EXHIBIT 10.39
EXECUTION VERSION
================================================================================
CREDIT AGREEMENT
Dated as of September 30, 2002
among
McKESSON CORPORATION
and
McKESSON CANADA CORPORATION,
collectively, the Borrowers,
BANK OF AMERICA, N.A.,
as Administrative Agent,
BANK OF AMERICA, N.A. (ACTING THROUGH
ITS CANADIAN BRANCH), as Canadian Administrative Agent,
JPMORGAN CHASE BANK,
as Syndication Agent,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as L/C Issuer and Documentation Agent,
BANK ONE, NA,
as Documentation Agent,
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC,
as
Sole Lead Arranger and Sole Book Manager
================================================================================
TABLE OF CONTENTS
SECTION PAGE
------- ----
Article I. DEFINITIONS AND ACCOUNTING TERMS.............................................................. 1
1.01 Defined Terms................................................................................. 1
1.02 Other Interpretive Provisions................................................................. 20
1.03 Accounting Terms.............................................................................. 21
1.04 Rounding...................................................................................... 21
1.05 References to Agreements and Laws............................................................. 21
1.06 Times of Day.................................................................................. 22
1.07 Letter of Credit Amounts...................................................................... 22
Article II. THE COMMITMENTS AND CREDIT EXTENSIONS......................................................... 22
2.01 Committed Loans............................................................................... 22
2.02 Borrowings, Conversions and Continuations of Committed Loans.................................. 24
2.03 Letters of Credit............................................................................. 26
2.05 Prepayments................................................................................... 39
2.06 Termination or Reduction of Commitments....................................................... 40
2.07 Repayment of Loans............................................................................ 41
2.08 Interest...................................................................................... 41
2.09 Fees.......................................................................................... 42
2.10 Computation of Interest and Fees.............................................................. 42
2.11 Evidence of Debt.............................................................................. 43
2.12 Payments Generally............................................................................ 43
2.13 Sharing of Payments........................................................................... 45
2.14 Currency Exchange Fluctuations................................................................ 46
2.15 Increase in Commitments....................................................................... 46
2.16 Utilization of Commitments in Canadian Dollars................................................ 47
Article III. TAXES, YIELD PROTECTION AND ILLEGALITY........................................................ 48
3.01 Taxes......................................................................................... 48
3.02 Illegality.................................................................................... 49
3.03 Inability to Determine Rates.................................................................. 49
3.04 Increased Cost and Reduced Return; Capital Adequacy........................................... 50
i
3.05 Funding Losses................................................................................ 50
3.06 Matters Applicable to all Requests for Compensation........................................... 51
3.07 Survival...................................................................................... 51
Article IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS..................................................... 51
4.01 Conditions of Initial Credit Extension........................................................ 51
4.02 Conditions to all Credit Extensions........................................................... 53
Article V. REPRESENTATIONS AND WARRANTIES................................................................ 54
5.01 Corporate Existence and Power................................................................. 54
5.02 Corporate Authorization; No Contravention..................................................... 55
5.03 Governmental Authorization.................................................................... 55
5.04 Binding Effect................................................................................ 55
5.05 Litigation.................................................................................... 55
5.06 No Default.................................................................................... 56
5.07 Use of Proceeds; Margin Regulations........................................................... 56
5.08 Financial Condition........................................................................... 56
5.09 Regulated Entities............................................................................ 56
5.10 No Burdensome Restrictions.................................................................... 56
5.11 Subsidiaries and Certain Liens As of the Closing Date......................................... 57
5.12 Disclosed Matters............................................................................. 57
Article VI. AFFIRMATIVE COVENANTS......................................................................... 57
6.01 Financial Statements.......................................................................... 57
6.02 Certificates; Other Information............................................................... 58
6.03 Notices....................................................................................... 58
6.04 Preservation of Existence, Etc................................................................ 59
6.05 Maintenance of Insurance...................................................................... 60
6.06 Payment of Taxes.............................................................................. 60
6.07 Compliance with Laws.......................................................................... 60
6.08 Books and Records............................................................................. 60
6.09 Inspection Rights............................................................................. 60
6.10 Use of Proceeds............................................................................... 60
Article VII. NEGATIVE COVENANTS............................................................................ 61
7.01 Liens......................................................................................... 61
7.02 Consolidations and Mergers.................................................................... 62
ii
7.03 Use of Proceeds............................................................................... 62
7.04 Maximum Debt to Capitalization Ratio.......................................................... 62
7.05 Swap Contracts................................................................................ 63
Article VIII. EVENTS OF DEFAULT AND REMEDIES................................................................ 63
8.01 Events of Default............................................................................. 63
8.02 Remedies Upon Event of Default................................................................ 64
8.03 Application of Funds.......................................................................... 65
Article IX. ADMINISTRATIVE AGENT.......................................................................... 66
9.01 Appointment and Authorization of Agents....................................................... 66
9.02 Delegation of Duties.......................................................................... 67
9.03 Liability of Agents........................................................................... 67
9.04 Reliance by Agents............................................................................ 67
9.05 Notice of Default............................................................................. 68
9.06 Credit Decision; Disclosure of Information by Agents.......................................... 68
9.07 Indemnification of Agents..................................................................... 68
9.08 Agents in Their Individual Capacities......................................................... 69
9.09 Successor Agents.............................................................................. 69
9.10 Administrative Agent May File Proofs of Claim................................................. 70
9.11 Other Agents; Arrangers and Managers.......................................................... 70
Article X. THE COMPANY'S GUARANTY OF MCKESSON CANADA'S OBLIGATIONS....................................... 71
10.01 Guaranty of the Guarantied Obligations........................................................ 71
10.02 Liability of the Company Absolute............................................................. 71
10.03 Waivers by the Company........................................................................ 73
10.04 Payment by the Company; Application of Payments............................................... 74
10.05 Guarantor's Rights of Subrogation, Contribution, Etc.......................................... 75
10.06 Subordination of Other Obligations............................................................ 75
10.07 Real Property Security........................................................................ 75
10.08 Expenses...................................................................................... 76
10.09 Continuing Guaranty; Termination of Guaranty.................................................. 76
10.10 Authority of the Company or McKesson Canada................................................... 76
10.11 Financial Condition of McKesson Canada........................................................ 76
10.12 Rights Cumulative............................................................................. 76
iii
10.13 Bankruptcy; Post-Petition Interest; Reinstatement of Guaranty................................. 77
Article XI. MISCELLANEOUS................................................................................. 77
11.01 Amendments, Etc............................................................................... 77
11.02 Notices and Other Communications; Facsimile Copies............................................ 79
11.03 No Waiver; Cumulative Remedies................................................................ 80
11.04 Attorney Costs, Expenses and Taxes............................................................ 80
11.05 Indemnification by the Borrowers.............................................................. 80
11.06 Payments Set Aside............................................................................ 81
11.07 Successors and Assigns........................................................................ 82
11.08 Confidentiality............................................................................... 85
11.09 Set-off....................................................................................... 86
11.10 Interest Rate Limitation...................................................................... 86
11.11 Counterparts.................................................................................. 87
11.12 Integration................................................................................... 87
11.13 Survival of Representations and Warranties.................................................... 87
11.14 Severability.................................................................................. 87
11.15 Tax Forms..................................................................................... 87
11.16 Replacement of Lenders........................................................................ 89
11.17 Governing Law................................................................................. 90
11.18 Waiver of Right to Trial by Jury.............................................................. 90
11.19 Judgment...................................................................................... 91
iv
SCHEDULES
1.01 Existing Letters of Credit
2.01 Commitments and Pro Rata Shares
5.11 Subsidiaries and Indebtedness Secured by Liens
11.02 Administrative Agent's Office, Certain Addresses for Notices
EXHIBITS
FORM OF
A Committed Loan Notice
B-1 Note (McKesson Corporation)
B-2 Note (McKesson Canada Corporation)
C Opinion Matters
D Compliance Certificate
E Assignment and Assumption
F Drawing Notice
v
CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of September 30,
2002, among McKESSON CORPORATION, a Delaware corporation (the "Company"),
McKESSON CANADA CORPORATION, an Ontario corporation and indirect wholly owned
subsidiary of the Company ("McKesson Canada" and, together with the Company, the
"Borrowers" and each a "Borrower"), each lender from time to time party hereto
(collectively, the "Lenders" and individually, a "Lender"), BANK OF AMERICA,
N.A. (acting through its Canadian branch), as Canadian Administrative Agent with
respect to the Canadian Loans and the Bankers' Acceptance Facility (as
hereinafter defined), BANK OF AMERICA, N.A., as Administrative Agent, and
WACHOVIA BANK, National Association, as L/C Issuer.
The Borrowers have requested that the Lenders provide a revolving
credit facility, and the Lenders are willing to do so on the terms and
conditions set forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"364-Day Credit Facility" means that certain Credit Agreement dated as
of September 30, 2002, by and among the Company, Bank of America, as
administrative agent, and the financial institutions listed on the signature
pages thereof, as such agreement may be amended, modified or supplemented from
time to time.
"Administrative Agent" means Bank of America, N.A. in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Acceptance Usage" means, as at any date of determination, the
aggregate Face Amount of all completed Bankers' Acceptances which have not been
repaid by McKesson Canada whether or not due and whether or not held by a
Lender. For purposes of this definition, any Bankers' Acceptance that has been
prepaid in full shall not be deemed to be outstanding and all Bankers'
Acceptances shall be valued in Dollar Equivalents as of the applicable
Computation Date.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 11.02, or such
other address or account as the Administrative Agent may from time to time
notify the Borrowers and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto.
"Agent-Related Persons" means the Administrative Agent and the Canadian
Administrative Agent and any successor agent arising under Section 9.09,
together with their respective Affiliates (including, in the case of Bank of
America in its capacity as the Administrative Agent, the Arranger), and the
officers, directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agents" means the Administrative Agent and the Canadian Administrative
Agent.
"Aggregate Canadian Commitments" means the aggregate Canadian
Commitments of all the Lenders, which is an amount equal to $150,000,000 on the
Closing Date. The Aggregate Canadian Commitments are a part of, and not an
addition to, the Aggregate Commitments.
"Aggregate Commitments" means the aggregate Commitments of all the
Lenders.
"Agreement" means this Credit Agreement.
"Applicable Agent" means (1) the Administrative Agent in the case of
Domestic Loans and Letters of Credit and (2) the Canadian Administrative Agent
in the case of Canadian Loans and in connection with the Bankers' Acceptance
Facility.
"Applicable Borrower" means (1) the Company in the case of Domestic
Loans and Letters of Credit and (2) McKesson Canada in the case of Canadian
Loans and Bankers' Acceptances.
"Applicable Currency" means, as to any particular payment or Loan,
Dollars in the case of Domestic Loans and Letters of Credit and Canadian Dollars
in the case of Canadian Loans and the Bankers' Acceptance Facility.
"Applicable Rate" means, from time to time, the rate, expressed in
basis points per annum, corresponding to the applicable Debt Rating as set forth
below:
2
EURODOLLAR
RATE +
----------
LETTERS BASE RATE/
DEBT RATINGS OF CREDIT/ CANADIAN
PRICING S&P/ FACILITY BANKERS' PRIME
LEVEL ▇▇▇▇▇'▇ FEE ACCEPTANCES RATE +
--------- ---------------------- ------------ --------------- -------------
1 A/A2 or higher 10 40 0
2 A-/A3 11 44 0
3 BBB+/Baa1 13 49.5 0
4 BBB/Baa2 15 60 0
5 BBB-/Baa3 20 80 0
6 less than BBB-/Baa3 25 100 0
"Debt Rating" means, as of any date of determination, the
ratings as determined by S&P and ▇▇▇▇▇'▇ (collectively, the "Debt
Ratings") of the Company's non-credit-enhanced, senior unsecured
long-term debt; provided that, if the Debt Ratings result in two
different Pricing Levels, the higher of such Debt Ratings shall apply
(with the Debt Rating for Pricing Level 1 being the highest and the
Debt Rating for Pricing Level 6 being the lowest), unless there is a
split in Debt Ratings of more than one level, in which case the Pricing
Level that is one level higher than the Pricing Level of the lower Debt
Rating shall apply.
Initially, the Applicable Rate shall be determined based upon the Debt Rating
specified in the certificate delivered pursuant to Section 4.01(a)(vi).
Thereafter, each change in the Applicable Rate resulting from a publicly
announced change in the Debt Rating shall be effective, in the case of an
upgrade, during the period commencing on the date of delivery by the Company to
the Administrative Agent of notice thereof pursuant to Section 6.03(e) and
ending on the date immediately preceding the effective date of the next such
change and, in the case of a downgrade, during the period commencing on the date
of the public announcement thereof and ending on the date immediately preceding
the effective date of the next such change.
"Arranger" means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit E.
"Attorney Costs" means and includes all fees, expenses and
disbursements of any law firm or other external counsel and, without
duplication, the allocated cost of internal legal services and all expenses and
disbursements of internal counsel; provided that no fees, expenses or
disbursements shall qualify as Attorney Costs unless written evidence
substantiating such fees, expenses and disbursements is available to the Company
upon request.
"Attributable Indebtedness" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease
3
Obligation, the capitalized amount of the remaining lease payments under the
relevant lease that would appear on a balance sheet of such Person prepared as
of such date in accordance with GAAP if such lease were accounted for as a
capital lease.
"Audited Financial Statements" means the audited consolidated balance
sheet of the Company and its Subsidiaries for the fiscal year ended March 31,
2002, and the related consolidated statements of operations, shareholders'
equity and cash flows for such fiscal year of the Company and its Subsidiaries,
including the notes thereto.
"Availability Period" means the period from and including the Closing
Date to the earliest of (a) the Maturity Date, (b) the date of termination of
the Aggregate Commitments pursuant to Section 2.06, and (c) the date of
termination of the commitment of each Lender to make Loans and of the obligation
of the of the L/C Issuer to make L/C Credit Extensions pursuant to Section 8.02.
"BA Canada" means Bank of America, N.A. (acting through its Canadian
branch), and its successors.
"Bank of America" means Bank of America, N.A. and its successors.
"Bankers' Acceptance" has the meaning set forth in Section 2.04(a).
"Bankers' Acceptance Credit Extension" means, with respect to any
Bankers' Acceptance, the acceptance thereof or extension of the Drawing Date
thereof or the renewal or increase of the amount thereof.
"Bankers' Acceptance Facility" means the facility established by
Section 2.04(a).
"Base Rate" means for any day a fluctuating rate per annum equal to
the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its "prime rate." The "prime rate" is a rate set by Bank of
America based upon various factors including Bank of America's costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in such rate announced by Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Committed Loan" means a Committed Loan that is a Base Rate
Loan.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Beneficiary" means, in relation to a Letter of Credit, from time to
time, the initial beneficiary, a transferee beneficiary, a successor
beneficiary, a nominated bank, a negotiating bank or a confirming bank with
respect to such Letter of Credit, as applicable.
"Borrower" has the meaning specified in the introductory paragraph
hereto.
4
"Borrowing" means a borrowing consisting of simultaneous Committed
Loans of the same Type and, in the case of Eurodollar Rate Loans, having the
same Interest Period made by each of the Lenders pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, Charlotte, North Carolina or San Francisco, California, or, in
the case of Canadian Loans or in connection with the Bankers' Acceptance
Facility, Toronto or Montreal, are authorized or required by law to close and,
if such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.
"Canadian Administrative Agent" means BA Canada, in its capacity as the
Canadian administrative agent for the Canadian Lenders, and any successor
Canadian administrative agent.
"Canadian Administrative Agent's Office" means the Canadian
Administrative Agent's address and, as appropriate, account as set forth on
Schedule 11.02, or such other address or account as the Canadian Administrative
Agent may from time to time notify the Borrowers and Canadian Lenders.
"Canadian Commitment" means, as to each Canadian Lender, an aggregate
amount equal to the amount set forth opposite its name in the column under the
heading "Canadian Commitments" on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as such amount may be adjusted from time to time in accordance with this
Agreement.
"Canadian Dollars" and "Cdn.$" each means the lawful money of Canada.
"Canadian Exposure" means, as to any Canadian Lender (a) prior to the
termination of the Canadian Commitment, such Canadian Lender's Canadian
Commitment and (b) after the termination of the Canadian Commitment, the Total
Canadian Outstandings for such Canadian Lender.
"Canadian Lender" means each Canadian bank listed on Schedule 2.01 as a
Canadian Lender, and their successors and assigns.
"Canadian Loan" means any Loan made to McKesson Canada pursuant to
Section 2.01(b) denominated in Canadian Dollars which may be a Eurodollar Rate
Loan or a Canadian Prime Rate Loan.
"Canadian Participant" has the meaning set forth in Section
2.01(b)(ii).
"Canadian Participation" has the meaning set forth in Section
2.01(b)(ii).
"Canadian Prime Rate" means, for any day, with respect to any Canadian
Loan, a fluctuating rate per annum equal to the higher of (a) the rate announced
by the Canadian Administrative Agent from time to time as its prime lending
rate, as in effect from time to time, and (b) a rate equal to the CDOR that
would apply to a one-month Bankers' Acceptance
5
accepted by BA Canada if made on such day plus 0.75% per annum. As to any loan,
the Canadian Prime Rate is a reference rate and does not necessarily represent
the lowest or best rate actually charged to any customer. The Canadian
Administrative Agent may make commercial loans or other loans at rates of
interest at, above or below the Canadian Prime Rate. Any change in the reference
rate announced by the Canadian Administrative Agent shall take effect at the
opening of business on the day specified in the announcement of such change.
"Canadian Prime Rate Loans" means Canadian Loans bearing interest at
rates determined by reference to the Canadian Prime Rate.
"Canadian Pro Rata Share" means, as to any Canadian Lender at any time,
the percentage equivalent (expressed as a decimal, rounded to the ninth decimal
place) at such time of such Canadian Lender's Canadian Exposure divided by the
combined Canadian Exposure of all Canadian Lenders (including, in each case,
Canadian Exposure of Affiliates of Canadian Lenders).
"Canadian Resident" shall mean a Person that is either (i) a resident
of Canada for purposes of the Income Tax Act (Canada) or (ii) the Canadian
branch of an authorized foreign bank that will receive all amounts contemplated
under this agreement as part of its Canadian banking business for purposes of
the Income Tax Act (Canada).
"Canadian Spot Rate" means the rate quoted by Bank of America as the
spot rate for the purchase by Bank of America of such currency with another
currency through its FX Trading Office at approximately 8:00 a.m. on the date
two Business Days prior to the Computation Date.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"CDOR" means, for any day and relative to Bankers' Acceptances having
any specified Face Amount and maturity, the average of the annual rates for
Bankers' Acceptances having such specified Face Amount and maturity (or a Face
Amount and maturity as closely as possible comparable to such specified Face
Amount and maturity) of the banks named in Schedule I to the Bank Act (Canada)
that appears on the Reuters Screen CDOR page as of at 10:00 a.m. on such day
(or, if such day is not a Business Day, as of 10:00 a.m. on the next preceding
Business Day), provided that if such rate does not appear on the Reuters Screen
CDOR page at such time on such date, CDOR for such date will be the annual rate
of interest (rounded upward to the nearest whole multiple of 1/100 of 1%
calculated) as of 10:00 a.m. on such date on the basis of the discount amount at
which the Canadian Administrative Agent is then offering to purchase Bankers'
Acceptances accepted by it having a comparable aggregate Face Amount and
identical maturity date to the aggregate Face Amount and maturity date of such
Bankers' Acceptances.
"Clearing House" means The Canadian Depository for Securities Limited,
or such alternative clearing house within the meaning of The Depository Bills
and Notes Act (Canada).
"Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 4.01 (or, in the
case of Section 4.01(b), waived by the Person entitled to receive the applicable
payment).
"Code" means the Internal Revenue Code of 1986.
6
"Commitment" means, as to each Lender, its obligation to (a) make
Committed Loans (including, without limitation, any Canadian Commitment of any
Canadian Lender to make Canadian Loans or purchase Bankers' Acceptances) to the
Borrowers pursuant to Article II and (b) purchase participations in L/C
Obligations, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement. The Commitment for any Lender that has an
Affiliate is a single value for such Lender and its Affiliate taken together.
"Committed Loan" means a Domestic Loan or a Canadian Loan.
"Committed Loan Notice" means a notice of (a) a Borrowing, (b) a
conversion of Committed Loans from one Type to the other, or (c) a continuation
of Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing,
shall be substantially in the form of Exhibit A.
"Company" has the meaning specified in the introductory clause hereto.
"Company Guaranty" means the Company's guaranty of the Obligations of
McKesson Canada under this agreement, the terms of which guaranty are located in
Article X of this Agreement.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit D.
"Computation Date" has the meaning specified in Section 2.16(a).
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" has the meaning specified in the definition of "Affiliate."
"Credit Extension" means each of the following: (a) a Borrowing, (b) a
Bankers' Acceptance Credit Extension and (c) an L/C Credit Extension.
"Debt Rating" has the meaning set forth in the definition of
"Applicable Rate."
"Debtor Relief Laws" means the Bankruptcy Code of the United States,
the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement
Act (Canada) and all other liquidation, conservatorship, bankruptcy, assignment
for the benefit of creditors, moratorium, rearrangement, receivership,
insolvency, reorganization, or similar debtor relief Laws of the United States
or other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
7
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 1% per
annum; provided, however, that with respect to a Eurodollar Rate Loan or
Canadian Prime Rate Loan, the Default Rate shall be an interest rate equal to
the interest rate (including any Applicable Rate) otherwise applicable to such
Loan plus 1% per annum, in each case to the fullest extent permitted by
applicable Laws.
"Defaulting Lender" means (i) any Lender that (a) has failed to fund
any portion of the Committed Loans or participations in L/C Obligations required
to be funded by it hereunder within one Business Day of the date required to be
funded by it hereunder, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within one Business Day of the date when due, unless the subject of
a good faith dispute, or (c) has been deemed insolvent or become the subject of
a bankruptcy or insolvency proceeding and (ii) any Canadian Lender that has
failed to purchase any Draft or Banker's Acceptance.
"Disclosed Matters" means (i) those matters described in the Company's
press release dated April 28, 1999 (the "Press Release"), (ii) litigation which
(A) is related to the matters disclosed in the Press Release and (B) has been
disclosed to the Administrative Agent and the Lenders prior to the Closing Date,
and (iii) other matters related to the matters disclosed in the Press Release
which have been publicly disclosed by the Company in its filings with the SEC
prior to the Closing Date.
"Dollar" and "$" mean lawful money of the United States.
"Dollar Equivalent" means, at any time, (a) as to any amount
denominated in Dollars, the amount thereof at such time, and (b) as to any
amount denominated in Canadian Dollars, the equivalent amount in Dollars as
determined by the Applicable Agent at such time on the basis of the Canadian
Spot Rate for the purchase of Dollars with Canadian Dollars on the most recent
Computation Date provided for in Section 2.16(a).
"Domestic Lender" means each Lender acting in the capacity of a
domestic lender listed on Schedule 2.01 as a Domestic Lender, and their
successors and assigns.
"Domestic Loan" means any Loan made to the Company pursuant to Section
2.01(a) denominated in Dollars which may be a Eurodollar Rate Loan or a Base
Rate Loan.
"Draft" means, at any time, a ▇▇▇▇ of exchange, within the meaning of
the Bills of Exchange Act (Canada) drawn by McKesson Canada to be accepted by a
Canadian Lender (which upon such acceptance will be a Bankers' Acceptance) and
bearing such distinguishing letters and numbers as such Canadian Lender may
determine, but which at such time, except as otherwise provided herein, has not
been accepted by a Canadian Lender.
"Drawing" means an acceptance of completed Drafts by a Canadian Lender
or by any other Person pursuant to Section 2.04.
"Drawing Date" means any Business Day fixed pursuant to Section 2.04(b)
for a Drawing.
8
"Drawing Fee" means, with respect to the Drafts issued by McKesson
Canada hereunder and accepted as provided herein on any Drawing Date, an amount
equal to the Drawing Fee Rate multiplied by the aggregate Face Amount of such
Drafts, calculated, in each case, on the basis of the term to maturity of such
Draft and a year of 365 or 366 days, as the case may be (rounded to the nearest
whole cent, with one-half of one cent being rounded up).
"Drawing Fee Rate" means, in calculating the Drawing Fee for any Draft,
the Applicable Rate for Bankers' Acceptances.
"Drawing Notice" has the meaning set forth in Section 2.04(b)(i).
"Drawing Purchase Price" means, in respect of Drafts to be accepted by
a Canadian Lender or any other Person, the difference between (i) the result
(rounded to the nearest whole cent, with one-half of one cent being rounded up)
obtained by dividing the aggregate Face Amount of such Drafts by the sum of one
plus the product of (x) the Effective Discount Rate multiplied by (y) a fraction
the numerator of which is the term of maturity of such Drafts and the
denominator of which is 365; and (ii) the applicable Drawing Fee.
"Effective Discount Rate" means (a) with respect to any Bankers'
Acceptance accepted by a Canadian Lender named on Schedule I to the Bank Act
(Canada), the rate determined by the Canadian Administrative Agent as being CDOR
on the applicable Drawing Date, and (b) with respect to any Bankers' Acceptance
accepted by any other Canadian Lender, the lesser of (i) the rate advised by
such Canadian Lender to the Canadian Administrative Agent as being the discount
rate of such Canadian Lender, calculated on the basis of a year of 365 or 366
days, as applicable, and determined in accordance with normal market practice,
for bankers' acceptances of such Lender having comparable Face Amount and
identical maturity date to the Face Amount and maturity date of such Bankers'
Acceptance and (ii) the rate determined by the Canadian Administrative Agent in
accordance with clause (a) above plus 0.07% per annum.
"Eligible Assignee" has the meaning specified in Section 11.07(g).
"Environmental Laws" means any and all Federal, state, provincial,
municipal, local, and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or governmental restrictions relating to pollution and the protection
of the environment or the release of any materials into the environment,
including those related to hazardous substances or wastes, air emissions and
discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in
9
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Company or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of a
notice of intent to terminate, the treatment of a Plan amendment as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon the Company or any ERISA Affiliate.
"Eurodollar Base Rate" has the meaning set forth in the definition of
Eurodollar Rate.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent
pursuant to the following formula:
Eurodollar Base Rate
Eurodollar Rate = ------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Base Rate" means, for such Interest Period:
(a) the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate that appears on the
page of the Telerate screen (or any successor thereto) that displays an
average British Bankers Association Interest Settlement Rate for
deposits in the Applicable Currency (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, or
(b) if the rate referenced in the preceding clause (a)
does not appear on such page or service or such page or service shall
not be available, the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate on such other page or
other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in the Applicable Currency (for
delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period, or
(c) if the rates referenced in the preceding clauses (a)
and (b) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest at which deposits in the
Applicable Currency for delivery on the first day of such Interest
Period in same day funds in the approximate amount of the Eurodollar
Rate Loan being made, continued or converted by Bank of America and
with a term equivalent to such Interest Period would be offered by Bank
of America's London Branch to major
10
banks in the London interbank eurodollar market at their request at
approximately 4:00 p.m. (London time) two Business Days prior to the
first day of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any
Interest Period (A) in the case of Domestic Loans, the reserve
percentage (expressed as a decimal, carried out to five decimal places)
in effect on such day, whether or not applicable to any Domestic
Lender, under regulations issued from time to time by the FRB for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect to
Eurocurrency funding (currently referred to as "Eurocurrency
liabilities") and (B) in the case of Canadian Loans, the reserve
percentage (expressed as a decimal, carried out to five decimal places)
in effect on such day, whether or not applicable to any Canadian
Lender, under any applicable regulations of the central bank or other
relevant Government Authority in Canada. The Eurodollar Rate for each
outstanding Eurodollar Rate Loan shall be adjusted automatically as of
the effective date of any change in the Eurodollar Reserve Percentage.
"Eurodollar Rate Loan" means a Committed Loan that bears interest at a
rate based on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 8.01.
"Existing Credit Agreements" means (a) that certain Credit Agreement,
dated as of November 10, 1998, among the Company, Medis Health and
Pharmaceutical Services, Inc. (now known as McKesson Canada Corporation), Bank
of America, as agent, Bank of America Canada, as Canadian administrative agent,
and the lenders party thereto as amended to date and (b) that certain Credit
Agreement, dated as of October 22, 1999, among the Company, Bank of America, as
agent, and the lenders party thereto, as amended.
"Existing Letters of Credit" means those letters of credit issued prior
to the date hereof for the account of the Company or one of its Subsidiaries and
identified on Schedule 1.01.
"Exposure" means (a) prior to the termination of the Commitment, such
Lender's Commitment and (b) after the termination of the Commitment, the Total
Outstandings for such Lender.
"Face Amount" means, in respect of a Draft or a Bankers' Acceptance, as
the case may be, the amount payable to the holder thereof on its maturity.
"Federal Funds Rate" means, for any day, the rate per annum 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 on the Business Day next
succeeding such day; provided that (a) 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 (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the weighted average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.
11
"Fee Letter" means the letter agreement, dated August 28, 2002, among
the Company, the Administrative Agent and the Arranger.
"Foreign Lender" has the meaning specified in Section 11.15(a)(i).
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"FX Trading Office" means the Foreign Exchange Trading Unit of Bank of
America located in London, England, or such other of Bank of America's offices
as Bank of America may designate from time to time or, if Bank of America is no
longer the Administrative Agent, the offices of Administrative Agent as
Administrative Agent may designate from time to time.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Granting Lender" has the meaning specified in Section 11.07(h).
"Guarantee" means, as to any Person, any (a) any obligation, contingent
or otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith. The term "Guarantee" as a verb has a corresponding meaning.
12
"Guarantied Obligations" has the meaning set forth in Section 10.01.
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following:
(a) all obligations of such Person for borrowed money;
(b) all obligations of such Person to pay the deferred
purchase price of property or services (other than trade accounts
payable in the ordinary course of business);
(c) all non-contingent reimbursement or payment
obligations of such Person arising under letters of credit (including
standby and commercial), bankers' acceptances, bank guaranties,
shipside bonds, surety bonds and similar instruments;
(d) all obligations of such Person evidenced by bonds,
debentures, notes, loan agreements or other similar instruments;
(e) capital leases and Synthetic Lease Obligations;
(f) net obligations of such Person under any Swap
Contract;
(g) all indebtedness created or arising under any
conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to property acquired by the
Person (even though the rights and remedies of the seller or bank under
such agreement in the event of default are limited to repossession or
sale of such property); and
(h) all indebtedness referred to in clauses (a) through
(g) above (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person, whether or not such
indebtedness shall have been assumed by such Person or is limited in
recourse.
For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person. The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date. The amount of any capital lease or Synthetic Lease
Obligation as of any date shall be deemed to be the amount of Attributable
Indebtedness in respect thereof as of such date.
"Indemnified Liabilities" has the meaning set forth in Section 11.05.
"Indemnitees" has the meaning set forth in Section 11.05.
"Insolvency Proceeding" means (a) any case, action or proceeding before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution, winding-up
or relief of debtors, or (b) any general assignment for the
13
benefit of creditors, composition, marshalling of assets for creditors, or other
similar arrangement in respect of its creditors generally or any substantial
portion of its creditors; undertaken under U.S. Federal, state or foreign law,
including the Bankruptcy Code of the United States.
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan or a Canadian Prime Rate Loan, the last day of each Interest Period
applicable to such Loan and the Maturity Date; provided, however, that if any
Interest Period for a Eurodollar Rate Loan exceeds three months, the respective
dates that fall every three months after the beginning of such Interest Period
shall also be Interest Payment Dates; and (b) as to any Base Rate Loan or
Canadian Prime Rate Loan, (i) the fifth Business Day following the end of each
calendar quarter and (ii) the Maturity Date.
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Applicable Borrower in its Committed
Loan Notice; provided that:
(i) any Interest Period that would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Business Day;
(ii) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at the end of such
Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity
Date.
"IRS" means the United States Internal Revenue Service.
"Laws" means, collectively, all international, foreign, Canadian,
Federal, state, provincial, municipal and local statutes, treaties, rules,
guidelines, regulations, ordinances, codes and administrative or judicial
precedents or authorities, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative
orders, directed duties, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authority, in each case whether or not having
the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's funding
of its participation in any L/C Borrowing in accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
14
"L/C Issuer" means Wachovia Bank, National Association in its capacity
as issuer of Letters of Credit hereunder, or any successor issuer of Letters of
Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings.
"Lender" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as its "Lending Office" or "Domestic Lending Office" or
"Eurodollar Lending Office," as the case may be, in such Lender's Administrative
Questionnaire, or such other office or offices as a Lender may from time to time
notify the Company and the Administrative Agent.
"Letter of Credit" means (i) any letter of credit issued hereunder and
(ii) each of the Existing Letters of Credit. A Letter of Credit may be a
commercial letter of credit or a standby letter of credit.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit in the form from time to time in
use by the L/C Issuer.
"Letter of Credit Expiration Date" means the day that is five Business
Days prior to the Maturity Date then in effect.
"Letter of Credit Sublimit" means an amount equal to $75,000,000. The
Letter of Credit Sublimit is part of, and not in addition to, the Aggregate
Commitments.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest of any kind or nature whatsoever (including
any conditional sale or other title retention agreement, and any financing lease
having substantially the same economic effect as any of the foregoing, but not
including the interest of a lessor under an operating lease or the sale of
accounts receivable).
"Loan" means an extension of credit by a Lender to a Borrower under
Article II in the form of a Committed Loan.
"Loan Documents" means this Agreement, any Notes, any Drafts, any
Bankers' Acceptances, the Fee Letter and all other documents delivered to the
Administrative Agent, Canadian Administrative Agent or any Lender in connection
herewith.
"Loan Parties" means, collectively, the Borrowers.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Master Agreement" has the meaning set forth in the definition of "Swap
Contract."
15
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Company and its Subsidiaries taken
as a whole or any Material Subsidiary; (b) a material impairment of the ability
of any Borrower to perform its obligations under any Loan Document to which it
is a party; or (c) a material adverse effect upon the legality, validity,
binding effect or enforceability against any Borrower of any Loan Document to
which it is a party.
"Material Subsidiary" means, at any time, (i) McKesson Canada and (ii)
any other Subsidiary having at such time 10% or more of the Company's
consolidated total (gross) revenues for the preceding four fiscal quarter
period, as of the last day of the preceding fiscal quarter based upon the
Company's most recent annual or quarterly financial statements delivered to the
Administrative Agent under Section 6.01.
"Maturity Date" means September 30, 2005.
"McKesson Canada" has the meaning specified in the introductory
paragraph hereto.
"Member" means a Canadian Lender that has entered into a contract of
membership with the Clearing House.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any successor
thereto.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Company or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.
"Net Worth" means the sum of the capital stock and additional paid in
capital plus retained earnings (or minus accumulated deficits) of the Company
and its Subsidiaries determined on a consolidated basis in conformity with GAAP
on such date.
"Note" means a promissory note executed by a Borrower in favor of a
Lender pursuant to Section 2.11, substantially in the form of Exhibit B-1 in the
case of the Company with respect to Domestic Loans or substantially in the form
of Exhibit B-2 in the case of McKesson Canada with respect to Canadian Loans.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan, Draft, Bankers' Acceptance or
Letter of Credit, whether direct or indirect (including those acquired by
assumption), absolute or contingent, due or to become due, now existing or
hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding.
"Organization Documents" means, with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction).
16
"Other Taxes" has the meaning specified in Section 3.01(b).
"Outstanding Amount" means (i) with respect to Committed Loans and on
any date, the aggregate outstanding principal amount thereof after giving effect
to any borrowings and prepayments or repayments of Committed Loans occurring on
such date; (ii) with respect to any Bankers' Acceptances on any date, the amount
of the Acceptance Usage on such date after giving effect to any Bankers'
Acceptance Credit Extension occurring on such date and any other changes in the
aggregate amount of the Acceptance Usage as of such date, including as a result
of any reimbursements of outstanding unpaid drawings under any Bankers'
Acceptance or any reductions in the maximum amount available for drawing under
Bankers' Acceptance taking effect on such date; and (iii) with respect to any
L/C Obligations on any date, the amount of such L/C Obligations on such date
after giving effect to any L/C Credit Extension occurring on such date and any
other changes in the aggregate amount of the L/C Obligations as of such date,
including as a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.
"Overnight Canadian Rate" means, for any day, the rate of interest per
annum at which overnight deposits in Canadian Dollars, in an amount
approximately equal to the amount with respect to which such rate is being
determined, would be offered for such day by the Administrative Agent's London
Branch to major banks in the London or other applicable offshore interbank
market.
"Participant" has the meaning specified in Section 11.07(d).
"Participation Funding Date" has the meaning specified in Section
2.01(b)(ii)(A).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Company or
any ERISA Affiliate or to which the Company or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by any Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"Press Release" has the meaning specified in the definition of
"Disclosed Matters" set forth herein.
"Pro Rata Share" means, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the
17
Commitment of such Lender at such time and the denominator of which is the
amount of the Aggregate Commitments at such time; provided that if the
Commitment of each Lender to make Loans, the obligation of the Canadian Lenders
to make Bankers' Acceptance Credit Extensions and the obligation of the L/C
Issuer to make L/C Credit Extensions have been terminated pursuant to Section
8.02, then the Pro Rata Share of each Lender shall be determined based on the
Pro Rata Share of such Lender immediately prior to such termination and after
giving effect to any subsequent assignments made pursuant to the terms hereof.
The initial Pro Rata Share of each Lender is set forth opposite the name of such
Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which
such Lender becomes a party hereto, as applicable.
"Proceedings" has the meaning set forth in Section 6.03(c).
"Register" has the meaning set forth in Section 11.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to a Bankers' Acceptance, a Drawing Notice and (c) with respect to an
L/C Credit Extension, a Letter of Credit Application.
"Required Lenders" means, as of any date of determination, Lenders
having more than 50% of the Aggregate Commitments or, if the Commitment of each
Lender to make Loans, the obligation of each Canadian Lender to make Bankers'
Acceptance Credit Extensions and the obligation of the L/C Issuer to make L/C
Credit Extensions have been terminated pursuant to Section 8.02, Lenders holding
in the aggregate more than 50% of the Total Outstandings (with the aggregate
amount of each Lender's risk participation and funded participation in Bankers'
Acceptances and L/C Obligations being deemed "held" by such Lender for purposes
of this definition); provided that the Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination, decree or order of an
arbitrator or of a Governmental Authority, in each case applicable to or binding
upon the Person or any of its property or to which the Person or any of its
property is subject, including but not limited to any Environmental Law.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, corporate vice president or the treasurer of a Loan
Party. Any document delivered hereunder that is signed by a Responsible Officer
of a Loan Party shall be conclusively presumed to have been authorized by all
necessary corporate, partnership and/or other action on the part of such Loan
Party and such Responsible Officer shall be conclusively presumed to have acted
on behalf of such Loan Party.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. and any successor thereto.
18
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"SPC" has the meaning specified in Section 11.07(h).
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company, unlimited liability company or other
business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other
governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned, or
the management of which is otherwise controlled, directly, or indirectly through
one or more intermediaries, or both, by such Person. Unless otherwise specified,
all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a
Subsidiary or Subsidiaries of the Company.
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement relating to any of the
foregoing (any such master agreement, together with any related schedules, a
"Master Agreement"), including any such obligations or liabilities under any
Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
▇▇▇▇-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"Taxes" has the meaning specified in Section 3.01(a).
19
"Total Canadian Outstandings" means (i) as to all Lenders at any date
of determination, the sum of (A) the aggregate principal amount of all
outstanding Canadian Loans plus (B) the Acceptance Usage, in each case valued in
Dollar Equivalents, and (ii) as to any Lender at any date of determination, the
sum of (x) the aggregate principal amount of all Canadian Loans made by such
Canadian Lender or its Affiliate plus (y) the Acceptance Usage of such Canadian
Lender or its Affiliate, in each case valued in Dollar Equivalents.
"Total Capitalization" means, on any date, the sum of (a) Total Debt
and (b) the Net Worth on such date.
"Total Debt" means, on any date, all Indebtedness of the Company and
its Subsidiaries determined on a consolidated basis on such date.
"Total Outstandings" means (i) as to all Lenders at any date of
determination, the sum of (A) the Outstanding Amount of all Loans and L/C
Obligations plus (B) the Acceptance Usage, in each case valued in Dollar
Equivalents, and (ii) as to any Lender at any date of determination, the sum of
(x) the Outstanding Amount of all Loans and L/C Obligations of such Lender or
its Affiliate plus (y) the Acceptance Usage of such Lender or its Affiliate, in
each case valued in Dollar Equivalents.
"Type" means (i) with respect to a Domestic Loan, its character as a
Base Rate Loan or a Eurodollar Rate Loan and (ii) with respect to a Canadian
Loan, its character as a Canadian Prime Rate Loan or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
"Wholly-Owned Subsidiary" means any Subsidiary in which (other than
directors' qualifying shares required by law) 100% of the capital stock of each
class or other interests having ordinary voting power, and 100% of the capital
stock of every other class or other interests, in each case, at the time as of
which any determination is being made, is owned, beneficially and of record, by
the Company, or by one or more of the other Wholly-Owned Subsidiaries, or both.
1.02 OTHER INTERPRETIVE PROVISIONS. With reference to this
Agreement and each other Loan Document, unless otherwise specified herein or in
such other Loan Document:
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
20
(b) (i) The words "herein," "hereto," "hereof" and
"hereunder" and words of similar import when used in any Loan Document shall
refer to such Loan Document as a whole and not to any particular provision
thereof.
(ii) Article, Section, Exhibit and Schedule references are
to the Loan Document in which such reference appears.
(iii) The term "including" is by way of example and not
limitation.
(iv) The term "documents" includes any and all
instruments, documents, agreements, certificates, notices, reports,
financial statements and other writings, however evidenced, whether in
physical or electronic form.
(c) In the computation of periods of time from a specified date to
a later specified date, the word "from" means "from and including;" the words
"to" and "until" each mean "to but excluding;" and the word "through" means "to
and including."
(d) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS. (a) All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
(b) If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document, and either
the Company or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Company shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Company shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
1.04 ROUNDING. Any financial ratios required to be maintained by
the Company pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to Organization Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments,
21
restatements, extensions, supplements and other modifications thereto, but only
to the extent that such amendments, restatements, extensions, supplements and
other modifications are not prohibited by any Loan Document; and (b) references
to any Law shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Law.
1.06 TIMES OF DAY. Unless otherwise specified, all references
herein to times of day shall be references to Pacific time (daylight or
standard, as applicable).
1.07 LETTER OF CREDIT AMOUNTS. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to mean the maximum face amount of such Letter of Credit after giving
effect to all increases thereof contemplated by such Letter of Credit or the
Letter of Credit Application therefor, whether or not such maximum face amount
is in effect at such time.
ARTICLE II.
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 COMMITTED LOANS.
(a) Subject to the terms and conditions set forth herein, each
Lender severally agrees to make Domestic Loans to the Company from time to time,
on any Business Day during the Availability Period, in an aggregate amount not
to exceed at any time outstanding the amount of such Lender's Commitment;
provided, however, that after giving effect to any Borrowing, (i) the Total
Outstandings shall not exceed the Aggregate Commitments, and (ii) the aggregate
Outstanding Amount of the Committed Loans of any Lender, plus such Lender's Pro
Rata Share of the Outstanding Amount of all L/C Obligations and all Bankers'
Acceptances (taking into account any Canadian Participations when determining
the Total Canadian Outstandings of a Canadian Lender) shall not exceed such
Lender's Commitment. Within the limits of each Lender's Commitment, and subject
to the other terms and conditions hereof, the Company may borrow under this
Section 2.01(a), prepay under Section 2.05, and reborrow under this Section
2.01(a). Domestic Loans may be Base Rate Loans or Eurodollar Rate Loans, as
further provided herein.
(b)(i) Subject to the terms and conditions set forth herein,
each Canadian Lender severally agrees to make Canadian Loans to
McKesson Canada from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender's Canadian Commitment; provided,
however, that after giving effect to any Borrowing under the Canadian
Commitments, (A) the Total Outstandings shall not exceed the Aggregate
Commitments, (B) the Total Canadian Outstandings shall not exceed the
Aggregate Canadian Commitments, (C) McKesson Canada shall be a
Wholly-Owned Subsidiary, (D) the aggregate Outstanding Amount of the
Canadian Loans of any Canadian Lender, plus such Lender's Pro Rata
Share of the Acceptance Usage (taking into account any Canadian
Participations when determining the Total Canadian Outstandings of a
Canadian Lender) shall not exceed its Canadian Commitment, and (E) all
Canadian Loans to McKesson Canada shall be made by the Canadian
Lenders, shall be denominated and payable in Canadian Dollars and no
22
other currency and shall not be Base Rate Loans. Within the limits of
each Lender's Canadian Commitment, and subject to the other terms and
conditions hereof, McKesson Canada may borrow under this Section
2.01(b)(i), prepay under Section 2.05 and reborrow under this Section
2.01(b)(i). Canadian Loans may be Canadian Prime Rate Loans or
Eurodollar Rate Loans, as provided herein.
(ii)(A) Subject to Section 2.01(b)(ii)(B) below, on
the Participation Funding Date (as defined below) each Lender
that is not a Canadian Lender shall be deemed to have
purchased, and hereby agrees to purchase, a participation in
each outstanding Canadian Loan and Bankers' Acceptance Credit
Extension in an amount equal to its Pro Rata Share of the
unpaid amount of such Canadian Loan or Bankers' Acceptance
Credit Extension together with accrued interest thereon (each,
a "Canadian Participation"), such Canadian Participation to be
governed by this Section 2.01(b)(ii)(A) and not by Section
11.07(d) hereof. Only upon demand from any Canadian Lender on
or after the date of (X) any Event of Default under Sections
8.01(a), 8.01(f) or 8.01(g) or (Y) an acceleration of the
maturity pursuant to Section 8.02(b) of any amounts owing to
the Canadian Lenders under this Agreement (the date of such
demand, the "Participation Funding Date"), each such Lender
that has purchased a Canadian Participation (each a "Canadian
Participant") shall deliver to the Canadian Administrative
Agent an amount equal to its Canadian Participation in same
day funds and in Canadian Dollars at the Canadian
Administrative Agent's Office for distribution to Canadian
Lenders in accordance with their Canadian Pro Rata Share. If
any amount required to be paid by any Canadian Participant
pursuant to this Section 2.01(b)(ii)(A) is not paid to the
Canadian Administrative Agent when due but is paid within
three Business Days after the date such payment is due, such
Canadian Participant shall pay to the Canadian Administrative
Agent for distribution to Canadian Lenders on demand an amount
equal to the product of (i) such amount, times (ii) the
Overnight Canadian Rate, times (iii) a fraction the numerator
of which is the number of days that elapse during such period
and the denominator of which is 365 or 366, as the case may
be. If such amount required to be paid by any Canadian
Participant pursuant to this Section 2.01(b)(ii)(A) is not in
fact made available to the Canadian Administrative Agent
within three Business Days after the date such payment is due,
the Canadian Administrative Agent shall be entitled to recover
from such Canadian Participant, on demand, such amount with
interest thereon calculated from such due date at the rate per
annum equal to the rate applicable thereto in accordance with
the preceding sentence plus the Applicable Rate. A certificate
of the Canadian Administrative Agent submitted to any Canadian
Participant with respect to any amounts owing under this
Section 2.01(b)(ii)(A) shall be conclusive in the absence of
manifest error. In the event the Canadian Administrative Agent
receives a payment with respect to any Canadian Loan in which
Canadian Participations have been purchased and as to which
the purchase price has been requested by the Canadian
Administrative Agent and delivered by a Canadian Participant
as in this Section 2.01(b)(ii)(A) provided, the Canadian
Administrative Agent shall promptly distribute to such
Canadian Participant its share of such payment based on its
Canadian Participation. If the Canadian Administrative Agent
pays any amount
23
to a Canadian Participant pursuant to this Section
2.01(b)(ii)(A) in the belief or expectation that a related
payment has been or will be received or collected and such
related payment is not received or collected by the Canadian
Administrative Agent, then such Canadian Participant will
promptly on demand by the Canadian Administrative Agent return
such amount to the Canadian Administrative Agent, together
with interest thereon at such rate as the Canadian
Administrative Agent shall determine to be customary between
banks for correction of errors. If the Canadian Administrative
Agent determines at any time that any amount received or
collected by the Canadian Administrative Agent pursuant to
this Agreement is to be returned to McKesson Canada under this
Agreement or paid to any other Person or entity pursuant to
any Debtor Relief Laws, any sharing clause in this Agreement,
or otherwise, then, notwithstanding any other provision of
this Agreement, the Canadian Administrative Agent shall not be
required to distribute any portion thereof to any Canadian
Participant, and each such Canadian Participant will promptly
on demand by the Canadian Administrative Agent repay any
portion that the Canadian Administrative Agent shall have
distributed to such Canadian Participant, together with
interest thereon at such rate, if any, as the Canadian
Administrative Agent shall pay to McKesson Canada or such
other Person or entity with respect thereto. If any amounts
returned to McKesson Canada or reimbursed by a Canadian
Participant pursuant to this Section 2.01(b)(ii)(A) are later
recovered by the Canadian Administrative Agent, the Canadian
Administrative Agent shall promptly pay to each Canadian
Participant a proportionate share based on such Canadian
Participant's Canadian Participation.
(B) Notwithstanding any other provision of this
Agreement, each Lender agrees that, prior to the Participation
Funding Date, all amounts paid or credited by McKesson Canada
under this Agreement to a Canadian Lender shall be received by
such Canadian Lender (a) for its own benefit and account or
(b) as agent for or for the account of an Eligible Assignee
that is a Canadian Resident in respect of the Canadian Loans,
and not otherwise as agent for or on behalf of any other
Person.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF COMMITTED LOANS.
(a) With respect to Domestic Loans, each Borrowing, each
conversion of Committed Loans from one Type to the other, and each continuation
of Eurodollar Rate Loans shall be made upon the Company's irrevocable notice to
the Administrative Agent, which may be given by telephone. Each such notice must
be received by the Administrative Agent not later than 9:00 a.m. (i) three
Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate
Loans to Base Rate Committed Loans, and (ii) on the requested date of any
Borrowing of Base Rate Committed Loans. With respect to Canadian Loans, each
Borrowing, each conversion of Canadian Loans from one Type to the other and each
continuation of Eurodollar Rate Loans shall be made upon McKesson Canada's
irrevocable notice to the Canadian Administrative Agent, which may be given by
telephone. Each such notice must be received by the Canadian Administrative
Agent not later than 11:00 a.m., Eastern time, (i) three Business Days prior to
the requested date of any Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or of any conversion of
24
Eurodollar Rate Loans to Canadian Prime Rate Loans, and (ii) one Business Day
prior to the requested date of any Borrowing of Canadian Prime Rate Loans. Each
telephonic notice by a Borrower pursuant to this Section 2.02(a) must be
confirmed promptly by delivery to the Applicable Agent of a written Committed
Loan Notice, appropriately completed and signed by a Responsible Officer of the
Applicable Borrower. Each Borrowing, conversion or continuation of Domestic
Loans shall be in a principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof and, in the case of Canadian Loans, in an aggregate
minimum amount of Cdn.$5,000,000 or any whole multiple of Cdn.$1,000,000 in
excess thereof. Except as provided in Section 2.03(c) and 2.04(g), each
Committed Loan Notice (whether telephonic or written) shall specify (i) whether
the Applicable Borrower is requesting a Borrowing, a conversion of Committed
Loans from one Type to the other, or a continuation of Eurodollar Rate Loans,
(ii) the identity of the Borrower and the requested date of the Borrowing,
conversion or continuation, as the case may be (which shall be a Business Day),
(iii) the principal amount of Committed Loans to be borrowed, converted or
continued, (iv) the Type of Committed Loans to be borrowed or to which existing
Committed Loans are to be converted, (v) if applicable, the duration of the
Interest Period with respect thereto and (vi) the Applicable Currency. If the
Applicable Borrower fails to specify a Type of Committed Loan in a Committed
Loan Notice or if the Applicable Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Committed Loans
shall be made as, or converted to, Base Rate Loans or Canadian Prime Rate Loans,
as appropriate. Any such automatic conversion to Base Rate Loans or Canadian
Prime Rate Loans shall be effective as of the last day of the Interest Period
then in effect with respect to the applicable Eurodollar Rate Loans. If the
Applicable Borrower requests a Borrowing of, conversion to, or continuation of
Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify an
Interest Period, they will be deemed to have specified an Interest Period of one
month.
(b) Following receipt of a Committed Loan Notice for Domestic
Loans, the Administrative Agent shall promptly notify each Lender of the amount
of its Pro Rata Share of the applicable Domestic Loans, and if no timely notice
of a conversion or continuation is provided by the Company, the Administrative
Agent shall notify each Lender of the details of any automatic conversion to
Base Rate Loans described in Section 2.02(a). Following receipt of a Committed
Loan Notice for Canadian Loans, the Canadian Administrative Agent shall promptly
notify each Canadian Lender of the amount of its Canadian Pro Rata Share of the
applicable Canadian Loans, and if no timely notice of a conversion or
continuation is provided by the Borrowers, the Canadian Administrative Agent
shall notify each Canadian Lender of the details of any automatic conversion to
Canadian Prime Rate Loans described in Section 2.02(a). In the case of a
Borrowing, each Lender shall make the amount of its Domestic Loan available to
the Administrative Agent in immediately available funds at the Administrative
Agent's Office not later than 11:00 a.m., and each Canadian Lender will make the
amount of its Canadian Loan available to the Canadian Administrative Agent in
Canadian Dollars at the Canadian Administrative Agent's Office by 11:00 a.m.,
Eastern time, on the Business Day specified in the applicable Committed Loan
Notice. Upon satisfaction of the applicable conditions set forth in Section 4.02
(and, if such Borrowing is the initial Credit Extension, Section 4.01), the
Applicable Agent shall make all funds so received available to the Applicable
Borrower in like funds as received by the Applicable Agent either by (i)
crediting the account of the Applicable Borrower on the books of Bank of America
or BA Canada with the amount of such funds or (ii) wire transfer of such funds,
in each case in accordance with instructions provided to (and reasonably
25
acceptable to) the Applicable Agent by the Applicable Borrower; provided,
however, that if, on the date the Committed Loan Notice with respect to such
Borrowing is given by a Borrower, there are unpaid amounts due in respect of
Bankers' Acceptances, in the case of McKesson Canada, or L/C Borrowings
outstanding, in the case of the Company, then the proceeds of such Borrowing
shall be applied, first, to the payment in full of any such L/C Borrowings, and
second, to the Applicable Borrower as provided above.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan
may be continued or converted only on the last day of an Interest Period for
such Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans without the
consent of the Required Lenders.
(d) The Administrative Agent shall promptly notify the Applicable
Borrower and the Lenders of the interest rate applicable to any Interest Period
for Eurodollar Rate Loans upon determination of such interest rate. The
determination of the Eurodollar Rate by the Administrative Agent shall be
conclusive in the absence of manifest error. At any time that Base Rate Loans
are outstanding, the Administrative Agent shall notify the Company and the
Lenders of any change in Bank of America's prime rate used in determining the
Base Rate promptly following the public announcement of such change. At any time
that Canadian Prime Rate Loans are outstanding, the Canadian Administrative
Agent shall notify McKesson Canada and the Canadian Lenders of any change in BA
Canada's prime lending rate used in determining the Canadian Prime Rate promptly
following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of
Committed Loans from one Type to the other, and all continuations of Committed
Loans as the same Type, there shall not be more than ten Interest Periods in
effect at any time with respect to Committed Loans.
(f) The Dollar Equivalent amount of any Borrowing in Canadian
Dollars will be determined by the Canadian Administrative Agent for such
Borrowing on the Computation Date therefor in accordance with Section 2.16(a)
and shall be conclusive absent manifest error.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein,
(A) the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the Letter
of Credit Expiration Date, to issue Letters of Credit for the account
of the Company or certain Subsidiaries, and to amend or renew Letters
of Credit previously issued by it, in accordance with Section 2.03(b),
and (2) to honor drafts under the Letters of Credit; and (B) the
Lenders severally agree to participate in Letters of Credit issued for
the account of the Company; provided that the L/C Issuer shall not be
obligated to make any L/C Credit Extension with respect to any Letter
of Credit, and no Lender shall be obligated to participate in any
Letter of Credit if as of the date of such L/C Credit Extension, (x)
the Total Outstandings would exceed the Aggregate Commitments, (y) the
aggregate Outstanding Amount of the Committed Loans of any Lender, plus
such
26
Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations, would exceed such Lender's Commitment, or (z) the
Outstanding Amount of the L/C Obligations would exceed the Letter of
Credit Sublimit. Within the foregoing limits, and subject to the terms
and conditions hereof, the Company's ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Company may,
during the foregoing period, obtain Letters of Credit to replace
Letters of Credit that have expired or that have been drawn upon and
reimbursed.
(ii) The L/C Issuer shall be under no obligation to issue
any Letter of Credit if:
(A) any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms
purport to enjoin or restrain the L/C Issuer from issuing such
Letter of Credit, or any Law applicable to the L/C Issuer or
any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over
the L/C Issuer shall prohibit, or request that the L/C Issuer
refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon the
L/C Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the L/C
Issuer is not otherwise compensated hereunder) not in effect
on the Closing Date, or shall impose upon the L/C Issuer any
unreimbursed loss, cost or expense which was not applicable on
the Closing Date and which the L/C Issuer in good ▇▇▇▇▇ ▇▇▇▇▇
material to it;
(B) subject to Section 2.03(b)(iii), the expiry
date of such requested Letter of Credit would occur more than
twelve months after the date of issuance or last renewal,
unless the Required Lenders have approved such expiry date;
(C) the expiry date of such requested Letter of
Credit would occur after the Letter of Credit Expiration Date,
unless all the Lenders have approved such expiry date; or
(D) such Letter of Credit is in an initial
amount less than $100,000, in the case of a commercial Letter
of Credit, or $500,000, in the case of a standby Letter of
Credit, or is to be denominated in a currency other than
Dollars; provided that the $500,000 minimum amount relating to
a standby Letter of Credit shall not be applicable if the
Company pays to the L/C Issuer in respect of such Letter of
Credit an additional issuance fee in an amount to be agreed
between the Company and the L/C Issuer from time to time.
(iii) The L/C Issuer shall be under no obligation to amend
any Letter of Credit if (A) the L/C Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the
terms hereof, or (B) the Beneficiary of such Letter of Credit does not
accept the proposed amendment to such Letter of Credit.
(iv) On and after the Closing Date, the Existing Letters
of Credit shall be deemed for all purposes, including for purposes of
the fees and charges to be collected pursuant to this Section 2.03 for
periods on and after the Closing Date, and
27
reimbursement of costs and expenses to the extent provided herein, to
be Letters of Credit outstanding under this Agreement and entitled to
the benefits of this Agreement and the other Loan Documents, and shall
be governed by the applications and agreements pertaining thereto and
by this Agreement; provided, however, that, notwithstanding any other
provision of this Agreement, no fees with respect to the initial
issuance of the Existing Letters of Credit shall be due hereunder.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Renewal Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as
the case may be, upon the request of the Company delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a
Letter of Credit Application, appropriately completed and signed by a
Responsible Officer of the Company. Such Letter of Credit Application
must be received by the L/C Issuer and the Administrative Agent not
later than 9:00 a.m. at least three Business Days (or such later date
and time as the L/C Issuer may agree in a particular instance in its
sole discretion) prior to the proposed issuance date or date of
amendment, as the case may be. In the case of a request for an initial
issuance of a Letter of Credit, such Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer: (A) the
proposed issuance date of the requested Letter of Credit (which shall
be a Business Day); (B) the amount thereof; (C) the expiry date
thereof; (D) the name and address of the beneficiary thereof; (E) the
documents to be presented by the Beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by the
Beneficiary in case of any drawing thereunder; and (G) such other
matters as the L/C Issuer may require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C
Issuer (A) the Letter of Credit to be amended; (B) the proposed date of
amendment thereof (which shall be a Business Day); (C) the nature of
the proposed amendment; and (D) such other matters as the L/C Issuer
may require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received
a copy of such Letter of Credit Application from the Company and, if
not, the L/C Issuer will provide the Administrative Agent with a copy
thereof. Upon receipt by the L/C Issuer of confirmation from the
Administrative Agent that the requested issuance or amendment is
permitted in accordance with the terms hereof, then, subject to the
terms and conditions hereof, the L/C Issuer shall, on the requested
date, issue a Letter of Credit for the account of the Company or enter
into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a risk participation in such
Letter of Credit in an amount equal to the product of such Lender's Pro
Rata Share times the amount of such Letter of Credit.
(iii) If the Company so requests in any applicable Letter
of Credit Application, the L/C Issuer shall issue a Letter of Credit
that has automatic renewal provisions (each,
28
an "Auto-Renewal Letter of Credit"); provided that any such
Auto-Renewal Letter of Credit must permit the L/C Issuer to prevent any
such renewal at least once in each twelve-month period (commencing with
the date of issuance of such Letter of Credit) by giving prior notice
to the beneficiary thereof not later than a day (the "Nonrenewal Notice
Date") in each such twelve-month period to be agreed upon at the time
such Letter of Credit is issued; provided further that the L/C Issuer
shall not exercise its right to prevent any such renewal unless the L/C
Issuer determines that it would have no obligation at such time to
issue such Letter of Credit in its renewed form under the terms of this
Agreement. Unless otherwise directed by the L/C Issuer, the Company
shall not be required to make a specific request to the L/C Issuer for
any such renewal. Once an Auto-Renewal Letter of Credit has been
issued, the Lenders shall be deemed to have authorized (but may not
require) the L/C Issuer to permit the renewal of such Letter of Credit
at any time to an expiry date not later than the Letter of Credit
Expiration Date; provided, however, that the L/C Issuer shall not
permit any such renewal if (A) the L/C Issuer has determined that it
would have no obligation at such time to issue such Letter of Credit in
its renewed form under the terms of this Agreement (by reason of the
provisions of Section 2.03(a)(ii) or otherwise), or (B) it has received
notice (which may be by telephone or in writing) on or before the day
that is five Business Days before the Nonrenewal Notice Date from the
Administrative Agent, any Lender or the Company that one or more of the
applicable conditions specified in Section 4.02 is not then satisfied.
(iv) Promptly after its delivery of any Letter of Credit
or any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to the Company and the Administrative Agent a true and complete copy of
such Letter of Credit or amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the Beneficiary of any Letter of
Credit of any notice of a drawing under such Letter of Credit, the L/C
Issuer shall notify the Company and the Administrative Agent thereof.
Not later than 11:00 a.m. on the date of any payment by the L/C Issuer
under a Letter of Credit (each such date, an "Honor Date"), the Company
shall reimburse the L/C Issuer through the Administrative Agent in an
amount equal to the amount of such drawing. If the Company fails to so
reimburse the L/C Issuer by such time, the Administrative Agent shall
promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the "Unreimbursed Amount"), and the amount of
such Lender's Pro Rata Share thereof. In such event, the Company shall
be deemed to have requested a Borrowing of Base Rate Loans to be
disbursed on the Honor Date in an amount equal to the Unreimbursed
Amount, without regard to the minimum and multiples specified in
Section 2.02 for the principal amount of Base Rate Loans, but subject
to the amount of the unutilized portion of the Aggregate Commitments
and the conditions set forth in Section 4.02 (other than the delivery
of a Committed Loan Notice). Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be given
by telephone if immediately confirmed in writing; provided that the
lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
29
(ii) Each Lender (including the Lender acting as L/C
Issuer) shall upon any notice pursuant to Section 2.03(c)(i) make funds
available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent's Office in an amount equal to its Pro Rata
Share of the Unreimbursed Amount not later than 1:00 p.m. on the
Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii), each
Lender that so makes funds available shall be deemed to have made a
Base Rate Committed Loan to the Company in such amount. The
Administrative Agent shall remit the funds so received to the L/C
Issuer.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Borrowing of Base Rate Loans because the
conditions set forth in Section 4.02 cannot be satisfied or for any
other reason, the Company shall be deemed to have incurred from the L/C
Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that
is not so refinanced, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at the Default
Rate. In such event, each Lender's payment to the Administrative Agent
for the account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall
be deemed payment in respect of its participation in such L/C Borrowing
and shall constitute an L/C Advance from such Lender in satisfaction of
its participation obligation under this Section 2.03.
(iv) Until each Lender funds its Committed Loan or L/C
Advance pursuant to this Section 2.03(c) to reimburse the L/C Issuer
for any amount drawn under any Letter of Credit, interest in respect of
such Lender's Pro Rata Share of such amount shall be solely for the
account of the L/C Issuer.
(v) Each Lender's obligation to make Committed Loans or
L/C Advances to reimburse the L/C Issuer for amounts drawn under
Letters of Credit, as contemplated by this Section 2.03(c), shall be
absolute and unconditional and shall not be affected by any
circumstance, including (A) any set-off, counterclaim, recoupment,
defense or other right which such Lender may have against the L/C
Issuer, the Company or any other Person for any reason whatsoever; (B)
the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender's obligation to make
Committed Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 4.02 (other than delivery by the
Company of a Committed Loan Notice). No such making of an L/C Advance
shall relieve or otherwise impair the obligation of the Company to
reimburse the L/C Issuer for the amount of any payment made by the L/C
Issuer under any Letter of Credit, together with interest as provided
herein.
(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer
at a rate per annum equal to the Federal Funds Rate from time to time
in effect. A certificate of the L/C Issuer submitted to any Lender
(through the
30
Administrative Agent) with respect to any amounts owing under this
clause (vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such
Lender's L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the Administrative Agent receives for the account
of the L/C Issuer any payment in respect of the related Unreimbursed
Amount or interest thereon (whether directly from the Company or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Pro Rata Share thereof (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which such
Lender's L/C Advance was outstanding) in the same funds as those
received by the Administrative Agent.
(ii) If any payment received by the Administrative Agent
for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in
Section 11.06 (including pursuant to any settlement entered into by the
L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Pro Rata
Share thereof on demand of the Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is
returned by such Lender, at a rate per annum equal to the Federal Funds
Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Company to
reimburse the L/C Issuer for each drawing under each Letter of Credit and to
repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, or any other agreement or instrument
relating thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Company may have at any time against
any Beneficiary of such Letter of Credit (or any Person for whom any
such Beneficiary may be acting), the L/C Issuer or any other Person,
whether in connection with this Agreement, the transactions
contemplated hereby or by such Letter of Credit or any agreement or
instrument relating thereto, or any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such
31
Letter of Credit; or any payment made by the L/C Issuer under such
Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of any
Beneficiary or of such Letter of Credit, including any arising in
connection with any proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or
a discharge of, the Company.
The Company shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Company's instructions or other irregularity, the Company
will immediately notify the L/C Issuer. The Company shall be conclusively deemed
to have waived any such claim against the L/C Issuer and its correspondents
unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Company agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
any Agent-Related Person nor any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Company hereby assumes all risks of the acts or omissions of any Beneficiary
with respect to its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Company's pursuing
such rights and remedies as it may have against the Beneficiary at law or under
any other agreement. None of the L/C Issuer, any Agent-Related Person, nor any
of the respective correspondents, participants or assignees of the L/C Issuer,
shall be liable or responsible for any of the matters described in clauses (i)
through (v) of Section 2.03(e); provided, however, that anything in such clauses
to the contrary notwithstanding, the Company may have a claim against the L/C
Issuer, and the L/C Issuer may be liable to the Company, to the extent, but only
to the extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Company which the Company proves were caused by the L/C Issuer's
willful misconduct or gross negligence or the L/C Issuer's willful failure to
pay under any Letter of Credit after the presentation to it of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
32
(g) Cash Collateral. Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,
as of the Letter of Credit Expiration Date, any Letter of Credit may for any
reason remain outstanding and partially or wholly undrawn, the Company shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount determined as of the
date of such L/C Borrowing or the Letter of Credit Expiration Date, as the case
may be). For purposes hereof, "Cash Collateralize" means to pledge and deposit
with or deliver to the Administrative Agent, for the benefit of the L/C Issuer
and the Lenders, as collateral for the L/C Obligations, cash or deposit account
balances pursuant to documentation in form and substance satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term have corresponding meanings. The
Company hereby grants to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing. Cash collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America.
(h) Applicability of ISP 98 and UCP. Unless otherwise expressly
agreed by the L/C Issuer and the Company when a Letter of Credit is issued, (i)
the rules of the "International Standby Practices (ISP 98)" published by the
Institute of International Banking Law & Practice, Inc. (or such later version
thereof as may be in effect at the time of issuance), with the exception of Rule
5.09 thereof, shall apply to each standby Letter of Credit, and (ii) the rules
of the Uniform Customs and Practice for Documentary Credits, as most recently
published by the International Chamber of Commerce (the "ICC") at the time of
issuance (including the ICC decision published by the Commission on Banking
Technique and Practice on April 6, 1998 regarding the European single currency
(euro)) shall apply to each commercial Letter of Credit.
(i) Letter of Credit Fees. The Company shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share a letter of credit fee for each Letter of Credit equal to the
Applicable Rate times the daily maximum amount available to be drawn under such
Letter of Credit (whether or not such maximum amount is then in effect under
such Letter of Credit). Such letter of credit fees shall be computed on a
quarterly basis in arrears. Such letter of credit fees shall be due and payable
on the fifth Business Day following the end of each calendar quarter, commencing
with the first such date to occur after the issuance of such Letter of Credit,
on the Letter of Credit Expiration Date and thereafter on demand. If there is
any change in the Applicable Rate during any quarter, the daily maximum amount
of each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect.
(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. The Company shall pay directly to the L/C Issuer for its own account
a fronting fee with respect to each Letter of Credit in an amount equal to .125%
per annum times the daily maximum amount available to be drawn under such Letter
of Credit. Such fronting fees shall be computed on a quarterly basis in arrears.
Such fronting fees shall be due and payable on the first Business Day after the
end of each calendar quarter, commencing with the first such date to occur after
the issuance of such Letter of Credit, on the Letter of Credit Expiration Date
and thereafter on demand. In addition, the Company shall pay directly to the L/C
Issuer for its own account the
33
customary issuance, presentation, amendment and other processing fees, and other
standard costs and charges, of the L/C Issuer relating to letters of credit as
from time to time in effect. Such customary fees and standard costs and charges
are due and payable on demand and are nonrefundable.
(k) Conflict with Letter of Credit Application. In the event of
any conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
(l) Reports to Administrative Agent. The L/C Issuer shall deliver
to the Administrative Agent, upon each calendar month end, a report setting
forth for such period the daily aggregate amount available to be drawn under the
Letters of Credit that were outstanding during such month.
2.04 BANKERS' ACCEPTANCES FOR MCKESSON CANADA.
(a) Acceptance Commitment.
(i) Each Canadian Lender severally agrees, on and subject
to the terms and conditions set forth herein: (A) in the case of a
Canadian Lender that is able to accept Drafts from McKesson Canada, to
create acceptances (each, a "Bankers' Acceptance") by accepting Drafts
from McKesson Canada and to purchase such Bankers' Acceptances in
accordance with Section 2.04(d); and (B) in the case of a Canadian
Lender that has participated all or any part of its interest in the
Bankers' Acceptance Facilities to a participant that is able to accept
Drafts from McKesson Canada, to arrange for the creation of Bankers'
Acceptances by such participant and for the purchase of such Bankers'
Acceptances by such participant, to the extent of such participation or
assignment, in accordance with Section 2.04(d).
(ii) Each Drawing shall be in an aggregate Face Amount of
not less than Cdn.$5,000,000 and in integral multiples of
Cdn.$1,000,000 and shall consist of the creation and purchase of
Bankers' Acceptances on the same day, effected or arranged by the
Canadian Lenders in accordance with Section 2.04(d), ratably according
to their respective Canadian Pro Rata Shares.
(iii) Anything contained in this Agreement to the contrary
notwithstanding, the Bankers' Acceptance Facility and the Canadian
Commitments shall be subject to the following limitations:
(A) the amount otherwise available for Drawing
under the Aggregate Canadian Commitment as of any time of
determination shall be reduced by an amount equal to the Total
Canadian Outstandings as of such time of determination;
(B) after any Drawing the Total Outstandings
shall not exceed the Aggregate Commitments then in effect; and
(C) after any Drawing the Total Canadian
Outstandings shall not exceed the Aggregate Canadian
Commitments then in effect.
34
(b) Drawing Notice.
(i) Each Drawing shall be made on three Business Days'
prior written notice specified in relation to Bankers' Acceptances,
given not later than 11:00 a.m. (Toronto time), by McKesson Canada to
the Canadian Administrative Agent. Each such notice of a Drawing (a
"Drawing Notice") shall be given in substantially the form of Exhibit F
annexed hereto or by telephone confirmed promptly in writing,
containing the same information as would be contained in a Drawing
Notice, and shall specify therein (A) the Drawing Date; (B) the
aggregate Face Amount of Drafts to be accepted; and (C) the maturity
date for such Drafts. The Canadian Administrative Agent shall give each
Canadian Lender prompt notice of such Drawing Notice and of such
Canadian Lender's ratable portion of Drafts to be accepted under the
Drawing.
(ii) McKesson Canada shall not request in a Drawing Notice
a maturity date for Drafts that would be subsequent to the Maturity
Date.
(iii) Each Drawing Notice shall be irrevocable and binding
on McKesson Canada. McKesson Canada shall indemnify each Canadian
Lender against any loss or expense incurred by such Canadian Lender as
a result of any failure by McKesson Canada to fulfill or honor before
the date specified for any Drawing, the applicable conditions set forth
in this Section 2.04 or Section 4.02, if the Drawing, as a result of
such failure, is not made on such date.
(iv) McKesson Canada shall repay, and there shall become
due and payable, on the Drawing Date the principal amount of any
Canadian Loans which McKesson Canada seeks to convert, if any, in whole
or in part, to Bankers' Acceptances on such Drawing Date.
(v) None of the Canadian Administrative Agent, the
Administrative Agent or the Canadian Lenders shall incur any liability
to McKesson Canada or the Company in acting on the telephonic notice
referred to above which the Canadian Administrative Agent, the
Administrative Agent or any Canadian Lenders believes in good faith to
have been given by a duly authorized officer or other person authorized
to borrow on behalf of McKesson Canada or for otherwise acting in good
faith under this Section 2.04 and upon the acceptance of Drafts
pursuant to any such telephonic notice, McKesson Canada shall be liable
with respect thereto as provided herein. In the event of a conflict
between the Canadian Administrative Agent's record of the applicable
terms of any Drawing and such Drawing Notice, the Canadian
Administrative Agent's record shall prevail, absent manifest or
demonstrable error.
(c) Form of Bankers' Acceptances.
(i) Each Draft presented by McKesson Canada shall (A) be
dated the date of the Drawing; (B) mature and be payable by McKesson
Canada (in common with all other Drafts presented in connection with
such Drawing) on a Business Day which occurs no less than 30 days nor
more than 180 days after the date thereof, which term shall be
specified on the Drawing Notice presented by McKesson Canada in
accordance with
35
Section 2.04(b)(1); (C) be in a form reasonably acceptable to the
Canadian Administrative Agent; and (D) if such Draft is drawn on a
Canadian Lender that is a Member, be payable to the Clearing House.
(ii) McKesson Canada hereby renounces, and shall not
claim, any days of grace for the payment of any Bankers' Acceptances.
(d) Acceptance and Purchase of Drafts.
(i) Not later than 11:00 a.m. (Toronto time) on an
applicable Drawing Date, each Canadian Lender shall, as the case may
be, (A) complete one or more Drafts dated the date of such Drawing,
with the maturity date specified by McKesson Canada in the Drawing
Notice, accept such Drafts, and purchase the Bankers' Acceptances
thereby created for the Drawing Purchase Price; and (B) arrange for its
participant to complete one or more Drafts dated the date of such
Drawing, with the maturity date specified by McKesson Canada in the
Drawing Notice, to accept such Drafts and to purchase the Bankers'
Acceptances thereby created for the Drawing Purchase Price.
(ii) The failure of any Canadian Lender to accept Drafts
or purchase Bankers' Acceptances as part of any Drawing shall not
relieve such Canadian Lender of its obligation, if any, to accept
Drafts and purchase Bankers' Acceptances hereunder, but a Canadian
Lender shall not be responsible for the failure of any other Canadian
Lender to accept Drafts or purchase Bankers' Acceptance on the Drawing
Date for any Drawing.
(iii) The parties hereto agree that in the administering of
Bankers' Acceptances, each Canadian Lender may avail itself of the debt
clearing services offered by the Clearing House and that the procedures
set forth in Section 2.04 be deemed amended to the extent necessary to
comply with the requirements of such debt clearing services. The
foregoing sentence applies only to the administration of Bankers'
Acceptances by the Canadian Lenders and shall not affect the rights and
obligations of McKesson Canada with respect to any Bankers' Acceptance.
(e) Payment of Drawing Purchase Price.
(i) Subject to Section 2.04(b)(iv), each Canadian Lender
shall, before 12:00 noon (Toronto time) on the applicable Drawing Date,
pay or cause to be paid, the Drawing Purchase Price in respect of any
Bankers' Acceptances which such Canadian Lender has purchased or
arranged to have purchased pursuant to Section 2.04(d)(i) by depositing
or causing to be deposited such amount to such account maintained by
the Canadian Administrative Agent at BA Canada as shall have been
notified to such Canadian Lender by the Canadian Administrative Agent,
in Canadian Dollars in same day funds. Promptly upon receipt of such
funds, the Canadian Administrative Agent shall make such funds
available to McKesson Canada in accordance with reasonable instructions
provided to the Canadian Administrative Agent by McKesson Canada.
(ii) Bankers' Acceptances purchased by a Canadian Lender
or its participant hereunder may be held by such Canadian Lender or
such participant, as the case may be,
36
for its own account until maturity or sold by it at any time prior
thereto in any relevant market therefor in Canada, in such Lender's or
its participant's sole discretion.
(f) Effective Discount Rate Determination. Promptly upon request
of McKesson Canada, the Canadian Administrative Agent shall provide McKesson
Canada an indicative Effective Discount Rate, which rate shall not be binding on
the Canadian Administrative Agent, the Administrative Agent or the Lenders for
purposes of any Drawing or acceptance of Drafts.
(g) Payment at Maturity; Cash Collateral.
(i) McKesson Canada shall pay to the Canadian
Administrative Agent, and there shall become due and payable, at 12:00
noon (Toronto time) on the maturity date for each Bankers' Acceptance
an amount in Canadian Dollars in same day funds equal to the Face
Amount of such Bankers' Acceptance. McKesson Canada shall make each
payment hereunder in respect of Bankers' Acceptances by deposit of the
required funds to the Canadian Administrative Agent at the Canada
Administrative Agent's Office. Upon receipt of such payment, the
Canadian Administrative Agent will promptly thereafter cause such
payment to be distributed in like funds in payment of Bankers'
Acceptances ratably (based on the proportion that the aggregate Face
Amount of Bankers' Acceptances held by any Canadian Lender or any
participant thereof maturing on the relevant date bears to the
aggregate Face Amount of Bankers' Acceptances accepted or held by all
Canadian Lenders or any participants or assignees thereof maturing on
such date) to Canadian Lenders for their account and for the account of
any participant, to the extent of and in accordance with their
participation. Such payment to the Canadian Administrative Agent shall
satisfy McKesson Canada's obligations under any Bankers' Acceptances to
which it relates and each Canadian Lender that has accepted such
Bankers' Acceptances shall thereafter be solely responsible for the
payment of such Bankers' Acceptances and shall indemnify and hold
McKesson Canada harmless against any liabilities, costs or expenses
incurred by McKesson Canada as a result of any failure by such Canadian
Lender or such participant to pay such Bankers' Acceptance in
accordance with its terms.
(ii) If McKesson Canada fails to pay any Bankers'
Acceptance when due, or to convert or renew the Face Amount of such
Bankers' Acceptance pursuant to Section 2.04(i), the unpaid amount due
and payable in respect thereof shall be converted as of such date, and
without any necessity for McKesson Canada to give a Committed Loan
Notice in accordance with Section 2.02, to, and thereafter be
outstanding as, a Canadian Prime Rate Loan made by, the Canadian
Lenders and shall bear interest calculated and payable as provided in
Section 2.08. Each Borrower acknowledges, agrees and confirms with the
Canadian Lenders that the records of each Canadian Lender in respect of
payment of any Bankers' Acceptance by such Canadian Lender shall be
binding on McKesson Canada and shall be conclusive evidence (in the
absence of manifest error) of a Canadian Prime Rate Loan to an amount
owing by McKesson Canada to such Canadian Lender. McKesson Canada
further agrees that if an Event of Default or the Maturity Date shall
occur prior to the date upon which any one or more Bankers' Acceptances
are payable by a Canadian Lender, thereupon, McKesson Canada shall
provide such Canadian Lender with funds for the full Face Amounts of
all such
Bankers' Acceptances, notwithstanding the fact that any such Bankers'
Acceptance may be held by such Canadian Lender in its own right at
maturity; provided, however, that if for any reason McKesson Canada
fails to make such payment in respect of any Bankers' Acceptance,
thereupon McKesson Canada shall be deemed for all purposes to have
received a Canadian Prime Rate Loan in an amount equal to the face
amount of such Bankers' Acceptance and McKesson Canada shall pay
interest thereon at the Canadian Prime Rate until repayment thereof in
full.
(h) Presigned Draft Forms.
(i) To enable the Canadian Lenders to create Bankers'
Acceptances or complete Drafts in the manner specified in this Section
2.04, McKesson Canada shall supply each Canadian Lender with such
number of Drafts as such Canadian Lender may reasonably request, duly
endorsed and executed on behalf of McKesson Canada by any one or more
of its authorized officers. Each Canadian Lender shall exercise such
care in the custody and safekeeping of Drafts as it would exercise in
the custody and safekeeping of similar property owned by it. Each
Canadian Lender will, upon request by McKesson Canada, promptly advise
McKesson Canada of the number and designations, if any, of the
uncompleted Drafts then held by it. The signatures of such officers may
be mechanically reproduced in facsimile and Drafts and Bankers'
Acceptances bearing such facsimile signatures shall be binding upon
McKesson Canada as if they had been manually signed by such officers.
Notwithstanding that any of the individuals whose manual or facsimile
signature appears on any Draft or Bankers' Acceptance as one of such
officers may no longer hold office at the date thereof or at the date
of its acceptance by a Canadian Lender or a participant hereunder or at
any time thereafter, any Draft or Bankers' Acceptance so signed shall
be valid and binding upon McKesson Canada.
(ii) To facilitate the acceptance of Drafts hereunder,
McKesson Canada hereby appoints each Canadian Lender as its attorney to
sign and endorse on its behalf, as and when considered necessary by
such Canadian Lender in connection with a Drawing, an appropriate
number of Drafts in the form prescribed by that Canadian Lender. Any
Draft signed by a Canadian Lender as attorney for McKesson Canada,
whether signed in handwriting or by the facsimile or mechanical
signature of an authorized officer of a Canadian Lender, may be dealt
with by the Canadian Administrative Agent or any Canadian Lender to all
intents and purposes and shall bind McKesson Canada as if duly signed
and issued by McKesson Canada.
(i) Conversion or Renewal of Bankers' Acceptances. Upon the
maturity of a Bankers' Acceptance, McKesson Canada may elect to (A) renew such
Bankers' Acceptance, by giving a Drawing Notice in accordance with Section
2.04(b)(i); or (B) have all or a portion of the Face Amount of such Bankers'
Acceptance converted to a Eurodollar Rate Loan or Canadian Prime Rate Loan, by
giving a Committed Loan Notice in accordance with Section 2.02. If the Bankers'
Acceptances to be converted cannot be converted into a Eurodollar Rate Loan or
Canadian Prime Rate Loan in an aggregate amount which may be made as a
Eurodollar Rate Loan or Canadian Prime Rate Loan, as the case may be, under this
Agreement, then the amount which cannot be so converted shall be repaid to the
Canadian Administrative Agent for
38
distribution to the Canadian Lenders in accordance with Section 2.04(g) on the
date of such conversion.
(j) Circumstances Making Bankers' Acceptances Unavailable.
(i) If the Canadian Administrative Agent determines in
good faith, which determination shall be final, conclusive and binding
upon McKesson Canada, and notifies McKesson Canada that, by reason of
circumstances affecting the money market (A) there is no market for
Bankers' Acceptances; or (B) the demand for Bankers' Acceptances is
insufficient to allow the sale or trading of the Bankers' Acceptances
created and purchased hereunder; then,
(1) the right of McKesson Canada to request a
Drawing shall be suspended until the Canadian Administrative
Agent determines that the circumstances causing such
suspension no longer exist and the Canadian Administrative
Agent so notifies McKesson Canada; and
(2) any Drawing Notice which is outstanding
shall be cancelled and the Drawing requested therein shall not
be made.
(ii) The Canadian Administrative Agent shall promptly
notify McKesson Canada and the Administrative Agent of the suspension
of McKesson Canada's right to request a Drawing and of the termination
of any such suspension.
(k) Prepayments. Except as required by Article VIII, Section 2.05
or Section 2.07, no repayment of a Bankers' Acceptance shall be made by McKesson
Canada to a Canadian Lender prior to the maturity date thereof. Any such
repayment, made as required by Article VIII, Section 2.05 or Section 2.07, shall
be made (unless such repayment has been rescinded or otherwise is required to be
returned by such Canadian Lender to McKesson Canada for any reason) in
accordance with the provisions of Section 2.04(g)(i). Any such payment by
McKesson Canada to the Canadian Administrative Agent shall satisfy McKesson
Canada's obligations under the Bankers' Acceptance to which it relates and, in
the case of a Bankers' Acceptance which has been accepted by a Canadian Lender
or its participant, such Canadian Lender or such participant shall thereafter be
solely responsible for the payment of such Bankers' Acceptance and shall
indemnify and hold McKesson Canada harmless against any liabilities, costs or
expenses incurred by McKesson Canada as a result of any failure by such Canadian
Lender or such participant to pay such Bankers' Acceptance in accordance with
its terms.
2.05 PREPAYMENTS.
(a) The Applicable Borrower may, upon notice to the Applicable
Agent, at any time or from time to time voluntarily prepay Domestic Loans or
Canadian Loans, as the case may be, in whole or in part without premium or
penalty; provided that (i) such notice must be received by the Applicable Agent
not later than 9:00 a.m., in the case of a prepayment of Domestic Loans, and
11:00 a.m., Eastern time, in the case of prepayment of Canadian Loans, (A) three
Business Days prior to any date of prepayment of Eurodollar Rate Loans and (B)
on the date of prepayment of Base Rate Committed Loans and Canadian Prime Rate
Loans; (ii) any prepayment of Domestic Loans shall be in a principal amount of
$5,000,000 or a whole multiple
39
of $1,000,000 in excess thereof; and (iii) any prepayment of Canadian Loans
shall be in a principal amount of Cdn.$5,000,000 or a whole multiple of Cdn
$1,000,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding. Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Committed Loans to be prepaid. The
Applicable Agent will promptly notify each Lender or Canadian Lender, as
appropriate, of its receipt of each such notice, and of the amount of such
Lender's Pro Rata Share or Canadian Pro Rata Share, as appropriate, of such
prepayment. If such notice is given by a Borrower, the Applicable Borrower
shall make such prepayment and the payment amount specified in such notice
shall be due and payable on the date specified therein. Any prepayment of a
Eurodollar Rate Loan shall be accompanied by all accrued interest thereon,
together with any additional amounts required pursuant to Section 3.05. Each
such prepayment shall be applied to the Committed Loans of the Lenders in
accordance with their respective Pro Rata Shares or Canadian Pro Rata Shares,
as appropriate.
(b) Subject to Section 2.14, if for any reason the Total
Outstandings at any time exceed the Aggregate Commitments then in effect, the
Company shall immediately prepay Loans and/or Cash Collateralize the L/C
Obligations and/or McKesson Canada shall immediately prepay Canadian Loans
and/or cash collateralize Bankers' Acceptances in an aggregate amount equal to
such excess; provided, however, that the Borrowers shall not be required to Cash
Collateralize the L/C Obligations or prepay the Face Amounts of Bankers'
Acceptances pursuant to this Section 2.05(b) unless after the prepayment in full
of the Committed Loans the Total Outstandings exceed the Aggregate Commitments
then in effect.
(c) Subject to Section 2.14, if for any reason the Total Canadian
Outstandings at any time exceed the Aggregate Canadian Commitments then in
effect, McKesson Canada shall immediately prepay Canadian Loans and cash
collateralize Bankers' Acceptances in an aggregate amount equal to such excess,
provided that McKesson Canada shall not be required to prepay the Bankers'
Acceptances pursuant to this Section 2.05(c) unless, after prepayment in full of
the Canadian Loans, the Total Canadian Outstandings exceed the Aggregate
Canadian Commitments then in effect.
2.06 TERMINATION OR REDUCTION OF COMMITMENTS. The Company may, upon
notice to the Applicable Agent, terminate the Aggregate Commitments or the
Aggregate Canadian Commitments, or from time to time permanently reduce the
Aggregate Commitments or the Aggregate Canadian Commitments; provided that (i)
any such notice shall be received by the Applicable Agent not later than 9:00
a.m. or, in the case of a reduction of the Canadian Commitments, 11:00 a.m.,
Eastern time, five Business Days prior to the date of termination or reduction,
(ii) any such partial reduction shall be in an aggregate amount of $10,000,000
or any whole multiple of $1,000,000 in excess thereof, (iii) the Company shall
not terminate or reduce the Aggregate Commitments if, after giving effect
thereto and to any concurrent prepayments hereunder, the Total Outstandings
would exceed the Aggregate Commitments, (iv) the Company shall not terminate or
reduce the Aggregate Canadian Commitments if, after giving effect thereto and to
any concurrent prepayments hereunder, the Total Canadian Outstandings would
exceed the Aggregate Canadian Commitments, (v) if, after giving effect to any
reduction of the Aggregate Commitments, the Letter of Credit Sublimit exceeds
the amount of the Aggregate Commitments, such Sublimit shall be automatically
reduced by the amount of such excess, and (vi) if, after giving effect to any
reduction of the Aggregate Commitments, the Aggregate
40
Canadian Commitments exceed the amount of the Aggregate Commitments, the
Aggregate Canadian Commitments shall be automatically reduced by the amount of
such excess. The Administrative Agent will promptly notify the Lenders of any
such notice of termination or reduction of the Aggregate Commitments and the
Canadian Administrative Agent will promptly notify the Canadian Lenders of any
such notice of termination or reduction of the Aggregate Canadian Commitments.
Any reduction of the Aggregate Commitments or Aggregate Canadian Commitments
shall be applied to the Commitment of each Lender or the Canadian Commitment of
each Canadian Lender, as the case may be, according to its Pro Rata Share or
its Canadian Pro Rata Share, as the case may be. All facility and utilization
fees accrued until the effective date of any termination of the Aggregate
Commitments shall be paid on the effective date of such termination.
2.07 REPAYMENT OF LOANS.
The Applicable Borrower shall repay to the Lenders on the Maturity Date
the aggregate principal amount of its Committed Loans outstanding on such date.
McKesson Canada shall repay to the Lenders on the date that it ceases to be a
Wholly-Owned Subsidiary of the Company the aggregate principal amount of its
Canadian Loans outstanding on such date.
2.08 INTEREST.
(a) Subject to the provisions of Section 2.08(b), (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate
Committed Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate
plus the Applicable Rate; and (iii) each Canadian Prime Rate Loan shall bear
interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Canadian Prime Rate plus the
Applicable Rate.
(b) If any amount payable by a Borrower under any Loan Document is
not paid when due (without regard to any applicable grace periods), whether at
stated maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. Furthermore,
upon the request of the Required Lenders, while any Event of Default exists, the
Borrowers shall pay interest on the principal amount of all outstanding
Obligations hereunder at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
Accrued and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
41
2.09 FEES. In addition to certain fees described in Sections
2.03(i) and (j) and Section 2.04:
(a) Facility Fee. The Company shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share, a
facility fee on the later of the fifth Business Day following the end of each
calendar quarter or the fifth Business Day after the Company has received from
the Administrative Agent a notice setting forth the amount of such fee, which
shall be equal to the Applicable Rate times the actual daily amount of the
Aggregate Commitments (or, if the Aggregate Commitments have terminated, on the
Outstanding Amount of all Committed Loans, Bankers' Acceptances and L/C
Obligations), regardless of usage. The facility fee shall accrue at all times
during the Availability Period (and thereafter so long as any Committed Loans,
Bankers' Acceptances or L/C Obligations remain outstanding), including at any
time during which one or more of the conditions in Article IV are not met, and
shall be due and payable quarterly in arrears on each date specified above
following the end of each calendar quarter, commencing with the first such date
to occur after the Closing Date, through the end of the Availability Period
(and, if applicable, thereafter on demand). The facility fee shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.
(b) Utilization Fee. The Company shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share, a
utilization fee of .15% per annum times the Total Outstandings on each day that
the sum of (i) the Total Outstandings existing on such date and (ii) the Total
Outstandings (as such term is defined in the 364-Day Credit Facility) on such
day, exceeds 30% of the sum of (x) the Aggregate Commitments (as defined herein)
existing on such day and (y) the Aggregate Commitments (as such term is defined
in the 364-Day Credit Facility) existing on such day. The utilization fee shall
be due and payable quarterly in arrears on the fifth Business Day following the
end of each calendar quarter, commencing with the first such date to occur after
the Closing Date, and on the Maturity Date. The utilization fee shall be
calculated quarterly in arrears. The utilization fee shall accrue at all times
as set forth in this Section 2.09(b), including at any time during which one or
more of the conditions in Article IV are not met.
(c) Other Fees. (i) The Company shall pay to the Arranger and the
Administrative Agent for their own respective accounts fees in the amounts and
at the times specified in the Fee Letter. Such fees shall be fully earned when
paid and shall not be refundable for any reason whatsoever.
(ii) The Borrowers shall pay to the Lenders such fees as
shall have been separately agreed upon in writing in the amounts and at the
times so specified. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES. All computations of interest
for Bankers' Acceptances and Drawing Fees, for Canadian Prime Rate Loans and for
Base Rate Loans when the Base Rate is determined by Bank of America's "prime
rate" shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed. All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which
42
results in more fees or interest, as applicable, being paid than if computed on
the basis of a 365-day year). Interest shall accrue on each Loan for the day on
which the Loan is made, and shall not accrue on a Loan, or any portion thereof,
for the day on which the Loan or such portion is paid, provided that any Loan
that is repaid on the same day on which it is made shall, subject to Section
2.12(a), bear interest for one day.
2.11 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced
by one or more accounts or records maintained by such Lender and by the
Applicable Agent in the ordinary course of business. The accounts or records
maintained by the Administrative Agent, the Canadian Administrative Agent and
each Lender shall be conclusive absent manifest error of the amount of the
Credit Extensions made by the Lenders to the Borrowers and the interest and
payments thereon. Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrowers hereunder to
pay any amount owing with respect to the Obligations. In the event of any
conflict between the accounts and records maintained by any Lender and the
accounts and records of either Agent in respect of such matters, the accounts
and records of such Agent shall control in the absence of manifest error. Upon
the request of any Lender made through the Applicable Agent, the applicable
Borrower shall execute and deliver to such Lender (through the Applicable Agent)
a Note, which shall evidence such Lender's Loans in addition to such accounts or
records. Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.
(b) In addition to the accounts and records referred to in Section
2.11(a), each Lender and the Administrative Agent shall maintain in accordance
with its usual practice accounts or records evidencing the purchases and sales
by such Lender of participations in Letters of Credit. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrowers shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Company
hereunder shall be made to the Administrative Agent, for the account of the
Lenders, at the Administrative Agent's Office in Dollars not later than 12:00
noon on the date specified herein, and all payments by McKesson Canada hereunder
shall be made to the Canadian Administrative Agent for the account of the
Canadian Lenders at the Canadian Administrative Agent's Office in Canadian
Dollars not later than 12:00 noon, Eastern time, on the date specified herein,
in each case, in immediately available funds. The Applicable Agent will promptly
distribute to each Lender its Pro Rata Share and to each Canadian Lender its
Canadian Pro Rata Share (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by an Agent after the applicable time specified in
this Section 2.12(a) shall be deemed received on the next succeeding Business
Day and any applicable interest or fee shall continue to accrue.
43
(b) If any payment to be made by a Borrower shall come due on a
day other than a Business Day, payment shall be made on the next following
Business Day, and such extension of time shall be reflected in computing
interest or fees, as the case may be.
(c) Unless a Borrower or any Lender has notified an Agent, prior
to the date any payment is required to be made by it to such Agent hereunder,
that such Borrower or such Lender, as the case may be, will not make such
payment, such Agent may assume that such Borrower or such Lender, as the case
may be, has timely made such payment and may (but shall not be so required to),
in reliance thereon, make available a corresponding amount to the Person
entitled thereto. If and to the extent that such payment was not in fact made to
such Agent in immediately available funds, then:
(i) if a Borrower failed to make such payment, each
Lender shall forthwith on demand repay to the Applicable Agent the
portion of such assumed payment, if any, that was made available to
such Lender in immediately available funds, together with interest
thereon in respect of each day from and including the date such amount
was made available by such Agent to such Lender to the date such amount
is repaid to such Agent in immediately available funds at (A) in the
case of Domestic Loans, the Federal Funds Rate from time to time in
effect and (B) in the case of Canadian Loans, the Overnight Canadian
Rate from time to time in effect; and
(ii) subject to the provisions of Section 2.01(b), if any
Lender failed to make such payment, such Lender shall forthwith on
demand pay to the Applicable Agent the amount thereof in immediately
available funds, together with interest thereon for the period from the
date such amount was made available by such Agent to a Borrower to the
date such amount is recovered by such Agent (the "Compensation Period")
at a rate per annum equal to (A) in the case of Domestic Loans, the
Federal Funds Rate from time to time in effect and (B) in the case of
Canadian Loans, the Overnight Canadian Rate from time to time in
effect. If such Lender pays such amount to such Agent, then such amount
shall constitute such Lender's Committed Loan included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Applicable Agent's demand therefor, such Agent may make a
demand therefor upon the applicable Borrower, and such Borrower shall
pay such amount to the Applicable Agent, together with interest thereon
for the Compensation Period at a rate per annum equal to the rate of
interest applicable to the applicable Borrowing. Nothing herein shall
be deemed to relieve any Lender from its obligation to fulfill its
Commitment or to prejudice any rights which either Agent or Borrower
may have against any Lender as a result of any default by such Lender
hereunder.
A notice of an Agent to any Lender or any Borrower with respect to any
amount owing under this Section 2.12(c) shall be conclusive, absent manifest
error.
(d) If any Lender makes available to either Agent funds for any
Loan to be made by such Lender as provided in the foregoing provisions of this
Article II, and such funds are not made available to the Applicable Borrower by
the Administrative Agent because the conditions to the applicable Credit
Extension set forth in Article IV are not satisfied or waived in
44
accordance with the terms hereof, such Agent shall return such funds (in like
funds as received from such Lender) to such Lender, without interest.
(e) The obligations of the Lenders hereunder to make Committed
Loans, to fund participations in Letters of Credit and to purchase Bankers'
Acceptances are several and not joint. The failure of any Lender to make any
Committed Loan, to fund any such participation or to make any such purchase on
any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Committed Loan,
fund its participation or purchase its Bankers' Acceptance.
(f) Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute
a representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.13 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Committed Loans made
by it, the Bankers' Acceptance Facility or the participations in L/C Obligations
held by it, any payment (whether voluntary, involuntary, through the exercise of
any right of set-off, or otherwise) in excess of its ratable share (or other
share contemplated hereunder) thereof, such Lender shall immediately (a) notify
the Administrative Agent of such fact, and (b) purchase from the other Lenders
such participations in the Committed Loans made by them or Bankers' Acceptances
and/or such subparticipations in the participations in L/C Obligations held by
them, as the case may be, as shall be necessary to cause such purchasing Lender
to share the excess payment in respect of such Committed Loans, Bankers'
Acceptances or such participations, as the case may be, pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Lender under any of the circumstances
described in Section 11.06 (including pursuant to any settlement entered into by
the purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered, without further
interest thereon; provided further that, for purposes of this Section 2.13, and
subject to Section 2.01(b)(ii), no Lender other than a Canadian Lender that is a
Canadian Resident may purchase any portion of or any interest in a Canadian Loan
or Bankers' Acceptance. Each Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 11.09) with respect to such participation as fully as if such Lender
were the direct creditor of such Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section 2.13 and will in each case notify the Lenders following any such
purchases or repayments. Each Lender that purchases a participation pursuant to
this Section 2.13 shall from and after such purchase have the right to give all
notices, requests, demands, directions and other communications under this
Agreement with respect to the portion of the Obligations purchased to the same
extent as though the purchasing Lender were the original owner of the
Obligations purchased.
45
2.14 CURRENCY EXCHANGE FLUCTUATIONS.
Subject to Section 3.02, if on any Computation Date the Administrative
Agent or the Canadian Administrative Agent shall have determined that (a) the
Total Outstandings exceed the Aggregate Commitments by more than $3,000,000, or
(b) the Total Canadian Outstandings exceed the Aggregate Canadian Commitments by
more than $3,000,000, in either event due to a change in applicable rates of
exchange between Dollars and Canadian Dollars, then the Administrative Agent
shall give notice to the Borrowers that a prepayment is required under this
Section 2.14, and the Borrowers agree thereupon to make prepayments of Loans
such that, after giving effect to such prepayment, the Total Outstandings do not
exceed the Aggregate Commitments and the Total Canadian Outstandings do not
exceed the Aggregate Canadian Commitments. No prepayment of Loans is required
pursuant to this Section 2.14 or Section 2.05 in the event that the Total
Outstandings exceed the Aggregate Commitments by $3,000,000 or less, or the
Total Canadian Outstandings exceed the Aggregate Canadian Commitments by
$3,000,000 or less, in either event solely due to a change in applicable rates
of exchange between Dollars and Canadian Dollars.
2.15 INCREASE IN COMMITMENTS.
(a) Provided there exists no Default, upon notice to the
Administrative Agent (which shall promptly notify the Lenders), the Company may
from time to time, request an increase in the Aggregate Commitments (as such
term is defined in this Agreement) and the Aggregate Commitments (as such term
is defined in the 364-Day Credit Facility) collectively by an aggregate amount
(for all such requests) not exceeding $400,000,000; provided, however, that any
such increase in the Commitments shall (i) prior to the Revolving Loan Maturity
Date (as such term is defined in the 364-Day Credit Facility), be allocated
between the Commitments (as such term is defined in this Agreement) and the
Commitments (as such term is defined in the 364-Day Credit Facility) on a pro
rata basis such that the proportions of each such type of Commitment as a
portion of the total Commitments are equal; and (ii) on or after the Revolving
Loan Maturity Date (as such term is defined in the 364-Day Credit Facility), be
allocated entirely to the Commitments (as such term is defined in this
Agreement). At the time of sending such notice, the Company (in consultation
with the Administrative Agent) shall specify the time period within which each
Lender is requested to respond (which shall in no event be less than ten
Business Days from the date of delivery of such notice to the Lenders). Each
Lender shall notify the Administrative Agent within such time period whether or
not it agrees to increase its Commitment and, if so, whether by an amount equal
to, greater than, or less than its Pro Rata Share of such requested increase.
Any Lender not responding within such time period shall be deemed to have
declined to increase its Commitment. The Administrative Agent shall notify the
Company and each Lender of the Lenders' responses to each request made
hereunder. To achieve the full amount of a requested increase, the Company may
also invite additional Eligible Assignees to become Lenders pursuant to a
joinder agreement in form and substance satisfactory to the Administrative Agent
and its counsel. Notwithstanding the foregoing provisions of this Section
2.15(a), during the first 90 days following the Closing Date, the Company may
invite Eligible Assignees to become Lenders under this Agreement in connection
with a requested increase without first providing any Lender with the
opportunity to increase its Commitment as provided above.
46
(b) If the Aggregate Commitments are increased in accordance with
this Section 2.15, the Administrative Agent and the Company shall determine the
effective date (the "Increase Effective Date") and the final allocation of such
increase. The Administrative Agent shall promptly notify the Company and the
Lenders of the final allocation of such increase and the Increase Effective
Date. As a condition precedent to such increase, the Company shall deliver to
the Administrative Agent a certificate of each Loan Party dated as of the
Increase Effective Date signed by a Responsible Officer of such Loan Party (i)
certifying and attaching the resolutions adopted by such Loan Party approving or
consenting to such increase, and (ii) in the case of the Company, certifying
that, before and after giving effect to such increase, (A) the representations
and warranties contained in Article V and the other Loan Documents are true and
correct on and as of the Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that, for
purposes of this Section 2.15, (1) the representation and warranty contained in
Section 5.08(a) shall be deemed to refer to the most recent statements furnished
pursuant to Sections 6.01(a) and (b), respectively, and (2) the reference to the
Closing Date in Section 5.05(b) and Section 5.08(b) shall be deemed to refer to
the Increase Effective Date and (B) no Default exists. The Company shall prepay
any Committed Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to Section 3.05) to the extent necessary to
keep the outstanding Committed Loans ratable with any revised Pro Rata Shares
arising from any nonratable increase in the Commitments under this Section 2.15.
(c) In the event of an increase in Commitments pursuant to this
Section 2.15, the provisions of this Section 2.15 shall govern any conflicts
with provisions in Sections 2.13 or 11.01.
2.16 UTILIZATION OF COMMITMENTS IN CANADIAN DOLLARS.
(a) The Administrative Agent will determine the Dollar Equivalent
amount with respect to any (i) Borrowing comprised of Canadian Loans that are
Eurodollar Rate Loans as of the date which is three Business Days prior to the
date of the requested Borrowing, (ii) Bankers' Acceptance or Borrowing comprised
of Canadian Prime Rate Loans, one day prior to the requested date of Borrowing,
(iii) outstanding Canadian Loans or Bankers' Acceptances as of the last Business
Day of each month, and (iv) conversions to or continuation of Canadian Loans as
of the date the related Committed Loan Notice is received by the Canadian
Administrative Agent or, if such conversion or continuation is performed in
accordance with Section 2.16(b) or Section 3.02, as of, in the case of Section
2.16(b), the date that the request by the Required Lenders is received by the
Administrative Agent or, in the case of Section 3.02, the date that the notice
by the Administrative Agent is received by the Borrowers and the Lenders (each
such date under clauses (i) through (iv) a "Computation Date").
(b) Notwithstanding anything herein to the contrary, during the
existence of a Default or an Event of Default, upon the request of the Required
Lenders, all or any part of any outstanding Canadian Loans consisting of
Eurodollar Rate Loans shall be converted into Canadian Prime Rate Loans with
effect from the last day of the Interest Period with respect to any such
Canadian Loans. The Administrative Agent will promptly notify the Borrowers of
any such conversion request.
47
ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Any and all payments by the Borrowers to or for the account of
any Agent or any Lender under any Loan Document shall be made free and clear of
and without deduction for any and all present or future taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and all
liabilities with respect thereto, excluding, in the case of each Agent and each
Lender, taxes imposed on or measured by its net income, taxable income, taxable
capital or similar measure and franchise taxes imposed on it (in lieu of net
income taxes), by the jurisdiction (or any political subdivision thereof) under
the Laws of which such Agent or such Lender, as the case may be, is organized or
maintains a lending office or carries on business through a permanent
establishment (all such non-excluded taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings or similar charges, and liabilities being
hereinafter referred to as "Taxes"). If the Borrowers shall be required by any
Laws to deduct any Taxes from or in respect of any sum payable under any Loan
Document to any Agent or any Lender, (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 3.01), each of such
Agent and such Lender receives an amount equal to the sum it would have received
had no such deductions been made, (ii) the Applicable Borrower shall make such
deductions, (iii) the Applicable Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
Laws, and (iv) within 30 days after the date of such payment, the Applicable
Borrower shall furnish to the Applicable Agent (which shall forward the same to
such Lender) the original or a certified copy of a receipt evidencing payment
thereof.
(b) In addition, each Borrower agrees to pay any and all present
or future stamp, court or documentary taxes and any other excise or property
taxes or charges or similar levies which arise from any payment made under any
Loan Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If a Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to
either Agent or any Lender, that Borrower shall also pay to such Agent or to
such Lender, as the case may be, at the time interest is paid, such additional
amount that such Agent or such Lender specifies is necessary to preserve the
after-tax yield (after factoring in all taxes, including taxes imposed on or
measured by net income) that such Agent or such Lender would have received if
such Taxes or Other Taxes had not been imposed.
(d) Each Borrower agrees to indemnify each Agent and each Lender
for (i) the full amount of Taxes and Other Taxes (including any Taxes or Other
Taxes imposed or asserted by any jurisdiction on amounts payable under this
Section 3.01) paid by such Agent and such Lender, (ii) amounts payable under
Section 3.01(c) and (iii) any liability (including additions to tax, penalties,
interest and expenses) arising therefrom or with respect thereto, in each case
whether or not such Taxes or Other Taxes were correctly or legally imposed or
asserted by the
48
relevant Governmental Authority. Payment under this Section 3.01(d) shall be
made within 30 days after the date the Lender or the Applicable Agent makes a
demand therefor.
(e) If any Lender or Agent, as applicable, receives a refund
(whether by way of a direct payment or by offset) of any Taxes or Other Taxes
paid by a Borrower under this Section 3.01 which, in the reasonable good faith
judgment of such Lender or Agent, as the case may be, is allocable to such
payment, the amount of such refund (net of all reasonable out-of-pocket expenses
of such Lender or Agent) shall be paid to such Borrower if (i) payment of the
Taxes or Other Taxes being refunded has been made in full as and when required
pursuant to this Section 3.01 and (ii) such Borrower agrees in writing to repay
the amount of such refund, together with interest thereon, to the applicable
Lender or Agent in the event such Lender or Agent is required to repay such
refund to the Governmental Authority that imposed the Tax or Other Tax being
refunded.
3.02 ILLEGALITY.
(a) If any Lender determines that any Law has made it unlawful, or
that any Governmental Authority has asserted that it is unlawful, for any Lender
or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans
(whether payable in Dollars or Canadian Dollars), or to determine or charge
interest rates based upon the Eurodollar Rate, then, on notice thereof by such
Lender to the Borrowers through the Applicable Agent, any obligation of such
Lender to make or continue Eurodollar Rate Loans or to convert Base Rate
Committed Loans or Canadian Prime Rate Loans, as the case may be, to Eurodollar
Rate Loans shall be suspended until such Lender notifies the Applicable Agent
and the Applicable Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, the Applicable
Borrower shall, upon demand from such Lender (with a copy to the Applicable
Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such
Lender to Base Rate Loans or Canadian Prime Rate Loans, as the case may be,
either on the last day of the Interest Period therefor, if such Lender may
lawfully continue to maintain such Eurodollar Rate Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Rate Loans. Upon any such prepayment or conversion, the Applicable
Borrower shall also pay accrued interest on the amount so prepaid or converted.
Each Lender agrees to designate a different Lending Office if such designation
will avoid the need for such notice and will not, in the good faith judgment of
such Lender, otherwise be materially disadvantageous to such Lender.
(b) Upon any Lender's giving notice and suspending its obligations
relating to Eurodollar Rate Loans in accordance with Section 3.02(a), the
Company may replace such Lender in accordance with Section 11.16.
3.03 INABILITY TO DETERMINE RATES. If the Required Lenders
determine that for any reason adequate and reasonable means do not exist for
determining the Eurodollar Base Rate for any requested Interest Period with
respect to a proposed Eurodollar Rate Loan, or that the Eurodollar Base Rate for
any requested Interest Period with respect to a proposed Eurodollar Rate Loan
does not adequately and fairly reflect the cost to such Lenders of funding such
Loan, the Administrative Agent will promptly so notify the Borrowers and each
Lender. Thereafter, the obligation of the Lenders (including Canadian Lenders)
to make or maintain Eurodollar Rate
49
Loans shall be suspended until the Administrative Agent (upon the instruction of
the Required Lenders) revokes such notice. Upon receipt of such notice, the
Borrowers may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans or
Canadian Prime Rate Loans, as the case may be, in the amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY.
(a) If any Lender, including any Canadian Lender, determines that
as a result of the introduction of or any change in or in the interpretation of
any Law, or such Lender's compliance therewith, in either case after the Closing
Date, there shall be any increase in the cost to such Lender of agreeing to make
or making, funding or maintaining Eurodollar Rate Loans, agreeing to accept or
accepting, funding or maintaining Drafts or Bankers' Acceptances, or (as the
case may be) issuing or participating in Letters of Credit, or a reduction in
the amount received or receivable by such Lender in connection with any of the
foregoing (excluding for purposes of this Section 3.04(a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements utilized in the determination of the Eurodollar Rate), then from
time to time upon demand of such Lender (with a copy of such demand to the
Administrative Agent and the Canadian Administrative Agent, if applicable), the
Applicable Borrower shall pay to such Lender such additional amounts as will
compensate such Lender for such increased cost or reduction; provided that no
Lender shall be entitled to receive additional amounts with respect to any
period prior to six months prior to making such demand.
(b) If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, in either case after the Closing Date, or compliance by such Lender (or
its Lending Office) therewith, has 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 (taking into consideration
its policies with respect to capital adequacy and such Lender's desired return
on capital), then from time to time upon demand of such Lender (with a copy of
such demand to the Administrative Agent), the Company shall pay to such Lender
such additional amounts as will compensate such Lender for such reduction;
provided that no Lender shall be entitled to receive additional amounts with
respect to any period prior to six months prior to making such demand.
3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Company shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any
Eurodollar Rate Loan on a day other than the last day of the Interest Period for
such Loan (whether voluntary, mandatory, automatic, by reason of acceleration,
or otherwise);
50
(b) any failure by a Borrower (for a reason other than the failure
of such Lender to make a Loan) to prepay, borrow, continue or convert any
Eurodollar Rate Loan on the date or in the amount notified by such Borrower; or
(c) any assignment of a Eurodollar Rate Loan on a day other than
the last day of the Interest Period therefor as a result of a request by the
Company pursuant to Section 11.16;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
For purposes of calculating amounts payable by the Company to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan made by it at the Eurodollar Base Rate used in determining the
Eurodollar Rate for such Loan by a matching deposit or other borrowing in the
London interbank eurodollar market for a comparable amount and for a comparable
period, whether or not such Eurodollar Rate Loan was in fact so funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent, the Canadian
Administrative Agent or any Lender claiming compensation under this Article III
and setting forth the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error. In determining such
amount, the Administrative Agent, the Canadian Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under
Section 3.04 or if any Borrower is required to pay amounts to any Lender under
Section 3.01 as a result of any Taxes or Other Taxes, in each case the Company
may replace such Lender in accordance with Section 11.16.
3.07 SURVIVAL. All of the Borrowers' obligations under this Article
III shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.
ARTICLE IV.
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01 CONDITIONS OF INITIAL CREDIT EXTENSION. The obligation of each
Lender to make its initial Credit Extension hereunder is subject to satisfaction
of the following conditions precedent:
(a) The Administrative Agent's receipt of the following, each of
which shall be originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of the
signing Loan Party, each dated the Closing Date (or, in the case of certificates
of governmental officials, a recent date before the Closing Date) and each in
form and substance satisfactory to the Administrative Agent and its legal
counsel:
51
(i) executed counterparts of this Agreement, sufficient
in number for distribution to the Administrative Agent, the Canadian
Administrative Agent, each Lender and each Loan Party;
(ii) if requested by any Lender at least two Business Days
before the Closing Date, a Note executed by the Applicable Borrower in
favor of each Lender so requesting a Note;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible
Officers or the corporate secretary or assistant secretary of the
Company and McKesson Canada as the Administrative Agent may require
evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in
connection with this Agreement and the other Loan Documents to which
such Loan Party is a party;
(iv) each of the following documents:
(1) the articles or certificate of incorporation
and the bylaws of each Borrower as in effect on the Closing
Date, certified by the Secretary or Assistant Secretary of
such Borrower as of the Closing Date;
(2) a good standing and tax good standing
certificate for the Company from the applicable Secretary of
State (or similar, applicable Governmental Authority) of the
States of Delaware and California dated as of a recent date;
and
(3) a certificate of status for McKesson Canada
from the Ministry of Consumer and Business Services (Ontario),
dated as of a recent date;
(v) favorable opinions, addressed to the Agents and the
Lenders, of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President and General Counsel
of the Company, as to the matters set forth in Exhibit C and such other
matters as the Administrative Agent may reasonably request, and Blake,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, Canadian counsel to the Company and McKesson
Canada, as to certain matters of Canadian law;
(vi) a certificate signed by a Responsible Officer of the
Company:
(1) certifying that:
(a) the representations and warranties
contained in Article V and the other Loan Documents are true
and correct on and as of such date, as though made on and as
of such date;
(b) no Default or Event of Default
exists or would result from the initial Borrowing;
(c) there has occurred since March 31,
2002, no event or circumstance that has resulted or could
reasonably be expected to result in a Material Adverse Effect;
52
(2) designating the Closing Date; and
(3) indicating the Debt Ratings;
(vii) a certificate signed by a Responsible Officer of
McKesson Canada certifying that:
(1) the representations and warranties of
McKesson Canada contained in Article V are true and correct on
and as of the Closing Date, as though made on and as of such
date;
(2) no Default or Event of Default with respect
to McKesson Canada or any of its Subsidiaries exists or would
result from the initial Borrowing; and
(3) there has occurred since March 31, 2002, no
event or circumstance with respect to McKesson Canada or any
of its Subsidiaries that has resulted or could reasonably be
expected to result in a Material Adverse Effect;
(viii) evidence that the Existing Credit Agreements have
been or concurrently with the Closing Date are being terminated and any
amounts outstanding thereunder have been paid in full; and
(ix) such other assurances, certificates, documents,
consents or opinions as the Administrative Agent, the Canadian
Administrative Agent, the L/C Issuer or the Required Lenders reasonably
may require.
(b) Any fees required by the Loan Documents to be paid to either
Agent, the L/C Issuer or any Lender on or before the Closing Date shall have
been paid.
(c) Unless waived by the Administrative Agent, the Company shall
have paid all Attorney Costs of the Administrative Agent to the extent invoiced
prior to or on the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute its reasonable estimate of Attorney Costs incurred or to be
incurred by it through the closing proceedings (provided that such estimate
shall not thereafter preclude a final settling of accounts between the Company
and the Administrative Agent).
(d) The Closing Date shall have occurred on or before October 31,
2002.
4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each
Lender to honor any Request for Credit Extension (other than a Committed Loan
Notice requesting only a conversion of Committed Loans to the other Type, or a
continuation of Eurodollar Rate Loans) is subject to the following conditions
precedent:
(a) The representations and warranties of each Borrower contained
in Article V or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, shall be
true and correct on and as of the date of such Credit Extension, except to the
extent that such representations and warranties specifically refer to an earlier
date, in which case they shall be true and correct as of such earlier date, and
except
53
that for purposes of this Section 4.02, the representations and warranties
contained in Section 5.08(a) shall be deemed to refer to the most recent
statements furnished pursuant Sections 6.01(a) and (b), respectively.
(b) No Default shall exist, or would result from such proposed
Credit Extension.
(c) The Administrative Agent, the Canadian Administrative Agent,
if applicable, and the L/C Issuer, if applicable, shall have received a Request
for Credit Extension in accordance with the requirements hereof.
(d) In the case of a Drawing Notice or any Loan to be made to
McKesson Canada, McKesson Canada shall be a Wholly-Owned Subsidiary of the
Company.
(e) In the case of a Drawing Notice, each of the conditions to the
acceptance of the Draft identified in such Drawing Notice that is set forth in
Section 2.04 shall have been satisfied.
Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Committed Loans to the other Type or a
continuation of Eurodollar Rate Loans) submitted by the Company or, in the case
of a Canadian Loan or Bankers' Acceptance, McKesson Canada, shall be deemed to
be a representation and warranty that the conditions specified in Sections
4.02(a), (b) and (d) have been satisfied on and as of the date of the applicable
Credit Extension.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants (which representations and
warranties in the case of McKesson Canada shall be limited to McKesson Canada
and its Subsidiaries and other facts and circumstances known to McKesson Canada
and its Subsidiaries) to the Administrative Agent, the Canadian Administrative
Agent and each Lender that:
5.01 CORPORATE EXISTENCE AND POWER. The Company and each of its
Subsidiaries:
(a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization;
(b) has the power and authority and all required governmental
licenses, authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and perform its obligations under the Loan
Documents to which it is a party;
(c) is duly qualified and is licensed and in good standing under
the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification or license;
and
(d) is in compliance with all Requirements of Law;
54
except, (i) with respect to Subsidiaries of the Company other than Material
Subsidiaries, to the extent that the failure to do so could not reasonably be
expected to have a Material Adverse Effect, and (ii) with respect to the Company
and its Material Subsidiaries (A) in each case referred to in clause (c) or
clause (d), to the extent that the failure to do so could not reasonably be
expected to have a Material Adverse Effect and (B) in each case referred to in
clause (d), the Disclosed Matters.
5.02 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution,
delivery and performance by each Borrower of this Agreement and each other Loan
Document to which such Borrower is party, and any Borrowing as of the date of
such Borrowing have been duly authorized by all necessary corporate action, and
do not and will not:
(a) contravene the terms of any Borrower's Organization Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which any Borrower is a party or any order, injunction, writ or
decree of any Governmental Authority to which any Borrower or its property is
subject; or
(c) violate any Requirement of Law.
5.03 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, any Borrower of
the Agreement or any other Loan Document.
5.04 BINDING EFFECT. This Agreement and each other Loan Document to
which each Borrower is a party constitute the legal, valid and binding
obligations of such Borrower, enforceable against such Borrower in accordance
with their respective terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors' rights generally or by equitable principles relating to
enforceability.
5.05 LITIGATION.
Except as disclosed in the Company's Annual Report on Form 10-K for the
fiscal year ended March 31, 2002 and the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 2002, each as filed with the SEC (including but
not limited to the Disclosed Matters), there are no actions, suits, proceedings,
claims or disputes pending, or to the best knowledge of each Borrower,
threatened or contemplated, at law, in equity, in arbitration or before any
Governmental Authority, against the Company, or its Subsidiaries or any of their
respective properties which:
(a) purport to affect or pertain to this Agreement or any other
Loan Document, or any of the transactions contemplated hereby or thereby; or
(b) if determined adversely to the Company or its Subsidiaries,
would reasonably be expected to have a Material Adverse Effect as of the Closing
Date. No injunction, writ, temporary restraining order or any order of any
nature has been issued by any court or other
55
Governmental Authority purporting to enjoin or restrain the execution, delivery
or performance of this Agreement or any other Loan Document, or directing that
the transactions provided for herein or therein not be consummated as herein or
therein provided.
5.06 NO DEFAULT. No Default or Event of Default exists or would
result from the incurring of any Obligations by any Borrower. As of the Closing
Date, neither the Company nor any Subsidiary is in default under or with respect
to any Contractual Obligation in any respect which, individually or together
with all such defaults, could reasonably be expected to have a Material Adverse
Effect as of the Closing Date, or that would, if such default had occurred after
the Closing Date, create an Event of Default under Section 8.01(e).
5.07 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Loans
are to be used solely for the purposes set forth in Section 6.10. Neither the
Company nor any Subsidiary is generally engaged in the business of purchasing or
selling Margin Stock or extending credit for the purpose of purchasing or
carrying Margin Stock.
5.08 FINANCIAL CONDITION. (a) The (i) Audited Financial Statements
and (ii) unaudited consolidated financial statements of the Company and its
Subsidiaries dated June 30, 2002, and the related consolidated statements of
operations, shareholders' equity and cash flows for the three months ended on
that date:
(A) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise
expressly noted therein, subject in the case of the unaudited
statements to ordinary, good faith year end audit adjustments;
(B) fairly present the financial condition of the Company
and its Subsidiaries as of the date thereof and results of operations
for the period covered thereby; and
(C) show all material indebtedness and other liabilities,
direct or contingent, of the Company and its consolidated Subsidiaries
as of the date thereof required to be shown in accordance with GAAP.
(b) As of the Closing Date, since March 31, 2002, there has been
no Material Adverse Effect.
5.09 REGULATED ENTITIES. None of the Company, any Person
controlling the Company, or any Subsidiary, is an "investment company" within
the meaning of the Investment Company Act of 1940. Neither Borrower is subject
to regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal, state or other statute or regulation limiting its ability to
incur Indebtedness.
5.10 NO BURDENSOME RESTRICTIONS. Neither the Company nor any
Subsidiary is a party to or bound by any Contractual Obligation, or subject to
any restriction in any Organization Document, or any Requirement of Law, which
could reasonably be expected to have a Material Adverse Effect.
56
5.11 SUBSIDIARIES AND CERTAIN LIENS AS OF THE CLOSING DATE. As of
the Closing Date, the Company has no Subsidiaries other than those listed in
part (a) of Schedule 5.11 hereto. As of the Closing Date, part (b) of Schedule
5.11 describes all outstanding Indebtedness of the Company and its Subsidiaries
for borrowed money in excess of $25,000,000 that is secured by a Lien existing
on property of the Company or any of its Subsidiaries.
5.12 DISCLOSED MATTERS. As of the Closing Date, based on
information available to the Company on the Closing Date, it is unlikely that,
prior to the Maturity Date, any actions, suits, proceedings or governmental
investigations, pending or threatened, comprising or resulting from the
Disclosed Matters would materially and adversely affect the ability of the
Company to perform its obligations under any Loan Document.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation (other than Obligations under Section 11.05 that remain
contingent after termination of the Commitments and payment of all other
Obligations) hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit or Bankers' Acceptance shall remain outstanding, unless the Required
Lenders waive compliance in writing:
6.01 FINANCIAL STATEMENTS. The Company shall deliver to the
Administrative Agent, in form and detail satisfactory to the Administrative
Agent and the Required Lenders:
(a) as soon as available, but in any event within 90 days after
the end of each fiscal year of the Company, a consolidated balance sheet of the
Company and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of operations, shareholders' equity and cash flows for
such fiscal year, setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail and prepared in accordance
with GAAP, audited and accompanied by a report and opinion of Deloitte & Touche
LLP or another nationally-recognized independent certified public accountant,
which report and opinion shall be prepared in accordance with GAAP and shall not
be subject to any "going concern" or like qualification or exception or any
qualification or exception as to the scope of such audit; and
(b) as soon as available, but in any event within 60 days after
the end of each of the first three fiscal quarters of each fiscal year of the
Company, beginning with the fiscal quarter ending September 30, 2002, a
consolidated balance sheet of the Company and its Subsidiaries as at the end of
such fiscal quarter, and the related consolidated statements of operations,
shareholders' equity and cash flows for such fiscal quarter and for the portion
of the Company's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail and certified by a Responsible Officer of the Company
as fairly presenting the financial condition, results of operations,
shareholders' equity and cash flows of the Company and its Subsidiaries in
accordance with GAAP, subject only to normal year-end audit adjustments and the
absence of footnotes.
57
As to any information contained in materials furnished pursuant to Section
6.02(b), the Company shall not be separately required to furnish such
information under clause (a) or (b) above, but the foregoing shall not be in
derogation of the obligation of the Company to furnish the information and
materials described in Sections 6.01(a) and (b) at the times specified therein.
6.02 CERTIFICATES; OTHER INFORMATION. The Company shall deliver to
the Administrative Agent:
(a) concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly completed Compliance Certificate
signed by a Responsible Officer of the Company;
(b) promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the stockholders of the Company, and copies of all annual, regular, periodic and
special reports and registration statements which the Company may file or be
required to file with the SEC under Section 13 or 15(d) of the Securities
Exchange Act of 1934, and not otherwise required to be delivered to the
Administrative Agent pursuant hereto; and
(c) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary, including
McKesson Canada, or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender may from time to time reasonably request.
Documents required to be delivered pursuant to Section 6.01(a) or (b)
or Section 6.02(b) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Company posts such documents, or provides a link thereto on the Company's
website on the Internet at the website address listed on Schedule 11.02; or (ii)
on which such documents are posted on the Company's behalf on
IntraLinks/IntraAgency or another relevant website, if any, to which each Lender
and the Administrative Agent have access (whether a commercial, third-party
website or whether sponsored by the Administrative Agent); provided that: (i)
upon request of the Administrative Agent or any Lender, the Company shall
deliver to such Person paper copies of such documents and (ii) the Company shall
notify (which may be by facsimile or electronic mail) the Administrative Agent
and each Lender of the posting of any such documents and provide to the
Administrative Agent by electronic mail electronic versions (i.e., soft copies)
of such documents. Notwithstanding anything contained herein, in every instance
the Company shall be required to provide paper copies of the Compliance
Certificates required by Section 6.02(a) to the Administrative Agent. Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the documents referred to
above, and in any event shall have no responsibility to monitor compliance by
the Company with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.
6.03 NOTICES. The Company and McKesson Canada shall promptly notify
the Administrative Agent and each Lender:
58
(a) of the occurrence of any Default;
(b) of any matter that has resulted or could reasonably be
expected to result in a Material Adverse Effect;
(c) promptly upon any Responsible Officer of the Company obtaining
knowledge thereof of (i) the institution of, or non-frivolous threat of, any
action, suit, proceeding (whether administrative, judicial or otherwise),
governmental investigation or arbitration against or affecting the Company or
any of its Subsidiaries or any property of the Company or any of its
Subsidiaries (collectively "Proceedings") not previously disclosed in writing by
the Company to the Lenders or (ii) any material development in any Proceeding
that, in the case of clause (i) or (ii) above, (1) if adversely determined, has
a reasonable possibility of giving rise to a Material Adverse Effect; or (2)
seeks to enjoin or otherwise prevent the consummation of, or to recover any
damages or obtain relief as a result of, the transactions contemplated hereby,
together with such other information as may be reasonably available to Company
that the Administrative Agent requests to enable the Administrative Agent and
the Lenders to evaluate such matters.
(d) of any material change in accounting policies or financial
reporting practices by the Company or any Subsidiary;
(e) of any announcement by ▇▇▇▇▇'▇ or S&P of any change or
possible change in a Debt Rating; and
(f) of (i) the occurrence of any ERISA Event with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Company or any of its Subsidiaries in an
aggregate amount in excess of $15,000,000 during the term of this Agreement, or
(ii) the existence of an amount of unfunded benefit liabilities (as defined in
Section 4001(a)(18) of ERISA), individually or in the aggregate for all Pension
Plans (excluding for purposes of such computation any Pension Plans with respect
to which assets exceed benefit liabilities), which exceeds 3% of Net Worth.
Notification delivered to the Administrative Agent and each Lender by
either Borrower under this Section 6.03 shall satisfy the notice obligation of
both Borrowers hereunder. Each notice pursuant to this Section 6.03 shall be
accompanied by a statement of a Responsible Officer of the Company setting forth
details of the occurrence referred to therein and stating what action the
Company has taken and proposes to take with respect thereto. Each notice
pursuant to Section 6.03(a) shall describe with particularity any and all
provisions of this Agreement and any other Loan Document that have been
breached.
6.04 PRESERVATION OF EXISTENCE, ETC. The Company and McKesson
Canada each shall, and shall cause each of their respective Material
Subsidiaries to, (a) preserve, renew and maintain in full force and effect its
legal existence and good standing under the Laws of the jurisdiction of its
organization except in a transaction permitted by Section 7.02 and (b) take all
reasonable action to maintain all governmental rights, privileges, permits,
licenses and franchises necessary in the normal conduct of its business, except
in connection with transactions permitted by Section 7.02 and except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect.
59
6.05 MAINTENANCE OF INSURANCE. The Company and McKesson Canada each
shall, and shall cause each of their respective Material Subsidiaries to,
maintain with financially sound and reputable insurance companies, insurance
(including self-insurance) with respect to its properties and business against
loss or damage of the kinds customarily insured against by Persons engaged in
the same or similar business, of such types and in such amounts as the Company
reasonably deems prudent from time to time.
6.06 PAYMENT OF TAXES. The Company and McKesson Canada each shall,
and shall cause each of their respective Material Subsidiaries to, pay and
discharge as the same shall become due and payable, all tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets (other than obligations that a Responsible Officer is not aware of or are
of a nominal amount), unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Company or such Subsidiary.
6.07 COMPLIANCE WITH LAWS. The Company and McKesson Canada each
shall, and shall cause each of their respective Material Subsidiaries to, comply
in all material respects with the Requirements of Law applicable to it or to its
business, except in such instances in which (a) a Requirement of Law is being
contested in good faith by appropriate proceedings diligently conducted; or (b)
the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect.
6.08 BOOKS AND RECORDS. The Company and McKesson Canada each shall,
and shall cause each of their respective Material Subsidiaries to, maintain in
all material respects proper books of record and account, in which full, true
and correct entries in conformity with GAAP consistently applied shall be made
of all financial transactions and matters involving the assets and business of
the Company and such Subsidiary, as the case may be.
6.09 INSPECTION RIGHTS. The Company and McKesson Canada each shall,
and shall cause each of their respective Material Subsidiaries to, permit
representatives and independent contractors of the Administrative Agent and each
Lender to visit and inspect any of its properties, to examine its corporate,
financial and operating records, and make copies thereof or abstracts therefrom,
and to discuss its affairs, finances and accounts with its directors, officers,
and independent public accountants, all at such reasonable times during normal
business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Company; provided, however, that when an Event of Default
exists the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
reasonable expense of the Borrowers at any time during normal business hours and
without advance notice.
6.10 USE OF PROCEEDS. The Borrowers shall use the proceeds of the
Credit Extensions for general corporate purposes (including the refinancing of
existing indebtedness, acquisitions and commercial paper back-up) not in
contravention of any Law or of any Loan Document.
60
ARTICLE VII.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation (other than Obligations under Section 11.05 that remain
contingent after termination of the Commitments and payment of all other
Obligations) hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit or Bankers' Acceptance shall remain outstanding, unless the Required
Lenders waive compliance in writing:
7.01 LIENS. The Company and McKesson Canada each shall not, and
shall not suffer or permit any of their respective Subsidiaries to, directly or
indirectly, create, incur, assume or suffer to exist any Lien upon any of its
property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):
(a) any Lien existing on property of the Company or any Subsidiary
on the Closing Date securing Indebtedness outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental
charges not yet due or which are being contested in good faith and by
appropriate proceedings diligently conducted, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance with
GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's,
landlords', repairmen's or other like Liens arising in the ordinary course of
business which are not delinquent or remain payable without penalty;
(e) pledges or deposits required in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other social security legislation, other than any Lien imposed by ERISA;
(f) Liens on the property of the Company or any Subsidiary
securing (i) the non-delinquent performance of bids, trade contracts (other than
for borrowed money), leases, statutory obligations, (ii) contingent obligations
on surety and appeal bonds, and (iii) other non-delinquent obligations of a like
nature; in each case, incurred in the ordinary course of business, provided all
such Liens in the aggregate would not (even if enforced) cause a Material
Adverse Effect;
(g) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate, are not substantial in amount, and which
do not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of the
applicable Person;
(h) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the
61
Company in excess of those set forth by regulations promulgated by the FRB, and
(ii) such deposit account is not intended by the Company or any Subsidiary to
provide collateral to the depository institution;
(i) Any other Liens (other than any Lien imposed by ERISA or any
Lien for taxes, fees, assessments or other governmental charges that is not
expressly permitted under Section 7.01(c));
provided that the aggregate amount of all Permitted Liens shall not exceed at
any time 25% of Net Worth.
7.02 CONSOLIDATIONS AND MERGERS. The Company shall not, and shall
not suffer or permit any of its Material Subsidiaries to, directly or
indirectly, liquidate, dissolve, merge, amalgamate, consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except:
(a) any Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one or
more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation;
(b) McKesson Canada or any Subsidiary of McKesson Canada may
amalgamate with McKesson Canada or with any one or more of the Company's
Subsidiaries and any of the Company's Subsidiaries may amalgamate with any one
or more of the Company's Subsidiaries;
(c) any Subsidiary may sell, transfer or exchange all or
substantially all of its assets (upon voluntary liquidation or otherwise) to the
Company or another Wholly-Owned Subsidiary; and
(d) the Company may merge with another Person provided that the
Company shall be the continuing or surviving corporation and no Default or Event
of Default is in effect immediately prior to or on the date of or would result
from such merger.
7.03 USE OF PROCEEDS. The Company and McKesson Canada each shall
not, and shall not suffer or permit any of their respective Subsidiaries to, use
any Credit Extension, directly or indirectly, (i) to purchase or carry Margin
Stock, (ii) to repay or otherwise refinance indebtedness of the Company or
others incurred to purchase or carry Margin Stock, (iii) to extend credit for
the purpose of purchasing or carrying any Margin Stock, or (iv) to acquire any
security in any transaction that is subject to Section 13 or 14 of the
Securities Exchange Act of 1934.
7.04 MAXIMUM DEBT TO CAPITALIZATION RATIO. The Company shall not
permit the ratio of Total Debt to Total Capitalization as at the last day of any
calendar month to exceed 0.565 to 1.00.
62
7.05 SWAP CONTRACTS. The Company and McKesson Canada shall, and
shall cause each of their respective Subsidiaries to, enter into Swap Contracts
only in the ordinary course of business and not for any purpose other than for
hedging an underlying agreement.
ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
8.01 EVENTS OF DEFAULT. Any of the following shall constitute an
Event of Default:
(a) Non-Payment. Either Borrower fails to pay (i) when and as
required to be paid herein, any amount of principal of any Loan, L/C Obligation
or Bankers' Acceptance, or (ii) within five days after the same becomes due, any
interest on any Loan, L/C Obligation or Bankers' Acceptance, or any facility,
utilization or other fee due hereunder, or any other amount payable hereunder or
under any other Loan Document; or
(b) Specific Covenants. The Company fails to perform or observe
any term, covenant or agreement contained in any of Section 6.04(a) or Article
VII; or
(c) Other Defaults. Either Borrower fails to perform or observe
any other covenant or agreement (not specified in Section 8.01(a) or (b))
contained in any Loan Document on its part to be performed or observed and such
failure continues for 20 days after the earlier of (i) in the case of any
provision in Article VI, the date upon which a Responsible Officer knew of such
failure or (ii) the date upon which written notice thereof is given to the
Company by the Administrative Agent or any Lenders; or
(d) Representations and Warranties. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of either
Borrower herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading in any
material respect when made or deemed made; or
(e) Cross-Default. (i) The Company or any Subsidiary (A) fails to
make any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee
(other than Indebtedness hereunder and Indebtedness under Swap Contracts) having
an aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than $25,000,000 and such failure continues after
the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure, or (B) fails to observe or perform any
other agreement or condition relating to any Indebtedness or Guarantee (other
than Indebtedness hereunder and Indebtedness under Swap Contracts) having an
aggregate principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $25,000,000 or contained in any instrument or
agreement evidencing, securing or relating thereto, and such failure continues
after the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure, or any other event occurs, the effect of
which default or other event is to cause, or to permit the holder or holders of
such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of
63
notice if required, such Indebtedness to be demanded or to become due or to be
repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an
offer to repurchase, prepay, defease or redeem such Indebtedness to be made,
prior to its stated maturity, or such Guarantee to become payable or cash
collateral in respect thereof to be demanded or (ii) there occurs under any Swap
Contract an Early Termination Date (as defined in such Swap Contract) resulting
from (A) any event of default under such Swap Contract as to which the Company
or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or
(B) any Termination Event (as so defined) under such Swap Contract as to which
the Company or any Subsidiary is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by the Company or such Subsidiary
as a result thereof is greater than $25,000,000; or
(f) Insolvency; Voluntary Proceedings. The Company or any Material
Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company or any Material Subsidiary,
or any writ, judgment, warrant of attachment, execution or similar process, is
issued or levied against a substantial part of the Company's or any Material
Subsidiary's properties, and any such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or similar
process shall not be released, vacated or fully bonded within sixty (60) days
after commencement, filing or levy; (ii) the Company or any Material Subsidiary
admits the material allegations of a petition against it in any Insolvency
Proceeding, or an order for relief (or similar order under non-U.S. law) is
ordered in any Insolvency Proceeding; or (iii) the Company or any Material
Subsidiary acquiesces in the appointment of a receiver, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor), or other
similar Person for itself or a substantial portion of its property or business;
or
(h) ERISA. (i) An ERISA Event occurs with respect to a Pension
Plan or Multiemployer Plan which has resulted or could reasonably be expected
to result in liability of the Company or any of its Subsidiaries in an
aggregate amount in excess of $25,000,000 during the term of this Agreement, or
(ii) there shall exist an amount of unfunded benefit liabilities (as defined in
Section 4001(a)(18) of ERISA), individually or in the aggregate for all Pension
Plans (excluding for purposes of such computation any Pension Plans with
respect to which assets exceed benefit liabilities), which exceeds 5% of Net
Worth.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs
and is continuing, the Administrative Agent shall, at the request of, or may,
with the consent of, the Required Lenders, take any or all of the following
actions:
(a) declare the commitment of each Lender to make Loans and accept
Drafts and any obligation of the L/C Issuer to make L/C Credit Extensions to be
terminated, whereupon such commitments and obligation shall be terminated;
64
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document (including an amount equal to the
Face Amount of all unmatured Bankers' Acceptances) to be immediately due and
payable, without presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived by each Borrower;
(c) require that the Company Cash Collateralize the L/C
Obligations (in an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to any Borrower under the Bankruptcy Code of the
United States, except in the case of Section 8.01(g)(i), in which case upon the
expiration of the 60-day period mentioned therein if the curative action
mentioned in such clause is not taken, the obligation of each Lender to make
Loans and accept or discount Drafts or Bankers' Acceptances and any obligation
of the L/C Issuer to make L/C Credit Extensions shall automatically terminate,
the unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Company to Cash Collateralize the L/C Obligations as aforesaid
shall automatically become effective, in each case without further act of the
Administrative Agent or any Lender.
8.03 APPLICATION OF FUNDS. After the exercise of remedies provided
for in Section 8.02 (or after the Loans and other Obligations have
automatically become immediately due and payable and the L/C Obligations have
automatically been required to be Cash Collateralized as set forth in the
proviso to Section 8.02), any amounts received on account of the Obligations
shall be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to the Administrative Agent, the Canadian
Administrative Agent and the L/C Issuer in their capacities as such;
Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to the Lenders (including Attorney Costs and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Second
payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans and L/C Borrowings, ratably among the
Lenders in proportion to the respective amounts described in this clause Third
payable to them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans and L/C Borrowings and to cash collateralization
of that portion of the Obligations constituting unpaid principal of the Bankers'
Acceptances, in each case ratably among the Lenders in proportion to the
respective amounts described in this clause Fourth held by them;
65
Fifth, to the Administrative Agent for the account of the L/C Issuer,
to Cash Collateralize that portion of L/C Obligations comprised of the aggregate
undrawn amount of Letters of Credit; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Applicable Borrower or as otherwise required
by Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.
ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF AGENTS.
(a) Each Lender hereby irrevocably appoints, designates and
authorizes the Administrative Agent, and each Canadian Lender hereby irrevocably
appoints, designates and authorizes the Canadian Administrative Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere herein or in
any other Loan Document, no Agent shall have any duties or responsibilities,
except those expressly set forth herein, nor shall either Agent have or be
deemed to have any fiduciary relationship with any Lender or participant, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against either Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" herein and in the other Loan
Documents with reference to the Administrative Agent and the Canadian
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable Law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith,
and the L/C Issuer shall have all of the benefits and immunities (i) provided to
the Administrative Agent in this Article IX and under Section 11.05 with respect
to any acts taken or omissions suffered by the L/C Issuer, or any other
Indemnified Liabilities of the L/C Issuer, arising out of or in connection with
Letters of Credit issued by it or proposed to be issued by it and the
applications and agreements for letters of credit pertaining to such Letters of
Credit as fully as if the term "Administrative Agent" as used in this Article IX
and in the definition of "Agent-Related Person" included the L/C Issuer with
respect to such acts or omissions or other Indemnified Liabilities, and (ii) as
additionally provided herein with respect to the L/C Issuer.
66
9.02 DELEGATION OF DUTIES. Each Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. No
Agent shall be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.
9.03 LIABILITY OF AGENTS. No Agent-Related Person shall (a) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein), or (b) be responsible
in any manner to any Lender or participant for any recital, statement,
representation or warranty made by any Loan Party or any officer thereof,
contained herein or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by
either Agent under or in connection with, this Agreement or any other Loan
Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party or any Affiliate thereof.
9.04 RELIANCE BY AGENTS.
(a) Each Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Loan Party),
independent accountants and other experts selected by such Agent. Each Agent
shall be fully justified in failing or refusing to take any action under any
Loan Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. Each Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any other Loan
Document in accordance with a request or consent of the Required Lenders (or
such greater number of Lenders as may be expressly required hereby in any
instance) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
67
9.05 NOTICE OF DEFAULT. No Agent shall be deemed to have knowledge
or notice of the occurrence of any Default, except with respect to defaults in
the payment of principal, interest and fees required to be paid to such Agent
for the account of the Lenders, unless such Agent shall have received written
notice from a Lender or a Borrower referring to this Agreement, describing such
Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default as
may be directed by the Required Lenders in accordance with Article VIII;
provided, however, that unless and until the Administrative Agent has received
any such direction, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default as it shall deem advisable or in the best interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY AGENTS. Each
Lender acknowledges that no Agent-Related Person has made any representation or
warranty to it, and that no act by the Agents hereafter taken, including any
consent to and acceptance of any assignment or review of the affairs of any Loan
Party or any Affiliate thereof, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender as to any matter,
including whether Agent-Related Persons have disclosed material information in
their possession. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Loan Parties
and their respective Subsidiaries, and all applicable bank or other regulatory
Laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Agreement and to extend credit to any Borrower hereunder.
Each Lender also represents that it will, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of any Borrower. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
an Agent herein, no Agent shall have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any
of the Loan Parties or any of their respective Affiliates which may come into
the possession of any Agent-Related Person.
9.07 INDEMNIFICATION OF AGENTS. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand
each Agent-Related Person (to the extent not reimbursed by or on behalf of any
Loan Party and without limiting the obligation of any Loan Party to do so), pro
rata, and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that no Lender shall
be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Agent-Related Person's own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the Required
Lenders shall be deemed to constitute gross negligence or willful misconduct for
68
purposes of this Section 9.07. Without limitation of the foregoing, each Lender
shall reimburse the Agents upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by either Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that such Agent is not
reimbursed for such expenses by or on behalf of the Borrowers. The undertaking
in this Section 9.07 shall survive termination of the Aggregate Commitments, the
payment of all other Obligations and the resignation of either Agent.
9.08 AGENTS IN THEIR INDIVIDUAL CAPACITIES. Bank of America, BA
Canada and their respective Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Loan Parties and their respective Affiliates
as though Bank of America were not the Administrative Agent hereunder and BA
Canada were not the Canadian Administrative Agent hereunder and without notice
to or consent of the Lenders. The Lenders acknowledge that, pursuant to such
activities, Bank of America, BA Canada or one of their Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that no Agent shall be under any obligation
to provide such information to them. With respect to their Loans, Bank of
America and BA Canada shall have the same rights and powers under this Agreement
as any other Lender and may exercise such rights and powers as though Bank of
America were not the Administrative Agent and BA Canada were not the Canadian
Administrative Agent hereunder, and the terms "Lender" and "Lenders" include
Bank of America and BA Canada in their individual capacities.
9.09 SUCCESSOR AGENTS. Either Agent may resign as an Agent upon 30
days' notice to the Lenders. If the Administrative Agent or the Canadian
Administrative Agent resigns under this Agreement, the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall be consented to by the Company at all times other than
during the existence of an Event of Default (which consent of the Company shall
not be unreasonably withheld or delayed). If no successor agent is appointed
prior to the effective date of the resignation of such Agent, such Agent may
appoint, after consulting with the Lenders and the Company, a successor agent
from among the Lenders. Upon the acceptance of its appointment as successor
agent hereunder, the Person acting as such successor agent shall succeed to all
the rights, powers and duties of the retiring Agent and, if the Administrative
Agent has resigned, the term "Administrative Agent" shall mean such successor
administrative agent and, if the Canadian Administrative Agent has resigned, the
term "Canadian Administrative Agent" shall mean such successor Canadian
administrative agent and the retiring Agent's appointment, powers and duties as
Agent shall be terminated. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article IX and Sections 11.04 and 11.05 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under this Agreement. If no successor agent has accepted
appointment as Agent by the date which is 30 days following a retiring Agent's
notice of resignation, the retiring Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Agent hereunder until such time, if any, as the Required Lenders appoint a
successor agent as provided for above.
69
9.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective of
whether the principal of any Loan, Bankers' Acceptance or L/C Obligation shall
then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
any Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, L/C
Obligations and all other Obligations that are owing and unpaid and to
file such other documents as may be necessary or advisable in order to
have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Sections 2.03(i) and (j), 2.09 and
11.04) allowed in such judicial proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 11.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
9.11 OTHER AGENTS; ARRANGERS AND MANAGERS. None of the Lenders or
other Persons identified on the facing page or signature pages of this Agreement
as a "syndication agent," "documentation agent," "co-agent," "book manager,"
"lead manager," "arranger," "lead arranger" or "co-arranger" shall have any
right, power, obligation, liability, responsibility or duty under this Agreement
other than, in the case of such Lenders, those applicable to all Lenders as
such. Without limiting the foregoing, none of the Lenders or other Persons so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.
70
ARTICLE X.
THE COMPANY'S GUARANTY
OF MCKESSON CANADA'S OBLIGATIONS
10.01 GUARANTY OF THE GUARANTIED OBLIGATIONS. The Company hereby
irrevocably and unconditionally guaranties, as primary obligor and not merely
as surety, the due and punctual payment in full of all Guarantied Obligations
when the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would become due but for the operation of the automatic stay under Section
362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)). The term "Guarantied
Obligations" is used herein in its most comprehensive sense and includes:
(a) any and all Obligations of McKesson Canada now or hereafter
made, incurred or created, whether absolute or contingent, liquidated or
unliquidated, whether due or not due, and however arising under or in connection
with this Agreement, the Notes and Drafts issued by McKesson Canada and the
other Loan Documents, including those arising under successive borrowing
transactions under this Agreement which shall either continue the Obligations of
McKesson Canada or from time to time renew them after they have been satisfied;
and
(b) those expenses set forth in Section 10.08.
10.02 LIABILITY OF THE COMPANY ABSOLUTE. The Company agrees that its
obligations under this Company Guaranty are irrevocable, absolute, independent
and unconditional and shall not be affected by any circumstance which
constitutes a legal or equitable discharge of a guarantor or surety other than
indefeasible payment in full of the Guarantied Obligations. In furtherance of
the foregoing and without limiting the generality thereof, the Company agrees as
follows:
(a) This Company Guaranty is a guaranty of payment when due and
not of collectibility.
(b) The Administrative Agent may enforce this Company Guaranty
upon the occurrence of an Event of Default under this Agreement notwithstanding
the existence of any dispute between Lenders and any Borrower with respect to
the existence of such Event of Default.
(c) The obligations of the Company under this Company Guaranty are
independent of the obligations of McKesson Canada under the Loan Documents and
the obligations of any other guarantor of the obligations of McKesson Canada
under the Loan Documents, and a separate action or actions may be brought and
prosecuted against the Company whether or not any action is brought against
McKesson Canada or any of such other guarantors and whether or not McKesson
Canada is joined in any such action or actions.
(d) The Company's payment of a portion, but not all, of the
Guarantied Obligations shall in no way limit, affect, modify or abridge the
Company's liability for any portion of the Guarantied Obligations that has not
been paid. Without limiting the generality of the foregoing, if the
Administrative Agent is awarded a judgment in any suit brought to enforce the
Company's covenant to pay a portion of the Guarantied Obligations, such judgment
shall not be deemed to
71
release the Company from its covenant to pay the portion of the Guarantied
Obligations that is not the subject of such suit.
(e) Any Agent or any Lender, upon such terms as it deems
appropriate, without notice or demand and without affecting the validity or
enforceability of this Company Guaranty or giving rise to any reduction,
limitation, impairment, discharge or termination of the Company's liability
under this Company Guaranty, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guarantied Obligations, (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guarantied Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guarantied Obligations and take and hold security for the payment of this
Company Guaranty or the Guarantied Obligations; (iv) release, surrender,
exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or
modify, with or without consideration, any security for payment of the
Guarantied Obligations, any other guaranties of the Guarantied Obligations, or
any other obligation of any Person with respect to the Guarantied Obligations;
(v) enforce and apply any security now or hereafter held by or for the benefit
of the Agents or any Lender in respect of this Company Guaranty or the
Guarantied Obligations and direct the order or manner of sale thereof, or
exercise any other right or remedy that the Agents or the Lenders, or any of
them, may have against any such security, as the Administrative Agent in its
discretion may determine consistent with this Agreement and any applicable
security agreement, including foreclosure on any such security pursuant to one
or more judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable, and even though such action operates to impair
or extinguish any right of reimbursement or subrogation or other right or remedy
of the Company against McKesson Canada or any security for the Guarantied
Obligations; and (vi) exercise any other rights available to it under the Loan
Documents. This Section 10.02(e) shall not modify Section 11.01.
(f) This Company Guaranty and the obligations of the Company
hereunder shall be valid and enforceable and shall not be subject to any
reduction, limitation, impairment, discharge or termination for any reason
(other than indefeasible payment in full of the Guarantied Obligations),
including without limitation the occurrence of any of the following, whether or
not the Company shall have had notice or knowledge of any of them: (i) any
failure or omission to assert or enforce or agreement or election not to assert
or enforce, or the stay or enjoining, by order of court, by operation of law or
otherwise, of the exercise or enforcement of, any claim or demand or any right,
power or remedy (whether arising under the Loan Documents, at law, in equity or
otherwise) with respect to the Guarantied Obligations or any agreement relating
thereto, or with respect to any other guaranty of or security for the payment of
the Guarantied Obligations; (ii) any rescission, waiver, amendment or
modification of, or any consent to departure from, any of the terms or
provisions (including without limitation provisions relating to events of
default) of this Agreement, any of the other Loan Documents or any agreement or
instrument executed pursuant thereto, or of any other guaranty or security for
the Guarantied Obligations, in each case whether or not in accordance with the
terms of this Agreement or such Loan Document or any agreement relating to such
other guaranty or security; (iii) the Guarantied Obligations, or any agreement
relating thereto, at any time being found to be illegal, invalid or
unenforceable in any respect; (iv) the application of payments received from any
source (other
72
than payments received pursuant to the other Loan Documents or from the proceeds
of any security for the Guarantied Obligations, except to the extent such
security also serves as collateral for indebtedness other than the Guarantied
Obligations) to the payment of indebtedness other than the Guarantied
Obligations, even though the Agents or the Lenders, or any of them, might have
elected to apply such payment to any part or all of the Guarantied Obligations;
(v) any Lender's or Agent's consent to the change, reorganization or termination
of the corporate structure or existence of the Company or any of its
Subsidiaries and to any corresponding restructuring of the Guarantied
Obligations; (vi) any failure to perfect or continue perfection of a security
interest in any collateral which secures any of the Guarantied Obligations;
(vii) any defenses, set-offs or counterclaims which McKesson Canada may allege
or assert against any Agent or any Lender in respect of the Guarantied
Obligations, including but not limited to failure of consideration, breach of
warranty, payment, statute of frauds, statute of limitations, accord and
satisfaction and usury; and (viii) any other act or thing or omission, or delay
to do any other act or thing, which may or might in any manner or to any extent
vary the risk of the Company as an obligor in respect of the Guarantied
Obligations.
10.03 WAIVERS BY THE COMPANY. The Company hereby waives with respect
to the Guarantied Obligations, for the benefit of the Lenders and the Agents:
(a) any right to require any Agent or any Lender, as a condition
of payment or performance by the Company, to (i) proceed against McKesson
Canada, any other guarantor of the Guarantied Obligations or any other Person,
(ii) proceed against or exhaust any security held from McKesson Canada, any
other guarantor of the Guarantied Obligations or any other Person, (iii) proceed
against or have resort to any balance of any deposit account or credit on the
books of any Agent or any Lender in favor of McKesson Canada or any other
Person, or (iv) pursue any other remedy in the power of any Agent or any Lender
whatsoever;
(b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of McKesson Canada including,
without limitation, any defense based on or arising out of the lack of validity
or the unenforceability of the Guarantied Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
McKesson Canada from any cause other than indefeasible payment in full of the
Guarantied Obligations;
(c) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal;
(d) any defense based upon any Agent's or any Lender's errors or
omissions in the administration of the Guarantied Obligations, except behavior
which amounts to bad faith;
(e) (i) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of this Guaranty and
any legal or equitable discharge of the Company's obligations hereunder, (ii)
the benefit of any statute of limitations affecting the Company's liability
hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments
and counterclaims, and (iv) promptness, diligence and any requirement that any
Agent or any
73
Lender protect, secure, perfect or insure any security interest or lien or any
property subject thereto;
(f) notices, demands, presentments, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including acceptance
of this Guaranty, notices of default under this Agreement or any agreement or
instrument related thereto, notices of any renewal, extension or modification of
the Guarantied Obligations or any agreement related thereto, notices of any
extension of credit to McKesson Canada and notices of any of the matters
referred to in Section 10.02 and any right to consent to any thereof; and
(g) any defenses or benefits that may be derived from or afforded
by law which limit the liability of or exonerate guarantors or sureties, or
which may conflict with the terms of this Company Guaranty, including without
limitation, in accordance with Section 2856 of the California Civil Code, the
provisions of California Civil Code Sections 2787-2855, inclusive, 2899 and
3433.
10.04 PAYMENT BY THE COMPANY; APPLICATION OF PAYMENTS. The Company
hereby agrees, in furtherance of the foregoing and not in limitation of any
other right which the Administrative Agent or any other Person may have at law
or in equity against the Company by virtue hereof, that upon the failure of
McKesson Canada to pay any of the Guarantied Obligations when and as the same
shall become due, whether at stated maturity, by required prepayment,
declaration, acceleration, demand or otherwise (including amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code, 11 U.S.C. Section 362(a)), the Company will upon demand
pay, or cause to be paid, in cash, to the Agent for the ratable benefit of the
Lenders holding the Guarantied Obligations, an amount equal to the sum of the
unpaid principal amount of all Guarantied Obligations then due as aforesaid,
accrued and unpaid interest on such Guarantied Obligations (including, without
limitation, interest which, but for the filing of a petition in bankruptcy with
respect to McKesson Canada, would have accrued on such Guarantied Obligations,
whether or not a claim is allowed against McKesson Canada for such interest in
any such bankruptcy proceeding) and all other Guarantied Obligations then owed
to the Administrative Agent and/or the Lenders as aforesaid. All such payments
shall be applied promptly from time to time by the Administrative Agent:
First, to the payment of the costs and expenses of any
collection or other realization under this Company Guaranty, including
reasonable compensation to the Administrative Agent and its agents and
counsel, and all expenses, liabilities and advances made or incurred by
the Administrative Agent in connection therewith;
Second, to the payment of all other Guarantied Obligations to
each Lender holding Guarantied Obligations its applicable share as
provided in this Agreement; and
Third, after payment in full of all Guarantied Obligations, to
the payment to the Company, or its successors or assigns, or to
whosoever may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct, of any surplus then remaining from
such payments.
74
10.05 GUARANTOR'S RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until
the Guarantied Obligations shall have been indefeasibly paid in full and the
Commitments shall have terminated, the Company shall withhold exercise of (a)
any claim, right or remedy, direct or indirect, the Company now has or may
hereafter have against McKesson Canada or any of its assets in connection with
this Company Guaranty or the performance by the Company of its obligations
hereunder, in each case whether such claim, right or remedy arises in equity,
under contract, by statute (including without limitation under California Civil
Code Section 2847, 2848 or 2849), under common law or otherwise and including
without limitation (i) any right of subrogation, reimbursement or
indemnification that the Company now has or may hereafter have against McKesson
Canada, (ii) any right to enforce, or to participate in, any claim, right or
remedy that any Agent or any Lender now has or may hereafter have against
McKesson Canada, and (iii) any benefit of, and any right to participate in, any
collateral or security now or hereafter held by any Agent or any Lender, and (b)
any right of contribution the Company may have against any other guarantor of
the Guarantied Obligations (including without limitation any such right of
contribution under California Civil Code Section 2848). The Company further
agrees that, to the extent the agreement to withhold the exercise of its rights
of subrogation, reimbursement, indemnification and contribution as set forth
herein is found by a court of competent jurisdiction to be void or voidable for
any reason, any rights of subrogation, reimbursement or indemnification the
Company may have against McKesson Canada or against any collateral or security,
and any rights of contribution the Company may have against any such other
guarantor, shall be junior and subordinate to any rights any Agent or any Lender
may have against McKesson Canada, to all right, title and interest any Agent or
any Lender may have in any such collateral or security, and to any right any
Agent or any Lender may have against such other guarantor. Each Agent, on behalf
of Lenders, may use, sell or dispose of any item of collateral or security as it
sees fit without regard to any subrogation rights the Company may have, and upon
any such disposition or sale any rights of subrogation against such collateral
the Company may have shall terminate. If any amount shall be paid to the Company
on account of any such subrogation, reimbursement or indemnification rights at
any time when all Guarantied Obligations shall not have been paid in full, such
amount shall be held in trust for the Administrative Agent on behalf of the
Lenders and shall forthwith be paid over to the Administrative Agent for the
benefit of the Lenders to be credited and applied against the Guarantied
Obligations, whether matured or unmatured, in accordance with the terms hereof.
10.06 SUBORDINATION OF OTHER OBLIGATIONS. Any indebtedness of
McKesson Canada now or hereafter held by the Company is hereby subordinated in
right of payment to the Guarantied Obligations, and any such indebtedness of
McKesson Canada to the Company collected or received by the Company after an
Event of Default has occurred and is continuing shall be held in trust for the
Administrative Agent on behalf of the Lenders and shall forthwith be paid over
to the Administrative Agent for the benefit of the Lenders to be credited and
applied against the Guarantied Obligations but without affecting, impairing or
limiting in any manner the liability of the Company under any other provision of
this Guaranty.
10.07 REAL PROPERTY SECURITY. The Company agrees that, if all or a
portion of the Guarantied Obligations or any other guaranty of all or a portion
of the Guarantied Obligations are at any time secured by a deed of trust or
mortgage covering interests in real property, the Administrative Agent or its
designee, in its sole discretion, without notice or demand and without affecting
the liability of the Company, may foreclose, pursuant to the terms of the Loan
75
Documents or otherwise, on any such deed of trust or mortgage and the property
described therein by nonjudicial or other sale. Without limiting any of the
waivers contained elsewhere herein, the Company hereby waives any defense to
liability arising by reason of the exercise by the Lenders or the Administrative
Agent, or any of them, of any right or remedy contained in any such deed of
trust or mortgage or any of the other Loan Documents. The Company waives all
rights and defenses arising out of an election of remedies by the Lenders or the
Administrative Agent, even though the election of remedies, such as a
nonjudicial foreclosure with respect to security for a Guarantied Obligation,
has destroyed the Company's rights of subrogation and reimbursement against
McKesson Canada by the operation of Section 580d of the California Code of Civil
Procedure or otherwise.
10.08 EXPENSES. The Company agrees to pay, or cause to be paid, on
demand, and to save the Administrative Agent and the Lenders harmless against
liability for, any and all reasonable costs and expenses (including fees and
disbursements of counsel and allocated costs of internal counsel) incurred or
expended by the Administrative Agent or any Lender in connection with the
enforcement of or preservation of any rights under this Company Guaranty.
10.09 CONTINUING GUARANTY; TERMINATION OF GUARANTY. This Company
Guaranty is a continuing guaranty and shall remain in effect until all of the
Guarantied Obligations shall have been indefeasibly paid in full and the
Commitments shall have terminated. The Company hereby irrevocably waives any
right (including without limitation any such right arising under California
Civil Code Section 2815) to revoke this Company Guaranty as to future
transactions giving rise to any Guarantied Obligations.
10.10 AUTHORITY OF THE COMPANY OR MCKESSON CANADA. It is not
necessary for any Lender or any Agent to inquire into the capacity or powers of
McKesson Canada or the officers, directors or any agents acting or purporting to
act on behalf of any of them.
10.11 FINANCIAL CONDITION OF MCKESSON CANADA. Any extensions of
credit may be granted to McKesson Canada or continued from time to time without
notice to or authorization from the Company regardless of the financial or other
condition of McKesson Canada at the time of any such grant or continuation. No
Lender or Agent shall have any obligation to disclose or discuss with the
Company their assessment, or the Company's assessment, of the financial
condition of McKesson Canada. The Company has adequate means to obtain
information from McKesson Canada on a continuing basis concerning the financial
condition of McKesson Canada and its ability to perform its obligations under
the Loan Documents, and the Company assumes the responsibility for being and
keeping informed of the financial condition of McKesson Canada and of all
circumstances bearing upon the risk of nonpayment of the Guarantied Obligations.
The Company hereby waives and relinquishes any duty on the part of any Agent or
any Lender to disclose any matter, fact or thing relating to the business,
operations or conditions of McKesson Canada now known or hereafter known by any
Agent or any Lender.
10.12 RIGHTS CUMULATIVE. The rights, powers and remedies given to
the Lenders and the Agents by this Company Guaranty are cumulative and shall be
in addition to and independent of all rights, powers and remedies given to any
Lender and any Agent by virtue of any statute or rule of law or in any of the
other Loan Documents or any agreement between the Company and any Lender and/or
any Agent or between McKesson Canada and any Lender and/or any Agent.
76
Any forbearance or failure to exercise, and any delay by any Lender or any Agent
in exercising, any right, power or remedy hereunder shall not impair any such
right, power or remedy or be construed to be a waiver thereof, nor shall it
preclude the further exercise of any such right, power or remedy.
10.13 BANKRUPTCY; POST-PETITION INTEREST; REINSTATEMENT OF GUARANTY.
(a) So long as any Guarantied Obligations remain outstanding, the Company shall
not, without the prior written consent of the Administrative Agent in accordance
with the terms of this Agreement, commence or join with any other Person in
commencing any bankruptcy, reorganization or insolvency proceedings of or
against McKesson Canada. The obligations of the Company under this Company
Guaranty shall not be reduced, limited, impaired, discharged, deferred,
suspended or terminated by any proceeding, voluntary or involuntary, involving
the bankruptcy, insolvency, receivership, reorganization, liquidation or
arrangement of McKesson Canada or by any defense which McKesson Canada may have
by reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.
(b) The Company acknowledges and agrees that any interest on any
portion of the Guarantied Obligations which accrues after the commencement of
any proceeding referred to in clause (a) above (or, if interest on any portion
of the Guarantied Obligations ceases to accrue by operation of law by reason of
the commencement of said proceeding, such interest as would have accrued on such
portion of the Guarantied Obligations if said proceedings had not been
commenced) shall be included in the Guarantied Obligations because it is the
intention of the Company and the Administrative Agent that the Guarantied
Obligations which are guarantied by the Company pursuant to this Guaranty should
be determined without regard to any rule of law or order which may relieve
McKesson Canada of any portion of such Guarantied Obligations. The Company will
permit any trustee in bankruptcy, receiver, debtor in possession, assignee for
the benefit of creditors or similar person to pay the Administrative Agent, or
allow the claim of the Administrative Agent in respect of, any such interest
accruing after the date on which such proceeding is commenced.
(c) In the event that all or any portion of the Guarantied
Obligations are paid by McKesson Canada, the obligations of the Company
hereunder shall continue and remain in full force and effect or be reinstated,
as the case may be, in the event that all or any part of such payment(s) are
rescinded or recovered directly or indirectly from any Agent or any Lender as a
preference, fraudulent transfer or otherwise, and any such payments which are so
rescinded or recovered shall constitute Guarantied Obligations for all purposes
under this Company Guaranty.
ARTICLE XI.
MISCELLANEOUS
11.01 AMENDMENTS, ETC. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Company or any other Loan Party therefrom, shall be effective unless in
writing signed by the Required Lenders and the Company or the applicable Loan
Party, as the case may be, and acknowledged by the Administrative Agent, and
each such waiver or consent shall be effective only in the specific
77
instance and for the specific purpose for which given; provided, however, that
no such amendment, waiver or consent shall:
(a) waive any condition set forth in Section 4.01(a) (other than
any condition pursuant to Section 4.01(a)(ix)) without the written consent of
each Lender;
(b) extend or increase the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 8.02) or increase or extend the
obligation of any Lender to accept Drafts except as permitted by Section 2.15,
in each case without the written consent of such Lender;
(c) postpone any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Lenders (or any of them) hereunder (including a decrease in any amount
payable in respect of the Bankers' Acceptance Facility) or under any other Loan
Document without the written consent of each Lender directly affected thereby;
(d) reduce the principal of, or the rate of interest specified
herein on, any Loan or L/C Borrowing, or (subject to clause (v) of the second
proviso to this Section 11.01) any fees or other amounts payable hereunder or
under any other Loan Document without the written consent of each Lender
directly affected thereby; provided, however, that only the consent of the
Required Lenders shall be necessary to amend the definition of "Default Rate" or
to waive any obligation of the Borrowers to pay interest at the Default Rate;
(e) change Section 2.13 or Section 8.03 in a manner that would
alter the pro rata sharing of payments required thereby without the written
consent of each Lender;
(f) change any provision of this Section 11.01 or the definition
of "Required Lenders" or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender; or
(g) release the Company from the Company Guaranty without the
written consent of each Lender;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Canadian Administrative Agent in addition to the Lenders required above,
affect the rights or duties of the Canadian Administrative Agent under this
Agreement; (iii) no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required above,
affect the rights or duties of the Administrative Agent under this Agreement or
any other Loan Document; (iv) Section 11.07(h) may not be amended, waived or
otherwise modified without the consent of each Granting Lender all or any part
of whose Loans are being funded by an SPC at the time of such amendment, waiver
or other modification; and (v) the Fee Letter may be amended, or rights or
privileges thereunder waived, only in a writing executed by the parties thereto.
Notwithstanding anything to the contrary
78
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended without the consent of such Lender.
11.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). All such written notices shall be mailed,
faxed or delivered to the applicable address, facsimile number or (subject to
Section 11.02(c)) electronic mail address, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number, as follows:
(i) if to the Company, the Administrative Agent, the L/C
Issuer or the Canadian Administrative Agent, to the address, facsimile
number, electronic mail address or telephone number specified for such
Person on Schedule 11.02 or to such other address, facsimile number,
electronic mail address or telephone number as shall be designated by
such party in a notice to the other parties; and
(ii) if to any other Lender, to the address, facsimile
number, electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Company, the Administrative
Agent, the L/C Issuer and the Canadian Administrative Agent.
All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (i) actual receipt by the relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail, four Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail (which form of delivery is subject to the provisions of Section 11.02(c)),
when delivered; provided, however, that notices and other communications to the
Administrative Agent, the L/C Issuer and the Canadian Administrative Agent
pursuant to Article II shall not be effective until actually received by such
Person. In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually-signed originals and shall be binding on all
Loan Parties, the Agents and the Lenders. An Agent may also require that any
such documents and signatures be confirmed by a manually-signed original
thereof; provided, however, that the failure to request or deliver the same
shall not limit the effectiveness of any facsimile document or signature.
(c) Limited Use of Electronic Mail. Electronic mail and Internet
and intranet websites may be used only to distribute routine communications,
such as financial statements
79
and other information as provided in Section 6.02, and to distribute Loan
Documents for execution by the parties thereto, and may not be used for any
other purpose.
(d) Reliance by Agents and Lenders. Each Agent and Lender shall be
entitled to rely and act upon any notices (including telephonic Committed Loan
Notices and Drawing Notices) purportedly given by or on behalf of the Company or
McKesson Canada which such Agent or Lender believes in good faith to have been
given by a duly authorized officer or other person authorized to borrow on
behalf of the Applicable Borrower even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood
by the recipient, varied from any confirmation thereof. Each Borrower shall
indemnify each Agent-Related Person and each Lender from all losses, costs,
expenses and liabilities resulting from the reliance by such Person on each
notice purportedly given by or on behalf of such Borrower. All telephonic
notices to and other communications with an Agent may be recorded by such Agent,
and each of the parties hereto hereby consents to such recording.
11.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or
the Agents to exercise, and no delay by any such Person in exercising, any
right, remedy, power or privilege hereunder shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
11.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrowers agree,
jointly and severally, (a) to pay or reimburse the Agents for all costs and
expenses incurred in connection with the development, preparation, negotiation
and execution of this Agreement and the other Loan Documents and any amendment,
waiver, consent or other modification of the provisions hereof and thereof
(whether or not the transactions contemplated hereby or thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs, and (b) to pay or
reimburse the Agents and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Agents and the cost of independent public
accountants and other outside experts retained by the Agents or any Lender. All
amounts due under this Section 11.04 shall be payable within 20 Business Days
after demand therefor. The agreements in this Section 11.04 shall survive the
termination of the Aggregate Commitments and repayment of all other Obligations.
11.05 INDEMNIFICATION BY THE BORROWERS. Whether or not the
transactions contemplated hereby are consummated, the Borrowers shall jointly
and severally indemnify and hold harmless each Agent-Related Person, each Lender
and their respective Affiliates, directors, officers, employees, counsel, agents
and attorneys-in-fact (collectively the "Indemnitees") from
80
and against any and all liabilities, obligations, losses, damages, penalties,
claims, demands, actions, judgments, suits, costs, expenses and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time be imposed on, incurred by or asserted against any such Indemnitee in any
way relating to or arising out of or in connection with (a) the execution,
delivery, enforcement, performance or administration of any Loan Document or any
other agreement, letter or instrument delivered in connection with the
transactions contemplated thereby or the consummation of the transactions
contemplated thereby, (b) any Commitment, Loan or Letter of Credit or the use or
proposed use of the proceeds therefrom (including any refusal by the L/C Issuer
to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), or related to any Canadian Dollar transactions or (c)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory (including any investigation of, preparation for, or defense of any
pending or threatened claim, investigation, litigation or proceeding) and
regardless of whether any Indemnitee is a party thereto (all the foregoing,
collectively, the "Indemnified Liabilities"); provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses or disbursements which (i) are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee or (ii) result
from claims by a Borrower against such Indemnitee that are successful on the
merits as determined by a court of competent jurisdiction. No Indemnitee shall
be liable for any damages arising from the use by others of any information or
other materials obtained through IntraLinks or other similar information
transmission systems in connection with this Agreement, nor shall any Indemnitee
have any liability for any indirect or consequential damages relating to this
Agreement or any other Loan Document or arising out of its activities in
connection herewith or therewith (whether before or after the Closing Date). All
amounts due under this Section 11.05 shall be payable within 20 Business Days
after demand therefor. The agreements in this Section 11.05 shall survive the
resignation of the Administrative Agent, the Canadian Administrative Agent or
the L/C Issuer, the replacement of any Lender, the termination of the Aggregate
Commitments and the repayment, satisfaction or discharge of all the other
Obligations.
11.06 PAYMENTS SET ASIDE. To the extent that any payment by or on
behalf of a Borrower is made to either Agent or any Lender, or either Agent or
any Lender exercises its right of set-off, and such payment or the proceeds of
such set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by an Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Applicable Agent upon demand its applicable share
of any amount so recovered from or repaid by such Agent, plus interest thereon
from the date of such demand to the date such payment is made at a rate per
annum equal to (A) in the case of Domestic Loans and L/C Credit Extensions, the
Federal Funds Rate from time to time in effect and (B) in the case of Canadian
Loans and Bankers' Acceptance Credit Extensions, the Overnight Canadian Rate
from time to time in effect.
81
11.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrowers may not assign or otherwise
transfer any of their rights or obligations hereunder without the prior written
consent of each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of Section 11.07(b), (ii) by way of participation in
accordance with the provisions of Section 11.07(d), (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Sections
11.07(f) and (i), or (iv) to an SPC in accordance with the provisions of Section
11.07(h) (and any other attempted assignment or transfer by any party hereto
shall be null and void). Nothing in this Agreement, expressed or implied, shall
be construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent
provided in Section 11.07(d) and, to the extent expressly contemplated hereby,
the Indemnitees) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans (including for
purposes of this Section 11.07(b), participations in L/C Obligations) at the
time owing to it); provided that (i) except in the case of an assignment of the
entire remaining amount of the assigning Lender's Commitment and the Loans at
the time owing to it or in the case of an assignment to a Lender or an Affiliate
of a Lender, the aggregate amount of the Commitment (which for this purpose
includes Loans outstanding thereunder) subject to each such assignment,
determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent or, if "Trade Date" is
specified in the Assignment and Assumption, as of the Trade Date, shall not be
less than $5,000,000 unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Company otherwise consents
(each such consent not to be unreasonably withheld or delayed); (ii) each
partial assignment shall be made as an assignment of a proportionate part of all
the assigning Lender's rights and obligations under this Agreement with respect
to the Loans or the Commitment assigned, (iii) any assignment of a Commitment
must be approved by the Administrative Agent unless the Person that is the
proposed assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); and (iv) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee of $3,500.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to Section 11.07(c), from and after the effective date specified in each
Assignment and Assumption, the Eligible Assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 11.04 and 11.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, each Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender.
82
Any assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 11.07(b) shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with Section 11.07(d).
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrowers, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrowers, the Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Company and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
(d) In addition to sales of Canadian Participations by Canadian
Lenders pursuant to Section 2.01(b)(ii), any Lender may at any time, without the
consent of, or notice to, the Administrative Agent, sell participations to any
Person (other than a natural person or either Borrower or any of the Borrowers'
Affiliates or Subsidiaries) (each, a "Participant") in all or a portion of such
Lender's rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans (including such Lender's
participations in L/C Obligations) owing to it); provided that (i) unless a
Default or Event of Default has occurred and is continuing, the Company shall
have approved the sale of participations to such Person (such approval not to be
unreasonably withheld or delayed); (ii) no participations in Canadian Loans or
Bankers' Acceptances shall be sold to any Person that is not a Canadian
Resident; (iii) such Lender's obligations under this Agreement shall remain
unchanged; (iv) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations; and (v) the Borrowers, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement; provided further that clauses (i) through (v)
of the foregoing proviso are not applicable to Canadian Participations. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, waiver or other modification described in the first proviso to
Section 11.01 that directly affects such Participant. Subject to Section
11.07(e), the Borrowers agree that each Participant shall be entitled to the
benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to Section 11.07(b).
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 11.09 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 3.01 or 3.04 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Company's prior written consent. A Participant that would be a Foreign Lender if
it were a Lender shall not be entitled to the benefits of Section 3.01 unless
the Company is
83
notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Company, to comply with Section 11.15 as though
it were a Lender.
(f) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
(g) As used herein, the following terms have the following
meanings:
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; and (c) any other Person (other than a natural person) approved
by (i) the Administrative Agent, and (ii) unless a Default or an Event
of Default has occurred and is continuing, the Company (each such
approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, (i) "Eligible Assignee" shall not
include either Borrower or any of the Borrowers' Affiliates or
Subsidiaries and (ii) in the case of clauses (a) and (b), no such
Lender or Affiliate shall be an Eligible Assignee for purposes of
Canadian Loans or Bankers' Acceptances unless such Person is a Canadian
Resident.
(h) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Company (an "SPC") the option to provide all or any
part of any Committed Loan that such Granting Lender would otherwise be
obligated to make pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPC to fund any Committed Loan, and (ii) if
an SPC elects not to exercise such option or otherwise fails to make all or any
part of such Committed Loan, the Granting Lender shall be obligated to make such
Committed Loan pursuant to the terms hereof; provided further that no such grant
to an SPC shall impose Taxes or Other Taxes on either Borrower. Each party
hereto hereby agrees that (i) neither the grant to any SPC nor the exercise by
any SPC of such option shall increase the costs or expenses or otherwise
increase or change the obligations of the Company under this Agreement
(including its obligations under Section 3.04), (ii) no SPC shall be liable for
any indemnity or similar payment obligation under this Agreement for which a
Lender would be liable, and (iii) the Granting Lender shall for all purposes,
including the approval of any amendment, waiver or other modification of any
provision of any Loan Document, remain the lender of record hereunder. The
making of a Committed Loan by an SPC hereunder shall utilize the Commitment of
the Granting Lender to the same extent, and as if, such Committed Loan were made
by such Granting Lender. In furtherance of the foregoing, each party hereto
hereby agrees (which agreement shall survive the termination of this Agreement)
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other senior debt of any SPC, it will not
institute against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency, or liquidation proceeding
under the laws of the United States or any State thereof. Notwithstanding
anything to the contrary contained herein, any SPC may (i) with notice to, but
without prior consent of the Company and the Administrative Agent and without
paying any processing fee therefor, assign all or any portion
84
of its right to receive payment with respect to any Committed Loan to the
Granting Lender and (ii) disclose on a confidential basis any non-public
information relating to its funding of Committed Loans to any rating agency,
commercial paper dealer or provider of any surety or Guarantee or credit or
liquidity enhancement to such SPC.
(i) Notwithstanding anything to the contrary contained herein, any
Lender that is a Fund may create a security interest in all or any portion of
the Loans owing to it and the Note, if any, held by it to the trustee for
holders of obligations owed, or securities issued, by such Fund as security for
such obligations or securities, provided that unless and until such trustee
actually becomes a Lender in compliance with the other provisions of this
Section 11.07, (i) no such pledge shall release the pledging Lender from any of
its obligations under the Loan Documents and (ii) such trustee shall not be
entitled to exercise any of the rights of a Lender under the Loan Documents even
though such trustee may have acquired ownership rights with respect to the
pledged interest through foreclosure or otherwise. For purposes of this Section
11.07(i), "Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
(j) Notwithstanding anything to the contrary contained herein, if
at any time Wachovia Bank, National Association assigns all of its Commitment
and Loans pursuant to Section 11.07(b), Wachovia Bank, National Association may,
upon 30 days' notice to the Company and the Lenders, resign as L/C Issuer. In
the event of any such resignation as L/C Issuer, the Company shall be entitled
to appoint from among the Lenders a successor L/C Issuer hereunder; provided,
however, that no failure by the Company to appoint any such successor shall
affect the resignation of Wachovia Bank, National Association as L/C Issuer. In
the event that each Lender selected by the Company as L/C Issuer declines the
appointment, Bank of America shall become the L/C Issuer, without further action
by the Company or the Lenders. If Wachovia Bank, National Association resigns as
L/C Issuer, it shall retain all the rights and obligations of the L/C Issuer
hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Committed
Loans or fund risk participations in Unreimbursed Amounts pursuant to Section
2.03(c)).
11.08 CONFIDENTIALITY. Each of the Agents and Lenders agrees to
maintain, and to cause its Affiliates (including any Agent-Related Persons) to
maintain, the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential); (b) to the extent requested by any regulatory
authority having jurisdiction over such Person; (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process; (d)
to any other party to this Agreement; (e) to the extent reasonably required, in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder;
(f) subject to an agreement containing provisions substantially the same as
those of this Section 11.08, to (i) any Eligible Assignee of or Participant in,
or any prospective Eligible Assignee of or Participant in, any of its rights or
obligations under this Agreement or (ii) any direct or indirect contractual
85
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Loan Parties under the Loan
Documents; (g) with the consent of the Company; or (h) to the extent such
Information (i) becomes publicly available other than as a result of a breach of
this Section 11.08 or (ii) becomes available to the Administrative Agent or any
Lender on a nonconfidential basis from a source other than the Company;
provided, however, that to the extent permitted by applicable law or regulation,
each of the Agents and Lenders agrees to notify the Company prior to (if
reasonably practicable) or concurrently with its disclosure of such information
to any third party pursuant to clauses (c) and (f). In addition, the
Administrative Agent and the Lenders may disclose the existence of this
Agreement and public information about this Agreement to market data collectors,
similar service providers to the lending industry, and service providers to the
Administrative Agent and the Lenders in connection with the administration and
management of this Agreement, the other Loan Documents, the Commitments, and the
Credit Extensions. For the purposes of this Section 11.08, "Information" means
all information received from any Loan Party relating to any Loan Party or its
business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by any Loan Party; provided that, in the case of information received
from a Loan Party after the date hereof, such information is clearly identified
at the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section 11.08 shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
11.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrowers, any such notice being waived by the Borrowers 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 by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the respective Loan Parties against any and all Obligations owing
to such Lender hereunder or under any other Loan Document, now or hereafter
existing, irrespective of whether or not the Administrative Agent or such Lender
shall have made demand under this Agreement or any other Loan Document and
although such Obligations may be contingent or unmatured or denominated in a
currency different from that of the applicable deposit or indebtedness. Each
Lender agrees promptly to notify the Borrowers and the Administrative Agent
after any such set-off and application made by such Lender; provided, however,
that the failure to give such notice shall not affect the validity of such
set-off and application.
11.10 INTEREST RATE LIMITATION. Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid
under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "Maximum Rate"). If either Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to the Applicable Borrower. In
determining whether the interest contracted for, charged, or received by the
Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to
the extent permitted by applicable Law, (a) characterize
86
any payment that is not principal as an expense, fee, or premium rather than
interest, (b) exclude voluntary prepayments and the effects thereof, and (c)
amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Obligations
hereunder.
11.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
11.12 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Agents or the Lenders in any
other Loan Document shall not be deemed a conflict with this Agreement. Each
Loan Document was drafted with the joint participation of the respective parties
thereto and shall be construed neither against nor in favor of any party, but
rather in accordance with the fair meaning thereof.
11.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made hereunder and in any other Loan Document or
other document delivered pursuant hereto or thereto or in connection herewith or
therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by each Agent
and each Lender, regardless of any investigation made by either Agent or any
Lender or on their behalf and notwithstanding that either Agent or any Lender
may have had notice or knowledge of any Default at the time of any Credit
Extension, and shall continue in full force and effect as long as any Loan or
any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter
of Credit shall remain outstanding.
11.14 SEVERABILITY. If any provision of this Agreement or the other
Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired thereby
and (b) the parties shall endeavor in good faith negotiations to replace the
illegal, invalid or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
11.15 TAX FORMS. (a) (i) Each Lender that is not a "United States
person" within the meaning of Section 7701(a)(30) of the Code (a "Foreign
Lender") shall deliver to the Administrative Agent, prior to receipt of any
payment subject to withholding under the Code (or upon accepting an assignment
of an interest herein), two duly signed completed copies of either IRS Form
W-8BEN or any successor thereto (relating to such Foreign Lender and entitling
it to an exemption from, or reduction of, withholding tax on all payments to be
made to such Foreign Lender by the Company pursuant to this Agreement) or IRS
Form W-8ECI or any successor thereto (relating to all payments to be made to
such Foreign Lender by the Borrowers pursuant to this Agreement) or such other
evidence satisfactory to the Company and the Administrative
87
Agent that such Foreign Lender is entitled to an exemption from, or reduction
of, U.S. withholding tax, including any exemption pursuant to Section 881(c) of
the Code. Thereafter and from time to time, each such Foreign Lender shall (A)
promptly submit to the Administrative Agent such additional duly completed and
signed copies of one of such forms (or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities) as may then
be available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to the Company and the Administrative Agent of
any available exemption from or reduction of, United States withholding taxes in
respect of all payments to be made to such Foreign Lender by the Company
pursuant to this Agreement, (B) promptly notify the Administrative Agent of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction, and (C) take such steps as shall not be materially
disadvantageous to it, in the reasonable judgment of such Lender, and as may be
reasonably necessary (including the re-designation of its Lending Office) to
avoid any requirement of applicable Laws that the Company make any deduction or
withholding for taxes from amounts payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases
to act for its own account with respect to any portion of any sums paid or
payable to such Lender under any of the Loan Documents (for example, in the case
of a typical participation by such Lender), shall deliver to the Administrative
Agent on the date when such Foreign Lender ceases to act for its own account
with respect to any portion of any such sums paid or payable, and at such other
times as may be necessary in the determination of the Administrative Agent (in
the reasonable exercise of its discretion), (A) two duly signed completed copies
of the forms or statements required to be provided by such Lender as set forth
above, to establish the portion of any such sums paid or payable with respect to
which such Lender acts for its own account that is not subject to U.S.
withholding tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or
any successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its own
account with respect to a portion of any such sums payable to such Lender.
(iii) The Company shall not be required to pay any additional amount
to any Foreign Lender under Section 3.01 (A) with respect to any Taxes required
to be deducted or withheld on the basis of the information, certificates or
statements of exemption such Lender transmits with an IRS Form W-8IMY pursuant
to this Section 11.15(a) or (B) if such Lender shall have failed to satisfy the
foregoing provisions of this Section 11.15(a); provided that if such Lender
shall have satisfied the requirement of this Section 11.15(a) on the date such
Lender became a Lender or ceased to act for its own account with respect to any
payment under any of the Loan Documents, nothing in this Section 11.15(a) shall
relieve the Company of its obligation to pay any amounts pursuant to Section
3.01 in the event that, as a result of any subsequent change in any applicable
law, treaty or governmental rule, regulation or order, or any subsequent change
in the interpretation, administration or application thereof, such Lender is no
longer properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender or other Person for the
account of which such Lender receives any sums payable under any of the Loan
Documents is not subject to withholding or is subject to withholding at a
reduced rate.
88
(iv) The Administrative Agent may, without reduction, withhold any
Taxes required to be deducted and withheld from any payment under any of the
Loan Documents with respect to which the Company is not required to pay
additional amounts under this Section 11.15(a).
(b) Upon the request of the Administrative Agent, each Lender that
is a "United States person" within the meaning of Section 7701(a)(30) of the
Code shall deliver to the Administrative Agent two duly signed completed copies
of IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.
(c) If any Governmental Authority asserts that the Administrative
Agent did not properly withhold or backup withhold, as the case may be, any tax
or other amount from payments made to or for the account of any Lender, such
Lender shall indemnify the Administrative Agent therefor, including all
penalties and interest, any taxes imposed by any jurisdiction on the amounts
payable to the Administrative Agent under this Section 11.15, and costs and
expenses (including Attorney Costs) of the Administrative Agent. The obligation
of the Lenders under this Section 11.15 shall survive the termination of the
Aggregate Commitments, repayment of all other Obligations hereunder and the
resignation of the Administrative Agent.
(d) Each Canadian Lender hereby represents and warrants that it is
a Canadian Resident, and each Canadian Lender agrees that if the foregoing
representation is inaccurate with respect to such Canadian Lender in any
material respect, then the Applicable Borrower shall not be required to pay to
such Canadian Lender any amounts pursuant to Section 3.01 relating to any Taxes
resulting solely from such inaccuracy. If a Borrower is required to pay amounts
to any Canadian Lender pursuant to Section 3.01 (whether by reason of such
Canadian Lender's change of status or otherwise), then such Canadian Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to take such actions as are necessary to minimize such Borrower's obligations
under Article III, if such actions, in the sole judgment of such Canadian
Lender, are not otherwise disadvantageous to such Canadian Lender.
11.16 REPLACEMENT OF LENDERS.
Under any circumstances set forth herein providing that the Company
shall have the right to replace a Lender as a party to this Agreement, or if the
Administrative Agent and the Company have mutually determined that a Lender is a
Defaulting Lender, in either case the Company may, upon notice to such Lender
and the Administrative Agent, replace such Lender by causing such Lender to
assign its Commitment (with the assignment fee to be paid by the Company in such
instance) pursuant to Section 11.07(b) to one or more other Lenders or Eligible
Assignees procured by the Company; provided, however, that if the Company elects
to exercise such right with respect to any Lender pursuant to Section 3.06(b),
it shall be obligated to replace all Lenders that have made similar requests for
compensation pursuant to Section 3.01 or 3.04. The Company shall (i) pay in full
all principal, interest, fees and other amounts owing to such Lender through the
date of replacement (including any amounts payable pursuant to Section 3.05),
(ii) provide appropriate assurances and indemnities (which may include letters
of credit) to the L/C Issuer as each may reasonably require with respect to any
continuing
89
obligation to fund participation interests in any L/C Obligations then
outstanding, and (iii) release such Lender from its obligations under the Loan
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Assumption with respect to such Lender's Commitment and outstanding Loans and
participations in L/C Obligations.
11.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, the LAW OF THE STATE OF CALIFORNIA applicable to agreements
made and to be performed entirely within such State; PROVIDED THAT THE AgentS,
THE L/C ISSUER AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH STATE, AND
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWERS, THE Agents, THE L/C
ISSUER AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWERS, THE Agents, THE
l/c issuer AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. THE BORROWERS, THE AgentS, THE L/C ISSUER AND EACH
LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
(c) The Borrowers expressly require that this document and all
documents accessory hereto be drawn up in English and each Agent and each
Lender, because of the customer's requirement and by making such documents
available to the customer in the English language, expresses the same
requirement.
Les Emprunteurs requierent expressement que ce document et tous les
documents qui s'y rapportent soient rediges en langue anglaise et chaque
Mondataire et chaque Banque, a cause de cette exigence du client, exprime la
meme volonte en faisant en sorte que les documents en langue anglaise soient a
la disposition du client.
11.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN
90
CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT
ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT
TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 11.18 WITH ANY COURT AS WRITTEN EVIDENCE
OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY.
11.19 JUDGMENT. If, for the purposes of obtaining judgment in any
court, it is necessary to convert a sum due hereunder or any other Loan Document
in one currency into another currency, the rate of exchange used shall be that
at which in accordance with normal banking procedures the Administrative Agent
could purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of a Borrower in
respect of any such sum due from it to the Administrative Agent hereunder or
under the other Loan Documents shall, notwithstanding any judgment in a currency
(the "Judgment Currency") other than that in which such sum is denominated in
accordance with the applicable provisions of this Agreement (the "Agreement
Currency"), be discharged only to the extent that on the Business Day following
receipt by the Administrative Agent of any sum adjudged to be so due in the
Judgment Currency, the Administrative Agent may in accordance with normal
banking procedures purchase the Agreement Currency with the Judgment Currency.
If the amount of the Agreement Currency so purchased is less than the sum
originally due to the Administrative Agent in the Agreement Currency, the
Borrowers agree, as a separate obligation and notwithstanding any such judgment,
jointly and severally, to indemnify the Administrative Agent or the Person to
whom such obligation was owing against such loss. If the amount of the Agreement
currency so purchased is greater than the sum originally due to the
Administrative Agent in such currency, the Administrative Agent agrees to return
the amount of any excess to the Applicable Borrower (or to any other Person who
may be entitled thereto under applicable law).
91
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
MCKESSON CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President and Chief
Financial Officer
and
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President and Treasurer
MCKESSON CANADA CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President and Treasurer
BANK OF AMERICA, N.A., as
Administrative Agent
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Agency Management Officer
BANK OF AMERICA, N.A., as
a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
Title: Managing Director
BANK OF AMERICA, N.A. (ACTING THROUGH
ITS CANADIAN BRANCH), as
Canadian Administrative Agent
By: /s/ ▇▇▇▇▇▇ Sales ▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ Sales ▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice-President
BANK OF AMERICA, N.A. (ACTING THROUGH
ITS CANADIAN BRANCH), as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇
Title: Vice-President
JPMORGAN CHASE BANK, as
a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
WACHOVIA BANK, NATIONAL
ASSOCIATION, as L/C Issuer and as a Lender
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
BANK ONE, NA, as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Director
US BANK NATIONAL ASSOCIATION, as
a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
TORONTO DOMINION (TEXAS), INC., as
a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
THE TORONTO-DOMINION BANK, as a Lender
By: /s/ ▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Vice President
THE BANK OF NOVA SCOTIA, as
a Lender
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Managing Director
BANK OF NOVA SCOTIA, as
a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Director
▇▇▇▇▇▇ BROTHERS BANK, FSB, as
a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK, NA, as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
THE BANK OF NEW YORK, as
a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
SUNTRUST BANK, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
FIFTH THIRD BANK, as
a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Large Corporate Officer
SCHEDULE 1.01
EXISTING LETTERS OF CREDIT
------------------------------------------------------------------------------------------------
ISSUER BENEFICIARY L/C NUMBER US$ AMOUNT EXPIRATION DATE TYPE
------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------
Wachovia Oklahoma Workers SM415356C 10,000.00 1/01/03 Auto-
Bank,National Compensation Court Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Old Republic SM415355C 9,337,455.00 1/01/03 Auto-
Bank, National Insurance Company Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Old Republic SM415750C 1,401,261.00 1/01/03 Auto-
Bank, National Insurance Company Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Home Insurance Co. SM415360C 915,300.00 1/01/03 Auto-
Bank, National Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Amli Will County SM415803C 257,622.00 10/31/02 Final
Bank, National Properties LP Maturity
Association
------------------------------------------------------------------------------------------------
Wachovia Traveler's Indemnity SM415800C 150,000.00 3/31/03 Auto-
Bank, National Company Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Traveler's Indemnity SM415802C 176,000.00 3/31/03 Auto-
Bank, National Company Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Traveler's Indemnity SM416740C 659,000.00 4/30/03 Auto-
Bank, National Company Renewable
Association
------------------------------------------------------------------------------------------------
Wachovia Continental Casualty SM417046C 5,000,000.00 2/23/03 Final
Bank, National Company Maturity
Association
------------------------------------------------------------------------------------------------
Wachovia State of Minnesota SM415357C 540,000.00 1/01/03 Auto-
Bank, National Dept of Comm Renewable
Association
------------------------------------------------------------------------------------------------
1
SCHEDULE 2.01
COMMITMENTS, PRO RATA SHARES
AND AFFILIATE BANKS
CANADIAN
CANADIAN COMMITMENTS CANADIAN PRO TOTAL TOTAL PRO RATA
DOMESTIC LENDER LENDER (IN U.S.DOLLARS)* RATA SHARE COMMITMENT SHARE
------------------------------------------------------------------------------------------------------------
Bank of America, BA Canada $ 64,948,453.61 43.298969072% $105,000,000.00 19.090909091%
N.A.
JPMorgan Chase
Bank 0 $100,000,000.00 18.181818182%
Wachovia Bank,
National
Association 0 $ 87,500,000.00 15.909090909%
Bank One, NA Bank One, NA $ 38,659,793.81 25.773195876% $ 62,500,000.00 11.363636364%
US Bank National
Association 0 $ 37,500,000.00 6.818181818%
Toronto Dominion The ▇▇▇▇▇▇▇-
(▇▇▇▇▇), Inc. Dominion Bank $ 23,195,876.29 15.463917526% $ 37,500,000.00 6.818181818%
The Bank of Nova The Bank of
Scotia Nova Scotia $ 23,195,876.29 15.463917526% $ 37,500,000.00 6.818181818%
▇▇▇▇▇▇ Brothers
Bank, FSB 0 $ 25,000,000.00 4.545454545%
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇ ▇ $ 20,000,000.00 3.636363636%
The Bank of New
York 0 $ 12,500,000.00 2.272727273%
SunTrust Bank 0 $ 12,500,000.00 2.272727273%
Fifth Third Bank 0 $ 12,500,000.00 2.272727273%
TOTALS: $ 150,000,000.00 100.000000000% $550,000,000.00 100.000000000%
*Please see Section 2.01(a)(ii).
1
SCHEDULE 5.11
SUBSIDIARIES
AND INDEBTEDNESS SECURED BY LIENS
Part (a). Subsidiaries.
1258741 Ontario Inc.
3068312 Nova Scotia ULC
646543 B.C. Ltd
650032 B.C. Ltd.
Access Health UK Ltd.
A.L.I. Holdings LLC
A.L.I. Imaging Systems Corp.
A.L.I. Technologies (Deutschland) GmbH
A.L.I. Technologies (Europe) B.V.
A.L.I. Technologies (International) LLC
A.L.I. Technologies Inc.
Beldere Corporation
California Golden State Finance Company
CGSF Funding Corporation
CPG Industries, Inc.
▇▇▇▇▇▇▇ Plaza Company
Data-Med Computer Services Ltd.
DC Land Company
DCAZ Land Company
Foremost Homes Hawaii, Ltd.
Foremost Iran Corporation
Foremost Shir, Inc.
Foremost Tehran, Inc.
Golden State Insurance Company Limited
Good Neighbour Pharmacy Ltd.
▇▇▇▇▇▇▇ Manufacturing Company
HBO & Company (ST&SW) Ltd.
HBO & Company (VI), Inc.
HBOC Medical Ltd.
Health Mart Systems, Inc.
HF Land Company
▇. ▇▇▇▇▇▇▇ and Company, Inc. *
KWS & P, Inc.
KWS & P / SFA, Inc.
* Sale pending
MCK Acquisition Corp.
McKesson (Cayman Islands) Inc.
McKesson Asia-Pacific PTY Limited
McKesson Automation Canada Inc.
McKesson Automation Inc.
McKesson Automation Systems Inc.
McKesson BioServices Corporation
McKesson Canada Alberta Limited
McKesson Canada Corporation
McKesson Canada Health Care Partners Ltd.
McKesson Canada Inc.
McKesson Canada Limited
McKesson Capital Corp.
McKesson Development Corp.
McKesson Finance Company of Canada
McKesson Financial Holdings Limited
McKesson Health Solutions Arizona Inc.
McKesson Health Solutions Canada Inc.
McKesson Health Solutions Holdings Inc.
McKesson Health Solutions LLC
McKesson Health Solutions Puerto Rico Inc.
McKesson Health Solutions Texas Inc.
McKesson Information Solutions Canada Ltd.
McKesson Information Solutions Capital S.a.r.l.
McKesson Information Solutions Finance S.a.r.l.
McKesson Information Solutions France ▇▇
▇▇▇▇▇▇▇▇ Information Solutions (Gibraltar) Ltd.
McKesson Information Solutions Holdings France S.a.r.l.
McKesson Information Solutions Holdings Limited
McKesson Information Solutions Holdings S.a.r.l.
McKesson Information Solutions Inc.
McKesson Information Solutions International S.a.r.l.
McKesson Information Solutions Ireland Limited
McKesson Information Solutions (Netherlands) B.V.
McKesson Information Solutions UK Limited
McKesson International Capital S.a.r.l.
McKesson (International) (Gibraltar) Limited
McKesson International Finance S.a.r.l.
McKesson International Holdings II S.a.r.l.
McKesson International Holdings III S.a.r.l.
McKesson International Holdings Limited
McKesson International Holdings S.a.r.l.
McKesson International Holdings SRL
McKesson International S.a.r.l.
McKesson International SRL
McKesson International Ireland Limited
McKesson International LLC
McKesson International Nova Scotia ULC
McKesson Medical-Surgical FDT Inc.
McKesson Medical-Surgical Holdings Inc.
McKesson Medical-Surgical Inc.
McKesson Medical-Surgical Iowa Inc.
McKesson Medical-Surgical Iowa Supply Inc.
McKesson Medical-Surgical Maine Inc.
McKesson Medical-Surgical MediMart Inc.
McKesson Medical-Surgical MediNet Inc.
2
McKesson Medical-Surgical Minnesota Inc.
McKesson Medical-Surgical Minnesota Supply Inc.
McKesson Medical-Surgical TBC Inc.
McKesson Medication Management Holdings Inc.
McKesson Medication Management LLC
McKesson Medication Management Puerto Rico Inc.
McKesson New Zealand Limited
McKesson Property Company, Inc.
McKesson Services Inc.
McKesson Specialty Corporation
McKesson Specialty Pharmaceuticals LLC
McKesson Trading Company
McKesson Transportation Systems, Inc.
McKessonHBOC (Gibraltar) Limited
Medical Imaging SRL
Penn-Chem Corporation
Pharmaceutical Support Services, Inc.
Purchasing Alliance for Clinical Therapeutics, LLC
▇▇▇▇ Medical Services, Inc.
VPI Gezondheidszorg B.V.
Zee Medical Canada, Inc.
Zee Medical, Inc.
Part (b). Indebtedness in Excess of $25,000,000 Secured by Liens.
As of August 31, 2002, the Company and its Subsidiaries had an
outstanding debt of approximately $16,186,500 for borrowed money with respect to
the Company's headquarters building at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ (the "Building"). This constitutes 50% of the total amount
outstanding (approximately $32,373,000) under the mortgage on the Building. The
Company's wholly owned subsidiary, ▇▇▇▇▇▇▇ Plaza Company, owns an undivided 50%
interest in the property that is subject to the mortgage and, under the terms of
the mortgage documents, is liable for 50% of the mortgage debt. However, the
related Lien (securing the obligations of both ▇▇▇▇▇▇▇ Plaza Company and the
co-owner) attaches to the entire property and, as a result, the total amount
outstanding under the mortgage is "Indebtedness" of the Company and its
Subsidiaries pursuant to clause (h) of the definition of that term in this
Agreement, notwithstanding that neither the Company nor its Subsidiary is
obligated to pay the 50% portion of the mortgage debt that is owed by the
property's co-owner.
3
SCHEDULE 11.02
ADMINISTRATIVE AGENT'S OFFICE,
CERTAIN ADDRESSES FOR NOTICES
COMPANY:
McKesson Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
U.S.A.
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President and Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic mail: ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
Website address: ▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇
McKESSON CANADA:
McKesson Canada Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President Finance and Assistant Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic mail: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇
Website address: ▇▇▇.▇▇▇▇▇▇▇▇.▇▇
WITH A COPY OF ALL NOTICES TO:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President and Treasurer, McKesson Corporation (see
Company contact information above)
ADMINISTRATIVE AGENT:
Administrative Agent's Contact for Payments and Requests for Credit Extensions:
Bank of America, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
Mail Code: NC1-001-15-04
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Account No.: 1366212250600
Ref: McKesson Corp
ABA# ▇▇▇▇▇▇▇▇▇
1
Other Notices as Administrative Agent:
Bank of America, N.A.
Agency Management
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Code: CA5-701-05-19
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
CANADIAN ADMINISTRATIVE AGENT:
Canadian Administrative Agent's Office:
Bank of America, N.A., Canada Branch
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Contact for Payments and Requests for Credit Extensions:
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Other Notices as Canadian Administrative Agent:
Attn: ▇▇▇▇▇▇ Sales ▇▇ ▇▇▇▇▇▇▇, AVP
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Payment Instructions
Canadian Dollar
LVTS - Large Value Transaction System
Bank of America, N.A., Canada Branch
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
Attn: Agency Loans Admin.
Swift Code: ▇▇▇▇▇▇▇▇
Transit #: 01312-241 Account #: ▇▇▇▇▇▇▇▇
Ref: McKesson Canada
2
L/C ISSUER:
Wachovia Bank, National Association
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ 1183
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Loan Portfolio Analyst
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
WITH A COPY OF ALL NOTICES TO:
Wachovia Securities
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Portfolio Manager
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
3
EXHIBIT A
FORM OF COMMITTED LOAN NOTICE
Date: ___________, _____
To: Bank of America, N.A., as Administrative Agent
[Bank of America, N.A. (acting through its Canadian branch), Canadian
Administrative Agent]
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement, dated as of
September 30, 2002 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
therein being used herein as therein defined), among McKesson Corporation, a
Delaware corporation, McKesson Canada Corporation, an Ontario corporation, the
Lenders from time to time party thereto, Bank of America, N.A. (acting through
its Canadian branch), as Canadian Administrative Agent, Bank of America, N.A.,
as Administrative Agent, and Wachovia Bank, National Association, as L/C Issuer.
The undersigned hereby requests (select one):
[ ] A Borrowing of Committed Loans [ ] A conversion of Loans
[ ] A continuation of Loans
1. The Borrower is _________________________.
2. On_______________________________________(a Business Day).
3. In the amount of $_______________________.
4. Comprised of [Eurodollar Rate Loans] [Base Rate Loans]
[Canadian Prime Rate Loans]. [Type of Committed Loan
requested]
5. For Eurodollar Rate Loans: with an Interest Period of ______
months.
6. The Applicable Currency is [Dollars] [Canadian Dollars]
[The Borrowing requested herein complies with the proviso to the first
sentence of Section 2.01(a) of the Agreement and, if made with respect to
Canadian Loans, Section 2.01(b)(i) of the Agreement.]
[BORROWER]
By:___________________________________
Name:_________________________________
Title:________________________________
▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF NOTE
[DOMESTIC LOANS]
_______________
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises
to pay to _____________________ or registered assigns (the "Lender"), in
accordance with the provisions of the Agreement (as hereinafter defined), the
principal amount of each Loan from time to time made by the Lender to the
Borrower under that certain Credit Agreement, dated as of September 30, 2002 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the "Agreement;" the terms defined therein being used herein as
therein defined), among the Borrower, McKesson Canada Corporation, the Lenders
from time to time party thereto, Bank of America, N.A. (acting through its
Canadian branch), as Canadian Administrative Agent, Bank of America, N.A., as
Administrative Agent, and Wachovia Bank, National Association, as L/C Issuer.
The Borrower promises to pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount is paid in
full, at such interest rates and at such times as provided in the Agreement. All
payments of principal and interest shall be made to the Administrative Agent for
the account of the Lender in Dollars in immediately available funds at the
Administrative Agent's Office. If any amount is not paid in full when due
hereunder, such unpaid amount shall bear interest, to be paid upon demand, from
the due date thereof until the date of actual payment (and before as well as
after judgment) computed at the per annum rate set forth in the Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled
to the benefits thereof and may be prepaid in whole or in part subject to the
terms and conditions provided therein. Upon the occurrence and continuation of
one or more of the Events of Default specified in the Agreement, all amounts
then remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Agreement. Loans made by the
Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also attach
schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.
The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Note.
B-1-1
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF CALIFORNIA.
MCKESSON CORPORATION
By:_____________________________________
Name:___________________________________
Title:__________________________________
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF NOTE
[CANADIAN LOANS]
________________
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises
to pay to _____________________ or registered assigns (the "Lender"), in
accordance with the provisions of the Agreement (as hereinafter defined), the
principal amount of each Loan from time to time made by the Lender to the
Borrower under that certain Credit Agreement, dated as of September 30, 2002 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the "Agreement;" the terms defined therein being used herein as
therein defined), among the Borrower, McKesson Corporation, the Lenders from
time to time party thereto, Bank of America, N.A. (acting through its Canadian
branch), as Canadian Administrative Agent, Bank of America, N.A., as
Administrative Agent, and Wachovia Bank, National Association, as L/C Issuer.
The Borrower promises to pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount is paid in
full, at such interest rates and at such times as provided in the Agreement. All
payments of principal and interest shall be made to the Canadian Administrative
Agent for the account of the Lender in Canadian Dollars in immediately available
funds at the Canadian Administrative Agent's Office. If any amount is not paid
in full when due hereunder, such unpaid amount shall bear interest, to be paid
upon demand, from the due date thereof until the date of actual payment (and
before as well as after judgment) computed at the per annum rate set forth in
the Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled
to the benefits thereof and may be prepaid in whole or in part subject to the
terms and conditions provided therein. Upon the occurrence and continuation of
one or more of the Events of Default specified in the Agreement, all amounts
then remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Agreement. Loans made by the
Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also attach
schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.
The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Note.
B-2-1
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF CALIFORNIA.
MCKESSON CANADA CORPORATION
By:______________________________________
Name:____________________________________
Title:___________________________________
B-2-2
LOANS AND PAYMENTS WITH RESPECT THERETO
AMOUNT OF
PRINCIPAL OR OUTSTANDING
END OF INTEREST PRINCIPAL
TYPE OF AMOUNT OF INTEREST PAID THIS BALANCE NOTATION
DATE LOAN MADE LOAN MADE PERIOD DATE THIS DATE MADE BY
-------------------------------------------------------------------------------------------
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
_______ _________ _________ _______ ____________ ___________ ________
EXHIBIT C
OPINION MATTERS
Consistent with opinions under the Existing Agreements, the matters
contained in the following Sections of the Agreement should be covered by the
legal opinion:
- Section 5.01(a) and (b)
- Section 5.02
- Section 5.03
- Section 5.04
- Section 5.05
- Section 5.07
- Section 5.09
C-1
EXHIBIT D
FORM OF COMPLIANCE CERTIFICATE
Financial Statement Date:___________,
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of
September 30, 2002 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
therein being used herein as therein defined), among McKesson Corporation, a
Delaware corporation (the "Company"), McKesson Canada Corporation, an Ontario
corporation, the Lenders from time to time party thereto, Bank of America, N.A.
(acting through its Canadian branch), as Canadian Administrative Agent, Bank of
America, N.A., as Administrative Agent, and Wachovia Bank, National Association,
as L/C Issuer.
The undersigned Responsible Officer hereby certifies as of the date
hereof that he/she is the_______________________ of the Company, and that, as
such, he/she is authorized to execute and deliver this Certificate to the
Administrative Agent on the behalf of the Company, and that:
[Use following paragraph 1 for fiscal YEAR-END financial statements]
1. Attached hereto as Schedule 1 are the year-end audited
financial statements required by Section 6.01(a) of the Agreement for the fiscal
year of the Company ended as of the above date, together with the report and
opinion of an independent certified public accountant required by such section.
[Use following paragraph 1 for fiscal QUARTER-END financial statements]
1. Attached hereto as Schedule 1 are the unaudited financial
statements required by Section 6.01(b) of the Agreement for the fiscal quarter
of the Company ended as of the above date. Such financial statements fairly
present the financial condition, results of operations and cash flows of the
Company and its Subsidiaries in accordance with GAAP as at such date and for
such period, subject only to normal year-end audit adjustments and the absence
of footnotes.
2. The undersigned has reviewed and is familiar with the terms of
the Agreement and has made, or has caused to be made under his/her supervision,
a detailed review of the transactions and condition (financial or otherwise) of
the Company during the accounting period covered by the attached financial
statements.
3. A review of the activities of the Company during such fiscal
period has been made under the supervision of the undersigned with a view to
determining whether during such
D-1
fiscal period the Company performed and observed all its Obligations under the
Loan Documents, and
[SELECT ONE:]
[TO THE BEST KNOWLEDGE OF THE UNDERSIGNED DURING SUCH FISCAL PERIOD,
THE COMPANY PERFORMED AND OBSERVED EACH COVENANT AND CONDITION OF THE LOAN
DOCUMENTS APPLICABLE TO IT.]
--OR--
[THE FOLLOWING COVENANTS OR CONDITIONS HAVE NOT BEEN PERFORMED OR
OBSERVED AND THE FOLLOWING IS A LIST OF EACH SUCH DEFAULT AND ITS NATURE AND
STATUS:]
4. The representations and warranties of the Company contained in
Article V of the Agreement, or which are contained in any document furnished at
any time under or in connection with the Loan Documents, are true and correct on
and as of the date hereof, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct as of such earlier date, and except for purposes of this Compliance
Certificate, the representations and warranties contained in Section 5.08(a) of
the Agreement shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b) respectively, of Section 6.01 of the Agreement,
including the statements in connection with which the Compliance Certificate is
delivered.
5. The financial covenant analyses and information set forth on
Schedule 2 attached hereto are true and accurate on and as of the date of this
Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of____________, ____________.
MCKESSON CORPORATION
By: ______________________________
Name: ____________________________
Title: ___________________________
D-2
For the Quarter/Year ended ___________________("Statement Date")
SCHEDULE 2
to the Compliance Certificate
($ in 000's)
Section 7.04:
Maximum Total Debt to
Capitalization Ratio
1. Total Capitalization
(a) Total Debt $_________
(b) Capital stock and additional paid-in-capital $_________
(c) Retained earnings (accumulated deficits) $_________
(d) Sum of (a), (b) and (c): $_________
2. Ratio of Total Debt (Item 1(a)) to
Total Capitalization (Item 1(d)): _____:_____
3. Maximum Ratio Permitted under Section 7.04: 0.565:1.00
D-3
EXHIBIT E
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (this "Assignment and Assumption") is
dated as of the Effective Date set forth below and is entered into by and
between [Insert name of Assignor] (the "Assignor") and [Insert name of Assignee]
(the "Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (the "Credit
Agreement"), receipt of a copy of which is hereby acknowledged by the Assignee.
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Administrative Agent as contemplated below (i) all of the Assignor's rights
and obligations as a Lender under the Credit Agreement and any other documents
or instruments delivered pursuant thereto to the extent related to the amount
and percentage interest identified below of all of such outstanding rights and
obligations of the Assignor under the respective facilities identified below
(including, without limitation, Letters of Credit and Guarantees included in
such facilities) and (ii) to the extent permitted to be assigned under
applicable law, all claims, suits, causes of action and any other right of the
Assignor (in its capacity as a Lender) against any Person, whether known or
unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions
governed thereby or in any way based on or related to any of the foregoing,
including, but not limited to, contract claims, tort claims, malpractice claims,
statutory claims and all other claims at law or in equity related to the rights
and obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as, the "Assigned Interest"). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________ [and is an
Affiliate of [identify Lender]]
3. Borrower(s): McKesson Corporation and McKesson Canada Corporation
4. Administrative Agent: Bank of America, N.A., as the administrative
agent under the Credit Agreement
5. Credit Agreement: The Credit Agreement, dated as of September 30,
2002, among McKesson Corporation, McKesson Canada
Corporation, the Lenders parties thereto, Bank of
America, N.A., as Administrative Agent, Bank of
America, N.A. (acting through its Canadian
branch), as Canadian Administrative Agent,
Wachovia Bank, National Association, as L/C
Issuer and the other agents parties thereto
E-1
6. Assigned Interest:
Aggregate
Amount of Amount of Percentage
Commitment Commitment Assigned of
for all Lenders* Assigned* Commitment(1)
--------------- -------- -------------
$______________ $_________ ___________%
$______________ $_________ ___________%
$______________ $_________ ___________%
[7. Trade Date: __________________](2)
Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT
AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
--------
[NAME OF ASSIGNOR]
By: _____________________________
Title:
ASSIGNEE
--------
[NAME OF ASSIGNEE]
By: _____________________________
Title:
----------------------
* Amount to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.
(1) Set forth, to at least 9 decimals, as a percentage of the
Commitment of all Lenders thereunder.
(2) To be completed if the Assignor and the Assignee intend that the
minimum assignment amount is to be determined as of the Trade Date.
E-2
Consented to and Accepted:
Bank of America, N.A., as
Administrative Agent
By: _________________________________
Title:
Consented to:
McKesson Corporation
By: _________________________________
Title:
▇-▇
▇▇▇▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
CREDIT AGREEMENT
DATED AS OF SEPTEMBER 30, ▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ CORPORATION,
THE LENDERS PARTY THERETO, BANK OF AMERICA, N.A. (ACTING
THROUGH ITS CANADIAN BRANCH, AS CANADIAN ADMINISTRATIVE AGENT,
BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT, AND WACHOVIA BANK,
NATIONAL ASSOCIATION, AS L/C ISSUER
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1. Assignor. The Assignor (a) represents and warrants
that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Company, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by the Company, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a Lender thereunder and, to
the extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Section
6.01 thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Administrative Agent or any other Lender, and (v) if it is a
Foreign Lender, attached hereto is any documentation required to be delivered by
it pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the
1
Assignor or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, and (ii) it will perform
in accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.
2. Payments. From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned interest
(including payments of principal, interest, fees and other amounts) to the
Assignee whether such amounts have accrued prior to or on or after the Effective
Date. The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Administrative Agent for periods prior to the Effective Date or
with respect to the making of this assignment directly between themselves.
3. General Provisions. This Assignment and Assumption
shall be binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the State of California.
2
EXHIBIT F
DRAWING NOTICE
Pursuant to that certain Agreement, dated as of September 30, 2002 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the "Agreement;" the terms defined therein being used herein as
therein defined), among McKesson Corporation, a Delaware corporation, McKesson
Canada Corporation, an Ontario corporation, the Lenders from time to time party
thereto (the "Lenders"), Bank of America, N.A. (acting through its Canadian
branch), as Canadian Administrative Agent, Bank of America, N.A., as
Administrative Agent and Wachovia Bank, National Association, as L/C Issuer,
this represents McKesson Canada's notice pursuant to Section 2.04(b) of the
Agreement that McKesson Canada hereby requests a Drawing under the Agreement,
and, in connection therewith, sets forth below the information relating to such
Drawing as required by Section 2.04(b) of the Agreement:
1. The Drawing Date, which is a Business Day,
is __________, ____;
2. The aggregate Face Amount of Drafts to be
accepted is Cdn.$____________;
3. The maturity date for such Drafts is ______,
____, which represents a term to maturity of approximately
[Insert term of ▇▇▇▇ of exchange, which may be anywhere from 7
to 180] days.
Dated: _______________ McKESSON CANADA CORPORATION
By: __________________________
Name: ________________________
Title: _______________________
F-1