correct a
manifest error in such former Money Market Quote. The Administrative Agent's
notice to the Borrower shall specify (A) the aggregate principal amount of Money
Market Loans for which offers have been received for each Interest Period
specified in the related Money Market Quote Request, (B) the respective
principal amounts and Money Market Margins or Money Market Absolute Rates, as
the case may be, so offered and (C) if applicable, limitations on the aggregate
principal amount of Money Market Loans for which offers in any single Money
Market Quote may be accepted.
31
(f) Acceptance and Notice by Borrower. Not later than 10:30 A.M. (Eastern
time) on (x) the third Business Day prior to the proposed date of Borrowing, in
the case of a LIBOR Auction or (y) the proposed date of Borrowing, in the case
of an Absolute Rate Auction (or, in either case, such other time or date as the
Company and the Administrative Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective), the Borrower shall notify the Administrative Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money Market
Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market Borrowing may
not exceed the applicable amount set forth in the related Money Market
Quote Request;
(ii) the principal amount of each Money Market Borrowing must be an
Approved Amount;
(iii) acceptance of offers may only be made on the basis of ascending
Money Market Margins or Money Market Absolute Rates, as the case may be;
and
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the requirements
of this Agreement.
(g) Allocation by Administrative Agent. If offers are made by two or more
Banks with the same Money Market Margins or Money Market Absolute Rates, as the
case may be, for a greater aggregate principal amount than the amount in respect
of which such offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted shall
be allocated by the Administrative Agent among such Banks as nearly as possible
(in such multiples as the Administrative Agent may deem appropriate) in
proportion to the aggregate principal amounts of such offers. Determinations by
the Administrative Agent of the amounts of Money Market Loans shall be
conclusive in the absence of manifest error.
SECTION 2.05. Notice to Banks; Funding of Loans. (a) Upon receipt of a
Notice of Borrowing, the Administrative Agent shall promptly notify each Bank
32
having a Commitment of the related Class of the contents thereof and of such
Bank's share (if any) of such Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the Borrower.
(b) On the date of each Borrowing, each Bank participating therein shall
(i) if such Borrowing is to be made in Dollars or Canadian Dollars, make
available its share of such Borrowing in such currency not later than 2:00 P.M.
(Eastern time) in immediately available funds to the Administrative Agent at the
Payment Office or (ii) if such Borrowing is to be made in another Alternative
Currency, make available its share of such Borrowing in such Alternative
Currency (in such funds as may then be customary for the settlement of
international transactions in such Alternative Currency) to the account of the
Administrative Agent at such time and Payment Office as shall have been notified
by the Administrative Agent to the Banks by at least two Business Days' notice.
Unless the Administrative Agent determines that any applicable condition
specified in Article 3 has not been satisfied, the Administrative Agent will
make the funds so received from the Banks available to the Borrower at the
Payment Office.
(c) Unless the Administrative Agent shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not make available to the
Administrative Agent such Bank's share of such Borrowing, the Administrative
Agent may assume that such Bank has made such share available to the
Administrative Agent on the date of such Borrowing in accordance with subsection
(b) of this Section and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
If and to the extent that such Bank shall not have so made such share available
to the Administrative Agent, such Bank and the Borrower severally agree to repay
to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) if such amount is repaid by the relevant Borrower,
a rate per annum equal to the interest rate applicable thereto pursuant to
Section 2.08 (or, if higher, the rate determined by the Administrative Agent to
be its cost of funds (which determination shall be conclusive absent manifest
error)) and (ii) if such amount is repaid by such Bank, the rate determined by
the Administrative Agent to be its cost of funds (which determination shall be
conclusive absent manifest error). If such Bank shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.06. Registry. (a) Each Administrative Agent shall maintain a
register (a "Register") on which it will record the Commitment (if any) of the
33
applicable Class of each Bank, each Loan of such Class made by such Bank and
each repayment of any such Loan made by such Bank. Any such recordation by an
Administrative Agent on a Register shall be conclusive, absent manifest error.
With respect to any Bank, the assignment or other transfer of the Commitment (if
any) of the applicable Class of such Bank and the rights to the principal of,
and interest on, any Loan of such Class made pursuant to this Agreement shall
not be effective until such assignment or other transfer is recorded on the
applicable Register and otherwise complies with Section 11.06(c). The
registration of assignment or other transfer of all or part of any Commitments,
Loans and Notes for a Bank shall be recorded by the applicable Administrative
Agent on the applicable Register only upon the acceptance by such Administrative
Agent of a properly executed and delivered Assignment and Assumption Agreement
referred to in Section 11.06(c). Each Register shall be available at the offices
where kept by the applicable Administrative Agent for inspection by the Company
and any Bank at any reasonable time upon reasonable prior notice to such
Administrative Agent. Each Bank shall record on its internal records (including
computerized systems) the foregoing information as to its own Commitment and
Loans. Failure to make any such recordation, or any error in such recordation,
shall not affect the obligations of any Borrower hereunder.
(b) Each Borrower hereby agrees that, upon the request of any Bank at any
time, any or all of such Bank's Loans shall be evidenced by one or more Notes of
such Borrower payable to the order of such Bank and representing the obligation
of such Borrower to pay the unpaid principal amount of such Loans to such
Borrower made by such Bank, with interest as provided herein on the unpaid
principal amount of such Loans from time to time outstanding.
SECTION 2.07. Maturity of Loans.
(a) Each Committed Loan shall mature, and the principal amount thereof
shall be due and payable, together with accrued interest thereon, on the
Termination Date.
(b) Each Money Market Loan included in any Money Market Borrowing shall
mature, and the principal amount thereof shall be due and payable, together with
accrued interest thereon, on the last day of the Interest Period applicable to
such Borrowing.
SECTION 2.08. Interest Rates. (a) Each Base Rate Loan shall bear interest
on the outstanding principal amount thereof, for each day from the date such
Loan is made until it becomes due, at a rate per annum equal to the Canadian
Base Rate (in the case of Canadian Base Rate Loans) or the US Base Rate (in the
case of US Base Rate Loans) for such day. Such interest shall be payable
quarterly in arrears
34
on each Quarterly Date and, with respect to the principal amount of any Base
Rate Loan converted to a CD Loan or a Euro-Dollar Loan, on the date such Base
Rate Loan is so converted. Any overdue principal of or overdue interest on any
Base Rate Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of 2% plus the Canadian Base Rate or US
Base Rate, as applicable, for such day.
(b) Each CD Loan shall bear interest on the outstanding principal amount
thereof, for each day during each Interest Period applicable thereto, at a rate
per annum equal to the sum of the CD Margin for such day plus the Adjusted CD
Rate applicable to such Interest Period; provided that if any CD Loan shall, as
a result of the concluding proviso to the definition of Interest Period, have an
Interest Period of less than 30 days, such CD Loan shall bear interest during
such Interest Period at the rate applicable to Base Rate Loans during such
period. Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than 90 days, at intervals of 90
days after the first day thereof. Any overdue principal of or overdue interest
on any CD Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of 2% plus the higher of (i) the sum of the
CD Margin plus the Adjusted CD Rate applicable to such Loan at the date such
payment was due and (ii) the Base Rate for such day.
The "Adjusted CD Rate" applicable to any Interest Period means a rate per
annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [------------] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
----------
* The amount in brackets being rounded upward, if necessary, to the next
higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the rate of
interest determined by the Administrative Agent to be the average (rounded
upward, if necessary, to the next higher 1/100 of 1%) of the prevailing rates
per annum bid at 10:00 A.M. (New York City time) (or as soon thereafter as
practicable) on the first day of such Interest Period by two or more New York
certificate of deposit dealers of recognized standing for the purchase at face
35
value from each CD Reference Bank of its certificates of deposit in an amount
comparable to the principal amount of the CD Loan of such CD Reference Bank to
which such Interest Period applies and having a maturity comparable to such
Interest Period.
"Domestic Reserve Percentage" means for any day that percentage (expressed
as a decimal) which is in effect on such day, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
maximum reserve requirement (including without limitation any basic,
supplemental or emergency reserves) for a member bank of the Federal Reserve
System in New York City with deposits exceeding five billion dollars in respect
of new non-personal time deposits in dollars in New York City having a maturity
comparable to the related Interest Period and in an amount of $100,000 or more.
The Adjusted CD Rate shall be adjusted automatically on and as of the effective
date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in effect on
such day which is payable by a member of the Bank Insurance Fund classified as
adequately capitalized and within supervisory subgroup "A" (or a comparable
successor assessment risk classification) within the meaning of 12 C.F.R. ss.
327.4(a) (or any successor provision) to the Federal Deposit Insurance
Corporation (or any successor) for such Corporation's (or such successor's)
insuring time deposits at offices of such institution in the United States. The
Adjusted CD Rate shall be adjusted automatically on and as of the effective date
of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding principal
amount thereof, for each day during each Interest Period applicable thereto, at
a rate per annum equal to the sum of the Euro-Dollar Margin for such day plus
the London Interbank Offered Rate for Dollars applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than three months, at intervals
of three months after the first day thereof.
The "London Interbank Offered Rate" applicable to any Interest Period for
any currency (other than Belgian francs) means the rate appearing on Page 3740
or 3750 of the Telerate Service (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing rate
quotations comparable to those currently provided on such page of the Telerate
Service, as determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to deposits in
such currency in the London interbank market) at approximately 11:00 A.M.
(London time) two Business Days prior to the commencement of such Interest
Period, as
36
the rate for deposits in such currency with a maturity comparable to such
Interest Period. In the event that such rate is not so available at such time
for any reason, then the "London Interbank Offered Rate" with respect to such
Euro-Dollar Borrowing for such Interest Period shall be the average (rounded
upward, if necessary, to the next higher 1/16 of 1%) of the respective rates per
annum at which deposits in such currency are offered to each of the Euro-Dollar
Reference Banks in the London interbank market at approximately 11:00 A.M.
(London time) two Business Days before the first day of such Interest Period in
an amount approximately equal to the principal amount of the Euro-Dollar Loan of
such Euro-Dollar Reference Bank to which such Interest Period is to apply and
for a period of time comparable to such Interest Period.
(d) Any overdue principal of or overdue interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the higher of (i) the sum of 2% plus the Euro-Dollar Margin for
such day plus the London Interbank Offered Rate applicable to such Loan at the
date such payment was due and (ii) the sum of 2% plus the Euro-Dollar Margin for
such day plus the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which one day (or, if such amount
due remains unpaid more than three Business Days, then for such other period of
time not longer than three months as the Administrative Agent may select)
deposits in Dollars or the relevant Alternative Currency in an amount
approximately equal to such overdue payment due to each of the Euro-Dollar
Reference Banks are offered to such Euro-Dollar Reference Bank in the London
interbank market for the applicable period determined as provided above (or, if
the circumstances described in clause (a) or (b) of Section 8.01 shall exist, at
a rate per annum equal to the sum of 2% plus the Base Rate for such day).
(e) Each Money Market LIBOR Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the sum of the London Interbank Offered Rate for such
Interest Period (determined in accordance with Section 2.08(c) as if the related
Money Market LIBOR Borrowing were a Euro-Dollar Borrowing and (i) in the case of
a Borrowing in an Alternative Currency (other than Belgian francs), based on the
London Interbank Offered Rate for such Alternative Currency rather than for
Dollars and (ii) in the case of a Borrowing in Belgian francs, based on the
comparable quotations for Belgian francs rather than for such other currencies)
plus (or minus) the Money Market Margin quoted by the Bank making such Loan in
accordance with Section 2.04. Each Money Market Absolute Rate Loan shall bear
interest on the outstanding principal amount thereof, for the Interest Period
applicable thereto, at a rate per annum equal to the Money Market Absolute Rate
quoted by the Bank making such Loan in accordance with Section 2.04. Such
interest shall be payable for each Interest Period on the last day thereof and,
37
if such Interest Period is longer than three months, at intervals of three
months after the first day thereof. Any overdue principal of or overdue interest
on any Money Market Loan shall bear interest, payable on demand, for each day
until paid at a rate per annum equal to (i) in the case of Money Market Loans
denominated in Dollars, the sum of 2% plus the Base Rate for such day and (ii)
in the case of Money Market Loans denominated in an Alternative Currency, at a
rate per annum determined in accordance with Section 2.07(d) as if such Money
Market Loans were Euro-Dollar Loans, but based on comparable quotations for such
Alternative Currency rather than for Dollars.
(f) Each Canadian Prime Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the Canadian Prime Rate for such day.
Such interest shall be payable quarterly in arrears on each Quarterly Date. Any
overdue principal of or overdue interest on any Canadian Prime Rate Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the Canadian Prime Rate for such day.
(g) The Administrative Agent shall determine each interest rate applicable
to the Loans hereunder. The Administrative Agent shall give prompt notice to the
Borrower and the participating Banks of each rate of interest so determined, and
its determination thereof shall be conclusive in the absence of manifest error.
(h) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Administrative Agent as contemplated by this Agreement. If any
Reference Bank does not furnish a timely quotation, the Administrative Agent
shall determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Banks or, if none of
such quotations is available on a timely basis, the provisions of Section 8.01
shall apply.
SECTION 2.09. Fees. (a) Facility Fee. The Borrowers shall pay to the
Administrative Agent for the account of the Banks ratably a facility fee at the
Facility Fee Rate (determined daily in accordance with the Pricing Schedule).
Such facility fee shall accrue (i) from and including the Effective Date to but
excluding the date of termination of the Commitments in their entirety, on the
daily aggregate amount of the Commitments (whether used or unused) and (ii) from
and including such date of termination to but excluding the date the Loans and
Bankers' Acceptances shall be repaid in their entirety, on the daily aggregate
Total Outstandings. Fees accrued pursuant to clause (i) of the preceding
sentence shall be allocated among the Banks in accordance with the respective
Dollar Amounts of their Commitments, while fees accrued pursuant to clause (ii)
shall be
38
allocated among the Banks ratably in proportion to the respective outstanding
Dollar Amounts of Loans made and Bankers' Acceptances accepted by them. The
portion of the facility fee that shall be the obligation of each Borrower other
than the Company or BetzDearborn Canada for any period shall be based on the
average daily aggregate outstanding Dollar Amount of Loans to and Bankers'
Acceptances issued by such Borrower during such period in relation to the
average daily aggregate amount of the Commitments during such period, all as
determined by the Administrative Agent, which determination shall be conclusive
absent manifest error. Betz Dearborn Canada shall be responsible for any
remaining portion of the facility fee allocated to the Canadian Commitments, and
the Company shall be solely responsible for payment of the balance of the
facility fee.
(b) Utilization Fee. The Borrowers shall pay to the Administrative Agent
for the account of the Banks a utilization fee at the rate of 0.05% per annum.
Such utilization fee shall accrue from and including October 20, 1998 to but
excluding the date of termination of the Commitments in their entirety, on an
amount equal to the lesser of (i) the excess of the daily aggregate Total
Outstandings over $375,000,000 and (ii) the sum of the daily aggregate Dollar
Amount of all Committed Loans outstanding which are US Loans and the daily
aggregate Canadian Outstandings of all Canadian Banks. Such fee shall be
allocated among the Banks ratably on the basis of the respective daily
outstanding aggregate Dollar Amounts of Committed Loans made and Bankers'
Acceptances accepted by them. The portion of the utilization fee that shall be
the obligation of each Borrower for any period shall be based on the average
daily aggregate outstanding Dollar Amount of Committed Loans to and Bankers'
Acceptances issued by such Borrower during such period in relation to the
average daily aggregate outstanding Dollar Amount of all Committed Loans and
Bankers' Acceptances during such period, all as determined by the Administrative
Agent, which determination shall be conclusive absent manifest error.
(c) Payments. Accrued fees under this Section shall be payable in Dollars
quarterly in arrears on each Quarterly Date and on the date of termination of
the Commitments in their entirety (and, if later, the date the Loans shall be
repaid in their entirety).
SECTION 2.10. Optional Termination, Reduction or Reallocation of
Commitments. (a) During the Revolving Credit Period, the Company may, upon at
least three Business Days' notice to the Administrative Agent, (i) terminate the
Commitments of either Class in their entirety at any time, if no Loans of such
Class (and, in the case of the Canadian Subfacility, no Bankers' Acceptances)
are outstanding at such time or (ii) ratably reduce from time to time by an
aggregate amount of $25,000,000 or a larger multiple of $1,000,000, the
aggregate of the
39
Commitments of either Class in excess of the aggregate outstanding Dollar Amount
of Loans of such Class (together with, in the case of the Canadian Subfacility,
the aggregate outstanding Dollar Amount of Bankers' Acceptances). Any
termination or reduction of the Commitments of either Class pursuant to this
subsection (a) shall be permanent (subject to subsection (b)).
(b) During the Revolving Credit Period, the Company may (i) upon at least
three Business Days' notice to the Administrative Agents, ratably reduce from
time to time by an Approved Amount the aggregate amount of the Canadian
Commitments in excess of the aggregate Canadian Outstandings of all Canadian
Banks or (ii) if and to the extent the Canadian Commitments shall have
previously been reduced pursuant to this subsection (b), (x) upon at least three
Business Days' notice to the Administrative Agents prior to the first day of a
calendar quarter or (y) upon at least 10 Business Days' notice to Administrative
Agents at any other time (but subject in the case of this clause (y) to the
written consent of all Canadian Banks), ratably increase the aggregate amount of
the Canadian Commitments by an Approved Amount (such increase to be effective on
the date specified in such notice); provided that after giving effect to such
increase of the Canadian Commitments (and the consequent decrease in the US
Commitments) (A) the aggregate amount of the Canadian Commitments shall not
exceed $250,000,000, (B) the aggregate outstanding Dollar Amount of US Loans
which are Committed Loans made by any Bank shall not exceed the US Commitment of
such Bank and (C) the aggregate outstanding Dollar Amount of the US Loans shall
not exceed the aggregate amount of the US Commitments. An increase or decrease
in the Canadian Commitment of any Canadian Bank pursuant to this subsection (b)
shall result in an automatic and simultaneous decrease or increase,
respectively, in an equal amount in the US Commitment of its Related US Bank.
SECTION 2.11. Method of Electing Interest Rates. (a) The Loans included in
each Committed Borrowing shall bear interest initially at the Type of interest
rate specified by the Borrower in the applicable Notice of Committed Borrowing.
Thereafter, the Borrower may from time to time elect to change or continue the
Type of interest rate borne by each Group of Loans (subject in each case to the
provisions of Article 8), as follows:
(i) if such Loans are Base Rate Loans, the Borrower may elect to
convert such Loans to Euro-Dollar Loans of the same Class or, if such Base
Rate Loans are US Loans, to CD Loans;
(ii) if such Loans are CD Loans, the Borrower may elect to convert
such Loans to Base Rate Loans or Euro-Dollar Loans of the same Class or
elect to continue such Loans as CD Loans for an additional Interest Period,
subject to Section 2.15 in the case of any such conversion
40
or continuation effective on any day other than the last day of the then
current Interest Period applicable to such Loans; and
(iii) if such Loans are Euro-Dollar Loans, the Borrower may elect to
convert such Loans to Base Rate Loans of the same Class or, if such
Euro-Dollar Loans are US Loans, to CD Loans or elect to continue such Loans
as Euro-Dollar Loans of the same Class for an additional Interest Period,
subject to Section 2.15 in the case of any such conversion or continuation
effective on any day other than the last day of the then current Interest
Period applicable to such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Administrative Agent not later than 10:30 A.M. (Eastern
time) on the earlier of (x) the date on which a notice of prepayment would be
required to be given pursuant to Section 2.12 were the Loans to be optionally
prepaid on the effective date of such conversion or continuation and (y) the
date on which a Notice of Committed Borrowing would be required to be given were
the Loans resulting from such conversion or continuation instead to be borrowed
on the effective date thereof. A Notice of Interest Rate Election may, if it so
specifies, apply to only a portion of the aggregate principal amount of the
relevant Group of Loans; provided that (i) such portion is allocated ratably
among the Loans comprising such Group and (ii) the portion to which such Notice
applies, and the remaining portion to which it does not apply, are each an
Approved Amount. If no such notice is timely received prior to the end of an
Interest Period, the Borrower shall be deemed to have elected that all Committed
Loans having such Interest Period be converted to Base Rate Loans (if
denominated in Dollars) or Canadian Prime Rate Loans (if denominated in Canadian
Dollars).
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which such notice
applies;
(ii) the date on which the conversion or continuation selected in such
notice is to be effective, which shall be a Business Day;
(iii) if the Loans comprising such Group are to be converted, the new
Type of Loans and, if the Loans being converted are to be Fixed Rate Loans,
the duration of the next succeeding Interest Period applicable thereto; and
41
(iv) if such Loans are to be continued as Loans of the same Type for
an additional Interest Period, the duration of such additional Interest
Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the Borrower
pursuant to subsection (a) above, the Administrative Agent shall promptly notify
each Bank having a related Loan of the contents thereof and such notice shall
not thereafter be revocable by the Borrower.
(d) An election by the Borrower to change or continue the rate of interest
applicable to any Group of Loans pursuant to this Section shall not constitute a
"Borrowing" subject to the provisions of Section 3.02.
SECTION 2.12. Scheduled Termination of Commitments. The Commitments shall
terminate on the Termination Date and any Loans then outstanding (together with
accrued interest thereon) shall be due and payable on such date.
SECTION 2.13. Optional Prepayments; Collateralization of Bankers'
Acceptances. (a) Subject in the case of any Fixed Rate Borrowing to Section
2.15, any Borrower may, upon notice to the Administrative Agent as provided
below, prepay any Group of Loans in whole at any time, or from time to time in
part in an Approved Amount, by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Notice of
prepayment pursuant to this Section shall be given to the Administrative Agent
not later than 10:30 A.M. (Eastern Time) on (i) the date of prepayment, in the
case of Base Rate Loans or Canadian Prime Rate Loans, (ii) the Business Day
prior to the date of prepayment, in the case of CD Loans and (iii) the third
Business Day prior to the date of prepayment, in the case of Euro-Dollar Loans.
Each such optional prepayment shall be applied to prepay ratably the Loans of
the several Banks included in such Group.
(b) Except as provided in subsection (a) above no Borrower may prepay all
or any portion of the principal amount of any Money Market Loan prior to the
maturity thereof without the consent of the Bank making such Money Market Loan.
(c) Upon receipt of a notice of prepayment pursuant to this Section, the
Administrative Agent shall promptly notify each Bank of the contents thereof and
42
of such Bank's ratable share (if any) of such prepayment and such notice shall
not thereafter be revocable by the Borrower.
(d) Bankers' Acceptances may not be prepaid. The Borrower may, however, at
its option, exercisable upon not less than one Business Day's notice to the
Administrative Agent, elect to deposit with the Administrative Agent Canadian
Dollars in immediately available funds (in an Approved Amount) to be held by the
Administrative Agent, pursuant to collateral arrangements satisfactory to it,
for application to the payment of any Group of Bankers' Acceptances designated
by the Borrower in such notice. If such a deposit is made, then such Bankers'
Acceptances shall (to the extent of such deposit) be deemed no longer
outstanding for purposes of this Agreement.
SECTION 2.14. General Provisions as to Payments. (a) Each payment of
principal of and interest on any Loan shall be made in the currency in which
such Loan was made. Each payment of any Bankers' Acceptance shall be made in
Canadian Dollars. Each payment of principal of and interest on Loans denominated
in Dollars or Canadian Dollars, of Bankers' Acceptances and of fees hereunder
shall be made not later than 2:00 P.M. (Eastern Time) on the date when due, in
immediately available funds, to the Administrative Agent at the Payment Office.
Each payment of principal of and interest on any other Alternative Currency
Loans shall be made in the relevant Alternative Currency in such funds as may
then be customary for the settlement of international transactions in such
Alternative Currency, for the account of the Administrative Agent at such time
and Payment Office as shall have been notified by the Administrative Agent to
the relevant Borrower and Banks by at least two Business Days' notice. The
Administrative Agent will promptly distribute to each Bank its ratable share (if
any) of each such payment received by the Administrative Agent for the account
of the Banks. Whenever any payment of principal of, or interest on, the
Euro-Dollar Loans or the Money Market LIBOR Loans shall be due on a day which is
not a Business Day, the date for payment thereof shall be extended to the next
succeeding Business Day unless such Business Day falls in another calendar
month, in which case the date for payment thereof shall be the next preceding
Business Day. Whenever any payment of principal of, or interest on, the Loans of
any other Type or on Bankers' Acceptances shall be due on a day which is not a
Business Day, the date for payment thereof shall be extended to the next
succeeding Business Day. If the date for any payment of principal is extended by
operation of law or otherwise, interest thereon shall be payable for such
extended time.
(b) Unless the Administrative Agent shall have received notice from a
Borrower prior to the date on which any payment is due from such Borrower to the
Banks hereunder that such Borrower will not make such payment in full, the
43
Administrative Agent may assume that such Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such due
date an amount equal to the amount then due such Bank. If and to the extent that
such Borrower shall not have so made such payment, each Bank shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Bank
together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Administrative Agent, at the rate determined by the Administrative Agent to be
its cost of funds (which determination shall be conclusive absent manifest
error).
SECTION 2.15. Funding Losses. If a Borrower makes any payment of principal
with respect to any Fixed Rate Loan or any Fixed Rate Loan is converted or
continued (pursuant to Article 2, 6 or 8 or otherwise, other than due to Section
8.02(b)) on any day other than the last day of an Interest Period applicable
thereto, or the last day of an applicable period fixed pursuant to Section
2.08(d), or if a Borrower fails to borrow, prepay, convert or continue any Fixed
Rate Loans after notice has been given to any Bank in accordance with Section
2.05(a), 2.13(c) or 2.11(c), such Borrower shall reimburse each Bank within 15
days after demand for any resulting loss or expense reasonably incurred by it
(or by an existing or prospective Participant in the related Loan), including
(without limitation) any loss incurred in obtaining, liquidating or employing
deposits from third parties in the principal amount so prepaid or in the
principal amount which the Borrower failed to borrow, prepay, convert or
continue, but excluding loss of margin for the period after any such payment or
conversion or failure to borrow, prepay, convert or continue, provided that such
Bank shall have delivered to such Borrower a certificate as to the amount of
such loss or expense and showing the calculation thereof, which certificate
shall be conclusive in the absence of manifest error.
SECTION 2.16. Computation of Interest and Fees. Interest based on the
Canadian Base Rate, US Base Rate, Prime Rate or the Canadian Prime Rate and all
Acceptance Fees shall be computed on the basis of a year of 365 days (or, other
than with respect to Acceptance Fees, 366 days in a leap year) and paid for the
actual number of days elapsed (including the first day but excluding the last
day). All other interest and fees shall be computed on the basis of a year of
360 days and paid for the actual number of days elapsed (including the first day
but excluding the last day). For the purposes of this Agreement, whenever any
interest is calculated on the basis of a period of time other than a calendar
year, the annual rate of interest to which each rate of interest determined
pursuant to such calculation is equivalent for the purposes of the Interest Act
(Canada) is such rate as so determined multiplied by the actual number of days
in the calendar year in which the same is to be ascertained and divided by the
number of days used in the basis for such determination.
44
SECTION 2.17. Regulation D Compensation. Each Bank may, so long as such
Bank shall be required to maintain reserves in respect of "Eurocurrency
liabilities" under Regulation D of the Board of Governors of the Federal Reserve
System (or in respect of any other category of liabilities which includes
deposits by reference to which the interest rate on Euro-Dollar Loans is
determined or any category of extensions of credit or other assets that includes
loans by a non-United States office of such Bank to United States residents),
require any Borrower to pay, contemporaneously with each payment of interest on
the Euro-Dollar Loans, additional interest on the related Euro-Dollar Loan of
such Bank at a rate per annum determined by such Bank up to but not exceeding
the excess of (i) (A) the applicable London Interbank Offered Rate divided by
(B) one minus the Euro-Dollar Reserve Percentage over (ii) the applicable London
Interbank Offered Rate. Any Bank wishing to require payment of such additional
interest (x) shall so notify such Borrower and the Administrative Agent, in
which case such additional interest on the Euro-Dollar Loans of such Bank shall
be payable to such Bank at the place indicated in such notice with respect to
each Interest Period commencing at least three Euro-Dollar Business Days after
the giving of such notice and (y) shall notify such Borrower at least five
Euro-Dollar Business Days prior to each date on which interest is payable on the
Euro-Dollar Loans of the amount then due it under this Section.
SECTION 2.18. Judgment Currency. If for the purpose of obtaining judgment
in any court it is necessary to convert a sum due from any Borrower hereunder or
under any of the Notes in the currency expressed to be payable herein or under
the Notes (the "specified currency") into another currency, the parties hereto
agree, to the fullest extent that they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures the Administrative Agent could purchase the specified currency with
such other currency at the Administrative Agent's New York office at 11:00 A.M.
(New York City time) on the Business Day preceding that on which final judgment
is given. The obligations of each Borrower in respect of any sum due to any Bank
or the Administrative Agent hereunder or under any Note shall, notwithstanding
any judgment in a currency other than the specified currency, be discharged only
to the extent that on the Business Day following receipt by such Bank or the
Administrative Agent (as the case may be) of any sum adjudged to be so due in
such other currency such Bank or the Administrative Agent (as the case may be)
may in accordance with normal banking procedures purchase the specified currency
with such other currency; if the amount of the specified currency so purchased
is less than the sum originally due to such Bank or the Administrative Agent, as
the case may be, in the specified currency, each Borrower agrees, to the fullest
extent that it may effectively do so, as a separate obligation and
notwithstanding any such judgment, to indemnify such Bank or the Administrative
Agent, as the case may be, against such loss, and if the amount of
45
the specified currency so purchased exceeds (a) the sum originally due to any
Bank or the Administrative Agent, as the case may be, and (b) any amounts shared
with other Banks as a result of allocations of such excess as a disproportionate
payment to such Bank under Section 11.04, such Bank or the Administrative Agent,
as the case may be, agrees to remit such excess to the appropriate Borrower.
SECTION 2.19. Foreign Costs. (a) If the cost to any Bank of making or
maintaining any Loan or accepting or purchasing any Bankers'Acceptance is
increased, or the amount of any sum received or receivable by any Bank (or its
Applicable Lending Office) is reduced by an amount deemed by such Bank to be
material, by reason of the fact that the Borrower of such Loan or Bankers'
Acceptance is incorporated in, or conducts business in, (i) in the case of US
Loans, a jurisdiction outside the United States of America or (ii) in the case
of Canadian Loans or Bankers' Acceptances, a jurisdiction outside Canada, such
Borrower shall indemnify such Bank for such increased cost or reduction within
15 days after demand by such Bank (with a copy to the Administrative Agent). A
certificate of such Bank claiming compensation under this subsection (a) and
setting forth the additional amount or amounts to be paid to it hereunder shall
be conclusive in the absence of manifest error.
(b) Each Bank will promptly notify the Borrower and the Administrative
Agent of any event of which it has knowledge that will entitle such Bank to
additional compensation pursuant to subsection (a) and will designate a
different Applicable Lending Office if, in the judgment of such Bank, such
designation will avoid the need for, or reduce the amount of, such compensation
and will not be otherwise disadvantageous to such Bank.
SECTION 2.20. Currency Equivalents. (a) The Administrative Agent shall
determine the Dollar Amount of each Alternative Currency Loan and Bankers'
Acceptance as of the date of Borrowing or issuance thereof, and the Dollar
Amount so determined shall be the Dollar Amount of such Alternative Currency
Loan or Bankers' Acceptance for so long as such Loan or Bankers' Acceptance
remains outstanding (appropriately adjusted for any partial prepayment or
collateralization thereof); provided that if and for so long as the aggregate
Canadian Outstandings so determined of all Canadian Banks exceed 50% of the
aggregate amount of the Canadian Commitments, then the Dollar Amount of each
outstanding Alternative Currency Loan and Bankers' Acceptance shall be
determined as of the last Business Day of each calendar month. Each such
determination shall be based on the Spot Rate (i) on the date of the related
Notice of Utilization (in the case of Canadian Loans or Bankers' Acceptances) or
Money Market Quote Request (in the case of Money Market Loans) for purposes of
the initial such determination for any Alternative Currency Loan or Bankers'
46
Acceptance and (ii) the second Business Day prior to the date as of which such
Dollar Amount is to be determined for purposes of any subsequent determination.
The Administrative Agent shall promptly notify the Borrower and the Banks of
each Dollar Amount so determined by it.
(b) If after giving effect to any such determination of a Dollar Amount,
the aggregate Canadian Outstandings so determined of all Canadian Banks exceed
105% of the aggregate amount of the Canadian Commitments, the Borrowers shall
within 30 days take such action pursuant to Section 2.10 and Section 2.13 as may
be necessary to cause the aggregate Canadian Outstandings of all Canadian Banks
to be equal to or less than the aggregate amount of the Canadian Commitments;
provided that such action shall be taken within 10 days if upon such
determination of a Dollar Amount, the sum of the aggregate Dollar Amount of all
outstanding US Loans and the aggregate Canadian Outstandings of all Canadian
Banks exceed the aggregate amount of the Total Commitments.
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing. The closing hereunder shall occur upon receipt by
the General Administrative Agent of the following documents, each dated the
Closing Date unless otherwise indicated:
(a) a duly executed copy of this Agreement and duly executed Notes of each
of the Company and BetzDearborn Canada for the account of each Bank which shall
have requested the same not less than two Business Days prior to the Closing
Date, each such Note to be dated on or before the Closing Date and to comply
with the provisions of Section 2.06;
(b) an opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company and
United States counsel for BetzDearborn Canada, substantially in the form of
Exhibit F-1 hereto and covering such additional matters relating to the
transactions contemplated hereby as the Required Banks may reasonably request;
(c) an opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Verchere, Canadian counsel for BetzDearborn
Canada, substantially in the form of Exhibit F-2 hereto and covering such
additional matters relating to the transactions contemplated hereby as the
Required Banks may reasonably request;
(d) an opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Agents,
substantially in the form of Exhibit G hereto and covering such additional
47
matters relating to the transactions contemplated hereby as the Required Banks
may reasonably request;
(e) all documents the General Administrative Agent may reasonably request
relating to the existence of the Company and BetzDearborn Canada, the corporate
authority for and the validity of this Agreement and the Notes, and any other
matters relevant hereto, all in form and substance satisfactory to the General
Administrative Agent; and
(f) evidence satisfactory to the General Administrative Agent that the
payments contemplated by Section 3.04 have been made.
The General Administrative Agent shall promptly notify the Company and the
Banks of the Closing Date, and such notice shall be conclusive and binding on
all parties hereto.
SECTION 3.02. Borrowings and Acceptances of Bankers' Acceptances. The
obligation of any Bank to make a Loan on the occasion of any Borrowing, and the
obligation of any Canadian Bank to accept or purchase any Bankers' Acceptance,
is subject to the satisfaction of the following conditions:
(a) the fact that the Closing Date shall have occurred on or prior to
October 31, 1997;
(b) receipt by the Administrative Agent of a Notice of Utilization as
required by Section 2.02, 2.03 or 2.04, as the case may be;
(c) the facts that, immediately after such Credit Event, (i) the aggregate
Dollar Amount of all outstanding Loans of the related Class (together with, in
the case of the Canadian Subfacility, the aggregate outstanding Dollar Amount of
Bankers' Acceptances) will not exceed the aggregate amount of the Commitments of
such Class and (ii) the Total Outstandings will not exceed the aggregate amount
of the Total Commitment;
(d) the fact that, immediately before and after such Credit Event, no
Default shall have occurred and be continuing; provided that this clause shall
not be applicable to a Credit Event under the Canadian Subfacility which results
in no increase in the aggregate Canadian Outstandings of all Canadian Banks; and
(e) the fact that the representations and warranties of the Borrower (and,
if the Borrower is an Eligible Subsidiary, of the Company) contained in this
Agreement (except, in the case of any Borrowing after the Closing Date, the
representations and warranties set forth in Section 4.11) shall be true in all
48
material respects on and as of the date of such Credit Event; provided that this
clause shall not be applicable to a Credit Event under the Canadian Subfacility
which results in no increase in the aggregate Canadian Outstandings of all
Canadian Banks.
Each Credit Event hereunder shall be deemed to be a representation and warranty
by the Borrower on the date of such Credit Event as to satisfaction of the
applicable conditions specified in clauses (c), (d) and (e) of this Section.
SECTION 3.03. First Borrowing by Each Eligible Subsidiary. The obligation
of each Bank to make a Loan or to accept or purchase a Bankers' Acceptance on
the occasion of the first Credit Event for each Eligible Subsidiary is subject
to the satisfaction of the following further conditions (except to the extent
previously satisfied pursuant to Section 3.01, in the case of BetzDearborn
Canada):
(a) receipt by the Administrative Agent for the account of each Bank
requesting the same of a duly executed Note of such Eligible Subsidiary, dated
on or before the date of such Borrowing complying with the provisions of Section
2.06;
(b) receipt by the Administrative Agent of an opinion or opinions of
counsel for such Eligible Subsidiary and/or for the Company acceptable to the
Administrative Agent and addressed to the Administrative Agent and the Banks,
substantially to the effect of Exhibit J hereto and covering such additional
matters relating to the transactions contemplated hereby as the Required Banks
may reasonably request; and
(c) receipt by the Administrative Agent of all documents which it may
reasonably request relating to the existence of such Eligible Subsidiary, the
corporate authority for and the validity of the Election to Participate of such
Eligible Subsidiary, this Agreement and the Notes of such Eligible Subsidiary,
and any other matters relevant thereto, all in form and substance satisfactory
to the Administrative Agent.
SECTION 3.04. Termination of Existing Credit Agreement. On the Closing
Date, and subject to the satisfaction of the conditions specified in Section
3.01, (i) the borrowers under the Existing Credit Agreement shall pay all
accrued fees thereunder and all principal of and interest on loans outstanding
thereunder and (ii) the commitments under the Existing Credit Agreement shall
terminate automatically, without further action of any party thereto. The
Company, BetzDearborn Canada and the Banks which are parties to the Existing
Credit Agreement (constituting the "Required Banks" as defined therein) hereby
49
agree to waive any requirement of notice or any limitation on prepayments in
connection with implementation of the foregoing.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Company is a corporation
duly incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No Contravention.
The execution, delivery and performance by the Company of this Agreement and its
Notes are within the corporate powers of the Company, have been duly authorized
by all necessary corporate action, require no action by or in respect of, or
filing with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
the articles of incorporation or by-laws of the Company or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the Company
or any of its Subsidiaries or result in the creation or imposition of any Lien
on any asset of the Company or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement has been duly executed and
delivered by the Company and constitutes a valid and binding agreement of the
Company and each of its Notes, when executed and delivered in accordance with
this Agreement, will constitute a valid and binding obligation of the Company,
in each case enforceable in accordance with its terms.
SECTION 4.04. Financial Information. (a) The consolidated balance sheet of
the Company and its Consolidated Subsidiaries as of December 31, 1996 and the
related consolidated statements of operations, cash flows and common
shareholders' equity for the fiscal year then ended, reported on by Ernst &
Young LLP and set forth in the Company's 1996 Form 10-K, a copy of which has
been delivered to each of the Banks, fairly present, in conformity with
generally accepted accounting principles, the consolidated financial position of
the Company and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such fiscal year.
50
(b) The unaudited consolidated balance sheet of the Company and its
Consolidated Subsidiaries as of June 30, 1997 and the related unaudited
consolidated statements of operations and cash flows for the six months then
ended, set forth in the Company's quarterly report for the fiscal quarter ended
June 30, 1997 as filed with the Securities and Exchange Commission on Form 10-Q,
a copy of which has been delivered to each of the Banks, fairly present, in
conformity with generally accepted accounting principles applied on a basis
consistent with the financial statements referred to in subsection (a) of this
Section, the consolidated financial position of the Company and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
cash flows for such six month period (subject to normal year-end adjustments).
(c) Since June 30, 1997 there has been no material adverse change in the
business, financial position or results of operations of the Company and its
Consolidated Subsidiaries, considered as a whole.
SECTION 4.05. Litigation. There is no action, suit or proceeding pending
against or, to the knowledge of the Company, threatened against or affecting the
Company or any of its Subsidiaries before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable possibility
of an adverse decision which would materially adversely affect the business,
consolidated financial position or consolidated results of operations of the
Company and its Consolidated Subsidiaries, considered as a whole, or which in
any manner draws into question the validity or enforceability of this Agreement
or the Notes.
SECTION 4.06. Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (iii)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.
SECTION 4.07. Environmental Matters. In the ordinary course of its
business, the Company conducts an ongoing review of the effect of Environmental
Laws on the business, operations and properties of the Company
51
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties presently
or previously owned, any capital or operating expenditures required to achieve
or maintain compliance with environmental protection standards imposed by law or
as a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat, any costs or liabilities in connection with off-site disposal
of wastes or Hazardous Substances, and any actual or potential liabilities to
third parties, including employees, and any related costs and expenses). On the
basis of this review, the Company has reasonably concluded that such associated
liabilities and costs, including the costs of compliance with Environmental
Laws, are unlikely to have an effect on the business, financial condition,
results of operations or prospects of the Company and its Consolidated
Subsidiaries, considered as a whole, that would be materially adverse in
relation to the Banks.
SECTION 4.08. Taxes. The Company and its Subsidiaries have filed all United
States Federal income tax returns and all other material tax returns which are
required to be filed by them and have paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Company or any Subsidiary
except in the case of any assessment, if such assessment is being contested by
the Company or its Subsidiaries by appropriate proceedings. The charges,
accruals and reserves on the books of the Company and its Subsidiaries in
respect of taxes or other governmental charges are, in the opinion of the
Company, adequate.
SECTION 4.09. Subsidiaries. Each of the Company's corporate Material
Subsidiaries is a corporation validly existing and in good standing under the
laws of its jurisdiction of incorporation, and has all corporate powers and all
material governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted.
SECTION 4.10. Regulatory Restrictions on Borrowing. The Company is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, a "holding company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or otherwise subject to any regulatory scheme
which restricts its ability to incur debt.
SECTION 4.11. Full Disclosure. Neither the description of the Company in
the Information Memorandum, as of the date of the Information Memorandum, nor
any statement or certification furnished by the Company to any Agent or Bank
pursuant to this Agreement, as of the date of such statement or certification,
contained any untrue statement of a material fact or omitted to state a material
52
fact necessary in order to make any statements contained therein, in the light
of the circumstances under which they were made, not misleading.
ARTICLE 5
COVENANTS
The Company and, where stated, each other Borrower agree that, so long as
any Bank has any Commitment hereunder or any amount payable hereunder or under
any Note remains unpaid:
SECTION 5.01. Company Information. The Company will deliver to the General
Administrative Agent for delivery to each of the Banks:
(a) as soon as available and in any event within 100 days after the end of
each fiscal year of the Company, a consolidated balance sheet of the Company and
its Consolidated Subsidiaries as of the end of such fiscal year and the related
consolidated statements of operations, cash flows and common shareholders'
equity for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on in a manner acceptable to
the Securities and Exchange Commission by Ernst & Young LLP or other independent
public accountants of nationally recognized standing;
(b) as soon as available and in any event within 50 days after the end of
each of the first three quarters of each fiscal year of the Company, a
consolidated balance sheet of the Company and its Consolidated Subsidiaries as
of the end of such quarter and the related consolidated statements of operations
for such quarter and for the portion of the Company's fiscal year ended at the
end of such quarter and the related consolidated statement of cash flows for the
portion of the Company's fiscal year ended at the end of such quarter, setting
forth in the case of such statements of operations and cash flows, in
comparative form, the figures for the corresponding periods of the Company's
previous fiscal year, all certified (subject to normal year-end adjustments) as
to fairness of presentation, generally accepted accounting principles (except as
to the absence of footnotes) and consistency by the chief financial officer or
the chief accounting officer of the Company;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate of the chief financial
officer or the chief accounting officer of the Company (i) setting forth in
reasonable detail the calculations required to establish whether the Company was
in compliance with the requirements of Sections 5.08(b) and 5.10(g), (h) and (l)
53
and 5.11 to 5.14, inclusive, on the date of such financial statements, (ii) if
the One-Time Pricing Option (as defined in the Pricing Schedule) has not been
exercised, setting forth the calculations required to establish the Applicable
Pricing Ratio (as defined in the Pricing Schedule) and (iii) stating whether any
Default exists on the date of such certificate and, if any Default then exists,
setting forth the details thereof and the action which the Company is taking or
proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above, a statement of the firm of independent public
accountants which reported on such statements (i) as to whether anything has
come to their attention to cause them to believe that any Default existed on the
date of such statements (it being understood that such accountants shall not
thereby be required to perform any procedures not otherwise required under
generally accepted auditing standards) and (ii) confirming the calculations set
forth in the officer's certificate delivered simultaneously therewith pursuant
to clause (c) above;
(e) within five days after the chief financial officer, the treasurer or
chief accounting officer of the Company obtains knowledge of any Default, if
such Default is then continuing, a certificate of the chief financial officer,
the treasurer or the chief accounting officer of the Company setting forth the
details thereof and the action which the Company is taking or proposes to take
with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the Company
generally, copies of all financial statements, reports and proxy statements so
mailed;
(g) promptly upon the filing thereof, copies of all registration statements
(other than the exhibits thereto and any registration statements on Form S-8 or
its equivalent) and reports (other than the exhibits thereto) on Forms 10-K,
10-Q and 8-K (or their equivalents) which the Company shall have filed with the
Securities and Exchange Commission;
(h) if and when any member of the ERISA Group (i) gives or is required to
give notice to the PBGC of any "reportable event" (as defined in Section 4043 of
ERISA) with respect to any Plan which might constitute grounds for a termination
of such Plan under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such reportable event, a
copy of the notice of such reportable event given or required to be given to the
PBGC; (ii) receives notice of complete or partial withdrawal liability under
Title IV of ERISA or notice that any Multiemployer Plan is in reorganization, is
insolvent or has been terminated, a copy of such notice;
54
(iii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer or the chief accounting officer of
the Company setting forth details as to such occurrence and action, if any,
which the Company or applicable member of the ERISA Group is required or
proposes to take; and
(i) from time to time such additional information regarding the financial
position or business of the Company and its Subsidiaries as the Administrative
Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Other Borrower Information. Each Borrower other than the
Company will deliver to the General Administrative Agent for delivery to each of
the Banks:
(a) as soon as available and in any event within 140 days after the end of
each fiscal year of such Borrower, a consolidated balance sheet of such Borrower
and its Consolidated Subsidiaries as of the end of such fiscal year and the
related consolidated statements of operations, cash flows and common
shareholders' equity for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all certified as to
fairness of presentation and consistency by the chief financial officer or the
chief accounting officer of such Borrower; and
(b) from time to time such additional information regarding the financial
position or business of such Borrower as the Administrative Agent, at the
request of any Bank, may reasonably request.
SECTION 5.03. Payment of Obligations. Each Borrower will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, at or before
maturity, all their respective material obligations and liabilities (including,
without limitation, material tax liabilities and claims of materialmen,
warehousemen and the like which if unpaid might by law give rise to a Lien),
except where the same may be contested in good faith by appropriate proceedings,
55
and will maintain, and will cause each of its Subsidiaries to maintain, in
accordance with generally accepted accounting principles, appropriate reserves
for the accrual of any of the same.
SECTION 5.04. Maintenance of Property; Insurance. (a) Each Borrower will
keep, and will cause each of its Subsidiaries to keep, all material property
useful and necessary in its business in good working order and condition,
ordinary wear and tear excepted.
(b) Each Borrower will, and will cause each of its Subsidiaries to,
maintain (either in the name of the Company or in such Borrower's or
Subsidiary's own name) with financially sound and responsible insurance
companies, insurance on all its respective properties in at least such amounts,
against at least such risks and with such risk retention as are usually
maintained, insured against or retained, as the case may be, in the same general
area by companies of established repute engaged in the same or a similar
business; and will furnish to the Banks, upon request from the Administrative
Agent, information presented in reasonable detail as to the insurance so
carried.
SECTION 5.05. Conduct of Business and Maintenance of Existence. Each
Borrower and its Subsidiaries taken as a whole will continue to engage in
business of the same general type as now conducted by such Borrower and its
Subsidiaries, and each Borrower will preserve, renew and keep in full force and
effect, and will cause each of its Subsidiaries to preserve, renew and keep in
full force and effect, its respective corporate existence and its respective
rights, privileges and franchises necessary or desirable in the normal conduct
of business; provided that nothing in this Section shall prohibit (i) the
consolidation or merger of a Subsidiary (other than an Eligible Subsidiary with
obligations with respect to Borrowings or Bankers' Acceptances outstanding
hereunder) with or into another Person, (ii) the consolidation or merger of an
Eligible Subsidiary with or into another Eligible Subsidiary or (iii) the
termination of the corporate existence of any Subsidiary (other than an Eligible
Subsidiary with obligations with respect to Borrowings or Bankers' Acceptances
outstanding hereunder) if, in the case of clauses (i), (ii) and (iii), the
Company in good faith determines that such consolidation, merger or termination
is in the best interest of the Company and is not materially disadvantageous to
the Banks.
SECTION 5.06. Compliance with Laws. Each Borrower will comply, and cause
each of its Subsidiaries to comply, in all material respects with all applicable
laws, ordinances, rules, regulations, and requirements of governmental
authorities (including, without limitation, Environmental Laws and ERISA and the
rules and regulations thereunder) except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings.
56
SECTION 5.07. Inspection of Property, Books and Records. Each Borrower will
keep, and will cause each of its Subsidiaries to keep, proper books of record
and account in which full, true and correct entries shall be made of all
dealings and transactions in relation to its business and activities; and will
permit, and will cause each of its Subsidiaries to permit, representatives of
any Bank at such Bank's expense to visit and inspect any of its respective
properties, to examine and make abstracts from any of its respective books and
records and to discuss its respective affairs, finances and accounts with its
respective officers, employees and independent public accountants, all at such
reasonable times as may be desired.
SECTION 5.08. Mergers and Sales of Assets. (a) The Company will not
consolidate or merge with or into any other Person; provided that the Company
may merge with another Person if (x) the Company is the corporation surviving
such merger and (y) after giving effect to such merger, no Default shall have
occurred and be continuing.
(b) The Company will not sell, lease or otherwise transfer, directly, or
indirectly, assets (exclusive of assets transferred in the ordinary course of
business and any Permitted Receivables Disposition) if after giving effect to
such transfer the aggregate book value of assets so transferred subsequent to
the date of this Agreement would exceed 25% of Consolidated Assets as of the day
preceding the date of such transfer.
SECTION 5.09. Use of Proceeds. The proceeds of the Loans made under this
Agreement and of the Bankers' Acceptances accepted and purchased under this
Agreement will be used by the Borrowers for general corporate purposes. None of
such proceeds will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any "margin stock"
within the meaning of Regulation U.
SECTION 5.10. Negative Pledge. Neither any Borrower nor any Subsidiary of
any Borrower will create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt outstanding
on the date of this Agreement in an aggregate principal or face amount not
exceeding $15,000,000;
(b) any Lien existing on any asset of any Person at the time such Person
becomes a Subsidiary of a Borrower and not created in contemplation of such
event;
57
(c) any Lien on any asset securing Debt incurred or assumed for the purpose
of financing all or any part of the cost of acquiring or constructing such
asset, provided that such Lien attaches to such asset concurrently with or
within 90 days after the acquisition or completion of construction thereof;
(d) any Lien on any asset of any Person existing at the time such Person is
merged or consolidated with or into a Borrower or a Subsidiary of a Borrower and
not created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition thereof by a
Borrower or a Subsidiary of a Borrower and not created in contemplation of such
acquisition;
(f) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the foregoing
clauses of this Section, provided that the proceeds or such Debt are used solely
for the foregoing purpose and to pay financing costs and such Debt is not
secured by any additional assets;
(g) Liens arising in the ordinary course of its business which (i) do not
secure Debt or Derivatives Obligations, (ii) do not secure any obligation in an
amount exceeding $25,000,000 and (iii) do not in the aggregate materially
detract from the value of its assets or materially impair the use thereof in the
operation of its business;
(h) Liens on cash and cash equivalents securing Derivatives Obligations,
provided that the aggregate amount of cash and cash equivalents subject to such
Liens may at no time exceed $25,000,000;
(i) Liens for current taxes, assessments and other governmental charges not
yet due and payable or being contested in good faith and as to which adequate
reserves in accordance with generally accepted accounting principles have been
established;
(j) mechanics, materialmen's, carrier's, warehousemen's or similar liens
for sums not yet due and owing or being contested in good faith and as to which
adequate reserves in accordance with generally accepted accounting principles
have been established;
(k) Liens created in connection with Permitted Securitization Transactions;
provided that, except for the assets transferred pursuant to Permitted
Receivables Dispositions made in connection with such Permitted Securitization
58
Transactions, no such Lien may extend to any assets of the Company or any
Subsidiary of the Company that is not a Bankruptcy Remote Subsidiary; and
(l) Liens not otherwise permitted by the foregoing clauses of this Section
securing Debt in an aggregate principal or face amount at any date not to exceed
an amount equal to the excess of 10% of Consolidated Net Worth over the
aggregate Value of Sale-Leaseback Transactions which would not have been
permitted under Section 5.14 but for this clause (l).
SECTION 5.11. Debt to Total Capital. The ratio of Consolidated Debt to
Total Capital shall not exceed during any period set forth below the applicable
ratio set forth below for such period. For purposes of this Section 5.11
Consolidated Debt shall exclude accreted discount on Bankers' Acceptances.
Period Ratio
------ -----
Closing Date to December 30, 1997 70%
December 31, 1997 - December 30, 1998 67%
December 31, 1998 - December 30, 1999 63%
December 31, 1999 - December 30, 2000 59%
December 31, 2000 and thereafter 55%
SECTION 5.12. Debt of Subsidiaries. Total Debt of all Subsidiaries
(excluding Debt (i) of a Subsidiary owing to the Company, (ii) of a Subsidiary
owing to a wholly owned Subsidiary, (iii) of an Eligible Subsidiary under this
Agreement or (iv) incurred in connection with a refinancing of the Canadian
Facility, but only to the extent that the amount of such Debt incurred in
reliance on this clause (iv) does not exceed the amount by which the Commitments
shall have been reduced pursuant to Section 2.09(b) in connection with such
refinancing of the Canadian Facility) will at no time exceed $125,000,000. For
purposes of this Section any preferred stock of a Consolidated Subsidiary held
by a Person other than the Company or a Wholly-Owned Consolidated Subsidiary
shall be included, at the higher of its voluntary or involuntary liquidation
value, in the "Debt" of such Consolidated Subsidiary.
SECTION 5.13. Minimum Consolidated Net Worth. Consolidated Net Worth will
at no time be less than an amount equal to the sum of (i) $295,000,000 plus (ii)
an amount equal to 25% of Consolidated Net Income for each fiscal quarter of the
Company ending after June 30, 1997 and on or prior to the date of determination,
in each case, for which Consolidated Net Income is positive (but with no
deduction on account of negative Consolidated Net Income for any fiscal quarter
of the Company) plus (iii) 50% of the aggregate net proceeds, including the fair
market value of property other than cash (as determined in good faith by
59
the Board of Directors of the Company), received by the Company from the
issuance and sale after the date hereof of any capital stock of the Company
(other than the proceeds of any issuance and sale of any capital stock (x) to a
Subsidiary of the Company or (y) which is required to be redeemed, or is
redeemable at the option of the holder, at any time) or in connection with the
conversion or exchange of any Debt of the Company into capital stock of the
Company after June 30, 1997.
SECTION 5.14. Sale-leaseback Transactions. Neither any Borrower nor any of
their respective Subsidiaries will engage in any Sale-Leaseback Transaction
unless such Borrower or such Subsidiary would be entitled, pursuant to the
provisions of Section 5.10, to incur Debt with a principal amount equal to or
exceeding the Value of such Sale-Leaseback Transaction secured by a Lien on the
property to be leased (after giving similar effect to all other Sale-Leaseback
Transactions in effect at such time). For purposes of this Section and Section
5.10(l), "Value" means, with respect to a Sale-Leaseback Transaction, at any
time, the amount equal to the greater of (i) the net proceeds of the sale or
transfer of the property leased pursuant to such Sale-Leaseback Transaction and
(ii) the fair value in the opinion of the Board of Directors of the Company of
such property at the time of entering into such Sale-Leaseback Transaction, in
either case divided first by the number of full years of the term of the lease
and then multiplied by the number of full years of such term remaining at the
time of determination, without regard to any renewal or extension options
contained in the lease.
SECTION 5.15. Transactions with Affiliates. No Borrower will, nor will it
permit any of its Subsidiaries to, directly or indirectly, pay any funds to or
for the account of, make any investment (whether by acquisition of stock or
indebtedness, by loan, advance, transfer of property, guarantee or other
agreement to pay, purchase or service, directly or indirectly, any Debt, or
otherwise) in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, to, or participate in, or effect, any transaction with,
any Affiliate except on an arms-length basis on terms at least as favorable to
such Borrower or such Subsidiary as could have been obtained from a third party
who was not an Affiliate; provided that the foregoing provisions of this Section
shall not prohibit any such Person from declaring or paying any lawful dividend
or other payment ratably in respect of all of its capital stock, from paying
reasonable compensation to its directors and officers or from entering into
other transactions that the Company determines are in its best interests and
having a cost to such Person not in excess of $5,000,000.
60
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
(a) (i) any principal of any Loan or any Bankers' Acceptance shall fail to
be paid when due or (ii) any interest, any fees or any other amount payable
hereunder shall fail to be paid within five days after the due date thereof;
(b) any Borrower shall fail to observe or perform any covenant contained in
Article 5, other than those contained in Sections 5.01 through 5.07 and 5.10;
(c) any Borrower shall fail to observe or perform any covenant contained in
Section 5.10 for 30 days after such Borrower shall have obtained knowledge
thereof;
(d) any Borrower shall fail to observe or perform any covenant or agreement
contained in this Agreement (other than those covered by clause (a), (b) or (c)
above) for 30 days after notice thereof has been given to the Company by the
General Administrative Agent at the request of any Bank;
(e) any representation, warranty, certification or statement made by any
Borrower in this Agreement or in any certificate, financial statement or other
document delivered pursuant to this Agreement shall prove to have been incorrect
in any material respect when made (or deemed made);
(f) any Borrower or any Subsidiary shall fail to make any payment in
respect of any Material Financial Obligations when due or within any applicable
grace period;
(g) any event or condition shall occur which results in the acceleration of
the maturity of any Material Debt or enables (with the giving of notice of
acceleration, if required) the holder of such Debt or any Person acting on such
holder's behalf to accelerate the maturity thereof;
(h) any Borrower or any Material Subsidiary shall commence a voluntary case
or other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding
61
commenced against it, or shall make a general assignment for the benefit of
creditors, or shall fail generally to pay its debts as they become due, or shall
take any corporate action to authorize any of the foregoing;
(i) an involuntary case or other proceeding shall be commenced against any
Borrower or any Material Subsidiary seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against any Borrower or any Material Subsidiary under
the federal bankruptcy laws as now or hereafter in effect;
(j) any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $5,000,000 which it shall have become liable to
pay under Title IV of ERISA; or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
causes one or more members of the ERISA Group to incur a current payment
obligation in excess of $5,000,000 in the aggregate that is not paid when due;
(k) judgments or orders for the payment of money in excess of $5,000,000 in
the aggregate shall be rendered against any Borrower or any Material Subsidiary
and such judgments or orders shall continue unsatisfied and unstayed for a
period of 30 days;
(l) any person or group of persons (within the meaning of Section 13 or 14
of the Securities Exchange Act of 1934, as amended) shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) of 35% or more of the
outstanding shares of common stock of the Company; or, during any period of 12
consecutive calendar months, individuals who were directors of the Company on
the first day of such period shall cease to constitute a majority of the board
of directors of the Company; or
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(m) any of the obligations of the Company under Article 10 of this
Agreement shall for any reason not be enforceable against the Company in
accordance with their terms, or the Company shall so assert in writing;
then, and in every such event, the General Administrative Agent shall (i) if
requested by the Required Banks, by notice to the Borrowers terminate the
Commitments and they shall thereupon terminate, and (ii) if requested by the
Required Banks, by notice to the Borrowers declare the Loans (together with
accrued interest thereon) to be, and the Loans shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by each Borrower; provided that in
the case of any of the Events of Default specified in clause 6.01(h) or 6.01(i)
with respect to any Borrower, without any notice to any Borrower or any other
act by the General Administrative Agent or the Banks, the Commitments shall
thereupon terminate and the Loans (together with accrued interest thereon) shall
become immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by each Borrower.
SECTION 6.02. Notice of Default. The General Administrative Agent shall
give notice to the Company under Section 6.01(d) promptly upon being requested
to do so by any Bank and shall thereupon notify all the Banks thereof.
SECTION 6.03. Action by Administrative Agents. If an Event of Default shall
have occurred and be continuing and the Required Banks instruct the Canadian
Administrative Agent to request cash collateral pursuant to this Section, each
Borrower issuing a Bankers' Acceptance will, promptly after it receives such
request from the Canadian Administrative Agent, pay to the Canadian
Administrative Agent an amount in Canadian Dollars in immediately available
funds equal to the then outstanding Bankers' Acceptances to be held by the
Canadian Administrative Agent, under arrangements satisfactory to it, to secure
the payment of the face amount of such outstanding Bankers' Acceptances upon
maturity; provided that, if any Event of Default specified in clause 6.01(h) or
6.01(i) occurs with respect to any Borrower, such Borrower shall pay such amount
to the Canadian Administrative Agent forthwith without any notice, demand or
other act by the Canadian Administrative Agent or the Banks.
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ARTICLE 7
THE AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank irrevocably appoints
and authorizes each Administrative Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement, and the Notes as are
delegated to such Administrative Agent by the terms hereof or thereof, together
with all such powers as are reasonably incidental thereto.
SECTION 7.02. Administrative Agents and Affiliates. The Chase Manhattan
Bank and The Chase Manhattan Bank of Canada shall have the same rights and
powers under this Agreement as any other Bank and may exercise or refrain from
exercising the same as though it were not the Administrative Agent, and The
Chase Manhattan Bank and its affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with any Borrower or any Subsidiary
or Affiliate of any Borrower as if it were not the Administrative Agent.
SECTION 7.03. Action by Administrative Agents. The obligations of the
Administrative Agents hereunder are only those expressly set forth herein.
Without limiting the generality of the foregoing, the Administrative Agents
shall not be required to take any action with respect to any Default, except as
expressly provided in Article 6.
SECTION 7.04. Consultation with Experts. The Administrative Agents may
consult with legal counsel (who may be counsel for any Borrower), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Administrative Agent. Neither Administrative
Agent nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be liable for any action taken or not taken by it in
connection herewith (i) with the consent or at the request of the Required Banks
(or, when expressly required hereby, all the Banks) or (ii) in the absence of
its own gross negligence or willful misconduct. Neither Administrative Agent nor
any of its affiliates nor any of their respective directors, officers, agents or
employees shall be responsible for or have any duty to ascertain, inquire into
or verify (i) any statement, warranty or representation made in connection with
this Agreement or any borrowing hereunder; (ii) the performance or observance of
any of the covenants or agreements of any Borrower; (iii) the satisfaction of
any condition specified in Article 3, except receipt of items required to be
delivered to such Administrative Agent; or (iv) the validity, effectiveness or
genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection
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herewith. Neither Administrative Agent shall incur any liability by acting in
reliance upon any notice, consent, certificate, statement, or other writing
(which may be a bank wire, telex, facsimile transmission or similar writing)
believed by it to be genuine or to be signed by the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in accordance with
its Commitment of the applicable Class, indemnify each Administrative Agent, its
affiliates and their respective directors, officers, agents and employees (to
the extent not reimbursed by the Borrowers) against any cost, expense (including
reasonable counsel fees and disbursements), claim, demand, action, loss or
liability (except such as result from such indemnitees' gross negligence or
willful misconduct) that such indemnitees may suffer or incur in connection with
this Agreement or any action taken or omitted by such indemnitees hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon any Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon any Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.08. Successor Administrative Agent. Either Administrative Agent
may resign at any time by giving notice thereof to the Banks and the Company.
Upon any such resignation, the Required Banks shall have the right to appoint a
successor Administrative Agent, subject to the approval of the Company. If no
successor Administrative Agent shall have been so appointed by the Required
Banks, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent gives notice of resignation, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be, in the case of the General Administrative
Agent, a commercial bank organized or licensed under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $100,000,000 and, in the case of the Canadian Administrative
Agent, a Schedule I Bank or a Schedule II Bank which has, or is a subsidiary of
a bank or a bank holding company which has, a combined capital and surplus of at
least $100,000,000. Upon the acceptance of its appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent's resignation hereunder as
65
Administrative Agent, the provisions of this Article shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Administrative
Agent.
SECTION 7.09. Agents' Fees. The Company shall pay, or shall cause
BetzDearborn Canada to pay, to each of the Administrative Agents and the
Syndication Agent for its own account fees in the amounts and at the times
previously agreed upon between the Company and such Agent.
SECTION 7.10. Other Agents. Nothing in this Agreement shall impose upon the
Documentation Agent or the Syndication Agent, in such capacity, any duties or
obligations whatsoever.
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair. If
on or prior to the first day of any Interest Period for any CD Loan, Euro-Dollar
Loan or Money Market LIBOR Loan:
(a) the Administrative Agent is advised by the Reference Banks that
deposits in the relevant currency (in the applicable amounts) are not being
offered to the Reference Banks in the relevant market for such Interest Period,
or
(b) in the case of CD Loans or Euro-Dollar Loans, Banks having 50% or more
of the aggregate principal amount of the affected Loans advise the
Administrative Agent that the Adjusted CD Rate or London Interbank Offered Rate,
as the case may be, as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Banks of funding their Loans for
such Interest Period, the Administrative Agent shall forthwith give notice
thereof to the Borrower and the Banks, whereupon until the Administrative Agent
notifies the Borrower that the circumstances giving rise to such suspension no
longer exist, (i) the obligations of the Banks to make CD Loans or Euro-Dollar
Loans, as the case may be, or to continue or convert outstanding Loans as or
into CD Loans or Euro- Dollar Loans, as the case may be, shall be suspended and
(ii) each outstanding CD Loan or Euro-Dollar Loan, as the case may be, shall be
converted into a Base Rate Loan (in the case of CD Loans or Euro-Dollar Loans)
on the last day of the then current Interest Period applicable thereto. Unless
the Borrower notifies the Administrative Agent at least two Business Days before
the date of any Fixed Rate Borrowing for which a Notice of Borrowing has
previously been given that it
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elects not to borrow on such date, (i) if such Fixed Rate Borrowing is a
Committed Borrowing, such Borrowing shall instead be made as a Base Rate
Borrowing and (ii) if such Fixed Rate Borrowing is a Money Market LIBOR
Borrowing, such Borrowing shall be cancelled.
SECTION 8.02. Illegality. If, on or after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Applicable Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall make it unlawful or impossible for any Bank (or its
Applicable Lending Office) to make, maintain or fund its Euro-Dollar Loans to
any Borrower and such Bank shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Banks and
the Borrower, whereupon until such Bank notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Bank to make Euro-Dollar Loans to such
Borrower, or to convert outstanding Loans into Euro-Dollar Loans, shall be
suspended. Before giving any notice to the Administrative Agent pursuant to this
Section, such Bank shall designate a different Applicable Lending Office if such
designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. If such notice
is given, each Euro-Dollar Loan of such Bank then outstanding shall be
converted to a Base Rate Loan of the same Class either (a) on the last day of
the then current Interest Period applicable to such Euro-Dollar Loan if such
Bank may lawfully continue to maintain and fund such Loan to such day or (b)
immediately if such Bank shall determine that it may not lawfully continue to
maintain and fund such Loan to such day.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on or after (x) the
date hereof, in the case of any Committed Loan or Bankers' Acceptance or any
obligation to make Committed Loans or accept or purchase Bankers' Acceptances or
(y) the date of the related Money Market Quote, in the case of any Money Market
Loan, the adoption of any applicable law, rule or regulation, or any change in
any applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Applicable Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall impose, modify or deem applicable any reserve
(including, without limitation, any such requirement imposed by the Board of
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Governors of the Federal Reserve System, but excluding (i) with respect to any
CD Loan any such requirement included in an applicable Domestic Reserve
Percentage and (ii) with respect to any Euro-Dollar Loan any such requirement
with respect to which such Bank is entitled to compensation during the relevant
Interest Period under Section 2.17), special deposit, insurance assessment
(excluding, with respect to any CD Loan, any such requirement reflected in an
applicable Assessment Rate) or similar requirement against assets of, deposits
with or for the account of, or credit (including bankers' acceptances) extended
by, any Bank (or its Applicable Lending Office) or shall impose on any Bank (or
its Applicable Lending Office) or on the United States market for certificates
of deposit, the London interbank market or the Canadian bankers' acceptance
market any other condition affecting its Fixed Rate Loans, its Notes or its
obligation to make Fixed Rate Loans or its obligations hereunder in respect of
Bankers' Acceptances and the result of any of the foregoing is to increase the
cost to such Bank (or its Applicable Lending Office) of making or maintaining
any Fixed Rate Loan or accepting any Bankers' Acceptance , or to reduce the
amount of any sum received or receivable by such Bank (or its Applicable Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Administrative Agent), each Borrower shall pay to
such Bank such additional amount or amounts as will compensate such Bank for the
portion of such increased cost or reduction allocable to such Borrower.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any such law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on capital
of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below that which such Bank (or its Parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Bank to be material, then from time to time, within 15 days after demand
by such Bank (with a copy to the Administrative Agent), each Borrower shall pay
to such Bank the portion allocable to such Borrower of such additional amount or
amounts as will compensate such Bank (or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrowers and the Administrative
Agent of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Bank to compensation pursuant to this Section
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and will designate a different Applicable Lending Office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. A
certificate of any Bank claiming compensation under this Section and setting
forth the additional amount or amounts (and the calculation thereof) to be paid
to it hereunder shall be conclusive in the absence of manifest error. In
determining such amount, such Bank may use any reasonable averaging and
attribution methods.
SECTION 8.04. Taxes. (a) For the purposes of this Section 8.04, the
following terms have the following meanings:
"Taxes" means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings of any nature with respect to any payment by
any Borrower to or for the account of the Administrative Agent or any Bank
pursuant to this Agreement or under any Note or Bankers' Acceptance, and all
liabilities with respect thereto, excluding (i) in the case of each Bank and the
Administrative Agent, taxes imposed on its income, and franchise or similar
taxes imposed on it, by a jurisdiction under the laws of which such Bank or the
Administrative Agent (as the case may be) is organized or in which its principal
executive office is located or by any other jurisdiction imposing such taxes by
reason of any connection between such jurisdiction and such Bank or the
Administrative Agent (as the case may be) other than a connection arising solely
from this Agreement or, in the case of each Bank, in which its Applicable
Lending Office is located (all such excluded taxes of the Administrative Agent
or any Bank being herein referred to as its "Domestic Taxes") and (ii) in the
case of each Bank, (x) with respect to payments under the US Subfacility by any
Borrower incorporated under the laws of the United States or any state thereof,
any United States withholding tax imposed on such payments but only to the
extent that payments to such Bank by such Borrower hereunder are subject to
United States withholding tax at the time such Bank first becomes a party to
this Agreement and (y) with respect to payments under the Canadian Subfacility
by any Borrower organized under the laws of Canada or any province thereof, any
Canadian withholding tax imposed on such payments but only to the extent that
payments to such Bank by such Borrower hereunder are subject to Canadian
withholding tax at the time such Bank first becomes a party to this Agreement.
"Other Taxes" means any present or future stamp or documentary taxes and
any other excise or property taxes, or similar charges or levies, which arise
from any payment made pursuant to this Agreement or under any Note or Bankers'
Acceptance or from the execution or delivery, registration or enforcement of, or
otherwise with respect to, this Agreement or any Note or Bankers' Acceptance.
69
(b) Any and all payments by any Borrower to or for the account of any Bank
or the Administrative Agent hereunder or under any Note or Bankers' Acceptance
shall be made without deduction or withholding for any Taxes or Other Taxes;
provided that, if any Borrower shall be required by law to deduct any Taxes or
Other Taxes from any such payments, (i) the sum payable shall be increased as
necessary so that after making all required deductions and withholdings
(including deductions and withholdings applicable to additional sums payable
under this Section) such Bank or the Administrative Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions or withholdings been made, (ii) such Borrower shall make such
deductions or withholdings, (iii) such Borrower shall pay the full amount
deducted or withheld to the relevant taxation authority or other authority in
accordance with applicable law and (iv) such Borrower shall promptly furnish to
the Administrative Agent, at its address referred to in Section 11.01, the
original or a certified copy of a receipt evidencing payment thereof.
(c) Each Borrower agrees to indemnify each Bank and the Administrative
Agent for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section), whether or not correctly imposed, paid by
such Bank or the Administrative Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto to the extent allocable to such Borrower. In addition, each Borrower
organized under the laws of a jurisdiction outside the United States of America
(with respect to the US Subfacility) or Canada (with respect to the Canadian
Subfacility) agrees to indemnify the Administrative Agent and each Bank for all
Domestic Taxes incurred by it and any liability (including any penalties,
interest and expenses, to the extent not attributable to its gross negligence or
willful misconduct), arising therefrom or with respect thereto, in each case to
the extent that such Domestic Taxes or liabilities result from any payment or
indemnification pursuant to this Section in connection with the US Subfacility
or the Canadian Subfacility, as the case may be. Each Bank will promptly notify
the Borrowers and the Administrative Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Bank to
compensation pursuant to this Section. A certificate of any Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it and the calculation thereof hereunder shall be
conclusive in the absence of manifest error. Such amount(s) shall be paid within
15 days after such Bank or the Administrative Agent (as the case may be) makes
demand therefor.
(d) Each Bank having a US Commitment organized under the laws of a
jurisdiction outside the United States, on or prior to the date of its execution
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and delivery of this Agreement in the case of each Bank listed on the signature
pages hereof and on or prior to the date on which it becomes a Bank in the case
of each other Bank, and from time to time thereafter if requested in writing by
the Borrowers under the US Subfacility (but only so long as such Bank remains
lawfully able to do so), shall provide the Borrowers and the Administrative
Agent with Internal Revenue Service form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Bank is entitled to benefits under an income tax treaty to which the United
States is a party which exempts the Bank from United States withholding tax or
reduces the rate of withholding tax on payments of interest for the account of
such Bank or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States.
(e) For any period with respect to which a Bank has failed to provide the
Borrowers or the Administrative Agent with the appropriate form pursuant to
Section 8.04(d) (unless such failure is due to a change in treaty, law or
regulation occurring subsequent to the date on which such form originally was
required to be provided), such Bank shall not be entitled to indemnification
under Section 8.04(b) or (c) with respect to Taxes imposed by the United States;
provided that if a Bank, which is otherwise exempt from or subject to a reduced
rate of withholding tax, becomes subject to Taxes because of its failure to
deliver a form required hereunder, the Borrowers shall take such steps as such
Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If any Borrower is required to pay additional amounts to or for the
account of any Bank pursuant to this Section, then such Bank will change the
jurisdiction of its Applicable Lending Office if, in the judgment of such Bank,
such change (i) will eliminate or reduce any such additional payment which may
thereafter accrue and (ii) is not otherwise disadvantageous to such Bank.
(g) Each Bank and the Administrative Agent shall, at the request of the
Borrower, use reasonable efforts (consistent with applicable legal and
regulatory restrictions) to file any certificate or document requested by the
Borrower if the making of such a filing would avoid the need for or reduce the
amount of any such additional amounts payable to or for the account of such Bank
or the Agent (as the case may be) pursuant to this Section 8.04 which may
thereafter accrue and would not, in the sole judgment of such Bank or the
Administrative Agent, require such Bank or the Administrative Agent to disclose
any confidential or proprietary information or be otherwise disadvantageous to
such Bank or the Administrative Agent.
(h) If a Bank or the Administrative Agent (as the case may be) shall become
aware that it is entitled to claim a refund (a "Refund") from a taxing
71
authority of such Taxes or Other Taxes for which it has been indemnified by
any Borrower, or with respect to which any Borrower has paid additional amounts,
pursuant to this Section 8.04, it shall promptly notify such Borrower of the
availability of such Refund and shall, within 30 days after receipt of a written
request by such Borrower, make a claim to such taxing authority for such Refund
at such Borrower's expense if, in the judgment of such Bank or the
Administrative Agent (as the case may be), the making of such claim will not be
otherwise disadvantageous to it; provided that nothing in this subsection (c)
shall be construed to require any Bank or the Administrative Agent to institute
any administrative proceeding (other than the filing of a claim for any such
Refund) or judicial proceeding to obtain any such Refund. If a Bank or the
Administrative Agent (as the case may be) receives a Refund from a taxing
authority (as a result of any error in the amount of Taxes or Other Taxes paid
to such taxing authority) of any such Taxes or Other Taxes for which it has been
indemnified by any Borrower, or with respect to which any Borrower has paid
additional amounts, pursuant to this Section 8.04, it shall promptly pay to such
Borrower the amount so received (but only to the extent of indemnity payments
made, or additional amounts paid, by such Borrower under this Section 8.04 with
respect to the Taxes or Other Taxes giving rise to such Refund), net of all
reasonable out-of-pocket expenses (including the net amount of taxes, if any,
imposed on such Bank or the Administrative Agent with respect to such Refund) of
such Bank or Administrative Agent, and without interest (other than interest
paid by the relevant taxing authority with respect to such Refund); provided,
however, that such Borrower upon the request of such Bank or the Administrative
Agent, agrees to repay the amount paid over to such Borrower (plus penalties,
interest or other charges) to such Bank or the Administrative Agent in the event
such Bank or the Administrative Agent is required to repay such Refund to such
taxing authority. Nothing contained in this Section 8.04 shall require any Bank
or the Administrative Agent to make available any of its tax returns (or any
other information that it deems to be confidential or proprietary).
SECTION 8.05. Base Rate Loans Substituted for Affected Fixed Rate Loans. If
(i) the obligation of any Bank to make, or convert outstanding Loans to,
Euro-Dollar Loans to any Borrower has been suspended pursuant to Section 8.02 or
(ii) any Bank has demanded compensation under Section 8.03 or 8.04 with respect
to its CD Loans or Euro-Dollar Loans and the Borrower shall, by at least five
Euro-Dollar Business Days' prior notice to such Bank through the Administrative
Agent, have elected that the provisions of this Section shall apply to such
Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer exist:
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(a) all Loans to such Borrower which would otherwise be made by such Bank
as (or continued as or converted into) CD Loans or Euro-Dollar Loans, as the
case may be, shall instead be Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Fixed Rate Loans of the
other Banks); and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case may be, to
such Borrower has been repaid (or converted to a Base Rate Loan), all payments
of principal which would otherwise be applied to repay such Fixed Rate Loans
shall be applied to repay its Base Rate Loans instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Base Rate Loan shall
be converted into a CD Loan or Euro-Dollar Loan, as the case may be, on the
first day of the next succeeding Interest Period applicable to the related CD
Loans or Euro-Dollar Loans of the other Banks.
SECTION 8.06. Substitution of Bank. If (i) the obligation of any Bank to
make Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii) any
Bank has demanded compensation under Section 8.03 or 8.04, the Company shall
have the right, with the assistance of the Administrative Agent, to seek a
mutually satisfactory substitute bank or banks (which may be one or more of the
Banks) to purchase the Notes and assume the Commitment(s) of such Bank and its
Related Bank (if any), all in accordance with Section 11.06(c).
SECTION 8.07. Allocations. The respective portions allocable to particular
Borrowers of any amount payable pursuant to Section 8.03 or 8.04 shall be as
determined by the Company and notified by it to the Bank demanding such payment.
The Company shall itself be unconditionally obligated for payment of any such
amount if and to the extent (i) it fails to allocate to particular Borrowers the
full amount payable within 15 days of demand for payment thereof or (ii) any
particular Borrower disputes the amount so allocated to it.
ARTICLE 9
REPRESENTATIONS AND WARRANTIES OF ELIGIBLE SUBSIDIARIES
On the Closing Date, BetzDearborn Canada represents and warrants that, and
by the execution and delivery by each other Eligible Subsidiary of its Election
to Participate, such Eligible Subsidiary shall be deemed to have represented and
warranted as of the date thereof that:
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SECTION 9.01. Corporate Existence and Power. It is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation and is an Eighty Percent-Owned Consolidated
Subsidiary of the Company.
SECTION 9.02. Corporate and Governmental Authorization; Contravention. The
execution and delivery by it of this Agreement or its Election to Participate
and its Notes, and the performance by it of this Agreement and its Notes, are
within its corporate powers, have been duly authorized by all necessary
corporate action, require no action by or in respect of, or filing with, any
governmental body, agency or official and do not contravene, or constitute a
default under, any provision of applicable law or regulation or of its
certificate or incorporation or by-laws or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Company or such
Eligible Subsidiary or result in the creation or imposition of any Lien on any
asset of the Company or any of its Subsidiaries.
SECTION 9.03. Binding Effect. This Agreement or its Election to Participate
has been duly executed by such Eligible Subsidiary and this Agreement
constitutes a valid and binding agreement of such Eligible Subsidiary and each
of its Notes, when executed and delivered in accordance with this Agreement,
will constitute a valid and binding obligation of such Eligible Subsidiary, in
each case enforceable in accordance with its terms.
SECTION 9.04. Taxes. Except as disclosed in the opinion of counsel
delivered pursuant to Section 3.01(c) of this Agreement or in its Election to
Participate, there are no Taxes or Other Taxes of any country, or any taxing
authority thereof or therein, which are imposed on any payment to be made by
such Eligible Subsidiary pursuant hereto or on its Notes, or imposed on or by
virtue of the execution, delivery or enforcement of this Agreement, its Election
to Participate or of its Notes.
ARTICLE 10
GUARANTY
SECTION 10.01. The Guaranty. The Company hereby unconditionally guarantees
the full and punctual payment (whether at stated maturity, upon acceleration or
otherwise) of the principal of and interest on each Loan made to or Bankers'
Acceptance issued by any Eligible Subsidiary pursuant to this Agreement, and the
full and punctual payment of all other amounts payable by any Eligible
74
Subsidiary under this Agreement. Upon failure by any Eligible Subsidiary to pay
punctually any such amount, the Company shall forthwith on demand pay the amount
not so paid at the place and in the manner specified in this Agreement.
SECTION 10.02. Guaranty Unconditional. The obligations of the Company
hereunder shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(a) any extension, renewal, settlement, compromise, waiver or release
in respect of any obligation of any Eligible Subsidiary under this
Agreement or any Note or Bankers' Acceptance, by operation of law or
otherwise;
(b) any modification or amendment of or supplement to this Agreement
or any Note or Bankers' Acceptance;
(c) any release, impairment, non-perfection or invalidity of any
direct or indirect security for any obligation of any Eligible Subsidiary
under this Agreement or any Note or Bankers' Acceptance;
(d) any change in the existence, structure or ownership of any
Eligible Subsidiary, or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting any Eligible Subsidiary or its assets or any
resulting release or discharge of any obligation of any Eligible Subsidiary
contained in this Agreement or any Note or Bankers' Acceptance;
(e) the existence of any claim, set-off or other rights which the
Company may have at any time against any Eligible Subsidiary, any Agent,
any Bank or any other Person, whether in connection herewith or any
unrelated transactions, provided that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory counterclaim;
(f) any invalidity or unenforceability relating to or against any
Eligible Subsidiary for any reason of this Agreement or any Note or
Bankers' Acceptance, or any provision of applicable law or regulation
purporting to prohibit the payment by any Eligible Subsidiary of the
principal of or interest on any Loan or any other amount payable by it
under this Agreement or any Note or Bankers' Acceptance; or
(g) any other act or omission to act or delay of any kind by any
Eligible Subsidiary, any Agent or Bank or any other Person or any other
circumstance whatsoever which might, but for the provisions of this
75
paragraph, constitute a legal or equitable discharge of or defense to the
Company's obligations hereunder.
SECTION 10.03. Discharge Only Upon Payment In Full; Reinstatement In
Certain Circumstances. The Company's obligations hereunder shall remain in full
force and effect until the Commitments shall have terminated and the principal
of and interest on the Loans and all other amounts payable by the Company and
each Eligible Subsidiary under this Agreement or any Note or Bankers' Acceptance
shall have been paid in full. If at any time any payment of principal of or
interest on any Loan or any other amount payable by any Eligible Subsidiary
under this Agreement or any Note or Bankers' Acceptance is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of any Eligible Subsidiary or otherwise, the Company's obligations hereunder
with respect to such payment shall be reinstated at such time as though such
payment had been due but not made at such time.
SECTION 10.04. Waiver by the Company. The Company irrevocably waives
acceptance hereof, presentment, demand, protest and any notice not provided for
herein, as well as any requirement that at any time any action be taken by any
Person against any Eligible Subsidiary or any other Person.
SECTION 10.05. Subrogation. The Company irrevocably waives any and all
rights to which it may be entitled, by operation of law or otherwise, upon
making any payment hereunder to be subrogated to the rights of the payee against
an Eligible Subsidiary with respect to such payment or against any direct or
indirect security therefor, or otherwise to be reimbursed, indemnified or
exonerated by or for the account of an Eligible Subsidiary in respect thereof.
SECTION 10.06. Stay of Acceleration. In the event that acceleration of the
time for payment of any amount payable by any Eligible Subsidiary under this
Agreement or any Note or Bankers' Acceptance is stayed upon insolvency,
bankruptcy or reorganization of such Eligible Subsidiary, all such amounts
otherwise subject to acceleration under the terms of this Agreement shall
nonetheless be payable by the Company hereunder forthwith on demand by the
Administrative Agent made at the request of the Required Banks.
SECTION 10.07. Continuing Guaranty. This guaranty is a continuing one and
all liabilities to which it applies or may apply shall be conclusively presumed
to have been created in reliance hereon.
76
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of the Company either Administrative Agent, at its address, facsimile
number or telex number set forth on the signature pages hereof, (b) in the case
of any Bank, at its address, facsimile number or telex number set forth in its
Administrative Questionnaire or (c) in the case of any party, such other
address, facsimile number or telex number as such party may hereafter specify
for the purpose by notice to the Administrative Agents and the Company. Each
such notice, request or other communication shall be effective (i) if given by
telex, when such telex is transmitted to the telex number specified in this
Section and the appropriate answerback is received, (ii) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (iii) if given by mail, 72 hours after
such communication is deposited in the mail with first class postage prepaid,
addressed as aforesaid or (iv) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the
Administrative Agent under Article 2 or Article 8 shall not be effective until
received. Any notice required to be given to or by any Eligible Subsidiary shall
be duly given if given to or by the Company, which is hereby appointed the agent
of each Eligible Subsidiary for such purpose.
SECTION 11.02. No Waivers. No failure or delay by any Agent or Bank in
exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 11.03. Expenses; Indemnification. (a) The Company shall pay (i) all
reasonable out-of-pocket expenses of each Agent, including reasonable fees and
disbursements of special counsel for the Agents, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all reasonable out-of-pocket expenses
reasonably incurred by the Administrative Agents and each Bank, including
(without duplication) the reasonable fees and disbursements of outside counsel
and allocated cost of inside counsel, in connection with such Event of Default
and "work-out", collection, bankruptcy, insolvency and other enforcement
proceedings resulting therefrom.
77
(b) The Company agrees to indemnify each Agent and Bank, their respective
affiliates and the respective directors, officers, agents and employees of the
foregoing (each an "Indemnitee") and hold each Indemnitee harmless from and
against any and all liabilities, losses, damages, costs and expenses of any
kind, including, without limitation, the reasonable fees and disbursements of
counsel, which may be incurred by such Indemnitee in connection with any
investigative, administrative or judicial proceeding (whether or not such
Indemnitee shall be designated a party thereto) brought or threatened relating
to or arising out of this Agreement or any actual or proposed use of proceeds of
Loans or Bankers' Acceptances hereunder; provided that no Indemnitee shall have
the right to be indemnified hereunder for such Indemnitee's own gross negligence
or willful misconduct as determined by a court of competent jurisdiction.
SECTION 11.04. Sharing of Set-offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate amount of principal and interest then due and
payable with respect to any Loan or Bankers' Acceptance of any Class held by it
which is greater than the proportion received by any other Bank in respect of
the aggregate amount of principal and interest then due and payable with respect
to any Loan or Bankers' Acceptance of the same Class held by such other Bank,
the Bank receiving such proportionately greater payment shall purchase such
participations in the Loans and Bankers' Acceptances of the same Class held by
the other Banks, and such other adjustments shall be made, as may be required so
that all such payments of principal and interest with respect to the Loans and
Bankers' Acceptances of the same Class held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right of
any Bank to exercise any right of set-off or counterclaim it may have and to
apply the amount subject to such exercise to the payment of indebtedness of a
Borrower other than its indebtedness hereunder. Each Borrower agrees, to the
fullest extent it may effectively do so under applicable law, that any holder of
a participation in a Loan or Bankers' Acceptance, whether or not acquired
pursuant to the foregoing arrangements, may exercise rights of set-off or
counterclaim and other rights with respect to such participation as fully as if
such holder of a participation were a direct creditor of such Borrower in the
amount of such participation.
SECTION 11.05. Amendments and Waivers. Any provision of this Agreement or
the Notes or Bankers' Acceptances may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Company and the Required
Banks (and, if the rights or duties of any Agent are affected thereby, by such
Agent); provided that no such amendment or waiver shall, unless signed by all
the Banks, (i) increase or decrease the Commitment of any Bank (except for a
ratable decrease in the Commitments of all Banks) or subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on
78
any Loan or Bankers' Acceptance or any fees hereunder, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any scheduled termination of any Commitment or extend the
maturity date of any Bankers' Acceptance, (iv) release or reduce the Guarantee
by the Company in Article 10 hereof or (v) change the percentage of the
Commitments or of the aggregate unpaid Dollar Amount of the Loans and Bankers'
Acceptances, or the number of Banks, which shall be required for the Banks or
any of them to take any action under this Section or any other provision of this
Agreement; provided further that no such amendment, waiver or modification
shall, unless signed by each Eligible Subsidiary, (w) subject such Eligible
Subsidiary to any additional obligation, (x) increase the principal of or rate
of interest on any outstanding Loan or Bankers'Acceptance of such Eligible
Subsidiary, (y) accelerate the stated maturity of any outstanding Loan or
Bankers' Acceptance of such Eligible Subsidiary or (z) change this proviso.
SECTION 11.06. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that no Borrower may assign
or otherwise transfer any of its rights under this Agreement without the prior
written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans or Bankers'Acceptances. In the event of any such grant
by a Bank of a participating interest to a Participant, whether or not upon
notice to the Borrowers and the Administrative Agent, such Bank shall remain
responsible for the performance of its obligations hereunder, and the Borrowers
and the Administrative Agent shall continue to deal solely and directly with
such Bank in connection with such Bank's rights and obligations under this
Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole right
and responsibility to enforce the obligations of the Borrowers hereunder
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement; provided that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause (i), (ii), (iii), or
(iv) of Section 11.05 without the consent of the Participant. The Borrowers
agree that each Participant shall, to the extent provided in its participation
agreement, be entitled to the benefits of Section 2.17 or Article 8 with respect
to its participating interest. An assignment or other transfer which is not
permitted by subsection (c) or (d) below shall be given effect for purposes of
this Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).
79
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part (equivalent to an
initial Commitment of not less than $10,000,000) of all, of its rights and
obligations under this Agreement and the Notes and Bankers' Acceptances, in
respect of the US Subfacility or the Canadian Subfacility or both, and such
Assignee shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement in substantially the form of Exhibit K hereto executed by
such Assignee and such transferor Bank, with (and subject to) the subscribed
consent of the Company, BetzDearborn Canada and the Administrative Agents, which
shall not be unreasonably withheld; provided that if an Assignee is a
wholly-owned subsidiary of such transferor Bank or of such transferor Bank's
Parent or was a Bank immediately prior to such assignment, no such consent shall
be required; provided further such assignment may, but need not, include rights
of the transferor Bank in respect of outstanding Money Market Loans; and
provided further in order to ensure the continued operation of Section 2.10(b),
no Canadian Bank and no US Bank having a Related Canadian Bank may assign its
Commitment in whole or in part unless either (x) the Assignee has a Related Bank
which simultaneously assumes any obligations of the Related Bank of the
transferor Bank with respect to the assigned Commitment or (y) in the case of an
assignment of a US Commitment, no increase in the aggregate amount of the
Canadian Commitments would be possible under Section 2.10(b) at the time of such
assignment. Upon execution and delivery of such instrument and payment by such
Assignee to such transferor Bank of an amount equal to the purchase price agreed
between such transferor Bank and such Assignee, such Assignee shall be a Bank
party to this Agreement and shall have all the rights and obligations of a Bank
with Commitments as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank, the Administrative Agent and the Borrowers shall make
appropriate arrangements so that, if requested, Note(s) are issued to the
Assignee. In connection with any such assignment, the transferor Bank shall pay
to the Administrative Agent an administrative fee for processing such assignment
in the amount of $2,500. With respect to the US Subfacility, if the Assignee is
not incorporated under the laws of the United States of America or a state
thereof, it shall deliver to the Company and the Administrative Agent
certification as to exemption from deduction or withholding of any United States
federal income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its rights under
this Agreement and its Notes to a Federal Reserve Bank. No such assignment shall
release the transferor Bank from its obligations hereunder.
80
(e) No Assignee, Participant or other transferee of any Bank's rights shall
be entitled to receive any greater payment under Section 8.03 or 8.04 than such
Bank would have been entitled to receive with respect to the rights transferred,
unless such transfer is made with the Company's prior written consent after
disclosure of such Assignee's, Participant's or other transferee's intention to
seek such greater payments or by reason of the provisions of Section 8.02, 8.03
or 8.04 requiring such Bank to designate a different Applicable Lending Office
under certain circumstances or at a time when the circumstances giving rise to
such greater payment did not exist.
SECTION 11.07. Collateral. Each of the Banks represents to each Agent and
each of the other Banks that it in good faith is not relying upon any "margin
stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 11.08. Governing Law; Submission to Jurisdiction. This Agreement
and each Note shall be governed by and construed in accordance with the laws of
the State of New York. Each Borrower hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State court sitting in New York City for purposes
of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. Each Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
SECTION 11.09. Counterparts; Integration; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersede any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon receipt by the Administrative Agent of
counterparts hereof signed by each of the Company, the Banks and the
Administrative Agent (or, in the case of any party as to which an executed
counterpart shall not have been received, receipt by the Administrative Agent in
form satisfactory to it of telegraphic, telex, facsimile or other written
confirmation from such party of execution of a counterpart hereof by such
party).
SECTION 11.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWERS, THE
ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
81
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 11.11. Confidentiality. The Administrative Agent and each Bank
agree to keep any information delivered or made available by the Borrowers
pursuant to this Agreement confidential from anyone other than persons employed
or retained by such Bank who are engaged in evaluating, approving, structuring
or administering the credit facility contemplated hereby; provided that nothing
herein shall prevent any Bank from disclosing such information (a) to any other
Bank or to the Administrative Agent, (b) to any other Person if reasonably
incidental to the administration of the credit facility contemplated hereby, (c)
upon the order of any court or administrative agency, (d) upon the request or
demand of any regulatory agency or authority, (e) which had been publicly
disclosed other than as a result of a disclosure by the Administrative Agent or
such Bank prohibited by this Agreement, (f) in connection with any litigation to
which the Administrative Agent, any Bank or its subsidiaries or Parent may be a
party, (g) to the extent necessary in connection with the exercise of any remedy
hereunder, (h) to such Bank's or Administrative Agent's legal counsel and
independent auditors and (i) subject to provisions substantially similar to
those contained in this Section, to any actual or proposed Participant or
Assignee.
82
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
BETZDEARBORN INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III
-------------------------------------
Title: Vice President and Chief
Financial Officer
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
BETZDEARBORN CANADA INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Vice President
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ L5C259
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
US ▇▇▇▇▇
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS
ASSOCIATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Vice President
83
THE CHASE MANHATTAN BANK
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Title: Managing Director
BANK OF MONTREAL
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Title: Director
COMMERZBANK AG
NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Title: Assistant Treasurer
CORESTATES BANK, N.A.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
84
DEUTSCHE BANK AG, NEW YORK
AND/OR CAYMAN ISLANDS
BRANCHES
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
THE FIRST NATIONAL BANK OF
CHICAGO
By /s/ ▇▇▇ ▇▇▇
-------------------------------------
Title: Corporate Banking Officer
PNC BANK, NATIONAL ASSOCIATION
By /s/ ▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Title: Vice President
ROYAL BANK OF CANADA
By /s/ ▇.▇. ▇▇▇▇▇▇
-------------------------------------
Title: Senior Manager
BANCA COMMERICALE ITALIANA
NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President/Vice President
▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
ISTITUTO BANCARIO SAN PAOLO DI
TORINO, SPA
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Title: Assistant Vice President
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇
-------------------------------------
Title: First Vice President
KREDIETBANK N.V.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
86
SOCIETE GENERALE
NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
THE SUMITOMO BANK, LIMITED
NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Title: Joint General Manager
CANADIAN BANKS
▇.▇. ▇▇▇▇▇▇ CANADA
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President & Controller
BANK OF AMERICA CANADA
By /s/ ▇▇▇▇▇ ▇. Kong
-------------------------------------
Title: Vice President
THE CHASE MANHATTAN BANK OF
CANADA
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Title: Vice President
87
BANK OF MONTREAL
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Title: Director
DEUTSCHE BANK CANADA
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President & Director
By /s/ ▇.▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
FIRST CHICAGO NBD BANK, CANADA
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Title: First Vice President
ROYAL BANK OF CANADA
By /s/ ▇.▇. ▇▇▇▇▇▇
-------------------------------------
Title: Senior Manager
BANCA COMMERCIALE ITALIANA
OF CANADA
By /s/ Massimo Osti/▇▇▇▇▇▇ ▇.▇. ▇▇
-------------------------------------
Title: Executive Vice President/
Department Manager - Credit
▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ BANK, as
General Administrative Agent
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Title: Managing Director
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: 212-270-7939
THE CHASE MANHATTAN BANK OF
CANADA, as Canadian Administrative
Agent
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Title: Vice President
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
89
EXHIBIT A - Pricing Schedule
PRICING SCHEDULE
Each of "Euro-Dollar Margin", "CD Margin", "BA Margin" and "Facility Fee
Rate" means, for any date, the rate set forth below in the row opposite such
term and in the column corresponding to the "Pricing Level" that applies at such
date:
----------------------------------------------------------------------------------------------------
Level I ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇
----------------------------------------------------------------------------------------------------
CD Margin 0.260% 0.280% 0.295% 0.325% 0.375% 0.525%
----------------------------------------------------------------------------------------------------
Euro-Dollar Margin
or BA Margin 0.135% 0.155% 0.170% 0.200% 0.250% 0.400%
----------------------------------------------------------------------------------------------------
Facility Fee Rate 0.065% 0.070% 0.080% 0.100% 0.125% 0.200%
----------------------------------------------------------------------------------------------------
For purposes of this Schedule, the following terms have the following
meanings, subject to the last paragraph of this Schedule:
"Applicable Pricing Ratio" means, for any day, the ratio of Consolidated
Debt to Consolidated EBITDA as at the last day of the fiscal quarter of the
Company most recently ended prior to such date for which the Company has
delivered financial statements pursuant to Section 5.01(a) or 5.01(b), as the
case may be; provided that until the Company shall have delivered financial
statements pursuant to Section 5.01(a) for the fiscal year ended December 31,
1997, the Applicable Pricing Ratio shall be deemed to be a ratio resulting in
Level IV Pricing; and provided further that if at any time the Company shall
fail to timely deliver the financial statements required to be delivered by it
pursuant to Section 5.01(a) or 5.01(b), as the case may be, the Applicable
Pricing Ratio for each date from and including the date on which such statements
are required to be delivered (the "statement due date") shall be the higher
pricing of the Applicable Pricing Ratio in effect prior to the delivery of each
financial statements and the Applicable Pricing Ratio in effect upon delivery of
such financial statements; provided, further that if the Company shall have
failed to deliver such statements by the day that is 30 days after the statement
due date, then the Applicable Price Ratio for each date from the statement due
date until the date on which such statements are delivered shall be deemed to be
greater than 3.0:1.
"Level I Pricing" applies at any date if, at such date, (x) the Company's
Applicable Pricing Ratio is less than or equal to 1.0:1 or (y) if the Company
has exercised and not revoked its One-Time Pricing Option, the Company's
long-term debt is rated A or higher by S&P or A2 or higher by ▇▇▇▇▇'▇.
"Level II Pricing" applies at any date if, at such date, (i) (x) the
Company's Applicable Pricing Ratio is less than or equal to 1.5:1 or (y) if the
Company has exercised and not revoked its One-Time Pricing Option, the Company's
long-term debt is rated A- or higher by S&P or A3 or higher by ▇▇▇▇▇'▇ and (ii)
Level I Pricing does not apply.
"Level III Pricing" applies at any date if, at such date, (i) (x) the
Company's Applicable Pricing Ratio is less than or equal to 2.0:1 or (y) if the
Company has exercised and not revoked its One-Time Pricing Option, the Company's
long-term debt is rated BBB+ or higher by S&P or Baa1 or higher by ▇▇▇▇▇'▇ and
(ii) neither Level I Pricing nor Level II Pricing applies.
"Level IV Pricing" applies at any date if, at such date, (i) (x) the
Company's Applicable Pricing Ratio is less than or equal to 2.5:1 or (y) if the
Company has exercised and not revoked its One-Time Pricing Option, the Company's
long-term debt is rated BBB or higher by S&P or Baa2 or higher by ▇▇▇▇▇'▇ and
(ii) none of Level I Pricing, Level II Pricing and Level III Pricing applies.
"Level V Pricing" applies at any date if, at such date, (i) (x) the
Company's Applicable Pricing Ratio is less than or equal to 3.0:1 or (y) if the
Company has exercised and not revoked its One-Time Pricing Option, the Company's
long-term debt is rated BBB- or higher by S&P or Baa3 or higher by ▇▇▇▇▇'▇ and
(ii) none of Level I Pricing, Level II Pricing, Level III Pricing and Level IV
Pricing applies.
"Level VI Pricing" applies at any date if, at such date, no other Pricing
Level applies.
"One-Time Pricing Option" means the one-time option of the Company during
the life of this facility to switch to a ratings-based pricing grid. Such option
shall be considered to be exercised, and thereafter in effect subject to clause
(ii) of the proviso to paragraph (b) below, on the day of receipt by the
Administrative Agent of the Company's notification of its exercise of such
option.
"Pricing Level" refers to the determination of which of Level I, Level II,
Level III, Level IV, Level V or Level VI applies at any date.
Upon the One-Time Pricing Option being exercised, the following shall
apply:
(a) The credit ratings to be utilized for purposes of this Schedule are
those assigned to the senior unsecured long-term debt securities of the Company
without third-party credit enhancement, whether or not any such debt securities
2
are actually outstanding, and any rating assigned to any other debt security of
the Company shall be disregarded. The rating in effect at any date is that in
effect at the close of business on such date.
(b) If the Company is split-rated and the ratings differential is one
notch, the higher of the two ratings will apply (e.g., A-/Baa1 results in Level
II Status and BBB+/Baa2 results in Level III Status). If the Company is
split-rated and the ratings differential is more than one notch, the average of
the two ratings (or the higher of two intermediate ratings) shall be used (e.g.,
A-/Baa3 results in Level III Status and BBB+/Baa3 results in Level IV Status).
If, however, at any date, the Company's long-term debt is not rated by both S&P
and ▇▇▇▇▇'▇, then Level VI shall apply; provided that if either ▇▇▇▇▇'▇ or S&P
shall cease to issue a rating of the Company's long-term debt, then (i) the
Company, together with the Administrative Agent, shall substitute another
mutually satisfactory nationally recognized credit rating agency for either
▇▇▇▇▇'▇ or S&P, as the case may be, and this Pricing Schedule shall apply in
respect of the equivalent ratings of such rating agency or (ii) the Company may
revoke its exercise of the One-Time Pricing Option effective on the date of the
Administrative Agent's receipt of notice of revocation.
3
EXHIBIT B - Note
NOTE
New York, New York
---------- --, ----
For value received, [Name of Borrower], a [jurisdiction of incorporation]
(the "Borrower"), promises to pay to the order of ______________________ (the
"Bank"), for the account of its Applicable Lending Office, the unpaid principal
amount of each Loan made by the Bank to the Borrower pursuant to the Credit
Agreement referred to below on the maturity date provided for in the Credit
Agreement. The Borrower promises to pay interest on the unpaid principal amount
of each such Loan on the dates and at the rate or rates provided for in the
Credit Agreement. All such payments of principal and interest shall be made in
the funds and at the places specified pursuant to the Credit Agreement.
All Loans made by the Bank to the Borrower, the respective Classes, Types,
currencies and maturities thereof and all repayments of the principal thereof
shall be recorded by the Bank and, if the Bank so elects in connection with any
transfer or enforcement hereof, appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding may be endorsed by
the Bank on the schedule attached hereto, or on a continuation of such schedule
attached to and made a part hereof; provided that the failure of the Bank to
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement dated as
of October 20, 1997 among BetzDearborn Inc., BetzDearborn Canada Inc., the Banks
parties thereto, and The Chase Manhattan Bank and The Chase Manhattan Bank of
Canada, as Administrative Agents (as the same may be amended from time to time,
the "Credit Agreement"). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit
Agreement for provisions for the prepayment hereof and the acceleration of the
maturity hereof.
[The payment in full of the principal and interest on this note has,
pursuant to the provisions of the Credit Agreement, been unconditionally
guaranteed by BetzDearborn Inc.](1)
[NAME OF BORROWER]
By
--------------------------------
Name:
Title:
--------
(1) To be deleted in the case of Notes executed and delivered by the
Company.
2
LOANS AND PAYMENTS OF PRINCIPAL
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Amount and Class and Amount of
Currency of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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3
EXHIBIT C - Money Market Quote
Request
Form of Money Market Quote Request
[Date]
To: The Chase Manhattan Bank (the "Administrative Agent")
From: [Name of Borrower]
Re: Credit Agreement (the "Credit Agreement") dated as of October 20, 1997
among BetzDearborn Inc., BetzDearborn Canada Inc., the Banks parties
thereto, and The Chase Manhattan Bank and The Chase Manhattan Bank
of Canada, as Administrative Agents.
We hereby give notice pursuant to Section 2.04 of the Credit Agreement
that we request Money Market Quotes for the following proposed Money Market
Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
---------------- ---------------
Such Money Market Quotes should offer a Money Market [Margin] [Absolute
Rate]. [The applicable base rate is the London Interbank Offered Rate.]
Terms used herein have the meanings assigned to them in the Credit
Agreement.
[NAME OF BORROWER]
By
--------------------------------
Name:
Title:
EXHIBIT D - Invitation for Money
Market Quotes
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes to [Name of Borrower] (the "Borrower")
Pursuant to Section 2.04 of the Credit Agreement dated as of October 20,
1997 among BetzDearborn Inc., BetzDearborn Canada Inc., the Banks parties
thereto, and the undersigned and The Chase Manhattan Bank of Canada, as
Administrative Agents, we are pleased on behalf of the Borrower to invite you to
submit Money Market Quotes to the Borrower for the following proposed Money
Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
---------------- ---------------
Such Money Market Quotes should offer a Money Market [Margin] [Absolute
Rate]. [The applicable base rate is the London Interbank Offered Rate.]
[Each bid must be for _______________ or a larger multiple of
_________.](1)
Please respond to this invitation by no later than [2:00 P.M.]
[9:30 A.M.] (Eastern time) on [date].
THE CHASE MANHATTAN BANK,
as Administrative Agent
By
--------------------------------
Authorized Officer
--------
(1) For Alternative Currency only.
EXHIBIT E - Money Market Quote
Form of Money Market Quote
To: The Chase Manhattan Bank, as Administrative Agent
Re: Money Market Quote to [Name of Borrower] (the "Borrower")
In response to your invitation on behalf of the Borrower dated
_____________, ____, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: ________________________________
2. Person to contact at Quoting Bank:
-----------------------------
3. Date of Borrowing: ____________________*
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
Principal Interest Money Market [Absolute
Amount** Period*** [Margin****] Rate*****]
--------- --------- ------------ ----------
[Provided, that the aggregate principal amount of Money Market Loans
for which the above offers may be accepted shall not exceed
____________.]**
----------
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the individual
offers exceeds the amount the Bank is willing to lend. Each bid must be
made for $5,000,000 or a larger multiple of $1,000,000 (or a comparable
amount in an Alternative Currency as determined by the Administrative Agent
and specified in the related Invitation).
(notes continued on following page)
We understand and agree that the offer(s) set forth above, subject to
the satisfaction of the applicable conditions set forth in the Credit Agreement
dated as of October 20, 1997 among BetzDearborn Inc., BetzDearborn Canada Inc.,
the Banks parties thereto, and yourselves and The Chase Manhattan Bank of
Canada, as Administrative Agents, irrevocably obligates us to make the Money
Market Loan(s) for which any offer(s) are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated: By:
---------------------- ------------------------------------
Authorized Officer
----------
*** No more than five bids are permitted for each Interest Period.
**** Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period. Specify percentage (to the nearest 1/10,000 of
1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
2
EXHIBIT F-1 - Opinion of Counsel for the
Company and United States Counsel
for BetzDearborn Canada
________________, 1997
To the Banks and the Administrative Agents
Referred to Below
c/o The Chase Manhattan Bank,
as General Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Dear Sirs:
We have acted as counsel for BetzDearborn Inc. (the "Company") and as
United States counsel for BetzDearborn Canada Inc. ("BetzDearborn Canada") in
connection with the Credit Agreement (the "Credit Agreement") dated as of
October 20, 1997 among the Company, BetzDearborn Canada, the Banks parties
thereto, and The Chase Manhattan Bank (the "General Administrative Agent") and
The Chase Manhattan Bank of Canada, as Administrative Agents. Terms defined in
the Credit Agreement are used herein as therein defined. This opinion is being
rendered to you at the request of our clients pursuant to Section 3.01(b) of the
Credit Agreement.
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as we have deemed necessary or advisable for purposes of this
opinion.
Upon the basis of the foregoing and subject to the qualifications set forth
below, we are of the opinion that:
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of Pennsylvania and has all corporate power
required to carry on its business as described in the Company's 1996 Form 10-K.
2. The execution, delivery and performance by the Company of the Credit
Agreement and its Notes are within the corporate power of the Company, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the articles of incorporation or bylaws of the Company or of
any agreement, judgment, injunction, order, decree or other instrument known to
us to be binding upon the Company or any of its Subsidiaries or result in the
creation or imposition of any Lien on any asset of the Company or any of its
Subsidiaries pursuant to any of the foregoing.
3. The execution, delivery and performance by BetzDearborn Canada of the
Credit Agreement and its Notes require no action by or in respect of, or filing
with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
any agreement, judgment, injunction, order, decree or other instrument known to
us to be binding upon BetzDearborn Canada or any of its Subsidiaries or result
in the creation or imposition of any Lien on any asset of BetzDearborn Canada or
any of its Subsidiaries pursuant to any of the foregoing.
4. The Credit Agreement has been duly executed and delivered by, and
constitutes a valid and binding agreement of, the Company and BetzDearborn
Canada and each of the Notes of the Company and BetzDearborn Canada,
respectively, has been duly executed and delivered by, and constitutes a valid
and binding obligation of, the Company or BetzDearborn Canada, as the case may
be, in each case enforceable in accordance with its terms except as the same may
be limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
We have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. We have also assumed
that the Credit Agreement constitutes the legal, valid and binding agreement of
the Administrative Agents and the Banks.
Whenever our opinion herein with respect to the existence or absence of
facts is indicated to be based on our knowledge, it is intended to signify that
no information has come to the attention of the lawyers actually involved in our
representation of the Company in connection with the Credit Agreement and the
lawyer having overall responsibility for our representation of the Company that
would give us actual present knowledge of the existence or absence of facts. We
have not, however, undertaken any independent investigation to determine the
existence or absence of such facts.
In giving the opinion in paragraph 4 as to BetzDearborn Canada we have
relied with your permission on the opinions of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Verchere, Canadian
2
counsel for BetzDearborn Canada, contained in its opinion letter of even date
herewith delivered to you in connection with the Credit Agreement.
This opinion is limited to the laws of the Commonwealth of Pennsylvania,
the State of New York and the federal laws of the United States of America.
This opinion is being delivered to you solely for your benefit in
connection with the Credit Agreement and may not be relied upon by any other
person or for any other purpose without our prior written consent.
Very truly yours,
3
EXHIBIT F-2 - Opinion of Canadian
Counsel for BetzDearborn Canada
___________, 1997
The Banks and the Administrative Agents
referred to below
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank,
as General Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Dear Sirs:
Re: BetzDearborn Canada Inc.
------------------------
We have acted as Canadian counsel to BetzDearborn Canada Inc.
("BetzDearborn Canada") in connection with a Credit Agreement (the "Credit
Agreement") dated as of October 20, 1997 among BetzDearborn Inc. (the
"Company"), BetzDearborn Canada, the Banks parties thereto, and The Chase
Manhattan Bank (the "General Administrative Agent") and The Chase Manhattan Bank
of Canada, as Administrative Agents. Terms defined in the Credit Agreement are
used herein as therein defined.
For the purposes of the opinions expressed below, we have examined
originals or copies of the following documents:
1. a copy, certified by an officer of BetzDearborn Canada, of the
Articles of Amalgamation of BetzDearborn Canada (the "Articles");
2. a copy, certified by an officer of BetzDearborn Canada, of the by-
laws of BetzDearborn Canada (the "By-laws");
3. a copy, certified by an officer of BetzDearborn Canada, of a
resolution of the board of directors of BetzDearborn Canada,
authorizing, among other things, the execution and delivery of the
Credit Agreement;
4. a certificate of status (the "Certificate of Status") for BetzDearborn
Canada issued by the Ministry of Consumer and Commercial
Relations Ontario in respect of BetzDearborn Canada dated __________,
1997;
5. a certificate of incumbency of BetzDearborn Canada of even date
herewith;
6. the Credit Agreement; and
7. the form of promissory note (the "Note") to be delivered by
BetzDearborn Canada to the Bank(s) in connection with Loans made to
BetzDearborn Canada.
We have also considered such statutes and regulations of the Province of
Ontario and of Canada applicable in Ontario ("Ontario Law") as we have
considered necessary as a basis for the opinions hereinafter expressed.
As to certain matters of fact material to our opinions, we have also
examined and relied exclusively and without independent verification on a
certificate of the President of BetzDearborn Canada (the "Officer's
Certificates"), a copy of which is delivered therewith.
Assumptions
For the purposes of the opinions hereinafter expressed, we have made the
following assumptions:
1. that all signatures are genuine, all documents submitted to us as
originals are authentic, and all documents submitted to us as copies
conform to authentic original documents;
2. that all facts set forth in official public records and certificates
and other documents supplied by public officials or otherwise conveyed
to us by public officials are complete, true and accurate;
3. that the Certificate of Status is conclusive evidence that
BetzDearborn Canada is an amalgamated corporation and a subsisting
corporation under the laws of Ontario and has not been dissolved
thereunder and that a similar certificate bearing a current date could
be obtained.
2
Applicable Law
We are solicitors qualified to practice law only in the Province of
Ontario. Accordingly, we do not express any opinion with respect to the laws of
any other jurisdiction other than Ontario Law as of the date of this opinion
letter.
Opinions
Based and relying upon the foregoing, and subject to the qualifications
listed below, we are of the opinion that:
1. BetzDearborn Canada is a corporation amalgamated and validly existing
under the laws of Ontario and has not been dissolved;
2. BetzDearborn Canada has the corporate power and authority to execute,
deliver and perform its obligations under the Credit Agreement and the
Notes (the "Documents");
3. the execution, delivery and performance of the Documents has been
authorized by all necessary corporate action of BetzDearborn Canada;
4. BetzDearborn Canada has duly executed and delivered each of the
Documents;
5. the execution, delivery and performance by BetzDearborn Canada of the
Documents does not constitute or result in a violation or a breach of,
or a default under:
(a) its Articles or By-laws;
(b) any Ontario Law to which BetzDearborn Canada is subject; or
(c) any agreement, judgment, injunction, order, decree or other
instrument known to us to be binding upon BetzDearborn Canada;
6. Under the Income Tax Act (Canada), the Regulations thereunder and the
publicly-announced administrative practices of Revenue Canada as of
the date hereof, taxes in the form of Canadian non-resident
withholding tax will be imposed on payments made by BetzDearborn
Canada to any Bank which is not a Schedule I Bank or a Schedule II
Bank and is neither incorporated in Canada (after
3
26 April, 1965) nor carries on business in Canada through a permanent
establishment to which the payment is attributable.
7. There is no registration tax, stamp duty or any similar tax or duty
imposed by Ontario Law by virtue of the execution and delivery of the
Documents by the parties thereto or the performance of their
obligations thereunder.
The choice of New York law as the governing law of the Credit Agreement and
the Notes will be upheld as a valid choice of law by the courts of the Province
of Ontario provided that such choice of law is bona fide (in the sense that it
was not made with a view to avoiding the consequences of the law of any other
jurisdiction) and provided that such choice of law is not contrary to public
policy, as that term is understood under the laws of the Province of Ontario. We
have no reason to believe that the choice of law in the Credit Agreement and the
Notes would not be upheld.
Qualifications
Our opinions expressed above are subject to the following qualification:
1. The validity, binding effect and enforceability of each of the
Documents or any judgment arising out of or in connection with any
Document may be limited by applicable bankruptcy, insolvency,
winding-up, reorganization, arrangement, moratorium or other similar
laws affecting creditors' rights generally and by general principles
of equity.
Yours truly,
▇▇▇▇▇▇▇ ▇▇▇▇▇ VERCHERE
4
EXHIBIT G - Opinion of Special Counsel
for the Administrative Agents
OPINION OF
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, SPECIAL COUNSEL
FOR THE AGENTS
________________, 199_
To the Banks and the Administrative Agents
Referred to Below
c/o The Chase Manhattan Bank,
as General Administrative Agent
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Dear Sirs:
We have participated in the preparation of the Credit Agreement (the
"Credit Agreement") dated as of October 20, 1997 among BetzDearborn Inc., a
Pennsylvania corporation, BetzDearborn Canada Inc., a corporation organized and
existing under the laws of Ontario, the Banks parties thereto, and The Chase
Manhattan Bank (the "General Administrative Agent") and The Chase Manhattan Bank
of Canada, as Administrative Agents, and have acted as special counsel for the
Administrative Agents for the purpose of rendering this opinion pursuant to
Section 3.01(d) of the Credit Agreement. Terms defined in the Credit Agreement
are used herein as therein defined.
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as we have deemed necessary or advisable for purposes of this
opinion.
Upon the basis of the foregoing, we are of the opinion that the Credit
Agreement constitutes a valid and binding agreement of each of the Company and
BetzDearborn Canada, and each of their respective Notes constitutes a valid and
binding obligation of its maker, in each case enforceable in accordance with its
terms except as the same may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and by general principles of equity.
We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York and the federal laws of
the United States of America. In giving the foregoing opinion, (i) we express no
opinion as to the effect (if any) of any law of any jurisdiction (except the
State of New York) in which any Bank is located which limits the rate of
interest that such Bank may charge or collect and (ii) as to all matters
governed by the laws of the Commonwealth of Pennsylvania or Canada, we have
relied, without independent investigation, on the respective opinions of ▇▇▇▇▇▇,
▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company, and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Verchere,
counsel for BetzDearborn Canada, copies of which have been delivered to you.
This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other purpose or relied upon
by any other person without our prior written consent.
Very truly yours,
2
EXHIBIT H - Form of Election to
Participate
FORM OF ELECTION TO PARTICIPATE
[Date]
THE CHASE MANHATTAN BANK,
as General Administrative Agent for the Banks parties to the Credit
Agreement dated as of October 20, 1997 among BetzDearborn Inc,
BetzDearborn Canada Inc., such Banks, and such Administrative Agent
and The Chase Manhattan Bank of Canada, as Administrative Agents.
(the "Credit Agreement")
Dear Sirs:
Reference is made to the Credit Agreement described above. Terms not
defined herein which are defined in the Credit Agreement shall have for the
purposes hereof the meaning provided therein.
The undersigned, [name of Eligible Subsidiary], a [jurisdiction of
incorporation] corporation, hereby elects to be an Eligible Subsidiary for
purposes of the Credit Agreement, effective from the date hereof until an
Election to Terminate shall have been delivered on behalf of the undersigned in
accordance with the Credit Agreement. The undersigned confirms that the
representations and warranties set forth in Article 9 of the Credit Agreement
are true and correct as to the undersigned as of the date hereof, and the
undersigned hereby agrees to perform all the obligations of an Eligible
Subsidiary under, and to be bound in all respects by the terms of, the Credit
Agreement, including without limitation Sections 11.01 and 11.08 thereof, as if
the undersigned were a signatory party thereto.
[Tax disclosure pursuant to Section 9.04]
This instrument shall be construed in accordance with and governed by the
laws of the State of New York.
Very truly yours,
[NAME OF ELIGIBLE SUBSIDIARY]
By
-------------------------------------
Title:
The undersigned hereby confirms that [name of Eligible Subsidiary] is an
Eligible Subsidiary for purposes of the Credit Agreement described above.
BETZDEARBORN INC.
By
-------------------------------------
Title:
Receipt of the above Election to Participate is hereby acknowledged on and
as of the date set forth above.
THE CHASE MANHATTAN BANK,
as General Administrative Agent
By
-------------------------------------
Title:
2
EXHIBIT I - Form of Election to
Terminate
FORM OF ELECTION TO TERMINATE
[Date]
THE CHASE MANHATTAN BANK,
as General Administrative Agent for the Banks parties to the Credit
Agreement dated as of October 20, 1997 among BetzDearborn Inc.,
BetzDearborn Canada Inc., such Banks, and such Administrative Agent and The
Chase Manhattan Bank of Canada, as Administrative Agents (the "Credit
Agreement")
Dear Sirs:
Reference is made to the Credit Agreement described above. Terms not
defined herein which are defined in the Credit Agreement shall have for the
purposes hereof the meaning provided therein.
The undersigned, [name of Eligible Subsidiary], a [jurisdiction of
incorporation] corporation, hereby elects to terminate its status as an Eligible
Subsidiary for purposes of the Credit Agreement, effective as of the date
hereof. The undersigned hereby represents and warrants that all principal and
interest on all Notes of the undersigned and all other amounts payable by the
undersigned pursuant to the Credit Agreement have been paid in full on or prior
to the date hereof. Notwithstanding the foregoing, this Election to Terminate
shall not affect any obligation of the undersigned under the Credit Agreement or
under any Note heretofore incurred.
This instrument shall be construed in accordance with and governed by the
laws of the State of New York.
Very truly yours,
[NAME OF ELIGIBLE SUBSIDIARY]
By
-------------------------------------
Title:
The undersigned hereby confirms that the status of [name of Eligible
Subsidiary] as an Eligible Subsidiary for purposes of the Credit Agreement
described above is terminated as of the date hereof.
BETZDEARBORN INC.
By
-------------------------------------
Title:
Receipt of the above Election to Terminate is hereby acknowledged on and as
of the date set forth above.
THE CHASE MANHATTAN BANK,
as General Administrative Agent
By
-------------------------------------
Title:
2
EXHIBIT J - Matters to be covered in the
Opinions of Counsel for the Eligible
Subsidiary and the Company
1. The Borrower is a corporation validly existing and in good standing
under the laws of [jurisdiction of organization].
2. The execution and delivery by the Borrower of its Election to
Participate and its Notes and the performance by the Borrower of the Credit
Agreement and its Notes are within the Borrower's powers, have been duly
authorized by all necessary action, require no action by or in respect of, or
filing with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
the [charter and similar documents] or bylaws of the Borrower or of any
agreement, judgment, injunction, order, decree or other instrument known to such
counsel to be binding upon the Borrower or the Company or any of its
Subsidiaries or result in the creation or imposition of any Lien on any asset of
the Company or any of its Subsidiaries pursuant to any of the foregoing.
3. The Borrower's Election to Participate has been duly executed and
delivered and the Credit Agreement constitutes a valid and binding agreement of
the Borrower and each of its Notes has been duly executed and delivered and
constitutes a valid and binding obligation of the Borrower, in each case
enforceable in accordance with its terms except as the same may be limited by
bankruptcy, insolvency and other similar laws affecting creditors' rights
generally and by general principles of equity.
4. Except as disclosed in the Borrower's Election to Participate, there are
no Taxes or Other Taxes of [jurisdiction of organization and, if different,
principal place of business], or any taxing authority thereof or therein, which
is imposed on any payment to be made by the Borrower pursuant to the Credit
Agreement or its Notes, or imposed on or by virtue of the execution, delivery or
enforcement of its Election to Participate, the Credit Agreement or its Notes.
EXHIBIT K - Form of Assignment and
Assumption Agreement
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, ____ among (less than)NAME OF
ASSIGNOR(greater than) (the "Assignor"), [(less than)NAME OF ASSIGNOR'S RELATED
BANK(greater than) (the "Assignor's Related Bank")],(1) (less than)NAME OF
ASSIGNEE(greater than) (the "Assignee"), [(less than)NAME OF ASSIGNEE'S RELATED
BANK(greater than) (the "Assignee's Related Bank")](2), BETZDEARBORN INC. (the
"Company"), BETZDEARBORN CANADA INC. ("BetzDearborn Canada") and THE CHASE
MANHATTAN BANK, as General Administrative Agent (the "General Administrative
Agent") and THE CHASE MANHATTAN BANK OF CANADA, as Canadian Administrative Agent
(the "Canadian Administrative Agent").
WHEREAS, this Assignment and Assumption Agreement (the "Agreement") relates
to the Credit Agreement dated as of October 20, 1997 among the Company,
BetzDearborn Canada, the Assignor and the other Banks parties thereto, as Banks,
the General Administrative Agent and the Canadian Administrative Agent, as
Administrative Agents (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor has a
[US][Canadian] Commitment to make [US][Canadian] Loans [or accept Bankers'
Acceptances] in an aggregate Dollar Amount at any time outstanding not to exceed
$__________;
WHEREAS, Committed [US][Canadian] Loans made by the Assignor [and Bankers'
Acceptances accepted by the Assignor] under the Credit Agreement in the
aggregate Dollar Amount of $__________ are outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the rights
of the Assignor under the Credit Agreement in respect of a portion of its
[US][Canadian] Commitment thereunder in an amount equal to $__________ (the
"Assigned Amount"), together with a corresponding portion of its outstanding
Committed Loans [and Bankers' Acceptances], and the Assignee proposes to
--------
(1) Not necessary if (i) the Assignor is a Canadian Bank and a US Bank or
(ii) in the case of an assignment of a US Commitment, the aggregate amount of
the Canadian Commitments cannot be increased under Section 2.10(b) of the Credit
Agreement on the date hereof.
(2) Not necessary if (i) the Assignee is a Canadian Bank and a US Bank or
(ii) in the case of an assignment of a US Commitment, the aggregate amount of
the Canadian Commitments cannot be increased under Section 2.10(b) of the Credit
Agreement on the date hereof.
accept assignment of such rights and assume the corresponding obligations from
the Assignor on such terms;
[WHEREAS, pursuant to Section 2.10(b) of the Credit Agreement, all or a
portion of the Assignor's [US][Canadian] Commitment may be reallocated to the
[Canadian][US] Commitment of the Assignor's Related Bank; and
WHEREAS, the Assignee's Related Bank wishes to assume the obligations of
the Assignor's Related Bank, and to accept assignment of the rights of the
Assignor's Related Bank, which may arise with respect to the Assigned Amount
pursuant to Section 2.10(b) of the Credit Agreement;]
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Committed Loans made by the Assignor outstanding at the date hereof. [The
[Assignor][Assignor's Related Bank] hereby assigns and sells to the
[Assignee][Assignee's Related Bank] all of the rights of the
[Assignor][Assignor's Related Bank] which may arise under Section 2.10(b) of
Credit Agreement with respect to the Assigned Amount, and the
[Assignee][Assignee's Related Bank] hereby accepts such assignment from the
[Assignor][Assignor's Related Bank] and assumes all of the obligations of the
[Assignor][Assignor's Related Bank] which may arise under Section 2.10(b) of the
Credit Agreement with respect to the Assigned Amount]. Upon the execution and
delivery hereof by the Assignor, [the Assignor's Related Bank,] the Assignee,
[the Assignee's Related Bank,] [the Company, BetzDearborn Canada, the General
Administrative Agent and the Canadian Administrative Agent](3) and the payment
of the amounts specified in Section 3 required to be paid on the date hereof (i)
the Assignee shall, as of the date hereof, succeed to the rights and be
obligated to perform the obligations of a Bank under the Credit Agreement with a
[US][Canadian] Commitment in an amount equal to the Assigned Amount, and (ii)
the [US][Canadian] Commitment of the Assignor shall, as of the date hereof, be
reduced by a like amount and the Assignor [and its Related Bank] released
--------
(3) Not necessary if the Assignee is a Bank.
2
from [its][their] obligations under the Credit Agreement to the extent such
obligations have been assumed by the Assignee [and its Related Bank]. The
assignment provided for herein shall be without recourse to the Assignor [and
its Related Bank].
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them.(4) It is
understood that facility fees accrued to the date hereof are for the account of
the Assignor and such fees accruing from and including the date hereof with
respect to the Assigned Amount are for the account of the Assignee. Each of the
Assignor and the Assignee hereby agrees that if it receives any amount under the
Credit Agreement which is for the account of the other party hereto, it shall
receive the same for the account of such other party to the extent of such other
party's interest therein and shall promptly pay the same to such other party.
[SECTION 4. Consent of the Company, BetzDearborn Canada and the
Administrative Agents. This Agreement is conditioned upon the consent of the
Company, BetzDearborn Canada, the General Administrative Agent and the Canadian
Administrative Agent pursuant to Section 11.06 of the Credit Agreement. The
execution of this Agreement by the Company, BetzDearborn Canada, the General
Administrative Agent and the Canadian Administrative Agent is evidence of this
consent. Pursuant to Section 11.06(c), each of the Company and BetzDearborn
Canada agrees to execute and deliver a Note and to cause each of the other
Eligible Subsidiaries to execute and deliver a Note payable to the order of the
Assignee to evidence the assignment and assumption provided for herein.](5)
SECTION 5. Non-Reliance on Assignor[s]. [Neither] The Assignor [nor the
Assignor's Related Bank] makes [no][any] representation or warranty in
connection with, and shall have no responsibility with respect to, the solvency,
financial condition, or statements of any Borrower, or the validity and
enforceability of the obligations of any Borrower in respect of the Credit
Agreement or any Note. [Each of] the Assignee [and the Assignee's Related Bank]
acknowledges that it has, independently and without reliance on the Assignor
[or the Assignor's Related Bank], and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement and will continue to be responsible for
--------
(4) Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee, net of any portion of
any upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula rather
than as a fixed sum.
(5) Not necessary if the Assignee is a Bank.
3
making its own independent appraisal of the business, affairs and financial
condition of the Borrowers.
SECTION 6. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
4
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date first above
written.
(less than)NAME OF ASSIGNOR(greater than)
By
--------------------------------------
Name:
Title:
(less than)NAME OF ASSIGNEE(greater than)
By
--------------------------------------
Name:
Title:
(less than)[NAME OF ASSIGNOR'S RELATED
BANK](greater than)
By
--------------------------------------
Name:
Title:
(less than)[NAME OF ASSIGNEE'S RELATED
BANK](greater than)
By
--------------------------------------
Name:
Title:
[BETZDEARBORN INC.
By
--------------------------------------
Name:
Title:
5
BETZDEARBORN CANADA INC.
By
--------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as General Administrative Agent
By
--------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK
OF CANADA, as Canadian
Administrative Agent]
By
--------------------------------------
Name:
Title:
6
EXHIBIT L - Commitment
Schedule
---------------------------------------------------------------------
US Bank US Commitment
---------------------------------------------------------------------
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK $ 31,000,000
---------------------------------------------------------------------
BANK OF AMERICA NATIONAL $ 31,000,000
TRUST AND SAVINGS ASSOCIATION
---------------------------------------------------------------------
THE CHASE MANHATTAN BANK $ 31,000,000
---------------------------------------------------------------------
BANK OF MONTREAL $ 1,000,000
---------------------------------------------------------------------
COMMERZBANK AG $ 51,000,000
NEW YORK BRANCH
---------------------------------------------------------------------
CORESTATES BANK, N.A. $ 51,000,000
---------------------------------------------------------------------
DEUTSCHE BANK AG, NEW YORK $ 31,000,000
AND/OR CAYMAN ISLANDS BRANCHES
---------------------------------------------------------------------
THE FIRST NATIONAL BANK OF CHICAGO $ 31,000,000
---------------------------------------------------------------------
PNC BANK, NATIONAL ASSOCIATION $ 51,000,000
---------------------------------------------------------------------
ROYAL BANK OF CANADA $ 1,000,000
---------------------------------------------------------------------
BANCA COMMERCIALE ITALIANA $ 10,000,000
NEW YORK BRANCH
---------------------------------------------------------------------
THE BANK OF NEW YORK $ 30,000,000
---------------------------------------------------------------------
BANK OF TOKYO-MITSUBISHI TRUST COMPANY $ 30,000,000
---------------------------------------------------------------------
ISTITUTO BANCARIO SAN PAOLO DI TORINO, SPA $ 30,000,000
---------------------------------------------------------------------
KREDIETBANK, N.V. $ 30,000,000
---------------------------------------------------------------------
SOCIETE GENERALE, NEW YORK BRANCH $ 30,000,000
---------------------------------------------------------------------
THE SUMITOMO BANK, LIMITED, NEW YORK BRANCH $ 30,000,000
---------------------------------------------------------------------
Total......................................... $ 500,000,000
---------------------------------------------------------------------
---------------------------------------------------------------------
Canadian
Canadian Bank Commitment
---------------------------------------------------------------------
▇.▇. ▇▇▇▇▇▇ CANADA $ 30,000,000
---------------------------------------------------------------------
BANK OF AMERICA CANADA $ 30,000,000
---------------------------------------------------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇ $ 30,000,000
---------------------------------------------------------------------
BANK OF MONTREAL $ 50,000,000
---------------------------------------------------------------------
DEUTSCHE BANK CANADA $ 20,000,000
---------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ $ 20,000,000
---------------------------------------------------------------------
ROYAL BANK OF CANADA $ 50,000,000
---------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ $ 20,000,000
---------------------------------------------------------------------
Total......................................... $250,000,000
---------------------------------------------------------------------
2
EXHIBIT M - Form of Acceptance
Note
FORM OF ACCEPTANCE NOTE
C$___________
Toronto, Ontario
-------------, -----
FOR VALUE RECEIVED, the undersigned, [insert name of borrower], a
_____________ corporation (the "Borrower"), hereby unconditionally promises to
pay to the order of [insert name of bank] (the "Bank") at the office of ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇, located at ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇, in lawful money
of Canada and in immediately available funds, the principal amount of
[____________] CANADIAN DOLLARS (C$__________). The undiscounted principal
amount hereof shall be repaid on __________, _____(1). The Borrower further
agrees that interest shall be paid hereon, in advance, by the Bank discounting
the face amount of this Acceptance Note in the manner referred to in Sections
2.03(b)(ix) and 2.03(f) of the Credit Agreement described below (capitalized
terms used herein without definition being defined as set forth therein) as BA
Discount Proceeds.
This Acceptance Note (a) is one of the Acceptance Notes referred to in the
Credit Agreement dated as of October 20, 1997, among BetzDearborn Inc.,
BetzDearborn Canada Inc., the Bank parties thereto, The Chase Manhattan Bank and
The Chase Manhattan Bank of Canada, as Administrative Agents (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement")
and (b) is subject to the provisions of the Credit Agreement.
--------
(1) Insert maturity date for Bankers' Acceptances created simultaneously
herewith.
All parties now and hereafter liable with respect to this Note, whether
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
[NAME OF BORROWER]
By:
-------------------------------
Name:
Title: