Exhibit 4
EXECUTION COPY
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CREDIT AGREEMENT
among
▇▇▇▇▇▇ CORPORATION,
as Borrower,
THE LENDERS NAMED HEREIN,
as Lenders
and
SUNTRUST BANK,
as Administrative Agent
up to
$300,000,000
Senior Credit Facility
Dated as of September 30, 2003
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ARTICLE I DEFINITIONS......................................................1
1.1 Defined Terms.......................................................1
1.2 Accounting Terms...................................................18
1.3 Other Terms; Construction..........................................19
ARTICLE II AMOUNT AND TERMS OF THE LOANS...................................19
2.1 Commitments........................................................19
2.2 Borrowings.........................................................19
2.3 Disbursements; Funding Reliance; Domicile of Loans.................20
2.4 Notes..............................................................21
2.5 Termination and Reduction of Commitments...........................21
2.6 Mandatory Payments and Prepayments.................................22
2.7 Voluntary Prepayments..............................................22
2.8 Interest...........................................................23
2.9 Fees...............................................................24
2.10 Interest Periods...................................................25
2.11 Conversions and Continuations......................................25
2.12 Method of Payments; Computations...................................26
2.13 Recovery of Payments...............................................27
2.14 Use of Proceeds....................................................28
2.15 Pro Rata Treatment.................................................28
2.16 Increased Costs; Change in Circumstances; Illegality; etc..........28
2.17 Taxes..............................................................31
2.18 Compensation.......................................................34
2.19 Replacement of Lenders.............................................34
2.20 Increase in Commitments............................................35
ARTICLE III CONDITIONS OF BORROWING.........................................36
3.1 Conditions to Effectiveness........................................36
3.2 Conditions of All Borrowings.......................................37
ARTICLE IV REPRESENTATIONS AND WARRANTIES..................................38
4.1 Organization; Power; Qualification.................................38
4.2 Ownership..........................................................38
4.3 Authorization......................................................38
4.4 Compliance of Agreement with Laws, Etc.............................39
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4.5 Compliance with Law; Governmental Approvals........................39
4.6 Litigation.........................................................39
4.7 Tax Returns and Payments...........................................40
4.8 Intellectual Property Matters......................................40
4.9 Environmental Matters..............................................40
4.10 ERISA..............................................................41
4.11 Margin Stock.......................................................42
4.12 Government Regulation..............................................42
4.13 Material Contracts.................................................42
4.14 Burdensome Provisions..............................................43
4.15 Financial Matters..................................................43
4.16 No Material Adverse Change.........................................44
4.17 Reinsurance Agreements.............................................44
4.18 Absence of Defaults................................................44
4.19 Accuracy and Completion of Information.............................44
ARTICLE V AFFIRMATIVE COVENANTS...........................................45
5.1 GAAP Financial Statements..........................................45
5.2 Statutory Financial Statements.....................................46
5.3 Other Business and Financial Information...........................46
5.4 Accuracy of Information............................................49
5.5 Taxes..............................................................49
5.6 Insurance..........................................................49
5.7 Corporate Existence; Franchises....................................49
5.8 Properties.........................................................49
5.9 ERISA..............................................................50
5.10 Investment Guidelines..............................................50
5.11 Compliance with Laws...............................................50
5.12 Accounting Methods and Financial Records...........................50
5.13 Visits and Inspections.............................................50
5.14 Conduct of Business................................................50
5.15 Further Assurances.................................................50
ARTICLE VI FINANCIAL COVENANTS.............................................51
6.1 Leverage Ratio.....................................................51
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6.2 Minimum Consolidated Net Worth.....................................51
6.3 Debt Service Reserve...............................................51
6.4 Available Dividend Amount Coverage Ratio...........................51
ARTICLE VII NEGATIVE COVENANTS..............................................51
7.1 Indebtedness.......................................................52
7.2 Liens..............................................................53
7.3 Merger, Acquisition, Sale of Assets and Liquidation................53
7.4 Acquisitions; Investments..........................................54
7.5 Transactions with Excluded Subsidiaries and Affiliates.............54
7.6 Use of Proceeds....................................................54
7.7 Certain Accounting Changes.........................................55
7.8 No Other Negative Pledges..........................................55
7.9 Additional Securities..............................................55
ARTICLE VIII EVENTS OF DEFAULT...............................................55
8.1 Events of Default..................................................55
8.2 Remedies: Termination of Commitments, Acceleration, etc............57
8.3 Remedies: Set-Off.................................................58
ARTICLE IX THE ADMINISTRATIVE AGENT........................................58
9.1 Appointment........................................................58
9.2 Nature of Duties...................................................58
9.3 Exculpatory Provisions.............................................59
9.4 Reliance by Administrative Agent...................................59
9.5 Non-Reliance on Administrative Agent and Other Lenders.............60
9.6 Notice of Default..................................................60
9.7 Indemnification....................................................60
9.8 The Administrative Agent in its Individual Capacity................61
9.9 Successor Administrative Agent.....................................61
ARTICLE X MISCELLANEOUS...................................................62
10.1 Fees and Expenses..................................................62
10.2 Indemnification....................................................62
10.3 Governing Law; Consent to Jurisdiction.............................63
10.4 Waiver of Jury Trial...............................................63
10.5 Notices............................................................64
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10.6 Amendments, Waivers, etc...........................................65
10.7 Assignments, Participations........................................65
10.8 No Waiver..........................................................68
10.9 Successors and Assigns.............................................68
10.10 Survival...........................................................68
10.11 Severability.......................................................68
10.12 Construction.......................................................68
10.13 Confidentiality....................................................69
10.14 Counterparts; Effectiveness........................................69
10.15 Disclosure of Information..........................................69
10.16 Entire Agreement...................................................69
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SCHEDULES
Schedule 4.2 Subsidiaries
Schedule 7.1 Indebtedness
EXHIBITS
Exhibit A Form of Note
Exhibit B-1 Form of Notice of Borrowing
Exhibit B-2 Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D-1 Form of Assignment and Acceptance
Exhibit D-2 Form of Joinder Agreement
Exhibit E Form of Opinion of McGuireWoods LLP
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of the 30th day of September, 2003 (this
"Agreement"), is made among ▇▇▇▇▇▇ CORPORATION, a Virginia corporation with its
principal offices in Glen Allen, Virginia (the "Borrower"), the banks and
financial institutions listed on the signature pages hereto or that become
parties hereto after the date hereof (collectively, the "Lenders"), and SUNTRUST
BANK, a Georgia banking corporation ("SunTrust"), as administrative agent for
the Lenders (in such capacity, the "Administrative Agent").
RECITALS
A. The Borrower currently has available to it a $300,000,000 credit
facility pursuant to the terms of the Existing Credit Agreement (defined below).
B. The Borrower wishes to terminate the Existing Credit Agreement and
replace it with a revolving credit facility that the Borrower is requesting the
Lenders make available to it in the aggregate principal amount of up to
$300,000,000 pursuant to the terms of this Agreement.
C. The Borrower will use the proceeds of this facility for general
corporate purposes, all as more fully described herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual provisions, covenants and
agreements herein contained, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Defined Terms. For purposes of this Agreement, in addition to the
terms defined elsewhere herein, the following terms shall have the meanings set
forth below (such meanings to be equally applicable to the singular and plural
forms thereof):
"Account Designation Letter" shall mean a letter from the Borrower to the
Administrative Agent, duly completed and signed by an Authorized Officer and in
form and substance satisfactory to the Administrative Agent, listing any one or
more accounts to which the Borrower may from time to time request the
Administrative Agent to forward the proceeds of any Loans made hereunder.
"Acquisition" shall mean any transaction or series of related transactions,
consummated on or after the date hereof, by which the Borrower directly, or
indirectly through one or more Subsidiaries, (i) acquires any going business, or
all or substantially all of the assets, of any Person, whether through purchase
of assets, merger or otherwise, or (ii) acquires securities or
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other ownership interests of any Person having at least a majority of combined
voting power of the then outstanding securities or other ownership interests of
such Person.
"Adjusted LIBOR Rate" shall mean, at any time with respect to any LIBOR
Loan, a rate per annum equal to the LIBOR Rate as in effect at such time plus
the Applicable Margin Percentage for LIBOR Loans as in effect at such time.
"Affiliate" shall mean, with respect to any Person, any other Person which
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person. The term "control"
means (a) the power to vote twenty percent (20%) or more of the securities or
other equity interests of a Person having ordinary voting power, or (b) the
possession, directly or indirectly, of any other power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise. Notwithstanding the foregoing,
no individual shall be deemed an Affiliate of a specified Person solely by
reason of his or her being a director, officer or employee of such specified
Person or any of its Subsidiaries.
"Administrative Agent" shall mean SunTrust, in its capacity as
Administrative Agent appointed under Article IX, and its successors and
permitted assigns in such capacity.
"Agreement" shall mean this Credit Agreement, as amended, modified or
supplemented from time to time.
"Aggregate Commitment" shall mean the Commitments of all of the Lenders.
"AIIC" shall mean Associated International Insurance Company, a California
insurance company.
"Annual Statement" shall mean, with respect to any Insurance Subsidiary,
the statutory annual financial statement of such Insurance Subsidiary as is
required to be filed with the applicable Governmental Authority of its
jurisdiction of domicile, together with all exhibits and schedules filed
therewith. References herein to items on particular pages, lines, columns,
exhibits and schedules to an Annual Statement are based on the format
promulgated by the National Association of Insurance Commissioners for 2002
Statutory Annual Statements, and if such format is changed in future years so
that different information is contained in such items or they no longer exist,
it is understood and agreed that the reference contained herein is to the item
of information consistent with that reported in the referenced item in the 2002
Annual Statement of such Insurance Subsidiary.
"Applicable Law" shall mean all applicable provisions of constitutions,
statutes, laws, rules, treaties, regulations and orders of all Governmental
Authorities and all orders and decrees of all courts and arbitrators.
"Applicable Margin Percentage" shall mean, (a) the applicable percentage to
be added to the LIBOR Rate pursuant to Section 2.8 for purposes of determining
the Adjusted LIBOR Rate, and (b) the applicable percentage to be used in
calculating the commitment fee payable pursuant to Section 2.9(b), in each case
as determined under the following matrix with reference to the Borrower's
Leverage Ratio:
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Applicable Margin
Applicable Margin Percentage for
Percentage for Unutilized
Level Leverage Ratio LIBOR Loans Commitments Fee
----- --------------- ----------------- ----------------
I * 0.35:1 1.500% 0.40%
II * 0.30:1***.35:1 1.250% 0.30%
III * 0.25:1***.30:1 1.00% 0.20%
IV ** 0.25:1 0.90% 0.15%
* more than or equal to
** less than or equal to
*** less than
Initially, the Applicable Margin Percentages shall be determined by
reference to Level III in the matrix above. On the Business Day after the
date each Compliance Certificate is required to be delivered pursuant to
Section 5.3, the Applicable Margin Percentage for all LIBOR Loans payable
pursuant to Section 2.8(a)(ii) and the commitment fee payable pursuant to
Section 2.9(b) shall be adjusted effective as of such date in accordance
with the above matrix and the Leverage Ratio as calculated in such
Compliance Certificate. If the required Compliance Certificate is not
delivered on or prior to any date such delivery is required pursuant to
Section 5.3, then during the period from the first Business Day after such
date to the date such Compliance Certificate is delivered, the Applicable
Margin Percentage shall be determined by reference to Level I in the matrix
above.
"Assignee" shall have the meaning given to such term in Section 10.7(a).
"Assignment and Acceptance" shall mean an Assignment and Acceptance entered
into between a Lender and an Assignee and accepted by the Administrative Agent
and the Borrower, in substantially the form of Exhibit D-1.
"Authorized Officer" shall mean, with respect to any action specified
herein, any officer of the Borrower duly authorized by resolution of the board
of directors of the Borrower to take such action on its behalf, and whose
signature and incumbency shall have been certified to the Administrative Agent
by the secretary or an assistant secretary of the Borrower.
"Available Dividend Amount" shall mean, (a) with respect to any U.S.
Insurance Subsidiary for any fiscal year, the aggregate maximum amount of
dividends that is permitted by the Insurance Regulatory Authority of its
jurisdiction of domicile, under Applicable Law (without the necessity of any
consent, approval or other action of such Insurance Regulatory Authority
involving the granting of permission or the exercise of discretion by such
Insurance Regulatory Authority), to be paid by such U.S. Insurance Subsidiary to
the Borrower or another Subsidiary of the Borrower during such fiscal year
(whether or not any such dividends are actually paid) and (b) with respect to
any Non-U.S. Insurance Subsidiary for any fiscal year, the greatest of (i) 10%
of the Statutory Capital and Surplus of such Non-U.S. Insurance Subsidiary as of
the last day of the immediately preceding fiscal year, and (ii) the net income
of such Non-U.S. Insurance Subsidiary for the immediately preceding fiscal year.
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"Bankruptcy Code" shall mean 11 U.S.C. Sections 101 et seq., as amended
from time to time, and any successor statute.
"Base Rate" shall mean the higher of (i) the per annum interest rate
publicly announced from time to time by SunTrust, to be its prime rate (which
may not necessarily be its best lending rate), as adjusted to conform to changes
as of the opening of business on the date of any such change in such prime rate,
and (ii) the Federal Funds Rate plus 0.5% per annum, as adjusted to conform to
changes as of the opening of business on the date of any such change in the
Federal Funds Rate.
"Base Rate Loan" shall mean, at any time, any Loan that bears interest at
such time at the Base Rate.
"Borrowing" shall mean the incurrence by the Borrower (including as a
result of conversions and continuations of outstanding Loans pursuant to Section
2.11) on a single date of a group of Loans of a single Type and, in the case of
LIBOR Loans, as to which a single Interest Period is in effect.
"Borrowing Date" shall mean, with respect to any Borrowing, the date upon
which such Borrowing is made.
"Business Day" shall mean (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in Atlanta, Georgia and Richmond, Virginia are open for the conduct
of their commercial banking business, and (b) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
any LIBOR Loan, any day that is a Business Day described in clause (a) and that
is also a day for trading by and between banks in Dollar deposits in the London
interbank Eurodollar market.
"Capital Lease" shall mean, with respect to any Person, any lease of any
property that should, in accordance with GAAP, be classified and accounted for
as a capital lease on a consolidated balance sheet of such Person and its
Subsidiaries.
"Capital Lease Obligation" shall mean, at any time, the amount that should,
in accordance with GAAP, be reported as of such time as a liability on the
balance sheet of the lessee with respect to a Capital Lease.
"Capital Stock" shall mean (i) with respect to any Person that is a
corporation, any and all shares, interests or equivalents in capital stock
(whether voting or nonvoting, and whether common or preferred) of such
corporation, and (ii) with respect to any Person that is not a corporation, any
and all partnership, membership, limited liability company or other equity
interests of such Person; and in each case, any and all warrants, rights or
options to purchase any of the foregoing.
"Cash Equivalents" shall mean (i) securities issued or unconditionally
guaranteed by the United States of America or any agency or instrumentality
thereof, backed by the full faith and credit of the United States of America,
(ii) commercial paper issued by any Person organized under the laws of the
United States of America, maturing within 90 days from the date of
4
acquisition and, at the time of acquisition, having a rating of at least A-1 or
the equivalent thereof by Standard & Poor's Ratings Services or at least P-1 or
the equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc., (iii) time deposits
and certificates of deposit maturing within 90 days from the date of issuance
and issued by a bank or trust company organized under the laws of the United
States of America or any state thereof that has combined capital and surplus of
at least $500,000,000 and that has (or is a subsidiary of a bank holding company
that has) a long-term unsecured debt rating of at least A or the equivalent
thereof by Standard & Poor's Ratings Services or at least A2 or the equivalent
thereof by ▇▇▇▇▇'▇ Investors Service, Inc., (iv) repurchase obligations with a
term not exceeding seven (7) days with respect to underlying securities of the
types described in clause (i) above entered into with any bank or trust company
meeting the qualifications specified in clause (iii) above, and (v) money market
funds at least 95% of the assets of which are continuously invested in
securities of the type described in clauses (i) through (iv) above.
"Closing Date" shall mean the date upon which the conditions precedent in
Section 3.1 to the initial Borrowing hereunder are satisfied (or waived in
writing by the Administrative Agent and each Lender).
"Commitment" shall mean, with respect to any Lender at any time, the amount
set forth opposite such Lender's name on its signature page hereto under the
caption "Commitment" or, if such Lender has entered into one or more Assignment
and Acceptances (or a Joinder Agreement pursuant to Section 2.20), the amount
set forth for such Lender at such time in the Register maintained by the
Administrative Agent pursuant to Section 10.7(b) as such Lender's "Commitment,"
as such amount may be increased at or prior to such time pursuant to Section
2.20 or reduced at or prior to such time pursuant to the terms hereof.
"Compliance Certificate" shall mean a fully completed and duly executed
certificate in the form of Exhibit C, together with a Covenant Compliance
Worksheet.
"Consolidated Indebtedness" shall mean, at any time, the aggregate (without
duplication) of all Indebtedness of the Borrower and its Subsidiaries as of such
date, determined on a consolidated basis in accordance with GAAP but excluding
(i) reimbursement obligations of the Borrower or its Subsidiaries with respect
to letters of credit that have been collateralized in full, and (ii) any
Indebtedness of any Subsidiary that is an Excluded Subsidiary as of such date.
"Consolidated Interest Expense" shall mean, for any period for any Person,
Interest Expense for such Person and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Income" shall mean, for any 12-month period, the net
income (or loss) of the Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP; provided, however,
that for purposes of Section 6.2(b)(i) the Consolidated Net Income shall be
deemed to be zero for any period for which such net income (loss) of Borrower
and its Subsidiaries is a loss.
"Consolidated Net Worth" shall mean, at any time, the shareholders' equity
of the Borrower and its Subsidiaries at such time, determined on a consolidated
basis in accordance
5
with GAAP but adjusted as follows: (a)(i) minus, to the extent not already
included as a liability in calculating such net worth, any Disqualified Capital
Stock, (ii) minus, any such net worth attributable to Excluded Subsidiaries, and
(iii) plus, solely for purposes of calculating the Leverage Ratio on any date,
to the extent included as a liability in calculating such net worth, the
aggregate outstanding amount (without duplication) of any Qualified Debt
Obligations (but not any Qualified Debt Obligation that is also Disqualified
Capital Stock); provided however, that the amount, if any, added back pursuant
to this clause (a)(iii) on any date shall not exceed 15% of the sum of
Consolidated Indebtedness on such date plus Consolidated Net Worth on such date;
and (b) without regard to the requirements of Statement of Financial Accounting
Standards Nos. 52 and 115 issued by the Financial Accounting Standards Board.
"Consolidated Total Assets" shall mean, at any time, the aggregate (without
duplication) of all assets of the Borrower and its Subsidiaries that are
required to be included on the asset side of the consolidated balance sheet of
the Borrower and its Subsidiaries at such time, determined on a consolidated
basis in accordance with GAAP.
"Contingent Obligation" shall mean, with respect to any Person, without
duplication, any obligation, contingent or otherwise, of any such Person
pursuant to which such Person has directly or indirectly guaranteed any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of any such Person (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or other obligation (whether
arising by virtue of partnership arrangements, by agreement to keep well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement condition or otherwise) or (b) entered into for the purpose
of assuring in any other manner the obligee of such Indebtedness or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Contingent
Obligation shall not include (i) obligations under insurance or reinsurance
policies, or (ii) endorsements for collection or deposit in the ordinary course
of business. For purposes of clause (a) above, the Contingent Obligations of any
Person shall include the Indebtedness of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company)
in which such Person is a general partner or joint venturer, unless such
Indebtedness is expressly made non-recourse to such Person.
"Covenant Compliance Worksheet" shall mean a fully completed worksheet in
the form of Attachment A to Exhibit C.
"Credit Documents" shall mean this Agreement, the Notes, the Fee Letter,
and all other agreements, instruments, documents and certificates now or
hereafter executed and delivered to the Administrative Agent or any Lender by or
on behalf of the Borrower or any of its Subsidiaries with respect to this
Agreement and the transactions contemplated hereby, in each case as amended,
modified, supplemented or restated from time to time.
"Debt Service" shall mean, for any period for any Person, the aggregate
(without duplication) of all principal and Interest Expense required to be paid
in cash by such Person during such period in respect of Indebtedness; provided,
however, that Debt Service shall not include any principal required to be paid
by such Person with respect to the ▇▇▇▇▇▇ Senior Notes.
6
"Default" shall mean any event or condition that, with the passage of time
or giving of notice, or both, would constitute an Event of Default.
"Disqualified Capital Stock" shall mean, with respect to any Person, any
Capital Stock of such Person that, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable), or upon the
happening of any event or otherwise, (i) matures or is mandatorily redeemable or
subject to any mandatory repurchase requirement, pursuant to a sinking fund
obligation or otherwise, (ii) is redeemable or subject to any mandatory
repurchase requirement at the sole option of the holder thereof, or (iii) is
convertible into or exchangeable for (whether at the option of the issuer or the
holder thereof) (a) debt securities or (b) any Capital Stock referred to in (i)
or (ii) above, in each case under (i), (ii) or (iii) above at any time on or
prior to the date which is 95 days immediately following the Maturity Date;
provided, however, that only the portion of Capital Stock that so matures or is
mandatorily redeemable for cash, is so redeemable at the option of the holder
thereof, or is so convertible or exchangeable on or prior to such date shall be
deemed to be Disqualified Capital Stock; and provided, further that if the
Borrower, at its option, may settle any payment upon such maturity or redemption
by issuing common shares of the Borrower in lieu of a cash payment of such
amount then such Capital Stock shall not be deemed to be Disqualified Capital
Stock.
"Dollars" or "$" shall mean, unless otherwise qualified, dollars in lawful
currency of the United States.
"Eligible Assignee" shall mean (i) a commercial bank organized under the
laws of the United States or any state thereof and having combined capital and
surplus in excess of $500,000,000, (ii) a commercial bank organized under the
laws of any other country that is a member of the Organization for Economic
Cooperation and Development or any successor thereto (the "OECD") or a political
subdivision of any such country and having combined capital and surplus in
excess of $1,000,000,000, provided that such bank or other financial institution
is acting through a branch or agency located in the United States, in the
country under the laws of which it is organized or in another country that is
also a member of the OECD, (iii) the central bank of any country that is a
member of the OECD, (iv) a finance company or other financial institution or
fund that is engaged in making, purchasing or otherwise investing in loans in
the ordinary course of its business and having total assets in excess of
$500,000,000, or (v) any other Person approved by the Required Lenders, which
approval of the Required Lenders shall not be unreasonably withheld, and the
Borrower (provided that the Borrower's consent shall not be required in the
event a Default or Event of Default shall have occurred and be continuing).
"Eligible Investments" shall mean, for any Person, the securities owned by
such Person that are (a) traded on a recognized United States or United Kingdom
stock exchange or other financial market in a sufficiently active manner to
enable daily ▇▇▇▇-to-market accounting or (b) identified by a number using the
Committee on Uniform Securities Identification Procedures (CUSIP) or the CUSIP
International Numbering System (CINS) and which are valued on a daily basis by a
nationally recognized valuation service (which is not an Affiliate of the
Borrower) in the ordinary course of business to enable ▇▇▇▇-to-market
accounting, but in any case excluding real estate investments (other than
publicly-traded real estate investment trusts), investments in Affiliates of
such Person, private placements and other similar securities (other than
privately placed securities described under clause (b) above that are readily
transferable in compliance
7
with the Securities Exchange Act of 1933, as amended, and/or the rules and
regulations promulgated thereunder).
"Employee Benefit Plan" shall mean any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of the
Borrower or any ERISA Affiliate or (b) has at any time within the preceding six
years been maintained for the employees of the Borrower or any current or former
ERISA Affiliate.
"Environmental Laws" shall mean any and all federal, state and local laws,
statutes, ordinances, rules, regulations, permits, licenses, approvals,
interpretations and orders of any court or Governmental Authority, relating to
the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials. Environmental
Laws include, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 9601 et seq.), the Hazardous
Material Transportation Act (49 U.S.C. Section 331 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the Federal
Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act
(42 U.S.C. Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
Section 2601 et seq.), the Safe Drinking Water Act (42 U.S.C. Section 300 et
seq.), the Environmental Protection Agency's regulations relating to underground
storage tanks (40 C.F.R. Parts 280 and 281), and the Occupational Safety and
Health Act (29 U.S.C. Section 651 et seq.), analogous state statutes, and the
rules and regulations promulgated under the foregoing, as such statutes, rules
and regulations are amended or modified from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, each as amended or modified from time to
time.
"ERISA Affiliate" shall mean any Person who together with the Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Internal Revenue Code or Section 4001(b) of ERISA.
"Event of Default" shall have the meaning given to such term in Section
8.1.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute, and all rules and regulations from
time to time promulgated thereunder.
"Excluded Subsidiary" shall mean any Subsidiary of the Borrower that (i) is
a Pledged Subsidiary, or (ii) is a Subsidiary of another Excluded Subsidiary.
"Existing Credit Agreement" shall mean the Credit Agreement, dated December
21, 1999, as amended by a First Amendment, dated as of February 4, 2000, a
Second Amendment, dated as of March 17, 2000, a Third Amendment, dated as of
August 2, 2000, a Fourth Amendment, dated as of March 23, 2001, and a Fifth
Amendment, dated as of May, 2003, by and among the Borrower, ▇▇▇▇▇▇ Holdings
Inc., as guarantor, the lenders referred to therein and First Union National
Bank, as agent.
8
"Federal Funds Rate" shall mean, for any period, a fluctuating per annum
interest rate (rounded upwards, if necessary, to the nearest 1/100 of one
percentage point) equal for each day during such period to the weighted average
of the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by the Administrative Agent.
"Federal Reserve Board" shall mean the Board of Governors of the Federal
Reserve System or any successor thereto.
"Fee Letter" shall mean the letter dated as of the date hereof from
SunTrust and accepted by the Borrower relating to certain fees payable by the
Borrower in respect of the transactions contemplated by this Agreement, as
amended, modified or supplemented from time to time.
"Financial Officer" shall mean, with respect to the Borrower, the chief
financial officer, vice president - finance, principal accounting officer,
treasurer or controller of the Borrower.
"GAAP" shall mean United States generally accepted accounting principles,
as set forth in the statements, opinions and pronouncements of the Accounting
Principles Board, the American Institute of Certified Public Accountants and the
Financial Accounting Standards Board, consistently applied and maintained, as in
effect from time to time (subject to the provisions of Section 1.2).
"Governmental Approvals" shall mean all authorizations, consents,
approvals, licenses, certificates of authority and exemptions of, registrations
and filings with, and reports to, all Governmental Authorities.
"Governmental Authority" shall mean any nation, province, state or
political subdivision thereof and any central bank thereof, and any government
or any Person exercising executive, legislative, regulatory or administrative
functions of or pertaining to government, and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by any of
the foregoing which acts in a governmental capacity.
"Hazardous Materials" shall mean any substances or materials (a) which are
or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human
health or the environment and are or become regulated by any Governmental
Authority, (c) the presence of which require investigation or remediation under
any Environmental Law or common law, (d) the discharge or emission or release of
which requires a permit or license under any Environmental Law or other
Governmental Approval, (e) which are deemed to constitute a nuisance or a
trespass or pose a health or safety hazard to persons or neighboring properties,
(f) which are materials consisting of underground or aboveground storage tanks,
whether empty, filled or partially filled with any substance, or (g) which
contain,
9
without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam
insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude
oil, nuclear fuel, natural gas or synthetic gas.
"Hedge Agreement" shall mean any Interest Rate Agreement or any other
agreement relating to a rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
"Indebtedness" shall mean, with respect to any Person at any date and
without duplication, the sum of the following calculated in accordance with
GAAP: (a) all liabilities, obligations and indebtedness for borrowed money,
including but not limited to obligations evidenced by bonds, debentures, notes
or other similar instruments of any such Person and, with respect to the
Borrower and its Subsidiaries, obligations incurred in connection with the
acquisition of Pledged Subsidiaries, (b) all obligations to pay the deferred
purchase price of property or services of any such Person (other than trade
payables due from such Person and arising in the ordinary course of business),
(c) all Capital Lease Obligations of such Person, (d) all Indebtedness of any
other Person secured by a Lien on any asset of any such Person regardless of
whether the Indebtedness shall have been assumed by such Person or is
nonrecourse to the credit of such Person, (e) all Contingent Obligations of any
such Person, (f) all obligations, contingent or otherwise, of any such Person
relating to the face amount of letters of credit, whether or not drawn, and
banker's acceptances issued for the account of any such Person (but excluding
any obligation relating to an undrawn letter of credit if the undrawn letter of
credit is issued in connection with (i) a liability for which a reserve has been
established by such Person or one of its Subsidiaries in accordance with GAAP or
(ii) obtaining or maintaining any license, permit or authorization to transact
insurance or reinsurance business in the ordinary course, including, without
limitation, to support the business of such Person at Lloyd's of London), (g)
all obligations incurred by any such Person pursuant to any Interest Rate
Agreements which are due and payable, (h) all Disqualified Capital Stock issued
by such Person, with the amount of Indebtedness represented by such Disqualified
Capital Stock being equal to the greater of its voluntary or involuntary
liquidation preference and its maximum fixed repurchase price, but excluding
accrued dividends, if any (for purposes hereof, the "maximum fixed repurchase
price" of any Disqualified Capital Stock that does not have a fixed repurchase
price shall be calculated in accordance with the terms of such Disqualified
Capital Stock as if such Disqualified Capital Stock were purchased on any date
on which Indebtedness shall be required to be determined pursuant to this
Agreement, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined reasonably and in good faith by the board of directors or other
governing body of the issuer of such Disqualified Capital Stock; provided,
however, that the term "Indebtedness" shall not include any Qualified Debt
Obligation that is not also Disqualified Capital Stock; provided, further, that
the amount of such Qualified Debt Obligations excluded from "Indebtedness" under
the immediately preceding proviso on any date shall not exceed 15% of the sum of
Consolidated Indebtedness on such date plus Consolidated Net Worth on such date.
10
"Insurance Subsidiary" shall mean a Subsidiary the ability of which to pay
dividends is regulated by an Insurance Regulatory Authority or that is otherwise
required thereby to be regulated with the Applicable Law of its jurisdiction of
domicile.
"Insurance Regulatory Authority" shall mean, with respect to any Insurance
Subsidiary, the insurance department or similar Governmental Authority charged
with regulating insurance companies or insurance holding companies, in its
jurisdiction of domicile and, to the extent that it has regulatory authority
over such Insurance Subsidiary, in each other jurisdiction in which such
Insurance Subsidiary conducts business or is licensed to conduct business.
"Interest Expense" shall mean, for any Person, the sum (without
duplication) of (i) total interest expense of such Person for such period in
respect of Indebtedness and Qualified Debt Obligations of such Person
(including, without limitation, all such interest expense accrued during such
period, whether or not actually paid during such period), (ii) all net amounts
payable or receivable under or in respect of Interest Rate Agreements, to the
extent paid, received or accrued by such Person during such period, and (iii)
all commitment fees and other ongoing fees in respect of Indebtedness and
Qualified Debt Obligations paid or accrued by such Person during such period.
"Interest Period" shall have the meaning given to such term in Section
2.10.
"Interest Rate Agreement" shall mean any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and any successor statute, and all rules and
regulations from time to time promulgated thereunder.
"Joinder Agreement" shall mean a Joinder Agreement entered into pursuant to
Section 2.20 among an Eligible Assignee, the Borrower and the Administrative
Agent in substantially the form of Exhibit D-2.
"LIBOR Loan" shall mean, at any time, any Loan that bears interest at such
time at the Adjusted LIBOR Rate.
"LIBOR Rate" shall mean, with respect to each LIBOR Loan comprising part of
the same Borrowing for any Interest Period, an interest rate per annum obtained
by dividing (i)(y) the rate of interest (rounded upward, if necessary, to the
nearest 1/16 of one percentage point) appearing on that page of the Reuters,
Telerate or Bloombergs reporting service (as then being used by the
Administrative Agent to obtain such interest rate quotes) that displays British
Bankers' Association Interest Settlement Rates for deposits in Dollars for a
period equal to such Interest Period or if such page or such service shall cease
to be available, such other page or service (as the case may be) for the purpose
of displaying British Bankers' Association Interest Settlement Rates as
reasonably determined by the Administrative Agent upon advising the Borrower as
to the use of any such other service or (z) if the Administrative Agent
determines that the relevant foregoing sources are unavailable for the relevant
Interest Period, the rate of interest determined by the Administrative Agent to
be the rate or the arithmetic mean of rates (rounded upward, if
11
necessary, to the nearest 1/16 of one percentage point) at which Dollar deposits
in immediately available funds are being offered to first-tier banks in the
London interbank Eurodollar market, in each case under (y) and (z) above at
approximately 11:00 a.m., London time, two (2) Business Days prior to the first
day of such Interest Period for a period substantially equal to such Interest
Period and in an amount substantially equal to the amount of the LIBOR Loan
comprising part of such Borrowing, by (ii) the amount equal to 1.00 minus the
Reserve Requirement (expressed as a decimal) for such Interest Period.
"Lender" shall mean each financial institution signatory hereto and each
other financial institution that becomes a "Lender" hereunder pursuant to
Section 10.7, and their respective successors and assigns.
"Lending Office" shall mean, with respect to any Lender, the office of such
Lender designated as its "Lending Office" on its signature page hereto or in an
Assignment and Acceptance, or such other office as may be otherwise designated
in writing from time to time by such Lender to the Borrower and the
Administrative Agent. A Lender may designate separate Lending Offices as
provided in the foregoing sentence for the purposes of making or maintaining
different Types of Loans, and, with respect to LIBOR Loans, such office may be a
domestic or foreign branch or Affiliate of such Lender.
"Leverage Ratio" shall mean, as of any date, the ratio of (i) Consolidated
Indebtedness as of such date, to (ii) the sum of Consolidated Indebtedness plus
Consolidated Net Worth, each as of such date.
"Lien" shall mean, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind with respect to such asset.
For the purposes of this Agreement, a Person 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.
"Liquid Assets" shall mean, as of any date for any Person, the aggregate
(without duplication) fair market value of all cash, Cash Equivalents and
Eligible Investments of such Person as of such date that are not subject to any
Liens; provided, however, that the fair market value of the Eligible Investments
held by any Person as of such date shall be deemed to be the fair market value
of the Eligible Investments held by such Person as of the following date: (a) if
the date of determination is the last day of a calendar month or fiscal quarter,
as of such date of determination, and (b) if the date of determination is any
other day, as of the later of (i) the last day of the immediately preceding
calendar month or (ii) the day that is five (5) Business Days before the day of
the most recent Borrowing hereunder.
"Lloyd's of London" shall mean the Society of Lloyd's of London, the
Council of Lloyd's of London, or any other Person similarly associated with
Lloyd's of London.
"Lloyd's Syndicate" shall mean a syndicate of Lloyd's of London
underwriters that is registered with the Financial Services Authority.
"Loans" shall have the meaning given to such term in Section 2.1.
12
"Local Time" shall mean local time in Atlanta, Georgia.
"Margin Stock" shall have the meaning given to such term in Regulation U.
"▇▇▇▇▇▇ Senior Notes" shall mean the notes of the Borrower which mature
November 1, 2003, issued in the initial principal amount of $100,000,000
pursuant to the Indenture, dated as of October 26, 1993, between the Borrower
and the Chase Manhattan Bank (National Association), of which $67,013,000 in
principal amount remain outstanding as of the date hereof.
"Material Adverse Change" shall mean a material adverse change in the
condition (financial or otherwise), results of operations, business or assets of
the Borrower and its Subsidiaries, taken as a whole, other than (a) any changes
solely in the market price of the shares of common stock of the Borrower or (b)
any changes resulting from (i) changes in general economic conditions, (ii)
changes in the market level of investment portfolios, and (iii) changes
affecting the property and casualty insurance industry in general.
"Material Adverse Effect" shall mean a material adverse effect upon (i) the
condition (financial or otherwise), results of operations, business or assets of
the Borrower and its Subsidiaries, taken as a whole, (ii) the ability of the
Borrower or any Subsidiary to perform its obligations under this Agreement or
any of the other Credit Documents to which it is a party or (iii) the legality,
validity or enforceability of this Agreement or any of the other Credit
Documents or the rights and remedies of the Administrative Agent and the Lenders
hereunder and thereunder.
"Material Contract" shall mean (a) any contract or other agreement, written
or oral, of the Borrower or any of its Subsidiaries involving monetary liability
of or to any such Person in an amount in excess of the Threshold Amount, or (b)
any other contract or agreement, written or oral, of the Borrower or any of its
Subsidiaries the failure to comply with which could reasonably be expected to
have a Material Adverse Effect; provided that the term Material Contract shall
not include any insurance or reinsurance policy or contract.
"Material Insurance Subsidiary" shall mean an Insurance Subsidiary that is
a Material Subsidiary.
"Material Pension Plan" shall mean a Pension Plan or Pension Plans having
Unfunded Liabilities in excess of the Threshold Amount.
"Material Subsidiary" shall mean at all times, any Subsidiary of the
Borrower (other than any Excluded Subsidiary or any other Subsidiary at any time
the Capital Stock of which subsequently becomes subject to a Stock Acquisition
Lien within six months following the date on which it is organized by the
Borrower or a Subsidiary of the Borrower or becomes a Subsidiary of the Borrower
pursuant to an Acquisition; provided, that, at all times prior to the time such
Capital Stock is so encumbered such Subsidiary shall have been treated by the
Borrower and its other Subsidiaries as an Excluded Subsidiary for purposes of
Section 7.5) (i) whose assets (excluding intercompany accounts) are in excess of
ten percent (10%) of the total assets of the Borrower and its Subsidiaries, (ii)
to which ten percent (10%) or more of the gross revenues of the Borrower and its
Subsidiaries are attributable, or (iii) to which ten percent (10%) or more of
the net income of the Borrower and its Subsidiaries are attributable, in each
13
case determined on a consolidated basis in accordance with GAAP as of (and, with
respect to gross revenues and net income, for the period of four fiscal quarters
ending on) the last day of the fiscal quarter then most recently ended for which
financial statements and a Covenant Compliance Worksheet have been delivered
pursuant to Section 5.1 and Section 5.3.
"Maturity Date" shall mean December 31, 2006.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making, is accruing an obligation to make or has made contributions within the
preceding six years.
"NAIC" shall mean the National Association of Insurance Commissioners and
any successor thereto.
"Non U.S. Insurance Subsidiary" shall mean ▇▇▇▇▇▇ International Insurance
Company Limited, ▇▇▇▇▇▇ Capital Ltd., Terra Nova (Bermuda) Insurance Company
Ltd. and each other Insurance Subsidiary (other than any U.S. Insurance
Subsidiary).
"Notes" shall mean the promissory notes of the Borrower in substantially
the form of Exhibit A, together with any amendments, modifications and
supplements thereto, substitutions therefor and restatements thereof.
"Notice of Borrowing" shall have the meaning given to such term in Section
2.2(b).
"Notice of Conversion/Continuation" shall have the meaning given to such
term in Section 2.11(b).
"Obligations" shall mean all principal of and interest (including, to the
greatest extent permitted by law, post-petition interest) on the Loans and all
fees, expenses, indemnities and other obligations owing, due or payable at any
time by the Borrower to the Administrative Agent, any Lender, or any other
Person entitled thereto, under this Agreement or any of the other Credit
Documents.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Participant" shall have the meaning given to such term in Section 10.7(d).
"Pension Plan" shall mean any Employer Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or
Section 412 of the Internal Revenue Code and which (a) is maintained for
employees of the Borrower or any ERISA Affiliates or (b) has at any time within
the preceding six years been maintained for the employees of the Borrower or any
of its current or former ERISA Affiliates.
"Permitted Indebtedness" shall have the meaning given to such term in
Section 7.1.
"Person" shall mean an individual, corporation, partnership, limited
liability company, association, trust, business trust, joint venture, joint
stock company, pool, syndicate, sole
14
proprietorship, unincorporated organization, Governmental Authority or any other
form of entity or group thereof specifically listed herein.
"Pledged Subsidiary" shall mean a Subsidiary of the Borrower, any of the
Capital Stock of which is subject to a Stock Acquisition Lien or any other Lien.
"Pro Rata Share" shall mean, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Aggregate Commitments at
such time; provided that if the Commitment of each Lender to make Loans has been
terminated pursuant to Section 8.2, then the Pro Rata Share of each Lender shall
be determined based on the Pro Rata Share of such Lender immediately prior to
such termination and after giving effect to any subsequent assignments made
pursuant to the terms hereof.
"Qualified Debt Obligations" shall mean, without duplication, (a)
Indebtedness securities of a Person that (i) permit the deferral of principal
and interest payments for a period of up to five years (but not beyond the
maturity date), as elected by such Person, (ii) have a maturity for payment of
principal of not less than ten (10) years after the date of issuance, and (iii)
include provisions making the Indebtedness thereunder expressly subordinate to
all other Indebtedness of such Person; (b) preferred securities issued by a
Subsidiary, the sole purpose of which is to issue such preferred securities and
invest the proceeds thereof in Indebtedness securities of the type described in
clause (a) above, and which preferred securities are payable solely out of the
proceeds of payments on account of such Indebtedness securities; (c) the
obligations recorded on the consolidated balance sheet of such Person and its
Subsidiaries with respect to Indebtedness securities of the type described in
clause (a) above and preferred securities of the type described in clause (b)
above; (d) Indebtedness evidenced by the Borrower's Liquid Yield Option Notes
which mature June 5, 2031; and (e) any Indebtedness securities of the Borrower
in respect of which the Borrower may, at Borrower's option, satisfy any
principal payment, redemption or repurchase obligation by issuing common shares
of the Borrower in lieu of a cash payment of such amount.
"Qualified Trust" shall mean any statutory business trust, all of the
common securities of which are owned by the Borrower, that is the issuer of
Qualified Debt Obligations and that holds as its sole assets Indebtedness
securities described in clause (a) of the definition of Qualified Debt
Obligations.
"Quarterly Statement" shall mean, with respect to any Insurance Subsidiary,
the statutory quarterly financial statement of such Insurance Subsidiary as is
required to be filed with the applicable Governmental Authority of its
jurisdiction of domicile, with all exhibits and schedules filed therewith.
"Register" shall have the meaning given to such term in Section 10.7(b).
"Regulations D, T, U and X" shall mean Regulations D, T, U and X,
respectively, of the Federal Reserve Board, and any successor regulations.
15
"Reinsurance Agreement" shall mean a reinsurance, coinsurance, excess
insurance, ceding of insurance, assumption of insurance or indemnification or
similar arrangement with respect to insurance.
"Required Lenders" shall mean the Lenders holding outstanding Loans and
Unutilized Commitments (or, after the termination of the Commitments,
outstanding Loans) representing more than fifty-one percent (51%) of the
aggregate at such time of all outstanding Loans and Unutilized Commitments (or,
after the termination of the Commitments, the aggregate at such time of all
outstanding Loans).
"Reserve Requirement" shall mean, with respect to any Interest Period, the
aggregate of the maximum reserve percentages (including, without limitation, any
emergency, supplemental, special or other marginal reserves) (expressed as a
decimal) in effect from time to time during such Interest Period, as provided by
the Federal Reserve Board, applied for determining the maximum reserve
requirements (including, without limitation, basic, supplemental, marginal and
emergency reserves) applicable to SunTrust under Regulation D with respect to
"Eurocurrency liabilities" within the meaning of Regulation D, or under any
similar or successor regulation with respect to Eurocurrency liabilities or
Eurocurrency funding. The Reserve Requirement shall be adjusted automatically on
and as of the effective date of any change in any reserve percentage.
"Responsible Officer" shall mean, with respect to the Borrower, the
president, the chief executive officer, the chief financial officer, any
executive officer, or any other Financial Officer of the Borrower, and any other
officer or similar official thereof responsible for the administration of the
obligations of such Person in respect of this Agreement.
"Restricted Margin Stock" shall mean Margin Stock owned by the Borrower or
any Subsidiary which represents not more than 33-1/3% of the aggregate value
(determined in accordance with Regulation U), on a consolidated basis, of the
property and assets of the Borrower and its Subsidiaries (other than any Margin
Stock) that is subject to the provisions of Sections 7.2 and 7.3.
"Sale-Leaseback Transaction" shall mean any arrangement under which the
Borrower or any Subsidiary sells or transfers any of the real estate or other
fixed assets then owned by it and thereupon or within one year thereafter the
Borrower or any Subsidiary rents or leases the assets so sold or transferred.
"SAP" shall mean, with respect to any Insurance Subsidiary, the statutory
accounting practices prescribed or permitted by the relevant Insurance
Regulatory Authority of its jurisdiction of domicile, consistently applied and
maintained and in conformity with those used in the preparation of the most
recent statutory financial statements described in Section 4.15(b) (except where
changes are required by the relevant Insurance Regulatory Authority).
"SEC" shall mean the Securities and Exchange Commission or any successor
thereto.
"Statutory Capital and Surplus" shall mean, as to any Insurance Subsidiary,
the "surplus as regards policyholders" as of the end of each of its fiscal
quarters, as reported on line 35, column 1, page 3 of the Annual Statement of
such Insurance Subsidiary in the case of calculations made as of the last day of
any fiscal year of such Insurance Subsidiary (or, with
16
respect to any ▇▇▇-▇.▇.▇▇▇▇▇▇▇▇▇ Subsidiary, such other line, column or page of
the Annual Statement as appropriate), or as determined in a consistent manner
for any date other than one of which an Annual Statement is prepared.
"Stock Acquisition Lien" shall mean (i) any mortgage, pledge,
hypothecation, lien, encumbrance, charge or security interest of any kind upon
any Capital Stock of any Subsidiary of the Borrower acquired after the date
hereof, if such Stock Acquisition Lien is given for the purpose of financing,
and does not exceed, the cost to the Borrower or any Subsidiary of acquiring the
Capital Stock or property of the acquired Insurance Subsidiary and such
financing is effected concurrently with, or within six months after, the date of
such acquisition, and (ii) any extension, renewal or refinancing of any such
Stock Acquisition Lien as long as the principal amount of obligations secured
thereby does not exceed the principal amount of obligations secured immediately
prior to such extension, renewal or refinancing.
"Subsidiary" shall mean as to any Person, any corporation, partnership or
other entity of which more than fifty percent (50%) of the outstanding Capital
Stock having ordinary voting power to elect a majority of the board of directors
or other managers of such corporation, partnership or other entity is at the
time, directly or indirectly, owned by or the management is otherwise controlled
by such Person (irrespective of whether, at the time, capital stock of any other
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency). When used without reference to a
parent entity, the term "Subsidiary" shall be deemed to refer to a Subsidiary of
the Borrower.
"SunTrust" shall have he meaning given to such term in the preamble.
"Termination Date" shall mean the Maturity Date or such earlier date of
termination of the Commitments pursuant to Section 2.5 or Section 8.2.
"Termination Event" shall mean (a) a "Reportable Event" described in
Section 4043 of ERISA which is required to be reported to the PBGC and which is
likely to result in an unfunded liability to the Borrower or any ERISA Affiliate
in excess of the Threshold Amount, or (b) the withdrawal of the Borrower or any
ERISA Affiliate from a Pension Plan during a plan year in which it was a
"substantial employer" as defined in Section 4001(a)(2) of ERISA and which is
likely to result in an unfunded liability to the Borrower or any ERISA Affiliate
in excess of the Threshold Amount, or (c) the termination of a Material Pension
Plan, the filing of a notice of intent to terminate a Material Pension Plan or
the treatment of a Material Pension Plan amendment as a termination under
Section 4041 of ERISA, or (d) the institution of proceedings to terminate, or
the appointment of a trustee with respect to, any Pension Plan by the PBGC, or
(e) any other event or condition which would constitute grounds under Section
4042(a) of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan, or (f) the partial or complete withdrawal of the
Borrower or any ERISA Affiliate from a Multiemployer Plan and the plan sponsor
notifies the Borrower or ERISA Affiliate that the Borrower or ERISA Affiliate
has incurred a withdrawal liability requiring payment in excess of the Threshold
Amount, or (g) the imposition of a Lien pursuant to Section 412 of the Internal
Revenue Code or Section 302 of ERISA, or (h) any event or condition which
results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA and which is likely to result in an unfunded
liability to the Borrower or any ERISA Affiliate in
17
excess of the Threshold Amount, or (i) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by the PBGC of proceedings to terminate a Multiemployer Plan under
Section 4042 of ERISA and which is likely to result in an unfunded liability to
the Borrower or any ERISA Affiliate in excess of the Threshold Amount.
"Threshold Amount" means $50,000,000.
"Transactions" shall mean, the transactions contemplated by this Agreement
and the other Credit Documents, including (i) the making of the Loans, and (ii)
the payment of the fees and expenses contemplated hereby and thereby.
"Type" shall have the meaning given to such term in Section 2.2.
"Unfunded Liabilities" shall mean, with respect to any Pension Plan at any
time, the amount, if any, by which (i) the value of all benefit liabilities
under such Pension Plan, determined on a plan termination basis using the
assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA,
exceeds (ii) the fair market value of all plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date for
such Pension Plan, but only to the extent that such excess represents a
potential liability of a member of the applicable ERISA group to the PBGC or any
other Person under Title IV of ERISA.
"Unrestricted Margin Stock" shall mean any Margin Stock owned by the
Borrower or any Subsidiary which is not Restricted Margin Stock.
"Unutilized Commitment" shall mean, with respect to any Lender at any time,
such Lender's Commitment at such time less the aggregate principal amount of all
Loans made by such Lender that are outstanding at such time.
"U.S. Insurance Subsidiaries" shall mean the Insurance Subsidiaries of the
Borrower that are organized under the laws of a State of the United States.
"Wholly-Owned" shall mean, with respect to a Subsidiary, a Subsidiary all
of the shares of Capital Stock of which are, directly or indirectly, owned or
controlled by the Borrower and/or one or more of its Wholly-Owned Subsidiaries.
1.2 Accounting Terms. Except as specifically provided otherwise in this
Agreement, all accounting terms used herein that are not specifically defined
shall have the meanings customarily given them in accordance with GAAP (or, to
the extent that such terms apply solely to any Insurance Subsidiary or if
otherwise expressly required, SAP). Notwithstanding anything to the contrary in
this Agreement, for purposes of calculation of the financial covenants set forth
in Article VII, all accounting determinations and computations hereunder shall
be made in accordance with GAAP or SAP, as applicable as in effect as of the
date of this Agreement applied on a basis consistent with the application used
in preparing the most recent financial statements of the Borrower referred to in
Section 4.15. In the event that any changes in GAAP or SAP after such date are
required to be applied to the Borrower and would affect the computation of the
financial covenants contained in Article VII, such changes shall be followed
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only from and after the date this Agreement shall have been amended to take into
account any such changes.
1.3 Other Terms; Construction. Unless otherwise specified or unless the
context otherwise requires, all references herein to sections, annexes,
schedules and exhibits are references to sections, annexes, schedules and
exhibits in and to this Agreement, and all terms defined in this Agreement shall
have the defined meanings when used in any other Credit Document or any
certificate or other document made or delivered pursuant hereto. All references
herein to the Lenders or any of them shall be deemed to include the Lender
unless specifically provided otherwise or unless the context otherwise requires.
ARTICLE II
AMOUNT AND TERMS OF THE LOANS
2.1 Commitments. Each Lender severally agrees, subject to and on the
terms and conditions of this Agreement, to make loans (each, a "Loan," and
collectively, the "Loans") to the Borrower, from time to time on any Business
Day during the period from and including the Closing Date to but not including
the Termination Date, in an aggregate principal amount at any time outstanding
not greater than its Commitment at such time, provided that no Borrowing of
Loans shall be made at any time, if, immediately after giving effect thereto,
the aggregate principal amount of Loans outstanding at such time would exceed
either (a) the aggregate Commitments at such time or (b) except in the case of a
Borrowing the proceeds of which will be solely applied to repay the ▇▇▇▇▇▇
Senior Notes, the aggregate Commitments at such time minus the aggregate
principal amount outstanding under the ▇▇▇▇▇▇ Senior Notes at such time. Subject
to and on the terms and conditions of this Agreement, the Borrower may borrow,
repay and reborrow Loans.
2.2 Borrowings.
(a) The Loans shall, at the option of the Borrower and subject to the
terms and conditions of this Agreement, be either Base Rate Loans or LIBOR Loans
(each, a "Type" of Loan), provided that all Loans comprising the same Borrowing
shall, unless otherwise specifically provided herein, be of the same Type.
(b) In order to make a Borrowing (other than Borrowings involving
continuations or conversions of outstanding Loans, which shall be made pursuant
to Section 2.11), the Borrower will give the Administrative Agent written notice
not later than 11:00 a.m., Local Time, three (3) Business Days prior to each
Borrowing to be comprised of LIBOR Loans and one (1) Business Day prior to each
Borrowing to be comprised of Base Rate Loans; provided, however, that requests
for the Borrowing of any Loans to be made on the Closing Date may, at the
discretion of the Administrative Agent, be given later than the times specified
hereinabove. Each such notice (each, a "Notice of Borrowing") shall be
irrevocable, shall be given in the form of Exhibit B-1 and shall specify (1) the
aggregate principal amount and initial Type of the Loans to be made pursuant to
such Borrowing, (2) in the case of a Borrowing of LIBOR Loans, the initial
Interest Period to be applicable thereto, and (3) the requested date of such
Borrowing (the "Borrowing Date"), which shall be a Business Day. Upon its
receipt of a Notice of Borrowing,
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the Administrative Agent will promptly notify each Lender of the proposed
Borrowing. Notwithstanding anything to the contrary contained herein:
(i) the aggregate principal amount of each Borrowing comprised of
Base Rate Loans shall not be less than $1,000,000 or, if greater, an
integral multiple of $500,000 in excess thereof (or, if less, in the amount
of the aggregate Unutilized Commitments), and the aggregate principal
amount of each Borrowing comprised of LIBOR Loans shall not be less than
$5,000,000 or, if greater, an integral multiple of $1,000,000 in excess
thereof;
(ii) if the Borrower shall have failed to designate the Type of
Loans comprising a Borrowing, the Borrower shall be deemed to have
requested a Borrowing comprised of Base Rate Loans; and
(iii) if the Borrower shall have failed to select the duration of
the Interest Period to be applicable to any Borrowing of LIBOR Loans, then
the Borrower shall be deemed to have selected an Interest Period with a
duration of one month.
(c) Not later than 1:00 p.m., Local Time, on the requested Borrowing
Date, each Lender will make available to the Administrative Agent at its office
referred to in Section 10.5 (or at such other location as the Administrative
Agent may designate) an amount, in Dollars and in immediately available funds,
equal to the amount of the Loan to be made by such Lender. To the extent the
Lenders have made such amounts available to the Administrative Agent as provided
hereinabove, the Administrative Agent will make the aggregate of such amounts
available to the Borrower in accordance with Section 2.3(a) and in like funds as
received by the Administrative Agent.
2.3 Disbursements; Funding Reliance; Domicile of Loans.
(a) The Borrower hereby authorizes the Administrative Agent to disburse
the proceeds of each Borrowing in accordance with the terms of any written
instructions from any of the Authorized Officers, provided that the
Administrative Agent shall not be obligated under any circumstances to forward
amounts to any account not listed in an Account Designation Letter. The Borrower
may at any time deliver to the Administrative Agent an Account Designation
Letter listing any additional accounts or deleting any accounts listed in a
previous Account Designation Letter.
(b) Unless the Administrative Agent has received, prior to 1:00 p.m.,
Local Time, on the relevant Borrowing Date, written notice from a Lender that
such Lender will not make available to the Administrative Agent such Lender's
ratable portion of the relevant Borrowing, the Administrative Agent may assume
that such Lender has made such portion available to the Administrative Agent in
immediately available funds on such Borrowing Date in accordance with the
applicable provisions of Section 2.2, and the Administrative Agent may, in
reliance upon such assumption, but shall not be obligated to, make a
corresponding amount available to the Borrower on such Borrowing Date. If and to
the extent that such Lender shall not have made such portion available to the
Administrative Agent, and the Administrative Agent shall have made such
corresponding amount available to the Borrower, such Lender, on the one hand,
and
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the Borrower, on the other, severally agree to pay 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 the Borrower until
the date such amount is repaid to the Administrative Agent, (i) in the case of
such Lender, at the Federal Funds Rate, and (ii) in the case of the Borrower, at
the rate of interest applicable at such time to the Type of Loans comprising
such Borrowing, as determined under the provisions of Section 2.8. If such
Lender shall repay to the Administrative Agent such corresponding amount, such
amount shall constitute such Lender's Loan as part of such Borrowing for
purposes of this Agreement. The failure of any Lender to make any Loan required
to be made by it as part of any Borrowing shall not relieve any other Lender of
its obligation, if any, hereunder to make its Loan as part of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Loan to be made by such other Lender as part of any Borrowing.
(c) Each Lender may, at its option, make and maintain any Loan at, to or
for the account of any of its Lending Offices, provided that any exercise of
such option shall not affect the obligation of the Borrower to repay such Loan
to or for the account of such Lender in accordance with the terms of this
Agreement.
2.4 Notes.
(a) The Loans made by each Lender shall be evidenced by a Note
appropriately completed in substantially the form of Exhibit A.
(b) Each Note issued to a Lender shall (i) be executed by the Borrower,
(ii) be payable to the order of such Lender, (iii) be dated as of the Closing
Date (or, in the case of a Note issued after the Closing Date, dated the
effective date of the applicable Assignment and Acceptance), (iv) be in a stated
principal amount equal to such Lender's Commitment, (v) bear interest in
accordance with the provisions of Section 2.8, as the same may be applicable
from time to time to the Loans made by such Lender, and (vi) be entitled to all
of the benefits of this Agreement and the other Credit Documents and subject to
the provisions hereof and thereof.
(c) Each Lender will record on its internal records the amount and Type
of each Loan made by it and each payment received by it in respect thereof and
will, in the event of any transfer of any of its Notes, either endorse on the
reverse side thereof or on a schedule attached thereto (or any continuation
thereof) the outstanding principal amount and Type of the Loans evidenced
thereby as of the date of transfer or provide such information on a schedule to
the Assignment and Acceptance relating to such transfer; provided, however, that
the failure of any Lender to make any such recordation or provide any such
information, or any error therein, shall not affect the Borrower's obligations
under this Agreement or the Notes.
2.5 Termination and Reduction of Commitments.
(a) The Commitments shall be automatically and permanently terminated on
the Termination Date.
(b) At any time and from time to time after the date hereof, upon not
less than five (5) Business Days' prior written notice to the Administrative
Agent, the Borrower may terminate in whole or reduce in part the aggregate
Unutilized Commitments, provided that any such partial
21
reduction shall be in an aggregate amount of not less than $5,000,000 or, if
greater, an integral multiple thereof. The amount of any termination or
reduction made under this Section 2.5(c) may not thereafter be reinstated.
(c) Each reduction of the Commitments pursuant to this Section shall be
applied ratably among the Lenders according to their respective Commitments.
2.6 Mandatory Payments and Prepayments.
(a) Except to the extent due or paid sooner pursuant to the provisions of
this Agreement, the aggregate outstanding principal of the Loans shall be due
and payable in full on the Maturity Date.
(b) In the event that, at any time, the aggregate principal amount of
Loans outstanding at such time shall exceed the aggregate Commitments at such
time (after giving effect to any concurrent termination or reduction thereof),
the Borrower will immediately prepay the outstanding principal amount of the
Loans in the amount of such excess.
(c) Each prepayment of the Loans made pursuant to Section 2.6(b) shall be
applied first to prepay all Base Rate Loans before any LIBOR Loans are prepaid.
Each payment or prepayment pursuant to the provisions of this Section shall be
applied ratably among the Lenders holding the Loans being prepaid, in proportion
to the principal amount held by each.
(d) Each payment or prepayment of a LIBOR Loan made pursuant to the
provisions of this Section on a day other than the last day of the Interest
Period applicable thereto shall be made together with all amounts required under
Section 2.18 to be paid as a consequence thereof.
2.7 Voluntary Prepayments.
(a) At any time and from time to time, the Borrower shall have the right
to prepay the Loans, in whole or in part, without premium or penalty (except as
provided in clause (iii) below), upon written notice given to the Administrative
Agent not later than 11:00 a.m., Local Time, three (3) Business Days prior to
each intended prepayment of LIBOR Loans and one (1) Business Day prior to each
intended prepayment of Base Rate Loans, provided that (i) each partial
prepayment shall be in an aggregate principal amount of not less than $5,000,000
or, if greater, an integral multiple of $1,000,000 in excess thereof, (ii) no
partial prepayment of LIBOR Loans made pursuant to any single Borrowing shall
reduce the aggregate outstanding principal amount of the remaining LIBOR Loans
under such Borrowing to less than $5,000,000 or to any greater amount not an
integral multiple of $1,000,000 in excess thereof, and (iii) unless made
together with all amounts required under Section 2.18 to be paid as a
consequence of such prepayment, a prepayment of a LIBOR Loan may be made only on
the last day of the Interest Period applicable thereto. Each such notice shall
specify the proposed date of such prepayment and the aggregate principal amount
and Type of the Loans to be prepaid (and, in the case of LIBOR Loans, the
Interest Period of the Borrowing pursuant to which made), and shall be
irrevocable and shall bind the Borrower to make such prepayment on the terms
specified therein. Loans prepaid pursuant to this subsection (a) may be
reborrowed, subject to the terms and conditions of this Agreement.
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(b) Each prepayment of the Loans made pursuant to subsection (a) above
shall be applied ratably among the Lenders holding the Loans being prepaid, in
proportion to the principal amount held by each.
2.8 Interest.
(a) The Borrower will pay interest in respect of the unpaid principal
amount of each Loan, from the date of Borrowing thereof until such principal
amount shall be paid in full, (i) at the Base Rate, as in effect from time to
time during such periods as such Loan is a Base Rate Loan, and (ii) at the
Adjusted LIBOR Rate, as in effect from time to time during such periods as such
Loan is a LIBOR Loan.
(b) Upon the occurrence and during the continuance of any default by the
Borrower in the payment of any principal of or interest on any Loan, any fees or
other amount hereunder when due (whether at maturity, pursuant to acceleration
or otherwise), and (at the election of the Required Lenders) upon the occurrence
and during the continuance of any Event of Default, all outstanding principal
amounts of the Loans and, to the greatest extent permitted by law, all interest
accrued on the Loans and all other accrued and outstanding fees and other
amounts hereunder, shall bear interest at a rate per annum equal to the interest
rate applicable from time to time thereafter to such Loans (whether the Base
Rate or the Adjusted LIBOR Rate) plus 2% (or, in the case of fees and other
amounts, at the Base Rate plus 2%), and, in each case, such default interest
shall be payable on demand. To the greatest extent permitted by law, interest
shall continue to accrue after the filing by or against the Borrower of any
petition seeking any relief in bankruptcy or under any law pertaining to
insolvency or debtor relief.
(c) Accrued (and theretofore unpaid) interest shall be payable as
follows:
(i) in respect of each Base Rate Loan (including any Base Rate
Loan or portion thereof paid or prepaid pursuant to the provisions of
Section 2.6, except as provided hereinbelow), in arrears on the last
Business Day of each calendar quarter, beginning with the first such day to
occur after the Closing Date; provided, that in the event the Loans are
repaid or prepaid in full and the Commitments have been terminated, then
accrued interest in respect of all Base Rate Loans shall be payable
together with such repayment or prepayment on the date thereof;
(ii) in respect of each LIBOR Loan (including any LIBOR Loan or
portion thereof paid or prepaid pursuant to the provisions of Section 2.6,
except as provided hereinbelow), in arrears (y) on the last Business Day of
the Interest Period applicable thereto (subject to the provisions of clause
(iv) in Section 2.10 and (z) in addition, in the case of a LIBOR Loan with
an Interest Period having a duration of six months or longer, on each date
on which interest would have been payable under clause (y) above had
successive Interest Periods of three months' duration been applicable to
such LIBOR Loan; provided, that in the event all LIBOR Loans made pursuant
to a single Borrowing are repaid or prepaid in full, then accrued interest
in respect of such LIBOR Loans shall be payable together with such
repayment or prepayment on the date thereof; and
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(iii) in respect of any Loan, at maturity (whether pursuant to
acceleration or otherwise) and, after maturity, on demand.
(d) Nothing contained in this Agreement or in any other Credit Document
shall be deemed to establish or require the payment of interest to any Lender at
a rate in excess of the maximum rate permitted by Applicable Law. If the amount
of interest payable for the account of any Lender on any interest payment date
would exceed the maximum amount permitted by Applicable Law to be charged by
such Lender, the amount of interest payable for its account on such interest
payment date shall be automatically reduced to such maximum permissible amount.
In the event of any such reduction affecting any Lender, if from time to time
thereafter the amount of interest payable for the account of such Lender on any
interest payment date would be less than the maximum amount permitted by
Applicable Law to be charged by such Lender, then the amount of interest payable
for its account on such subsequent interest payment date shall be automatically
increased to such maximum permissible amount, provided that at no time shall the
aggregate amount by which interest paid for the account of any Lender has been
increased pursuant to this sentence exceed the aggregate amount by which
interest paid for its account has theretofore been reduced pursuant to the
previous sentence.
(e) The Administrative Agent shall promptly notify the Borrower and the
Lenders upon determining the interest rate for each Borrowing of LIBOR Loans
after its receipt of the relevant Notice of Borrowing or Notice of
Conversion/Continuation, and upon each change in the Base Rate; provided,
however, that the failure of the Administrative Agent to provide the Borrower or
the Lenders with any such notice shall neither affect any obligations of the
Borrower or the Lenders hereunder nor result in any liability on the part of the
Administrative Agent to the Borrower or any Lender. Each such determination
(including each determination of the Reserve Requirement) shall, absent manifest
error, be conclusive and binding on all parties hereto.
2.9 Fees. The Borrower agrees to pay:
(a) To the Administrative Agent for the account of each Lender, the fee
payable to such Lender on the Closing Date as separately agreed among the
Borrower, such Lender and the Administrative Agent
(b) To the Administrative Agent, for the account of each Lender, a
commitment fee for each calendar quarter (or portion thereof) for the period
from the earliest of the Closing Date to the Termination Date, at a per annum
rate equal to the Applicable Margin Percentage in effect for such fee from time
to time during such quarter on such Lender's ratable share (based on the
proportion that its Commitment bears to the aggregate Commitments) of the
average daily aggregate Unutilized Commitments, payable in arrears (i) on the
last Business Day of each calendar quarter, beginning with the first such day to
occur after the Closing Date, (ii) on the date of any increase in the Aggregate
Commitments pursuant to Section 2.20, and (iii) on the Termination Date;
(c) To the Administrative Agent, for its own account, the annual
administrative fee described in the Fee Letter, on the terms, in the amount and
at the times set forth therein.
24
2.10 Interest Periods. Concurrently with the giving of a Notice of
Borrowing or Notice of Conversion/Continuation in respect of any Borrowing
comprised of Base Rate Loans to be converted into, or LIBOR Loans to be
continued as, LIBOR Loans, the Borrower shall have the right to elect, pursuant
to such notice, the interest period (each, an "Interest Period") to be
applicable to such LIBOR Loans, which Interest Period shall, at the option of
the Borrower, be a one, two, three or six-month period; provided, however, that:
(i) all LIBOR Loans comprising a single Borrowing shall at all
times have the same Interest Period;
(ii) the initial Interest Period for any LIBOR Loan shall commence
on the date of the Borrowing of such LIBOR Loan (including the date of any
continuation of, or conversion into, such LIBOR Loan), and each successive
Interest Period applicable to such LIBOR Loan shall commence on the day on
which the next preceding Interest Period applicable thereto expires;
(iii) LIBOR Loans may not be outstanding under more than eight (8)
separate Interest Periods at any one time (for which purpose Interest
Periods shall be deemed to be separate even if they are coterminous);
(iv) if any Interest Period otherwise would expire on a day that
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day unless such next succeeding Business Day falls in
another calendar month, in which case such Interest Period shall expire on
the next preceding Business Day;
(v) the Borrower may not select any Interest Period that expires
after the Maturity Date; and
(vi) if any Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month during which such
Interest Period would otherwise expire, such Interest Period shall expire
on the last Business Day of such calendar month.
2.11 Conversions and Continuations.
(a) The Borrower shall have the right, on any Business Day occurring on
or after the Closing Date, to elect (i) to convert all or a portion of the
outstanding principal amount of any Base Rate Loans into LIBOR Loans, or to
convert any LIBOR Loans the Interest Periods for which end on the same day into
Base Rate Loans, or (ii) upon the expiration of any Interest Period, to continue
all or a portion of the outstanding principal amount of any LIBOR Loans the
Interest Periods for which end on the same day for an additional Interest
Period, provided that (x) any such conversion of LIBOR Loans into Base Rate
Loans shall involve an aggregate principal amount of not less than $1,000,000
or, if greater, an integral multiple of $500,000 in excess thereof; any such
conversion of Base Rate Loans into, or continuation of, LIBOR Loans shall
involve an aggregate principal amount of not less than $5,000,000 or, if
greater, an integral multiple of $1,000,000 in excess thereof; and no partial
conversion of LIBOR Loans made pursuant to a single Borrowing shall reduce the
outstanding principal amount of such LIBOR Loans to less than $5,000,000 or to
any greater amount not an integral multiple of $1,000,000 in
25
excess thereof, (y) except as otherwise provided in Section 2.16(d), LIBOR Loans
may be converted into Base Rate Loans only on the last day of the Interest
Period applicable thereto (and, in any event, if a LIBOR Loan is converted into
a Base Rate Loan on any day other than the last day of the Interest Period
applicable thereto, the Borrower will pay, upon such conversion, all amounts
required under Section 2.18 to be paid as a consequence thereof), and (z) no
conversion of Base Rate Loans into LIBOR Loans or continuation of LIBOR Loans
shall be permitted during the continuance of an Event of Default.
(b) The Borrower shall make each such election by giving the
Administrative Agent written notice not later than 11:00 a.m., Local Time, three
(3) Business Days prior to the intended effective date of any conversion of Base
Rate Loans into, or continuation of, LIBOR Loans and one (1) Business Day prior
to the intended effective date of any conversion of LIBOR Loans into Base Rate
Loans. Each such notice (each, a "Notice of Conversion/Continuation") shall be
irrevocable, shall be given in the form of Exhibit B-2 and shall specify (x) the
date of such conversion or continuation (which shall be a Business Day), (y) in
the case of a conversion into, or a continuation of, LIBOR Loans, the Interest
Period to be applicable thereto, and (z) the aggregate amount and Type of the
Loans being converted or continued. Upon the receipt of a Notice of
Conversion/Continuation, the Administrative Agent will promptly notify each
Lender of the proposed conversion or continuation. In the event that the
Borrower shall fail to deliver a Notice of Conversion/Continuation as provided
herein with respect to any outstanding LIBOR Loans, such LIBOR Loans shall
automatically be converted to Base Rate Loans upon the expiration of the then
current Interest Period applicable thereto (unless repaid pursuant to the terms
hereof). In the event the Borrower shall have failed to select in a Notice of
Conversion/Continuation the duration of the Interest Period to be applicable to
any conversion into, or continuation of, LIBOR Loans, then the Borrower shall be
deemed to have selected an Interest Period with a duration of one month.
2.12 Method of Payments; Computations.
(a) All payments by the Borrower hereunder shall be made without setoff,
counterclaim or other defense, in Dollars and in immediately available funds to
the Administrative Agent, for the account of the Lenders entitled to such
payment (except as otherwise expressly provided herein as to payments required
to be made directly to the Lenders) at its office referred to in Section 10.5,
prior to 2:00 p.m., Local Time, on the date payment is due. Any payment made as
required hereinabove, but after 2:00 p.m., Local Time, shall be deemed to have
been made on the next succeeding Business Day. If any payment falls due on a day
that is not a Business Day, then such due date shall be extended to the next
succeeding Business Day (except that in the case of LIBOR Loans to which the
provisions of clause (iv) in Section 2.10 are applicable, such due date shall be
the next preceding Business Day), and such extension of time shall then be
included in the computation of payment of interest, fees or other applicable
amounts.
(b) The Administrative Agent will distribute to the Lenders like amounts
relating to payments made to the Administrative Agent for the account of the
Lenders as follows: (i) if the payment is received by 2:00 p.m., Local Time, in
immediately available funds, the Administrative Agent will make available to
each relevant Lender on the same date, by wire transfer of immediately available
funds, such Lender's ratable share of such payment (based on
26
the percentage that the amount of the relevant payment owing to such Lender
bears to the total amount of such payment owing to all of the relevant Lenders),
and (ii) if such payment is received after 2:00 p.m., Local Time, or in other
than immediately available funds, the Administrative Agent will make available
to each such Lender its ratable share of such payment by wire transfer of
immediately available funds on the next succeeding Business Day (or in the case
of uncollected funds, as soon as practicable after collected). If the
Administrative Agent shall not have made a required distribution to the
appropriate Lenders as required hereinabove after receiving a payment for the
account of such Lenders, the Administrative Agent will pay to each such Lender,
on demand, its ratable share of such payment with interest thereon at the
Federal Funds Rate for each day from the date such amount was required to be
disbursed by the Administrative Agent until the date repaid to such Lender.
(c) Unless the Administrative Agent shall have received written notice
from the Borrower prior to the date on which any payment is due to any Lender
hereunder that such payment will not be made in full, the Administrative Agent
may assume that the Borrower has made such payment in full to the Administrative
Agent on such date, and the Administrative Agent may, in reliance on such
assumption, but shall not be obligated to, cause to be distributed to such
Lender on such due date an amount equal to the amount then due to such Lender.
If and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, and without limiting the obligation of the Borrower to
make such payment in accordance with the terms hereof, such Lender shall repay
to the Administrative Agent forthwith on demand such amount so distributed to
such Lender, together with interest thereon for each day from the date such
amount is so distributed to such Lender until the date repaid to the
Administrative Agent, at the Federal Funds Rate.
(d) All computations of interest and fees hereunder (including
computations of the Reserve Requirement) shall be made on the basis of the
actual number of days (including the first day but excluding the last day)
elapsed and a year consisting of (i) in the case of Base Rate Loans, 365 or 366
days, as the case may be, or (ii) in all other instances, 360 days.
2.13 Recovery of Payments.
(a) The Borrower agrees that to the extent the Borrower makes a payment
or payments to or for the account of the Administrative Agent or any Lender,
which payment or payments or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid to
a trustee, receiver or any other party under any bankruptcy, insolvency or
similar state or federal law, common law or equitable cause, then, to the extent
of such payment or repayment, the Obligation intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been
received.
(b) If any amounts distributed by the Administrative Agent to any Lender
are subsequently returned or repaid by the Administrative Agent to the Borrower
or its representative or successor in interest, whether by court order or by
settlement approved by the Lender in question, such Lender will, promptly upon
receipt of notice thereof from the Administrative Agent, pay the Administrative
Agent such amount. If any such amounts are recovered by the Administrative Agent
from the Borrower or its representative or successor in
27
interest, the Administrative Agent will redistribute such amounts to the Lenders
on the same basis as such amounts were originally distributed.
2.14 Use of Proceeds. The proceeds of the Loans shall be used for general
corporate purposes and in accordance with the terms and provisions of this
Agreement.
2.15 Pro Rata Treatment.
(a) All fundings, continuations and conversions of Loans shall be made by
the Lenders pro rata on the basis of their respective Commitments (in the case
of the initial funding of Loans pursuant to Section 2.2) or on the basis of
their respective outstanding Loans (in the case of continuations and conversions
of Loans pursuant to Section 2.11, and additionally in all cases in the event
the Commitments have expired or have been terminated), as the case may be from
time to time. All payments on account of principal of or interest on any Loans,
fees or any other Obligations owing to or for the account of any one or more
Lenders shall be apportioned ratably among such Lenders in proportion to the
amounts of such principal, interest, fees or other Obligations owed to them
respectively.
(b) Each Lender agrees that if it shall receive any amount hereunder
(whether by voluntary payment, realization upon security, exercise of the right
of setoff or banker's lien, counterclaim or cross action, or otherwise, other
than pursuant to Section 10.7) applicable to the payment of any of the
Obligations that exceeds its ratable share (according to the proportion of (i)
the amount of such Obligations due and payable to such Lender at such time to
(ii) the aggregate amount of such Obligations due and payable to all Lenders at
such time) of payments on account of such Obligations then or therewith obtained
by all the Lenders to which such payments are required to have been made, such
Lender shall forthwith purchase from the other Lenders such participations in
such Obligations as shall be necessary to cause such purchasing Lender to share
the excess payment or other recovery ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender, such purchase from each such other Lender
shall be rescinded and each such other Lender shall repay to the purchasing
Lender the purchase price to the extent of such recovery, together with an
amount equal to such other Lender's ratable share (according to the proportion
of (i) the amount of such other Lender's required repayment to (ii) the total
amount so recovered from the purchasing Lender) of any interest or other amount
paid or payable by the purchasing Lender in respect of the total amount so
recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to the provisions of this subsection may, to the
fullest extent permitted by law, exercise any and all rights of payment
(including, without limitation, setoff, banker's lien or counterclaim) with
respect to such participation as fully as if such participant were a direct
creditor of the Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or similar law, any Lender receives a secured
claim in lieu of a setoff to which this subsection applies, such Lender shall,
to the extent practicable, exercise its rights in respect of such secured claim
in a manner consistent with the rights of the Lenders entitled under this
subsection to share in the benefits of any recovery on such secured claim.
2.16 Increased Costs; Change in Circumstances; Illegality; etc.
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(a) If, at any time after the date hereof and from time to time, the
introduction of or any change in any Applicable Law or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by any Lender with any
guideline or request from any such Governmental Authority (whether or not having
the force of law), shall (i) subject such Lender to any tax or other charge, or
change the basis of taxation of payments to such Lender, in respect of any of
its LIBOR Loans or any other amounts payable hereunder or its obligation to
make, fund or maintain any LIBOR Loans (other than any change in the rate or
basis of tax on the overall net income of such Lender or its applicable Lending
Office), or (ii) impose, modify or deem applicable any reserve, special deposit
or similar requirement (but excluding any reserves to the extent actually
included within the Reserve Requirement in the calculation of the LIBOR Rate)
against assets of, deposits with or for the account of, or credit extended by,
such Lender or its applicable Lending Office, and the result of any of the
foregoing shall be to increase the cost to such Lender of making or maintaining
any LIBOR Loans or issuing or to reduce the amount of any sum received or
receivable by such Lender hereunder, the Borrower will, within five (5) Business
Days of demand therefor by such Lender, pay to such Lender such additional
amounts as shall compensate such Lender for such increase in costs or reduction
in return. Notwithstanding the foregoing, the Administrative Agent and each
Lender will take any reasonable actions available to it (including designation
of a different Lending Office), consistent with legal and regulatory
restrictions, that will avoid the need to take the steps described in this
Section 2.16(a) and that will not, in the reasonable judgment of the
Administrative Agent or such Lender, be materially disadvantageous.
(b) If, at any time after the date hereof and from time to time, any
Lender shall have reasonably determined that the introduction of or any change
in any Applicable Law regarding capital adequacy or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance by such Lender with any
guideline or request from any such Governmental Authority (whether or not having
the force of law), has or would have the effect, as a consequence of such
Lender's Commitment or Loans hereunder, of reducing the rate of return on the
capital of such Lender or any Person controlling such Lender to a level below
that which such Lender or controlling Person could have achieved but for such
introduction, change or compliance (taking into account such Lender's or
controlling Person's policies with respect to capital adequacy), the Borrower
will, within five (5) Business Days of demand therefor by such Lender therefor,
pay to such Lender such additional amounts as will compensate such Lender or
controlling Person for such reduction in return.
(c) If, on or prior to the first day of any Interest Period, (y) the
Administrative Agent shall have determined that adequate and reasonable means do
not exist for ascertaining the applicable LIBOR Rate for such Interest Period or
(z) the Administrative Agent shall have received written notice from the
Required Lenders of their determination that the rate of interest referred to in
the definition of "LIBOR Rate" upon the basis of which the Adjusted LIBOR Rate
for LIBOR Loans for such Interest Period is to be determined will not adequately
and fairly reflect the cost to such Lenders of making or maintaining LIBOR Loans
during such Interest Period, the Administrative Agent will forthwith so notify
the Borrower and the Lenders. Upon such notice, (i) all then outstanding LIBOR
Loans shall automatically, on the expiration date of the respective Interest
Periods applicable thereto (unless then repaid in full), be converted into
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Base Rate Loans, (ii) the obligation of the Lenders to make, to convert Base
Rate Loans into, or to continue, LIBOR Loans shall be suspended (including
pursuant to the Borrowing to which such Interest Period applies), and (iii) any
Notice of Borrowing or Notice of Conversion/Continuation given at any time
thereafter with respect to LIBOR Loans shall be deemed to be a request for Base
Rate Loans, in each case until the Administrative Agent or the Required Lenders,
as the case may be, shall have determined that the circumstances giving rise to
such suspension no longer exist (and the Required Lenders, if making such
determination, shall have so notified the Administrative Agent), and the
Administrative Agent shall have so notified the Borrower and the Lenders.
Notwithstanding the foregoing, the Administrative Agent and each Lender will
take any reasonable actions available to it (including designation of a
different Lending Office), consistent with legal and regulatory restrictions,
that will avoid the need to take the steps described in this Section 2.16(c) and
that will not, in the reasonable judgment of the Administrative Agent or such
Lender, be materially disadvantageous.
(d) Notwithstanding any other provision in this Agreement, if, at any
time after the date hereof and from time to time, any Lender shall have
determined in good faith that the introduction of or any change in any
Applicable Law or in the interpretation or administration thereof by any
Governmental Authority charged with the interpretation or administration
thereof, or compliance with any guideline or request from any such Governmental
Authority (whether or not having the force of law), has or would have the effect
of making it unlawful for such Lender to make or to continue to make or maintain
LIBOR Loans, such Lender will forthwith so notify the Administrative Agent and
the Borrower. Upon such notice, (i) each of such Lender's then outstanding LIBOR
Loans shall automatically, on the expiration date of the respective Interest
Period applicable thereto (or, to the extent any such LIBOR Loan may not
lawfully be maintained as a LIBOR Loan until such expiration date, upon such
notice), be converted into a Base Rate Loan, (ii) the obligation of such Lender
to make, to convert Base Rate Loans into, or to continue, LIBOR Loans shall be
suspended (including pursuant to any Borrowing for which the Administrative
Agent has received a Notice of Borrowing but for which the Borrowing Date has
not arrived), and (iii) any Notice of Borrowing or Notice of
Conversion/Continuation given at any time thereafter with respect to LIBOR Loans
shall, as to such Lender, be deemed to be a request for a Base Rate Loan, in
each case until such Lender shall have determined that the circumstances giving
rise to such suspension no longer exist and shall have so notified the
Administrative Agent, and the Administrative Agent shall have so notified the
Borrower. Notwithstanding the foregoing, the Administrative Agent and each
Lender will take any reasonable actions available to it (including designation
of a different Lending Office), consistent with legal and regulatory
restrictions, that will avoid the need to take the steps described in this
Section 2.16(d) and that will not, in the reasonable judgment of the
Administrative Agent or such Lender, be materially disadvantageous.
(e) A certificate of any Lender setting forth the basis for determining
such amount or amounts necessary to compensate such Lender shall be forwarded to
the Borrower through the Administrative Agent and shall be presumed to be
correct and binding in the absence of proof of error. No failure by the
Administrative Agent or any Lender at any time to demand payment of any amounts
payable under this Section shall constitute a waiver of its right to demand
payment of any additional amounts arising at any subsequent time. Nothing in
this Section shall require or be construed to require the Borrower to pay any
interest, fees, costs or other amounts in excess of that permitted by Applicable
Law.
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2.17 Taxes.
(a) Any and all payments by the Borrower hereunder or under any Note
shall be made, in accordance with the terms hereof and thereof, free and clear
of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding taxes imposed on, or measured by, the overall net income (or
franchise taxes imposed in lieu thereof) of the Administrative Agent or any
Lender by reason of any present or former connection between the Administrative
Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political subdivision thereof, other than such a connection
arising solely from the Administrative Agent or such Lender having executed,
delivered or performed its obligations or received a payment under, or enforced,
this Agreement or the Notes (all such nonexcluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any Note to the
Administrative Agent or any Lender, (i) the sum payable shall be increased as
may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section), the
Administrative Agent or such Lender, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower will make such deductions, (iii) the Borrower will pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with Applicable Law and (iv) the Borrower will deliver to the
Administrative Agent or such Lender, as the case may be, evidence of such
payment.
(b) The Borrower will indemnify the Administrative Agent and each Lender
for the full amount of Taxes (including, without limitation, any Taxes imposed
by any jurisdiction on amounts payable under this Section) paid by the
Administrative Agent or such Lender, as the case may be, and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes were correctly or legally asserted. This
indemnification shall be made within thirty (30) days from the date the
Administrative Agent or such Lender, as the case may be, makes written demand
therefor.
(c) If the Borrower determines in good faith that a reasonable basis
exists for contesting any Taxes, the relevant Lender or the Administrative
Agent, as applicable, shall cooperate with the Borrower in challenging such Tax
at the Borrower's expense if requested by the Borrower, provided that (x) such
contest shall be undertaken solely in the name of the Borrower, and (y) each
Lender shall retain control of any contest of any Taxes undertaken in its name.
In addition, each of the Administrative Agent and each Lender agrees that if it
(in its sole discretion, exercised in good faith) subsequently determines that
it has recovered, or received a credit against, or relief, refund or remission
of, or reduction with respect to, any amount of Taxes (i) previously paid by it
and as to which it has been indemnified by or on behalf of the Borrower or (ii)
previously deducted by the Borrower (including, without limitation, any Taxes
deducted from any additional sums payable under clause (i) of subsection (a)
above), and such credit, relief, refund, remission or reduction has been
obtained, utilized or retained by the Administrative Agent or such Lender on an
affiliated group basis, then the Administrative Agent or such Lender, as the
case may be, shall reimburse the Borrower to the extent of the amount of any
such recovery or net tax benefit (but only to the extent of indemnity payments
made, or additional amounts paid, by or on behalf of the Borrower under this
Section with respect to the
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Taxes giving rise to such recovery or tax benefit); provided, however, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay to the Administrative Agent or such Lender, as the case may be, the amount
paid over to the Borrower (together with any penalties, interest or other
charges), in the event the Administrative Agent or such Lender is required to
repay such amount to the relevant taxing authority or other Governmental
Authority and; provided, further, that (i) absent manifest error, such Lender or
the Administrative Agent shall be the sole judge of the amount of such credit,
relief, refund, reduction or remission, the date on which it is received and the
net tax benefit thereof, (ii) such Lender or the Administrative Agent shall not
be obliged to disclose information regarding its tax affairs or tax
computations, and (iii) nothing in this Section 2.17(c) shall interfere with
such Lender's or the Administrative Agent's right to manage its tax affairs in
whatever manner it sees fit.
(d) If any Lender is incorporated or organized under the laws of a
jurisdiction other than the United States of America or any state thereof (a
"Non-U.S. Lender") and claims exemption from United States withholding tax
pursuant to the Internal Revenue Code, such Non-U.S. Lender will deliver to each
of the Administrative Agent and the Borrower, on or prior to the Closing Date
(or, in the case of a Non-U.S. Lender that becomes a party to this Agreement as
a result of an assignment after the Closing Date, on the effective date of such
assignment), (i) in the case of a Non-U.S. Lender that is a "bank" for purposes
of Section 881(c)(3)(A) of the Internal Revenue Code, two properly completed
Internal Revenue Service Forms 4224, 1001, ▇-▇▇▇▇, ▇-▇▇▇▇ or W-8 EXP, as
applicable (or successor forms), certifying that such Non-U.S. Lender is
entitled to an exemption from or a reduction of withholding or deduction for or
on account of United States federal income taxes in connection with payments
under this Agreement or any of the Notes, together with a properly completed
Internal Revenue Service Form W-8 or W-9, as applicable (or successor forms),
and (ii) in the case of a Non-U.S. Lender that is not a "bank" for purposes of
Section 881(c)(3)(A) of the Internal Revenue Code, two certificates in form and
substance reasonably satisfactory to the Administrative Agent and the Borrower
and to the effect that (x) such Non-U.S. Lender is not a "bank" for purposes of
Section 881(c)(3)(A) of the Internal Revenue Code, is not subject to regulatory
or other legal requirements as a bank in any jurisdiction, and has not been
treated as a bank for purposes of any tax, securities law or other filing or
submission made to any governmental authority, any application made to a rating
agency or qualification for any exemption from any tax, securities law or other
legal requirements, (y) is not a 10-percent shareholder for purposes of Section
881(c)(3)(B) of the Internal Revenue Code and (z) is not a controlled foreign
corporation receiving interest from a related person for purposes of Section
881(c)(3)(C) of the Internal Revenue Code, together with a properly completed
Internal Revenue Service Form W-8 or W-9, as applicable (or successor forms).
Each such Non-U.S. Lender further agrees to deliver, within thirty (30) days of
the receipt of a written request of the Administrative Agent or the Borrower, to
each of the Administrative Agent and the Borrower an additional copy of each
such relevant form on or before the date that such form expires or becomes
obsolete or after the occurrence of any event (including a change in its
applicable Lending Office) requiring a change in the most recent forms so
delivered by it, in each case certifying that such Non-U.S. Lender is entitled
to an exemption from or a reduction of withholding or deduction for or on
account of United States federal income taxes in connection with payments under
this Agreement or any of the Notes, unless an event (including, without
limitation, any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required, which event renders
all such forms inapplicable or the exemption to which such forms relate
unavailable and
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such Non-U.S. Lender notifies the Administrative Agent and the Borrower that it
is not entitled to receive payments without deduction or withholding of United
States federal income taxes. Each such Non-U.S. Lender will promptly notify the
Administrative Agent and the Borrower of any changes in circumstances that
relate solely to such Non-U.S. Lender that would modify or render invalid any
claimed exemption or reduction.
(e) If any Lender is entitled to a reduction in (and not a complete
exemption from) the applicable withholding tax, the Borrower and the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable withholding tax after taking into account
such reduction. If any of the forms or other documentation required under
subsection (d) above are not delivered to the Administrative Agent as therein
required, then the Borrower and the Administrative Agent may withhold from any
interest payment to such Lender not providing such forms or other documentation
an amount equivalent to the applicable withholding tax.
(f) The Borrower shall not be required to indemnify any Non-U.S. Lender,
or to pay any additional amount to any Non-U.S. Lender, in respect of United
States federal income tax pursuant to this Section 2.17 to the extent that (i)
the obligation to withhold amounts with respect to United States federal income
tax existed on the date such Non-U.S. Lender became a party to this Agreement
(or, in the case of an assignee or a participant, on the date such Person became
an assignee or participant hereunder), or with respect to payments to a new
Lending Office, the date such Non-U.S. Lender designated such new Lending Office
with respect to the Loans; provided, however, that this clause (i) shall not
apply to any assignee or Lending Office that becomes an assignee or new Lending
Office as a result of an assignment, transfer or designation made at the request
of the Borrower; and provided, further, however, that this clause (i) shall not
apply to the extent the indemnity payment or additional amounts that the
assignee or participant (or the Lender through a new Lending Office) would
otherwise be entitled to receive (without regard to this clause (i)) do not
exceed the indemnity payment or additional amounts that the Person making the
assignment, participation or transfer to such assignee or participant, or the
Lender making the designation of such new Lending Office, would have been
entitled to receive in the absence of such assignment, participation, transfer
or designation, or (ii) the obligation to pay such additional amounts would not
have arisen but for the failure of such Non-U.S. Lender to comply with the
provisions of subsection (d) above.
(g) If the Borrower is required to pay additional amounts to or for the
account of any Lender pursuant to this Section 2.17, then such Lender will
change the jurisdiction of its Lending Office if, in the judgment of such
Lender, such change (i) will eliminate or, if it is not possible to eliminate,
will reduce to the greatest extent possible any such additional payment which
may thereafter accrue and (ii) is not otherwise disadvantageous to such Lender.
Any Lender claiming any indemnity payment or additional amounts payable pursuant
to this Section 2.17 shall use reasonable efforts (consistent with legal and
regulatory restrictions) to file any certificate or document reasonably
requested in writing by the Borrower or to change the jurisdiction of its
Lending Office if the making of such a filing or change would avoid the need for
or reduce the amount of any such indemnity payment or additional amounts that
may thereafter accrue and would not, in the sole determination of such Lender,
be otherwise disadvantageous to such Lender.
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2.18 Compensation. The Borrower will compensate each Lender upon demand
for all losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Lender to fund or maintain LIBOR
Loans) that such Lender may incur or sustain (i) if due to any failure of the
Borrower, a Borrowing or continuation of, or conversion into, a LIBOR Loan does
not occur on a date specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation, (ii) if any repayment, prepayment or conversion of any
LIBOR Loan occurs on a date other than the last day of an Interest Period
applicable thereto (including as a consequence of acceleration of the maturity
of the Loans pursuant to Section 8.2), (iii) if any prepayment of any LIBOR Loan
is not made on any date specified in a notice of prepayment given by the
Borrower or (iv) as a consequence of any other failure by the Borrower to make
any payments with respect to any LIBOR Loan when due hereunder. Calculation of
all amounts payable to a Lender under this Section shall be made as though such
Lender had actually funded its relevant LIBOR Loan through the purchase of a
Eurodollar deposit bearing interest at the LIBOR Rate in an amount equal to the
amount of such LIBOR Loan, having a maturity comparable to the relevant Interest
Period; provided, however, that each Lender may fund its LIBOR Loans in any
manner it sees fit and the foregoing assumption shall be utilized only for the
calculation of amounts payable under this Section. A certificate of any Lender
setting forth the basis for determining such amount or amounts necessary to
compensate such Lender shall be forwarded to the Borrower through the
Administrative Agent and shall be presumed to be correct and binding in the
absence of proof of error.
2.19 Replacement of Lenders.
(a) The Borrower may, at any time and so long as no Default or Event of
Default has then occurred and is continuing, replace any Lender (i) that has
requested compensation from the Borrower under Section 2.16(a), 2.16(b) or 2.17
(ii) the obligation of which to make or maintain LIBOR Loans has been suspended
under Section 2.16(d) or (iii) that shall refuse to fund, or otherwise default
in the funding, of its ratable share of any Borrowing requested and permitted to
be made hereunder and such refusal has not been withdrawn or such default has
not been cured within three (3) Business Days after the Borrower has given such
Lender written notice thereof, in any case under clauses (i) through (iii) above
by written notice to such Lender and the Administrative Agent given not more
than thirty (30) days after any such event and identifying one or more Persons
each of which shall be an Eligible Assignee and reasonably acceptable to the
Administrative Agent (each, a "Replacement Lender," and collectively, the
"Replacement Lenders") to replace such Lender (the "Replaced Lender"), provided
that (i) the notice from the Borrower to the Replaced Lender and the
Administrative Agent provided for hereinabove shall specify an effective date
for such replacement (the "Replacement Effective Date"), which shall be at least
five (5) Business Days after such notice is given, (ii) as of the relevant
Replacement Effective Date, each Replacement Lender shall enter into an
Assignment and Acceptance with the Replaced Lender pursuant to Section 9.7(a)
(but shall not be required to pay the processing fee otherwise payable to the
Administrative Agent pursuant to Section 9.7(a), which fee, for purposes
hereunder, shall be waived), pursuant to which such Replacement Lenders
collectively shall acquire, in such proportion among them as they may agree with
the Borrower and the Administrative Agent, all (but not less than all) of the
Commitment and outstanding Loans of the Replaced Lender, and, in connection
therewith, shall pay (x) to the Replaced Lender, as the purchase price in
respect thereof, an amount equal to the sum as of the Replacement Effective
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Date (without duplication) of (1) the unpaid principal amount of, and all
accrued but unpaid interest on, all outstanding Loans of the Replaced Lender and
(2) the Replaced Lender's ratable share of all accrued but unpaid fees owing to
the Replaced Lender under Section 2.9(b), and (y) to the Administrative Agent,
for its own account, any amount owing to the Administrative Agent by the
Replaced Lender under Section 2.3(b), and (iii) all other obligations of the
Borrower owing to the Replaced Lender (other than those specifically described
in clause (ii) above in respect of which the assignment purchase price has been,
or is concurrently being, paid), including, without limitation, amounts payable
under Section 2.16(a) and (b) which give rise to the replacement of such
Replaced Lender and amounts payable under Section 2.18 as a result of the
actions required to be taken under this Section 2.19, shall be paid in full by
the Borrower to the Replaced Lender on or prior to the Replacement Effective
Date.
2.20 Increase in Commitments.
(a) Provided there exists no Default, upon notice to the Administrative
Agent (which shall promptly notify the Lenders), the Borrower may from time to
time, request an increase in the Aggregate Commitments to an amount (for all
such requests) not exceeding an aggregate additional $80,000,000 of Commitments
(in addition to the $220,000,000 of Aggregate Commitments on the date hereof);
provided that (i) any such request for an increase shall be in a minimum amount
of $5 million, and (ii) the Borrower may make a maximum of four such requests.
At the time of sending such notice, the Borrower (in consultation with the
Administrative Agent) shall also specify (A) the upfront fee, if any, to be paid
to the Lenders which agree to provide the requested increase in Commitments, and
(B) the time period within which each Lender is requested to respond (which
shall in no event be less than five (5) Business Days from the date of delivery
of such notice to the Lenders). Each Lender shall notify the Administrative
Agent within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or less than
its Pro Rata Share of such requested increase. Any Lender not responding within
such time period shall be deemed to have declined to increase its Commitment.
The Administrative Agent shall notify the Borrower and each Lender of the
Lenders' responses to each request made hereunder. If following such time period
the Lenders have not agreed to provide the full amount of a requested increase,
then the Borrower, at its option, may (i) rescind all or a portion of such
request made to the existing Lenders under this Section 2.20 and instead invite
one or more Eligible Assignees to become a Lender hereunder pursuant to a
Joinder Agreement; provided, however, that such Eligible Assignee or Eligible
Assignees shall have agreed to provide the full amount of such requested
increase (and shall not receive any upfront fees except as have been offered to
the Lenders), (ii) accept the offers made by the existing Lenders or (iii)
accept the offers made by the existing Lenders and also invite additional
Eligible Assignees to become Lenders pursuant to a Joinder Agreement.
(b) If the Aggregate Commitments are increased in accordance with this
Section, the Administrative Agent and the Borrower shall determine the effective
date (the "Increase Effective Date") and the final allocation of such increase.
The Administrative Agent shall promptly notify the Borrower and the Lenders of
the final allocation of such increase and the Increase Effective Date. As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate dated as of the Increase Effective Date (for
further distribution to each Lender) signed by a Responsible Officer of the
Borrower certifying that,
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before and after giving effect to such increase, (i) the representations and
warranties contained in Sections 4.1, 4.4, 4.5, 4.6, 4.7, 4.8, 4.9(g), 4.10,
4.11, 4.12, 4.14, 4.18 and 4.19 are true and correct on and as of the Increase
Effective Date, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
as of such earlier date, and (ii) no Default exists. The Borrower shall (x)
prepay any Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to Section 2.18) to the extent necessary to
keep the outstanding Loans ratable with any revised Pro Rata Shares arising from
any nonratable increase in the Aggregate Commitments under this Section and (y)
pay any accrued and unpaid commitment fee pursuant to Section 2.9(b).
(c) This Section shall supersede any provisions in Section 2.15(b) to the
contrary.
ARTICLE III
CONDITIONS OF BORROWING
3.1 Conditions to Effectiveness. The effectiveness of this Agreement and
the obligation of each Lender to make Loans in connection with the initial
Borrowing hereunder, is subject to the satisfaction of the following conditions
precedent:
(a) The Administrative Agent shall have received the following, each
dated as of the Closing Date (unless otherwise specified) and, except for the
Notes, in sufficient copies for each Lender:
(i) a Note for each Lender that is a party hereto as of the
Closing Date, in the amount of such Lender's Commitment, each duly
completed in accordance with the relevant provisions of Section 2.4 and
executed by the Borrower; and
(ii) the favorable opinions of McGuireWoods LLP, counsel to the
Borrower, in substantially the form of Exhibit E addressed to the
Administrative Agent and the Lenders and addressing such other matters as
the Administrative Agent or any Lender may reasonably request.
(b) The Administrative Agent shall have received a certificate, signed by
the president, the chief executive officer or the chief financial officer of the
Borrower, in form and substance satisfactory to the Administrative Agent,
certifying that (i) all representations and warranties of the Borrower contained
in this Agreement and the other Credit Documents are true and correct as of the
Closing Date, (ii) no Default or Event of Default has occurred and is
continuing, (iii) no Material Adverse Change has occurred since June 30, 2003,
and there exists no event, condition or state of facts that could reasonably be
expected to result in a Material Adverse Change; and (iv) all conditions to the
effectiveness of this Agreement set forth in this Section 3.1 have been
satisfied or waived in writing by the Administrative Agent and each Lender.
(c) The Administrative Agent shall have received a certificate of the
secretary or an assistant secretary of the Borrower, in form and substance
satisfactory to the Administrative Agent, certifying (i) that attached thereto
is a true and complete copy of the articles or certificate of incorporation and
all amendments thereto of the Borrower, certified as of a recent date by the
Secretary of State (or comparable Governmental Authority) of its jurisdiction of
organization,
36
and that the same has not been amended since the date of such certification,
(ii) that attached thereto is a true and complete copy of the bylaws of the
Borrower, as then in effect and as in effect at all times from the date on which
the resolutions referred to in clause (iii) below were adopted to and including
the date of such certificate, and (iii) that attached thereto is a true and
complete copy of resolutions adopted by the board of directors of the Borrower,
authorizing the execution, delivery and performance of this Agreement and the
other Credit Documents, and as to the incumbency and genuineness of the
signature of each officer of the Borrower, executing this Agreement or any other
Credit Documents, and attaching all such copies of the documents described
above.
(d) The Administrative Agent shall have received a certificate as of a
recent date of the good standing of the Borrower under the laws of its
jurisdiction of organization, from the Secretary of State of such jurisdiction.
(e) All legal matters, documentation, and corporate or other proceedings
incident to the Transactions shall be satisfactory in form and substance to the
Administrative Agent; and no action, proceeding, investigation, regulation or
legislation shall have been instituted, threatened or proposed before, and no
order, injunction or decree shall have been entered by, any court or other
Governmental Authority, in each case to enjoin, restrain or prohibit, to obtain
substantial damages in respect of this Agreement.
(f) The Borrower shall have paid (i) to the Administrative Agent for the
account of each Lender, the fees described in Section 2.9(a), and (ii) all other
fees and expenses of the Administrative Agent and the Lenders required
hereunder, the Fee Letter, or under any other Credit Document to be paid on or
prior to the Closing Date (including fees and expenses of counsel) in connection
with this Agreement and the transactions contemplated hereby.
(g) The Administrative Agent shall have received an Account Designation
Letter, together with written instructions from an Authorized Officer, including
wire transfer information, directing the payment of the proceeds of the initial
Loans and until replaced by a new Account Designation Letter, all other loans to
be made hereunder.
(h) The Administrative Agent shall have received evidence that the
Existing Credit Agreement has been or concurrently with the Closing Date is
being terminated.
(i) The Administrative Agent and each Lender shall have received such
other documents, certificates, opinions and instruments in connection with the
transactions contemplated hereby as it shall have reasonably requested.
3.2 Conditions of All Borrowings. The obligation of each Lender to make
any Loans hereunder, including the initial Loans, is subject to the satisfaction
of the following conditions precedent on the relevant Borrowing Date:
(a) The Administrative Agent shall have received a Notice of Borrowing in
accordance with Section 2.2(b);
(b) Each of the representations and warranties contained in Sections 4.1,
4.4, 4.5, 4.6, 4.7, 4.8, 4.9(g), 4.10, 4.11, 4.12, 4.14, 4.18 and 4.19 shall be
true and correct on and as of such
37
Borrowing Date (including the Closing Date, in the case of any Loans made
hereunder on the Closing Date) with the same effect as if made on and as of such
date, both immediately before and after giving effect to the Loans to be made on
such date (except to the extent any such representation or warranty is expressly
stated to have been made as of a specific date, in which case such
representation or warranty shall be true and correct in all material respects as
of such date); and
(c) No Default or Event of Default shall have occurred and be continuing
on such date hereunder, both immediately before and after giving effect to the
Loans to be made on such date; provided, however, that for determinations of
whether there is a Default or Event of Default on account of a violation of
Section 6.3, the fair market value of the Eligible Investments of the Borrower
or any Subsidiary shall be deemed to be the fair market value of the Eligible
Investments held by such Person five (5) Business Days before the date of
Borrowing.
(d) Each giving of a Notice of Borrowing, and the consummation of each
Borrowing, shall be deemed to constitute a representation by the Borrower that
the statements contained in subsections (b) and (c) above are true, both as of
the date of such notice or request and as of the relevant Borrowing Date.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this
Agreement and to induce the Lenders to extend the credit contemplated hereby,
the Borrower represents and warrants to the Administrative Agent and the
Lenders:
4.1 Organization; Power; Qualification. Each of the Borrower and its
Material Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation, has the
corporate power and authority to own its properties and to carry on its business
as now being conducted and is duly qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature or
transaction of its business requires such qualification and authorization,
except where a failure to be so qualified and authorized would not in any given
case or in the aggregate have a Material Adverse Effect.
4.2 Ownership. Schedule 4.2 sets forth, as of the Closing Date, all of
the Subsidiaries of the Borrower, and, as to each such Subsidiary, the
percentage ownership (direct and indirect) of the Borrower in each class of its
Capital Stock and each direct owner thereof, and indicates in each case whether
such Subsidiary is a Material Subsidiary. There are no outstanding stock
purchase warrants, subscriptions, options, securities, instruments or other
rights of any type or nature whatsoever, which are convertible into,
exchangeable for or otherwise provide for or permit the issuance of Capital
Stock of the Borrower or its Subsidiaries, except as disclosed in the applicable
filings of the Borrower with the SEC.
4.3 Authorization. The Borrower has the corporate power and authority and
has taken all necessary corporate and other action to authorize the execution,
delivery and performance of this Agreement and each of the other Credit
Documents to which it is a party in
38
accordance with their respective terms. This Agreement and each of the other
Credit Documents have been duly executed and delivered by the duly authorized
officers of the Borrower, and each such document constitutes the legal, valid
and binding obligation of the Borrower, enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar state or federal debtor relief laws from
time to time in effect which affect the enforcement of creditors' rights in
general and the availability of equitable remedies.
4.4 Compliance of Agreement with Laws, Etc. The execution, delivery and
performance by the Borrower of the Credit Documents in accordance with their
respective terms, the Borrowings hereunder and the other Transactions do not and
will not, by the passage of time, the giving of notice or otherwise, (i) require
any material Governmental Approval which has not been obtained or waived, or,
violate any Applicable Law relating to the Borrower or any Subsidiary, (ii)
conflict with, result in a breach of or constitute a default under the articles
of incorporation, bylaws or other organizational documents of the Borrower or
any Subsidiary or any material indenture, agreement or other instrument to which
the Borrower or any Subsidiary is a party or by which any of their respective
properties may be bound or any Governmental Approval relating to such Person, or
(iii) result in or require the creation or imposition of any Lien upon or with
respect to any property now owned or hereafter acquired by the Borrower or any
Subsidiary. Neither the Borrower nor any of its Material Subsidiaries is a party
to any agreement or instrument or otherwise subject to any restriction or
encumbrance that restricts or limits the ability of any Material Subsidiary (A)
to make dividend payments or other distributions in respect of its Capital
Stock, (B) to repay Indebtedness owed to the Borrower or any Subsidiary, (C) to
make loans in advances to the Borrower or any Subsidiary, or (D) to transfer any
of its assets or properties to the Borrower or any of its Subsidiaries, in each
case, other than such restrictions or encumbrances existing under or by reason
of the Credit Documents, any Applicable Law or agreements with Governmental
Authorities which could not reasonably be expected to result in a Material
Adverse Effect.
4.5 Compliance with Law; Governmental Approvals. Each of the Borrower and
its Subsidiaries (i) has all Governmental Approvals required by any Applicable
Law for it to conduct its business, each of which is in full force and effect,
is final and not subject to review on appeal and is not the subject of any
pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, and (ii) is in compliance with each Governmental Approval
applicable to it and is otherwise in compliance with all Applicable Laws in
respect of the conduct of its business and the ownership and operation of its
properties, except where a failure to have such Governmental Approvals, to be in
compliance therewith or the failure to comply with such Applicable Law would not
in any given case or in the aggregate have a Material Adverse Effect.
4.6 Litigation. Except as disclosed by the Borrower in its filings with
the SEC made prior to the date hereof, there are no actions, suits or
proceedings pending nor, to the knowledge of the Borrower, threatened against or
in any other way relating adversely to or affecting the Borrower or any
Subsidiary or any of their respective properties in any court or before any
arbitrator of any kind or before or by any Governmental Authority or other
person in which there is a reasonable possibility of an adverse decision and
which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect.
39
4.7 Tax Returns and Payments. Each of the Borrower and its Subsidiaries
has duly filed or caused to be filed all federal, state, local and other tax
returns required to be filed by it, and has paid, or made adequate provision for
the payment of, all federal, state, local and other taxes, assessments and
governmental charges or levies upon it and its property, income, profits and
assets which are due and payable, other than those which are not yet delinquent
and other than those which are being contested by the Borrower or such
Subsidiary in good faith and by appropriate proceedings and for which the
Borrower or such Subsidiary has established reserves as required by GAAP. No
Governmental Authority has asserted any Lien or other claim against the Borrower
or any Subsidiary with respect to unpaid taxes which has not been discharged or
resolved. The charges, accruals and reserves on the books of the Borrower and
any of its Subsidiaries in respect of federal, state, local and other taxes
since the organization of the Borrower and any of its Subsidiaries are in the
judgment of the Borrower adequate, and the Borrower does not anticipate any
additional material taxes or assessments for any of such years.
4.8 Intellectual Property Matters. To the best of the Borrower's
knowledge, each of the Borrower and its Subsidiaries owns or possesses rights to
use all material franchises, licenses, copyrights, copyright applications,
patents, patent rights or licenses, patent applications, trademarks, trademark
rights, trade names, trade name rights, copyrights and rights with respect to
the foregoing which are required to conduct its business. To the best of the
Borrower's knowledge, no event has occurred which permits, or after notice or
lapse of time or both would permit, the revocation or termination of any such
rights which are material to the Borrower or its Subsidiaries, and neither the
Borrower nor any Subsidiary is liable in any material respect to any Person for
infringement under Applicable Law with respect to any such rights as a result of
its business operations.
4.9 Environmental Matters.
(a) The properties of the Borrower and its Subsidiaries do not contain,
and to their knowledge have not previously contained, any Hazardous Materials in
amounts or concentrations which (A) constitute or constituted a violation of, or
(B) could give rise to any liability under, applicable Environmental Laws.
(b) To the best of the knowledge of the Borrower, such properties and all
operations conducted in connection therewith are in compliance, and have been in
compliance, with all applicable Environmental Laws, and, to the best of the
knowledge of the Borrower, there is no contamination at, under or about such
properties or such operations which could interfere with the continued operation
of any material property or properties of the Borrower and its Subsidiaries or
impair the fair salable value thereof.
(c) Neither the Borrower nor any Subsidiary has received any notice of
violation, alleged violation, noncompliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of their properties or the operations conducted in connection
therewith, nor does the Borrower or any Subsidiary have knowledge or reason to
believe that any such notice will be received or is being threatened.
(d) Hazardous Materials have not been transported or disposed of from the
properties of the Borrower and its Subsidiaries in violation of, or in a manner
or to a location which could
40
give rise to liability under, Environmental Laws, nor have any Hazardous
Materials been generated, treated, stored or disposed of at, on or under any of
such properties in violation of, or in a manner that could give rise to any
liability under, any applicable Environmental Laws.
(e) No judicial proceedings or governmental or administrative action is
pending, or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to such properties or operations conducted in connection
therewith, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to such
properties or such operations.
(f) There has been no release, or to the best of the knowledge of the
Borrower, the threat of release, of Hazardous Materials at or from such
properties, in violation of or in amounts or in a manner that could give rise to
liability under Environmental Laws.
(g) In the ordinary course of its business, the Borrower conducts an
ongoing review of the effect of Environmental Laws on the operations and
properties of the Borrower and its Subsidiaries, in the course of which it
identifies and evaluates associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat, any costs or liabilities
in connection with off-site disposal of wastes or Hazardous Materials and any
related costs and expenses). On the basis of this review, the Borrower has
reasonably concluded that such associated liabilities and costs, including the
costs of compliance with Environmental Laws, are unlikely to have a Material
Adverse Effect.
4.10 ERISA.
(a) The Borrower and each ERISA Affiliate are in compliance in all
material respects with all applicable provisions of ERISA and the regulations
and published interpretations thereunder with respect to all Employee Benefit
Plans except for any required amendments for which the remedial amendment period
as defined in Section 401(b) of the Internal Revenue Code has not yet expired.
Each Employee Benefit Plan that is intended to be qualified under Section 401(a)
of the Internal Revenue Code has been determined by the Internal Revenue Service
to be so qualified, and each trust related to such plan has been determined to
be exempt under Section 501(a) of the Internal Revenue Code. No liability has
been incurred by the Borrower or any ERISA Affiliate which remains unsatisfied
for any taxes or penalties with respect to any Employee Benefit Plan or any
Multiemployer Plan.
(b) No Material Pension Plan has been terminated, nor has any accumulated
funding deficiency (as defined in Section 412 of the Internal Revenue Code) been
incurred (without regard to any waiver granted under Section 412 of the Internal
Revenue Code), nor has any funding waiver from the Internal Revenue Service been
received or requested with respect to any
41
Material Pension Plan, nor has the Borrower or any ERISA Affiliate failed to
make any contributions or to pay any amounts due and owing as required by
Section 412 of the Internal Revenue Code, Section 302 of ERISA or the terms of
any Pension Plan by the due dates of such contributions under Section 412 of the
Internal Revenue Code or Section 302 of ERISA, nor has there been any event
requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with
respect to any Pension Plan.
(c) Neither the Borrower nor any ERISA Affiliate has: (i) engaged in a
material nonexempt prohibited transaction described in Section 406 of ERISA or
Section 4975 of the Internal Revenue Code, (ii) incurred any liability to the
PBGC which remains outstanding other than the payment of premiums and there are
no premium payments which are due and unpaid, (iii) failed to make a required
contribution or payment to a Multiemployer Plan, or (iv) failed to make a
required installment or other required payment under Section 412 of the Internal
Revenue Code.
(d) No Termination Event has occurred or is reasonably expected to occur.
(e) No proceeding, claim, lawsuit and/or investigation is existing or, to
the best knowledge of the Borrower, threatened concerning or involving any (A)
employee welfare benefit plan (as defined in Section 3(1) of ERISA) currently
maintained or contributed to by the Borrower or any ERISA Affiliate, (B) Pension
Plan or (C) Multiemployer Plan in which there is a reasonable possibility of an
adverse decision and which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect.
4.11 Margin Stock. Neither the Borrower nor any Subsidiary is engaged
principally or as one of its activities in the business of extending credit for
the purpose of "purchasing" or "carrying" (as each such term is defined or used
in Regulation U) any Margin Stock. No part of the proceeds of any of the Loans
will be used for purchasing or carrying Margin Stock in violation of the
provisions of Regulation T, U or X or any provision of the Exchange Act and,
without limiting the generality of the foregoing, not more than 25% of the value
of the assets of the Borrower and its Subsidiaries, on a consolidated basis,
that are subject to the restrictions in Section 7.2 or 7.3 will be attributable
to Margin Stock.
4.12 Government Regulation. Neither the Borrower nor any Subsidiary is an
"investment company" or a company "controlled" by an "investment company" (as
each such term is defined or used in the Investment Company Act of 1940, as
amended), and neither the Borrower nor any Subsidiary is, or after giving effect
to the Loans will be, subject to regulation under the Public Utility Holding
Company Act of 1935 or the Interstate Commerce Act, each as amended, or any
other Applicable Law which limits its ability to incur or consummate the
transactions contemplated hereby.
4.13 Material Contracts. The Borrower and its Subsidiaries have no
Material Contracts except for those disclosed in the applicable filings of the
Borrower with the SEC. Each Material Contract of the Borrower and its
Subsidiaries is, and after giving effect to the consummation of the Transactions
will be, in full force and effect in accordance with the terms thereof.
42
4.14 Burdensome Provisions. Neither the Borrower nor any Subsidiary is a
party to any indenture, agreement, lease or other instrument, or subject to any
corporate or partnership restriction, Governmental Approval or Applicable Law
which is so unusual or burdensome as in the foreseeable future could be
reasonably expected to have a Material Adverse Effect. The Borrower and its
Subsidiaries do not presently anticipate that future expenditures needed to meet
the provisions of any statutes, orders, rules or regulations of a Governmental
Authority will be so burdensome as to have a Material Adverse Effect.
4.15 Financial Matters.
(a) The Borrower has heretofore furnished or made available to the
Administrative Agent and each Lender copies of (i) the audited consolidated
balance sheets of the Borrower and its Subsidiaries as of December 31, 2002,
2001, and 2000 and the related statements of income and cash flows for the
fiscal years ended December 31, 2002, 2001 and 2000, together with the opinion
of KPMG, LLP thereon, and (ii) the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as of June 30, 2003, and the related statements of
income and cash flows for the six-month period then ended. Such financial
statements have been prepared in accordance with GAAP (subject, with respect to
the unaudited financial statements, to the absence of notes required by GAAP,
and with respect to the financial statements described in clauses (i) and (ii)
above, to normal year-end adjustments) and fairly present in accordance with
GAAP (x) the financial condition of the Borrower and its Subsidiaries on a
consolidated basis as of the respective dates thereof, and (y) the results of
operations of the Borrower and its Subsidiaries, on a consolidated basis, for
the respective periods then ended. Except as fully reflected in the most recent
financial statements referred to above and the notes thereto, there are no
material liabilities or obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute, contingent or otherwise
and whether or not due) that would in accordance with GAAP have been required to
be disclosed or provided for in such financial statements.
(b) The Borrower has heretofore furnished or made available to the
Administrative Agent and each Lender copies of (i) the Annual Statements of each
of its Material Insurance Subsidiaries as of December 31, 2002, 2001 and 2000,
and for the fiscal years then ended, and (ii) the Quarterly Statements of each
of its Material Insurance Subsidiaries as of June 30, 2003, and for the
six-month period then ended, each as filed with the relevant Insurance
Regulatory Authority. Such financial statements (including, without limitation,
the provisions made therein for investments and the valuation thereof, reserves,
policy and contract claims and statutory liabilities) have been prepared in
accordance with SAP (except as may be reflected in the notes thereto and
subject, with respect to the Quarterly Statements, to the absence of notes
required by SAP and to normal year-end adjustments), were in compliance with
Applicable Law when filed and fairly present in accordance with SAP the
financial condition of the respective Insurance Subsidiaries covered thereby as
of the respective dates thereof and the results of operations, changes in
capital and surplus and cash flow of the respective Insurance Subsidiaries
covered thereby for the respective periods then ended. Except for liabilities
and obligations disclosed or provided for in such financial statements
(including, without limitation, reserves, policy and contract claims and
statutory liabilities), no Insurance Subsidiary had, as of the date of its
respective financial statements, any material liabilities or obligations of any
nature whatsoever (whether absolute, contingent or otherwise and whether or not
due) that, in accordance with
43
SAP, would have been required to have been disclosed or provided for in such
financial statements. All books of account of each Insurance Subsidiary fully
and fairly disclose all of its material transactions, properties, assets,
investments, liabilities and obligations, are in its possession and are true,
correct and complete in all material respects.
(c) The Borrower, (i) has capital sufficient to carry on its businesses
as conducted and as proposed to be conducted, (ii) has assets with a fair
saleable value, determined on a going concern basis, (y) not less than the
amount required to pay the probable liability on its existing debts as they
become absolute and matured and (z) greater than the total amount of its
liabilities (including identified contingent liabilities, valued at the amount
that can reasonably be expected to become absolute and matured), and (iii) does
not intend to, and does not believe that it will, incur debts or liabilities
beyond its ability to pay such debts and liabilities as they mature.
4.16 No Material Adverse Change. As of the Closing Date, (a) there has
been no Material Adverse Change since June 30, 2003, and (b) no event has
occurred or condition arisen that could reasonably be expected to result in a
Material Adverse Change.
4.17 Reinsurance Agreements. After taking into consideration provisions
for uncollectable reinsurance for which reserves have been reflected in the
financial statements of the Borrower or any of its Subsidiaries, the Borrower
has no reason to believe that any material amount recoverable pursuant to any
material Reinsurance Agreement applicable to the Insurance Subsidiaries or their
properties or assets reflected in the relevant Annual Statement or Quarterly
Statement is not fully collectible in due course. Each Insurance Subsidiary is
entitled to take full credit on its Annual Statement or Quarterly Statement
pursuant to Applicable Law for such reinsurance, coinsurance or excess insurance
ceded pursuant to any such Reinsurance Agreement. There are no assumption
reinsurance contracts or arrangements entered into by any Insurance Subsidiary
in which such Insurance Subsidiary has ceded risk to any other Person which are
material individually or in the aggregate to the Borrower and its Subsidiaries,
taken as a whole.
4.18 Absence of Defaults. No event has occurred and is continuing which
constitutes a Default or an Event of Default, or which constitutes, or which
with the passage of time or giving of notice or both would constitute, a default
or event of default by the Borrower or any Subsidiary under any material
judgment, decree or order to which the Borrower or its Subsidiaries is a party
or by which the Borrower or its Subsidiaries or any of their respective
properties may be bound or which would require the Borrower or its Subsidiaries
to make any payment thereunder prior to the scheduled maturity date therefor.
4.19 Accuracy and Completion of Information. All written information,
reports and other papers and data produced by or on behalf of the Borrower or
any of its Subsidiaries and furnished to the Administrative Agent or the Lenders
were, at the time the same were so furnished, complete and correct in all
material respects. No document furnished or written statement made to the
Administrative Agent or the Lenders by the Borrower or any of its Subsidiaries
in connection with the negotiation, preparation or execution of this Agreement
or any of the Credit Documents or in connection with the Transactions contains
or will contain any untrue statement of a fact material to the creditworthiness
of the Borrower, or its Subsidiaries or omits or will omit to state a fact
necessary in order to make the statements contained therein not
44
misleading with respect to the creditworthiness of the Borrower or its
Subsidiaries. The Borrower is not aware of any facts which it has not disclosed
in writing to the Administrative Agent having a Material Adverse Effect, or
which, insofar as the Borrower can now foresee, could reasonably be expected to
have a Material Adverse Effect.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, until the termination of the
Commitments and the payment in full of all principal and interest with respect
to the Loans together with all other amounts then due and owing hereunder:
5.1 GAAP Financial Statements. The Borrower will deliver to each Lender:
(a) As soon as available and in any event within sixty (60) days after
the end of each of the first three fiscal quarters of each fiscal year,
beginning with the fiscal quarter ending September 30, 2003, the quarterly
report for the Borrower on Form 10-Q (or other applicable form) filed with the
SEC with respect to such quarter;
(b) As soon as available and in any event within one hundred twenty (120)
days after the end of each fiscal year, beginning with the fiscal year ending
December 31, 2003, the annual report for the Borrower on Form 10-K (or other
applicable form) filed with the SEC with respect to such year;
(c) As soon as available and in any event within sixty (60) days after
the end of each fiscal quarter, beginning with the fiscal quarter ending
September 30, 2003, unaudited consolidating balance sheets of the Borrower and
its Subsidiaries as of the end of such fiscal quarter and unaudited
consolidating statements of income and cash flows for the Borrower and its
Subsidiaries for the fiscal quarter then ended and for that portion of the
fiscal year then ended, and, in each case setting forth comparative consolidated
figures as of the end of and for the corresponding period in the preceding
fiscal year, all in reasonable detail and prepared in accordance with GAAP
(subject to the absence of notes required by GAAP and subject to normal year-end
adjustments) applied on a basis consistent with that of the preceding quarter or
containing disclosure of the effect on the financial condition or results of
operations of any change in the application of accounting principles and
practices during such quarter;
(d) Such additional information, reports or statements (financial or
otherwise) as the Administrative Agent or any Lender may from time to time
reasonably request.
(e) Without in any way limiting the effect of Section 10.5(c), documents
required to be delivered pursuant to Sections 5.1(a), (b) or (c), or 5.3(c) (to
the extent any such documents are included in materials otherwise filed with the
SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which the Borrower posts such documents,
or provides a link thereto on the Borrower's website on the Internet at the
website address identified pursuant to Section 10.5; or (ii) on which such
documents are posted on the Borrower's behalf on IntraLinks/IntraAgency or
another relevant website, if any, to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether
sponsored by the Administrative Agent); provided that: (i) the Borrower shall
45
deliver paper copies of such documents to the Administrative Agent or any Lender
that requests the Borrower to deliver such paper copies until a written request
to cease delivering paper copies is given by the Administrative Agent or such
Lender and (ii) the Borrower shall notify (which may be by facsimile or
electronic mail) the Administrative Agent and each Lender of the posting of any
such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents. The Administrative
Agent shall have no obligation to request the delivery or to maintain copies of
the documents referred to above, and in any event shall have no responsibility
to monitor compliance by the Borrower with any such request for delivery, and
each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.
5.2 Statutory Financial Statements. The Borrower will deliver to each
Lender:
(a) As soon as available and in any event within sixty (60) days after
the end of each of the first three fiscal quarters of each fiscal year,
beginning with the fiscal quarter ending September 30, 2003, a Quarterly
Statement of each Insurance Subsidiary as of the end of such fiscal quarter and
for that portion of the fiscal year then ended, in the form filed with the
relevant Insurance Regulatory Authority, prepared in accordance with SAP;
(b) As soon as available and in any event within sixty (60) days after
the end of each of the first three fiscal quarters of each fiscal year,
beginning with the fiscal quarter ending September 30, 2003, the syndicate
quarterly report for each Lloyd's Syndicate managed by a Subsidiary as of the
end of such fiscal quarter and the for that portion of the fiscal year then
ended, in the form filed with Lloyd's of London;
(c) As soon as available and in any event within one hundred twenty (120)
days after the end of each fiscal year, beginning with the fiscal year ended
December 31, 2003, an Annual Statement of each Insurance Subsidiary, as of the
end of such fiscal year and for the fiscal year then ended, in the form filed
with the relevant Insurance Regulatory Authority, prepared in accordance with
SAP;
(d) As soon as available and in any event within one hundred twenty (120)
days after the end of each fiscal year, beginning with the fiscal year ended
December 31, 2003, the annual solvency return filed with Lloyd's of London on
behalf of any Lloyd's Syndicate managed by a Subsidiary as of the end of such
fiscal year and for the fiscal year then ended, in the form filed with Lloyd's
of London; and
(e) To the extent required by any Insurance Regulatory Authority, as soon
as available and in any event within one hundred twenty (120) days after the end
of each fiscal year, beginning with the fiscal year ended December 31, 2003, a
combined Annual Statement of the U.S. Insurance Subsidiaries as of the end of
such fiscal year and for the fiscal year then ended, in the form filed with the
relevant Insurance Regulatory Authorities, prepared in accordance with SAP.
5.3 Other Business and Financial Information. The Borrower will deliver
the following:
46
(a) To each Lender, concurrently with each delivery of the financial
statements described in Sections 5.1 and 5.2, a Compliance Certificate in the
form of Exhibit C with respect to the period covered by the financial statements
then being delivered, executed by the chief financial officer of the Borrower
(or a vice president of the Borrower having significant responsibility for
financial matters), together in each case with a Covenant Compliance Worksheet
reflecting the computation of the respective financial covenants set forth in
the Worksheets as of the last day of the period covered by such financial
statements;
(b) To each Lender, concurrently with the delivery of the annual report
for the Borrower on Form 10-K described in Section 5.1(b), (i) a report thereon
by KPMG, LLP, or another independent certified public accounting firm of
recognized national standing reasonably acceptable to the Required Lenders, that
is not qualified as to going concern or scope of audit and to the effect that
such financial statements present fairly the consolidated financial condition
and results of operations of the Borrower and its Subsidiaries, as of the dates
and for the periods indicated in accordance with GAAP applied on a basis
consistent with that of the preceding year or containing disclosure of the
effect on the financial condition or results of operations of any change in the
application of accounting principles and practices during such year, and (ii) a
report by such accountants to the effect that, based on and in connection with
their examination of the financial statements of the Borrower and its
Subsidiaries, they obtained no knowledge of the occurrence or existence of any
Default or Event of Default relating to accounting or financial reporting
matters, or a statement specifying the nature and period of existence of any
such Default or Event of Default disclosed by their audit; provided, however,
that such accountants shall not be liable by reason of the failure to obtain
knowledge of any Default or Event of Default that would not be disclosed or
revealed in the course of their audit examination;
(c) To each Lender, promptly upon the sending, filing or receipt thereof,
copies of (i) all financial statements, reports (including annual reports),
notices as to material matters and proxy statements that the Borrower or any of
its Subsidiaries shall send or make available generally to the Borrower's
shareholders; (ii) all regular, periodic and special reports, registration
statements and prospectuses (other than on Form S-8) that the Borrower or any of
its Subsidiaries shall render to or file with the SEC, the National Association
of Securities Dealers, Inc. or any national securities exchange; (iii) to the
extent permitted by Applicable Law, all significant reports on examination or
other similar significant reports, financial examination reports or market
conduct examination reports by the NAIC or any Insurance Regulatory Authority or
other Governmental Authority with respect to any Insurance Subsidiary's
insurance business; (iv) all significant filings made under applicable state
insurance holding company acts by the Borrower or any of its Subsidiaries,
including, without limitation, filings seeking approval of material transactions
with Affiliates; and (v) all material information sent by the Borrower or any of
its subsidiaries to rating agencies (including, without limitation, those
identified in Section 5.3(f)(v));
(d) To each Lender, promptly upon filing with the relevant Insurance
Regulatory Authority and in any event within ninety (90) days after the end of
each fiscal year, beginning with the fiscal year ended December 31, 2003, a copy
of each U.S. Insurance Subsidiary's "Statement of Actuarial Opinion" (or
equivalent information should the relevant Insurance Regulatory Authority not
require such a statement) as to the adequacy of such U.S. Insurance Subsidiary's
loss reserves for such fiscal year, together with a copy of its management
discussion
47
and analysis in connection therewith, each in the format prescribed by the
applicable insurance laws of such U.S. Insurance Subsidiary's jurisdiction of
domicile;
(e) To the Administrative Agent (who upon receipt shall deliver such
report to each Lender that from time to time requests delivery thereof (by
giving notice to the Administrative Agent) and executes a confidentiality
agreement in form and substance satisfactory to the appropriate actuary or firm
of actuaries), within thirty (30) days of receipt by the Borrower or any
Insurance Subsidiary, an annual actuarial review of the liabilities and other
items of each Insurance Subsidiary as of the end of each fiscal year, commencing
with the fiscal year ending December 31, 2003, prepared at the Borrower's
expense, by an actuary or a firm of actuaries of national recognition; and
(f) To each Lender, promptly upon (but in no event later than ten (10)
days after) a Responsible Officer of the Borrower obtains knowledge thereof,
telephonic and written notice of any of the following:
(i) the occurrence of any Default or Event of Default, together
with a written statement of a Responsible Officer of the Borrower
specifying the nature of such Default or Event of Default, the period of
existence thereof and the action that the Borrower has taken and proposes
to take with respect thereto;
(ii) the institution or threatened institution of any action, suit,
investigation or proceeding against or affecting the Borrower or any of its
Subsidiaries, including any such investigation or proceeding by any
Governmental Authority (other than routine periodic inquiries,
investigations or reviews), that would be reasonably likely, individually
or in the aggregate, to have a Material Adverse Effect, and any material
development in any litigation or other proceeding previously reported
pursuant to Section 4.6 or this subsection;
(iii) the receipt by the Borrower or any of its Subsidiaries from
any Governmental Authority of (y) any notice asserting any failure by the
Borrower or any of its Subsidiaries to be in compliance with Applicable Law
or that threatens the taking of any action against the Borrower or such
Subsidiary or sets forth circumstances that would be reasonably likely to
have a Material Adverse Effect, or (z) any notice of any actual or
threatened suspension, limitation or revocation of, failure to renew, or
imposition of any restraining order, escrow or impoundment of funds in
connection with, any license, permit, accreditation or authorization of the
Borrower or any of its Subsidiaries, where such action would be reasonably
likely to have a Material Adverse Effect;
(iv) the occurrence of any Termination Event, together with (x) a
written statement of a Responsible Officer of the Borrower specifying the
details of such Termination Event and the action that the Borrower has
taken and proposes to take with respect thereto, (y) a copy of any notice
with respect to such Termination Event that may be required to be filed
with the PBGC and (z) a copy of any notice delivered by the PBGC to the
Borrower or such ERISA Affiliate with respect to such Termination Event;
48
(v) any change by Standard & Poor's Rating Group, a division of
McGraw Hill Companies, Inc., ▇▇▇▇▇'▇ Investors Service, Inc. or A.M. Best &
Company in the senior unsecured debt credit rating of the Borrower; and
(vi) any event which makes any of the representations set forth in
Article IV inaccurate in any material respect.
5.4 Accuracy of Information. All written information, reports, statements
and other papers and data furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender (other than financial forecasts) whether
pursuant to this Article V or any other provision of this Agreement or any of
the other Credit Documents, shall be, at the time the same is so furnished,
complete and correct in all material respects.
5.5 Taxes. The Borrower will pay and discharge, and cause each of its
Subsidiaries to pay and discharge, all taxes, assessments, and governmental
charges upon it, its income, and its properties prior to the date on which
penalties are attached thereto, unless and to the extent only that (a) such
taxes, assessments, and governmental charges are being contested by the Borrower
or such Subsidiary in good faith and by appropriate proceedings, and (b) the
non-payment of such taxes, assessments or charges would not have a material
adverse effect on the business, operations, property or financial condition of
the Borrower, any Material Subsidiary or the Borrower and its Subsidiaries taken
as a whole and would not materially and adversely affect the ability of the
Borrower to perform its obligations under this Agreement or any of the other
Credit Documents.
5.6 Insurance. The Borrower will maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible companies selected by the
Borrower and satisfactory to the Administrative Agent in such amounts and
against such risks as is customarily carried by owners of similar businesses and
property, and, on the Closing Date and from time to time thereafter, deliver to
the Administrative Agent upon its request a detailed list of the insurance then
in effect, stating the names of the insurance companies, the amounts and rates
of the insurance, the dates of the expiration thereof and the properties and
risks covered thereby.
5.7 Corporate Existence; Franchises. The Borrower will, except as
otherwise permitted by Section 7.3, maintain, and cause each of its Material
Subsidiaries to maintain, its corporate existence in good standing and to
maintain all licenses, filings, registrations and Governmental Approvals
material to the conduct of its business as now being conducted.
5.8 Properties. The Borrower will maintain, preserve, and protect all
material franchises and trade names and preserve all the remainder of its
material property used or useful in the conduct of its business and keep the
same in good repair, working order, and condition, and from time to time make or
cause to be made all needful and proper repairs, renewals, replacements,
betterments, and improvements thereto so that the business carried on in
connection therewith may be properly and advantageously conducted at all times,
and cause each of its Subsidiaries to so maintain its material properties;
provided that nothing contained in this Section 5.8 shall prevent the Borrower
or any Subsidiary from discontinuing any franchise or trade name which is not
material to its business or the operation and maintenance of any of its
non-material properties or from failing to make any repairs, renewals,
replacements, betterments
49
or improvements thereto if such discontinuance or failure is desirable, in the
best judgment of the Borrower, in the conduct of its business or the business of
any Subsidiary.
5.9 ERISA. The Borrower will in addition to and without limiting the
generality of Section 5.11, (a) not take any action or fail to take any action
the result of which could be a material liability to the PBGC or to a
Multiemployer Plan, (b) not participate in any prohibited transaction that could
result in any material civil penalty under ERISA or tax under the Internal
Revenue Code, and (c) furnish to the Administrative Agent upon the
Administrative Agent's request such additional information concerning any
Employee Benefit Plan as may be reasonably requested by the Administrative
Agent.
5.10 Investment Guidelines. The Borrower will cause each of its Insurance
Subsidiaries to comply in all material respects with all applicable regulatory
investment requirements and guidelines, and all internal investment requirements
and guidelines as they exist from time to time, and deliver to the
Administrative Agent a copy of the revised internal investment requirements and
guidelines each time they are modified in any material respect by an Insurance
Subsidiary.
5.11 Compliance with Laws. The Borrower will comply, and cause each of its
Subsidiaries to comply, in all material respects with all Applicable Laws,
including, without limitation, compliance with all Environmental Laws, and
maintain in full force and effect all material Governmental Approvals, in each
case applicable to the conduct of its business and the ownership and operation
of its properties.
5.12 Accounting Methods and Financial Records. The Borrower will maintain,
and cause each of its Subsidiaries to maintain, a system of accounting, and
keep, and cause each of its Subsidiaries to keep, such books, records and
accounts (which shall be true and complete in all material respects) as may be
required or as may be necessary to permit the preparation of financial
statements in accordance with GAAP or SAP, as applicable, and in compliance with
the regulations of any Governmental Authority having jurisdiction over it or any
of its properties.
5.13 Visits and Inspections. The Borrower will permit, and cause each of
its Subsidiaries to permit, representatives of the Administrative Agent or any
Lender, from time to time, to visit and inspect its properties; inspect, audit
and make extracts from its books, records and files, including, but not limited
to, management matters prepared by independent accountants; and discuss with its
principal officers and its independent accountants its business, assets,
liabilities, financial condition, results of operations and business prospects.
5.14 Conduct of Business. The Borrower will engage, and cause each of its
Subsidiaries to engage, in business in substantially the same fields as the
businesses conducted on the Closing Date and in lines of business reasonably
related thereto.
5.15 Further Assurances. The Borrower will make, execute and deliver all
such additional and further documents and instruments, and take all such further
actions, as the Administrative Agent or any Lender may reasonably require to
document and consummate the transactions contemplated hereby and to vest
completely in and insure the Administrative Agent
50
and the Lenders their respective rights under this Agreement, the Notes and the
other Credit Documents.
ARTICLE VI
FINANCIAL COVENANTS
The Borrower covenants and agrees that, until the termination of the
Commitments and the payment in full of all principal and interest with respect
to the Loans together with all other amounts then due and owing hereunder:
6.1 Leverage Ratio. The Borrower will not permit the Leverage Ratio as of
any date after the Closing Date to be greater than 0.375 to 1.00.
6.2 Minimum Consolidated Net Worth. The Borrower will not permit, as of
any date after the Closing Date, its Consolidated Net Worth to fall below the
sum of (a) $800,000,000, plus, on a cumulative basis, (b) an amount for each
fiscal year of the Borrower ended after the Closing Date (commencing with the
fiscal year ending December 31, 2003) equal to 50% of the difference between (i)
the Consolidated Net Income of the Borrower for such fiscal year, minus (ii) the
sum of the aggregate dividends paid by the Borrower in respect of its capital
stock during such fiscal year plus the aggregate purchase price paid by the
Borrower in respect of any repurchase or redemption of its capital stock during
such fiscal year. It is understood and agreed that the result of the calculation
above in subsection (b) in the immediately preceding sentence shall never be
less than zero.
6.3 Debt Service Reserve. The Borrower will not permit, as of any date on
or after the Closing Date, the ratio of (a) the Liquid Assets of the Borrower to
(b) the projected Debt Service in respect of Consolidated Indebtedness
outstanding as of such date for the four consecutive fiscal quarters immediately
following such date (excluding for these purposes the outstanding principal
amount of the Loans required to be repaid on the Maturity Date, but not the
projected Interest Expense in respect of such outstanding Loans) to be less than
the following: (a) 2.0:1, at any time that the Leverage Ratio is equal to or
greater than 0.35:1; (b) 1.75:1, at any time that the Leverage Ratio is less
than 0.35:1 but equal to or greater than 0.31:1; and (c) 1.5:1, at any time that
the Leverage Ratio is less than 0.31:1
6.4 Available Dividend Amount Coverage Ratio. The Borrower will not
permit the ratio of (a) the sum of the Available Dividend Amount for each
Insurance Subsidiary as of the last day of each fiscal year of the Borrower
ending after the Closing Date to (b) the projected Debt Service for the
immediately following fiscal year of the Borrower in respect of Consolidated
Indebtedness outstanding as of such date (excluding for these purposes the
outstanding principal amount of the Loans required to be repaid on the Maturity
Date, but not the projected Interest Expense in respect of such outstanding
Loans), to be less than 1.00:1.
ARTICLE VII
NEGATIVE COVENANTS
The Borrower covenants and agrees that, unless consent has been obtained
pursuant to Section 10.6, until the termination of the Commitments and the
payment in full of all principal
51
and interest with respect to the Loans together with all other amounts then due
and owing hereunder:
7.1 Indebtedness. The Borrower will not, and will not permit or cause any
of its Subsidiaries to, create, incur, assume or suffer to exist in any manner
any Indebtedness other than the following (collectively, "Permitted
Indebtedness"):
(i) Indebtedness incurred under this Agreement and the Notes;
(ii) Indebtedness of the Borrower to which the payment of the Loans
is senior or ranks pari passu, provided the creation, incurrence,
assumption or existence of such Indebtedness would not otherwise result in
a Default or Event of Default;
(iii) Indebtedness of the Borrower and its Subsidiaries existing as
of the date of this Agreement and described on Schedule 7.1;
(iv) Indebtedness of any Subsidiary owing to the Borrower or any
other Subsidiary;
(v) Indebtedness of any Subsidiary outstanding at the time such
Subsidiary becomes a Subsidiary and not incurred in contemplation thereof,
provided (x) the Indebtedness remains the sole obligation of such
Subsidiary and (y) the outstanding aggregate principal amount of such
Indebtedness is not voluntarily increased by such Subsidiary after the date
such Subsidiary becomes a Subsidiary of the Borrower;
(vi) Indebtedness of the Borrower or any Subsidiary incurred in
connection with the financing of any Acquisition, provided that (x) such
Indebtedness shall not exceed the cost of the Acquisition, (y) immediately
after giving effect thereto no Default or Event of Default shall have
occurred and be continuing and (z) such Indebtedness shall not be secured
by a Lien on the assets or property of the Borrower or any of its
Subsidiaries (other than (A) any Stock Acquisition Lien on the Capital
Stock of the Subsidiary the subject of such Acquisition or a Subsidiary
(other than any Material Subsidiary) organized by the Borrower or another
Subsidiary of the Borrower to effect such Acquisition and (B) any assets or
property of any such Subsidiary referred to in clause (A) or any of its
Subsidiaries);
(vii) Indebtedness of (x) the Borrower or any Subsidiary incurred in
connection with any Sale-Leaseback Transaction of fixed assets other than
real property, provided that all such Sale-Leaseback Transactions of fixed
assets other than real property of the Borrower and its Subsidiaries at
such time does not involve assets having an aggregate fair market value of
greater than $25,000,000, and (y) any Subsidiary incurred in connection
with Sale-Leaseback Transaction of any real property owned by any
Subsidiary as of the date hereof;
(viii) Indebtedness of the Borrower or any Subsidiary under Hedge
Agreements entered into for bona fide hedging purposes;
52
(ix) Indebtedness of any Subsidiary incurred in the ordinary course
of its business in connection with letters of credit, appeal bonds or
collateral agreements, that are related to reinsurance obligations, loss or
claims payments under policies of insurance or other regulatory
requirements;
(x) Indebtedness of the Borrower and its Subsidiaries in
connection with letters of credit that have been collateralized in full;
and
(xi) purchase money Indebtedness incurred solely to finance the
payment of all or part of the purchase price of any equipment and
technology acquired in the ordinary course of business and real property
used for office purposes, including Indebtedness in respect of capital
lease obligations, and any renewals, refinancings or replacements thereof.
The restrictions contained in this Section 7.1 shall not apply to Unrestricted
Margin Stock.
7.2 Liens. The Borrower will not, and will not permit or cause any
Material Subsidiary to, enter into or suffer to exist any agreement that
creates, incurs, grants, or suffers to exist, any Lien to secure any
Indebtedness on the Capital Stock having ordinary voting power for the election
of directors, managing general partners or the equivalent of any Material
Subsidiary of the Borrower which Capital Stock is owned by the Borrower or any
Material Subsidiary without effectively providing that the Indebtedness under
this Agreement and the Notes (and if the Borrower so elects, any other
Indebtedness of the Borrower ranking on a parity with the Indebtedness under
this Agreement and the Notes) shall be secured equally and ratably with, or
prior to, any such secured Indebtedness so long as such Indebtedness remains
outstanding; provided, however, that this Section 7.2 shall not apply to Liens
securing Indebtedness permitted pursuant to Section 7.1(v) or (vi).
7.3 Merger, Acquisition, Sale of Assets and Liquidation. The Borrower
will not, and will not permit or cause any Material Subsidiary to, enter into
any merger or consolidation with any Pledged Subsidiary, and the Borrower will
not, and will not permit or cause any Subsidiary whose assets (excluding
intercompany accounts) comprise greater than ten percent (10%) of Consolidated
Total Assets, to wind up, liquidate or dissolve its affairs, or enter into any
transaction of merger or consolidation with any other Person, or sell or
otherwise dispose of all or substantially all of its assets to any other Person;
provided, however, that
(i) the Borrower may merge or consolidate with any Subsidiary
(other than a Pledged Subsidiary) or other Person incorporated under the
laws of a State of the United States, provided that (x) the Borrower, is
the surviving corporation or, and (y) immediately after giving effect
thereto no Default or Event of Default shall have occurred and be
continuing;
(ii) any Subsidiary (other than a Pledged Subsidiary) may be merged
or consolidated into, or may be liquidated into, or may sell, lease or
transfer assets to, the Borrower or a Wholly-Owned Subsidiary (other than a
Pledged Subsidiary), provided that (x) in the case of a merger or
consolidation, the Borrower or the Wholly-Owned
53
Subsidiary is the surviving corporation and (y) immediately after giving
effect thereto no Default or Event of Default shall have occurred and be
continuing;
(iii) the Borrower or any Subsidiary may sell or otherwise dispose
of any of its assets to the Borrower or another Subsidiary (other than an
Excluded Subsidiary), provided that immediately after giving effect
thereto, no Default or Event of Default would exist;
(iv) the Borrower and any Subsidiary may dispose of all or any
portion of the Capital Stock of AIIC, and AIIC may dispose of all or any
portion of its assets;
(v) the Borrower and any Subsidiary may sell or otherwise dispose
of assets in connection with a Sale-Leaseback Transaction, provided that
immediately after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing; and
(vi) the Borrower and any Subsidiary may sell or otherwise dispose
of investments (other than investments in any Subsidiary) in the ordinary
course of business.
The restrictions contained in this Section 7.3 relating to the sale, lease,
assignment, distribution and disposal of assets shall not apply to Unrestricted
Margin Stock.
7.4 Acquisitions; Investments. The Borrower will not, and will not permit
or cause any of its Subsidiaries to, (i) effect an Acquisition of any Person if
(x) immediately after giving effect thereto, a Default or Event of Default shall
have occurred and be continuing or (y) such Person is not primarily engaged in
the property and casualty insurance or property and casualty insurance-related
businesses, or (ii) make, or permit to exist, any loans, advances or other
extensions of credit to any employees of the Borrower or its Subsidiaries (other
than loans or advances for the purpose of purchasing Capital Stock of the
Borrower) if the aggregate principal amount of all such loans and advances by
the Borrower and its Subsidiaries to such employees is greater than $10,000,000.
7.5 Transactions with Excluded Subsidiaries and Affiliates. The Borrower
will not, and will not permit or cause any Subsidiary to (i) sell, lease, assign
or otherwise transfer, directly or indirectly, any property or assets to an
Excluded Subsidiary, (ii) make any loan or other advance to an Excluded
Subsidiary, or (iii) enter into or be a party to any other transaction with an
Excluded Subsidiary or any Affiliate, except (x) loans, advances or other
extensions of credit permitted pursuant to Section 7.4(y)(ii), (y) mergers or
consolidations permitted pursuant to Section 7.3, or (z) the reasonable
requirements of its business and upon fair and reasonable terms that are no less
favorable to it than it would obtain in a comparable arm's length transaction
with an unrelated Person; provided, however, that nothing contained in this
Section 7.5 shall prohibit the Borrower or any Subsidiary from entering into a
transaction with an Excluded Subsidiary involving the transfer of insurance and
reinsurance risks as long as the transaction results in a true transfer of risk.
7.6 Use of Proceeds. The Borrower will not permit any of the proceeds of
the Loans to be used, directly or indirectly, in any manner which would cause
any Lender to violate Regulation U, and, without limiting the generality of the
foregoing, the Borrower will not permit more than 25% of the value of the assets
of the Borrower and its Subsidiaries, on a consolidated
54
basis, that are subject to the restrictions contained in Sections 7.2 and 7.3 to
be attributable to Margin Stock.
7.7 Certain Accounting Changes. The Borrower will not, and will not
permit or cause any Subsidiary to, change its fiscal year end or make, or permit
any of its Subsidiaries to make, any change in its accounting treatment and
reporting practices except as required by GAAP or SAP, as applicable.
7.8 No Other Negative Pledges. The Borrower will not, and will not permit
or cause any of its Subsidiaries (other than an Excluded Subsidiary) to,
directly or indirectly, enter into or suffer to exist any agreement or
restriction that prohibits or conditions the creation, incurrence or assumption
of any Lien upon or with respect to any part of its property or assets, whether
now owned or hereafter acquired, or agree to do any of the foregoing, other than
(a) any such agreement or restriction that only requires that an obligation
receive pari passu treatment with any such Lien or (b) as set forth in (i) this
Agreement, (ii) any agreement or instrument creating a Lien not otherwise
prohibited hereunder (but only to the extent such agreement or restriction
applies to the assets subject to such Lien), and (iii) operating leases of real
and personal property entered into by the Borrower or any of its Subsidiaries as
lessee in the ordinary course of business.
7.9 Additional Securities. The Borrower will not permit or cause any of
its Subsidiaries other than the Borrower or a Qualified Trust to issue any
equity or trust preferred securities after the date hereof other than to the
Borrower or any Subsidiary. The Borrower will not, and will not permit or cause
any Subsidiary or Qualified Trust to, issue any trust preferred securities that
are not Qualified Debt Obligations.
ARTICLE VIII
EVENTS OF DEFAULT
8.1 Events of Default. Each of the following shall constitute an Event of
Default, whatever the reason for such event and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any Governmental
Authority or otherwise:
(a) Default shall be made by the Borrower in the payment of any principal
due on any one or more of the Notes, when and as the same becomes due and
payable, whether at the stated maturity thereof, by mandatory prepayment, by
acceleration, demand or otherwise; or
(b) Default shall be made by the Borrower in the payment of any interest
due on any one or more of the Notes, any fee or any other Obligation when such
interest, fee or other Obligation is due and payable and such default shall
continue unremedied for a period of two (2) Business Days; or
(c) Default shall be made by the Borrower in the due observance or
performance of any term, covenant or agreement contained in Section 2.14, 7.1,
7.2, 7.3 or 7.4 or contained in Article VI; or
55
(d) Default shall be made by the Borrower in the due observance or
performance of any other term, covenant, or agreement contained in this
Agreement, and such default shall continue unremedied for a period of thirty
(30) days after the sending of written notice of such default to the Borrower by
the Administrative Agent; or
(e) Any representation or warranty made by the Borrower herein or any
statement or representation made in any certificate, report, or opinion
delivered pursuant hereto shall prove to have been incorrect in any material
respect when made; or
(f) The Borrower or any Material Subsidiary shall be generally not paying
its debts as such debts become due, shall become insolvent or unable to meet its
obligations as they mature; or
(g) The Borrower or any Material Subsidiary shall make an assignment for
the benefit of creditors, shall apply for or consent to the appointment of a
trustee, custodian or a receiver for itself or all or a substantial part of its
properties or assets, shall admit in writing its inability to pay its debts as
they mature, or take any corporate action to authorize any of the foregoing; or
(h) A trustee, receiver or custodian shall be appointed for the Borrower,
any Material Subsidiary or for a substantial part of any of their properties; or
(i) Any case in bankruptcy shall be commenced, or any reorganization,
arrangement, insolvency, or liquidation proceedings or any proceedings for other
relief under the Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect shall be instituted, by or
against the Borrower or any Material Subsidiary and, if commenced or instituted
against it, be consented to by the Borrower or such Material Subsidiary, as the
case may be, or remain undismissed and unstayed for a period of thirty (30) days
or an order, judgment or decree approving or ordering any of the foregoing shall
be entered in any such proceeding; or
(j) Any one or more final judgments (other than a judgment incurred by an
Insurance Subsidiary under or in connection with an insurance contract written
in the ordinary course of business) for the payment of money involving an
aggregate amount in excess of the Threshold Amount which is not adequately
insured or indemnified against shall be rendered against the Borrower, any
Subsidiary or any of their respective properties and the same shall remain
undischarged for a period of twenty (20) days during which time execution shall
not be effectively stayed; or
(k) Any default shall be made in the payment or performance of any other
obligation incurred in connection with any Indebtedness (other than Indebtedness
incurred pursuant to this Agreement) of the Borrower or any Subsidiary in excess
of the Threshold Amount, if the effect of such default is to permit the holder
of such Indebtedness (or a trustee on behalf of such holder) to cause it to
become due prior to its stated maturity or any such Indebtedness becomes due
prior to its stated maturity or shall not be paid when due; or
(l) Any Person or group of Persons (within the meaning of Section 13(d)
of the Securities Exchange Act of 1934, as amended), other than members of the
▇▇▇▇▇▇ family and trusts established by or for the benefit of members of the
▇▇▇▇▇▇ family, shall obtain ownership
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or control in one or more series of transactions of more than twenty-five
percent (25%) of the common stock and twenty-five percent (25%) of the voting
power of the Borrower entitled to vote in the election of members of the board
of directors of the Borrower, or there shall have occurred under any indenture
or other instrument evidencing any Indebtedness in excess of the Threshold
Amount any "change in control" (as defined in such indenture or other evidence
of Indebtedness) obligating the Borrower to repurchase, redeem or repay all or
any part of the Indebtedness or capital stock provided for therein; or
(m) Any substantial part of the properties of the Borrower or any
Material Subsidiary shall be sequestered or attached and shall not have been
returned to the possession of the Borrower or such Material Subsidiary, as the
case may be, or released from such attachment within thirty (30) days or in any
event later than five (5) days prior to the date of any proposed sale
thereunder; or
(n) The occurrence of any of the following events: (i) the Borrower or
any ERISA Affiliate fails to make full payment when due of all amounts which,
under the provisions of any Pension Plan or Section 412 of the Internal Revenue
Code, the Borrower or any ERISA Affiliate is required to pay as contributions
thereto other than an inadvertant failure to pay an amount not in excess of
$500,000 that is corrected as soon as possible, (ii) an accumulated funding
deficiency in excess of the Threshold Amount occurs or exists, whether or not
waived, with respect to any Pension Plan, (iii) a Termination Event shall occur,
or (iv) the Borrower or any ERISA Affiliate as employers under one or more
Multiemployer Plan makes a complete or partial withdrawal from any such
Multiemployer Plan and the plan sponsor of such Multiemployer Plans notifies
such withdrawing employer that such employer has incurred a withdrawal liability
requiring payments in an amount exceeding the Threshold Amount; or
(o) Any provision of this Agreement or any other Credit Document shall
for any reason cease to be valid and binding on the Borrower or the Borrower
shall so state in writing.
8.2 Remedies: Termination of Commitments, Acceleration, etc. Upon and at
any time after the occurrence and during the continuance of any Event of
Default, the Administrative Agent shall at the direction, or may with the
consent, of the Required Lenders, take any or all of the following actions at
the same or different times:
(a) Declare the principal of and interest on the Loans and the Notes at
the time outstanding, and all other amounts owed to the Lenders and to the
Administrative Agent under this Agreement or any of the other Credit Documents
and all other Obligations, to be forthwith due and payable, whereupon the same
shall immediately become due and payable without presentment, demand, protest or
other notice of any kind, all of which are expressly waived, anything in this
Agreement or the other Credit Documents to the contrary notwithstanding, and
terminate the Commitments and any right of the Borrower to request or receive
any Loans thereunder; provided that upon the occurrence of an Event of Default
specified in Section 8.1(g), 8.1(h) or 8.1(i), the Commitments and the
Borrower's right to receive Loans thereunder shall be automatically terminated
and all Obligations shall automatically become due and payable;
(b) Obtain, at the Borrower's expense and as soon as reasonably possible,
with respect to each Insurance Subsidiary, a current actuarial review and
valuation statement of, and
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opinion as to the adequacy of, such Insurance Subsidiary's loss and loss
adjustment expense reserve positions with respect to the insurance business then
in force, and covering such other subjects as are customary in actuarial reviews
and as may be requested by the Required Lenders, prepared by an independent
actuarial firm acceptable to the Required Lenders in accordance with reasonable
actuarial assumptions and procedures (the Borrower hereby agreeing to cooperate
in connection therewith); and
(c) Exercise on behalf of the Lenders all of its and their other rights
and remedies under this Agreement, the other Credit Documents and Applicable
Law, in order to satisfy all of the Obligations.
8.3 Remedies: Set-Off. In addition to all other rights and remedies
available under the Credit Documents or Applicable Law or otherwise, upon and at
any time after the occurrence and during the continuance of any Event of
Default, each Lender may, and each is hereby authorized by the Borrower, at any
such time and from time to time, to the fullest extent permitted by Applicable
Law, without presentment, demand, protest or other notice of any kind, all of
which are hereby knowingly and expressly waived by the Borrower, to set off and
to apply any and all deposits (general or special, time or demand, provisional
or final) and any other property at any time held (including at any branches or
agencies, wherever located), and any other indebtedness at any time owing, by
such Lender to or for the credit or the account of the Borrower against any or
all of the Obligations to such Lender now or hereafter existing, whether or not
such Obligations may be contingent or unmatured. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off and
application; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application.
ARTICLE IX
THE ADMINISTRATIVE AGENT
9.1 Appointment. Each Lender hereby irrevocably appoints and authorizes
SunTrust Bank to act as Administrative Agent hereunder and under the other
Credit Documents and to take such actions as administrative agent on its behalf
hereunder and under the other Credit Documents, and to exercise such powers and
to perform such duties, as are specifically delegated to the Administrative
Agent by the terms hereof or thereof, together with such other powers and duties
as are reasonably incidental thereto.
9.2 Nature of Duties. The Administrative Agent shall have no duties or
responsibilities other than those expressly set forth in this Agreement and the
other Credit Documents. The Administrative Agent shall not have, by reason of
this Agreement or any other Credit Document, a fiduciary relationship in respect
of any Lender; and nothing in this Agreement or any other Credit Document,
express or implied, is intended to or shall be so construed as to impose upon
the Administrative Agent any obligations or liabilities in respect of this
Agreement or any other Credit Document except as expressly set forth herein or
therein. The Administrative Agent may execute any of its duties under this
Agreement or any other Credit Document by or through agents or attorneys-in-fact
and shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact that it selects with reasonable care. The Administrative Agent
shall be entitled to consult with legal counsel, independent public
58
accountants and other experts selected by it with respect to all matters
pertaining to this Agreement and the other Credit Documents and its duties
hereunder and thereunder and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts. The Lenders hereby acknowledge that the Administrative
Agent shall not be under any duty to take any discretionary action permitted to
be taken by it pursuant to the provisions of this Agreement or any other Credit
Document unless it shall be requested in writing to do so by the Required
Lenders (or, where a higher percentage of the Lenders is expressly required
hereunder, such Lenders).
9.3 Exculpatory Provisions. Neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates
shall be (i) liable for any action taken or omitted to be taken by it or such
Person under or in connection with the Credit Documents, except for its or such
Person's own gross negligence or willful misconduct, (ii) responsible in any
manner to any Lender for any recitals, statements, information, representations
or warranties herein or in any other Credit Document or in any document,
instrument, certificate, report or other writing delivered in connection
herewith or therewith, for the execution, effectiveness, genuineness, validity,
enforceability or sufficiency of this Agreement or any other Credit Document, or
for the financial condition of the Borrower any of its Subsidiaries or any other
Person, or (iii) required to ascertain or make any inquiry concerning the
performance or observance of any of the terms, provisions or conditions of this
Agreement or any other Credit Document or the existence or possible existence of
any Default or Event of Default, or to inspect the properties, books or records
of the Borrower or any of its Subsidiaries.
9.4 Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any notice,
statement, consent or other communication (including, without limitation, any
thereof by telephone, telecopy, telex, telegram or cable) believed by it in good
faith to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons. The Administrative Agent may deem and treat each
Lender as the owner of its interest hereunder for all purposes hereof unless and
until a written notice of the assignment, negotiation or transfer thereof shall
have been given to the Administrative Agent in accordance with the provisions of
this Agreement. The Administrative Agent shall be entitled to refrain from
taking or omitting to take any action in connection with this Agreement or any
other Credit Document (i) if such action or omission would, in the reasonable
opinion of the Administrative Agent, violate any Applicable Law or any provision
of this Agreement or any other Credit Document or (ii) unless and until it shall
have received such advice or concurrence of the Required Lenders (or, where a
higher percentage of the Lenders is expressly required hereunder, such Lenders)
as it deems appropriate or it shall first have been indemnified to its
satisfaction by the Lenders against any and all liability and expense (other
than liability and expense arising from its own gross negligence or willful
misconduct) that may be incurred by it by reason of taking, continuing to take
or omitting to take any such action. Without limiting the foregoing, no Lender
shall have any right of action whatsoever against the Administrative Agent as a
result of the Administrative Agent's acting or refraining from acting hereunder
or under any other Credit Document in accordance with the instructions of the
Required Lenders (or, where a higher percentage of the Lenders is expressly
required hereunder, such Lenders), and such instructions and any action taken or
failure to act pursuant thereto shall be binding upon all of the Lenders
(including all subsequent Lenders).
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9.5 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Administrative Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates has made
any representation or warranty to it and that no act by the Administrative Agent
or any such Person hereinafter taken, including any review of the affairs of the
Borrower and its Subsidiaries, shall be deemed to constitute any representation
or warranty by the Administrative Agent to any Lender. Each Lender represents to
the Administrative Agent that (i) it has, independently and without reliance
upon the Administrative Agent or any other Lender and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, properties, financial
and other condition and creditworthiness of the Borrower, and its Subsidiaries
and made its own decision to enter into this Agreement and extend credit to the
Borrower hereunder, and (ii) it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action
hereunder and under the other Credit Documents and to make such investigation as
it deems necessary to inform itself as to the business, prospects, operations,
properties, financial and other condition and creditworthiness of the Borrower,
and its Subsidiaries. Except as expressly provided in this Agreement and the
other Credit Documents, the Administrative Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information concerning the business, prospects,
operations, properties, financial or other condition or creditworthiness of the
Borrower and its Subsidiaries or any other Person that may at any time come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
9.6 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent shall have received written notice from the
Borrower or a Lender referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default." In the
event that the Administrative Agent receives such a notice, the Administrative
Agent will give notice thereof to the Lenders as soon as reasonably practicable;
provided, however, that if any such notice has also been furnished to the
Lenders, the Administrative Agent shall have no obligation to notify the Lenders
with respect thereto. The Administrative Agent shall (subject to Sections 9.4
and 10.6) take such action with respect to such Default or Event of Default as
shall reasonably be directed by the Required Lenders; provided that, unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders except
to the extent that this Agreement expressly requires that such action be taken,
or not be taken, only with the consent or upon the authorization of the Required
Lenders or all of the Lenders.
9.7 Indemnification. To the extent the Administrative Agent is not
reimbursed by or on behalf of the Borrower, and without limiting the obligation
of the Borrower to do so, the Lenders agree (i) to indemnify the Administrative
Agent and its officers, directors, employees, agents, attorneys-in-fact and
Affiliates, ratably in proportion to their respective percentages as used in
determining the Required Lenders as of the date of determination, from and
against any
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and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including, without limitation, attorneys'
fees and expenses) or disbursements of any kind or nature whatsoever that may at
any time (including, without limitation, at any time following the repayment in
full of the Loans and the termination of the Commitments) be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of this Agreement or any other Credit Document or any documents
contemplated by or referred to herein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing, and (ii) to reimburse the Administrative
Agent upon demand, ratably in proportion to their respective percentages as used
in determining the Required Lenders as of the date of determination, for any
expenses incurred by the Administrative Agent in connection with the
preparation, negotiation, execution, delivery, administration, amendment,
modification, waiver or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement or any of the other Credit Documents
(including, without limitation, reasonable attorneys' fees and expenses and
compensation of agents and employees paid for services rendered on behalf of the
Lenders); provided, however, that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements to the extent resulting from the gross
negligence or willful misconduct of the party to be indemnified.
9.8 The Administrative Agent in its Individual Capacity. With respect to
its Commitment, the Loans made by it and the Note or Notes issued to it, the
Administrative Agent in its individual capacity and not as Administrative Agent
shall have the same rights and powers under the Credit Documents as any other
Lender and may exercise the same as though it were not performing the agency
duties specified herein; and the terms "Lenders," "Required Lenders," "holders
of Notes" and any similar terms shall, unless the context clearly otherwise
indicates, include the Administrative Agent in its individual capacity. The
Administrative Agent and its Affiliates may accept deposits from, lend money to,
make investments in, and generally engage in any kind of banking, trust,
financial advisory or other business with the Borrower and its Subsidiaries or
any of its Affiliates as if the Administrative Agent were not performing the
agency duties specified herein, and may accept fees and other consideration from
any of them for services in connection with this Agreement and otherwise without
having to account for the same to the Lenders.
9.9 Successor Administrative Agent. The Administrative Agent may resign
at any time by giving thirty (30) days' prior written notice to the Borrower and
the Lenders. Upon any such notice of resignation, the Required Lenders will,
with the prior written consent of the Borrower (which consent shall not be
unreasonably withheld), appoint from among the Lenders a successor to the
Administrative Agent (provided that the Borrower's consent shall not be required
in the event a Default or Event of Default shall have occurred and be
continuing). If no successor to the Administrative Agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within such thirty-day period, then the retiring Administrative Agent may, on
behalf of the Lenders and after consulting with the Lenders and the Borrower,
appoint a successor Administrative Agent from among the Lenders. Upon the
acceptance of any appointment as Administrative Agent by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring
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Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Credit Documents. After any retiring
Administrative Agent's resignation as Administrative Agent, 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 Administrative Agent. If no successor to the
Administrative Agent has accepted appointment as Administrative Agent by the
thirtieth (30th) day following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
thereupon become effective, and the Lenders shall thereafter perform all of the
duties of the Administrative Agent hereunder and under the other Credit
Documents until such time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided for hereinabove.
ARTICLE X
MISCELLANEOUS
10.1 Fees and Expenses. The Borrower agrees (i) whether or not the
transactions contemplated by this Agreement shall be consummated, to pay upon
demand all reasonable out-of-pocket costs and expenses of the Administrative
Agent (including, without limitation, the reasonable fees and expenses of
counsel to the Administrative Agent) in connection with the Administrative
Agent's due diligence investigation in connection with, and the preparation,
negotiation, execution and delivery of, this Agreement and the other Credit
Documents, and any amendment, modification or waiver hereof or thereof or
consent with respect hereto or thereto, (ii) to pay upon demand all reasonable
out-of-pocket costs and expenses of the Administrative Agent and each Lender
(including, without limitation, reasonable attorneys' fees and expenses) in
connection with the enforcement of any rights or remedies under this Agreement
or any of the other Credit Documents, whether in any action, suit or proceeding
(including any bankruptcy or insolvency proceeding) or otherwise, and (iii) to
pay and hold the Administrative Agent and each Lender harmless from and against
all liability for any intangibles, documentary, stamp or other similar taxes,
fees and excises, if any, including any interest and penalties, and any finder's
or brokerage fees, commissions and expenses (other than any fees, commissions or
expenses of finders or brokers engaged by the Administrative Agent or any
Lender), that may be payable in connection with the transactions contemplated by
this Agreement and the other Credit Documents.
10.2 Indemnification. The Borrower agrees, whether or not the transactions
contemplated by this Agreement shall be consummated, to indemnify and hold the
Administrative Agent and each Lender and each of their respective directors,
officers, employees, agents and Affiliates (each, an "Indemnified Person")
harmless from and against any and all claims, losses, damages, obligations,
liabilities, penalties, costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) of any kind or nature whatsoever,
whether direct, indirect or consequential (collectively, "Indemnified Costs"),
that may at any time be imposed on, incurred by or asserted against any such
Indemnified Person as a result of, arising from or in any way relating to the
preparation, execution, performance or enforcement of this Agreement or any of
the other Credit Documents, any of the transactions contemplated herein or
therein or any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Loans; provided, however, that
no Indemnified Person shall have the right to be indemnified hereunder for any
Indemnified Costs to the extent directly resulting from the gross negligence or
willful misconduct of such Indemnified Person. All of the
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foregoing Indemnified Costs of any Indemnified Person shall be paid or
reimbursed by the Borrower, as and when incurred and upon demand.
10.3 Governing Law; Consent to Jurisdiction. THIS AGREEMENT AND THE OTHER
CREDIT DOCUMENTS HAVE BEEN EXECUTED, DELIVERED AND ACCEPTED IN, AND SHALL BE
DEEMED TO HAVE BEEN MADE IN, VIRGINIA AND SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA (WITHOUT
REGARD TO THE CONFLICTS OF LAW PROVISIONS THEREOF); THE BORROWER HEREBY CONSENTS
TO THE NONEXCLUSIVE JURISDICTION OF ANY STATE COURT WITHIN THE COMMONWEALTH OF
VIRGINIA OR ANY FEDERAL COURT LOCATED WITHIN THE EASTERN DISTRICT OF THE
COMMONWEALTH OF VIRGINIA FOR ANY PROCEEDING INSTITUTED HEREUNDER OR UNDER ANY OF
THE OTHER CREDIT DOCUMENTS, OR ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, OR ANY PROCEEDING TO WHICH THE
ADMINISTRATIVE AGENT OR ANY LENDER OR THE BORROWER IS A PARTY, INCLUDING ANY
ACTIONS BASED UPON, ARISING OUT OF, OR IN CONNECTION WITH ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT OR ANY LENDER OR THE BORROWER. THE BORROWER IRREVOCABLY
AGREES TO BE BOUND (SUBJECT TO ANY AVAILABLE RIGHT OF APPEAL) BY ANY JUDGMENT
RENDERED OR RELIEF GRANTED THEREBY AND FURTHER WAIVES ANY OBJECTION THAT IT MAY
HAVE BASED ON LACK OF JURISDICTION OR IMPROPER VENUE OR FORUM NON CONVENIENS TO
THE CONDUCT OF ANY SUCH PROCEEDING. THE BORROWER CONSENTS THAT ALL SERVICE OF
PROCESS BE MADE BY REGISTERED OR CERTIFIED MAIL DIRECTED TO IT AT ITS ADDRESS
SET FORTH HEREINBELOW, AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON
THE EARLIER OF ACTUAL RECEIPT THEREOF OR THREE (3) BUSINESS DAYS AFTER DEPOSIT
IN THE UNITED STATES MAILS, PROPER POSTAGE PREPAID AND PROPERLY ADDRESSED.
NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT TO SERVE LEGAL PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT OR
ANY LENDER TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER IN THE COURTS
OF ANY OTHER JURISDICTION.
10.4 Waiver of Jury Trial. EACH OF THE BORROWER AND EACH LENDER HEREBY
WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ITS RESPECTIVE RIGHTS TO
TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, OR ANY PROCEEDING TO
WHICH THE BORROWER OR ANY LENDER IS A PARTY, INCLUDING ANY ACTIONS BASED UPON,
ARISING OUT OF, OR IN CONNECTION WITH ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE BORROWER OR ANY LENDER.
The scope of this waiver is intended to be all-encompassing of any and all
disputes that may be filed in any court and that relate to the subject matter of
this transaction, including, without limitation, contract claims, tort claims,
breach of duty claims and all other common law and statutory claims. Each of the
Borrower and each Lender
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(i) acknowledges that this waiver is a material inducement to enter into a
business relationship, that it has relied on this waiver in entering into this
Agreement, and that it will continue to rely on this waiver in its related
future dealings with the other parties hereto, and (ii) further warrants and
represents that it has reviewed this waiver with its legal counsel and that,
based upon such review, it knowingly and voluntarily waives its jury trial
rights to the extent permitted by applicable law. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, MODIFICATIONS OR SUPPLEMENTS TO OR
RESTATEMENTS OF THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS. IN THE
EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.
10.5 Notices.
(a) All notices and other communications provided for hereunder shall be
in writing (including facsimile transmission) and mailed, telecopied, or
delivered to the party to be notified at the following addresses:
(i) if to the Borrower, to ▇▇▇▇▇▇ Corporation, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Website Address, ▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇,
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, e-mail address,
▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇, with a copy to ▇▇▇▇▇▇ Corporation, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Telecopy
(▇▇▇) ▇▇▇-▇▇▇▇, e-mail address, ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇;
(ii) if to the Administrative Agent, to SunTrust Bank, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇,
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, e-mail address, ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇;
with all payments to the Administrative Agent by wire transfer to be made
to Bankers Trust Company; ABA #: ▇▇▇-▇▇▇-▇▇▇; Credit: SunTrust Agency
Account; Account #: ▇▇-▇▇▇-▇▇▇; Attention: ▇▇▇▇▇ ▇▇▇▇▇▇; Reference: ▇▇▇▇▇▇
Corp.; and
(iii) if to any Lender, to it at the address set forth on its
signature page hereto (or if to any Lender not a party hereto as of the
date hereof, at the address set forth in its Assignment and Acceptance);
or in each case, to such other address as any party may designate for itself by
like notice to all other parties hereto.
(b) All such notices and communications shall be deemed to have been
given (i) if mailed as provided above by any method other than overnight
delivery service, on the third Business Day after deposit in the mails, (ii) if
mailed by overnight delivery service, or telecopied, when delivered for
overnight delivery or transmitted by telecopier, respectively, (iii) if
delivered by hand, upon delivery, or (iv) if delivered by electronic mail, when
delivered; provided that notices and communications to the Administrative Agent
shall not be effective until received by the Administrative Agent.
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(c) Notwithstanding anything to the contrary set forth herein, to the
extent practicable, each delivery of financial statements and other reports and
deliverables (other than signed certificates) to a Lender pursuant to Article V
may be made by e-mail transmission or other similar means and, except as
otherwise provided in Section 5.1(e), shall be deemed delivered when received by
such Lender.
10.6 Amendments, Waivers, etc. No amendment, modification, waiver or
discharge or termination of, or consent to any departure by the Borrower from,
any provision of this Agreement or any other Credit Document, shall be effective
unless in a writing signed by the Required Lenders (or by the Administrative
Agent at the direction or with the consent of the Required Lenders), and then
the same shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment,
modification, waiver, discharge, termination or consent shall:
(a) unless agreed to by each Lender directly affected thereby, (i) reduce
or forgive the principal amount of any Loan, reduce the rate of or forgive any
interest thereon, or reduce or forgive any fees or other Obligations (other than
fees payable to the Administrative Agent for its own account), or (ii) extend
the Maturity Date or any other date fixed for the payment of any principal of or
interest on any Loan (other than additional interest payable under Section
2.8(b) at the election of the Required Lenders, as provided therein), any fees
(other than fees payable to the Administrative Agent for its own account) or any
other Obligations;
(b) unless agreed to by all of the Lenders, (i) increase (except as
provided pursuant to Section 2.20) or extend any Commitment of any Lender (it
being understood that a waiver of any Event of Default, if agreed to by the
requisite Lenders hereunder, shall not constitute such an increase), (ii)
increase the Aggregate Commitments pursuant to Section 2.20 or otherwise to an
aggregate amount in excess of $300,000,000, (iii) change the percentage of the
aggregate Commitments or of the aggregate unpaid principal amount of the Loans,
or the number or percentage of Lenders, that shall be required for the Lenders
or any of them to take or approve, or direct the Administrative Agent to take,
any action hereunder (including as set forth in the definition of "Required
Lenders"), or (iv) change any provision of Section 2.15 or this Section; and
(c) unless agreed to by the Administrative Agent in addition to the
Lenders required as provided hereinabove to take such action, affect the
respective rights or obligations the Administrative Agent, as applicable,
hereunder or under any of the other Credit Documents;
and provided further that the Fee Letter may be amended or modified, and any
rights thereunder waived, in a writing signed by the parties thereto.
10.7 Assignments, Participations.
(a) Each Lender may assign to one or more other Eligible Assignees (each,
an "Assignee") all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
the outstanding Loans made by it and the Note or Notes held by it); provided,
however, that (i) any such assignment (other than an assignment to a Lender or
an Affiliate of a Lender) shall not be made without the prior written
65
consent of the Administrative Agent and the Borrower (to be evidenced by its
counterexecution of the relevant Assignment and Acceptance), which consent shall
not be unreasonably withheld (provided that the Borrower's consent shall not be
required in the event a Default or Event of Default shall have occurred and be
continuing), (ii) each such assignment shall be of a uniform, and not varying,
percentage of all of the assigning Lender's rights and obligations under this
Agreement, (iii) except in the case of an assignment to a Lender or an Affiliate
of a Lender, no such assignment shall be in an aggregate principal amount
(determined as of the date of the Assignment and Acceptance with respect to such
assignment) less than $10,000,000, determined by combining the amount of the
assigning Lender's outstanding Loans, and Unutilized Commitment being assigned
pursuant to such assignment (or, if less, the entire Commitment of the assigning
Lender), and (iv) the parties to each such assignment will execute and deliver
to the Administrative Agent, for its acceptance and recording in the Register,
an Assignment and Acceptance, together with any Note or Notes subject to such
assignment, and will pay a nonrefundable processing fee of $3,500 to the
Administrative Agent for its own account. Upon such execution, delivery,
acceptance and recording of the Assignment and Acceptance, from and after the
effective date specified therein, which effective date shall be at least five
Business Days after the execution thereof (unless the Administrative Agent shall
otherwise agree), (A) the Assignee thereunder shall be a party hereto and, to
the extent that rights and obligations hereunder have been assigned to it
pursuant to such Assignment and Acceptance, shall have the rights and
obligations of the assigning Lender hereunder with respect thereto and (B) the
assigning Lender shall, to the extent that rights and obligations hereunder have
been assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights (other than rights under the provisions of this Agreement and the other
Credit Documents relating to indemnification or payment of fees, costs and
expenses, to the extent such rights relate to the time prior to the effective
date of such Assignment and Acceptance) and be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all or the remaining portion of such assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto). The terms
and provisions of each Assignment and Acceptance shall, upon the effectiveness
thereof, be incorporated into and made a part of this Agreement, and the
covenants, agreements and obligations of each Lender set forth therein shall be
deemed made to and for the benefit of the Administrative Agent and the other
parties hereto as if set forth at length herein.
(b) The Administrative Agent will maintain at its address for notices
referred to herein a copy of each Assignment and Acceptance delivered to and
accepted by it (and of each Joinder Agreement entered into pursuant to Section
2.20) and a register for the recordation of the names and addresses of the
Lenders and the Commitments of, and principal amount of the Loans owing to, each
Lender from time to time (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower and
each Lender at any reasonable time and from time to time upon reasonable prior
notice.
(c) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an Assignee and, if required,
counterexecuted by the Borrower, together with the Note or Notes subject to such
assignment and the processing fee referred to in
66
subsection (a) above, the Administrative Agent will (i) accept such Assignment
and Acceptance, (ii) on the effective date thereof, record the information
contained therein in the Register and (iii) give notice thereof to the Borrower
and the Lenders. Within five (5) Business Days after its receipt of such notice,
the Borrower, at its own expense, will execute and deliver to the Administrative
Agent, in exchange for the surrendered Note or Notes, a new Note or Notes to the
order of the Assignee (and, if the assigning Lender has retained any portion of
its rights and obligations hereunder, to the order of the assigning Lender),
prepared in accordance with the provisions of Section 2.4 as necessary to
reflect, after giving effect to the assignment, the Commitments of the Assignee
and (to the extent of any retained interests) the assigning Lender, dated the
date of the replaced Note or Notes and otherwise in substantially the form of
Exhibit A. The Administrative Agent will return canceled Notes to the Borrower.
(d) Each Lender may, with the prior written consent of the Borrower,
(which shall not be unreasonably withheld), sell to one or more other Persons
(each, a "Participant") participations in any portion comprising an aggregate
principal amount of more than $10,000,000 but less than all of its rights and
obligations under this Agreement (including, without limitation, a portion of
its Commitment, the outstanding Loans made by it, the Note or Notes held by it);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged and such Lender shall remain solely responsible for the
performance of such obligations, (ii) no Lender shall sell any participation
that, when taken together with all other participations, if any, sold by such
Lender, covers all of such Lender's rights and obligations under this Agreement,
(iii) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and no Lender shall permit
any Participant to have any voting rights or any right to control the vote of
such Lender with respect to any amendment, modification, waiver, consent or
other action hereunder or under any other Credit Document (except as to actions
that would (x) reduce or forgive the principal amount of any Loan, reduce the
rate of or forgive any interest thereon, or reduce or forgive any fees or other
Obligations, (y) extend the Maturity Date or any other date fixed for the
payment of any principal of or interest on any Loan, any fees or any other
Obligations, or (z) increase or extend any Commitment of any Lender), and (iv)
no Participant shall have any rights under this Agreement or any of the other
Credit Documents, each Participant's rights against the granting Lender in
respect of any participation to be those set forth in the participation
agreement, and all amounts payable by the Borrower hereunder shall be determined
as if such Lender had not granted such participation. Notwithstanding the
foregoing, each Participant shall have the rights of a Lender for purposes of
Sections 2.16(a), 2.16(b), 2.17, 2.18 and 8.3, and shall be entitled to the
benefits thereto, to the extent that the Lender granting such participation
would be entitled to such benefits if the participation had not been made,
provided that no Participant shall be entitled to receive any greater amount
pursuant to any of such Sections than the Lender granting such participation
would have been entitled to receive in respect of the amount of the
participation made by such Lender to such Participant had such participation not
been made.
(e) Nothing in this Agreement shall be construed to prohibit any Lender
from pledging or assigning all or any portion of its rights and interest
hereunder or under any Note to any Federal Reserve Bank as security for
borrowings therefrom; provided, however, that no such pledge or assignment shall
release a Lender from any of its obligations hereunder.
67
(f) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section,
disclose to the Assignee or Participant or proposed Assignee or Participant any
information relating to the Borrower and its Subsidiaries furnished to it by or
on behalf of any other party hereto, provided that such Assignee or Participant
or proposed Assignee or Participant agrees in writing to keep such information
confidential to the same extent required of the Lenders under Section 10.13.
10.8 No Waiver. The rights and remedies of the Administrative Agent and
the Lenders expressly set forth in this Agreement and the other Credit Documents
are cumulative and in addition to, and not exclusive of, all other rights and
remedies available at law, in equity or otherwise. No failure or delay on the
part of the Administrative Agent or any Lender in exercising any right, power or
privilege shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or privilege preclude other or further
exercise thereof or the exercise of any other right, power or privilege or be
construed to be a waiver of any Default or Event of Default. No course of
dealing between any of the Borrower and the Administrative Agent or the Lenders
or their agents or employees shall be effective to amend, modify or discharge
any provision of this Agreement or any other Credit Document or to constitute a
waiver of any Default or Event of Default. No notice to or demand upon the
Borrower in any case shall entitle the Borrower to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the right
of the Administrative Agent or any Lender to exercise any right or remedy or
take any other or further action in any circumstances without notice or demand.
10.9 Successors and Assigns. This Agreement shall be binding upon, inure
to the benefit of and be enforceable by the respective successors and assigns of
the parties hereto, and all references herein to any party shall be deemed to
include its successors and assigns; provided, however, that (i) the Borrower
shall not sell, assign or transfer any of its rights, interests, duties or
obligations under this Agreement without the prior written consent of all of the
Lenders and (ii) any Assignees and Participants shall have such rights and
obligations with respect to this Agreement and the other Credit Documents as are
provided for under and pursuant to the provisions of Section 10.7.
10.10 Survival. In addition, notwithstanding anything herein or under
Applicable Law to the contrary, the provisions of this Agreement and the other
Credit Documents relating to indemnification or payment of fees, costs and
expenses, including, without limitation, the provisions of Sections 2.16(a),
2.16(b), 2.17, 2.18, 9.7, 10.1 and 10.2, shall survive the payment in full of
all Loans, the termination of the Commitments, and any termination of this
Agreement or any of the other Credit Documents.
10.11 Severability. To the extent any provision of this Agreement is
prohibited by or invalid under the Applicable Law of any jurisdiction, such
provision shall be ineffective only to the extent of such prohibition or
invalidity and only in such jurisdiction, without prohibiting or invalidating
such provision in any other jurisdiction or the remaining provisions of this
Agreement in any jurisdiction.
10.12 Construction. The headings of the various articles, sections and
subsections of this Agreement have been inserted for convenience only and shall
not in any way affect the
68
meaning or construction of any of the provisions hereof. Except as otherwise
expressly provided herein and in the other Credit Documents, in the event of any
inconsistency or conflict between any provision of this Agreement and any
provision of any of the other Credit Documents, the provision of this Agreement
shall control.
10.13 Confidentiality. Each Lender agrees to keep confidential, pursuant to
its customary procedures for handling confidential information of a similar
nature and in accordance with safe and sound banking practices, all nonpublic
information provided to it by or on behalf of the Borrower, or any of its
Subsidiaries in connection with this Agreement or any other Credit Document;
provided, however, that any Lender may disclose such information (i) to its
directors, employees and agents and to its auditors, counsel and other
professional advisors, (ii) at the demand or request of any bank regulatory
authority, court or other Governmental Authority having or asserting
jurisdiction over such Lender, as may be required pursuant to subpoena or other
legal process, or otherwise in order to comply with any Applicable Law, (iii) in
connection with any proceeding to enforce its rights hereunder or under any
other Credit Document or any other litigation or proceeding related hereto or to
which it is a party, (iv) to the Administrative Agent or any other Lender, (v)
to the extent the same has become publicly available other than as a result of a
breach of this Agreement and (vi) pursuant to and in accordance with the
provisions of Section 10.7(f). Notwithstanding anything herein to the contrary,
the Administrative Agent, each Lender and the Borrower may disclose without
limitation of any kind, any information with respect to the "tax treatment" and
"tax structure" (in each case, within the meaning of Treasury Regulation
1.6011-4) of the transactions contemplated hereby and all materials of any kind
(including opinions or other tax analyses) that are provided to the
Administrative Agent, such Lender or the Borrower relating to such tax treatment
and tax structure; provided that with respect to any document or similar item
that in either case contains information concerning the tax treatment or tax
structure of the transaction as well as other information, this sentence shall
only apply to such portions of the document or similar item that relate to the
tax treatment or tax structure of the Loans and transactions contemplated
hereby.
10.14 Counterparts; Effectiveness. This Agreement may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument. This Agreement
shall become effective upon the execution of a counterpart hereof by each of the
parties hereto and receipt by the Administrative Agent and the Borrower of
written or telephonic notification of such execution and authorization of
delivery thereof.
10.15 Disclosure of Information. The Borrower agrees and consents to the
Administrative Agent's disclosure of information relating to this transaction to
Gold Sheets and other similar bank trade publications. Such information will
consist of deal terms and other information customarily found in such
publications. The Borrower shall have the right to review and approve such
disclosure and any other public announcement made by the Administrative Agent
before such announcement or disclosure is made (such approval not to be
unreasonably withheld).
10.16 Entire Agreement. THIS AGREEMENT, THE FEE LETTER AND THE OTHER CREDIT
DOCUMENTS EXECUTED AND DELIVERED IN CONNECTION HEREWITH (A) EMBODY THE ENTIRE
AGREEMENT AND UNDERSTANDING
69
BETWEEN THE PARTIES HERETO AND THERETO RELATING TO THE SUBJECT MATTER HEREOF AND
THEREOF, (B) SUPERSEDE ANY AND ALL PRIOR AGREEMENTS AND UNDERSTANDINGS OF SUCH
PERSONS, ORAL OR WRITTEN, RELATING TO THE SUBJECT MATTER HEREOF, AND (C) MAY NOT
BE AMENDED, SUPPLEMENTED, CONTRADICTED OR OTHERWISE MODIFIED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
[Signature Pages follow.]
70
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
▇▇▇▇▇▇ CORPORATION
By: __________________________________
Name:
Title:
(signatures continued)
SUNTRUST BANK, as Administrative Agent
and as a Lender
By: ____________________________________
Commitment: Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
$75,000,000 Title: Director
Pro Rata Share:
0.340909090%
Address for notices as a Lender:
SunTrust Bank
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: 404.724.3879
e-mail: ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇
@▇▇▇▇▇▇▇▇.▇▇▇
Lending Office: Same.
(signatures continued)
BARCLAYS BANK PLC, as a Lender
By: ____________________________________
Commitment: Name:
$75,000,000 Title:
Pro Rata Share:
0.340909090%
Address for notices:
Barclays Bank Plc
Global Services ▇▇▇▇
▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇▇.▇▇▇▇
Telecopy: 020.7773.6807
e-mail: ▇▇▇▇-▇▇▇▇.colgate
@▇▇▇▇▇▇.▇▇▇
Lending Office: Same.
(signatures continued)
THE NORTHERN TRUST COMPANY, as a
Lender
By: ____________________________________
Commitment: Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
$30,000,000 Title: Vice President
Pro Rata Share:
0.136363636%
Address for notices (Financial
Statements/Covenant Compliance Address for notices (Loan
and other documentation matters): Draws/Repayments and other
administrative matters):
The Northern Trust Company The Northern Trust Company
Mail Code: L-8 Mail Code: C4N
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
e-mail: ▇▇▇▇@▇▇▇▇.▇▇▇ e-mail: ▇▇▇▇@▇▇▇▇.▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
e-mail: ▇▇▇▇@▇▇▇▇.▇▇▇
Lending Office: The Northern Trust
Company
▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(signatures continued)
WACHOVIA BANK, NATIONAL ASSOCIATION,
as a Lender
By: ____________________________________
Commitment: Name:
$40,000,000 Title:
Pro Rata Share:
0.181818181%
Address for notices:
Wachovia Bank, National Association
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇/▇▇/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Lowndes ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
e-mail: lowndes.▇▇▇▇▇
@▇▇▇▇▇▇▇▇.▇▇▇
Lending Office: Same.
(signatures continued)
