Exhibit 4.2
CREDIT AGREEMENT
(364 Day Facility)
by and among
SAKS INCORPORATED
as Borrower,
NATIONSBANK, N. A.,
as Administrative Agent,
NATIONSBANC ▇▇▇▇▇▇▇▇▇▇ SECURITIES LLC
as Lead Arranger,
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK,
and
THE CHASE MANHATTAN BANK,
as Co-Syndication Agents,
CITIBANK, N.A.,
as Documentation Agent
and
The Lenders from time to time party hereto
September 17, 1998
TABLE OF CONTENTS
Page
ARTICLE I -- Definitions and Terms
1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.02 Accounting Terms. . . . . . . . . . . . . . . . . . . . . . . 25
1.03 Terms Consistent. . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE II -- Revolving Credit Loans
2.01 Revolving Credit Loans. . . . . . . . . . . . . . . . . . . . 26
2.02 Reserved. . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.03 Competitive Bid Loans . . . . . . . . . . . . . . . . . . . . 27
2.04 Payment of Interest . . . . . . . . . . . . . . . . . . . . . 30
2.05 Payment of Principal. . . . . . . . . . . . . . . . . . . . . 31
2.06 Payments; Non-Conforming Payments . . . . . . . . . . . . . . 31
2.07 Borrower's Account. . . . . . . . . . . . . . . . . . . . . . 32
2.08 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.09 Pro Rata Payments . . . . . . . . . . . . . . . . . . . . . . 32
2.10 Reductions. . . . . . . . . . . . . . . . . . . . . . . . . . 33
2.11 Conversions and Elections of Subsequent Interest Periods 33
2.12 Facility Fees and Utilization Premium . . . . . . . . . . . . 33
2.13 Deficiency Loans. . . . . . . . . . . . . . . . . . . . . . . 34
2.14 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . 34
2.15 Additional Fees . . . . . . . . . . . . . . . . . . . . . . . 35
2.16 Revolving Credit Facility Extension and Term Loan Option 35
ARTICLE III -- [Reserved]
ARTICLE IV -- Change in Circumstances
4.01 Increased Cost and Reduced Return . . . . . . . . . . . . . . 38
4.02. Limitation on Types of Loans. . . . . . . . . . . . . . . . . 39
4.03 Illegality. . . . . . . . . . . . . . . . . . . . . . . . . . 39
4.04 Treatment of Affected Loans . . . . . . . . . . . . . . . . . 40
4.05 Compensation. . . . . . . . . . . . . . . . . . . . . . . . . 40
4.06 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE V -- Conditions to Making Loans
5.01 Conditions of Initial Loan. . . . . . . . . . . . . . . . . . 44
5.02 Conditions of Loans . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE VI -- Representations and Warranties
6.01 Representations and Warranties. . . . . . . . . . . . . . . . 48
ARTICLE VII -- Affirmative Covenants
7.01 Financial Reports, Etc. . . . . . . . . . . . . . . . . . . . 55
7.02 Maintain Properties . . . . . . . . . . . . . . . . . . . . . 56
7.03 Existence, Qualification, Etc.. . . . . . . . . . . . . . . . 56
7.04 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.05 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.06 True Books. . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.07 Right of Inspection . . . . . . . . . . . . . . . . . . . . . 57
7.08 Observe All Laws; Licenses. . . . . . . . . . . . . . . . . . 57
7.09 Covenants Extending to Subsidiaries . . . . . . . . . . . . . 57
7.10 Officer's Knowledge of Default. . . . . . . . . . . . . . . . 57
7.11 Suits or Other Proceedings. . . . . . . . . . . . . . . . . . 57
7.12 Notice of Discharge of Hazardous Material or
Environmental Complaint. . . . . . . . . . . . . . . . . . . . . . . . . 58
7.13 Environmental Compliance. . . . . . . . . . . . . . . . . . . 58
7.14 Year 2000 Notice. . . . . . . . . . . . . . . . . . . . . . . 58
7.15 Further Assurances. . . . . . . . . . . . . . . . . . . . . . 58
7.16 Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . 58
7.17 Continued Operations. . . . . . . . . . . . . . . . . . . . . 59
7.18 New Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . 59
ARTICLE VIII -- Negative Covenants
8.01 Consolidated Net Worth. . . . . . . . . . . . . . . . . . . . 61
8.02 Consolidated Fixed Charge Ratio . . . . . . . . . . . . . . . 61
8.03 Consolidated Funded Total Indebtedness to Consolidated EBITDA 61
8.04 Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . 61
8.05 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
8.06 Transfer of Assets. . . . . . . . . . . . . . . . . . . . . . 64
8.07 Investments; Acquisitions . . . . . . . . . . . . . . . . . . 65
8.08 Merger or Consolidation . . . . . . . . . . . . . . . . . . . 65
8.09 Transactions with Affiliates. . . . . . . . . . . . . . . . . 66
8.10 Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . 66
8.11 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . 66
8.12 Dissolution, etc. . . . . . . . . . . . . . . . . . . . . . . 66
8.13 Rate Hedging Obligations. . . . . . . . . . . . . . . . . . . 67
ARTICLE IX -- Events of Default and Acceleration
9.01 Events of Default . . . . . . . . . . . . . . . . . . . . . . 68
9.02 Agent to Act. . . . . . . . . . . . . . . . . . . . . . . . . 71
9.03 Cumulative Rights . . . . . . . . . . . . . . . . . . . . . . 71
9.04 No Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . 71
9.05 Allocation of Proceeds. . . . . . . . . . . . . . . . . . . . 72
ARTICLE X -- The Agent
10.01 Appointment, Powers, and Immunities. . . . . . . . . . . . . 73
10.02 Reliance by Agent . . . . . . . . . . . . . . . . . . . . . . 73
10.03 Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . 73
10.04 Rights as Lender. . . . . . . . . . . . . . . . . . . . . . . 74
10.05 Indemnification . . . . . . . . . . . . . . . . . . . . . . . 74
10.06 Non-Reliance on Agent and Other Lenders . . . . . . . . . . . 74
10.07 Resignation of Agent. . . . . . . . . . . . . . . . . . . . . 75
ARTICLE XI -- Miscellaneous
11.01 Assignments and Participations. . . . . . . . . . . . . . . . 76
11.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
11.03 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . 79
11.04 Right of Setoff; Adjustments. . . . . . . . . . . . . . . . . 79
11.05 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . 80
11.06 Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . 80
11.07 Amendments and Waivers. . . . . . . . . . . . . . . . . . . . 80
11.08 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . 81
11.09 Termination . . . . . . . . . . . . . . . . . . . . . . . . . 81
11.10 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . 81
11.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . . 81
11.12 Headings and References . . . . . . . . . . . . . . . . . . . 83
11.13 Severability. . . . . . . . . . . . . . . . . . . . . . . . . 83
11.14 Entire Agreement. . . . . . . . . . . . . . . . . . . . . . . 83
11.15 Agreement Controls. . . . . . . . . . . . . . . . . . . . . . 83
11.16 Usury Savings Clause. . . . . . . . . . . . . . . . . . . . . 83
11.17 Reserved. . . . . . . . . . . . . . . . . . . . . . . . . . . 84
11.18 Waiver of Jury Trial. . . . . . . . . . . . . . . . . . . . . 84
11.19 Removal of Lenders. . . . . . . . . . . . . . . . . . . . . . 84
11.20 Guaranty Terminations.. . . . . . . . . . . . . . . . . . . . 85
EXHIBIT A Commitments . . . . . . . . . . . . . . . . . . . . . . . . .A-1
EXHIBIT B Form of Assignment and Acceptance . . . . . . . . . . . . . .B-1
EXHIBIT C Notice of Appointment (or Revocation) of Authorized
Representative. . . . . . . . . . . . . . . . . . . . . . . .C-1
EXHIBIT D Form of Borrowing Notice--Revolving Credit Loans and/
or Competitive Bid Quote Request(364 Day Facility). . . . . .D-1
EXHIBIT E [Reserved]. . . . . . . . . . . . . . . . . . . . . . . . . .E-1
EXHIBIT F Form of Competitive Bid Quote (364 Day Facility). . . . . . .F-1
EXHIBIT G Form of Guaranty Agreement. . . . . . . . . . . . . . . . . .G-1
EXHIBIT H Form of Guarantor Joinder Agreement . . . . . . . . . . . . .H-1
EXHIBIT I Form of Revolving Credit Notes (364 Day Facility) . . . . . .I-1
EXHIBIT J Form of Competitive Bid Notes (364 Day Facility). . . . . . .J-1
EXHIBIT K Form of Interest Rate Selection Notice (364 Day
Facility) . . . . . . . . . . . . . . . . . . . . . . . . . .K-1
EXHIBIT L Form of Opinion of Counsel to the Borrower and Counsel
to the Guarantors . . . . . . . . . . . . . . . . . . . . . .L-1
EXHIBIT M Form of Compliance Certificate. . . . . . . . . . . . . . . .M-1
Schedule 6.01(d) Subsidiaries
Schedule 6.01(f) Contingent Liabilities
Schedule 6.01(g) Liens
Schedule 6.01(h) Tax Matters
Schedule 6.01(j) Litigation
Schedule 6.01(m) Patents
Schedule 6.01(o) Consents
Schedule 8.04 Indebtedness
CREDIT AGREEMENT
(364 Day Facility)
THIS CREDIT AGREEMENT (364 Day Facility), dated as of
September 17, 1998 (the "Agreement"), is made by and among:
SAKS INCORPORATED, a Tennessee corporation having its
principal place of business in Birmingham, Alabama (the
"Borrower"); and
Each lender executing and delivering a signature page hereto
and each other lender which may hereafter execute and deliver an
instrument of assignment with respect to this Agreement pursuant to
Section 11.01 hereof (hereinafter such lenders may be referred to
individually as a "Lender" or collectively as the "Lenders"); and
NATIONSBANK, N. A., a national banking association organized
and existing under the laws of the United States of America
("NationsBank"), in its capacity as Administrative Agent for the
Lenders (in such capacity, the "Agent"); and
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK and THE CHASE
MANHATTAN BANK, each in its capacity as Co-Syndication Agents and
CITIBANK, N.A., in its capacity as Documentation Agent;
W I T N E S S E T H:
WHEREAS, the Borrower has requested that the Lenders make
available to the Borrower a revolving credit facility in the
maximum aggregate principal amount at any time outstanding of
$750,000,000 with a maturity of 364 days, the proceeds of which are
to be used to provide working capital, to finance capital
expenditures, to finance Permitted Acquisitions (as herein defined)
and to provide for the general corporate purposes of the Borrower
and its Subsidiaries; and
WHEREAS, the Lenders and the Agent are willing to make such
facility available to the Borrower upon the terms and conditions
set forth herein;
NOW, THEREFORE, the Borrower, the Lenders and the Agent hereby
agree as follows:
ARTICLE I
Definitions and Terms
1.01 Definitions. For the purposes of this Agreement, in
addition to the definitions set forth above, the following terms
shall have the respective meanings set forth below:
"Absolute Rate" has the meaning assigned thereto in
Section 2.03(c)(ii)(C) hereof.
"Acquisition" means the acquisition, including without
limitation by means of merger or consolidation, by the
Borrower or any Subsidiary of (i) a controlling equity
interest in another Person (including the purchase of an
option, warrant or convertible or similar type security to
acquire such a controlling interest at the time it becomes
exercisable by the holder thereof), whether by purchase of
such equity interest or upon exercise of an option or warrant
for, or conversion of securities into, such equity interest,
(ii) assets of another Person which constitute all or
substantially all of the assets of such Person or (iii) a
Business Unit.
"Adjusted Eurodollar Rate" means, for any Eurodollar Loan
for any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) determined
by the Agent to be equal to the sum of (i) the quotient
obtained by dividing (x) the Eurodollar Rate for such
Eurodollar Loan for such Interest Period by (y) the difference
of 1 minus the Reserve Requirement for such Eurodollar Loan
for such Interest Period plus (ii) the Applicable Interest
Addition.
"Affiliate" means a Person (i) which directly or
indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, the Borrower,
(ii) which beneficially owns or holds 10% or more of any class
of the outstanding voting stock (or in the case of a Person
which is not a corporation, 10% or more of the equity
interest) of the Borrower, or (iii) 10% or more of any class
of the outstanding voting stock (or in the case of a Person
which is not a corporation, 10% or more of the equity
interest) of which is beneficially owned or held by the
Borrower. The term "control" means the possession, directly
or indirectly, of the power to direct or cause the direction
of the management and policies of such Person, whether through
ownership of voting stock, by contract or otherwise.
"Affiliate Transaction" has the meaning assigned thereto
in Section 8.09 hereof.
"Alternative Rating Agency" has the meaning assigned to
such term in the definition of "Applicable Interest Addition"
in Section 1.01 hereof.
"Applicable Commitment Percentage" means, at any time for
each Lender with respect to the Revolving Credit Facility a
fraction (expressed as a percentage), (i) the numerator of
which shall be the amount of such Lender's Revolving
Credit Commitment at such date of determination (which
Revolving Credit Commitment for each Lender as of the Closing
Date is set forth in Exhibit A attached hereto and
incorporated herein by reference), and (ii) the denominator of
which shall be the Total Revolving Credit Commitment at such
date of determination; provided, that the Applicable
Commitment Percentage of each Lender shall be increased or
decreased to reflect any assignments to or by such Lender
effected in accordance with Section 11.01 hereof. The
Applicable Commitment Percentage hereunder shall at all times
be equal to the Applicable Commitment Percentage as defined in
the Five Year Facility Credit Agreement.
"Applicable Facility Fee" means, at any time, that
percent per annum set forth in the table below corresponding
to the Level at which the Applicable Interest Addition is then
determined in accordance with the definition thereof:
Applicable
Level Facility Fee
I 0.200%
II 0.175%
III 0.125%
IV 0.100%
V 0.080%
Any change in the Level at which the Applicable Interest
Addition is determined shall result in a corresponding and
simultaneous change in the Applicable Facility Fee. As of the
date hereof, the initial Applicable Facility Fee equals
0.125%.
"Applicable Interest Addition" means for each Eurodollar
Loan that percent per annum set forth below in the applicable
column, which shall be (i) determined based upon the rating of
each rated class of the Borrower's long-term, senior unsecured
Indebtedness for Money Borrowed, and, if no such Indebtedness
is then outstanding, a class of long-term senior unsecured
Indebtedness for Money Borrowed that the Borrower may issue
from its shelf registration statement filed with the
Securities and Exchange Commission covering, among other
things, long-term senior unsecured Indebtedness for Money
Borrowed (the "Rated Debt"), assigned by S&P and ▇▇▇▇▇'▇ (or
to the extent permitted as described below, such other
Alternative Rating Agency) (the "Debt Rating") as specified
below and (ii) applicable to all Eurodollar Loans existing on
and after the first date a specific Debt Rating is effective
and continuing until, but not including, the date any change
in such Debt Rating is effective (the "Debt Rating Date"):
Applicable
Level Debt Rating (Eurodollar spread)
----- ------------- ---------------------
I Less than or equal to BB
by S&P and Ba2 by ▇▇▇▇▇'▇ 0.550%
II BB+ by S&P and Ba1 by ▇▇▇▇▇'▇ 0.450%
III BBB- by S&P and Baa3 by ▇▇▇▇▇'▇ 0.375%
IV BBB by S&P and Baa2 by ▇▇▇▇▇'▇ 0.300%
V Greater than or equal to BBB+
by S&P and Baa1 by ▇▇▇▇▇'▇ 0.270%
As of the date hereof, the initial Applicable Interest
Addition equals 0.375%.
In the event that the Debt Ratings assigned by S&P and
▇▇▇▇▇'▇ differ by one rating level, the Applicable Interest
Addition shall be determined by reference to the rating
level having the higher Debt Rating without regard to the
lower Debt Rating. In the event that the Debt Ratings
assigned by S&P and ▇▇▇▇▇'▇ differ by more than one rating
level, the Applicable Interest Addition shall be determined
by reference to the Debt Rating which is one rating level
higher than the lower assigned Debt Rating without regard
to the higher assigned Debt Rating. The final Debt Rating
level by which the Applicable Interest Addition is
determined is referred to herein as a "Level". By way of
illustration and not limitation, if S&P assigned a rating
of BB+ (i.e., Level II) and ▇▇▇▇▇'▇ assigns a rating of
Baa3 (i.e., Level III), the Applicable Interest Addition
will be 0.375%; however if S&P assigns a rating of BB
(i.e., Level I) and ▇▇▇▇▇'▇ assigns a rating of Baa1 (i.e.,
Level V), the Applicable Interest Addition will be 0.450%.
In the event that either S&P or ▇▇▇▇▇'▇ (but not both)
shall not make a rating of any class of Rated Debt, the
above calculations shall be made based on (i) the rating
provided by S&P or ▇▇▇▇▇'▇, whichever shall then maintain
a current rating, of the Rated Debt and (ii) the rating
provided by a nationally recognized securities rating
agency selected by the Borrower and approved by the Agent,
which shall be substituted for either S&P or ▇▇▇▇▇'▇, as
the case may be (the "Alternative Rating Agency"), of the
Rated Debt and the Alternative Rating Agency's equivalent
rating levels shall be substituted for the Debt Rating
levels of either S&P or ▇▇▇▇▇'▇, whichever shall no longer
then make the applicable Debt Rating; provided further; in
the event that no Alternative Rating Agency shall make a
rating of each class of Rated Debt and (i) only one of S&P
or ▇▇▇▇▇'▇ shall then make a Debt Rating, the Applicable
Interest Addition shall be determined by the Debt Rating
which is one Level lower than the Debt Rating assigned by
S&P or ▇▇▇▇▇'▇, as applicable (e.g., if only ▇▇▇▇▇'▇
provides a Debt Rating and such Debt Rating is Level V, the
Applicable Interest Addition shall be 0.300%); or (ii)
neither S&P nor ▇▇▇▇▇'▇ shall then make a Debt Rating, the
Applicable Interest Addition shall be Level I.
"Applicable Lending Office" means, for each Lender and
for each Type of Loan, the "Applicable Lending Office" of
such Lender (or of an affiliate of such Lender) designated
for such Type of Loan on the signature pages hereof or such
other office of such Lender (or an affiliate of such
Lender) as such Lender may from time to time specify to the
Agent and the Borrower by written notice in accordance with
the terms hereof as the office by which its Loans of such
Type are to be made and maintained.
"Assignment and Acceptance" means an Assignment and
Acceptance substantially in the form of Exhibit B attached
hereto and incorporated herein by reference (with blanks
appropriately filled in) delivered to the Agent in
connection with an assignment of a Lender's interest under
this Agreement pursuant to Section 11.01.
"Assuming Lender" has the meaning assigned thereto in
Section 2.16(c) hereof.
"Audited Restated Financial Statements" means,
collectively, the audited restated combined income
statement of the Borrower and its Subsidiaries (giving
effect to the Saks Acquisition) for the Fiscal Year ended
January 31, 1998 and the audited restated combined balance
sheet of the Borrower and its Subsidiaries (giving effect
to the Saks Acquisition) as at January 31, 1998.
"Authorized Representative" means any of the Chairman,
Vice Chairmen, President or Executive Vice Presidents of
the Borrower and, with respect to financial matters, the
Treasurer or the Chief Financial Officer of the Borrower
and, with respect to Borrowing Notices, Competitive Bid
Quote Requests and notices of Conversion or Continuation,
any person designated by the Treasurer or the Chief
Financial Officer in writing to the Agent, or any other
person expressly designated by the Board of Directors of
the Borrower (or the appropriate committee thereof) as an
Authorized Representative of the Borrower, as set forth
from time to time in a certificate substantially in the
form attached hereto as Exhibit C and incorporated herein
by reference.
"Base Rate" means, for any day, the rate per annum
equal to the higher of (a) the Federal Funds Rate for such
day plus one-half of one percent (0.500%) and (b) the Prime
Rate for such day. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be
effective on the effective date of such change in the Prime
Rate or Federal Funds Rate.
"Base Rate Loan" means any Loan for which the rate of
interest is determined by reference to the Base Rate.
"Board" means the Board of Governors of the Federal
Reserve System (or any successor body).
"Borrower's Account" means the demand deposit account
with the Agent designated by the Borrower from time to time
in writing delivered and acceptable to the Agent, or any
successor account thereto with the Agent, which may be
maintained at one or more offices of the Agent or an agent
of the Agent.
"Borrower's Audited Statements" has the meaning
assigned thereto in Section 6.01(f) hereof.
"Borrowing Notice" means the notice delivered by an
Authorized Representative in connection with a Loan (other
than a Competitive Bid Loan), in substantially the form
attached hereto as Exhibit D and incorporated herein by
reference.
"Business Day" means any day which is not a Saturday,
Sunday or a day on which banks in the State of North
Carolina are authorized or obligated by law, executive
order or governmental decree to be closed.
"Business Unit" means (i) one or more retail stores,
warehouses or distribution centers, including the related
land, buildings and trade fixtures of a Person or a
division of a Person, which may, but is not required to,
include inventory, receivables, furniture, fixtures and
equipment, and intangible and other assets related to such
retail stores, warehouses or distribution centers or (ii)
all or substantially all of a line or lines of business
conducted by a Person or a division of a Person.
"Capital Leases" means all leases which have been or
should be capitalized in accordance with Generally Accepted
Accounting Principles as in effect from time to time
including Statement No. 13 of the Financial Accounting
Standards Board and any successor thereof.
"Closing Date" means the date on which the conditions
set forth in Section 5.01 hereof have been satisfied.
"Code" means the Internal Revenue Code of 1986, as
amended, any successor provision or provisions and any
regulations promulgated thereunder.
"Combined Three Month Statements" has the meaning
assigned thereto in Section 6.01(f) hereof.
"Common Stock" means the common stock, par value $.10
per share, of the Borrower.
"Competitive Bid Borrowing" has the meaning assigned
thereto in Section 2.03(b) and shall consist of one or more
Competitive Bid Loans.
"Competitive Bid Facility" means the subfacility under
the Revolving Credit Facility described in Section 2.03
providing for Competitive Bid Loans to the Borrower.
"Competitive Bid Loan" means a Loan made by a Lender
pursuant to the Competitive Bid Facility provided for by
Section 2.03.
"Competitive Bid Notes" means, collectively, the
promissory notes of the Borrower evidencing Competitive Bid
Loans executed and delivered to the Lenders substantially
in the form of Exhibit J attached hereto and incorporated
herein by reference.
"Competitive Bid Outstandings" means, as of any date
of determination, the aggregate principal amount of all
Competitive Bid Loans then outstanding.
"Competitive Bid Quote" means an offer in accordance
with Section 2.03(c) by a Lender to make a Competitive Bid
Loan with one single specified interest rate, which shall
be in substantially the form of Exhibit F attached hereto
and incorporated herein by reference.
"Competitive Bid Quote Request" has the meaning
assigned to such term in Section 2.03(b) and shall be in
substantially the form of Exhibit D attached hereto and
incorporated herein by reference.
"Consenting Lender" has the meaning assigned to such
term in Section 2.16(a).
"Consistent Basis" in reference to the application of
Generally Accepted Accounting Principles means the
accounting principles observed in the period referred to
are comparable in all material respects to those applied in
the preparation of the Audited Restated Financial
Statements, which accounting principles shall be the same
in all material respects as those accounting principles
applied in the preparation of the Combined Three Month
Statements.
"Consolidated EBITDA" means, with respect to the
Borrower and its Subsidiaries for any period of computation
thereof, the sum of, without duplication, (i) Consolidated
Net Income, plus (ii) Consolidated Interest Expense, plus
(iii) taxes on income, plus (iv) amortization, plus (v)
depreciation, all determined on a consolidated basis in
accordance with Generally Accepted Accounting Principles
applied on a Consistent Basis; provided, however, that (x)
extraordinary and unusual charges incurred by the Borrower
directly as a result of (A) the Saks Acquisition
(including in any event repayment or retirement of
Indebtedness of the Saks REMIC Subsidiaries), the
Acquisition by the Borrower of ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ & Co.
effective January 31, 1998, the Acquisition by the Borrower
of Parisian, Inc. effective October 11, 1996, the
Acquisition by the Borrower of Younkers, Inc. effective
February 3, 1996, the Acquisition by the Borrower of ▇.▇.
▇▇▇▇▇▇▇▇▇'▇, Inc. effective February 1, 1997, the
prepayment of the Junior Subordinated Debentures, the
retirement of the Parisian Senior Subordinated Notes and
the retirement of the Senior Notes, and (B) any Permitted
Acquisition after the Closing Date in an amount up to and
including 10% of the Cost of Acquisition for such Permitted
Acquisition, and (y) any non-recurring, non-cash loss,
shall all be excluded from the computation of Consolidated
Net Income; provided further, however, that effective as of
the effective date of any Acquisition, Consolidated EBITDA
shall be computed giving pro forma effect to such
Acquisition for each Four-Quarter Period then and
thereafter occurring until such Acquisition has been
effective for a complete Four-Quarter Period.
"Consolidated Financing Charges" means those charges
owed and allocated to third parties with respect to
accounts receivable securitizations transacted in the
ordinary course of business.
"Consolidated Fixed Charge Ratio" means, with respect
to the Borrower and its Subsidiaries for the Four-Quarter
Period ending on the date of computation thereof, the ratio
of (i) Consolidated EBITDA plus Consolidated Financing
Charges plus, to the extent deducted in arriving at
Consolidated EBITDA, lease, rental and all other payments
made in respect of or in connection with operating leases,
to (ii) Consolidated Fixed Charges during such Four-Quarter
Period.
"Consolidated Fixed Charges" means, with respect to
Borrower and its Subsidiaries, for the periods indicated,
the sum of, without duplication, (i) Consolidated Interest
Expense, plus (ii) to the extent deducted in arriving at
Consolidated EBITDA, lease, rental and all other payments
made in respect of or in connection with operating leases,
plus (iii) Consolidated Financing Charges, all determined
on a consolidated basis in accordance with Generally
Accepted Accounting Principles applied on a Consistent
Basis; provided further, however, that effective as of the
effective date of any Acquisition, such calculations shall
be computed giving pro forma effect to such Acquisition for
each Four-Quarter Period then and thereafter occurring
until such Acquisition has been effective for a complete
Four-Quarter Period.
"Consolidated Funded Total Indebtedness" means, at any
time as of which the amount thereof is to be determined,
all Indebtedness for Money Borrowed of the Borrower and its
Subsidiaries (including, but not limited to, all current
maturities and borrowings under short term loans) plus the
face amount of all issued and outstanding standby letters
of credit and all obligations (to the extent not
duplicative) arising under such letters of credit, all
determined on a consolidated basis in accordance with
Generally Accepted Accounting Principles applied on a
Consistent Basis.
"Consolidated Interest Expense" means, with respect to
any period of computation thereof, the gross interest
expense of the Borrower and its Subsidiaries, including
without limitation (i) the amortization of debt discounts,
(ii) the amortization of all fees (including, without
limitation, fees payable in respect of a Swap Agreement)
payable in connection with the incurrence of Indebtedness
to the extent included in interest expense and (iii) the
portion of any payments made in connection with Capital
Leases allocable to interest expense, all determined on a
consolidated basis in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis.
"Consolidated Net Income" means, for any period of
computation thereof, the net income of the Borrower and its
Subsidiaries as determined on a consolidated basis in
accordance with Generally Accepted Accounting Principles
applied on a Consistent Basis; but excluding as income: (i)
net gains on the sale, conversion or other disposition of
capital assets and net gains on the acquisition,
retirement, sale or other disposition of capital stock and
other securities of the Borrower or its Subsidiaries, (ii)
any write-up of any asset, and (iii) any other net gain or
credit of an extraordinary nature, all determined in
accordance with Generally Accepted Accounting Principles
applied on a Consistent Basis.
"Consolidated Net Worth" means at any time as of which
the amount thereof is to be determined, the shareholders'
equity of the Borrower and its Subsidiaries determined on
a consolidated basis in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis
(excluding intercompany items among the Borrower and its
Subsidiaries and any upward adjustment after the Closing
Date due to revaluation of assets).
"Consolidated Subordinated Debt" means all
Consolidated Funded Total Indebtedness which is by its
terms subordinate to the Loans as required by, and in
substance acceptable to, the Agent.
"Consolidated Total Assets" means, as at any time of
determination thereof, the net book value of all assets of
the Borrower and its Subsidiaries as determined on a
consolidated basis in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis.
"Contingent Obligation" of any Person means (i) all
contingent liabilities required (or which, upon the
creation or incurring thereof, would be required) to be
included in the consolidated financial statements
(including footnotes) of such Person in accordance with
Generally Accepted Accounting Principles applied on a
Consistent Basis, including Statement No. 5 of the
Financial Accounting Standards Board, and (ii) all
reimbursement obligations of such Person with respect to
any letter of credit and all obligations of such Person
guaranteeing or in effect guaranteeing any Indebtedness of
any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including obligations of
such Person however incurred:
(a) to purchase such Indebtedness or any
property or assets constituting security therefor;
(b) to advance or supply funds in any manner
(x) for the purchase or payment of such Indebtedness
or (y) to maintain a minimum working capital, net
worth or other balance sheet condition or any income
statement condition of the primary obligor;
(c) to grant or convey any lien, security
interest, pledge, charge or other encumbrance on any
property or assets of such Person to secure payment of
such Indebtedness;
(d) to lease property or to purchase securities
or other property or services primarily for the
purpose of assuring the owner or holder of such
Indebtedness of the ability of the primary obligor to
make payment of such Indebtedness; or
(e) otherwise to assure the owner of the
Indebtedness of the primary obligor against loss in
respect thereof.
With respect to Contingent Obligations, such liabilities
shall be computed at the amount which, in light of all the
facts and circumstances existing at the time, represent the
present value of the amount which can reasonably be
expected to become an actual or matured liability.
"Continue", "Continuation", and "Continued" shall
refer to the continuation pursuant to Section 2.11 hereof
of a Eurodollar Loan from one Interest Period to the next
Interest Period.
"Convert", "Conversion", and "Converted" shall refer
to a conversion pursuant to Section 2.11 or Article IV of
one Type of Loan into another Type of Loan.
"Cost of Acquisition" means, as at the date of closing
any Acquisition, the sum of the following: (i) the value
of the capital stock, or warrants or options to acquire
capital stock, of the Borrower or any Subsidiary to be
transferred in connection therewith, (ii) any cash or other
property (excluding property described in clause (i)) or
the unpaid principal amount of any debt instrument given as
consideration in such Acquisition, and (iii) any
Indebtedness or liabilities assumed by the Borrower or its
Subsidiaries in connection with such Acquisition. For
purposes of determining the Cost of Acquisition for any
transaction, (A) the capital stock of the Borrower shall be
valued (I) at its market value as reported on the New York
Stock Exchange or any national securities exchange with
respect to shares that are freely tradeable, and (II) with
respect to shares that are not freely tradeable, as
determined by the Board of Directors of the Borrower (which
determination shall be conclusive), (B) the capital stock
of any Subsidiary shall be valued as determined by the
Board of Directors of such Subsidiary (which determination
shall be conclusive), and (C) with respect to any
Acquisition accomplished pursuant to the exercise of
options or warrants or the conversion of securities, the
Cost of Acquisition shall include both the cost of
acquiring such option, warrant or convertible security as
well as the cost of exercise or conversion.
"Credit Exposure" means for each Lender an amount
equal at all times (i) other than following the occurrence
and during the continuance of an Event of Default, to its
Revolving Credit Commitment, and (ii) following the
occurrence and during the continuance of an Event of
Default, to the sum of the aggregate principal amount of
Revolving Credit Loans owing to such Lender plus the
aggregate unutilized amounts of such Lender's Revolving
Credit Commitment plus the amount of such Lender's
Competitive Bid Outstandings.
"Debt Rating" has the meaning assigned to such term in
the definition of "Applicable Interest Addition" in Section
1.01 hereof.
"Debt Rating Date" has the meaning assigned to such
term in the definition of "Applicable Interest Addition" in
Section 1.01 hereof.
"Default" means any event or condition which, with the
giving or receipt of notice or lapse of time or both, would
constitute an Event of Default hereunder.
"Dollars" and the symbol "$" means dollars
constituting legal tender for the payment of public and
private debts in the United States of America.
"Eligible Assignee" means (i) a Lender; (ii) an
affiliate of a Lender; and (iii) any other Person approved
by the Agent and, unless an Event of Default has occurred
and is continuing at the time any assignment is effected in
accordance with Section 11.01, the Borrower, such approval
not to be unreasonably withheld or delayed by the Borrower
or the Agent, as applicable, and such approval to be deemed
given by the Borrower if no objection is received by the
assigning Lender and the Agent from the Borrower within six
(6) Business Days after written notice of such proposed
assignment has been provided by the assigning Lender to the
Borrower; provided, however, that neither the Borrower nor
an affiliate of the Borrower shall qualify as an Eligible
Assignee.
"Eligible Securities" means the following obligations
and any other obligations previously approved in writing by
the Agent:
(i) Government Securities;
(ii) the following debt securities of the
following agencies or instrumentalities of the United
States of America if at all times the full faith and
credit of the United States of America is pledged to
the full and timely payment of all interest and
principal thereof:
(a) all direct or fully guaranteed
obligations of the United States Treasury; and
(b) mortgage-backed securities and
participation certificates guaranteed by the
Government National Mortgage Association;
(iii) the following obligations of the
following agencies or instrumentalities of or
corporations established by the United States of
America:
(a) participation certificates and debt
obligations of the Federal Home Loan Mortgage
Corporation;
(b) consolidated debt obligations, and
obligations secured by a letter of credit, of the
Federal Home Loan Banks; and
(c) debt obligations and mortgage-backed
securities of the Federal National Mortgage
Association which have not had the interest
portion thereof severed therefrom;
(iv) obligations of any corporation organized
under the laws of any state of the United States of
America or under the laws of any other nation, payable
in the United States of America, expressed to mature
not later than 180 days following the date of issuance
thereof and rated in an investment grade rating
category by S&P or ▇▇▇▇▇'▇;
(v) interest bearing demand or time deposits
issued by any Lender or certificates of deposit
maturing within one year from the date of acquisition
issued by a bank or trust company organized under the
laws of the United States or of any state thereof
having capital surplus and undivided profits
aggregating at least $500,000,000 and being rated A-
or better by S&P or A-3 or better by ▇▇▇▇▇'▇;
(vi) Repurchase Agreements;
(vii) Pre-Refunded Municipal Obligations;
(viii) shares of mutual funds which invest in
obligations described in paragraphs (i) through (iii)
above, the shares of which mutual funds are at all
times rated "AAA" by S&P or Aaa by ▇▇▇▇▇'▇;
(ix) asset-backed remarketed certificates of
participation representing a fractional undivided
interest in the assets of a trust, which certificates
are rated at least "A-1" by S&P or "P-1" by Moody's;
(x) shares of money market funds which comply
with the provisions of Rule 2a-7 of the Securities and
Exchange Commission (17 C.F.R. Section 270.2a-7); and
(xi) other investments approved in writing by the
Required Lenders, which approval shall not be
unreasonably withheld.
Obligations listed in paragraphs (i), (ii) and (iii) above
which are in book-entry form must be held in a trust
account with the Federal Reserve Bank or with a clearing
corporation or chain of clearing corporations which has an
account with the Federal Reserve Bank.
"Environmental Laws" means any federal, state or local
statute, law, ordinance, code, rule, regulation, order,
decree, permit or license regulating, relating to, or
imposing liability or standards of conduct concerning, any
environmental matters or conditions, environmental
protection or conservation, including without limitation,
the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended; the Superfund Amendments
and Reauthorization Act of 1986, as amended; the Resource
Conservation and Recovery Act, as amended; the Toxic
Substances Control Act, as amended; the Clean Air Act, as
amended; the Clean Water Act, as amended; together with all
regulations promulgated thereunder, and any other
"Superfund" or "Superlien" law.
"ERISA" means, at any date, the Employee Retirement
Income Security Act of 1974, as amended, and the
regulations thereunder, all as the same shall be in effect
at such date.
"Eurodollar Business Day" means a domestic Business
Day and one on which the relevant international financial
markets are open for the transaction of the business
contemplated by this Agreement (including without
limitation dealings in U.S. Dollar deposits) in London,
England, New York, New York and Charlotte, North Carolina.
"Eurodollar Loan" means a Loan that bears interest at
rates based upon the Adjusted Eurodollar Rate.
"Eurodollar Rate" means, for any Eurodollar Loan for
any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in Dollars
at approximately 11:00 a.m. (London time) two Eurodollar
Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If
for any reason such rate is not available, the term
"Eurodollar Rate" shall mean, for any Eurodollar Loan for
any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Eurodollar
Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on
Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates (rounded upwards, if
necessary, to the nearest 1/100 of 1%).
"Event of Default" means any of the occurrences set
forth as such in Section 9.01 hereof.
"Federal Funds Rate" means, for any day, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New
York on the Business Day next succeeding such day; provided
that (i) if such day is not a Business Day, the Federal
Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if
no such rate is so published on such next succeeding
Business Day, the Federal Funds Rate for such day shall be
the average rate charged to the Agent (in its individual
capacity) on such day on such transactions as determined by
the Agent.
"Filing Date" has the meaning assigned thereto in
Section 5.01(a)(xiii) hereof.
"Fiscal Year" means the 52-week or 53-week period of
the Borrower ending on the Saturday of each calendar year
closest (whether before or after) to January 31 and "Fiscal
Year" followed by a numerical year means the Fiscal Year
which has a Fiscal Year Beginning occurring during such
numerical calendar year.
"Fiscal Year Beginning" means the first day of a
Fiscal Year.
"Five Year Facility" means the revolving credit
facility made available to the Borrower by the Lenders
under the Five Year Facility Credit Agreement.
"Five Year Facility Commitment" means with respect to
each Lender, the obligation of such Lender to make loans
to, and purchase participations in letters of credit issued
for the benefit of and swing line loans to, the Borrower
under the Five Year Facility.
"Five Year Facility Credit Agreement" means that
certain Amended and Restated Credit Agreement (Five Year
Facility) of even date herewith among the Borrower, the
Agent, the Co-Syndication Agents, the Documentation Agent
and the Lenders, as amended, modified or supplemented from
time to time.
"Five Year Facility Loans" means the Loans as defined
in the Five Year Facility Credit Agreement.
"Five Year Facility Termination Date" means the
Revolving Credit Termination Date (as defined in the Five
Year Facility Credit Agreement).
"Fixed Rate Loan" means a Loan which is either a
Eurodollar Rate Loan or a Competitive Bid Loan.
"Foreign Benefit Law" means any applicable statute,
law, ordinance, code, rule, regulation, order or decree of
any foreign nation or any province, state, territory,
protectorate or other political subdivision thereof
regulating, relating to, or imposing liability or standards
of conduct concerning, any pension, retirement, healthcare,
death, disability or other employee benefit plan.
"Foreign Subsidiary" means a Subsidiary not organized
or existing under the laws of the United States of America,
any state thereof, or the District of Columbia.
"Four-Quarter Period" means a period of four full
consecutive fiscal quarterly periods, taken together as one
accounting period, and in the event any such fiscal
quarterly period occurs prior to the effective date of any
Acquisition, or is the period in which such effective date
occurs (each a "Pre-Acquisition Period"), all financial
statements, data, computations and determinations for such
Four-Quarter Period shall be made on a pro forma basis for
each Pre-Acquisition Period giving effect to such
Acquisition for all prior periods.
"GAAP" or "Generally Accepted Accounting Principles"
means those principles of accounting set forth in
pronouncements of the Financial Accounting Standards Board,
the American Institute of Certified Public Accountants or
which have other substantial authoritative support and are
applicable in the circumstances as of the date of a report,
as such principles are from time to time supplemented and
amended, subject to compliance at all times with Section
1.02 hereof.
"Government Securities" means direct obligations of,
or obligations the timely payment of principal and interest
on which are fully and unconditionally guaranteed by, the
United States of America.
"Governmental Authority" means any Federal, state,
municipal, national, foreign or other governmental
department, commission, board, bureau, agency, court,
arbitration body or instrumentality or political
subdivision thereof or any entity or officer exercising
executive, legislative or judicial, regulatory or
administrative functions of or pertaining to any government
or any court, in each case whether a state of the United
States, the United States or foreign nation, state,
province or other governmental instrumentality.
"Guarantor Joinder Agreement" means a Guarantor
Joinder Agreement substantially in the form of Exhibit H
attached hereto and incorporated herein by reference (with
blanks appropriately filled in) executed and delivered to
the Agent in connection with a Material Subsidiary (or
other Person) becoming a Guarantor and party to the
Guaranty.
"Guarantors" means, collectively, (i) each Material
Subsidiary existing on the Closing Date and (ii) any other
Person who shall become a Material Subsidiary after the
Closing Date and shall become a party to the Guaranty as
provided in Section 7.18 hereof; provided further, for all
purposes of this Agreement, the term "Guarantor" shall be
deemed to be "Subsidiary" at all times following the
termination of the Guaranty in accordance with Section
11.20 hereof.
"Guaranty" means the Guaranty Agreement of the
Guarantors (including without limitation those Guarantors
which subsequently become a party thereto in accordance
with Section 7.18 hereof) in favor of the Agent
guaranteeing in whole or in part the payment of
Obligations, substantially in the form of Exhibit G
attached hereto and incorporated herein by reference, as
the same may be amended, modified or supplemented.
"Hazardous Material" means and includes any pollutant,
contaminant, or hazardous, toxic or dangerous waste,
substance or material (including without limitation
petroleum products, asbestos-containing materials and
lead), the generation, handling, storage, transportation,
disposal, treatment, release, discharge or emission of
which is subject to any Environmental Law.
"Indebtedness" means with respect to any Person,
without duplication, all Indebtedness for Money Borrowed,
all indebtedness of such Person for the acquisition of
property, all indebtedness secured by any Lien on the
property of such Person whether or not such indebtedness is
assumed, all liability of such Person by way of
endorsements (other than for collection or deposit in the
ordinary course of business), all Contingent Obligations,
all Rate Hedging Obligations, that portion of obligations
with respect to Capital Leases which in accordance with
Generally Accepted Accounting Principles is classified as
a liability on a balance sheet and all Synthetic Lease
Indebtedness; but excluding all accounts payable in the
ordinary course of business and only so long as payment
therefor is due within one year; provided, that in no event
shall the term Indebtedness include surplus and retained
earnings, minority interest in Subsidiaries, lease
obligations (other than pursuant to Capital Leases or in
connection with any tax retention operating lease or any
form of synthetic lease as provided above), reserves for
deferred income taxes and investment credits, other
deferred credits and reserves, and deferred compensation
obligations.
"Indebtedness for Money Borrowed" means for any Person
all indebtedness in respect of money borrowed, including
without limitation all Capital Leases and the deferred
purchase price of any property or asset, evidenced by a
promissory note, bond or similar written obligation for the
payment of money (including, but not limited to,
conditional sales or similar title retention agreements).
"Interest Period"
(a) means for each Eurodollar Loan a period
commencing on the date such Eurodollar Loan is made or
Converted and each subsequent period commencing on the last
day of the immediately preceding Interest Period for such
Eurodollar Loan, and ending, at the Borrower's option, on
the date one, two, three, six or (if available) nine months
thereafter as notified to the Agent by an Authorized
Representative three (3) Eurodollar Business Days prior to
the beginning of such Interest Period; provided, that,
(i) if the Authorized Representative fails to
notify the Agent of the length of an Interest Period
three (3) Eurodollar Business Days prior to the first
day of such Interest Period, the Loan for which such
Interest Period was to be determined shall be deemed
to be a Base Rate Loan;
(ii) if an Interest Period for a Eurodollar Loan
would end on a day which is not a Eurodollar Business
Day such Interest Period shall be extended to the next
Eurodollar Business Day (unless such extension would
cause the applicable Interest Period to end in the
succeeding calendar month, in which case such Interest
Period shall end on the next preceding Eurodollar
Business Day);
(iii) any Interest Period which begins on the
last Eurodollar 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 Eurodollar
Business Day of a calendar month;
(iv) no Interest Period shall extend past the (A)
Stated Revolving Credit Termination Date for any
Eurodollar Loan other than a Term Loan and (B) Term
Loan Termination Date for any Term Loan; and
(v) on any day, with respect to all Fixed
Rate Loans hereunder and as defined in the Five Year
Facility Credit Agreement, there shall be not more
than twenty (20) Interest Periods in effect; and
(b) means for each Competitive Bid Loan, the period
commencing on the date such Competitive Bid Loan is made
and ending on the date specified in the Competitive Bid
Quote Request and related Competitive Bid Quote for such
Competitive Bid Loan; provided that,
(i) no Interest Period for a Competitive Bid
Loan shall be for a period of less than seven days or
greater than 120 days;
(ii) no Interest Period for a Competitive Bid
Loan shall extend past the Stated Revolving Credit
Termination Date;
(iii) there shall not be more than twenty
(20) Interest Periods in effect on any day for all
Fixed Rate Loans hereunder and as defined in the Five
Year Facility Credit Agreement; and
(iv) each Interest Period shall end on a day that
is a Business Day.
"Investment Grade Rating" means the assignment of a
rating of both BBB- or higher by S&P and Baa3 or higher by
Moody's to the Rated Debt issued by the Borrower.
"Junior Subordinated Debentures" means the 7.5%
Junior Subordinated Debentures Due March 31, 2004 of the
Borrower issued in the original principal amount of
$17,500,000.
"Lending Party" has the meaning assigned thereto in
Section 11.03.
"Level" has the meaning assigned to such term in the
definition of "Applicable Interest Addition" in Section
1.01 hereof.
"Lien" means any interest in property securing any
obligation owed to, or a claim by, a Person other than the
owner of the property, whether such interest is based on
the common law, statute or contract, and including but not
limited to the lien or security interest arising from a
mortgage, encumbrance, pledge, security agreement,
conditional sale or trust receipt or a lease, consignment
or bailment for security purposes. For the purposes of
this Agreement, the Borrower and its Subsidiaries shall be
deemed to be the owners of any property which either of
them have acquired or hold subject to a conditional sale
agreement, financing lease, or other arrangement pursuant
to which title to the property has been retained by or
vested in some other Person for security purposes.
"Loan" or "Loans" means any of the Eurodollar Loans or
Base Rate Loans and includes, unless the context otherwise
requires or as specifically otherwise referenced,
Competitive Bid Loans, including all the foregoing as part
of the Term Loans.
"Loan Documents" means this Agreement, the Notes, the
Guaranty, any Pledge Agreement and all other instruments
and documents heretofore or hereafter executed or delivered
to and in favor of any Lender or the Agent in connection
with the Loans made under this Agreement as the same may be
amended, modified or supplemented from time to time.
"Loan Parties" means, collectively, the Borrower and,
until such time as the Guaranty is terminated in accordance
with Section 11.20 hereof, each of the Guarantors.
"Material Adverse Effect" means a material adverse
effect on (i) the business, business prospects, results of
operations or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole or (ii) the
ability of any Loan Party to observe and perform the
covenants and agreements contained herein or in any other
Loan Document or the ability of any Lender to receive the
benefit of any remedy provided thereto under any Loan
Document.
"Material Subsidiary" means any direct or indirect
Subsidiary of the Borrower, other than a Securitization
Subsidiary or a Saks REMIC Subsidiary, which (i) has total
assets equal to or greater than 5% of Consolidated Total
Assets (calculated as of the most recent fiscal period with
respect to which the Agent shall have received financial
statements required to be delivered pursuant to Sections
7.01(a) or (b) (or if prior to delivery of any financial
statements pursuant to such Sections, then calculated with
respect to the Combined Three Month Statements) (the
"Required Financial Information")) or (ii) has net income
equal to or greater than 5% of Consolidated Net Income
(each calculated for the most recent period for which the
Agent has received the Required Financial Information);
provided, however, that notwithstanding the foregoing, the
term "Material Subsidiaries" shall mean Subsidiaries of the
Borrower, other than Securitization Subsidiaries and Saks
REMIC Subsidiaries, that together with the Borrower have
assets equal to not less than 95% of Consolidated Total
Assets (calculated as described above but excluding assets
directly owned by Securitization Subsidiaries and Saks
REMIC Subsidiaries) and net income of not less than 95% of
Consolidated Net Income (calculated as described above but
excluding income directly earned by Securitization
Subsidiaries and Saks REMIC Subsidiaries); provided further
that if more than one combination of Subsidiaries satisfies
such threshold, then those Subsidiaries so determined to be
"Material Subsidiaries" shall be specified by the Borrower.
"Moody's" means ▇▇▇▇▇'▇ Investors Services, Inc.
"Multi-employer Plan" means an employee pension
benefit plan covered by Title IV of ERISA and in respect of
which the Borrower or any Subsidiary is an "employer" as
described in Section 4001(b) of ERISA, which is also a
multi-employer plan as defined in Section 4001(a)(3) of
ERISA.
"Net Proceeds" from a disposition of assets (other
than assets sold in the ordinary course of business and
accounts receivable sold in connection with an accounts
receivable securitization transacted in the ordinary course
of business by a Securitization Subsidiary) or issuance of
equity means cash payments received therefrom as and when
received, net of (i) all reasonable legal, accounting,
banking, underwriting, title and recording expenses,
commissions, discounts and other fees and expenses incurred
in connection therewith, (ii) all taxes required to be paid
or accrued as a consequence of such disposition or issuance
and (iii) all amounts necessary to repay Indebtedness for
Borrowed Money the repayment of which is secured by such
disposed assets.
"NMS" means NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC, a
Delaware limited liability company.
"Non-Consenting Lender" has the meaning assigned to
such term in Section 2.16(a).
"Notes" means, collectively, the Revolving Credit
Notes and Competitive Bid Notes.
"Obligations" means the obligations, liabilities and
Indebtedness of the Borrower with respect to (i) the
principal and interest on the Loans as evidenced by the
Notes, (ii) all liabilities of Borrower to any Lender which
arise under a Swap Agreement, and (iii) the payment and
performance of all other obligations, liabilities, fees and
Indebtedness of the Borrower to the Lenders or the Agent
hereunder, under any one or more of the other Loan
Documents or with respect to the Loans.
"Operating Documents" means with respect to any
corporation, limited liability company, partnership,
limited partnership, limited liability partnership or other
legally authorized incorporated or unincorporated entity,
the bylaws, operating agreement, partnership agreement,
limited partnership agreement or other comparable documents
relating to the operation, governance or management of such
entity.
"Organizational Action" means with respect to any
corporation, limited liability company, partnership,
limited partnership, limited liability partnership or other
legally authorized incorporated or unincorporated entity,
any corporate, organizational or partnership action
(including any required shareholder, member or partner
action), or other similar official action, as applicable,
taken by such entity.
"Organizational Documents" means with respect to any
corporation, limited liability company, partnership,
limited partnership, limited liability partnership or other
legally authorized incorporated or unincorporated entity,
the articles of incorporation, certificate of
incorporation, articles of organization, certificate of
limited partnership or other comparable organizational or
charter documents relating to the creation of such entity.
"Parisian Indenture" means that certain Amended and
Restated Indenture dated as of October 11, 1996 among the
Borrower, Parisian, Inc. and AmSouth Bank of Alabama
(formerly known as AmSouth Bank, N.A.), trustee, as amended
from time to time thereafter.
"Parisian Senior Subordinated Notes" means the 9.875%
Senior Subordinated Notes Due 2003 of Parisian, Inc. in the
original aggregate principal amount of $125,000,000 issued
pursuant to the Parisian Indenture.
"Permitted Acquisition" means an Acquisition beyond
the normal course of business effected with the consent and
approval of the board of directors or other applicable
governing body of the Person being acquired, and with the
duly obtained approval of such shareholders or other
holders of equity interest as such Person may be required
to obtain, so long as (i) immediately prior to and
immediately after the consummation of such Acquisition, no
Default or Event of Default has occurred and is continuing,
(ii) substantially all of the sales and operating profits
generated by such Person (or assets) so acquired or
invested are derived from (A) the same or related line or
lines of business as conducted by the Borrower and its
Subsidiaries on the Closing Date or (B) a line or lines of
business not inconsistent with the business substantially
as conducted by the Borrower and its Subsidiaries on the
Closing Date; provided that the Cost of Acquisition of all
such Acquisitions permitted pursuant to this clause (ii)(B)
shall not in the aggregate exceed $100,000,000 during any
Four-Quarter Period and (iii) if the Cost of Acquisition
therefor equals or exceeds $250,000,000, pro forma
historical financial statements as of the end of the most
recently completed Four-Quarter Period giving effect to
such Acquisition are delivered to the Agent not less than
five (5) Business Days prior to the consummation of such
Acquisition, together with a certificate of an Authorized
Representative demonstrating compliance with the financial
covenants set forth in Article VIII hereof after giving
effect to such Acquisition.
"Person" means an individual, partnership, limited
partnership, corporation, limited liability company,
limited liability partnership, trust, unincorporated
organization, association, joint venture or a government or
agency or political subdivision thereof.
"Pledge Agreement", "Pledged Stock" and "Pledgor" each
has the meaning assigned thereto in Section 7.18(b)(i)
hereof.
"Pre-Refunded Municipal Obligations" means obligations
of any state of the United States of America or of any
municipal corporation or other public body organized under
the laws of any such state which are rated, based on the
escrow, in the highest investment rating category by either
S&P or Moody's and which have been irrevocably called for
redemption and advance refunded through the deposit in
escrow of Government Securities or other debt securities
which are (i) not callable at the option of the issuer
thereof prior to maturity, (ii) irrevocably pledged solely
to the payment of all principal and interest on such
obligations as the same becomes due and (iii) in a
principal amount and bear such rate or rates of interest as
shall be sufficient to pay in full all principal of,
interest, and premium, if any, on such obligations as the
same becomes due as verified by a nationally recognized
firm of certified public accountants.
"Prime Rate" means the per annum rate of interest
established from time to time by NationsBank as its prime
rate, which rate may not be the lowest rate of interest
charged by NationsBank to its customers.
"Principal Office" means the office of the Agent at
NationsBank, N.A., presently located at Independence
Center, ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, 15th Floor, NC1-001-15-04,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇▇,
Agency Services, or such other office and address as the
Agent may from time to time designate.
"Quotation Date" has the meaning assigned to such term
in Section 2.03(b).
"Rate Hedging Obligations" means any and all
obligations of the Borrower or any Subsidiary, whether
absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all
renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements,
devices or arrangements designed to protect at least one of
the parties thereto from the fluctuations of interest
rates, exchange rates or forward rates applicable to such
party's assets, liabilities or exchange transactions,
including, but not limited to, Dollar-denominated or
cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar
protection agreements, forward rate currency or interest
rate options, puts, warrants and those commonly known as
interest rate "swap" agreements; and (ii) any and all
cancellations, buybacks, reversals, terminations or
assignments of any of the foregoing.
"Rated Debt" has the meaning assigned to such term in
the definition of "Applicable Interest Addition" in Section
1.01 hereof.
"Registration Statement" has the meaning assigned
thereto in Section 5.01(a)(xiii) hereof.
"Regulation D" means Regulation D of the Board as the
same may be amended or supplemented from time to time.
"Repurchase Agreement" means a repurchase agreement
entered into with (i) any financial institution whose debt
obligations or commercial paper are rated "A" or "A2" by
either of S&P or Moody's or "A-1" by S&P or "P-1" by
Moody's, or (ii) any Lender.
"Required Financial Information" has the meaning
assigned to such term in the definition of "Material
Subsidiary" in Section 1.01 hereof.
"Required Lenders" means, as of any date, Lenders on
such date having Credit Exposures aggregating more than 50%
of the aggregate Credit Exposures of all the Lenders on
such date.
"Reserve Requirement" means, at any time, the maximum
rate at which reserves (including, without limitation, any
marginal, special, supplemental, or emergency reserves) are
required to be maintained under regulations issued from
time to time by the Board (or any successor) by member
banks of the Federal Reserve System against "Eurocurrency
liabilities" (as such term is used in Regulation D).
Without limiting the effect of the foregoing, the Reserve
Requirement shall reflect any other reserves required to be
maintained by such member banks with respect to (i) any
category of liabilities which includes deposits by
reference to which the Adjusted Eurodollar Rate is to be
determined, or (ii) any category of extensions of credit or
other assets which include Eurodollar Loans. The Adjusted
Eurodollar Rate shall be adjusted automatically on and as
of the effective date of any change in the Reserve
Requirement.
"Revolving Credit Commitment" means with respect to
each Lender, the obligation of such Lender to make
Revolving Credit Loans to the Borrower up to an aggregate
principal amount at any one time outstanding equal to the
amount set forth opposite such Lender's name on Exhibit A
hereto as the same may be increased or decreased from time
to time pursuant to this Agreement; provided, however, that
amounts advanced by any Lender as Competitive Bid Loans
shall not reduce such Lender's Revolving Credit Commitment
or modify its obligation to make its Applicable Commitment
Percentage of Revolving Credit Loans.
"Revolving Credit Extension Date" means September 15,
1999 and each date thereafter, if any, to which the Stated
Revolving Credit Termination Date has been extended
pursuant to Section 2.16 hereof, but in no event later than
the Stated Term Loan Termination Date.
"Revolving Credit Facility" means the facility
described in Section 2.01 hereof providing for Revolving
Credit Loans, and the Term Loans, to the Borrower by the
Lenders in the aggregate principal amount equal to the
Total Revolving Credit Commitment.
"Revolving Credit Loan" means a Loan made pursuant to
the Revolving Credit Facility, including without limitation
the Term Loans and specifically excluding the Competitive
Bid Loans.
"Revolving Credit Notes" means, collectively, the
promissory notes of the Borrower evidencing Revolving
Credit Loans executed and delivered to the Lenders as
provided in Section 2.08(a) hereof substantially in the
form attached hereto as Exhibit I and incorporated herein
by reference, with appropriate insertions as to amounts,
dates and names of Lenders, as the same shall be amended,
modified or supplemented and in effect from time to time.
"Revolving Credit Outstandings" means, as at any time
of determination, the aggregate principal amount of all
Revolving Credit Loans and Competitive Bid Loans then
outstanding.
"Revolving Credit Termination Date" means the earliest
of (i) the Stated Revolving Credit Termination Date or (ii)
such date of termination of Lenders' obligations pursuant
to Section 9.01 upon the occurrence of an Event of Default
or (iii) such date as the Borrower may voluntarily and
permanently terminate the Revolving Credit Facility by
payment in full of all Revolving Credit Outstandings.
"S&P" means Standard & Poor's Rating Group, a division
of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Saks" means Saks Holdings, Inc., a Delaware
corporation.
"Saks Acquisition" has the meaning assigned thereto in
Section 5.01(a)(xiii) hereof.
"Saks Acquisition Agreement" has the meaning assigned
thereto in Section 5.01(a)(xiv) hereof.
"Saks REMIC Subsidiary" means any of Calwin Realty II,
Inc., Win Realty Holdings II, Inc., Florida Win Trust, Or.
Win, Inc., York Win Realty, Inc., Fifth Win, Inc., Ohio
Win, Inc., Tex Win II, Inc., Vir. Win, Inc., Cal SFA, Inc.,
Penn SFA, Inc., Tex SFA, Inc., Fifth Avenue Capital Trust
and Fifteenth Win, Inc.
"Securitization Subsidiary" means ▇▇▇▇▇▇▇▇'▇ Credit
Corporation, National Bank of the Great Lakes, SFA Finance
Company, SFA Finance Company II and any other present or
future Subsidiary (including any credit card bank) of the
Borrower that is, directly or indirectly, wholly owned by
the Borrower (except, in the case of SFA Finance Company
and SFA Finance Company II, for 1000 shares of Series A
Preferred Stock of SFA Finance Company owned by certain
independent directors of SFA Finance Company) and organized
for the purpose of and is only engaged in (i) originating,
purchasing, acquiring, financing, servicing or collecting
accounts receivable obligations of customers of the
Borrower or its Subsidiaries, (ii) issuing or servicing
credit cards, engaging in other credit card operations or
financing accounts receivable obligations of customers of
the Borrower and its Subsidiaries, (iii) the sale or
financing of such accounts receivable and interests therein
and (iv) other activities incident thereto.
"Senior Indenture" means that certain Indenture dated
as of May 21, 1997 among the Borrower and The First
National Bank of Chicago, as trustee, as amended from time
to time thereafter.
"Senior Notes" means the 8.125% Senior Notes due 2004
of the Borrower in the aggregate principal amount of
$125,000,000 issued pursuant to the Senior Indenture.
"Single Employer Plan" means any employee pension
benefit plan covered by Title IV of ERISA and in respect of
which the Borrower or any Subsidiary is an "employer" as
described in Section 4001(b) of ERISA, which is not a
Multi-employer Plan.
"Solvent" means, when used with respect to any Person,
that at the time of determination:
(i) the fair value of its assets (both at fair
valuation and at present fair saleable value on an
orderly basis) is in excess of the total amount of its
liabilities, including, without limitation, Contingent
Obligations; and
(ii) it is then able and expects to be able to
pay its debts as they mature; and
(iii) it has capital sufficient to carry on
its business as conducted and as proposed to be
conducted.
"Stated Revolving Credit Termination Date" means
September 15, 1999, or such later date as the Borrower and
the Lenders shall agree in writing pursuant to Section 2.16
hereof.
"Stated Term Loan Termination Date" means
September 17, 2003.
"Subsidiary" means any corporation or other entity in
which more than 50% of its outstanding voting stock or more
than 50% of all equity interests is owned directly or
indirectly by the Borrower and/or by one or more of the
Borrower's Subsidiaries at or after the Closing Date, and
specifically includes Saks and each of its subsidiaries as
of the Closing Date; notwithstanding the foregoing, the
reference to "Subsidiary" or "Subsidiaries" in Sections
6.01(f)(iii), (g), (k), (l), (m), (o), or (r), Section
7.01(d), Section 7.09 (as applicable to Sections 7.02 and
7.05) and Sections 7.12, 7.13, 7.18, 8.04, 8.05, 8.06, 8.07
(other than 8.07 (viii)), 8.08, 8.09, 8.12 and 11.20 and in
the introductory paragraph of Article VIII to the extent
relating to any of the Sections of such Article referred to
above does not include any Securitization Subsidiary.
"Swap Agreement" means one or more agreements between
the Borrower and another Person, on terms mutually
acceptable to the Borrower and such Person, which
agreements create Rate Hedging Obligations.
"Synthetic Lease Indebtedness" means, with respect to
a Person that is a lessee under a synthetic lease, an
amount equal to (i) the aggregate purchase price of any
property that the lessor under such synthetic lease
acquired, through one or a series of related transactions,
and thereafter leased to such Person pursuant to such
synthetic lease less (ii) the aggregate amount of all
payments of fixed rent or other rent payments which reduce
such Person's obligation under such synthetic lease and
which are not the financial equivalent of interest.
Synthetic Lease Indebtedness of a Person shall also
include, without duplication, the amount of Synthetic Lease
Indebtedness of others to the extent guarantied by such
Person.
"Term Loans" has the meaning assigned to such term in
Section 2.16(a) hereof.
"Term Loan Termination Date" means the earliest of (i)
the Stated Term Loan Termination Date, or (ii) such date of
termination of Lenders' obligations pursuant to Section
9.01 hereof upon the occurrence of an Event of Default, or
(iii) such date as the Borrower may voluntarily and
permanently terminate and pay in full all Revolving Credit
Outstandings, or (iv) the Five Year Facility Termination
Date.
"Total Combined Outstandings" means, as at any time of
determination, the sum of all Revolving Credit Outstandings
plus all Total Outstandings (as defined in the Five Year
Facility Credit Agreement).
"Total Facility Termination Date" has the meaning
assigned thereto in Section 11.09 hereof.
"Total Revolving Credit Commitment" means an amount
equal to $750,000,000, as reduced from time to time in
accordance with Sections 2.10 and 2.16 hereof.
"Type" means any type of Loan (i.e., a Base Rate Loan,
a Eurodollar Loan or a Competitive Bid Loan).
"Utilization Premium" means an additional interest
payment in an amount equal to 10 basis points per annum
calculated in accordance with Section 2.12(b) hereof.
"wholly owned" means, when used with respect to a
Subsidiary of the Borrower, that all of the outstanding
capital stock (excluding director qualifying shares) or
other comparable equity interest of such Subsidiary are
owned directly or indirectly by the Borrower.
"Year 2000 Compliant" has the meaning assigned thereto
in Section 6.01(u) hereof.
1.02 Accounting Terms. All accounting terms not
specifically defined herein shall have the meanings assigned to
such terms and shall be interpreted in accordance with Generally
Accepted Accounting Principles as in effect on the date of the
Audited Restated Financial Statements, which shall be the same
in all material respects as those accounting principles applied
in the preparation of the Combined Three Month Statements, and
applied on a Consistent Basis.
1.03 Terms Consistent. All of the terms defined in this
Agreement shall have such defined meanings when used in any of
the Loan Documents unless the context shall require otherwise.
All references to the Borrower, the Agent and any Lender shall
be deemed to include any successor or permitted assignee of any
thereof. All plural references and definitions shall have a
corresponding meaning in the singular, and all singular
references and definitions shall have a corresponding meaning in
the plural.
ARTICLE II
Revolving Credit Loans
2.01 Revolving Credit Loans.
(a) Revolving Credit Commitment. Subject to the terms and
conditions of this Agreement, each Lender severally agrees to
make Revolving Credit Loans to the Borrower, from time to time
on a pro rata basis as to the total borrowing of Revolving
Credit Loans requested by the Borrower on any day determined by
such Lender's Applicable Commitment Percentage of the Total
Revolving Credit Commitment up to but not exceeding the
Revolving Credit Commitment of such Lender; provided, however,
that the Lenders will not be required and shall have no
obligation to make any Revolving Credit Loans (i) so long as a
Default or an Event of Default has occurred and is continuing or
(ii) if the maturity of the Revolving Credit Notes has been
accelerated as a result of an Event of Default. Within such
limits, the Borrower may borrow, repay and reborrow hereunder,
a Base Rate Loan on a Business Day and a Eurodollar Loan on a
Eurodollar Business Day, from the Closing Date until, but (as to
borrowings and reborrowings) not including, the Revolving Credit
Termination Date;
(b) Amounts. The aggregate unpaid principal amount of the
Revolving Credit Outstandings shall not exceed at any time an
amount equal to the Total Revolving Credit Commitment. Each
Revolving Credit Loan made, Converted or Continued shall be in
a principal amount of at least $5,000,000 (or the remaining
Total Revolving Credit Commitment if less), and, if greater than
$5,000,000, an integral multiple of $1,000,000.
(c) Loans and Rate Selection.
(i) An Authorized Representative shall give the Agent
(1) at least three (3) Eurodollar Business Days'
irrevocable telephonic notice of each Eurodollar Loan
(whether representing an additional borrowing hereunder or
the Conversion of borrowing hereunder from Base Rate Loans
to Eurodollar Loans or the Continuation of borrowing
hereunder of Eurodollar Loans) prior to 11:30 A.M.,
Charlotte, North Carolina time; and (2) irrevocable
telephonic notice of each Base Rate Loan representing an
additional borrowing hereunder or the Conversion of
borrowing hereunder from Eurodollar Loans to Base Rate
Loans prior to 11:30 A.M. Charlotte, North Carolina time on
the day of such proposed Base Rate Loan. Each such notice
shall specify the amount of the Loan, the Type of Loan, the
date of the Loan and, if a Eurodollar Loan, the Interest
Period to be used in the computation of interest. The
Authorized Representative shall provide the Agent written
confirmation of each such telephonic notice on the same day
by telefacsimile transmission in the form of a Borrowing
Notice, for additional Loans, or in the form attached
hereto as Exhibit K and incorporated herein by reference as
to selection or Conversion of interest rates as to
outstanding Loans, in each case with appropriate
insertions, but failure to provide such confirmation shall
not affect the validity of such telephonic notice. The
duration of the initial Interest Period for each Loan that
is a Eurodollar Loan shall be as specified in the initial
Borrowing Notice. The Borrower shall have the option to
elect the duration of subsequent Interest Periods and to
Convert the Loans in accordance with Section 2.11 hereof.
If the Agent does not receive a notice of election of
duration of an Interest Period or to Convert by the time
prescribed hereby and by Section 2.11 hereof, the Borrower
shall be deemed to have elected to Convert such Loan to (or
Continue such Loan as) a Base Rate Loan until the Borrower
notifies the Agent in accordance herewith and with Section
2.11.
. (ii) Notice of receipt of each Borrowing Notice shall
be provided by the Agent to each Lender by telephone with
reasonable promptness, but not later than 1:00 P.M.
Charlotte, North Carolina time on the same day as Agent's
receipt of such notice. The Agent shall provide each
Lender written confirmation of such telephonic confirmation
by telefacsimile transmission but failure to provide such
notice shall not affect the validity of such telephonic
notice.
(iii) Not later than 3:00 P.M., Charlotte, North
Carolina time on the date specified for each Loan, each
Lender shall, pursuant to the terms and subject to the
conditions of this Agreement, make the amount of the Loan
or Loans to be made by it on such day available to the
Agent, by depositing or transferring the proceeds thereof
in Dollars and in immediately available funds at the
Principal Office. The amount so received by the Agent
shall, subject to the terms and conditions of this
Agreement, be made available to the Borrower not later than
3:30 P.M., Charlotte, North Carolina time by delivery of
the proceeds thereof to the Borrower's Account or otherwise
as shall be directed in the applicable Borrowing Notice by
the Authorized Representative.
2.02 Reserved.
2.03 Competitive Bid Loans. (a) In addition to
borrowings of Revolving Credit Loans, at any time prior to the
Revolving Credit Termination Date the Borrower may, as set forth
in this Section 2.03, request the Lenders to make offers to make
Competitive Bid Loans to the Borrower in Dollars. The Lenders
may, but shall have no obligation to, make such offers and the
Borrower may, but shall have no obligation to, accept any such
offers in the manner set forth in this Section 2.03. The making
of a Competitive Bid Loan by any Lender shall not reduce such
Lender's available Revolving Credit Commitment except as a
result of such Competitive Bid Loan reducing the availability
under the Total Revolving Credit Commitment. Immediately after
giving effect to each Competitive Bid Loan, Revolving Credit
Outstandings shall not exceed the Total Revolving Credit
Commitment. Each Competitive Bid Loan may be repaid only on the
last day of the Interest Period with respect thereto unless such
payment is accompanied by the additional payment, if any,
required by Section 4.05.
(b) When the Borrower wishes to request offers from
Lenders to make Competitive Bid Loans, it shall give the Agent
(which shall promptly notify the Lenders) notice (a "Competitive
Bid Quote Request") to be received no later than 10:00 A.M. on
the Business Day immediately preceding the date of borrowing
proposed therein (or such other time and date as the Borrower
and the Agent, with the consent of the Required Lenders, may
agree). The Borrower may request offers from Lenders to make
Competitive Bid Loans for up to four (4) different Interest
Periods in a single notice; provided that the request for each
separate Interest Period shall be deemed to be a separate
Competitive Bid Quote Request for a separate borrowing (a
"Competitive Bid Borrowing") of one or more Competitive Bid
Loans from the Lenders. Each such Competitive Bid Quote Request
shall be substantially in the form of Exhibit D hereto and shall
specify as to each Competitive Bid Borrowing:
(i) the proposed date of such Competitive Bid
Borrowing, which shall be a Business Day;
(ii) the amount of such Competitive Bid Borrowing,
which shall be at least $5,000,000 (or a larger multiple of
$1,000,000) but shall not cause the limits specified in
Section 2.03(a) to be violated;
(iii) the duration of the Interest Period
applicable thereto; and
(iv) the date on which the Competitive Bid Quotes are
to be submitted if it is before the proposed date of
borrowing (the date on which such Competitive Bid Quotes
are to be submitted is called the "Quotation Date").
Except as otherwise provided in this Section 2.03(b), no
Competitive Bid Quote Request shall be given within five (5)
Business Days (or such other number of days as the Borrower and
the Agent, with the consent of the Required Lenders, may agree)
of any other Competitive Bid Quote Request.
(c) (i) Each Lender may submit one or more Competitive
Bid Quotes, each containing an offer to make a Competitive
Bid Loan, in response to any Competitive Bid Quote Request;
provided that, if the Borrower's request under Section
2.03(b) specifies more than one Interest Period, such
Lender may make a single submission containing one or more
Competitive Bid Quotes for each such Interest Period. Each
Competitive Bid Quote must be submitted to the Agent not
later than 10:00 A.M. Charlotte, North Carolina time on the
Quotation Date (or such other time and date as the Borrower
and the Agent, with the consent of the Required Lenders,
may agree; the Agent shall promptly notify all Lenders of
such other agreed upon time and date); provided, that any
Competitive Bid Quote may be submitted by the Agent (or its
Applicable Lending Office) only if the Agent (or such
Applicable Lending Office) notifies the Borrower of the
terms of the offer contained therein not later than 9:45
A.M. (or 15 minutes prior to such other agreed upon time)
Charlotte, North Carolina time on the Quotation Date.
Subject to the express provisions of this Agreement, any
Competitive Bid Quote so made shall be irrevocable except
with the consent of the Agent given at the instruction of
the Borrower.
(ii) Each Competitive Bid Quote shall be substantially
in the form of Exhibit F hereto and shall specify:
(A) the proposed date of borrowing and the
Interest Period therefor;
(B) the principal amount of the Competitive Bid
Loan for which such offer is being made, which
principal amount shall be at least $1,000,000 (or a
larger multiple of $1,000,000); provided that (x) the
aggregate principal amount of all Competitive Bid
Loans for which a Lender submits Competitive Bid
Quotes in response to a Competitive Bid Quote Request
may not exceed the principal amount of the Competitive
Bid Borrowing for the Interest Period for which offers
were requested, and (y) the limits specified in
Section 2.03(a) shall not be exceeded;
(C) the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/10,000th of
1%) offered for each such Competitive Bid Loan (the
"Absolute Rate"); and
(D) the identity of the quoting Lender.
Unless otherwise agreed by the Agent and the Borrower, no
Competitive Bid Quote shall contain qualifying, conditional
or similar language or propose terms other than or in
addition to those set forth in the applicable Competitive
Bid Quote Request, and, in particular, no Competitive Bid
Quote may be conditioned upon acceptance by the Borrower of
all (or some specified minimum) of the principal amount of
the Competitive Bid Loan for which such Competitive Bid
Quote is being made.
(d) The Agent shall, as promptly as practicable after the
Competitive Bid Quote is submitted (but in any event not later
than 10:30 A.M. Charlotte, North Carolina time on the Quotation
Date), notify the Borrower of the terms (i) of any Competitive
Bid Quote submitted by a Lender that is in accordance with
Section 2.03(c) and (ii) of any Competitive Bid Quote that
amends, modifies or is otherwise inconsistent with a previous
Competitive Bid Quote submitted by such Lender with respect to
the same Competitive Bid Quote Request. Any such subsequent
Competitive Bid Quote shall be disregarded by the Agent unless
such subsequent Competitive Bid Quote is submitted solely to
correct a manifest error in such former Competitive Bid Quote.
The Agent's notice to the Borrower shall specify (A) the
aggregate principal amount of the Competitive Bid Loans for
which Competitive Bid Quotes have been received and (B) the
respective principal amounts and Absolute Rates so offered by
each Lender (identifying the Lender that made each Competitive
Bid Quote).
(e) Not later than 11:00 A.M. Charlotte, North Carolina
time on the Quotation Date (or such other time and date as the
Borrower and the Agent, with the consent of the Required
Lenders, may agree), the Borrower shall notify the Agent of its
acceptance or nonacceptance of the Competitive Bid Quotes so
notified to it pursuant to Section 2.03(d) (and the failure of
the Borrower to give such notice by such time shall constitute
nonacceptance) and the Agent shall promptly notify each affected
Lender. In the case of acceptance, such notice shall specify
the aggregate principal amount of Competitive Bid Quotes for
each Interest Period that are accepted. The Borrower may accept
any Competitive Bid Quote in whole or in part (provided that any
Competitive Bid Quote accepted in part shall be at least
$1,000,000 or a larger multiple of $1,000,000); provided that:
(i) the aggregate principal amount of each
Competitive Bid Borrowing may not exceed the applicable
amount set forth in the related Competitive Bid Quote
Request;
(ii) the aggregate principal amount of each
Competitive Bid Borrowing shall be at least $5,000,000 (or
a larger multiple of $1,000,000) but shall not cause the
limits specified in Section 2.03(a) to be violated;
(iii) acceptance of Competitive Bid Quotes may be
made only in ascending order of Absolute Rates, beginning
with the lowest rate so offered; and
(iv) the Borrower may not accept any Competitive Bid
Quote where the Agent has correctly advised the Borrower
that such offer fails to comply with Section 2.03(c)(ii) or
otherwise fails to comply with the requirements of this
Agreement (including, without limitation, Section 2.03(a)).
If Competitive Bid Quotes are made by two or more Lenders with
the same Absolute Rates, for an aggregate principal amount that
is greater than the amount in respect of which Competitive Bid
Quotes are accepted for the related Interest Period (after
taking into account the acceptance of all Competitive Bid Quotes
with lower Absolute Rates, if any, offered by any Lender for
such related Interest Period), then the principal amount of
Competitive Bid Loans in respect of which such Competitive Bid
Quotes are accepted shall be allocated by the Borrower among
such Lenders as nearly as possible (in amounts of at least
$1,000,000) in proportion to the aggregate principal amount of
such Competitive Bid Quotes. Determinations by the Borrower of
the amounts of Competitive Bid Loans and the Absolute Rates as
provided in Section 2.03(e)(iii) shall be conclusive in the
absence of manifest error.
(f) Any Lender whose Competitive Bid Quote has been
accepted in accordance with Section 2.03(e) shall, not later
than 1:00 P.M. Charlotte, North Carolina time on the date
specified for the making of such Competitive Bid Loan, make the
amount of such Competitive Bid Loan as accepted by the Borrower
available to the Agent at the Principal Office in Dollars and in
immediately available funds, for the account of the Borrower.
The amount so received by the Agent shall, subject to the terms
and conditions of this Agreement, be made available to the
Borrower on such date by depositing the same, in Dollars and in
immediately available funds, in the Borrower's Account or
otherwise as shall be directed by the Borrower.
2.04 Payment of Interest. (a) The Borrower shall pay
interest to the Agent at the Principal Office (i) for the
account of each Lender in the case of each Revolving Credit
Loan, on the outstanding and unpaid principal amount of each
Revolving Credit Loan made by such Lender for the period
commencing on the date of such Loan until such Loan shall be due
at the Adjusted Eurodollar Rate or the Base Rate, as elected or
deemed elected by the Borrower or otherwise applicable to such
Loan as herein provided, and (ii) for the account of each Lender
making a Competitive Bid Loan, on the outstanding and unpaid
principal amount of such Competitive Bid Loan for the period
commencing on the date of such Competitive Bid Loan until such
Competitive Bid Loan is paid in full at the applicable Absolute
Rate; provided, however, that if any Event of Default shall have
occurred and be continuing, all amounts outstanding hereunder
shall bear interest thereafter (i) in the case of a Eurodollar
Loan, at a rate of interest per annum which shall be two percent
(2%) above the Adjusted Eurodollar Rate for such Eurodollar Loan
until the end of the Interest Period during which such Event of
Default occurred, and thereafter at a rate of interest per annum
which shall be two percent (2%) above the Base Rate, (ii) or in
the case of a Competitive Bid Loan, at a rate of interest per
annum which shall be two percent (2%) above the applicable
Absolute Rate for such Competitive Bid Loan until the end of the
Interest Period during which such Event of Default occurred, and
thereafter at a rate of interest per annum which shall be two
percent (2%) above the Base Rate, and (iii) in the case of a
Base Rate Loan, at a rate of interest per annum which shall be
two percent (2%) above the Base Rate, or in each of (i), (ii)
and (iii) above, the maximum rate permitted by applicable law,
whichever is lower, from the date such amount was due and
payable until the date such amount is paid in full; provided
further, it is expressly agreed that the imposition of an
additional or higher rate of interest as provided in this
Section 2.04 shall not constitute a penalty or forfeiture.
(b) Interest on the outstanding principal balance of each
Loan shall be computed on the basis of a year of 360 days and
calculated for the actual number of days elapsed. Interest on
each Loan shall be paid (i) quarterly in arrears on the first
Business Day of each February, May, August and November
commencing November 2, 1998, on each Base Rate Loan, (ii) on the
last day of the applicable Interest Period for each Fixed Rate
Loan and, for any Eurodollar Rate Loan having an Interest Period
longer than three months also on the last day of every third
month of such Interest Period, and (iii) upon payment or
prepayment in full of the principal amount of such Loan (or the
date such payment or prepayment is due if earlier).
2.05 Payment of Principal. All Revolving Credit
Outstandings shall be due and payable to the Agent for the
benefit of each Lender (or to the Lender making Competitive Bid
Loans in the case of Competitive Bid Outstandings) in full on
the Revolving Credit Termination Date, or earlier as herein
expressly provided. Competitive Bid Loans shall be due and
payable to the Agent for the benefit of the Lender making such
Competitive Bid Loan in full on the last day of the Interest
Period for such Loan. The principal amount of any Loan may be
prepaid in whole or in part at any time without penalty;
provided, however, in connection with the prepayment of a Fixed
Rate Loan, the Borrower shall pay to the Agent for the account
of the applicable Lenders the amount, if any, required under
Section 4.05 hereof. In the event that at any time Revolving
Credit Outstandings exceed the Total Revolving Credit
Commitment, the Borrower shall promptly repay an amount of the
Revolving Credit Outstandings equal to or greater than such
excess. All prepayments made by the Borrower shall be in the
amount of $5,000,000 or such greater amount which is an integral
multiple of $1,000,000, or such other amount as necessary to
comply with this Section 2.05 or with Section 2.10, together
with accrued and unpaid interest on the amounts paid.
2.06 Payments; Non-Conforming Payments. (a) Each payment
of principal (including any prepayment), interest and other
amounts to be made by the Borrower under this Agreement and
other Loan Documents shall be made to the Agent at the Principal
Office, for the account of each Lender's Applicable Lending
Office, in Dollars and in immediately available funds, without
setoff, deduction or counterclaim, before 1:30 P.M. Charlotte,
North Carolina time on the date such payment is due. With
respect to Competitive Bid Loans, each payment of principal and
payment of interest shall be made to the Agent, for the account
of the Applicable Lending Office of the Lender making such
Competitive Bid Loan, at the Principal Office in Dollars and in
immediately available funds before 1:30 p.m. Charlotte, North
Carolina, time on the date such payment is due. The Borrower
shall give the Agent prior telephonic notice of any payment of
principal, such notice to be given by not later than 11:30 A.M.
Charlotte, North Carolina time, on the date of such payment.
(b) The Agent shall deem any payment by or on behalf of
the Borrower hereunder that is not made both (i) in Dollars and
in immediately available funds and (ii) prior to 1:30 P.M.
Charlotte, North Carolina time on the date payment is due to be
a non-conforming payment. Any such payment shall not be deemed
to be received by the Agent until the time such funds become
available funds. Any non-conforming payment shall be deemed not
to have been made for purposes of Section 9.01(a) and (b)
hereof. The Agent shall give prompt notice to the Authorized
Representative and each of the Lenders (confirmed in writing) if
any payment is non-conforming. Interest shall continue to
accrue on any principal as to which a non-conforming payment is
made until such funds become available funds (but in no event
less than the period from the date of such payment to the next
succeeding Business Day) at the respective rates of interest per
annum specified in Section 2.04(a) in respect of late payments
of interest, from the date such amount was due and payable until
the date such amount is paid in full.
(c) In the event that any payment hereunder or under the
Notes becomes due and payable on a day other than a Business
Day, then such due date shall be extended to the next succeeding
Business Day unless provided otherwise under clause (a) (ii)
under the definition of "Interest Period"; provided, that
interest shall continue to accrue during the period of any such
extension.
2.07 Borrower's Account. The Borrower shall continuously
maintain the Borrower's Account for the purposes herein
contemplated.
2.08 Notes. (a) Revolving Credit Loans and Term Loans
made by each Lender shall be evidenced by, and be repayable with
interest in accordance with the terms of, the Revolving Credit
Note payable to the order of such Lender in the amount of its
Revolving Credit Commitment, which Revolving Credit Note shall
be dated the Closing Date or such later date pursuant to an
Assignment and Acceptance and shall be duly completed, executed
and delivered by the Borrower.
(b) Competitive Bid Loans made by each Lender shall be
evidenced by, and be repayable with interest in accordance with
the terms of, the Competitive Bid Note payable to the order of
such Lender, which shall be dated the Closing Date or such later
date pursuant to an Assignment and Acceptance and shall be duly
completed, executed and delivered by the Borrower.
2.09 Pro Rata Payments. Except as otherwise provided
herein, (a) each payment and prepayment on account of the
principal of and interest on the Revolving Credit Loans and the
fees described in Section 2.12 hereof shall be made to the Agent
in the aggregate amount payable to the Lenders for the account
of the Lenders pro rata based on their Applicable Commitment
Percentages, (b) each payment on account of the principal of and
interest on a Competitive Bid Loan shall be made to the Agent
for the account of the respective Lender making such Competitive
Bid Loan, (c) all payments to be made by the Borrower for the
account of each of the Lenders on account of principal, interest
and fees, shall be made without set-off or counterclaim, and
(d) the Agent will promptly distribute such payments received to
the Lenders as provided for herein.
2.10 Reductions. The Borrower shall, by notice from an
Authorized Representative, have the right from time to time (but
not more frequently than once during each calendar quarter upon
not less than five (5) Business Days written notice to the
Agent) to reduce the Total Revolving Credit Commitment. The
Agent shall give each Lender, within one (1) Business Day,
telephonic notice (confirmed in writing) of such reduction.
Each such reduction shall be in the amount of $10,000,000 or
such greater amount which is in an integral multiple of
$5,000,000, and shall permanently reduce the Total Revolving
Credit Commitment and the Revolving Credit Commitment of each
Lender pro rata. Each reduction of the Total Revolving Credit
Commitment shall be accompanied by payment of the principal
amount of the Revolving Credit Outstandings to the extent that
the Revolving Credit Outstandings exceed the Total Revolving
Credit Commitment after giving effect to such reduction,
together with amounts required under Section 4.05.
2.11 Conversions and Elections of Subsequent Interest
Periods. The Borrower may:
(a) upon notice to the Agent on or before 11:30 A.M.
Charlotte, North Carolina time on any Business Day Convert all
or a part of Eurodollar Loans to Base Rate Loans on the last day
of the Interest Period for such Eurodollar Loans; and
(b) provided that no Default or Event of Default shall
have occurred and be continuing and subject to the limitations
set forth below and in Sections 4.01, 4.02 and 4.03 hereof, on
three (3) Eurodollar Business Days' notice to the Agent on or
before 11:30 A.M. Charlotte, North Carolina time:
(i) Continue Eurodollar Loans and elect a subsequent
Interest Period for all or a portion of Eurodollar Loans to
begin on the last day of the current Interest Period for
such Eurodollar Loans; or
(ii) Convert Base Rate Loans to Eurodollar Loans on
any Eurodollar Business Day.
Notice of any such Continuation or Conversion shall specify
the effective date of such Continuation or Conversion and, with
respect to Eurodollar Loans, the Interest Period to be
applicable to the Loan as Continued or Converted. Each
Continuation and Conversion pursuant to this Section 2.11 shall
be subject to the limitations on Eurodollar Loans set forth in
the definition of "Interest Period" herein and in Sections
2.01(a), (b) and (c) and Article IV hereof. All such
Continuations or Conversions of Loans shall be effected pro rata
based on the Applicable Commitment Percentages of the Lenders.
2.12 Facility Fees and Utilization Premium.
(a) Facility Fees. For the period beginning on the
Closing Date and ending on the Revolving Credit Termination Date
or, if any Revolving Credit Outstandings are converted into Term
Loans in accordance with Section 2.16(f) hereof, the Term Loan
Termination Date, the Borrower agrees to pay to the Agent, for
the pro rata benefit of the Lenders based on their Applicable
Commitment Percentages, the Applicable Facility Fee payable
quarterly in arrears on the amount of the Total Revolving Credit
Commitment. Such payments of fees provided for in this Section
2.12 (a) shall be due in arrears on the first Business Day of
each February, May, August and November, beginning November 2,
1998 to and on the Revolving Credit Termination Date.
Notwithstanding the foregoing, so long as any Lender fails to
make available any portion of its Revolving Credit Commitment
when requested, such Lender shall not be entitled to receive
payment of its pro rata share of such fee until such Lender
shall make available such portion. Such fee shall be calculated
on the basis of a year of 360 days for the actual number of days
elapsed.
(b) Utilization Premium. For the period beginning on the
Closing Date and ending on the Total Facility Termination Date,
the Borrower agrees to pay to the Agent, for the pro rata
benefit of the Lenders based on their Applicable Commitment
Percentages, an additional interest payment on each day on which
the amount of Total Combined Outstandings exceeds $750,000,000
in an amount equal to the Utilization Premium times the amount
of all Revolving Credit Outstandings less all Competitive Bid
Outstandings calculated on the basis of a year of 360 days.
Notwithstanding the foregoing, such additional interest payment
shall also be payable on the average daily amount of the
Revolving Credit Outstandings less all Competitive Bid
Outstandings during the period commencing on the Closing Date
and continuing until but excluding the date on which the
certificate is delivered to the Agent pursuant to Section
7.01(b)(ii) hereof immediately following the third fiscal
quarter of Fiscal Year 1998. Such additional interest payment
shall be payable in arrears on the first Business Day of each
February, May, August and November, beginning November 2, 1998.
2.13 Deficiency Loans. No Lender shall be responsible for
any default of any other Lender in respect to such other
Lender's obligation to make any Loan hereunder nor shall the
Revolving Credit Commitment of any Lender hereunder be increased
as a result of such default of any other Lender. Without
limiting the generality of the foregoing, in the event any
Lender shall fail to advance funds to the Borrower as herein
provided, the Agent may in its discretion, but shall not be
obligated to, advance under the applicable Note in its favor as
a Lender all or any portion of such amount or amounts (each, a
"deficiency advance") and shall thereafter be entitled to
payments of principal of and interest on such deficiency advance
in the same manner and at the same interest rate or rates to
which such other Lender would have been entitled had it made
such advance under its applicable Note; provided, that upon
payment to the Agent from such other Lender of the entire
outstanding amount of each such deficiency advance, together
with accrued and unpaid interest thereon, from the most recent
date or dates interest was paid to the Agent by the Borrower on
each Loan comprising the deficiency advance at the interest rate
per annum for overnight borrowing by the Agent from the Federal
Reserve Bank, then such payment shall be credited against the
applicable Note of the Agent in full payment of such deficiency
advance and the Borrower shall be deemed to have borrowed the
amount of such deficiency advance from such other Lender as of
the most recent date or dates, as the case may be, upon which
any payments of interest were made by the Borrower thereon.
2.14 Use of Proceeds. The proceeds of the Loans shall be
used by the Borrower and its Subsidiaries to provide working
capital, to finance capital expenditures, to finance Permitted
Acquisitions and to provide for the general corporate purposes
of the Borrower and its Subsidiaries. None of such proceeds
will be used, directly or indirectly, for the purpose of
purchasing or carrying any margin stock or for the purpose of
reducing or retiring any Indebtedness which was originally
incurred to purchase or carry margin stock or for any other
purpose which might constitute any of the Loans under this
Agreement a "purpose credit" directly or indirectly secured by
margin stock within the meaning of Regulation U (12 C.F.R. Part
221) or Regulation X (12 C.F.R. Part 224) of the Board.
2.15 Additional Fees. In addition to any fees described
above, the Borrower agrees to pay to the Agent, NMS and
NationsBank such other fees as may be agreed to in a separate
writing or writings.
2.16 Revolving Credit Facility Extension and Term Loan
Option.
(a) With the consent of the Lenders (the "Consenting
Lenders") having seventy-five percent (75%) or more of the
aggregate Credit Exposures of all Lenders (any Lender not so
consenting being referred to as a "Non-Consenting Lender"), at
each Revolving Credit Extension Date the Borrower can elect to
extend the Stated Revolving Credit Termination Date for an
additional period of 364 days commencing on such Revolving
Credit Extension Date; provided, however, that in no event shall
the Stated Revolving Credit Termination Date be extended beyond
the earlier to occur of the Stated Term Loan Termination Date
and the Five Year Facility Termination Date.
(b) The Borrower shall notify the Lenders of its request
for such an extension by delivering to the Agent notice of such
request signed by an Authorized Representative not more than
sixty (60) days nor less than forty-five (45) days prior to the
applicable Revolving Credit Extension Date. Notice of receipt
of such request shall be provided by the Agent to the Lenders.
The Agent shall notify the Borrower in writing not later than
thirty (30) days nor more than forty-five (45) days prior to the
applicable Revolving Credit Extension Date of the decision of
the Lenders. Failure by any Lender to respond to a request for
an extension shall constitute a refusal of such Lender to give
its consent to such extension. Failure by the Agent to give
such notice to the Borrower as a result of not receiving the
consent of Lenders having seventy-five percent (75%) or more of
the aggregate Credit Exposures of all Lenders to such extension
shall constitute refusal by the Lenders to extend the Stated
Revolving Credit Termination Date.
(c) If less than all of the Lenders consent to any such
request which has been approved pursuant to subsection (a) of
this Section 2.16, the Borrower shall either (i) arrange not
less than fifteen (15) days prior to the Stated Revolving Credit
Termination Date (the "Replacement Lender Date") for one or more
Consenting Lenders, or for one or more other banks or financial
institutions complying with the requirements set forth in
Section 11.01 (any of the foregoing referred to as an "Assuming
Lender"), as of the Revolving Credit Extension Date to effect an
assignment of all of the Revolving Credit Commitment (along with
an equivalent pro rata portion of the Five Year Facility
Commitment) of one or more Non-Consenting Lenders in the manner
provided in Section 11.19(A) or (ii) payoff such Non-Consenting
Lender(s) in the manner provided for in Section 11.19(B). The
Borrower shall deliver written notice to the Agent and each
Consenting Lender of such arrangement with any Assuming Lender
not less than fifteen (15) days prior to the Stated Revolving
Credit Termination Date.
(d) On each Revolving Credit Extension Date, each Assuming
Lender shall become a Lender for all purposes under this
Agreement and the other Loan Documents without any further
acknowledgment by or the consent of the other Lenders; provided,
however, that the Agent shall have received not less than ten
(10) days prior to such Revolving Credit Extension Date an
Assignment and Acceptance, effective as of such Revolving Credit
Extension Date, from each Assuming Lender duly executed by such
Assuming Lender and the applicable Non-Consenting Lender with
respect to both the Revolving Credit Facility and the Five Year
Facility. The Total Revolving Credit Commitment on the
Revolving Credit Extension Date shall be equal to the sum,
without duplication, of the Revolving Credit Commitments of each
Assuming Lender and each Consenting Lender.
(e) If on any Revolving Credit Extension Date the Borrower
has not so elected to extend the Stated Revolving Credit
Termination Date then in effect, or if Consenting Lenders with
sufficient Credit Exposures have not consented to such
extension, then as of such Stated Revolving Credit Termination
Date, except as provided otherwise in, and subject to the
Borrower's compliance with the terms of, Section 2.16(f) below,
(i) the Total Revolving Credit Commitment shall be reduced to
zero, and (ii) all Revolving Credit Outstandings shall be due
and payable in full.
(f) If with respect to any Revolving Credit Extension Date
the Borrower does not so elect to extend the Stated Revolving
Credit Termination Date then in effect, or if Consenting Lenders
with sufficient Credit Exposures have not consented to such
extension, then not less than fifteen (15) days prior to the
Stated Revolving Credit Termination Date, the Borrower can elect
to convert any or all Revolving Credit Outstandings as of such
date into a term loan on such date in the original principal
amount equal to such Revolving Credit Outstandings. Revolving
Credit Outstandings so converted by the Borrower in accordance
with this Section 2.16 shall be referred to as the "Term Loans."
The Total Revolving Credit Commitment shall be permanently
reduced on the Stated Revolving Credit Termination Date to an
amount equal to the aggregate principal amount of the Term Loans
on such date. The Term Loans shall be repaid on the Term Loan
Termination Date. The Term Loans may be comprised of Base Rate
Loans and Eurodollar Rate Loans as the Borrower may elect in
accordance with the provisions of this Article II for Revolving
Credit Loans. The Term Loans shall bear interest on the same
terms as the Revolving Credit Loans prior to the conversion to
Term Loans until the Continuation or Conversion thereof pursuant
to Section 2.11 hereof. Amounts repaid or prepaid on the Term
Loans may not be reborrowed, and the Total Revolving Credit
Commitment shall be permanently reduced by any such amounts.
(g) If on the Stated Revolving Credit Termination Date the
Borrower does not so elect to convert all of Revolving Credit
Outstandings as of such date to Term Loans as described in (f)
above, then on the Stated Revolving Credit Termination Date, (i)
all Revolving Credit Outstandings as of such date which are not
so converted shall be due and payable in full and (ii) the Total
Revolving Credit Commitment shall be reduced to the amount, if
any, of Revolving Credit Outstandings so converted to Term
Loans.
ARTICLE III
[Reserved]
ARTICLE IV
Change in Circumstances
4.01 Increased Cost and Reduced Return.
(a) If, after the date hereof, the adoption of any
applicable law, rule, or regulation, or any change in any
applicable law, rule, or regulation, or any change in the
interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or compliance by any
Lender (or its Applicable Lending Office) with any request or
directive (whether or not having the force of law) of any such
Governmental Authority, central bank, or comparable agency:
(i) shall subject such Lender (or its Applicable
Lending Office) to any tax, duty, or other charge with
respect to any Fixed Rate Loans, its Note, or its
obligation to make Eurodollar Loans, or change the basis of
taxation of any amounts payable to such Lender (or its
Applicable Lending Office) under this Agreement or its Note
in respect of any Fixed Rate Loans (other than taxes
imposed on the overall net income of such Lender by the
jurisdiction in which such Lender has its principal office
or such Applicable Lending Office);
(ii) shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar
requirement (other than the Reserve Requirement utilized in
the determination of the Adjusted Eurodollar Rate) relating
to any extensions of credit or other assets of, or any
deposits with or other liabilities or commitments of, such
Lender (or its Applicable Lending Office), including the
Revolving Credit Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its
Applicable Lending Office) or on the London interbank
market any other condition affecting this Agreement or its
Notes or any of such extensions of credit or liabilities or
commitments;
and the result of any of the foregoing is to increase the cost
to such Lender (or its Applicable Lending Office) of making,
Converting into, Continuing, or maintaining any Fixed Rate Loans
or to reduce any sum received or receivable by such Lender (or
its Applicable Lending Office) under this Agreement or its Notes
with respect to any Fixed Rate Loans, then the Borrower shall
pay to such Lender on demand such amount or amounts as will
compensate such Lender for such increased cost or reduction. If
any Lender requests compensation by the Borrower under this
Section 4.01(a), the Borrower may, by notice to such Lender
(with a copy to the Agent), suspend the obligation of such
Lender to make or Continue Eurodollar Loans, or to Convert Base
Rate Loans into Loans of such Type, until the event or condition
giving rise to such request ceases to be in effect (in which
case the provisions of Section 4.04 shall be applicable);
provided that such suspension shall not affect the right of such
Lender to receive the compensation so requested.
(b) If, after the date hereof, any Lender shall have
determined that the adoption of any applicable law, rule, or
regulation regarding capital adequacy or any change therein or
in the interpretation or administration thereof by any
Governmental Authority, central bank, or comparable agency
charged with the interpretation or administration thereof, or
any request or directive regarding capital adequacy (whether or
not having the force of law) of any such Governmental Authority,
central bank, or comparable agency, has or would have the effect
of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of such
Lender's obligations hereunder to a level below that which such
Lender or such corporation could have achieved but for such
adoption, change, request, or directive (taking into
consideration its policies with respect to capital adequacy),
then from time to time upon demand the Borrower shall pay to
such Lender such additional amount or amounts as will compensate
such Lender for such reduction.
(c) Each Lender shall promptly notify the Borrower and the
Agent of any event of which it has knowledge, occurring after
the date hereof, which will entitle such Lender to compensation
pursuant to this Section 4.01 for a period not greater than 180
days and will designate a different Applicable Lending Office if
such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the judgment of such
Lender, be otherwise disadvantageous to it. Any Lender claiming
compensation under this Section 4.01 shall furnish to the
Borrower and the Agent a statement setting forth the additional
amount or amounts to be paid to it hereunder which shall be
conclusive when made in good faith and in the absence of
manifest error. In determining such amount, such Lender may use
any reasonable averaging and attribution methods. Any claim for
compensation under this Section 4.01 shall be made by the
applicable Lender within 180 days after the date on which the
officer of such Lender who has responsibility for compliance
with the obligations under this Agreement knows or has reason to
know of such Lender's right to any compensation under this
Section 4.01 or, if any such Lender fails to deliver such demand
within such 180-day period, such Lender shall only be entitled
to compensation under this Section 4.01 from and after the date
that is 180 days prior to the date such Lender delivers such
demand.
4.02. Limitation on Types of Loans. If on or prior to the
first day of any Interest Period for any Eurodollar Loan:
(a) the Agent reasonably determines (which
determination shall be conclusive) that by reason of
circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Adjusted
Eurodollar Rate for such Interest Period; or
(b) the Required Lenders reasonably determine (which
determination shall be conclusive) and notify the Agent
that the Adjusted Eurodollar Rate will not adequately and
fairly reflect the cost to the Lenders of funding
Eurodollar Loans for such Interest Period;
then the Agent shall give the Borrower prompt notice thereof and
so long as such condition remains in effect, the Lenders shall
be under no obligation to make additional Eurodollar Loans,
Continue Eurodollar Loans, or to Convert Base Rate Loans into
Eurodollar Loans.
4.03 Illegality. Notwithstanding any other provision of
this Agreement, in the event that it becomes unlawful for any
Lender or its Applicable Lending Office to make, maintain, or
fund Eurodollar Loans hereunder, then such Lender shall promptly
notify the Borrower thereof and such Lender's obligation to make
or Continue Eurodollar Loans and to Convert Base Rate Loans into
Eurodollar Loans shall be suspended until such time as such
Lender may again make, maintain, and fund Eurodollar Loans (in
which case the provisions of Section 4.04 shall be applicable).
4.04 Treatment of Affected Loans. If the obligation of
any Lender to make a Eurodollar Loan or to Continue, or to
Convert Base Rate Loans into, Eurodollar Loans shall be
suspended pursuant to Section 4.01, 4.02 or 4.03 hereof (such
Eurodollar Loans being herein called "Affected Loans"), such
Lender's Affected Loans shall be automatically Converted into
Base Rate Loans on the last day(s) of the then current Interest
Period(s) for Affected Loans (or, in the case of a Conversion
required by Section 4.03 hereof, on such earlier date as such
Lender may specify to the Borrower with a copy to the Agent)
and, unless and until such Lender gives notice as provided below
that the circumstances specified in Section 4.01, 4.02 or 4.03
hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Affected Loans
have been so Converted, all payments and prepayments of
principal that would otherwise be applied to such Lender's
Affected Loans shall be applied instead to its Base Rate
Loans; and
(b) all Loans that would otherwise be made or
Continued by such Lender as Eurodollar Loans shall be made
or Continued instead as Base Rate Loans, and all Loans of
such Lender that would otherwise be Converted into
Eurodollar Loans shall be Converted instead into (or shall
remain as) Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the
Agent) that the circumstances specified in Section 4.01, 4.02 or
4.03 hereof that gave rise to the Conversion of such Lender's
Affected Loans pursuant to this Section 4.04 no longer exist
(which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be
automatically Converted, on the first day(s) of the next
succeeding Interest Period(s) for such outstanding Eurodollar
Loans made by other Lenders, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders
holding Eurodollar Loans and by such Lender are held pro rata
(as to principal amounts, Types, and Interest Periods) in
accordance with their respective Revolving Credit Commitment.
4.05 Compensation. Upon the request of any Lender, the
Borrower shall pay to such Lender such amount or amounts as
shall be sufficient (in the reasonable opinion of such Lender)
to compensate it for any loss, cost, or expense incurred by it
as a result of:
(a) any payment, prepayment, or Conversion of a Fixed
Rate Loan for any reason (including, without limitation,
the acceleration of the Loans pursuant to Section 9.01) on
a date other than the last day of the Interest Period for
such Loan; or
(b) any failure by the Borrower for any reason
(including, without limitation, the failure of any
condition precedent specified in Section 5.02 to be
satisfied) to borrow, Convert, Continue, or prepay a Fixed
Rate Loan on the date for such borrowing, Conversion,
Continuation, or prepayment specified in the relevant
Borrowing Notice, prepayment, Continuation, or Conversion
under this Agreement.
4.06 Taxes. (a) Any and all payments by the Borrower to
or for the account of any Lender or the Agent hereunder or under
any other Loan Document shall be made free and clear of and
without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding, in the case
of each Lender and the Agent, (i) taxes imposed on its income,
and franchise taxes imposed on it, by the jurisdiction under the
laws of which such Lender (or its Applicable Lending Office) or
the Agent (as the case may be) is organized or any political
subdivision thereof (ii) any taxes (other than withholding
taxes) that would not be imposed but for a connection between
the Agent or a Lender and the jurisdiction imposing such taxes
(other than a connection arising solely by virtue of the
activities of the Agent or such Lender pursuant to or in respect
of this Agreement or any other Loan Document), (iii) any
withholding taxes payable with respect to payments hereunder or
under any other Loan Document under applicable law in effect on
the date hereof, and (iv) and taxes arising after the date
hereof solely as a result of or attributable to a Lender
changing its Applicable Lending Office after the date such
Lender becomes a party hereto (all such non-excluded taxes,
duties, levies, imposts, deductions, charges, withholdings, and
liabilities being hereinafter referred to as "Taxes"). If the
Borrower shall be required by law to deduct any Taxes from or in
respect of any sum payable under this Agreement or any other
Loan Document to any Lender or the Agent, (i) the sum payable
shall be increased as necessary so that after making all
required deductions (including deductions applicable to
additional sums payable under this Section 4.06) such Lender or
the Agent receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower
shall make such deductions, (iii) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law, and (iv) the
Borrower shall furnish to the Agent, at its principal office,
the original or a certified copy of a receipt evidencing payment
thereof.
(b) In addition, the Borrower agrees to pay any and all
present or future stamp or documentary taxes and any other
excise or property taxes or charges or similar levies which
arise from any payment made under this Agreement or any other
Loan Document or from the execution or delivery of, or otherwise
with respect to, this Agreement or any other Loan Document
(hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Lender and the
Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed or asserted
by any jurisdiction on amounts payable under this Section 4.06)
paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto.
(d) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its
execution and delivery of this Agreement in the case of each
Lender listed on the signature pages hereof and on or prior to
the date on which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in writing
by the Borrower or the Agent (but only so long as such Lender
remains lawfully able to do so), shall provide the Borrower and
the Agent with (i) Internal Revenue Service Form 1001 or 4224,
as appropriate, or any successor form prescribed by the Internal
Revenue Service, certifying that such Lender is entitled to
benefits under an income tax treaty to which the United States
is a party which reduces the rate of withholding tax on payments
of interest or certifying that the income receivable pursuant to
this Agreement is effectively connected with the conduct of a
trade or business in the United States, (ii) Internal Revenue
Service Form W-8 or W-9, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and (iii) any other
form or certificate required by any taxing authority (including
any certificate required by Sections 871(h) and 881(c) of the
Internal Revenue Code), certifying that such Lender is entitled
to an exemption from or a reduced rate of tax on payments
pursuant to this Agreement or any of the other Loan Documents.
(e) For any period with respect to which a Lender has
failed to provide the Borrower and the Agent with the
appropriate form pursuant to Section 4.06(d) (unless such
failure is due to a change in treaty, law, or regulation
occurring subsequent to the date on which a form originally was
required to be provided), such Lender shall not be entitled to
indemnification under Section 4.06(a) or 4.06(b) with respect to
Taxes imposed by the United States; provided, however, that
should a Lender, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes because
of its failure to deliver a form required hereunder, the
Borrower shall take such steps as such Lender shall reasonably
request to assist such Lender to recover such Taxes.
(f) If the Borrower is required to pay additional amounts
to or for the account of any Lender pursuant to this Section
4.06, then such Lender will agree to use reasonable efforts to
change the jurisdiction of its Applicable Lending Office so as
to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such
Lender, is not otherwise disadvantageous to such Lender.
(g) Within thirty (30) days after the date of any payment
of Taxes, the Borrower shall furnish to the Agent the original
or a certified copy of a receipt evidencing such payment.
(h) Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 4.06 shall
survive the expiration or termination of this Agreement and
repayment in full of the Notes and all other Obligations and the
occurrence of the Total Facility Termination Date.
(i) Any Lender claiming additional amounts payable
pursuant to this Section 4.06 shall use reasonable efforts
(consistent with its internal policy and legal and regulatory
restrictions) to file any certificate or document requested by
the Borrower or to change the jurisdiction of its Applicable
Lending Office if the making of such filing or change would
avoid the need for or reduce the amount of any such additional
amounts which may thereafter accrue and would not, in the sole
judgment of such Lender, be disadvantageous to such Lender. The
Borrower shall promptly upon request by any Lender or the Agent
take all actions (including, without limitation, the completion
of forms and the provisions of information to the appropriate
taxing authorities) reasonably requested by such Lender or the
Agent to secure the benefit of any exemption from, or relief
with respect to, Taxes or Other Taxes in relation to any amounts
payable under this Agreement.
(j) In the event that an additional payment is made under
Section 4.06(a) or 4.06(c) for the account of any Lender and
such Lender, in its reasonable opinion, determines that it has
received or been granted a credit against or release or
remission for, or repayment of, any tax paid or payable by it in
respect of or calculated with reference to the deduction or
withholding giving rise to such payment, such Lender shall, to
the extent that it can do so without prejudice to the retention
of the amount of such credit, relief, remission or repayment,
pay to the Borrower such amount as such Lender shall reasonably
determine to be attributable to such deduction or withholding
and as will leave such Lender (after such payment) in no better
or worse position than it would have been in if the Borrower had
not been required to make such deduction or withholding.
ARTICLE V
Conditions to Making Loans
5.01 Conditions of Initial Loan. The obligation of the
Lenders to make the initial Loan is subject to the following
conditions precedent:
(a) The Agent shall have received on the Closing Date, in
form and substance satisfactory to the Agent and Lenders, or
otherwise be satisfied as to, each of the following:
(i) executed originals of each of this Agreement, the
Notes and the other Loan Documents, and the Five Year
Facility Credit Agreement and the promissory notes and loan
documents referred to therein, together with all schedules
and exhibits thereto;
(ii) favorable written opinions of special counsel or
in-house counsel to the Borrower and the Guarantors dated
the Closing Date, addressed to the Agent and the Lenders
and satisfactory to the Agent, the Lenders and to ▇▇▇▇▇
▇▇▇▇▇ Mulliss & ▇▇▇▇▇, L.L.P., special counsel to the
Agent, substantially in the form of Exhibit L attached
hereto and incorporated herein by reference;
(iii) Organizational Action of the Borrower and
each of the Guarantors certified by its secretary or
assistant secretary or other appropriate official as of the
Closing Date, appointing (in the case of the Borrower) the
initial Authorized Representatives and approving and
adopting the Loan Documents to be executed by such Person,
and authorizing the execution and delivery thereof and the
incurrence of obligations thereunder;
(iv) specimen signatures of officers of the Borrower
and each Guarantor executing the Loan Documents on behalf
of such Person, certified by the secretary or assistant
secretary or other appropriate official of the Borrower or
Guarantor, as applicable;
(v) the Organizational Documents of the Borrower and
each Guarantor certified as of a recent date by the
Secretary of State or other appropriate Governmental
Authority of its jurisdiction of incorporation (or other
organization, as applicable);
(vi) the Operating Documents of the Borrower and each
Guarantor certified as of the Closing Date as true and
correct by the secretary or assistant secretary or other
appropriate official of the Person to whom such Operating
Documents relate;
(vii) certificates issued as of a recent date by
the Secretary of State or other appropriate Governmental
Authority of its jurisdiction of incorporation (or other
organization, as applicable) as to the due existence and,
if issued by such governmental authority, good standing of
the Borrower and each Guarantor therein;
(viii) appropriate certificates of qualification to
do business, good standing and, where appropriate,
authority to conduct business under assumed name, issued in
respect of the Borrower and each Guarantor as of a recent
date by the Secretary of State or other appropriate
Governmental Authority of each jurisdiction in which the
failure to be qualified to do business or authorized so to
conduct business could reasonably be expected to have a
Material Adverse Effect;
(ix) notice of appointment of the initial Authorized
Representative of the Borrower in the form of Exhibit C
hereto;
(x) certificate of an Authorized Representative dated
the Closing Date demonstrating pro forma compliance with
the financial covenants contained in Sections 8.02 and
8.03, all as of May 2, 1998, substantially in the form of
Exhibit M attached hereto;
(xi) an initial Borrowing Notice;
(xii) all fees payable by the Borrower on the
Closing Date to the Agent, NationsBank, NMS and the
Lenders, including any upfront fee as agreed to in writing;
(xiii) historical pro forma consolidated financial
statements giving effect to the proposed combination with
Saks (the "Saks Acquisition") as set forth in the
Borrower's Registration Statement on Form S-4, Registration
No.333-60123, as filed with the Securities and Exchange
Commission on July 29, 1998 (the "Filing Date") as amended
by each amendment thereto (as so amended, the "Registration
Statement"), as well as the actual historical consolidated
financial statements of the Borrower and its Subsidiaries
incorporated by reference in such Registration Statement;
(xiv) certificate of an Authorized Representative
stating that all conditions precedent to the consummation
of the Saks Acquisition as set forth in the Agreement and
Plan of Merger dated as of July 4, 1998 (the "Saks
Acquisition Agreement") have been satisfied or waived;
(xv) fully executed copy of the Saks Acquisition
Agreement and other related documents, instruments and
agreements requested by the Agent, each certified as true
and complete by an Authorized Representative;
(xvi) evidence as to the termination of that
certain Credit Agreement among Saks, The Chase Manhattan
Bank, as Administrative Agent, and the other lenders party
thereto dated as of October 8, 1996 and repayment in full
of all obligations (other than the undrawn principal amount
of the letters of credit then outstanding listed on
Schedule 8.04 hereof) owing thereunder;
(xvii) a certificate of an Authorized
Representative as to the occurrence or truthfulness, as
applicable, of the matters set forth in Section 5.01(b)
hereof as of the Closing Date; and
(xviii) such other documents, instruments,
certificates and opinions as the Agent or any Lender may
reasonably request on or prior to the Closing Date in
connection with the consummation of the transactions
contemplated hereby.
(b) Each of the following shall have occurred or be true:
(i) there shall not be any action, suit,
investigation or proceeding pending or threatened by,
before or otherwise involving any Governmental Authority or
other Person that could reasonably be expected to have a
material adverse effect on (x) the business, business
prospects, results of operations or condition (financial or
otherwise) of the Borrower or its Subsidiaries or (y) the
ability of the Borrower or its Subsidiaries to observe and
perform the covenants and agreements contained herein or in
any other Loan Document or the ability of any Lender to
receive the benefit of any remedy provided thereto under
any Loan Document or (z) any transaction contemplated
hereby;
(ii) consummation of the Saks Acquisition, which shall
not have a Material Adverse Effect; and
(iii) the Borrower and its Subsidiaries shall be
in compliance with respect to all existing financial
obligations.
(c) In the good faith judgment of the Agent and the
Lenders:
(i) there shall not have occurred a material adverse
change since the Filing Date in the business, business
prospects, results of operations or condition (financial or
otherwise) of the Borrower and its Subsidiaries taken as a
whole or Saks and its Subsidiaries taken as a whole, or in
the facts and information regarding such entities as
represented to date;
(ii) the Agent and NMS shall have completed all due
diligence deemed necessary with respect to the business,
operations, financial condition and prospects of Saks and
its Subsidiaries; and
(iii) the Agent shall have received and reviewed,
with results satisfactory to the Agent and its counsel, all
information regarding litigation, tax, accounting, labor,
insurance, pension liabilities (actual or contingent), real
estate leases, material contracts, debt agreements,
property ownership, and contingent liabilities of the
Borrower and its Subsidiaries.
5.02 Conditions of Loans. The obligations of the Lenders
to make any Loan are subject to the satisfaction of the
following conditions (which are not applicable as conditions
precedent to any Loan being Continued or Converted pursuant to
Section 2.11 hereof).
(a) the Agent shall have received a notice of such
borrowing or request if required by Article II hereof;
(b) the representations and warranties of the Borrower and
each Guarantor set forth in Article VI hereof and in each of the
other Loan Documents shall be true and correct in all material
respects on and as of the date of such Loan with the same effect
as though such representations and warranties had been made on
and as of such date, other than such representations and warran-
ties which expressly relate to an earlier date, except that the
representations and warranties set forth in Section 6.01(d) and
(e) shall be deemed to include and take into account the Saks
Acquisition and any merger or consolidation permitted under
Section 8.08 hereof, and except that the financial statements
referred to in Section 6.01(f)(i) shall be deemed to be those
financial statements most recently delivered to the Agent and
the Lenders pursuant to Section 7.01 hereof;
(c) at the time of each such Loan, no Default or Event of
Default shall have occurred and be continuing and the
Obligations shall not have been declared to be immediately due
and payable pursuant to Section 9.01(A)(ii) hereof; and
(d) immediately after giving effect to any Loan (i)
Revolving Credit Outstandings shall not exceed the Total
Revolving Credit Commitment and (ii) each Lender's Applicable
Commitment Percentage of Revolving Credit Loans shall not exceed
its Revolving Credit Commitment.
ARTICLE VI
Representations and Warranties
6.01 Representations and Warranties. The Borrower
represents and warrants to the Lenders and the Agent with
respect to itself and to its Subsidiaries (which representations
and warranties shall survive the delivery of the documents
mentioned herein and the making of Loans), that:
(a) Organization and Authority.
(i) the Borrower and each Subsidiary is a legal
entity duly organized or created and validly existing under
the laws of the jurisdiction of its incorporation or
creation;
(ii) the Borrower and each Subsidiary (1) has the
requisite power and authority to own its properties and
assets and to carry on its business as now being conducted,
and (2) is qualified to do business in each jurisdiction in
which its ownership or lease of property or the nature of
its business makes such qualification necessary and in
which failure so to qualify could reasonably be expected to
have a Material Adverse Effect;
(iii) the Borrower has the power and authority to
execute, deliver and perform this Agreement and the Notes,
and to borrow hereunder, and to execute, deliver and
perform each of the other Loan Documents to which it is a
party;
(iv) each Guarantor has the power and authority to
execute, deliver and perform the Guaranty and the other
Loan Documents to which it is a party; and
(v) each of the Loan Documents to which a Loan Party
is a party has been duly executed and delivered by such
Loan Party and is the legal, valid and binding obligation
or agreement, as the case may be, of such Loan Party,
enforceable against such Loan Party in accordance with its
terms, subject to the effect of any applicable bankruptcy,
moratorium, insolvency, reorganization or other similar law
affecting the enforceability of creditors' rights generally
and to the effect of general principles of equity which may
limit the availability of equitable remedies (whether in a
proceeding at law or in equity);
(b) Loan Documents. The execution, delivery and
performance by a Loan Party of each of the Loan Documents to
which such Loan Party is a party:
(i) have been duly authorized by all requisite
Organizational Action (including any required shareholder
approval) of such Loan Party required for the lawful
execution, delivery and performance thereof;
(ii) do not violate any provisions of (1) applicable
law, rule or regulation, (2) any order of any court or
other agency of government binding on the Borrower or any
Guarantor, or their respective properties, or (3) the
Organizational Documents or Operating Documents of such
Loan Party;
(iii) will not be in conflict with, result in a
breach of or constitute an event of default, or an event
which, with notice or lapse of time, or both, would
constitute an event of default, under any indenture,
agreement or other instrument to which any Loan Party is a
party, or by which the properties or assets of any Loan
Party are bound; and
(iv) will not result in the creation or imposition of
any Lien, charge or encumbrance of any nature whatsoever
upon any of the properties or assets of any Loan Party
except any Liens in favor of the Agent and the Lenders
created by the Loan Documents;
(c) Solvency. Each Loan Party is Solvent after giving
effect to the Saks Acquisition and the transactions contemplated
by this Agreement and the other Loan Documents;
(d) Subsidiaries and Stockholders. Borrower has no
Subsidiaries other than those Persons listed as Subsidiaries in
Schedule 6.01(d) hereto (which Schedule includes all
Subsidiaries acquired in connection with the Saks Acquisition)
and Subsidiaries after the date hereof acquired or created in
compliance with Section 7.18 (if then applicable); Schedule
6.01(d) to this Agreement states as of the date hereof (i) with
respect to all wholly owned Subsidiaries, the names and owners
thereof and (ii) with respect to all non-wholly owned
Subsidiaries, the authorized and issued capitalization of each
such Subsidiary listed thereon, the number of shares or other
equity interests of each class of capital stock or interest
issued and outstanding of each such Subsidiary and the number
and/or percentage of outstanding shares or other equity interest
(including options, warrants and other rights to acquire any
interest) of each such class of capital stock or equity interest
owned by Borrower or by any such Subsidiary; the outstanding
shares or other equity interests of each Subsidiary have been
duly authorized and validly issued and are fully paid and non-
assessable; and Borrower and each such Subsidiary owns
beneficially and of record all the shares and other interests it
is listed as owning in Schedule 6.01(d) and all shares and other
interests for each of its wholly owned Subsidiaries, free and
clear of any Lien;
(e) Ownership Interests. Borrower owns no interest in any
Person other than as permitted under Section 8.07;
(f) Financial Condition.
(i) The Borrower has heretofore furnished to each
Lender (1) the audited income statement, balance sheet, and
statements of cash flow and changes in shareholders' equity
of the Borrower and its Subsidiaries (which do not give
effect to the Saks Acquisition) for the Fiscal Year ended
January 31, 1998 (the "Borrower's Audited Statements") and
(2) the unaudited pro forma condensed combined income
statements of the Borrower and its Subsidiaries (giving
effect to the Saks Acquisition) for the years ended
February 1, 1997 and January 31, 1998 and for the three-month
period ended May 2, 1998 and the unaudited pro forma
combined balance sheet of the Borrower and its Subsidiaries
as at May 2, 1998 (collectively, the "Combined Three Month
Statements"). Except as set forth therein, the Borrower's
Audited Statements present fairly, in all material
respects, the financial condition of the Borrower and its
Subsidiaries as of the Fiscal Year then ended and the
results of operations and changes in stockholders' equity
for the Fiscal Year then ended, all in conformity with
Generally Accepted Accounting Principles applied on a basis
consistent with prior periods. The Combined Three Month
Statements have been prepared by the Borrower and Saks,
based on their respective financial statements for such
periods and at such date together with available
information and certain assumptions which the Borrower
believes to be reasonable, and give pro forma effect to the
Saks Acquisition under the pooling-of-interest method of
accounting;
(ii) since the Filing Date, there has been no material
adverse change in the condition, financial or otherwise, of
the Borrower and its Subsidiaries taken as a whole or in
the businesses, properties and operations of the Borrower
and its Subsidiaries, considered as a whole, nor have such
businesses or properties, taken as a whole, been materially
adversely affected as a result of any fire, explosion,
earthquake, accident, strike, lockout, combination of
workers, flood, embargo or act of God;
(iii) except as set forth in the financial
statements referred to in Section 6.01(f)(i) or in Schedule
6.01(f) or Schedule 6.01(j) attached hereto, or as
permitted under Section 8.04 hereof or any other provision
of this Agreement or any other Loan Document, neither
Borrower nor any Subsidiary has incurred, other than in the
ordinary course of business, any material indebtedness,
obligations, commitments or other liability contingent or
otherwise which remain outstanding or unsatisfied;
(g) Title to Properties. The Borrower and its
Subsidiaries have title to all their respective owned real and
personal properties, subject to no Liens of any kind, except for
(i) the Liens described in Schedule 6.01(g) attached hereto and
(ii) Liens permitted under Section 8.05 hereof;
(h) Taxes. Except as set forth in Schedule 6.01(h)
attached hereto, the Borrower and its Subsidiaries have filed or
caused to be filed all federal, state, local and foreign tax
returns which are required to be filed by them and except for
taxes and assessments being contested as permitted under Section
7.04, have paid or caused to be paid all taxes as shown on said
returns or on any assessment received by them, to the extent
that such taxes have become due;
(i) Other Agreements. Neither the Borrower nor any
Subsidiary is
(i) a party to any judgment, order, decree or any
agreement or instrument or subject to restrictions which
could reasonably be expected to have a Material Adverse
Effect; or
(ii) in default in the performance, observance or
fulfillment of any of the obligations, covenants or
conditions contained in any agreement or instrument to
which the Borrower or any Subsidiary is a party, which
default has, or if not remedied within any applicable grace
period could reasonably be expected to have, a Material
Adverse Effect;
(j) Litigation. Except as set forth in Schedule 6.01(j)
attached hereto, there is no action, suit, litigation,
investigation or proceeding at law or in equity or by or before
any Governmental Authority pending, including without limitation
matters pertaining to labor, employment, wages, hours,
occupational safety and taxation, or, to the knowledge of the
Borrower, threatened by or against the Borrower or any
Subsidiary or affecting the Borrower or any Subsidiary or any
properties or rights of the Borrower or any Subsidiary, an
adverse ruling or determination in which could reasonably be
expected to have a Material Adverse Effect;
(k) Margin Stock. Neither the Borrower nor any agent
acting in its behalf has taken or will take any action which
might cause this Agreement or any of the documents or
instruments delivered pursuant hereto to violate any regulation
of the Board or to violate the Securities Exchange Act of 1934,
as amended, or the Securities Act of 1933, as amended, or any
state securities laws, in each case as in effect on the date
hereof;
(l) Investment Company. Neither the Borrower nor any
Subsidiary is an "investment company," or an "affiliated person"
of, or "promoter" or "principal underwriter" for, an "investment
company," as such terms are defined in the Investment Company
Act of 1940, as amended (15 U.S.C. Section 80a-1, et seq.). The
application of the proceeds of the Loans and repayment thereof
by the Borrower and the performance by the Borrower of the
transactions contemplated by this Agreement will not violate any
provision of said Act, or any rule, regulation or order issued
by the Securities and Exchange Commission thereunder, in each
case as amended from time to time;
(m) Patents, Etc. Except as set forth in Schedule 6.01(m)
attached hereto, the Borrower and its Subsidiaries own or have
the right to use, under valid license agreements or otherwise,
all material patents, licenses, franchises, trademarks,
trademark rights, trade names, trade name rights, trade secrets
and copyrights necessary to the conduct of their businesses as
now conducted, without known conflict with any patent, license,
franchise, trademark, trade secrets and confidential commercial
or proprietary information, trade name, copyright, rights to
trade secrets or other proprietary rights of any other Person,
except to the extent the failure to have such ownership or
rights could not reasonably be expected to have a Material
Adverse Effect;
(n) No Untrue Statement. Neither this Agreement nor any
other Loan Document or certificate or document executed and
delivered by or on behalf of any Loan Party in accordance with
or pursuant to any Loan Document contains any misrepresentation
or untrue statement of material fact or omits to state a
material fact necessary, in light of the circumstance under
which it was made, in order to make any such representation or
statement contained therein not misleading in any material
respect;
(o) No Consents, Etc. Except as set forth in Schedule
6.01(o) attached hereto, neither the respective businesses or
properties of the Borrower or any Subsidiary, nor any
relationship between the Borrower or any Subsidiary and any
other Person, nor any circumstance in connection with the
execution, delivery and performance of the Loan Documents and
the transactions contemplated hereby is such as to require a
consent, approval or authorization of, or filing, registration
or qualification with, any Governmental Authority on the part of
the Borrower or any Subsidiary as a condition to the execution,
delivery and performance of, or consummation of the transactions
contemplated by, this Agreement or the other Loan Documents or
if so, such consent, approval, authorization, filing,
registration or qualification has been obtained or effected, as
the case may be;
(p) Benefit Plans.
(i) None of the employee benefit plans maintained at
any time by the Borrower or any Subsidiary or the trusts
created thereunder has engaged in a prohibited transaction
or violated any Foreign Benefit Law which could subject any
such employee benefit plan or trust to a material tax or
penalty on prohibited transactions imposed under Internal
Revenue Code Section 4975 or ERISA or under any Foreign
Benefit Law;
(ii) None of the employee benefit plans maintained at
any time by the Borrower or any Subsidiary which are
employee pension benefit plans and which are subject to
Title IV of ERISA or any Foreign Benefit Law or the trusts
created thereunder has been terminated so as to result in
a material liability of the Borrower under ERISA or under
any Foreign Benefit Law nor has any such employee benefit
plan of the Borrower or any Subsidiary incurred any
material liability to the Pension Benefit Guaranty
Corporation established pursuant to ERISA or any other
Person exercising similar duties and functions under any
Foreign Benefit Law, other than for required insurance
premiums which have been paid or are not yet due and
payable; neither the Borrower nor any Subsidiary has
withdrawn from or caused a partial withdrawal to occur with
respect to any Multi-employer Plan resulting in any
material assessed and unpaid withdrawal liability; the
Borrower and the Subsidiaries have made or provided for all
contributions in all material amounts to all such employee
pension benefit plans which they maintain and which are
required as of the end of the most recent fiscal year under
each such plan; neither the Borrower nor any Subsidiary has
incurred any material accumulated funding deficiency with
respect to any such plan, whether or not waived; nor has
there been any reportable event, or other event or
condition, which presents a material risk of termination of
any such employee benefit plan by such Pension Benefit
Guaranty Corporation or any other Person exercising similar
duties and functions under any Foreign Benefit Law;
(iii) The present value of all vested accrued
benefits under the employee pension benefit plans which are
subject to Title IV of ERISA or any Foreign Benefit Law,
maintained by the Borrower or any Subsidiary, did not, as
of the most recent valuation date for each such plan,
exceed by a material amount the then current value of the
assets of such employee benefit plans allocable to such
benefits;
(iv) To the knowledge of the Borrower based on its
actual knowledge and based on information, if any, that the
Lenders may provide to the Borrower from time to time, the
consummation of the Loans provided for in Article II will
not involve any prohibited transaction under ERISA or any
Foreign Benefit Law which is not subject to a statutory or
administrative exemption;
(v) To the best of the Borrower's knowledge, each
employee pension benefit plan subject to Title IV of ERISA
or any Foreign Benefit Law, maintained by the Borrower or
any Subsidiary, has been administered in accordance with
its terms in all material respects and is in compliance in
all material respects with all applicable requirements of
ERISA and other applicable laws, regulations and rules and
any applicable Foreign Benefit Law;
(vi) There has been no material withdrawal liability
incurred and unpaid with respect to any Multi-employer
Plan to which the Borrower or any Subsidiary is or was
a contributor;
(vii) As used in this Agreement, the terms
"employee benefit plan," "employee pension benefit plan,"
"accumulated funding deficiency," "reportable event," and
"accrued benefits" shall have the respective meanings
assigned to them in ERISA, and the term "prohibited
transaction" shall have the meaning assigned to it in Code
Section 4975 and ERISA;
(viii) Neither the Borrower nor any Subsidiary has
any liability not disclosed on any of the financial
statements furnished to the Lenders pursuant to Section
7.01 hereof, contingent or otherwise, under any plan or
program or the equivalent for unfunded post-retirement
benefits, including pension, medical and death benefits,
which liability could reasonably be expected to have a
Material Adverse Effect;
(q) No Default. As of the date hereof, there does not
exist any Default or Event of Default hereunder;
(r) Environmental Matters. The Borrower and each
Subsidiary is in compliance with all applicable Environmental
Laws the failure of which to comply could reasonably be expected
to have a Material Adverse Effect and has been issued and
currently maintains all federal, state and local permits,
licenses, certificates and approvals the failure of which to
obtain or maintain could reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor any
Subsidiary has been notified of any material pending or
threatened action, suit, proceeding or investigation, and
neither the Borrower nor any Subsidiary is aware of any facts,
which (a) calls into question, or could reasonably be expected
to call into question, compliance by the Borrower or any
Subsidiary with any Environmental Laws, (b) seeks, or could
reasonably be expected to form the basis of a meritorious
proceeding, to suspend, revoke or terminate any license, permit
or approval necessary for the operation of the Borrower's or any
Subsidiary's business or facilities or for the generation,
handling, storage, treatment or disposal of any Hazardous
Materials, or (c) seeks to cause, or could reasonably be
expected to form the basis of a meritorious proceeding to cause,
any property of the Borrower or any Subsidiary to be subject to
any restrictions on ownership, use, occupancy or transferability
under any Environmental Law, in each case which could reasonably
be expected to have a Material Adverse Effect;
(s) RICO. Neither the Borrower nor any Subsidiary is
engaged in or has engaged in any course of conduct that could
subject any of their respective properties to any Lien, seizure
or other forfeiture under any criminal law, racketeer influenced
and corrupt organizations law, civil or criminal, or other
similar laws;
(t) Compliance with Laws. The Borrower and each
Subsidiary is in compliance with all laws, rules and
regulations, and all applicable laws, rules and regulations
pertaining to labor or employment matters, including without
limitation those pertaining to wages, hours, occupational safety
and taxation and all other valid requirements of any
Governmental Authority with respect to the conduct of its
business, the noncompliance with which could reasonably be
expected to have a Material Adverse Effect.
(u) Year 2000 Compliance. The Borrower has (i) initiated
a review and assessment of all areas within its and each of its
Subsidiaries' business and operations (including those affected
by suppliers, vendors and customers) that could reasonably be
expected to be adversely affected by the "Year 2000 Problem"
(that is, the risk that computer hardware and software
applications used by the Borrower or any of its Subsidiaries (or
material suppliers, vendors and customers) may be unable to
recognize and perform properly date-sensitive functions
involving certain dates prior to and any date after December 31,
1999), (ii) developed a plan and time line for addressing the
Year 2000 Problem on a timely basis, and (iii) to date,
implemented that plan in accordance with that timetable. Based
on the foregoing, the Borrower believes that all computer
hardware and software applications (including those of its
suppliers, vendors and customers) that are material to its or
any of its Subsidiaries' business and operations are reasonably
expected on a timely basis to be able to perform properly
date-sensitive functions for all dates before and after January 1,
2000 (that is, be "Year 2000 Compliant"), except to the extent
that a failure to do so could not reasonably be expected to have
a Material Adverse Effect.
ARTICLE VII
Affirmative Covenants
Until the occurrence of the Total Facility Termination
Date, unless the Required Lenders shall otherwise consent in
writing, the Borrower will:
7.01 Financial Reports, Etc. (a) as soon as practicable
and in any event within ninety-five (95) days after the end of
each Fiscal Year of the Borrower, deliver or cause to be
delivered to the Agent and each Lender (i) the consolidated
balance sheets of the Borrower and its Subsidiaries, in each
case with the notes thereto, the related consolidated statements
of operations, cash flow, and shareholders' equity and the
respective notes thereto for such Fiscal Year, setting forth in
the case of the consolidated statements comparative financial
statements for the preceding Fiscal Year, all prepared in
accordance with Generally Accepted Accounting Principles applied
on a Consistent Basis and containing, with respect to the
consolidated financial reports, an opinion of
PriceWaterhouseCoopers LLP, or any other "Big 5" accounting firm
or other such independent certified public accountants of
recognized national standing selected by the Borrower and
approved by the Agent, which is unqualified and devoid of any
exception which is not acceptable to the Required Lenders; and
(ii) a certificate of an Authorized Representative as to the
existence or non-existence of any Default or Event of Default,
demonstrating compliance with Sections 8.01, 8.02 and 8.03 of
this Agreement as of the end of the most recent Fiscal Year for
which such covenant compliance is demonstrated, which
certificate shall be substantially in the form attached hereto
as Exhibit L and incorporated herein by reference;
(b) as soon as practicable and in any event within fifty
(50) days after the end of each quarterly period of each Fiscal
Year (except the last reporting period of the Fiscal Year), or
if an extension has been granted by the Securities and Exchange
Commission for the filing by the Borrower of its quarterly
report on Form 10-Q, then by the earlier of the date such Form
10-Q is actually filed and the last day of such extended time
period, but in no event later than sixty (60) days after the end
of such quarterly period for which such Form 10-Q is to be
filed, deliver to the Agent and each Lender (i) the consolidated
balance sheets of the Borrower and its Subsidiaries, in each
case as of the end of such reporting period, the related
consolidated statements of operations and cash flow for such
reporting period and for the period from the beginning of the
Fiscal Year through the end of such reporting period,
accompanied by a certificate of an Authorized Representative to
the effect that such financial statements present fairly, in all
material respects, the financial position of the Borrower and
its Subsidiaries as of the end of such reporting period and the
results of their operations and the changes in their financial
position for such reporting period, all of such interim
financial statements being prepared on a consolidated basis in
accordance with Generally Accepted Accounting Principles applied
on a Consistent Basis, subject to normal year-end audit
adjustments, and (ii) a certificate of an Authorized
Representative as to the existence or non-existence of any
Default or Event of Default and containing computations for such
quarter comparable to that required pursuant to Section
7.01(a)(ii);
(c) together with each delivery of the financial
statements required by Section 7.01(a)(i) hereof, deliver to the
Agent and each Lender a letter from the Borrower's accountants
specified in Section 7.01(a)(i) hereof stating that in
performing the audit necessary to render an opinion on the
financial statements delivered under Section 7.01(a)(i), they
obtained no knowledge of any Default or Event of Default by the
Borrower in the fulfillment of the terms and provisions of this
Agreement insofar as they relate to financial matters (which at
the date of such statement remains uncured); and if the
accountants have obtained knowledge of such Default or Event of
Default, a statement specifying the nature and period of
existence thereof;
(d) promptly upon their becoming available to the
Borrower, the Borrower shall deliver to the Agent and each
Lender a copy of (i) all regular or special reports or effective
registration statements which Borrower or any Subsidiary shall
file with the Securities and Exchange Commission (or any
successor thereto) or any securities exchange, and (ii) any
proxy statement distributed by the Borrower to its shareholders,
bondholders or the financial community in general;
(e) promptly, and in any event within two (2) Business
Days, after the public announcement of any change in the Debt
Rating, deliver written notice to the Agent of such new Debt
Rating and the Debt Rating Date. The Borrower shall also
provide such additional evidence of such new Debt Rating as may
be requested by the Agent, including without limitation evidence
from either or both of S&P and ▇▇▇▇▇'▇ (or such other
Alternative Rating Agency), as applicable, within ten (10)
Business Days of such request;
(f) no later than 75 calendar days following the
consummation of the Saks Acquisition, deliver to the Agent and
each Lender a copy of the Audited Restated Financial Statements;
and
(g) promptly, from time to time, deliver or cause to be
delivered to the Agent and each Lender such other information
regarding Borrower's and each Subsidiary's operations, business
affairs and financial condition as the Agent or such Lender may
reasonably request.
7.02 Maintain Properties. (i) Maintain all properties
necessary to its operations in good working order and condition
(ordinary wear and tear excepted) and make all needed repairs,
replacements and renewals as are necessary to conduct its
business in accordance with customary business practices and
(ii) preserve and protect its material patents, copyrights,
licenses, trademarks, trademark rights, trade names, trade name
rights, trade secrets and know-how necessary or useful in the
conduct of its operations.
7.03 Existence, Qualification, Etc. Do or cause to be
done all things necessary to preserve and keep in full force and
effect its existence and all material rights and franchises,
trade names, trademarks and permits, except to the extent
conveyed in connection with transactions permitted under
Sections 8.06 or 8.08 hereof, and maintain its license or
qualification to do business as a foreign corporation and good
standing in each jurisdiction in which its ownership or lease of
property or the nature of its business makes such license or
qualification necessary and in which the failure so to qualify
could reasonably be expected to have a Material Adverse Effect.
7.04 Taxes. Pay all taxes, assessments, governmental
charges, claims for labor, supplies, rent and any other
obligation which, if unpaid, might become a Lien against any of
its properties except any of the foregoing being contested in
good faith by appropriate proceedings diligently conducted and
against which reserves sufficient under GAAP have been
established.
7.05 Insurance. (i) Maintain insurance with responsible
insurance carriers against loss or damage by fire and other
hazards as are customarily insured against by similar businesses
owning such properties similarly situated, (ii) maintain general
public liability insurance at all times with responsible
insurance carriers against liability on account of damage to
persons and property having such limits, deductibles, exclusions
and co-insurance and other provisions providing no less coverage
than insurance customarily carried by similar businesses owning
similar properties and conducting similar operations, and (iii)
maintain insurance under all applicable workers' compensation
laws (or in the alternative, maintain required reserves if
self-insured for workers' compensation purposes).
7.06 True Books. Keep true books of record and account in
compliance with Generally Accepted Accounting Principles.
7.07 Right of Inspection. Permit any Lender or the Agent
(through their employees and other agents), at the expense of
such Lender or the Agent, as applicable, or at the reasonable
expense of the Borrower if a Default has occurred and is
continuing, to visit and inspect any of the properties (subject
to the rights of third party tenants in possession), corporate
books and financial reports of the Borrower and its
Subsidiaries, and to discuss their respective affairs, finances
and accounts with their principal officers and independent
certified public accountants, all at reasonable times, at
reasonable intervals and with reasonable prior notice.
7.08 Observe All Laws; Licenses. Comply in all material
respects with all laws, rules and regulations and all other
valid requirements of any Governmental Authority with respect to
the conduct of its business, including without limitation
Environmental Laws, the noncompliance with which could
reasonably be expected to have a Material Adverse Effect.
Borrower shall also obtain and maintain all licenses, permits,
certifications and approvals of all applicable Governmental
Authorities as are required for the conduct of its business as
currently conducted and as contemplated by the Loan Documents
and with respect to which the failure to so obtain and maintain
could reasonably be expected to have a Material Adverse Effect.
7.09 Covenants Extending to Subsidiaries. Cause each of
its Subsidiaries to do with respect to itself, its business and
its assets, each of the things required of the Borrower in
Sections 7.02 through 7.08, inclusive.
7.10 Officer's Knowledge of Default. Upon any Authorized
Representative of the Borrower obtaining knowledge of any
Default or Event of Default, promptly notify the Agent of the
nature thereof, the period of existence thereof, and what action
the Borrower proposes to take with respect thereto and stating
that such notice is a "notice of default."
7.11 Suits or Other Proceedings. Upon any Authorized
Representative of the Borrower obtaining knowledge of any
litigation or other proceeding being instituted against the
Borrower or any Subsidiary, or any attachment, levy, execution
or other process being instituted against any assets of the
Borrower or any Subsidiary, in an aggregate amount greater than
$10,000,000 not otherwise covered by insurance, promptly deliver
to the Agent written notice thereof stating the nature and
status of such litigation, proceeding, levy, execution or other
process.
7.12 Notice of Discharge of Hazardous Material or
Environmental Complaint. Promptly provide to the Agent true,
accurate and complete copies of any and all written notices,
complaints, orders, directives, claims, or citations received by
the Borrower or any Subsidiary relating to any of the following,
in each case which could reasonably be expected to have a
Material Adverse Effect: (a) violation or alleged violation by
the Borrower or any Subsidiary of any applicable Environmental
Laws; (b) release or threatened release by the Borrower or any
Subsidiary, or by any Person handling, transporting or disposing
of any Hazardous Material on behalf of the Borrower or any
Subsidiary, or at any facility or property owned or leased or
operated by the Borrower or any Subsidiary, of any Hazardous
Material, except where occurring legally pursuant to a permit or
license or otherwise; or (c) liability or alleged liability of
the Borrower or any Subsidiary for the costs of cleaning up,
removing, remediating or responding to a release of Hazardous
Materials.
7.13 Environmental Compliance. If the Borrower or any
Subsidiary shall receive any letter, notice, complaint, order,
directive, claim or citation from any Governmental Authority
alleging that the Borrower or any Subsidiary has violated any
applicable Environmental Law, released any Hazardous Material,
or is liable for the costs of cleaning up, removing, remediating
or responding to a release of Hazardous Materials, in each case
the violation or occurrence of which could reasonably be
expected to have a Material Adverse Effect, the Borrower shall
promptly (and in any event within the time period permitted and
to the extent required by the applicable Environmental Law or by
the applicable Governmental Authority responsible for enforcing
such Environmental Law) remove or remedy, or cause the
applicable Subsidiary to remove or remedy, such violation or
release or satisfy such liability.
7.14 Year 2000 Notice. Notify the Agents and the Lenders
in the event the Borrower discovers or determines that any
computer application (including those of its suppliers, vendors
and customers) that is material to its or any of its
Subsidiaries' business and operations will not be Year 2000
Compliant by September 30, 1999, except to the extent that such
failure could not reasonably be expected to result in a Material
Adverse Effect.
7.15 Further Assurances. At its cost and expense, upon
request of the Agent, duly execute and deliver or cause another
Loan Party to duly execute and deliver, to the Agent such
further instruments, documents, certificates, and agreements,
and do and cause another Loan Party to do such further acts
that may be reasonably necessary or advisable in the reasonable
opinion of the Agent to carry out the provisions and purposes of
this Agreement and the other Loan Documents.
7.16 Benefit Plans. Comply in all material respects with
all requirements of ERISA and any Foreign Benefit Law applicable
to it and furnish to the Agent as soon as possible and in any
event (i) within thirty (30) days after the Borrower knows or
has reason to know that any reportable event or other event
under any Foreign Benefit Law with respect to any employee
benefit plan maintained by the Borrower or any Subsidiary which
could give rise to termination or the imposition of any material
tax or penalty has occurred, written statement of an Authorized
Representative describing in reasonable detail such reportable
event or such other event and any action which the Borrower or
applicable Subsidiary proposes to take with respect thereto,
together with a copy of the notice of such reportable event
given to the Pension Benefit Guaranty Corporation or to any
other applicable Person exercising similar duties and functions
under any Foreign Benefit Law or a statement that said notice
will be filed with the annual report of the United States
Department of Labor with respect to such plan if such filing has
been authorized, (ii) promptly after receipt thereof, a copy of
any notice that the Borrower or any Subsidiary may receive from
the Pension Benefit Guaranty Corporation or from any other
Person exercising similar duties and functions under any Foreign
Benefit Law relating to the intention of the Pension Benefit
Guaranty Corporation or any such Person to terminate any
employee benefit plan or plans of the Borrower or any Subsidiary
or to appoint a trustee to administer any such plan, (iii)
within 10 days after a filing with the Pension Benefit Guaranty
Corporation pursuant to Section 412(n) of the Code or with any
Person pursuant to any Foreign Benefit Law of a notice of
failure to make a required installment or other payment with
respect to a plan, a certificate of an Authorized Representative
setting forth details as to such failure and the action that the
Borrower or its affected Subsidiary, as applicable, proposes to
take with respect thereto, together with a copy of such notice
given to the Pension Benefit Guaranty Corporation or to such
Person, and (iv) promptly after the incurrence thereof and in
any event within 10 days, notice of withdrawal by the Borrower
or any Subsidiary from any Multi-employer Plan which withdrawal
could reasonably result in a material withdrawal liability.
7.17 Continued Operations. Continue at all times to
conduct its business and engage principally in a line or lines
of business similar to the business substantially as conducted
on the Closing Date by the Borrower and its Subsidiaries
(subject to the right to dispose of assets in transactions
permitted under Section 8.06 hereof).
7.18 New Subsidiaries.
(a) Subject to subsection (c) below, not later than forty-five
(45) Business Days following the acquisition or creation of
any Material Subsidiary (other than a Foreign Subsidiary), or
upon any previously existing Person becoming a Material
Subsidiary (other than a Foreign Subsidiary), cause to be
delivered to the Agent for the benefit of the Lenders each of
the following:
(i) a Guarantor Joinder Agreement executed by such
Subsidiary, with appropriate insertions of identifying
information and such other changes to which the Agent may
consent in its discretion;
(ii) an opinion of counsel to such Subsidiary dated as
of the date of delivery of the Guarantor Joinder Agreement
provided in the foregoing clause (i) and addressed to the
Agent and the Lenders, in form and substance substantially
similar to the opinions of counsel to the Guarantors
delivered on the Closing Date to the Lenders pursuant to
Section 5.01 hereof; and
(iii) current copies of the Organizational
Documents and Operating Documents of such Subsidiary,
minutes of duly called and conducted meetings (or duly
effected consent actions) of the Board of Directors (or
other comparable group of individuals performing a similar
function), or appropriate committees thereof (and, if
required by such Organizational Documents or Operating
Documents or by applicable laws, of the shareholders) of
such Subsidiary authorizing the actions and the execution
and delivery of documents described in clause (i) of this
Section 7.18 and evidence satisfactory to the Agent
(confirmation of the receipt of which will be provided by
the Agent to the Lenders) that such Subsidiary is Solvent
as of such date and after giving effect to the Guaranty.
(b) Subject to subsection (c) below, not later than forty-five
(45) Business Days following the acquisition or creation of
a Foreign Subsidiary which is a Material Subsidiary, or upon any
previously existing Person becoming a Foreign Subsidiary which
is a Material Subsidiary, cause to be delivered to the Agent for
the benefit of the Lenders each of the following:
(i) a pledge agreement (the "Pledge Agreement") to be
entered into by the Borrower or Subsidiary owning any or
all of the capital stock or other ownership interest of
such Foreign Subsidiary (the "Pledgor") in form and
substance acceptable to the Agent pledging 65% of all such
capital stock or ownership interests (the "Pledged Stock");
(ii) the certificates evidencing the Pledged Stock
together with duly executed stock powers or powers of
assignment in blank affixed thereto;
(iii) an opinion of counsel to the Pledgor dated
as of the date of delivery of the Pledge Agreement provided
in the foregoing clause (i) and addressed to the Agent and
the Lenders as to matters regarding the enforceability of
such Pledge Agreement and the status of such Pledged Stock
in form and substance acceptable to the Agent; and
(iv) the items referred to in (a)(iii) above with
respect to the Pledgor.
(c) This Section shall be of no further force or effect if
the Guaranty has been terminated in accordance with Section
11.20 hereof.
ARTICLE VIII
Negative Covenants
Until the occurrence of the Total Facility Termination
Date, unless the Required Lenders shall otherwise consent in
writing, the Borrower will not, nor will it permit any
Subsidiary to:
8.01 Consolidated Net Worth. Permit Consolidated Net
Worth at any time to be less than (A) the amount equal to
ninety percent (90%) of the Borrower's Consolidated Net Worth as
of November 1, 1998 after completion of the Saks Acquisition
plus (B) an amount equal to one hundred percent (100%) of the
Net Proceeds of each sale of capital stock or other equity
interest (including those instruments and securities
exchangeable, convertible or exercisable into capital stock or
other equity interests at such time as such instruments are
recognizable in Consolidated Net Worth in accordance with GAAP)
in the Borrower or any Subsidiary after November 1, 1998 plus
(C) an amount equal to the sum of fifty percent (50%) of
Consolidated Net Income of the Borrower and its Subsidiaries
(without deduction for any negative Consolidated Net Income) for
each full fiscal quarter ending after November 1, 1998.
8.02 Consolidated Fixed Charge Ratio. Permit, at the end
of any Four-Quarter Period of the Borrower, the Consolidated
Fixed Charge Ratio for such Four-Quarter Period to be equal to
or less than 1.50 to 1.00.
8.03 Consolidated Funded Total Indebtedness to
Consolidated EBITDA. Permit, at the end of any Four-Quarter
Period of the Borrower, the ratio of Consolidated Funded Total
Indebtedness to Consolidated EBITDA for such Four-Quarter Period
to be greater than 3.50 to 1.00.
8.04 Indebtedness. (a) Incur, create, assume or permit to
exist any Indebtedness, howsoever evidenced, except
(i) All Indebtedness existing as of the date hereof
(including Indebtedness of Saks and its Subsidiaries as of
the date hereof, other than Indebtedness incurred in
anticipation of the Saks Acquisition and Indebtedness which
must be repaid pursuant to Section 5.01(a)(xvi)) and set
forth in Schedule 8.04 attached hereto and incorporated
herein by reference and any extension, renewal or
refinancing thereof that does not increase the principal
amount thereof from that existing immediately prior to such
extension, renewal or refinancing; and that does not result
in an interest rate which is greater than the market rate
generally available to companies similarly situated to the
Borrower for similar transactions; provided, none of the
instruments and agreements evidencing or governing such
Indebtedness (including extensions, renewals and
refinancings thereof) shall be amended, modified or
supplemented after the Closing Date (nor shall any new or
other documents be entered into which are effective) to
change any terms of repayment, subordination with respect
to the Obligations, restrictions against incurring Liens or
Indebtedness, rights of conversion, put or exchange,
mandatory prepayment, reduction in commitment or addition
of or adverse change in any borrowing base with respect to
such Indebtedness from such terms and rights as in effect
on the Closing Date unless such amendments, modifications
or supplements (or new or other documents) would not
reasonably be expected to have an adverse effect on the
Borrower, or its creditworthiness with respect to its
Obligations;
(ii) Indebtedness owing to the Agent or any Lenders in
connection with this Agreement, any Note or other Loan
Document;
(iii) Indebtedness consisting of Rate Hedging
Obligations permitted under Section 8.13 hereof;
(iv) The endorsement of negotiable instruments for
deposit or collection or similar transactions in the
ordinary course of business;
(v) Indebtedness incurred directly by the Borrower or
any Subsidiary exclusively to finance machinery, equipment
and other fixed assets purchased after the Closing Date and
Indebtedness incurred after the Closing Date and secured by
the Borrower's or any Subsidiary's real property (including
without limitation, Indebtedness secured in connection
with any tax retention operating leases and synthetic
leases), provided that such Indebtedness (i) is secured, if
at all, solely by a Lien permitted in accordance with
Sections 8.05(iii) or (vii) hereof, as applicable, (ii)
shall not be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of
such refinancing and (iii) does not, at the time of
incurrence, in the aggregate during any consecutive twelve
month period for the Borrower and all Subsidiaries exceed
a principal amount equal to five percent (5%) of
Consolidated Net Worth (calculated as of the most recent
fiscal period with respect to which the Agent shall have
received the Required Financial Information);
(vi) Indebtedness of any Subsidiary owing to the
Borrower or a Subsidiary and Indebtedness of the Borrower
owing to a Subsidiary;
(vii) Additional Indebtedness of the Borrower and
its Subsidiaries, including without limitation Indebtedness
related to commercial and documentary letters of credit,
standby letters of credit, or otherwise, provided that (i)
the affirmative and negative covenants and events of
default contained in the documents evidencing such
additional Indebtedness are not materially more restrictive
than those contained in the Loan Documents, (ii) neither a
Default nor Event of Default exists at the time such
additional Indebtedness is incurred or would result from
the incurrence of such additional Indebtedness and (iii) in
the event such additional Indebtedness matures or requires
any principal payment, including pursuant to acceleration,
or mandatory prepayment or redemption, on or prior to the
Total Facility Termination Date, the aggregate amount
outstanding of such additional Indebtedness which is due
(either at maturity or as a principal payment) prior to the
Total Facility Termination Date shall not at any time (as
determined by the face amount of such Indebtedness where
applicable) exceed fifteen percent (15%) of Consolidated
Total Assets (calculated as of the most recent fiscal
period with respect to which the Agent shall have received
the Required Financial Information); and
(viii) Any guaranty of Indebtedness of the Borrower
or any Guarantor which is permitted to be incurred pursuant
to this Section 8.04.
(b) Permit at any time the amount of Indebtedness of all
Subsidiaries (excluding Securitization Subsidiaries and Saks
REMIC Subsidiaries) in the aggregate to exceed ten percent (10%)
of Consolidated Net Worth (calculated as of the most recent
fiscal period with respect to which the Agent shall have
received the Required Financial Information); provided, prior to
the Borrower's achievement of an Investment Grade Rating and the
release of the Guaranty pursuant to Section 11.20, this
limitation shall only apply to Subsidiaries (other than
Securitization Subsidiaries and Saks REMIC Subsidiaries) which
are not Guarantors.
8.05 Liens. Incur, create or permit to exist any Lien
with respect to any property or assets now owned or hereafter
acquired by the Borrower or any of its Subsidiaries, other than
(i) Liens existing as of the date hereof and as set
forth in Schedule 6.01(g) attached hereto;
(ii) Liens imposed by law for taxes, assessments or
charges of any Governmental Authority for claims not yet
due or which are being contested in good faith by
appropriate proceedings diligently conducted and with
respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with
Generally Accepted Accounting Principles;
(iii) Liens in respect of purchase money Indebtedness
in connection with the acquisition of machinery, equipment
and other fixed assets permitted to be incurred pursuant to
Section 8.04(v) hereof; provided that (a) the original
principal balance of the Indebtedness secured by such Lien
constitutes not less than 75% and not more than 100% of the
purchase price of the property acquired and (b) such Lien
extends only to the property acquired with the proceeds of
the indebtedness so secured;
(iv) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and other
Liens imposed by law or created in the ordinary course of
business and in existence less than 120 days from the date
of creation thereof for amounts not yet due or which are
being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate
reserves or other appropriate provisions are being
maintained in accordance with Generally Accepted Accounting
Principles;
(v) Liens incurred or deposits made in the ordinary
course of business (including, without limitation, surety
bonds and appeal bonds) in connection with workers'
compensation, unemployment insurance and other types of
social security benefits or to secure the performance of
tenders, bids, leases, contracts (other than for the
repayment of Indebtedness), statutory obligations and other
similar obligations or arising as a result of progress
payments under government contracts;
(vi) easements (including, without limitation,
reciprocal easement agreements and utility agreements),
rights-of-way, covenants, consents, reservations,
encroachments, variations and zoning and other
restrictions, charges or encumbrances (whether or not
recorded), which do not interfere materially with the
ordinary conduct of the business of the Borrower or any
Subsidiary and which do not materially detract from the
value of the property to which they attach or materially
impair the use thereof by the Borrower or any Subsidiary;
(vii) Liens on real property securing Indebtedness
permitted under Section 8.04(v) hereof;
(viii) Liens on specific items of inventory of the
Borrower or any Subsidiary granted to secure reimbursement
obligations incurred with respect to documentary letters of
credit issued in connection with the purchase of such
inventory; provided such liens at all times remain
unperfected and no such lien attaches to inventory not
acquired with the credit support of such documentary letter
of credit; and
(ix) Liens arising out of the refinancing, extension,
renewal or refunding of any Indebtedness secured by any
Lien permitted by this Section 8.05 to the extent such
Liens are attached to the same property previously
encumbered as collateral for such Indebtedness or for any
other previously existing Indebtedness so refinanced,
extended, renewed or refunded at such time.
8.06 Transfer of Assets. Other than as permitted in
Section 8.08 hereof, sell, lease, transfer or otherwise dispose
of any assets (including without limitation capital stock or
similar ownership interests transferred by way of merger or
other consolidation) of the Borrower or any Subsidiary during
any Fiscal Year unless the sum of (i) the aggregate book value
of such assets to be so disposed and previously disposed during
such Fiscal Year plus (ii) the book value of the total assets of
each Subsidiary party to a merger during such Fiscal Year in
which the survivor is not or does not become a Subsidiary and
which is otherwise permitted under Section 8.08(ii) hereof plus
(iii) the book value of assets allocated or to be distributed
during such Fiscal Year to a Person other than the Borrower or
a wholly owned Subsidiary in the event of a dissolution of a
Subsidiary which is not wholly owned by the Borrower and which
is otherwise permitted under Section 8.12(iii) hereof, in the
aggregate for (i), (ii) and (iii) does not exceed fifteen
percent (15%) of the book value of the Consolidated Total Assets
as at the last day of the immediately preceding Fiscal Year;
provided, however, such determination shall be made on a
noncumulative basis, with the effect that the amount of assets
not disposed of in one Fiscal Year may not be carried forward
and disposed of in a subsequent Fiscal Year and such
determination shall be made with respect to the Audited Restated
Financial Statements until delivery of the audited financial
statements pursuant to Section 7.01(a) for Fiscal Year 1998.
The foregoing limitation shall not apply to any of the
following: (a) sales of assets in the ordinary course of
business; (b) transfers of assets among the Borrower and its
Subsidiaries, including transfers of accounts receivable to a
Securitization Subsidiary, subject to compliance with Section
7.18 hereof after giving effect to any such transfer; and (c)
sales of assets with respect to which the Net Proceeds are
applied within 180 days of receipt thereof to make Permitted
Acquisitions or to acquire, construct or improve properties, or
capital assets, in each case, to be used in a line or lines of
business consistent with the terms of Section 7.17 hereof.
8.07 Investments; Acquisitions. Purchase, own, invest in
or otherwise acquire, directly or indirectly, any stock or other
securities of, or all or substantially all of the assets of, or
make or permit to exist any interest whatsoever in, any other
Person or otherwise make any Acquisition or permit to exist any
loans or advances to any Person, except that Borrower and its
Subsidiaries may maintain investments or invest in:
(i) Eligible Securities;
(ii) investments existing as of the date hereof;
(iii) accounts receivable arising and trade credit
granted in the ordinary course of business and any
securities received in satisfaction or partial satisfaction
thereof in connection with accounts of financially troubled
Persons to the extent reasonably necessary in order to
prevent or limit loss;
(iv) loans and advances to and investments in
Subsidiaries which are Guarantors;
(v) loans and advances to its officers, directors and
employees for travel expenses incurred in the ordinary
course of business without limitation and for any other
business purpose in an aggregate principal amount at any
time outstanding not to exceed $25,000,000;
(vi) other investments in an aggregate amount at any
time outstanding not to exceed 5% of Consolidated Net Worth
(calculated as of the most recent fiscal period with
respect to which the Agent shall have received the Required
Financial Information);
(vii) Permitted Acquisitions and other mergers
permitted in Section 8.08 hereof; and
(viii) Securitization Subsidiaries of the Borrower
in an aggregate amount not to exceed 10% of Consolidated
Net Worth (calculated as of the most recent fiscal period
with respect to which the Agent shall have received the
Required Financial Information); provided further,
investments made in Securitization Subsidiaries on or
prior to the date hereof and the retained earnings of
Securitization Subsidiaries as of the date hereof and
subsequent thereto may be transferred between
Securitization Subsidiaries or between the Borrower and a
Securitization Subsidiary without limitation.
8.08 Merger or Consolidation. Consolidate with or merge
into any other Person, or permit any other Person to merge into
it; provided, however, subject to compliance with the other
terms and conditions of this Agreement, including without
limitation Sections 7.18 and 8.06 hereof after giving effect to
any of the following transactions, (i) any Subsidiary of the
Borrower may merge into or consolidate with the Borrower or any
other Subsidiary, (ii) any Subsidiary may merge into another
Person whereby such other Person is the surviving corporation
and (iii) in connection with any Permitted Acquisition, any
Person may merge with the Borrower or any Subsidiary if the
Borrower or such Subsidiary, as applicable, shall be the
surviving corporation.
8.09 Transactions with Affiliates. Other than
transactions permitted under Section 8.07 hereof, enter into any
transaction (or series of related transactions) after the
Closing Date, with, or for the benefit of, any Affiliate of the
Borrower or any officer or director of the Borrower or any
Subsidiary (each, an "Affiliate Transaction"), unless (i) such
Affiliate Transaction is pursuant to the reasonable requirements
of the Borrower's or such Subsidiary's business and is for the
purchase or sale of goods or receipt or delivery of services on
terms that are no less favorable to the Borrower or the
Subsidiary, as the case may be, than those which could have been
obtained in a comparable transaction at such time from Persons
who do not have such a relationship or (ii) such Affiliate
Transaction is with a wholly owned Subsidiary (other than a
Foreign Subsidiary) of the Borrower.
8.10 Benefit Plans. With respect to all employee pension
benefit plans maintained by the Borrower or any Subsidiary:
(i) terminate any of such employee pension benefit
plans so as to incur any material liability to the Pension
Benefit Guaranty Corporation established pursuant to ERISA
or to any other Person exercising similar duties and
functions under any Foreign Benefit Law;
(ii) allow or suffer to exist any prohibited
transaction involving any of such employee pension benefit
plans or any trust created thereunder which would subject
the Borrower or a Subsidiary to a material tax or material
penalty or other material liability (a) on prohibited
transactions imposed under Internal Revenue Code Section
4975 or ERISA or (b) under any Foreign Benefit Law;
(iii) fail to pay to any such employee pension
benefit plan any material contribution which it is
obligated to pay under the terms of such plan;
(iv) allow or suffer to exist any material accumulated
funding deficiency, whether or not waived, with respect to
any such employee pension benefit plan;
(v) allow or suffer to exist any occurrence of a
reportable event or any other event or condition, which
presents a material risk of termination by the Pension
Benefit Guaranty Corporation, or to any other Person
exercising similar duties and functions under any Foreign
Benefit Law, of any such employee pension benefit plan that
is a Single Employer Plan, which termination could result
in any material liability (a) to the Pension Benefit
Guaranty Corporation or (b) under any Foreign Benefit Law;
or
(vi) incur any material withdrawal liability with
respect to any Multi-employer Plan.
8.11 Fiscal Year. Change its Fiscal Year.
8.12 Dissolution, etc. Wind up, liquidate or dissolve
(voluntarily or involuntarily) or commence or suffer any
proceedings seeking any such winding up, liquidation or
dissolution, except in connection with (i) the merger or
consolidation of Subsidiaries into each other or into the
Borrower permitted under Section 8.08, (ii) the dissolution of
Subsidiaries wholly owned by the Borrower or by another wholly
owned Subsidiary or (iii) the dissolution of a Subsidiary which
is not wholly owned by the Borrower so long as the Borrower
remains in compliance with Section 8.06 after giving effect to
such dissolution.
8.13 Rate Hedging Obligations. Incur any Rate Hedging
Obligations or enter into any agreements, arrangements, devices
or instruments relating to Rate Hedging Obligations, except in
connection with the management of interest rate fluctuation
risks of the Borrower and its Subsidiaries and in no event shall
any Rate Hedging Obligation be incurred for speculative
purposes.
ARTICLE IX
Events of Default and Acceleration
9.01 Events of Default. If any one or more of the
following events (herein called "Events of Default") shall occur
for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by
operation of law or pursuant to or in compliance with any
judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body), that is
to say:
(a) if default shall be made in the due and punctual
payment of the principal of any Loan when and as the same shall
be due and payable whether pursuant to any provision of Article
II hereof, at maturity, by acceleration or otherwise; or
(b) if default shall be made in the due and punctual
payment of any amount of interest on any Loan or of any fees or
other amounts payable to the Lenders or the Agent under the Loan
Documents on the date on which the same shall be due and
payable; or
(c) if default shall be made in the performance or
observance of any covenant set forth in Sections 7.07, 7.10,
7.18 or Article VIII hereof; or
(d) if a default shall be made in the performance or
observance of, or shall occur under, any covenant, agreement or
provision contained in this Agreement or the Notes (other than
as described in clauses (a), (b) or (c) above) and such default
shall continue for thirty (30) or more days after the earlier of
receipt of notice of such default by the Authorized
Representative from the Agent or the Borrower becomes aware of
such default, or if a default shall be made in the performance
or observance of, or shall occur under, any covenant, agreement
or provision contained in any of the other Loan Documents
(beyond any applicable grace period, if any, contained therein),
or if any Loan Document ceases to be in full force and effect
(other than in accordance with its terms in the absence of
default or by reason of any action by the Agent or any Lender),
or if without the written consent of the Agent and the Lenders,
this Agreement or any other Loan Document shall be disaffirmed
or shall terminate, be terminable or be terminated or become
void or unenforceable for any reason whatsoever (other than in
accordance with its terms in the absence of default or by reason
of any action by the Agent or any Lender); or
(e) if a default shall occur, which is not waived, (i) in
the payment of any principal, interest, premium or other amounts
with respect to any Indebtedness for Money Borrowed (other than
the Loans) or Rate Hedging Obligations of the Borrower or of any
Subsidiary which Indebtedness is in an amount (which amount for
Rate Hedging Obligations shall be equal to the market exposure
thereunder on the date of default) not less than $20,000,000 in
the aggregate outstanding and includes without limitation any
of the Consolidated Subordinated Debt, and such default shall
continue for more than the period of grace, if any, therein
specified or (ii) in the performance, observance or fulfillment
of any term or covenant contained in any agreement or instrument
under or pursuant to which any such Indebtedness for Money
Borrowed, including without limitation any of the Consolidated
Subordinated Debt and the Senior Notes, or Rate Hedging
Obligations, may have been issued, created, assumed, guaranteed
or secured by the Borrower or any Subsidiary, and as a result of
such default the holder of any such Indebtedness, including
without limitation any of the Consolidated Subordinated Debt and
the Senior Notes, may accelerate the maturity thereof; or
(f) if any representation, warranty or other statement of
fact by the Borrower or any Guarantor contained herein or any
other Loan Document or in any writing, certificate, report or
statement at any time furnished to the Agent or any Lender by or
on behalf of the Borrower or any Guarantor pursuant to or in
connection with this Agreement or the other Loan Documents, or
otherwise, shall be false or misleading in any material respect
when given or made; or
(g) if the Borrower or any Material Subsidiary (or any
Securitization Subsidiary or any Saks REMIC Subsidiary that
would otherwise qualify as a Material Subsidiary) shall be
unable to pay its debts generally as they become due; file a
petition to take advantage of any insolvency, reorganization,
bankruptcy, receivership or similar law, domestic or foreign;
make an assignment for the benefit of its creditors; commence a
proceeding for the appointment of a receiver, trustee,
liquidator or conservator of itself or of the whole or any
substantial part of its property; file a petition or answer
seeking reorganization or arrangement or similar relief under
the federal bankruptcy laws or any other applicable law or
statute, federal, state or foreign; or
(h) if a court of competent jurisdiction shall enter an
order, judgment or decree appointing a custodian, receiver,
trustee, liquidator or conservator of the Borrower or any
Material Subsidiary (or any Securitization Subsidiary or any
Saks REMIC Subsidiary that would otherwise qualify as a Material
Subsidiary) or of the whole or any substantial part of its
properties and such order, judgment or decree continues unstayed
and in effect for a period of sixty (60) days, or approve a
petition filed against the Borrower or any Material Subsidiary
(or any Securitization Subsidiary or any Saks REMIC Subsidiary
that would otherwise qualify as a Material Subsidiary) seeking
reorganization or arrangement or similar relief under the
federal bankruptcy laws or any other applicable law or statute
of the United States of America or any state or foreign country,
province or other political subdivision, which petition is not
dismissed within sixty (60) days; or if, under the provisions of
any other law for the relief or aid of debtors, a court of
competent jurisdiction shall assume custody or control of the
Borrower or any Material Subsidiary (or any Securitization
Subsidiary or any Saks REMIC Subsidiary that would otherwise
qualify as a Material Subsidiary) or of the whole or any
substantial part of its properties, which control is not
relinquished within sixty (60) days; or if there is commenced
against the Borrower or any Material Subsidiary (or any
Securitization Subsidiary or any Saks REMIC Subsidiary that
would otherwise qualify as a Material Subsidiary) any proceeding
or petition seeking reorganization, arrangement or similar
relief under the federal bankruptcy laws or any other applicable
law or statute of the United States of America or any state or
foreign country, province or other political subdivision which
proceeding or petition remains undismissed for a period of sixty
(60) days; or if the Borrower or any Material Subsidiary (or any
Securitization Subsidiary or any Saks REMIC Subsidiary that
would otherwise qualify as a Material Subsidiary) takes any
action to indicate its consent to or approval of any such
proceeding or petition; or
(i) if (i) any judgment where the amount not covered by
insurance (or the amount as to which the insurer denies
liability) is in excess of $20,000,000 is rendered against the
Borrower or any Subsidiary, or (ii) there is any attachment,
injunction or execution against any of the Borrower's or any
Subsidiary's properties for any amount in excess of $1,000,000,
and such judgment, attachment, injunction or execution remains
unpaid, unstayed, undischarged, unbonded or undismissed for a
period of sixty (60) days; or
(j) if the Borrower or any Material Subsidiary (or any
Securitization Subsidiary or any Saks REMIC Subsidiary that
would otherwise qualify as a Material Subsidiary) shall, other
than as permitted under Section 8.06 hereof or in the ordinary
course of business (as determined by past practices), suspend
(other than for a period not to exceed twenty (20) days by
reason of force majeure) all or any part of its operations
material to the conduct of the business of the Borrower or such
Material Subsidiary (or any Securitization Subsidiary or any
Saks REMIC Subsidiary), taken as a whole; or
(k) if (i) the Borrower or any Subsidiary shall engage in
any prohibited transaction (as described in Section 8.10(ii)
hereof), which is not subject to a statutory or administrative
exemption, involving any employee pension benefit plan of the
Borrower or any Subsidiary and thereby incur any material tax,
material penalty or other material liability, (ii) any material
accumulated funding deficiency (as referred to in Section
8.10(iv) hereof), whether or not waived, shall exist with
respect to any Single Employer Plan, (iii) a reportable event
(as referred to in Section 8.10(v) hereof) (other than a
reportable event for which the statutory notice requirement to
the Pension Benefit Guaranty Corporation has been waived by
regulation) 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 institution or proceedings is,
in the reasonable opinion of the Required Lenders, likely to
result in the termination of such Single Employer Plan for
purposes of Title IV of ERISA, and in the case of such a
reportable event, the continuance of such reportable event shall
be unremedied for sixty (60) days after notice of such
reportable event pursuant to Section 4043(a), (c) or (d) of
ERISA is given, as the case may be, and shall result in the
incurrence of a material liability to any Governmental Authority
(iv) any Single Employer Plan shall terminate for purposes of
Title IV of ERISA, and such termination results in a material
liability of the Borrower or any Subsidiary to such Single
Employer Plan or the Pension Benefit Guaranty Corporation, or
(v) the Borrower or any Subsidiary shall withdraw from a Multi-
employer Plan for purposes of Title IV of ERISA, and, as a
result of any such withdrawal, the Borrower or any Subsidiary
shall incur a material withdrawal liability to such Multi-employer Plan; or
(l) if there shall occur any "Event of Default" as defined
in any of the Loan Documents or as defined in the Five Year
Facility Credit Agreement; or
(m) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (except for the ▇▇▇▇▇▇▇▇'▇ Inc.
401(k) Retirement Plan) is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except
that a Person will be deemed to have "beneficial ownership" of
all securities that such Person has the right to acquire,
whether such right is exercisable immediately or only after the
passage of time or the occurrence of an event or condition),
directly or indirectly, of more than 20% of the total voting
power of the then outstanding voting capital stock of the
Borrower;
then, and in any such event and at any time thereafter, if such
Event of Default or any other Event of Default shall have not
been waived,
(A) either or both of the following actions may
be taken: (i) the Agent may, and at the direction of
the Required Lenders shall, declare any obligation of
the Lenders to make further Loans terminated,
whereupon the obligation of each Lender to make
further Loans, hereunder shall terminate immediately,
and (ii) the Agent shall at the direction of the
Required Lenders, at their option, declare by notice
to the Borrower any or all of the Obligations to be
immediately due and payable, and the same, including
all interest accrued thereon and all other obligations
of the Borrower to the Agent and the Lenders, shall
forthwith become immediately due and payable without
presentment, demand, protest, notice or other
formality of any kind, all of which are hereby
expressly waived, anything contained herein or in any
instrument evidencing the Obligations to the contrary
notwithstanding; provided, however, that
notwithstanding the above, if (I) there shall occur an
Event of Default under clause (g) or (h) above, then
the obligation of the Lenders to make Loans hereunder
shall automatically terminate and automatically any
and all of the Obligations shall be immediately due
and payable without the necessity of any action by the
Agent or the Required Lenders or notice by the Agent
or the Lenders or to the Borrower or any other Person
or (II) if the Obligations shall immediately become
due and payable pursuant to (ii) above, then the
obligation of the Lenders to make Loans and issue
Letters of Credit hereunder shall automatically
terminate without the necessity of any action by the
Agent or the Required Lenders or notice by the Agent
or the Lenders or to the Borrower or any other Person;
and
(B) the Agent and the Lenders shall have all of
the rights and remedies available under the Loan
Documents or under any applicable law.
9.02 Agent to Act. In case any one or more Events of
Default shall occur and not have been waived, the Agent shall,
at the direction of the Required Lenders, proceed to protect and
enforce their rights or remedies either by suit in equity or by
action at law, or both, whether for the specific performance of
any covenant, agreement or other provision contained herein or
in any other Loan Document, or to enforce the payment of the
Obligations or any other legal or equitable right or remedy.
9.03 Cumulative Rights. No right or remedy herein
conferred upon the Lenders or the Agent is intended to be
exclusive of any other rights or remedies contained herein or in
any other Loan Document, and every such right or remedy shall be
cumulative and shall be in addition to every other such right or
remedy contained herein and therein or now or hereafter existing
at law or in equity or by statute, or otherwise.
9.04 No Waiver. No course of dealing between the Borrower
and any Lender or the Agent or any failure or delay on the part
of any Lender or the Agent in exercising any rights or remedies
under any Loan Document or otherwise available to it shall
operate as a waiver of any rights or remedies and no single or
partial exercise of any rights or remedies shall operate as a
waiver or preclude the exercise of any other rights or remedies
hereunder or of the same right or remedy on a future occasion.
9.05 Allocation of Proceeds. If an Event of Default has
occurred and not been waived, and the maturity of the Notes and
Obligations has been accelerated pursuant to Article IX hereof,
all payments received by the Agent hereunder, in respect of any
principal of or interest on the Obligations or any other amounts
payable by the Borrower hereunder shall be applied by the Agent
in the following order:
(i) amounts due to the Agent and the Lenders pursuant
to Sections 2.12, 11.06 and 11.11 hereof;
(ii) amounts due to NationsBank, NMS and the Agent
pursuant to Section 2.15 hereof;
(iii) payments of interest on Revolving Credit
Loans, to be applied for the ratable benefit of the
Lenders, and payments of interest on Competitive Bid Loans
to be applied to the applicable Competitive Bid Loan
Lender;
(iv) payments of principal on Revolving Credit Loans,
to be applied for the ratable benefit of the Lenders, and
payments of principal on Competitive Bid Loans to be
applied to the applicable Competitive Bid Loan Lender;
(v) payment of Obligations owed a Lender or Lenders
pursuant to Swap Agreements on a pro rata basis according
to amounts owed;
(vi) payments of all other amounts due under this
Agreement, if any, to be applied for the ratable benefit of
the Lenders; and
(vii) any surplus remaining after application as
provided for herein, to the Borrower or otherwise as may be
required by applicable law.
ARTICLE X
The Agent
10.01. Appointment, Powers, and Immunities. Each Lender
hereby irrevocably appoints and authorizes the Agent to act as
its agent under this Agreement and the other Loan Documents with
such powers and discretion as are specifically delegated to the
Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably
incidental thereto. The Agent (which term as used in this
sentence and in Section 10.05 and the first sentence of Section
10.06 hereof shall include its affiliates and its own and its
affiliates' officers, directors, employees, agents): (a) shall
not have any duties or responsibilities except those expressly
set forth in this Agreement and shall not be a trustee or
fiduciary for any Lender; (b) shall not be responsible to the
Lenders for any recital, statement, representation, or warranty
(whether written or oral) made in or in connection with any Loan
Document or any certificate or other document referred to or
provided for in, or received by any of them under, any Loan
Document, or for the value, validity, effectiveness,
genuineness, enforceability, or sufficiency of any Loan
Document, or any other document referred to or provided for
therein or for any failure by any Loan Party or any other Person
to perform any of its obligations thereunder; (c) shall not be
responsible for or have any duty to ascertain, inquire into, or
verify the performance or observance of any covenants or
agreements by any Loan Party or the satisfaction of any
condition or to inspect the property (including the books and
records) of any Loan Party or any of its Subsidiaries or
affiliates; (d) shall not be required to initiate or conduct any
litigation or collection proceedings under any Loan Document;
and (e) shall not be responsible for any action taken or omitted
to be taken by it under or in connection with any Loan Document,
except for its own gross negligence or willful misconduct. The
Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents
or attorneys-in-fact selected by it with reasonable care.
10.02. Reliance by Agent. The Agent shall be entitled to
rely upon any certification, notice, instrument, writing, or
other communication (including, without limitation, any thereof
by telephone or telecopy) believed by it to be genuine and
correct and to have been signed, sent or made by or on behalf of
the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel for any Loan Party),
independent accountants, and other experts selected by the
Agent. The Agent may deem and treat the payee of any Note as
the holder thereof for all purposes hereof unless and until the
Agent receives and accepts an Assignment and Acceptance executed
in accordance with Section 11.01 hereof. As to any matters not
expressly provided for by this Agreement, the Agent shall not be
required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the
instructions of the Required Lenders, and such instructions
shall be binding on all of the Lenders; provided, however, that
the Agent shall not be required to take any action that exposes
the Agent to personal liability or that is contrary to any Loan
Document or applicable law or unless 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 any such action.
10.03. Defaults. The Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default or Event of
Default unless the Agent has received written notice from a
Lender or the Borrower specifying such Default or Event of
Default and stating that such notice is a "Notice of Default".
In the event that the Agent receives such a notice of the
occurrence of a Default or Event of Default, the Agent shall
give prompt notice thereof to the Lenders. The Agent shall
(subject to Section 10.02 hereof) take such action with respect
to such Default or Event of Default as shall reasonably be
directed by the Required Lenders, provided that, unless and
until the Agent shall have received such directions, the 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 interest of
the Lenders.
10.04. Rights as Lender. With respect to its Revolving
Credit Commitment and the Loans made by it, NationsBank (and any
successor acting as Agent) in its capacity as a Lender hereunder
shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not acting as
the Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Agent in its individual
capacity. NationsBank (and any successor acting as Agent) and
its affiliates may (without having to account therefor to any
Lender) accept deposits from, lend money to, make investments
in, provide services to, and generally engage in any kind of
lending, trust, or other business with any Loan Party or any of
its Subsidiaries or affiliates as if it were not acting as
Agent, and NationsBank (and any successor acting as Agent) and
its affiliates may accept fees and other consideration from any
Loan Party or any of its Subsidiaries or affiliates for services
in connection with this Agreement or otherwise without having to
account for the same to the Lenders.
10.05. Indemnification. The Lenders agree to indemnify
the Agent (to the extent not reimbursed under Section 11.11
hereof, but without limiting the obligations of the Borrower
under such Section) ratably in accordance with their respective
Applicable Commitment Percentages, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including attorneys' fees), or
disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against the Agent (including
by any Lender) in any way relating to or arising out of any Loan
Document or the transactions contemplated thereby or any action
taken or omitted by the Agent under any Loan Document provided
that no Lender shall be liable for any of the foregoing to the
extent they arise from the gross negligence or willful
misconduct of the Person to be indemnified. Without limitation
of the foregoing, each Lender agrees to reimburse the Agent
promptly upon demand for its ratable share of any costs or
expenses payable by the Borrower under Section 11.11, to the
extent that the Agent is not promptly reimbursed for such costs
and expenses by the Borrower. The agreements contained in this
Section 10.05 shall survive payment in full of the Loans, the
Obligations and all other amounts payable under this Agreement.
10.06. Non-Reliance on Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on
the Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit
analysis of the Loan Parties and their Subsidiaries and decision
to enter into this Agreement and that it will, independently and
without reliance upon the 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 analysis and decisions in
taking or not taking action under the Loan Documents. Except
for notices, reports, and other documents and information
expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility
to provide any Lender with any credit or other information
concerning the affairs, financial condition, or business of any
Loan Party or any of its Subsidiaries or affiliates that may
come into the possession of the Agent or any of its affiliates.
10.07. Resignation of Agent. The Agent may resign at any
time by giving notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty (30) days after the
retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a
successor Agent which shall be a commercial bank organized under
the laws of the United States of America having combined capital
and surplus of at least $100,000,000. Upon the acceptance of
any appointment as Agent hereunder by a successor, such
successor shall thereupon succeed to and become vested with all
the rights, powers, discretion, privileges, and duties of the
retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations hereunder. After any retiring
Agent's resignation hereunder as Agent, the provisions of this
Article X shall continue in effect for its benefit in respect of
any actions taken or omitted to be taken by it while it was
acting as Agent.
ARTICLE XI
Miscellaneous
11.01 Assignments and Participations.
(a) Each Lender may assign to one or more Eligible
Assignees all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion
of its Loans, its Notes, and its Revolving Credit Commitment);
provided, however, that
(i) each such assignment shall be to an Eligible
Assignee;
(ii) each such assignment by a Lender shall (A) be of
an equal percentage of all of its rights and obligations under
both the Revolving Credit Facility and the Five Year Facility,
(B) be of a constant, and not varying, percentage of all of its
rights and obligations under this Agreement and its Notes, and
under the Five Year Facility Credit Agreement and the promissory
notes issued thereunder and (C) result in the assigning Lender
having an equivalent Applicable Commitment Percentage under both
the Revolving Credit Facility and the Five Year Facility and the
assignee Lender having an equivalent Applicable Commitment
Percentage under both the Revolving Credit Facility and the Five
Year Facility;
(iii) except in the case of an assignment to
another Lender or an assignment of all of a Lender's rights and
obligations under this Agreement and under the Five Year
Facility Credit Agreement, any partial assignment of a Lender's
Revolving Credit Commitment and its Five Year Facility
Commitment shall be in an aggregate amount at least equal to
$10,000,000 or an integral multiple of $5,000,000 in excess
thereof;
(iv) except in the case of an assignment of all of a
Lender's rights and obligations under this Agreement, no Lender
shall make any assignment that would result in the sum of its
Revolving Credit Commitment and its Five Year Facility
Commitment being less than $15,000,000;
(v) in the event a Lender assigns all of its
Revolving Credit Commitment, such assignment must include all of
its Competitive Bid Loans; and
(vi) the parties to such assignment shall execute and
deliver to the Agent for its acceptance an Assignment and
Acceptance, together with any Note subject to such assignment
and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and,
to the extent of such assignment, have the obligations, rights,
and benefits of a Lender hereunder and the assigning Lender
shall, to the extent of such assignment, relinquish its rights
and be released from its obligations under this Agreement;
provided, the assigning Lender shall be entitled to
reimbursement from the Borrower with respect to amounts payable
pursuant to Sections 4.01, 4.05, 4.06, 11.06 and 11.11 in
connection with events prior to such assignment; provided
further, to the extent the Borrower makes any such payments to
the assigning Lender, the Borrower shall not be required to also
pay the assignee such amounts. Upon the consummation of any
assignment pursuant to this Section, the assignor, the Agent and
the Borrower shall make appropriate arrangements so that, if
required, new Notes are issued to the assignor and the assignee.
If the assignee is not incorporated under the laws of the United
States of America or a state thereof, it shall deliver to the
Borrower and the Agent certification as to exemption from
deduction or withholding of Taxes in accordance with Section
4.06.
(b) The Agent shall maintain at its Principal Office a
copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and
addresses of the Lenders and the Revolving Credit Commitment of,
and principal amount of the Loans owing to, each Lender from
time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agent and the Lenders may
treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. 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.
(c) Upon its receipt of an Assignment and Acceptance
executed by the parties thereto, together with any Note subject
to such assignment and payment of the processing fee, the Agent
shall, if such Assignment and Acceptance has been completed and
is in substantially the form of Exhibit B hereto, (i) accept
such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice
thereof to the parties thereto.
(d) Each Lender may sell participations to one or more
Persons in a portion of its rights, obligations or rights and
obligations under this Agreement (including all or a portion of
its Commitment or its Loans); provided, however, that (i) such
Lender s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to
the other parties hereto for the performance of such
obligations, (iii) the participant shall be entitled to the
benefit of the yield protection provisions contained in Article
IV and the right of setoff contained in Section 11.04, and (iv)
the Borrower shall continue to deal solely and directly with
such Lender in connection with such Lender s rights and
obligations under this Agreement, and such Lender shall retain
the sole right to enforce the obligations of the Borrower
relating to its Loans and its Notes and to approve any
amendment, modification, or waiver of any provision of this
Agreement (other than amendments, modifications, or waivers
decreasing the amount of principal of or the rate at which
interest is payable on such Loans or Notes, extending any
scheduled principal payment date or date fixed for the payment
of interest on such Loans or Notes, or extending its Revolving
Credit Commitment).
(e) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time assign and pledge all or
any portion of its Loans and its Note to any Federal Reserve
Bank as collateral security pursuant to Regulation A and any
Operating Circular issued by such Federal Reserve Bank. No such
assignment shall release the assigning Lender from its
obligations hereunder.
(f) Any Lender may furnish any information concerning the
Borrower or any of its Subsidiaries in the possession of such
Lender from time to time to assignees and participants
(including prospective assignees and participants), subject,
however, to the provisions of Section 11.03 hereof.
(g) The Borrower may not assign any rights, powers, duties
or obligations under this Agreement or the other Loan Documents
without the prior written consent of all the Lenders.
11.02 Notices. All notices shall be in writing, except as
to telephonic notices expressly permitted or required herein,
and written notices shall be delivered by hand delivery,
telefacsimile, overnight courier or certified or registered
mail. Any notice shall be conclusively deemed to have been
received by any party hereto and be effective on the day on
which delivered to such party (against (except as to telephonic
or telefacsimile notice) receipt therefor) at the address set
forth below or such other address as such party shall specify to
the other parties in writing:
(a) if to the Borrower:
Saks Incorporated
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & Bird LLP
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Agent:
NationsBank, N.A.
Independence Center, 15th Floor
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇, Agency Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
NationsBank, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telefacsimile: ▇▇▇-▇▇▇-▇▇▇▇
(c) if to the Lenders:
At the addresses set forth on the signature pages
hereof and on the signature page of each
Assignment and Acceptance.
11.03 Confidentiality. The Agent and each Lender (each,
a "Lending Party") agrees to keep confidential any information
furnished or made available to it by the Borrower pursuant to
this Agreement and that is marked confidential; provided that
nothing herein shall prevent any Lending Party from disclosing
such information (a) to any other Lending Party or any affiliate
of any Lending Party, or any officer, director, employee, agent
or advisor of any Lending Party or any affiliate of any Lending
Party, (b) to any other Person if reasonably incidental to the
administration of the credit facility provided herein, (c) as
required by any law, rule, or regulation, (d) upon the order of
any court or administrative agency, (e) upon the request or
demand of any regulatory agency or authority, (f) that is or
becomes available to the public or that is or becomes available
to any Lending Party other than as a result of a disclosure by
any Lending Party prohibited by this Agreement, (g) in
connection with any litigation to which such Lending Party or
any of its affiliates may be a party, (h) to the extent
necessary in connection with the exercise of any remedy under
this Agreement or any other Loan Document, and (i) subject to
provisions substantially similar to those contained in this
Section, to any actual or proposed participant or assignee.
11.04 Right of Setoff; Adjustments.
(a) Upon the occurrence and during the continuance of any
Event of Default, each Lender (and each of its affiliates) is
hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing
by such Lender (or any of its affiliates) to or for the credit
or the account of the Borrower against any and all of the
Obligations of the Borrower now or hereafter existing,
irrespective of whether such Lender shall have made any demand
under this Agreement or any of its Notes. Each Lender agrees
promptly to notify the Borrower after any such setoff and
application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under
this Section are in addition to other rights and remedies
(including, without limitation, other rights of setoff) that
such Lender may have.
(b) If any Lender (a "benefitted Lender") shall at any
time receive any payment of all or part of the Loans (other than
Competitive Bid Loans) owing to it, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily
or involuntarily, by setoff, 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
Loans (other than Competitive Bid Loans) owing to it, or
interest thereon, such benefitted Lender shall purchase for cash
from the other Lenders a participating interest in such portion
of each such other Lender's Loans (other than Competitive Bid
Loans) owing to it, 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; 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 any Lender so purchasing a participation from a
Lender pursuant to this Section 11.04 may, to the fullest extent
permitted by law, exercise all of its rights of payment
(including the right of setoff) with respect to such
participation as fully as if such Person were the direct
creditor of the Borrower in the amount of such participation.
11.05 Survival. All covenants, agreements,
representations and warranties made herein shall survive the
making by the Lenders of the Loans and the execution and
delivery to the Lenders of this Agreement and the Notes and
shall continue in full force and effect until the occurrence of
the Total Facility Termination Date. Whenever in this
Agreement, any of the parties hereto is referred to, such
reference shall be deemed to include the successors and
permitted assigns of such party and all covenants, provisions
and agreements by or on behalf of the Borrower which are
contained in this Agreement, the Notes and the other Loan
Documents shall inure to the benefit of the successors and
permitted assigns of the Lenders or any of them.
11.06 Expenses. The Borrower agrees to pay on demand all
reasonable costs and expenses of the Agent in connection with
the preparation, execution, delivery, administration,
modification, waiver and amendment of this Agreement, the other
Loan Documents, and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees
and expenses of counsel for the Agent with respect thereto and
with respect to advising the Agent as to its rights and
responsibilities under the Loan Documents. The Borrower further
agrees to pay on demand all reasonable costs and expenses of the
Agent and of each of the Lenders, if any (including, without
limitation, reasonable attorneys' fees actually incurred and
expenses and the cost of internal counsel), in connection with
the enforcement, workout or preservation of any rights under
this Agreement and other Loan Documents (whether through
negotiations, legal proceedings, or otherwise) and the other
documents to be delivered hereunder.
11.07 Amendments and Waivers. Any provision of this
Agreement or any other Loan Document may be amended or waived
if, but only if, such amendment or waiver is in writing and is
signed by the Borrower and the Required Lenders (and, if Article
X or the rights or duties of the Agent are affected thereby, by
the Agent); provided that no such amendment or waiver shall,
unless signed by all the Lenders, (i) increase the Revolving
Credit Commitments of the Lenders, (ii) reduce the principal of,
or rate of interest on, any Loan (other than a Competitive Bid
Loan, which shall require only the written consent or approval
by the applicable Lender for such Competitive Bid Loan) or any
fees or other amounts payable hereunder, including without
limitation accrued interest, (iii) postpone any date fixed for
the payment of any scheduled installment of principal of or
interest on any Loan or any fees or other amounts payable
hereunder or for termination of any Revolving Credit Commitment,
(iv) change the percentage of the Revolving Credit Commitments
or of the unpaid principal amount of the Notes, or the number of
Lenders or the amount of Credit Exposure, which shall be
required for the Lenders or any of them to take any action under
this Section or any other provision of this Agreement, (v)
release any Guarantor or (vi) amend or delete any provision of
this Section 11.07.
11.08 Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and
delivered shall be deemed an original, and it shall not be
necessary in making proof of this Agreement to produce or
account for more than one such fully-executed counterpart.
11.09 Termination. At such date (the "Total Facility
Termination Date") as (a) all of the Revolving Credit
Commitments have been terminated, (b) none of the Lenders is
obligated any longer under this Agreement to make any Loans and
(c) all Obligations (other than liabilities of the Borrower to
any Lender under a Swap Agreement and obligations which survive
as provided in the following two sentences) have been paid and
satisfied in full, this Agreement shall terminate.
Notwithstanding the foregoing, the termination of this Agreement
shall not affect any rights of the Borrower, the Lenders or the
Agent or any obligation of the Borrower, the Lenders or the
Agent, arising prior to the effective date of such termination,
and all representations, warranties, covenants, waivers and
agreements contained herein shall continue until this Agreement
is so terminated, unless continuing thereafter as otherwise
provided herein. Without limitation of the foregoing, the
provisions of Sections 4.05, 4.06, 10.05, 11.06 and 11.11 shall
survive the occurrence of the Total Facility Termination Date
and the termination of this Agreement and the Loan Documents.
Notwithstanding the foregoing, if after receipt of any payment
pursuant to the Loan Documents of all or any part of the
Obligations, any Lender is for any reason compelled to surrender
such payment to any Person because such payment is determined to
be void or voidable as a preference, impermissible setoff, a
diversion of trust funds or for any other reason, this Agreement
shall continue in full force and the Borrower shall be liable
to, and shall indemnify and hold such Lender harmless for, the
amount of such payment surrendered until such Lender shall have
been finally and irrevocably paid in full. The provisions of
the foregoing sentence shall be and remain effective
notwithstanding any contrary action which may have been taken by
the Lenders in reliance upon such payment, and any such contrary
action so taken shall be without prejudice to the Lenders'
rights under this Agreement and shall be deemed to have been
conditioned upon such payment having become final and irrevoc-
able.
11.10 Governing Law. All documents executed pursuant to
the transactions contemplated herein, including, without
limitation, this Agreement and each of the Loan Documents shall
be deemed to be contracts made under, and for all purposes shall
be construed in accordance with, the internal laws and judicial
decisions of the State of Georgia. The Borrower hereby submits
to the jurisdiction and venue of the state and federal courts of
Georgia for the purposes of resolving disputes hereunder or for
the purposes of collection.
11.11 Indemnification. (a) The Borrower agrees to
indemnify and hold harmless the Agent and each Lender and each
of their affiliates and their respective officers, directors,
employees, agents, and advisors (each, an "Indemnified Party")
from and against any and all claims, damages, losses,
liabilities, costs, and expenses (including, without limitation,
assessment and cleanup costs and reasonable attorneys',
consultants or other expert fees, expenses and disbursements )
that are incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection
with or relating to or by reason of (including, without
limitation, in connection with any investigation, litigation, or
proceeding or preparation of defense in connection therewith)
the Loan Documents, any of the transactions contemplated herein,
the actual or proposed use of the proceeds of the Loans, the
violation of any Environmental Law by the Borrower or any
Subsidiary or with respect to any property owned, operated or
leased by the Borrower or any Subsidiary or the handling,
storage, transportation, treatment, emission, release, discharge
or disposal of any Hazardous Material by, on behalf or in
respect of the Borrower or any Subsidiary or on or with respect
to property owned or leased or operated by the Borrower or any
Subsidiary, except to the extent (i) such claim, damage, loss,
liability, cost, or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful
misconduct or (ii) relating to actions or proceedings brought by
an Indemnified Party against another Indemnified Party not
arising from any action or inaction by the Borrower or any
Subsidiary or (iii) resulting from any claim brought by the
Borrower against any Lender for failure to fund under the
Revolving Credit Facility (including the failure to fund a
Competitive Bid Loan after the Borrower's acceptance of such
Lender's Competitive Bid Quote in accordance with Section 2.03
hereof) in accordance with this Agreement in which the Borrower
is the prevailing party. In the case of an investigation,
litigation or other proceeding to which the indemnity in this
Section 11.11 applies, such indemnity shall be effective whether
or not such investigation, litigation or proceeding is brought
by the Borrower, its directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified Party
is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. If and to the extent that
the foregoing undertaking may be unenforceable for any reason,
the Borrower hereby agrees to make the maximum contribution to
the payment and satisfaction of each of the indemnified
liabilities which is permissible under applicable law. The
Borrower further agrees not to assert any claim against the
Agent, any Lender, any of their affiliates, or any of their
respective directors, officers, employees, attorneys, agents,
and advisers, on any theory of liability for special, indirect,
consequential, or punitive damages arising out of or otherwise
relating to the Loan Documents, any of the transactions
contemplated herein or the actual or proposed use of the
proceeds of the Loans. Without prejudice to the survival of any
other agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 11.11
shall survive the occurrence of the Total Facility Termination
Date.
(b) If a claim is to be made by a party entitled to
indemnification under this Section 11.11 against the Borrower,
the Indemnified Party shall give written notice to the Borrower
promptly after the Indemnified Party receives actual notice of
any claim, action, suit, loss, cost, liability, damage or
expense incurred or instituted for which the indemnification is
sought. If requested by Borrower in writing, and so long as no
Default or Event of Default shall have occurred and be
continuing, such Indemnified Party shall contest at the expense
of the Borrower the validity, applicability and/or amount of
such suit, action, or cause of action to the extent such contest
may be conducted in good faith on legally supportable grounds.
If any lawsuit or enforcement action is filed against any
Indemnified Party, written notice thereof shall be given to the
Borrower as soon as practicable (and in any event within 20 days
after the service of the citation or summons). Notwithstanding
the foregoing, the failure so to notify the Borrower as provided
in this Section will relieve the Borrower from liability
hereunder only if and to the extent that such failure results in
the forfeiture by the Borrower of any substantive rights or
defenses. The Indemnified Party shall control the defense and
investigation of such lawsuit or action and to employ and engage
counsel of its own choice to handle and defend the same, at the
Borrower's cost, risk and expense; provided, however, that the
Borrower may, at its own cost participate in the investigation,
trial and defense of such lawsuit or action and any appeal
arising therefrom. If the Borrower has acknowledged to the
Indemnified Party its obligation to indemnify hereunder, the
Indemnified Party, so long as no Default or Event of Default
shall have occurred and be continuing, shall not settle such
lawsuit or enforcement action without the prior written consent
of the Borrower and, if the Borrower has not so acknowledged its
obligation, the Indemnified Party shall not settle such lawsuit
or enforcement action without giving twenty (20) days' prior
written notice of such settlement and its terms to the Borrower.
11.12 Headings and References. The headings of the
Articles and Sections of this Agreement are inserted for
convenience of reference only and are not intended to be a part
of, or to affect the meaning or interpretation of this
Agreement. Words such as "hereof", "hereunder", "herein" and
words of similar import shall refer to this Agreement in its
entirety and not to any particular Section or provisions hereof,
unless so expressly specified. As used herein, the singular
shall include the plural, and the masculine shall include the
feminine or a neutral gender, and vice versa, whenever the
context requires.
11.13 Severability. If any provision of this Agreement or
the other Loan Documents shall be determined to be illegal or
invalid as to one or more of the parties hereto, then such
provision shall remain in effect with respect to all parties, if
any, as to whom such provision is neither illegal nor invalid,
and in any event all other provisions hereof shall remain
effective and binding on the parties hereto.
11.14 Entire Agreement. This Agreement, together with the
other Loan Documents, constitutes the entire agreement between
the parties with respect to the subject matter hereof and
supersedes all previous proposals, negotiations,
representations, commitments and other communications between or
among the parties, both oral and written, with respect thereto.
11.15 Agreement Controls. In the event that any term of
any of the Loan Documents other than this Agreement conflicts
with any term of this Agreement, the terms and provisions of
this Agreement shall control.
11.16 Usury Savings Clause. Notwithstanding any other
provision herein, the aggregate interest rate charged under any
of the Notes, including all charges or fees in connection
therewith deemed in the nature of interest under Georgia law,
shall not exceed the Highest Lawful Rate (as such term is
defined below). If the rate of interest (determined without
regard to the preceding sentence) under this Agreement at any
time exceeds the Highest Lawful Rate (as defined below), the
outstanding amount of the Loans made hereunder shall bear
interest at the Highest Lawful Rate until the total amount of
interest due hereunder equals the amount of interest which would
have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect. In
addition, if and when the Loans made hereunder are repaid in
full the total interest due hereunder (taking into account the
increase provided for above) is less than the total amount of
interest which would have been due hereunder if the stated rates
of interest set forth in this Agreement had at all times been in
effect, then to the extent permitted by law, the Borrower shall
pay to the Agent an amount equal to the difference between the
amount of interest paid and the amount of interest which would
have been paid if the Highest Lawful Rate had at all times been
in effect. Notwithstanding the foregoing, it is the intention
of the Lenders and the Borrower to conform strictly to any
applicable usury laws. Accordingly, if any Lender contracts
for, charges, or receives any consideration which constitutes
interest in excess of the Highest Lawful Rate, then any such
excess shall be canceled automatically and, if previously paid,
shall at such Lender's option be applied to the outstanding
amount of the Loans made hereunder or be refunded to the
Borrower. As used in this paragraph, the term "Highest Lawful
Rate" means the maximum lawful interest rate, if any, that at
any time or from time to time may be contracted for, charged, or
received under the laws applicable to suc Lender which are
presently in effect or, to the extent allowed by law, under such
applicable laws which may hereafter be in effect and which allow
a higher maximum non-usurious interest rate than applicable laws
now allow.
11.17 Reserved.
11.18 Waiver of Jury Trial. EXCEPT AS PROHIBITED BY LAW,
EACH PARTY HERETO HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OF THE LOAN DOCUMENTS.
11.19 Removal of Lenders. If (a) a Lender requests
compensation pursuant to Sections 4.01(a) or (b) or Section 4.06
and the Required Lenders are not also doing the same, (b) the
obligation of a Lender to make Eurodollar Loans or to Continue,
or to Convert Base Rate Loans into, Eurodollar Loans shall be
suspended pursuant to Section 4.01(a) or Section 4.03 but the
obligation of the Required Lenders shall not have been suspended
under such Sections, (c) any Lender refuses or otherwise fails
to consent to any waiver, amendment or other modification of any
Loan Document which (i) requires the unanimous written consent
of all Lenders under Section 11.07 and (ii) has been approved in
writing by the Required Lenders, then, so long as there does not
then exist any Default or Event of Default, or (d) any Lender is
a Non-Consenting Lender, then the Borrower may either (A) demand
that such Lender (the "Affected Lender"), and upon such demand
the Affected Lender shall promptly, assign its Revolving Credit
Commitment and its Five Year Facility Commitment and all of its
Loans and Five Year Facility Loans to another Eligible Assignee
identified by the Borrower and willing to become a Lender
hereunder and under the Five Year Facility Credit Agreement
subject to and in accordance with the provisions of Section
11.01(a) for a purchase price equal to the aggregate principal
balance of Loans and Five Year Facility Loans then owing to the
Affected Lender plus any accrued but unpaid interest thereon,
accrued but unpaid fees owing to the Affected Lender and any
amounts owing the Affected Lender under Section 4.05 hereunder
and Section 4.05 under the Five Year Facility Credit Agreement,
or (B) pay to the Affected Lender the aggregate principal
balance of Loans and Five Year Facility Loans then owing to the
Affected Lender plus any accrued but unpaid interest thereon,
accrued but unpaid fees owing to the Affected Lender, any
amounts owing the Affected Lender under Section 4.05 hereunder
and Section 4.05 under the Five Year Facility Credit Agreement
and any other amounts agreed by the Borrower to be owing to the
Affected Lender, whereupon the Affected Lender shall no longer
be a party hereto or to the Five Year Facility Credit Agreement
or have any rights or obligations hereunder or thereunder or
under any of the other Loan Documents (including such documents
as defined in the Five Year Credit Facility Agreement) and the
Total Revolving Credit Commitment shall immediately and
permanently be reduced by an amount equal to the amount of the
Affected Lender's Revolving Credit Commitment and the Total
Revolving Credit Commitment (as defined in the Five Year
Facility Credit Agreement) shall immediately and permanently be
reduced by an amount equal to the amount of the Affected
Lender's Five Year Facility Commitment. Each of the Agent and
the Affected Lender shall reasonably cooperate in effectuating
the replacement of an Affected Lender under this Section 11.19,
but at no time shall the Agent or the Affected Lender be
obligated in any way whatsoever to initiate any such
replacement. The exercise by the Borrower of its rights under
this Section 11.19 shall be at the Borrower's sole cost and
expense.
11.20 Guaranty Terminations. Upon the satisfaction of
each of the following conditions, the Guaranty shall upon
delivery to the Agent of the written request of the Borrower
automatically terminate and be of no further force or effect and
each Guarantor thereunder shall be automatically,
unconditionally and fully released and discharged from all of
its obligations and liabilities under or in respect thereof
without any action by the Borrower, any Subsidiary, the Agent
(other than its written approval of the release terms as
contemplated in condition (b) below) or any Lender: (a) the
achievement of an Investment Grade Rating by the Borrower and
(b) each Subsidiary of the Borrower shall be released
(simultaneously with, or prior to, the effectiveness of this
Section 11.20) on terms reasonably satisfactory to the Agent
from its guaranty obligations of any other Indebtedness for
Money Borrowed of the Borrower (other than such guarantees which
together with all other Subsidiary Indebtedness (after giving
effect to the termination of the Guaranty) in the aggregate do
not exceed the maximum amount of Subsidiary Indebtedness then
permitted under Section 8.04(b) hereof). In addition, any
Pledge Agreement delivered pursuant to Section 7.18 shall
automatically terminate and be of no further force or effect
simultaneously with the termination of the Guaranty. The Agent
shall promptly deliver to the Borrower any stock certificates
and stock powers delivered to the Agent in connection with any
such Pledge Agreement.
[Signatures on following pages.]
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be made, executed and delivered by their duly
authorized officers as of the day and year first above written.
SAKS INCORPORATED
By:
Name:
Title:
ATTEST:
_________________________
_________________________
NATIONSBANK, N.A., as
Administrative Agent for the
Lenders
By:
Name:
Title: _________ Vice President
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK,
as Co-Syndication Agent and as a
Lender
By:
Name:
Title:
Lending Office:
▇▇▇▇▇▇ Guaranty Trust Company of New York
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
▇▇▇▇▇▇ Guaranty Trust Company of New York
New York, New York
ABA# ▇▇▇-▇▇▇-▇▇▇
For Credit to: Loan Department
A/C: ▇▇▇-▇▇-▇▇▇
Attention: Corporate
Processing - Mod 02
Reference: ▇▇▇▇▇▇▇▇'▇, Inc.
THE CHASE MANHATTAN BANK,
as Co-Syndication Agent and as a
Lender
By:
Name:
Title:
By:
Name:
Title:
Lending Office:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
ABA No.: 021-000021
Attention: ▇▇▇▇ ▇▇▇▇▇, Loan
Services Dept.
Reference: CITIBANK, N.A.,
as Documentation Agent and as a
Lender
By:
Name:
Title:
By:
Name:
Title:
Lending Office:
Citicorp Securities
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇/▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Assistant Vice President - Banker
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Citibank, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ABA No.: ▇▇▇▇▇▇▇▇▇
Account No.: 4063-2387
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Reference: Saks Incorporated
NATIONSBANK, N.A.
By:
Name:
Title: _______ Vice President
Lending Office: NationsBank, N.A.
Independence Center, 15th Floor
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇,
Agency Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
NationsBank, N.A.
ABA# ▇▇▇▇▇▇▇▇▇
Reference: Saks Incorporated
Account No.: 136621-▇▇▇▇▇▇▇
Attention: CCS/Agency Services
NATIONAL CITY BANK, KENTUCKY
By:
Name:
Title: Vice President
Lending Office: National City Bank, Kentucky
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▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇,
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
National City Bank Kentucky
▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ABA# ▇▇▇-▇▇▇-▇▇▇
Reference: Saks Incorporated
Account No.: 5737553042
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇,
Commercial Loan Operations
SOUTHTRUST BANK, NATIONAL
ASSOCIATION
By:
Name:
Title:
Lending Office: SouthTrust Bank, N.A.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Assistant Vice
President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
SouthTrust Bank, N.A.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 131009
Reference: Saks Incorporated
Attention: ▇▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
(ext. 5446)
FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
By:
Name:
Title: Senior Vice President
Lending Office: First Tennessee
Bank National Association
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
First Tennessee Bank National
Association
Memphis, Tennessee
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 114174 6870
Reference: ▇▇▇▇▇▇▇▇'▇,
Inc./Saks,
Incorporated.
Attention: Ms. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
ext. ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
By:
Name:
Title:
Lending Office: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇
Relationship
Manager
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
The Bank of Nova Scotia
New York Agency
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ABA# ▇▇▇▇▇▇▇▇▇
For Further Credit to:
The Bank of Nova Scotia - Atlanta Agency
Account No.: ▇▇▇▇▇▇▇
Attention: Atlanta/Houston
Loan Operations
Reference: Saks Incorporated
HIBERNIA NATIONAL BANK
By:
Name:
Title: Assistant Vice President
Lending Office: Hibernia National Bank
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Hibernia National Bank
New Orleans, Louisiana
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 0520-36615
Reference: ▇▇▇▇▇▇▇▇'▇ Inc.
Attention: National Accounts
FIRST AMERICAN NATIONAL BANK
By:
Name:
Title:
Lending Office: First American National Bank
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇
Senior Vice
President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
First American National Bank
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 1002295498
Reference: Saks Incorporated
Attention: Frenisa Joy
NORWEST BANK IOWA, NATIONAL
ASSOCIATION
By:
Name:
Title: Vice President
Lending Office: Norwest Bank
Iowa, National Association
M.S. 4019
▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Norwest Bank Iowa, N.A.
Des Moines, Iowa
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 970656
Reference: ▇▇▇▇▇▇▇▇'▇,
Inc./Saks Incorporated
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ or
▇▇▇▇▇ ▇▇▇▇▇
THE FIRST NATIONAL BANK OF
CHICAGO
By:
Name:
Title:
Lending Office: The First National Bank
of Chicago
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
The First National Bank of
Chicago
Chicago, Illinois
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 7521-7653
DCS Incoming Clearing
Account
Reference: Saks Incorporated
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
CREDIT LYONNAIS ATLANTA AGENCY
By:
Name:
Title: Vice President
Credit Lyonnais Atlanta Agency
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Credit Lyonnais New York Branch
1301 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ABA#▇▇▇▇-▇▇▇▇-▇
Account No.: 01-24173.0001.00
Credit: Credit Lyonnais Atlanta
Agency
Reference: Saks Incorporated
Attention: Loan Servicing
THE BANK OF NEW YORK
By:
Name:
Title:
Lending Office:
The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇/1483
Wire Transfer Instructions:
Base Rate Loans: The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇: ▇▇▇▇▇▇▇▇▇
Commercial Loan Servicing Department
GLA No.: 111556
Reference: Saks Incorporated
ie: principal, interest, fees
EuroDollar Loans: The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇: ▇▇▇▇▇▇▇▇▇
Eurodollar/Cayman Funding Area
GLA No.: 111556
Reference: Saks Incorporated
ie: principal, interest
U.S. BANK NATIONAL ASSOCIATION
By:
Name:
Title:
Lending Office:
U.S. Bank National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Mail Stop MPFP0510
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Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
U.S. National Bank Association
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ABA #: ▇▇▇▇▇▇▇▇▇
Attention: Commercial Loan
Service Center
Account No.: 30000472160600
Reference: for ▇▇▇▇▇▇▇▇'▇,
Inc.
A/C No.: 1735056807
UNION BANK OF CALIFORNIA, N.A.
By:
Name:
Title:
Lending Office:
Union Bank of California, N.A.
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Attention: ▇▇▇▇▇ ▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Union Bank of California, N.A.
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ABA No.: ▇▇▇▇-▇▇▇▇-▇
Account No.: 070196431
Attention: Commercial Loan
Operations
Reference: Saks Incorporated
WACHOVIA BANK, N.A.
By:
Name:
Title:
Lending Office:
Wachovia Bank, N.A.
MCGA 3940
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Attention: ▇▇▇▇▇ ▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Wachovia Bank, N.A.
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ABA# ▇▇▇▇▇▇▇▇▇
Account No.: ▇▇-▇▇▇-▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Reference: Saks Inc.
ABN AMRO BANK NV
By:
Name:
Title:
Lending Office:
ABN AMRO Bank N.V.
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Attention: Credit
Administration
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ABN AMRO Bank N.V.
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Wire Transfer Instructions:
ABN AMRO Bank N.V.
New York, New York
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 650-001-1789-41
Attention: Chicago CPU
Ref: Proffits/Saks Inc.
BANKBOSTON, N.A.
By:
Name:
Title:
Lending Office:
BankBoston, N.A.
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Retail & Apparel Division
Mail Stop 01-09-05
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Attention: ▇▇. ▇▇▇▇▇▇▇▇ ▇.
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Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
BankBoston, N.A.
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ABA# 011 000 390
Attention: Commercial Loan
Services
Admin. 57
Reference: Saks Incorporated
FIFTH THIRD BANK
By:
Name:
Title:
Lending Office: Fifth Third Bank
38 Fountain Square Plaza
Maildrop 109054
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Attention: ▇▇▇▇ ▇. ▇▇▇▇,
Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Fifth Third Bank
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ABA# ▇▇▇▇▇▇▇▇▇
Account No.: ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Reference: Saks Incorporated
BANK OF MONTREAL
By:
Name:
Title:
Lending Office:
Bank of Montreal
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
▇▇▇▇▇▇ Trust & Savings Bank
Chicago, Illinois
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: ▇▇▇-▇▇▇-▇
Attention: Client Services
Reference: Saks Incorporated
MELLON BANK, N.A.
By:
Name:
Title:
Lending Office:
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▇ ▇▇▇▇▇▇ ▇▇▇▇ Center
Room 4525
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Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Mellon Bank, N.A.
Pittsburgh, Pennsylvania
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 990873800
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Reference: Saks Incorporated
FIRST UNION NATIONAL BANK
By:
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title:
By:
Name:
Title:
Lending Office:
First Union National Bank
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Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇
Wire Transfer Instructions:
First Union National Bank
Jacksonville, Florida
ABA No.: ▇▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Reference: Saks Incorporated
(▇▇▇▇▇▇▇▇'▇, Inc.)
Account Name: Commercial Loans
Account No.: GL145916 2008
STAR BANK, N.A.
By:
Name:
Title:
Lending Office:
Star Bank, N.A.
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Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Star Bank, N.A.
ABA# ▇▇▇-▇▇▇-▇▇▇
Account No.: 990-189 3
Reference: Saks Incorporated
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Loan
Operations
AMSOUTH BANK
By:
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
Lending Office:
AmSouth Bank
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
AmSouth Bank
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 001102450400100
Reference: Saks Incorporated
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
MERCANTILE BANK NATIONAL
ASSOCIATION
By:
Name:
Title:
Lending Office:
Mercantile Bank
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Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Mercantile Bank
St. Louis, Missouri
ABA# ▇▇▇▇▇▇▇▇▇
Account No.: 140117-939
Attention: Commercial Loan
Operations
Reference: