Exhibit 10.1
EXECUTION COPY
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CREDIT AGREEMENT
dated as of
May 13, 2002
among
SEAGATE TECHNOLOGY HOLDINGS,
SEAGATE TECHNOLOGY HDD HOLDINGS,
as Cayman Borrower,
SEAGATE TECHNOLOGY (US) HOLDINGS, INC.,
as U.S. Borrower,
The Lenders Party Hereto
and
JPMORGAN CHASE BANK,
as Administrative Agent
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▇.▇. ▇▇▇▇▇▇ SECURITIES INC.,
as Joint Bookrunner and Co-Lead Arranger
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.,
as Syndication Agent, Joint Bookrunner
and Co-Lead Arranger
CITICORP USA, INC.,
as Documentation Agent
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION,
as Documentation Agent
CREDIT SUISSE FIRST BOSTON
as Documentation Agent
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TABLE OF CONTENTS
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ARTICLE I
Definitions
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SECTION 1.01. Defined Terms......................................................1
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SECTION 1.02. Classification of Loans and Borrowings............................48
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SECTION 1.03. Terms Generally...................................................48
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SECTION 1.04. Accounting Terms; GAAP............................................48
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SECTION 1.05. Exchange Rates....................................................49
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ARTICLE II
The Credits
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SECTION 2.01. Commitments.......................................................49
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SECTION 2.02. Loans and Borrowings..............................................50
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SECTION 2.03. Requests for Borrowings...........................................51
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SECTION 2.04. Swingline Loans...................................................52
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SECTION 2.05. Letters of Credit.................................................54
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SECTION 2.06. Funding of Borrowings.............................................62
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SECTION 2.07. Interest Elections................................................63
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SECTION 2.08. Termination and Reduction of Commitments..........................65
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SECTION 2.09. Repayment of Loans; Evidence of Debt..............................65
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SECTION 2.10. Amortization of Term Loans........................................67
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SECTION 2.11. Prepayment of Loans...............................................68
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SECTION 2.12. Fees..............................................................70
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SECTION 2.13. Interest..........................................................72
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SECTION 2.14. Alternate Rate of Interest........................................73
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SECTION 2.15. Increased Costs...................................................74
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SECTION 2.16. Break Funding Payments............................................75
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SECTION 2.17. Taxes.............................................................76
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SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.......78
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SECTION 2.19. Mitigation Obligations; Replacement of Lenders....................80
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SECTION 2.20. Change in Law.....................................................82
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ARTICLE III
Representations and Warranties
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SECTION 3.01. Organization; Powers..............................................82
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SECTION 3.02. Authorization; Enforceability.....................................82
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SECTION 3.03. Governmental Approvals; No Conflicts..............................83
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SECTION 3.04. Financial Condition; No Material Adverse Change...................83
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SECTION 3.05. Properties........................................................85
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SECTION 3.06. Litigation and Environmental Matters..............................85
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SECTION 3.07. Compliance with Laws and Agreements...............................86
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SECTION 3.08. Investment and Holding Company Status.............................86
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SECTION 3.09. Taxes.............................................................86
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SECTION 3.10. ERISA.............................................................87
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SECTION 3.11. Disclosure........................................................87
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SECTION 3.12. Subsidiaries......................................................88
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SECTION 3.13. Insurance.........................................................88
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SECTION 3.14. Labor Matters.....................................................88
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SECTION 3.15. Solvency..........................................................88
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SECTION 3.16. Senior Indebtedness...............................................89
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ARTICLE IV
Conditions
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SECTION 4.01. Effective Date....................................................89
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SECTION 4.02. Each Credit Event.................................................93
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ARTICLE V
Affirmative Covenants
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SECTION 5.01. Financial Statements and Other Information........................94
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SECTION 5.02. Notices of Material Events........................................97
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SECTION 5.03. Information Regarding Collateral..................................98
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SECTION 5.04. Existence; Conduct of Business....................................99
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SECTION 5.05. Payment of Obligations............................................99
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SECTION 5.06. Maintenance of Properties.........................................99
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SECTION 5.07. Insurance........................................................100
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SECTION 5.08. Casualty and Condemnation........................................100
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SECTION 5.09. Books and Records; Inspection and Audit Rights...................100
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SECTION 5.10. Compliance with Laws.............................................100
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SECTION 5.11. Use of Proceeds and Letters of Credit............................101
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SECTION 5.12. Additional Subsidiaries..........................................101
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SECTION 5.13. Further Assurances...............................................102
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ARTICLE VI
Negative Covenants
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SECTION 6.01. Indebtedness; Certain Equity Securities..........................103
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SECTION 6.02. Liens............................................................107
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SECTION 6.03. Fundamental Changes..............................................109
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SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions........110
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SECTION 6.05. Asset Sales......................................................114
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SECTION 6.06. Sale and Leaseback Transactions..................................118
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SECTION 6.07. Swap Agreements..................................................118
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SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness............119
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SECTION 6.09. Transactions with Affiliates.....................................124
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SECTION 6.10. Restrictive Agreements...........................................125
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SECTION 6.11. Amendment of Material Documents..................................126
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SECTION 6.12. Interest Expense Coverage Ratio..................................127
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SECTION 6.13. Fixed Charge Coverage Ratio......................................127
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SECTION 6.14. Net Leverage Ratio...............................................127
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ARTICLE VII
Events of Default
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SECTION 7.01. Events of Default................................................128
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SECTION 7.02. Exclusion of Immaterial Subsidiaries.............................132
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ARTICLE VIII
The Administrative Agent
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SECTION 8.01. The Administrative Agent.........................................132
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ARTICLE IX
Miscellaneous
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SECTION 9.01. Notices..........................................................135
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SECTION 9.02. Waivers; Amendments..............................................136
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SECTION 9.03. Expenses; Indemnity; Damage Waiver...............................138
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SECTION 9.04. Successors and Assigns...........................................141
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SECTION 9.05. Survival.........................................................146
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SECTION 9.06. Counterparts; Integration; Effectiveness.........................147
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SECTION 9.07. Severability.....................................................147
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SECTION 9.08. Right of Setoff..................................................148
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SECTION 9.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.......148
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SECTION 9.10. WAIVER OF JURY TRIAL.............................................149
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SECTION 9.11. Headings.........................................................149
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SECTION 9.12. Confidentiality..................................................149
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SECTION 9.13. Interest Rate Limitation.........................................150
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SECTION 9.14. Judgment Currency................................................151
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SECTION 9.15. Joint and Several Liability......................................152
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ARTICLE X
Collection Allocation Mechanism
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SECTION 10.01. Implementation of CAM...........................................152
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SECTION 10.02. Letters of Credit...............................................153
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SCHEDULES:
Schedule 1.01(a) -- Mortgaged Properties
Schedule 1.01(b) -- Foreign Subsidiaries of the U.S. Borrower
Schedule 1.01(c) -- Moribund Subsidiaries
Schedule 1.02 -- Jurisdictions of Core Loan Parties
Schedule 2.01 -- Commitments
Schedule 2.05(a) -- Existing Letters of Credit
Schedule 2.05(b) -- Outside Letters of Credit
Schedule 3.05(c) -- Real Property
Schedule 3.06 -- Disclosed Matters
Schedule 3.12 -- Subsidiaries
Schedule 3.13 -- Insurance
Schedule 5.01 -- Financial Information of Cayman Borrower
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Page
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Schedule 6.04 -- Existing Investments
Schedule 6.10 -- Existing Restrictions
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B-1
(A)-(B) -- Forms of Opinion of Borrowers' United
States Counsel
Exhibit B-2 -- Form of Opinion of Borrowers' Cayman
Islands Counsel
Exhibit B-3 -- Form of Opinion of Borrowers' Singapore
Counsel
Exhibit B-4 -- Form of Opinion of Borrowers' Northern
Ireland Counsel
Exhibit B-5 -- Form of Opinion of Borrower's Netherlands
Counsel
Exhibit B-6 -- Form of Opinion of United States Local
Counsel
Exhibit B-7 -- Form of Opinion of Administrative Agent's
Thai Counsel
Exhibit B-8 -- Form of Opinion of Borrower's Japan
Counsel
Exhibit B-9 -- Form of Opinion of Borrower's Mexico
Counsel
Exhibit B-10 -- Form of Opinion of Administrative Agent's
U.K. Counsel
Exhibit B-11 -- Form of Opinion of Borrower's Thai Counsel
Exhibit C-1 -- Form of U.S. Security Agreement
Exhibit C-2 -- Form of Cayman Security Agreement
Exhibit C-3 -- Form of Singapore Security Agreement
Exhibit C-4 -- Form of Northern Ireland Security
Agreement
Exhibit C-5 -- Form of Netherlands Security Agreement
Exhibit D-1 -- Form of U.S. Pledge Agreement
Exhibit D-2 -- Form of Cayman Pledge Agreement
Exhibit D-3 -- Form of Singapore Pledge Agreement
Exhibit E -- Form of Indemnity, Subrogation and
Contribution Agreement
Exhibit F -- Form of U.S. Guarantee Agreement
Exhibit G -- Form of U.K. Security Agreement
1
CREDIT AGREEMENT dated as of May 13, 2002, among SEAGATE
TECHNOLOGY HOLDINGS, an exempted limited liability company
organized under the laws of the Cayman Islands ("Intermediate
Holdings"), SEAGATE TECHNOLOGY HDD HOLDINGS, an exempted limited
liability company organized under the laws of the Cayman Islands
(the "Cayman Borrower"), SEAGATE TECHNOLOGY (US) HOLDINGS, INC.,
a Delaware corporation (the "U.S. Borrower"), the LENDERS party
hereto and JPMORGAN CHASE BANK, as Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
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SECTION 1.01. Defined Terms. As used in this Agreement, the following
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terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Alternate Base Rate.
"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing
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for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.
"Administrative Agent" means JPMorgan Chase Bank, in its capacity as
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administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
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in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another Person
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that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
Notwithstanding the foregoing, no individual shall be deemed to be an Affiliate
of a Person solely by reason of his or her being an officer or director of such
Person.
2
"Alternate Base Rate" means, for any day, a rate per annum equal to
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the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"Alternative Currency" means any currency that is freely available,
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freely transferable and freely convertible into dollars and in which dealings in
deposits are carried on in the New York, London or Tokyo interbank markets,
provided that such currency is reasonably acceptable to the Administrative Agent
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and the applicable Issuing Bank.
"Alternative Currency LC Exposure" means, at any time, the sum of (a)
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the Dollar Equivalent of the aggregate undrawn and unexpired amount of all
outstanding Alternative Currency Letters of Credit at such time plus (b) the
Dollar Equivalent of the aggregate principal amount of all LC Disbursements in
respect of Alternative Currency Letters of Credit that have not yet been
reimbursed at such time.
"Alternative Currency Letter of Credit" means a Letter of Credit
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denominated in an Alternative Currency.
"Applicable Margin" means, for any day with respect to (a) any ABR
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Loan or Eurodollar Loan that is a Term Loan, (b) any ABR Loan or Eurodollar Loan
that is a Revolving Loan or (c) the commitment fees payable hereunder, as the
case may be, the applicable margin per annum set forth below under the caption
"Revolving Loan ABR Spread", "Revolving Loan Eurodollar Spread", "Term Loan ABR
Spread," "Term Loan Eurodollar Spread" or "Commitment Fee Rate", as the case may
be, based upon the Leverage Ratio as of the most recent determination date,
provided that until the delivery to the Administrative Agent, pursuant to
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Section 5.01(b), of the Cayman Borrower's consolidated financial information for
the Cayman Borrower's first fiscal quarter ending after the Effective Date, the
"Applicable Margin" for purposes of clauses (a) and (b) above shall be
3
the applicable margin per annum set forth below in Category 2:
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Revolving
Revolving Loan Term Loan
Loan Eurodollar Term Loan Eurodollar Commitment
Leverage Ratio: ABR Spread Spread ABR Spread Spread Fee Rate
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Category 1
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Equal to or greater
than 1.00 to 1.00 1.25% 2.25% 1.25% 2.25% 0.50%
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Category 2
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Less than 1.00 to
1.00 but equal to
or greater than
0.50 to 1.00 1.00% 2.00% 1.00% 2.00% 0.50%
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Category 3
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Less than 0.50 to
1.00 but equal to
or greater than
0.25 to 1.00 0.75% 1.75% 1.00% 2.00% 0.50%
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Category 4
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Less than 0.25 to
1.00 0.50% 1.50% 1.00% 2.00% 0.50%
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For purposes of the foregoing, (a) the Leverage Ratio shall be
determined as of the end of each fiscal quarter of the Cayman Borrower's fiscal
year based upon the Cayman Borrower's consolidated financial information
delivered pursuant to Section 5.01(a) or (b) and (b) each change in the
Applicable Margin resulting from a change in the Leverage Ratio shall be
effective during the period commencing on and including the first Business Day
after the date of delivery to the Administrative Agent of such consolidated
financial information indicating such change and ending on the date immediately
preceding the effective date of the next such change, provided that the Leverage
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Ratio shall be deemed to be in Category 1 (i) at any time that an Event of
Default has occurred and is continuing or (ii) at the option of the
Administrative Agent or at the request of the Required Lenders if Intermediate
Holdings (or, if Intermediate Holdings is no longer a Loan Party, the Cayman
Borrower) fails to deliver the consolidated financial information required to be
delivered by it pursuant to Section 5.01(a) or (b), during the period from the
expiration of the time for delivery thereof until such consolidated financial
information is delivered.
"Applicable Percentage" means, with respect to any Revolving Lender,
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the percentage of the total Revolving Commitments represented by such Lender's
Revolving Commitment. If the Revolving Commitments have terminated or
4
expired, the Applicable Percentages shall be determined based upon the Revolving
Commitments most recently in effect, giving effect to any assignments.
"Assignment and Acceptance" means an assignment and acceptance entered
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into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"Board" means the Board of Governors of the Federal Reserve System of
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the United States of America.
"Borrowing" means (a) Loans of the same Class and Type, made,
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converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect, or (b) a Swingline Loan.
"Borrowing Request" means a request by the Cayman Borrower or the U.S.
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Borrower for a Borrowing in accordance with Section 2.03.
"Borrowers" means the Cayman Borrower and the U.S. Borrower.
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"Business Day" means any day that is not a Saturday, Sunday or other
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day on which commercial banks in New York City are authorized or required by law
to remain closed, provided that, when used in connection with a Eurodollar Loan,
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the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Calculation Date" means (a) the last Business Day of each calendar
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month and (b) if on the last Business Day of any calendar week the total
Revolving Exposures exceed 75% of the total Revolving Commitments (giving effect
to any reductions in the Revolving Commitments scheduled to occur on such day),
such Business Day.
"CAM" shall mean the mechanism for the allocation and exchange of
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interests in the Loans, participations in Letters of Credit and collections
thereunder established under Article X.
"CAM Exchange" shall mean the exchange of the Lenders' interests
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provided for in Section 10.01.
"CAM Exchange Date" shall mean the first date after the Effective Date
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on which there shall occur (a) any
5
event described in paragraph (h) or (i) of Section 7.01 with respect to either
Borrower or (b) an acceleration of the maturity of Loans pursuant to Section
7.01.
"CAM Percentage" shall mean, as to each Lender, a fraction, expressed
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as a decimal, of which (a) the numerator shall be the sum of (i) the aggregate
Obligations owed to such Lender, (ii) the LC Exposure, if any, of such Lender,
and (iii) the Swingline Exposure, if any, of such Lender, in each case
immediately prior to the CAM Exchange Date, and (b) the denominator shall be the
sum of (i) the aggregate Obligations owed to all the Lenders and (ii) the
aggregate LC Exposure of all the Lenders, in each case immediately prior to the
CAM Exchange Date; provided that, for purposes of clause (a) above, the
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Obligations owed to the Swingline Lender will be deemed not to include any
Swingline Loans except to the extent provided in clause (a)(iii) above.
"Capital Expenditures" means, for any period, without duplication, (a)
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the additions to property, plant and equipment and other capital expenditures of
the Cayman Borrower and its consolidated subsidiaries that are (or would be) set
forth in a consolidated statement of cash flows of the Cayman Borrower for such
period prepared in accordance with GAAP and (b) Capital Lease Obligations
incurred by the Cayman Borrower and its consolidated subsidiaries during such
period, provided that the term "Capital Expenditures" (i) shall be net of
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landlord construction allowances, (ii) shall not include expenditures to the
extent they are made with the proceeds of the issuance of Equity Interests of
Intermediate Holdings, the Cayman Borrower, the U.S. Borrower or any Subsidiary
after the Effective Date, (iii) shall not include expenditures of proceeds of
insurance settlements, condemnation awards and other settlements in respect of
lost, destroyed, damaged or condemned assets, equipment or other property to the
extent such expenditures are made to replace or repair such lost, destroyed,
damaged or condemned assets, equipment or other property or otherwise to acquire
properties useful in the business of either Borrower or any of the Subsidiaries
within 365 days of receipt of such proceeds, and (iv) shall not include the
purchase price of equipment to the extent the consideration therefor consists of
used or surplus equipment being traded in at such time or the proceeds of a
concurrent sale of such used or surplus equipment, in each case in the ordinary
course of business. For the purpose of calculating Capital Expenditures any
amounts expended in respect of an acquisition or other investment that is made
pursuant to Section 6.04 (q) shall be deemed not to constitute Capital
Expenditures to the extent such amounts reduce the available amount under
Section 6.04(q).
6
"Capital Lease Obligations" of any Person means the obligations of
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such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Cash Amount" means, as of any date, the average amount of cash and
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the carrying value of Permitted Investments that would be reflected as cash or
short term investments on a consolidated balance sheet of the Cayman Borrower in
accordance with GAAP, held by the Cayman Borrower and its consolidated
subsidiaries at the close of business during the five Business Day period
preceding such date.
"Cash From Operations" means, as of any date, the amount of cash and
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the carrying value of Permitted Investments that would be reflected as cash or
short term investments on a consolidated balance sheet of the Cayman Borrower in
accordance with GAAP, held by the Cayman Borrower and its consolidated
subsidiaries at the close of business on the preceding Business Day less (a) the
Net Proceeds received by the Cayman Borrower and its consolidated subsidiaries
during the period from the Effective Date to and including such date in respect
of asset sales (to the extent such Net Proceeds are not previously reinvested in
real property, equipment or other assets to be used in the business of the
Cayman Borrower or the Subsidiaries) and (b) the aggregate amount by which
Indebtedness of the Cayman Borrower and its consolidated subsidiaries increased
during the period from the Effective Date to and including such date.
"Cayman Borrower" means Seagate Technology HDD Holdings, an exempted
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limited liability company existing and organized under the laws of the Cayman
Islands.
"Cayman Pledge Agreements" means the Share Mortgages, dated as of the
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Effective Date, substantially in the form of Exhibit D-2, between each Loan
Party that owns Equity Interests of any Person organized under the laws of the
Cayman Islands that would constitute Collateral if such Loan Party executed a
Cayman Pledge Agreement and the Collateral Agent for the benefit of the Secured
Parties.
"Cayman Security Agreements" means the Deeds of Charge, dated as of
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the Effective Date, substantially in the
7
form of Exhibit C-2, between each Loan Party that is incorporated or organized
under the laws of the Cayman Islands or that owns Collateral located in the
Cayman Islands and the Collateral Agent for the benefit of the Secured Parties.
"Cayman Term Loan" means a Loan made pursuant to clause (a) of Section
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2.01.
"CERCLA" means the Comprehensive Environmental Response, Compensation,
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and Liability Act, 42 U.S.C.(S). 9601 et seq.
"Change in Control" means:
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(a) the acquisition of direct ownership, beneficially or of record, by any
Person other than the Cayman Borrower of any Equity Interest in the U.S.
Borrower;
(b) prior to an IPO of the Cayman Borrower, the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person other than
Intermediate Holdings (or, following the distribution of all the Equity
Interests in the Cayman Borrower by Intermediate Holdings to Holdings (i) in
connection with an IPO of the Cayman Borrower or (ii) following the sale,
transfer, liquidation or other disposition of SAN Holdings and its subsidiaries
by Intermediate Holdings, Holdings) of any Equity Interest in the Cayman
Borrower (other than the acquisition of Equity Interests in the Cayman Borrower
by Permitted Optionholders pursuant to the exercise of Permitted Options);
(c) prior to an IPO of the Cayman Borrower or Intermediate Holdings, the
failure by the Permitted Holders collectively to own (and retain the right to
vote) directly or indirectly, beneficially and of record, Equity Interests in
the Cayman Borrower representing more than 50% of the aggregate ordinary voting
power and aggregate equity value represented by the issued and outstanding
Equity Interests in Intermediate Holdings;
(d) after an IPO of the Cayman Borrower or Intermediate Holdings, the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the Securities Exchange Act of 1934
and the rules of the Securities and Exchange Commission thereunder as in effect
on the date hereof), of Equity Interests in the Cayman Borrower representing
greater than 30% of the aggregate ordinary voting power and aggregate equity
value represented by the issued and outstanding
8
Equity Interests in the Cayman Borrower unless the Permitted Holders
collectively own, directly or indirectly, Equity Interests representing more
than 45% of the aggregate ordinary voting power and aggregate equity value
represented by the issued and outstanding Equity Interests in the Cayman
Borrower;
(e) occupation of a majority of the seats (other than vacant seats) on the
board of directors of the Cayman Borrower or Intermediate Holdings by Persons
who were neither (i) nominated by at least a majority of the board of directors
of the Cayman Borrower or Intermediate Holdings, as applicable, nor (ii)
appointed by a vote of a majority of directors so nominated; or
(f) the occurrence of a "Change in Control" as defined in the Senior Note
Documents.
"Change in Law" means (a) the adoption of any law, rule or regulation
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after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.15(b), by any lending office of such Lender
or by such Lender's or the Issuing Bank's holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers to
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whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans,
Term Loans or Swingline Loans and, when used in reference to any Commitment,
refers to whether such Commitment is a Revolving Commitment, or Term Loan
Commitment.
"Code" means the Internal Revenue Code of 1986, as amended from time
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to time.
"Collateral" means any and all "Collateral", as defined in any
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applicable Security Document.
"Collateral Agent" means the "Collateral Agent", as defined in any
----------------
applicable Security Document.
9
"Collateral and Guarantee Requirement" means the requirement that:
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(a) on the Effective Date (except as provided in Section 4.01(f)), the
Administrative Agent shall have received from each Loan Party a counterpart
of each of (i) the applicable Guarantee Agreement, (ii) in the case of any
Loan Party that executes the U.S. Guarantee Agreement, the Indemnity,
Subrogation and Contribution Agreement, (iii) in the case of any Loan Party
that is a U.S. Loan Party or that owns any Equity Interests in any Person
that is organized under the laws of the United States that would constitute
Collateral if such Loan Party executed the U.S. Pledge Agreement, the U.S.
Pledge Agreement, (iv) in the case of any Loan Party that is a U.S. Loan
Party or that owns any Collateral located in the United States, the U.S.
Security Agreement, (v) in the case of any Loan Party that owns any Equity
Interests in a Person that is incorporated or organized under the laws of
the Cayman Islands and that would constitute Collateral if such Loan Party
executed a Cayman Pledge Agreement, a Cayman Pledge Agreement, (vi) in the
case of any Loan Party that is incorporated or organized under the laws of
the Cayman Islands or owns any Collateral located in the Cayman Islands, a
Cayman Security Agreement, (vii) in the case of any Loan Party that is
organized under the laws of Singapore or that owns any Collateral located
in Singapore, the Singapore Security Agreement, (viii) in the case of any
Loan Party that owns Equity Interests in a Person that is organized under
the laws of Singapore and that would constitute Collateral if such Loan
Party executed a Singapore Pledge Agreement, a Singapore Pledge Agreement,
(ix) in the case of Seagate Technology International, Seagate Technology
Media (Ireland) and Seagate Technology (Ireland), a Northern Ireland
Security Agreement, (x) in the case of STI, the Netherlands Security
Agreement, and (xi) in the case of Seagate Technology (Thailand) Limited,
the Thai Mortgages, in each case duly executed and delivered on behalf of
such Loan Party;
(b) in the case of any Subsidiary created or acquired by either
Borrower or any Subsidiary after the Effective Date that is not a Foreign
Subsidiary, such Subsidiary shall execute and deliver to the Administrative
Agent a supplement to each of the U.S. Guarantee Agreement, the Indemnity,
Subrogation and Contribution Agreement and each applicable Security
Document, in the form specified therein;
10
(c) in the case of any Foreign Subsidiary created or acquired by
either Borrower or any Subsidiary after the Effective Date that (i) is
organized under the laws of Singapore, (ii) on the date on which such
Foreign Subsidiary is created or acquired, would, on a pro forma basis
after giving effect to such creation or acquisition and any related
transfers of assets to such Foreign Subsidiary, (A) hold at least 10% of
the Consolidated Total Assets reflected in the Cayman Borrower's
consolidated financial information (as adjusted to give effect to such
creation or acquisition) as of the last day of the most recently ended
fiscal quarter for which a balance sheet has been delivered to the
Administrative Agent pursuant to Section 5.01(a) or (b) or (B) account for
at least 10% of Consolidated EBITDA for the four fiscal quarter period
ended on such day as reflected in the certificate for such period (as
adjusted to give effect to such creation or acquisition) delivered to the
Administrative Agent pursuant to Section 5.01(c) or (iii) at the end of any
fiscal quarter after the date on which such Foreign Subsidiary is created
or acquired (A) holds at least 10% of Consolidated Total Assets as
reflected in the Cayman Borrower's consolidated financial information (as
adjusted to give effect to such creation or acquisition) for such date
delivered to the Administrative Agent pursuant to Section 5.01(a) or (b) or
(B) accounts for at least 10% of Consolidated EBITDA for the four fiscal
quarter period ended on such date as reflected in the certificate for such
period (as adjusted to give effect to such creation or acquisition)
delivered to the Administrative Agent pursuant to Section 5.01(c), such
Foreign Subsidiary (if not organized under the laws of Malaysia or any
other jurisdiction in which applicable law would prevent such entity from
lawfully complying with the provisions of this clause (c)) shall execute
and deliver to the Administrative Agent (x) a supplement to or a
counterpart of the applicable Guarantee Agreement, (y) if such Foreign
Subsidiary executes the U.S. Guarantee Agreement, a supplement to the
Indemnity, Subrogation and Contribution Agreement and (z) a counterpart of
one or more security or pledge agreements or similar documents or
instruments, which (as applicable) may include a Singapore Security
Agreement, a Singapore Pledge Agreement or a Northern Ireland Security
Agreement on terms substantially similar to those contained in the U.S.
Pledge Agreement (collectively, a "Foreign Security Agreement"), that (1)
create perfected Liens on substantially all tangible and intangible assets
11
(including Equity Interests in other Subsidiaries of such Foreign
Subsidiary), other than assets that the Administrative Agent has made a
determination to exclude, prior to any other Lien on any of such assets
(other than Liens expressly permitted to be prior to the Liens created by
such a Foreign Security Agreement pursuant to Section 6.02), (2) provide
rights and benefits to the Collateral Agent and the other Secured Parties
with respect to such assets substantially identical to the rights and
benefits provided by the U.S. Security Agreement and the U.S. Pledge
Agreement (except as prohibited by applicable law) and (3) are otherwise in
form and substance reasonably satisfactory to the Administrative Agent, in
each case duly executed and delivered on behalf of such Loan Party;
(d) in the case of a Foreign Subsidiary created or acquired by either
Borrower or any Subsidiary after the Effective Date to which the preceding
clause (c) does not apply and that the Cayman Borrower designates as a
Subsidiary Loan Party, such Foreign Subsidiary shall execute and deliver to
the Administrative Agent a supplement to or counterpart of the applicable
Guarantee Agreement, and, if such Foreign Subsidiary executes the U.S.
Guarantee Agreement, a supplement to the Indemnity, Subrogation and
Contribution Agreement (except as prohibited by applicable law);
(e) all outstanding Equity Interests of each Borrower and each
Subsidiary (except that, if such Subsidiary is (i) a Foreign Subsidiary
identified on Schedule 1.01(b) and (ii) a direct or indirect subsidiary of
the U.S. Borrower, shares of common stock of such Subsidiary to be pledged
pursuant to the applicable Pledge Agreement may be limited to 65% of the
outstanding common stock of such Subsidiary) owned directly by or directly
on behalf of any Loan Party that is required hereunder to become party to
any Pledge Agreement or Foreign Security Agreement shall have been pledged
pursuant to the applicable Pledge Agreement (other than any Equity
Interests in Seagate Technology (Ireland Holdings)) and, unless the
Administrative Agent shall otherwise agree (which agreement shall not be
unreasonably withheld), the Administrative Agent shall have received
certificates or other instruments representing all such Equity Interests,
together with stock powers or other instruments of transfer with respect
thereto endorsed in blank;
12
(f) all Indebtedness of Intermediate Holdings (for so long as it is a
Loan Party), each Borrower and each Subsidiary that is owing to any Loan
Party that is required hereunder to become party to a Pledge Agreement or a
Foreign Security Agreement shall be evidenced by a promissory note and
shall have been pledged pursuant to the applicable Pledge Agreement and,
unless the Administrative Agent shall otherwise agree (which agreement
shall not be unreasonably withheld), the Administrative Agent shall have
received all such promissory notes, together with instruments of transfer
with respect thereto endorsed in blank;
(g) all documents and instruments, including Uniform Commercial Code
financing statements, required by law or reasonably requested by the
Administrative Agent to be filed, registered or recorded to (i) create the
Liens intended to be created by the Security Documents and (ii) perfect
such Liens to the extent required by, and with the priority required by,
the applicable Security Document, shall have been filed, registered or
recorded or delivered to the Administrative Agent for filing, registration
or recording;
(h) the Administrative Agent shall have received (i) counterparts of a
Mortgage with respect to each Mortgaged Property duly executed and
delivered by the record owner of such Mortgaged Property, (ii) a policy or
policies of title insurance issued by a nationally recognized title
insurance company insuring the Lien of each such Mortgage in respect of a
Mortgaged Property located in the United States or, if reasonably requested
by the Administrative Agent and available on commercially reasonable terms,
outside the United States as a valid first Lien on the Mortgaged Property
described therein, free of any other Liens except as expressly permitted by
Section 6.02, together with such endorsements, coinsurance and reinsurance
as the Administrative Agent or the Required Lenders may reasonably request,
and (iii) such survey affidavits, legal opinions and other documents as the
Administrative Agent or the Required Lenders may reasonably request with
respect to any such Mortgage or Mortgaged Property; and
(i) each Loan Party shall have obtained all material consents and
approvals required to be obtained by it in connection with the execution
and delivery of all Security Documents to which it is a party, the
13
performance of its obligations thereunder and the granting by it of the
Liens thereunder.
"Commitment" means a Revolving Commitment, Term Loan Commitment, or
----------
any combination thereof (as the context requires).
"Consolidated Cash Interest Expense" means, for any period, the excess
----------------------------------
of (a) the sum of (i) the interest expense (including imputed interest expense
in respect of Capital Lease Obligations) of the Borrowers and the Subsidiaries
for such period, determined on a consolidated basis in accordance with GAAP,
plus (ii) any interest accrued during such period in respect of Indebtedness of
either Borrower or any Subsidiary that is required to be capitalized rather than
included in consolidated interest expense for such period in accordance with
GAAP, plus (iii) any cash payments made during such period in respect of
obligations referred to in clause (b)(ii) below that were amortized or accrued
in a previous period, minus (b) the sum of (i) to the extent included in such
consolidated interest expense for such period, non-cash amounts attributable to
amortization of financing costs paid in a previous period, plus (ii) to the
extent included in such consolidated interest expense for such period, non-cash
amounts attributable to amortization of debt discounts or accrued interest or
dividends payable in kind for such period.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
-------------------
for such period plus (a) without duplication and to the extent deducted in
----
determining such Consolidated Net Income, the sum of (i) consolidated interest
expense for such period, (ii) consolidated income tax expense for such period,
(iii) all amounts attributable to depreciation and amortization for such period,
(iv) all extraordinary charges during such period, (v) noncash expenses during
such period resulting from (A) the grant of stock or stock options to management
and employees of either Borrower or any of the Subsidiaries or (B) the treatment
of such options under variable plan accounting, (vi) the aggregate amount of
deferred financing expenses for such period, (vii) all other noncash charges,
noncash expenses or noncash losses of either Borrower or any of the Subsidiaries
for such period (excluding any such charge, expense or loss incurred in the
ordinary course of business that constitutes an accrual of or a reserve for cash
charges for any future period), provided, however, that cash payments made in
-------- -------
such period or in any future period (other than payments made under the terms of
the Deferred Compensation Plans to, or for the benefit of, participants in such
Deferred Compensation Plans) in respect of such noncash charges,
14
expenses or losses (excluding any such charge, expense or loss incurred in the
ordinary course of business that constitutes an accrual of or a reserve for cash
charges for any future period) shall be subtracted from Consolidated Net Income
in calculating Consolidated EBITDA in the period when such payments are made,
(viii) any non-recurring fees, expenses or charges realized by either Borrower
or any of the Subsidiaries for such period related to any offering of Equity
Interests or incurrence of Indebtedness permitted to be issued or incurred under
Section 6.01 (whether or not successful) and fees, expenses and charges related
to the Transactions and (ix) any charges for the portion of such period ended on
or before June 27, 2003, that are associated with the restructuring of the
manufacturing operations of the U.S. Borrower, STI and the Subsidiaries,
provided that such charges shall not be in excess of $126,200,000 for the period
--------
of three fiscal years ending June 27, 2003, and minus (b) without duplication
-----
and to the extent included in determining such Consolidated Net Income, (i) any
extraordinary gains for such period, (ii) interest income for such period and
(iii) all noncash items increasing Consolidated Net Income for such period
(excluding any items that represent the reversal of any accrual of, or cash
reserve for, anticipated cash charges in any prior period that are described in
the parenthetical to clause (a)(vii) above), all determined on a consolidated
basis in accordance with GAAP. For purposes of calculating Consolidated EBITDA
for any period, any payment made or received by either Borrower or any of the
Subsidiaries pursuant to the Indemnification Agreement (any such payment, an
"Indemnification Payment") shall be treated in the manner in which the loss,
cost, expense or payment that gave rise to such Indemnification Payment (the
"Underlying Payment") would have been treated if such Underlying Payment had
------------------
been made or received, as applicable, directly by or to the Borrowers or any of
the Subsidiaries. For purposes of calculating the Leverage Ratio or the Net
Leverage Ratio or the Fixed Charge Coverage Ratio as of any date, if either
Borrower or any consolidated Subsidiary has made any material Permitted
Acquisition or material sale, transfer, lease or other disposition of assets
outside of the ordinary course of business permitted by Section 6.05 during the
period of four consecutive fiscal quarters ending on the date on which the most
recent fiscal quarter ended, Consolidated EBITDA for the relevant period for
testing compliance shall be calculated after giving pro forma effect thereto, as
if such Permitted Acquisition or sale, transfer, lease or other disposition of
assets outside of the ordinary course of business (and any related incurrence,
repayment or assumption of Indebtedness with any new Indebtedness being deemed
to be amortized over the applicable testing period in
15
accordance with its terms) had occurred on the first day of the relevant period
for testing compliance. Any pro forma calculations pursuant to the immediately
preceding sentence shall be determined in good faith by a Financial Officer of
the Cayman Borrower and may include adjustments (a) for all purposes under this
Agreement, for operating expense reductions that would be permitted pursuant to
Article XI of Regulation S-X under the Securities Act of 1933 or (b) for all
purposes under this Agreement other than for purposes of determining whether any
acquisition complies with clause (d) of the definition of the term Permitted
Acquisition, to eliminate the actual, historical operating expenses attributable
to any lease or other contract, any personnel or any facility as a direct result
of the termination of such lease or other contract, the termination of such
personnel or the closing of such facility, in each case only if such termination
or closing has been effected within three months after a Permitted Acquisition
in connection with such Permitted Acquisition, provided that the Cayman
--------
Borrower's calculation of such adjustments is set forth in a certificate signed
by a Financial Officer of the Cayman Borrower.
"Consolidated Fixed Charges" means, for any period, the sum of (a)
--------------------------
Consolidated Cash Interest Expense for such period and (b) Capital Expenditures
for such period. For purposes of calculating compliance with Section 6.13 as of
any date, if either Borrower or any consolidated Subsidiary has made any
material Permitted Acquisition or material sale, transfer, lease or other
disposition of assets outside of the ordinary course of business permitted by
Section 6.05 during the period of four consecutive fiscal quarters ending on the
date on which the most recent fiscal quarter ended, Consolidated Fixed Charges
for the relevant period for testing compliance shall be calculated after giving
pro forma effect thereto, as if such Permitted Acquisition or sale, transfer,
lease or other disposition of assets outside of the ordinary course of business
(and any related incurrence, repayment or assumption of Indebtedness with any
new Indebtedness being deemed to be amortized over the applicable testing period
in accordance with its terms) had occurred on the first day of the relevant
period for testing compliance.
"Consolidated Net Cash Interest Expense" means, for any period, the
--------------------------------------
excess of (a) Consolidated Cash Interest Expense for such period minus (b) cash
interest income of the Borrowers and the Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
16
"Consolidated Net Income" means, for any period, the net income or
-----------------------
loss of the Borrowers and the Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, provided that there shall be
--------
excluded from such net income or loss (a) the income of any Person (that is not
a consolidated Subsidiary) in which any other Person (other than either Borrower
or any consolidated Subsidiary or any director holding qualifying shares in
compliance with applicable law) owns an Equity Interest, except to the extent of
the amount of dividends or other distributions actually paid to either Borrower
or any of the consolidated Subsidiaries by such Person during such period, (b)
the income or loss of any Person accrued prior to the date on which it becomes a
Subsidiary or is merged into or consolidated with either Borrower or any
consolidated Subsidiary or the date on which such Person's assets are acquired
by either Borrower or any consolidated Subsidiary and (c) minority interest
expense attributable to the Cayman Borrower as a result of a Permitted Cayman
Borrower Equity Sale.
"Consolidated Total Assets" means, as of any date, the total assets of
-------------------------
the Borrowers and the Subsidiaries on such date determined on a consolidated
basis in accordance with GAAP.
"Control" means the possession, directly or indirectly, of the power
-------
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
The terms "Controlling" and "Controlled" have meanings correlative thereto.
----------- ----------
"Convertible Securities" has the meaning assigned to such term in the
----------------------
definition of the term Distributable Liquidity Event Proceeds.
"Core Loan Party" means Intermediate Holdings, each Borrower and any
---------------
Subsidiary Loan Party that executes a Guarantee Agreement and is organized under
the laws of (i) the United States of America or any State thereof or the
District of Columbia, (ii) the Cayman Islands, (iii) any jurisdiction listed on
Schedule 1.02 hereto or (iv) any other jurisdiction requested by the Cayman
Borrower in which the Administrative Agent is satisfied that, taking into
account all legal and practical considerations, the Collateral Agent for the
benefit of the Lenders will be able substantially to realize the benefits
intended to be created by such Subsidiary's Guarantee of the Obligations and any
Collateral pledged in connection therewith, provided that any Subsidiary Loan
--------
Party organized under the laws of any
17
jurisdiction other than the United States, the ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ or another jurisdiction in respect of which the Cayman Borrower
has previously complied with the requirement of this proviso shall not be
considered a Core Loan Party unless and until the Cayman Borrower has delivered
to the Administrative Agent an opinion of counsel for such jurisdiction, in form
and substance reasonably satisfactory to the Administrative Agent; provided,
--------
further, that upon the release of the Guarantee by Intermediate Holdings of the
-------
Obligations in accordance with the terms of the U.S. Guarantee Agreement,
Intermediate Holdings shall cease to be a Core Loan Party for all purposes
hereunder. For the avoidance of doubt, any Person organized in any of the
jurisdictions described in clauses (i) through (iv) of the previous sentence
that is not a Loan Party is not a Core Loan Party.
"Debt Tender Materials" means the Offer to Purchase and Consent
---------------------
Solicitation Statement dated April 15, 2002, and the related Consent and Letter
of Transmittal dated April 15, 2002.
"Debt Tender Offer" means the debt tender offer and consent
-----------------
solicitation by STI in respect of the Existing Subordinated Debt pursuant to
which (a) STI will purchase not less than a majority of the aggregate principal
amount of the Existing Subordinated Debt outstanding on the Effective Date and
(b) STI will obtain consents sufficient to amend and, immediately thereafter,
shall amend the indenture governing the Existing Subordinated Debt pursuant to
documentation reasonably satisfactory to the Administrative Agent to eliminate
all significant negative covenants in such indenture, all in accordance with the
Debt Tender Materials.
"Default" means any event or condition that constitutes an Event of
-------
Default or that upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Deferred Compensation Plans" means (i) the deferred compensation plan
---------------------------
dated as of November 22, 2000, of the Cayman Borrower (as amended, waived,
supplemented or otherwise modified from time to time), (ii) any other plan
established in lieu of, or to renew or replace, in whole or in part, any plan
referred to in clause (i) above or this clause (ii) and (iii) any Guarantee by
Intermediate Holdings or any of its subsidiaries of any obligation under any
Deferred Compensation Plan referred to in clause (i) or (ii) above.
18
"Denmark Holdings" means Seagate Technology (Denmark) ApS, an
----------------
anpartsselskab organized under the laws of Denmark.
"Disclosed Matters" means the actions, suits and proceedings and the
-----------------
environmental matters disclosed in Schedule 3.06.
"Distributable Liquidity Event Proceeds" means
--------------------------------------
(a) with respect to a Permitted Cayman Borrower Equity Sale that is an
issuance and sale by the Cayman Borrower of Equity Interests in the Cayman
Borrower pursuant to an IPO of the Cayman Borrower, the Net Proceeds received by
the Cayman Borrower from such Permitted Cayman Borrower Equity Sale;
(b) with respect to a Permitted Cayman Borrower Equity Sale that is an
issuance and sale of Equity Interests in the Cayman Borrower subsequent to an
IPO of the Cayman Borrower pursuant to an offering by the Cayman Borrower, the
Net Proceeds received by the Cayman Borrower from such Permitted Cayman Borrower
Equity Sale.
(c) with respect to (i) a Permitted Intermediate Holdings Equity Sale
that is an issuance and sale by Intermediate Holdings of Equity Interests in
Intermediate Holdings pursuant to an IPO of Intermediate Holdings or (ii) a
Permitted Cayman Borrower Equity Sale that is a sale of Equity Interests in the
Cayman Borrower held by Intermediate Holdings, the Net Proceeds received by
Intermediate Holdings from such Permitted Intermediate Holdings Equity Sale or
Permitted Cayman Borrower Equity Sale (or cash received from the sale of Net
Public Equity Proceeds received from such Permitted Cayman Borrower Equity Sale)
and contributed to the Cayman Borrower; and
(d) with respect to a Permitted Intermediate Holdings Equity Sale that
is an issuance and sale of Equity Interests in Intermediate Holdings subsequent
to an IPO of Intermediate Holdings pursuant to an offering by Intermediate
Holdings, the Net Proceeds received by Intermediate Holdings from such Permitted
Intermediate Holdings Equity Sale and contributed to the Cayman Borrower.
"Documentation Agents" means Citicorp USA, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
Capital Corporation.
"dollars" or "$" refers to lawful money of the United States of
------- -
America.
19
"Dollar Equivalent" means, on any date of determination, (a) for the
-----------------
purposes of determining compliance with Article VI or the existence of an Event
of Default under Article VII, with respect to any amount denominated in a
currency other than dollars, the equivalent in dollars of such amount,
determined in good faith by the Cayman Borrower in a manner consistent with the
way such amount is or would be reflected on the audited consolidated financial
statements delivered pursuant to Section 5.01(a) for the fiscal year in which
such determination is made, and (b) for the purposes of Article II or Article X,
with respect to any amount denominated in an Alternative Currency, the
equivalent in dollars of such amount, determined by the Administrative Agent
pursuant to Section 1.05(a) using the applicable Exchange Rate with respect to
such Alternative Currency.
"Effective Date" means the date on which the conditions specified in
--------------
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"Environmental Laws" means all laws, rules, regulations, codes,
------------------
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating to the environment, preservation or reclamation of natural
resources or the presence, management, Release or threatened Release of any
Hazardous Material.
"Environmental Liability" means any liabilities, obligations, damages,
-----------------------
claims, actions, suits, judgements or orders, contingent or otherwise (including
any costs of environmental remediation, administrative oversight costs, fines,
penalties or indemnities), of Intermediate Holdings (for so long as it is a Loan
Party) , the Borrowers or any Subsidiary resulting from or relating to (a) the
non-compliance with any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the Release or threatened Release of
any Hazardous Materials or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.
"Equity Interests" means shares of capital stock, partnership
----------------
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person.
20
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
---------------
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section
-----------
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by either Borrower or any of its ERISA Affiliates of
any liability under Title IV of ERISA with respect to the termination of any
Plan; (e) the receipt by either Borrower or any ERISA Affiliate from the PBGC or
a plan administrator of any notice relating to an intention to terminate any
Plan or Plans or to appoint a trustee to administer any Plan under Section 4042
of ERISA; (f) the incurrence by either Borrower or any of its ERISA Affiliates
of any liability with respect to the withdrawal or partial withdrawal from any
Plan or Multiemployer Plan; or (g) the receipt by either Borrower or any ERISA
Affiliate of any notice, or the receipt by any Multiemployer Plan from either
Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in reorganization, within the meaning of Title IV
of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing, refers
----------
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
----------------
VII.
"Exchange Rate" means, on any day, with respect to any Alternative
-------------
Currency, the rate at which such Alternative Currency may be exchanged into
dollars, as set forth at approximately 11:00 a.m., New York City time, on such
day on the applicable Reuters World Spot Page. In the event that any such rate
does not appear on any Reuters World Spot
21
Page, the Exchange Rate shall be determined by reference to such other publicly
available service for displaying exchange rates reasonably selected by the
Administrative Agent in consultation with the Cayman Borrower for such purpose
or, at the discretion of the Administrative Agent in consultation with the
Cayman Borrower, such Exchange Rate shall instead be the arithmetic average of
the spot rates of exchange of the Administrative Agent in the market where its
foreign currency exchange operations in respect of such Alternative Currency are
then being conducted, at or about 10:00 a.m., local time, on such day for the
purchase of the applicable Alternative Currency for delivery two Business Days
later, provided that, if at the time of any such determination, for any reason,
--------
no such spot rate is being quoted, the Administrative Agent may use any other
reasonable method it deems appropriate to determine such rate, and such
determination shall be presumed correct absent manifest error.
"Excluded Taxes" means, with respect to the Administrative Agent, any
--------------
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrowers hereunder, (a) doing business,
income or franchise taxes (i) imposed on (or measured by) its net income by the
United States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located or (ii) as
a result of a present or former connection between such recipient and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from such Lender's, Issuing Bank's or any other
recipient's having executed, delivered or performed its obligations or received
a payment under, or enforced, any Loan Document), (b) any branch profits taxes
imposed by the United States of America or any similar tax imposed by any other
jurisdiction described in clause (a) above and (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by the Cayman Borrower
under Section 2.19(b)), any withholding tax (other than a withholding tax levied
upon any amounts payable to such Foreign Lender in respect of any interest in
any Loan acquired by such Foreign Lender pursuant to the CAM Exchange) that (i)
is in effect and would apply to amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party to this Agreement (or designates a new
lending office), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office (or
assignment), to receive additional amounts from a
22
Borrower with respect to any withholding tax pursuant to Section 2.17(a), or
(ii) is attributable to such Foreign Lender's failure to comply with Section
2.17(e).
"Existing Credit Agreement" means the credit agreement dated as of
-------------------------
November 22, 2000 (as amended, restated, modified or otherwise supplemented from
time to time), among Holdings, STI, the U.S. Borrower, the Lenders party
thereto, JPMorgan Chase Bank, as administrative agent and the other parties
thereto.
"Existing Letter of Credit" means each letter of credit previously
-------------------------
issued for the account of, or guaranteed by, either Borrower or a Subsidiary
that (a) is outstanding on the Effective Date and (b) is listed on Schedule
2.05(a).
"Existing Subordinated Debt" means the 12 1/2% Senior Subordinated
--------------------------
Notes due 2007 issued by STI.
"Existing Subordinated Debt Documents" means the indenture under which
------------------------------------
the Existing Subordinated Debt is issued and all other instruments, agreements
and other documents evidencing or governing the Existing Subordinated Debt or
providing for any Guarantee or other right in respect thereof.
"Federal Funds Effective Rate" means, for any day, the weighted
----------------------------
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
-----------------
accounting officer, treasurer or controller of Intermediate Holdings or the
applicable Borrower.
"Fixed Charge Coverage Ratio" has the meaning assigned to such term in
---------------------------
Section 6.13.
"Foreign Lender" means any Lender that is organized under the laws of
--------------
a jurisdiction other than (a) the United States of America, any State thereof or
the District of Columbia or (b) the jurisdiction in which the
23
applicable Borrower is located. For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be
deemed to constitute a single jurisdiction.
"Foreign Security Agreement" has the meaning assigned to such term in
--------------------------
paragraph (c) of the definition of the term "Collateral and Guarantee
Requirement".
"Foreign Subsidiary" means any Subsidiary that is organized under the
------------------
laws of a jurisdiction other than (a) the United States of America or any State
thereof or the District of Columbia or (b) the Cayman Islands.
"Foreign Subsidiary Guarantee Agreement" means an agreement between
--------------------------------------
any Foreign Subsidiary and the Collateral Agent that (x) provides a Guarantee of
the Obligations by such Foreign Subsidiary in favor of, and other rights and
benefits to, the Collateral Agent and the other Secured Parties substantially
identical to the Guarantee of the Obligations and the other rights and benefits
provided by the U.S. Guarantee Agreement (except as prohibited by applicable
law) and (y) is otherwise in form and substance reasonably satisfactory to the
Administrative Agent.
"Funded Indebtedness" means as of any date, (a) the aggregate
-------------------
principal amount of Indebtedness of the Borrowers and the Subsidiaries
outstanding as of such date, in the amount that would be reflected on a balance
sheet prepared as of such date on a consolidated basis in accordance with GAAP,
and (b) without duplication, the aggregate amount of any Guarantee by either
Borrower or any Subsidiary of any such Indebtedness of any other Person.
"GAAP" means generally accepted accounting principles in the United
----
States of America.
"Governmental Authority" means the government of the United States of
----------------------
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any
--------- ---------
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
---------------
indirectly, and including any obligation of the
24
guarantor, direct or indirect, (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or other obligation or
to purchase (or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness or other obligation
of the payment thereof, (c) to maintain working capital, equity capital or any
other financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or other obligation or (d)
as an account party in respect of any letter of credit or letter of guaranty
issued to support such Indebtedness or obligation, provided that the term
--------
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
"Guarantee Agreements" means (a) with respect to each U.S. Loan Party,
--------------------
each Loan Party organized under the laws of the Cayman Islands and each other
Loan Party reasonably designated by the Administrative Agent, the U.S. Guarantee
Agreement and (b) with respect to each other Loan Party, a Foreign Subsidiary
Guarantee Agreement.
"Hazardous Materials" means all explosive, radioactive, hazardous or
-------------------
toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated
biphenyls, radon gas, infectious or medical wastes, and all substances or wastes
of any nature regulated pursuant to any Environmental Law, including any
material listed as a hazardous substance under Section 101(14) of CERCLA.
"Holdings" means New SAC, an exempted limited liability company
--------
incorporated and existing under the laws of the Cayman Islands.
"Holdings Distribution" means the distributions on or about the
---------------------
Effective Date by the U.S. Borrower and the Subsidiaries to the Cayman Borrower,
by the Cayman Borrower to Intermediate Holdings and to, or for the account of,
participants in a Deferred Compensation Plan in an aggregate amount not to
exceed the amount by which (i) the Cash Amount exceeds (ii) Material Funded
Indebtedness, in each case on the Effective Date after giving effect to the
Transactions.
"▇▇▇▇▇▇▇▇▇▇ Settlement" means the settlement of a patent interference
---------------------
action with ▇▇▇▇▇▇▇▇▇▇ Technology relating to certain patent applications held
by Seagate Technology LLC with respect to flexure-based microactuators and
certain patents and patent applications held by Seagate
25
Technology LLC with respect to flexures (the "Transferred Patents"), which
-------------------
settlement will involve the transfer of the Transferred Patents to ▇▇▇▇▇▇▇▇▇▇
Technology in exchange for (i) a royalty free license from ▇▇▇▇▇▇▇▇▇▇ Technology
of their patents with respect to this technology and (ii) royalties from
licenses by ▇▇▇▇▇▇▇▇▇▇ Technology of the Transferred Patents, together with a
cross-license between Seagate Technology LLC and ▇▇▇▇▇▇▇▇▇▇ Technology with
respect to interconnect circuitry patents.
"▇▇▇▇▇▇▇▇▇▇ Technology" means ▇▇▇▇▇▇▇▇▇▇ Technology Incorporated.
---------------------
"Indebtedness" of any Person means, without duplication, (a) all
------------
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d)
all obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all obligations of
such Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (f) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
Notwithstanding anything to the contrary in this paragraph, the term
"Indebtedness" shall not include (a) obligations under Swap Agreements, (b)
agreements providing for indemnification, purchase price adjustments or similar
obligations incurred or assumed in connection with the acquisition or
disposition of assets or stock or (c) liabilities incurred under the Deferred
Compensation Plans.
26
"Indemnification Agreement" means the indemnification agreement dated
-------------------------
as of March 29, 2000, among Holdings, Seagate Technology, Inc. and VERITAS
Software Corporation, inter alia as amended on August 29, 2000, and October 18,
2000.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
-----------------
"Indemnity, Subrogation and Contribution Agreement" means the
-------------------------------------------------
Indemnity, Subrogation and Contribution Agreement, substantially in the form of
Exhibit E, among the Borrowers, the Subsidiary Loan Parties and the Collateral
Agent.
"Index Debt" has the meaning assigned to such term in the definition
----------
of "Investment Grade Ratings".
"Information Memorandum" means the Confidential Information Memorandum
----------------------
dated April 18, 2002.
"Insignificant Core Loan Party" means, on any date of determination, a
----------------------
Core Loan Party that (i) has less than $2,500 in assets on such date, (ii) has
not conducted any business or operations during the period of four fiscal
quarters ended immediately prior to such date and (iii) does not hold any
patents, trademarks or copyrights.
"Interest Election Request" means a request by the applicable Borrower
-------------------------
to convert or continue a Revolving Borrowing or Term Borrowing in accordance
with Section 2.07.
"Interest Payment Date" means (a) with respect to any ABR Loan (other
---------------------
than a Swingline Loan), the last day of each March, June, September and
December, (b) with respect to any Eurodollar Loan, the last day of the Interest
Period applicable to the Borrowing of which such Loan is a part and, in the case
of a Eurodollar Borrowing with an Interest Period of more than three months'
duration, each day prior to the last day of such Interest Period that occurs at
intervals of three months' duration after the first day of such Interest Period,
and (c) with respect to any Swingline Loan, the day that such Loan is required
to be repaid.
"Interest Period" means, with respect to any Eurodollar Borrowing, the
---------------
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
(or 9 or 12 months if consented to by all the applicable Lenders) thereafter, as
the applicable Borrower may elect, provided that (a) if any Interest Period
--------
would
27
end on a day other than a Business Day, such Interest Period shall be extended
to the next succeeding Business Day unless such next succeeding Business Day
would fall in the next calendar month, in which case such Interest Period shall
end on the next preceding Business Day and (b) any Interest Period that
commences on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the last calendar month of such
Interest Period) shall end on the last Business Day of the last calendar month
of such Interest Period. For purposes hereof, the date of a Borrowing initially
shall be the date on which such Borrowing is made and thereafter shall be the
effective date of the most recent conversion or continuation of such Borrowing.
"Intermediate Holdings" means Seagate Technology Holdings, an exempted
---------------------
limited liability company incorporated and existing under the laws of the Cayman
Islands.
"Investment Grade Period" means any period (a) commencing on the first
-----------------------
day on which (x) the Index Debt (as defined below under "Investment Grade
Ratings") has Investment Grade Ratings and (y) no Default or Event of Default
has occurred and is continuing and (b) ending on the date on which the Index
Debt no longer has Investment Grade Ratings.
"Investment Grade Ratings" means that the Cayman Borrower's senior
------------------------
unsecured long-term debt (the "Index Debt") is rated both (a) BBB- (or, for
purposes of Section 6.05, BBB) or better by S&P and (b) Baa3 (or, for purposes
of Section 6.05, Baa2) or better by Moody's.
"Investors" means SLP, TPG, August Capital, JPMorgan Partners, LLC,
---------
▇▇▇▇▇▇▇ Sachs Capital Partners III, L.L.C. and Integral Capital Partners.
"IPO" means, with respect to any Person, a bona fide underwritten
---
initial public offering of voting common stock of such Person for cash in which
at least 10% of the aggregate voting common stock of such Person (calculated on
a fully diluted basis after giving effect to all options to acquire voting
common stock of such Person, then outstanding, regardless of whether such
options are then currently exercisable), is issued to Persons other than the
Investors, Holdings and their respective Affiliates (including all directors,
officers and employees of Holdings, either Borrower and any Subsidiary).
"Issuing Bank" means, as the context may require, (a) JPMorgan Chase
------------
Bank, with respect to Letters of Credit
28
issued by it, (b) any other Revolving Lender that becomes an Issuing Bank
pursuant to Section 2.05(l), with respect to Letters of Credit issued by it, and
(c) any Revolving Lender that has issued an Existing Letter of Credit, with
respect to such Existing Letter of Credit and, in each case, its successors in
such capacity as provided in Section 2.05(i). The Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by Affiliates
of the Issuing Bank, in which case the term "Issuing Bank" shall include any
such Affiliate with respect to Letters of Credit issued by such Affiliate.
"LC Disbursement" means a payment made by the Issuing Bank pursuant to
---------------
a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn
-----------
and unexpired amount of all outstanding Letters of Credit denominated in dollars
at such time plus (b) the aggregate amount of all LC Disbursements that were
made in dollars and that have not yet been reimbursed by or on behalf of the
Cayman Borrower at such time plus (c) the Alternative Currency LC Exposure at
such time. The LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the total LC Exposure at such time.
"Lender Affiliate" means, (a) with respect to any Lender, (i) an
----------------
Affiliate of such Lender or (ii) an entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by such Lender or an Affiliate of
such Lender and (b) with respect to any Lender that is a fund that invests in
bank loans and similar extensions of credit, any other fund that invests in bank
loans and similar extensions of credit and is managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.
"Lenders" means the Persons listed on Schedule 2.01 and any other
-------
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.
"Letter of Credit" means any letter of credit (including each Existing
----------------
Letter of Credit) issued pursuant to this Agreement.
29
"Leverage Ratio" means, on any date, the ratio of Funded Indebtedness
--------------
on such date to Consolidated EBITDA for the period of four consecutive fiscal
quarters of the Cayman Borrower ended on such date (or, if such date is not the
last day of a fiscal quarter, ended on the last day of the fiscal quarter of the
Cayman Borrower most recently ended prior to such date).
"LIBO Rate" means, with respect to any Eurodollar Borrowing for any
---------
Interest Period, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market 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 such service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits 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 the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
---------
Eurodollar Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
----
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loan Documents" means this Agreement, the Guarantee Agreements, the
--------------
Indemnity, Subrogation and Contribution Agreement, the Security Documents and
the Promissory Notes.
"Loan Parties" means Intermediate Holdings, the Borrowers and the
------------
Subsidiary Loan Parties provided, that upon the release of the Guarantee by
--------
Intermediate Holdings of the Obligations in accordance with the terms of the
U.S.
30
Guarantee Agreement, Intermediate Holdings shall cease to be a Loan Party for
all purposes hereunder.
"Loans" means the loans made by the Lenders to either Borrower
-----
pursuant to this Agreement.
"Long-Term Indebtedness" means any Indebtedness that, in accordance
----------------------
with GAAP, constitutes (or, when incurred, constituted) a long-term liability.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
business, assets, operations, properties or financial condition of Intermediate
Holdings (for so long as it is a Loan Party), the Borrowers and the
Subsidiaries, taken as a whole, (b) the ability of the Loan Parties to perform
their obligations under the Loan Documents or (c) any material rights of or
benefits available to the Lenders under the Loan Documents.
"Material Funded Indebtedness" means, as of any date, the sum of (a)
----------------------------
the aggregate principal amount of Existing Subordinated Debt outstanding as of
such date, (b) the aggregate principal amount of Senior Notes outstanding as of
such date and (c) the aggregate principal amount of Loans outstanding as of such
date.
"Material Indebtedness" means Indebtedness (other than the Loans and
---------------------
Letters of Credit), or obligations in respect of one or more Swap Agreements, of
any one or more of Intermediate Holdings (for so long as it is a Loan Party),
either Borrower or any Subsidiary in an aggregate principal amount exceeding
$20,000,000. For purposes of determining Material Indebtedness, the "principal
amount" of the obligations of any Person in respect of any Swap Agreement at any
time shall be the maximum aggregate amount (giving effect to any netting
agreements) that such Person would be required to pay if such Swap Agreement
were terminated at such time.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors.
-------
"Moribund Subsidiary" means a Subsidiary listed on Schedule 1.01(c),
-------------------
provided that (a) such Subsidiary has begun a dissolution, liquidation, winding
--------
up or similar process before or within 180 days after the Effective Date, and
such Subsidiary is actively and in good faith pursuing the completion of such
dissolution, liquidation, winding up or similar process, (b) such Subsidiary has
no business or operations and conducts no activities other than those activities
reasonably necessary to the dissolution of such
31
Subsidiary, (c) such Subsidiary does not incur any Indebtedness or other
liabilities (other than reasonable fees of attorneys and accountants and other
de minimis fees in connection with such dissolution, liquidation, winding up or
similar process) after the Effective Date and (d) the Moribund Subsidiaries as a
group shall not have more than $5,000,000 in assets. Notwithstanding anything to
the contrary in the preceding sentence, Seagate Technology Media Mexico S.A. de
C.V. ("STMM") shall be a Moribund Subsidiary provided that (a) STMM conducts no
--------
business, operations or activities other than those necessary to complete the
liquidation thereof, (b) STMM does not own any assets other than those assets
owned by it on the Effective Date and (c) STMM and the Borrowers use their best
efforts to complete the liquidation of STMM as soon as reasonably practicable,
and, in any event, such liquidation is completed on or prior to November 22,
2003.
"Mortgage" means a mortgage, deed of trust, assignment of leases and
--------
rents, leasehold mortgage or other security document granting a Lien on any
Mortgaged Property to secure the Obligations. Each Mortgage shall be reasonably
satisfactory in form and substance to the Collateral Agent.
"Mortgaged Property" means, initially, each parcel of real property
------------------
and the improvements thereto owned by a Loan Party and identified on Schedule
1.01, and includes each other parcel of real property and improvements thereto
with respect to which a Mortgage is granted pursuant to Section 5.12 or 5.13.
"Multiemployer Plan" means a multiemployer plan as defined in Section
------------------
4001(a)(3) of ERISA.
"Netherlands Holdings" means Seagate Technology (Netherlands) BV.
--------------------
"Netherlands Security Agreement" means the Deed of Pledge of Moveable
------------------------------
Property and Intellectual Property Rights, dated as of the Effective Date,
substantially in the form of Exhibit C-5, between STI and the Collateral Agent
for the benefit of the Secured Parties.
"Net Leverage Ratio" means, on any date, the ratio of (a) the excess
------------------
of (i) Funded Indebtedness as of such date over (ii) the sum of (A) the amount
of cash held by either Borrower or any Subsidiary and (B) the carrying value of
Permitted Investments that would be reflected as cash or short-term investments
on a consolidated balance sheet of the Cayman Borrower on such date to (b)
Consolidated EBITDA
32
for the period of four consecutive fiscal quarters of the Cayman Borrower ended
on such date (or, if such date is not the last day of a fiscal quarter, ended on
the last day of the fiscal quarter of the Cayman Borrower most recently ended
prior to such date).
"Net Proceeds" means, with respect to any event, (a) the cash proceeds
------------
received in respect of such event, including any cash received in respect of any
non-cash proceeds, but only as and when received, net of (b) the sum of (i) all
reasonable fees and out-of-pocket expenses (including underwriting discounts and
commissions and collection expenses) paid or payable by Intermediate Holdings
(for so long as it is a Loan Party), the Borrowers and the Subsidiaries to third
parties in connection with such event, (ii) in the case of a sale, transfer or
other disposition of an asset (including pursuant to a sale and leaseback
transaction), the amount of all payments required to be made by Intermediate
Holdings (for so long as it is a Loan Party), the Borrowers and the Subsidiaries
as a result of such event to repay Indebtedness (other than Loans) secured by
such asset or otherwise subject to mandatory prepayment as a result of such
event, and (iii) the amount of all taxes paid (or reasonably estimated to be
payable) by Intermediate Holdings (for so long as it is a Loan Party), the
Borrowers and the Subsidiaries plus the amount of all distributions that the
Cayman Borrower would be permitted to effect pursuant to Section 6.08(a)(vi) and
the amount of any reserves established by Intermediate Holdings (for so long as
it is a Loan Party), the Borrowers and the Subsidiaries to fund contingent
liabilities reasonably estimated to be payable, in each case during the year
that such event occurred or the next succeeding year and that are directly
attributable to such event (as determined reasonably and in good faith by the
chief financial officer of Intermediate Holdings or, after Intermediate Holdings
ceases to be a Loan Party, the Cayman Borrower).
"Net Public Equity Proceeds" means, with respect to any event, the
--------------------------
Publicly Traded Equity Securities received in respect of such event, excluding a
portion of such Publicly Traded Equity Securities having a fair market value (as
determined reasonably and in good faith by the chief financial officer of
Intermediate Holdings or the Cayman Borrower) equal to the sum of (i) all
reasonable fees and out-of-pocket expenses (including underwriting discounts and
commissions and collection expenses) paid or payable by Intermediate Holdings
(for so long as
33
it is a Loan Party), the Borrowers and the Subsidiaries to third parties in
connection with such event, (ii) the amount of all payments required to be made
by Intermediate Holdings (for so long as it is a Loan Party), the Borrowers and
the Subsidiaries as a result of such event to repay Indebtedness (other than
Loans) secured by such asset or otherwise subject to mandatory prepayment as a
result of such event, and (iii) the amount of all taxes paid (or reasonably
estimated to be payable) by Intermediate Holdings (for so long as it is a Loan
Party), the Borrowers and the Subsidiaries plus the amount of all distributions
that the Cayman Borrower would be permitted to effect pursuant to Section
6.08(a)(vi) and the amount of any reserves established by Intermediate Holdings
(for so long as it is a Loan Party), the Borrowers and the Subsidiaries to fund
contingent liabilities reasonably estimated to be payable, in each case during
the year that such event occurred or the next succeeding year and that are
directly attributable to such event (as determined reasonably and in good faith
by the chief financial officer of Intermediate Holdings or the Cayman Borrower).
"Non-Investment Grade Period" means any period of time other than an
---------------------------
Investment Grade Period.
"Northern Ireland Security Agreement" means each of the Debentures,
-----------------------------------
substantially in the form of Exhibit C-4, dated as of the Effective Date between
(a) each of Seagate Technology International, Seagate Technology Media (Ireland)
and Seagate Technology (Ireland) and (b) the Collateral Agent for the benefit of
the Secured Parties.
"Obligations" has the meaning assigned to such term in the U.S.
-----------
Security Agreement.
"Other Taxes" means any and all current or future recording, stamp,
-----------
documentary, excise, transfer, sales, property or similar taxes, charges or
levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"Outside Letter of Credit" means each letter of credit previously
------------------------
issued for the account of, or guaranteed by, a Borrower or a Subsidiary that (a)
is outstanding on the Effective Date and (b) is listed on Schedule 2.05(b).
"Overdraft Facility" means any same-day overdraft facility extended by
------------------
a bank or other lending institution to a Loan Party.
"Participant" has the meaning assigned to such term in Section
-----------
9.04(e).
34
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
----
defined in ERISA and any successor entity performing similar functions.
"Perfection Certificate" means a certificate in the form of Annex 1 to
----------------------
the U.S. Security Agreement or any other form approved by the Cayman Borrower
and the Administrative Agent.
"Permitted Acquisition" means any acquisition (whether by purchase,
---------------------
merger, consolidation or otherwise) by either Borrower or any consolidated
Subsidiary of all or substantially all the assets of, or at least 90% of the
Equity Interests in, a Person or division or line of business of a Person not
preceded by an unsolicited tender offer for such Person if, at the time of and
immediately after giving effect thereto, (a) no Default has occurred and is
continuing or would result therefrom, (b) the principal business of such Person
is reasonably related to a business in which the Borrowers and the Subsidiaries
were engaged on the Effective Date, (c) each Subsidiary formed for the purpose
of or resulting from such acquisition shall be a Core Loan Party and all of the
Equity Interests of such Core Loan Party are owned directly by a Borrower or a
consolidated Core Loan Party and all actions required to be taken with respect
to such acquired or newly formed Core Loan Party under Sections 5.12 and 5.13
shall have been taken, (d) the Borrowers and the Subsidiaries are in compliance,
on a pro forma basis after giving effect to such acquisition (giving effect to
any reductions in operating expenses permitted to be included for this purpose
in the calculation set forth in the definition of the term Consolidated EBITDA),
with the covenants contained in Sections 6.12, 6.13 and 6.14 recomputed as at
the last day of the most recently ended fiscal quarter of the Cayman Borrower
for which financial information is available, as if such acquisition (and any
related incurrence or repayment of Indebtedness, with any new Indebtedness being
deemed to be amortized over the applicable testing period in accordance with its
terms) had occurred on the first day of each relevant period for testing such
compliance and (e) the Cayman Borrower has delivered to the Administrative Agent
an officers' certificate to the effect set forth in clauses (a), (b), (c) and
(d) above, together with all relevant financial information for the Person or
assets to be acquired and reasonably detailed calculations demonstrating
satisfaction of the requirement set forth in clause (d) above.
"Permitted Cayman Borrower Equity Sales" means (a) the issuance and
--------------------------------------
sale by the Cayman Borrower of Equity
35
Interests in the Cayman Borrower pursuant to an IPO of the Cayman Borrower and,
subsequent to an IPO of the Cayman Borrower, pursuant to any other offering, (b)
the sale by Intermediate Holdings of Equity Interests in the Cayman Borrower
held by Intermediate Holdings pursuant to an IPO of the Cayman Borrower or (c)
subsequent to an IPO of the Cayman Borrower, the sale for cash or Publicly
Traded Equity Securities by Intermediate Holdings of Equity Interests in the
Cayman Borrower held by Intermediate Holdings to any Person (other than
Holdings, any subsidiary of Holdings or other Affiliate of Holdings or any
employee stock ownership plan or other trust established by Holdings or any
subsidiary of Holdings), provided, in each case, that a Permitted Intermediate
--------
Holdings Equity Sale has not occurred.
"Permitted Encumbrances" means:
----------------------
(a) Liens imposed by law for taxes or other governmental charges that
are not yet due or are being contested in compliance with Section 5.05;
(b) landlords', carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 30 days or are being contested in compliance with Section 5.05;
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) Liens (other than Liens on Collateral other than cash) to secure
the performance of bids, trade contracts, leases, statutory obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature, in each case in the ordinary course of business;
(e) judgment liens in respect of judgments that do not constitute an
Event of Default under clause (k) of Section 7.01;
(f) easements, zoning restrictions, licenses, reservations, covenants,
utility easements, building restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business and minor defects or irregularities in title that do not
secure any monetary obligations
36
and do not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of Intermediate Holdings,
either Borrower or any Subsidiary;
(g) any interest or title of a lessor under any lease permitted by
this Agreement;
(h) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(i) leases or subleases granted to other Persons and not interfering
in any material respect with the business of Intermediate Holdings, either
Borrower and the Subsidiaries, taken as a whole; and
(j) licenses of intellectual property granted in the ordinary course
of business;
provided that the term "Permitted Encumbrances" shall not include any Lien
--------
securing Indebtedness.
"Permitted High-Yield Indebtedness" means (a) the Existing
---------------------------------
Subordinated Debt not repurchased or redeemed pursuant to the Debt Tender Offer
and (b) the Senior Notes.
"Permitted Holders" means the Investors and any officer or member of
-----------------
the Board of Directors of Holdings, Intermediate Holdings, a Borrower or any
Subsidiary who owns Equity Interests of Holdings on the Effective Date.
"Permitted Intermediate Holdings Equity Sales" means the issuance and
--------------------------------------------
sale by Intermediate Holdings of Equity Interests in Intermediate Holdings (a)
pursuant to an IPO of Intermediate Holdings and (b) subsequent to an IPO of
Intermediate Holdings, pursuant to any other offering, provided, that a
--------
Permitted Cayman Borrower Equity Sale has not occurred.
"Permitted Investments" means:
---------------------
(a) direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any
agency thereof;
(b) investments in commercial paper maturing not more than one year
after the date of acquisition issued by a corporation (other than an
Affiliate of the Cayman Borrower) organized and in existence under the laws
of
37
the United States of America or any foreign country recognized by the
United States of America and having, at such date of acquisition, a rating
of "P-1" (or better) from Moody's or "A-1" (or better) from S & P;
(c) investments in (i) certificates of deposit, bankers' acceptances,
time deposits and money market deposit accounts maturing not more than one
year after the date of acquisition thereof issued or guaranteed by or
placed with any commercial bank or trust company organized under the laws
of the United States of America or any State thereof or any foreign country
recognized by the United States of America or (ii) obligations of United
States Federal agencies sponsored by the Federal government (including,
without limitation, the Federal Home Loan Bank, Federal Farm Credit Bank,
Federal Home Loan Mortgage Corporation and Federal National Mortgage
Association) that are not direct obligations of the United States of
America or any State thereof and are not obligations guaranteed by the
United States of America or any State thereof, in each case which bank,
trust company or Federally sponsored agency has a combined capital and
surplus and undivided profits in excess of $250,000,000 (or the foreign
currency equivalent thereof) and has outstanding debt which is rated "A"
(or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under
the Securities Act);
(d) fully collateralized repurchase obligations with a term of not
more than 45 days for securities described in clause (a) above or clause
(e), (f) or (g) below and entered into with a financial institution
satisfying the criteria described in clause (c) above;
(e) investments in securities issued or fully guaranteed by any state,
commonwealth or territory of the United States of America or any political
subdivision or taxing authority thereof having maturities of not more than
three years from the date of acquisition thereof and, having a rating of at
least "AA" from S&P or "Aa" from Moody's;
(f) investments in securities with maturities of one year or less from
the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and having a rating of
at least "A" from S&P or from Moody's;
38
(g) investments in securities issued by any foreign government or any
political subdivision of any foreign government or any public
instrumentality thereof having maturities of not more than six months from
the date of acquisition thereof and, at the time of acquisition, having one
of the two highest credit ratings obtainable from S&P or from Moody's;
(h) investments in corporate bonds or notes having maturities of not
more than three years from the date of acquisition thereof and having a
rating of at least "AA" from S&P or "Aa" from Moody's;
(i) auction rate preferred stock having maturities of not more than 90
days from the date of acquisition thereof, provided that the long-term
--------
senior unsecured debt of the issuer of such preferred stock shall have a
rating of at least "A" from S&P or from Moody's;
(j) investments in funds that invest solely in one or more types of
securities described in clauses (a) through (i) above; and
(k) money market funds that (i) comply with the criteria set forth in
Securities and Exchange Commission Rule 2a-7 under the Investment Company
Act of 1940 and (ii) have portfolio assets of at least $1,000,000,000.
"Permitted Liquidity Event Distribution" means the distribution of
--------------------------------------
Distributable Liquidity Event Proceeds, provided that
--------
(i) in the case of a distribution of Distributable Liquidity Event
Proceeds resulting from an event described in clauses (a) or (c) of the
definition of the term Distributable Liquidity Event Proceeds, a portion of
the Net Proceeds of such event equal to the portion designated for use
pursuant to Section 6.05(c)(iii)(B)(4) or Section 6.05(c)(iv)(B)(4) shall
have been used to prepay Term Loans pursuant to Section 2.11(c);
(ii) in the case of a distribution of Distributable Liquidity Event
Proceeds resulting from an event described in clause (b) of the definition
of the term Distributable Liquidity Event Proceeds, a portion of the Net
Proceeds of such event equal to the portion designated for use pursuant to
Section 6.05(c)(iv)(B)(1) and Section 6.05(c)(iv)(B)(4)
39
shall have been used to prepay Term Loans pursuant to Section 2.11(c);
(iii) in the case of a distribution of Distributable Liquidity Event
Proceeds resulting from an event described in clause (d) of the definition
of the term Distributable Liquidity Event Proceeds, a portion of the Net
Proceeds of such event equal to the sum of (x) the amount designated for
use pursuant to Section 6.05(c)(iii)(B)(1) and Section 6.05(c)(iii)(B)(4)
and (y) the amount of Net Proceeds resulting from such event not
contributed to the Cayman Borrower by Intermediate Holdings shall have been
used to prepay Term Loans pursuant to Section 2.11(c); and
(iv) if the participants in a Deferred Compensation Plan ("Entitled
--------
Participants") are entitled thereunder to receive a portion of the
------------
Distributable Liquidity Event Proceeds available for a Permitted Liquidity
Event Distribution (or would be so entitled, but for the failure of such
participants' interest in such Deferred Compensation Plan to have vested at
the time of such Permitted Liquidity Event Distribution), (a) no
distribution of such Distributable Liquidity Event Proceeds shall be made
to the Investors to the extent that the amount of such Distributable
Liquidity Event Proceeds exceeds the amount thereof to which the Investors
are entitled after deducting amounts to which participants in the
applicable Deferred Compensation Plan are (or, upon vesting, would be)
entitled under the applicable Deferred Compensation Plan and (b) no
distribution of such Distributable Liquidity Event Proceeds shall be made
to the Entitled Participants to the extent that the amount of such
Distributable Liquidity Event Proceeds exceeds the amount thereof to which
the Entitled Participants are (or, upon vesting, would be) entitled under
the applicable Deferred Compensation Plan.
"Permitted Obligation" means an obligation of either Borrower or any
--------------------
Subsidiary (for purposes of this definition, a "Primary Obligor") not
---------------
constituting Indebtedness, provided (i) such obligation is entered into in the
--------
ordinary course of such Primary Obligor's business, (ii) any Guarantee of such
obligation by any Loan Party is given in the ordinary course of such guarantor
Loan Party's business and (iii) any Guarantee of such obligation is reasonably
consistent with the practices of the Loan Parties and reasonably necessary to
permit the Primary Obligor to incur such obligation.
40
"Permitted Optionholder" means a holder of Permitted Options or any
----------------------
equity securities issued upon the exercise of Permitted Options.
"Permitted Options" has the meaning assigned to such term in Section
-----------------
6.05(e).
"Person" means any natural person, corporation, limited liability
------
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
----
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which either Borrower
or any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pledge Agreements" means the Cayman Pledge Agreements, the Singapore
-----------------
Pledge Agreement and the U.S. Pledge Agreement.
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time to time by JPMorgan Chase Bank as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Promissory Notes" means any promissory notes delivered pursuant to
----------------
Section 2.09(e).
"Publicly Traded Equity Security" means (a) an equity security that is
-------------------------------
listed on The New York Stock Exchange, The NASDAQ National Market or another
recognized national securities exchange registered with the United States
Securities and Exchange Commission (b) an equity security that is convertible at
the option of the holder thereof into an equity security referred to in clause
(a) above.
"Register" has the meaning set forth in Section 9.04(c).
--------
"Related Parties" means, with respect to any specified Person, such
---------------
Person's Affiliates and the respective directors, officers, employees, agents,
trustees and advisors of such Person and such Person's Affiliates.
41
"Release" means any release, spill, emission, leaking, dumping,
-------
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
"Required Lenders" means, at any time, Lenders having Revolving
----------------
Exposures, Term Loans and unused Commitments representing more than 50% of the
sum of the total Revolving Exposures, outstanding Term Loans and unused
Commitments at such time.
"Reset Date" has the meaning assigned to such term in Section 1.05(a).
----------
"Restricted Indebtedness" means Indebtedness of Intermediate Holdings
-----------------------
(for so long as it is a Loan Party), either Borrower or any Subsidiary, the
payment, prepayment, redemption, repurchase or defeasance of which is restricted
under Section 6.08.
"Restricted Payment" means (i) any dividend or other distribution
------------------
(whether in cash, securities or other property) with respect to any Equity
Interests in either Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancelation or
termination of any Equity Interests in either Borrower or any Subsidiary or any
option, warrant or other right to acquire any such Equity Interests in either
Borrower or any Subsidiary and (ii) any distribution or other payment (whether
in cash, securities or other property or any combination thereof) under or in
respect of any Deferred Compensation Plan.
"Revolving Availability Period" means the period from and including
-----------------------------
the Effective Date to but excluding the earlier of the Revolving Maturity Date
and the date of termination of the Revolving Commitments.
"Revolving Commitment" means, with respect to each Lender, the
--------------------
commitment, if any, of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender's Revolving
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 9.04. The initial amount
of each Lender's Revolving
42
Commitment is set forth on Schedule 2.01, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Revolving Commitment, as
applicable. The initial aggregate amount of the Lenders' Revolving Commitments
is $150,000,000.
"Revolving Exposure" means, with respect to any Lender at any time,
------------------
the sum of (a) the outstanding principal amount of such Lender's Revolving Loans
and (b) such Lender's LC Exposure and Swingline Exposure at such time.
"Revolving Lender" means a Lender with a Revolving Commitment or, if
----------------
the Revolving Commitments have terminated or expired, a Lender with Revolving
Exposure.
"Revolving Loan" means a Loan made pursuant to clause (c) of Section
--------------
2.01.
"Revolving Maturity Date" means May 13, 2007, or, if such day is not a
-----------------------
Business Day, the Business Day immediately preceding such day.
"S&P" means Standard & Poor's Rating Service and its successors.
---
"SAN Holdings" means Seagate Technology SAN Holdings, an exempted
------------
limited liability company organized and existing under the laws of the Cayman
Islands.
"Secondary Distribution" means distributions by the U.S. Borrower and
----------------------
STI to the Cayman Borrower, by the Cayman Borrower to Intermediate Holdings, its
other shareholders (ratably in accordance with their equity ownership) and to,
or for the account of, participants in Deferred Compensation Plans in an
aggregate amount not to exceed Cash From Operations, provided that (a) such
--------
distributions are made concurrently with the consummation of an IPO by
Intermediate Holdings or the Cayman Borrower, (b) on the date of such
distributions and after giving pro forma effect thereto and to such IPO and the
application of the proceeds thereof (including the application of any
Distributable Liquidity Event Proceeds received in connection therewith) (i) the
ratio of (x) the Cash Amount to (y) Indebtedness of the Cayman Borrower and its
consolidated subsidiaries (other than Indebtedness in respect of letters of
credit securing obligations entered into in the ordinary course of business to
the extent such letters of credit are not drawn upon or, if and to the extent
drawn upon, such drawing is reimbursed no later than the 30th Business Day
following payment on such letters of credit) is no less than 1.1 to 1.0 and (ii)
no Default or
43
Event of Default has occurred and is continuing and (c) prior to such
distributions, the Cayman Borrower shall have delivered to the Administrative
Agent a certificate dated as of such date and signed by a Financial Officer of
the Cayman Borrower that (i) sets forth, in reasonable detail, the calculation
of the amount of such distributions, (ii) certifies compliance with the ratio
set forth in clause (b)(i) above and (iii) certifies that the cash used to pay
the Secondary Distribution was generated in the ordinary course of business.
"Secured Parties" has the meaning assigned to such term in the U.S.
---------------
Security Agreement.
"Security Agreements" means the Cayman Security Agreements, the
-------------------
Netherlands Security Agreement, the Northern Ireland Security Agreement, the
Singapore Security Agreements, the U.K. Security Agreement, and the U.S.
Security Agreement.
"Security Documents" means the Security Agreements, the Pledge
------------------
Agreements, the Mortgages, any other Foreign Security Agreements and each other
security agreement or other instrument or document executed and delivered
pursuant to Section 5.12 or 5.13 to secure any of the Obligations.
"Senior Notes" means the 8% Senior Notes due 2009 to be issued by the
------------
Cayman Borrower on or prior to the Effective Date in the aggregate principal
amount not to exceed $400,000,000 and the Indebtedness represented thereby
(including the Parent Guaranty, the Exchange Notes (each as defined in the
Senior Note Documents), the guarantees of the Exchange Notes and any replacement
notes).
"Senior Note Documents" means the indenture under which the Senior
---------------------
Notes are issued and all other instruments, agreements and other documents
evidencing or governing the Senior Notes or providing for any Guarantee in
respect thereof by Intermediate Holdings.
"Singapore Pledge Agreement" means the Singapore Shares Charge, dated
--------------------------
as of the Effective Date, substantially in the form of Exhibit D-3, between STI
and the Collateral Agent for the benefit of the Secured Parties.
"Singapore Security Agreements" means, collectively, (a) the Singapore
-----------------------------
Debentures, dated as of the Effective Date and substantially in form of Exhibit
C-3--A, (i) between STI and the Collateral Agent for the benefit of the Secured
Parties and (ii) between Seagate Singapore
44
Distribution Pte. Ltd. and the Collateral Agent for the benefit of the Secured
Parties and (b) the Singapore Assignments of Trade Receivables, dated as of the
Effective Date and substantially in the form of Exhibit C-3--B, (i) between STI
and the Collateral Agent for the benefit of the Secured Parties and (ii) between
Seagate Singapore Distribution Pte. Ltd. and the Collateral Agent for the
benefit of the Secured Parties.
"SLP" means Silver Lake Partners, L.P. and its Affiliates, provided
--- --------
that no such Affiliate shall be deemed to be a member of SLP to the extent it
ceases to be Controlled by, or under common Control with, Silver Lake Partners,
L.P.
"Statutory Reserve Rate" means a fraction (expressed as a decimal),
----------------------
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"STI" means Seagate Technology International, an exempted limited
---
liability company organized under the laws of the Cayman Islands.
"Strategic Investments" means investments in Equity Interests in
---------------------
Persons that are primarily engaged in businesses of the type conducted by the
Borrowers and the Subsidiaries on the date hereof or businesses reasonably
related, ancillary or complementary thereto.
"subsidiary" means, with respect to any Person (the "parent") at any
---------- ------
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation,
45
limited liability company, partnership, association or other entity (a) of which
securities or other ownership interests representing more than 50% of the equity
or more than 50% of the ordinary voting power or, in the case of a partnership,
more than 50% of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, otherwise Controlled, by
the parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.
"Subsidiary" means any subsidiary of the Cayman Borrower other than
----------
the U.S. Borrower.
"Subsidiary Loan Party" means (a) any Subsidiary (other than (i) any
---------------------
Moribund Subsidiary and (ii) any Insignificant Core Loan Party) that (A) is not
a Foreign Subsidiary or (B) is a Foreign Subsidiary that is organized under the
laws of Thailand, Singapore, Mexico or Japan or meets the requirements set forth
in any of clause (i), clause (ii) or clause (iii) of paragraph (c) of the
definition of the term Collateral and Guarantee Requirement and (b) any other
Foreign Subsidiary that the Cayman Borrower designates as a Subsidiary Loan
Party in a written notice to the Administrative Agent.
"Swap Agreement" means any agreement with respect to any swap,
--------------
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions, provided that
--------
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of either Borrower or the Subsidiaries shall be a Swap Agreement.
"Swingline Exposure" means, at any time, the aggregate principal
------------------
amount of all Swingline Loans outstanding at such time. The Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.
"Swingline Lender" means JPMorgan Chase Bank, in its capacity as
----------------
lender of Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section 2.04.
--------------
46
"Taxes" means any and all current or future taxes, levies,
-----
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loans" means the Cayman Term Loans and the U.S. Term Loans.
----------
"Term Loan Commitment" means, with respect to each Lender, the
--------------------
commitment, if any, of such Lender to make Term Loans hereunder on the Effective
Date, expressed as an amount representing the maximum principal amount of the
Term Loans to be made by such Lender hereunder, as such commitment may be (a)
reduced from time to time pursuant to Section 2.08 and (b) reduced or increased
from time to time pursuant to assignments by or to such Lender pursuant to
Section 9.04. The initial amount of each Lender's Term Loan Commitment is set
forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to which
such Lender shall have assumed its Term Loan Commitment, as applicable. The
initial aggregate amount of the Lenders' Term Loan Commitments is $350,000,000.
"Term Lender" means a Lender with a Term Loan Commitment or an
-----------
outstanding Term Loan.
"Term Loan Maturity Date" means May 13, 2007, or if such date is not a
-----------------------
Business Day, the Business Day immediately preceding such day.
"Thai Mortgages" means the Mortgages relating to the properties
--------------
located at ▇▇▇▇▇-▇▇ ▇▇▇ ▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, KM225 Mitraphap
Hwy, Nakorn Ratchasima, Thailand and ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇-▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇.
"TPG" means TPG Partners III, L.P. and its Affiliates, provided that
--- --------
no such Affiliate shall be deemed to be a member of TPG to the extent it ceases
to be Controlled by, or under common Control with, TPG Partners III, L.P.
"Transaction Costs" means the fees and expenses (including
-----------------
underwriting discounts and commissions but excluding tender premiums, consent
fees and accrued interest in connection with the Debt Tender Offer) incurred or
borne by Intermediate Holdings, the Borrower and the Subsidiaries in connection
with the Transactions.
"Transactions" means (a) the issuance of the Senior Notes, (b) the
------------
consummation of the Debt Tender Offer, (c) the repayment of all obligations
under the Existing
47
Credit Agreement (and the termination of the commitments and security interests
created thereunder) and (d) the payment of the Holdings Distribution.
"Type", when used in reference to any Loan or Borrowing, refers to
----
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"U.S. Borrower" means Seagate Technology (US) Holdings, Inc., a
--------------
Delaware corporation.
"U.S. Guarantee Agreement" means the U.S. Guarantee Agreement, dated
-------------------------
as of the Effective Date, substantially in the form of Exhibit F, among
Intermediate Holdings, the U.S. Loan Parties, the Subsidiary Loan Parties that
are organized under the laws of the Cayman Islands, the other applicable
Subsidiary Loan Parties and the Collateral Agent for the benefit of the Secured
Parties.
"U.K. Security Agreement" means the Charge over Bank Account, dated as
-----------------------
of the Effective Date, substantially in the form of Exhibit G between Seagate
Technology International and the Collateral Agent, for the benefit of the
Secured Parties.
"U.S. Loan Parties" means any Loan Parties that are organized under
-----------------
the laws of the United States of America or any State thereof or the District of
Columbia.
"U.S. Pledge Agreement" means the Pledge Agreement, dated as of the
---------------------
Effective Date, substantially in the form of Exhibit D-1, among the U.S. Loan
Parties and each other Loan Party that owns Equity Interests in a Person that is
organized under the laws of the United States of America and that would
constitute Collateral if such Loan Party executed the U.S. Pledge Agreement and
the Collateral Agent for the benefit of the Secured Parties.
"U.S. Security Agreement" means the U.S. Security Agreement, dated as
-----------------------
of the Effective Date, substantially in the form of Exhibit C-1, among the U.S.
Loan Parties and the Collateral Agent for the benefit of the Secured Parties.
"U.S. Term Loan" means a Loan made pursuant to clause (b) of Section
--------------
2.01.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
--------------------
result of a complete or partial
48
withdrawal from such Multiemployer Plan, as such terms are defined in Part I of
Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes of
---------------------------------------
this Agreement, Loans may be classified and referred to by Class (e.g., a
----
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
----
(e.g., a "Eurodollar Revolving Loan"). Borrowings also may be classified and
----
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
---- ----
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
----
Borrowing").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
----------------
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
-----------------------
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time, provided
--------
that, if the Cayman Borrower notifies the Administrative Agent that the Cayman
Borrower requests an amendment to any provision hereof to eliminate the effect
of any change occurring after the date hereof in GAAP or in the application
thereof on the operation of such provision (or if the Administrative Agent
notifies the Cayman Borrower
49
that the Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. For the purposes of
determining compliance under Sections 6.01, 6.02, 6.04, 6.05, 6.06, 6.08, 6.09
and 6.15 with respect to any amount in a currency other than Dollars, such
amount shall be deemed to equal the Dollar Equivalent thereof (determined in
good faith by the Cayman Borrower) at the time such amount was incurred or
expended, as the case may be.
SECTION 1.05. Exchange Rates. (a) Not later than 1:00 p.m., New York
---------------
City time, on each Calculation Date, the Administrative Agent shall (i)
determine the Exchange Rate as of such Calculation Date to be used for
calculating the Dollar Equivalent amounts of each Alternative Currency in which
an outstanding Alternative Currency Letter of Credit or unreimbursed LC
Disbursement is denominated and (ii) give notice thereof to the Cayman Borrower.
The Exchange Rates so determined shall become effective on the first Business
Day immediately following the relevant Calculation Date (a "Reset Date"), shall
----------
remain effective until the next succeeding Reset Date and shall for all purposes
of this Agreement (other than converting into dollars under Sections 2.05(d),
(e), (h), (j) and (k) and 2.12(b) the obligations of the Cayman Borrower and the
Revolving Lenders in respect of LC Disbursements that have not been reimbursed
when due) be the Exchange Rates employed in converting any amounts between the
applicable currencies.
(b) Not later than 5:00 p.m., New York City time, on each Reset Date,
the Administrative Agent shall (i) determine the Alternative Currency LC
Exposure on such date (after giving effect to any Alternative Currency Letters
of Credit issued, renewed or terminated or requested to be issued, renewed or
terminated on such date) and (ii) notify the Cayman Borrower and each Issuing
Bank of the results of such determination.
ARTICLE II
The Credits
-----------
SECTION 2.01. Commitments. Subject to the terms and conditions set
------------
forth herein, each Lender agrees (a) to make a Term Loan to the Cayman Borrower
on the Effective
50
Date in a principal amount not exceeding 71.43% of its Term Loan Commitment, (b)
to make a Term Loan to the U.S. Borrower on the Effective Date in a principal
amount not exceeding 28.57% of its Term Loan Commitment and (c) to make
Revolving Loans to the Cayman Borrower from time to time during the Revolving
Availability Period in an aggregate principal amount that will not result in
such Lender's Revolving Exposure exceeding such Lender's Revolving Commitment,
provided that no Revolving Loans will be made on the Effective Date. Within the
--------
foregoing limits and subject to the terms and conditions set forth herein, the
Cayman Borrower may borrow, prepay and reborrow Revolving Loans. Amounts repaid
or prepaid in respect of Term Loans may not be reborrowed.
SECTION 2.02. Loans and Borrowings. (a) Each Loan (other than a
---------------------
Swingline Loan) shall be made as part of a Borrowing consisting of Loans of the
same Class and Type made by the Lenders ratably in accordance with their
respective Commitments of the applicable Class. The failure of any Lender to
make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder, provided that the Commitments of the Lenders are
--------
several and no Lender shall be responsible for any other Lender's failure to
make Loans as required.
(b) Subject to Section 2.14, each Revolving Borrowing and Term
Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the
applicable Borrower may request in accordance herewith, provided that all
--------
Borrowings made on the Effective Date shall be ABR Borrowings. Each Swingline
Loan shall be an ABR Loan. Each Lender at its option may make any Eurodollar
Loan by causing any domestic or foreign branch or Affiliate of such Lender to
make such Loan, provided that (i) any exercise of such option shall not affect
--------
the obligation of the Borrowers to repay such Loan in accordance with the terms
of this Agreement and (ii) the Borrowers shall not be required to make any
greater payment under Section 2.15 or Section 2.17 to the applicable Lender than
such Lender would have been entitled to receive if such Lender had not exercised
such option.
(c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate amount that is an integral
multiple of $1,000,000 and not less than $20,000,000. At the time that each ABR
Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that
is an integral multiple of $500,000 and not less than $10,000,000, provided that
--------
an ABR Revolving Borrowing may be in an aggregate amount that is equal to the
entire unused balance of the total Revolving
51
Commitments or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.05(e). Each Swingline Loan shall be in
an amount that is an integral multiple of $100,000 and not less than $500,000.
Borrowings of more than one Type and Class may be outstanding at the same time,
provided that there shall not at any time be more than (x) a total of six
--------
Eurodollar Borrowings outstanding comprised of Revolving Loans and (y) a total
of six Eurodollar Borrowings outstanding comprised of Term Loans.
(d) Notwithstanding any other provision of this Agreement, the
Borrowers shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Revolving Maturity Date or Term Loan Maturity Date, as applicable.
SECTION 2.03. Requests for Borrowings. To request a Revolving
------------------------
Borrowing or Term Borrowing, the applicable Borrower shall notify the
Administrative Agent of such request by telephone (a) in the case of a
Eurodollar Borrowing, not later than 1:00 p.m., New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of an
ABR Borrowing, not later than 2:00 p.m., New York City time, one Business Day
before the date of the proposed Borrowing, provided that any such notice of an
--------
ABR Revolving Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.05(e) may be given not later than 1:00 p.m., New York
City time, on the date of the proposed Borrowing. Each such telephonic Borrowing
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Borrowing Request in a form
approved by the Administrative Agent and signed by the applicable Borrower. Each
such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:
(i) in the case of a Borrowing requested by the Cayman Borrower,
whether the requested Borrowing is to be a Revolving Borrowing or Term
Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) the date of such Borrowing, which shall be a Business Day;
(iv) subject to the proviso to the first sentence of Section 2.02(b),
whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
52
(v) in the case of a Eurodollar Borrowing, the initial Interest Period
to be applicable thereto, which shall be a period contemplated by the
definition of the term "Interest Period"; and
(vi) the location and number of the applicable Borrower's account to
which funds are to be disbursed, which shall comply with the requirements
of Section 2.06.
If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Revolving Borrowing, then the applicable
Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.04. Swingline Loans. (a) Subject to the terms and conditions
----------------
set forth herein, the Swingline Lender agrees to make Swingline Loans to the
Cayman Borrower from time to time during the Revolving Availability Period, in
an aggregate principal amount at any time outstanding that will not result in
(i) the aggregate principal amount of outstanding Swingline Loans exceeding
$20,000,000 or (ii) the sum of the total Revolving Exposures exceeding the total
Revolving Commitments, provided that (A) the Swingline Lender shall not be
--------
required to make a Swingline Loan to refinance an outstanding Swingline Loan and
(B) no Swingline Loans will be made on the Effective Date. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Cayman
Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Cayman Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy), not
later than 2:00 p.m., New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Cayman Borrower. The Swingline Lender shall make each
Swingline Loan available to the Cayman Borrower by means of a credit to the
general deposit account of the Cayman Borrower with the Swingline Lender (or, in
the case of a Swingline Loan made to finance the reimbursement of an LC
Disbursement as
53
provided in Section 2.05(e), by remittance to the Issuing Bank) by 4:00 p.m.,
New York City time, on the requested date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 12:30 p.m., New York City time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding. Such notice
shall specify the aggregate amount of Swingline Loans in which Revolving Lenders
will participate. Promptly upon receipt of such notice, the Administrative Agent
will give notice thereof to each Revolving Lender, specifying in such notice
such Lender's Applicable Percentage of such Swingline Loan or Swingline Loans.
Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt
of notice as provided above, to pay to the Administrative Agent, for the account
of the Swingline Lender, such Lender's Applicable Percentage of such Swingline
Loan or Swingline Loans. Each Revolving Lender acknowledges and agrees that its
obligation to acquire participations in Swingline Loans pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. Each
Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Lenders),
------- --------
and the Administrative Agent shall promptly pay to the Swingline Lender the
amounts so received by it from the Revolving Lenders. The Administrative Agent
shall notify the Cayman Borrower of any participations in any Swingline Loan
acquired pursuant to this paragraph, and thereafter payments in respect of such
Swingline Loan shall be made to the Administrative Agent and not to the
Swingline Lender. Any amounts received by the Swingline Lender from the Cayman
Borrower (or other party on behalf of the Cayman Borrower) in respect of a
Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale
of participations therein shall be promptly remitted to the Administrative
Agent; any such amounts received by the Administrative Agent shall be promptly
remitted by the Administrative Agent to the Revolving Lenders that shall have
made their payments pursuant to this paragraph and to the Swingline Lender, as
their interests may appear. The purchase of participations in a Swingline Loan
pursuant to
54
this paragraph shall not relieve the Cayman Borrower of any default in the
payment thereof.
SECTION 2.05. Letters of Credit. (a) General. Upon the satisfaction
------------------ --------
(or waiver in accordance with Section 9.02) of the conditions specified in
Section 4.01 on the Effective Date, each Existing Letter of Credit will
automatically, without any action on the part of any Person, be deemed to be a
Letter of Credit issued hereunder for the account of the Cayman Borrower for all
purposes of this Agreement and the other Loan Documents. In addition, subject to
the terms and conditions set forth herein, the Cayman Borrower may request the
issuance of Letters of Credit for its own account, in a form reasonably
acceptable to the Administrative Agent and the Issuing Bank, at any time and
from time to time during the Revolving Availability Period and prior to the date
that is five Business Days prior to the Revolving Maturity Date. In the event of
any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by the Cayman Borrower to, or entered into by the Cayman
Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and
conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
----------------------------------------------------------
Conditions. To request the issuance of a Letter of Credit (or the amendment,
----------
renewal or extension of an outstanding Letter of Credit), the Cayman Borrower
shall hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably in advance of the requested date
of issuance, amendment, renewal or extension) a notice requesting the issuance
of a Letter of Credit, or identifying the Letter of Credit to be amended,
renewed or extended, and specifying the date of issuance, amendment, renewal or
extension (which shall be a Business Day), the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the currency in which such Letter of Credit is
to be denominated (which shall be dollars or, subject to Section 2.20, an
Alternative Currency), the name and address of the beneficiary thereof and such
other information as shall be necessary to prepare, amend, renew or extend such
Letter of Credit. If requested by the Issuing Bank, the Cayman Borrower also
shall submit a letter of credit application on the Issuing Bank's standard form
in connection with any request for a Letter of Credit. A Letter of Credit shall
be issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or
55
extension of each Letter of Credit the Cayman Borrower shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension (i) the LC Exposure shall not exceed
$100,000,000 and (ii) the total Revolving Exposures shall not exceed the total
Revolving Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
---------------
the close of business on the earlier of (i) (x) the date one year after the date
of the issuance of such Letter of Credit (or, (A) in the case of any renewal or
extension thereof, one year after such renewal or extension, or (B) in the case
of an Existing Letter of Credit having a later expiration date, such expiration
date) or (y) such other date mutually agreed upon by an Issuing Bank and the
Cayman Borrower (but in no event shall such date be later than as provided in
clause (ii) of this paragraph (c)) and (ii) the date that is five Business Days
prior to the Revolving Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
---------------
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit
(including each Existing Letter Credit) equal to such Lender's Applicable
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Revolving
Lender hereby absolutely and unconditionally agrees to pay to the Administrative
Agent in dollars, for the account of the Issuing Bank, such Lender's Applicable
Percentage of (i) each LC Disbursement made by the Issuing Bank in dollars and
(ii) the Dollar Equivalent, using the Exchange Rates on the date such payment is
required, of each LC Disbursement made by the Issuing Bank in an Alternative
Currency and, in each case, not reimbursed by the Cayman Borrower on the date
due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Cayman Borrower for any reason (or, if
such reimbursement payment was refunded in an Alternative Currency, the Dollar
Equivalent thereof using the Exchange Rates on the date of such refund). Each
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of any Letter of Credit or the
occurrence and continuance of a Default or reduction or termination of the
Commitments, and
56
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement
-------------
in respect of a Letter of Credit, the Cayman Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement, in dollars or (subject to the two immediately succeeding
sentences) the applicable Alternative Currency, not later than 2:00 p.m., New
York City time, on the Business Day immediately following the date on which the
Cayman Borrower receives notice of such LC Disbursement, provided that, in the
--------
case of any LC Disbursement made in dollars, the Cayman Borrower may, subject to
the conditions to borrowing set forth herein, request in accordance with Section
2.03 or 2.04 that such payment be financed with an ABR Revolving Borrowing or
Swingline Loan in an equivalent amount and, to the extent so financed, the
Cayman Borrower's obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing or Swingline Loan. If the
Cayman Borrower's reimbursement of, or obligation to reimburse, any amounts in
any Alternative Currency would subject the Administrative Agent, the Issuing
Bank or any Lender to any stamp duty, ad valorem charge or similar tax that
would not be payable if such reimbursement were made or required to be made in
dollars, the Cayman Borrower shall reimburse each LC Disbursement made in such
Alternative Currency in dollars, in an amount equal to the Dollar Equivalent,
calculated using the applicable Exchange Rate on the date such LC Disbursement
is made, of such LC Disbursement. If the Cayman Borrower fails to make such
payment when due, then (i) if such payment relates to an Alternative Currency
Letter of Credit, automatically and with no further action required, the Cayman
Borrower's obligation to reimburse the applicable LC Disbursement shall be
permanently converted into an obligation to reimburse the Dollar Equivalent,
calculated using the Exchange Rates on the date when such payment was due, of
such LC Disbursement and (ii) the Administrative Agent shall promptly notify the
Issuing Bank and each other Revolving Lender of the applicable LC Disbursement,
the Dollar Equivalent thereof (if such LC Disbursement relates to an Alternative
Currency Letter of Credit), the payment then due from the Cayman Borrower in
respect thereof and, in the case of a Revolving Lender, such Lender's Applicable
Percentage thereof. Promptly following receipt of such notice, each Revolving
Lender shall pay to the Administrative Agent in dollars its Applicable
Percentage of the payment then due from the Cayman Borrower (determined as
provided in clause (i) above, if such payment relates to an Alternative Currency
Letter of Credit), in the same manner as provided in Section 2.06 with
57
respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis
-------
mutandis, to the payment obligations of the Revolving Lenders), and the
--------
Administrative Agent shall promptly pay to the applicable Issuing Bank in
dollars the amounts so received by it from the Revolving Lenders. Promptly
following receipt by the Administrative Agent of any payment from the Cayman
Borrower pursuant to this paragraph, the Administrative Agent shall distribute
such payment to such Issuing Bank or, to the extent that Revolving Lenders have
made payments pursuant to this paragraph to reimburse such Issuing Bank, then to
such Lenders and the Issuing Bank as their interests may appear. Any payment
made by a Revolving Lender pursuant to this paragraph to reimburse the Issuing
Bank for any LC Disbursement (other than the funding of ABR Revolving Loans or a
Swingline Loan as contemplated above) shall not constitute a Loan and shall not
relieve the Cayman Borrower of its obligation to reimburse such LC Disbursement.
(f) Obligations Absolute. The Cayman Borrower's obligation to
---------------------
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit, any application for the issuance of a Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms of
such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Cayman Borrower's obligations hereunder.
None of the Administrative Agent, the Lenders, the Issuing Bank or any of their
Related Parties shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising
58
from causes beyond the control of the Issuing Bank, provided that the foregoing
--------
provisions of this paragraph (f) shall not be construed to excuse the Issuing
Bank from liability to the Cayman Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrowers to the extent permitted by applicable law) suffered by
the Cayman Borrower that are caused by (i) the Issuing Bank's failure to
exercise care when determining whether drafts and other documents presented
under a Letter of Credit comply with the terms thereof or (ii) the Issuing
Bank's failure to issue a Letter of Credit in accordance with the terms of this
Agreement when requested by the Cayman Borrower pursuant to Section 2.05(b). The
parties hereto expressly agree that, in the absence of gross negligence or
wilful misconduct on the part of the Issuing Bank (as finally determined by a
court of competent jurisdiction), the Issuing Bank shall be deemed to have
exercised care in each such determination and each issuance of (or failure to
issue) a Letter of Credit. In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented that appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for
further investigation or refuse to accept and make payment upon such documents
if such documents are not in strict compliance with the terms of such Letter of
Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
------------------------
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
notify the Administrative Agent and the Cayman Borrower by telephone (confirmed
by telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder, provided that any failure to give or
--------
delay in giving such notice shall not relieve the Cayman Borrower of its
obligation to reimburse the Issuing Bank and the Revolving Lenders with respect
to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC
-----------------
Disbursement, then, unless the Cayman Borrower shall reimburse such LC
Disbursement in full on the date such LC Disbursement is made, the unpaid amount
thereof shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Cayman Borrower
reimburses such LC Disbursement, at the rate per annum then applicable to ABR
Revolving Loans, provided that, if the Cayman Borrower fails to reimburse
--------
59
such LC Disbursement when due pursuant to paragraph (e) of this Section, then
Section 2.13(c) shall apply, provided further that, in the case of an LC
-------- -------
Disbursement made under an Alternative Currency Letter of Credit, the amount of
interest due with respect thereto shall (i) in the case of any LC Disbursement
that is reimbursed on or before the Business Day immediately succeeding such LC
Disbursement, (A) be payable in the applicable Alternative Currency and (B) bear
interest at a rate equal to the rate reasonably determined by the applicable
Issuing Bank to be the cost to such Issuing Bank of funding such LC Disbursement
plus the Applicable Margin applicable to Eurodollar Loans at such time and (ii)
in the case of any LC Disbursement that is reimbursed after the Business Day
immediately succeeding such LC Disbursement (A) be payable in dollars, (B)
accrue on the Dollar Equivalent, calculated using the Exchange Rates on the date
such LC Disbursement was made, of such LC Disbursement and (C) bear interest at
the rate per annum then applicable to ABR Revolving Loans, subject to Section
2.13(c). Interest accrued pursuant to this paragraph shall be for the account of
the Issuing Bank, except that interest accrued on and after the date of payment
by any Revolving Lender pursuant to paragraph (e) of this Section to reimburse
the Issuing Bank shall be for the account of such Lender to the extent of such
payment.
(i) Replacement of the Issuing Bank. Any Issuing Bank may be replaced
--------------------------------
at any time by written agreement among the Cayman Borrower, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Lenders of any such replacement of the
Issuing Bank. At the time any such replacement shall become effective, the
Cayman Borrower shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank pursuant to Section 2.12(b). From and after the effective
date of any such replacement, (i) the successor Issuing Bank shall have all the
rights and obligations of the Issuing Bank under this Agreement with respect to
Letters of Credit to be issued thereafter and (ii) references herein to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall not be
required to issue additional Letters of Credit.
60
(j) Cash Collateralization. If any Event of Default shall occur and be
-----------------------
continuing, on the Business Day that the Cayman Borrower receives notice from
the Administrative Agent or the Required Lenders (or, if the maturity of the
Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the total LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Cayman Borrower shall deposit in an
account with the Administrative Agent, in the name of the Administrative Agent
and for the benefit of the Lenders, an amount in dollars and in cash equal to
the LC Exposure as of such date plus any accrued and unpaid interest thereon,
provided that (i) the portions of such amount attributable to undrawn
--------
Alternative Currency Letters of Credit or LC Disbursements in an Alternative
Currency that the Cayman Borrower is not late in reimbursing shall be deposited
in the applicable Alternative Currencies in the actual amounts of such undrawn
Letters of Credit and LC Disbursements and (ii) upon the occurrence of any Event
of Default with respect to the Cayman Borrower described in clause (h) or (i) of
Section 7.01 the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and payable
in dollars, without demand or other notice of any kind. For the purposes of this
paragraph, the Alternative Currency LC Exposure shall be calculated using the
Exchange Rates on the date notice demanding cash collateralization is delivered
to the Cayman Borrower. The Cayman Borrower also shall deposit cash collateral
pursuant to this paragraph as and to the extent required by Section 2.11(b).
Each such deposit pursuant to this paragraph or pursuant to Section 2.11(b)
shall be held by the Administrative Agent as collateral for the payment and
performance of the obligations of the Cayman Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Other than any interest earned
on the investment of such deposits, which investments shall be made at the
option and sole discretion of the Administrative Agent and at the Cayman
Borrower's risk and expense, such deposits shall not bear interest. Interest or
profits, if any, on such investments shall accumulate in such account. Moneys in
such account shall be applied by the Administrative Agent to reimburse the
Issuing Bank for LC Disbursements for which it has not been reimbursed and, to
the extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Cayman Borrower for the LC Exposure at such
time or, if the maturity of the Loans has been accelerated (but subject to the
consent of Revolving Lenders with LC Exposure representing greater than 50% of
the total LC Exposure), be applied to satisfy other obligations of the Cayman
Borrower
61
under this Agreement. If the Cayman Borrower is required to provide an amount of
cash collateral hereunder as a result of the occurrence of an Event of Default,
such amount (to the extent not applied as aforesaid) shall be returned to the
Cayman Borrower within three Business Days after all Events of Default have been
cured or waived. If the Cayman Borrower is required to provide an amount of cash
collateral hereunder pursuant to Section 2.11(b), such amount (to the extent not
applied as aforesaid) shall be returned to the Cayman Borrower as and to the
extent that, after giving effect to such return, the Cayman Borrower would
remain in compliance with Section 2.11(b) and no Event of Default shall have
occurred and be continuing.
(k) Conversion. In the event that the Loans become immediately due and
-----------
payable on any date pursuant to Section 7.01, all amounts (i) that the Cayman
Borrower is at the time or thereafter becomes required to reimburse or otherwise
pay to the Administrative Agent in respect of LC Disbursements made under any
Alternative Currency Letter of Credit (other than amounts in respect of which
the Cayman Borrower has deposited cash collateral pursuant to Section 2.05(j),
if such cash collateral was deposited in the applicable Alternative Currency to
the extent so deposited or applied), (ii) that the Revolving Lenders are at the
time or thereafter become required to pay to the Administrative Agent and the
Administrative Agent is at the time or thereafter becomes required to distribute
to the Issuing Bank pursuant to paragraph (e) of this Section in respect of
unreimbursed LC Disbursements made under any Alternative Currency Letter of
Credit and (iii) of each Revolving Lender's participation in any Alternative
Currency Letter of Credit under which an LC Disbursement has been made shall,
automatically and with no further action required, be converted into the Dollar
Equivalent, calculated using the Exchange Rates on such date (or in the case of
any LC Disbursement made after such date, on the date such LC Disbursement is
made), of such amounts. On and after such conversion, all amounts accruing and
owed to the Administrative Agent, the Issuing Bank or any Lender in respect of
the Obligations described in this paragraph shall accrue and be payable in
dollars at the rates otherwise applicable hereunder.
(l) The Cayman Borrower may, at any time and from time to time with
the consent of the Administrative Agent (which consent shall not be unreasonably
withheld) and such Revolving Lender, designate one or more additional Revolving
Lenders to act as an issuing bank under the terms of this Agreement, provided
--------
that the total number of Revolving Lenders so designated at any time plus the
total number of
62
Issuing Banks pursuant to clause (c) of the definition of the term "Issuing
Bank" at such time shall not exceed 6. Any Revolving Lender designated as an
Issuing Bank pursuant to this paragraph (l) shall be deemed to be an "Issuing
Bank" for the purposes of this Agreement (in addition to being a Revolving
Lender) with respect to Letters of Credit issued by such Revolving Lender.
(m) Each Issuing Bank will report in writing to the Administrative
Agent (i) on the first Business Day of each week, the aggregate face amount of
Letters of Credit issued by it and outstanding as of the last Business Day of
the preceding week, (ii) on or prior to each Business Day on which an Issuing
Bank expects to issue, amend, renew or extend any Letter of Credit, the date of
such issuance or amendment, and the aggregate face amount of Letters of Credit
to be issued, amended, renewed or extended by it and outstanding after giving
effect to such issuance, amendment, renewal or extension (and such Issuing Bank
shall advise the Administrative Agent on such Business Day whether such
issuance, amendment, renewal or extension occurred and whether the amount
thereof changed), (iii) on each Business Day on which an Issuing Bank makes any
LC Disbursement, the date of such LC Disbursement and the amount of such LC
Disbursement and (iv) on any Business Day on which the Cayman Borrower fails to
reimburse an LC Disbursement required to be reimbursed to such Issuing Bank on
such day, the date of such failure and amount of such LC Disbursement.
SECTION 2.06. Funding of Borrowings. (a) Each Lender shall make each
---------------------
Loan to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders, provided that Swingline Loans shall be made as provided
--------
in Section 2.04. The Administrative Agent will make such Loans available to the
applicable Borrower by promptly crediting the amounts so received, in like
funds, to an account of such Borrower maintained with the Administrative Agent
in New York City and designated by such Borrower in the applicable Borrowing
Request, provided that ABR Revolving Loans and Swingline Loans made to finance
--------
the reimbursement of an LC Disbursement as provided in Section 2.05(e) shall be
remitted by the Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such
63
Lender has made such share available on such date in accordance with paragraph
(a) of this Section and may, in reliance upon such assumption, make available to
the applicable Borrower a corresponding amount. In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the applicable Borrower
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including the
date such amount is made available to such Borrower to but excluding the date of
payment to the Administrative Agent, at (i) in the case of such Lender, the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of such Borrower, the interest rate applicable
to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.
(c) Nothing in this Section 2.06 shall be deemed to relieve any Lender
from its obligation to fulfill its Commitments hereunder or to prejudice any
rights that the Borrowers may have against any Lender as a result of any default
by any such Lender hereunder (it being understood, however, that no Lender shall
be responsible for the failure of any other Lender to fulfill its Commitments
hereunder).
SECTION 2.07. Interest Elections. (a) Each Revolving Borrowing and
------------------
Term Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an
initial Interest Period as specified in such Borrowing Request. Thereafter, the
applicable Borrower may elect to convert such Borrowing to a different Type or
to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The applicable
Borrower may elect different options with respect to different portions of the
affected Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding the Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing. This
Section shall not apply to Swingline Borrowings, which may not be converted or
continued.
(b) To make an election pursuant to this Section, the applicable
Borrower shall notify the Administrative Agent of such election by telephone by
the time that a Borrowing Request would be required under Section 2.03 if
64
such Borrower were requesting a Revolving Borrowing of the Type resulting from
such election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Interest Election Request in a form approved by the Administrative Agent and
signed by the applicable Borrower.
(c) Each telephonic and written Interest Election Request shall
specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and,
if different options are being elected with respect to different portions
thereof, the portions thereof to be allocated to each resulting Borrowing
(in which case the information to be specified pursuant to clauses (iii)
and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the applicable Borrower shall be deemed to
have selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the applicable Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Borrowing prior to the end of the
Interest Period applicable thereto, then, unless such Borrowing is repaid as
provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if
an Event
65
of Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the applicable Borrower, then, so
long as an Event of Default is continuing (i) no outstanding Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each
Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.
SECTION 2.08. Termination and Reduction of Commitments. (a) Unless
----------------------------------------
previously terminated, (i) the Term Loan Commitments shall terminate at 5:00
p.m., New York City time, on the Effective Date and (ii) the Revolving
Commitments shall terminate on the Revolving Maturity Date.
(b) The Cayman Borrower and the U.S. Borrower, as applicable, may,
without premium or penalty, at any time terminate, or from time to time reduce,
the Commitments of any Class, provided that (i) each reduction of the
--------
Commitments of any Class shall be in an amount that is an integral multiple of
$1,000,000 and not less than $5,000,000 and (ii) the Cayman Borrower shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.11,
the sum of the Revolving Exposures would exceed the total Revolving Commitments.
(c) The applicable Borrower shall notify the Administrative Agent of
any election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by
either of the Borrowers pursuant to this Section shall be irrevocable, provided
--------
that a notice of termination of the Revolving Commitments delivered by the
Cayman Borrower may state that such notice is conditioned upon the effectiveness
of other credit facilities, in which case such notice may be revoked by the
Cayman Borrower (by notice to the Administrative Agent on or prior to the
specified effective date) if such condition is not satisfied. Any termination or
reduction of the Commitments of any Class shall be permanent. Each reduction of
the Commitments of any Class shall be made ratably among the Lenders in
accordance with their respective Commitments of such Class.
SECTION 2.09. Repayment of Loans; Evidence of Debt. (a) The Borrowers
------------------------------------
hereby unconditionally promise to pay (i) to the Administrative Agent for the
account of each
66
Lender the then unpaid principal amount of each Revolving Loan of such Lender on
the Revolving Maturity Date, (ii) to the Administrative Agent for the account of
each Lender the then unpaid principal amount of each Term Loan of such Lender as
provided in Section 2.10 and (iii) to the Swingline Lender the then unpaid
principal amount of each Swingline Loan on the earlier of the Revolving Maturity
Date and the first date after such Swingline Loan is made that is the 15th or
last day of a calendar month and is at least five Business Days after such
Swingline Loan is made, provided that on each date that a Revolving Borrowing is
--------
made, the Cayman Borrower shall repay all Swingline Loans that were outstanding
on the date such Borrowing was requested.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of each Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Class and Type thereof
and the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from each Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof,
which accounts the Administrative Agent will make available to either Borrower
upon its reasonable request.
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be prima facie evidence of the existence and
----- -----
amounts of the obligations recorded therein, provided that the failure of any
--------
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrowers to repay
the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans of any Class made by it be
evidenced by a promissory note. In such event, the applicable Borrower shall
prepare, execute and deliver to such Lender a promissory note payable to the
order of such Lender (or, if requested by such Lender, to such Lender and its
registered assigns) and in a form approved by the Cayman Borrower and the
Administrative Agent. Thereafter, the Loans evidenced by such promissory
67
note and interest thereon shall at all times (including after assignment
pursuant to Section 9.04) be represented by one or more promissory notes in such
form payable to the order of the payee named therein (or, if such promissory
note is a registered note, to such payee and its registered assigns).
SECTION 2.10. Amortization of Term Loans. (a) Subject to adjustment
--------------------------
pursuant to paragraph (d) of this Section, the Cayman Borrower shall repay
Cayman Term Loans on each date set forth below in the aggregate principal amount
set forth opposite such date:
Date Amount
---- ------------
December 31, 2002 $ 1,250,025
June 30, 2003 $ 1,250,025
December 31, 2003 $ 1,250,025
June 30, 2004 $ 1,250,025
December 31, 2004 $ 1,250,025
June 30, 2005 $ 1,250,025
December 31, 2005 $ 1,250,025
June 30, 2006 $ 1,250,025
December 31, 2006 $120,002,400
Term Loan Maturity Date $120,002,400
(b) Subject to adjustment pursuant to paragraph (d) of this Section,
the U.S. Borrower shall repay U.S. Term Loans on each date set forth below in
the aggregate principal amount set forth opposite such date:
Date Amount
---- ------------
December 31, 2002 $ 499,975
June 30, 2003 $ 499,975
December 31, 2003 $ 499,975
June 30, 2004 $ 499,975
December 31, 2004 $ 499,975
June 30, 2005 $ 499,975
December 31, 2005 $ 499,975
June 30, 2006 $ 499,975
December 31, 2006 $47,997,600
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Date Amount
---- ------
Term Loan Maturity Date $47,997,600
(c) To the extent not previously paid, all Term Loans shall be due and
payable on the Term Loan Maturity Date.
(d) Any mandatory prepayment of a Term Borrowing shall be applied to
reduce the scheduled repayments of the Term Borrowings to be made pursuant to
this Section ratably. Any optional prepayment of a Term Borrowing pursuant to
Section 2.11(a) shall be applied to reduce the scheduled repayments of the Term
Borrowings to be made pursuant to this Section in order of maturity or ratably
at the Cayman Borrower's discretion. If the initial aggregate amount of the
Lenders' Term Commitments exceeds the aggregate principal amount of Term Loans
that are made on the Effective Date, then the scheduled repayments of Term
Borrowings to be made pursuant to this Section shall be reduced ratably by an
aggregate amount equal to such excess.
(e) Prior to any repayment of any portion of any Term Borrowings made
by either Borrower hereunder, the Borrowers shall select the Borrowing or
Borrowings to be repaid and shall notify the Administrative Agent by telephone
(confirmed by telecopy) of such selection not later than 11:00 a.m., New York
City time, three Business Days before the scheduled date of such repayment. Each
repayment of a portion of any Borrowing made by either Borrower shall be applied
ratably to the Loans of such Borrower included in the repaid Borrowing.
Repayments of Term Borrowings shall be accompanied by accrued interest on the
amount repaid.
SECTION 2.11. Prepayment of Loans. (a) Each Borrower shall have the
-------------------
right at any time and from time to time to prepay any Borrowing in whole or in
part, without premium or penalty (but subject to Section 2.16), subject to the
requirements of this Section.
(b) In the event and on each occasion that the sum of the Revolving
Exposures exceeds the total Revolving Commitments, the Cayman Borrower shall
prepay Revolving Borrowings or Swingline Borrowings (or, if no such Borrowings
are outstanding, deposit cash collateral in an account with the Administrative
Agent pursuant to Section 2.05(j)) in an aggregate amount equal to such excess.
(c) In the event and on each occasion that:
69
(i) the Cayman Borrower or Intermediate Holdings designates a portion
of Distributable Liquidity Event Proceeds resulting from an event described
in clauses (a) or (c) of the definition of the term Distributable Liquidity
Event Proceeds for use as described in Section 6.05(c)(iii)(B)(4) or
Section 6.05(c)(iv)(B)(4), the Cayman Borrower or Intermediate Holdings
shall, concurrently with the delivery of the certificate described in
Section 6.05(c)(iii) or Section 6.05(c)(iv), cause Term Loans in an
aggregate amount equal to the amount of such Distributable Liquidity Event
Proceeds being so designated to be prepaid using a portion of the Net
Proceeds (or cash received from the sale of Net Public Equity Proceeds
received by Intermediate Holdings from such Permitted Cayman Borrower
Equity Sale) of such event;
(ii) the Cayman Borrower designates a portion of Distributable
Liquidity Event Proceeds in respect of an event described in clause (b) of
the definition of the term Distributable Liquidity Event Proceeds for use
pursuant to Section 6.05(c)(iv)(B)(1) or 6.05(c)(iv)(B)(4), the Borrowers
shall, concurrently with the delivery of the certificate described in
Section 6.05(c)(iv), prepay Term Loans in an aggregate amount equal to the
amount of such Distributable Liquidity Event Proceeds being so designated
using a portion of the Net Proceeds of such event; and
(iii) Intermediate Holdings receives Net Proceeds in respect of an
event described in clause (d) of the definition of the term Distributable
Liquidity Event Proceeds and (x) such Net Proceeds are not contributed to
the Cayman Borrower within 30 days or (y) the Distributable Liquidity Event
Proceeds therefrom are designated for use pursuant to Section
6.05(c)(iii)(B)(1) or 6.05(c)(iii)(B)(4), Intermediate Holdings shall,
concurrently with the delivery of the certificate described in Section
6.05(c)(iii), cause Term Loans in an aggregate amount equal to the sum of
(x) the amount of Net Proceeds not contributed to the Cayman Borrower by
Intermediate Holdings and (y) the amount of Distributable Liquidity Event
Proceeds designated for use pursuant to Sections 6.05(c)(iii)(B)(1) and
6.05(c)(iii)(B)(4) to be prepaid using a portion of the Net Proceeds of
such event.
(d) Prior to any optional or mandatory prepayment of Borrowings
hereunder, the Borrowers shall select the Borrowing or Borrowings to be prepaid
and shall specify such
70
selection in the notice of such prepayment pursuant to paragraph (e) of this
Section. An amount equal to 71.43% of the portion of any optional or mandatory
prepayment of Term Borrowings shall be made by the Cayman Borrower in respect of
the Cayman Term Loans and an amount equal to 28.57% of the portion of any
optional or mandatory prepayment of Term Borrowings shall be made by the U.S.
Borrower in respect of the U.S. Term Loans.
(e) The Cayman Borrower shall notify the Administrative Agent (and, in
the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 1:00 p.m., New York City
time, three Business Days before the date of prepayment, (ii) in the case of
prepayment of an ABR Borrowing, not later than 2:00 p.m., New York City time,
one Business Day prior to the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 2:00 p.m., New York City time, on
the date of prepayment. Each such notice shall be irrevocable and shall specify
the prepayment date, the principal amount of each Borrowing or portion thereof
to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed
calculation of the amount of such prepayment, provided that, if a notice of
--------
optional prepayment of any Loans is given in connection with a conditional
notice of termination of the Revolving Commitments as contemplated by Section
2.08, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.08. Promptly following
receipt of any such notice (other than a notice relating solely to Swingline
Loans), the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02, except as necessary to apply fully the required amount
of a mandatory prepayment. Each prepayment of a portion of any Borrowing made by
either Borrower shall be applied ratably to the Loans of such Borrower included
in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest
to the extent required by Section 2.13.
SECTION 2.12. Fees. (a) The Cayman Borrower agrees to pay to the
----
Administrative Agent for the account of each Revolving Lender a commitment fee,
which shall accrue at the Applicable Margin on the average daily unused amount
of the Revolving Commitment of such Revolving Lender during the period from and
including the Effective Date to but excluding the date on which such Commitment
terminates. Accrued commitment fees shall be payable in arrears on the
71
last day of March, June, September and December of each year and on the date on
which the Revolving Commitments terminate, commencing on the first such date to
occur after the date hereof. All commitment fees shall be computed on the basis
of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). For purposes of computing
commitment fees, a Revolving Commitment of a Lender shall be deemed to be used
to the extent of the outstanding Revolving Loans and LC Exposure of such Lender
(and the Swingline Exposure of such Lender shall be disregarded for such
purpose).
(b) The Cayman Borrower agrees to pay (i) to the Administrative Agent
for the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Margin as interest on Eurodollar Revolving Loans on the average daily amount of
such Lender's LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender's
Revolving Commitment terminates and the date on which such Lender ceases to have
any LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue
at per annum rate, separately agreed upon between the Cayman Borrower and the
Issuing Bank, on the average daily amount of the LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements) during the period
from and including the Effective Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there ceases to
be any LC Exposure, as well as the Issuing Bank's standard fees with respect to
the issuance, amendment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. Participation fees and fronting fees accrued
through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Effective Date, provided
--------
that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
10 days after demand. All participation fees and fronting fees shall be computed
on the basis of a year of 360 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). For the
purposes of calculating the average daily amount of the LC Exposure for any
period
72
under this Section 2.12(b), the average daily amount of the Alternative Currency
LC Exposure for such period shall be calculated by multiplying (x) the average
daily balance of each Alternative Currency Letter of Credit (expressed in the
currency in which such Alternative Currency Letter of Credit is denominated) by
(y) the Exchange Rate for each such Alternative Currency in effect on the last
Business Day of such period or by such other reasonable method that the
Administrative Agent deems appropriate.
(c) The Cayman Borrower agrees to pay to the Administrative Agent, for
its own account, fees payable in the amounts and at the times separately agreed
upon between the Cayman Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds in dollars, to the Administrative Agent (or to the
Issuing Bank, in the case of fees payable to it) for distribution, in the case
of commitment fees and participation fees, to the Lenders entitled thereto. Fees
paid shall not be refundable under any circumstances.
SECTION 2.13. Interest. (a) The Loans comprising each ABR Borrowing
--------
(including each Swingline Loan) shall bear interest at the Alternate Base Rate
plus the Applicable Margin.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest
at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Applicable Margin.
(c) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrowers hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, to the
fullest extent permitted by applicable law, at a rate per annum equal to (i) in
the case of overdue principal of any Loan, 2% plus the rate otherwise applicable
to such Loan as provided in the preceding paragraphs of this Section or (ii) in
the case of any other amount, 2% plus the rate applicable to ABR Revolving Loans
as provided in paragraph (a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears (i) on
each Interest Payment Date for such Loan, (ii) in the case of Revolving Loans,
upon termination of the Revolving Commitments and (iii) in the case of Term
Loans, on the Term Loan Maturity Date, provided
--------
73
that (i) interest accrued pursuant to paragraph (c) of this Section shall be
payable on demand, (ii) in the event of any repayment or prepayment of any Loan
(other than a prepayment of an ABR Revolving Loan prior to the end of the
Revolving Availability Period), accrued interest on the principal amount repaid
or prepaid shall be payable on the date of such repayment or prepayment and
(iii) in the event of any conversion of any Eurodollar Loan prior to the end of
the current Interest Period therefor, accrued interest on such Loan shall be
payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate
at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate or
Adjusted LIBO Rate shall be determined by the Administrative Agent in accordance
with the terms hereof, and such determination shall be prima facie evidence
thereof.
SECTION 2.14. Alternate Rate of Interest. If prior to the commencement
--------------------------
of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be
prima facie evidence thereof) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their
Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Cayman Borrower
and the Lenders by telephone or telecopy as promptly as practicable thereafter
and, until the Administrative Agent notifies the Cayman Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist (it being
understood that the Administrative Agent will use commercially reasonable
efforts to give such notice as soon as practicable after such circumstances no
longer exist), (i) any Interest Election Request that
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requests the conversion of any Borrowing to, or continuation of any Borrowing
as, a Eurodollar Borrowing shall be ineffective and (ii) if any Borrowing
Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing.
SECTION 2.15. Increased Costs. (a) If any Change in Law (except with
---------------
respect to Taxes which shall be governed by Section 2.17) shall:
(i) impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of,
or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London interbank
market any other condition affecting this Agreement or Eurodollar Loans
made by such Lender or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
applicable Borrower will pay to such Lender or the Issuing Bank, as the case may
be, such additional amount or amounts as will compensate such Lender or the
Issuing Bank, as the case may be, for such additional costs incurred or
reduction suffered.
(b) If any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on a Lender's or the Issuing
Bank's capital or on the capital of such Lender's or the Issuing Bank's holding
company, if any, as a consequence of this Agreement or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the Issuing Bank, to a level below that which such Lender or
the Issuing Bank or such Lender's or the Issuing Bank's holding company could
have achieved but for such Change in Law (taking into consideration such
Lender's or the Issuing Bank's policies and the policies of such Lender's or the
Issuing Bank's holding company with respect to capital adequacy), then from time
to time the applicable Borrower
75
will pay to such Lender or the Issuing Bank, as the case may be, such additional
amount or amounts as will compensate such Lender or the Issuing Bank or such
Lender's or the Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section, and setting forth in reasonable detail the basis on which such
amount or amounts were calculated and stating that such calculation has been
made in a manner consistent with the treatment given by such Lender or Issuing
Bank to similar businesses in similar circumstances, shall be delivered to the
Cayman Borrower and shall be prima facie evidence thereof. The applicable
Borrower shall pay such Lender or the Issuing Bank, as the case may be, the
amount shown as due on any such certificate within 15 days after receipt
thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation, provided
--------
that the Borrowers shall not be required to compensate a Lender or the Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or the Issuing Bank, as
the case may be, notifies the Cayman Borrower of the Change in Law giving rise
to such increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor, and provided further that, if the
-------- -------
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof.
SECTION 2.16. Break Funding Payments. In the event of (a) the payment
----------------------
of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Eurodollar Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.11(e) and is revoked in accordance therewith) or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the
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Cayman Borrower pursuant to Section 2.19, then, in any such event, the
applicable Borrower shall compensate each Lender for the loss (other than lost
profits), cost and expense attributable to such event. In the case of a
Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount reasonably determined by such Lender to be the excess, if any,
of (i) the amount of interest that would have accrued on the principal amount of
such Loan had such event not occurred, at the Adjusted LIBO Rate that would have
been applicable to such Loan, for the period from the date of such event to the
last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest that would
accrue on such principal amount for such period at the interest rate that such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section, and setting forth
in reasonable detail the basis on which such amount or amounts were calculated,
shall be delivered to the Cayman Borrower and shall be prima facie evidence
thereof. The applicable Borrower shall pay such Lender the amount shown as due
on any such certificate within 15 days after receipt thereof.
SECTION 2.17. Taxes. (a) Any and all payments by or on account of any
-----
obligation of either Borrower hereunder or under any other Loan Document shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes, provided that if either Borrower shall be required to deduct any
--------
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Bank (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the applicable Borrower shall make such deductions and (iii) the
applicable Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, the applicable Borrower shall pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
(c) The applicable Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank,
77
within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent, such Lender
or the Issuing Bank, as the case may be, on or with respect to any payment by or
on account of any obligation of such Borrower hereunder or under any other Loan
Document (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability delivered to the Cayman Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a
Lender or the Issuing Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by either Borrower to a Governmental Authority, the applicable
Borrower shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender (or Participant) that is entitled to an
exemption from or reduction of withholding tax under the law of the jurisdiction
in which a Borrower is located, or under any treaty to which such jurisdiction
is a party, with respect to payments under this Agreement shall deliver to the
Borrowers (with a copy to the Administrative Agent) (or in the case of a
Participant, to the Foreign Lender from which the related participation was
purchased), at the time or times prescribed by applicable law, such properly
completed and executed documentation prescribed by applicable law or reasonably
requested by such Borrower as will permit such payments to be made without
withholding or at a reduced rate, provided that, with respect to such
--------
documentation provided to the Cayman Borrower, such Foreign Lender (or
Participant) has received written notice from the Cayman Borrower advising it of
the availability of such exemption or reduction and supplying all applicable
documentation. In addition, each Foreign Lender (or Participant) shall deliver
substitute forms promptly upon the obsolescence or invalidity of any form
previously delivered by such Foreign Lender (or Participant), provided that,
--------
with respect to such documentation provided to the Cayman Borrower, such Foreign
Lender (or Participant) has
78
received written notice from the Cayman Borrower advising it of such
obsolescence and supplying such substitute forms.
(f) If the Administrative Agent or a Lender or the Issuing Bank
determines, in its sole discretion, that it has received a refund of any Taxes
as to which it has been indemnified by either Borrower or with respect to which
either Borrower has paid additional amounts pursuant to this Section 2.17, which
the Administrative Agent or such Lender or the Issuing Bank is able to identify
as such, it shall pay such refund to such Borrower (but only to the extent of
indemnity payments made, or additional amounts paid, by such Borrower under this
Section 2.17 with respect to the Taxes giving rise to such refund), net of all
reasonable out-of-pocket expenses of the Administrative Agent or such Lender or
the Issuing Bank and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund); provided, however,
that each Borrower agrees to pay, upon the request of the Administrative Agent
or such Lender or the Issuing Bank, the amount paid to such Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent or such Lender or the Issuing Bank in the
event the Administrative Agent or such Lender or the Issuing Bank is required to
repay such refund to such Governmental Authority. Nothing contained in this
Section 2.17(f) shall require the Administrative Agent or any Lender or the
Issuing Bank to make available its tax returns (or any other information
relating to its Taxes that it deems confidential) to either Borrower or any
other Person.
SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of
--------------------------------------------------
Set-offs. (a) Each Borrower shall make each payment required to be made by it
--------
hereunder or under any other Loan Document (whether of principal, interest, fees
or reimbursement of LC Disbursements, or of amounts payable under Section 2.15,
2.16 or 2.17, or otherwise) prior to the time expressly required hereunder or
under such other Loan Document for such payment (or, if no such time is
expressly required, prior to 2:00 p.m., New York City time), on the date when
due, in immediately available funds, without set-off or counterclaim. Any
amounts received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, except payments to be made directly to the Issuing Bank or
Swingline Lender as expressly provided herein and except that payments pursuant
79
to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein. The Administrative Agent shall distribute any
such payments received by it for the account of any other Person to the
appropriate recipient promptly following receipt thereof. If any payment under
any Loan Document shall be due on a day that is not a Business Day, the date for
payment shall be extended to the next succeeding Business Day, and, in the case
of any payment accruing interest, interest thereon shall be payable for the
period of such extension. Except as provided in Section 2.05(e), all payments
under each Loan Document shall be made in dollars.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
and unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans, Term Loans or participations in LC
Disbursements or Swingline Loans resulting in such Lender receiving payment of a
greater proportion of the aggregate amount of its Revolving Loans, Term Loans
and participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans, provided that (i) if any such participations
--------
are purchased and all or any portion of the payment giving rise thereto is
recovered, such participations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the
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Borrowers pursuant to and in accordance with the express terms of this Agreement
or any payment obtained by a Lender as consideration for the assignment of or
sale of a participation in any of its Loans or participations in LC
Disbursements to any assignee or participant, other than to a Borrower or any
Subsidiary or Affiliate thereof (as to which the provisions of this paragraph
shall apply). The Borrowers consent to the foregoing and agree, to the extent
they may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against each
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Borrower in the amount
of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Cayman Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the applicable Borrower will not make such payment, the
Administrative Agent may assume that such Borrower has made such payment on such
date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders or the Issuing Bank, as the case may be, the amount
due. In such event, if the applicable Borrower has not in fact made such
payment, then each of the Lenders or the Issuing Bank, as the case may be,
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender or Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.04(c), 2.05(d) or (e), 2.06(b), 2.18(d) or 9.03(c),
then the Administrative Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.19. Mitigation Obligations; Replacement of Lenders. (a) If
----------------------------------------------
any Lender requests compensation under Section 2.15, or if either Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to
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Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the reasonable judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.15 or 2.17, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if
either Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Cayman Borrower may, at its sole expense and effort, upon notice to such Lender
and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that (i) the Cayman
--------
Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Commitment is being assigned, the Issuing Bank and
Swingline Lender), which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements and Swingline
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or either Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.15 or payments required to be made pursuant to
Section 2.17, such assignment will result in a material reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the applicable Borrower to
require such assignment and delegation cease to apply. Nothing in this Section
2.19 shall be deemed to prejudice any rights that either Borrower may have
against any Lender as a result of any default by any such Lender in its
obligations to fund Loans hereunder.
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SECTION 2.20. Change in Law. Notwithstanding any other provision of
-------------
this Agreement, if, after the date hereof, (i) any Change in Law shall make it
unlawful for any Issuing Bank to issue Letters of Credit denominated in an
Alternative Currency, or (ii) there shall have occurred any change in national
or international financial, political or economic conditions (including the
imposition of or any change in exchange controls) or currency exchange rates
that would make it impracticable for any Issuing Bank to issue Letters of Credit
denominated in such Alternative Currency for the account of the Cayman Borrower,
then by prompt written notice thereof to the Cayman Borrower and to the
Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), such Issuing Bank may declare that Letters of
Credit will not thereafter be issued by it in the affected Alternative Currency
or Alternative Currencies, whereupon the affected Alternative Currency or
Alternative Currencies shall be deemed (for the duration of such declaration)
not to constitute an Alternative Currency for purposes of the issuance of
Letters of Credit by such Issuing Bank.
ARTICLE III
Representations and Warranties
------------------------------
Each of Intermediate Holdings and the Borrowers represents and
warrants to the Lenders with respect to itself and its subsidiaries that:
SECTION 3.01. Organization; Powers. Each of Intermediate Holdings, the
--------------------
Borrowers and the Subsidiaries is duly incorporated or organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization or incorporation, has all requisite power and authority to carry on
its business as now conducted and, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required.
SECTION 3.02. Authorization; Enforceability. The Transactions to be
-----------------------------
entered into by each Loan Party are within such Loan Party's powers and have
been duly authorized by all necessary action. This Agreement has been duly
executed and delivered by each of Intermediate Holdings and the Borrowers and
constitutes, and each other Loan Document to which any Loan Party (other than a
Subsidiary Loan Party that is a Subsidiary Loan Party solely pursuant
83
to clause (b) of the definition of the term "Subsidiary Loan Party") is to be a
party, when executed and delivered by such Loan Party, will constitute, a legal,
valid and binding obligation of Intermediate Holdings, such Borrower or such
Loan Party (as the case may be), enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws affecting creditors' rights generally
and to general principles of equity and an implied covenant of good faith and
fair dealing, regardless of whether considered in a proceeding in equity or at
law.
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
------------------------------------
(a) do not require any consent or approval of, registration or filing with, or
any other action by or before, any Governmental Authority, except such as have
been obtained or made and are in full force and effect and except filings
necessary to perfect Liens created under the Loan Documents and, except where
the failure to obtain such consent or approval or to make such registration or
filing, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect, (b) will not violate any applicable law or
regulation in any material respect or the memorandum and articles of
association, charter, by-laws or other organizational documents of Intermediate
Holdings, either Borrower or any of the Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, material agreement or other material instrument binding upon
Intermediate Holdings, either Borrower or any of the Subsidiaries or any of
their assets, or give rise to a right thereunder to require any payment to be
made by Intermediate Holdings, either Borrower or any of the Subsidiaries,
except for violations or payments that, individually and in the aggregate, could
not reasonably be expected to have a Material Adverse Effect, and (d) will not
result in the creation or imposition of any Lien on any asset of Intermediate
Holdings, either Borrower or any of the Subsidiaries, except Liens created under
the Loan Documents.
SECTION 3.04. Financial Condition; No Material Adverse Change. (a)
-----------------------------------------------
Intermediate Holdings has heretofore furnished to the Lenders (i)(x) the
consolidated and combined statements of operations, stockholders' equity and
cash flows of Intermediate Holdings and its predecessor as of and for the fiscal
years ended July 2, 1999 and June 30, 2000, for the period from July 1, 2000 to
November 22, 2000, and for the period from November 23, 2000, to June 29, 2001,
and (y) the consolidated and combined balance sheets of Intermediate Holdings as
of June 30, 2000, and June 30,
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2001, in each case reported on by Ernst & Young LLP, independent auditors and
(ii) selected unaudited consolidated financial information of the Cayman
Borrower and its predecessor, which includes the line-items specified on
Schedule 5.01, as of and for the fiscal years ended July 2, 1999, June 30, 2000,
and combined for the 12 months ended June 29, 2001, in each case with procedures
performed by Ernst & Young LLP, independent auditors, in accordance with
Statement on Auditing Standards No. 72 and accompanied by a customary letter to
such effect. Such financial statements of Intermediate Holdings present fairly,
in all material respects, the consolidated financial position and results of
operations and cash flows of Intermediate Holdings as of such dates and for such
periods in accordance with GAAP.
(b) Intermediate Holdings has heretofore furnished to the Lenders
(i)(x) the unaudited consolidated statements of income, stockholders' equity and
cash flows of Intermediate Holdings as of and for the nine months ended March
30, 2001, and March 29, 2002, and (y) the consolidated balance sheets of
Intermediate Holdings as of March 30, 2001, and March 29, 2002, and (ii)
selected unaudited consolidated financial information of the Cayman Borrower,
which includes the line-items specified on Schedule 5.01, as of and for the nine
months ended March 30, 2001, and March 29, 2002.
(c) Intermediate Holdings has heretofore furnished to the Lenders its
pro forma capitalization table as of March 29, 2002, prepared giving effect to
the Transactions as if the Transactions had occurred on such date. Such pro
forma capitalization table (i) has been prepared in good faith based on
assumptions made known to the Lenders (which assumptions are believed by
Intermediate Holdings and the Borrowers to be reasonable at the time of
preparation) and upon information not known to be incorrect or unreasonable in
any material respect and (ii) accurately reflect in all material respects all
adjustments necessary to give effect to the Transactions.
(d) Except as disclosed in the financial statements referred to in
paragraphs (a), (b) and (c) above or the notes thereto or in the Information
Memorandum and except for the Disclosed Matters, after giving effect to the
Transactions, none of Intermediate Holdings, the Borrowers or the Subsidiaries
has, as of the Effective Date, any material contingent liabilities, unusual
long-term commitments or unrealized losses.
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(e) Since June 30, 2001, there has been no material adverse change in
the business, financial condition or results of operations of Intermediate
Holdings, the Borrowers and the Subsidiaries, taken as a whole.
SECTION 3.05. Properties. (a) Intermediate Holdings, each Borrower and
----------
each of the Subsidiaries has good title to, or valid leasehold interests in, all
its real and personal property material to its business (including its Mortgaged
Properties), except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes and subject to Permitted Encumbrances.
(b) Intermediate Holdings, each Borrower and each of the Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and
other intellectual property material to its business, and the use thereof by
Intermediate Holdings, the Borrowers and the Subsidiaries does not infringe upon
the rights of any other Person, except for any such infringements that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
(c) Schedule 3.05(c) sets forth the address of each real property that
is owned or leased by either Borrower or any of the Subsidiaries as of the
Effective Date after giving effect to the Transactions.
(d) As of the Effective Date, none of Intermediate Holdings, either
Borrower or any of the Subsidiaries has received notice of, or has knowledge of,
any material pending or contemplated condemnation proceeding affecting any
Mortgaged Property or any sale or disposition thereof in lieu of condemnation.
Neither any Mortgaged Property nor any interest therein is subject to any right
of first refusal, option or other contractual right to purchase such Mortgaged
Property or interest therein.
SECTION 3.06. Litigation and Environmental Matters. (a) Except for the
------------------------------------
Disclosed Matters, there are no actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of
Intermediate Holdings or the Borrowers, threatened against or affecting
Intermediate Holdings, either Borrower or any of the Subsidiaries (i) that could
reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect or (ii)(x) that involve any of the Loan Documents or the
Transactions, (y) that are not frivolous and (z) if adversely determined, would
86
reasonably be expected to be adverse to the interests of the Lenders.
(b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, none of Intermediate Holdings,
either Borrower or any of the Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become subject to
any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
(c) Since the date of this Agreement, there has been no change in the
status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.
SECTION 3.07. Compliance with Laws and Agreements. Each of
-----------------------------------
Intermediate Holdings, the Borrowers and the Subsidiaries is in compliance with
all laws, regulations and orders of any Governmental Authority applicable to it
or its property and all indentures, agreements and other instruments binding
upon it or its property, except where the failure to do so, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No Default has occurred and is continuing.
SECTION 3.08. Investment and Holding Company Status. None of
-------------------------------------
Intermediate Holdings, either Borrower or any of the Subsidiaries is (a) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
SECTION 3.09. Taxes. Intermediate Holdings, each Borrower and each of
-----
the Subsidiaries has timely filed or caused to be filed all Tax returns and
reports required to have been filed and has paid or caused to be paid all Taxes
required to have been paid by it, except (a) any Taxes that are being contested
in good faith by appropriate proceedings and for which Intermediate Holdings,
such Borrower or such Subsidiary, as applicable, has set aside on its books
adequate reserves or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
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SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
-----
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, would reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under all underfunded Plans (based on the assumptions used
for purposes of Statement of Financial Accounting Standards No. 87) did not, as
of the date of the most recent financial statements reflecting such amounts,
exceed the fair market value of the assets of all such underfunded Plans by an
amount that, if it were required to be fully paid, would reasonably be expected
to result in a Material Adverse Effect. Neither of the Borrowers nor any of the
ERISA Affiliates has engaged in a transaction with respect to any employee
benefit plan that would reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.11. Disclosure. Intermediate Holdings and the Borrowers have
----------
disclosed to the Lenders all agreements, instruments and corporate or other
restrictions to which Intermediate Holdings, either Borrower or any of the
Subsidiaries is subject, and all other matters known to any of them, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. The Information Memorandum and the other reports,
financial statements, certificates or other information furnished by or on
behalf of any Loan Party to the Administrative Agent or any Lender in connection
with the negotiation of this Agreement or any other Loan Document or delivered
hereunder or thereunder (as modified or supplemented by other information so
furnished), taken as a whole, do not contain any material misstatement of fact
or omit to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
provided that, (a) with respect to projected financial information, Intermediate
--------
Holdings and the Borrowers represent only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time and (b)
with respect to information regarding the hard disc drive market and other
industry data, Intermediate Holdings and the Borrowers represent only that such
information was prepared by third-party industry research firms, and although
Intermediate Holdings and the Borrowers believe such information is reliable,
Intermediate Holdings and the Borrowers cannot guarantee the accuracy and
completeness of the information and have not independently verified such
information.
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SECTION 3.12. Subsidiaries. Schedule 3.12 sets forth the name of, and
------------
the ownership interest of Intermediate Holdings, each Borrower and each
Subsidiary in, each Subsidiary and identifies each Subsidiary that is a
Subsidiary Loan Party, in each case as of the Effective Date.
SECTION 3.13. Insurance. Schedule 3.13 sets forth a description of all
---------
insurance maintained by or on behalf of Intermediate Holdings, the Borrowers and
the Subsidiaries as of the Effective Date. As of the Effective Date, all
premiums in respect of such insurance that are required to have been paid have
been paid. Intermediate Holdings and the Borrowers believe that the insurance
maintained by or on behalf of Intermediate Holdings, the Borrowers and the
Subsidiaries is adequate in all material respects.
SECTION 3.14. Labor Matters. As of the Effective Date, there are no
-------------
material strikes, lockouts or slowdowns against Intermediate Holdings, either
Borrower or any Subsidiary pending or, to the knowledge of Intermediate Holdings
or the Borrowers, threatened. Except as could not be reasonably expected to
result in a Material Adverse Effect, (a) the hours worked by and payments made
to employees of Intermediate Holdings, the Borrowers and the Subsidiaries have
not been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters, (b) all payments
due from Intermediate Holdings, either Borrower or any Subsidiary, or for which
any claim may be made against Intermediate Holdings, either Borrower or any
Subsidiary, on account of wages and employee health and welfare insurance and
other benefits, have been paid or accrued as a liability on the books of
Intermediate Holdings, such Borrower or such Subsidiary and (c) the consummation
of the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which Intermediate Holdings, either Borrower or any Subsidiary is bound.
SECTION 3.15. Solvency. Immediately after the consummation of the
--------
Transactions to occur on the Effective Date and immediately following the making
of each Loan made on the Effective Date and after giving effect to the
application of the proceeds of such Loans, (a) the fair value of the assets
(including all rights under the Indemnity, Subrogation and Contribution
Agreement and any similar agreement) of each Core Loan Party, at a fair
valuation, will exceed its debts and liabilities, subordinated, contingent or
otherwise; (b) the present fair
89
saleable value of the property of each Core Loan Party will be greater than the
amount that will be required to pay the probable liability of its debts and
other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (c) each Core Loan Party will be
able to pay its debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (d) each Core Loan
Party will not have unreasonably small capital with which to conduct the
business in which it is engaged as such business is now conducted and is
proposed to be conducted following the Effective Date.
SECTION 3.16. Senior Indebtedness. The Obligations constitute "Senior
-------------------
Indebtedness" under and as defined in the Existing Subordinated Debt Documents
and the Senior Note Documents.
ARTICLE IV
Conditions
----------
SECTION 4.01. Effective Date. The obligations of the Lenders to make
--------------
Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not
become effective until the date on which each of the following conditions is
satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received from
each party hereto either (i) a counterpart of this Agreement signed on
behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a signed
signature page of this Agreement) that such party has signed a counterpart
of this Agreement.
(b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated
the Effective Date) of each of (i)(A) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, United
States counsel for the Borrowers, substantially in the form of Exhibit
B-1(A) and (B) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, General Counsel of Intermediate Holdings,
substantially in the form of Exhibit B-1(B), (ii) Walkers, Cayman Islands
counsel for the Borrowers, substantially in the form of Exhibit B-2, (iii)
▇▇▇ & ▇▇▇, Singapore counsel for the Borrowers, substantially in the form
of Exhibit B-3, (iv) L'Estrange & ▇▇▇▇▇ Solicitors, Northern Ireland
counsel for the Borrowers,
90
substantially in the form of Exhibit B-4, (v) ▇▇▇▇▇▇▇▇ Chance, Netherlands
counsel for the Borrowers, substantially in the form of Exhibit B-5, (vi)
United States local counsel in each jurisdiction where a Mortgaged Property
is located, substantially in the form of Exhibit ▇-▇, (▇▇▇) ▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ counsel for the Administrative Agent, substantially in the form of
Exhibit B-7, (viii) ▇▇▇▇▇▇▇▇ Chance, Japanese counsel for the Borrowers,
substantially in the form of Exhibit B-8, (ix) ▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
Mexican counsel for the Borrowers, substantially in the form of Exhibit
B-9, (x) ▇▇▇▇▇▇▇ ▇▇▇▇▇, English counsel for the Administrative Agent,
substantially in the form of Exhibit B-10 and (xi) ▇▇▇▇▇▇▇▇ Chance Wirot
Limited, Thai counsel for the Borrowers, substantially in the form of
Exhibit B-11, and, in the case of each such opinion required by this
paragraph, covering such other matters relating to the Loan Parties, the
Loan Documents or the Transactions as the Required Lenders shall reasonably
request. Each of Intermediate Holdings and the Borrowers hereby requests
such counsel to deliver such opinions.
(c) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization or incorporation, existence and good
standing of each Loan Party, the authorization of the Transactions and any
other legal matters relating to the Loan Parties, the Loan Documents or the
Transactions, all in form and substance reasonably satisfactory to the
Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a certificate, dated
the Effective Date and signed by the President, a Vice President or a
Financial Officer of the Cayman Borrower, confirming compliance with the
conditions set forth in paragraphs (a) and (b) of Section 4.02.
(e) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Effective Date, including, to
the extent invoiced, reimbursement or payment of all reasonable
out-of-pocket expenses (including reasonable fees, charges and
disbursements of counsel) required to be reimbursed or paid by any Loan
Party hereunder or under any other Loan Document.
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(f) The requirements set forth in paragraphs (a), (e), (f), (g), (h)
and (i) of the Collateral and Guarantee Requirement shall have been
satisfied and the Administrative Agent shall have received (i) a completed
Perfection Certificate dated the Effective Date and signed by an executive
officer or Financial Officer of the Cayman Borrower, together with all
attachments contemplated thereby, including the results of a search of the
Uniform Commercial Code (or equivalent) filings made with respect to the
Loan Parties in the jurisdictions contemplated by the Perfection
Certificate and copies of the financing statements (or similar documents)
disclosed by such search and evidence reasonably satisfactory to the
Administrative Agent that the Liens indicated by such financing statements
(or similar documents) are permitted by Section 6.02 or have been or
simultaneously are being released, provided that to the extent that it is
--------
not practicable (x) for any Foreign Subsidiary to satisfy clause (i) of
paragraph (a) of the Collateral and Guarantee Requirement,(y) to perfect
any security interest as provided in the Collateral and Guarantee
Requirement or (z) to deliver an opinion of counsel relating to clauses (x)
or (y) above, in each case prior to the Effective Date, such requirements
may be satisfied after the Effective Date in accordance with Section
5.13(a).
(g) The Administrative Agent shall have received evidence that the
insurance required by Section 5.07 and the Security Documents is in effect.
(h) STI shall have purchased not less than a majority in aggregate
principal amount of the Existing Subordinated Debt outstanding on the
Effective Date pursuant to the Debt Tender Offer and all the significant
negative covenants in the Existing Subordinated Debt Documents shall have
been eliminated. The terms and conditions of the Debt Tender Offer, the
Debt Tender Materials and all other material documentation related thereto
shall be reasonably satisfactory to the Administrative Agent.
(i) The Cayman Borrowers shall have issued the Senior Notes for cash.
The terms and conditions of the Senior Notes and the provisions of the
Senior Note Documents and all other material documentation related thereto
shall be reasonably satisfactory to the Administrative Agent. The
Administrative Agent shall have received copies of the Senior Note
Documents, certified by a Financial Officer of the Cayman Borrower
92
as complete and correct. After giving effect to the issuance of the Senior
Notes and the consummation of the Debt Tender Offer, the aggregate
principal amount of Permitted High-Yield Indebtedness outstanding shall not
be less than $400,000,000.
(j) All amounts outstanding under the Existing Credit Agreement shall
have been repaid in full and the Administrative Agent shall have received
reasonably satisfactory documentation evidencing the termination of the
Existing Credit Agreement and each agreement related thereto, the release
of all liens granted thereunder and the discharge of all obligations
thereunder.
(k) The Administrative Agent shall have received a pro forma
capitalization table of Intermediate Holdings dated as of March 29, 2002,
reflecting all pro forma adjustments as if the Transactions and the other
transactions contemplated hereby had been consummated on such date. The
Administrative Agent shall be reasonably satisfied that such balance sheet
and the transactions in connection with the Transactions and the financing
arrangements contemplated hereby are not materially inconsistent with the
information or projections and the financial model delivered to the
Administrative Agent prior to the date hereof.
(l) After giving effect to the Transactions, (i) neither Borrower nor
any of the Subsidiaries shall have outstanding any preferred stock (other
than any shares set forth on Schedule 3.12) or any Indebtedness, other than
(A) Indebtedness incurred under the Loan Documents, (B) the Permitted
High-Yield Indebtedness and (C) the Indebtedness set forth in Schedule
6.01, (ii) the U.S. Borrower shall have outstanding no common stock other
than common stock owned by the Cayman Borrower, (iii) the Cayman Borrower
shall have outstanding no ordinary shares other than ordinary shares owned
by Intermediate Holdings and (iv) Intermediate Holdings shall have
outstanding (A) no ordinary shares other than ordinary shares owned by
Holdings and ordinary shares issued upon exercise of Permitted Options to
Permitted Optionholders and (B) no Indebtedness or preferred stock other
than (x) its Guarantee of the Obligations, (y) its Guarantees of the
Permitted High-Yield Indebtedness and (z) 400,000,000 shares of Series A
Preferred Stock owned by Holdings.
(m) As of the Effective Date, after giving effect to the Transactions
(including the Holdings
93
Distribution), the ratio of (i) the Cash Amount to (ii) Material Funded
Indebtedness shall not be less than 1.0 to 1.0 and the Administrative Agent
shall have received a certificate from a Financial Officer of Intermediate
Holdings or the Cayman Borrower that (x) sets forth, in reasonable detail,
the calculation of the amount of the Holdings Distribution, (y) certifies
compliance by the Borrowers with the ratio set forth above and (z)
certifies that the cash used to pay the Holdings Distribution was generated
in the ordinary course of the Borrowers' business.
(n) The Administrative Agent shall be reasonably satisfied that (i) no
legal or other restrictions exist that would prevent the transfer to the
Borrowers by the Subsidiaries of the funds required to service the
Indebtedness to be incurred under the Loan Documents, the Existing
Subordinated Debt Documents and the Senior Note Documents and (ii) the
Transaction Costs shall not exceed $25,000,000.
The Administrative Agent shall notify the Cayman Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans and of the Issuing
Bank to issue Letters of Credit hereunder shall not become effective unless each
of the foregoing conditions is satisfied (or waived pursuant to Section 9.02) at
or prior to 5:00 p.m., New York City time, on July 31, 2002, (and, in the event
such conditions are not so satisfied or waived, the Commitments shall terminate
at such time).
SECTION 4.02. Each Credit Event. The obligation of each Lender to make
-----------------
a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue,
amend, renew or extend any Letter of Credit, is subject to receipt of the
request therefor in accordance herewith and to the satisfaction of the following
conditions:
(a) The representations and warranties of each Loan Party set forth in
the Loan Documents shall be true and correct in all material respects on
and as of the date of such Borrowing or the date of issuance, amendment,
renewal or extension of such Letter of Credit, as applicable, except to the
extent (i) such representations and warranties expressly relate to an
earlier date (in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date) or (ii)
such representations and warranties are made by, or relate
94
to, Intermediate Holdings and Intermediate Holdings is no longer a Loan
Party.
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default shall have occurred and be continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by
Intermediate Holdings (for so long as it is a Loan Party) and each Borrower on
the date thereof as to the matters specified in paragraphs (a) and (b) of this
Section. For purposes of the foregoing, the term "Borrowing" shall not include
the continuation or conversion of Loans in which the aggregate amount of such
Loans is not being increased.
ARTICLE V
Affirmative Covenants
---------------------
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, each of Intermediate Holdings
(for so long as it is a Loan Party) and each Borrower covenants and agrees with
the Lenders that:
SECTION 5.01. Financial Statements and Other Information. For so long
-------------------------------------------
as it is a Loan Party, Intermediate Holdings will and, after Intermediate
Holdings ceases to be a Loan Party, the Cayman Borrower will furnish to the
Administrative Agent:
(a) within 90 days after the end of each fiscal year of Intermediate
Holdings or the Cayman Borrower, as applicable, (i) its audited
consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows as of the end of and for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all reported on by Ernst & Young or other independent public
accountants of recognized national standing (without a "going concern" or
like qualification or exception and without any qualification or exception
as to the scope of such
95
audit or any other material qualification or exception) to the effect that
such consolidated financial statements present fairly in all material
respects the consolidated financial condition and results of operations of
Intermediate Holdings (for so long as it is a Loan Party), the Borrowers
and the consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied and (ii) selected unaudited consolidated
financial information of the Cayman Borrower, which will include the
line-items set forth on Schedule 5.01, with procedures performed by Ernst &
Young LLP or other independent auditors of recognized national standing in
accordance with Statement on Auditing Standards No. 72 and accompanied by a
customary letter to such effect from such auditors; provided that, if
--------
Intermediate Holdings ceases to be a Loan Party, the Cayman Borrower will
furnish the information required by clause (i) (but not clause (ii)) with
respect to itself and its consolidated subsidiaries;
(b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of Intermediate Holdings or the Cayman
Borrower, as applicable, (i) its unaudited consolidated balance sheet and
related statements of operations, stockholders' equity and cash flows as of
the end of and for such fiscal quarter and the then-elapsed portion of the
fiscal year, setting forth in each case in comparative form the figures for
the corresponding period or periods of (or, in the case of the balance
sheet, as of the end of) the previous fiscal year, all certified by one of
its Financial Officers as presenting fairly in all material respects the
consolidated financial condition and results of operations of Intermediate
Holdings (for as long as it is a Loan Party), the Borrowers and the
consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes and (ii) selected unaudited consolidated financial
information of the Cayman Borrower, which will include the line-items set
forth on Schedule 5.01; provided that, if Intermediate Holdings ceases to
--------
be a Loan Party, the Cayman Borrower will furnish the information required
by clause (i) (but not clause (ii)) with respect to itself and its
consolidated subsidiaries;
(c) concurrently with any delivery of financial statements under
paragraph (a) or (b) above, a certificate of a Financial Officer of the
Person
96
delivering such financial statements (i) certifying as to whether a Default
has occurred and, if a Default has occurred, specifying the details thereof
and any action taken or proposed to be taken with respect thereto, (ii)
setting forth reasonably detailed calculations demonstrating compliance
with Sections 6.12, 6.13 and 6.14, (iii) stating whether any change in GAAP
or in the application thereof has occurred since the date of Intermediate
Holdings's audited financial statements referred to in Section 3.04 and, if
any such change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate and (iv) identifying any
Permitted Acquisitions that have been consummated since the end of the
previous fiscal quarter, including the date on which each such Permitted
Acquisition was consummated and the consideration therefor;
(d) concurrently with any delivery of financial statements under
paragraph (a) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during
the course of their examination of such financial statements of any Default
(which certificate may be limited to the extent required by accounting
rules or guidelines);
(e) concurrently with any delivery of financial statements under
paragraph (a) above with respect to any fiscal year, a detailed
consolidated operating and capital expenditure budget for the Borrowers and
the Subsidiaries for the following fiscal year (including a projected
consolidated balance sheet and related statements of projected operations
and cash flows as of the end of and for such fiscal year and setting forth
any material assumptions used for purposes of preparing such budget) and,
promptly when available, any significant revisions of such budget;
(f) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
Intermediate Holdings (for so long as it is a Loan Party), either Borrower
or any Subsidiary with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or, in the event that
Intermediate Holdings (for so long as it is a Loan
97
Party) or the Cayman Borrower becomes a publicly traded company,
distributed by Intermediate Holdings (for so long as it is a Loan Party) or
the Cayman Borrower to its shareholders generally, as the case may be; and
(g) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of
Intermediate Holdings (for so long as it is a Loan Party), either Borrower
or any Subsidiary, or compliance with the terms of any Loan Document, as
the Administrative Agent or any Lender may reasonably request.
SECTION 5.02. Notices of Material Events. Intermediate Holdings and
---------------------------
each Borrower will furnish, promptly upon Intermediate Holdings's or such
Borrower's obtaining knowledge thereof, to the Administrative Agent written
notice of the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting
Intermediate Holdings, either Borrower or any Affiliate thereof that, if
adversely determined, could reasonably be expected to result in a Material
Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with any
other ERISA Events that have occurred, could reasonably be expected to
result in liability of Intermediate Holdings, the Borrowers and the
Subsidiaries in an aggregate amount exceeding $10,000,000;
(d) the occurrence of any change to the rating of any Indebtedness of
the Cayman Borrower by S&P or ▇▇▇▇▇'▇; and
(e) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of Intermediate Holdings or the
applicable Borrower setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect
thereto. At such time as Intermediate Holdings ceases to be a Loan Party, this
Section 5.02 shall no longer apply to Intermediate Holdings (and this covenant
shall no longer require notices of any events with respect to Intermediate
Holdings).
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SECTION 5.03. Information Regarding Collateral. (a) Intermediate
---------------------------------
Holdings (or, at such time as Intermediate Holdings is no longer a Loan Party,
the Cayman Borrower) will furnish to the Administrative Agent prompt written
notice of any change (i) in the corporate name of any Loan Party that executes
any Security Document, (ii) in the jurisdiction of incorporation or organization
of any Loan Party, any office in which such Loan Party maintains books or
records relating to Collateral owned by it or, to the extent that such
Collateral has an aggregate fair market value in excess of $10,000,000, any
office or facility at which Collateral owned by it is located (including the
establishment of any such new office or facility), (iii) in any Loan Party's
identity or corporate structure or (iv) in the Organization Identification
Number or the Federal Taxpayer Identification Number of any Loan Party that
executes any Security Document. Intermediate Holdings (for so long as it is a
Loan Party) and the Cayman Borrower agree not to effect or permit any change
referred to in the preceding sentence unless all filings, if any, have been
made, or will have been made within the applicable statutory period, under the
Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected security interest in all the Collateral for the benefit of
the Secured Parties. Intermediate Holdings (for so long as it is a Loan Party)
and the Cayman Borrower also agree promptly to notify the Administrative Agent
if any material portion of the Collateral is damaged or destroyed.
(b) Each year, at the time of delivery of annual financial statements
with respect to the preceding fiscal year pursuant to paragraph (a) of Section
5.01, the Person delivering such financial statements shall deliver to the
Administrative Agent a certificate of a Financial Officer of such Person (i)
setting forth all changes in the information set forth in Section 2 of the
Perfection Certificate or confirming that there has been no change in such
information, in either case since the date of the Perfection Certificate
delivered on the Effective Date or the date of the most recent certificate
delivered pursuant to this Section, and (ii) certifying that all Uniform
Commercial Code financing statements (including fixture filings, as applicable)
or other appropriate filings, recordings or registrations, including all
refilings, rerecordings and reregistrations, containing a description of the
Collateral have been filed of record or have been delivered to the
Administrative Agent for filing in each governmental, municipal or other
appropriate office in each jurisdiction identified pursuant to clause (i) above
to the extent
99
necessary to protect and perfect the security interests under the Security
Documents for a period of not less than 18 months after the date of such
certificate (except as noted therein with respect to any continuation statements
to be filed within such period).
SECTION 5.04. Existence; Conduct of Business. Each of Intermediate
-------------------------------
Holdings (for so long as it is a Loan Party) and each Borrower will, and will
cause each of its subsidiaries that is a Subsidiary to, do or cause to be done
all things necessary to preserve, renew and keep in full force and effect (a)
its legal existence and (b) the rights, contracts, licenses, permits,
privileges, franchises, patents, copyrights, trademarks and trade names used in
the conduct of the business of the Borrowers and the Subsidiaries taken as a
whole, except, in the case of clause (b) of this Section 5.04, to the extent
that the failure to take any such action could not reasonably be expected to
have a Material Adverse Effect, and provided that the foregoing shall not
--------
prohibit any merger, consolidation, liquidation or dissolution permitted under
Section 6.03 or any sale of assets permitted under Section 6.05. In addition,
each Borrower will, and will cause the Subsidiaries to, manage the cash held by
the Borrowers and the Subsidiaries in the ordinary course of business.
SECTION 5.05. Payment of Obligations. Each of Intermediate Holdings
-----------------------
(for so long as it is a Loan Party) and each Borrower will, and will cause each
of its subsidiaries that is a Subsidiary to, pay its Material Indebtedness and
other material obligations not constituting Indebtedness, including Tax
liabilities, before the same shall become delinquent or in default, except where
(a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) Intermediate Holdings, the applicable Borrower or
such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP, (c) such contest effectively suspends
collection of the contested obligation and the enforcement of any Lien securing
such obligation and (d) the failure to make payment pending such contest could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06. Maintenance of Properties. Each of Intermediate Holdings
--------------------------
(for so long as it is a Loan Party) and each Borrower will, and will cause each
of its subsidiaries that is a Subsidiary to, keep and maintain all property
material to the conduct of the business of, the Borrowers and the Subsidiaries,
taken as a whole, in good
100
working order and condition, ordinary wear and tear excepted.
SECTION 5.07. Insurance. Each of Intermediate Holdings (for so long as
----------
it is a Loan Party) and each Borrower will, and will cause each of its
subsidiaries that is a Subsidiary to, maintain, with financially sound and
reputable insurance companies (a) insurance in such amounts (with no greater
risk retention) and against such risks as are customarily maintained by
companies of established repute engaged in the same or similar businesses
operating in the same or similar locations and (b) all insurance required to be
maintained pursuant to the Security Documents. The Cayman Borrower will furnish
to the Administrative Agent, upon request, information in reasonable detail as
to the insurance so maintained.
SECTION 5.08. Casualty and Condemnation. The Cayman Borrower will
--------------------------
furnish to the Administrative Agent and the Lenders prompt written notice of any
casualty or other insured damage to any material portion of any Collateral or
the commencement of any action or proceeding for the taking of any material
portion of the Collateral or any part thereof or interest therein under power of
eminent domain or by condemnation or similar proceeding.
SECTION 5.09. Books and Records; Inspection and Audit Rights. Each of
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Intermediate Holdings (for so long as it is a Loan Party) and each Borrower
will, and will cause each of its subsidiaries that is a Subsidiary to, keep
proper books of record and account in which full, true and correct entries are
made of all material dealings and transactions in relation to its business and
activities. Each of Intermediate Holdings (for so long as it is a Loan Party)
and each Borrower will, and will cause each of its subsidiaries that is a
Subsidiary to, permit any representatives designated by the Administrative Agent
or any Lender, upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and at such reasonable intervals as
may be reasonably requested, provided that any such visit or inspection by a
--------
Lender other than the Administrative Agent shall be coordinated by (and any
request for such a visit or inspection shall be presented through) the
Administrative Agent.
SECTION 5.10. Compliance with Laws. Each of Intermediate Holdings (for
---------------------
so long as it is a Loan Party) and each Borrower will, and will cause each of
its
101
subsidiaries to, comply with all laws, rules, regulations and orders of any
Governmental Authority applicable to it or its property, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 5.11. Use of Proceeds and Letters of Credit. The proceeds of
--------------------------------------
the Term Loans, together with other existing cash of Intermediate Holdings, the
Borrowers and the Subsidiaries and the proceeds of the Senior Notes, will be
used on the Effective Date, only for (a) the payment of all obligations of the
U.S. Borrower and STI under the Existing Credit Agreement, (b) the consummation
of the Debt Tender Offer, including the payment of all related tender premiums,
consent fees and accrued interest in connection therewith, and (c) the payment
of all Transaction Costs. The proceeds of the Revolving Loans made after the
Effective Date and Swingline Loans will be used only for working capital and
other general corporate purposes. No part of the proceeds of any Loan will be
used, whether directly or indirectly, for any purpose that entails a violation
of any of the Regulations of the Board, including Regulations T, U and X.
Letters of Credit will be issued only to support obligations of the Borrowers or
any Subsidiary incurred in the ordinary course of business.
SECTION 5.12. Additional Subsidiaries. If any additional Subsidiary is
------------------------
formed or acquired (or any Moribund Subsidiary that would otherwise be a Loan
Party ceases to be a Moribund Subsidiary or any Insignificant Core Loan Party
that would otherwise be a Core Loan Party ceases to meet the qualifications of
an Insignificant Core Loan Party) after the Effective Date, unless such
Subsidiary would be an Insignificant Core Loan Party after giving effect to the
actions required by this Section 5.12, the Cayman Borrower will, (a) within ten
Business Days after such Subsidiary is formed or acquired, notify the
Administrative Agent and the Lenders thereof (and, if such Subsidiary is or will
become a Subsidiary Loan Party, identifying the subclause of the definition of
the term Subsidiary Loan Party pursuant to which it became or will become a
Subsidiary Loan Party) and (b) within 30 Business Days after such Subsidiary is
formed or acquired (or, if such Subsidiary is a Foreign Subsidiary (i) to which
clause(c)(i) of the definition of the term Collateral and Guarantee Requirement
applies, within 90 Business Days after such Foreign Subsidiary is formed or
acquired, (ii) to which clause (c)(ii) of the definition of the term Collateral
and Guarantee Requirement applies, within 60 Business Days after such Foreign
Subsidiary is formed or acquired or (iii) to which clause (c)(iii) of the
definition of the term Collateral and Guarantee Requirement
102
applies, within 60 Business Days after the financial statements pursuant to
which such Foreign Subsidiary has become subject to clause (c)(iii) of the
definition of the term Collateral and Guarantee Requirement have been delivered
to the Administrative Agent), cause the Collateral and Guarantee Requirement to
be satisfied with respect to such Subsidiary (if it is a Subsidiary Loan Party)
and with respect to any Equity Interest in or Indebtedness of such Subsidiary
owned by or on behalf of any Loan Party (except that, (A) if such Subsidiary is
(x) a Foreign Subsidiary and (y) a direct or indirect subsidiary of the U.S.
Borrower, shares of common stock of such Subsidiary to be pledged pursuant to
the applicable Pledge Agreement may be limited to 65% of the outstanding common
stock of such Subsidiary and (B) if the Administrative Agent determines, after
consultation with the Cayman Borrower, that (1) providing such security
arrangements or taking security interests in the assets of such additional
Subsidiary would violate the law of such Subsidiary's jurisdiction or (2) the
economic detriment to the Cayman Borrower and its subsidiaries of providing
security arrangements or taking security interests in the assets of such
additional Subsidiary would be excessive in view of the related benefits to be
received by the Lenders, then the Cayman Borrower shall not be required to cause
the Collateral and Guarantee Requirement to be satisfied with respect to such
additional Subsidiary or such Equity Interests or Indebtedness).
SECTION 5.13. Further Assurances. (a) In the event that any
-------------------
requirement set forth in Section 4.01(f) or 4.01(b) has not been satisfied in
full on or prior to the Effective Date, each Borrower will, and will cause each
Subsidiary to, cause such requirement to be satisfied as promptly as practicable
after the Effective Date and, in any event, to cause substantially all the
requirements set forth in Section 4.01(f) or 4.01(b) to be satisfied not later
than 90 days following the Effective Date.
(b) Each of Intermediate Holdings (for so long as it is a Loan Party)
and each Borrower will, and will cause each of its subsidiaries that is a
Subsidiary Loan Party to, execute any and all further documents, financing
statements, agreements and instruments, and take all such further actions
(including the filing and recording of financing statements, fixture filings,
mortgages, deeds of trust, charges and other documents), that may be required
under any applicable law, or that the Administrative Agent or the Required
Lenders may reasonably request, to cause the Collateral and Guarantee
Requirement to be and remain satisfied, all at the expense of the Loan Parties.
Intermediate Holdings (for so long as it is a Loan Party)
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and the Borrowers also agree to provide to the Administrative Agent, from time
to time upon request, evidence reasonably satisfactory to the Administrative
Agent as to the perfection and priority of the Liens created or intended to be
created by the Security Documents.
(c) If any material assets (including any real property or
improvements thereto or any interest therein) are acquired by either Borrower or
any Subsidiary Loan Party after the Effective Date (other than assets
constituting Collateral under any Security Document that become subject to the
Lien of such Security Document upon acquisition thereof), the Cayman Borrower
will notify the Administrative Agent, and, if requested by the Administrative
Agent or the Required Lenders, the Cayman Borrower will cause such assets to be
subjected to a Lien securing the Obligations and will take, and cause the
Subsidiary Loan Parties to take, such actions as shall be necessary or
reasonably requested by the Administrative Agent to grant and perfect such
Liens, including actions described in paragraph (a) of this Section (except, in
the case of the Foreign Subsidiaries, as provided by applicable law), all at the
expense of the Loan Parties; provided, however, that if the Administrative Agent
-------- -------
determines, after consultation with the Cayman Borrower, that (1) taking such
security interests in such assets would violate the law of the jurisdiction in
which the assets are located or the law of the jurisdiction where the Person
owning such assets is organized or (2) the economic detriment to the Cayman
Borrower and its subsidiaries of granting and perfecting a Lien in such assets
would be excessive in view of the related benefits to be received by the
Lenders, then the Cayman Borrower shall not be required to cause such assets to
be subjected to a Lien.
ARTICLE VI
Negative Covenants
------------------
Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full
and all Letters of Credit have expired or terminated and all LC Disbursements
shall have been reimbursed, each of Intermediate Holdings (for so long as it is
a Loan Party) and each Borrower covenants and agrees with the Lenders that:
SECTION 6.01. Indebtedness; Certain Equity Securities. (a) During any
----------------------------------------
Non-Investment Grade Period, neither Borrower will, and the Borrowers will not
permit any
104
Subsidiaries to, create, incur, assume or permit to exist any Indebtedness,
except:
(i) Indebtedness created under the Loan Documents;
(ii) Permitted High-Yield Indebtedness and extensions, renewals,
refinancings and replacements of such Permitted High Yield Indebtedness
that do not increase the outstanding principal amount thereof or result in
an earlier maturity date or decreased weighted average life thereof and
that do not contain covenants that are more restrictive from the Cayman
Borrower's perspective than the covenants contained in the Senior Notes;
(iii) Indebtedness existing on the date hereof and set forth in
Schedule 6.01 and extensions, renewals, refinancings and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof or result in an earlier maturity date or decreased weighted average
life thereof;
(iv) Indebtedness of either Borrower to Intermediate Holdings (for so
long as it is a Loan Party), any Subsidiary or the other Borrower and of
any Subsidiary to Intermediate Holdings (for so long as it is a Loan
Party), either Borrower or any other Subsidiary, provided that (A)
--------
Indebtedness of any Subsidiary that is not a Core Loan Party to either
Borrower or any Core Loan Party shall be subject to Section 6.04 and (B)
any Indebtedness owed by either Borrower or any Subsidiary to Intermediate
Holdings that is outstanding on the date that Intermediate Holdings ceases
to be a Loan Party shall cease to be Indebtedness permitted under this
clause (iv);
(v) Guarantees by either Borrower of Indebtedness or Permitted
Obligations of any Subsidiary or of the other Borrower, and by any
Subsidiary of Indebtedness or Permitted Obligations of either Borrower or
any other Subsidiary, provided that such Indebtedness or Permitted
--------
Obligations is otherwise permitted hereunder, and provided further that
-------- -------
Guarantees by either Borrower or any Core Loan Party of Indebtedness or
Permitted Obligations of any Subsidiary that is not a Core Loan Party shall
be subject to Section 6.04;
(vi) Indebtedness of either Borrower or any Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or
capital assets, including Capital Lease Obligations and any
105
Indebtedness assumed in connection with the acquisition of any such assets
or secured by a Lien on any such assets prior to the acquisition thereof
(provided that such Indebtedness is incurred prior to or within 180 days
--------
after such acquisition or the completion of such construction or
improvement), and extensions, renewals, refinancings and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof, provided that the aggregate principal amount of Indebtedness
--------
permitted by this clause (vi) shall not exceed $150,000,000 at any time
outstanding;
(vii) Indebtedness of either Borrower or any Subsidiary in respect of
workers' compensation claims, self-insurance obligations, performance
bonds, surety, appeal or similar bonds and completion guarantees provided
by the Borrowers and the Subsidiaries in the ordinary course of their
business, provided that upon the incurrence of Indebtedness with respect to
--------
reimbursement type obligations regarding workers' compensation claims, such
obligations are reimbursed within 30 days following such drawing or
incurrence;
(viii) Indebtedness of either Borrower or any Subsidiary that was
Indebtedness of any other Person existing at the time such other Person was
merged with or became a Subsidiary, and extensions, renewals, refinancings
and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof or result in an earlier maturity date
or decreased weighted average life thereof, provided, that (A) such
--------
Indebtedness was not incurred in connection with, or in contemplation of,
such other Person's merging with or becoming a Subsidiary, and (B) the
aggregate principal amount of Indebtedness permitted under this clause
(viii) shall not exceed $100,000,000 at any time outstanding;
(ix) Indebtedness of either Borrower or any Subsidiary in respect of
letters of credit (including the Outside Letters of Credit) not issued
under this Agreement and issued in the ordinary course of the applicable
Borrower's or Subsidiary's business, provided that the aggregate face
--------
amount of undrawn and unexpired letters of credit issued and outstanding
pursuant to this clause (ix) plus the aggregate amounts drawn but not
reimbursed under letters of credit issued pursuant to this clause (ix)
shall not exceed $100,000,000 at any time;
106
(x) Indebtedness of either Borrower or any Subsidiary representing
deferred compensation to employees of the Borrowers or the Subsidiaries
incurred in the ordinary course of the applicable Borrower's or
Subsidiary's business, consistent with the historical practices of such
Borrower or such Subsidiary;
(xi) drawings under Overdraft Facilities, provided that any drawing
--------
that is not repaid in full on the same day that such drawing is made shall
not be permitted by this clause (xi); and
(xii) other Indebtedness in an aggregate principal amount not
exceeding $225,000,000 at any time outstanding, provided that the aggregate
--------
principal amount of Indebtedness of the Subsidiaries that are not Core Loan
Parties permitted by this clause (xii) shall not exceed $50,000,000 at any
time outstanding;
(xiii) During a Non-Investment Grade Period, Indebtedness incurred
during any prior Investment Grade Period and outstanding at the end of the
immediately preceding Investment Grade Period, provided that such
--------
Indebtedness could not be classified as Indebtedness permitted under any
other clause of this Section 6.01(a).
(b) Intermediate Holdings will not create, incur, assume or permit to
exist any Indebtedness except (i) Indebtedness created under the Loan Documents,
(ii) its Guarantees of the Permitted High-Yield Indebtedness and (iii)
Indebtedness to the Cayman Borrower in respect of loans made by the Cayman
Borrower pursuant to Section 6.04(v).
(c) Neither Intermediate Holdings nor the Borrowers will, nor will the
Borrowers permit any of the Subsidiaries to, issue any preferred shares or other
preferred Equity Interests, except that (i) Intermediate Holdings or the Cayman
Borrower, as applicable, may issue to Holdings its preferred shares or other
preferred Equity Interests that do not require mandatory cash dividends or
redemptions and do not provide for any right on the part of the holder to
require redemption, repurchase or repayment thereof, in each case prior to the
date that is 91 days after May 13, 2007, and (ii) Intermediate Holdings, either
Borrower or any Subsidiary may issue directors' qualifying shares or shares
required by applicable law to be held by a Person other than Holdings,
Intermediate Holdings, either Borrower or any Subsidiary.
107
SECTION 6.02. Liens. (a) Neither Borrower will, and the Borrowers will
------
not permit any of the Subsidiaries to, create, incur, assume or permit to exist
any Lien on any property or asset now owned or hereafter acquired by it, or
assign or sell any income or revenues (including accounts receivable) or rights
in respect thereof, except:
(i) Liens created under the Loan Documents;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of either Borrower or any
Subsidiary existing on the date hereof and set forth in Schedule 6.02,
provided that (A) such Lien shall not apply to any other property or asset
--------
of either Borrower or any Subsidiary and (B) such Lien shall secure only
those obligations that it secures on the date hereof and extensions,
renewals and replacements thereof that do not increase the outstanding
principal amount thereof;
(iv) any Lien existing on any property or asset prior to the
acquisition thereof by either Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date
hereof prior to the time such Person becomes a Subsidiary, provided that
--------
(A) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (B)
such Lien shall not apply to any other property or assets of either
Borrower or any Subsidiary and (C) such Lien shall secure only those
obligations that it secures on the date of such acquisition or the date
such Person becomes a Subsidiary, as the case may be, and extensions,
renewals and replacements thereof that do not increase the outstanding
principal amount thereof;
(v) Liens on fixed or capital assets acquired, constructed or improved
by either Borrower or any Subsidiary, provided that (A) such Liens secure
--------
Indebtedness permitted by clause (vi) of Section 6.01(a), (B) such security
interests and the Indebtedness secured thereby are incurred prior to or
within 180 days after such acquisition or the completion of such
construction or improvement, (C) the Indebtedness secured thereby does not
exceed 100% of the cost of acquiring, constructing or improving such fixed
or capital assets and (D) such security interests shall not apply to any
other property or assets of either Borrower or any Subsidiary;
108
(vi) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of setoff or similar rights;
(vii) Liens in favor of a landlord on leasehold improvements in leased
premises;
(viii) Liens arising by operation of law, including Liens imposed
pursuant to Environmental Laws or ERISA, that secure obligations in an
aggregate amount not to exceed $5,000,000 at any time outstanding;
(ix) "Permitted Encumbrances" under and as such term is defined in the
respective Mortgages in respect of the applicable Mortgaged Properties;
(x) Liens arising from Permitted Investments described in clause (d)
of the definition of the term Permitted Investments;
(xi) During a Non-Investment Grade Period, other Liens securing
obligations not exceeding $50,000,000 at any one time outstanding;
(xii) During a Non-Investment Grade Period, Liens incurred during any
prior Investment Grade Period pursuant to clause (xiii) of this Section
6.02(a) and outstanding at the end of the immediately preceding Investment
Grade Period, provided that such Liens could not be classified as Liens
--------
created, incurred, assumed or permitted pursuant to clauses (i) through
(xi) of this Section 6.02(a); and
(xiii) During any Investment Grade Period, other Liens in respect of
assets and property the fair market value of which, on the date of
creation, incurrence or assumption, is less than or equal to 10% of
Consolidated Total Assets as of the end of the most recent period for which
financial statements have been provided pursuant to Section 5.01 provided,
--------
that the fair market value of all assets and property that are the subject
of Liens at such time does not exceed 15% of Consolidated Total Assets as
of the end of the most recent period for which financial statements have
been provided pursuant to Section 5.01.
(b) For so long as it is a Loan Party, Intermediate Holdings will not
create, incur, assume or permit to exist any Lien on any property or asset now
owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in
109
respect thereof, except Liens created under the Security Documents and Permitted
Encumbrances.
SECTION 6.03. Fundamental Changes. (a) Neither Intermediate Holdings
--------------------
(for so long as it is a Loan Party) nor the Borrowers will, nor will the
Borrowers permit any of the Subsidiaries to, merge into or consolidate with any
other Person, or permit any other Person to merge into or consolidate with
Intermediate Holdings (for so long as it is a Loan Party), either Borrower or
any Subsidiary, or liquidate or dissolve, nor will Intermediate Holdings or the
Borrowers sell, transfer, lease or otherwise dispose of all or substantially all
the assets of the Borrowers and the Subsidiaries, taken as a whole (whether
directly or through the sale, transfer, lease or other disposition of the assets
of one or more Subsidiaries), except that (i) Intermediate Holdings may, in
connection with an IPO of the Cayman Borrower or following the sale, transfer,
liquidation or other disposition of SAN Holdings and its subsidiaries, liquidate
or dissolve or merge into or consolidate with the Cayman Borrower or Holdings,
and (ii) if at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing (A) any Person may merge with
Intermediate Holdings or either Borrower in a transaction in which the surviving
entity is a Person organized or existing under the laws of the United States of
America, any State thereof, the District of Columbia or the Cayman Islands and,
if such surviving entity is not Intermediate Holdings or the applicable
Borrower, as the case may be, such Person expressly assumes, in writing, all the
obligations of Intermediate Holdings or such Borrower, as the case may be, under
the Loan Documents, (B) any Person may merge with any Subsidiary in a
transaction in which the surviving entity is a Subsidiary and (if any party to
such merger is a Core Loan Party) is a Core Loan Party and (C) any Subsidiary
(other than a Core Loan Party that is not an Insignificant Core Loan Party on
the date of such liquidation or dissolution) may liquidate or dissolve if the
Cayman Borrower determines in good faith that such liquidation or dissolution is
in the best interests of the Borrowers and is not materially disadvantageous to
the Lenders, provided that any such merger described in clauses (A) or (B)
--------
hereof involving a Person that is not a wholly owned Subsidiary immediately
prior to such merger shall not be permitted unless also permitted by Sections
6.04 and 6.08.
(b) The Borrowers will not, and the Borrowers will not permit any of
the Subsidiaries to, engage to any material extent in any business other than
businesses of the type conducted by the Borrowers and the Subsidiaries on the
110
date of execution of this Agreement and businesses reasonably related, ancillary
or complementary thereto.
(c) For so long as it is a Loan Party, Intermediate Holdings will not
engage in any business or activity other than (i) the ownership of capital stock
of SAN Holdings and the Cayman Borrower, (ii) the sale, transfer or other
disposition of capital stock of SAN Holdings and the Cayman Borrower (in the
case of the Cayman Borrower, to the extent permitted under this Agreement),
(iii) the ownership of assets received in connection with any such sale,
transfer or other disposition, (iv) any merger, liquidation, dissolution,
consolidation or transactions permitted by Section 6.03(a), (v) the making of
investments permitted by Section 6.04(b), (c), (d) or (e), (vi) the making of
distributions (of any nature whatsoever) to its shareholders and (vii)
activities incidental thereto. For so long as it is a Loan Party, Intermediate
Holdings will not own or acquire any assets other than assets acquired pursuant
to a transaction permitted by the preceding sentence, cash and Permitted
Investments or incur any liabilities (other than liabilities under the Loan
Documents, Indebtedness to the Cayman Borrower in respect of loans made by the
Cayman Borrower pursuant to Section 6.04(v), subordinated Guarantees of the
Existing Subordinated Debt, Guarantees of the Senior Notes and Guarantees of
obligations of the Borrowers and the Subsidiaries under leases of real property,
liabilities imposed by law, including tax liabilities and other liabilities
incidental to its existence and permitted business activities).
SECTION 6.04. Investments, Loans, Advances, Guarantees and
--------------------------------------------
Acquisitions. Each of Intermediate Holdings (for so long as it is a Loan Party)
------------
and the Borrowers will not, and the Borrowers will not permit any of the
Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly owned Subsidiary prior to such merger) any
Equity Interests in or evidences of indebtedness or other securities (including
any option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other interest in, any other Person, or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit, except:
(a) Permitted Investments;
111
(b) investments existing on the date hereof and set forth on Schedule
6.04;
(c) investments by Intermediate Holdings, the Borrowers and the
Subsidiaries in Equity Interests in their respective subsidiaries, provided
--------
that (i) any such Equity Interests held by Intermediate Holdings, either
Borrower or a Subsidiary Loan Party shall, to the extent required by the
Collateral and Guarantee Requirement, be pledged pursuant to the applicable
Pledge Agreement or Foreign Security Agreement and (ii) the aggregate
amount of investments made after the Effective Date by Core Loan Parties
in, and loans and advances outstanding at any time by Core Loan Parties to,
and Guarantees outstanding at any time by Core Loan Parties of Indebtedness
of, Subsidiaries that are not Core Loan Parties shall not exceed
$150,000,000 at any time outstanding;
(d) loans or advances made by Intermediate Holdings to either Borrower
or to any Subsidiary, made by either Borrower to the other Borrower or to
any Subsidiary and made by any Subsidiary to either Borrower or any other
Subsidiary, provided that (i) any such loans and advances made by
--------
Intermediate Holdings, either Borrower or a Subsidiary Loan Party shall be
evidenced by a promissory note and, to the extent required by the
Collateral and Guarantee Requirement, shall (subject to applicable law) be
pledged pursuant to the applicable Pledge Agreement or Foreign Security
Agreement and (ii) the amount of such loans and advances made by Core Loan
Parties to Subsidiaries that are not Core Loan Parties shall be subject to
the limitation set forth in clause (c)(ii) above;
(e) Guarantees constituting Indebtedness permitted by Section 6.01 and
Guarantees of Permitted Obligations permitted by Section 6.01, provided
--------
that the aggregate principal amount of Indebtedness of Subsidiaries that
are not Core Loan Parties that is Guaranteed by any Core Loan Party shall
be subject to the limitation set forth in clause (c)(ii) above;
(f) investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(g) Permitted Acquisitions;
112
(h) any investments in or loans to any other Person received as
noncash consideration for sales, transfers, leases and other dispositions
permitted by Section 6.05, including Publicly Traded Equity Securities
received by Intermediate Holdings as consideration for any sale permitted
by Section 6.05(c);
(i) Guarantees by the Borrowers and the Subsidiaries of leases other
than Capital Lease Obligations entered into by any Subsidiary as lessee;
(j) extensions of credit in the nature of accounts receivable or notes
receivable in the ordinary course of business;
(k) investments in payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be
treated as expenses for accounting purposes and that are made in the
ordinary course of business;
(l) loans or advances to employees, directors and officers not
exceeding $15,000,000 in the aggregate at any one time outstanding, in each
case, made in the ordinary course of business consistent with prudent
business practice;
(m) investments in or acquisitions of stock, obligations or securities
received in settlement of debts created in the ordinary course of business
and owing to either Borrower or any Subsidiary or in satisfaction of
judgments;
(n) investments in the form of Swap Agreements permitted under Section
6.07;
(o) investments, loans, advances, guarantees and acquisitions
resulting from a foreclosure by Intermediate Holdings, either Borrower or
any Subsidiary with respect to any secured investment or other transfer of
title with respect to any secured investment in default;
(p) investments, loans, advances, guarantees and acquisitions the
consideration for which consists solely of shares of common stock of
Intermediate Holdings;
(q) Strategic Investments in an amount not to exceed the sum of (i)
any Net Proceeds received by
113
either Borrower or any Subsidiary from sales after the date hereof of (A)
future Strategic Investments made pursuant to this paragraph (q) or (B)
assets received as the consideration for any sale referred to in clause (A)
above, in each case not otherwise used for a purpose that would result in a
reduction in Net Proceeds and (ii)(x) during any Non-Investment Grade
Period, $100,000,000 or (y) during any Investment Grade Period,
$250,000,000, provided that if the amount of Strategic Investments made in
--------
accordance with this Section 6.04(q) and outstanding at the time an
Investment Grade Period ends exceeds the amount of Strategic Investments
that would be permitted under this Section 6.04(q) at the time the
succeeding Non-Investment Grade Period commences, then the amount of such
excess (less the amount by which Strategic Investments are reduced during
such succeeding Non-Investment Grade Period) shall be deemed to be
permitted under this Section 6.04(q);
(r) prepayments or advances to vendors or suppliers of semiconductors
in connection with any guarantee of supply by, or to fund the expansion of
supply capacity by, such vendor or supplier, in an aggregate amount not to
exceed $50,000,000 at any one time outstanding;
(s) loans, capital contributions and other payments to the Cayman
Borrower to permit the Cayman Borrower to make Permitted Liquidity Event
Distributions permitted by Section 6.08(a)(v) and (viii) to, or for the
account of, participants in its Deferred Compensation Plans;
(t) capital contributions to Denmark Holdings or from Denmark Holdings
to Netherlands Holdings in an aggregate amount not to exceed $35,000,000,
provided that (i) each such capital contribution is made in cash and (ii)
--------
on the same day that any such capital contribution is made, either (A)
Denmark Holdings shall contribute in cash the full amount of such capital
contribution to a Core Loan Party organized under the laws of Japan as
common equity or (B) Denmark Holdings shall contribute in cash the full
amount of such capital contribution to Netherlands Holdings as common
equity and Netherlands Holdings shall contribute in cash the full amount of
such capital contribution to a Core Loan Party organized under the laws of
Japan as common equity;
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(u) investments made using Distributable Liquidity Event Proceeds that
have been designated for such use pursuant to Section 6.05(c)(iii) or
Section 6.05(c)(iv);
(v) loans or advances made by the Cayman Borrower to Intermediate
Holdings using Distributable Liquidity Event Proceeds that have been
designated for such use pursuant to Section 6.05(c)(iv)(A), provided that
--------
(A) the amount of any loans or advances made pursuant to this Section
6.04(v) shall reduce, on a dollar-for-dollar basis, the amount of
Distributable Liquidity Event Proceeds that may be distributed pursuant to
Section 6.08(a)(v) and (B) the making of such loan or advance shall be
subject to clause (B) of the proviso in Section 6.08(a)(v);
(w) other investments in an aggregate amount not to exceed
$25,000,000; and
(x) investments by Intermediate Holdings in SAN Holdings or its
subsidiaries using dividends or distributions from the Cayman Borrower
permitted by Section 6.08(a)(ix).
SECTION 6.05. Asset Sales. During a Non-Investment Grade Period,
-----------
Intermediate Holdings (for so long as it is a Loan Party) and the Borrowers will
not, and the Borrowers will not permit the Subsidiaries to, sell, transfer,
lease or otherwise dispose of any asset, including any Equity Interest owned by
it, and Intermediate Holdings (for so long as it is a Loan Party) and the
Borrowers will not, and the Borrowers will not permit the Subsidiaries to, issue
any additional Equity Interests in such Person, except:
(a) sales of inventory, used or surplus equipment and Permitted
Investments in the ordinary course of business and periodic clearance of
aged inventory;
(b) sales, transfers, dispositions and issuances of Equity Interests
to either Borrower or a Subsidiary, provided that any such sales,
--------
transfers, dispositions or issuances of Equity Interests involving a
Subsidiary that is not a Core Loan Party shall be made in compliance with
Section 6.09;
(c) Permitted Intermediate Holdings Equity Sales and Permitted Cayman
Borrower Equity Sales and any sale for cash or Publicly Traded Equity
Securities of Publicly Traded Equity Securities received as the
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consideration for any sale permitted by this paragraph (c), provided that
--------
(i) at the time of and immediately after giving effect to any
such Permitted Intermediate Holdings Equity Sale or Permitted Cayman
Borrower Equity Sale, no Default has occurred and is continuing or
would result therefrom;
(ii) the Borrowers and the Subsidiaries are in compliance, on a
pro forma basis after giving effect to such Permitted Intermediate
Holdings Equity Sale or Permitted Cayman Borrower Equity Sale, with
the covenants contained in Sections 6.12, 6.13 and 6.14 recomputed as
at the last day of the most recent fiscal quarter of Intermediate
Holdings for which financial statements are available, as if such
Permitted Intermediate Holdings Equity Sale or Permitted Cayman
Borrower Equity Sale had occurred on the first day of each relevant
period for testing such compliance;
(iii) in the case of a Permitted Cayman Borrower Equity Sale of
the type described in clause (c) of the definition of the term
Distributable Liquidity Event Proceeds or a Permitted Intermediate
Holdings Equity Sale, Intermediate Holdings shall have delivered to
the Administrative Agent, not more than 30 days after the consummation
of such sale, a certificate signed by a Financial Officer of
Intermediate Holdings that (A) certifies the amount of the Net
Proceeds, sets forth in reasonable detail the calculation thereof and
certifies the portion thereof, if any, that will be contributed to the
Cayman Borrower and (B) designates the portion of the Distributable
Liquidity Event Proceeds therefrom that may be used (1) to pay a
dividend or make a distribution pursuant to Section 6.08(a)(v) or make
a loan pursuant to Section 6.04(v), (2) to make investments pursuant
to Section 6.04(u), (3) to repurchase Senior Notes pursuant to Section
6.08(c)(v) or (4) to repurchase Senior Notes pursuant to Section
6.08(c)(vi); and
(iv) in the case of a Permitted Cayman Borrower Equity Sale
referred to in the definition of Distributable Liquidity Event
Proceeds, the Cayman Borrower shall have delivered to the
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Administrative Agent, not more than 30 days after the consummation of
such sale, a certificate signed by a Financial Officer of the Cayman
Borrower that (A) certifies the amount of the Distributable Liquidity
Event Proceeds therefrom and sets forth in reasonable detail the
calculation thereof and (B) designates the portion of the
Distributable Liquidity Event Proceeds from such sale that may be used
(1) to pay a dividend or make a distribution pursuant to Section
6.08(a)(v) or make a loan pursuant to Section 6.04(v), (2) to make
investments pursuant to Section 6.04(u), (3) to repurchase Senior
Notes pursuant to Section 6.08(c)(v) or (4) to repurchase Senior Notes
pursuant to Section 6.08(c)(vi);
(d) sales by Intermediate Holdings of (i) Equity Interests in SAN
Holdings or any subsidiary of SAN Holdings, (ii) any cash or other assets
of SAN Holdings or any subsidiary of SAN Holdings or (iii) assets received
as the consideration for any sale permitted by this paragraph (d)
(including a sale pursuant to this clause (iii));
(e) issuances to officers, directors and employees of Intermediate
Holdings or the Cayman Borrower of options, warrants or other rights to
purchase the capital stock of Intermediate Holdings or the Cayman Borrower,
respectively (the "Permitted Options") and sales of shares of capital stock
-----------------
of Intermediate Holdings or the Cayman Borrower, respectively, to such
officers, directors and employees upon the exercise of Permitted Options,
provided that at no time shall the shares subject to (and issued upon the
--------
exercise of) Permitted Options represent greater than 20% of the
outstanding capital stock of each of Intermediate Holdings and the Cayman
Borrower, respectively, at such time) calculated on a fully diluted basis
after giving effect to all options to acquire common stock of Intermediate
Holdings and the Cayman Borrower then outstanding, regardless of whether or
not such options are then currently exercisable);
(f) sales of assets (other than Equity Interests in a Subsidiary)
pursuant to a transaction permitted by Section 6.03(a);
(g) sales of assets pursuant to a sale and leaseback transaction
permitted by Section 6.06;
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(h) sales by either Borrower or any Subsidiary of all the Equity
Interests in, or of all or substantially all the assets of, Seagate
Technology ▇▇▇▇▇▇▇, S. de ▇. ▇. de C.V.;
(i) sales of assets received by Intermediate Holdings, either Borrower
or any Subsidiary upon the exercise of a power of sale or foreclosure by
Intermediate Holdings, either Borrower or any Subsidiary with respect to
any secured investment or other transfer of title with respect to any
secured investment in default;
(j) licensing and cross-licensing arrangements entered into in the
ordinary course of either Borrower's or any Subsidiary's business involving
any technology or other intellectual property of such Borrower or such
Subsidiary;
(k) sales, transfers and other dispositions of assets (other than
Equity Interests in either Borrower or a Subsidiary) that are not permitted
by any other clause of this Section, provided that the aggregate fair
--------
market value of all assets sold, transferred or otherwise disposed of in
reliance upon this clause (k) shall not during any fiscal year of the
Cayman Borrower exceed (i) during any period when the Index Debt is rated
below BBB- by S&P or Baa3 by ▇▇▇▇▇'▇, the amount that is equal to 5.0% of
Consolidated Total Assets or (ii) during any period in which the Index Debt
is rated (x) BBB- or better by S&P and (y) Baa3 or better by ▇▇▇▇▇'▇, the
amount that is equal to 10% of Consolidated Total Assets, in each case as
of the end of the immediately preceding fiscal year of the Cayman Borrower;
(l) licensing of assets that constitute technology or other
intellectual property to joint ventures in connection with investments
permitted by Section 6.04;
(m) transfers of patents and patent applications for flexure-based
microactuator technology and flexure technology to ▇▇▇▇▇▇▇▇▇▇ Technology
pursuant to the ▇▇▇▇▇▇▇▇▇▇ Settlement;
(n) Permitted Liquidity Event Distributions permitted by Section
6.08(a)(v);
(o) sales, transfers and other dispositions of 100% of the outstanding
Equity Interests in any Subsidiary if the sale of all or substantially all
of
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the assets of such Subsidiary would be permitted pursuant to clause (k) of
this Section; and
(p) the sale by STI of the assets constituting the printed circuit
board business of STI.
provided that all sales, transfers, leases and other dispositions permitted
--------
hereby (other than those permitted by clauses (b),(d), (e) and (n) above) shall
be made for fair market value and (except in the case of (x) a transfer made
pursuant to clause (b), (c), (d), (e), (f), (i), (j), (l), (m), (n) or (o)
above, (y) transfers of assets having an aggregate fair market value not to
exceed $40,000,000 during the term of this Agreement made pursuant to clause (k)
above or (z) a transfer made pursuant to clause (h) above, which shall be made
for consideration of at least 65% cash or cash equivalents) for consideration of
at least 75% cash or cash equivalents, except to the extent expressly provided
otherwise elsewhere in this Agreement.
SECTION 6.06. Sale and Leaseback Transactions. Intermediate Holdings
-------------------------------
(for so long as it is a Loan Party) and the Borrowers will not, and the
Borrowers will not permit the Subsidiaries to, enter into any arrangement,
directly or indirectly, whereby it shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
sold or transferred, except for (i) the sale and leaseback of the design centers
located at (A) ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ and (B) ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ and (ii) any such sale of any fixed or capital assets that
is made for cash consideration in an amount not less than the cost of such fixed
or capital asset and is consummated within 180 days after such Borrower or such
Subsidiary acquires or completes the construction of such fixed or capital
asset, provided that the Borrowers and the Subsidiaries may enter into such
--------
transactions with respect to assets having a fair market value (determined in
good faith by the Borrower with respect to any such asset at the time the
transaction with respect to such asset is entered into) not to exceed
$100,000,000 in the aggregate during the term of this Agreement.
SECTION 6.07. Swap Agreements. Intermediate Holdings (for so long as
---------------
it is a Loan Party) and the Borrowers will not, and the Borrowers will not
permit the Subsidiaries to, enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which either Borrower or
any Subsidiary has actual
119
exposure (other than those in respect of Equity Interests of either Borrower or
any of the Subsidiaries), and (b) Swap Agreements entered into in order to
effectively cap, collar or exchange interest rates (from fixed to floating
rates, from one floating rate to another floating rate or otherwise) with
respect to any interest-bearing liability or investment of either Borrower or
any Subsidiary provided that Intermediate Holdings, the Borrowers and the
--------
Subsidiaries may enter into Swap Agreements in respect of Equity Interests in
the Cayman Borrower and Intermediate Holdings providing for payments to current
or former directors, officers or employees of Intermediate Holdings, the
Borrowers and the Subsidiaries or their heirs or estates (and may make such
payments), in the same circumstances and amounts that Intermediate Holdings, the
Borrowers and the Subsidiaries are then permitted to make Restricted Payments
pursuant to Section 6.08(a)(iii), and any payments made pursuant to this proviso
during any fiscal year shall be deemed to reduce the amount of Restricted
Payments available during such fiscal year under Section 6.08(a)(iii).
SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness.
-----------------------------------------------------
(a) During any Non-Investment Grade Period, other than as specified in the first
sentence of Section 5.11, neither Borrower will, nor will the Borrowers permit
the Subsidiaries to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, except that:
(i) the Borrowers and the Subsidiaries may declare and pay dividends
ratably with respect to their capital stock payable solely in additional
shares of their capital stock;
(ii) Subsidiaries and the U.S. Borrower may declare and pay dividends
ratably with respect to their capital stock;
(iii) the Borrowers and the Subsidiaries may make Restricted Payments,
not exceeding $25,000,000 during any fiscal year, pursuant to and in
accordance with stock option plans or other benefit plans for directors,
management or employees of Holdings, Intermediate Holdings, the Borrowers
and the Subsidiaries, including the redemption or purchase of capital stock
of Holdings, Intermediate Holdings, the Borrowers or a Subsidiary held by
former directors, management or employees of Holdings, Intermediate
Holdings, either Borrower or any Subsidiary following termination of their
employment;
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(iv) the U.S. Borrower and STI may pay dividends to the Cayman
Borrower and the Cayman Borrower may pay dividends to Intermediate Holdings
and its other shareholders (ratably in accordance with their equity
ownership), in each case at such times and in such amounts, not exceeding
$5,000,000 during any fiscal year, as shall be necessary to permit Holdings
to discharge its liabilities;
(v) the Cayman Borrower may make Permitted Liquidity Event
Distributions to Intermediate Holdings and its other shareholders (ratably
in accordance with their equity ownership) and to, or for the account of,
participants in its Deferred Compensation Plans using Distributable
Liquidity Event Proceeds designated for such use pursuant to Section
6.05(c)(iv), provided, in each case, that (A) the amount of such
--------
Distributable Liquidity Event Proceeds available for distribution pursuant
to this clause (v) shall be calculated after giving effect to the amount of
Distributable Liquidity Event Proceeds applied pursuant to Section 6.04(v)
and (B) no Default has occurred and is continuing or would occur as a
result of such Permitted Liquidity Event Distributions;
(vi) (A) If and for so long as the Cayman Borrower or any of its
subsidiaries is a controlled foreign corporation for United States Federal
income tax purposes for all or a portion of the Cayman Borrower's or any
such subsidiary's taxable year, within 30 days after the end of each
calendar year during which such taxable year ends, the Cayman Borrower may
declare and pay a dividend on its capital stock to Intermediate Holdings,
in a maximum amount equal to the product of (x) the aggregate amount of
"Subpart F income" (within the meaning of Section 952 of the Code, which
for purposes of this clause (vi) shall include income includable under
Section 951(a)(1)(B) of the Code) of the Cayman Borrower for the portion of
such taxable year for which the Cayman Borrower was a controlled foreign
corporation plus the amount of Subpart F income of any of the Cayman
Borrower's subsidiaries for the portion of such taxable year for which such
subsidiary was a controlled foreign corporation (other than "Subpart F
income" resulting from the distribution of any amount under Section
6.08(a)(ii)) multiplied by (y) 40% (such dividends, "Tax Distributions").
(B) As a condition to making any Tax Distribution under paragraph (A)
above or any interim Tax Distribution
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under paragraph (D) below, the Cayman Borrower will deliver to the
Administrative Agent at least 30 calendar days prior to the declaration and
payment of such Tax Distribution, a notice, certified by the Chief Financial
Officer of the Cayman Borrower, setting forth in detail reasonably satisfactory
to the Administrative Agent the basis for the determination of the amount of
such Tax Distribution.
(C) If the Cayman Borrower makes any Tax Distribution pursuant to this
clause (vi) in respect of any taxable income realized on any sale of assets or
Equity Interests permitted under Section 6.05(c) or 6.05(h), the consideration
for which consists of Publicly Traded Equity Securities, such Tax Distribution
shall be made in the form of Publicly Traded Equity Securities to the extent
that the Cayman Borrower is legally permitted to do so.
(D) Interim Tax Distributions may be made during each calendar year on
or shortly after April 10, June 10, September 10 and December 31 of such year
based on good-faith estimates of the Subpart F income, if any, of the Cayman
Borrower and its subsidiaries for the taxable year to which any such interim Tax
Distribution relates. If any such interim Tax Distributions are made by the
Cayman Borrower during a calendar year, then within 30 calendar days after the
end of such calendar year the Cayman Borrower shall deliver to the
Administrative Agent a determination of the maximum amount of Tax Distributions
that may be made for such calendar year under paragraph (A) above, and if the
aggregate interim Tax Distributions made for such calendar year exceed such
maximum, then such excess amount ("Excess Interim Tax Distributions") shall be
applied to reduce all amounts payable pursuant to this Section 6.08(a)(vi) for
the next calendar year and to the extent not so applied, shall be carried
forward for application against such amounts in a future calendar year.
(vii) the Holdings Distribution and the Secondary Distribution,
provided that the sum of the amount of the Holdings Distribution and the
--------
amount of the Secondary Distribution shall not exceed $580,000,000;
(viii) the Cayman Borrower may make distributions to, or for the
account of, participants in its Deferred Compensation Plans, not exceeding
the sum of (A) $65,000,000 and (B) the excess of (1) the amount
distributable by the Cayman Borrower pursuant to clause (vii) of this
Section 6.08(a) as a Secondary Distribution over (2) the amount actually
distributed by the Cayman Borrower as a Secondary Distribution pursuant to
such clause (vii) concurrently with an IPO
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of the Cayman Borrower or Intermediate Holdings, provided that
--------
distributions pursuant to subclause (A) of this clause (viii) shall not
exceed $35,000,000 in respect of any single event and provided, further,
-------- -------
that the amount of any distribution made by the Cayman Borrower
attributable to subclause (B) of this clause (viii) shall reduce, on a
dollar-for-dollar basis, the amount that the Cayman Borrower may distribute
pursuant to clause (vii) of this Section 6.08(a); and
(ix) Restricted Payments in an aggregate amount not to exceed
$60,000,000 consisting of dividends or distributions made by the Cayman
Borrower to Intermediate Holdings prior to or in connection with an IPO of
the Cayman Borrower, provided that (i) the entire amount of such dividends
--------
or distributions are immediately contributed or otherwise provided,
directly or indirectly, to XIOtech Corporation and (ii) the entire amount
of such dividends or distributions are immediately used by XIOtech
Corporation to repay in full all amounts then owed by XIOtech Corporation
to the Cayman Borrower or its Subsidiaries;
(b) During any Investment Grade Period, neither Borrower will, nor
will either Borrower permit any Subsidiaries to, declare or make, or agree to
pay or make, directly or indirectly, any Restricted Payment unless such
Restricted Payment, together with the aggregate amount of all other Restricted
Payments made by the Borrowers and the Subsidiaries after the beginning of the
fiscal quarter of the Cayman Borrower in which the Effective Date occurs
(excluding Restricted Payments permitted by clauses (i), (ii), (v), (vi) and
(vii) referred to in Section 6.08(a)), is less than 50% of Consolidated Net
Income for the period (treated as one accounting period) commencing at the
beginning of the fiscal quarter of the Cayman Borrower in which the Effective
Date occurs and ending at the end of the most recent fiscal period for which
financial statements have been delivered pursuant to Section 5.01; provided,
--------
however, that (i) if the amount of such Restricted Payment, together with the
-------
aggregate amount of all other Restricted Payments made by the Borrowers and the
Subsidiaries during the period referred to above (excluding Restricted Payments
permitted by clauses (i), (ii), (v), (vi) and (vii) referred to in Section
6.08(a)), exceed 50% of Consolidated Net Income for the period (treated as one
accounting period) commencing at the beginning of the fiscal quarter in which
such Investment Grade Period began and ending at the end of the most recent
fiscal period for which financial statements have been delivered pursuant to
Section 5.01, then (A) on the date of such Restricted Payment and after giving
pro
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forma effect thereto, the ratio of (x) the Cash Amount to (y) Indebtedness of
the Cayman Borrower and its consolidated subsidiaries (other than Indebtedness
in respect of letters of credit securing obligations entered into in the
ordinary course of business to the extent such letters of credit are not drawn
upon or, if and to the extent drawn upon, such drawing is reimbursed no later
than the 30th Business Day following payment on such letters of credit) shall
not be less than 1.1 to 1.0 and (B) prior to such Restricted Payment being made
(1) the Administrative Agent shall have received a written statement of ▇▇▇▇▇'▇
and S&P to the effect that after giving pro forma effect to such Restricted
Payment, the Cayman Borrower would maintain its Investment Grade Ratings, and
(2) the Cayman Borrower shall have delivered to the Administrative Agent a
certificate dated as of such date and signed by a Financial Officer of the
Cayman Borrower that (x) sets forth, in reasonable detail, the calculation of
the amount of such Restricted Payments, and (y) certifies compliance with the
ratio set forth in clause (A) above, and (ii) the foregoing shall not prohibit
the Borrowers or the Subsidiaries, as applicable, from making the Restricted
Payments set forth in clauses (i) through (viii) of Section 6.08(a).
(c) Neither Borrower will, nor will the Borrowers permit the
Subsidiaries to, make or agree to pay or make, directly or indirectly, any
payment or other distribution (whether in cash, securities or other property) of
or in respect of principal of or interest on any Indebtedness, or any payment or
other distribution (whether in cash, securities or other property), including
any sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancelation or termination of any Indebtedness, except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) payment of regularly scheduled interest and principal payments as
and when due in respect of any Indebtedness, other than payments in respect
of the Existing Subordinated Debt prohibited by the subordination
provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by Section
6.01;
(iv) payment of secured Indebtedness that becomes due as a result of
the voluntary sale or transfer of the property or assets securing such
Indebtedness; and
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(v) redemption of up to 35% of the aggregate principal amount of the
Senior Notes outstanding on the Effective Date with Distributable Liquidity
Event Proceeds and on the terms set forth in the indenture under which the
Senior Notes are issued, provided, that the amount of such Distributable
--------
Liquidity Event Proceeds applied pursuant to this clause (v) shall be
limited to the amount designated for such use pursuant to Section
6.05(c)(iii) or Section 6.05(c)(iv); and
(vi) redemption of additional Senior Notes with Distributable
Liquidity Event Proceeds, provided that the amount of Distributable
--------
Liquidity Event Proceeds applied pursuant to this clause (vi) shall be
limited to the amount designated for such use pursuant to Section
6.05(c)(iii) or Section 6.05(c)(iv).
(d) If, as a result of the receipt of any cash proceeds by either
Borrower or any Subsidiary in connection with any sale, transfer, lease or other
disposition of any asset, including any Equity Interest, the Cayman Borrower
would be required by the terms of the indenture governing the Senior Notes to
make an offer to purchase any Senior Notes, then the Borrowers shall, or shall
cause one or more of the Subsidiaries to (i) prepay Loans in accordance with
Section 2.11 or (ii) acquire assets, Equity Interests or other securities in a
manner that is permitted by Section 6.04, in each case in a manner that will
eliminate any requirement to make an offer to purchase such Senior Notes. Any
such prepayment or acquisition shall be made prior to the first day on which the
Cayman Borrower would be required to commence such an offer to purchase the
Senior Notes under the indenture governing such Senior Notes.
(e) Notwithstanding anything to the contrary set forth in this
Agreement, the Borrowers will not, and will not permit any Subsidiary to,
furnish any funds to or make any investment in any Person for purposes of
enabling such Person to make any distribution or other payment (including in
respect of Indebtedness) pursuant to Section 6.08(c) that could not be made
directly by either Borrower or any Subsidiary in accordance with the provisions
of this Section.
SECTION 6.09. Transactions with Affiliates. (a) Neither Intermediate
----------------------------
Holdings (for so long as it is a Loan Party) nor the Borrowers will, nor will
the Borrowers permit the Subsidiaries to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
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Affiliates, except (i) transactions that are at prices and on terms and
conditions not less favorable to Intermediate Holdings (for so long as it is a
Loan Party), the applicable Borrower or such Subsidiary than could be obtained
on an arm's-length basis from unrelated third parties, (ii) transactions between
or among Intermediate Holdings (for so long as it is a Loan Party), the
Borrowers and the Core Loan Parties not involving any other Affiliate, (iii)
payments of management, consulting and advisory fees to the Investors pursuant
to any financial advisory, financing, underwriting or placement agreement or in
respect of other investment banking activities, including in connection with
acquisitions and divestitures, in an aggregate amount not to exceed $2,000,000
in any fiscal year, (iv) any issuance of securities, or other payments, awards
or grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans approved by the
board of directors of Intermediate Holdings (for so long as it is a Loan Party),
either Borrower or any Subsidiary, (v) the grant of stock options or similar
rights to officers, employees, consultants and directors of Intermediate
Holdings (for so long as it is a Loan Party) pursuant to plans approved by the
board of directors of Intermediate Holdings (for so long as it is a Loan Party),
either Borrower or any Subsidiary and the payment of amounts or the issuance of
securities pursuant thereto, (vi) loans or advances to employees permitted by
Section 6.04(l) and (vii) any Restricted Payment permitted by Section 6.08.
(b) The provisions of Section 6.09(a) notwithstanding, neither
Intermediate Holdings (for so long as it is a Loan Party) nor the Borrowers
will, nor will the Borrowers permit the Subsidiaries to, adopt or change any
policy regarding transfer pricing or other practices regarding cross-border
intercompany payments with Intermediate Holdings (for so long as it is a Loan
Party), either Borrower or any other Subsidiary in a manner that is
systematically disadvantageous to the Lenders.
SECTION 6.10. Restrictive Agreements. Neither Intermediate Holdings
----------------------
(for so long as it is a Loan Party) nor the Borrowers will, nor will the
Borrowers permit the Subsidiaries to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits, restricts
or imposes any condition upon (a) the ability of Intermediate Holdings (for so
long as it is a Loan Party), either Borrower or any Subsidiary to create, incur
or permit to exist any Lien upon any of its property or assets or (b) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any shares
126
of its capital stock or to make or repay loans or advances to either Borrower or
any other Subsidiary or to Guarantee Indebtedness of either Borrower or any
other Subsidiary, provided that (i) the foregoing shall not apply to
--------
restrictions and conditions imposed by law, by any Loan Document, by any Senior
Note Document or Existing Subordinated Debt Document (after giving effect to the
Debt Tender), (ii) the foregoing shall not apply to restrictions and conditions
existing on the date hereof identified on Schedule 6.10 (but shall apply to any
extension or renewal of, or any amendment or modification expanding the scope
of, any such restriction or condition), (iii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (iv) the foregoing shall not apply to customary
restrictions on or customary conditions to the payment of dividends or other
distributions on, or the creation of Liens over, Equity Interests owned by
either Borrower or any Subsidiary in any joint venture or like enterprise that
is not a Subsidiary contained in the constitutive documents of such joint
venture or enterprise, (v) clause (a) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (vi) clause
(a) of the foregoing shall not apply to customary provisions in leases or
Licenses (as such term is defined in the U.S. Security Agreement) restricting
the assignment, subletting or transfer thereof.
SECTION 6.11. Amendment of Material Documents. Neither Intermediate
-------------------------------
Holdings (for so long as it is a Loan Party) nor the Borrowers will, nor will
the Borrowers permit the Subsidiaries to, (i) amend, modify or waive any of its
rights under (A) any Existing Subordinated Debt Document, (B) any Deferred
Compensation Plan, (C) its certificate of incorporation, by-laws or other
organizational documents or (D) any Senior Note Document, except to the extent
that such amendments, modifications or waivers, individually and in the
aggregate, (1) would not reasonably be expected to have a Material Adverse
Effect or be materially adverse to the Lenders and (2) in the case of an
amendment, modification or waiver of a Deferred Compensation Plan, would not
require Intermediate Holdings or any of its subsidiaries to make any
distributions or other payments (whether in cash, securities or other property
or any combination thereof) that would be in violation of the covenants set
forth in this Agreement, or (ii) adopt any Deferred Compensation Plan if the
terms
127
(including subordination terms) of such Deferred Compensation Plan that are
material to the Lenders are in any way less favorable to the Lenders than the
terms of the Deferred Compensation Plans in effect on the date hereof and
previously provided to the Administrative Agent.
SECTION 6.12. Interest Expense Coverage Ratio. The Borrowers will not
-------------------------------
permit the ratio of (a) Consolidated EBITDA to (b) Consolidated Net Cash
Interest Expense, in each case for any period of four consecutive fiscal
quarters ending on the last day of any quarter ending on or after March 30,
2002, to be less than 2.50 to 1.00.
SECTION 6.13. Fixed Charge Coverage Ratio. The Borrowers will not
---------------------------
permit the ratio of (a) the sum of (i) Consolidated EBITDA for any period of
four consecutive fiscal quarters ending on the last day of any fiscal quarter
during any period set forth below plus (ii) the sum of (A) the amount of cash
held by either Borrower or any Subsidiary and (B) the carrying value of
Permitted Investments that would be reflected as cash or short-term investments
on a consolidated balance sheet of the Cayman Borrower on such date, minus (iii)
the aggregate principal amount of Revolving Loans and Swingline Loans
outstanding on such date to (b) Consolidated Fixed Charges for such period of
four consecutive fiscal quarters (the "Fixed Charge Coverage Ratio") to be less
--------------------- -----
than the ratio set forth below opposite such period set forth below:
Period Ratio
------ -----
March 30, 2002, to June 29, 2002 1.20 to 1.00
June 30, 2002, to June 29, 2003 1.25 to 1.00
June 30, 2003, and thereafter 1.50 to 1.00.
SECTION 6.14. Net Leverage Ratio. The Borrowers will not permit the
------------------
Net Leverage Ratio as of the end of any fiscal quarter during any period set
forth below to exceed the ratio set forth opposite such period:
Period Ratio
------ -----
March 30, 2002 to June 29, 2002 1.75 to 1.00
June 30, 2002 and thereafter 1.50 to 1.00.
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ARTICLE VII
Events of Default
-----------------
SECTION 7.01. Events of Default. If any of the following events
-----------------
("Events of Default") shall occur:
-----------------
(a) either Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
(b) either Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or any other Loan Document, when
and as the same shall become due and payable, and such failure shall
continue unremedied for a period of five days;
(c) any representation or warranty made or deemed made by or on behalf
of Intermediate Holdings, either Borrower or any Subsidiary in or in
connection with any Loan Document or any amendment or modification thereof
or waiver thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with any Loan
Document or any amendment or modification thereof or waiver thereunder,
shall prove to have been incorrect in any material respect when made or
deemed made;
(d) Intermediate Holdings or either Borrower shall fail to observe or
perform any covenant, condition or agreement contained in Sections 5.02(a),
5.04 (with respect to the existence of Intermediate Holdings or either
Borrower), 5.11 or 5.13(a) or in Article VI;
(e) any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in any Loan Document (other than those
specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof from
the Administrative Agent to the Cayman Borrower (which notice will be given
at the request of any Lender);
(f) Intermediate Holdings (for so long as it is a Loan Party) either
Borrower or any Subsidiary shall fail to make any payment (whether of
principal or
129
interest and regardless of amount) in respect of any Material Indebtedness,
when and as the same shall become due and payable after giving effect to
the applicable grace period with respect thereto;
(g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables
or permits the holder or holders of any Material Indebtedness or any
trustee or agent on its or their behalf to cause any Material Indebtedness
to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity, provided that this
--------
clause (g) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing
such Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of Intermediate Holdings (for so long as it is a Loan
Party) either Borrower or, subject to Section 7.02, any Subsidiary or its
debts, or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator, liquidator or similar official for
Intermediate Holdings (for so long as it is a Loan Party) either Borrower
or, subject to Section 7.02, any Subsidiary or for a substantial part of
its assets, and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or
ordering any of the foregoing shall be entered;
(i) Intermediate Holdings (for so long as it is a Loan Party) either
Borrower or, subject to Section 7.02, any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking dissolution,
winding-up, liquidation, reorganization or other relief under any Federal,
state or foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to contest
in a timely and appropriate manner, any proceeding or petition described in
clause (h) of this Article, (iii) apply for or consent to the appointment
of a receiver, trustee, custodian, sequestrator, conservator, liquidator or
similar official for Intermediate Holdings (for so long as it is a
130
Loan Party) either Borrower or, subject to Section 7.02, any Subsidiary or
for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing;
(j) Intermediate Holdings (for so long as it is a Loan Party) either
Borrower or, subject to Section 7.02, any Subsidiary shall become unable,
admit in writing its inability or fail generally to pay its debts as they
become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $10,000,000 (net of amounts covered by insurance as to
which the insurer has admitted liability in writing) shall be rendered
against Intermediate Holdings (for so long as it is a Loan Party), either
Borrower, any Subsidiary or any combination thereof and the same shall
remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally
taken by a judgment creditor to attach or levy upon any assets of
Intermediate Holdings (for so long as it is a Loan Party), either Borrower
or any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, when taken together with
all other ERISA Events that have occurred, could reasonably be expected to
result in a Material Adverse Effect;
(m) any Lien purported to be created under any Security Document shall
cease to be, or shall be asserted by any Loan Party not to be, a valid and
perfected Lien on Collateral having, in the aggregate, a value in excess of
$5,000,000, with the priority required by the applicable Security Document,
except (i) as a result of the sale or other disposition of the applicable
Collateral in a transaction permitted under the Loan Documents, (ii) any
action taken by the Collateral Agent to release any such Lien in compliance
with the provisions of this Agreement or any other Loan Document or (iii)
as a result of the Collateral Agent's failure to maintain possession of any
stock or share certificates, promissory notes or other instruments
delivered to it under the Pledge Agreement or to file properly (A) Uniform
Commercial Code financing statements or comparable filings delivered to it
for filing under the Security Documents or (B) Uniform
131
Commercial Code continuation statements or comparable filings necessary to
maintain perfection;
(n) a Change in Control shall occur;
(o) either Borrower, Intermediate Holdings (for so long as it is a
Loan Party) or any Subsidiary shall challenge the subordination provisions
of the Existing Subordinated Debt or any Deferred Compensation Plan or
assert that such provisions are invalid or unenforceable or that the
Obligations of either Borrower, or the Obligations of Intermediate Holdings
(for so long as it is a Loan Party) or any Subsidiary under the applicable
Guarantee Agreement, are not senior indebtedness under the subordination
provisions of the Existing Subordinated Debt or any Deferred Compensation
Plan, or any court, tribunal or government authority of competent
jurisdiction shall judge the subordination provisions of the Existing
Subordinated Debt or any Deferred Compensation Plan to be invalid or
unenforceable or such Obligations to be not senior indebtedness under such
subordination provisions; or
(p) any Guarantee under any Guarantee Agreement for any reason shall
cease to be in full force and effect (other than in accordance with its
terms), or any Loan Party shall deny in writing that it has any further
liability under its Guarantee Agreement (other than as a result of the
discharge of such Loan Party in accordance with the terms of the Loan
Documents);
then, and in every such event (other than an event with respect to either
Borrower described in clause (h) or (i) of this Article), and at any time
thereafter during the continuance of such event, the Administrative Agent may,
and at the request of the Required Lenders shall, by notice to the Borrower,
take either or both of the following actions, at the same or different times:
(i) terminate the Commitments, and thereupon the Commitments shall terminate
immediately, and (ii) declare the Loans then outstanding to be due and payable
in whole (or in part, in which case any principal not so declared to be due and
payable may thereafter be declared to be due and payable), and thereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of the Borrowers accrued
hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
each Borrower; and in case of any event with respect to either Borrower
described in clause (h) or (i) of this Article, the Commitments shall
132
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Borrowers accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Borrower.
SECTION 7.02. Exclusion of Immaterial Subsidiaries. Solely for the
------------------------------------
purposes of determining whether a Default has occurred under (a) clause (h), (i)
or (j) of Section 7.01, any reference in any such clause to any Subsidiary shall
be deemed not to include any Subsidiary affected by any event or circumstance
referred to in any such clause that did not, as of the last day of the fiscal
quarter of Intermediate Holdings (or, if Intermediate Holdings is no longer a
Loan Party, the Cayman Borrower) most recently ended, have assets with a value
in excess of 5.0% of the Consolidated Total Assets as of such date, provided
--------
that if it is necessary to exclude more than one Subsidiary from clause (h), (i)
or (j) of Section 7.01 pursuant to this clause (a) in order to avoid a Default
thereunder, all excluded Subsidiaries shall be considered to be a single
consolidated Subsidiary for purposes of determining whether the condition
specified above is satisfied and (b) under clause (i) of Section 7.01, any
reference in such clause to any "Subsidiary" shall be deemed not to include any
Moribund Subsidiary that is being dissolved, liquidated or wound up in
accordance with the definition of the term "Moribund Subsidiary".
ARTICLE VIII
The Administrative Agent
------------------------
SECTION 8.01. The Administrative Agent. Each of the Lenders and the
------------------------
Issuing Bank hereby irrevocably appoints the Administrative Agent as its agent
and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the
terms of the Loan Documents, together with such actions and powers as are
reasonably incidental thereto. For purposes of this Article VIII and for the
purposes of Section 9.02 and 9.03 of Article IX, all references to the
Administrative Agent are deemed to include the Collateral Agent.
The bank serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent, and
133
such bank and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with Holdings, Intermediate Holdings,
either Borrower or any Subsidiary or other Affiliate thereof as if it were not
the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth in the Loan Documents. Without limiting the
generality of the foregoing, (a) the Administrative Agent shall not be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) the Administrative Agent shall not have any duty
to take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated by the Loan Documents
that the Administrative Agent is required to exercise in writing by the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 9.02), and (c) except as
expressly set forth in the Loan Documents, the Administrative Agent shall not
have any duty to disclose, and shall not be liable for the failure to disclose,
any information relating to Intermediate Holdings, either Borrower or any of the
Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
wilful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by Intermediate Holdings, the Cayman Borrower or a Lender,
and the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with any Loan Document, (ii) the contents of any certificate,
report or other document delivered thereunder or in connection therewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document, or (v) the satisfaction of any condition set forth in
Article IV or elsewhere in any Loan Document, other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent.
134
The Administrative Agent shall be entitled to rely upon, and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for
relying thereon. The Administrative Agent may consult with legal counsel (who
may be counsel for the Borrowers), independent accountants and other experts
selected by it, and shall not be liable for any action taken or not taken by it
in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any of and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all its duties and exercise its rights and powers
through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of each Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders, the Issuing Bank and the Cayman
Borrower. Upon any such resignation, the Required Lenders shall have the right,
subject to the approval of the Cayman Borrower (which approval shall not be
unreasonably withheld), to appoint a successor. If no successor shall have been
so appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent that
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. The fees payable by the Borrowers to a successor
135
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Cayman Borrower and such successor. After
the Administrative Agent's resignation hereunder, the provisions of this Article
and Section 9.03 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was
acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender 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 Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or related agreement or any document furnished hereunder
or thereunder.
ARTICLE IX
Miscellaneous
-------------
SECTION 9.01. Notices. Except in the case of notices and other
-------
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to Intermediate Holdings or either Borrower, to it at ▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
(Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇) with copies to (i) Silver Lake Partners,
L.P., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇), and (ii) TPG
Partners III, L.P., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Administrative Agent, to JPMorgan Chase Bank, Loan and
Agency Services Group, One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇,
136
Attention of ▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇), with a copy to
JPMorgan Chase Bank, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (Telecopy No. (415)
371-4881);
(c) if to JPMorgan Chase Bank, as Issuing Bank, to it at JPMorgan
Chase Bank, Loan and Agency Services Group, One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No.
(▇▇▇) ▇▇▇-▇▇▇▇);
(d) if to the Swingline Lender, to it at JPMorgan Chase Bank, Loan and
Agency Services Group, One Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇); and
(e) if to any other Lender, to it at its address (or telecopy number)
set forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
-------------------
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Administrative Agent, the Issuing
Bank and the Lenders hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.
No waiver of any provision of any Loan Document or consent to any departure by
any Loan Party therefrom shall in any event be effective unless the same shall
be permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether
137
the Administrative Agent, any Lender or the Issuing Bank may have had notice or
knowledge of such Default at the time.
(b) Neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except, in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by Intermediate Holdings (for so long as it is a Loan Party), the
Borrowers and the Required Lenders or, in the case of any other Loan Document,
pursuant to an agreement or agreements in writing entered into by the
Administrative Agent or the Collateral Agent, as applicable, and the Loan Party
or Loan Parties that are parties thereto, in each case with the consent of the
Required Lenders, provided that no such agreement shall (i) increase the
--------
Commitment of any Lender without the written consent of such Lender, (ii) reduce
the principal amount of, or any scheduled payment with respect to, any Loan or
LC Disbursement or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender directly affected
thereby, (iii) postpone the final maturity of any Loan, or the required date of
reimbursement of any LC Disbursement, or any required date for the payment of
any interest or fees payable hereunder, or reduce the amount of, waive or excuse
any such required payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby, (iv)
change Section 2.18(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender, (v)
change any of the provisions of this Section or the percentage set forth in the
definition of the term "Required Lenders" or any other provision of any Loan
Document specifying the number or percentage of Lenders (or Lenders of any
Class) required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (or each Lender of such Class, as the case may be), (vi) release
Intermediate Holdings or any Core Loan Party from its Guarantee under the
applicable Guarantee Agreement (except as expressly provided in the applicable
Guarantee Agreement), or limit its liability in respect of such Guarantee,
without the written consent of each Lender, (vii) except as otherwise provided
in the Security Documents, release all or substantially all of the Collateral
from the Liens of the Security Documents, without the written consent of each
Lender, (viii) postpone the date of any scheduled payment of the principal
amount of any Term Loan under Section 2.10 without the written consent of each
Lender holding outstanding Term Loans, (ix) change any provisions of any Loan
Document in a manner that by its
138
terms adversely affects the rights in respect of payments due to Lenders holding
Loans of any Class differently than those holding Loans of any other Class,
without the written consent of Lenders holding a majority in interest of the
outstanding Loans and unused Commitments of each affected Class, (x) change
Section 9.15 in any way or release either Borrower from its obligations
thereunder, without the written consent of each Lender, or (xi) change the
definition of the term Interest Period to permit the Borrowers to select
interest periods of 9 or 12 months for Eurodollar Borrowings without the written
consent of each Lender affected thereby, and provided, further that (A) no such
-----------------
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent, any Issuing Bank or the Swingline Lender without the prior
written consent of the Administrative Agent, such Issuing Bank or the Swingline
Lender, as the case may be, and (B) any waiver, amendment or modification of
this Agreement that by its terms affects the rights or duties under this
Agreement of the Revolving Lenders (but not the Term Lenders) or the Term
Lenders (but not the Revolving Lenders) may be effected by an agreement or
agreements in writing entered into by Intermediate Holdings (for so long as it
is a Loan Party), the Borrowers and the requisite percentage in interest of the
affected Class of Lenders that would be required to consent thereto under this
Section if such Class of Lenders were the only Class of Lenders hereunder at the
time. Notwithstanding the foregoing, any provision of this Agreement may be
amended by an agreement in writing entered into by Intermediate Holdings (for so
long as it is a Loan Party), the Borrowers, the Required Lenders and the
Administrative Agent (and, if their rights or obligations are affected thereby,
the Issuing Bank and the Swingline Lender) if (i) by the terms of such agreement
the Commitment of each Lender not consenting to the amendment provided for
therein shall terminate upon the effectiveness of such amendment and (ii) at the
time such amendment becomes effective, each Lender not consenting thereto
receives payment in full of the principal of and interest accrued on each Loan
made by it and all other amounts owing to it or accrued for its account under
this Agreement.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrowers
----------------------------------
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of one counsel for the Administrative Agent in each applicable
jurisdiction, in connection with the syndication of the credit facilities
provided for herein, the preparation and administration of the Loan Documents or
any amendments, modifications or waivers of the provisions
139
thereof (whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Bank in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all reasonable
out-of-pocket expenses incurred by the Administrative Agent, the Documentation
Agents, the Issuing Bank or any Lender, including the reasonable fees, charges
and disbursements of one counsel each, in each applicable jurisdiction, for the
Administrative Agent, each Documentation Agent, each Issuing Bank or each
Lender, in connection with the enforcement or protection of its rights in
connection with the Loan Documents, including its rights under this Section, or
in connection with the Loans made or Letters of Credit issued hereunder,
including all such reasonable out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.
(b) The Borrowers shall indemnify the Administrative Agent, the
Documentation Agents, the Issuing Bank and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "Indemnitee")
----------
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of the commitment letter (and related
fee letters) with respect to the credit facilities contemplated hereby, any Loan
Document or any other agreement or instrument contemplated hereby, the
performance by the parties to the Loan Documents of their respective obligations
thereunder or the consummation of the Transactions or any other transactions
contemplated hereby, (ii) any Loan or Letter of Credit or the use of the
proceeds therefrom (including any refusal by the Issuing Bank to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence, Release or threatened Release of
Hazardous Materials on or from any Mortgaged Property or any other property
currently or formerly owned or operated by Intermediate Holdings, either
Borrower or any of the Subsidiaries, or any Environmental Liability related in
any way to Intermediate Holdings, either Borrower or any of the Subsidiaries, or
(iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party
140
thereto, provided that such indemnity shall not, as to any Indemnitee, be
--------
available to the extent that such losses, claims, damages, liabilities or
related expenses resulted from the gross negligence or wilful misconduct of such
Indemnitee. It is acknowledged and agreed by the parties hereto that, solely in
their capacities as Documentation Agents, and not in their capacities as
Lenders, the Documentation Agents shall have no duties hereunder.
(c) To the extent that either Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, a Documentation Agent,
the Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Administrative Agent, such
Documentation Agent, the Issuing Bank or the Swingline Lender, as the case may
be, such Lender's pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount,
provided that the unreimbursed expense or indemnified loss, claim, damage,
--------
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent, a Documentation Agent, the Issuing Bank or the
Swingline Lender in its capacity as such. For purposes hereof, a Lender's "pro
rata share" shall be determined based upon its share of the sum of the total
Revolving Exposures, outstanding Term Loans and unused Commitments at the time.
(d) To the extent permitted by applicable law, neither Intermediate
Holdings nor either Borrower shall assert, and each hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof. In addition, no Indemnitee
shall be liable for any damages arising from the use by others of information or
other materials obtained through electronic, telecommunications or other
information transmission systems.
(e) All amounts due under this Section shall be payable promptly after
written demand therefor.
(f) No director, officer, employee, stockholder or member, as such, of
any Loan Party shall have any liability for the Obligations or for any claim
based on, in respect of or by reason of the Obligations or their creation,
provided that the foregoing shall not be construed
--------
141
to relieve any Loan Party of its Obligations under any Loan Document.
SECTION 9.04. 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 permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that
neither Borrower may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by either Borrower without such consent shall
be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
the Issuing Bank and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitments and the Loans at the time owing to it), provided that (i) except
--------
in the case of (x) an assignment of Term Loans or Term Commitments to a Lender
or a Lender Affiliate and (y) an assignment of Revolving Loans or Revolving
Commitments to a Revolving Lender, each of the Cayman Borrower and the
Administrative Agent (and, in the case of (A) an assignment of all or a portion
of a Revolving Commitment or any Lender's obligations in respect of its
Swingline Exposure, the Swingline Lender and (B) an assignment of all or a
portion of a Revolving Commitment or any Lender's obligations in respect of its
LC Exposure, each Issuing Bank) must give their prior written consent to such
assignment (which consent (A) shall not be unreasonably withheld or delayed and
(B) in the case of any consent required by an Issuing Bank, shall be deemed to
have been given in the event that such Issuing Bank fails to respond in writing
to a request for consent within two Business Days of receipt thereof), (ii)
except in the case of an assignment to a Lender or a Lender Affiliate or an
assignment of the entire remaining amount of the assigning Lender's Commitments
or Loans of any Class, the amount of the Commitments or Loans of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall be (A) an
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amount not less than $1,000,000, in the case of an assignment of Term Loans or
Term Commitments, or (B) an amount not less than $5,000,000, in the case of an
assignment of Revolving Loans or Revolving Commitments, in each case unless each
of the Cayman Borrower and the Administrative Agent (and, in the case of an
assignment of all or a portion of a Revolving Commitment or any Lender's
obligations in respect of its Swingline Exposure, the Swingline Lender)
otherwise consent, which consent shall not be unreasonably withheld, (iii) each
partial assignment of an assigning Lender's rights and obligations in respect of
one Class of Commitments or Loans shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
such Class of Commitments or Loans (which, in the case of any assignment of Term
Loans, will include a proportionate part of the assigning Lender's rights and
obligations in respect of Cayman Term Loans and U.S. Term Loans of which such
Term Loans are a part), (iv) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together with
a processing and recordation fee of $3,500, and (v) the assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire, and provided further that any consent of the Cayman Borrower
----------------
otherwise required under this paragraph shall not be required if an Event of
Default under clause (a), (b), (h) or (i) of Article VII has occurred and is
continuing. Subject to acceptance and recording thereof pursuant to paragraph
(d) of this Section, from and after the effective date specified in each
Assignment and Acceptance the assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of a Lender under this Agreement (provided that any
--------
liability of each Borrower to such assignee under Section 2.15, 2.16 or 2.17
shall be limited to the amount, if any, that would have been payable thereunder
by such Borrower in the absence of such assignment and provided further that an
-------- -------
assignee that is a Foreign Lender shall not be entitled to the benefits of
Section 2.17 unless such assignee agrees to comply with the requirements of
Section 2.17(e)), and the assigning Lender thereunder shall, to the extent of
the interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.15, 2.16, 2.17 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this
143
paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent of
the Borrowers, shall maintain at one of its offices in The City of New York a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing by each Borrower
to, each Lender pursuant to the terms hereof from time to time (the "Register").
--------
The entries in the Register shall be conclusive, and Intermediate Holdings, the
Borrowers, the Administrative Agent, the Issuing Bank and the Lenders may treat
each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement, notwithstanding notice
to the contrary. The Register shall be available for inspection by the
Borrowers, the Issuing Bank and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Acceptance and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of either Borrower, the
Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations (which, in the case of any participations in Term Loans, will
include a proportionate part of the assigning Lender's rights and obligations in
respect of the Cayman Term Loans and the U.S. Term Loans included in the
Borrowing of which such Term Loans are a part) to one or more banks or other
entities (a "Participant") in all or a portion of such Lender's rights and
-----------
obligations under this Agreement (including all or a portion of its Commitment
and the Loans owing to it), provided that (i) such Lender's obligations under
--------
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for
144
the performance of such obligations and (iii) Intermediate Holdings, the
Borrowers, the Administrative Agent, the Issuing Bank and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment, modification or waiver of any provision of the Loan
Documents, provided that such agreement or instrument may provide that such
--------
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that
affects such Participant. Subject to paragraph (f) of this Section, the
Borrowers agree that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 9.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.18(c) as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.15 or 2.17 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the applicable
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.17 unless
the applicable Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the applicable
Borrower, to comply with Section 2.17(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest, provided that no such pledge or assignment of
--------
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or assignee for such Lender as a party hereto. In
the case of any Lender that is a fund that invests in bank loans, such Lender
may, without the consent of the Borrowers or the Administrative Agent, assign or
pledge all or any portion of any instrument evidencing its rights as a Lender
under this Agreement to
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any trustee for, or any other representative of holders of obligations owed or
securities issued by, such fund, as security for such obligations or securities,
provided that any foreclosure or similar action by such trustee or
representative shall be subject to the provisions of this Section 9.02
concerning assignments.
(h) In the event that S&P or ▇▇▇▇▇'▇ shall, after the date that any
Revolving Lender becomes a Lender, downgrade the long-term certificate deposit
ratings or long-term senior unsecured debt ratings of such Lender (or the parent
company thereof), and the resulting ratings shall be BBB+ or lower by S&P or
Baa1 or lower by ▇▇▇▇▇'▇, then the Swingline Lender shall have the right, but
not the obligation, at its own expense, upon notice to such Lender, the
Administrative Agent and the Cayman Borrower, to replace (or to request the
Cayman Borrower, at the sole expense of the Swingline Lender, to use its
reasonable efforts to replace) such Lender with respect to such Lender's
Revolving Commitment with an assignee (in accordance with and subject to the
restrictions contained in paragraph (b) above, including the right of the
Borrowers and the Administrative Agent to consent to the identity of such
assignee (which consent shall not be unreasonably withheld)), and such Lender
hereby agrees to transfer and assign without recourse (in accordance with and
subject to the restrictions contained in paragraph (b) above) all its interests,
rights and obligations in respect of its Revolving Commitment to such assignee;
provided, however, that (i) no such assignment shall conflict with any law, rule
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and regulation or order of any Governmental Authority and (ii) such assignee
shall pay to such Lender in immediately available funds on the date of such
assignment the principal of and interest and fees accrued to the date of payment
on the Loans and LC Disbursements of such Lender hereunder.
(i) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (an
---------------
"SPV"), identified as such in writing from time to time by the Granting Lender
---
to the Administrative Agent and the Cayman Borrower, the option to provide to
either Borrower all or any part of any Loan that such Granting Lender would
otherwise be obligated to make to such Borrower pursuant to this Agreement,
provided that (i) nothing herein shall constitute a commitment by any SPV to
--------
make any Loan or, except as provided in the immediately succeeding sentence,
affect in any way the Commitment of the Granting Lender and (ii) if an SPV
elects not to exercise such option or otherwise fails to provide all or any part
of such Loan, the Granting Lender shall be obligated to make such Loan pursuant
to the terms
146
hereof. The making of a Loan by an SPV hereunder shall utilize the Commitment of
the Granting Lender to the same extent, and as if, such Loan were made by such
Granting Lender. In the event that an SPV provides all or any part of any Loan,
Intermediate Holdings, the Borrowers and the Administrative Agent shall continue
to deal solely and directly with the Granting Lender with respect to such Loan,
including with respect to the giving of notices and the delivery of financial
statements, certificates and other documents (including pursuant to Section 5)
and information. Each party hereto hereby agrees that no SPV shall be (i) liable
for any indemnity or similar payment obligation under this Agreement (all
liability for which shall remain with the Granting Lender), (ii) have any voting
rights under Section 9.02 or Article VII or with respect to any other matter
under this Agreement to which the Lenders are entitled to give their consent
(all of which voting rights shall remain with the Granting Lender) or (iii)
entitled to receive any greater amount pursuant to Section 2.15, 2.16, 2.17 or
9.03 than the Granting Lender would have been entitled to receive in respect of
the amount of any Loan provided by the SPV if the Granting Lender had in fact
made such Loan. In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPV, it will
not institute against, or join any other person in instituting against, such SPV
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof. In
addition, notwithstanding anything to the contrary in this Section 9.04, any SPV
may (i) with notice to, but without the prior written consent of, the Cayman
Borrower and the Administrative Agent and without paying any processing fee
therefor, assign all or a portion of its interests in any Loans to the Granting
Lender or to any financial institutions (consented to by the Cayman Borrower and
the Administrative Agent) providing liquidity and/or credit support to or for
the account of such SPV to support the funding or maintenance of Loans and (ii)
disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPV. As this Section
9.04(i) applies to any particular SPV, this Section may not be amended without
the written consent of such SPV.
SECTION 9.05. Survival. All covenants, agreements, representations and
---------
warranties made by the Loan Parties in the Loan Documents and in the
certificates or
147
other instruments delivered in connection with or pursuant to this Agreement or
any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Administrative Agent, the Issuing Bank or any
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement
-----------------------------------------
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the other
Loan Documents and any separate letter agreements with respect to fees payable
to the Administrative Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof that, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.
SECTION 9.07. Severability. Any provision of this Agreement held to be
-------------
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality
148
and enforceability of the remaining provisions hereof; and the invalidity of a
particular provision in a particular jurisdiction shall not invalidate such
provision in any other jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
----------------
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of either
Borrower against any of and all the obligations of the applicable Borrower then
existing under this Agreement (to the extent such obligations of either Borrower
are then due and payable (by acceleration or otherwise)) held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement. The rights of each Lender under this Section are in addition to other
rights and remedies (including other rights of setoff) that such Lender may
have.
SECTION 9.09. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
--------------------------------------------------
PROCESS. (a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
--------
BY THE LAW OF THE STATE OF NEW YORK.
(b) Each of Intermediate Holdings, the Borrowers, the Administrative
Agent, each Issuing Bank and each Lender hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to any Loan Document, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State court or, to the extent permitted by law,
in such Federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement or any other Loan Document shall affect any right
that the Administrative Agent, the Issuing Bank or any Lender may otherwise have
to bring any action or proceeding relating to this Agreement or any other Loan
Document against
149
Intermediate Holdings, the Borrowers or their properties in the courts of any
jurisdiction.
(c) Each of Intermediate Holdings and the Borrowers hereby irrevocably
and unconditionally waives, to the fullest extent it may legally and effectively
do so, any objection that it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
any other Loan Document in any court referred to in paragraph (b) of this
Section. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law. Intermediate
Holdings, the Cayman Borrower and each of the Subsidiary Loan Parties that is
not organized or incorporated in the United States hereby appoints the U.S.
Borrower as agent for service of process in the United States and the U.S.
Borrower hereby accepts such appointment.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
---------------------
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table of
---------
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the
----------------
Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information
150
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section (or an agreement to be bound by the provisions of this
Section 9.12), to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement, or (ii) any actual or prospective direct or indirect contractual
counterparties in swap or other derivative agreements or such contractual
counterparties' professional advisors, (g) with the consent of either Borrower,
(h) to the extent such Information (i) becomes publicly available other than as
a result of a breach of this Section or (ii) becomes available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
from a source other than Intermediate Holdings or the Borrowers or (i) to any
nationally recognized rating agency that requires access to information about a
Lender's investment portfolio in connection with ratings issued with respect to
such Lender. In the case of any disclosure of Information pursuant to clause (c)
or clause (e) of the preceding sentence, the Administrative Agent will inform
the Borrowers of such disclosure. For the purposes of this Section, the term
"Information" means all information received from Intermediate Holdings or
-----------
either Borrower relating to Intermediate Holdings or the Borrowers or their
business, other than any such information that is available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
prior to disclosure by Intermediate Holdings or a Borrower. Any Person required
to maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything
-------------------------
herein to the contrary, if at any
151
time the interest rate applicable to any Loan, together with all fees, charges
and other amounts that are treated as interest on such Loan under applicable law
(collectively the "Charges"), shall exceed the maximum lawful rate (the "Maximum
------- -------
Rate") that may be contracted for, charged, taken, received or reserved by the
----
Lender holding such Loan in accordance with applicable law, the rate of interest
payable in respect of such Loan hereunder, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of such Loan
but were not payable as a result of the operation of this Section shall be
cumulated and the interest and Charges payable to such Lender in respect of
other Loans or periods shall be increased (but not above the Maximum Rate
therefor) until such cumulated amount, together with interest thereon at the
Federal Funds Effective Rate to the date of repayment, shall have been received
by such Lender.
SECTION 9.14. Judgment Currency. (a) The Borrowers' obligations
------------------
hereunder and each Borrower's and the other Loan Parties' obligations under the
other Loan Documents to make payments in Dollars (the "Obligation Currency")
-------------------
shall not be discharged or satisfied by any tender or recovery pursuant to any
judgment expressed in or converted into any currency other than the Obligation
Currency, except to the extent that such tender or recovery results in the
effective receipt by the Administrative Agent, the Collateral Agent or a Lender
of the full amount of the Obligation Currency expressed to be payable to the
Administrative Agent, the Collateral Agent or such Lender under this Agreement
or the other Loan Documents. If, for the purpose of obtaining or enforcing
judgment against the Borrower or any other Loan Party in any court or in any
jurisdiction, it becomes necessary to convert into or from any currency other
than the Obligation Currency (such other currency being hereinafter referred to
as the "Judgment Currency") an amount due in the Obligation Currency, the
-----------------
conversion shall be made, at the rate of exchange (as quoted by the
Administrative Agent or, if the Administrative Agent does not quote a rate of
exchange on such currency, by a known dealer in such currency designated by the
Administrative Agent) determined, in each case, as of the date immediately
preceding the day on which the judgment is given (such Business Day being
hereinafter referred to as the "Judgment Currency Conversion Date").
---------------------------------
(b) If there is a change in the rate of exchange prevailing between
the Judgment Currency Conversion Date and the date of actual payment of the
amount due, the Borrowers covenant and agree to pay, or cause to be paid, such
152
additional amounts, if any (but in any event not a lesser amount), as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency that could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the rate of exchange for this Section,
such amounts shall include any premium and costs payable in connection with the
purchase of the Obligation Currency.
SECTION 9.15. Joint and Several Liability. Notwithstanding any
----------------------------
provision contained herein or in any other Loan Document to the contrary, each
of the Cayman Borrower and the U.S. Borrower agrees and acknowledges that the
Cayman Borrower and the U.S. Borrower shall be jointly and severally liable for
all of the Obligations arising hereunder and under the other Loan Documents,
including principal of, interest on, and any fees, expenses, indemnities and
premium payable in respect of, each of the Cayman Term Loans and the U.S. Term
Loans.
ARTICLE X
Collection Allocation Mechanism
-------------------------------
SECTION 10.01. Implementation of CAM. (a) On the CAM Exchange Date,
----------------------
(i) the Commitments shall automatically and without further act be terminated as
provided in Section 7.01, (ii) each Revolving Lender shall immediately be deemed
to have acquired (and shall promptly make payment therefor to the Administrative
Agent in accordance with Section 2.04(c)) participations in the Swingline Loans
in an amount equal to such Revolving Lender's Applicable Percentage of each
Swingline Loan outstanding on such date and (iii) the Lenders shall
automatically and without further act (and without regard to the provisions of
Section 9.04) be deemed to have exchanged interests in the Loans (other than the
Swingline Loans) and, in the case of the Revolving Lenders, participations in
Swingline Loans and Letters of Credit such that in lieu of the interest of each
Lender in each Loan and Letter of Credit in which it shall participate as of
such date (including such Lender's interest in the Obligations of each Loan
Party in respect of each such Loan and Letter of Credit), such Lender shall hold
an interest in every one of the Loans (other than the Swingline Loans) and a
153
participation in every one of the Swingline Loans and Letters of Credit
(including the Obligations of each Loan Party in respect of each such Loan and
each LC Reserve Account established pursuant to Section 10.02 below), whether or
not such Lender shall previously have participated therein, equal to such
Lender's CAM Percentage thereof. Each Lender and each Loan Party hereby consents
and agrees to the CAM Exchange, and each Lender agrees that the CAM Exchange
shall be binding upon its successors and assigns and any person that acquires a
participation in its interests in any Loan. Each Loan Party agrees from time to
time to execute and deliver to the Administrative Agent all such Notes and other
instruments and documents as the Administrative Agent shall reasonably request
to evidence and confirm the respective interests of the Lenders after giving
effect to the CAM Exchange, and each Lender agrees to surrender any Notes
originally received by it in connection with its Loans hereunder to the
Administrative Agent against delivery of new Notes evidencing its interests in
the Loans; provided, however, that the failure of any Loan Party to execute or
-------- -------
deliver or of any Lender to accept any such Note, instrument or document shall
not affect the validity or effectiveness of the CAM Exchange.
(b) As a result of the CAM Exchange, upon and after the CAM Exchange
Date, each payment received by the Administrative Agent or the Collateral Agent
pursuant to any Loan Document in respect of the Obligations, and each
distribution made by the Collateral Agent pursuant to any Security Document in
respect of the Obligations, shall be distributed to the Lenders pro rata in
accordance with their respective CAM Percentages. Any direct payment received by
a Lender upon or after the CAM Exchange Date, including by way of setoff, in
respect of an Obligation shall be paid over to the Administrative Agent for
distribution to the Lenders in accordance herewith.
SECTION 10.02. Letters of Credit. (a) In the event that on the CAM
------------------
Exchange Date any Letter of Credit shall be outstanding and undrawn in whole or
in part, or any LC Disbursement shall not have been reimbursed either by the
Cayman Borrower or, in the case of any LC Disbursement made in dollars, with the
proceeds of a Revolving Borrowing, each Revolving Lender shall promptly pay over
to the Administrative Agent, in immediately available funds, an amount in
dollars equal to such Revolving Lender's Applicable Percentage of such undrawn
face amount (or, in the case of any Alternative Currency Letter of Credit, the
Dollar Equivalent of such face amount) or (to the extent it has not already done
so) such unreimbursed drawing, as the case may be, together with interest
thereon from the CAM
154
Exchange Date to the date on which such amount shall be paid to the
Administrative Agent at the rate that would be applicable at the time to an ABR
Revolving Loan in a principal amount equal to such amount. The Administrative
Agent shall establish a separate account or accounts for each Lender (each, an
"LC Reserve Account") for the amounts received with respect to each such Letter
of Credit pursuant to the preceding sentence. The Administrative Agent shall
deposit in each Lender's LC Reserve Account such Lender's CAM Percentage of the
amounts received from the Revolving Lenders as provided above, provided that in
--------
the case of amounts received in respect of Alternative Currency Letters of
Credit, the Administrative Agent may, in its sole discretion, convert any or all
of such amounts into the applicable Alternative Currency immediately prior to
any withdrawal from the LC Reserve Account pursuant to paragraph (b) below. The
Administrative Agent shall have sole dominion and control over each LC Reserve
Account, and the amounts deposited in each LC Reserve Account shall be held in
such LC Reserve Account until withdrawn as provided in paragraph (b) or (c)
below. The Administrative Agent shall maintain records enabling it to determine
the amounts paid over to it and deposited in the LC Reserve Accounts in respect
of each Letter of Credit and the amounts on deposit in respect of each Letter of
Credit attributable to each Lender's CAM Percentage. The amounts held in each
Lender's LC Reserve Account shall be held as a reserve against the LC Exposures,
shall be the property of such Lender, shall not constitute Loans to or give rise
to any claim of or against any Loan Party and shall not give rise to any
obligation on the part of either Borrower to pay interest to such Lender, it
being agreed that the reimbursement obligations in respect of Letters of Credit
shall arise only at such times as drawings are made thereunder, as provided in
Section 2.05.
(b) In the event that after the CAM Exchange Date any drawing shall be
made in respect of a Letter of Credit, the Administrative Agent shall, at the
request of the Issuing Bank, withdraw from the LC Reserve Account of each Lender
any amounts, up to the amount of such Lender's CAM Percentage of such drawing,
deposited in respect of such Letter of Credit and remaining on deposit and
deliver such amounts to the Issuing Bank in satisfaction of the reimbursement
obligations of the Revolving Lenders under Section 2.05(d) (but not of the
Cayman Borrower under Section 2.05(e)). In the event that any Revolving Lender
shall default on its obligation to pay over any amount to the Administrative
Agent in respect of any Letter of Credit as provided in this Section 10.02, the
Issuing Bank shall, in the event of a drawing thereunder, have a claim against
155
such Revolving Lender to the same extent as if such Lender had defaulted on its
obligations under Section 2.05(d), but shall have no claim against any other
Lender in respect of such defaulted amount, notwithstanding the exchange of
interests in the Cayman Borrower's reimbursement obligations pursuant to Section
10.01. Each other Lender shall have a claim against such defaulting Revolving
Lender for any damages sustained by it as a result of such default, including,
in the event that such Letter of Credit shall expire undrawn, its CAM Percentage
of the defaulted amount.
(c) In the event that after the CAM Exchange Date any Letter of Credit
shall expire undrawn, the Administrative Agent shall withdraw from the LC
Reserve Account of each Lender the amount remaining on deposit therein in
respect of such Letter of Credit and distribute such amount to such Lender.
(d) With the prior written approval of the Administrative Agent (not
to be unreasonably withheld), any Lender may withdraw the amount held in its LC
Reserve Account in respect of the undrawn amount of any Letter of Credit. Any
Lender making such a withdrawal shall be unconditionally obligated, in the event
there shall subsequently be a drawing under such Letter of Credit, to pay over
to the Administrative Agent, for the account of the applicable Issuing Bank, on
demand, its CAM Percentage of such drawing.
(e) Pending the withdrawal by any Lender of any amounts from its LC
Reserve Account as contemplated by the above paragraphs, the Administrative
Agent will, at the direction of such Lender and subject to such rules as the
Administrative Agent may prescribe for the avoidance of inconvenience, invest
such amounts in Permitted Investments. Each Lender that has not withdrawn its
amounts in its LC Reserve Account as provided in paragraph (d) above shall have
the right, at intervals reasonably specified by the Administrative Agent, to
withdraw the earnings on investments so made by the Administrative Agent with
amounts in its LC Reserve Account and to retain such earnings for its own
account.
156
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.
SEAGATE TECHNOLOGY HOLDINGS,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
Credit Agreement
157
SEAGATE TECHNOLOGY HDD HOLDINGS,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
Credit Agreement
SEAGATE TECHNOLOGY (US) HOLDINGS, INC.,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
Credit Agreement
JPMORGAN CHASE BANK, individually
and as Administrative Agent,
by /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
Credit Agreement
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING,
INC., individually and as
Syndication Agent,
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
Credit Agreement
▇▇▇▇▇▇▇ ▇▇▇▇▇ CAPITAL CORPORATION,
individually and as a
Documentation Agent,
by /s/ ▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇
Title: Vice President
Credit Agreement
CITICORP USA, INC., individually and
as a Documentation Agent,
by /s/ Arman Spieget
----------------------------------
Name: Arman Spieget
Title: Vice President
Credit Agreement
CREDIT SUISSE FIRST BOSTON,
individually and as a
Documentation Agent,
by /s/ ▇▇▇▇▇▇ ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: Director
/s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Associate
Credit Agreement
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY ___, 2002
Name of Institution:
The Bank of Nova Scotia
----------------------------------------------
by /s/ ▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Director
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY ___, 2002
Name of Institution:
CREDIT LYONNAIS NEW YORK BRANCH
--------------------------------------------
by /s/ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY ___, 2002
Name of Institution:
KEY CORPORATE CAPITAL, INC.
individually and as Senior Managing Agent
--------------------------------------------
by /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY ___, 2002
Name of Institution: BNP Paribas, individually
and as Senior Managing Agent
BNP Paribas
--------------------------------------------
by /s/ Pjalling ▇▇▇▇▇▇▇▇
----------------------------------------
Name: Pjalling ▇▇▇▇▇▇▇▇
Title: Director
by /s/ ▇▇▇▇▇▇ ▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇
Title: Director
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY ___, 2002
Name of Institution:
Lloyds TSB Bank PLC
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Director
by /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
Credit Services
B-499
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY 10, 2002
Name of Institution:
General Electric Capital Corporation
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: DULY AUTHORIZED SIGNATORY
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
Metropolitan Life Insurance Company
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇. Lingtor
----------------------------------------
Name: ▇▇▇▇▇ ▇. Lingtor
Title: Director
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
MONY Life Insurance Company
By: MONY Capital Management, Inc.,
as Investment Adviser
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Managing Director
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
MONY Life Insurance Company of America
By: MONY Capital Management, Inc.
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH Cypress Tau - 1 LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: AUTHORIZED AGENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH ING - 2 LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH Pondview LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH Riverside LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH Waterside LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
TRAVELERS CORPORATE
LOAN FUND INC.
By Travelers Asset Management
International Company, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: ASSISTANT INVESTMENT OFFICER
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
KZH Sterling LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
Title: Authorized Agent
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
▇▇▇▇▇▇▇▇▇▇▇ Senior Floating Rate
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
STANWICH LOAN FUNDING LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY 13, 2002
Name of Institution:
▇▇▇▇▇▇▇ FLOATING RATE FUND
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
The Sumitomo Trust & Banking Co., Ltd.
New York Branch
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
▇▇▇▇▇ ▇▇▇ Floating Rate Limited Liability
Company
--------------------------------------------
by /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
▇▇▇▇▇ ▇▇▇ & Farnham Incorporated,
as Advisor to the ▇▇▇▇▇ ▇▇▇
Floating Rate Limited Liability
Company
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
SRF TRADING, INC.
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: ASST. VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
SRF 2000 LLC
--------------------------------------------
by /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: ASST. VICE PRESIDENT
SIGNATURE PAGE
TO THE CREDIT
AGREEMENT DATED
AS OF MAY __, 2002
Name of Institution:
CypressTree Investment Management Company, Inc.
As: Attorney-in-Fact and on behalf of First
Allmerica Financial Life Insurance Company
as Portfolio Manager
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: PRINCIPAL
Credit Agreement
189
SCHEDULE 1.02
Jurisdictions of Core Loan Parties
----------------------------------
United States
Cayman Islands
Japan
Mexico
Singapore
Thailand
190
SCHEDULE 2.05(a)
Existing Letters of Credit
--------------------------
Date of Issuance Issuer Applicant Beneficiary Amount and Currency
---------------- ------ --------- ----------- -------------------
Expiration Date
---------------
191
SCHEDULE 5.01
Line Items to be Included in Selected Unaudited Consolidated
------------------------------------------------------------
Financial Information of the Cayman Borrower
--------------------------------------------
Statement of Operations Data:
Revenue
Cost of revenue
Product development
Marketing and administrative
Amortization of good will and other intangibles
In-process research and development
Restructuring
Unusual items
Income (loss) from operations
Other income (expense):
Interest income
Interest expense
Other non-operating income (expense)
Income (loss) before income taxes
Benefit (provision) for income taxes
Net income (loss)
Balance Sheet Data (at end of period):
Cash and cash equivalents
Short-term investments
Total assets
Total debt (including current portion of long-term debt)
Total shareholder's equity
Other Financial Data:
EBITDA
Depreciation and amortization
Capital expenditures, net
Working capital
Cash interest expense
Ratio of earnings to fixed charges
EBITDA/interest expense
Total debt/EBITDA
Net debt/EBITDA
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities