Exhibit (b)(1)
CONFORMED COPY
U.S. $4,000,000,000
RESTATED CREDIT AGREEMENT
dated as of
July 7, 2003
among
Alcan Inc.,
as Borrower and Guarantor
The Designated Subsidiaries
Referred to Herein,
as Borrowers
The Lenders Party Hereto
Royal Bank of Canada,
as Administrative Agent
and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited,
as Lead Tender Offer Guarantor
-----------------
Syndicated by:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding (Nova Scotia) Co.,
Citigroup Global Markets Inc.
and
RBC Capital Markets,
as Joint Lead Arrangers and Bookrunners
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding (Nova Scotia) Co.,
and
Citigroup Global Markets Inc.,
as Co-Syndication Agents
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions................................................................................... 1
SECTION 1.02. Accounting Terms and Determinations........................................................... 14
SECTION 1.03. Construction.................................................................................. 15
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend........................................................................... 15
SECTION 2.02. Notice of Borrowings.......................................................................... 15
SECTION 2.03. Notice to Lenders; Funding of Loans........................................................... 16
SECTION 2.04. Notes......................................................................................... 17
SECTION 2.05. Maturity of Loans............................................................................. 18
SECTION 2.06. Fees.......................................................................................... 18
SECTION 2.07. Interest Rates................................................................................ 18
SECTION 2.08. Compensation for Reserve Requirements......................................................... 19
SECTION 2.09. Method of Electing Types of Interest Rates and Interest Periods for Dollar-Denominated Loans.. 20
SECTION 2.10. Method of Electing Interest Periods for Alternative Currency Loans............................ 21
SECTION 2.11. Termination or Reduction of Commitments....................................................... 21
SECTION 2.12. Optional Prepayments.......................................................................... 22
SECTION 2.13. Mandatory Prepayments......................................................................... 22
SECTION 2.14. General Provisions as to Payments............................................................. 23
SECTION 2.15. Funding Losses................................................................................ 24
SECTION 2.16. Computation of Interest and Fees.............................................................. 24
SECTION 2.17. Judgment Currency............................................................................. 24
SECTION 2.18. Designated Subsidiaries....................................................................... 25
SECTION 2.19. Notice Provisions Relating to Reduction Events................................................ 26
SECTION 2.20. Escrow Account................................................................................ 26
ARTICLE 3
CONDITIONS
SECTION 3.01. Effective Date................................................................................ 26
SECTION 3.02. Initial TO Borrowing.......................................................................... 28
SECTION 3.03. Other TO Borrowings........................................................................... 29
SECTION 3.04. All Other Borrowings.......................................................................... 29
SECTION 3.05. First Borrowing by Each Designated Subsidiary................................................. 29
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power................................................................. 30
SECTION 4.02. Corporate and Governmental Authorization; No Contravention.................................... 30
SECTION 4.03. Binding Effect................................................................................ 31
SECTION 4.04. Financial Information......................................................................... 31
SECTION 4.05. Litigation.................................................................................... 32
SECTION 4.06. Compliance with Laws.......................................................................... 32
SECTION 4.07. No Regulatory Restrictions on Borrowing....................................................... 32
SECTION 4.08. Full Disclosure............................................................................... 32
SECTION 4.09. Subsidiary Guarantors......................................................................... 33
ARTICLE 5
COVENANTS
SECTION 5.01. Information................................................................................... 33
SECTION 5.02. Compliance with Laws.......................................................................... 34
SECTION 5.03. Debt to Capitalization........................................................................ 34
SECTION 5.04. Consolidations, Mergers and Sales of Assets................................................... 35
SECTION 5.05. Negative Pledge............................................................................... 36
SECTION 5.06. Pari Passu.................................................................................... 38
SECTION 5.07. Use of Proceeds............................................................................... 38
SECTION 5.08. The Tender Offer.............................................................................. 38
ARTICLE 6
DEFAULT
SECTION 6.01. Events of Default............................................................................. 40
SECTION 6.02. Notice of Default............................................................................. 41
ARTICLE 7
THE AGENTS, THE TENDER OFFER GUARANTORS AND CERTAIN INDEMNIFICATIONS
SECTION 7.01. Appointment and Authorization................................................................. 41
SECTION 7.02. Agents and Affiliates......................................................................... 42
SECTION 7.03. Action by Agents.............................................................................. 42
SECTION 7.04. Consultation with Experts..................................................................... 42
SECTION 7.05. Liability of Agents........................................................................... 42
SECTION 7.06. Indemnifications.............................................................................. 42
SECTION 7.07. Credit Decision............................................................................... 44
SECTION 7.08. Successor Agents.............................................................................. 44
SECTION 7.09. Agents' Fees.................................................................................. 44
SECTION 7.10. Tender Offer Guarantors....................................................................... 44
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ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair...................................... 45
SECTION 8.02. Illegality.................................................................................... 45
SECTION 8.03. Increased Cost and Reduced Return............................................................. 46
SECTION 8.04. Taxes......................................................................................... 47
SECTION 8.05. Replacement of Lender......................................................................... 49
SECTION 8.06. Substitution of Dollar-Denominated Loans for Affected Euro-Currency Loans..................... 50
ARTICLE 9
GUARANTY
SECTION 9.01. The Guaranty.................................................................................. 50
SECTION 9.02. Guaranty Unconditional........................................................................ 51
SECTION 9.03. Discharge Only Upon Payment in Full; Reinstatement in Certain Circumstances................... 51
SECTION 9.04. Waiver by Alcan............................................................................... 52
SECTION 9.05. Subrogation................................................................................... 52
SECTION 9.06. Stay of Acceleration.......................................................................... 52
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices....................................................................................... 52
SECTION 10.02. No Waivers.................................................................................... 53
SECTION 10.03. Expenses; Indemnification..................................................................... 53
SECTION 10.04. Set-offs...................................................................................... 54
SECTION 10.05. Amendments and Waivers........................................................................ 55
SECTION 10.06. Participations and Assignments................................................................ 56
SECTION 10.07. No Reliance on Margin Stock................................................................... 57
SECTION 10.08. Waiver of Jury Trial.......................................................................... 57
SECTION 10.09. Judicial Proceedings.......................................................................... 57
SECTION 10.10. Governing Law................................................................................. 58
SECTION 10.11. Counterparts; Integration..................................................................... 58
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SCHEDULES AND EXHIBITS
Commitment Schedule
Pricing Schedule
Exhibit A - Note
Exhibit B - Opinion of ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Legal Counsel and Corporate Secretary
of Alcan
Exhibit C - Opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, Special New York Counsel for
Alcan
Exhibit D - Election to Participate
Exhibit E - Election to Terminate
Exhibit F - Opinion of Counsel for a Designated Subsidiary
Exhibit G - Assignment and Assumption Agreement
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RESTATED CREDIT AGREEMENT
RESTATED CREDIT AGREEMENT dated as of July 7, 2003 among ALCAN INC.,
the DESIGNATED SUBSIDIARIES referred to herein, the LENDERS party hereto, ROYAL
BANK OF CANADA (successor to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding (Nova Scotia) Co.),
as Administrative Agent, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING (NOVA SCOTIA) CO., as
Arranger, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INTERNATIONAL LIMITED, as Lead Tender Offer
Guarantor.
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have
the following meanings:
"Accepted Target Securities" means the Target Securities declared in
the Result Notice as having been the subject of acceptances by the shareholders
or bondholders or other securities holders of the Target and which are to be
acquired by Alcan pursuant to the Tender Offer.
"Acquisition" means the acquisition by Alcan of Target Securities
representing more than 50% of the total share capital and voting rights in the
Target, calculated on a fully-diluted basis, pursuant to the Tender Offer.
"Administrative Agent" means Royal Bank of Canada (successor to ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Senior Funding (Nova Scotia) Co.), in its capacity as administrative
agent for the Lenders hereunder, and any successor in such capacity.
"Administrative Questionnaire" means, with respect to each Lender, an
administrative questionnaire in the form prepared by the Administrative Agent,
duly completed by such Lender and submitted to the Agent.
"Agents" means the Administrative Agent and the Arranger.
"Alcan" means Alcan Inc., a corporation organized under the laws of
Canada, and its successors.
"algroup" means Alcan Holdings Switzerland AG, a corporation organized
under the laws of Switzerland, and its successors.
"Alternative Currencies" means euros so long as (x) such currency is
freely transferable and is freely convertible into Dollars in the London foreign
exchange market and (y) deposits in such currency are customarily offered to
banks in the London interbank market.
"Alternative Currency Loan" means a Loan that is made in an Alternative
Currency in accordance with the applicable Notice of Borrowing.
"Applicable Lending Office" means, with respect to any Lender, (i) in
the case of its Base Rate Loans, its Base Rate Lending Office and (ii) in the
case of its Euro-Currency Loans, its Euro-Currency Lending Office.
"Arranger" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding (Nova Scotia) Co., in
its capacity as a Lead Arranger and Bookrunner.
"Assignee" has the meaning set forth in Section 10.06(c).
"Base Rate" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal
Funds Rate for such day.
"Base Rate Lending Office" means, as to each Lender, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Base Rate Lending Office) or such other
office as such Lender may hereafter designate as its Base Rate Lending Office by
notice to the Administrative Agent; provided that any Lender may from time to
time by notice to Alcan and the Administrative Agent designate separate Base
Rate Lending Offices for its Base Rate Loans to different Borrowers, in which
case all references herein to the Base Rate Lending Office of such Lender shall
be deemed to refer to any or all of such offices, as the context may require.
"Base Rate Loan" means a Loan that is outstanding as a Base Rate Loan
in accordance with the applicable Notice of Borrowing or an applicable Notice of
Interest Rate Election or pursuant to Article 8 or the last sentence of Section
2.09(a).
"Base Rate Margin" means the Euro-Currency Margin less 1.00%, if the
result is a positive number.
"Borrower" means Alcan or any Designated Subsidiary, as the context may
require.
"Borrowing" means an aggregation of Loans to be made by the Lenders to
the same Borrower pursuant to Section 2.01 on the same day, all of which Loans
(i) are made in the same currency, (ii) in the case of Loans denominated in
Dollars, are of the same Type (subject to Article 8) and (iii) except in the
case of Base Rate Loans, have the same initial Interest Period. Borrowings may
be classified and referred to by Type (e.g., a "Euro-Currency Borrowing").
"Canadian GAAP" means Canadian generally accepted accounting principles
as in effect from time to time, applied on a basis consistent (except for
changes concurred in by Alcan's chartered accountants) with the most recent
audited consolidated financial statements of Alcan and its Consolidated
Subsidiaries delivered to the Lenders.
"Change of Control" means that (i) any Person or group of Persons shall
have acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated
by the SEC under the Exchange Act, using the term "person" therein as defined
herein) of 40% or more of the outstanding shares of common stock of Alcan or
(ii) individuals who, as of the Effective Date, constitute the board of
directors of Alcan (the "Incumbent Directors") cease for any reason to
constitute at least a majority of Alcan's board of directors, provided that any
person becoming a director after the Effective Date whose election, or
nomination for election by Alcan's
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stockholders, is approved by a vote of at least a majority of the directors then
comprising the Incumbent Directors (other than an election or nomination of an
individual whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election or removal of directors of
Alcan) shall also be considered an Incumbent Director.
"CMF" means the French Conseil des Marches Financiers.
"COB" means the French Commission des Operations de Bourse.
"Combined Subsidiary Capitalization" means, at any time, the sum of (i)
Combined Subsidiary Indebtedness and (ii) the sum (without duplication) of the
Consolidated Net Worth of each member of the Combined Subsidiary Group, in each
case at such time.
"Combined Subsidiary Group" means, at any time, (i) Alcan Aluminum
Corporation, (ii) British Alcan Aluminium plc, (iii) Alcan Deutschland GmbH,
(iv) once it becomes a Subsidiary, the Target and (v) each Wholly-Owned
Subsidiary which at such time holds any of the Consolidated Indebtedness of
Alcan Aluminum Corporation, British Alcan Aluminium plc, Alcan Deutschland GmbH
or the Target.
"Combined Subsidiary Indebtedness" means, at any time, the sum of the
Consolidated Indebtedness of each member of the Combined Subsidiary Group,
determined at such time after eliminating any Indebtedness owed by one member of
the Combined Subsidiary Group (or its subsidiaries) to another member of the
Combined Subsidiary Group (or its subsidiaries).
"Commitment" means (i) with respect to any Lender listed on the
Commitment Schedule, the amount set forth opposite its name on the Commitment
Schedule under the column "Commitment", (ii) with respect to any Assignee, the
amount of the transferor Lender's Commitment assigned to such Assignee pursuant
to Section 10.06(c) and (iii) with respect to any Replacement Lender, the amount
of the replaced Lender's Commitment assumed by such Replacement Lender pursuant
to Section 8.05, in each case as such amount may be reduced from time to time
pursuant to Section 2.11 or changed as a result of an assignment pursuant to
Section 10.06(c) or the replacement of a Lender by one or more Replacement
Lenders pursuant to Section 8.05; and "Commitments" means any or all of the
foregoing, as the context may require; provided that the "Commitment" of any
Lender on any date shall be reduced by the aggregate amount of Counter-Indemnity
Payments made by such Lender on or prior to such date and as to which such
Lender has not been reimbursed by Alcan pursuant to Section 10.03 on or prior to
such date.
"Commitment Fee Rate" has the meaning set forth in the Pricing
Schedule.
"Commitment Schedule" means the Commitment Schedule attached hereto.
"Consolidated Capitalization" means, when used with respect to Alcan or
any Subsidiary, the sum of its Consolidated Indebtedness and its Consolidated
Net Worth.
"Consolidated Indebtedness" means, at any date, (i) when used with
respect to Alcan, all Indebtedness of Alcan and its Consolidated Subsidiaries,
determined on a consolidated basis, as of such date and (ii) when used with
respect to any Subsidiary, all Indebtedness (except
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Indebtedness owed to Alcan) of such Subsidiary and its consolidated
subsidiaries, determined on a consolidated basis as of such date. In each case
such Consolidated Indebtedness shall be quantified at the amount that would be
included in determining total liabilities as shown on the liability side of
either a consolidated balance sheet of Alcan and its Consolidated Subsidiaries
or a consolidated balance sheet of such Subsidiary and its consolidated
subsidiaries, as the case may be, if such a balance sheet were prepared in
accordance with Canadian GAAP as of such date (or, in the case of a Guarantee or
similar contingent obligation, on a balance sheet of the primary obligor
prepared in accordance with Canadian GAAP as of such date).
"Consolidated Net Worth" means, at any date, (i) when used with respect
to Alcan, the consolidated stockholders' equity of Alcan and its Consolidated
Subsidiaries (including minority interests and redeemable non-retractable
preference shares), computed and consolidated as of such date in accordance with
Canadian GAAP, and (ii) when used with respect to a Subsidiary, the consolidated
stockholders' equity of such Subsidiary and its consolidated subsidiaries
(including minority interests and redeemable non-retractable preference shares),
computed and consolidated as of such date in accordance with Canadian GAAP.
"Consolidated Subsidiary" means, at any date, any Subsidiary or other
entity the accounts of which would be consolidated with those of Alcan in its
consolidated financial statements if such statements were prepared as of such
date.
"Counter-Indemnity Payment" means any payment made by a Lender pursuant
to Section 7.06(b) or Section 7.06(c).
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Designated Subsidiary" means, at any time, a Subsidiary that
constitutes a "Designated Subsidiary" at such time as provided in Section 2.18.
"Dollar Amount" means, at any time:
(i) with respect to any Dollar-Denominated Loan or any
Consolidated Indebtedness denominated in Dollars, the principal amount
thereof then outstanding, and with respect to any Net Proceeds in
Dollars, the amount of such Net Proceeds;
(ii) with respect to any Alternative Currency Loan, the
principal amount thereof then outstanding in the relevant Alternative
Currency, converted to Dollars at the spot rate at which such
Alternative Currency is offered for sale against Dollars as shown on
Reuters page FX, WRLD at the relevant Rate Fixing Time; and
(iii) with respect to any Consolidated Indebtedness, any
judgment or order, or Net Proceeds, in each case denominated in a
currency other than Dollars, the principal amount or amount thereof
then outstanding in such currency, converted to Dollars at the spot
rate at which such currency is offered for sale against Dollars as
shown on Reuters page FX, WRLD at the relevant Rate Fixing Time.
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As used in this definition, "Rate Fixing Time" means (i) if a Dollar Amount is
being determined in connection with a Borrowing, prepayment or other action
requiring advance notice from a Borrower to the Administrative Agent hereunder,
a time determined by the Administrative Agent within a reasonable time after it
receives such notice and (ii) if a Dollar Amount is being determined in any
other connection, a time determined by the Administrative Agent on the day on
which the relevant action is to be taken or for which the relevant amount is to
be determined, as the case may be.
"Dollar-Denominated Loan" means a Loan that is made in Dollars in
accordance with the applicable Notice of Borrowing.
"Dollars" and the sign "$" mean lawful money of the United States.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to close.
"Eastern Time" means local time in the Eastern time zone of the United
States and Canada.
"Effective Date" means the first date on which all the conditions
specified in Section 3.01 are satisfied.
"Election to Participate" means an Election to Participate,
substantially in the form of Exhibit D hereto, designating a Subsidiary as a
Designated Subsidiary.
"Election to Terminate" means an Election to Terminate, substantially
in the form of Exhibit E hereto, terminating the status of a Subsidiary as a
Designated Subsidiary.
"Environmental Laws" means any and all laws, ordinances, rules and
regulations relating to the environment or the effect of the environment on
human health or to emissions, discharges or releases of pollutants,
contaminants, Hazardous Substances or wastes into the environment (including,
without limitation, ambient air, surface water, ground water or land) or
otherwise relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, Hazardous
Substances or wastes or the clean-up or other remediation thereof.
"ERISA" means the U.S. Employee Retirement Income Security Act of 1974
as amended, or any successor statute.
"Escrow Account" means an escrow account established by the
Administrative Agent on the books of the Administrative Agent and in the name of
Alcan, and subject to terms and conditions satisfactory to the Administrative
Agent and the Lead Tender Offer Guarantor.
"Euro-Currency Business Day" means a Euro-Dollar Business Day, unless
such term is used in connection with an Alternative Currency Borrowing or
Alternative Currency Loan, in each case for which funds are to be paid or made
available in an Alternative Currency on such day, in which case such day shall
not be a Euro-Currency Business Day unless commercial banks
5
are open for international business (including dealings in deposits in such
Alternative Currency) in both London and the place where such funds are to be
paid or made available.
"Euro-Currency Lending Office" means, as to each Lender, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Currency Lending Office) or such other office, branch or affiliate of such
Lender as it may hereafter designate as its Euro-Currency Lending Office by
notice to the Administrative Agent; provided that any Lender may from time to
time by notice to Alcan and the Administrative Agent designate separate
Euro-Currency Lending Offices for its Loans in different currencies and/or to
different Borrowers, in which case all references herein to the Euro-Currency
Lending Office of such Lender shall be deemed to refer to any or all of such
offices, as the context may require.
"Euro-Currency Loan" means a Loan that is either a Euro-Dollar Loan or
an Alternative Currency Loan.
"Euro-Currency Margin" has the meaning set forth in the Pricing
Schedule.
"Euro-Currency Reserve Percentage" means, for any day, that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion Dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Currency Loans is determined or any category of extensions of credit or
other assets which includes loans by a non-United States office of any Lender to
United States residents).
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
Dollar deposits) in London.
"Euro-Dollar Loan" means a Loan that is outstanding as a Euro-Dollar
Loan in accordance with the applicable Notice of Borrowing or an applicable
Notice of Interest Rate Election or the provisions of Section 8.02 or 8.06.
"euros" and the sign "E" mean the lawful currency of the member
states of the European Union that have adopted such single currency in
accordance with the Treaty establishing the European Community (signed in Rome
on March 25, 1957), as amended by the Treaty on European Union (signed in
Maastricht on February 7, 1992), and as further amended or supplemented from
time to time.
"Events of Default" has the meaning set forth in Section 6.01.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as
amended from time to time.
"Existing Multi-Year Facility" means Alcan's existing US$1,000,000,000
Credit Agreement dated as of December 10, 1996, as amended, and any refinancing
thereof on substantially similar terms.
6
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to Royal Bank of Canada on such day on such
transactions as determined by the Administrative Agent.
"Funding Date" means the first date on which all the conditions
specified in Section 3.02 are satisfied.
"Governmental Authority" means any governmental body, commission,
administrative agency or similar instrumentality of government.
"Group of Loans" means at any time a group of Loans consisting of (i)
all Loans to the same Borrower which are Base Rate Loans at such time or (ii)
all Euro-Currency Loans to the same Borrower which are in the same currency and
have the same Interest Period at such time; provided that, if a Euro-Currency
Loan of any particular Lender is converted to or made as a Dollar-Denominated
Loan pursuant to Section 8.02 or 8.06, such Loan shall be included in the same
Group or Groups of Loans from time to time as it would have been in if it had
not been so converted or made.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Indebtedness
of any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness (whether arising by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, to maintain financial statement conditions or otherwise) or (ii)
entered into for the purpose of assuring in any other manner the holder of such
Indebtedness of the payment thereof or to protect such holder against loss in
respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor" means Alcan or any Subsidiary Guarantor.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydrocarbons, or any substance having any constituent elements
displaying any of the foregoing characteristics.
"Indebtedness" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property, except trade accounts payable arising in the ordinary course
7
of business, (iv) all obligations of such Person as lessee which are capitalized
in accordance with Canadian GAAP and (v) all Guarantees by such Person of
obligations of another Person of the types described in clauses (i) to (iv)
inclusive of this definition.
"Indemnitee" has the meaning set forth in Section 10.03(b).
"Initial TO Borrowing" means the first TO Borrowing hereunder.
"Interest Period" means, with respect to each Euro-Currency Loan, a
period commencing on the date of borrowing specified in the applicable Notice of
Borrowing or on the date specified in an applicable Notice of Interest Rate
Election and ending one, two, three or six months thereafter, as the relevant
Borrower or the Administrative Agent may elect in the applicable notice;
provided that:
(i) any Interest Period (except an Interest Period
determined pursuant to clause (iii) below) which would otherwise end on
a day which is not a Euro-Currency Business Day for the relevant
currency shall be extended to the next succeeding Euro-Currency
Business Day for such currency unless such Euro-Currency Business Day
falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Currency Business Day for such
currency;
(ii) any Interest Period which begins on the last
Euro-Currency Business Day for the relevant currency in a calendar
month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall,
subject to clause (iii) below, end on the last Euro-Currency Business
Day for the relevant currency in a calendar month; and
(iii) any Interest Period which would otherwise end after
the Maturity Date shall end on the Maturity Date (or, if the Maturity
Date is not a Euro-Currency Business Day for the relevant currency, the
next preceding Euro-Currency Business Day for such currency).
"Lead Tender Offer Guarantor" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International
Limited, in its capacity as provider of the Tender Offer Guarantee.
"Lenders" means (i) each bank or financial institution listed on the
Commitment Schedule under the column "Lenders", (ii) each Assignee which becomes
a Lender pursuant to Section 10.06(c) and (iii) each Replacement Lender which
becomes a Lender pursuant to Section 8.05, and their respective successors.
"Lien" means, with respect to any asset, any mortgage, hypothec,
charge, pledge, security interest or other encumbrance of any kind, or any other
type of preferential arrangement that has the practical effect of creating a
security interest in respect of such asset. For the purposes of this Agreement,
Alcan or any Subsidiary shall be deemed to own subject to a Lien any asset which
it has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such asset.
8
"Loan" means a loan made by a Lender pursuant to Section 2.01(a);
provided that, if any such loan or loans (or portions thereof) are combined or
subdivided pursuant to a Notice of Interest Rate Election, the term "Loan" shall
refer to the combined principal amount resulting from such combination or to
each of the separate principal amounts resulting from such subdivision, as the
case may be.
"London Interbank Offered Rate" has the meaning set forth in Section
2.07(b).
"Mandate Letter" means the letter in respect of the Tender Offer
between Alcan and the Tender Offer Guarantors.
"Mandate Letter Indemnity" means the indemnity given by Alcan to the
Tender Offer Guarantors under the Mandate Letter pursuant to which Alcan agrees
to indemnify the Tender Offer Guarantors for all losses, costs, expenses and
liabilities relating to the Tender Offer, including without limitation any
payments made by any of them pursuant to the Tender Offer Guarantee and any
other liabilities relating thereto, as such indemnity agreement may be amended
from time to time.
"Margin Stock" has the meaning set forth in Regulation U of the Board
of Governors of the Federal Reserve System.
"Material Indebtedness" means Indebtedness (other than Indebtedness
under this Agreement) of Alcan or any Significant Subsidiary, arising in one or
more related or unrelated transactions, in an aggregate Dollar Amount exceeding
$50,000,000.
"Materially Adverse Effect" means any materially adverse change in the
business, results of operations or financial condition of Alcan and its
Subsidiaries taken as a whole.
"Maturity Date" means July 5, 2004.
"Net Proceeds" means, with respect to any event, (a) the cash proceeds
received in respect of such event (including any cash received in respect of any
non-cash proceeds, but only as and when received) in each case net of (b) the
sum of (i) all reasonable fees and out-of-pocket expenses paid by Alcan and its
Subsidiaries to third parties (other than affiliates) in connection with such
event, (ii) in the case of a sale, transfer or other disposition of an asset
(including pursuant to a sale and leaseback transaction), the amount of all
payments required to be made by Alcan and its Subsidiaries as a result of such
event to repay Indebtedness (other than Loans) secured by such asset or
otherwise subject to mandatory prepayment as a result of such event, and (iii)
the amount of all taxes paid (or reasonably estimated to be payable) by Alcan
and its Subsidiaries, and the amount of any reserves established by Alcan and
its Subsidiaries to fund contingent liabilities (including liabilities in
respect of indemnities, warranties and similar claims) reasonably estimated to
be payable, in each case during the year that such event occurred and the next
succeeding year and that are directly attributable to such event (as determined
reasonably and in good faith by the chief financial officer of Alcan).
"New York Office" means, at any time, the office of the Administrative
Agent in New York City specified in or pursuant to Section 10.01 at such time.
9
"Notes" means promissory notes of a Borrower, substantially in the form
of Exhibit A hereto, evidencing the obligation of such Borrower to repay the
Loans made to it.
"Notice of Borrowing" has the meaning set forth in Section 2.02.
"Notice of Interest Rate Election" means a notice by a Borrower
electing a type of interest rate and/or the duration of an Interest Period as
provided in Section 2.09(a) or 2.10.
"Parent" means, with respect to any Lender, any Person controlling such
Lender.
"Participant" has the meaning set forth in Section 10.06(b).
"Permitted Encumbrances" means:
(a) liens imposed by law for taxes that are not yet due or are
being contested in good faith by appropriate proceedings where the failure to
make payment pending such contest could not reasonably be expected to have a
Materially Adverse Effect;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the ordinary course
of business and securing obligations that are not overdue by more than 30 days
or are being contested in good faith by appropriate proceedings where the
failure to make payment pending such contest could not reasonably be expected to
have a Materially Adverse Effect;
(c) pledges and deposits made in the ordinary course of business
in compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business;
(e) judgment liens in respect of judgments that do not constitute
an Event of Default under Section 6.01(h); and
(f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of Alcan or any Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, the French
Republic (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the French Republic), in each case denominated in
euros and maturing within 180 days from the date of acquisition thereof.
10
"Person" means an individual, a corporation, a limited liability
company, a partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.
"Phase II Review" has the meaning set forth in Section 3.02(c).
"Pricing Schedule" means the Pricing Schedule attached hereto.
"Prime Rate" means the rate of interest publicly announced by Royal
Bank of Canada from time to time as its Prime Rate for Dollar loans in the
United States.
"Quarterly Payment Date" means each March 31, June 30, September 30 and
December 31.
"Receivables Securitization" means sales of accounts receivable of
Alcan or any of its Subsidiaries in connection with agreements for limited
recourse or non-recourse sales by Alcan or such Subsidiary for cash, provided
that (a) any such agreement is of a type and on terms customary for comparable
transactions in the good faith judgment of the Board of Directors of Alcan or
such Subsidiary, (b) such agreement does not create any interest in any asset
other than accounts receivable (and property securing or otherwise supporting
accounts receivable) and proceeds of the foregoing and (c) such agreement is
entered into in the ordinary course of business consistent with past practices
and pursuant to existing arrangements.
"Reduction Event" means:
(i) any sale, transfer or other disposition (including
pursuant to a sale and leaseback transaction) of any property of Alcan
or any Subsidiary, except (x) the disposition of assets located in
South Korea for aggregate consideration not to exceed $300,000,000 in a
sale-leaseback or other transaction (with a view to securing maximum
benefit from the fiscal attributes of Alcan Taihan Aluminum Limited,
the Subsidiary disposing of such assets), as contemplated, and
disclosed to the Agents and the Lenders, prior to the Effective Date,
and (y) dispositions of assets (other than securities) in the ordinary
course resulting in aggregate Net Proceeds not exceeding $2,500,000 for
any disposition transaction or $50,000,000 for all qualifying
dispositions during any fiscal year;
(ii) the issuance by Alcan or any Subsidiary of any equity
security, including without limitation any equity-linked security, or
the receipt by Alcan or any Subsidiary of any capital contribution,
except (x) any such issuance of any equity security to, or receipt of
any such capital contribution from, Alcan or any Subsidiary and (y) any
such issuance in connection with the exercise of employee stock
options; and
(iii) the incurrence by Alcan or any Subsidiary of any
Indebtedness, including without limitation pursuant to a public
offering, a private placement or a syndicated bank financing, except
(w) Indebtedness incurred under this Agreement, (x) Indebtedness
incurred under the Existing Multi-Year Facility to the extent that,
after giving effect to such Indebtedness and the application of the
proceeds thereof, the Dollar Amount of Indebtedness outstanding under
the Existing Multi-Year Facility does not exceed
11
$1,000,000,000, (y) Indebtedness incurred under the Renewed Facility to
the extent that, after giving effect to such Indebtedness and the
application of the proceeds thereof, the Dollar Amount of Indebtedness
outstanding under the Renewed Facility does not exceed $1,000,000,000
and (z) bilateral lines of credit and refinancings and renewals thereof
in the ordinary course of business in amounts not in excess of the
amounts available thereunder on the Effective Date.
"Reference Banks" means Citibank, N.A. and Royal Bank of Canada.
"Renewed Facility" means Alcan's $1,000,000,000 Credit Agreement dated
as of July 8, 2003, as amended, and any refinancing thereof on substantially
similar terms.
"Replacement Lender" means a bank or other institution (which may
include one or more of the Lenders) selected by Alcan with the approval of the
Administrative Agent (which shall not be unreasonably withheld) to replace a
Lender pursuant to Section 8.05.
"Required Lenders" means, at any time, Lenders having Commitments and
an aggregate Dollar Amount of outstanding Loans (without duplication) in an
aggregate amount equal to at least 66 2/3% of the Total Commitments and Dollar
Amount of outstanding Loans (without duplication) or, if all the Commitments
shall have terminated, Lenders holding at least 66 2/3% of the sum of the
aggregate Dollar Amounts of the outstanding Loans.
"Responsible Officer" means the Chairman, the President and Chief
Executive Officer, any Executive Vice President, the Chief Financial Officer,
the Treasurer, the Controller or any Assistant Treasurer of Alcan.
"Result Notice" means an announcement by the CMF published through
Euronext Paris of the final outcome of the Tender Offer (avis de resultat)
specifying the number of Target Securities tendered by the shareholders and
other securities holders of the Target which are to be acquired by Alcan
pursuant to the Tender Offer.
"SEC" means the U.S. Securities and Exchange Commission.
"Settlement Account" means an account of Euronext Paris confirmed by
Euronext Paris to the Lead Tender Offer Guarantor as being the account into
which the payment relating to the Accepted Target Securities is to be made.
"Settlement Date" means any date specified by the CMF in the Result
Notice as being the date on which the payment relating to the Accepted Target
Securities is to be made.
"Significant Subsidiary" means any Subsidiary which would meet the
definition of "significant subsidiary" contained as of the date hereof in
Regulation S-X of the SEC.
"Spot Conversion Rate" means, with respect to any conversion of an
Alternative Currency Loan to a Dollar-Denominated Loan, the Administrative
Agent's spot buying rate for the relevant Alternative Currency against Dollars
as of approximately 11:00 A.M. (London time) on the date of such conversion.
12
"Subsidiary" means any corporation or other entity of which securities
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by Alcan. On and after the date of (and after
giving effect to the) consummation of the Acquisition, each of the Target and
its subsidiaries shall be a "Subsidiary" for all purposes under this Agreement.
"Subsidiary Guarantor" means any Subsidiary which guarantees the
obligations of the Borrowers pursuant to Section 5.04(b).
"Subsidiary Guaranty Agreement" has the meaning set forth in Section
5.04(b).
"Target" means Pechiney, a societe anonyme organized under the laws of
France.
"Target Securities" means, collectively, (i) the shares of common
stock, par value E15.25 per share (the "Shares"), of the Target, (ii) the bonds
of the Target convertible into new Shares and/or exchangeable for existing
Shares, par value E75.25 per bond (obligations convertibles et/ou echangeables
en actions nouvelles ou existantes, or "OCEANEs"), (iii) the Bonus Allocation
Rights of the Target (10 of which are exchangeable for one Share) and (iv) the
American Depositary Shares of the Target, each representing one-half of one
Share.
"Tender Offer" means the tender offer for the Target Securities by
Alcan substantially on the terms described in the Tender Offer Documents.
"Tender Offer Documents" means, collectively, (i) the registration
statement on Form S-4 under the U.S. Securities Act of 1933 to be filed with the
SEC, (ii) the lettre de depot to be filed with the CMF together with certain
other documents, (iii) the Mandate Letter and (iv) the note d'information to be
filed with the COB, in each case relating to the tender offer for the Target
Securities by Alcan and substantially in the form of the drafts dated July 7,
2003 which were provided to the Arranger and as amended or modified thereafter
from time to time; provided that no amendment or waiver of a material term
(e.g., the form and amount of consideration or the terms of and conditions to
the Tender Offer) thereof shall be effective for purposes of this Agreement
unless consented to by the Required Lenders.
"Tender Offer Guarantee" means the guarantee given by the Tender Offer
Guarantors as required by the CMF in respect of the obligations of Alcan in
connection with the Tender Offer.
"Tender Offer Guarantors" means the Lead Tender Offer Guarantor and
each other financial institution that is designated as a "Tender Offer
Guarantor" under the Mandate Letter by Alcan and the Lead Tender Offer Guarantor
as to which notice of such designation has been received by the Agents from
Alcan or the Lead Tender Offer Guarantor.
"Term Period" means the period from and including the Funding Date to
but excluding the Maturity Date.
"TO Borrowing" means any Borrowing by Alcan to the extent the proceeds
thereof are applied to acquire Target Securities pursuant to the Acquisition.
13
"TO Termination Date" means the date on which the Tender Offer lapses
or terminates without the Funding Date having occurred, other than a lapse or
termination that meets the following conditions: (i) such lapse or termination
occurs either (x) on or before September 30, 2003 solely as the result of a
request by a competition or antitrust authority for a Phase II review of the
Acquisition (an "Antitrust Termination") or (y) on or before August 31, 2003
solely as the result of the revocation (annulation) of the avis de recevabilite
by the CMF for the Tender Offer or the revocation (annulation) by the COB of its
visa on the note d'information relating to the Tender Offer (a "Revocation");
(ii) within five Euro-Currency Business Days of such termination, Alcan provides
to the Lenders an information package including the terms and conditions of the
proposed refiled Tender Offer, projections reflecting the assets, liabilities,
revenues and cash flow of Alcan on a consolidated basis after giving effect to
the Acquisition as proposed to be consummated and a certification that (x) such
consummation will not have a material adverse effect on the business,
operations, property, condition (financial or otherwise) or prospects of Alcan
and its subsidiaries, in each case taken as a whole, or of the Target and its
subsidiaries, taken as a whole and (y) the representations and warranties
contained in this Agreement shall be true on and as of the date of the refiling
of the Tender Offer; (iii) within five Euro-Currency Business Days of receipt of
the information package, the Required Lenders shall not have determined that the
Commitments shall terminate; and (iv) Alcan shall refile the Tender Offer within
12 Euro-Currency Business Days after its lapse or termination (a lapse or
termination meeting all of the above conditions being referred to herein as a
"Permitted Termination"); provided that a second Antitrust Termination or a
second Revocation shall not be a Permitted Termination.
"Total Commitments", means, at any time, the aggregate amount of all
the Commitments (whether used or unused) at such time.
"Total Usage" means, at any time, the aggregate Dollar Amount of all
Loans then outstanding.
"Type" of Loan refers to whether such Loan is a Base Rate Loan or a
Euro-Dollar Loan, each of which shall be a separate "Type" of Loan.
"United States" and the abbreviations "U.S." and "U.S.A." mean the
United States of America.
"Western Europe" means the countries that are members of the European
Union plus Switzerland, Norway and Iceland.
"Wholly-Owned Subsidiary" means any Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by Alcan. Each
Consolidated Subsidiary of algroup shall be deemed to be a Wholly-Owned
Subsidiary so long as at least 99% of the outstanding shares of its capital
stock or other ownership interests are directly or indirectly owned by Alcan.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be
14
prepared in accordance with Canadian GAAP as in effect from time to time,
applied on a basis consistent (except for changes concurred in by Alcan's
chartered accountants) with the most recent audited consolidated financial
statements of Alcan and its Consolidated Subsidiaries delivered to the Lenders;
provided that, if Alcan notifies the Administrative Agent that Alcan wishes to
amend any provision of this Agreement to eliminate the effect of any change in
Canadian GAAP on the operation of such provision (or if the Administrative Agent
notifies Alcan that the Required Lenders wish to amend any provision hereof for
such purpose), then Alcan's compliance with such provision shall be determined
on the basis of Canadian GAAP in effect immediately before the relevant change
in Canadian GAAP became effective, until either such notice is withdrawn or such
provision is amended in a manner satisfactory to Alcan and the Required Lenders.
SECTION 1.03. Construction. (a) All references in this Agreement to
Sections, Articles, Schedules and Exhibits without further specification are to
Sections of, Articles of, Schedules to and Exhibits to this Agreement.
(b) The Table of Contents and the captions in this Agreement are
for convenience only and shall not in any way affect the meaning or construction
of any provision of this Agreement.
(c) Unless the context otherwise requires, "or" is not exclusive.
(d) Unless the context otherwise requires, "including" means
"including but not limited to".
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend. (a) Loans. Each Lender severally
agrees, on the terms and conditions set forth in this Agreement, to make one or
more loans to Alcan or any Designated Subsidiary pursuant to this subsection
from time to time during the Term Period, in an aggregate Dollar Amount not to
exceed such Lender's Commitment as in effect at such time. Each Borrowing shall
be made from the several Lenders ratably in proportion to their respective
Commitments. The Commitments are not revolving in nature, and Loans that are
prepaid or repaid may not be reborrowed. Loans may be used for the purposes set
forth in Section 5.07.
(b) Currency and Amount of Each Borrowing. Each Borrowing shall be
denominated in Dollars or an Alternative Currency. Each Borrowing shall be in an
aggregate Dollar Amount of $25,000,000 or any larger integral multiple of
$5,000,000; provided that any Borrowing may be in an aggregate Dollar Amount
equal to (i) the maximum aggregate Dollar Amount then available for borrowing
under the Commitments, or (ii) if such Borrowing is in an Alternative Currency,
an aggregate Dollar Amount permitted by the foregoing provisions of this
sentence reduced to the extent required so that the aggregate amount of such
Borrowing in such Alternative Currency is an integral multiple of 10,000,000
units thereof.
SECTION 2.02. Notice of Borrowings. The relevant Borrower shall give
the Administrative Agent notice (a "Notice of Borrowing") not later than 10:00
A.M. (Eastern Time)
15
on (i) the date of each Borrowing comprised of Base Rate Loans, (ii) the third
Euro-Dollar Business Day before each Borrowing comprised of Euro-Dollar Loans
and (iii) the fourth Euro-Currency Business Day before each Borrowing comprised
of Alternative Currency Loans, in each case specifying:
(a) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Borrowing comprised of Base Rate Loans or
a Euro-Currency Business Day for the relevant currency in the case of a
Borrowing comprised of Euro-Currency Loans (and which, in the case of
the Initial TO Borrowing, shall be the Settlement Date);
(b) the currency and aggregate amount (in such currency)
of such Borrowing (and which, in the case of the Initial TO Borrowing,
shall not exceed the cash consideration payable in relation to the
Accepted Target Securities less the amount on deposit on the Escrow
Account);
(c) if such Borrowing is comprised of Dollar-Denominated
Loans, the Type of such Loans; and
(d) in the case of a Borrowing comprised of Euro-Currency
Loans, the duration of the initial Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period.
In the case of the first Borrowing by each Borrower (other than Alcan), such
Borrower shall give the Administrative Agent one extra day's notice of such
Borrowing.
SECTION 2.03. Notice to Lenders; Funding of Loans. (a) Promptly after
receiving a Notice of Borrowing, the Administrative Agent shall notify each
Lender of the contents thereof (including the name of the Borrower) and of such
Lender's share of such Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the relevant Borrower.
(b) On the date of each Borrowing, each Lender shall:
(i) if such Borrowing is to be made in Dollars make
available its share of such Borrowing in Dollars, not later than 12:00
Noon (Eastern Time), in Federal or other funds immediately available in
New York City, to the Administrative Agent at its New York Office; or
(ii) if such Borrowing is to be made in an Alternative
Currency, make available its share of such Borrowing in such
Alternative Currency (in such funds as may then be customary for the
settlement of international transactions in such Alternative Currency)
to the account of the Administrative Agent at such time and place as
shall have been notified by the Administrative Agent to the Lenders by
at least four Euro-Currency Business Days' notice.
Unless the Administrative Agent determines that any applicable condition
specified in Article 3 has not been satisfied, the Administrative Agent shall
make the funds so received from the Lenders available to the relevant Borrower
at the aforesaid address or place; provided that, upon the receipt by the
Administrative Agent of a notice with the requisite information about the
16
Settlement Account from the Lead Tender Offer Guarantor, the funds so received
in respect of the Initial TO Borrowing shall be wired directly to the Settlement
Account.
(c) Unless the Administrative Agent shall have received notice
from a Lender before the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's share of such Borrowing (if
any), the Administrative Agent may assume that such Lender has made such share
available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (b) of this Section and the Administrative Agent may,
in reliance upon such assumption, make available to the relevant Borrower on
such date a corresponding amount. If and to the extent that such Lender shall
not have so made such share available to the Administrative Agent, such Lender
and such Borrower severally agree to repay to the Administrative Agent forthwith
on demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to such Borrower until the date such
amount is repaid to the Administrative Agent, at (i) if such amount is repaid by
such Borrower, a rate per annum equal to the higher of the Federal Funds Rate
and the interest rate applicable thereto pursuant to Section 2.07 and (ii) if
such amount is repaid by such Lender, the Federal Funds Rate (if such Borrowing
is in Dollars) or the applicable London Interbank Offered Rate (if such
Borrowing is in an Alternative Currency). If such Lender shall repay to the
Administrative Agent such corresponding amount, the relevant Borrower shall not
be required to repay such amount and the amount so repaid by such Lender shall
constitute such Lender's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.04. Notes. (a) The Loans of each Lender to each Borrower
shall be evidenced by a single Note of such Borrower payable to the order of
such Lender for the account of its Applicable Lending Office.
(b) Each Lender may, by notice to a Borrower and the
Administrative Agent, request that its Loans of a particular Type to such
Borrower be evidenced by a separate Note of such Borrower. Each such Note shall
be substantially in the form of Exhibit A hereto with appropriate modifications
to reflect the fact that it evidences solely Loans of the relevant Type;
provided that a Lender may request a different form of Note if such different
form is necessary or advisable for regulatory purposes. Each reference in this
Agreement to the "Note" or "Notes" of such Lender shall be deemed to refer to
and include any or all of such Notes, as the context may require.
(c) Promptly after receiving Notes from any Borrower pursuant to
Section 3.01(b) or 3.05(b), the Administrative Agent shall forward such Notes to
the Lenders. Each Lender shall record the date, currency, amount (in such
currency), Type and maturity of each Loan made by it to each Borrower and the
date and amount of each payment of principal made with respect thereto, and may,
if such Lender so elects in connection with any transfer or enforcement of any
of its Notes, endorse on the schedule forming a part thereof appropriate
notations to evidence the foregoing information with respect to each such Loan
to the relevant Borrower then outstanding; provided that the failure of any
Lender to make, or any error in making, any such recordation or endorsement
shall not affect the obligations of any Borrower hereunder or under the Notes.
Each Lender is hereby irrevocably authorized by each Borrower so to endorse its
Note of such Borrower and to attach to and make a part of such Note a
continuation of any such schedule as and when required.
17
SECTION 2.05. Maturity of Loans. Each Loan held by each Lender shall
mature, and the principal amount thereof shall be due and payable, on the
Maturity Date (or, if such date is not a Euro-Currency Business Day for the
relevant currency, the next preceding Euro-Currency Business Day for such
currency).
SECTION 2.06. Fees. (a) Alcan shall pay to the Administrative Agent,
for the account of each Lender, a commitment fee calculated for each day at the
Commitment Fee Rate for such day (determined in accordance with the Pricing
Schedule). Such commitment fee shall accrue for each day from and including the
Effective Date to but excluding the date on which the Commitments are terminated
on the amount of such Lender's unused Commitment in effect on such day.
(b) All fees payable pursuant to this Section 2.06 shall be
payable for the account of each Lender quarterly in arrears on each Quarterly
Payment Date, and on the date on which such Lender's Commitment terminates in
its entirety.
SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due or is converted to a different Type, at a
rate per annum equal to the sum of the Base Rate Margin (if any) plus the Base
Rate for such day. Such interest shall be payable quarterly in arrears on each
Quarterly Payment Date and, with respect to the principal amount of any Base
Rate Loan converted to a different Type, on the date such principal amount is so
converted. Any overdue principal of or interest on any Base Rate Loan shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the sum of 1% plus the Base Rate Margin (if any) applicable to such Loan plus
the Base Rate for such day.
(b) Each Euro-Currency Loan shall bear interest on the outstanding
principal amount thereof, for each Interest Period applicable thereto, at a rate
per annum equal to the sum of the Euro-Currency Margin plus the applicable
London Interbank Offered Rate. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, three months after the first day thereof.
The "London Interbank Offered Rate" applicable to any Interest Period
means (i) the rate shown on the Telerate page for the relevant currency (e.g.,
pages 3740 and 3750) and for a period of time comparable to such Interest Period
at approximately 11:00 A.M. (London time) two Euro-Currency Business Days before
the first day of such Interest Period or, if such rates are not available, (ii)
the average (rounded upward, if necessary, to the next higher 1/16 of 1%) of the
respective rates per annum at which deposits in the relevant currency are
offered to each of the Reference Banks in the London interbank market at
approximately 11:00 A.M. (London time) two Euro-Currency Business Days before
the first day of such Interest Period, in each case in an amount approximately
equal to the principal amount of the Euro-Currency Loan of such Reference Bank
to which such Interest Period is to apply and for a period of time comparable to
such Interest Period.
(c) Any overdue principal of or interest on any Euro-Currency Loan
shall bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the date of actual payment, at a rate
per annum equal to the rate determined in
18
accordance with Section 2.07(b), provided that the applicable London Interbank
Offered Rate referred to therein shall be the highest of (i) the London
Interbank Offered Rate applicable to such Loan immediately before it became
overdue, (ii) the London Interbank Offered Rate applicable to such Loan on each
day thereafter for such period of time not longer than three months as the
Administrative Agent may select and (iii) the quotient obtained (rounded upward
if necessary, to the next higher 1/100 of 1%) by dividing (x) the average
(rounded upward, if necessary, to the next higher 1/16 of 1%) of the respective
rates per annum at which one day (or, if such amount due remains unpaid more
than three Euro-Currency Business Days, then for such other period of time not
longer than three months as the Administrative Agent may select) deposits in the
relevant currency in an amount approximately equal to such overdue payment due
to each of the Reference Banks are offered to such Reference Bank in the London
interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Currency Reserve Percentage (or, if the circumstances
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per annum
equal to the sum of 1% plus the Base Rate Margin (if any) plus the Base Rate for
such day).
(d) The Administrative Agent shall determine each interest rate
applicable to the Loans hereunder. The Administrative Agent shall give prompt
notice to Alcan and the participating Lenders of each rate of interest so
determined, and its determination thereof shall be conclusive in the absence of
manifest error.
(e) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Administrative Agent as contemplated by this Section. If any
Reference Bank does not furnish a timely quotation, the Administrative Agent
shall determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Banks or, if none of
such quotations is available on a timely basis, the provisions of Section 8.01
shall apply.
SECTION 2.08. Compensation for Reserve Requirements. (a) If and so long
as a reserve requirement of the type described in the definition of
"Euro-Currency Reserve Percentage" is prescribed by the Board of Governors of
the Federal Reserve System (or any successor), each Lender subject to such
requirement may require each Borrower to pay, contemporaneously with each
payment of interest on each of such Lender's Euro-Currency Loans to such
Borrower, additional interest on such Euro-Currency Loan at a rate per annum
determined by such Lender up to but not exceeding the excess of (i) (A) the
applicable London Interbank Offered Rate divided by (B) one minus the
Euro-Currency Reserve Percentage over (ii) the applicable London Interbank
Offered Rate.
(b) Any Lender wishing to require payment of additional interest
pursuant to paragraph (a) of this Section 2.08 (i) shall so notify Alcan and the
Administrative Agent, in which case such additional interest on the relevant
Euro-Currency Loans of such Lender shall be payable to such Lender at the place
indicated in such notice with respect to each applicable Interest Period
commencing at least three Euro-Currency Business Days after the giving of such
notice and (ii) shall notify each Borrower, at least five Euro-Currency Business
Days before each date on which interest is payable on such Euro-Currency Loans
to such Borrower, of the additional amount then due to such Lender under this
Section.
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SECTION 2.09. Method of Electing Types of Interest Rates and Interest
Periods for Dollar-Denominated Loans. (a) Each Base Rate Loan and Euro-Dollar
Loan shall initially be of the Type specified by the relevant Borrower in the
applicable Notice of Borrowing. Thereafter, the relevant Borrower may from time
to time elect to change or continue the Type of each Group of Base Rate Loans or
Euro-Dollar Loans (subject to the provisions of Article 8), as follows:
(i) if such Loans are Base Rate Loans, the relevant
Borrower may elect to convert such Loans to Euro-Dollar Loans as of any
Euro-Dollar Business Day;
(ii) if such Loans are Euro-Dollar Loans, the relevant
Borrower may elect to convert such Loans to Base Rate Loans or elect to
continue such Loans as Euro-Dollar Loans for an additional Interest
Period, subject to Section 2.15 in the case of any such conversion on
any day other than the last day of an Interest Period applicable to
such Euro-Dollar Loans.
Each such election shall be made by delivering a notice to the Administrative
Agent not later than 10:00 A.M. (Eastern Time) on the third Euro-Dollar Business
Day before the conversion or continuation selected in such notice is to be
effective. Such notice may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that (i)
such portion is allocated ratably among the Loans comprising such Group and (ii)
the Dollar Amount of the portion to which such notice applies, and the remaining
portion to which it does not apply, are each at least $50,000,000. If no such
notice is timely received before the end of an Interest Period for a Group of
Euro-Dollar Loans, the relevant Borrower shall be deemed to have elected that
such Group of Loans be converted to Base Rate Loans at the end of such Interest
Period.
(b) Each Notice of Interest Rate Election delivered pursuant to
subsection (a) of this Section shall specify:
(i) the Group of Loans (or portion thereof) to which such
notice applies;
(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with the
applicable clause of subsection (a) above;
(iii) if all or any portion of the Loans comprising such
Group are to be converted, the Type of Loans to which they are to be
converted and if they are to be converted to Euro-Dollar Loans, the
duration of the initial Interest Period applicable thereto; and
(iv) if such Loans are to be continued as Euro-Dollar
Loans for an additional Interest Period, the duration of such
additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Promptly upon receiving a Notice of Interest Rate Election
with respect to any Loans pursuant to subsection (a) of this Section, the
Administrative Agent shall notify each
20
Lender of the contents thereof and such notice shall not thereafter be revocable
by the relevant Borrower.
SECTION 2.10. Method of Electing Interest Periods for Alternative
Currency Loans. The initial Interest Period for each Group of Alternative
Currency Loans shall be specified by the relevant Borrower in the applicable
Notice of Borrowing. The relevant Borrower may specify the duration of each
subsequent Interest Period applicable to such Group of Loans by delivering to
the Administrative Agent, not later that 10:00 A.M. (Eastern Time) on the fourth
Euro-Currency Business Day before the end of the immediately preceding Interest
Period, a notice specifying the Group of Loans to which such notice applies and
the duration of such subsequent Interest Period (which shall comply with the
provisions of the definition of Interest Period). Such notice may, if it so
specifies, apply to only a portion of the aggregate principal amount of the
relevant Group of Loans; provided that (i) such portion is allocated ratably
among the Loans comprising such Group and (ii) the Dollar Amount of the portion
to which such notice applies, and the remaining portion to which it does not
apply, are each at least $50,000,000. If no such Notice of Interest Rate
Election is timely received by the Administrative Agent, the relevant Borrower
shall be deemed to have elected that the subsequent Interest Period for such
Group of Loans shall have a duration of one month (subject to the provisions of
the definition of Interest Period).
SECTION 2.11. Termination or Reduction of Commitments. (a) Alcan may,
on at least three Domestic Business Days' notice to the Administrative Agent:
(i) terminate the unused Commitments at any time; or
(ii) ratably reduce from time to time, by an aggregate
amount of $25,000,000 or any larger multiple of $5,000,000, the
aggregate amount of the unused Commitments;
provided that Alcan may not reduce the Commitments on any date prior to the
Funding Date without the consent of the Tender Offer Guarantors unless
contemporaneously with any such reduction Alcan shall have deposited into the
Escrow Account an amount in euros equivalent (as reasonably determined by the
Administrative Agent) to the Dollar Amount of such reduction.
(b) (i) Each Lender's Commitment shall terminate on the
earlier of (x) the TO Termination Date and (y) the last Domestic Business Day of
the Term Period.
(ii) Upon the repayment or prepayment of the principal amount of
any Loan, such Lender's Commitment shall be automatically and permanently
reduced by an amount equal to the Dollar Amount of such repayment or prepayment.
Each such reduction shall be applied to reduce ratably the Commitments of the
several Lenders.
(iii) On any date prior to the Funding Date on which any Net
Proceeds are received by or on behalf of Alcan or any Subsidiary in respect of
any Reduction Event, the Commitments shall be automatically and permanently
reduced by an amount equal to the Dollar Amount of such Net Proceeds, and Alcan
or such Subsidiary shall immediately deposit such Net Proceeds in the Escrow
Account in accordance with Section 2.20.
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SECTION 2.12. Optional Prepayments. (a) Any Borrower may:
(i) upon at least one Domestic Business Day's notice to
the Administrative Agent, prepay any Group of Base Rate Loans, in whole
at any time, or from time to time in part in amounts aggregating
$25,000,000 or any larger multiple of $1,000,000; or
(ii) upon at least three Euro-Currency Business Days'
notice to the Administrative Agent, prepay any Group of Euro-Currency
Loans, in whole at any time, or from time to time in part; provided
that the aggregate Dollar Amount of any partial prepayment is at least
$25,000,000;
in each case, by paying (in the relevant currency) the principal amount to be
prepaid together with accrued interest thereon to the date of prepayment. Each
such optional prepayment shall be applied to prepay ratably the Loans of the
several Lenders included in the relevant Group of Loans. If any Group of
Euro-Currency Loans is prepaid on any day other than the last day of an Interest
Period applicable thereto, such Borrower shall comply with the provisions of
Section 2.15 in connection with such prepayment.
(b) Promptly after receiving a notice of prepayment pursuant to
this Section, the Administrative Agent shall notify each Lender of the contents
thereof and of such Lender's ratable share of such prepayment and such notice
shall not thereafter be revocable by the relevant Borrower.
SECTION 2.13. Mandatory Prepayments. (a) On each Quarterly Payment
Date, Alcan shall cause one or more Borrowers to prepay Loans to the extent (if
any) required so that on such Quarterly Payment Date, after giving effect to
such prepayments, the Total Usage does not exceed the Total Commitments.
(b) If on any day the Total Usage exceeds 105% of the Total
Commitments, the Administrative Agent shall notify Alcan and the Lenders that
Alcan is required to prepay Loans pursuant to this subsection. Within three
Euro-Dollar Business Days after receiving such notice, Alcan shall cause one or
more Borrowers to prepay Loans to the extent required so that, after giving
effect to such prepayments, the Total Usage does not exceed the Total
Commitments.
(c) If on or before the first day of any Interest Period
applicable to any Group of Alternative Currency Loans, there shall occur any
change in national or international financial, political or economic conditions
or currency exchange rates or exchange controls which in the opinion of the
Administrative Agent makes it impracticable for such Group of Loans to continue
to be denominated in the relevant Alternative Currency, the Administrative Agent
shall forthwith give notice thereof to Alcan and the Lenders, in which event
such Group of Loans shall be converted to Base Rate Loans at the Spot Conversion
Rate on the later of (i) the last day of the immediately preceding Interest
Period or (ii) the first Euro-Currency Business Day after the Administrative
Agent gives such notice to Alcan and the Lenders. If the date of such conversion
is determined pursuant to the foregoing clause (ii), such Group of Loans shall
bear interest, for each date from and including the last day of such immediately
preceding Interest Period to but excluding the date of such conversion, at a
rate per annum determined as provided in Section
22
2.07(c) (except that the 1% per annum additional interest applicable to overdue
amounts shall not apply).
(d) On any date on or after the Funding Date on which any Net
Proceeds are received by or on behalf of Alcan or any Subsidiary in respect of
any Reduction Event, one or more Borrowers shall prepay Loans in an aggregate
principal equal to the Dollar Amount of such Net Proceeds.
(e) On the date on which the Acquisition is consummated, any
amounts remaining in the Escrow Account after consummation will be applied to
prepay Loans.
(f) Each prepayment pursuant to subsection (a), (b), (d) or (e) of
this Section shall be made in accordance with the provisions of Section 2.12
relating to optional prepayments (and shall be applied to prepay such Groups of
Loans as the Borrowers shall designate or, absent such designation, as selected
by the Administrative Agent).
SECTION 2.14. General Provisions as to Payments. (a) Each payment of
principal of, and interest on, the Dollar-Denominated Loans and each payment of
fees hereunder, shall be made in Dollars not later than 12:00 Noon (Eastern
Time) on the date when due, in Federal or other funds immediately available in
New York City, to the Administrative Agent at its New York Office.
(b) Each payment of principal of, and interest on, the Alternative
Currency Loans shall be made in the relevant Alternative Currency in such funds
as may then be customary for the settlement of international transactions in
such Alternative Currency, for the account of the Administrative Agent at such
time and at such place as shall have been notified by the Administrative Agent
to Alcan and the Lenders by at least four Domestic Business Days' notice.
(c) Promptly upon receiving any payment for the account of the
Lenders, the Administrative Agent will distribute to each Lender, in the
currency and type of funds received by the Administrative Agent, such Lender's
ratable share of such payment.
(d) Whenever any payment of principal of, or interest on, the Base
Rate Loans or of fees shall be due on a day which is not a Domestic Business
Day, the date for payment thereof shall be extended to the next succeeding
Domestic Business Day. Whenever any payment of principal of, or interest on, the
Euro-Currency Loans shall be due on a day which is not a Euro-Currency Business
Day for the relevant currency, the date for payment thereof shall be extended to
the next succeeding Euro-Currency Business Day for such currency, unless (in the
case of Euro-Currency Loans only) such Euro-Currency Business Day falls in
another calendar month, in which case the date for payment thereof shall be the
next preceding Euro-Currency Business Day for such currency. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time. No extension (otherwise than by
operation of law) of any date of payment of any Loan pursuant to this subsection
shall extend such payment beyond the Maturity Date.
(e) Unless the Administrative Agent shall have received notice
from the relevant Borrower before the date on which any payment is due from such
Borrower to the Lenders hereunder that such Borrower will not make such payment
in full, the Administrative Agent may
23
assume that such Borrower has made such payment in full to the Administrative
Agent on such date and the Administrative Agent may, in reliance upon such
assumption, cause to be distributed to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent that such
Borrower shall not have so made such payment, each Lender shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent, at (i) the Federal Funds Rate (if such amount was
distributed in Dollars) or (ii) the rate per annum at which one day deposits in
the relevant currency are offered to the Administrative Agent in the London
interbank market for such day (if such amount was distributed in an Alternative
Currency).
SECTION 2.15. Funding Losses. If a Borrower makes any payment of
principal with respect to any Euro-Currency Loan (pursuant to Section 2.12 or
2.13, Article 6 or 8 or otherwise) on any day other than the last day of an
Interest Period applicable thereto or the last day of an applicable period fixed
pursuant to Section 2.07(c), or if a Borrower elects to convert Euro-Dollar
Loans to Base Rate Loans pursuant to Section 2.09(a)(ii) on any day other than
the last day of an Interest Period applicable to such Euro-Dollar Loans, or if a
Borrower fails to borrow or prepay any Euro-Currency Loans after notice of such
borrowing or prepayment has been given to any Lender in accordance with Section
2.03(a), 2.12(b) or 2.13(d), such Borrower shall reimburse each Lender within 15
days after demand for any resulting loss or expense incurred by it, including
(without limitation) any loss incurred in obtaining, liquidating or employing
deposits from third parties, but excluding loss of margin for the period after
any such payment or failure to borrow, provided that such Lender shall have
delivered to such Borrower a certificate as to the amount of such loss or
expense, which certificate shall be conclusive in the absence of manifest error.
SECTION 2.16. Computation of Interest and Fees. (a) Interest based on
the Prime Rate hereunder and interest on Loans in pounds sterling hereunder
shall be computed on the basis of a year of 365 days (or, in the case of the
Prime Rate, 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other interest
and fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
(b) For the purpose of the Interest Act (Canada) and disclosure
thereunder, whenever interest to be paid under this Agreement is to be
calculated on the basis of a year of 360 days or any other period of time that
is less than a calendar year, the yearly rate of interest to which the rate
determined pursuant to such calculation is equivalent is the rate so determined
multiplied by the actual number of days in the calendar year in which the same
is to be ascertained and divided by either 360 or such other period of time, as
the case may be.
SECTION 2.17. Judgment Currency. If for the purpose of obtaining
judgment in any court it is necessary to convert a sum due from any Borrower
hereunder or under any Note in the currency expressed to be payable herein (the
"specified currency") into another currency, the parties hereto agree, to the
fullest extent that they may effectively do so, that the rate of exchange used
shall be that at which in accordance with normal banking procedures the
Administrative Agent could purchase the specified currency with such other
currency at its New York Office on
24
the Euro-Currency Business Day preceding that on which final judgment is given.
The obligations of each Borrower in respect of any sum due to any Lender or the
Administrative Agent hereunder or under any Note shall, notwithstanding any
judgment in a currency other than the specified currency, be discharged only to
the extent that, on the Euro-Currency Business Day following receipt by such
Lender or the Administrative Agent (as the case may be) of any sum adjudged to
be so due in such other currency, such Lender or the Administrative Agent (as
the case may be) may in accordance with normal banking procedures purchase the
specified currency with such other currency. If the amount of the specified
currency so purchased is less than the sum originally due to such Lender or the
Administrative Agent, as the case may be, in the specified currency, the
relevant Borrower agrees, to the fullest extent that it may effectively do so,
as a separate obligation and notwithstanding any such judgment, to indemnify
such Lender or the Administrative Agent, as the case may be, against such loss,
and if the amount of the specified currency so purchased exceeds (a) the sum
originally due to any Lender or the Administrative Agent, as the case may be, in
the specified currency and (b) any amounts shared with other Lenders as a result
of allocations of such excess as a disproportionate payment to such Lender under
Section 10.04, such Lender or the Administrative Agent, as the case may be,
agrees to remit such excess to the relevant Borrower.
SECTION 2.18. Designated Subsidiaries. (a) Any Subsidiary shall
constitute a "Designated Subsidiary" for purposes of this Agreement if and so
long as:
(i) an Election to Participate designating such
Subsidiary as a Designated Subsidiary for purposes hereof shall have
been signed by Alcan and such Subsidiary and delivered to the
Administrative Agent;
(ii) such Subsidiary is a Wholly-Owned Subsidiary
organized under the laws of, and legally domiciled in, the United
States, Canada, the United Kingdom, Germany or Switzerland, or any
other country selected by Alcan with the consent of all the Lenders;
and
(iii) an Election to Terminate with respect to such
Subsidiary shall not have been delivered to the Administrative Agent.
When any Subsidiary becomes a Designated Subsidiary, the Administrative Agent
will promptly notify each Lender thereof.
(b) Alcan may elect to terminate the status of any Subsidiary as a
Designated Subsidiary by delivering to the Administrative Agent an Election to
Terminate with respect to such Subsidiary. The delivery of such Election to
Terminate shall not affect any obligation of such Subsidiary theretofore
incurred hereunder or any obligation of Alcan under Article 9. Promptly after
receiving any Election to Terminate, the Administrative Agent will notify each
Lender thereof.
(c) The status of any Subsidiary as a Designated Subsidiary shall
terminate immediately if, at any time, such Subsidiary shall (i) cease to be a
Subsidiary or a "subsidiary" within the meaning of the Canada Business
Corporations Act or (ii) commence a voluntary case or other proceeding, or an
involuntary case or other proceeding shall be commenced against such
25
Subsidiary, seeking liquidation, reorganization or other relief with respect to
it or its debts under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
its property, or such Subsidiary shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing, and, in the case of an involuntary case or other proceeding, such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 60 days, or an order for relief shall be entered against such
Subsidiary under any applicable bankruptcy, insolvency or other similar law now
or hereafter in effect. Within 90 days after the status of any Subsidiary as a
Designated Subsidiary terminates pursuant to this subsection, such Subsidiary
shall pay in full the unpaid principal of and interest on all outstanding Loans
to such Subsidiary, failing which Alcan shall forthwith pay in full all such
unpaid principal of and interest on all of such Subsidiary's outstanding Loans
pursuant to Alcan's guarantee thereof set forth in Article 9. Nothing in this
Section 2.18(c) shall limit or otherwise affect Alcan's obligations under
Article 9.
SECTION 2.19. Notice Provisions Relating to Reduction Events. Alcan
will notify the Administrative Agent of the proposed consummation of any
Reduction Event (and the corresponding reduction of the Commitments pursuant to
Section 2.11 or prepayment of the Loans pursuant to Section 2.13, as the case
may be) no later than 10:00 A.M. (Eastern Time) on the fifth Euro-Dollar
Business Day prior to the date of the proposed consummation thereof. Such notice
shall specify (i) the date of the proposed consummation of such Reduction Event,
(ii) a reasonably detailed calculation of the Net Proceeds thereof, and (iii)
the anticipated amount of the reduction of the Commitments or prepayment of the
Loans as a result thereof.
SECTION 2.20. Escrow Account. The following amounts shall be deposited
in the Escrow Account from time to time: (i) an amount in euros equivalent (as
reasonably determined by the Administrative Agent) to the Dollar Amount of the
Net Proceeds of any Reduction Event consummated prior to the Funding Date and
(ii) any amount to be deposited therein pursuant to the proviso to Section
2.11(a). The Administrative Agent will invest any amounts on deposit from time
to time in the Escrow Account for the account of the Borrowers and at the
direction of Alcan in Permitted Investments. The Borrowers shall have the right
to withdraw amounts on deposit in the Escrow Account from time to time, so long
as (x) the Borrowers shall have provided the Administrative Agent with at least
three prior Euro-Dollar Business Days' notice and (y) the Borrowers shall apply
such amounts immediately upon receipt thereof solely for the purchase of Target
Securities. After consummation of the Acquisition, all amounts on deposit in the
Escrow Account will be applied by the Administrative Agent first, to the
prepayment of any outstanding Loans pursuant to Section 2.13, and second, as
instructed by Alcan.
ARTICLE 3
CONDITIONS
SECTION 3.01. Effective Date. The "Effective Date" under this Agreement
shall occur on the first date on which each of the following conditions shall
have been satisfied:
26
(a) the Administrative Agent shall have received (i) from
each of the parties listed on the signature pages hereof either a
counterpart of this Agreement signed by such party or facsimile or
other written confirmation, in form satisfactory to the Administrative
Agent, that such party has signed a counterpart hereof and (ii) from
Alcan and the Lead Tender Offer Guarantor evidence satisfactory to the
Arranger that the filing of the lettre de depot relating to the Tender
Offer with the CMF shall occur on the Effective Date, substantially
simultaneously with or immediately after the effectiveness of this
Agreement;
(b) the Administrative Agent shall have received, for the
account of any Lender a duly executed Note of Alcan for the account of
such Lender, dated on or before the Effective Date and complying with
the provisions of Section 2.04;
(c) the Administrative Agent shall have received an
opinion of ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, a legal counsel and the Corporate Secretary
of Alcan, substantially in the form of Exhibit B hereto;
(d) the Administrative Agent shall have received an
opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, special New York counsel for Alcan,
substantially in the form of Exhibit C hereto;
(e) the structure of the Acquisition (including without
limitation the corporate, capital, organizational and tax structure
thereof, the plans and sources of funds for the refinancing of certain
existing Indebtedness of the Target and its subsidiaries that (x) could
become due and payable as a result of the consummation of the Tender
Offer, or (y) is otherwise not on terms and conditions acceptable to
the Arranger, and all the definitive documentation related thereto,
including the Tender Offer Documentation), will be in form and
substance satisfactory to the Arranger, and the Tender Offer
Documentation will be substantially in the form provided to the
Arranger prior to the Effective Date;
(f) there shall not have occurred or become known to the
Lenders any material adverse condition or material adverse change in or
affecting the business, operations, property, condition (financial or
otherwise) or prospects of Alcan and its Subsidiaries, taken as a
whole, or of the Target and its subsidiaries, taken as a whole;
(g) there shall be no pending or threatened litigation,
proceeding or investigation which (i) could reasonably be expected to
have a material adverse effect on the business, operations, property,
condition (financial or otherwise) or prospects of Alcan and its
Subsidiaries, taken as a whole, or of the Target and its subsidiaries,
taken as a whole, or (ii) in any manner calls into question or
challenges this Agreement or the making of the Loans hereunder;
(h) the Borrowers shall have paid (or made arrangements
satisfactory to the Arranger to pay, for value on the Effective Date)
in full all fees and expenses of the Agents, the Arranger, the Tender
Offer Guarantors and the Lenders payable on or prior to the Effective
Date; and
27
(i) the Administrative Agent shall have received such
other certificates, agreements and documents as the Arranger may have
reasonably requested relating to the existence of Alcan, the corporate
authority for and the validity of this Agreement and Alcan's Notes and
any other matters relevant to the Acquisition and the transactions
contemplated hereby, all in form and substance satisfactory to the
Arranger.
Upon the occurrence of the Effective Date, the Administrative Agent shall
promptly notify Alcan, the Lenders and the Lead Tender Offer Guarantor of such
fact, and such notice shall be conclusive and binding on all parties hereto.
SECTION 3.02. Initial TO Borrowing. The obligation of any Lender to
make a Loan on the occasion of the initial TO Borrowing is subject to the
satisfaction of the following conditions:
(a) the fact that the Effective Date shall have occurred
on or before July 9, 2003;
(b) receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.02 specifying the date of such
Borrowing as the date of consummation of the Tender Offer;
(c) Alcan shall have (i) obtained (1) evidence reasonably
satisfactory to the Arranger that (x) each of the European Commission,
the U.S. Department of Justice and the U.S. Federal Trade Commission
has decided not to initiate an investigation that extends beyond the
relevant initial period of investigation (a "Phase II Review") in
respect of the Acquisition under the European Merger Regulation or the
U.S. antitrust laws (or that the time limit for each such commission or
agency to do so has expired without such a decision) and (2) either
that there will not be a referral by the European Commission to any
competent authority of a member state or, if there is such a referral,
that the member state has decided not to refer the Acquisition to its
own competition authority, (ii) prior authorization of the Acquisition
from the French Ministry of Economy under the French foreign investment
legislation and (iii) delivered to the Administrative Agent a
certificate of a Responsible Officer certifying as to the matters set
forth in clauses (i) and (ii);
(d) (i) the Agents shall have received satisfactory
notification of the publication of the Result Notice, (ii) all of the
conditions to the Tender Offer (including, without limitation, the
minimum condition of the tender of Target Securities representing more
than 50% of the total share capital and voting rights in the Target,
calculated on a fully-diluted basis) shall have been satisfied, and the
Tender Offer shall be consummated, concurrently with the making of the
initial Loans hereunder, in accordance with the terms of the Tender
Offer Documents and (iii) Alcan shall have delivered to the
Administrative Agent a certificate of a Responsible Officer certifying
as to the matters set forth in clause (ii);
(e) the fact that, prior to the making of any Loans
pursuant to such Borrowing, Alcan shall have applied all amounts then
on deposit in the Escrow Account to purchase Target Securities pursuant
to the Tender Offer; and
28
(f) the Administrative Agent shall have received such
other certificates, agreements and documents as the Arranger may have
reasonably requested relating to the matters relevant to the
Acquisition and the transactions contemplated hereby, all in form and
substance satisfactory to the Arranger.
Upon the occurrence of the Funding Date, the Administrative Agent shall promptly
notify Alcan and the Lenders of such fact, and such notice shall be conclusive
and binding on all parties hereto.
SECTION 3.03. Other TO Borrowings. The obligation of any Lender to make
a Loan on the occasion of any TO Borrowing (other than the Initial TO Borrowing)
is subject to the satisfaction of the following conditions:
(a) the fact that the Effective Date shall have occurred
on or before July 9, 2003 and the Funding Date shall have occurred; and
(b) receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.02.
SECTION 3.04. All Other Borrowings. The obligation of any Lender to
make a Loan on the occasion of any Borrowing (other than any TO Borrowing) is
subject to the satisfaction of the following conditions:
(a) the fact that the Effective Date shall have occurred
on or before July 9, 2003; and the Funding Date shall have occurred;
(b) receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.02;
(c) the fact that, immediately before and after such
Borrowing, no Default shall have occurred and be continuing;
(d) the fact that the representations and warranties of
Alcan contained in this Agreement shall be true on and as of the date
of such Borrowing; and
(e) in the case of an Alternative Currency Borrowing,
there shall not have occurred any change in national or international
financial, political or economic conditions or currency exchange rates
or exchange controls which in the opinion of the Administrative Agent
makes it impracticable for such Borrowing to be denominated in the
relevant Alternative Currency.
Each Borrowing under this Section shall be deemed to be a representation and
warranty by Alcan on the date of such Borrowing as to the facts specified in
clauses (c) and (d) of this Section.
SECTION 3.05. First Borrowing by Each Designated Subsidiary. The
obligation of each Lender to make a Loan on the occasion of the first Borrowing
by each Designated Subsidiary are each subject to the satisfaction of the
conditions specified in Section 3.04 and receipt by the Administrative Agent of
the following:
29
(a) an Election to Participate signed by Alcan and such
Designated Subsidiary;
(b) a duly executed Note of such Designated Subsidiary
for the account of each Lender, dated on or before the date of such
Borrowing and complying with the provisions of Section 2.04;
(c) financial statements of such Designated Subsidiary of
the kind described in Section 5.01(c) for such Designated Subsidiary's
most recent fiscal year and fiscal quarter;
(d) an opinion of counsel for such Designated Subsidiary,
substantially in the form of Exhibit F hereto;
(e) an opinion of Canadian counsel for Alcan, in form and
substance satisfactory to the Agents, covering Alcan's corporate power
and authority to guarantee, and the validity and enforceability of
Alcan's guarantee pursuant to Article 9 of, all of the obligations of
such Designated Subsidiary under this Agreement, and such other matters
relating to such guarantee as the Administrative Agent may reasonably
request; and
(f) all documents which the Administrative Agent may
reasonably request relating to the existence of such Designated
Subsidiary, the corporate authority for and the validity of its
Election to Participate, this Agreement and its Notes, and any other
matters relevant thereto, all in form and substance satisfactory to the
Administrative Agent.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Alcan represents and warrants that:
SECTION 4.01. Corporate Existence and Power. (a) Alcan is a corporation
duly incorporated, validly existing and in good standing under the laws of
Canada, and has all corporate powers required to carry on its business as now
conducted.
(b) Each Significant Subsidiary is duly incorporated, validly
existing and in good standing under the laws of its jurisdiction of
incorporation. Each Designated Subsidiary is a Wholly-Owned Subsidiary.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. (a) The execution, delivery and performance by Alcan of this
Agreement, its Notes and each Election to Participate, and, as of the Effective
Date and the Funding Date, the purchase of Target Securities by Alcan pursuant
to the Tender Offer (either by payment of cash or issuance of securities of
Alcan), (i) are within Alcan's corporate powers, (ii) have been duly authorized
by all necessary corporate action, (iii) require no action by or in respect of,
or filing with, any Governmental Authority under any provision of law or
regulation applicable to Alcan (other than, with respect to the purchase of
Target Securities pursuant to the Tender Offer, either (x) such actions that
will
30
have been taken and filings that will have been made and shall be in full force
and effect as of the Funding Date or (y) such actions and filings the failure to
have taken or made which could not reasonably be expected to have a Materially
Adverse Effect or to affect Alcan's ability to perform its obligations under
this Agreement and its Notes), and (iv) do not contravene, or constitute a
default under, any provision of law or regulation applicable to Alcan or of its
articles or by-law or of any agreement, judgment, injunction, order, decree or
other instrument binding upon Alcan or any of its Subsidiaries or result in the
creation or imposition of any Lien on any asset of Alcan or any of its
Subsidiaries.
(b) The execution and delivery by each Designated Subsidiary of
its Election to Participate and its Notes, and the performance by it of this
Agreement and its Notes, (i) are within its corporate powers, (ii) have been
duly authorized by all necessary corporate action, (iii) require no action by or
in respect of, or filing with, any Governmental Authority under any provision of
law or regulation applicable to such Designated Subsidiary and (iv) do not
contravene, or constitute a default under, any provision of applicable law or
regulation or of its charter or by-laws or of any agreement, judgment,
injunction, order, decree or other instrument binding upon it or result in the
creation or imposition of any Lien on any of its assets.
SECTION 4.03. Binding Effect. (a) This Agreement constitutes a valid
and binding agreement of Alcan and each of its Notes and each Election to
Participate, when executed and delivered in accordance with this Agreement, will
constitute valid and binding obligations of Alcan, in each case enforceable in
accordance with its terms, subject to the limitations described in subsection
(c) of this Section.
(b) This Agreement constitutes a valid and binding agreement of
each Designated Subsidiary and its Notes, when executed and delivered in
accordance with this Agreement, will constitute valid and binding obligations of
such Designated Subsidiary, in each case enforceable in accordance with its
terms, subject to the limitations described in subsection (c) of this Section.
(c) The enforceability of this Agreement, any Subsidiary Guaranty
Agreement and the Notes in accordance with their respective terms may be limited
by bankruptcy, insolvency or similar laws affecting creditors' rights generally
and by general principles of equity. The enforceability thereof in Canada may be
limited by the Currency Act (Canada), which precludes Canadian courts from
awarding a judgment for an amount expressed in a currency other than Canadian
dollars, and to the extent that any requirement to pay interest at a greater
rate after default than before default may not be enforceable in Canada if the
same is construed by a Canadian court to constitute a penalty.
SECTION 4.04. Financial Information. (a) The consolidated balance sheet
of Alcan and its Consolidated Subsidiaries as of December 31, 2002 and the
related consolidated statements of income, retained earnings and cash flows for
the fiscal year then ended, reported on by PricewaterhouseCoopers LLP Chartered
Accountants and set forth in Alcan's 2002 Annual Report on Form 10-K as filed
with the SEC, a copy of which has been delivered to each of the Lenders, present
fairly, in all material respects, the consolidated financial position of Alcan
and its Consolidated Subsidiaries as of such date and their consolidated results
of operations and cash flows for such fiscal year, all in conformity with
Canadian GAAP.
31
(b) The unaudited interim consolidated balance sheet of Alcan and
its Consolidated Subsidiaries as of March 31, 2003 and the related unaudited
interim consolidated statements of income, retained earnings and cash flows for
the three months then ended, set forth in Alcan's quarterly report for the
fiscal quarter ended March 31, 2003 as filed with the SEC on Form 10-Q, a copy
of which has been delivered to each Lender, present fairly, in all material
respects, the consolidated financial position of Alcan and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
cash flows for such three-month period (subject to normal year-end adjustments),
all on a basis substantially consistent with the financial statements referred
to in subsection (a) of this Section.
(c) Since March 31, 2003 there has been no material adverse change
in the business, results of operations or financial condition of Alcan and its
Consolidated Subsidiaries, considered as a whole.
SECTION 4.05. Litigation. There is no action, suit or proceeding
pending against, or to the knowledge of Alcan threatened against or affecting,
Alcan or any of its Subsidiaries before any court, administrative agency,
arbitration panel or similar tribunal (i) in which there is a reasonable
possibility of an adverse decision which could reasonably be expected to have a
Materially Adverse Effect or (ii) in which any party other than an Agent or a
Lender draws into question the validity of this Agreement or any of the Notes.
SECTION 4.06. Compliance with Laws. Alcan and its Subsidiaries are in
compliance, in all material respects, with all applicable laws, ordinances,
rules and regulations of Governmental Authorities (including, without
limitation, Environmental Laws and ERISA), except where (i) the necessity of
compliance therewith is contested in good faith by appropriate proceedings or
(ii) noncompliance therewith, in the aggregate, could not reasonably be expected
to have a Materially Adverse Effect.
SECTION 4.07. No Regulatory Restrictions on Borrowing. Neither Alcan
nor any Designated Subsidiary is, or will be upon the consummation of any
acquisition, (i) an "investment company" within the meaning of the U.S.
Investment Company Act of 1940, as amended, (ii) a "holding company" within the
meaning of the U.S. Public Utility Holding Company Act of 1935, as amended, or
(iii) otherwise subject to any regulatory scheme which restricts its ability to
incur debt.
SECTION 4.08. Full Disclosure. The Information (as defined below)
furnished by Alcan, taken as a whole, did not, at the time it was furnished,
include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading (except for any
projections included therein, which projections provided reasonable estimations
of future performance for the periods covered thereby subject to the uncertainty
and approximation inherent in any projections and except to the extent later
Information could reasonably have been expected to supersede earlier
Information). As used in this Section, the term "Information" means (i) the
information set forth in Alcan's report on Form 10-K for its fiscal year ended
December 31, 2002 and in all subsequent reports on Forms 10-K, 10-Q and 8-K (or
their equivalents) which Alcan shall have filed with the SEC and (ii) all other
information furnished in writing to all the Lenders or to an Agent for
distribution to all the Lenders.
32
SECTION 4.09. Subsidiary Guarantors. If any Subsidiary becomes a
Subsidiary Guarantor pursuant to Section 5.04(b), (i) such Subsidiary Guarantor
will be a Wholly-Owned Subsidiary duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation, (ii) the
execution, delivery and performance by it of its Subsidiary Guaranty will be
within its corporate powers and will have been duly authorized by all necessary
corporate action, will not require any action by or in respect of, or filing
with, any Governmental Authority under any provision of law or regulation
applicable to such Subsidiary Guarantor, will not contravene, or constitute a
default under, any provision of law or regulation applicable to it or of its
charter or by-laws or of any agreement, judgment, injunction, order, decree or
other instrument binding upon it or result in the creation of any Lien on any of
its assets and (iii) its Subsidiary Guaranty Agreement will constitute a valid
and binding agreement of such Subsidiary Guarantor, enforceable in accordance
with its terms, subject to the limitations described in Section 4.03(c).
ARTICLE 5
COVENANTS
Alcan agrees that, so long as any Lender has any Commitment hereunder
or any principal of or interest on any Loan remains unpaid:
SECTION 5.01. Information. Alcan will deliver to each Lender:
(a) as soon as available and in any event within 90 days
after the end of each fiscal year of Alcan, a consolidated balance
sheet of Alcan and its Consolidated Subsidiaries as of the end of such
fiscal year and the related consolidated statements of income and cash
flows for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all reported on (in a
manner acceptable for filings with the SEC under the Exchange Act) by
PricewaterhouseCoopers LLP Chartered Accountants or other independent
chartered accountants of internationally recognized standing;
(b) as soon as available and in any event within 60 days
after the end of each of the first three quarters of each fiscal year
of Alcan, an unaudited consolidated balance sheet of Alcan and its
Consolidated Subsidiaries as of the end of such quarter and the related
unaudited consolidated statements of income and cash flows for such
quarter and for the portion of Alcan's fiscal year ended at the end of
such quarter, setting forth in the case of such income and cash flows
in comparative form the figures for the corresponding quarter and the
corresponding portion of Alcan's previous fiscal year, which may be in
the form of a press release, all certified (subject to normal year-end
adjustments) as to fairness of presentation and consistency with
Canadian GAAP by an authorized financial officer or accounting officer
of Alcan;
(c) if any Loan is outstanding to any Borrower (other
than Alcan) at the end of any fiscal year, a consolidated balance sheet
of such Borrower and its consolidated subsidiaries as of the end of
such fiscal year and the related consolidated statements of income and
cash flows for such fiscal year, which financial statements may (at
Alcan's
33
election) be publicly available financial statements, statutory
financial statements or unaudited internal financial statements;
(d) simultaneously with the delivery of each set of
financial statements referred to in clauses (a) and (b) above, a
certificate of a duly authorized officer of Alcan (i) setting forth in
reasonable detail the calculations required to establish whether Alcan
was in compliance with the requirements of Sections 5.03 and 5.05 on
the date of such financial statements and (ii) stating whether any
Default exists on the date of such certificate and, if any Default then
exists, setting forth the details thereof and the action which Alcan is
taking or proposes to take with respect thereto;
(e) within five days after any Responsible Officer of
Alcan obtains knowledge of any Default, if such Default is then
continuing, a certificate of a duly authorized officer of Alcan setting
forth the details thereof and the action which Alcan is taking or
proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders
of Alcan generally, copies of all financial statements, reports and
proxy statements so mailed;
(g) promptly after the filing thereof, a copy of each
report on Form 10-K, 10-Q or 8-K (or their equivalents) filed by Alcan
with the SEC; and
(h) from time to time such additional information
regarding the financial position or business of Alcan and its
Subsidiaries as the Administrative Agent, at the request of any Lender,
may reasonably request.
SECTION 5.02. Compliance with Laws. Alcan will comply, and cause each
Subsidiary to comply, in all material respects with all applicable laws,
ordinances, rules and regulations of Governmental Authorities (including,
without limitation, Environmental Laws, ERISA and laws and regulations
applicable to the Tender Offer), except where (i) the necessity of compliance
therewith is contested in good faith by appropriate proceedings or (ii)
noncompliance therewith, in the aggregate, could not reasonably be expected to
have a Materially Adverse Effect.
SECTION 5.03. Debt to Capitalization. (a) Alcan's Consolidated
Indebtedness will at all times be less than 55% of its Consolidated
Capitalization.
(b) Alcan will cause the Consolidated Indebtedness of each of the
following Subsidiaries at all times to be less than 55% of such Subsidiary's
Consolidated Capitalization:
(i) Alcan Aluminum Corporation (and, after the merger of
Alcan Aluminum Corporation into Alcan Corporation, Alcan Corporation),
(ii) British Alcan Aluminium plc,
(iii) Alcan Deutschland GmbH,
(iv) once it becomes a Subsidiary, the Target,
34
(v) any Subsidiary Guarantor, and
(vi) any Designated Subsidiary (except algroup or any of
its subsidiaries) not listed above, but only so long as such Designated
Subsidiary remains a Designated Subsidiary;
provided that, for purposes of this subsection (b), the Consolidated
Indebtedness of each of Alcan Aluminum Corporation (and, after the merger of
Alcan Aluminum Corporation into Alcan Corporation, Alcan Corporation), British
Alcan Aluminium plc, Alcan Deutschland GmbH and the Target shall exclude
Indebtedness owed to a Wholly-Owned Subsidiary of Alcan if and so long as
Combined Subsidiary Indebtedness is less than 55% of Combined Subsidiary
Capitalization.
SECTION 5.04. Consolidations, Mergers and Sales of Assets. (a) Alcan
will not consolidate, amalgamate or merge with or into any other Person;
provided that Alcan may merge with another Person if (i) Alcan is the
corporation surviving such merger and (ii) immediately after giving effect to
such merger, no Default shall have occurred and be continuing and all the
representations and warranties of Alcan contained in this Agreement shall be
true.
(b) Alcan will not, and will not permit its Subsidiaries to, sell,
lease or otherwise transfer, directly or indirectly, all or any substantial part
of the assets of Alcan and its Subsidiaries, taken as a whole, to any other
Person; provided that (i) any Subsidiary may transfer any or all of its assets
to Alcan or a Wholly-Owned Subsidiary at any time, (ii) Alcan may sell Margin
Stock to Persons that are not affiliates so long as any such sale is for fair
value, as determined in good faith by the board of directors of Alcan and (iii)
Alcan may transfer its assets to one or more of its Subsidiaries from time to
time; provided that, if the assets so transferred by Alcan are Material Assets
(as defined below), each transferee Subsidiary that receives all or any portion
of such Material Assets directly (or indirectly through one or more other
Subsidiaries) from Alcan shall be a Wholly-Owned Subsidiary and shall have
delivered to the Administrative Agent:
(x) in consideration of such transfer, a guaranty
agreement (a "Subsidiary Guaranty Agreement"), in form and substance
reasonably satisfactory to the Administrative Agent, pursuant to which
such Subsidiary shall guarantee the obligations of each Borrower under
this Agreement in substantially the same manner as Alcan guarantees the
obligations of each Designated Subsidiary in Article 9;
(y) an opinion of such Subsidiary's counsel, in form and
substance satisfactory to the Administrative Agent, with respect to the
due authorization, validity and enforceability of its Subsidiary
Guaranty Agreement and such other matters relating to the transactions
contemplated hereby as the Administrative Agent may reasonably request;
and
(z) all documents the Administrative Agent may reasonably
request relating to the existence of such Subsidiary, the corporate
authority for and the validity of its Subsidiary Guaranty Agreement and
any other matters relevant thereto, all in form and substance
satisfactory to the Administrative Agent.
35
For purposes of this Section, the following terms have the following
meanings:
"Material Assets" means (i) any capital stock of
Alcan Aluminum Corporation (and, after the merger of Alcan
Aluminum Corporation into Alcan Corporation, Alcan
Corporation), British Alcan Aluminium plc, Alcan Deutschland
GmbH, the Target or algroup, (ii) any smelter, (iii) any
electric generating facility constituting the primary source
of power for any Principal Property or (iv) any other asset
that Alcan determines in good faith to be of material
importance to the business conducted by it.
"Principal Property" means any mineral property,
smelter, refinery, mill, fabricating plant or similar
processing or manufacturing facility, or any electric
generating plant constituting the primary source of power for
any such facility, located in the United States, Canada or
Western Europe, of Alcan or any Subsidiary, and having a net
book value on the date as of which determination is being made
of more than 0.5% of Consolidated Net Tangible Assets as of
such date.
"Consolidated Net Tangible Assets" means (x) the
aggregate of all assets, including assets leased under capital
lease obligations, (less depreciation, obsolescence,
amortization, valuation and other proper reserves) which in
accordance with Canadian GAAP would appear on the asset side
of a consolidated balance sheet of Alcan and its Consolidated
Subsidiaries as of the end of the fiscal quarter immediately
preceding the date on which Consolidated Net Tangible Assets
are to be determined, after eliminating franchises, licenses,
permits, patents, patent applications, copyrights, trade
names, goodwill, organizational expenses, and other like
intangibles, unamortized debt discount and expense, less (y)
the aggregate of all consolidated current liabilities which
would appear on the liability side of such balance sheet, all
as determined in accordance with Canadian GAAP.
SECTION 5.05. Negative Pledge . (a) Alcan will not, and will not permit
any Subsidiary to, create or assume any Lien on any of its assets; excluding,
however, from the operation of this Section:
(i) the creation or assumption of any Purchase Money
Mortgage; provided that, immediately after giving effect to the
creation or assumption thereof, the aggregate outstanding principal
amount secured by all Purchase Money Mortgages shall not exceed 5% of
Consolidated Net Worth as shown on a consolidated balance sheet of
Alcan and its Consolidated Subsidiaries as of a date not more than 135
days prior to such time;
(ii) any Lien securing Indebtedness of any Subsidiary to
Alcan or to any other Subsidiary so long as the same shall be held by
or for the benefit of Alcan or a Subsidiary; provided that any transfer
or assignment of such Lien, or of the Indebtedness secured thereby, by
Alcan or such other Subsidiary to a Person other than Alcan or a
Subsidiary shall be deemed to be the creation at that time of a Lien
securing Indebtedness held by or for the benefit of such other Person;
36
(iii) Liens existing on property or assets of a corporation
or other Person that becomes a Subsidiary after the date hereof prior
to the time such corporation or other Person becomes a Subsidiary;
provided that (x) such Liens are not created in contemplation of or in
connection with such Person becoming a Subsidiary, (y) such Liens shall
not apply to any other property or assets of Alcan or any Subsidiary
and (z) such Liens shall secure only those obligations which it secures
on the date such Person becomes a Subsidiary;
(iv) any Lien in favor of the United States or Canada or
any State or Province thereof, or any department, agency, or
instrumentality or political subdivision thereof, to secure partial
progress, advance or other payments, or other obligations, pursuant to
any contract or statute or to secure any Indebtedness or obligations
incurred for the purpose of financing all or any part of the cost of
acquiring, constructing or improving the property subject to such Lien
(including any Lien incurred in connection with pollution control,
industrial revenue or similar financings);
(v) the sale or other transfer of any minerals in place
for a period of time until, or in an amount such that, the purchaser
will realize therefrom a specified amount of money (however determined)
or a specified amount of such minerals, or any other interest in
property of the character commonly referred to as a "production
payment," "mineral payment" or "ore payment", unless Alcan or a
Subsidiary has personally assumed or becomes generally liable for any
Indebtedness in connection with such sale or transfer;
(vi) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien
authorized under this Section 5.05; provided that the aggregate
principal amount or commutation value, as the case may be, secured
thereby does not exceed that of the obligations then outstanding to be
refunded;
(vii) Liens on Margin Stock, to the extent that the value
of all Margin Stock of Alcan and its Subsidiaries subject to the
provisions of this Section 5.05 exceeds 25% of the value of the total
assets of Alcan and its Subsidiaries subject to the provisions of this
Section 5.05;
(viii) Permitted Encumbrances;
(ix) Liens on accounts receivable (and in property
securing or otherwise supporting such accounts receivable together with
proceeds thereof) of Alcan and its Subsidiaries in connection with a
Receivables Securitization; provided that the aggregate of any amounts
received in such Receivables Securitization shall not at any time
exceed $300,000,000;
(x) Liens previously granted by Alcan and a Subsidiary in
the aggregate 40% undivided ownership interest held by Alcan and such
Subsidiary in the Alouette aluminum smelter in Quebec, such Liens
having been granted on a reciprocal basis for the benefit of the other
owners of interests in the Alouette smelter to secure the performance
of certain obligations of Alcan and such Subsidiary to such other
owners;
37
(xi) Liens on assets located in South Korea and disposed
of for aggregate consideration not to exceed $300,000,000 in a
transaction referred to in clause (i) of the definition of Reduction
Event; and
(xii) Liens not otherwise permitted by the foregoing
clauses of this Section securing Indebtedness and other obligations in
an aggregate principal and notional amount which, together with all
such Indebtedness and obligations permitted by clauses (i), (ii), (iii)
and (vi) of this Section, shall not exceed 5% of Consolidated Net Worth
as shown on a consolidated balance sheet of Alcan and its Consolidated
Subsidiaries as of a date not more than 135 days prior to such time.
(b) For purposes hereof, "Purchase Money Mortgage" means any Lien
upon property acquired, constructed or improved, or to be acquired, constructed
or improved, by Alcan or any Subsidiary and created prior to, contemporaneously
with, or within six months after, such acquisition or the completion of such
construction or improvement to secure the amount of the purchase price of such
property or the cost of such construction or improvement, or any part thereof,
or any Lien existing on such property at the time of the acquisition thereof,
whether the obligations secured thereby are payable to the Person from whom such
property is acquired or otherwise.
SECTION 5.06. Pari Passu. Alcan will ensure that no claims of the
Lenders or any Agent against any Borrower or Guarantor will be at any time
subordinate to the claims of other unsecured creditors of such Borrower or
Guarantor (except to the extent provided under bankruptcy, insolvency and other
similar laws of general application relating to or affecting the enforcement of
creditors' rights).
SECTION 5.07. Use of Proceeds. (a) The proceeds of the Loans will be
used by Alcan to acquire the Accepted Target Securities pursuant to the Tender
Offer, and by the Borrowers to refinance certain outstanding Indebtedness of the
Target; provided that proceeds of the first Borrowing shall be applied only to
acquire Accepted Target Securities pursuant to the Tender Offer.
(b) None of the proceeds of the Loans will be used, directly or
indirectly, for the purpose, whether immediate, incidental or ultimate, of
buying or carrying any Margin Stock, unless such use could not result in a
violation of Regulation U of the Board of Governors of the Federal Reserve
System.
SECTION 5.08. The Tender Offer. (a) Alcan shall not without the consent
of the Arranger (acting on the instructions of the Required Lenders) and the
Tender Offer Guarantors:
(i) increase (and shall ensure that nothing is done or
omitted by or on behalf of it or any of its Subsidiaries that would
require an increase in) the total cash consideration payable for the
Target Securities above the level set forth in the Tender Offer
Documents as in effect on the Effective Date; or
(ii) extend the Tender Offer or waive, amend, revise or
agree or decide not to enforce, in whole or in part, any other material
term of the Tender Offer or the Tender Offer Documents.
38
(b) Except for the description thereof contained in the Tender
Offer Documents on the Effective Date, Alcan shall not (and shall ensure that
none of its Subsidiaries shall) issue or allow to be issued on its behalf any
press release or other publicity which refers to this Agreement, the
Commitments, the Loans or any Agent or Lender without the consent of the
Arranger, unless the publicity is required by law, the COB, the CMF or any stock
exchange, in which case Alcan shall, to the extent possible in the
circumstances, notify the Arranger as soon as practicable upon becoming aware of
the requirement, shall consult with the Arranger on the terms of the reference
and shall have regard to any timely comments of the Arranger.
(c) Alcan shall keep the Agents and the Lenders informed as to the
status and progress of the Tender Offer and of all material communications with
the CMF, the COB, the SEC and any other French or U.S. authority relating to the
Tender Offer.
(d) Alcan shall promptly inform the Agents and the Lenders of any
material request for information from, or opening of a Phase II Review by, the
French or European competition authorities or the U.S. Department of Justice or
Federal Trade Commission.
(e) Alcan shall promptly inform the Arranger if in connection with
the Tender Offer, the acquisition of Target Securities by Alcan or any matter
arising therefrom:
(i) any material antitrust authorization: (A) is granted
or refused; or (B) could reasonably be expected not to be granted
before the Tender Offer closing date; or (C) is or could reasonably be
expected to be subject to any conditions and/or legally binding
assurances and/or undertakings which if satisfied could reasonably be
expected to have a Materially Adverse Effect; or
(ii) any legally binding assurances and/or undertakings by
or on behalf of Alcan or any of its Subsidiaries or the Target or any
of its subsidiaries are proposed, offered or given by or on behalf of
any such member in connection with any antitrust authorization;
and shall promptly disclose to the Agents such information as the Agents may
from time to time reasonably request in connection with, and the course of
action (if any) proposed to be taken by Alcan as a result of, any such event or
circumstance.
(f) Alcan shall promptly provide the Administrative Agent with
each legal opinion (other than any 10b-5 or similar disclosure opinion or
portion of an opinion) delivered by Alcan, or a representative or agent of or
counsel to Alcan, pursuant to the Tender Offer Documents (or any dealer manager
agreement relating to the Tender Offer) with a letter from each Person
delivering such opinion authorizing reliance thereon by the Agents and the
Lenders, such reliance letter to be in form and substance reasonably
satisfactory to the Arranger.
(g) If Target Securities representing more than 50% of the total
share capital and voting rights in the Target (on a fully-diluted basis) are
tendered in the Tender Offer, and all of the other conditions to the Tender
Offer have been satisfied (or waived, with the consent of the Required Lenders),
Alcan will accept such Target Securities and consummate the Tender Offer.
Promptly after the consummation of the Tender Offer, Alcan will use its
reasonable best efforts
39
to acquire Target Securities such that Alcan owns at least 95% of the total
share capital and voting rights in the Target.
ARTICLE 6
DEFAULT
SECTION 6.01. Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
(a) any Borrower shall fail to pay when due any principal
of or interest on any Loan, or any fee or other amount payable
hereunder, which failure, in the case of any amount other than
principal, continues for five Domestic Business Days;
(b) (i) Alcan shall fail to observe or perform any
covenant or agreement contained in Sections 5.03 through 5.08,
inclusive, or (ii) Alcan shall fail to observe or perform any covenant
or agreement contained in this Agreement (other than those covered by
clause (a) above or clause (b)(i)) for 30 days after written notice
thereof has been given to Alcan by the Administrative Agent at the
request of any Lender;
(c) any representation, warranty, certification or
statement made by Alcan in this Agreement or in any certificate,
financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect in any material respect
when made (or deemed made);
(d) one or more Guarantors or Significant Subsidiaries
shall fail to make one or more payments in respect of Material
Indebtedness when due or within any applicable grace period;
(e) any event or condition shall occur which results in
the acceleration of the maturity of Material Indebtedness of one or
more Guarantors or Significant Subsidiaries or enables (any applicable
grace period having expired) the holder or holders of such Material
Indebtedness, or any Person or Persons acting on their behalf, to
accelerate the maturity thereof;
(f) any Guarantor shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official
of it or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing;
(g) an involuntary case or other proceeding shall be
commenced against any Guarantor seeking liquidation, reorganization or
other relief with respect to it or its debts under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
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effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of 60 days; or an order
for relief shall be entered against any Guarantor under any applicable
bankruptcy, insolvency or other similar law as now or hereafter in
effect;
(h) a judgment or order for the payment of money in a
Dollar Amount in excess of $50,000,000 shall be rendered against any
Guarantor and such judgment or order shall continue unsatisfied and
unstayed for a period of 30 days;
(i) the guarantee by Alcan in Article 9 or the guarantee
by any Subsidiary Guarantor in its Subsidiary Guaranty Agreement shall
for any reason be revoked or invalidated, or otherwise cease to be in
full force and effect, or Alcan or any Subsidiary Guarantor (or any
Person on behalf of Alcan or any Subsidiary Guarantor) shall deny or
disaffirm its obligations under any such guarantee; or
(j) a Change of Control shall have occurred and, within
90 days thereafter, Alcan shall not have either (i) obtained a waiver
with respect to such Change of Control pursuant to Section 10.05 or
(ii) repaid all outstanding Loans and terminated all the Commitments
pursuant to Section 2.11;
then, and in every such event, the Administrative Agent shall (i) if requested
by Lenders having more than 50% in aggregate amount of the Commitments, by
notice to Alcan terminate all the Commitments and they shall thereupon
terminate, and (ii) if requested by Lenders holding more than 50% in aggregate
Dollar Amount of the Loans, by notice to Alcan declare the Loans (together with
accrued interest thereon) to be, and the Loans shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers; provided that (A)
in the case of any of the Events of Default specified in clause (f) or (g) above
with respect to any Guarantor, without any notice to Alcan or any other act by
the Administrative Agent or the Lenders, all the Commitments shall thereupon
terminate and the Loans (together with accrued interest thereon) shall become
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers and (B) the
Administrative Agent shall not have the right or obligation to take any of the
actions set forth in clauses (i) or (ii), and no Lender shall have the right to
request the Administrative Agent to do so, at any time prior to the occurrence
of the Funding Date.
SECTION 6.02. Notice of Default. The Administrative Agent shall give
notice to Alcan under Section 6.01(b)(ii) promptly upon being requested to do so
by any Lender and shall thereupon notify all the Lenders thereof.
ARTICLE 7
THE AGENTS, THE TENDER OFFER GUARANTORS AND CERTAIN INDEMNIFICATIONS
SECTION 7.01. Appointment and Authorization. Each Lender irrevocably
appoints and authorizes each Agent to take such action as agent on its behalf
and to exercise such powers
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under this Agreement and the Notes as are delegated to such Agent by the terms
hereof or thereof, together with all such powers as are reasonably incidental
thereto.
SECTION 7.02. Agents and Affiliates. Each Agent shall have the same
rights and powers under this Agreement as any other Lender and may exercise or
refrain from exercising the same as though it were not an Agent, and each Agent
and its affiliates may accept deposits from, lend money to, and generally engage
in any kind of business with Alcan or any Subsidiary or affiliate of Alcan as if
it were not an Agent hereunder.
SECTION 7.03. Action by Agents. The obligations of the Agents hereunder
are only those expressly set forth herein. Without limiting the generality of
the foregoing, the Agents shall not be required to take any action with respect
to any Default, except as expressly provided in Article 6 with respect to the
Administrative Agent.
SECTION 7.04. Consultation with Experts. Each Agent may consult with
legal counsel (who may be counsel for any Borrower), independent chartered
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agents. None of the Agents, their respective
affiliates and their respective directors, officers, agents or employees shall
be liable for any action taken or not taken by such Agent or affiliate in
connection herewith (i) with the consent or at the request of the Required
Lenders or (ii) in the absence of its own gross negligence or willful
misconduct. None of the Agents, their respective affiliates and their respective
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify (A) any statement, warranty or
representation made in connection with this Agreement or any borrowing
hereunder; (B) the performance or observance of any of Alcan's covenants or
agreements; (C) the satisfaction of any condition specified in Article 3, except
receipt of items required to be delivered to such Agent; or (D) the validity,
effectiveness or genuineness of this Agreement, the Notes or any other
instrument or writing furnished in connection herewith. No Agent shall incur any
liability by acting in reliance upon any notice, consent, certificate, statement
or other writing (which may be a bank wire, telex, facsimile transmission,
e-mail or similar communication) believed by it to be genuine or to be signed by
the proper party or parties.
SECTION 7.06. Indemnifications. (a) Each Lender shall, ratably in
accordance with the aggregate amount of its Commitments and outstanding
principal amount of Loans (without duplication), indemnify each Agent, and each
of their respective affiliates, directors, officers, agents and employees (to
the extent not reimbursed by any Borrower or Guarantor) against any cost,
expense (including counsel fees and disbursements), claim, demand, action, loss
or liability (except such as result from such indemnitee's gross negligence or
willful misconduct) that such indemnitee may suffer or incur in connection with
this Agreement or any action taken or omitted by such indemnitee hereunder; it
being understood that that no Lender shall have any obligation under this
Section 7.06(a) to indemnify any Tender Offer Guarantor for any matter covered
by Section 7.06(b).
(b) Each Lender shall, ratably in accordance with the aggregate
amount of its Commitment, indemnify promptly on demand each Tender Offer
Guarantor for any amount due
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and payable by Alcan to such Tender Offer Guarantor pursuant to the Mandate
Letter Indemnity and not so paid by Alcan, provided that its obligations under
this Section 7.06(b) shall not exceed the aggregate amount of its Commitment
(net, on any date, of the aggregate outstanding amount of its Loans on any such
date). Notwithstanding any other provisions of this Agreement, the obligations
of the Lenders under this Section are unconditional and irrevocable.
(c) If any Lender is not permitted (by its constitutional
documents or any applicable law) to comply with Section 7.06(b), then such
Lender shall not be required to comply with Section 7.06(b) and shall instead be
deemed to have taken, on the date the Tender Offer Guarantee is issued (or, if
later, on the date on which such Lender becomes a party to this Agreement), an
undivided interest and participation in the Tender Offer Guarantee (in
accordance with, and only to the extent of, its Commitment (net, on any date, of
the aggregate outstanding amount of its Loans on any such date)). On receipt of
a demand from the Lead Tender Offer Guarantor, such Lender shall promptly pay to
the Tender Offer Guarantors the amount specified under Section 7.06(b).
(d) The obligations of each Lender under Section 7.06(b) or (c)
shall be unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(i) any extension, waiver or consent granted by or to, or
agreement with, any Borrower, any Guarantor, the CMF, any Lender or any
other Person;
(ii) the release of any Borrower, any Guarantor, any
Lender or any other Person under the terms of any agreement or
arrangement with any creditor of such Person;
(iii) the taking, variation, compromise, exchange, renewal
or release of, or refusal or neglect to perfect, take up or enforce,
any rights against, or security over assets of, any Borrower, any
Guarantor, the CMF or any other Person or arising under the Tender
Offer Guarantee or any non-presentation or non-observance of any
formality or other requirement in respect of any instrument or any
failure to realize the full value of any security;
(iv) any incapacity or lack of power, authority or legal
personality of or dissolution or change in the members or status of any
Borrower, any Guarantor, the CMF, any Lender or any other Person;
(v) any amendment (however fundamental) or replacement or
extension of or increase in liabilities under or reopening or renewal
of the Tender Offer Guarantee (so that references in this Agreement to
the Tender Offer Guarantee shall include each such amendment or
replacement), this Agreement or any other document or security;
(vi) any unenforceability, illegality or invalidity of any
obligation of any Person under this Agreement, the Tender Offer
Guarantee or any other document or security; or
(vii) any insolvency or similar proceedings relating to any
Person.
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SECTION 7.07. Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon any syndication agent, Agent, other
Lender or Tender Offer Guarantor, and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender also acknowledges that it will, independently
and without reliance upon any syndication agent, Agent, other Lender or Tender
Offer Guarantor, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.08. Successor Agents. Any Agent may resign at any time by
giving notice thereof to the Lenders and Alcan. Upon the resignation of the
initial Administrative Agent, Alcan shall have the right, with the Arranger's
consent, to appoint a successor Administrative Agent. Upon any other such
resignation, the Required Lenders shall have the right, with Alcan's consent
(which shall not be unreasonably withheld), to appoint a successor Agent. If no
successor Agent shall have been so appointed, and shall have accepted such
appointment, within 30 days after the retiring Agent gives notice of
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be a commercial bank organized or licensed under
the laws of Canada or the United States (or any State thereof) and having a
combined capital and surplus of at least $100,000,000. Upon the acceptance of
its appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights and duties of
the retiring Agent, and the retiring Agent shall be discharged from its duties
and obligations hereunder. After any retiring Agent resigns as Agent hereunder,
the provisions of this Article shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was an Agent.
SECTION 7.09. Agents' Fees. Alcan shall pay to each Agent for its own
account fees in the amounts previously agreed upon between Alcan and such Agent.
SECTION 7.10. Tender Offer Guarantors. (a) Nothing in this Agreement
shall cause any Tender Offer Guarantor to become a trustee or fiduciary of any
other Person.
(b) Each Tender Offer Guarantor may accept deposits from, lend
money to, and generally engage in any kind of business with Alcan or any
Subsidiary or affiliate of Alcan as if it were not a Tender Offer Guarantor. No
Tender Offer Guarantor shall be bound to account to any Lender for any sum or
the profit element of any sum received by it for its own account.
(c) Each Tender Offer Guarantor may consult with legal counsel
(who may be counsel for any Borrower), independent chartered accountants and
other experts selected by it and shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the advice of such
counsel, accountants or experts. Each Tender Offer Guarantor may act in relation
to this Agreement through its personnel and agents.
(d) None of the Tender Offer Guarantors, their respective
affiliates and their respective directors, officers, agents or employees shall
be liable for any action taken or not taken by such Tender Offer Guarantor or
affiliate in connection herewith in the absence of its own gross negligence or
willful misconduct. None of the Tender Offer Guarantors, their respective
affiliates and their respective directors, officers, agents or employees shall
be
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responsible for or have any duty to ascertain, inquire into or verify (A) any
statement, warranty or representation made in connection with this Agreement or
(B) the validity, effectiveness or genuineness of this Agreement or any other
instrument or writing furnished in connection herewith. No Tender Offer
Guarantor shall incur any liability by acting in reliance upon any notice,
consent, certificate, statement or other writing (which may be a bank wire,
telex, facsimile transmission, e-mail or similar communication) believed by it
to be genuine or to be signed by the proper party or parties.
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair.
If on or before the first day of any Interest Period for any Euro-Currency Loan:
(a) the Administrative Agent is advised by the Reference
Banks that deposits in the applicable currency and amounts are not
being offered to such Reference Banks in the London interbank market
for such Interest Period, or
(b) in the case of Euro-Currency Loans, Lenders having at
least 50% in aggregate amount of the Commitments advise the
Administrative Agent that the London Interbank Offered Rate as
determined by the Administrative Agent will not adequately and fairly
reflect the cost to such Lenders of funding such Loans for such
Interest Period,
the Administrative Agent shall forthwith give notice thereof to Alcan and the
Lenders, whereupon until the Administrative Agent notifies Alcan that the
circumstances giving rise to such suspension no longer exist, (i) the
obligations of the Lenders to make Euro-Currency Loans in the affected currency
or to continue outstanding Euro-Currency Loans in such currency for an
additional Interest Period (or, if Dollars are affected, to convert outstanding
Base Rate Loans to Euro-Dollar Loans) shall be suspended and (ii) each
outstanding Euro-Currency Loan in such currency shall be converted to a Base
Rate Loan at the Spot Conversion Rate on the last day of the then current
Interest Period applicable thereto. Unless the relevant Borrower notifies the
Administrative Agent at least two Domestic Business Days before the date of any
Borrowing comprised of Euro-Currency Loans for which a Notice of Borrowing has
previously been given that it elects not to borrow such Borrowing on such date,
such Borrowing shall instead be made as a Borrowing comprised of Base Rate Loans
in the same aggregate Dollar Amount as the requested Borrowing.
SECTION 8.02. Illegality. If, on or after the date hereof, the adoption
of any applicable law, rule or regulation, or any change in any applicable law,
rule or regulation, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Lender
(or its Euro-Currency Lending Office) with any request or directive (whether or
not having the force of law) of any such authority, central bank or comparable
agency shall make it unlawful or impossible for any Lender (or its Euro-Currency
Lending Office) to make, maintain or fund its Euro-Currency Loans in any
currency to any Borrower and such Lender shall so notify the Administrative
Agent, the Administrative Agent shall forthwith give notice thereof to
45
the other Lenders and Alcan, whereupon until such Lender notifies Alcan and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Lender to make Euro-Currency Loans to such
Borrower in the affected currency or to continue outstanding Euro-Currency Loans
to such Borrower in such currency for an additional Interest Period (or, if
Dollars are affected, to convert outstanding Base Rate Loans to such Borrower to
Euro-Dollar Loans) shall be suspended. Before giving any notice to the
Administrative Agent pursuant to this Section, such Lender shall designate a
different Euro-Currency Lending Office if such designation will avoid the need
for giving such notice and will not, in the judgment of such Lender, be
disadvantageous to such Lender. If such notice is given, each of such Lender's
outstanding Euro-Currency Loans to such Borrower in such currency shall be
converted (at the Spot Conversion Rate in the case of each Alternative Currency
Loan) to a Base Rate Loan or, at the relevant Borrower's election, a Euro-Dollar
Loan either (a) on the last day of the then current Interest Period applicable
to such Euro-Currency Loan if such Lender may lawfully continue to maintain and
fund such Euro-Currency Loan to such day or (b) immediately if such Lender shall
determine that it may not lawfully continue to maintain and fund such
Euro-Currency Loan to such day. Interest and principal on any such Base Rate
Loan shall be payable contemporaneously with the related Euro-Currency Loans of
the other Lenders.
SECTION 8.03. Increased Cost and Reduced Return. (a) If, on or after
the date hereof, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any Governmental Authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
Governmental Authority, central bank or comparable agency shall impose, modify
or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System, but
excluding with respect to any Euro-Currency Loan any such requirement included
in an applicable Euro-Currency Reserve Percentage), special deposit, deposit
insurance assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender (or its Applicable Lending
Office) or shall impose on any Lender (or its Applicable Lending Office) or the
London interbank market any other condition affecting its Euro-Currency Loans,
any of its Notes or its obligation to make Euro-Currency Loans and the result of
any of the foregoing is to increase the cost to such Lender (or its Applicable
Lending Office) of making or maintaining any Euro-Currency Loan or to reduce the
amount of any sum received or receivable by such Lender (or its Applicable
Lending Office) under this Agreement or under any of its Notes with respect
thereto, by an amount deemed by such Lender to be material, then, within 15 days
after demand by such Lender (with a copy to the Administrative Agent), Alcan
shall pay, or cause the relevant Borrower to pay, to such Lender such additional
amount or amounts as will compensate such Lender for such increased cost or
reduction.
(b) If any Lender shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such Governmental Authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Lender (or its Parent) as a
46
consequence of its obligations hereunder to a level below that which such Lender
(or its Parent) could have achieved but for such adoption, change, request or
directive (taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Lender to be material, then from time to
time, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), Alcan shall pay to such Lender such additional amount or
amounts as will compensate such Lender (or its Parent) for such reduction.
(c) Each Lender will promptly notify Alcan and the Administrative
Agent of any event of which it has knowledge, occurring after the date hereof,
which will entitle it to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in its
judgment, be disadvantageous to it. A certificate of any Lender claiming
compensation under this Section 8.03(c) 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, such Lender may use any reasonable
averaging and attribution methods.
(d) If at any time any Subsidiary that is incorporated in, or
conducts business in, a jurisdiction outside the United States or Canada becomes
a Designated Subsidiary, all applicable laws, rules and regulations then in
effect in such jurisdiction shall be deemed for purposes of Section 8.03(a) to
have been adopted at such time and all applicable requests and directives
theretofore made by any Governmental Authority, central bank or comparable
agency in such jurisdiction shall be deemed for purposes of Section 8.03(a) to
have been made at such time; provided that no Lender shall be obligated under
Section 8.03(c) to give notice of any such law, rule, regulation, request or
directive, or to designate a different Applicable Lending Office by reason
thereof, until an officer of such Lender responsible for administering this
Agreement shall have become aware of such law, rule, regulation, request or
directive and the relevant consequences thereof.
SECTION 8.04. Taxes. (a) Any and all payments (other than the fees
payable under Section 7.09) by any Borrower or Guarantor to or for the account
of any Lender or the Administrative Agent (each, a "Relevant Payee") hereunder
or under any Note shall be made free and clear of, and without deduction for,
any and all present or future taxes, duties, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding:
(x) in the case of each Relevant Payee, taxes imposed on
its net income, and franchise taxes imposed on it, by the jurisdiction
under the laws of which such Relevant Payee is organized or any
political subdivision thereof; and
(y) in the case of each Lender, taxes imposed on its net
income, and franchise or similar taxes imposed on it, by the
jurisdiction of such Lender's Applicable Lending Office or any
political subdivision thereof.
In the case of each Relevant Payee, all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings and liabilities are hereinafter
referred to as its "Taxes", and all such taxes excluded under the foregoing
clauses (x) and (y) are hereinafter referred to as its "Domestic Taxes". If any
Borrower or Guarantor shall be required by law to deduct any Taxes from or in
respect of any sum (other than the fees payable under Section 7.09) payable
hereunder
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or under any Note to any Relevant Payee, (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), such Relevant Payee
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Borrower or Guarantor, as the case may be, shall
make such deductions, (iii) such Borrower or Guarantor, as the case may be,
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law and (iv) such Borrower or Guarantor
shall promptly furnish to the Administrative Agent, at its New York Office, the
original or a certified copy of a receipt evidencing payment thereof, and, if
such receipt relates to Taxes in respect of a sum payable to any Lender, the
Administrative Agent shall promptly deliver such original or certified copy to
such Lender.
(b) In addition, each Borrower agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made by it hereunder or under any
Note or from the execution or delivery of, or otherwise with respect to, this
Agreement or any of its Notes (hereinafter referred to as "Other Taxes").
(c) Each Borrower and Guarantor agrees to indemnify each Relevant
Payee for the full amount of Taxes imposed with respect to amounts paid
hereunder or under any Note (other than the fees payable under Section 7.09) and
Other Taxes (including, without limitation, any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section 8.04),
whether or not correctly or legally imposed, paid by such Relevant Payee and any
liability (including penalties, interest and expenses to the extent not
attributable to the gross negligence or willful misconduct of such Relevant
Payee) arising therefrom or with respect thereto. In addition, each Borrower and
Guarantor agrees to indemnify each Relevant Payee for all Domestic Taxes of such
Relevant Payee (calculated on a hypothetical basis at the maximum marginal rate
for a corporation) and any liability (including penalties, interest and expenses
to the extent not attributable to the gross negligence or willful misconduct of
such Relevant Payee) arising therefrom or with respect thereto, in each case to
the extent that such Domestic Taxes result from any payment or indemnification
pursuant to this Section 8.04. Indemnification pursuant to this subsection (c)
shall be calculated before giving effect to any refund of tax or tax credit to
be paid over to the relevant Borrower or Guarantor pursuant to Section 8.04(f)
and shall be made within 15 days after the Relevant Payee makes demand therefor.
(d) If any Borrower or Guarantor notifies any Lender that such
Borrower or Guarantor would be required to pay additional amounts to or for the
account of such Lender pursuant to this Section 8.04, such Lender will change
the jurisdiction of its Applicable Lending Office so as to eliminate or reduce
any such additional payment which may thereafter accrue if such change, in the
sole judgment of such Lender, is not disadvantageous to such Lender.
(e) Each Relevant Payee shall, at Alcan's request, use reasonable
efforts (consistent with applicable legal and regulatory restrictions) to file
any certificate or document requested by Alcan if the making of such a filing
would eliminate or reduce the amount of any additional amounts payable to or for
the account of such Relevant Payee pursuant to this Section 8.04 which may
thereafter accrue and would not, in the sole judgment of such Relevant Payee,
require
48
such Relevant Payee to disclose any confidential or proprietary information or
be otherwise disadvantageous to such Relevant Payee.
(f) If any Borrower or Guarantor makes any payment pursuant to
Section 8.04(a) or 8.04(c) with respect to a Lender, such Lender shall, upon the
reasonable request and at the expense of such Borrower or Guarantor, use
reasonable efforts to apply for a refund of tax (if such tax is not lawfully
imposed) or a credit against its tax liabilities on account of such payment;
provided that (A) such Lender shall have no obligation under this Section
8.04(f) if it determines, in its sole discretion, that claiming a refund or a
credit would have adverse tax consequences to it and (B) such Lender shall not
be under any obligation to claim a credit or refund in respect of such payment
in priority to any other claims, reliefs, credits or deductions available to it.
If such Lender receives such a refund or actually reduces its tax liabilities by
utilizing such a credit, such Lender shall, to the extent that it can do so
without prejudice to the retention of the amount of such refund or credit, pay
to the relevant Borrower or Guarantor an amount equal to the amount so received
or utilized (less any out-of-pocket expenses or taxes attributable to the
receipt of such refund or credit or its payment to the relevant Borrower or
Guarantor); provided that such Lender shall be required to pay to such Borrower
or Guarantor (i) only such amounts as such Lender determines, in its sole
discretion and by using any reasonable method which such Lender deems
appropriate, are attributable to such payment by such Borrower or Guarantor, and
(ii) only if no Event of Default exists at the time such Lender receives the
relevant refund or credit. If a Lender is in an excess foreign tax credit
position, such Lender shall be deemed not to have utilized a foreign tax credit
with respect to any such payment by any Borrower or Guarantor. Each Borrower and
Guarantor agrees to return, upon the request of a Lender, any payment made by
such Lender under this Section 8.04(f) (plus penalties, interest and other
charges imposed by a taxing authority) to such Lender if a taxing authority or
such Lender determines that (x) such Lender is required to repay such refund or
(y) such Lender is unable to utilize such credit. Any calculation or
determination made under this Section 8.04(f) by any Lender shall be conclusive
and final. Nothing contained in this Section 8.04(f) shall be construed to (i)
entitle any Borrower or Guarantor to obtain any tax or financial information
from any Lender, to obtain any other information determined by any Lender, in
its sole discretion, to be confidential or proprietary information of such
Lender, or to inspect or review any books and records of any Lender, (ii)
require any Lender to disclose to any Borrower, Guarantor or other party the
basis of any calculation of the amount of any tax benefit or any other amount or
the basis of any determination made under this Section 8.04(f), (iii) require
any Lender to institute any administrative proceeding (other than the filing of
a claim for any refund or credit) or judicial proceeding to obtain any refund or
credit or (iv) interfere with the rights of any Lender to conduct its fiscal or
tax affairs (including, without limitation, its determination as to whether to
claim a deduction or credit in respect of foreign taxes) in such manner as it
deems fit.
SECTION 8.05. Replacement of Lender. If (i) the obligation of any
Lender to make Euro-Currency Loans to any Borrower in any currency has been
suspended pursuant to Section 8.02 or (ii) any Lender has demanded compensation
under Section 8.03 or 8.04, Alcan shall have the right, with the assistance of
the Administrative Agent, to seek one or more Replacement Lenders to purchase
the Loans and assume the Commitment of such Lender (the "Exiting Lender"). The
Exiting Lender shall, upon reasonable notice and payment to it of the purchase
price agreed between it and the Replacement Lender or Lenders (or, failing such
agreement, a purchase price equal to the outstanding principal amount of its
Loans and interest accrued thereon to but
49
excluding the date of payment), assign all its rights and obligations under this
Agreement and the Notes (including its Commitment) to the Replacement Lender or
Lenders, and the Replacement Lender or Lenders shall assume their respective pro
rata shares of each of such rights and obligations, in accordance with Section
10.06(c). In connection with any such sale, Alcan shall pay to the Exiting
Lender all fees accrued for its account hereunder to but excluding the date of
such sale plus, if demanded by the Exiting Lender at least two Domestic Business
Days before such sale, (i) the amount of any compensation which would be due to
the Exiting Lender under Section 2.15 if the relevant Borrowers had prepaid the
outstanding Euro-Currency Loans of the Exiting Lender on the date of such sale
and (ii) any additional compensation, Taxes or other amounts accrued for its
account under Section 8.03 or 8.04 to but excluding said date (it being
understood that the Exiting Lender shall retain its right to be compensated
after the date of such sale for any such accrued amounts remaining unpaid).
SECTION 8.06. Substitution of Dollar-Denominated Loans for Affected
Euro-Currency Loans. (a) If and so long as the obligation of any Lender to make
Euro-Currency Loans to any Borrower in any currency is suspended pursuant to
Section 8.02, such Lender shall, on the occasion of each Borrowing comprised of
Euro-Currency Loans by such Borrower in such currency, make a Euro-Dollar Loan
(or, if the affected currency is Dollars, a Base Rate Loan) to such Borrower on
the date of such Borrowing in the same Dollar Amount as the Euro-Currency Loan
that such Lender would otherwise have made as part of such Borrowing.
(b) If and so long as any Lender demands compensation under
Section 8.03 or 8.04 with respect to its Euro-Currency Loans to any Borrower in
any currency, Alcan may, by at least three Euro-Currency Business Day's notice
to such Lender and the Administrative Agent, require such Lender to make a
Euro-Dollar Loan or Base Rate Loan (as specified in such notice) to such
Borrower on the date of each Borrowing comprised of Euro-Currency Loans by such
Borrower in such currency and in the same Dollar Amount as the Euro-Currency
Loan that such Lender would otherwise have made as part of such Borrowing.
(c) If, as a result of this Section or Section 8.02, any Lender's
Loan included in any Group of Loans is of a different type or in a different
currency than the other Loans in such Group, such Lender shall notify the
relevant Borrower and the Administrative Agent if and when the circumstances
giving rise to the related suspension of such Lender's obligations or its demand
for compensation no longer exist. Promptly after such notice is given, such
Lender, the relevant Borrower and the Administrative Agent shall make such
arrangements as shall be required so that, on the first day of the next
succeeding Interest Period applicable to such Group of Loans, such Lender's Loan
included therein shall be converted to a Loan of the same type and currency (and
increased or decreased, if necessary, so as to be in the same amount) as the
Loan it would have had outstanding as part of such Group of Loans if the
provisions of Section 8.02 or this Section, as the case may be, had never been
applied thereto.
ARTICLE 9
GUARANTY
SECTION 9.01. The Guaranty. Alcan hereby unconditionally guarantees the
full and punctual payment (whether at stated maturity, upon acceleration or
otherwise) of the principal of
50
and interest on each Loan borrowed by any Designated Subsidiary pursuant to this
Agreement, and the full and punctual payment of all other amounts payable by any
Designated Subsidiary under this Agreement. Upon failure by any Designated
Subsidiary to pay any such amount when due, Alcan shall forthwith on demand pay
the amount not so paid at the place and in the manner and currency specified in
this Agreement.
SECTION 9.02. Guaranty Unconditional. The obligations of Alcan under
this Article 9 shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise,
waiver or release in respect of any obligation of any Designated
Subsidiary under this Agreement or any of its Notes, by operation of
law or otherwise;
(ii) any modification or amendment of or supplement to
this Agreement or any Note of such Designated Subsidiary (except that
the guarantee of Alcan under this Article 9 shall apply to the
obligations of such Designated Subsidiary as modified, amended or
supplemented thereby);
(iii) any release, impairment, non-perfection or invalidity
of any direct or indirect security for any obligation of any Designated
Subsidiary under this Agreement or any of its Notes;
(iv) any change in the corporate existence, structure or
ownership of any Designated Subsidiary, or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any Designated
Subsidiary or its assets or any resulting release or discharge of any
obligation of any Designated Subsidiary contained in this Agreement or
any of its Notes;
(v) the existence of any claim, set-off or other rights
which Alcan may have at any time against any Designated Subsidiary,
Agent, Lender or other Person, whether in connection herewith or with
any unrelated transactions, provided that nothing herein shall prevent
the assertion of any such claim by separate suit or compulsory
counterclaim;
(vi) any invalidity or unenforceability relating to or
against any Designated Subsidiary for any reason of this Agreement or
any of its Notes, or any provision of applicable law or regulation
purporting to prohibit the payment by any Designated Subsidiary of the
principal of or interest on any of its Notes or any other amount
payable by it under this Agreement; or
(vii) any other act or omission to act or delay of any kind
by any Designated Subsidiary, Agent, Lender or other Person or any
other circumstance whatsoever which might, but for the provisions of
this paragraph, constitute a legal or equitable discharge of Alcan's
obligations hereunder.
SECTION 9.03. Discharge Only Upon Payment in Full; Reinstatement in
Certain Circumstances. Alcan's obligations under this Article 9 shall remain in
full force and effect until all the Commitments shall have terminated and the
principal of and interest on the Loans of the
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Designated Subsidiaries and all other amounts payable by Alcan and each
Designated Subsidiary under this Agreement shall have been paid in full. If at
any time any payment of the principal of or interest on any Loan of any
Designated Subsidiary or any other amount payable by any Designated Subsidiary
under this Agreement is rescinded or must be otherwise restored or returned upon
the insolvency, bankruptcy or reorganization of such Designated Subsidiary or
otherwise, Alcan's obligations hereunder with respect to such payment shall be
reinstated at such time as though such payment had been due but not made at such
time.
SECTION 9.04. Waiver by Alcan. Alcan irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by any Person
against any Designated Subsidiary or any other Person.
SECTION 9.05. Subrogation. Upon making any payment with respect to the
obligations of any Designated Subsidiary hereunder, Alcan shall be subrogated to
the rights of the payee against such Designated Subsidiary with respect to such
payment; provided that Alcan shall not enforce any payment by way of subrogation
against such Designated Subsidiary so long as (i) any Lender has any Commitment
hereunder (unless such Subsidiary is no longer a Designated Subsidiary for
purposes hereof) or (ii) any amount payable by such Designated Subsidiary
hereunder remains unpaid.
SECTION 9.06. Stay of Acceleration. If acceleration of the time for
payment of any amounts payable by any Designated Subsidiary under this Agreement
or its Notes is stayed upon the insolvency, bankruptcy or reorganization of such
Designated Subsidiary, all such amounts otherwise subject to acceleration under
the terms of this Agreement shall nonetheless be payable by Alcan hereunder
forthwith on demand by the Administrative Agent made at the request of the
Required Lenders.
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, telex,
facsimile transmission or similar writing) and shall be given to such party:
(i) if to Alcan, at its address or telex or facsimile
number set forth on the signature pages hereof;
(ii) if to the Administrative Agent, at its address or
facsimile number set forth on the signature pages hereof;
(iii) if to any Designated Subsidiary, at its address set
forth in its Election to Participate;
(iv) if to any Lender, at its address or telex or
facsimile number set forth in its Administrative Questionnaire;
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(v) if to the Arranger at its address or facsimile number
set forth on the signature pages hereof; or
(vi) if to the Lead Tender Offer Guarantor, at its address
or facsimile number set forth on the signature pages hereof;
or in the case of any party, at such other address or telex or facsimile number
as such party may hereafter specify for the purpose by notice to the
Administrative Agent and Alcan. Each such notice, request or other communication
shall be effective (A) if given by telex, when such telex is transmitted to the
telex number specified in this Section and the appropriate answerback is
received, (B) if given by facsimile transmission, when transmitted to the
facsimile number referred to in this Section and confirmation of receipt is
received, (C) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid, or (D) if
given by any other means, when delivered at the address specified in or pursuant
to this Section; provided that notices to the Administrative Agent under Article
2 or Article 8 shall not be effective until received.
SECTION 10.02. No Waivers. No failure or delay by any Agent, Lender or
Tender Offer Guarantor in exercising any right, power or privilege hereunder or
under any Note shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 10.03. Expenses; Indemnification. (a) Alcan shall pay (i) all
reasonable out-of-pocket expenses of the Agents, including reasonable fees and
disbursements of special counsel for the Agents, in connection with the
negotiation, preparation and administration of this Agreement or any waiver or
consent hereunder or any amendment hereof or any Default or alleged Default
hereunder and (ii) if an Event of Default occurs, all out-of-pocket expenses
incurred by the Administrative Agent or any Lender, including fees and
disbursements of counsel (including, without limitation, allocated costs of
in-house counsel), in connection with such Event of Default and any collection,
bankruptcy, insolvency and other enforcement proceedings resulting therefrom.
(b) Alcan agrees to indemnify each Agent, each Lender and each
Tender Offer Guarantor, their respective affiliates and the respective
directors, officers, agents and employees of the foregoing (each, an
"Indemnitee") and hold each Indemnitee harmless from and against any and all
liabilities, losses, damages, costs and expenses of any kind, including, without
limitation, the reasonable fees and disbursements of counsel (including, without
limitation, reasonable allocated costs of in-house counsel), which may be
incurred by such Indemnitee in connection with any investigative, administrative
or judicial proceeding (whether or not such Indemnitee shall be designated a
party thereto) brought or threatened relating to or arising out of this
Agreement or any actual or proposed use of proceeds of Loans; provided that no
Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee's own gross negligence or willful misconduct as finally determined by
a court of competent jurisdiction.
(c) Alcan agrees to indemnify promptly, on demand, each Lender for
any Counter-Indemnity Payment made by such Lender. The obligations of Alcan
under this Section 10.03(c)
53
shall be unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(i) any extension, waiver or consent granted by or to, or
agreement with, any Borrower, any Guarantor, the CMF, any Lender or any
other Person;
(ii) the release of any Borrower, any Guarantor, any
Lender or any other Person under the terms of any agreement or
arrangement with any creditor of such Person;
(iii) the taking, variation, compromise, exchange, renewal
or release of, or refusal or neglect to perfect, take up or enforce,
any rights against, or security over assets of, any Borrower, any
Guarantor, the CMF or any other Person or arising under the Tender
Offer Guarantee or any non-presentation or non-observance of any
formality or other requirement in respect of any instrument or any
failure to realize the full value of any security;
(iv) any incapacity or lack of power, authority or legal
personality of or dissolution or change in the members or status of any
Borrower, any Guarantor, the CMF, any Lender or any other Person;
(v) any amendment (however fundamental) or replacement or
extension of or increase in liabilities under or reopening or renewal
of the Tender Offer Guarantee (so that references in this Agreement to
the Tender Offer Guarantee shall include each such amendment or
replacement), this Agreement or any other document or security;
(vi) any unenforceability, illegality or invalidity of any
obligation of any Person under this Agreement, the Tender Offer
Guarantee or any other document or security; or
(vii) any insolvency or similar proceedings relating to any
Person.
SECTION 10.04. Set-offs. (a) If (i) an Event of Default has occurred
and is continuing and (ii) Lenders holding more than 50% in aggregate Dollar
Amount of the Loans have requested the Administrative Agent to declare the Loans
to be immediately due and payable pursuant to Section 6.01, or the Loans have
become immediately due and payable without notice as provided in Section 6.01,
then each Lender is hereby authorized by each Borrower at any time and from time
to time, to the extent permitted by applicable law, without notice to such
Borrower (any such notice being expressly waived by each Borrower), to set off
and apply all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Lender
to or for the account of such Borrower against any obligations of such Borrower
to such Lender now or hereafter existing under this Agreement, irrespective of
whether or not such Lender shall have made any demand under this Agreement. Each
Lender agrees promptly to notify the relevant Borrower after any such set-off
and application made by such Lender; provided that any failure to give such
notice shall not affect the validity of such setoff and application. The rights
of the Lenders under this subsection are in addition to any other rights and
remedies which the Lenders may have. Each Borrower agrees, to the fullest extent
it may effectively do so under applicable law, that any holder of a
participation in any of
54
its Loans, whether acquired pursuant to Section 10.06(b), subsection (b) of this
Section or otherwise, may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of such Borrower in the amount of such
participation.
(b) Each Lender agrees that if it shall, by exercising any right
of set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest then due with respect to any Loan
held by it which is greater than the proportion received by any other Lender in
respect of the aggregate amount of principal and interest then due with respect
to any Loan of the same Borrower held by such other Lender, the Lender receiving
such proportionately greater payment shall purchase such participations in the
Loans of the same Borrower held by the other Lenders, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Loans of the same Borrower held by the Lenders
shall be shared by the Lenders pro rata; provided that nothing in this
subsection shall impair the right of any Lender to exercise any right of set-off
or counterclaim it may have and to apply the amount subject to such exercise to
the payment of indebtedness of the relevant Borrower other than its indebtedness
under this Agreement.
SECTION 10.05. Amendments and Waivers. Any provision of this Agreement
or the Notes may be amended or waived if, but only if, such amendment or waiver
is in writing and is signed by Alcan, each Subsidiary Guarantor (if any) and the
Required Lenders (and, if the rights or duties of any Agent or Tender Offer
Guarantor are affected thereby, by such Agent or Tender Offer Guarantor);
provided that no such amendment or waiver shall, unless signed by all the
Lenders:
(i) increase or decrease any Commitment of any Lender
(except for a ratable decrease in all the Commitments) or subject such
Lender to any additional obligation;
(ii) reduce the principal of or rate of interest on any
Loan or any fees payable hereunder with respect to the Commitments or
the Loans; or
(iii) postpone the date fixed for any payment of principal
of or interest on any Loan or any fees hereunder with respect to the
Commitments or the Loans;
(iv) release Alcan from any of its obligations under
Article 9 or Section 10.03(c) or release any Subsidiary Guarantor from
any of its obligations under its Subsidiary Guaranty Agreement;
(v) change this proviso or the definition of "Alternative
Currencies"; or
(vi) change the percentage of the Commitments or of the
aggregate Dollar Amount of the Loans, or the number of Lenders, which
shall be required for the Lenders, or any of them, to take any action
under this Section or any other provision of this Agreement.
No such amendment or waiver shall, unless signed by a Designated Subsidiary, (w)
subject such Designated Subsidiary to any additional obligation, (x) increase
the principal of or rate of interest
55
on any outstanding Loan to such Designated Subsidiary, (y) accelerate the stated
maturity of any outstanding Loan to such Designated Subsidiary or (z) change
this sentence.
SECTION 10.06. Participations and Assignments. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that no Borrower may
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of all the Lenders.
(b) Any Lender may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in any or all of its
Commitments or any or all of its Loans. If a Lender grants any such
participating interest to a Participant, whether or not upon notice to the
Borrowers and the Administrative Agent, such Lender shall remain responsible for
the performance of its obligations hereunder, and the Borrowers and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement.
Any agreement pursuant to which any Lender may grant such a participating
interest shall provide that such Lender shall retain the sole right and
responsibility to enforce the obligations of the Borrowers hereunder including,
without limitation, the right to approve any amendment or waiver of any
provision of this Agreement; provided that such participation agreement may
provide that such Lender will not agree to any amendment or waiver of this
Agreement described in clause (i), (ii), (iii) or (iv) of Section 10.05 without
the consent of the Participant. Any Lender that grants or agrees to grant one or
more participating interests pursuant to this subsection shall be entitled to
claim and receive under Section 2.15, 8.03 or 8.04 from time to time, for the
benefit of itself and its Participants, the full amount that such Lender would
have been entitled to claim and receive under said Section at such time if it
had not granted or agreed to grant such participating interests. An assignment
or other transfer which is not permitted by subsection (c) or (d) of this
Section shall be given effect for purposes of this Agreement only to the extent
of a participating interest granted in accordance with this subsection.
(c) Any Lender may at any time assign to one or more banks or
other institutions (each an "Assignee") all, or a proportionate part of all, of
its rights and obligations under this Agreement and the Notes, and such Assignee
shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement substantially in the form of Exhibit G hereto signed by
such Assignee and such transferor Lender, but only with (and subject to) the
written consent of Alcan and the Administrative Agent (which consents shall not
be unreasonably withheld); provided that (i) if an Assignee is an affiliate of
such transferor Lender or was a Lender immediately before such assignment, no
such consent shall be required, and (ii) Alcan's consent shall not be required
if any of the Events of Default specified in subsection (a), (f) or (g) of
Section 6.01 has occurred and is continuing. No assignment of only a
proportionate part of the rights and obligations of a Lender under this
Agreement and the Notes may be made unless the "Assigned Amount" set forth in
the related Assignment and Assumption Agreement, and the remaining amount
retained by the transferor Lender, are each at least $1,000,000; provided that
(x) such minimum assigned amount (but not the minimum retention amount) shall
not apply to an assignment to an Assignee that was a Lender immediately before
such assignment and (y) neither such minimum assigned amount nor the minimum
retention amount shall apply to any assignment effected while an Event of
Default has occurred and is continuing. When such instrument has been signed and
delivered by the parties thereto and such Assignee has paid to
56
such transferor Lender the purchase price agreed between them, such Assignee
shall be a Lender party to this Agreement and shall have all the rights and
obligations of a Lender with Commitments as set forth in such instrument of
assumption, and the transferor Lender shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required. Upon the consummation of any assignment pursuant to
this subsection, the transferor Lender, the Administrative Agent and the
Borrowers shall make appropriate arrangements so that, if required, new Notes
are issued to the Assignee. Any such assignment shall include the same
proportionate part of the transferor Lender's Commitment and outstanding Loans.
(d) Any Lender may at any time assign all or any portion of its
rights under this Agreement and its Notes to a Federal Reserve Bank. No such
assignment shall release the transferor Lender from its obligations hereunder
and the Borrowers and the Administrative Agent shall continue to deal solely and
directly with such transferor Lender in connection with such transferor Lender's
rights and obligations hereunder.
(e) No Assignee or other transferee of any Lender's rights shall
be entitled to receive any greater payment under Section 8.03 or 8.04 than such
Lender would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with Alcan's prior written consent or
by reason of the provisions of Section 8.02, 8.03 or 8.04 requiring such Lender
to designate a different Applicable Lending Office under the circumstances
referred to therein or at a time when the circumstances giving rise to such
greater payment did not exist.
SECTION 10.07. No Reliance on Margin Stock. Each of the Lenders
represents to each Agent and other Lender that it in good faith is not relying
upon any Margin Stock as collateral in the extension or maintenance of the
credit provided for in this Agreement.
SECTION 10.08. Waiver of Jury Trial. EACH OF THE BORROWERS, THE AGENTS
AND THE LENDERS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 10.09. Judicial Proceedings. (a) Submission to Jurisdiction.
Each Borrower hereby submits to the nonexclusive jurisdiction of the United
States District Court for the Southern District of New York and of any New York
State court sitting in New York City for purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. Each Borrower irrevocably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of the venue
of any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.
(b) Appointment of Agent for Service of Process. Each Borrower
irrevocably designates and appoints CT Corporation System having an office on
the date hereof at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as such
Borrower's authorized agent, to accept and acknowledge on its behalf service of
any and all process which may be served in any suit, action or proceeding
referred to in subsection (a) above in any federal or New York State court
sitting in New York City. Each Borrower represents and warrants that such agent
has agreed to accept
57
such appointment. Said designation and appointment shall not be revocable by any
Borrower until all principal, interest and other amounts payable hereunder shall
have been paid in full in accordance with the provisions hereof or, if earlier,
when such Borrower's status as a Borrower hereunder is terminated pursuant to
Section 2.18. If such agent shall cease to act as agent for any Borrower, such
Borrower agrees to designate irrevocably and appoint without delay another such
agent satisfactory to the Administrative Agent.
(c) Service of Process. Each Borrower consents to process being
served in any suit, action or proceeding referred to in subsection (a) above in
any federal or New York State court sitting in New York City by service of
process upon its agent appointed as provided in subsection (b) above; provided
that, to the extent lawful and possible, notice of said service upon such agent
shall be mailed by registered or certified air mail, postage prepaid, return
receipt requested, to such Borrower at its address specified in or pursuant to
Section 10.01. Each Borrower irrevocably waives, to the fullest extent permitted
by law, all claim of error by reason of service in such manner and agrees that
such service shall be deemed in every respect effective service of process upon
such Borrower in any such suit, action or proceeding and shall, to the fullest
extent permitted by law, constitute valid and personal service upon and personal
delivery to such Borrower.
(d) No Limitation on Service or Suit. Nothing in this Section
shall affect the right of the Administrative Agent or any Lender to serve
process in any other manner permitted by law or limit the right of the
Administrative Agent or any Lender to bring proceedings against any Borrower in
the courts of any jurisdiction or jurisdictions.
SECTION 10.10. Governing Law. This Agreement and each Note shall be
governed by and construed in accordance with the laws of the State of New York.
SECTION 10.11. Counterparts; Integration. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement constitutes the entire agreement and understanding among the
parties hereto and supersedes any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof.
[This space intentionally left blank - signature pages follow.]
58
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
ALCAN INC.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------------------
Title: Senior Vice President, Mergers
and Acquisitions, and Chief Legal Officer
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇ - Alcan Treasury
Telex No.: #05-25236
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING
(NOVA SCOTIA) CO.,
as Administrative Agent and Lender
By /s/ Jaap Tonckens
------------------------------------------------
Title: Vice President
▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention:
Facsimile:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING
(NOVA SCOTIA) CO., as Arranger
By /s/ Jaap Tonckens
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Title: Vice President
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Attention:
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO.
INTERNATIONAL LIMITED,
as Lead Tender Offer Guarantor
By /s/ ▇▇▇▇▇▇▇ Zauoi
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Title: Managing Director
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Attention:
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