CONFORMED COPY
REEBOK INTERNATIONAL LTD.
____________________
$1,700,000,000
CREDIT AGREEMENT
dated as of August 23, 1996
____________________
CREDIT SUISSE,
as Administrative Agent
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS. . . . . . . . . . . . . . . 1
1.1 Defined Terms . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . 22
SECTION 2. AMOUNT AND TERMS OF TERM LOAN COMMITMENTS.23
2.1 Term Loans. . . . . . . . . . . . . . . . 23
2.2 Procedure for Term Loan Borrowing . . . . 23
2.3 Amortization of Term Loans. . . . . . . . 23
2.4 Use of Proceeds of Term Loans . . . . . . 24
SECTION 3. AMOUNT AND TERMS OF REVOLVING CREDIT
COMMITMENTS. . . . . . . . . . . . . . . 24
3.1 Revolving Credit Commitments. . . . . . . 24
3.2 Procedure for Revolving Credit Borrowing. 24
3.3 Use of Proceeds of Revolving Credit Loans 25
SECTION 4. AMOUNT AND TERMS OF LETTER OF CREDIT SUB-
FACILITY. . . . . . . . . . . . . . . . 25
4.1 L/C Commitment. . . . . . . . . . . . . . 25
4.2 Procedure for Issuance of Letters of Credit26
4.3 Fees, Commissions and Other Charges.. . . 26
4.4 L/C Participations. . . . . . . . . . . . 28
4.5 Reimbursement Obligation of the Borrower. 29
4.6 Obligations Absolute. . . . . . . . . . . 29
4.7 Letter of Credit Payments.. . . . . . . . 30
4.8 Application.. . . . . . . . . . . . . . . 30
4.9 Reporting by Issuing Banks. . . . . . . . 30
4.10 Existing Standby Letters of Credit. . . . 30
SECTION 5. PROVISIONS RELATING TO THE EXTENSIONS OF
CREDIT; FEES AND PAYMENTS. . . . . . . . 31
5.1 Repayment of Loans; Evidence of Debt. . . 31
5.2 Commitment Fee. . . . . . . . . . . . . . 32
5.3 Optional Prepayments. . . . . . . . . . . 32
5.4 Optional Termination or Reduction of
Commitment . . . . . . . . . . . . . . . 32
5.5 Mandatory Reduction of Commitments and
Prepayments . . . . . . . . . . . . . . . 32
5.6 Conversion and Continuation Options . . . 34
5.7 Minimum Amounts and Maximum Number of
Tranches . . . . . . . . . . . . . . . 34
5.8 Interest Rates and Payment Dates. . . . . 35
5.9 Computation of Interest and Fees. . . . . 35
5.10 Inability to Determine Interest Rate. . . 36
5.11 Pro Rata Treatment and Payments . . . . . 36
5.12 Illegality. . . . . . . . . . . . . . . . 37
5.13 Requirements of Law . . . . . . . . . . . 37
5.14 Taxes . . . . . . . . . . . . . . . . . . 38
5.15 Indemnity . . . . . . . . . . . . . . . . 40
5.16 Change of Lending Office. . . . . . . . . 41
5.17 Additional Action in Certain Events . . . 41
SECTION 6. REPRESENTATIONS AND WARRANTIES . . . . . 42
6.1 Financial Condition . . . . . . . . . . . 42
6.2 No Change . . . . . . . . . . . . . . . . 42
6.3 Pro Forma Balance Sheet . . . . . . . . . 42
6.4 Disclosure. . . . . . . . . . . . . . . . 43
6.5 Corporate Existence; Compliance with Law. 43
6.6 Corporate Power; Authorization; Enforceable
Obligations . . . . . . . . . . . . . . . 43
6.7 No Legal Bar. . . . . . . . . . . . . . . 44
6.8 No Material Litigation. . . . . . . . . . 44
6.9 No Default. . . . . . . . . . . . . . . . 44
6.10 Ownership of Property; Liens. . . . . . . 44
6.11 Intellectual Property . . . . . . . . . . 44
6.12 No Burdensome Restrictions. . . . . . . . 45
6.13 Taxes . . . . . . . . . . . . . . . . . . 45
6.14 Federal Regulations . . . . . . . . . . . 45
6.15 ERISA . . . . . . . . . . . . . . . . . . 45
6.16 Investment Company Act; Other Regulations 46
6.17 Subsidiaries. . . . . . . . . . . . . . . 46
6.18 Environmental Matters . . . . . . . . . . 46
6.19 Pledge Agreements . . . . . . . . . . . . 47
6.20 Security Agreements . . . . . . . . . . . 47
6.21 Guarantees. . . . . . . . . . . . . . . . 48
6.22 Solvency. . . . . . . . . . . . . . . . . 48
SECTION 7. CONDITIONS PRECEDENT . . . . . . . . . . 48
7.1 Conditions to Initial Extensions of
Credit . . . . . . . . . . . . . . . . . 48
7.2 Conditions to Each Extension of Credit. . 51
SECTION 8. AFFIRMATIVE COVENANTS. . . . . . . . . . 52
8.1 Financial Statements. . . . . . . . . . . 52
8.2 Certificates; Other Information . . . . . 53
8.3 Payment of Obligations. . . . . . . . . . 54
8.4 Conduct of Business and Maintenance of
Existence . . . . . . . . . . . . . . . . 54
8.5 Maintenance of Property; Insurance. . . . 54
8.6 Inspection of Property; Books and Records;
Discussions . . . . . . . . . . . . . . . 54
8.7 Notices . . . . . . . . . . . . . . . . . 55
8.8 Environmental Laws. . . . . . . . . . . . 56
8.9 Further Assurances. . . . . . . . . . . . 56
8.10 Additional Collateral . . . . . . . . . . 56
8.11 Interest Rate Hedging . . . . . . . . . . 58
SECTION 9. NEGATIVE COVENANTS . . . . . . . . . . . 58
9.1 Financial Condition Covenants . . . . . . 58
9.2 Limitation on Indebtedness and Preferred
Stock . . . . . . . . . . . . . . . . . 60
9.3 Limitation on Liens . . . . . . . . . . . 61
9.4 Limitation on Guarantee Obligations . . . 63
9.5 Limitation on Fundamental Changes . . . . 63
9.6 Limitation on Sale of Assets. . . . . . . 63
9.7 Limitation on Dividends . . . . . . . . . 64
9.8 Limitation on Capital Expenditures. . . . 65
9.9 Limitation on Investments, Loans and
Advances . . . . . . . . . . . . . . . . 65
9.10 Limitation on Optional Payments and
Modifications of Debt Instruments . . . . 66
9.11 Limitation on Transactions with Affiliates 66
9.12 Limitation on Sales and Leasebacks. . . . 66
9.13 Limitation on Changes in Fiscal Year. . . 67
9.14 Limitation on Negative Pledge Clauses . . 67
9.15 Limitation on Lines of Business . . . . . 67
SECTION 10. EVENTS OF DEFAULT . . . . . . . . . . . 67
SECTION 11. THE ADMINISTRATIVE AGENT. . . . . . . . 71
11.1 Appointment. . . . . . . . . . . . . . . 71
11.2 Delegation of Duties . . . . . . . . . . 71
11.3 Exculpatory Provisions . . . . . . . . . 71
11.4 Reliance by Administrative Agent . . . . 72
11.5 Notice of Default. . . . . . . . . . . . 72
11.6 Non-Reliance on Administrative Agent and
Other Lenders. . . . . . . . . . . . . . 72
11.7 Indemnification. . . . . . . . . . . . . 73
11.8 Administrative Agent and Co-Agents in
their Individual Capacities. . . . . . . 73
11.9 Successor Administrative Agent . . . . . 74
SECTION 12. MISCELLANEOUS . . . . . . . . . . . . . 74
12.1 Amendments and Waivers . . . . . . . . . 74
12.2 Releases of Collateral Security and
Guarantee Obligations. . . . . . . . . . 75
12.3 Notices. . . . . . . . . . . . . . . . . 75
12.4 No Waiver; Cumulative Remedies . . . . . 76
12.5 Survival of Representations and
Warranties. . . . . . . . . . . . . . . 76
12.6 Payment of Expenses and Taxes. . . . . . 76
12.7 Successors and Assigns; Participations
and Assignments. . . . . . . . . . . . . 77
12.8 Adjustments; Set-off . . . . . . . . . . 80
12.9 Judgment Currency. . . . . . . . . . . . 80
12.10 Collateral Agency Agreement. . . . . . . 81
12.11 Matters Relating to Certain Collateral . 81
12.12 Counterparts . . . . . . . . . . . . . . 81
12.13 Confidentiality. . . . . . . . . . . . . 81
12.14 Severability . . . . . . . . . . . . . . 82
12.15 Integration. . . . . . . . . . . . . . . 82
12.16 GOVERNING LAW. . . . . . . . . . . . . . 82
12.17 Submission To Jurisdiction; Waivers. . . 82
12.18 Acknowledgements . . . . . . . . . . . . 83
12.19 WAIVERS OF JURY TRIAL. . . . . . . . . . 83
SCHEDULES
Schedule I Lenders; Addresses for Notices
Schedule II Commitments; Commitment Percentages
Schedule III Subsidiaries
Schedule IV UCC Financing Statements
Schedule V Indebtedness
Schedule VI Liens
Schedule VII Guarantees
Schedule VIII Existing Letters of Credit
Schedule IX Existing Investments
EXHIBITS
Exhibit A Form of Term Loan Note
Exhibit B Form of Revolving Credit Note
Exhibit C Form of Borrower Security Agreement
Exhibit D Form of Borrower Domestic Stock Pledge Agreement
Exhibit E Form of Subsidiaries Guarantee
Exhibit F Form of Subsidiaries Security Agreement
Exhibit G Form of Subsidiaries Domestic Stock Pledge
Agreement
Exhibit H Form of Collateral Agency Agreement
Exhibit I-1 Form of Opinion of Ropes & ▇▇▇▇
Exhibit I-2 Form of Opinion of General Counsel
Exhibit I-3 Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Exhibit J Form of Assignment and Acceptance
Exhibit K-1 Form of Notice of Borrowing (Drawings)
Exhibit K-2 Form of Notice of Borrowing (Conversions)
Exhibit K-3 Form of Notice of Borrowing (Continuations)
CREDIT AGREEMENT, dated as of August 23, 1996, among:
(a) REEBOK INTERNATIONAL LTD., a Massachusetts corporation (the
"Borrower");
(b) the several banks and other financial institutions from time
to time parties to this Agreement (the "Lenders");
(c) each of the co-agents listed on the signature pages hereto
(the "Co-Agents"); and
(d) CREDIT SUISSE, a Swiss banking corporation, as
administrative agent (in such capacity, the "Administrative
Agent") for the Lenders hereunder.
W I T N E S S E T H:
WHEREAS, the Borrower has commenced a tender offer to
acquire up to 24,000,000 shares (subject to increase to up to
25,440,000 shares) of its common stock at a price of $30-36 per
share, pursuant to a "Dutch auction" process (the "Repurchase");
WHEREAS, the Borrower has requested that the Lenders
make available to it credit facilities of up to $1,700,000,000 in
the aggregate upon the terms, and subject to the conditions, set
forth herein;
WHEREAS, the Administrative Agent and the Lenders are
willing to provide such financing to the Borrower only upon the
terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein, the parties hereto hereby
agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABR": for any day, a rate per annum equal to 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 ABR due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day
of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"ABR Loans": Loans the rate of interest applicable to
which is based upon the ABR.
"Administrative Agent": as defined in the preamble to
this Agreement.
"Affiliate": as to any Person, any other Person (other
than a Subsidiary) which, directly or indirectly, is in
control of, is controlled by, or is under common control
with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or
indirectly, either to (a) vote 10% or more of the securities
having ordinary voting power for the election of directors
of such Person or (b) direct or cause the direction of the
management and policies of such Person, whether by contract
or otherwise.
"Aggregate Outstanding Extensions of Credit": as to
any Lender at any time, an amount equal to the sum of (a)
the aggregate principal amount of all Revolving Credit Loans
made by such Lender then outstanding and (b) such Lender's
Revolving Credit Commitment Percentage of the L/C
Obligations then outstanding.
"Agreement": this Credit Agreement, as amended,
supplemented or otherwise modified from time to time.
"Applicable Commitment Fee Rate": (a) for each day on
which the Borrower has an Investment Grade Rating, the rate
per annum set forth below opposite the Credit Rating then in
effect:
Credit Rating Rate
BBB+ or better by S&P and 15 b.p.
Baa1 or better by ▇▇▇▇▇'▇
BBB or better by S&P and 20 b.p.
Baa2 or better by ▇▇▇▇▇'▇,
but not BBB+ or better by
S&P and Baa1 or better by
▇▇▇▇▇'▇
BBB- or better by S&P and 25 b.p.
Baa3 or better by ▇▇▇▇▇'▇,
but not BBB or better by
S&P and Baa2 or better by
▇▇▇▇▇'▇
(b) for each day on which the Borrower does not have
an Investment Grade Rating, the rate per annum set forth
below opposite the Pricing Ratio then in effect:
Pricing Ratio Rate
Greater than 3.75 to 1.00 50 b.p.
Less than or equal to 3.75 37.5 b.p.
to 1.00, but greater than
3.25 to 1.0
Less than or equal to 3.25 35 b.p.
to 1.00, but greater than
2.75 to 1.0
Less than or equal to 2.75 31.25 b.p.
to 1.00, but greater than
2.25 to 1.0
Less than or equal to 2.25 27.5 b.p.
to 1.00, but greater than
1.75 to 1.0
Less than or equal to 1.75 25 b.p.
to 1.00, but greater than
1.25 to 1.0
Less than or equal to 1.25 20 b.p.
to 1.00
;provided, however, that, in the event that the financial
statements required to be delivered pursuant to subsection
8.1(a) or (b), as applicable, are not delivered when due,
then (notwithstanding the provisions of subsection 5.9)
during the period from the date upon which such financial
statements were required to be delivered until the date upon
which they actually are delivered, the Pricing Ratio shall
be deemed for purposes of this definition to be greater than
3.75 to 1.0.
"Applicable Margin": for each Type of Loan:
(a) for each day on which the Borrower has an
Investment Grade Rating, the rate per annum set forth below
opposite the Credit Rating then in effect:
Applicable Margin
Credit Rating ABR Loans Eurodollar Loans
BBB+ or better by S&P and 0 b.p. 50 b.p.
Baa1 or better by ▇▇▇▇▇'▇
BBB or better by S&P and 0 b.p. 55 b.p.
Baa2 or better by ▇▇▇▇▇'▇,
but not BBB+ or better by
S&P and Baa1 or better by
▇▇▇▇▇'▇
BBB- or better by S&P and 0 b.p. 65 b.p.
Baa3 or better by ▇▇▇▇▇'▇,
but not BBB or better by
S&P and Baa2 or better by
▇▇▇▇▇'▇
(b) for each day on which the Borrower does not have
an Investment Grade Rating, the rate per annum set forth
below opposite the Pricing Ratio then in effect:
Applicable Margin
Pricing Ratio ABR Loans Eurodollar Loans
Greater than 3.75 to 1.00 100 b.p. 200 b.p.
Less than or equal to 3.75 75 b.p. 175 b.p.
to 1.00, but greater than
3.25 to 1.0
Less than or equal to 3.25 50 b.p. 150 b.p.
to 1.00, but greater than
2.75 to 1.0
Less than or equal to 2.75 25 b.p. 125 b.p.
to 1.00, but greater than
2.25 to 1.0
Less than or equal to 2.25 0 b.p. 100 b.p.
to 1.00, but greater than
1.75 to 1.0
Less than or equal to 1.75 0 b.p. 75 b.p.
to 1.00, but greater than
1.25 to 1.0
Less than or equal to 1.25 0 b.p. 50 b.p.
to 1.00
; provided, however, that, in the event that the financial
statements required to be delivered pursuant to subsection
8.1(a) or (b), as applicable, are not delivered when due,
then (notwithstanding the provisions of subsection 5.9)
during the period from the date upon which such financial
statements were required to be delivered until the date upon
which they actually are delivered, the Pricing Ratio shall
be deemed for purposes of this definition to be greater than
3.75 to 1.0.
"Application": an application, in such form as the
relevant Issuing Bank may specify from time to time,
requesting such Issuing Bank to open a Letter of Credit.
"Assignee": as defined in subsection 12.7(c).
"Available Cash Flow Amount": the amount equal to (a)
50% of the aggregate cumulative amount of Excess Cash Flow
arising since January 1, 1996 (but other than that arising
for periods for which no payment is due under subsection
5.5(c) because the Borrower was maintaining an Investment
Grade Rating on the relevant payment date) which the
Borrower has not been required to apply in accordance with
the provisions of subsection 5.5(c) minus (b) the sum of (i)
the aggregate amount of Restricted Payments made since the
date hereof in reliance upon the provisions of subsection
9.7(a) and (ii) the aggregate amount of capital expenditures
made since the date hereof in reliance upon the provisions
of subsection 9.8(a)(ii).
"Available Commitment": as to any Lender, at any time,
an amount equal to the excess, if any, of (a) such Lender's
Revolving Credit Commitment over (b) such Lender's Aggregate
Outstanding Extensions of Credit (other than, for purposes
only of the calculation of the commitment fee under
subsection 5.2, such Lender's ratable share of the then-
outstanding L/C Obligations on account of the Special
Letters of Credit).
"Borrower Domestic Stock Pledge Agreement": the
Borrower Stock Pledge Agreement to be executed and delivered
by the Borrower, substantially in the form of Exhibit D, as
the same may be amended, supplemented or otherwise modified
from time to time.
"Borrower International Stock Pledge Agreement": each
stock pledge agreement, in form and substance reasonably
satisfactory to the Administrative Agent, to be executed and
delivered by the Borrower with respect to the capital stock
of certain of its direct Foreign Subsidiaries, as the same
may be amended, supplemented or otherwise modified from time
to time.
"Borrower Patent Security Agreement": the Patent
Security Agreement to be executed and delivered by the
Borrower, in form and substance reasonably acceptable to the
Administrative Agent, as the same may be amended,
supplemented or otherwise modified from time to time.
"Borrower Security Agreement": the Security Agreement
to be executed and delivered by the Borrower, substantially
in the form of Exhibit C, as the same may be amended,
supplemented or otherwise modified from time to time.
"Borrower Security Documents": the collective
reference to the Borrower Patent Security Agreement, the
Borrower Security Agreement, the Borrower Domestic Stock
Pledge Agreement, the Borrower International Stock Pledge
Agreements and the Borrower Trademark Security Agreement.
"Borrower Trademark Security Agreement": the Trademark
Security Agreement to be executed and delivered by the
Borrower, in form and substance reasonably acceptable to the
Administrative Agent, as the same may be amended,
supplemented or otherwise modified from time to time.
"Business": as defined in subsection 6.18(b).
"Business Day": a day other than a Saturday, Sunday or
other day on which commercial banks in New York City are
authorized or required by law to close; provided that, with
respect to matters relating to Eurodollar Loans, the term
"Business Day" shall mean a day other than a Saturday,
Sunday or other day on which commercial banks in New York
City or London, England, are authorized or required by law
to close.
"Capital Stock": any and all shares, interests,
participations or other equivalents (however designated) of
capital stock of a corporation, any and all equivalent
ownership interests in a Person (other than a corporation)
and any and all warrants or options to purchase any of the
foregoing.
"Cash Equivalents": (a) securities with maturities of
one year or less from the date of acquisition issued or
fully guaranteed or insured by the United States Government
or any agency thereof, (b) certificates of deposit and
eurodollar time deposits with maturities of one year or less
from the date of acquisition and overnight bank deposits of
any Lender or of any commercial bank having capital and
surplus in excess of $500,000,000, (c) repurchase
obligations of any Lender or of any commercial bank or
investment bank satisfying the requirements of clause (b) of
this definition, having a term of not more than 30 days with
respect to securities issued or fully guaranteed or insured
by the United States Government or any agency thereof, (d)
commercial paper issued in the United States which is rated
at least A-2 by S&P or P-2 by ▇▇▇▇▇'▇, (e) 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, by any political subdivision
or taxing authority of any such state, commonwealth or
territory or by any foreign government, the securities of
which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be)
are rated at least A by S&P or A by ▇▇▇▇▇'▇, (f) securities
with maturities of one year or less from the date of
acquisition backed by standby letters of credit issued by
any Lender or any commercial bank satisfying the
requirements of clause (b) of this definition or (g) shares
of money market mutual or similar funds which invest
substantially exclusively in assets satisfying the
requirements of clauses (a) through (f) of this definition.
"Closing Date": the date on which the conditions
precedent set forth in subsection 7.1 shall be satisfied.
"Co-Agents": as defined in the preamble to this
Agreement.
"Code": the Internal Revenue Code of 1986, as amended
from time to time.
"Collateral": all assets of the Loan Parties, now
owned or hereinafter acquired, upon which a Lien is
purported to be created by any Security Document.
"Collateral Agency Agreement": the Collateral Agency
Agreement, to be executed and delivered by each Loan Party,
substantially in the form of Exhibit H, as the same may be
amended, supplemented or otherwise modified from time to
time.
"Commercial Letter of Credit": as defined in
subsection 4.1(b)(i)(2).
"Commitment": as to any Lender, its Revolving Credit
Commitment or Term Loan Commitment, as the context shall
require.
"Commitment Percentage": as to any Lender at any time,
its Term Loan Commitment Percentage or its Revolving Credit
Commitment Percentage, as the context shall require.
"Commitment Period": the period from and including the
date hereof to but not including the Termination Date or
such earlier date on which the Revolving Credit Commitments
shall terminate as provided herein.
"Commonly Controlled Entity": an entity, whether or
not incorporated, which is under common control with the
Borrower within the meaning of Section 4001 of ERISA or is
part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code.
"Consolidated Fixed Charges": for any period, the sum
(without duplication) of (a) the amount of interest expense,
both expensed and capitalized, of the Borrower and its
Subsidiaries, determined on a consolidated basis in
accordance with GAAP, for such period on the aggregate
principal amount of their consolidated Indebtedness,
(b) required cash amortization of Indebtedness for such
period and discount or premium relating to any such
Indebtedness for such period, whether expensed or
capitalized and (c) the aggregate amount of fixed and
contingent rentals payable by the Borrower and its
Subsidiaries, determined on a consolidated basis in
accordance with GAAP, for such period with respect to leases
of real and personal property.
"Consolidated Net Income" or "Consolidated Net Loss":
for any fiscal period, the amount which, in conformity with
GAAP, would be set forth opposite the caption "net income"
(or any like caption) or "net loss" (or any like caption),
as the case may be, on a consolidated statement of earnings
of the Borrower and its Subsidiaries for such fiscal period;
"Contractual Obligation": as to any Person, any
provision of any security issued by such Person or of any
agreement, instrument or other undertaking to which such
Person is a party or by which it or any of its property is
bound.
"Credit Rating": the rating publicly announced from
time to time by ▇▇▇▇▇'▇ or S&P (as the context shall
require) as being in effect with respect to the senior,
unsecured (and non-credit enhanced), long-term Indebtedness
of the Borrower.
"Credit Suisse": Credit Suisse, a Swiss banking
corporation.
"Debentures": the 6-3/4% Debentures, due 2005, of the
Borrower which are issued and outstanding under the
Indenture on the date hereof.
"Default": any of the events specified in Section 10,
whether or not any requirement for the giving of notice, the
lapse of time, or both, or any other condition, has been
satisfied.
"Dollars" and "$": dollars in lawful currency of the
United States of America.
"Domestic Subsidiary": any Subsidiary of the Borrower
organized under the laws of any jurisdiction within the
United States.
"EBITDA": for any fiscal period, the Consolidated Net
Income or Consolidated Net Loss, as the case may be, for
such fiscal period, after restoring thereto amounts deducted
for (a) extraordinary losses (or deducting therefrom any
amounts included therein on account of extraordinary gains)
and special charges (including, without limitation, special
charges on account of Olympic spending during the 1996
fiscal year of the Borrower in an amount not to exceed
$12,500,000 for each fiscal quarter during such fiscal
year), (b) depreciation and amortization (including write-
offs or write-downs of amortizable and depreciable items),
(c) the amount of interest expense of the Borrower and its
Subsidiaries, determined on a consolidated basis in
accordance with GAAP, for such period on the aggregate
principal amount of their consolidated Indebtedness, (d) the
amount of tax expense of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP,
for such period, (e) the aggregate amount of fixed and
contingent rentals payable by the Borrower and its
Subsidiaries, determined on a consolidated basis in
accordance with GAAP, for such period with respect to leases
of real and personal property and (f) minority interests.
"Environmental Laws": any and all foreign, Federal,
state, local or municipal laws, rules, orders, regulations,
statutes, ordinances, codes, decrees or other Requirements
of Law (including common law) regulating, relating to or
imposing liability or standards of conduct concerning
protection of human health or the environment, as now or may
at any time hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"Eurocurrency Reserve Requirements": for any day as
applied to a Eurodollar Loan, the aggregate (without
duplication) of the rates (expressed as a decimal fraction)
of reserve requirements in effect on such day (including,
without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board of
Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect
thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of such Board) maintained by a
member bank of such System.
"Eurodollar Base Rate": the rate per annum determined
by the Administrative Agent at approximately 11:00 a.m.
(London time) on the date which is two Business Days prior
to the beginning of the relevant Interest Period (as
specified in the applicable Notice of Borrowing) by
reference to the British Bankers' Association Interest
Settlement Rates for deposits in Dollars (as set forth by
any service selected by the Administrative Agent which has
been nominated by the British Bankers' Association as an
authorized information vendor for the purpose of displaying
such rates) for a period equal to such Interest Period
(rounded, if necessary, upward to the nearest whole multiple
of 1/16th of 1%); provided that, to the extent that an
interest rate is not ascertainable pursuant to the foregoing
provisions of this definition, the "Eurodollar Base Rate"
shall be the interest rate per annum determined by the
Administrative Agent to be the average (rounded, if
necessary, upward to the nearest whole multiple of 1/16th of
1% per annum, if such average is not such a multiple) of the
rates per annum at which deposits in Dollars are offered for
such relevant Interest Period to major banks in the London
interbank market in London, England by the Reference Banks
at approximately 11:00 a.m. (London time) on the date which
is two Business Days prior to the beginning of such Interest
Period. If any of the Reference Banks shall be unable or
shall otherwise fail to supply such rates to the
Administrative Agent upon its request, the rate of interest
shall, subject to the provisions of subsection 5.10, be
determined on the basis of the quotations of the remaining
Reference Banks or Reference Bank.
"Eurodollar Loans": Loans the rate of interest
applicable to which is based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during
each Interest Period pertaining to a Eurodollar Loan, a rate
per annum determined for such day in accordance with the
following formula (rounded, if necessary, upward to the
nearest whole multiple of 1/16th of 1%):
Eurodollar Base Rate
________________________________________
1.00 - Eurocurrency Reserve Requirements
"Event of Default": any of the events specified in
Section 10, provided that any requirement for the giving of
notice, the lapse of time, or both, or any other condition,
has been satisfied.
"Excess Cash Flow": for any fiscal year of the
Borrower, the amount equal to:
(a) the sum of (i) EBITDA of the Borrower and its
Subsidiaries for such fiscal year and (ii) the aggregate
amount actually repatriated to the United States from
Foreign Subsidiaries during such period pursuant to the
proviso to clause (b)(vi) of this definition and clause (vi)
of the definition of the term "Net Proceeds" (in an
aggregate amount which, in the aggregate with other amounts
previously included in the calculation of Excess Cash Flow
pursuant to this clause (ii), does not exceed the amounts
excluded pursuant to clause (b)(vi) below); minus
(b) the sum (without duplication) of (i) interest paid
in cash during such period, (ii) the aggregate principal
amount of Indebtedness for borrowed money, deferred purchase
price of property and Financing Leases (including, without
limitation, any current maturities of long-term
Indebtedness) which is repaid during such period pursuant to
scheduled reductions and amortizations thereof, (iii) the
aggregate amount of capital expenditures made in cash during
such period (other than any such capital expenditures made
since the date hereof in reliance upon the provisions of
subsection 9.8(a)(ii) of this Agreement), (iv) the aggregate
amount of cash taxes paid during such period, (v) minority
interests, (vi) earnings (defined in a manner similar to the
definition of the term "EBITDA" contained herein) of Foreign
Subsidiaries that can not be repatriated to the United
States without the incurrence (or material acceleration) of
significant tax liability (provided that such amounts shall
be deemed to be included in EBITDA for purposes only of
calculating Excess Cash Flow during the fiscal quarter in
which such amounts are actually repatriated to the United
States) and (vii) for purposes of calculating "Excess Cash
Flow" for the 1996 fiscal year of the Borrower only, the
amount equal to the sum of (A) the aggregate amount of cash
expenditures for open market purchases of common stock of
the Borrower made during the period between January 1, 1996
and July 31, 1996, (B) the aggregate amount of special
charges (not to exceed $50,000,000) on account of Olympic
spending during the 1996 fiscal year of the Borrower and (C)
the aggregate amount of cash dividends paid by the Borrower
on account of its common stock during the period from
January 1, 1996 through the date hereof.
"Federal Funds Effective Rate": for any day, the
weighted average 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
which is a Business Day, the average of the quotations for
the day of such transactions received by the Administrative
Agent from three federal funds brokers of recognized
standing selected by it.
"Financing Lease": any lease of property, real or
personal, the obligations of the lessee in respect of which
are required in accordance with GAAP to be capitalized on a
balance sheet of the lessee.
"Fireman Group" ▇▇▇▇ ▇▇▇▇▇▇▇, his spouse, his parents,
his children, his grandchildren, the ▇▇▇▇ and ▇▇▇▇▇▇▇
Fireman Trust, the PFP Charitable Trust, any other trusts of
which ▇▇▇▇ ▇▇▇▇▇▇▇ is a trustee and any other charitable
trusts created by him.
"Foreign Subsidiary": any Subsidiary of the Borrower
organized under the laws of any jurisdiction outside the
United States of America.
"GAAP": generally accepted accounting principles in
the United States of America as in effect from time to time;
provided that, for purposes of determining compliance with
the provisions of subsection 9.1, "GAAP" shall mean
generally accepted account principles in the United States
of America as in effect on June 30, 1996.
"Governmental Authority": any nation or government,
any state or other political subdivision thereof and any
entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.
"▇▇▇▇ ▇▇▇▇▇▇ Subsidiary": a Subsidiary to be formed by
the Borrower to hold the material assets of its ▇▇▇▇ ▇▇▇▇▇▇
sportswear division (and no other material assets) in
connection with the consummation of the ▇▇▇▇ ▇▇▇▇▇▇
Transaction.
"▇▇▇▇ ▇▇▇▇▇▇ Transaction": the swap or other transfer
or exchange by ▇▇▇▇ ▇▇▇▇▇▇ (or entities controlled by him)
of all or any portion of the royalties (including, without
limitation, future royalties) and other compensation owing
to him from the business of the ▇▇▇▇ ▇▇▇▇▇▇ sportswear
division of the Borrower for equity in the Borrower or the
▇▇▇▇ ▇▇▇▇▇▇ Subsidiary.
"Guarantees": the collective reference to the
Subsidiaries Guarantee and each other guarantee from time to
time made in favor of the Collateral Agent under (and as
defined in) the Collateral Agency Agreement or the
Administrative Agent to secure all or any part of the
obligations of the Borrower hereunder.
"Guarantee Obligation": as to any Person (the
"guaranteeing person"), any obligation of (a) the
guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to
induce the creation of which the guaranteeing person has
issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect
guaranteeing any Indebtedness, leases, dividends or other
obligations (the "primary obligations") of any other third
Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any
obligation of the guaranteeing person incurred for the
purpose of providing credit support, whether or not
contingent, (i) to purchase any such primary obligation or
any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the
purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency
of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the
owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee
Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business.
The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount
equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee Obligation is
made and (b) the maximum amount for which such guaranteeing
person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary
obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee
Obligation shall be such guaranteeing person's maximum
reasonably anticipated liability in respect thereof as
determined by the Borrower in good faith.
"Guarantor": any Person delivering a Guarantee.
"Indebtedness": of any Person at any date, (a) all
indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of
business and payable in accordance with customary
practices), (b) any other indebtedness of such Person which
is evidenced by a note, bond, debenture or similar
instrument, (c) all obligations of such Person under
Financing Leases, (d) all obligations of such Person in
respect of acceptances issued or created for the account of
such Person, (e) all liabilities secured by any Lien on any
property owned by such Person even though such Person has
not assumed or otherwise become liable for the payment
thereof and (f) all Indebtedness of the types referred to in
clauses (a) through (e) above which is guaranteed directly
or indirectly by such Person.
"Indenture": the First Supplemental Indenture, dated
as of January 22, 1993, amending and restating the
Indenture, dated as of September 15, 1988, between the
Borrower and Citibank, N.A., as trustee, as the same may be
amended, supplemented or otherwise modified from time to
time in accordance with the terms hereof.
"Insolvency": with respect to any Multiemployer Plan,
the condition that such Plan is insolvent within the meaning
of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Interest Payment Date": (a) as to any ABR Loan, the
last Business Day of each March, June, September and
December, (b) as to any Eurodollar Loan having an Interest
Period of three months or less, the last day of such
Interest Period, and (c) as to any Eurodollar Loan having an
Interest Period longer than three months, the day which is
three months (or a whole multiple thereof) after the first
day of such Interest Period and the last day of such
Interest Period.
"Interest Period": (b) with respect to any Eurodollar
Loan:
(i) initially, the period commencing on the
borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two,
three or six months thereafter, as selected by the
Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect
thereto; and
(ii) thereafter, each period commencing on the
last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two,
three or six months thereafter, as selected by the
Borrower in a Notice of Borrowing delivered to the
Administrative Agent by 10:00 A.M., New York City time,
not less than three Business Days prior to the last day
of the then current Interest Period with respect
thereto;
provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(1) if any Interest Period pertaining to a
Eurodollar Loan would otherwise end on a day that is
not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless the
result of such extension would be to carry such
Interest Period into another calendar month in which
event such Interest Period shall end on the immediately
preceding Business Day;
(2) any Interest Period that would otherwise
extend beyond the Termination Date or beyond the date
final payment is due on the Term Loans shall end on the
Termination Date or such date of final payment, as the
case may be;
(3) any Interest Period pertaining to a Eurodollar
Loan that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business
Day of a calendar month; and
(4) the Borrower shall select Interest Periods so
as not to require a payment or prepayment of any
Eurodollar Loan during an Interest Period for such
Loan.
"Investment Grade Rating": a Credit Rating of (a) BBB-
or better from S&P and Baa3 or better from ▇▇▇▇▇'▇ or (b)
BBB or better from S&P or Baa2 or better from Moody's;
provided that the Borrower shall be deemed not to have
obtained (or be maintaining) an Investment Grade Rating
until each of S&P and ▇▇▇▇▇'▇ has either confirmed its
existing Credit Rating or published a revised Credit Rating
for the Borrower following the consummation of the
Repurchase and such confirmed or new credit ratings satisfy
the requirements set forth above.
"Issuing Bank": with respect to any Letter of Credit,
(a) Credit Suisse (or any affiliate thereof) or (b) any
Lender (or any affiliate thereof), acting in its capacity as
such an issuer, from time to time designated by the Borrower
as the issuer of such Letter of Credit which is reasonably
acceptable to the Administrative Agent and agrees (in its
sole discretion) to serve in such capacity with respect to
such Letter of Credit.
"L/C Commitment": $450,000,000.
"L/C Fee Payment Date": the last Business Day of each
March, June, September and December.
"L/C Obligations": at any time, an amount equal to the
sum of (a) the aggregate then undrawn and unexpired amount
of the then outstanding Letters of Credit and (b) the
aggregate amount of drawings under Letters of Credit which
have not then been reimbursed pursuant to subsection 4.5(a).
"L/C Participants": with respect to each Letter of
Credit, the collective reference to all Lenders holding
Revolving Credit Commitments, other than the Issuing Bank
with respect to such Letter of Credit.
"Letter of Credit": a Commercial Letter of Credit
(including, without limitation, a Special Letter of Credit)
or a Standby Letter of Credit, as the context shall require;
collectively, the "Letters of Credit".
"Lien": any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien
(statutory or other), charge or other security interest or
any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever
(including, without limitation, any conditional sale or
other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the
foregoing).
"Loan": a Term Loan or a Revolving Credit Loan, as the
context shall require; collectively, the "Loans".
"Loan Documents": this Agreement, the Notes and the
Applications, the Guarantees and the Security Documents.
"Loan Parties": the Borrower and each Subsidiary of
the Borrower which is a party to a Loan Document.
"Majority Lenders": at any time (a) prior to the
Closing Date, Lenders then having Commitments which
aggregate more than 50% of the amount of the Term Loan
Commitments and Revolving Credit Commitments then
outstanding and (b) after the Closing Date, Lenders then
having Term Loans and Revolving Credit Commitments (or, if
the Revolving Credit Commitments have terminated, Aggregate
Outstanding Extensions of Credit) which aggregate more than
50% of the sum of the Term Loans then outstanding and the
Revolving Credit Commitments (or Aggregate Outstanding
Extensions of Credit, as the case may be) then in effect.
"Material Adverse Effect": a material adverse effect
on (a) the consummation of the Repurchase, (b) the business,
operations, property, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a
whole, (c) the validity or enforceability of this or any of
the other Loan Documents or (d) the rights or remedies of
the Administrative Agent or the Lenders hereunder or under
any of the other Loan Documents.
"Material Environmental Amount": an amount payable by
the Borrower and/or its Subsidiaries in excess of
$10,000,000 for remedial costs, non-routine compliance
costs, compensatory damages, punitive damages, fines,
penalties or any combination thereof.
"Material Subsidiary": each Domestic Subsidiary of the
Borrower which has either (a) assets having a fair market
value (as reasonably estimated by the Borrower) or book
value in excess of $10,000,000 in the aggregate or (b)
revenues in excess of $10,000,000 per annum, other than (x)
Reebok Securities Holdings Corp., during such time as its
only material asset is capital stock of RBK Holdings plc,
(y) Avintco, Inc., during the period prior to the first
anniversary of the Closing Date and (z) Reebok Foundation,
Inc.
"Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or
petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or
under any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.
"Moody's": ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan": a Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
"Net Proceeds": with respect to any Net Proceeds
Event, (a) the gross cash consideration, and all cash
proceeds (as and when received) of non-cash consideration
(including, without limitation, any such cash proceeds in
the nature of principal and interest payments on account of
promissory notes or similar obligations), received by the
Borrower and its Subsidiaries in connection with such Net
Proceeds Event, minus (b) the sum, without duplication, of
(i) any taxes which are paid or actually payable to any
federal, state, local or foreign taxing authority by the
Borrower and its Subsidiaries and are directly attributable
to the receipt of such Net Proceeds, (ii) the amount of fees
and commissions (including reasonable investment banking
fees), legal, accounting, consulting, survey, title and
recording tax expenses and other costs and expenses directly
incident to such Net Proceeds Event which are paid or
payable by the Borrower and its Subsidiaries, (iii) the
amount of such net cash proceeds which are attributable to
(and payable to) minority interests, (iv) the amount of any
reserve reasonably maintained by the Borrower and its
Subsidiaries with respect to indemnification obligations
owing pursuant to the definitive documentation pursuant to
which the Net Proceeds Event is consummated (with any unused
portion of such reserve to constitute Net Proceeds on the
date upon which the indemnification obligations terminates),
(v) the amount of Indebtedness (other than intercompany
Indebtedness), if any, which is required to be repaid at the
time or as a result of such Net Proceeds Event out of the
proceeds thereof and (vi) any amounts received by Foreign
Subsidiaries on account of such Net Proceeds Event that can
not be repatriated to the United States without the
incurrence (or material acceleration) of significant tax
liability (provided that any portion of such amounts which
subsequently are repatriated to the United States shall be
deemed to constitute Net Proceeds received on the date of
such repatriation).
"Net Proceeds Event": (a) the incurrence by the
Borrower or any of its Subsidiaries of any Indebtedness
(other than Indebtedness permitted pursuant to clauses (a)
through (j) of subsection 9.2);
(b) the issuance or sale of any equity securities by
the Borrower or any of its Subsidiaries to any Person, other
than (i) the issuance or sale of any such equity securities
to the Borrower or any of its Subsidiaries, (ii) the
issuance of Capital Stock upon the sale or exercise of stock
options, (iii) the issuance and sale of Capital Stock under
employee stock purchase plans, (iv) the issuance and sale of
Capital Stock and/or stock options under employee stock
ownership and incentive plans and similar programs or
individual arrangements;
(c) the sale, transfer or other disposition by the
Borrower or any of its Subsidiaries of any real or personal,
tangible or intangible, property (including, without
limitation, any capital stock, but other than inventory
sold, transferred or otherwise disposed of in the ordinary
course of business) of the Borrower or such Subsidiary to
any Person (other than to the Borrower or any of its
Subsidiaries); and
(d) the recovery by the Borrower of amounts owing to
it under property insurance policies.
"Non-Excluded Taxes": as defined in subsection
5.14(a).
"Notes": the collective reference to the Revolving
Credit Notes and the Term Notes.
"Notice of Borrowing" means (a) with respect to a
request for a borrowing hereunder, a request in the form of
Exhibit K-1 hereto, (b) with respect to a request for
continuation of a Eurodollar Loan hereunder, a request in
the form of Exhibit K-2 hereto and (c) with respect to a
request for conversion of or to a Eurodollar Loan hereunder,
a request in the form of Exhibit K-3 hereto, in each case
delivered by a Responsible Officer of the Borrower to the
Administrative Agent hereunder.
"Offer to Purchase": the Offer to Purchase of the
Borrower, dated July 30, 1996 and distributed to holders of
the Capital Stock of the Borrower on such date.
"Participant": as defined in subsection 12.7(b).
"Patent Security Agreements": the collective reference
to the Borrower Patent Security Agreement and each
Subsidiaries Patent Security Agreement.
"PBGC": the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.
"Person": an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other
entity of whatever nature.
"Plan": at a particular time, any employee benefit
plan which is covered by ERISA and in respect of which the
Borrower or a Commonly Controlled Entity is (or, if such
plan were terminated at such time, would under Section 4069
of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Pricing Ratio": at any date:
(a) with respect to the calculation of the
Applicable Margin and the Applicable Commitment Fee
Rate, the ratio of (i) total Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis
as at the last day of the fiscal quarter most recently
ended for which the Borrower has delivered the
financial statements contemplated by subsection 8.1(a)
or (b), as the case may be, to (ii) EBITDA of the
Borrower and its Subsidiaries on a consolidated basis
for the period of four consecutive fiscal quarters
ended on such last day; provided that, during the
period from the date hereof through and including the
date upon which the financial statements required
pursuant to subsection 8.1(b) are received by the
Administrative Agent with respect to the fiscal quarter
ending September 30, 1996, the Pricing Ratio in effect
on each date shall be (v) 3.50 to 1.0, to the extent
that the amount of Term Loans then outstanding is
greater than or equal to $800,000,000, (w) 3.00 to
1.00, to the extent that the amount of Term Loans then
outstanding is greater than or equal to $615,000,000
but less than $800,000,000, (x) 2.50 to 1.00, to the
extent that the amount of Term Loans then outstanding
is greater than or equal to $430,000,000, but less than
$615,000,000, (y) 2.00 to 1.00, to the extent that the
amount of the Term Loans then outstanding is greater
than or equal to $245,000,000, but less than
$430,000,000 and (z) 1.50 to 1.00, to the extent that
the amount of Term Loans then outstanding is less than
$245,000,000; and
(b) with respect to the calculation of compliance
with the provisions of subsection 9.1(a)(i), the ratio
of (i) total Indebtedness of the Borrower and its
Subsidiaries on a consolidated basis as at such date to
(ii) EBITDA of the Borrower and its Subsidiaries on a
consolidated basis for the period of four consecutive
fiscal quarters most recently ended for which the
Borrower has delivered the financial statements
contemplated by subsection 8.1(a) or (b), as the case
may be.
"Prime Rate": the rate of interest per annum publicly
announced from time to time by the Administrative Agent as
its prime rate in effect at its principal office in New York
City.
"Properties": as defined in subsection 6.18(a).
"Reference Banks": ABN AMRO Bank N.V., Citibank, N.A.,
Credit Suisse, The First National Bank of Boston and The
First National Bank of Chicago. If any Reference Bank shall
for any reason no longer have a Commitment or any Loans,
such Reference Bank shall thereupon cease to be a Reference
Bank and the Administrative Agent (after consultation with
the Borrower) shall, by notice to the Borrower and the
Lenders, designate another Lender as a Reference Bank. Each
Reference Bank shall use its best efforts to furnish
quotations of rates to the Administrative Agent as
contemplated hereby.
"Register": as defined in subsection 12.7(d).
"Regulation U": Regulation U of the Board of Governors
of the Federal Reserve System as in effect from time to
time.
"Reimbursement Obligation": with respect to any Letter
of Credit, the obligation of the Borrower to reimburse the
Issuing Bank with respect thereto pursuant to subsection
4.5(a) for amounts drawn thereunder.
"Reorganization": with respect to any Multiemployer
Plan, the condition that such plan is in reorganization
within the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in
Section 4043(c) of ERISA, other than those events as to
which the thirty day notice period is waived under
subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg.
Section 2615.
"Repurchase": as defined in the recitals to this
Agreement.
"Required Lenders": at any time (a) prior to the
Closing Date, Lenders then having Commitments which
aggregate more than 66-2/3% of the amount of the Term Loan
Commitments and Revolving Credit Commitments then
outstanding and (b) after the Closing Date, Lenders then
having Term Loans and Revolving Credit Commitments (or, if
the Revolving Credit Commitments have terminated, Aggregate
Outstanding Extensions of Credit) which aggregate more than
66-2/3% of the sum of the Term Loans then outstanding and
the Revolving Credit Commitments (or Aggregate Outstanding
Extensions of Credit, as the case may be) then in effect.
"Requirement of Law": as to any Person, the
Certificate of Incorporation and By-Laws or other
organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any
of its property or to which such Person or any of its
property is subject.
"Responsible Officer": the chief executive officer,
the president, any executive vice president, the chief
financial officer, the treasurer and the Manager of treasury
operations of the Borrower.
"Restricted Payment": as defined in subsection 9.7.
"Revolving Credit Commitment": as to any Lender, the
obligation of such Lender to make Revolving Credit Loans to
and/or issue or participate in Letters of Credit issued on
behalf of the Borrower hereunder in an aggregate principal
and/or face amount at any one time outstanding not to exceed
the amount set forth opposite such Lender's name on
Schedule II; as to all Lender's collectively, the "Revolving
Credit Commitments".
"Revolving Credit Commitment Percentage": as to any
Lender at any date, the percentage which such Lender's
Revolving Credit Commitment then constitutes of the
aggregate Revolving Credit Commitments (or, at any time
after the Revolving Credit Commitments shall have expired or
terminated, the percentage which the Aggregate Outstanding
Extensions of Credit of such Lender then constitutes of the
Aggregate Outstanding Extensions of Credit of all Lenders).
"Revolving Credit Loans": as defined in subsection
3.1.
"Revolving Credit Note": as defined in subsection
5.1(e).
"S&P": Standard and Poor's Rating Group.
"Security Agreements": the collective reference to the
Borrower Security Agreement and each Subsidiaries Security
Agreement.
"Security Documents": the collective reference to the
Patent Security Agreements, the Security Agreements, the
Stock Pledge Agreements, the Trademark Security Agreements,
the Collateral Agency Agreement and all other security
documents hereafter delivered to the Administrative Agent
granting a Lien on any asset or assets of any Person to
secure the obligations and liabilities of the Borrower
hereunder and under any of the other Loan Documents or to
secure any guarantee of any such obligations and
liabilities.
"Single Employer Plan": any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Special Letters of Credit": one or more Commercial
Letters of Credit which are denominated either (a) in
currencies other than Dollars which are reasonably
acceptable to the relevant Issuing Bank or (b) issued (in
any currency) from a jurisdiction (other than the United
States) which is reasonably acceptable to the relevant
Issuing Bank; each, a "Special Letter of Credit". For
purposes of this Agreement, the aggregate amount of the L/C
Obligations outstanding at any date on account of any
Special Letter of Credit which is denominated in a currency
other than Dollars shall be the amount of Dollars into which
the then outstanding face amount of such Special Letter of
Credit would be converted at the spot rate of exchange
reasonably determined by the Administrative Agent to be
available to it on the most recent to occur of (x) the date
of issuance (or, in the case of any Special Letter of Credit
which is increased, the date of such increase) of such
Special Letter of Credit and (y) the last Business Day of
the most recently ended calendar quarter (in each such case,
without giving effect to any fluctuation in exchange rates
since the date of such issuance, increase or quarter-end, as
the case may be).
"Standby Letter of Credit": as defined in paragraph
4.1(b)(i)(1).
"Stock Pledge Agreements": the collective reference to
the Borrower Domestic Stock Pledge Agreement, the Borrower
International Stock Pledge Agreements, the Subsidiaries
Domestic Stock Pledge Agreements and the Subsidiaries
International Stock Pledge Agreements.
"Subsidiaries Domestic Stock Pledge Agreement": each
Subsidiaries Stock Pledge Agreement to be executed and
delivered by a Domestic Subsidiary of the Borrower,
substantially in the form of Exhibit G, as the same may be
amended, supplemented or otherwise modified from time to
time.
"Subsidiaries International Stock Pledge Agreement":
each stock pledge agreement, in form and substance
reasonably satisfactory to the Administrative Agent, to be
executed and delivered by a Domestic Subsidiary of the
Borrower with respect to the capital stock of certain of its
direct Foreign Subsidiaries, as the same may be amended,
supplemented or otherwise modified from time to time.
"Subsidiaries Guarantee": each Guarantee to be
executed and delivered by one or more Domestic Subsidiaries,
substantially in the form of Exhibit E, as the same may be
amended, supplemented or otherwise modified from time to
time.
"Subsidiaries Patent Security Agreement": each Patent
Security Agreement to be executed and delivered by a
Domestic Subsidiary which from time to time holds patents,
in form and substance reasonably acceptable to the
Administrative Agent, as the same may be amended,
supplemented or otherwise modified from time to time.
"Subsidiaries Security Agreement": each Security
Agreement to be executed and delivered by a Subsidiary in
favor of the Administrative Agent, substantially in the form
of Exhibit F, as the same may be amended, supplemented or
otherwise modified from time to time.
"Subsidiaries Security Documents": the collective
reference to each Subsidiaries Patent Security Agreement,
each Subsidiaries Security Agreement, each Subsidiaries
Domestic Stock Pledge Agreement, each Subsidiaries
International Stock Pledge Agreement and each Subsidiaries
Trademark Security Agreement.
"Subsidiaries Trademark Security Agreement": each
Trademark Security Agreement to be executed and delivered by
a Domestic Subsidiary which from time to time holds
trademarks, in form and substance reasonably acceptable to
the Administrative Agent, as the same may be amended,
supplemented or otherwise modified from time to time.
"Subsidiary": as to any Person, a corporation,
partnership or other entity of which shares of stock or
other ownership interests having ordinary voting power
(other than stock or such other ownership interests having
such power only by reason of the happening of a contingency)
to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity
are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or
more intermediaries, or both, by such Person; provided that
(during such time as common stock of the Borrower
constitutes its only material asset) RBK Holdings plc shall
be deemed not to constitute a Subsidiary of the Borrower for
any purpose hereunder, other than for purposes of (a)
subsection 5.5, (b) calculation of financial covenants, (c)
determination of the Pricing Ratio and (d) presentation of
financial statements. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of the
Borrower.
"Tender Offer Documents": the collective reference to
(a) the Offer to Purchase, (b) the Schedule 13E-4 filed with
the Securities and Exchange Commission on July 30, 1996, as
amended, and the Exhibits thereto.
"Termination Date": August 31, 2002.
"Term Loan": as defined in subsection 2.1.
"Term Loan Commitment": as to any Lender, the
obligation of such Lender to make Term Loans to the Borrower
hereunder in an aggregate principal at any one time
outstanding not to exceed the amount set forth opposite such
Lender's name on Schedule II; as to all Lenders
collectively, the "Term Loan Commitments".
"Term Loan Commitment Percentage": as to any Lender at
any date, the percentage which such Lender's Term Loan
Commitment then constitutes of the aggregate Term Loan
Commitments (or, at any time after the Term Loan Commitments
shall have expired or terminated, the percentage which the
aggregate principal amount of such Lender's Term Loans then
outstanding constitutes of the aggregate principal amount of
the Term Loans then outstanding).
"Term Note": as defined in subsection 5.1(e).
"Trademark Security Agreements": the collective
reference to the Borrower Trademark Security Agreement and
each Subsidiaries Trademark Security Agreement.
"Tranche": the collective reference to Eurodollar
Loans having then current Interest Periods which began on
the same date and end on the same later date (whether or not
such Loans shall originally have been made on the same day).
"Transferee": as defined in subsection 12.7(f).
"Type": as to any Loan, its nature as an ABR Loan or a
Eurodollar Loan.
"Uniform Customs": the Uniform Customs and Practice
for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, as the same may be
amended from time to time.
1.2 Other Definitional Provisions. (a) Unless
otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in any Notes or any
certificate or other document made or delivered pursuant hereto.
(b) As used herein and in any Notes, and any
certificate or other document made or delivered pursuant hereto,
accounting terms relating to the Borrower and its Subsidiaries
not defined in subsection 1.1 and accounting terms partly defined
in subsection 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision
of this Agreement, and Section, subsection, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(d) Except to the extent otherwise set forth herein
(including, without limitation, the definition of the term
"Special Letters of Credit" contained in this subsection 1.1),
any amounts which are denominated in currencies other than
Dollars shall be deemed to be equal to the amount of Dollars
which would be obtained on the date of determination through a
conversion of such currency into Dollars at the spot rate of
exchange reasonably determined by the Administrative Agent to be
available to it on the date of computation.
(e) In the computation of periods of time from a
specified date to a later specified date, the word "from" means
"from and including" and the words "to" and "until" each mean "to
but excluding". Periods of days referred to in this Agreement
shall be counted in calendar days unless Business Days are
expressly prescribed. Any period determined hereunder by
reference to a month or months or year or years shall end on the
day in the relevant calendar month in the relevant year, if
applicable, immediately preceding the date numerically
corresponding to the first day of such period, provided, that if
such period commences on the last day of a calendar month (or on
a day for which there is no numerically corresponding day in the
calendar month during which such period is to end), such period
shall, unless otherwise expressly required by the other
provisions of this Agreement, end on the last day of the calendar
month.
(f) The meanings given to terms defined herein shall
be equally applicable to both the singular and plural forms of
such terms.
SECTION 2. AMOUNT AND TERMS OF TERM LOAN COMMITMENTS
2.1 Term Loans. Subject to the terms and conditions
hereof, each Lender severally agrees to make a term loan (a "Term
Loan") to the Borrower on any one Business Day to occur within
ten Business Days following the date hereof in an amount not to
exceed the amount of the Term Loan Commitment of such Lender then
in effect. The Term Loans may from time to time be (a)
Eurodollar Loans, (b) ABR Loans or (c) a combination thereof, as
determined by the Borrower and notified to the Administrative
Agent in accordance with subsections 2.2 and 5.6.
2.2 Procedure for Term Loan Borrowing. The Borrower
shall give the Administrative Agent its irrevocable Notice of
Borrowing (which notice must be received by the Administrative
Agent prior to 10:00 A.M., New York City time, (x) three Business
Days prior to the requested borrowing date, if all or any part of
the requested Term Loans are to be initially Eurodollar Loans or
(y) one Business Day prior to the requested borrowing date,
otherwise) requesting that the Lenders make the Term Loans on the
requested borrowing date and specifying the amount to be
borrowed. Upon receipt of such Notice of Borrowing, the
Administrative Agent shall promptly notify each Lender thereof.
Each Lender will make the amount of its pro rata share of the
Term Loans available to the Administrative Agent for the account
of the Borrower at the office of the Administrative Agent
specified in subsection 12.3 prior to 11:00 A.M., New York City
time, on the requested borrowing date in funds immediately
available to the Administrative Agent. Such Term Loans will then
be made available to the Borrower by the Administrative Agent
transferring to the account directed by the Borrower (which
account need not be maintained by the Administrative Agent) with
the aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the
Administrative Agent.
2.3 Amortization of Term Loans. (a) The Borrower
shall repay the Term Loans on each date set forth below (or, if
such date is not a Business Day, on the immediately preceding
Business Day) by the amount set forth below opposite such date:
Period Amount
March 31, 1997 $10,000,000
June 30, 1997 20,000,000
September 30, 1997 20,000,000
December 31, 1997 25,000,000
March 31, 1998 15,000,000
June 30, 1998 30,000,000
September 30, 1998 35,000,000
December 31, 1998 45,000,000
March 31, 1999 15,000,000
June 30, 1999 35,000,000
September 30, 1999 45,000,000
December 31, 1999 55,000,000
March 31, 2000 15,000,000
June 30, 2000 35,000,000
September 30, 2000 45,000,000
December 31, 2000 55,000,000
March 31, 2001 20,000,000
June 30, 2001 40,000,000
September 30, 2001 70,000,000
December 31, 2001 80,000,000
March 31, 2002 20,000,000
June 30, 2002 55,000,000
August 31, 2002 155,000,000
(b) The Borrower shall repay any then-outstanding Term
Loans on the Termination Date.
2.4 Use of Proceeds of Term Loans. The proceeds of
the Term Loans shall be utilized by the Borrower only (a) to
repurchase shares of common stock of the Borrower which are
tendered to it pursuant to the Repurchase (which shares shall
then be retired) and (b) to pay any fees and expenses relating
thereto.
SECTION 3. AMOUNT AND TERMS OF REVOLVING CREDIT
COMMITMENTS
3.1 Revolving Credit Commitments. (a) Subject to the
terms and conditions hereof, each Lender severally agrees to make
revolving credit loans ("Revolving Credit Loans") to the Borrower
from time to time during the Commitment Period in an aggregate
principal amount at any one time outstanding which, when added to
such Lender's Revolving Credit Commitment Percentage of the then
outstanding L/C Obligations, does not exceed the amount of such
Lender's Revolving Credit Commitment. During the Commitment
Period the Borrower may use the Revolving Credit Commitments by
borrowing, prepaying the Revolving Credit Loans in whole or in
part, and reborrowing, all in accordance with the terms and
conditions hereof.
(b) The Revolving Credit Loans may from time to time
be (i) Eurodollar Loans, (ii) ABR Loans or (iii) a combination
thereof, as determined by the Borrower and notified to the
Administrative Agent in accordance with subsections 3.2 and 5.6,
provided that no Revolving Credit Loan shall be made as a
Eurodollar Loan after the day that is one month prior to the
Termination Date.
3.2 Procedure for Revolving Credit Borrowing. The
Borrower may borrow under the Revolving Credit Commitments during
the Commitment Period on any Business Day, provided that the
Borrower shall deliver to the Administrative Agent the Borrower's
irrevocable Notice of Borrowing prior to 10:00 A.M., New York
City time, (a) three Business Days prior to the requested
borrowing date, if all or any part of the requested Revolving
Credit Loans are to be initially Eurodollar Loans or (b) one
Business Day prior to the requested borrowing date, otherwise.
Each borrowing under the Revolving Credit Commitments shall be in
an amount equal to (x) in the case of ABR Loans, $10,000,000 or a
whole multiple of $1,000,000 in excess thereof (or, if the then
Available Commitments are less than $10,000,000, such lesser
amount) and (y) in the case of Eurodollar Loans, $10,000,000 or a
whole multiple of $1,000,000 in excess thereof. Upon receipt of
any such Notice of Borrowing from the Borrower, the
Administrative Agent shall promptly notify each Lender thereof.
Each Lender will make the amount of its pro rata share of each
borrowing available to the Administrative Agent for the account
of the Borrower at the office of the Administrative Agent
specified in subsection 12.3 prior to 11:00 A.M., New York City
time, on the borrowing date requested by the Borrower in funds
immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent transferring to the account directed by the
Borrower (which account need not be maintained by the
Administrative Agent) with the aggregate of the amounts made
available to the Administrative Agent by the Lenders and in like
funds as received by the Administrative Agent.
3.3 Use of Proceeds of Revolving Credit Loans. The
proceeds of the Revolving Credit Loans shall be utilized by the
Borrower only (a) to refinance outstanding Indebtedness of the
Borrower and its Subsidiaries and (b) for other general corporate
purposes.
SECTION 4. AMOUNT AND TERMS OF LETTER OF CREDIT SUB-
FACILITY
4.1 L/C Commitment. (a) Subject to the terms and
conditions hereof, each Issuing Bank, in reliance on the
agreements of the other Lenders set forth in subsection 4.4(a),
agrees to issue any Letters of Credit requested to be issued by
it and so issued by it for the account of the Borrower on any
Business Day during the Commitment Period in such form as may be
approved from time to time by such Issuing Bank; provided that
such Issuing Bank shall not issue any Letter of Credit if, after
giving effect to such issuance, such Issuing Bank has actual
knowledge that (i) the L/C Obligations would exceed the L/C
Commitment, (ii) the Available Commitment would be less than zero
or (iii) if the Letter of Credit to be issued is a Special Letter
of Credit, the aggregate amount of L/C Obligations on account of
Special Letters of Credit to be outstanding after giving effect
to the issuance thereof will be more than $350,000,000.
(b) Each Letter of Credit shall:
(i) be either (1) a standby letter of credit issued to
support obligations of the Borrower and its Subsidiaries,
contingent or otherwise, for which Revolving Credit Loans
would be available (a "Standby Letter of Credit"), or (2) a
commercial letter of credit (including, without limitation,
a Special Letter of Credit) issued in respect of the
purchase of goods or services by the Borrower and its
Subsidiaries in the ordinary course of business (a
"Commercial Letter of Credit");
(ii) unless such Letter of Credit is a Special Letter
of Credit, be (1) issued from an office of the Issuing Bank
in the United States and (2) denominated in Dollars; and
(iii) expire no later than the earlier of (1) one year
following the date of issuance thereof and (2) five days
prior to the Termination Date; provided that any Letter of
Credit may provide for renewal thereof for additional one-
year periods on an "evergreen" basis (but not, in any event,
beyond the date referred to in clause (2) above).
(c) Each Letter of Credit shall be subject to the
Uniform Customs and, to the extent not inconsistent therewith,
the laws of the State of New York.
(d) No Issuing Bank shall at any time be obligated to
issue any Letter of Credit hereunder if such issuance would
conflict with, or cause such Issuing Bank or any L/C Participant
to exceed any limits imposed by, any applicable Requirement of
Law.
4.2 Procedure for Issuance of Letters of Credit. The
Borrower may from time to time give notice to the Administrative
Agent that the Borrower desires to have a Letter of Credit issued
for its account and specifying the proposed Issuing Bank with
respect to such Letter of Credit. In the event that the proposed
Issuing Bank is reasonably acceptable to the Administrative
Agent, the Borrower shall request that such Issuing Bank issue a
Letter of Credit by delivering to such Issuing Bank (with a copy
of such Application to the Administrative Agent, in the case of
any Standby Letter of Credit) at its address for notices
specified herein an Application therefor, completed to the
satisfaction of the Issuing Bank, and such other certificates,
documents and other papers and information as the Issuing Bank
may request. Upon receipt of any Application, the Issuing Bank
will process such Application and the certificates, documents and
other papers and information delivered to it in connection
therewith in accordance with its customary procedures and shall
promptly issue the Letter of Credit requested thereby by issuing
the original of such Letter of Credit to the beneficiary thereof
or as otherwise may be agreed by the Issuing Bank and the
Borrower; provided that the Issuing Bank shall in no event be
required to issue any Letter of Credit earlier than two Business
Days (or, in the case of Standby Letters of Credit, three
Business Days) after its receipt of the Application therefor and
all such other certificates, documents and other papers and
information relating thereto. In the event that the Letter of
Credit to be issued is a Standby Letter of Credit, the Issuing
Bank shall furnish a copy of such Standby Letter of Credit to
each of the Administrative Agent and the Borrower promptly
following the issuance thereof.
4.3 Fees, Commissions and Other Charges. (a) The
Borrower shall pay to:
(i) the relevant Issuing Bank, for its own account, a
letter of credit commission with respect to each Special
Letter of Credit issued by such Issuing Bank, computed for
each day during the period when such Special Letter of
Credit is outstanding at the rate per annum equal to the
face amount of such Letter of Credit times the rate which is
mutually agreed between the Borrower and such Issuing Bank
(which rate shall not, in any event, exceed the Applicable
Commitment Fee Rate in effect on the date of issuance of
such Special Letter of Credit); and
(ii) the Administrative Agent, for the account of
each Issuing Bank and the L/C Participants, a letter of
credit commission with respect to each other Commercial
Letter of Credit issued by such Issuing Bank, computed for
each day during the period when such Commercial Letter of
Credit is outstanding at the rate per annum equal to the
face amount of such Letter of Credit times the Applicable
Commitment Fee Rate on the date of payment.
Such commission shall be calculated on the basis of a 365- or
366-day year (as the case may be) and shall be payable, in
arrears, on each L/C Fee Payment Date to occur after the date of
issuance of such Letter of Credit and shall be nonrefundable.
(b) The Borrower shall pay to the Administrative
Agent, for the account of each Issuing Bank and the L/C
Participants, a letter of credit commission with respect to each
Standby Letter of Credit issued by such Issuing Bank, computed
for each day during the period for which payment is due at the
rate per annum equal to the Applicable Margin in effect for
Eurodollar Loans on such date (calculated on the basis of a 365-
or 366-day year, as the case may be) times the aggregate amount
available to be drawn under such Standby Letter of Credit on such
date. Such commissions shall be payable, in arrears, on each L/C
Fee Payment Date to occur after the issuance of such Standby
Letter of Credit and shall be nonrefundable.
(c) The Borrower shall pay to the relevant Issuing
Bank, for its own account, a fronting fee in the amount equal to
(i) 1/8 of 1% of the face amount of each Commercial Letter of
Credit (other than any Special Letter of Credit) issued by such
Issuing Bank and (ii) 1/8 of 1% per annum on the face amount of
each Standby Letter of Credit issued by it. Such fronting fees
shall be calculated on the basis of a 365- or 366-day year (as
the case may be) and shall payable, in arrears, on each L/C Fee
Payment Date with respect to any such Letters of Credit which
were outstanding during the period for which payment is due.
Notwithstanding anything to the contrary contained herein, no
such fronting fee shall be payable with respect to any Special
Letter of Credit.
(d) In addition to the foregoing fees and commissions,
the Borrower shall pay or reimburse each Issuing Bank for such
normal and customary costs and expenses as are incurred or
charged by such Issuing Bank in issuing, effecting payment under,
amending or otherwise administering any Letter of Credit issued
by it.
(e) The Administrative Agent shall, promptly following
its receipt thereof, distribute to the relevant Issuing Bank and
the L/C Participants all fees and commissions received by the
Administrative Agent for their respective accounts pursuant to
this subsection 4.3.
4.4 L/C Participations. (a) Each Issuing Bank
irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce such Issuing Bank to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the
Issuing Bank, on the terms and conditions hereinafter stated, for
such L/C Participant's own account and risk an undivided interest
equal to such L/C Participant's Revolving Credit Commitment
Percentage in the Issuing Bank's obligations and rights under
each Letter of Credit issued by it hereunder and the amount of
each draft paid by the Issuing Bank thereunder. Each L/C
Participant unconditionally and irrevocably agrees with such
Issuing Bank that, if a draft is paid under any Letter of Credit
for which such Issuing Bank is not reimbursed in full by the
Borrower in accordance with the terms of this Agreement, such L/C
Participant shall pay to such Issuing Bank (through the
Administrative Agent) upon demand an amount equal to such L/C
Participant's Revolving Credit Commitment Percentage of the
amount of such draft, or any part thereof, which is not so
reimbursed (or, in the case of any Special Letter of Credit which
is not denominated in Dollars, the amount of Dollars necessary so
that, following conversion by the Issuing Bank into the relevant
denomination currency at the spot rate of exchange available to
the Issuing Bank on the date of payment, such L/C Participant
shall have purchased its ratable share of such draft).
(b) If any amount required to be paid by any L/C
Participant to an Issuing Bank pursuant to paragraph 4.4(a) in
respect of any unreimbursed portion of any payment made by such
Issuing Bank under any Letter of Credit issued by it is paid to
such Issuing Bank within three Business Days after the date such
payment is due, such L/C Participant shall pay to such Issuing
Bank (through the Administrative Agent) on demand an amount equal
to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate (or, with respect to Special Letters
of Credit which are not denominated in Dollars, the rate which
reasonably represents such Issuing Bank's cost of funds), as
quoted by such Issuing Bank, during the period from and including
the date such payment is required to the date on which such
payment is immediately available to such Issuing Bank, times
(iii) a fraction the numerator of which is the number of days
that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C
Participant pursuant to paragraph 4.4(a) is not in fact made
available to such Issuing Bank by such L/C Participant within
three Business Days after the date such payment is due, such
Issuing Bank shall be entitled to recover from such L/C
Participant, on demand, such amount with interest thereon
calculated from such due date at the rate per annum applicable to
ABR Loans hereunder (or, in the case of Special Letters of Credit
which are not denominated in Dollars, at a rate equal to the rate
which is reasonably determined by such Issuing Bank to reflect
its cost of funding in the relevant currency plus the Applicable
Margin then in effect with respect to ABR Loans). A certificate
of such Issuing Bank submitted to any L/C Participant (through
the Administrative Agent) with respect to any amounts owing under
this subsection 4.4 shall be conclusive in the absence of
manifest error.
(c) Whenever, at any time after an Issuing Bank has
made payment under any Letter of Credit and has received from any
L/C Participant its pro rata share of such payment in accordance
with subsection 4.4(a), such Issuing Bank receives any payment
related to such Letter of Credit (whether directly from the
Borrower or otherwise, including proceeds of collateral applied
thereto by such Issuing Bank), or any payment of interest on
account thereof, such Issuing Bank will distribute to the
Administrative Agent (for the account of such L/C Participant)
such L/C Participant's pro rata share thereof; provided, however,
that in the event that any such payment received by such Issuing
Bank shall be required to be returned by such Issuing Bank, such
L/C Participant shall return to such Issuing Bank (through the
Administrative Agent) the portion thereof previously distributed
by such Issuing Bank to it.
4.5 Reimbursement Obligation of the Borrower.
(a) The Borrower agrees to reimburse each Issuing Bank on each
date on which such Issuing Bank notifies the Borrower of the date
and amount of a draft presented under any Letter of Credit issued
by such Issuing Bank and paid by such Issuing Bank for the amount
of (i) such draft so paid and (ii) any taxes, fees, charges or
other costs or expenses incurred by such Issuing Bank in
connection with such payment. Each such payment shall be made to
such Issuing Bank at its address for notices specified herein in
Dollars (or, in the case of any Special Letter of Credit which is
not denominated in Dollars, in lawful money in the currency in
which such Special Letter of Credit is denominated) and in
immediately available funds.
(b) Interest shall be payable on any and all amounts
remaining unpaid by the Borrower under this subsection 4.5 from
the date such amounts become payable (whether at stated maturity,
by acceleration or otherwise) until payment in full at the rate
which would be payable on any outstanding ABR Loans which were
then overdue (or, in the case of Special Letters of Credit which
are not denominated in Dollars, at a rate equal to the rate which
is reasonably determined by the relevant Issuing Bank to reflect
its cost of funding in the relevant currency plus 2% above the
Applicable Margin then in effect with respect to ABR Loans).
(c) Each drawing under any Letter of Credit shall
(unless it is reimbursed by the Borrower on the date of drawing)
constitute a request by the Borrower to the Administrative Agent
for a borrowing pursuant to subsection 3.2 of ABR Loans in the
amount of such drawing (or, in the case of a drawing under a
Special Letter of Credit, for a borrowing of ABR Loans in the
amount which is reasonably determined by the Administrative Agent
to be the Dollar equivalent of the amount in the relevant
currency of such drawing). The borrowing date with respect to
such borrowing shall be the date of such drawing.
4.6 Obligations Absolute. (a) The Borrower's
obligations under this Section 4 shall be absolute and
unconditional under any and all circumstances and irrespective of
any set-off, counterclaim or defense to payment which the
Borrower may have or have had against any Issuing Bank or any
beneficiary of a Letter of Credit.
(b) The Borrower also agrees with each Issuing Bank
that such Issuing Bank shall not be responsible for, and the
Borrower's Reimbursement Obligations under subsection 4.5(a)
shall not be affected by, among other things, (i) the validity or
genuineness of documents or of any endorsements thereon, even
though such documents shall in fact prove to be invalid,
fraudulent or forged, or (ii) any dispute between or among the
Borrower and any beneficiary of any Letter of Credit or any other
party to which such Letter of Credit may be transferred or (iii)
any claims whatsoever of the Borrower against any beneficiary of
such Letter of Credit or any such transferee.
(c) No Issuing Bank shall be liable for any error,
omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in
connection with any Letter of Credit issued by such Issuing Bank,
except for errors or omissions caused by such Issuing Bank's
gross negligence or willful misconduct.
(d) The Borrower agrees that any action taken or
omitted by an Issuing Bank under or in connection with any Letter
of Credit or the related drafts or documents, if done in the
absence of gross negligence of willful misconduct and in
accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on the
Borrower and shall not result in any liability of such Issuing
Bank to the Borrower.
4.7 Letter of Credit Payments. The responsibility of
each Issuing Bank to the Borrower in connection with any draft
presented for payment under any Letter of Credit shall, in
addition to any payment obligation expressly provided for in such
Letter of Credit, be limited to determining that the documents
(including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such
Letter of Credit.
4.8 Application. To the extent that any provision of
any Application related to any Letter of Credit is inconsistent
with the provisions of this Section 4, the provisions of this
Section 4 shall apply.
4.9 Reporting by Issuing Banks. (a) Each Issuing
Bank hereby agrees to provide to the Administrative Agent prompt
notice of (i) the issuance by it of any Letter of Credit, (ii)
the amendment of any Letter of Credit issued by it, (iii) the
termination thereof, (iv) the presentation of any draft
thereunder and (v) the reimbursement by the Borrower of such
draft; provided, however, that, with respect to Commercial
Letters of Credit, such notice shall take the form of a summary
report which shall be provided to the Administrative Agent (x) on
the first Business Day of each week, (y) on the last Business Day
of each calendar month and (z) at such other times (including,
without limitation, daily) as the Administrative Agent may from
time to time request.
(b) Each Issuing Bank hereby agrees to provide to the
Administrative Agent, on the last Business Day of each calendar
month, a summary showing the outstanding balances of the Letters
of Credit (other than Special Letters of Credit) issued by such
Issuing Bank on each day during the month then ended.
4.10 Existing Standby Letters of Credit.
Notwithstanding anything to the contrary contained in this
Agreement or any Security Document, each of the standby letters
of credit described on Schedule VIII shall, from and after the
Closing Date, be deemed to have been issued pursuant to this
Section 4, with the Lender set forth in said Schedule VIII as the
issuing bank for each such existing standby letter of credit
being deemed to be the Issuing Bank in respect of such Standby
Letter of Credit hereunder and with each other Lender being
deemed to be an L/C Participant with respect to such Standby
Letter of Credit for purposes of this Agreement and the Security
Documents. The Borrower shall pay to the Administrative Agent,
for the accounts of the relevant Issuing Bank and L/C
Participants (or, in the case of the fees contemplated by
subsection 4.3(c), to the relevant Issuing Bank, for its own
account), the fees and commissions described in subsection 4.3
with respect to each such Standby Letter of Credit.
SECTION 5. PROVISIONS RELATING TO THE EXTENSIONS OF
CREDIT; FEES AND PAYMENTS
5.1 Repayment of Loans; Evidence of Debt. (a) The
Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each applicable Lender
(i) the then unpaid principal amount of each Revolving Credit
Loan of such Lender on the Termination Date (or such earlier date
on which the Revolving Credit Loans become due and payable
pursuant to Section 10), and (ii) the principal amount of the
Term Loan on the dates and in the amounts set forth in subsection
2.3 (or the then unpaid principal amount of such Term Loan, on
the date that the Term Loans become due and payable pursuant to
Section 10). The Borrower hereby further agrees to pay interest
on the unpaid principal amount of the Loans from time to time
outstanding from the date hereof until payment in full thereof at
the rates per annum, and on the dates, set forth in subsection
5.8.
(b) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing indebtedness of
the Borrower to such Lender resulting from each Loan of such
Lender from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time under
this Agreement.
(c) The Administrative Agent shall maintain the
Register pursuant to subsection 12.7(d), and a subaccount therein
for each Lender, in which shall be recorded (i) the amount of
each Revolving Credit Loan and Term Loan made hereunder, the Type
thereof and each Interest Period applicable thereto, (ii) the
amount of any principal or interest due and payable or to become
due and payable from the Borrower to each Lender hereunder and
(iii) both the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share
thereof.
(d) The entries made in the Register and the accounts
of each Lender maintained pursuant to subsection 5.1(b) shall, to
the extent permitted by applicable law, be prima facie evidence
of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner
affect the obligation of the Borrower to repay (with applicable
interest) the Loans made to such Borrower by such Lender in
accordance with the terms of this Agreement.
(e) The Borrower agrees that, upon request of any
Lender through the Administrative Agent, the Borrower will
execute and deliver to such Lender (i) a promissory note of the
Borrower evidencing the Term Loan of such Lender, substantially
in the form of Exhibit A with appropriate insertions as to date
and principal amount (a "Term Note") and/or (ii) a promissory
note of the Borrower evidencing the Revolving Credit Loans of
such Lender, substantially in the form of Exhibit B with
appropriate insertions as to date and principal amount (a
"Revolving Credit Note"), to the extent necessary (in each such
case) to permit such Lender to assign any Loan to a Federal
Reserve Bank.
5.2 Commitment Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment
fee for each day during the period from and including the first
day of the Commitment Period to the Termination Date, computed at
the rate per annum equal to the Applicable Commitment Fee Rate in
effect on such date times the Available Commitment of such Lender
on such day. Such commitment fee shall be payable quarterly, in
arrears, on the last Business Day of each March, June, September
and December and on the Termination Date or such earlier date as
the Revolving Credit Commitments shall terminate as provided
herein, commencing on the first of such dates to occur after the
date hereof.
5.3 Optional Prepayments. The Borrower may at any
time and from time to time prepay the Loans, in whole or in part,
without premium or penalty, upon at least three Business Days'
(or, in the case of prepayments of ABR Loans, one Business Day's)
irrevocable notice to the Administrative Agent (which notice must
be received by the Administrative Agent prior to 10:00 A.M., New
York City time, on the date upon which such notice is due),
specifying the date and amount of prepayment and whether the
prepayment is of Eurodollar Loans, ABR Loans or a combination
thereof, and, if of a combination thereof, the amount allocable
to each. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. If any such
notice is given, the amount specified in such notice shall be due
and payable on the date specified therein, together with any
amounts payable pursuant to subsection 5.15 and, except in the
case of prepayments of Revolving Credit Loans which are ABR
Loans, accrued interest to such date on the amount prepaid.
Partial prepayments of the Term Loans shall be applied ratably to
the remaining installments of principal thereof. Amounts prepaid
on account of the Term Loans may not be reborrowed. Partial
prepayments shall be in an aggregate principal amount of
$10,000,000 or a whole multiple of $1,000,000 in excess thereof.
5.4 Optional Termination or Reduction of Commitments.
The Borrower shall have the right, upon not less than five
Business Days' notice to the Administrative Agent, to terminate
the Commitments or, from time to time, to reduce the amount of
the Commitments; provided that no such termination or reduction
shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans made on the effective
date thereof, the aggregate principal amount of the Revolving
Credit Loans then outstanding, when added to the then outstanding
L/C Obligations, would exceed the Revolving Credit Commitments
then in effect. Any such reduction shall be in an amount equal
to $10,000,000 or a whole multiple of $1,000,000 in excess
thereof and shall reduce permanently the affected Commitments
then in effect.
5.5 Mandatory Reduction of Commitments and
Prepayments. (a) If at any time the Aggregate Outstanding
Extensions of Credit of all Lenders exceeds the Revolving Credit
Commitments then in effect (including, without limitation, as a
result of any permanent reduction of the Revolving Credit
Commitments pursuant to subsection 5.4 or this subsection 5.5),
the Borrower shall immediately repay the Revolving Credit Loans
(and, to the extent necessary, cash collateralize the L/C
Obligations) by the amount equal to such excess.
(b) During such time as the Borrower is not
maintaining an Investment Grade Rating, the Borrower shall, as
promptly as is practicable (and, in any event, within one
Business Day following the receipt thereof), repay the Loans and
reduce the Commitments by the amount equal to the aggregate
amount of Net Proceeds received from any Net Proceeds Event;
provided that no such repayment and reduction shall be due
pursuant to this subsection 5.5(b) with respect to any Net
Proceeds Event on account of:
(i) the issuance or sale to third parties of Capital
Stock of the ▇▇▇▇ ▇▇▇▇▇▇ Subsidiary in connection with the
consummation of the ▇▇▇▇ ▇▇▇▇▇▇ Transaction;
(ii) the sale, transfer or other disposition by the
Borrower or any of its Subsidiaries of any real or personal,
tangible or intangible, property of the Borrower and its
Subsidiaries, to the extent that the Net Proceeds from such
sale, transfer or other disposition (in the aggregate with
the Net Proceeds from all other sales, transfers and other
dispositions occurring during such fiscal year) is less than
$6,000,000; or
(iii) the recovery by the Borrower of amounts owing to
it under property insurance policies, except to the extent
that (A) either (1) such recoveries exceed the reasonably
estimated cost of replacing the property on account of which
such amounts were paid to the Borrower and its Subsidiaries
or (2) the Borrower and its Subsidiaries are not diligently
proceeding with such replacement and (B) with respect to
recoveries by Foreign Subsidiaries of the Borrower, such
amounts can be repatriated to the United States without the
incurrence (or material acceleration) of significant tax
liability.
Any repayment of Loans and reduction of Commitments required by
this subsection 5.5(b) shall be made in accordance with the
provisions of subsection 5.5(d).
(c) The Borrower shall repay the Loans and reduce the
Aggregate Commitment within one Business Day following delivery
of the certificate referenced in subsection 8.2(b) (commencing
with the certificate covering the fiscal year ending on December
31, 1996) by the amount equal to 50% of Excess Cash Flow for the
fiscal year covered by such certificate, with any such repayment
of Loans and reduction of Aggregate Commitment being made in
accordance with the provisions of subsection 5.5(d); provided
that no such repayment and reduction shall be required pursuant
to this subsection 5.5(c) to the extent that the Borrower is
maintaining an Investment Grade Rating on the date that such
prepayment is due.
(d) Any payments of the Loans and reductions of the
Commitments made pursuant to subsection 5.5(b) or (c) shall be
applied, first, to the prepayment of the Term Loans (with such
prepayment being applied ratably to the then outstanding
installments thereof) and, second, to reduce the Revolving Credit
Commitments. Unless the Borrower otherwise elects, the
application of prepayments made pursuant to this subsection 5.5
shall be made, first, to ABR Loans and, second, to Eurodollar
Loans.
5.6 Conversion and Continuation Options. (a) The
Borrower may elect from time to time to convert Eurodollar Loans
to ABR Loans by delivering to the Administrative Agent an
irrevocable Notice of Borrowing by 10:00 A.M., New York City
time, at least one Business Day prior to the requested date of
conversion; provided that any such conversion of Eurodollar Loans
may only be made on the last day of an Interest Period with
respect thereto. The Borrower may elect from time to time to
convert ABR Loans to Eurodollar Loans by delivering to the
Administrative Agent an irrevocable Notice of Borrowing by 10:00
A.M., New York City time, at least three Business Days' prior to
the requested conversion date. Any such Notice of Borrowing with
respect to a conversion to Eurodollar Loans shall specify the
length of the initial Interest Period or Interest Periods
therefor. Upon receipt of any such Notice of Borrowing, the
Administrative Agent shall promptly notify each Lender thereof.
All or any part of outstanding Eurodollar Loans and ABR Loans may
be converted as provided herein, provided that (i) no Loan may be
converted into a Eurodollar Loan when any Event of Default has
occurred and is continuing and the Administrative Agent has or
the Required Lenders have determined that such a conversion is
not appropriate and (ii) no Loan may be converted into a
Eurodollar Loan after the date that is one month prior to the
Termination Date (in the case of conversions of Revolving Credit
Loans) or the date of the final installment of principal of the
Term Loans.
(b) Any Eurodollar Loans may be continued as such upon
the expiration of the then current Interest Period with respect
thereto by the Borrower delivering to the Administrative Agent an
irrevocable Notice of Borrowing, in accordance with the
applicable provisions of the term "Interest Period" set forth in
subsection 1.1, of the length of the next Interest Period to be
applicable to such Loans, provided that no Eurodollar Loan may be
continued as such (i) when any Event of Default has occurred and
is continuing and the Administrative Agent has or the Required
Lenders have determined that such a continuation is not
appropriate or (ii) after the date that is one month prior to the
Termination Date (in the case of continuations of Revolving
Credit Loans) or the date of the final installment of principal
of the Term Loans and provided, further, that if the Borrower
shall fail to give such notice or if such continuation is not
permitted such Loans shall be automatically converted to ABR
Loans on the last day of such then expiring Interest Period.
Upon receipt of any such Notice of Borrowing, the Administrative
Agent shall promptly notify each Lender thereof.
5.7 Minimum Amounts and Maximum Number of Tranches.
All borrowings, conversions and continuations of Eurodollar Loans
hereunder and all selections of Interest Periods hereunder shall
be in such amounts and be made pursuant to such elections so
that, after giving effect thereto, the aggregate principal amount
of the Eurodollar Loans comprising each Tranche shall be equal to
$10,000,000 or a whole multiple of $1,000,000 in excess thereof.
In no event shall there be more than 15 Tranches of Eurodollar
Loans outstanding at any time.
5.8 Interest Rates and Payment Dates. (a) Each
Eurodollar Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to
the Eurodollar Rate determined for such day plus the then
Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per
annum equal to the ABR plus the then Applicable Margin.
(c) If all or a portion of (i) any principal of any
Loan, (ii) any interest payable thereon, (iii) any commitment fee
or (iv) any other amount payable hereunder shall not be paid when
due (whether at the stated maturity, by acceleration or
otherwise), the principal of the Loans and any such overdue
interest, commitment fee or other amount shall bear interest at a
rate per annum which is (x) in the case of principal, the rate
that would otherwise be applicable thereto pursuant to the
foregoing provisions of this subsection plus 2% or (y) in the
case of any such overdue interest, commitment fee or other
amount, the rate described in paragraph (b) of this subsection
plus 2%, in each case from the date of such non-payment until
such overdue principal, interest, commitment fee or other amount
is paid in full (as well after as before judgment).
(d) Interest shall be payable in arrears on each
Interest Payment Date, provided that interest accruing pursuant
to paragraph (c) of this subsection shall be payable from time to
time on demand.
(e) Notwithstanding anything to the contrary contained
herein, in no event shall the Borrower be obligated to pay
interest in excess of the maximum amount which is chargeable
under applicable law.
5.9 Computation of Interest and Fees. (a) Commitment
fees and, whenever it is calculated on the basis of the Prime
Rate, interest shall be calculated on the basis of a 365- (or
366-, as the case may be) day year for the actual days elapsed;
and, otherwise, interest shall be calculated on the basis of a
360-day year for the actual days elapsed. The Administrative
Agent shall as soon as practicable notify the Borrower and the
Lenders of each determination of a Eurodollar Rate. Any change
in the interest rate on a Loan resulting from a change in the ABR
or the Eurocurrency Reserve Requirements shall become effective
as of the opening of business on the day on which such change
becomes effective. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of the effective
date and the amount of each such change in interest rate. Any
change in the Applicable Margin or Applicable Commitment Fee Rate
resulting from a change in the Pricing Ratio shall become
effective on the date upon which the financial statements showing
such change which are required to be delivered pursuant to
subsection 8.1(a) or (b), as the case may be, are received by the
Administrative Agent.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement
shall be conclusive and binding on the Borrower and the Lenders
in the absence of manifest error. The Administrative Agent
shall, at the request of the Borrower, deliver to the Borrower a
statement showing the quotations used by the Administrative Agent
in determining any interest rate pursuant to subsection 5.8(a).
5.10 Inability to Determine Interest Rate. If prior
to the first day of any Interest Period:
(a) the Administrative Agent shall have determined
(which determination shall be conclusive and binding upon
the Borrower) that, by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist
for ascertaining the Eurodollar Rate for such Interest
Period, or
(b) the Administrative Agent shall have received
notice from the Majority Lenders that the Eurodollar Rate
determined or to be determined for such Interest Period will
not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest
Period,
the Administrative Agent shall give telecopy or telephonic notice
thereof to the Borrower and the Lenders as soon as practicable
thereafter. If such notice is given (x) any Eurodollar Loans
requested to be made on the first day of such Interest Period
shall be made as ABR Loans, (y) any Loans that were to have been
converted on the first day of such Interest Period to Eurodollar
Loans shall be converted to or continued as ABR Loans and (z) any
outstanding Eurodollar Loans shall be converted, on the first day
of such Interest Period, to ABR Loans. Until such notice has
been withdrawn by the Administrative Agent, no further Eurodollar
Loans shall be made or continued as such, nor shall the Borrower
have the right to convert Loans to Eurodollar Loans.
5.11 Pro Rata Treatment and Payments. (a) Each
borrowing by the Borrower from the Lenders hereunder, each
payment by the Borrower on account of any commitment fee
hereunder and any reduction of the Commitments of the Lenders
shall be made pro rata according to the respective relevant
Commitment Percentages of the Lenders holding obligations in
respect of which such amounts were paid. Each payment (including
each prepayment) by the Borrower on account of principal of and
(subject to the provisions of subsection 5.12) interest on the
Loans shall be made pro rata according to the respective
outstanding principal amounts of such Loans then held by the
Lenders. Except as otherwise set forth herein, all payments
(including prepayments) to be made by the Borrower hereunder,
whether on account of principal, interest, fees or otherwise,
shall be made without set off or counterclaim and shall be made
prior to 12:00 Noon, New York City time, on the due date thereof
to the Administrative Agent, for the account of the applicable
Lenders, at the Administrative Agent's office specified in
subsection 12.3, in Dollars and in immediately available funds.
The Administrative Agent shall distribute such payments to the
Lenders holding obligations on account of which such amounts were
paid promptly upon receipt in like funds as received. If any
payment hereunder becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of
principal, interest thereon shall be payable at the then
applicable rate during such extension.
(b) Unless the Administrative Agent shall have been
notified in writing by any Lender prior to a borrowing that such
Lender will not make the amount that would constitute its
relevant Commitment Percentage of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that
such Lender is making such amount available to the Administrative
Agent, and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the
Administrative Agent by the required time on the borrowing date
therefor, such Lender shall pay to the Administrative Agent, on
demand, such amount with interest thereon at a rate equal to the
daily average Federal Funds Effective Rate for the period until
such Lender makes such amount immediately available to the
Administrative Agent. A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under
this subsection 5.11 shall be conclusive in the absence of
manifest error. If such Lender's relevant Commitment Percentage
of such borrowing is not made available to the Administrative
Agent by such Lender within three Business Days of such borrowing
date, the Administrative Agent shall also be entitled to recover
such amount with interest thereon at the rate per annum
applicable to ABR Loans hereunder, on demand, from the Borrower.
5.12 Illegality. Notwithstanding any other provision
herein, if the adoption of or any change in any Requirement of
Law or in the interpretation or application thereof shall make it
unlawful for any Lender to make or maintain Eurodollar Loans as
contemplated by this Agreement, (a) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as
such and convert ABR Loans to Eurodollar Loans shall forthwith be
cancelled and (b) such Lender's Loans then outstanding as
Eurodollar Loans, if any, shall be converted automatically to ABR
Loans on the respective last days of the then current Interest
Periods with respect to such Loans or within such earlier period
as required by law. If any such conversion of a Eurodollar Loan
occurs on a day which is not the last day of the then current
Interest Period with respect thereto, the Borrower shall pay to
such Lender such amounts, if any, as may be required pursuant to
subsection 5.15.
5.13 Requirements of Law. (a) If the adoption of or
any change in any Requirement of Law or in the interpretation or
application thereof or compliance by any Lender with any request
or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to
the date hereof:
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Note, any
Letter of Credit, any Application or any Eurodollar Loan
made by it, or change the basis of taxation of payments to
such Lender in respect thereof (except for Non-Excluded
Taxes covered by subsection 5.14 and changes in the rate of
net income taxes or franchise taxes (imposed in lieu of net
income taxes) of such Lender);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of
funds by, any office of such Lender which is not otherwise
included in the determination of the Eurodollar Rate
hereunder; or
(iii) shall impose on such Lender any other
condition;
and the result of any of the foregoing is to increase the cost to
such Lender, by an amount which such Lender deems to be material,
of making, converting into, continuing or maintaining Eurodollar
Loans or issuing or participating in Letters of Credit or to
reduce any amount receivable hereunder in respect thereof, then,
in any such case, the Borrower shall promptly pay such Lender
such additional amount or amounts as will compensate such Lender
for such increased cost or reduced amount receivable.
(b) If any Lender shall have determined that the
adoption of or any change in any Requirement of Law regarding
capital adequacy or in the interpretation or application thereof
or compliance by such Lender or any corporation controlling such
Lender with any request or directive regarding capital adequacy
(whether or not having the force of law, if compliance therewith
is a customary banking practice) from any Governmental Authority
made subsequent to the date hereof shall have the effect of
reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations
hereunder or under any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for
such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to
capital adequacy) by an amount deemed by such Lender to be
material, then from time to time, the Borrower shall promptly pay
to such Lender such additional amount or amounts as will
compensate such Lender for such reduction.
(c) If any Lender becomes entitled to claim any
additional amounts pursuant to this subsection 5.13, it shall
promptly notify the Borrower (with a copy to the Administrative
Agent) of the event by reason of which it has become so entitled.
A certificate as to any additional amounts payable pursuant to
this subsection 5.13 submitted by such Lender to the Borrower
(with a copy to the Administrative Agent) shall be conclusive in
the absence of manifest error. The agreements in this subsection
5.13 shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
5.14 Taxes. (a) All payments made by the Borrower
under this Agreement and any Notes shall be made free and clear
of, and without deduction or withholding for or on account of,
any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by
any Governmental Authority, excluding net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on
the Administrative Agent or any Lender as a result of a present
or former connection between the Administrative Agent or such
Lender 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 the Administrative Agent or such Lender
having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement or any
Note). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes")
are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder or under any Note,
the amounts so payable to the Administrative Agent or such Lender
shall be increased to the extent necessary to yield to the
Administrative Agent or such Lender (after payment of all Non-
Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this
Agreement, provided, however, that the Borrower shall not be
required to increase any such amounts payable to any Lender that
is not organized under the laws of the United States of America
or a state thereof if such Lender fails to comply with the
requirements of paragraph (b) of this subsection. Whenever any
Non-Excluded Taxes are payable by the Borrower, as promptly as
possible thereafter the Borrower shall send to the Administrative
Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the
Administrative Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such
failure. The agreements in this subsection 5.14 shall survive
the termination of this Agreement and the payment of the Loans
and all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the
laws of the United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative
Agent (A) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, and (B) an Internal
Revenue Service Form W-8 or W-9, or successor applicable
form, as the case may be;
(ii) deliver to the Borrower and the Administrative
Agent two further copies of any such form or certification
on or before the date that any such form or certification
expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recent form previously
delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Administrative Agent;
unless in any such case an event (including, without limitation,
any change in treaty, law or regulation) has occurred prior to
the date on which any such delivery would otherwise be required
which renders all such forms inapplicable or which would prevent
such Lender from duly completing and delivering any such form
with respect to it and such Lender so advises the Borrower and
the Administrative Agent. Such Lender shall certify (i) in the
case of a Form 1001 or 4224, that it is entitled to receive
payments under this Agreement without deduction or withholding of
any United States federal income taxes and (ii) in the case of a
Form W-8 or W-9, that it is entitled to an exemption from United
States backup withholding tax. Each Person that shall become a
Lender or a Participant pursuant to subsection 12.7 shall, upon
the effectiveness of the related transfer, be required to provide
all of the forms and statements required pursuant to this
subsection 5.14, provided that in the case of a Participant such
Participant shall furnish all such required forms and statements
to the Lender from which the related participation shall have
been purchased.
(c) If any Lender shall receive a credit or refund
from a taxing authority with respect to, and actually resulting
from, an amount of Non-Excluded Taxes actually paid to or on
behalf of such Lender by the Borrower (a "Tax Credit"), such
Lender shall promptly notify the Borrower of such Tax Credit. If
such Tax Credit is received by such Lender in the form of cash,
such Lender shall promptly pay to the Borrower the amount so
received with respect to the Tax Credit. If such Tax Credit is
not received by such Lender in the form of cash, such Lender
shall pay the amount of such Tax Credit not later than the time
prescribed by applicable Law for filing the return (including
extensions of time) for such Lender's taxable period which
includes the period in which such Lender receives the economic
benefit of such Tax Credit. In any event, the amount of any Tax
Credit payable by a Lender to the Borrower pursuant to this
clause (c) shall not exceed the actual amount of cash refunded
to, or credits received and usable (in accordance with the actual
practices then in use by such Lender) by, such Lender from a
taxing authority. In determining the amount of any Tax Credit, a
Lender may use such apportionment and attribution rules as such
Lender customarily employs in allocating taxes among its various
operations and income sources and such determination shall be
conclusive absent manifest error. The Borrower further agrees
promptly to return to a Lender the amount paid to the Borrower
with respect to a Tax Credit by such Lender if such Lender is
required to repay, or is determined to be ineligible for, a Tax
Credit for such amount. Notwithstanding anything to the contrary
contained herein, the Borrower hereby acknowledges and agrees
that (i) neither the Administrative Agent nor any Lender shall be
obligated to provide the Borrower with details of the tax
position of the Administrative Agent or such Lender (as the case
may be) and (ii) the Borrower shall have no right to inspect any
records (including tax returns) of the Administrative Agent or
such Lender (as the case may be).
5.15 Indemnity. The Borrower agrees to indemnify each
Lender and to hold each Lender harmless from any loss or expense
which such Lender may sustain or incur as a consequence of
(a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans after the Borrower has
given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in
making any prepayment after the Borrower has given a notice
thereof in accordance with the provisions of this Agreement or
(c) the making of a prepayment of Eurodollar Loans on a day which
is not the last day of an Interest Period with respect thereto.
Such indemnification may include an amount equal to the excess,
if any, of (i) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of
such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow,
convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the
applicable rate of interest for such Loans provided for herein
(excluding, however, the Applicable Margin included therein, if
any) over (ii) the amount of interest (as reasonably determined
by such Lender) which would have accrued to such Bank on such
amount by placing such amount on deposit for a comparable period
with leading banks in the interbank eurodollar market. This
covenant shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
5.16 Change of Lending Office. Each Lender agrees
that if it makes any demand for payment under subsection 5.13 or
5.14(a), or if any adoption or change of the type described in
subsection 5.12 shall occur with respect to it, it will use
reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions and so long as such efforts would not
be disadvantageous to it, as determined in its good faith
discretion) to designate a different lending office if the making
of such a designation would reduce or obviate the need for the
Borrower to make payments under subsection 5.13 or 5.14(a), or
would eliminate or reduce the effect of any adoption or change
described in subsection 5.12.
5.17 Additional Action in Certain Events. (a) In the
event that any event or condition described in Section 5.12, 5.13
or 5.14(a) has occurred and is continuing that increases the cost
to the Borrower of the Loans by any Lender, the Borrower may
(after paying any accrued amounts required to be paid pursuant to
Section 5.12, 5.13 or 5.14(a) hereof, as the case may be, for the
period prior to the taking of such action) require any Lender so
affected by such event or condition to transfer or assign, in
whole (but not in part), without recourse, its Commitments and
Loans hereunder in accordance with the provisions of subsection
12.7(c) to one or more Assignees (which need not be existing
Lenders hereunder, but which may not request payment from the
Borrower of any such amounts on account of the same event or
condition which affects the assigning Lender) identified to it by
the Borrower.
(b) In the event that any Lender shall fail to execute
and deliver any amendment, supplement or modification hereto
requested by the Borrower, the Borrower may (within 30 days
following the requested response date for such amendment,
supplement or modification) require such Lender to transfer or
assign, in whole (but not in part), without recourse, its
Commitments and Loans hereunder in accordance with the provisions
of subsection 12.7(c) to one or more Assignees (which need not be
existing Lenders hereunder, but which must be willing to execute
and deliver such amendment, supplement or modification)
identified to it by the Borrower.
(c) Notwithstanding the foregoing provisions of this
subsection 5.17, no Lender shall be required to assign all or any
portion of its Commitments and Loans pursuant to this Section
5.17 unless and until such Lender shall have received from such
Assignees one or more payments which, in an aggregate, are at
least equal to the aggregate outstanding principal amount of the
Loans owing to such Lender and all accrued interest and other
amounts owing on account thereof. Any assignment made pursuant
to this subsection 5.17 shall constitute a prepayment for
purposes of, and shall be subject to the provisions of,
subsection 5.15.
SECTION 6. REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Agreement and
to make the Loans and issue or participate in the Letters of
Credit the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that:
6.1 Financial Condition. The consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at
December 31, 1995 and the related consolidated statements of
income and of cash flows for the fiscal year ended on such date,
reported on by Ernst & Young, copies of which have heretofore
been furnished to each Lender, are complete and correct and
present fairly in all material respects the consolidated
financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of
their operations and their consolidated cash flows for the fiscal
year then ended. The unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at June 30, 1996
and the related unaudited consolidated statements of income and
of cash flows for the six-month period ended on such date,
certified by a Responsible Officer, copies of which have
heretofore been furnished to each Lender, are complete and
correct and present fairly in all material respects the
consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated
results of their operations and their consolidated cash flows for
the six-month period then ended (subject to normal year-end audit
adjustments and the absence of footnotes). All such financial
statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by such
accountants or Responsible Officer, as the case may be, and as
disclosed therein). Neither the Borrower nor any of its
consolidated Subsidiaries had, at the date of the most recent
balance sheet referred to above, any material Guarantee
Obligation, contingent liability or liability for taxes, or any
long-term lease or unusual forward or long-term commitment,
including, without limitation, any interest rate or foreign
currency swap or exchange transaction, which is not reflected in
the foregoing statements or in the notes thereto. Except to the
extent permitted under this Agreement or separately disclosed to
the Lenders in writing prior to the date hereof, there has been
no sale, transfer or other disposition by the Borrower or any of
its consolidated Subsidiaries of any material part of its
business or property and no purchase or other acquisition of any
business or property (including any capital stock of any other
Person) material in relation to the consolidated financial
condition of the Borrower and its consolidated Subsidiaries at
December 31, 1995 during the period from December 31, 1995 to and
including the date hereof.
6.2 No Change. Since December 31, 1995, there has
been no development or event which has had or could reasonably be
expected to have a Material Adverse Effect.
6.3 Pro Forma Balance Sheet. The pro forma balance
sheet referenced in subsection 7.1(m), together with any notes
thereto, were prepared in good faith on the basis of the
assumptions stated therein, which assumptions were reasonable in
light of conditions existing at the time of delivery of pro forma
balance sheet. After giving effect to the Repurchase and the
transactions contemplated by this Agreement, the Borrower and its
Subsidiaries will have recorded assets and liabilities
substantially similar to the recorded assets and liabilities
contemplated for such date by such pro forma balance sheet
referenced in subsection 7.1(m).
6.4 Disclosure. (a) No information, schedule,
exhibit or report or other document furnished by the Borrower or
any of its Subsidiaries to the Administrative Agent or any Lender
in connection with the negotiation of this Agreement or any other
Loan Document (or pursuant to the terms hereof or thereof), as
such information, schedule, exhibit or report or other document
has been amended, supplemented or superseded by any other
information, schedule, exhibit or report or other document later
delivered to the same parties receiving such information,
schedule, exhibit or report or other document, contained any
material misstatement of fact or omitted to state a material fact
or any fact necessary to make the statements contained therein,
in light of the circumstances when made, not materially
misleading.
(b) The Offer to Purchase (as in effect on the Closing
Date) did not contain any material misstatement of fact or omit
to state a material fact or any fact necessary to make the
statements contained therein, in light of the circumstances when
made, not materially misleading.
6.5 Corporate Existence; Compliance with Law. Each of
the Borrower and its Subsidiaries (a) is duly organized, validly
existing and (in the case of the Borrower and its Material
Subsidiaries) in good standing under the laws of the jurisdiction
of its organization, (b) has the corporate power and authority,
and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in
which it is currently engaged, (c) in the case of the Borrower
and its Material Subsidiaries, is duly qualified as a foreign
corporation and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property
or the conduct of its business requires such qualification,
except to the extent that all failures to be so qualified could
not, in the aggregate, reasonably be expected to have a Material
Adverse Effect and (d) is in compliance with all Requirements of
Law except to the extent that all failures to comply therewith
could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
6.6 Corporate Power; Authorization; Enforceable
Obligations. The Borrower has the corporate power and authority,
and the legal right, to make, deliver and perform the Loan
Documents to which it is a party and to borrow hereunder and has
taken all necessary corporate action to authorize the borrowings
on the terms and conditions of this Agreement and any Notes and
to authorize the execution, delivery and performance of the Loan
Documents to which it is a party. No consent or authorization
of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in
connection with the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of the Loan
Documents to which the Borrower is a party. This Agreement has
been, and each other Loan Document to which it is a party will
be, duly executed and delivered on behalf of the Borrower. This
Agreement constitutes, and each other Loan Document to which it
is a party when executed and delivered will constitute, a legal,
valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with its terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
6.7 No Legal Bar. The execution, delivery and
performance of the Loan Documents to which the Borrower is a
party, the borrowings hereunder and the use of the proceeds
thereof will not violate any Requirement of Law or Contractual
Obligation of the Borrower or of any of its Subsidiaries and will
not result in, or require, the creation or imposition of any Lien
on any of its or their respective properties or revenues pursuant
to any such Requirement of Law or Contractual Obligation.
6.8 No Material Litigation. No litigation,
investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the
Borrower, threatened by or against the Borrower or any of its
Subsidiaries or against any of its or their respective properties
or revenues (a) with respect to any of the Loan Documents or any
of the transactions contemplated hereby or thereby, or (b) which
could reasonably be expected to have a Material Adverse Effect.
6.9 No Default. Neither the Borrower nor any of its
Subsidiaries is in default under or with respect to any of its
Contractual Obligations in any respect which could reasonably be
expected to have a Material Adverse Effect. No Default or Event
of Default has occurred and is continuing.
6.10 Ownership of Property; Liens. Each of the
Borrower and its Material Subsidiaries has good record and
marketable title in fee simple to, or a valid leasehold interest
in, all its real property, and good title to, or a valid
leasehold interest in, all its other property, and none of such
property is subject to any Lien except as permitted by subsection
9.3.
6.11 Intellectual Property. The Borrower and each of
its Subsidiaries owns, or is licensed to use, all trademarks,
tradenames, copyrights, technology, know-how and processes
necessary for the conduct of its business as currently conducted,
except for those the failure to own or license which could not
reasonably be expected to have a Material Adverse Effect (the
"Intellectual Property"). No claim has been asserted and is
pending by any Person challenging or questioning the use of any
such Intellectual Property or the validity or effectiveness of
any such Intellectual Property which, if accurate, could
reasonably be expected to have a Material Adverse Effect, nor
does the Borrower know of any valid basis for any such claim. To
the best knowledge of the Borrower, the use of such Intellectual
Property by the Borrower and its Subsidiaries does not infringe
on the rights of any Person, except for such claims and
infringements that, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
6.12 No Burdensome Restrictions. No Requirement of
Law applicable to the Borrower or any of its Subsidiaries could
reasonably be expected to have a Material Adverse Effect.
6.13 Taxes. Each of the Borrower and its Material
Subsidiaries has filed or caused to be filed all tax returns
which, to the knowledge of the Borrower, are required to be filed
and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it
or any of its property by any Governmental Authority (other than
any the amount or validity of which are currently being contested
in good faith by appropriate proceedings and with respect to
which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be);
no tax Lien has been filed, and, to the knowledge of the
Borrower, no claim is being asserted, with respect to any such
tax, fee or other charge.
6.14 Federal Regulations. No part of the proceeds of
any Loans will be used in any manner which would violate, or
result in the violation of, Regulation G or Regulation U of the
Board of Governors of the Federal Reserve System as now and from
time to time hereafter in effect. If requested by any Lender or
the Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form G-3 or FR
Form U-1 referred to in said Regulation G or Regulation U, as the
case may be.
6.15 ERISA. Neither a Reportable Event nor an
"accumulated funding deficiency" (within the meaning of
Section 412 of the Code or Section 302 of ERISA) has occurred
during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan,
and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code. No termination of a
Single Employer Plan has occurred, and no Lien in favor of the
PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did
not, as of the last annual valuation date prior to the date on
which this representation is made or deemed made, exceed the
value of the assets of such Plan allocable to such accrued
benefits. Neither the Borrower nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any
Multiemployer Plan, and neither the Borrower nor any Commonly
Controlled Entity would become subject to any liability under
ERISA if the Borrower or any such Commonly Controlled Entity were
to withdraw completely from all Multiemployer Plans as of the
valuation date most closely preceding the date on which this
representation is made or deemed made. No such Multiemployer
Plan is in Reorganization or Insolvent. The present value
(determined using actuarial and other assumptions which are
reasonable in respect of the benefits provided and the employees
participating) of the liability of the Borrower and each Commonly
Controlled Entity for post retirement benefits to be provided to
their current and former employees under Plans which are welfare
benefit plans (as defined in Section 3(1) of ERISA) does not, in
the aggregate, exceed the assets under all such Plans allocable
to such benefits by an amount in excess of $10,000,000.
6.16 Investment Company Act; Other Regulations. The
Borrower is not an "investment company", or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended. The Borrower is
not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board of Governors of
the Federal Reserve System) which limits its ability to incur
Indebtedness.
6.17 Subsidiaries. Schedule III hereto sets forth all
of the Subsidiaries of the Borrower at the date hereof.
6.18 Environmental Matters. (a) The facilities and
properties owned, leased or operated by the Borrower, any of its
Material Subsidiaries or any of its first-tier Foreign
Subsidiaries (the "Properties") do not contain, and have not
previously contained, any Materials of Environmental Concern in
amounts or concentrations which (i) constitute or constituted a
violation of, or (ii) could reasonably be expected to give rise
to liability under, any Environmental Law, except in either case
insofar as such violation or liability, or any aggregation
thereof, is not reasonably likely to result in the payment of a
Material Environmental Amount.
(b) The Properties and all operations at the
Properties are in compliance, and have in the last 3 years been
in compliance, in all material respects with all applicable
Environmental Laws, and there is no contamination at or under
(or, to the knowledge of the Borrower, about) the Properties or
violation of any Environmental Law with respect to the Properties
or the business operated by the Borrower, any of its Material
Subsidiaries or any of its first-tier Foreign Subsidiaries (the
"Business"), except insofar as such violation or failure to be in
compliance or contamination, or any aggregation thereof, is not
reasonably likely to result in the payment of a Material
Environmental Amount.
(c) Neither the Borrower nor any of its Subsidiaries
has received any notice of violation, alleged violation, non-
compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the Business, nor does the
Borrower have knowledge or reason to believe that any such notice
will be received or is being threatened, except insofar as such
notice or threatened notice, or any aggregation thereof, does not
involve a matter or matters that is or are reasonably likely to
result in the payment of a Material Environmental Amount.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties in violation of,
or in a manner or to a location which could reasonably be
expected to give rise to liability under, any Environmental Law,
nor have any Materials of Environmental Concern been generated,
treated, stored or disposed of at, on or under any of the
Properties in violation of, or in a manner that could reasonably
be expected to give rise to liability under, any applicable
Environmental Law, except insofar as any such violation or
liability referred to in this paragraph, or any aggregation
thereof, is not reasonably likely to result in the payment of a
Material Environmental Amount.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Borrower, threatened, under any Environmental Law to which the
Borrower, any of its Material Subsidiaries or any of its first-
tier Foreign Subsidiaries is or will be named as a party with
respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative
orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect
to the Properties or the Business, except insofar as such
proceeding, action, decree, order or other requirement, or any
aggregation thereof, is not reasonably likely to result in the
payment of a Material Environmental Amount.
(f) There has been no release or threat of release of
Materials of Environmental Concern at or from the Properties, or
arising from or related to the operations of the Borrower or any
Subsidiary in connection with the Properties or otherwise in
connection with the Business, in violation of or in amounts or in
a manner that could reasonably give rise to liability under
Environmental Laws, except insofar as any such violation or
liability referred to in this paragraph, or any aggregation
thereof, is not reasonably likely to result in the payment of a
Material Environmental Amount.
6.19 Pledge Agreements. (a) Each Pledge Agreement
constitutes a legal, valid and binding obligation of the Loan
Party who is party thereto, enforceable against it in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and
by general equitable principles.
(b) Upon delivery to the Administrative Agent of the
stock certificates evidencing the Pledged Stock of which the
issuer is a corporation organized under the laws of any
jurisdiction within the United States, the security interests
granted pursuant to the Pledge Agreements will constitute a
valid, perfected first priority security interest on such Pledged
Stock (subject to the terms of the Collateral Agency Agreement),
enforceable as such against all creditors of the respective
Pledgor and any Persons purporting to purchase any such Pledged
Stock from the respective Pledgor.
(c) Except as set forth in the legal opinions provided
to the Administrative Agent by counsel in the relevant
jurisdictions pursuant to subsection 7.1(f)(iv) or 8.10, the
security interests in the capital stock or other equity interests
of each Foreign Subsidiary granted pursuant to the Pledge
Agreements will constitute a valid, perfected first priority
security interest on such Pledged Stock (to the extent applicable
under the relevant local laws or otherwise reasonably acceptable
to the Agents, but subject to the terms of the Collateral Agency
Agreement), enforceable as such against all creditors of the
respective Pledgor and any Persons purporting to purchase any
such Pledged Stock from the respective Pledgor.
6.20 Security Agreements. (a) Each Security
Agreement constitutes a legal, valid and binding obligation of
the grantor party thereto, enforceable against it in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and
by general equitable principles.
(b) Upon filing by the Administrative Agent of (i) the
financing statements listed on Schedule IV hereto (and, after the
Closing Date, any additional filings required to be made pursuant
to the Credit Documents) and (ii) any filings required with the
United States Patent and Trademark Office, the security interests
granted pursuant to the Security Agreements will constitute a
valid, perfected first priority security interest on the
Collateral (as defined therein) (subject to the terms of the
Collateral Agency Agreement), enforceable as such against all
creditors of any grantor and any Persons purporting to purchase
any such Collateral from the Loan Party who is the grantor with
respect thereto (except purchasers of Inventory in the ordinary
course of business).
6.21 Guarantees. The provisions of each Guarantee are
effective to create a legal, valid, binding and enforceable
guarantee of the obligations described therein, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by general
equitable principles.
6.22 Solvency. On the Closing Date (after giving
effect to the Repurchase and the borrowing and use of proceeds of
the Term Loans), the aggregate value of all of the assets of the
Borrower and its Subsidiaries on a consolidated basis, at a fair
valuation, exceeds the total liabilities of the Borrower and its
Subsidiaries on a consolidated basis (including contingent,
subordinated, unmatured and unliquidated liabilities). The
Borrower and its Subsidiaries have the ability to pay their
respective debts as they mature and do not have unreasonably
small capital with which to conduct their respective businesses.
For purposes of this subsection 6.22, the "fair valuation" of
such assets shall be determined on the basis of that amount which
may be realized within a reasonable time, in any manner through
realization of the value of or dispositions of such assets at the
regular market value, conceiving the latter as the amount which
could be obtained for the properties in question within such
period by a capable and diligent business person from an
interested buyer who is willing to purchase under ordinary
selling conditions.
SECTION 7. CONDITIONS PRECEDENT
7.1 Conditions to Initial Extensions of Credit. The
agreement of each Lender to make the initial extension of credit
requested to be made by it is subject to the satisfaction,
immediately prior to or concurrently with the making of such
extension of credit on the Closing Date, of the following
conditions precedent:
(a) Loan Documents. The Administrative Agent shall
have received (i) this Agreement, executed and delivered by
a duly authorized officer of the Borrower, (ii) each Stock
Pledge Agreement, executed and delivered by a duly
authorized officer of each party thereto, (iii) the
Subsidiaries Guarantee, executed and delivered by a duly
authorized officer of each party thereto, (iv) each Security
Agreement, executed and delivered by a duly authorized
officer of each party thereto, (v) each Patent Security
Agreement, executed and delivered by a duly authorized
officer of each party thereto, (vi) each Trademark Security
Agreement, executed and delivered by a duly authorized
officer of each party thereto and (vii) the Collateral
Agency Agreement, executed and delivered by each party
thereto.
(b) Indenture and Other Agreements. The
Administrative Agent shall have received true and correct
copies, certified as to authenticity by the Borrower, of the
Indenture, and such other documents or instruments as may be
reasonably requested by the Administrative Agent.
(c) Closing Certificate of Borrower. The
Administrative Agent shall have received a certificate of
the President or any Vice President and the Secretary or an
Assistant Secretary of the Borrower, dated the Closing Date,
(i) attaching the Charter and By-laws of the Borrower, (ii)
attaching the resolutions of the Board of Directors of the
Borrower with respect to the Repurchase and the transactions
contemplated hereby, (iii) certifying that the such
resolutions have not been amended, modified, revoked or
rescinded as of the date of such certificate and (iv)
certifying as to the incumbency and signature of the
officers of the Borrower executing any Loan Document; such
certificate (and the attachments thereto) shall be in form
and substance satisfactory to the Administrative Agent.
(d) Closing Certificate of Loan Parties. The
Administrative Agent shall have received a certificate of
the President or any Vice President and the Secretary or an
Assistant Secretary of each Loan Party (other than the
Borrower), dated the Closing Date, (i) attaching the
resolutions of the Board of Directors of such Loan Party
with respect to the transactions contemplated hereby to
which it is a party, (ii) certifying that the such
resolutions have not been amended, modified, revoked or
rescinded as of the date of such certificate and (iv)
certifying as to the incumbency and signature of the
officers of such Loan Party executing any Loan Document;
such certificate (and the attachments thereto) shall be
written in English (or be accompanied by a certified English
translation) and be in form and substance satisfactory to
the Administrative Agent.
(e) Fees. The Administrative Agent shall have
received, for the accounts of the Lenders and the
Administrative Agent, all accrued fees and expenses owing
hereunder or in connection herewith to the Administrative
Agent and the Lenders (including, without limitation,
accrued fees and disbursements of primary counsel to the
Administrative Agent), to the extent that such fees and
expenses have been presented for payment a reasonable time
prior to the Closing Date.
(f) Legal Opinions. The Administrative Agent shall
have received, with a counterpart for each Lender, the
following executed legal opinions:
(i) the executed legal opinion of Ropes &
▇▇▇▇, counsel to the Borrower and the other Loan
Parties, substantially in the form of Exhibit I-1;
(ii) the executed legal opinion of ▇▇▇▇▇ ▇▇▇▇▇▇,
Esq., General Counsel of the Borrower, substantially in
the form of Exhibit I-2;
(iii) the executed legal opinion of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Administrative
Agent, substantially in the form of Exhibit I-3; and
(iv) the executed legal opinion of such
international counsel as the Administrative Agent
reasonably may require, as special counsel to the
Borrower and the other Loan Parties, in form and
substance reasonably satisfactory to the Administrative
Agent.
Each such legal opinion shall cover such other matters
incident to the transactions contemplated by this Agreement
as the Administrative Agent may reasonably require.
(g) Solvency Opinions. The Administrative Agent shall
have received the opinion of Houlihan, Lokey, ▇▇▇▇▇▇ & Zukin
with respect to the solvency of the Borrower (after giving
effect to the consummation of the Repurchase and the
borrowings to be effected hereunder on the Closing Date),
and such opinion shall be in form and substance reasonably
satisfactory to the Administrative Agent.
(h) Pledged Stock; Stock Powers. The Administrative
Agent shall have received the certificates representing the
shares pledged pursuant to each of the Stock Pledge
Agreements, together with an undated stock power for each
such certificate executed in blank by a duly authorized
officer of the pledgor thereof.
(i) Actions to Perfect Liens. The Administrative
Agent shall have received evidence in form and substance
reasonably satisfactory to it that all filings, recordings,
registrations and other actions, including, without
limitation, the filing of duly executed financing statements
on form UCC-1, necessary or, in the reasonable opinion of
the Administrative Agent, desirable to perfect the Liens
created by the Security Documents shall have been completed.
(j) Lien Searches. The Administrative Agent shall
have received the results of a recent search by a Person
reasonably satisfactory to the Administrative Agent, of the
Uniform Commercial Code, judgement and tax lien filings
which may have been filed with respect to personal property
of the Borrower, and the results of such search shall be
reasonably satisfactory to the Administrative Agent.
(k) Tender Offer Documents. The Administrative Agent
and each Lender shall have received complete and correct
copies of each of the material Tender Offer Documents and
all amendments thereto, waivers relating thereto and other
material side letters and agreements affecting the terms
thereof. None of the Tender Offer Documents will have been
amended, supplemented or otherwise modified (including
waivers) since the date hereof, except (a) amendments,
supplements and other modifications (including waivers) to
the Tender Offer Documents which (i) do not increase the
price paid for the Shares, (ii) do not affect the material
conditions to the Borrower's obligation to purchase the
Shares and (iii) would not reasonably be expected to have a
Material Adverse Effect or (b) as approved by the Majority
Banks. Each Tender Offer Document to which the Borrower or
any of its Subsidiaries is a party shall have been duly
executed and delivered by the Borrower or such Subsidiary,
as the case may be, and shall be in full force and effect.
(l) Consents. The Administrative Agent shall have
received true and correct copies (in each case, certified as
to authenticity on such date by a duly authorized officer of
the Borrower) of all documents and instruments necessary or
reasonably advisable under any Requirement of Law or by
Contractual Obligation of the Borrower or any of its
Subsidiaries, in connection with the Repurchase or the
execution, delivery, performance, validity and
enforceability of any Tender Offer Document, other than any
consents, authorizations and filings for which the failure
to make or obtain would not be reasonably likely to have a
Material Adverse Effect; such consents, authorizations and
filings shall be reasonably satisfactory in form and
substance to the Administrative Agent and shall be in full
force and effect; and all applicable waiting periods shall
have expired without any action being taken by any
Governmental Authority which restrains, prevents or imposes
materially adverse conditions upon consummation of the
Repurchase or the financing thereof. All such consents,
licenses and approvals shall be in full force and effect.
(m) Pro Forma Balance Sheet. The Administrative Agent
shall have received a pro forma balance sheet of the
Borrower and its Subsidiaries on a consolidated basis (which
pro forma balance sheet shall have been delivered to the
Administrative Agent and the Lenders at least 10 days prior
to the date hereof).
(n) Termination of Existing Credit Agreements. The
Administrative Agent shall have received evidence reasonably
satisfactory to it of (i) the termination by the Borrower of
the Loan Agreement, dated as of November 1, 1994 (as the
same has been amended, supplemented or otherwise modified
from time to time), among the Borrower, the banks named
therein and Credit Suisse, as Administrative Agent and
Arranger, (ii) the termination by the Borrower of the Credit
Agreement, dated as of November 1, 1994 (as the same has
been amended, supplemented or otherwise modified from time
to time), among the Borrower, the banks named therein and
Credit Suisse, as Administrative Agent and Arranger, and
(iii) the payment of all amounts which are then due and
payable thereunder.
7.2 Conditions to Each Extension of Credit. The
agreement of each Lender to make any extension of credit
requested to be made by it on any date (including, without
limitation, its initial extension of credit) is subject to the
satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrower and each
other Loan Party in or pursuant to the Loan Documents shall
be true and correct in all material respects on and as of
such date as if made on and as of such date.
(b) No Default. No Default or Event of Default shall
have occurred and be continuing on such date or after giving
effect to the extensions of credit requested to be made on
such date.
Each borrowing by, and Letter of Credit issued on behalf of, the
Borrower hereunder shall constitute a representation and warranty
by the Borrower as of the date thereof that the conditions
contained in this subsection 7.2 have been satisfied.
SECTION 8. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the
Commitments remain in effect or any amount is owing to any Lender
or the Administrative Agent hereunder or under any other Loan
Document, the Borrower shall and (except in the case of delivery
of financial information, reports and notices) shall cause each
of its Subsidiaries to:
8.1 Financial Statements. Furnish to each Lender and
the Administrative Agent:
(a) as soon as available, but in any event within
90 days after the end of each fiscal year of the Borrower, a
copy of the consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at the end of such year and
the related consolidated statements of income and retained
earnings and of cash flows for such year, setting forth in
each case in comparative form the figures for the previous
year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of
the scope of the audit, by Ernst & Young or other
independent certified public accountants of nationally
recognized standing; and
(b) as soon as available, but in any event not later
than 45 days after the end of each of the first three
quarterly periods of each fiscal year of the Borrower, the
unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and
the related unaudited consolidated statements of income and
retained earnings and of cash flows of the Borrower and its
consolidated Subsidiaries for such quarter and the portion
of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer as being
fairly stated in all material respects (subject to normal
year-end audit adjustments);
all such financial statements shall be complete and correct in
all material respects and shall be prepared in reasonable detail
and in accordance with GAAP applied consistently throughout the
periods reflected therein and with prior periods (except as
approved by such accountants or officer, as the case may be, and
disclosed therein).
8.2 Certificates; Other Information. Furnish to each
Lender and the Administrative Agent:
(a) concurrently with the delivery of the financial
statements referred to in subsection 8.1(a), a certificate
of the independent certified public accountants reporting on
such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of
any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial
statements referred to in subsections 8.1(a) and (b), a
certificate of a Responsible Officer (i) stating that, to
the best of such Officer's knowledge, during such period (A)
no Subsidiary has been formed or acquired (or, if any such
Subsidiary has been formed or acquired, the Borrower has
complied with the requirements of subsection 8.10 with
respect thereto), (B) neither the Borrower nor any of its
Subsidiaries has changed its name, its principal place of
business, its chief executive office or the location of any
material item of tangible Collateral without complying with
the requirements of this Agreement and the Security
Documents with respect thereto and (C) the Borrower has
observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in this
Agreement and the other Loan Documents to be observed,
performed or satisfied by it, and that such Officer has
obtained no knowledge of any Default or Event of Default
except as specified in such certificate, (ii) setting forth
the calculation of the Pricing Ratio (for purposes of
determining the Applicable Margin and Applicable Commitment
Fee) as of the last day of the fiscal quarter most recently
ended, (iii) setting forth the calculation of the amounts,
if any, which have been repatriated to the United States
during such period from Foreign Subsidiaries and which, as a
result of such repatriation, should be included in the
calculation of Excess Cash Flow and/or Net Proceeds pursuant
to the definitions of such terms in subsection 1.1 and (iv)
setting forth the computations used by the Borrower in
determining (as of the end of such fiscal period) compliance
with the covenants contained in subsection 9.1; provided
that (x) the certifications specified in clauses (i)(A) and
(i)(B) above shall not be required following the date upon
which the Borrower first obtains an Investment Grade Rating
and (y) the certifications specified in clause (iii) above
shall not be required with respect to any fiscal period
during which the Borrower has, on each day thereof,
maintained an Investment Grade Rating;
(c) not later than 45 days after the end of each
fiscal year of the Borrower, a copy of the projections by
the Borrower of the operating budget and cash flow budget of
the Borrower and its Subsidiaries for the succeeding fiscal
year, such projections to be accompanied by a certificate of
a Responsible Officer to the effect that such projections
have been prepared on the basis of sound financial planning
practice and that such Officer has no reason to believe they
are incorrect or misleading in any material respect;
provided that the provisions of this clause (c) shall not
apply for any year with respect to which the Borrower is
maintaining an Investment Grade Rating on the date that such
projections are due;
(d) within five days after the same are sent, copies
of all financial statements and reports which the Borrower
sends to its stockholders, and within five days after the
same are filed, copies of all financial statements and
reports which the Borrower may make to, or file with, the
Securities and Exchange Commission or any successor or
analogous Governmental Authority;
(e) not later than five Business Days after the end of
each calendar month, a certificate of a Responsible Officer
of the Borrower setting forth the amount, beneficiary and
Issuing Bank with respect to each Special Letter of Credit
which was outstanding as of the last day of such calendar
month; and
(f) promptly, such additional financial and other
information as any Lender may from time to time reasonably
request.
8.3 Payment of Obligations. Pay, discharge or
otherwise satisfy at or before maturity in accordance with
customary terms or before they become delinquent, as the case may
be, all of its material obligations of whatever nature, except
where the amount or validity thereof is currently being contested
in good faith by appropriate proceedings and reserves in
conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may
be.
8.4 Conduct of Business and Maintenance of Existence.
Continue to engage in business of the same general type as now
conducted by it and preserve, renew and keep in full force and
effect its corporate existence and take all reasonable action to
maintain all rights, privileges and franchises necessary or (in
the reasonable judgment of the Borrower) desirable in the normal
conduct of its business except as otherwise permitted pursuant to
subsection 9.5; comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply
therewith could not, in the aggregate, be reasonably expected to
have a Material Adverse Effect.
8.5 Maintenance of Property; Insurance. Keep all
property useful and necessary in its business in good working
order and condition; maintain with financially sound and
reputable insurance companies insurance on all its material
property (including, in any event, all material Collateral) in at
least such amounts and against at least such risks as are usually
insured against in the same general area by companies engaged in
the same or a similar business; and furnish to each Lender, upon
written request, full information as to the insurance carried.
8.6 Inspection of Property; Books and Records;
Discussions. Keep proper books of records and account in which
full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and
transactions in relation to its business and activities; and
permit representatives of any Lender to visit and inspect any of
its properties and examine and make abstracts from any of its
books and records at any reasonable time (upon reasonable advance
notice, when no Default or Event of Default has occurred and is
continuing) and as often as may reasonably be desired and to
discuss the business, operations, properties and financial and
other condition of the Borrower and its Subsidiaries with
officers and employees of the Borrower and its Subsidiaries and
with its independent certified public accountants.
8.7 Notices. Promptly give notice to the
Administrative Agent (which shall give prompt notice thereof to
the Lenders) of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any
Contractual Obligation of the Borrower or any of its
Subsidiaries or (ii) litigation, investigation or proceeding
which may exist at any time between the Borrower or any of
its Subsidiaries and any Governmental Authority, which in
either case, if not cured or if adversely determined, as the
case may be, could reasonably be expected to have a Material
Adverse Effect;
(c) any litigation or proceeding affecting the
Borrower or any of its Subsidiaries in which the amount
involved is $10,000,000 or more and not covered by insurance
or in which injunctive or similar relief is sought which
could have a Material Adverse Effect;
(d) the following events, as soon as possible and in
any event within 30 days after the Borrower knows or has
reason to know thereof: (i) the occurrence or expected
occurrence of any Reportable Event with respect to any Plan,
a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC or a Plan or any
withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the
institution of proceedings or the taking of any other action
by the PBGC or the Borrower or any Commonly Controlled
Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or
Insolvency of, any Plan;
(e) prior to the date upon which the Borrower first
obtains an Investment Grade Rating, the acquisition or
creation of any Domestic Subsidiary or any Foreign
Subsidiary which has Capital Stock that is directly owned by
the Borrower or any Domestic Subsidiary;
(f) any change in the Credit Rating of the Borrower
promptly upon the effectiveness thereof; and
(g) the occurrence of (i) any material adverse change
in the business, operations, property, condition (financial
or otherwise) or prospects of the Borrower and its
Subsidiaries taken as a whole or (ii) any development or
event which could reasonably be expected to have a material
adverse effect on the rights or remedies of the
Administrative Agent or the Lenders hereunder or under any
of the other Loan Documents.
Each notice pursuant to this subsection 8.7 shall be accompanied
by a statement of a Responsible Officer setting forth details of
the occurrence referred to therein and stating what action the
Borrower proposes to take with respect thereto.
8.8 Environmental Laws. (a) Comply with, and use
reasonable efforts to ensure compliance by all tenants and
subtenants, if any, with, all applicable Environmental Laws and
obtain and comply with and maintain, and use reasonable efforts
to ensure that all tenants and subtenants obtain and comply with
and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental
Laws, except to the extent that failure to do so could not be
reasonably expected to have a Material Adverse Effect.
(b) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all
material respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws, except to
the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings
could not be reasonably expected to have a Material Adverse
Effect.
8.9 Further Assurances. (a) Upon the request of the
Administrative Agent, promptly perform or cause to be performed
any and all acts and execute or cause to be executed any and all
documents (including, without limitation, financing statements
and continuation statements) for filing under the provisions of
the Uniform Commercial Code or any other Requirement of Law which
are necessary or reasonably advisable to maintain in favor of the
Administrative Agent, for the benefit of the Lenders, Liens on
the Collateral that are duly perfected in accordance with all
applicable Requirements of Law.
(b) Upon request of the Administrative Agent, promptly
provide such documents and legal opinions in respect of any
aspect or consequence of the transactions contemplated hereby as
the Administrative Agent shall reasonably request.
8.10 Additional Collateral. (a) With respect to any
assets (other than assets having a de minimis value) acquired
after the Closing Date by the Borrower or any of its Domestic
Subsidiaries that are intended to be subject to the Lien created
by any of the Security Documents but which are not so subject
(other than (y) any assets described in paragraph (b) or (c) of
this subsection 8.10 and (z) immaterial assets a Lien on which
cannot be perfected by filing UCC-1 financing statements),
promptly (and in any event within 30 days after the acquisition
thereof): (i) execute and deliver to the Administrative Agent
such amendments to the relevant Security Documents or such other
documents as the Administrative Agent shall deem necessary or
reasonably advisable to grant to the Administrative Agent, for
the benefit of the Lenders, a Lien on such assets, (ii) take all
actions necessary or advisable to cause such Lien to be duly
perfected in accordance with all applicable Requirements of Law,
including, without limitation, the filing of financing statements
in such jurisdictions as may be requested by the Administrative
Agent, and (iii) if reasonably requested by the Administrative
Agent, deliver to the Administrative Agent legal opinions
relating to the matters described in clauses (i) and (ii)
immediately preceding, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
(b) With respect to any Person that, subsequent to the
Closing Date, becomes a Subsidiary (other than a Foreign
Subsidiary and the ▇▇▇▇ ▇▇▇▇▇▇ Subsidiary), promptly (i) cause
such new Subsidiary to become a party to a Subsidiaries Guarantee
pursuant to documentation which is in form and substance
satisfactory to the Administrative Agent and (ii) if so requested
by the Administrative Agent, deliver to the Administrative Agent
legal opinions relating to due authorization, execution, delivery
of such Subsidiaries Guarantee by such new Subsidiary and the
enforceability against it of such Subsidiaries Guarantee, which
opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.
(c) With respect to any Person that, subsequent to the
Closing Date, becomes a Material Subsidiary (other than a Foreign
Subsidiary and the ▇▇▇▇ ▇▇▇▇▇▇ Subsidiary), promptly upon the
request of the Administrative Agent: (i) execute and deliver to
the Administrative Agent, for the benefit of the Lenders, a new
pledge agreement or such amendments to the relevant Pledge
Agreement as the Administrative Agent shall deem necessary or
reasonably advisable to grant to the Administrative Agent, for
the benefit of the Lenders, a Lien on the Capital Stock of such
Material Subsidiary which is owned by the Borrower or any of its
Subsidiaries, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with
undated stock powers executed and delivered in blank by a duly
authorized officer of the Borrower or such Material Subsidiary,
as the case may be, (iii) cause such new Material Subsidiary to
take all actions necessary or advisable to cause the Lien created
by the relevant Subsidiary Security Agreement to be duly
perfected in accordance with all applicable Requirements of Law,
including, without limitation, the filing of financing statements
in such jurisdictions as may be requested by the Administrative
Agent and (iv) if requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the
matters described in clauses (i), (ii) and (iii) immediately
preceding, which opinions shall be in form and substance, and
from counsel, reasonably satisfactory to the Administrative
Agent.
(d) With respect to any Person that, subsequent to the
Closing Date, becomes a Foreign Subsidiary which has either (x)
assets having a fair market value (as reasonably estimated by the
Borrower) or book value in excess of $10,000,000 in the aggregate
or (y) revenues in excess of $10,000,000 per annum, promptly upon
the request of the Administrative Agent: (i) execute and deliver
to the Administrative Agent a new pledge agreement or such
amendments to the relevant Pledge Agreement as the Administrative
Agent shall deem necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a Lien on
the Capital Stock of such Subsidiary which is owned by the
Borrower or any of its Domestic Subsidiaries (provided that in no
event shall more than 65% of the Capital Stock of any such
Foreign Subsidiary be required to be so pledged), (ii) deliver to
the Administrative Agent any certificates representing such
Capital Stock, together with undated stock powers executed and
delivered in blank by a duly authorized officer of the Borrower
or such Subsidiary, as the case may be, and take or cause to be
taken all such other actions under the law of the jurisdiction of
organization of such Foreign Subsidiary as may be necessary or
advisable to perfect such Lien on such Capital Stock and (iii) if
requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters
described in clauses (i) and (ii) immediately preceding, which
opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.
(e) Notwithstanding anything to the contrary contained
herein, the provisions of this subsection 8.10 shall not apply
after the date upon which the Borrower first obtains an
Investment Grade Rating.
8.11 Interest Rate Hedging. Within 180 days following
the Closing Date, the Borrower shall obtain interest rate
protection on not less than 50% of its then-outstanding long-term
floating rate Indebtedness upon terms, and subject to conditions,
reasonably satisfactory to the Administrative Agent.
SECTION 9. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the
Commitments remain in effect or any amount is owing to any Lender
or the Administrative Agent hereunder or under any other Loan
Document, the Borrower shall not, and (except with respect to
subsection 9.1) shall not permit any of its Subsidiaries to,
directly or indirectly:
9.1 Financial Condition Covenants. (a) During such
time as the Borrower is not maintaining an Investment Grade
Rating as of the last day of the period for which compliance with
the relevant covenant is calculated:
(i) Indebtedness to EBITDA. Permit, at any date
occurring during any "Test Period" set forth below, the
Pricing Ratio on such date to be greater than the ratio set
forth opposite such period below:
Test Period Ratio
Closing Date - 03/31/97 4.25 to 1.00
04/01/97 - 06/30/97 4.00 to 1.00
07/01/97 - 09/30/97 3.75 to 1.00
10/01/97 - 12/30/97 3.50 to 1.00
12/31/97 - 03/31/98 3.40 to 1.00
04/01/98 - 06/30/98 3.25 to 1.00
07/01/98 - 09/30/98 3.00 to 1.00
10/01/98 - 12/30/98 2.75 to 1.00
12/31/98 - 03/31/99 2.50 to 1.00
04/01/99 - 06/30/99 2.25 to 1.00
07/01/99 - thereafter 2.00 to 1.00
(ii) Interest Coverage. Permit, for any period of
four consecutive fiscal quarters ending during any "Test
Period" set forth below, the ratio of (i) EBITDA for such
period to (ii) the amount of interest expense of the
Borrower and its Subsidiaries, determined on a consolidated
basis in accordance with GAAP, for such period on the
aggregate principal amount of their consolidated
Indebtedness, to be less than the ratio set forth opposite
such period below:
Test Period Ratio
Closing Date - 03/31/97 3.00 to 1.00
04/01/97 - 06/30/97 3.15 to 1.00
07/01/97 - 03/31/98 3.25 to 1.00
04/01/98 - 06/30/98 3.50 to 1.00
07/01/98 - 09/30/98 3.75 to 1.00
10/01/98 - 12/30/98 4.00 to 1.00
12/31/98 - 03/31/99 4.25 to 1.00
04/01/99 - 06/30/99 4.50 to 1.00
07/01/99 - 09/30/99 4.75 to 1.00
10/01/99 - thereafter 5.00 to 1.00
; provided, however, that, during the period prior to
September 30, 1997, such interest expense shall be
determined on a pro forma basis, as if (x) the Repurchase
(including, without limitation, the borrowings hereunder
utilized to finance the Repurchase) had been consummated on
January 1, 1996 and (y) prior to September 30, 1996, the
interest rate in effect with respect to the Loans hereunder
on each day of each fiscal quarter during that period had
been the weighted average of the interest rates in effect
for such Loans on the last day of such fiscal quarter.
(iii) Fixed Charge Coverage. Permit, for any period
of four consecutive fiscal quarters ending during any "Test
Period" set forth below, the ratio of (i) the amount equal
to EBITDA for such period minus the sum of cash capital
expenditures for such period and taxes paid in cash during
such period to (ii) Consolidated Fixed Charges for such
period, to be less than the ratio set forth opposite such
period below:
Test Period Ratio
12/31/96 - 12/31/97 1.00 to 1.00
01/1/98 - thereafter 1.10 to 1.00
; provided, however, that, during the period prior to
September 30, 1997, such Consolidated Fixed Charges shall be
determined on a pro forma basis, as if (x) the Repurchase
(including, without limitation, the borrowings hereunder
utilized to finance the Repurchase) had been consummated on
January 1, 1996 and (y) prior to September 30, 1996, the
interest rate in effect with respect to the Loans hereunder
on each day of each fiscal quarter during that period had
been the weighted average of the interest rates in effect
for such Loans on the last day of such fiscal quarter.
(b) During such time as the Borrower is maintaining an
Investment Grade Rating as of the last day of the period for
which compliance with the relevant covenant is calculated:
(i) Indebtedness to EBITDA. Permit the Pricing Ratio
on any date to be greater than the greater of (A) the
required ratio which would be in effect for such period if
the provisions of subsection 9.1(a)(i) were then applicable
and (B) 3.00 to 1.00.
(ii) Interest Coverage. Permit, for any period of
four consecutive fiscal quarters most recently ended, the
ratio of (i) EBITDA for such period to (ii) the amount of
interest expense, both expensed and capitalized, of the
Borrower and its Subsidiaries, determined on a consolidated
basis in accordance with GAAP, for such period on the
aggregate principal amount of their consolidated
Indebtedness, to be less than 3.00 to 1.00.
9.2 Limitation on Indebtedness and Preferred Stock.
Create, incur, assume or suffer to exist any Indebtedness or
preferred stock (other than preferred stock which, by its terms,
does not require the payment of any cash dividends thereon or
impose any cash penalties for the failure to declare cash
dividends thereon), except:
(a) Indebtedness of the Borrower under this Agreement;
(b) Indebtedness of the Borrower to any Subsidiary and
of any Subsidiary to the Borrower or any other Subsidiary;
(c) Indebtedness of the Borrower and any of its
Subsidiaries incurred to finance or refinance (i) the
acquisition and construction of a new headquarters park for
the Borrower, not to exceed $130,000,000 in the aggregate,
and (ii) the acquisition of other fixed or capital assets
(whether pursuant to a loan, a Financing Lease or otherwise)
in an aggregate principal amount not exceeding, as to the
Borrower and its Subsidiaries, $50,000,000 at any time
outstanding;
(d) short-term Indebtedness of Foreign Subsidiaries
incurred for working capital purposes, and standby letters
of credit (other than Standby Letters of Credit) issued for
the account of Foreign Subsidiaries, in an aggregate
principal amount not to exceed $150,000,000 at any time
outstanding;
(e) Indebtedness on account of commercial letters of
credit issued for the account of the Borrower and its
Subsidiaries in the ordinary course of business;
(f) Indebtedness outstanding on the date hereof and
listed on Schedule V and any refinancings, refundings,
renewals or extensions thereof in an amount not to exceed
the then current principal amount thereof;
(g) Indebtedness of a corporation which becomes a
Subsidiary after the date hereof, provided that (i) such
Indebtedness existed at the time such corporation became a
Subsidiary and was not created in anticipation thereof and
(ii) immediately after giving effect to the acquisition of
such corporation by the Borrower no Default or Event of
Default shall have occurred and be continuing;
(h) Indebtedness on account of commercial paper issued
by the Borrower; provided that the sum of the aggregate
outstanding principal amount of such commercial paper and
the Aggregate Outstanding Extensions of Credit shall at no
time exceed the aggregate amount of the Revolving Credit
Commitments then in effect;
(i) additional Indebtedness not exceeding $25,000,000
in aggregate principal amount at any one time outstanding;
(j) Guarantee Obligations permitted pursuant to
subsection 9.4; and
(k) additional Indebtedness the Net Proceeds of which
are applied in accordance with the provisions of subsection
5.5(b).
9.3 Limitation on Liens. Create, incur, assume or
suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, except for:
(a) Liens for taxes not yet due or which are being
contested in good faith by appropriate proceedings, provided
that adequate reserves with respect thereto are maintained
on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP (or, in the case of
Foreign Subsidiaries, generally accepted accounting
principles in effect from time to time in their respective
jurisdictions of incorporation);
(b) carriers', warehousemen's, mechanics',
materialmen's, repairmen's or other like Liens arising in
the ordinary course of business which are not overdue for a
period of more than 90 days or which are being contested in
good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social
security legislation and deposits securing liability to
insurance carriers under insurance or self-insurance
arrangements;
(d) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary
course of business;
(e) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not substantial in
amount and which do not in any case materially detract from
the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the
Borrower or such Subsidiary;
(f) Liens in existence on the date hereof listed on
Schedule VI, securing Indebtedness permitted by subsection
9.2(f), provided that no such Lien is spread to cover any
additional property after the date hereof and that the
amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness of the Borrower and
its Subsidiaries permitted by subsection 9.2(c) incurred to
finance or refinance the acquisition of fixed or capital
assets (including, without limitation, the new headquarters
park for the Borrower), provided that (i) such Liens shall
be created substantially simultaneously with the acquisition
of such fixed or capital assets (or, in the case of any
refinancing, secured the Indebtedness being refinanced) or
within 90 days following such acquisition, (ii) such Liens
do not at any time encumber any property other than the
property originally financed by such Indebtedness and (iii)
the amount of Indebtedness secured thereby is not increased;
(h) Liens on assets of any Foreign Subsidiary securing
(i) Indebtedness of such Foreign Subsidiary permitted by
subsection 9.2(d) or (ii) Guarantee Obligations permitted by
subsection 9.4(d) which support Indebtedness incurred in
reliance upon the provisions of subsection 9.2(d); provided
that the aggregate maximum amount of Indebtedness and
Guarantee Obligations which may be secured by Liens incurred
in reliance upon this subsection 9.3(h) shall be $25,000,000
at any one time outstanding;
(i) Liens securing Indebtedness permitted by
subsection 9.2(e) which encumber only the assets acquired or
shipped with the support of such commercial letter of
credit;
(j) Liens on the property or assets of a corporation
which becomes a Subsidiary after the date hereof securing
Indebtedness permitted by subsection 9.2(g), provided that
(i) such Liens existed at the time such corporation became a
Subsidiary and were not created in anticipation thereof,
(ii) any such Lien is not spread to cover any additional
property or assets of such corporation after the time such
corporation becomes a Subsidiary, and (iii) the amount of
Indebtedness secured thereby is not increased;
(k) Liens (not otherwise permitted hereunder) which
secure obligations not exceeding (as to the Borrower and all
Subsidiaries) $25,000,000 in aggregate amount at any time
outstanding; and
(l) Liens created pursuant to the Security Documents
(including, without limitation, Liens in favor of holders of
Securities outstanding on the date hereof under the
Indenture, to the extent contemplated by the Collateral
Agency Agreement).
9.4 Limitation on Guarantee Obligations. Create,
incur, assume or suffer to exist any Guarantee Obligation,
except:
(a) Guarantee Obligations in existence on the date
hereof and listed on Schedule VII;
(b) Guarantee Obligations incurred after the date
hereof in an aggregate amount not to exceed $50,000,000 at
any one time outstanding;
(c) guarantees made by the Borrower of obligations of
any of its Subsidiaries, which obligations are otherwise
permitted under this Agreement;
(d) guarantees made by Subsidiaries of the Borrower of
obligations of the Borrower or any of its other
Subsidiaries, which obligations are otherwise permitted
under this Agreement;
(e) reimbursement obligations on account of letters of
credit (including, without limitation, Letters of Credit)
otherwise permitted under this Agreement which are issued
for the account of the Borrower and its Subsidiaries; and
(f) the Guarantees.
9.5 Limitation on Fundamental Changes. Enter into any
merger, consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), or
convey, sell, lease, assign, transfer or otherwise dispose of,
all or substantially all of its property, business or assets,
except:
(a) any Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the
Borrower shall be the continuing or surviving corporation)
or with or into any one or more wholly owned Subsidiaries of
the Borrower (provided that the wholly owned Subsidiary or
Subsidiaries shall be the continuing or surviving
corporation);
(b) any wholly owned Subsidiary may sell, lease,
transfer or otherwise dispose of any or all of its assets
(upon voluntary liquidation or otherwise) to the Borrower or
any other wholly owned Subsidiary of the Borrower; and
(c) any Subsidiary of the Borrower may enter into any
transaction permitted by subsection 9.6 or 9.9.
9.6 Limitation on Sale of Assets. Convey, sell,
lease, assign, transfer or otherwise dispose of any of its
property, business or assets (including, without limitation,
receivables and leasehold interests), whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock to any Person
other than the Borrower or any wholly owned Subsidiary, except:
(a) the sale or other disposition of obsolete or worn
out property (including, without limitation, any property
which is no longer used or useful in the business of the
Borrower and its Subsidiaries) in the ordinary course of
business; provided that the Net Proceeds of each such
transaction are applied to the prepayment of the Loans as
provided in subsection 5.5;
(b) the sale or other disposition of any property,
provided that (other than inventory) the fair market value
of all assets so sold or disposed of in any period of twelve
consecutive months shall not exceed $10,000,000;
(c) the sale of inventory (including, without
limitation, "out-of-date" and "less than first quality"
inventory) in the ordinary course of business;
(d) the sale or discount without recourse of accounts
receivable arising in the ordinary course of business in
connection with the compromise or collection thereof;
(e) the sale or issuance to (i) ▇▇▇▇ ▇▇▇▇▇▇ (or any
entity controlled by him) of equity in the ▇▇▇▇ ▇▇▇▇▇▇
Subsidiary in connection with the consummation of the ▇▇▇▇
▇▇▇▇▇▇ Transaction and (ii) minority owners and joint
venture partners of equity of other Subsidiaries;
(f) the sale of assets pursuant to sale and leaseback
transactions otherwise permitted pursuant to this Agreement;
and
(g) the sale, transfer or other disposition of assets,
and the issuance of Capital Stock, the Net Proceeds of which
are applied in accordance with the provisions of subsection
5.5(b); provided that, in the event that the aggregate
consideration to be received by the Borrower and its
Subsidiaries on account of such sale, transfer, other
disposition or issuance is more than $100,000,000] in the
aggregate, at least 75% of such consideration shall be paid
in cash.
Notwithstanding the foregoing provisions of this subsection 9.6,
at all times prior to the date upon which the Borrower has
obtained an Investment Grade Rating, the trademark "Reebok" shall
be owned by Borrower, a Domestic Subsidiary or a Foreign
Subsidiary that is party to a Pledge Agreement.
9.7 Limitation on Dividends. Declare or pay any
dividend (other than dividends payable solely in common stock of
the Borrower) on, or make any payment on account of, or set apart
assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any
shares of any class of Capital Stock of the Borrower or any
warrants or options to purchase any such Stock, whether now or
hereafter outstanding, or make any other distribution in respect
thereof, either directly or indirectly, whether in cash or
property or in obligations of the Borrower or any Subsidiary
(such declarations, payments, setting apart, purchases,
redemptions, defeasances, retirements, acquisitions and
distributions being herein called "Restricted Payments"), except
that during such time as no Default or Event of Default has
occurred and is continuing or would result therefrom, the
Borrower may make Restricted Payments during any fiscal year (a)
in an aggregate amount not to exceed the Available Cash Flow
Amount and (b) in the amount (not to exceed $25,000,000 in the
aggregate) necessary to fulfill the Borrower's obligations under
"equity put options" which are outstanding on the date hereof.
Notwithstanding anything to the contrary contained in this
subsection 9.7, the provisions of this subsection 9.7 shall not
apply during such time as the Borrower is maintaining an
Investment Grade Rating and no Default or Event of Default has
occurred and is continuing (or would result therefrom).
9.8 Limitation on Capital Expenditures. Make or
commit to make (by way of the acquisition of securities of a
Person or otherwise) any expenditure in respect of the purchase
or other acquisition of fixed or capital assets (excluding any
such asset acquired in connection with normal replacement and
maintenance programs properly charged to current operations),
except for:
(a) expenditures in the ordinary course of business in
an aggregate amount not exceeding, for any fiscal year of
the Borrower, the amount equal to the sum of (i)
$100,000,000 and (ii) the Available Cash Flow Amount;
(b) expenditures in respect of the acquisition and
construction of a new headquarters park for the Borrower,
not to exceed $130,000,000 in the aggregate;
(c) expenditures made to repair or replace assets
which are damaged or destroyed, in an aggregate amount not
to exceed the amount (if any) of any proceeds of insurance
received on account of such damage or destruction; and
(d) expenditures on account of the making of any
investment permitted pursuant to subsection 9.9(g).
Notwithstanding anything to the contrary contained in this
subsection 9.8, the provisions of this subsection 9.8 shall not
apply during such time as the Borrower is maintaining an
Investment Grade Rating.
9.9 Limitation on Investments, Loans and Advances.
Make any advance, loan, extension of credit or capital
contribution to, or purchase any stock, bonds, notes, debentures
or other securities of or any assets constituting a business unit
of, or make any other investment in, any Person, except :
(a) extensions of trade credit in the ordinary course
of business;
(b) investments in Cash Equivalents;
(c) loans and advances to employees of the Borrower or
its Subsidiaries for travel, entertainment and relocation
expenses in the ordinary course of business;
(d) investments by the Borrower in, and loans by the
Borrower to, its Subsidiaries and investments by such
Subsidiaries in, and loans by Subsidiaries to, the Borrower
and other Subsidiaries;
(e) loans by the Borrower to its employees in an
aggregate amount not to exceed $10,000,000;
(f) investments in existence on the date hereof which
are described on Schedule IX hereof;
(g) during such time as no Default or Event or Default
has occurred and is continuing or would result therefrom,
investments, loans and advances to joint ventures, and
investments in Capital Stock or assets of other Persons, in
an aggregate amount not to exceed (i) $50,000,000 in any
fiscal year of the Borrower or (ii) $200,000,000 during the
period from the date hereof through the date of calculation;
and
(h) foreign exchange contracts of the Borrower and its
Subsidiaries entered into in the ordinary course of business
for the purpose of providing foreign exchange for their
respective operating requirements or of hedging currency
exposure (and not, in any event, for investment purposes)
and interest rate ▇▇▇▇▇▇ of the Borrower and its
Subsidiaries entered into in the ordinary course of business
for the purpose of hedging interest rate exposure on
floating rate Indebtedness.
9.10 Limitation on Optional Payments and Modifications
of Debt Instruments. (a) Make any optional payment or
prepayment on, or redemption or purchase of, any of the
Debentures or (b) amend, modify or change, or consent or agree to
any amendment, modification or change to any of the terms of the
Indenture in any manner which could be reasonably expected to be
adverse to the interests of the Lenders or the Administrative
Agent.
9.11 Limitation on Transactions with Affiliates.
Enter into any transaction, including, without limitation, any
purchase, sale, lease or exchange of property or the rendering of
any service, with any Affiliate unless such transaction is
(a) otherwise permitted under this Agreement, (b) in the ordinary
course of the Borrower's or such Subsidiary's business and
(c) upon fair and reasonable terms no less favorable to the
Borrower or such Subsidiary, as the case may be, than it would
obtain in a comparable arm's length transaction with a Person
which is not an Affiliate.
9.12 Limitation on Sales and Leasebacks. Enter into
any arrangement with any Person providing for the leasing by the
Borrower or any Subsidiary of real or personal property which has
been or is to be sold or transferred by the Borrower or any
Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of
such property or rental obligations of the Borrower or any
Subsidiary, other than (a) sales and leasebacks consummated among
the Borrower and its Subsidiaries, (b) any sale and leaseback of
the corporate headquarters of the Borrower and (c) other sales
and leasebacks resulting in annual lease expense to the Borrower
and its Subsidiaries of not more than $25,000,000 in any fiscal
year of the Borrower.
9.13 Limitation on Changes in Fiscal Year. Permit the
fiscal year of the Borrower to end on a day other than the
Saturday nearest to December 31.
9.14 Limitation on Negative Pledge Clauses. Enter
into with any Person any agreement, other than (a) this
Agreement, (b) the Indenture and (c) any industrial revenue
bonds, purchase money mortgages, Financing Leases and other
similar fixed asset financings permitted by this Agreement (in
which cases, any prohibition or limitation shall only be
effective against the assets financed thereby), which prohibits
or limits the ability of the Borrower or any of its Subsidiaries
to create, incur, assume or suffer to exist any Lien upon any of
its property, assets or revenues, whether now owned or hereafter
acquired.
9.15 Limitation on Lines of Business. Enter into any
business, either directly or through any Subsidiary, except for
(a) the design and marketing of sports, leisure and fitness
products and services, including footwear, apparel, accessories,
equipment and videos, (b) the design and marketing of footwear
and apparel for non-athletic use, (c) the businesses in which the
Borrower and its Subsidiaries are engaged on the date hereof and
businesses of a similar type and (d) other activities relating
thereto.
SECTION 10. EVENTS OF DEFAULT
If any of the following events shall occur and be
continuing:
(a) The Borrower shall fail to pay any principal of
any Loan or any Reimbursement Obligation when due in
accordance with the terms thereof or hereof; or the Borrower
shall fail to pay any interest on any Loan, or any other
amount payable hereunder, within five Business Days after
any such interest or other amount becomes due in accordance
with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made
by the Borrower or any other Loan Party herein or in any
other Loan Document or which is contained in any
certificate, document or financial or other statement
furnished by it at any time under or in connection with this
Agreement or any such other Loan Document shall prove to
have been incorrect in any material respect on or as of the
date made or deemed made; or
(c) The Borrower or any other Loan Party shall default
in the observance or performance of any agreement contained
in Section 9 or any negative covenant contained in any other
Loan Document; or
(d) The Borrower or any other Loan Party shall default
in the observance or performance of any other agreement
contained in this Agreement or any other Loan Document
(other than as provided in paragraphs (a) through (c) of
this Section 10), and such default shall continue unremedied
for a period of 30 days after the earlier of (i) the date
upon which an executive officer of the Borrower has actual
knowledge thereof and (ii) the date upon which the
Administrative Agent or any Lender gives notice to the
Borrower thereof; or
(e) The Borrower or any of its Subsidiaries shall
(i) default in any payment of principal of or interest of
any Indebtedness (other than the Loans) or in the payment of
any Guarantee Obligation, beyond the period of grace (not to
exceed 60 days), if any, provided in the instrument or
agreement under which such Indebtedness or Guarantee
Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to
any such Indebtedness or Guarantee Obligation or contained
in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or holders
of such Indebtedness or beneficiary or beneficiaries of such
Guarantee Obligation (or a trustee or Administrative Agent
on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice or the
passage of time if required, such Indebtedness to become due
prior to its stated maturity or such Guarantee Obligation to
become payable; provided, however, that no Default or Event
of Default shall exist under this paragraph unless the
aggregate amount of Indebtedness and/or Guarantee
Obligations in respect of which any default or other event
or condition referred to in this paragraph shall have
occurred shall be equal to at least $10,000,000; or
(f) (i) The Borrower or Material Subsidiary shall
commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or
foreign, relating to bankruptcy, insolvency, reorganization
or relief of debtors, seeking to have an order for relief
entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it
or its debts, or (B) seeking appointment of a receiver,
trustee, custodian, conservator or other similar official
for it or for all or any substantial part of its assets, or
the Borrower or any Material Subsidiary shall make a general
assignment for the benefit of its creditors; or (ii) there
shall be commenced against the Borrower or any Material
Subsidiary any case, proceeding or other action of a nature
referred to in clause (i) above which (A) results in the
entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or
unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any Material Subsidiary
any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets
which results in the entry of an order for any such relief
which shall not have been vacated, discharged, or stayed or
bonded pending appeal within 60 days from the entry thereof;
or (iv) the Borrower or any Material Subsidiary shall take
any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth
in clause (i), (ii), or (iii) above; or (v) the Borrower or
any Material Subsidiary shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay
its debts as they become due; or
(g) (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Code) involving any Plan, (ii) any
"accumulated funding deficiency" (as defined in Section 302
of ERISA), whether or not waived, shall exist with respect
to any Plan or any Lien in favor of the PBGC or a Plan shall
arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or
to terminate, any Single Employer Plan, which Reportable
Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required
Lenders, likely to result in the termination of such Plan
for purposes of Title IV of ERISA, (iv) any Single Employer
Plan shall terminate for purposes of Title IV of ERISA,
(v) the Borrower or any Commonly Controlled Entity shall, or
in the reasonable opinion of the Required Lenders is likely
to, incur any liability in connection with a withdrawal
from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (vi) any other adverse event or
condition shall occur or exist with respect to a Plan; and
in each case in clauses (i) through (vi) above, such event
or condition, together with all other such events or
conditions, if any, could reasonably be expected to involve
an aggregate amount of liability to the Borrower or any
Material Subsidiary in excess of $10,000,000; or
(h) One or more judgments or decrees shall be entered
against the Borrower or any Material Subsidiaries involving
in the aggregate a liability (not paid or fully covered by
insurance) of $10,000,000 or more, and all such judgments or
decrees shall not have been vacated, discharged, stayed or
bonded pending appeal within 60 days from the entry thereof;
or
(i) Prior to the date upon which the Borrower first
obtains an Investment Grade Rating, (i) any of the Security
Documents shall cease, for any reason, to be in full force
and effect, or the Borrower or any other Loan Party which is
a party to any of the Security Documents shall so assert,
(ii) the Lien created by any of the Security Documents shall
cease to be enforceable and of the same effect and priority
purported to be created thereby or (iii) any Guarantee shall
cease, for any reason, to be in full force and effect or any
Guarantor shall so assert; or
(j) (i) Any Person or "group" (within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended, but other than the Fireman Group) (A)
shall have acquired beneficial ownership of 20% or more of
any outstanding class of Capital Stock having ordinary
voting power in the election of directors of the Borrower or
(B) shall obtain the power (whether or not exercised) to
elect a majority of the Borrower's directors or (ii) the
Board of Directors of the Borrower shall not consist of a
majority of Continuing Directors; "Continuing Directors"
shall mean the directors of the Borrower on the date hereof
and each other director, if such other director's nomination
for election to the Board of Directors of the Borrower is
recommended by a majority of the then Continuing Directors;
then, and in any such event, (A) if such event is an Event of
Default specified in clause (i) or (ii) of paragraph (f) of this
Section 10 with respect to the Borrower, automatically the
Commitments shall immediately terminate and the Loans hereunder
(with accrued interest thereon) and all other amounts owing under
this Agreement (including, without limitation, all amounts of L/C
Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents
required thereunder) shall immediately become due and payable,
and (B) if such event is any other Event of Default, either or
both of the following actions may be taken: (i) with the consent
of the Required Lenders, the Administrative Agent may, or upon
the request of the Required Lenders, the Administrative Agent
shall, by notice to the Borrower declare the Commitments to be
terminated forthwith, whereupon the Commitments shall immediately
terminate; and (ii) with the consent of the Required Lenders, the
Administrative Agent may, or upon the request of the Required
Lenders, the Administrative Agent shall, by notice to the
Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement
(including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters
of Credit shall have presented the documents required thereunder)
to be due and payable forthwith, whereupon the same shall
immediately become due and payable. Except as expressly provided
above in this Section 10, presentment, demand, protest and all
other notices of any kind are hereby expressly waived.
With respect to all Letters of Credit with respect to
which presentment for honor shall not have occurred at the time
of an acceleration pursuant to the preceding paragraph, the
Borrower shall at such time deposit in a cash collateral account
opened by the Collateral Agent pursuant to the Borrower Security
Agreement (or, to the extent not prohibited by the Indenture,
opened by the Administrative Agent hereunder) an amount equal to
the aggregate then undrawn and unexpired amount of such Letters
of Credit. The Borrower hereby grants (as the case may be):
(x) to the Collateral Agent, for the benefit of the
holders of the Secured Obligations under (and as defined in)
the Collateral Agency Agreement, a security interest in such
cash collateral to secure the Secured Obligations (as
defined in the Collateral Agency Agreement). Amounts held
in such cash collateral account shall be applied by the
Collateral Agent in accordance with the provisions of
Section 2.2 of the Collateral Agency Agreement; or
(y) to the Administrative Agent, for the benefit of
the Issuing Banks and the L/C Participants, a security
interest in such cash collateral to secure all obligations
of under this Agreement and the other Loan Documents.
Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts
drawn under such Letters of Credit, and the unused portion
thereof after all such Letters of Credit shall have expired
or been fully drawn upon, if any, shall be applied to repay
other obligations of the Borrower hereunder and under the
Notes. After all such Letters of Credit shall have expired
or been fully drawn upon, all Reimbursement Obligations
shall have been satisfied and all other obligations of the
Borrower hereunder and under the Notes shall have been paid
in full, the balance, if any, in such cash collateral
account shall be returned to the Borrower.
The Borrower shall execute and deliver to the Collateral Agent or
the Administrative Agent, as the case may be, such further
documents and instruments as the Collateral Agent or the
Administrative Agent, as the case may be, may request to evidence
the creation and perfection of its security interest in such cash
collateral account.
SECTION 11. THE ADMINISTRATIVE AGENT
11.1 Appointment. (a) Each Lender hereby irrevocably
designates and appoints Credit Suisse as the Administrative Agent
of such Lender under this Agreement and the other Loan Documents,
and each such Lender irrevocably authorizes the Administrative
Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and
to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this
Agreement and the other Loan Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any
fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
(b) Notwithstanding anything to the contrary contained
in this Agreement, the parties hereto hereby agree that the Co-
Agents shall have no rights, duties, responsibilities or
liabilities in their respective capacities as such and that no
Co-Agent shall have the authority to take any action hereunder in
its capacity as such.
11.2 Delegation of Duties. The Administrative Agent
may execute any of its duties under this Agreement and the other
Loan Documents by or through Administrative Agents or
attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence
or misconduct of any Administrative Agents or attorneys in-fact
selected by it with reasonable care.
11.3 Exculpatory Provisions. Neither the
Administrative Agent nor any of its officers, directors,
employees, Administrative Agents, attorneys-in-fact or Affiliates
shall be (i) liable for any action lawfully taken or omitted to
be taken by it or such Person under or in connection with this
Agreement or any other Loan Document (except for its or such
Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other
document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement
or any other Loan Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or for any failure of the
Borrower to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower.
11.4 Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any Note, writing, resolution,
notice, consent, certificate, affidavit, letter, telecopy, telex
or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and
upon advice and statements of legal counsel (including, without
limitation, counsel to the Borrower), independent accountants and
other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as
the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed
with the Administrative Agent. The Administrative Agent shall be
fully justified in failing or refusing to take any action under
this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders as it
deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or
continuing to take any such action. The Administrative Agent
shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Required Lenders, and such
request and any action taken or failure to act pursuant thereto
shall be binding upon all the Lenders and all future holders of
the Loans.
11.5 Notice of Default. The Administrative Agent
shall not be deemed to have knowledge or notice of the occurrence
of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of
default". In the event that the Administrative Agent receives
such a notice, the Administrative Agent shall give notice thereof
to the Lenders. The Administrative Agent shall take such action
with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders; provided that unless
and until the Administrative Agent shall have received such
directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Lenders.
11.6 Non-Reliance on Administrative Agent and Other
Lenders. Each Lender expressly acknowledges that neither the
Administrative Agent nor any of its officers, directors,
employees, Administrative Agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act
by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower, shall be deemed to
constitute any representation or warranty by the Administrative
Agent to any Lender. Each Lender represents to the
Administrative Agent 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 appraisal of and investigation into the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and made its own decision to
make its Loans hereunder and enter into this Agreement. Each
Lender also represents 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 deem
appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make
such investigation as it deems necessary to inform itself as to
the business, operations, property, financial and other condition
and creditworthiness of the Borrower. Except for notices,
reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information
concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the
Borrower which may come into the possession of the Administrative
Agent or any of its officers, directors, employees,
Administrative Agents, attorneys-in-fact or Affiliates.
11.7 Indemnification. The Lenders agree to indemnify
the Administrative Agent in its capacity as such (to the extent
not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their
respective Commitment Percentages in effect on the date on which
indemnification is sought, from and against any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including, without limitation,
at any time following the payment of the Loans) be imposed on,
incurred by or asserted against the Administrative Agent in any
way relating to or arising out of, the Commitments, this
Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken
or omitted by the Administrative Agent under or in connection
with any of the foregoing; provided that no Lender shall be
liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements to the extent resulting
from the Administrative Agent's gross negligence or willful
misconduct. The agreements in this subsection 11.7 shall survive
the payment of the Loans and all other amounts payable hereunder.
11.8 Administrative Agent and Co-Agents in their
Individual Capacities. The Administrative Agent, each Co-Agent
and each of their respective Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with
the Borrower as though the Administrative Agent or such Co-Agent
(as the case may be) were not the Administrative Agent or a Co-
Agent (as the case may be) hereunder and under the other Loan
Documents. With respect to its Loans made or renewed by it and
any Note issued to it and with respect to any Letter of Credit
issued or participated in by it, the Administrative Agent and
each Co-Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may
exercise the same as though it were not the Administrative Agent
or a Co-Agent (as the case may be), and the terms "Lender" and
"Lenders" shall include the Administrative Agent and each Co-
Agent in its respective individual capacity.
11.9 Successor Administrative Agent. The
Administrative Agent may resign as Administrative Agent upon 10
days' notice to the Lenders. If the Administrative Agent shall
resign as Administrative Agent under this Agreement and the other
Loan Documents, then the Required Lenders shall appoint from
among the Lenders a successor Administrative Agent for the
Lenders, which successor Administrative Agent (provided that it
shall have been approved by the Borrower), shall succeed to the
rights, powers and duties of the Administrative Agent hereunder.
Effective upon such appointment and approval, the term
"Administrative Agent" shall mean such successor Administrative
Agent, and the former Administrative Agent's rights, powers and
duties as Administrative Agent shall be terminated, without any
other or further act or deed on the part of such former
Administrative Agent or any of the parties to this Agreement or
any holders of the Loans. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of
this Section 11 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative
Agent under this Agreement and the other Loan Documents.
SECTION 12. MISCELLANEOUS
12.1 Amendments and Waivers. Neither this Agreement
nor any other Loan Document, nor any terms hereof or thereof may
be amended, supplemented or modified except in accordance with
the provisions of this subsection 12.1. The Majority Lenders
may, or, with the written consent of the Majority Lenders, the
Administrative Agent may, from time to time, (a) enter into with
the Borrower written amendments, supplements or modifications
hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or
changing in any manner the rights of the Lenders or of the
Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Majority Lenders or the Administrative Agent,
as the case may be, may specify in such instrument, any of the
requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, supplement or
modification shall:
(i) reduce the amount or extend the scheduled date of
maturity of any Loan or of any installment thereof, or
reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment
thereof or increase the amount or extend the expiration date
of any Lender's Commitments, in each case without the
consent of each Lender directly affected thereby;
(ii) amend, modify or waive any provision of this
subsection 12.1 or reduce the percentage specified in the
definition of Required Lenders or Majority Lenders, or
consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement and the
other Loan Documents, in each case without the written
consent of all the Lenders;
(iii) lower the ratings specified in the definition of
Investment Grade Rating, or amend, modify or waive any
provision of subsection 12.2, or except as set forth in
subsection 12.2, take any action having the effect of
releasing any of the material collateral or material
guarantee obligations provided for in any Guarantee or
Security Document, in each case without the written consent
of the Required Lenders;
(iv) amend, modify or waive any provision of Section 4
without the written consent of each Issuing Bank directly
affected thereby; or
(v) amend, modify or waive any provision of Section 11
without the written consent of the then Administrative
Agent.
Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall
be binding upon the Borrower, the Lenders, the Administrative
Agent and all future holders of the Loans. In the case of any
waiver, the Borrower, the Lenders and the Administrative Agent
shall be restored to their former positions and rights hereunder
and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; no
such waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereon.
12.2 Releases of Collateral Security and Guarantee
Obligations. Notwithstanding anything to the contrary contained
herein or in any Security Document, upon request of the Borrower
the Administrative Agent shall (without any notice to or vote or
consent of any Lender) take action (or request that the
Collateral Agent take action) which has the effect of releasing:
(a) any collateral security and/or guarantee
obligations provided for in any Loan Document to the extent
necessary to permit the consummation of any Net Proceeds
Event or any asset dispositions permitted by subsection 9.6;
provided that (unless the Required Banks shall otherwise
consent) the Net Proceeds of any Net Proceeds Events are
applied in the manner contemplated by subsection 5.5 (if so
required); and
(b) to the extent that no Default or Event of Default
has occurred and is continuing, all collateral security
and/or guarantee obligations provided for in any Loan
Document promptly following the request of the Borrower made
at any time after the Borrower first obtains an Investment
Grade Rating.
12.3 Notices. All notices, requests and demands to or
upon the respective parties hereto to be effective shall be in
writing (including by facsimile transmission) and, unless
otherwise expressly provided herein, shall be deemed to have been
duly given or made (a) in the case of delivery by hand, when
delivered, (b) in the case of delivery by mail, three days after
being deposited in the mails, postage prepaid, or (c) in the case
of delivery by facsimile transmission, when sent and receipt has
been confirmed, addressed as follows in the case of the Borrower
and the Administrative Agent, and as set forth in Schedule I in
the case of the other parties hereto, or to such other address as
may be hereafter notified by the respective parties hereto:
The Borrower: Reebok International Ltd.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇, Treasurer
Fax: 617/▇▇▇-▇▇▇▇
with a copy to: Attention: General Counsel
Fax: 617/▇▇▇-▇▇▇▇
The Administrative Agent: Credit Suisse
Tower 49
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
provided that any notice, request or demand to or upon the
Administrative Agent or the Lenders pursuant to subsection 2.2,
3.2, 4.2, 5.3, 5.4, 5.6 or 5.11 shall not be effective until
received.
12.4 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of
any other right, remedy, power or privilege. The rights,
remedies, powers and privileges herein provided are cumulative
and not exclusive of any rights, remedies, powers and privileges
provided by law.
12.5 Survival of Representations and Warranties. All
representations and warranties made hereunder, in the other Loan
Documents and in any document, certificate or statement delivered
pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the making of the
Loans hereunder.
12.6 Payment of Expenses and Taxes. The Borrower
agrees (a) to pay or reimburse the Administrative Agent for all
of its reasonable out-of-pocket costs and expenses incurred in
connection with the development, preparation and execution of,
and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and
administration of the transactions contemplated hereby and
thereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, (b) to pay
or reimburse each Lender and the Administrative Agent for all its
costs and expenses incurred in connection with the enforcement or
preservation of any rights under this Agreement, the other Loan
Documents and any such other documents, including, without
limitation, the reasonable fees and disbursements of counsel to
each Lender and of counsel to the Administrative Agent, (c) to
pay, indemnify, and hold each Lender, each Co-Agent and the
Administrative Agent harmless from, any and all recording and
filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other
taxes, if any, which may be payable or determined to be payable
in connection with the execution and delivery of, or consummation
or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or
consent under or in respect of, this Agreement, the other Loan
Documents and any such other documents, and (d) to pay,
indemnify, and hold each Lender, each Co-Agent and the
Administrative Agent harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever with respect to any Letters of Credit or the
execution, delivery, enforcement, performance and administration
of this Agreement, the other Loan Documents, the Repurchase or
the use of the proceeds of the Loans and any such other
documents, including, without limitation, any of the foregoing
relating to the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of the
Borrower, any of its Subsidiaries or any of the Properties (all
the foregoing in this clause (d), collectively, the "indemnified
liabilities"), provided that the Borrower shall have no
obligation hereunder to the Administrative Agent, any Co-Agent or
any Lender with respect to indemnified liabilities to the extent
arising from the gross negligence or willful misconduct of the
Administrative Agent, such Co-Agent or such Lender. The
agreements in this subsection 12.6 shall survive repayment of the
Loans and all other amounts payable hereunder.
12.7 Successors and Assigns; Participations and
Assignments. (a) This Agreement shall be binding upon and inure
to the benefit of the Borrower, the Lenders, the Administrative
Agent and their respective successors and assigns, except that
the Borrower may not assign or transfer any of its rights or
obligations under this Agreement without the prior written
consent of each Lender.
(b) Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable
law, at any time sell to one or more banks or other financial
institutions ("Participants") participating interests in any Loan
owing to such Lender, any Commitment of such Lender or any other
interest of such Lender hereunder and under the other Loan
Documents; provided that any Lender which sells such
participating interests to a Participant which is not a
commercial bank, savings bank or finance company shall give
notice to the Borrower, identifying such Participant, promptly
following the consummation of such sale. In the event of any
such sale by a Lender of a participating interest to a
Participant, such Lender's obligations under this Agreement to
the other parties to this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance
thereof, such Lender shall remain the holder of any such Loan for
all purposes under this Agreement and the other Loan Documents,
and the Borrower and the Administrative Agent shall continue to
deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and the
other Loan Documents. No Lender shall be entitled to create in
favor of any Participant, in the participation agreement pursuant
to which such Participant's participating interest shall be
created or otherwise, any right to vote on, consent to or approve
any matter relating to this Agreement or any other Loan Document
except for those specified in clauses (i) and (ii) of the proviso
to subsection 12.1. The Borrower agrees that if amounts
outstanding under this Agreement are due or unpaid, or shall have
been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall, to the
maximum extent permitted by applicable law, be deemed to have the
right of setoff in respect of its participating interest in
amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as
a Lender under this Agreement, provided that, in purchasing such
participating interest, such Participant shall be deemed to have
agreed to share with the Lenders the proceeds thereof as provided
in subsection 12.8(a) as fully as if it were a Lender hereunder.
The Borrower also agrees that each Participant shall be entitled
to the benefits of subsections 5.13, 5.14 and 5.15 with respect
to its participation in the Commitments and the Loans outstanding
from time to time as if it was a Lender; provided that, in the
case of subsection 5.14, such Participant shall have complied
with the requirements of said subsection and provided, further,
that no Participant shall be entitled to receive any greater
amount pursuant to any such subsection than the transferor Lender
would have been entitled to receive in respect of the amount of
the participation transferred by such transferor Lender to such
Participant had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable
law, at any time and from time to time assign to any Lender or
any affiliate thereof or, with the consent of the Borrower and
the Administrative Agent (which in each case shall not be
unreasonably withheld), to an additional bank or financial
institution (an "Assignee") all or any part of its rights and
obligations under this Agreement and the other Loan Documents
pursuant to an Assignment and Acceptance, substantially in the
form of Exhibit J, executed by such Assignee, such assigning
Lender (and, in the case of an Assignee that is not then a Lender
or an affiliate thereof, by the Borrower and the Administrative
Agent) and delivered to the Administrative Agent for its
acceptance and recording in the Register, provided that, in the
case of any such assignment to an additional bank or financial
institution, (x) the sum of the aggregate principal amount of the
Term Loans (or, prior to the Closing Date, Term Loan Commitment)
and the aggregate amount of the Revolving Credit Commitment being
assigned are not less than $10,000,000 (or such lesser amount as
may be agreed to by the Borrower and the Administrative Agent)
and (y) if such assignment is of less than all of the rights and
obligations of the assigning Lender, the sum of the aggregate
principal amount of the Term Loans (or, prior to the Closing
Date, Term Loan Commitment) and the aggregate amount of the
Revolving Credit Commitment remaining with the assigning Lender
are not less than $10,000,000 (or such lesser amount as may be
agreed to by the Borrower and the Administrative Agent). Upon
such execution, delivery, acceptance and recording (and the
payment of the registration and processing fee described in
clause (e) below), from and after the effective date determined
pursuant to such Assignment and Acceptance, (x) the Assignee
thereunder shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder with a Commitment as set forth therein, and
(y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party
hereto). Notwithstanding any provision of this paragraph (c) and
paragraph (e) of this subsection, the consent of the Borrower
shall not be required for any assignment which occurs at any time
when any of the events described in Section 10(f) shall have
occurred and be continuing.
(d) The Administrative Agent, on behalf of the
Borrower, shall maintain at the address of the Administrative
Agent referred to in subsection 12.3 a copy of each Assignment
and Acceptance delivered to it and a register (the "Register")
for the recordation of the names and addresses of the Lenders and
the Commitments of, and principal amounts of the Loans owing to,
each Lender from time to time. The entries in the Register shall
be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may (and, in
the case of any Loan or other obligation hereunder not evidenced
by a Note, shall) treat each Person whose name is recorded in the
Register as the owner of a Loan or other obligation hereunder as
the owner thereof for all purposes of this Agreement and the
other Loan Documents, notwithstanding any notice to the contrary.
Any assignment of any Loan or other obligation hereunder not
evidenced by a Note shall be effective only upon appropriate
entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an Assignee (and, in the case
of an Assignee that is not then a Lender or an affiliate thereof,
by the Borrower and the Administrative Agent), together with
payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the
effective date determined pursuant thereto record the information
contained therein in the Register and give notice of such
acceptance and recordation to the Lenders and the Borrower;
provided that (x) no such fee shall be payable with respect to
any assignment from an assigning Lender to an affiliate thereof
and (y) such fee shall be payable by the Borrower with respect to
any assignment effected at the request of the Borrower pursuant
to subsection 5.17.
(f) The Borrower authorizes each Lender to disclose to
any Participant or Assignee (each, a "Transferee") and any
prospective Transferee any and all financial information in such
Lender's possession concerning the Borrower and its Affiliates
which has been delivered to such Lender by or on behalf of the
Borrower pursuant to this Agreement or which has been delivered
to such Lender by or on behalf of the Borrower in connection with
such Lender's credit evaluation of the Borrower and its
Affiliates prior to becoming a party to this Agreement.
(g) For avoidance of doubt, the parties to this
Agreement acknowledge that the provisions of this subsection 12.7
concerning assignments of Loans and Notes relate only to absolute
assignments and that such provisions do not prohibit assignments
creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law.
12.8 Adjustments; Set-off. (a) If any Lender (a
"benefitted Lender") at any time shall receive any payment of all
or part of its Term Loans, its Revolving Credit Loans or the
Reimbursement Obligations owing to it, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in subsection 10(f), or otherwise), in a
greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other
Lender's Term Loans, such Lender's Revolving Credit Loans or the
Reimbursement Obligations owing to it (as the case may be), or
interest thereon, such benefitted Lender shall purchase for cash
from the other Lenders such portion of each such other Lender's
Term Loan, such Lender's Revolving Credit Loans or the
Reimbursement Obligations owing to it (as the case may be), or
shall provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to
cause such benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the
Lenders; and if after taking into account such sharing the
benefitted Lender continues to have access to additional funds of
or collateral granted by the Borrower for application on account
of its debt, then the benefitted Lender shall use such funds or
collateral to reduce indebtedness of the Borrower held by it and
share such payments and the benefits of such collateral with the
other Lenders; provided, however, that if all or any portion of
such excess payment or benefits is thereafter recovered from such
benefitted Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such
recovery, but without interest. The Borrower agrees that each
Lender so purchasing a portion of another Lender's Loans or
Reimbursement Obligations may exercise all rights of payment
(including, without limitation, rights of set-off) with respect
to such portion as fully as if such Lender were the direct holder
of such portion.
(b) In addition to any rights and remedies of the
Lenders provided by law, each Lender shall have the right,
without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the
Borrower hereunder (whether at the stated maturity, by
acceleration or otherwise) to set-off and appropriate and apply
against such amount any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each
case whether direct or indirect, absolute or contingent, matured
or unmatured, at any time held or owing by such Lender or any
branch, agency or (to the extent permitted by applicable law)
banking affiliate thereof to or for the credit or the account of
the Borrower. Each Lender agrees promptly to notify the Borrower
and the Administrative Agent after any such set-off and
application made by such Lender, provided that the failure to
give such notice shall not affect the validity of such set-off
and application.
12.9 Judgment Currency. The obligations of the
Borrower in respect of any Reimbursement Obligation owing on
account of any Special Letters of Credit to the relevant Issuing
Bank hereunder shall, notwithstanding any judgment in a currency
(the "judgment currency") other than the currency in which such
Special Letter of Credit is denominated (the "denomination
currency"), be discharged only to the extent that on the Business
Day following receipt by such party of any sum adjudged to be so
due in the judgment currency such Issuing Bank may in accordance
with normal banking procedures purchase the denomination currency
with the judgment currency; if the amount of the denomination
currency so purchased is less than the sum originally due to such
Issuing Bank in the denomination currency, the Borrower agrees,
as a separate obligation and notwithstanding any such judgment,
to indemnify such Issuing Bank against such loss, and if the
amount of the denomination currency so purchased exceeds the sum
originally due to any party to this Agreement, such Issuing Bank
agrees to remit to the Borrower such excess.
12.10 Collateral Agency Agreement. Each Lender hereby
(a) authorizes and instructs the Administrative Agent to execute
and deliver the Collateral Agency Agreement and (b) acknowledges
and agrees that the Security Documents and the Collateral shall
be governed by the Collateral Agent. Each Lender hereby further
acknowledges and agrees that Fleet National Bank shall serve as
the Collateral Agent under (and as defined in) the Collateral
Agency Agreement.
12.11 Matters Relating to Certain Collateral. (a)
Each Lender hereby agrees that, notwithstanding anything to the
contrary contained in this Agreement or any Security Document,
the Pledge Agreements relating to capital stock of Foreign
Subsidiaries, the Patent Security Agreements and the Trademark
Security Agreements will not be delivered prior to or on the
Closing Date.
(b) Each Lender hereby waives compliance with the
provisions of Section 7 of this Agreement to the extent and only
to the extent necessary to permit the Closing Date to occur
without the delivery of such Security Documents (and the other
ancillary documentation relating thereto) and to permit the
Borrower to borrow under this Agreement. The Borrower hereby
covenants that (subject to the provisions of subsection 12.2) it
shall, and shall cause its Subsidiaries to, deliver to the
Administrative Agent all such Security Documents and related
documentation within 90 days following the Closing Date and that
the failure to deliver any such Security Document or related
documentation within such 90 day period shall constitute an Event
of Default hereunder; provided that, with the consent of the
Administrative Agent, such 90 day period may be extended by not
more than an additional 30 days. Notwithstanding the foregoing,
in the event that the Borrower shall satisfy the conditions set
forth in subsection 12.2 to the release of the Guarantees and
Security Documents during such period, the Borrower and its
Subsidiaries shall not be required to deliver such Security
Documents and related documentation.
12.12 Counterparts. This Agreement may be executed by
one or more of the parties to this Agreement on any number of
separate counterparts (including by facsimile transmission), and
all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of
this Agreement signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.
12.13 Confidentiality. (a) Each Lender hereby agrees
to maintain the confidentiality of all "Confidential Information"
and that it shall not disclose such "Confidential Information" to
third parties without the prior consent of the Borrower, other
than disclosure (i) on a confidential basis to directors,
officers, employees, legal counsel, accountants and other
professional advisors of such Lender, (ii) to other Lenders and
any Participant of such Lender, (iii) to regulatory officials
having jurisdiction over such Lender, (iv) as required by law or
legal process or in connection with any legal proceeding to which
such Lender is a party or is otherwise subject, (v) to any
Transferee or prospective Transferee of such Lender (provided
that such Transferee or prospective Transferee shall have agreed,
in writing, to be subject to the provisions of this subsection
12.13) or (vi) on a confidential basis to affiliates of such
Lender who reasonably could be expected to have a need to know
such information in connection with the administration by such
Lender of this Agreement and its extensions of credit hereunder.
(b) For purposes of this subsection 12.13, the term
"Confidential Information" shall mean all material, non-public
information which is received by such Lender from the Borrower or
any of its Subsidiaries and is conspicuously identified as being
"Confidential", other than (i) any such information which, at the
time of delivery or thereafter, becomes generally available to
the public other than as a result of a disclosure by such Lender,
(ii) any such information which was available to such Lender
prior to its disclosure to such Lender by the Borrower and its
Subsidiaries and (iii) any such information which becomes
available to such Lender from a source other than the Borrower
and its Subsidiaries (provided that such source is not known to
such Lender to be (x) bound by a confidentiality agreement with
the Borrower and its Subsidiaries or (y) otherwise prohibited
from transmitting the information to such Lender by a
contractual, legal or fiduciary obligation).
12.14 Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
12.15 Integration. This Agreement and the other Loan
Documents represent the agreement of the Borrower, the
Administrative Agent and the Lenders with respect to the subject
matter hereof, and there are no promises, undertakings,
representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth
or referred to herein or in the other Loan Documents.
12.16 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.
12.17 Submission To Jurisdiction; Waivers. The
Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Agreement and the
other Loan Documents to which it is a party, or for
recognition and enforcement of any judgement in respect
thereof, to the non-exclusive general jurisdiction of the
Courts of the State of New York, the courts of the
United States of America for the Southern District of
New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may
now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees
not to plead or claim the same;
(c) agrees that service of process in any such action
or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar
form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 12.3 or at such other
address of which the Administrative Agent shall have been
notified pursuant thereto;
(d) agrees that nothing herein shall affect the right
to effect service of process in any other manner permitted
by law or shall limit the right to ▇▇▇ in any other
jurisdiction; and
(e) waives, except in the case of extreme bad faith
(and otherwise to the maximum extent not prohibited by law),
any right it may have to claim or recover in any legal
action or proceeding referred to in this subsection 12.17
any special, exemplary, punitive or consequential damages.
12.18 Acknowledgements. The Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan
Documents;
(b) neither the Administrative Agent nor any Lender
has any fiduciary relationship with or duty to the Borrower
arising out of or in connection with this Agreement or any
of the other Loan Documents, and the relationship between
Administrative Agent and Lenders, on one hand, and the
Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other
Loan Documents or otherwise exists by virtue of the
transactions contemplated hereby among the Lenders or among
the Borrower and the Lenders.
12.19 WAIVERS OF JURY TRIAL. TO THE MAXIMUM EXTENT
PERMITTED BY APPLICABLE LAW, THE BORROWER, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the day and year first above
written.
REEBOK INTERNATIONAL LTD.
By:/s/ ▇▇▇ ▇▇▇▇▇▇▇
Title: Treasurer
CREDIT SUISSE,
as Administrative Agent
By:/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Associate
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Associate
CREDIT SUISSE, as a Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Member of Senior
Management
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Member of Senior
Management
ABN AMRO BANK N.V., as a Co-Agent
and as a Lender
By: ABN AMRO North America,
Inc.,
as its Agent
By:/s/ Brain ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
By:/s/ R.E. ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Group Vice President and
Director
CITIBANK, N.A., as a Co-Agent and
as a Lender
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
COMERICA BANK, as a Co-Agent and as
a Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE, as a Co-Agent
and as a Lender
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
Title: First Vice President
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH, as
a Co-Agent and as a Lender
By:▇▇▇▇▇▇ ▇▇▇
Title: Vice President
DRESDNER BANK AG, New York and
Grand Cayman Branches, as a
Co-Agent and a Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Treasurer
THE FIRST NATIONAL BANK OF BOSTON,
as a Co-Agent and as a Lender
By:/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO,
as a Co-Agent and as a Lender
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
FLEET NATIONAL BANK, as a Co-Agent
and as a Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
THE FUJI BANK, LIMITED, NEW YORK
BRANCH, as a Co-Agent and as a
Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President and
Manager
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as a Co-Agent and as a
Lender
By:/s/ Takuya Honjo
Title: Senior Vice President
ISTITUTO BANCARIO SAN PAOLO DI
TORINO S.p.A., as a Co-Agent and as
a Lender
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: First Vice President
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: First Vice President
▇▇▇▇▇▇ BANK LTD - NEW YORK BRANCH,
as a Co-Agent and as a Lender
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
THE MITSUBISHI TRUST AND BANKING
CORPORATION, as a Co-Agent and as a
Lender
By:/s/ Keifuke Nakajima
Title: Deputy General Manager
THE SANWA BANK, LIMITED, as a Co-
Agent and as a Lender
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director and
General Manager
WACHOVIA BANK OF GEORGIA, N.A., as
a Co-Agent and as a Lender
By:/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
BANCA COMMERCIALE ITALIANA, NEW
YORK BRANCH
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: First Vice President
By:/s/ ▇▇▇▇▇ ▇▇▇
Title: Assistant Vice President
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
BANK OF MONTREAL
By:/s/ ▇▇▇▇▇ ▇. Bank
Title: Director
THE BANK OF NEW YORK
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
THE BANK OF NOVA SCOTIA
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Authorized Signatory
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
BANQUE NATIONALE DE PARIS
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Assistant Vice President
BANQUE PARIBAS
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, III
Title: Vice President
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Group Vice President
BHF-BANK AKTIENGESELLSCHAFT
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
CAISSE NATIONALE DE CREDIT AGRICOLE
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇
Title: First Vice President
CIBC INC.
By:/s/ ▇▇▇▇ ▇. Lattiff
Title: Authorized Signatory
CORESTATES BANK, N.A.
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President and
Manager
CREDITANSTALT CORPORATE FINANCE,
INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
By:/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
THE DAI-ICHI KANGYO BANK, LIMITED,
New York Branch
By:/s/ ▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
FIRST UNION NATIONAL BANK OF NORTH
CAROLINA
By:▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
LLOYDS BANK PLC
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
LTCB TRUST COMPANY
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
NATIONSBANK, N.A.
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
THE NIPPON CREDIT BANK, LTD.
By:/s/ ▇▇▇▇▇ ▇▇▇▇
Title: Assistant Vice President
THE SAKURA BANK, LIMITED
By:/s/ Koi Suzuki
Title: Vice President and
Manager
SOCIETE GENERALE
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: First Vice President
STANDARD CHARTERED BANK
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
By:/s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Administrative Officer
STATE STREET BANK AND TRUST COMPANY
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
THE SUMITOMO BANK, LIMITED,
NEW YORK BRANCH
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Joint General Manager
THE TOKAI BANK, LIMTED
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Deputy General Manager
UNITED STATES NATIONAL BANK OF
OREGON
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
THE YASUDA TRUST AND BANKING CO.,
LTD.
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
FIRST AMENDMENT
FIRST AMENDMENT, dated as of August 23, 1996, to the
Credit Agreement, dated as of the date hereof (as amended,
supplemented or otherwise modified from time to time, the "Credit
Agreement"), among Reebok International Ltd. (the "Borrower"),
the several banks and other financial institutions from time to
time parties thereto (the "Lenders") and Credit Suisse, as
administrative agent (in such capacity, the "Administrative
Agent") for the Lenders.
W I T N E S S E T H:
WHEREAS, the Borrower is a party to the Credit
Agreement;
WHEREAS, the Borrower has requested that the
Administrative Agent and the Lenders agree to amend the Credit
Agreement in order to (a) permit certain Subsidiaries of the
Borrower to be account parties with respect to Special Letters of
Credit and (b) effect certain other modifications as more fully
described herein;
WHEREAS, the Administrative Agent and the Lenders are
willing to agree to such amendments only upon the terms and
subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein, the parties hereto hereby
agree as follows:
1. Defined Terms. Unless otherwise defined herein,
capitalized terms which are used herein shall have the meanings
assigned thereto in the Credit Agreement.
2. Amendment of Subsection 1.1. Subsection 1.1 of
the Credit Agreement hereby is amended by:
(a) deleting in its entirety the parenthetical contained in the
definition of "Available Cash Flow Amount" and inserting in
lieu thereof the following: "(but other than (i) that
arising for periods for which no payment is due under
subsection 5.5(c) because the Borrower was maintaining an
Investment Grade Rating on the relevant payment date and
(ii) amounts prepaid pursuant to subsection 5.3)";
(b) deleting in its entirety clause (e) of the definition of the
term "EBITDA" contained therein and by re-lettering clause
(f) of such definition as clause (e);
(c) deleting the word "Borrower" from clause (b) of the
definition of the term "Issuing Bank" contained therein and
by substituting therefor the phrase "relevant Approved
Account Party";
(d) deleting the word "Borrower" from the definition of the term
"Reimbursement Obligation" contained therein and by
substituting therefor the phrase "relevant Approved Account
Party";
(e) inserting in the definition of the term "Responsible
Officer" contained therein, immediately before the period at
the end of such definition, the phrase ", provided that the
Manager of treasury operations shall be a Responsible
Officer solely for purposes of signing Notices of
Borrowing";
(f) inserting in the definition of the term "Revolving Credit
Commitment" contained therein, immediately after the phrase
"issued on behalf of the Borrower" and immediately before
the phrase "hereunder in an aggregate principal and/or face
amount", the phrase "(or, in the case of any Special Letters
of Credit, the Approved Account Parties with respect
thereto)";
(g) inserting therein, in proper alphabetical order, the
following definitions:
"Approved Account Party": (a) with respect to any
Special Letter of Credit, the Borrower, Reebok International
Limited (a United Kingdom corporation), Reebok Trading (FAR
EAST) Limited or any other Subsidiary of the Borrower which
is approved by the Issuing Bank with respect to such Special
Letter of Credit as the account party with respect thereto
and (b) with respect to any other Letter of Credit, the
Borrower.
"Guaranteed L/C Obligations": all obligations and
liabilities of the Approved Account Parties to the Issuing
Bank (including, without limitation, interest accruing at
the then applicable rate provided herein after the filing of
any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding, relating to
any Approved Account Party whether or not a claim for post-
filing or post-petition interest is allowed in such
proceeding), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in
connection with, the Special Letters of Credit or any other
document made, delivered or given in connection therewith,
in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities (including,
without limitation, pursuant to the provisions of subsection
12.9), costs, expenses or otherwise.
3. Amendment of Subsection 2.3. Subsection 2.3 of the
Credit Agreement hereby is amended by deleting the amount set
forth opposite each date therein and by substituting therefor the
amount set forth opposite such date below:
Period Amount
March 31, 1997 $ 6,750,000
June 30, 1997 13,500,000
September 30, 1997 13,500,000
December 31, 1997 16,750,000
March 31, 1998 10,000,000
June 30, 1998 20,250,000
September 30, 1998 23,500,000
December 31, 1998 30,500,000
March 31, 1999 10,000,000
June 30, 1999 23,500,000
September 30, 1999 30,500,000
December 31, 1999 37,000,000
March 31, 2000 10,000,000
June 30, 2000 23,500,000
September 30, 2000 30,500,000
December 31, 2000 37,000,000
March 31, 2001 13,500,000
June 30, 2001 27,000,000
September 30, 2001 47,000,000
December 31, 2001 54,000,000
March 31, 2002 13,500,000
June 30, 2002 37,000,000
August 31, 2002 111,250,000
4. Amendment of Section 4. Section 4 of the Credit
Agreement hereby is amended by deleting said Section 4 in its
entirety and by substituting therefor the new Section 4 which is
attached hereto as Exhibit A.
5. Amendment of Subsection 5.13. Subsection 5.13 of
the Credit Agreement hereby is amended by:
(a) inserting in clause (a) thereof, immediately after the
phrase "in any such case, the Borrower" and immediately
before the phrase "shall promptly pay such Lender", the
phrase "(on its own behalf or on behalf of the relevant
Approved Account Party)"; and
(b) inserting in clause (b) thereof, immediately after the
phrase "then from time to time, the Borrower" and
immediately before the phrase "shall promptly pay to such
Lender", the phrase "(on its own behalf or on behalf of the
relevant Approved Account Party)".
6. Amendment of Subsection 6.19. Subsection 6.1 of
the Credit Agreement hereby is amended by deleting therefrom each
reference to the terms "Pledge Agreement" and "Pledge Agreements"
contained therein and by substituting for each such reference the
term "Stock Pledge Agreement" or "Stock Pledge Agreements",
respectively.
7. Amendment of Subsection 7.2. Subsection 7.2 of
the Credit Agreement hereby is amended by inserting therein,
immediately after the phrase "on behalf of, the Borrower" and
immediately before the phrase "hereunder shall constitute", the
phrase "or any Approved Account Party".
8. Amendment of Subsection 8.2(e). Subsection
8.2(e) of the Credit Agreement hereby is amended by inserting
thereto, immediately after the phrase "setting forth the" and
immediately before the phrase "amount, beneficiary and Issuing
Bank", the phrase "Approved Account Party,".
9. Amendment of Subsection 8.5. Subsection 8.5 of
the Credit Agreement hereby is amended by deleting said
subsection 8.5 in its entirety and by substituting therefor the
following:
8.5 Maintenance of Property; Insurance; Trademark
License. (a) Keep all property useful and necessary in its
business in good working order and condition; maintain with
financially sound and reputable insurance companies
insurance on all its material property (including, in any
event, all material Collateral) in at least such amounts and
against at least such risks as are usually insured against
in the same general area by companies engaged in the same or
a similar business; and furnish to each Lender, upon written
request, full information as to the insurance carried.
(b) Except to the extent otherwise permitted by
subsection 9.6, keep in full force and effect, and comply in
all material respects with, the terms of the License
Agreement, dated as of August 6, 1979, between the Borrower
(as successor to Reebok U.S.A. Limited, Inc.) and Reebok
International Limited, a United Kingdom corporation, as the
same may be amended, supplemented or otherwise modified in a
manner which could not reasonably be expected to have a
Material Adverse Effect.
10. Amendment of Subsection 8.10. Subsection 8.10 of
the Credit Agreement hereby is amended by deleting from clause
(c) and (d) thereof the phrase "Pledge Agreement" and by
substituting therefor the phrase "Stock Pledge Agreement".
11. Amendment of Subsection 9.1(a)(iii). Subsection
9.1(a)(iii) of the Credit Agreement hereby is amended by deleting
clause (i) thereof in its entirety and by substituting therefor
the following:
"(i) the amount equal to (A) the sum of EBITDA for such
period and the aggregate amount of fixed and contingent
rentals payable by the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with
GAAP, for such period with respect to leases of real
and personal property minus (B) the sum of cash capital
expenditures for such period and taxes paid in cash
during such period to"
12. Amendment of Subsection 9.6. Subsection 9.6 of
the Credit Agreement hereby is amended by deleting the last
sentence thereof in its entirety and by substituting therefor the
following:
"Notwithstanding the foregoing provisions of this
subsection 9.6, (x) at all times prior to the date upon
which the Borrower has obtained an Investment Grade
Rating, the trademark "Reebok" shall be owned by
Borrower, a Domestic Subsidiary or a Foreign Subsidiary
that is party to a Stock Pledge Agreement and (y) such
trademark shall at all times be subject to a valid
license agreement in favor of the Borrower having terms
substantially similar to the License Agreement
described in subsection 8.5(b)."
13. Amendment of Section 10. Section 10 of the Credit
Agreement hereby is amended by deleting the parenthetical phrase
"(including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters
of Credit shall have presented the documents required
thereunder)" in each instance in which such phrase appears
therein, and by substituting therefor the following:
(including, without limitation, all amounts of L/C
Obligations, whether or not the Borrower is the
Approved Account Party with respect thereto and whether
or not the beneficiaries of the then outstanding
Letters of Credit shall have presented the documents
required thereunder)
14. Amendment of Subsection 12.1. Subsection 12.1 of
the Credit Agreement hereby is amended by inserting into clause
(iii) of the proviso thereto, immediately following the phrase
"waive any provision of subsection 12.2" and immediately before
the phrase ", or except as set forth in subsection 12.2", the
phrase "(provided that such lowering does not have the effect of
reducing the stated rate of any interest or fee payable
hereunder)".
15. Amendment of Subsection 12.2(b). Subsection
12.2(b) of the Credit Agreement hereby is amended by inserting
therein, immediately following the phrase "all collateral
security and/or guarantee obligations provided for in any Loan
Document" and immediately before the phrase "promptly following
the request of the Borrower", the phrase "(other than the
guarantee obligations under subsection 4.5(d) hereof)".
16. Amendment of Subsection 12.9. Subsection 12.9 of
the Credit Agreement hereby is amended by deleting said
subsection 12.9 in its entirety and by substituting therefor the
following:
12.9 Judgment Currency. The obligations of
each Approved Account Party in respect of any
Reimbursement Obligation owing on account of any
Special Letters of Credit issued for its account to the
relevant Issuing Bank hereunder shall, notwithstanding
any judgment in a currency (the "judgment currency")
other than the currency in which such Special Letter of
Credit is denominated (the "denomination currency"), be
discharged only to the extent that on the Business Day
following receipt by such party of any sum adjudged to
be so due in the judgment currency such Issuing Bank
may in accordance with normal banking procedures
purchase the denomination currency with the judgment
currency; if the amount of the denomination currency so
purchased is less than the sum originally due to such
Issuing Bank in the denomination currency, such
Approved Account Party agrees, as a separate obligation
and notwithstanding any such judgment, to indemnify
such Issuing Bank against such loss, and if the amount
of the denomination currency so purchased exceeds the
sum originally due to any party to this Agreement, such
Issuing Bank agrees to remit to such Approved Account
Party such excess.
17. Amendment of Subsection 12.11(a). Subsection
12.11(a) of the Credit Agreement hereby is amended by deleting
therefrom the phrase "Pledge Agreements" and by substituting
therefor the phrase "Stock Pledge Agreements".
18. Representations and Warranties. The Borrower
hereby confirms, reaffirms and restates the representations and
warranties set forth in Section 6 of the Credit Agreement;
provided that each reference to the Credit Agreement therein
shall be deemed to be a reference to the Credit Agreement after
giving effect to this Amendment. The Borrower represents and
warrants that no Default or Event of Default has occurred and is
continuing.
19. Effectiveness. This Amendment shall become
effective upon receipt (including, without limitation, by
telecopier) by the Administrative Agent of counterparts hereof,
duly executed and delivered by the Borrower and the Majority
Lenders; provided that the provisions of Section 3 hereof shall
become effective only upon receipt (including, without
limitation, by telecopier) by the Administrative Agent of
counterparts hereof, duly executed and delivered by the Borrower
and each Lender.
20. Continuing Effect of Credit Agreement. This
Amendment shall not constitute a waiver or amendment of any other
provision of the Credit Agreement not expressly referred to
herein and shall not be construed as a waiver or consent to any
further or future action on the part of the Borrower that would
require a waiver or consent of the Administrative Agent or the
Lenders. Except as expressly amended hereby, the provisions of
the Credit Agreement are and shall remain in full force and
effect.
21. Counterparts. This Amendment may be executed by
the parties hereto in any number of counterparts, and all of such
counterparts taken together shall be deemed to constitute one and
the same instrument.
22. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered in New York, New York
by their proper and duly authorized officers as of the date first
above written.
REEBOK INTERNATIONAL LTD.
By:
Title:
CREDIT SUISSE,
as Administrative Agent
By:
Title:
By:
Title:
CREDIT SUISSE, as a Lender
By:
Title:
By:
Title:
ABN AMRO BANK N.V., as a Co-Agent
and as a Lender
By: ABN AMRO North America,
Inc.,
as its Agent
By:
Title:
By:
Title:
CITIBANK, N.A., as a Co-Agent and
as a Lender
By:
Title:
COMERICA BANK, as a Co-Agent and as
a Lender
By:
Title:
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE, as a Co-Agent
and as a Lender
By:
Title:
By:
Title:
CREDIT LYONNAIS NEW YORK BRANCH, as
a Co-Agent and as a Lender
By:
Title:
DRESDNER BANK AG, New York and
Grand Cayman Branches, as a
Co-Agent and as a Lender
By:
Title:
By:
Title:
THE FIRST NATIONAL BANK OF BOSTON,
as a Co-Agent and as a Lender
By:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as a Co-Agent and as a Lender
By:
Title:
FLEET NATIONAL BANK, as a Co-Agent
and as a Lender
By:
Title:
THE FUJI BANK, LIMITED, NEW YORK
BRANCH, as a Co-Agent and as a
Lender
By:
Title:
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as a Co-Agent and as a
Lender
By:
Title:
ISTITUTO BANCARIO SAN PAOLO DI
TORINO S.p.A., as a Co-Agent and as
a Lender
By:
Title:
By:
Title:
▇▇▇▇▇▇ BANK LTD - NEW YORK BRANCH,
as a Co-Agent and as a Lender
By:
Title:
By:
Title:
THE MITSUBISHI TRUST AND BANKING
CORPORATION, as a Co-Agent and as a
Lender
By:
Title:
THE SANWA BANK, LIMITED, as a Co-
Agent and as a Lender
By:
Title:
WACHOVIA BANK OF GEORGIA, N.A., as
a Co-Agent and as a Lender
By:
Title:
BANCA COMMERCIALE ITALIANA, NEW
YORK BRANCH
By:
Title:
By:
Title:
BANK OF AMERICA NATIONAL TRUST &
SAVINGS ASSOCIATION
By:
Title:
BANK OF MONTREAL
By:
Title:
THE BANK OF NEW YORK
By:
Title:
THE BANK OF NOVA SCOTIA
By:
Title:
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By:
Title:
BANQUE NATIONALE DE PARIS
By:
Title:
By:
Title:
BANQUE PARIBAS
By:
Title:
By:
Title:
BHF-BANK AKTIENGESELLSCHAFT
By:
Title:
By:
Title:
CAISSE NATIONALE DE CREDIT AGRICOLE
By:
Title:
CIBC INC.
By:
Title:
CORESTATES BANK, N.A.
By:
Title:
CREDITANSTALT CORPORATE FINANCE,
INC.
By:
Title:
By:
Title:
THE DAI-ICHI KANGYO BANK, LIMITED,
New York Branch
By:
Title:
FIRST UNION NATIONAL BANK OF NORTH
CAROLINA
By:
Title:
LLOYDS BANK PLC
By:
Title:
By:
Title:
LTCB TRUST COMPANY
By:
Title:
NATIONSBANK, N.A.
By:
Title:
THE NIPPON CREDIT BANK, LTD.
By:
Title:
THE SAKURA BANK, LIMITED
By:
Title:
SOCIETE GENERALE
By:
Title:
STANDARD CHARTERED BANK
By:
Title:
STATE STREET BANK AND TRUST COMPANY
By:
Title:
THE SUMITOMO BANK, LIMITED,
NEW YORK BRANCH
By:
Title:
THE TOKAI BANK, LIMTED
By:
Title:
UNITED STATES NATIONAL BANK OF
OREGON
By:
Title:
THE YASUDA TRUST AND BANKING CO.,
LTD.
By:
Title:
BANK OF SCOTLAND
By:
Title:
BANKERS TRUST COMPANY
By:
Title:
CREDITO ITALIANO S.p.A.
By:
Title:
DLJ CAPITAL FUNDING, INC.
By:
Title:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK
By:
Title:
PT BANK NEGARA INDONESIA (PERSERO)
By:
Title:
THE SUMITOMO TRUST & BANKING CO.,
LTD. NEW YORK BRANCH
By:
Title:
CARIPLO-CASSA di RISPARMIO della
PROVINCIE LOMBARDE S.p.A.
By:
Title:
▇▇▇▇▇▇ BROTHERS COMMERCIAL PAPER,
INC.
By:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.
By:
Title:
EXHIBIT A
SECTION 4 AMOUNT AND TERMS OF LETTER OF CREDIT SUB-FACILITY
4.1 L/C Commitment. (a) Subject to the terms and
conditions hereof, each Issuing Bank, in reliance on the
agreements of the other Lenders set forth in subsection 4.4(a),
agrees to issue any Letters of Credit requested to be issued by
it and so issued by it for the account of an Approved Account
Party on any Business Day during the Commitment Period in such
form as may be approved from time to time by such Issuing Bank;
provided that such Issuing Bank shall not issue any Letter of
Credit if, after giving effect to such issuance, such Issuing
Bank has actual knowledge that (i) the L/C Obligations would
exceed the L/C Commitment, (ii) the Available Commitment would be
less than zero or (iii) if the Letter of Credit to be issued is a
Special Letter of Credit, the aggregate amount of L/C Obligations
on account of Special Letters of Credit to be outstanding after
giving effect to the issuance thereof will be more than
$350,000,000.
(b) Each Letter of Credit shall:
(i) be either (1) a standby letter of credit issued to
support obligations of the Borrower and its Subsidiaries,
contingent or otherwise, for which Revolving Credit Loans
would be available (a "Standby Letter of Credit"), or (2) a
commercial letter of credit (including, without limitation,
a Special Letter of Credit) issued in respect of the
purchase of goods or services by the Borrower and its
Subsidiaries in the ordinary course of business (a
"Commercial Letter of Credit");
(ii) unless such Letter of Credit is a Special Letter
of Credit, be (1) issued from an office of the Issuing Bank
in the United States and (2) denominated in Dollars; and
(iii) expire no later than the earlier of (1) one year
following the date of issuance thereof and (2) five days
prior to the Termination Date; provided that any Letter of
Credit may provide for renewal thereof for additional one-
year periods on an "evergreen" basis (but not, in any event,
beyond the date referred to in clause (2) above).
(c) Each Letter of Credit shall be subject to the
Uniform Customs and, to the extent not inconsistent therewith,
the laws of the State of New York.
(d) No Issuing Bank shall at any time be obligated to
issue any Letter of Credit hereunder if such issuance would
conflict with, or cause such Issuing Bank or any L/C Participant
to exceed any limits imposed by, any applicable Requirement of
Law.
4.2 Procedure for Issuance of Letters of Credit. Any
Approved Account Party may from time to time give notice to the
Administrative Agent that such Approved Account Party desires to
have a Letter of Credit issued for its account and specifying the
proposed Issuing Bank with respect to such Letter of Credit. In
the event that the proposed Issuing Bank is reasonably acceptable
to the Administrative Agent, such Approved Account Party shall
request that such Issuing Bank issue a Letter of Credit by
delivering to such Issuing Bank (with a copy of such Application
to the Administrative Agent, in the case of any Standby Letter of
Credit) at its address for notices specified herein an
Application therefor, completed to the satisfaction of the
Issuing Bank, and such other certificates, documents and other
papers and information as the Issuing Bank may request. Upon
receipt of any Application, the Issuing Bank will process such
Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance
with its customary procedures and shall promptly issue the Letter
of Credit requested thereby by issuing the original of such
Letter of Credit to the beneficiary thereof or as otherwise may
be agreed by the Issuing Bank and the relevant Approved Account
Party; provided that the Issuing Bank shall in no event be
required to issue any Letter of Credit earlier than two Business
Days (or, in the case of Standby Letters of Credit, three
Business Days) after its receipt of the Application therefor and
all such other certificates, documents and other papers and
information relating thereto. In the event that the Letter of
Credit to be issued is a Standby Letter of Credit, the Issuing
Bank shall furnish a copy of such Standby Letter of Credit to
each of the Administrative Agent and the Borrower promptly
following the issuance thereof.
4.3 Fees, Commissions and Other Charges. (a) Each
Approved Account Party shall pay to:
(i) the relevant Issuing Bank, for its own account, a
letter of credit commission with respect to each Special
Letter of Credit issued by such Issuing Bank for the account
of such Approved Account Party, computed for each day during
the period when such Special Letter of Credit is outstanding
at the rate per annum equal to the face amount of such
Letter of Credit times the rate which is mutually agreed
between such Approved Account Party and such Issuing Bank
(which rate shall not, in any event, exceed the Applicable
Commitment Fee Rate in effect on the date of issuance of
such Special Letter of Credit); and
(ii) the Administrative Agent, for the account of
each Issuing Bank and the L/C Participants, a letter of
credit commission with respect to each other Commercial
Letter of Credit issued by such Issuing Bank, computed for
each day during the period when such Commercial Letter of
Credit is outstanding at the rate per annum equal to the
face amount of such Letter of Credit times the Applicable
Commitment Fee Rate on the date of payment.
Such commission shall be calculated on the basis of a 365- or
366-day year (as the case may be) and shall be payable, in
arrears, on each L/C Fee Payment Date to occur after the date of
issuance of such Letter of Credit and shall be nonrefundable.
(b) The Borrower shall pay to the Administrative
Agent, for the account of each Issuing Bank and the L/C
Participants, a letter of credit commission with respect to each
Standby Letter of Credit issued by such Issuing Bank, computed
for each day during the period for which payment is due at the
rate per annum equal to the Applicable Margin in effect for
Eurodollar Loans on such date (calculated on the basis of a 365-
or 366-day year, as the case may be) times the aggregate amount
available to be drawn under such Standby Letter of Credit on such
date. Such commissions shall be payable, in arrears, on each L/C
Fee Payment Date to occur after the issuance of such Standby
Letter of Credit and shall be nonrefundable.
(c) The Borrower shall pay to the relevant Issuing
Bank, for its own account, a fronting fee in the amount equal to
(i) 1/8 of 1% of the face amount of each Commercial Letter of
Credit (other than any Special Letter of Credit) issued by such
Issuing Bank and (ii) 1/8 of 1% per annum on the face amount of
each Standby Letter of Credit issued by it. Such fronting fees
shall be calculated on the basis of a 365- or 366-day year (as
the case may be) and shall payable, in arrears, on each L/C Fee
Payment Date with respect to any such Letters of Credit which
were outstanding during the period for which payment is due.
Notwithstanding anything to the contrary contained herein, no
such fronting fee shall be payable with respect to any Special
Letter of Credit.
(d) In addition to the foregoing fees and commissions,
each Approved Account Party shall pay or reimburse each Issuing
Bank for such normal and customary costs and expenses as are
incurred or charged by such Issuing Bank in issuing, effecting
payment under, amending or otherwise administering any Letter of
Credit issued by it for the account of such Approved Account
Party.
(e) The Administrative Agent shall, promptly following
its receipt thereof, distribute to the relevant Issuing Bank and
the L/C Participants all fees and commissions received by the
Administrative Agent for their respective accounts pursuant to
this subsection 4.3.
4.4 L/C Participations. (a) Each Issuing Bank
irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce such Issuing Bank to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the
Issuing Bank, on the terms and conditions hereinafter stated, for
such L/C Participant's own account and risk an undivided interest
equal to such L/C Participant's Revolving Credit Commitment
Percentage in the Issuing Bank's obligations and rights under
each Letter of Credit issued by it hereunder and the amount of
each draft paid by the Issuing Bank thereunder. Each L/C
Participant unconditionally and irrevocably agrees with such
Issuing Bank that, if a draft is paid under any Letter of Credit
for which such Issuing Bank is not reimbursed in full by the
relevant Approved Account Party in accordance with the terms of
this Agreement, such L/C Participant shall pay to such Issuing
Bank (through the Administrative Agent) upon demand an amount
equal to such L/C Participant's Revolving Credit Commitment
Percentage of the amount of such draft, or any part thereof,
which is not so reimbursed (or, in the case of any Special Letter
of Credit which is not denominated in Dollars, the amount of
Dollars necessary so that, following conversion by the Issuing
Bank into the relevant denomination currency at the spot rate of
exchange available to the Issuing Bank on the date of payment,
such L/C Participant shall have purchased its ratable share of
such draft).
(b) If any amount required to be paid by any L/C
Participant to an Issuing Bank pursuant to paragraph 4.4(a) in
respect of any unreimbursed portion of any payment made by such
Issuing Bank under any Letter of Credit issued by it is paid to
such Issuing Bank within three Business Days after the date such
payment is due, such L/C Participant shall pay to such Issuing
Bank (through the Administrative Agent) on demand an amount equal
to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate (or, with respect to Special Letters
of Credit which are not denominated in Dollars, the rate which
reasonably represents such Issuing Bank's cost of funds), as
quoted by such Issuing Bank, during the period from and including
the date such payment is required to the date on which such
payment is immediately available to such Issuing Bank, times
(iii) a fraction the numerator of which is the number of days
that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C
Participant pursuant to paragraph 4.4(a) is not in fact made
available to such Issuing Bank by such L/C Participant within
three Business Days after the date such payment is due, such
Issuing Bank shall be entitled to recover from such L/C
Participant, on demand, such amount with interest thereon
calculated from such due date at the rate per annum applicable to
ABR Loans hereunder (or, in the case of Special Letters of Credit
which are not denominated in Dollars, at a rate equal to the rate
which is reasonably determined by such Issuing Bank to reflect
its cost of funding in the relevant currency plus the Applicable
Margin then in effect with respect to ABR Loans). A certificate
of such Issuing Bank submitted to any L/C Participant (through
the Administrative Agent) with respect to any amounts owing under
this subsection 4.4 shall be conclusive in the absence of
manifest error.
(c) Whenever, at any time after an Issuing Bank has
made payment under any Letter of Credit and has received from any
L/C Participant its pro rata share of such payment in accordance
with subsection 4.4(a), such Issuing Bank receives any payment
related to such Letter of Credit (whether directly from the
Borrower or otherwise, including proceeds of collateral applied
thereto by such Issuing Bank), or any payment of interest on
account thereof, such Issuing Bank will distribute to the
Administrative Agent (for the account of such L/C Participant)
such L/C Participant's pro rata share thereof; provided, however,
that in the event that any such payment received by such Issuing
Bank shall be required to be returned by such Issuing Bank, such
L/C Participant shall return to such Issuing Bank (through the
Administrative Agent) the portion thereof previously distributed
by such Issuing Bank to it.
4.5 Reimbursement Obligation; Guarantee by the
Borrower. (a) Each Approved Account Party agrees to reimburse
each Issuing Bank on each date on which such Issuing Bank
notifies such Approved Account Party of the date and amount of a
draft presented under any Letter of Credit issued for the account
of such Approved Account Party by such Issuing Bank and paid by
such Issuing Bank for the amount of (i) such draft so paid and
(ii) any taxes, fees, charges or other costs or expenses incurred
by such Issuing Bank in connection with such payment. Each such
payment shall be made to such Issuing Bank at its address for
notices specified herein in Dollars (or, in the case of any
Special Letter of Credit which is not denominated in Dollars, in
lawful money in the currency in which such Special Letter of
Credit is denominated) and in immediately available funds.
(b) Interest shall be payable on any and all amounts
remaining unpaid by the relevant Approved Account Party under
this subsection 4.5 from the date such amounts become payable
(whether at stated maturity, by acceleration or otherwise) until
payment in full at the rate which would be payable on any
outstanding ABR Loans which were then overdue (or, in the case of
Special Letters of Credit which are not denominated in Dollars,
at a rate equal to the rate which is reasonably determined by the
relevant Issuing Bank to reflect its cost of funding in the
relevant currency plus 2% above the Applicable Margin then in
effect with respect to ABR Loans).
(c) Each drawing under any Letter of Credit shall
(unless it is reimbursed by the relevant Approved Account Party
on the date of drawing) constitute a request by the Borrower to
the Administrative Agent for a borrowing pursuant to subsection
3.2 of ABR Loans in the amount of such drawing (or, in the case
of a drawing under a Special Letter of Credit, for a borrowing of
ABR Loans in the amount which is reasonably determined by the
Administrative Agent to be the Dollar equivalent of the amount in
the relevant currency of such drawing). The borrowing date with
respect to such borrowing shall be the date of such drawing. The
Borrower hereby irrevocably and unconditionally authorizes and
instructs the Administrative Agent to apply the proceeds of such
borrowing to the reimbursement of amounts owing to the relevant
Issuing Bank on account of such Letter of Credit.
(d) The Borrower hereby unconditionally and
irrevocably guarantees to each Issuing Bank (and its successors,
indorsees, transferees and assigns) the prompt and complete
payment and performance by the Approved Account Parties when due
(whether at the stated maturity, by acceleration or otherwise) of
the Guaranteed L/C Obligations. The Borrower hereby further
acknowledges and agrees that (i) such guarantee shall remain in
full force and effect until the Guaranteed L/C Obligations are
paid in full and the Revolving Credit Commitments are terminated
(notwithstanding that from time to time prior thereto the
Borrower may be free from any Guaranteed L/C Obligations) and
(ii) it shall remain obligated under this subsection 4.5(d) under
any and all circumstances whatsoever and irrespective of any
event or circumstance whatsoever, foreseeable or unforeseeable,
that might (but for the provisions of this subsection 4.5(d))
constitute a legal or equitable discharge of such obligations
(including, without limitation, circumstances of the type
described in Sections 6, 7 and 8 of the Subsidiaries Guarantee,
which provisions are incorporated herein by reference, mutatis
mutandis, as if fully set forth herein). Notwithstanding any
payment or payments made by the Borrower hereunder, or any set-
off or application of funds of the Borrower by the Collateral
Agent, the Administrative Agent or any Lender, the Borrower shall
not be entitled to be subrogated to any of the rights of the
Collateral Agent, the Administrative Agent or any Lender against
the Borrower or against any collateral security or guarantee or
right of offset held by the Collateral Agent, the Administrative
Agent or any Lender for the payment of the Guaranteed L/C
Obligations, nor shall the Borrower seek or be entitled to seek
any contribution or reimbursement from any Approved Account Party
in respect of payments made by the Borrower hereunder, until all
amounts owing to the Administrative Agent and the Lenders by the
Borrower on account of the Guaranteed L/C Obligations have been
paid in full and the Revolving Credit Commitments have been
terminated.
4.6 Obligations Absolute. (a) The obligations of
each Approved Account Party under this Section 4 shall be
absolute and unconditional under any and all circumstances and
irrespective of any set-off, counterclaim or defense to payment
which any Approved Account Party may have or have had against any
Issuing Bank or any beneficiary of a Letter of Credit.
(b) Each Approved Account Party also agrees with each
Issuing Bank that such Issuing Bank shall not be responsible for,
and the Reimbursement Obligations of such Approved Account Party
under subsection 4.5(a) shall not be affected by, among other
things, (i) the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact
prove to be invalid, fraudulent or forged, or (ii) any dispute
between or among such Approved Account Party and any beneficiary
of any Letter of Credit or any other party to which such Letter
of Credit may be transferred or (iii) any claims whatsoever of
such Approved Account Party against any beneficiary of such
Letter of Credit or any such transferee.
(c) No Issuing Bank shall be liable for any error,
omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in
connection with any Letter of Credit issued by such Issuing Bank,
except for errors or omissions caused by such Issuing Bank's
gross negligence or willful misconduct.
(d) Each Approved Account Party agrees that any action
taken or omitted by an Issuing Bank under or in connection with
any Letter of Credit or the related drafts or documents, if done
in the absence of gross negligence of willful misconduct and in
accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on
such Approved Account Party and shall not result in any liability
of such Issuing Bank to such Approved Account Party.
4.7 Letter of Credit Payments. The responsibility of
each Issuing Bank to the relevant Approved Account Party in
connection with any draft presented for payment under any Letter
of Credit issued for the account of such Approved Account Party
shall, in addition to any payment obligation expressly provided
for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of
Credit in connection with such presentment are in conformity with
such Letter of Credit.
4.8 Application. To the extent that any provision of
any Application related to any Letter of Credit is inconsistent
with the provisions of this Section 4, the provisions of this
Section 4 shall apply.
4.9 Reporting by Issuing Banks. (a) Each Issuing
Bank hereby agrees to provide to the Administrative Agent prompt
notice of (i) the issuance by it of any Letter of Credit, (ii)
the amendment of any Letter of Credit issued by it, (iii) the
termination thereof, (iv) the presentation of any draft
thereunder and (v) the reimbursement by the relevant Approved
Account Party of such draft; provided, however, that, with
respect to Commercial Letters of Credit, such notice shall take
the form of a summary report which shall be provided to the
Administrative Agent (x) on the first Business Day of each week,
(y) on the last Business Day of each calendar month and (z) at
such other times (including, without limitation, daily) as the
Administrative Agent may from time to time request.
(b) Each Issuing Bank hereby agrees to provide to the
Administrative Agent, on the last Business Day of each calendar
month, a summary showing the outstanding balances of the Letters
of Credit (other than Special Letters of Credit) issued by such
Issuing Bank on each day during the month then ended.
4.10 Existing Standby Letters of Credit.
Notwithstanding anything to the contrary contained in this
Agreement or any Security Document, each of the standby letters
of credit described on Schedule VIII shall, from and after the
Closing Date, be deemed to have been issued pursuant to this
Section 4, with the Lender set forth in said Schedule VIII as the
issuing bank for each such existing standby letter of credit
being deemed to be the Issuing Bank in respect of such Standby
Letter of Credit hereunder and with each other Lender being
deemed to be an L/C Participant with respect to such Standby
Letter of Credit for purposes of this Agreement and the Security
Documents. The Borrower shall pay to the Administrative Agent,
for the accounts of the relevant Issuing Bank and L/C
Participants (or, in the case of the fees contemplated by
subsection 4.3(c), to the relevant Issuing Bank, for its own
account), the fees and commissions described in subsection 4.3
with respect to each such Standby Letter of Credit.