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Exhibit 10.3
CONFORMED COPY
364 DAY
CREDIT AGREEMENT
dated as of
April 12, 2000
among
Nortel Networks Corporation,
as Guarantor,
Nortel Networks Inc.,
as Borrower
The Banks Party Hereto,
including
ABN AMRO Bank N.V.,
Bank of America, N.A.
and
Citibank N.A.,
as Co-Syndication Agents,
and
▇▇▇▇▇▇ Guaranty Trust Company of New York,
as Administrative Agent
------------------------------------------
Arranged by
▇.▇. ▇▇▇▇▇▇ Securities Inc.,
as Sole Lead Arranger
and Bookrunner
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions.............................................1
SECTION 1.02. Accounting Terms and Determinations....................10
SECTION 1.03. Types of Borrowings....................................10
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend....................................11
SECTION 2.02. Notice of Committed Borrowing..........................11
SECTION 2.03. Money Market Borrowings................................12
SECTION 2.04. Notice to Banks; Funding of Loans......................16
SECTION 2.05. Notes..................................................17
SECTION 2.06. Maturity of Loans......................................18
SECTION 2.07. Interest Rates.........................................18
SECTION 2.08. Fees...................................................21
SECTION 2.09. Optional Termination or Reduction of Commitments.......21
SECTION 2.10. Method of Electing Interest Rates......................21
SECTION 2.11. Optional Prepayments...................................22
SECTION 2.12. General Provisions as to Payments......................23
SECTION 2.13. Funding Losses.........................................23
SECTION 2.14. Computation of Interest and Fees.......................24
SECTION 2.15. Judgment Currency......................................24
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing................................................25
SECTION 3.02. Borrowings.............................................25
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power..........................26
SECTION 4.02. Corporate and Governmental Authorization;
No Contravention.......................................27
SECTION 4.03. Binding Effect.........................................27
SECTION 4.04. Financial Information..................................27
SECTION 4.05. Litigation.............................................27
ARTICLE 5
COVENANTS
SECTION 5.01. Information............................................28
SECTION 5.02. Conduct of Business and Maintenance of
Existence; Merger and Sales of Assets..................29
SECTION 5.03. Use of Proceeds........................................30
SECTION 5.04. Negative Pledge........................................30
SECTION 5.05. Minimum Consolidated Tangible Net Worth................32
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default......................................32
SECTION 6.02. Notice of Default......................................34
ARTICLE 7
THE AGENT AND THE CO-SYNDICATION AGENTS
SECTION 7.01. Appointment and Authorization..........................34
SECTION 7.02. Agent and Affiliates...................................34
SECTION 7.03. Action by Agent........................................34
SECTION 7.04. Consultation with Experts..............................34
SECTION 7.05. Liability of Agent.....................................34
SECTION 7.06. Indemnification........................................35
SECTION 7.07. Credit Decision........................................35
SECTION 7.08. Successor Agent........................................35
SECTION 7.09. Agent's Fee............................................36
SECTION 7.10. Co-Syndication Agents..................................36
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair..............................................36
SECTION 8.02. Illegality.............................................37
SECTION 8.03. Increased Cost and Reduced Return......................37
SECTION 8.04. Taxes..................................................39
SECTION 8.05. Base Rate Loans Substituted for Affected
Euro-Dollar Loans......................................41
SECTION 8.06. Substitution of Bank...................................42
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ARTICLE 9
GUARANTY
SECTION 9.01. The Guaranty...........................................42
SECTION 9.02. Guaranty Unconditional.................................42
SECTION 9.03. Discharge Only upon Payment in Full;
Reinstatement in Certain Circumstances.................43
SECTION 9.04. Waiver by the Company..................................43
SECTION 9.05. Subrogation............................................43
SECTION 9.06. Stay of Acceleration...................................43
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices...............................................44
SECTION 10.02. No Waivers............................................44
SECTION 10.03. Expenses; Indemnification.............................44
SECTION 10.04. Sharing of Set-offs...................................45
SECTION 10.05. Amendments and Waivers................................45
SECTION 10.06. Successors and Assigns................................46
SECTION 10.07. Collateral............................................47
SECTION 10.08. Governing Law; Submission to Jurisdiction.............47
SECTION 10.09. Counterparts; Integration; Effectiveness..............48
SECTION 10.10. WAIVER OF JURY TRIAL..................................48
SECTION 10.11. Confidentiality.......................................48
SECTION 10.12. Termination of Existing Credit Agreements.............49
EXHIBIT A - Note
EXHIBIT B - Money Market Quote Request
EXHIBIT C - Invitation for Money Market Quotes
EXHIBIT D - Money Market Quote
EXHIBIT E - Opinion of Counsel for the Company
EXHIBIT F - Opinion of Counsel for the Borrower
EXHIBIT G - Opinion of Special Counsel for the Administrative Agent
EXHIBIT H - Assignment and Assumption Agreemen
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AGREEMENT dated as of April 12, 2000 among NORTEL NETWORKS
CORPORATION, as Guarantor, NORTEL NETWORKS INC., as Borrower, the
BANKS party hereto, ABN AMRO Bank N.V., Bank of America, N.A. and
Citibank N.A., as Co-Syndication Agents, and ▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK, as Administrative Agent.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have
the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.07(b).
"Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Company) duly completed by such Bank.
"Affiliate" means, as to any Person, (i) any other Person (a
"Controlling Person") that directly, or indirectly through one or more
intermediaries, controls such Person or (ii) any Person (other than such Person
and its Subsidiaries) which is controlled by or is under common control with a
Controlling Person. As used herein, the term "control" means possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" means ▇▇▇▇▇▇ Guaranty Trust Company of New York in its capacity
as administrative agent for the Banks hereunder, and its successors in such
capacity.
"Applicable Lending Office" means, with respect to any Bank, (i) in the
case of its Base Rate Loans, its Domestic Lending Office, (ii) in the case of
its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case of
its Money Market Loans, its Money Market Lending Office.
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"Assignee" has the meaning set forth in Section 10.06(c).
"Attributable Debt" in respect of a Financing Lease means the present
value of the obligations of the lessee thereunder for rental payments during the
remaining term of such lease.
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 10.06(c), and their respective
successors.
"Base Rate" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal
Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank as a Base
Rate Loan in accordance with the applicable Notice of Committed Borrowing or
Notice of Interest Rate Election or pursuant to Article 8.
"Borrower" means Nortel Networks Inc., a Delaware corporation, and its
successors.
"Borrowing" has the meaning set forth in Section 1.03.
"Change of Control" means (x) any person or group of persons (within
the meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as
amended), other than, prior to implementation of the Plan Arrangement, BCE, Inc.
and its Affiliates (taken as a group), shall acquire beneficial ownership
(within the meaning of Rule 13d-3 promulgated by the Securities and Exchange
Commission under said Act) of 40% or more of the outstanding shares of common
stock of the Relevant Entity, or (y) during any period of twelve consecutive
calendar months ending before or beginning after implementation of the Plan of
Arrangement, individuals who were directors of the Relevant Entity on the first
day of such period (or who were nominated for election or appointed by such
directors as a director of the Relevant Entity) shall cease to constitute a
majority of the Relevant Entity's board of directors.
For purposes of this definition, "Plan of Arrangement" means the plan
whereby BCE, Inc. shall distribute indirectly an approximately 36% ownership
interest in the Company to the shareholders of BCE, Inc. in the form of common
shares of Holdco; "Holdco" means the new publicly traded Canadian corporation
which will own all of the common shares of the Company; and "Relevant Entity"
means (i) before implementation of the Plan of Arrangement, the Company, and
(ii) after implementation of the Plan of Arrangement, each of Holdco and the
Company.
"Closing Date" means the date on or after the Effective Date on which
the Agent shall have received the documents specified in or pursuant to Section
3.01.
"Co-Syndication Agents" means ABN AMRO Bank N.V., Bank of
America, N.A. and Citibank N.A., in their capacity as co-syndication agents.
"Commitment" means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, as such amount may
be reduced from time to time pursuant to Section 2.09.
"Committed Loan" means a loan made by a Bank pursuant to Section 2.01;
provided that if any such loan or loans are combined or subdivided pursuant to a
Notice of Interest Rate Election, the term "Committed Loan" shall refer to the
combined principal amount resulting from such combination or to each of the
separate principal amounts resulting from such subdivision, as the case may be.
"Company" means Nortel Networks Corporation, a Canadian corporation,
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and its successors.
"Company's 1999 Form 10-K" means the Company's annual report on Form
10-K for 1999, as filed with the Securities and Exchange Commission pursuant to
the Securities Exchange Act of 1934.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which would be consolidated with those of the Company in
its consolidated financial statements if such statements were prepared as of
such date.
"Consolidated Net Tangible Assets" means the total amount of assets
after deducting therefrom (i) all current liabilities, and (ii) all goodwill,
tradenames, trademarks, patents, unamortized debt discount and expense and other
like intangible assets, all as shown in the most recent annual or quarterly
consolidated balance sheet of the Company (which may be contained in the
Company's then most recent annual or quarterly report on Form 10-K or Form 10-Q,
as applicable, as filed with the Securities and Exchange Commission); assets
shall include an amount equal to the Attributable Debt in respect of those
Financing Leases not capitalized on such balance sheet.
"Consolidated Tangible Net Worth" means at any date the consolidated
stockholders' equity of the Company and its Consolidated Subsidiaries less their
consolidated Intangible Assets, all determined as of such date. For purposes of
this definition, "Intangible Assets" means the amount (to the extent reflected
in determining such consolidated stockholders' equity) of goodwill, patents,
trademarks, service marks, tradenames, copyrights and other intangible assets.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"dollars" and the sign "$" means lawful money of the United States.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City are required or authorized
by law to close.
"Domestic Lending Office" means, as to each Bank, its office located at
its address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office by
notice to the Company and the Agent.
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 10.09.
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office, branch
or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Company and the Agent.
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"Euro-Dollar Loan" means a Committed Loan to be made by a Bank as a
Euro-Dollar Loan in accordance with the applicable Notice of Committed Borrowing
or Notice of Interest Rate Election.
"Euro-Dollar Reserve Percentage" has the meaning set forth in Section
2.07(b).
"Event of Default" has the meaning set forth in Section 6.01.
"Executive Officer" means any of the Chairman of the Board of
Directors, the President and Chief Executive Officer, the Chief Financial
Officer, the Treasurer, the Assistant Treasurer or the Controller of the Company
or the Borrower.
"Existing Credit Agreements" means the Credit Agreements dated as of
April 26, 1995, as amended, among the Borrower, the Company, the banks listed on
the signature pages thereof and ▇▇▇▇▇▇ Guaranty Trust Company of New York, as
Agent.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to ▇▇▇▇▇▇ Guaranty Trust Company of New
York on such day on such transactions as determined by the Agent.
"Financing Leases" means sale and leaseback transactions, except for:
(i) temporary leases for a term, including any renewal thereof, of not more than
three years; (ii) leases between the Company and the Borrower or between the
Borrower and the Company; and (iii) leases for properties executed within one
year of the latest of acquisition, completion of construction and commencement
of commercial operation thereof.
"Fixed Rate Loans" means Euro-Dollar Loans or Money Market Loans
(excluding Money Market LIBOR Loans bearing interest at the Base Rate pursuant
to Section 8.01) or both.
"Funded Debt" means any indebtedness for borrowed money, whether of the
Company or of a third person.
"Group of Loans" means at any time a group of Loans consisting of (i)
all Committed Loans which are Base Rate Loans at such time or (ii) all Committed
Loans which are Euro-Dollar Loans having the same Interest Period at such time;
provided that if a Committed Loan of any particular Bank is converted to or made
as a Base Rate Loan pursuant to Section 8.02 or 8.05, such Loan shall be
included in the same Group or Groups of Loans from time to time as it would have
been in if it had not been so converted or made.
"Indemnitee" has the meaning set forth in Section 10.03(b).
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"Interest Period" means: (1) with respect to each Euro-Dollar Loan, the
period commencing on the date of borrowing specified in the applicable Notice of
Borrowing or Notice of Interest Rate Election and ending one, two, three or six
months thereafter, as the Borrower may elect in the applicable notice; provided
that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on
the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (c) below, end on the last Euro-Dollar
Business Day of a calendar month; and
(c) any Interest Period beginning prior to the Termination Date which
would otherwise end after the Termination Date shall end on the
Termination Date, and any Interest Period beginning on or after the
Termination Date which would otherwise end after the first anniversary
of the Termination Date shall end on the first anniversary of the
Termination Date.
(2) with respect to each Money Market LIBOR Loan, the period commencing on the
date of such borrowing specified in the applicable Notice of Borrowing and
ending such whole number of months thereafter as the Borrower may elect in
accordance with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on
the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (c) below, end on the last Euro-Dollar
Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date.
(3) with respect to each Money Market Absolute Rate Loan, the period commencing
on the date of borrowing specified in the applicable Notice of Borrowing and
ending such number of days thereafter (but not less than 14 days) as the
Borrower may elect in accordance with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date.
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"LIBOR Auction" means a solicitation of Money Market Quotes setting
forth Money Market Margins based on the London Interbank Offered Rate pursuant
to Section 2.03.
"Loan" means a Base Rate Loan, a Euro-Dollar Loan or a Money Market
Loan and "Loans" means Base Rate Loans, Euro-Dollar Loans or Money Market Loans
or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in Section
2.07(b).
"Material Subsidiary" means any Subsidiary (x) the consolidated
revenues of which equal or exceed 10% of the revenues of the Company and its
Consolidated Subsidiaries on a consolidated basis or (y) the consolidated assets
of which equal or exceed 10% of the assets of the Company and its Consolidated
Subsidiaries on a consolidated basis, in each case as contained in the most
recent annual report on Form 10-K, as filed with the Securities and Exchange
Commission.
"Money Market Absolute Rate" has the meaning set forth in Section
2.03(d)(ii)(D).
"Money Market Absolute Rate Loan" means a loan to be made by a Bank
pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
Lending Office or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Money Market Lending Office by notice to the Company
and the Agent; provided that any Bank may from time to time by notice to the
Company and the Agent designate separate Money Market Lending Offices for its
Money Market LIBOR Loans, on the one hand, and its Money Market Absolute Rate
Loans, on the other hand, in which case all references herein to the Money
Market Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank pursuant to
a LIBOR Auction (including such a loan bearing interest at the Base Rate
pursuant to Section 8.01).
"Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.03(d)(ii)(C).
"Money Market Quote" means an offer by a Bank to make a Money Market
Loan in accordance with Section 2.03.
"Mortgage" means and includes any mortgage, hypothec, pledge, lien,
security interest, privilege, floating charge, conditional sale or other title
retention agreement or other similar encumbrance securing indebtedness for
borrowed money.
"Notes" means promissory notes of the Borrower, substantially in the
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
Loans made to it, and "Note" means any one of such promissory notes issued
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hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as defined
in Section 2.02) or a Notice of Money Market Borrowing (as defined in Section
2.03(f)).
"Notice of Interest Rate Election" has the meaning set forth in Section
2.10(a).
"Parent" means, with respect to any Bank, any Person controlling such
Bank.
"Participant" has the meaning set forth in Section 10.06(b).
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Prime Rate" means the rate of interest publicly announced by ▇▇▇▇▇▇
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.
"Purchase Money Mortgage" means a mortgage on property existing at the
time of acquisition thereof by the Company or the Borrower; any mortgage on any
property acquired, constructed or improved by the Company or the Borrower
incurred after the Effective Date which is created or assumed contemporaneously
with, or within 180 days after, such acquisition, or completion of such
construction or improvement, to secure or provide for the payment of the
purchase price thereof or the cost of construction or improvement thereon
incurred after the Effective Date (including the cost of any underlying real
property); provided, however, that in the case of any such acquisition,
construction or improvement, the Mortgage shall not apply to any property
previously owned by the Company or the Borrower, other than, in the case of any
such construction or improvement, any real property, theretofore substantially
unimproved for the purposes of the Company or the Borrower, on which the
property so constructed, or the improvement, is located and other than any
machinery or equipment installed at any time so as to constitute immovable
property or a fixture on the real property on which the property so constructed,
or the improvement, is located.
"Reference Banks" means the principal London offices of Citibank, N.A.,
Bank of America, N.A., and ▇▇▇▇▇▇ Guaranty Trust Company of New York, and
"Reference Bank" means any one of such Reference Banks.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having at least 51% of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing at least 51% of the aggregate unpaid
principal amount of the Loans.
"Required Banks (80%)" means at any time Banks having at least 80% of
the aggregate amount of the Commitments or, in the case of Section 7.08, if the
Commitments shall have been terminated, holding Notes evidencing at least 80% of
the aggregate unpaid principal amount of the Loans.
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"Revolving Credit Period" means the period from and including the
Closing Date to but excluding the Termination Date.
"Subsidiary" means, as to any Person, any corporation or other entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person; unless
otherwise specified, "Subsidiary" means a Subsidiary of the Company.
"Termination Date" means April 11, 2001, or, if such day is not a Euro-
Dollar Business Day, the next preceding Euro-Dollar Business Day.
"United States" means the United States of America, including the
States and the District of Columbia, but excluding its territories and
possessions.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time in the
United States, applied on a basis consistent (except for changes concurred in by
the Company's independent public accountants) with the most recent audited
consolidated financial statements of the Company and its Consolidated
Subsidiaries delivered to the Banks; provided that, if the Company notifies the
Agent that the Company wishes to amend any covenant in Article 5 to eliminate
the effect of any change in such generally accepted accounting principles on the
operation of such covenant (or if the Agent notifies the Company that the
Required Banks wish to amend Article 5 for such purpose), then the Company's
compliance with such covenant shall be determined on the basis of generally
accepted accounting principles in effect in the United States immediately before
the relevant change in generally accepted accounting principles became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Company and the Required Banks.
SECTION 1.03. Types of Borrowings. The term "Borrowing" denotes the
aggregation of Loans of one or more Banks to be made to the Borrower pursuant to
Article 2 on a single date, all of which Loans are of the same type (subject to
Article 8) and, except in the case of Base Rate Loans, have the same Interest
Period or initial Interest Period. Borrowings are classified for purposes of
this Agreement either by reference to the pricing of Loans comprising such
Borrowing (e.g., a "Fixed Rate Borrowing" is a Euro-Dollar Borrowing or a Money
Market Borrowing (excluding any such Borrowing consisting of Money Market LIBOR
Loans bearing interest at the Base Rate pursuant to Section 8.01), and a "Euro-
Dollar Borrowing" is a Borrowing comprised of Euro-Dollar Loans) or by reference
to the provisions of Article 2 under which participation therein is determined
(i.e., a "Committed Borrowing" is a Borrowing under Section 2.01 in which all
Banks participate in proportion to their Commitments, while a "Money Market
Borrowing" is a Borrowing under Section 2.03 in which the Bank participants are
determined on the basis of their bids in accordance therewith).
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend. (a) Revolving Loans. During the
Revolving Credit Period, each Bank severally agrees, on the terms and conditions
set forth in this Agreement, to make loans to the Borrower pursuant to this
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subsection (a) from time to time in amounts such that the aggregate principal
amount of Committed Loans by such Bank at any one time outstanding shall not
exceed the amount of its Commitment. Each Borrowing under this subsection (a)
shall be in an aggregate principal amount of $25,000,000 or any larger multiple
of $5,000,000 (except that any such Borrowing may be in the aggregate amount
available subject to Section 3.02(c)), and shall be made from the several Banks
ratably in proportion to their respective Commitments. Within the foregoing
limits, the Borrower may borrow under this subsection (a), repay or, to the
extent permitted by Section 2.11, prepay Loans and reborrow at any time during
the Revolving Credit Period under this subsection (a). The Commitments shall
terminate at the close of business on the Termination Date.
(b) Term Loans. Each Bank severally agrees, on the terms and
conditions set forth in this Agreement, to make a loan to the Borrower on the
Termination Date in an amount up to the aggregate principal amount of such
Bank's Loans to the Company outstanding on the Termination Date immediately
prior to giving effect to any repayment of such Loans on the Termination Date,
provided that the principal amount of such loan shall not exceed such Bank's
Commitment. Amounts prepaid pursuant to Section 2.11 shall not be reborrowed.
SECTION 2.02. Notice of Committed Borrowing. The Borrower shall give
the Agent notice (a "Notice of Committed Borrowing") not later than (x) 10:45
A.M. (New York City time) on the date of each Base Rate Borrowing and (y) 1:00
P.M. (New York City time) on the third Euro-Dollar Business Day before each
Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a Domestic Business Day
in the case of a Base Rate Borrowing or a Euro-Dollar Business Day in
the case of a Euro-Dollar Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing bear interest
initially at the Base Rate or at a Euro-Dollar Rate; and
(iv) in the case of a Euro-Dollar Borrowing, the duration of the
initial Interest Period applicable thereto, subject to the provisions
of the definition of Interest Period.
Notwithstanding the foregoing, no more than eleven Euro-Dollar Borrowings shall
be outstanding at any one time, and any Borrowing which would exceed such
limitation shall be made as a Base Rate Borrowing.
SECTION 2.03. Money Market Borrowings. (a) The Money Market Option. In
addition to Committed Borrowings pursuant to Section 2.01(a), the Borrower may,
as set forth in this Section, request the Banks during the Revolving Credit
Period to make offers to make Money Market Loans to the Borrower. The Banks may,
but shall have no obligation to, make such offers and the Borrower may, but
shall have no obligation to, accept any such offers in the manner set forth in
this Section. The making of a Money Market Loan by a Bank shall not affect its
or any other Bank's obligation to make Committed Loans pursuant to Section 2.01.
(b) Money Market Quote Request. When the Borrower wishes to request
offers to make Money Market Loans under this Section, it shall transmit to the
Agent by telex or facsimile transmission a Money Market Quote Request
substantially in the form of Exhibit B hereto so as to be received not later
13
than 10:30 A.M. (New York City time) on (x) the fourth Euro-Dollar Business Day
prior to the date of Borrowing proposed therein, in the case of a LIBOR Auction
or (y) the Domestic Business Day next preceding the date of Borrowing proposed
therein, in the case of an Absolute Rate Auction (or, in either case, such other
time or date as the Borrower and the Agent shall have mutually agreed and shall
have notified to the Banks not later than the date of the Money Market Quote
Request for the first LIBOR Auction or Absolute Rate Auction for which such
change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Euro-Dollar
Business Day in the case of a LIBOR Auction or a Domestic Business Day
in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$25,000,000 or a larger multiple of $5,000,000,
(iii) the duration of the Interest Period applicable thereto, subject
to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth a Money
Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within two Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon (and in any
event not later than 12:00 Noon (New York City time) on the date of) receipt of
a Money Market Quote Request submitted in accordance with subsection (b), the
Agent shall send to the Banks by telex or facsimile transmission an Invitation
for Money Market Quotes substantially in the form of Exhibit C hereto, which
shall constitute an invitation by the Borrower to each Bank to submit Money
Market Quotes offering to make the Money Market Loans to which such Money Market
Quote Request relates in accordance with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each Bank may
submit a Money Market Quote containing an offer or offers to make Money Market
Loans in response to any Invitation for Money Market Quotes. Each Money Market
Quote must comply with the requirements of this subsection (d) and must be
submitted to the Agent by telex or facsimile transmission at its offices
specified in or pursuant to Section 10.01 not later than (x) 10:00 A.M. (New
York City time) on the third Euro-Dollar Business Day prior to the proposed date
of Borrowing, in the case of a LIBOR Auction or (y) 9:30 A.M. (New York City
time) on the proposed date of Borrowing, in the case of an Absolute Rate Auction
(or, in either case, such other time or date as the Borrower and the Agent shall
have mutually agreed and shall have notified to the Banks not later than the
date of the Money Market Quote Request for the first LIBOR Auction or Absolute
Rate Auction for which such change is to be effective); provided that Money
Market Quotes submitted by the Agent (or any affiliate of the Agent) in the
capacity of a Bank may be submitted, and may only be submitted, if the Agent or
such affiliate notifies the Borrower of the terms of the offer or offers
contained therein not later than (x) one hour prior to the deadline for the
other Banks, in the case of a LIBOR Auction or (y) 15 minutes prior to the
deadline for the other Banks, in the case of an Absolute Rate Auction. Subject
to Articles 3 and 6, any Money Market Quote so made shall be irrevocable except
14
with the written consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for
which each such offer is being made, which principal amount
(w) may be greater than or less than the Commitment of the
quoting Bank, (x) must be $5,000,000 or a larger multiple of
$1,000,000, (y) may not exceed the principal amount of Money
Market Loans for which offers were requested and (z) may be
subject to an aggregate limitation as to the principal amount
of Money Market Loans for which offers being made by such
quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or
below the applicable London Interbank Offered Rate (the "Money
Market Margin") offered for each such Money Market Loan,
expressed as a percentage (specified to the nearest 1/10,000th
of 1%) to be added to or subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of
interest per annum (specified to the nearest 1/10,000th of 1%)
(the "Money Market Absolute Rate") offered for each such Money
Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D
hereto or does not specify all of the information required by
subsection (d)(ii);
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set
forth in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection
(d)(i).
(e) Notice to Borrower. The Agent shall promptly (x) and in any event
not later than 10:45 A.M. (New York City time), in the case of a LIBOR Auction,
or 10:00 A.M. (New York City time), in the case of an Absolute Rate Auction, on
the date of receipt notify the Borrower of the terms of any Money Market Quote
submitted by a Bank that is in accordance with subsection (d) and (y) notify the
Borrower of the terms of any Money Market Quote that amends, modifies or is
otherwise inconsistent with a previous Money Market Quote submitted by such Bank
with respect to the same Money Market Quote Request. Any such subsequent Money
15
Market Quote shall be disregarded by the Agent unless such subsequent Money
Market Quote is submitted solely to correct a manifest error in such former
Money Market Quote. The Agent's notice to the Borrower shall specify (A) the
aggregate principal amount of Money Market Loans for which offers have been
received for each Interest Period specified in the related Money Market Quote
Request, (B) the respective principal amounts and Money Market Margins or Money
Market Absolute Rates, as the case may be, so offered and (C) if applicable,
limitations on the aggregate principal amount of Money Market Loans for which
offers in any single Money Market Quote may be accepted.
(f) Acceptance and Notice by Borrower. Not later than (x) 11:30 A.M.
(New York City time) on the third Euro-Dollar Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or (y) 10:45 A.M. (New York
City time) on the proposed date of Borrowing, in the case of an Absolute Rate
Auction (or, in either case, such other time or date as the Borrower and the
Agent shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective), the Borrower
shall notify the Agent of its acceptance or non-acceptance of the offers so
notified to it pursuant to subsection (e). In the case of acceptance, such
notice (a "Notice of Money Market Borrowing") shall specify the aggregate
principal amount of offers for each Interest Period that are accepted. The
Borrower may accept any Money Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market Borrowing may
not exceed the applicable amount set forth in the related Money Market
Quote Request;
(ii) the principal amount of each Money Market Borrowing must
be $25,000,000 or a larger multiple of $5,000,000;
(iii) acceptance of offers may only be made on the basis of ascending
Money Market Margins or Money Market Absolute Rates, as the case may
be; and
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Agent. If offers are made by two or more Banks with
the same Money Market Margins or Money Market Absolute Rates, as the case may
be, for a greater aggregate principal amount than the amount in respect of which
such offers are accepted for the related Interest Period, the principal amount
of Money Market Loans in respect of which such offers are accepted shall be
allocated by the Agent among such Banks as nearly as possible (in multiples of
$1,000,000, as the Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans. (a) Promptly upon (and
in any event not later than (w) 12:00 Noon (New York City time), in the case of
a LIBOR Auction, (x) 11:15 A.M. (New York City time), in the case of an Absolute
Rate Auction, (y) 11:30 A.M. (New York City time), in the case of a Base Rate
Borrowing, and (z) 2:30 P.M. (New York City time), in the case of a Euro-Dollar
Borrowing, in each case on the date of) receipt of a Notice of Borrowing
submitted in accordance with the terms of this Agreement, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's share (if
16
any) of such Borrowing and (except as provided in Section 8.01) such Notice of
Borrowing shall not thereafter be revocable by the Borrower.
(b) Not later than 12:30 P.M. (New York City time) on the date of each
Borrowing, each Bank participating therein shall (except as provided in
subsection (c) of this Section) make available its share of such Borrowing, in
Federal or other funds immediately available in New York City, to the Agent at
its address referred to in Section 10.01. Unless the Agent determines that any
applicable condition specified in Article 3 has not been satisfied, the Agent
will make the funds so received not later than 12:30 P.M. (New York City time)
from the Banks available to the Borrower at the Agent's aforesaid address not
later than 1:30 P.M. (New York City time) on the day of receipt.
(c) If any Bank makes a new Loan hereunder to the Borrower on a day on
which the Borrower is to repay all or any part of an outstanding Loan from such
Bank, such Bank shall apply the proceeds of its new Loan to make such repayment
and only an amount equal to the difference (if any) between the amount being
borrowed by the Borrower and the amount being repaid shall be made available by
such Bank to the Agent as provided in subsection (b) of this Section, or
remitted by the Borrower to the Agent as provided in Section 2.12, as the case
may be.
(d) Unless the Agent shall have received notice from a Bank prior to
the date of any Borrowing (or, in the case of a Base Rate Borrowing, prior to
12:00 Noon (New York City time) on the date of such Borrowing) that such Bank
will not make available to the Agent such Bank's share of such Borrowing, the
Agent may assume that such Bank has made such share available to the Agent on
the date of such Borrowing in accordance with subsections (b) and (c) of this
Section and the Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such
Bank shall not have so made such share available to the Agent, such Bank and the
Borrower severally agree to repay to the Agent promptly on demand (and in any
event within three Euro-Dollar Business Days) 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 Agent, at (i) in the
case of the Borrower, a rate per annum equal to the interest rate applicable
thereto pursuant to Section 2.07 and (ii) in the case of such Bank, the Federal
Funds Rate. If such Bank shall repay to the Agent such corresponding amount,
such amount so repaid shall constitute such Bank's Loan included in such
Borrowing for purposes of this Agreement.
SECTION 2.05. Notes. (a) The Loans of each Bank to the Borrower shall
be evidenced by a single Note of the Borrower payable to the order of such Bank
for the account of its Applicable Lending Office in an amount equal to the
aggregate unpaid principal amount of such Bank's Loans to the Borrower.
(b) Each Bank may, by notice to the Borrower and the Agent, request
that its Loans of a particular type to the Borrower be evidenced by a separate
Note of the Borrower in an amount equal to the aggregate unpaid principal amount
of such Loans. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely Loans of the relevant type. Each reference in this Agreement to the
"Note" of such Bank shall be deemed to refer to and include any or all of such
Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.01(a), the
Agent shall forward such Note to such Bank. Each Bank shall record the date,
17
amount, type and maturity of each Loan made by it to the Borrower and the date
and amount of each payment of principal made with respect thereto, and may, if
such Bank so elects in connection with any transfer or enforcement of its Note,
endorse on the schedule forming a part thereof appropriate notations to evidence
the foregoing information with respect to each such Loan to the Borrower then
outstanding; provided that the failure of any Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower hereunder or
under the Notes. Each Bank is hereby irrevocably authorized by the Borrower so
to endorse its Note and to attach to and make a part of its Note a continuation
of any such schedule as and when required.
SECTION 2.06. Maturity of Loans. Each Loan included in any Borrowing
made pursuant to Section 2.01(a) shall mature, and the principal amount thereof
shall be due and payable, together with accrued interest thereon, on the
Termination Date. Each Loan included in any Borrowing made pursuant to Section
2.01(b) shall mature, and the principal amount thereof shall be due and payable,
together with accrued interest thereon, on the first anniversary of the
Termination Date. Each Loan included in any Borrowing made pursuant to Section
2.03 shall mature, and the principal amount thereof shall be due and payable, on
the last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due, at a rate per annum equal to the Base
Rate for such day. Such interest shall be payable quarterly in arrears on the
last day of each quarter and, with respect to the principal amount of any Base
Rate Loan converted to a Euro-Dollar Loan, on the date of such conversion. Any
overdue principal of or interest on any Base Rate Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of 2% plus the rate otherwise applicable to Base Rate Loans for such day.
(b) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for such
day plus the Adjusted London Interbank Offered Rate applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than three months, at intervals
of three months after the first day thereof.
The "Euro-Dollar Margin" for any day is (x) for each Euro-Dollar Loan
included in any Borrowing made pursuant to Section 2.01(a), the sum of 0.1375%
plus, if Utilization exceeds 25% on such day, 0.05%, and (y) for each
Euro-Dollar Loan included in any Borrowing made pursuant to Section 2.01(b),
0.3125%.
"Utilization" means, on any day, the percentage equivalent of a
fraction, (i) the numerator of which is the aggregate outstanding principal
amount of the Loans on such day, after giving effect to any borrowing or payment
on such day, and (ii) the denominator of which is the aggregate amount of the
Commitments on such day, after giving effect to any reduction of the Commitments
on such day.
The "Adjusted London Interbank Offered Rate" applicable to any Interest
Period means a rate per annum equal to the quotient obtained (rounded upward, if
necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable London
Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve Percentage.
18
The "London Interbank Offered Rate" applicable to any Interest Period
means the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Agent from time to
time for purposes of providing quotations of interest rates applicable to dollar
deposits in the London interbank market) at approximately 11:00 A.M. (London
time) two Euro-Dollar Business Days prior to commencement of such Interest
Period, as the rate for dollar deposits with a maturity comparable to such
Interest Period. In the event that such rate is not available at such time for
any reason, the "London Interbank Offered Rate" applicable to such Interest
Period shall be the average (rounded upward, if necessary, to the next higher
1/16 of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Reference Banks by leading banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal to
the principal amount of the Loan of such Reference Bank to which such Interest
Period is to apply and for a period of time comparable to such Interest Period.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the Euro-Dollar
Reserve Percentage.
(c) Any overdue principal of or interest on any Euro-Dollar Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the Euro-Dollar Margin for such day plus the higher
of (i) the Adjusted London Interbank Offered Rate applicable to the Interest
Period for such Loan and (ii) the quotient obtained (rounded upward, if
necessary, to the next higher 1/100 of 1%) by dividing (x) the average (rounded
upward, if necessary, to the next higher 1/16 of 1%) of the respective rates per
annum at which one day (or, if such amount due remains unpaid more than three
Euro-Dollar Business Days, then for such other period of time not longer than
three months as the Agent may select) deposits in dollars in an amount
approximately equal to such overdue payment due to each of the Reference Banks
are offered to such Reference Bank by leading banks in the London interbank
market for the applicable period determined as provided above by (y) 1.00 minus
the Euro-Dollar Reserve Percentage (or, if the circumstances described in clause
(a) or (b) of Section 8.01 shall exist, at a rate per annum equal to the sum of
2% plus the rate applicable to Base Rate Loans for such day).
(d) Subject to Section 8.01, each Money Market LIBOR Loan shall bear
interest on the outstanding principal amount thereof, for the Interest Period
applicable thereto, at a rate per annum equal to the sum of the London Interbank
Offered Rate for such Interest Period (determined in accordance with Section
2.07(b) as if the related Money Market LIBOR Borrowing were a Committed
Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted by the
Bank making such Loan in accordance with Section 2.03. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
19
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.03. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
(e) The Agent shall determine each interest rate applicable to the
Loans hereunder. The Agent shall give prompt notice to the Borrower and the
participating Banks of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(f) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Agent as contemplated by this Section. If any Reference Bank
does not furnish a timely quotation, the Agent shall determine the relevant
interest rate on the basis of the quotation or quotations furnished by the
remaining Reference Bank or Banks or, if none of such quotations is available on
a timely basis, the provisions of Section 8.01 shall apply.
SECTION 2.08. Fees. (a) The Borrower shall pay to the Agent for the
account of the Banks ratably a facility fee at the rate per annum of 0.05%. Such
facility fee shall accrue (i) from and including the Closing Date to but
excluding the date of termination of the Commitments in their entirety, on the
daily aggregate amount of the Commitments (whether used or unused) and (ii) from
and including such date of termination to but excluding the date the Loans shall
be repaid in their entirety, on the daily aggregate outstanding principal amount
of the Loans.
(b) Accrued fees under this Section shall be payable quarterly in
arrears on each March 31, June 30, September 30, December 31 and on the date of
termination of the Commitment of any Bank in its entirety (and, if later, the
date the Loans of such Bank shall be repaid in their entirety).
SECTION 2.09. Optional Termination or Reduction of Commitments. During
the Revolving Credit Period, the Borrower may, upon at least three Domestic
Business Days' notice to the Agent, (i) terminate the Commitments at any time,
if no Loans are outstanding at such time or (ii) ratably reduce from time to
time by an aggregate amount of $25,000,000 or a larger multiple of $5,000,000,
the aggregate amount of the Commitments in excess of the aggregate outstanding
principal amount of the Loans.
SECTION 2.10. Method of Electing Interest Rates. (a) The Loans included
in each Committed Borrowing shall bear interest initially at the type of rate
specified by the Borrower in the applicable Notice of Committed Borrowing.
Thereafter, the Borrower may from time to time elect to change or continue the
type of interest rate borne by each Group of Loans (subject in each case to the
provisions of Article 8) , as follows: (i) if such Loans are Base Rate Loans,
the Borrower may elect to convert such Loans to Euro-Dollar Loans as of any
Euro- Dollar Business Day, or (ii) if such Loans are Euro-Dollar Loans, the
Company may elect to convert such Loans to Base Rate Loans or elect to continue
such Loans as Euro-Dollar Loans for an additional Interest Period, in each case
effective on the last day of the then current Interest Period applicable to such
Loans. Each such election shall be made by delivering a notice (a "Notice of
Interest Rate Election") to the Agent at least three Euro-Dollar Business Days
before the conversion or continuation selected in such notice is to be
20
effective. A Notice of Interest Rate Election may, if it so specifies, apply to
only a portion of the aggregate principal amount of the relevant Group of Loans;
provided that (i) such portion is allocated ratably among the Loans comprising
such Group and (ii) the portion to which such Notice applies, and the remaining
portion to which it does not apply, are each $25,000,000 or any larger multiple
of $5,000,000.
(b) Each Notice of Interest Rate Election shall specify: (i) the Group
of Loans (or portion thereof) to which such notice applies; (ii) the date on
which the conversion or continuation selected in such notice is to be effective,
which shall comply with the applicable clause of subsection (a) above; (iii) if
the Loans comprising such Group are to be converted, the new type of Loans and,
if such new Loans are Euro-Dollar Loans, the duration of the initial Interest
Period applicable thereto; and (iv) if such Loans are to be continued as
Euro-Dollar Loans for an additional Interest Period, the duration of such
additional Interest Period. Each Interest Period specified in a Notice of
Interest Rate Election shall comply with the provisions of the definition of
Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the
Borrower pursuant to subsection (a) above, the Agent shall promptly notify each
Bank of the contents thereof and such notice shall not thereafter be revocable
by the Borrower. If the Borrower fails to deliver a timely Notice of Interest
Rate Election to the Agent for any Group of Euro-Dollar Loans, such Loans shall
be converted into Base Rate Loans on the last day of the then current Interest
Period applicable thereto.
SECTION 2.11. Optional Prepayments. (a) Subject in the case of any
Euro-Dollar Borrowing to Section 2.13, the Borrower may, upon at least one
Domestic Business Day's notice to the Agent, prepay the Group of Base Rate Loans
(or any Money Market Borrowing bearing interest at the Base Rate, pursuant to
Section 8.01) or upon at least three Euro-Dollar Business Days' notice to the
Agent, prepay any Group of Euro-Dollar Loans, in each case in whole at any time,
or from time to time in part in amounts aggregating $5,000,000 or any larger
multiple of $5,000,000, by paying the principal amount to be prepaid together
with accrued interest thereon to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Loans of the several Banks
included in such Borrowing.
(b) Except as provided in subsection (a) above or Section 8.02, the
Borrower may not prepay all or any portion of the principal amount of any Money
Market Loan prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this Section,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share (if any) of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.12. General Provisions as to Payments. (a) The Borrower shall
make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 12:00 Noon (New York City time) on the date when due,
in Federal or other funds immediately available in New York City, to the Agent
at its address referred to in Section 10.01. The Agent will promptly distribute
to each Bank its ratable share of each such payment received by the Agent for
the account of the Banks. Whenever any payment of principal of, or interest on,
the Base Rate Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
21
succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. Whenever any payment of
principal of, or interest on, the Money Market Loans shall be due on a day which
is not a Euro-Dollar Business Day, the date for payment thereof shall be
extended to the next succeeding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due from the Borrower to the Banks
hereunder that the Borrower will not make such payment in full, the Agent may
assume that the Borrower has made such payment in full to the Agent on such date
and the Agent may, in reliance upon such assumption, cause to be distributed to
each Bank on such due date an amount equal to the amount then due such Bank. If
and to the extent that the Borrower shall not have so made such payment, each
Bank shall repay to the Agent forthwith on demand such amount distributed to
such Bank together with interest thereon, for each day from the date such amount
is distributed to such Bank until the date such Bank repays such amount to the
Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If the Borrower makes any payment of
principal with respect to any Fixed Rate Loan (pursuant to Article 2, 6 or 8
(other than Section 8.02) or otherwise) on any day other than the last day of
the Interest Period applicable thereto, or the last day of an applicable period
fixed pursuant to Section 2.07(c), or if the Borrower fails to borrow or prepay
any Fixed Rate Loans after notice has been given to any Bank in accordance with
Section 2.04(a) or 2.11(a) (except as a result of (x) a default by the Agent or
any Bank in observing the terms of this Agreement or (y) an election not to
borrow pursuant to Section 8.01), the Borrower shall reimburse each Bank within
15 days after demand for any resulting loss or expense directly incurred by it,
including (without limitation) any loss incurred in obtaining, liquidating or
employing deposits from third parties, but excluding consequential damages and
loss of margin for the period after any such payment or failure to borrow or
prepay, provided that such Bank (x) shall have delivered to the Borrower a
certificate as to the amount of such loss or expense, and (y) shall use all
reasonable efforts to mitigate the amount payable by the Borrower under this
Section 2.13.
SECTION 2.14. Computation of Interest and Fees. Interest based on the
Prime Rate hereunder shall be computed on the basis of a year of 365 days (or
366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. Judgment Currency. If for the purpose of obtaining
judgment in any court it is necessary to convert a sum due from the Borrower or
the Company hereunder or under any of the Notes in dollars into another
currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Agent could purchase dollars with
such other currency at the Agent's New York office on the Domestic Business Day
22
preceding that on which final judgment is given. The obligations of the Borrower
or the Company, as the case may be, in respect of any sum due to any Bank or the
Agent hereunder or under any Note shall, notwithstanding any judgment in a
currency other than dollars, be discharged only to the extent that on the
Domestic Business Day following receipt by such Bank or the Agent (as the case
may be) of any sum adjudged to be so due in such other currency such Bank or the
Agent (as the case may be) may in accordance with normal banking procedures
purchase dollars with such other currency; if the amount of dollars so purchased
is less than the sum originally due to such Bank or the Agent, as the case may
be, in dollars, each of the Borrower and the Company agrees, to the fullest
extent that it may effectively do so, as a separate obligation and
notwithstanding any such judgment, to indemnify such Bank or the Agent, as the
case may be, against such loss, and if the amount of dollars so purchased
exceeds (a) the sum originally due to any Bank or the Agent, as the case may be,
and (b) any amounts shared with other Banks as a result of allocations of such
excess as a disproportionate payment to such Bank under Section 10.04, such Bank
or the Agent, as the case may be, agrees to remit such excess to the Borrower or
the Company, as applicable.
ARTICLE 3
CONDITIONS
SECTION 3.01. Closing. The closing hereunder shall occur upon receipt
by the Agent of the following documents, each dated the Closing Date unless
otherwise indicated:
(a) a duly executed Note of the Borrower for the account of each Bank
dated on or before the Closing Date complying with the provisions of Section
2.05;
(b) an opinion of ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chief Legal Officer of the
Company, substantially in the form of Exhibit E hereto, and an opinion of ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, Vice President, Law, Mergers & Acquisitions of the Borrower,
substantially in the form of Exhibit F hereto;
(c) an opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the
Agent, substantially in the form of Exhibit G hereto;
(d) a certificate, signed by the Chief Financial Officer or the
Controller of the Company, in form and substance satisfactory to the Agent
stating that since December 31, 1999 there has been no material adverse change
in the business, financial position, results of operations or prospects of the
Company and its Consolidated Subsidiaries, considered as a whole; and
(e) all documents the Agent may reasonably request relating to the
existence of the Company and the Borrower, the corporate authority for and the
validity of this Agreement and the Notes, and any other matters relevant hereto,
all in form and substance satisfactory to the Agent.
The Agent shall promptly notify the Company, the Borrower and the Banks of the
Closing Date, and such notice shall be conclusive and binding on all parties
hereto.
SECTION 3.02. Borrowings. The obligation of any Bank to make a Loan
on the occasion of any Borrowing is subject to the satisfaction of the following
23
conditions:
(a) the fact that the Closing Date shall have occurred on or prior to
April 12, 2000;
(b) receipt by the Agent of a Notice of Borrowing as required by
Section 2.02 or 2.03, as the case may be;
(c) the fact that, immediately after such Borrowing, the aggregate
outstanding principal amount of the Committed Loans will not exceed the
aggregate amount of the Commitments;
(d) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing;
(e) the fact that the representations and warranties of the Company
and the Borrower contained in this Agreement shall be true on and as of the date
of such Borrowing; and
(f) in the case of any Borrowing which would violate any limitation
imposed by the board of directors of the Company or the Borrower in effect on
the date hereof on the principal amount of any financing or the outstanding
principal amount of any financings of the Company or the Borrower, as the case
may be, receipt by the Agent of a copy, certified by an appropriate officer of
the Company or the Borrower, as the case may be, of the resolutions of the board
of directors of such Person pursuant to which such Borrowing is authorized.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the facts specified in clauses
(c), (d) and (e) of this Section.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Each of the Company and the Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. Each of the Company and
the Borrower is a corporation duly incorporated and validly existing (and, in
the case of the Borrower, in good standing) under the laws of the jurisdiction
of its incorporation, and has all corporate powers and all governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted, the absence of which would have a material adverse
effect on the ability of the Company and the Borrower, taken together, to
perform their obligations under this Agreement.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by each of the Company
and the Borrower of this Agreement and by the Borrower of its Notes (i) are
within such Person's corporate powers and have been duly authorized by all
necessary corporate action, (ii) require no action by or in respect of, or
filing with, any governmental body, agency or official and (iii) do not
contravene any provision of applicable law or regulation or any provision of the
certificate of incorporation or by-laws of such Person or any contractual
restriction, order, decree or other instrument binding upon such Person or any
of its Subsidiaries, except, in the case of clauses (ii) and (iii) above, any
such action, filing or contravention which would not have a material adverse
effect on the ability of the Company and the Borrower, taken together, to
24
perform their obligations under this Agreement.
SECTION 4.03. Binding Effect. This Agreement constitutes a valid and
binding agreement of each of the Company and the Borrower and each Note, when
executed and delivered in accordance with this Agreement, will constitute a
valid and binding obligation of the Borrower, in each case enforceable in
accordance with its terms, except as the same may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally, by general
principles of equity (it being understood that the enforceability thereof in
Canada may be limited by the Currency Act (Canada), which precludes Canadian
courts from awarding a judgment for an amount expressed in a currency other than
Canadian dollars, and to the extent that any requirement to pay interest at a
greater rate after than before default may not be enforceable in Canada if the
same is construed by a Canadian court to constitute a penalty).
SECTION 4.04. Financial Information. The consolidated balance sheet of
the Company and its Consolidated Subsidiaries as of December 31, 1999 and the
related consolidated statements of operations, cash flows and retained earnings
for the fiscal year then ended, reported on by Deloitte & Touche LLP and set
forth in the Company's 1999 Form 10-K, fairly present, in conformity with
Canadian generally accepted accounting principles, the consolidated financial
position of the Company and its Consolidated Subsidiaries as of such date and
their consolidated results of operations and cash flows for such fiscal year.
SECTION 4.05. Litigation. There is no action, suit or proceeding
pending against, or to the knowledge of the Company threatened against or
affecting, the Company or any of its Subsidiaries before any court or arbitrator
or any governmental body, agency or official in which there is a reasonable
possibility of an adverse decision which could have a material adverse effect on
the ability of the Company or the Borrower, taken together, to perform their
obligations under this Agreement, or which in any manner draws into question the
validity of this Agreement or the Notes.
ARTICLE 5
COVENANTS
The Company agrees that, so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Company will deliver to each of the
Banks:
(a) as soon as available and in any event within 120 days after the
end of each fiscal year of the Company, the Company's annual report on Form 10-K
as filed with the Securities and Exchange Commission, including a consolidated
balance sheet of the Company and its Consolidated Subsidiaries as of the end of
such fiscal year and the related consolidated statements of operations, cash
flows and retained earnings for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all reported on in a
manner acceptable to the Securities and Exchange Commission by Deloitte & Touche
LLP or other independent public accountants of nationally recognized standing;
(b) as soon as available and in any event within 60 days after the end
of each of the first three quarters of each fiscal year of the Company, the
Company's quarterly report on Form 10-Q as filed with the Securities and
Exchange Commission, including a consolidated balance sheet of the Company and
its Consolidated Subsidiaries as of the end of such quarter and the related
25
consolidated statements of operations, cash flows and retained earnings for such
quarter and for the portion of the Company's fiscal year ended at the end of
such quarter, setting forth in the case of such statements of operations, cash
flows and retained earnings, in comparative form the figures for the
corresponding quarter and the corresponding portion of the Company's previous
fiscal year;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a copy of a certificate of
the Treasurer of the Company (with the original of such certificate delivered to
the Agent) stating whether to the best of such Person's knowledge, after having
conducted a reasonable investigation, any Default exists on the date of such
certificate and, if any Default then exists, setting forth reasonable details
thereof;
(d) within five days after any Executive Officer of the Company or the
Borrower obtains knowledge of any Default, if such Default is then continuing,
notice of such Default;
(e) promptly after the mailing thereof to the shareholders of the
Company generally, copies of all other reports and proxy statements so mailed;
(f) promptly after the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and reports on Form 8-K (or its equivalent) which
the Company shall have filed with the Securities and Exchange Commission; and
(g) from time to time such additional information regarding the
financial position or business of the Company and its Subsidiaries as any Bank
may reasonably request through the Agent as being desirable to enable such Bank
to protect its rights under this Agreement; provided that neither the Company
nor the Borrower shall be under any obligation to supply any information the
supply of which would be contrary to any confidentiality obligation binding on
the Company or the Borrower or any of their respective Subsidiaries or which, in
the Company's opinion, is unpublished price sensitive information or the supply
of which would, in the Company's opinion, be contrary to any applicable
securities laws or the regulations of any relevant stock exchange.
SECTION 5.02. Conduct of Business and Maintenance of Existence; Merger
and Sales of Assets. (a) The Company will continue, and will cause each Material
Subsidiary to continue, to engage in business of the same general type as now
conducted by the Company and its Material Subsidiaries, and will preserve, renew
and keep in full force and effect, and will cause each Material Subsidiary to
preserve, renew and keep in full force and effect, their respective corporate
existence and their respective rights, privileges and franchises necessary or
desirable in the normal conduct of business; provided that nothing in this
subsection (a) shall prohibit (i) the amalgamation, merger or consolidation of a
Material Subsidiary with or into the Borrower or the amalgamation, merger or
consolidation of a Material Subsidiary with or into another Person if the
corporation surviving such amalgamation, merger or consolidation is a Material
Subsidiary and if, in each case, after giving effect thereto, no Default shall
have occurred and be continuing or (ii) the termination of the corporate
existence of any Material Subsidiary, or any change in, or termination of, the
business of any Material Subsidiary, or any disposition of the Company's
interest in any Material Subsidiary in whole or in part (including by way of
amalgamation, merger or consolidation), if the Company in good faith determines
that such termination, change or disposition is in the best interest of the
26
Company and would not materially and adversely affect the ability of the Company
and the Borrower, taken together, to perform their obligations under this
Agreement.
(b) The Company will not (i) amalgamate, consolidate or merge with or
into any other Person or (ii) sell, lease or otherwise transfer, directly or
indirectly, all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole, to any other Person, unless:
(x) the corporation formed by such amalgamation or
consolidation or into which the Company is merged (in each case, if
other than the Company) or the Person that acquires substantially all
of the assets of the Company is a corporation organized under the laws
of Canada or the United States that expressly assumes, by an
unconditional written instrument executed and delivered to the Agent
and the Banks, the due and punctual performance of all of the Company's
obligations hereunder; and
(y) after giving effect to such amalgamation, consolidation,
merger, sale, lease or other transfer and to the assumption referred to
in clause (x) above, if applicable, no Default has occurred and is
continuing.
SECTION 5.03. Use of Proceeds. The proceeds of the Loans made under
this Agreement will be used by the Borrower for general corporate purposes. None
of such proceeds will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any "margin stock"
within the meaning of Regulation U.
SECTION 5.04. Negative Pledge. (a) Subject to the following exceptions,
the Company will not, and will not permit the Borrower, to issue, assume or
guarantee any Funded Debt secured by, and will not secure any Funded Debt by, a
Mortgage upon any property of the Company or the Borrower (whether now owned or
hereafter acquired) without in any such case effectively providing concurrently
therewith that the Loans shall be secured equally and ratably with such Funded
Debt; provided, however, that the foregoing restrictions shall not apply to
Funded Debt secured by:
(i) Purchase Money Mortgages;
(ii) Mortgages on property of a corporation existing at the time such
corporation is liquidated or merged into, or amalgamated or
consolidated with, the Company or the Borrower or at the time of a
sale, lease or other disposition to the Company or the Borrower of the
properties of a corporation as, or substantially as, an entirety;
(iii) Mortgages to secure indebtedness of the Borrower to the
Company or to secure indebtedness of the Company to the Borrower;
(iv) Mortgages in favor of the United States, Canada or any Province
thereof, or any department, agency or instrumentality or political
subdivision thereof, or in favor of any other country or political
subdivision, to secure partial, progress, advance or other payments
pursuant to any contract or statute or to secure any indebtedness
incurred or guaranteed for the purpose of financing or refinancing all
or any part of the purchase price of the property, shares of capital
stock or indebtedness subject to such Mortgages, or the cost of
27
constructing or improving the property subject to such Mortgages
(including, without limitation, Mortgages incurred in connection with
pollution control, industrial revenue or similar financings); and
(v) any extension, renewal or replacement (or successive extensions,
renewals or replacements) in whole or in part of any Mortgage existing
at the Effective Date or any Mortgage referred to in the foregoing
clauses (i) through (iv), inclusive, provided, however, that the
principal amount of the Funded Debt secured thereby shall not exceed
the principal amount of the Funded Debt so secured at the time of such
extension, renewal or replacement, and that such extension, renewal or
replacement shall be limited to all or part of the property (plus
improvements and construction on such property) or indebtedness that
was subject to the Mortgage so extended, renewed or replaced.
(b) Notwithstanding the foregoing, the Company or the Borrower may
issue, assume or guarantee Funded Debt secured by a Mortgage upon any property
of the Company or the Borrower that would otherwise be subject to the foregoing
restrictions, and may carry out any other transactions which would otherwise be
subject to the foregoing restrictions, provided the aggregate amount of all (1)
such Funded Debt and (2) Attributable Debt in respect of all Financing Leases
entered into on or after the Effective Date would not, after giving effect
thereto, exceed 15% of the Company's Consolidated Net Tangible Assets.
(c) The Company will not, and will not permit the Borrower to, enter
into any Financing Leases covering any property of the Borrower or the Company
unless: (1) immediately thereafter the sum of (i) the Attributable Debt in
respect of all Financing Leases entered into on or after the Effective Date and
(ii) the aggregate amount of all Funded Debt secured by a Mortgage (exclusive of
any secured Funded Debt permitted by clauses (i) through (v) of subsection (a)
of this Section 5.04) does not exceed 15% of the Company's Consolidated Net
Tangible Assets; (2) the Company or the Borrower would (at the time of entering
into such arrangement) be entitled, pursuant to clauses (i) to (v) of subsection
(a) of this Section 5.04, without equally and ratably securing the Loans, to
issue, assume or guarantee indebtedness secured by a Mortgage on such property;
or (3) the Company or the Borrower shall apply, within 360 days of the effective
date of any such arrangement, an amount equal to the Attributable Debt in
respect of such Financing Leases to the prepayment or retirement of indebtedness
incurred or assumed by the Company or the Borrower (other than indebtedness
owned by the Company or the Borrower) which by its terms matures at or is
extendible or renewable at the option of the obligor to a date more than 12
months after the date of the creation of such indebtedness.
SECTION 5.05. Minimum Consolidated Tangible Net Worth. Consolidated
Tangible Net Worth will at no time be less than $1,888,000,000.
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any Loan
or shall fail to pay any interest, any fees or any other amount payable
hereunder within five days of the due date thereof;
(b) the Company shall fail to observe or perform any covenant
28
contained in Sections 5.02(b), 5.04 or 5.05;
(c) the Borrower or the Company shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than those covered by
clause (a) or (b) above) and does not remedy the failure on or before thirty
days after notice thereof has been given to the Borrower and the Company by the
Agent at the request of any Bank;
(d) any representation or warranty made (or, pursuant to Section 3.02,
deemed made) by the Borrower or the Company in this Agreement or in any
certificate delivered pursuant to this Agreement shall prove to have been
incorrect in any material respect when made (or deemed made);
(e) an event of default as defined in any evidence of indebtedness for
borrowed money of the Company exceeding on its face $100,000,000 in principal
amount (whether such indebtedness now exists or shall hereafter be created)
shall have occurred, which results in such indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise become
due and payable and such acceleration shall not be rescinded or annulled within
10 days of written notice of such acceleration; or
(f) the Company or any Material Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;
(g) an involuntary case or other proceeding shall be commenced against
the Company or any Material Subsidiary seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Company or any Material Subsidiary under the
bankruptcy or insolvency laws as now or hereafter in effect in Canada or the
United States;
(h) judgments or orders for the payment of money in excess of
$300,000,000 shall be rendered against the Company or any Subsidiary and such
judgments or orders shall continue unsatisfied and unstayed for a period of 30
days, if, after such 30-day period, such continuation has a material adverse
impact on the ability of the Company and the Borrower, taken together, to
perform their obligations under this Agreement; or
(i) a Change of Control shall occur;
then, and in every such event, the Agent shall (i) if requested by Banks having
more than 50% in aggregate amount of the Commitments, by notice to the Borrower
terminate the Commitments and they shall thereupon terminate, and (ii) if
requested by Banks holding more than 50% of the aggregate principal amount of
29
the Loans, by notice to the Borrower declare the Loans (together with accrued
interest thereon) to be, and the Loans shall thereupon become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; provided that in the case of any
of the Events of Default specified in clause 6.01(f) or 6.01(g) above with
respect to the Company or the Borrower, without any notice to the Company or the
Borrower or any other act by the Agent or the Banks, the Commitments shall
thereupon terminate and the Loans (together with accrued interest thereon) shall
become immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.
SECTION 6.02. Notice of Default. The Agent shall give notice to the
Borrower and the Company under Section 6.01(c) promptly upon being requested to
do so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE 7
THE AGENT AND THE CO-SYNDICATION AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank irrevocably
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Agreement and the Notes as are delegated to
the Agent by the terms hereof or thereof, together with all such powers as are
reasonably incidental thereto.
SECTION 7.02. Agent and Affiliates. ▇▇▇▇▇▇ Guaranty Trust Company of
New York shall have the same rights and powers under this Agreement as any other
Bank and may exercise or refrain from exercising the same as though it were not
the Agent, and ▇▇▇▇▇▇ Guaranty Trust Company of New York and its affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with the Company or any Subsidiary or Affiliate of the Company as if it
were not the Agent.
SECTION 7.03. Action by Agent. The obligations of the Agent hereunder
are only those expressly set forth herein. Without limiting the generality of
the foregoing, the Agent shall not be required to take any action with respect
to any Default, except as expressly provided in Article 6.
SECTION 7.04. Consultation with Experts. The Agent may consult with
legal counsel (who may be counsel for the Company or the Borrower), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agent. Neither the Agent nor any of its
affiliates nor any of their respective directors, officers, agents or employees
shall be liable for any action taken or not taken by it in connection herewith
(i) with the consent or at the request of the Required Banks or (ii) in the
absence of its own gross negligence or willful misconduct. Neither the Agent nor
any of its affiliates nor any of their respective directors, officers, agents or
employees shall be responsible for or have any duty to ascertain, inquire into
or verify (i) any statement, warranty or representation made in connection with
this Agreement or any borrowing hereunder; (ii) the performance or observance of
any of the covenants or agreements of the Borrower or the Company; (iii) the
satisfaction of any condition specified in Article 3, except receipt of items
required to be delivered to the Agent; or (iv) the validity, effectiveness or
30
genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection herewith. The Agent shall not incur any liability by
acting in reliance upon any notice, consent, certificate, statement, or other
writing (which may be a bank wire, telex, facsimile transmission or similar
writing) believed by it to be genuine or to be signed by the proper party or
parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in accordance
with its Commitment, indemnify the Agent, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by the
Borrower) against any cost, expense (including counsel fees and disbursements),
claim, demand, action, loss or liability (except such as result from such
indemnitees' gross negligence or willful misconduct) that such indemnitees may
suffer or incur in connection with this Agreement or any action taken or omitted
by such indemnitees hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.08. Successor Agent. The Agent may resign at any time by
giving notice thereof to the Banks, the Company and the Borrower. Upon any such
resignation, the Required Banks (80%) shall have the right to appoint a
successor Agent reasonably acceptable to the Borrower. If no successor Agent
shall have been so appointed by the Required Banks (80%), and shall have
accepted such appointment, within 30 days after the retiring Agent gives notice
of resignation, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent reasonably acceptable to the Borrower, which shall be a
commercial bank organized or licensed under the laws of the United States of
America or of any State thereof and having a combined capital and surplus of at
least $1,000,000,000. Upon the acceptance of its appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as 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 Agent.
SECTION 7.09. Agent's Fee. The Company shall pay to the Agent for its
own account fees in the amounts and at the times previously agreed upon in
writing between the Company and the Agent.
SECTION 7.10. Co-Syndication Agents. The Co-Syndication Agents shall
have no responsibility or obligation under this Agreement in their capacity as
Co-Syndication Agents.
ARTICLE 8
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair.
31
If on or prior to the first day of any Interest Period for any Euro-Dollar Loan
or Money Market LIBOR Loan:
(a) the Agent is advised by the Reference Banks that deposits in
dollars (in the applicable amounts) are not being offered to the Reference Banks
in the London interbank market for such Interest Period, or
(b) in the case of a Committed Borrowing, Banks having 50% or more of
the aggregate amount of the Commitments advise the Agent that the Adjusted
London Interbank Offered Rate as determined by the Agent will not adequately and
fairly reflect the cost to such Banks of funding their Euro-Dollar Loans for
such Interest Period, the Agent shall forthwith give notice thereof to the
Borrower and the Banks, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, (i) the
obligations of the Banks to make Euro-Dollar Loans or to convert outstanding
Loans into Euro-Dollar Loans shall be suspended and (ii) each outstanding
Euro-Dollar Loan shall be converted into a Base Rate Loan on the last day of the
then current Interest Period applicable thereto. Unless the Borrower notifies
the Agent by telephone (confirmed in writing) before the date of any Fixed Rate
Borrowing for which a Notice of Borrowing has previously been given that it
elects not to borrow on such date, thereby revoking such Notice of Borrowing,
(i) if such Fixed Rate Borrowing is a Committed Borrowing, such Borrowing shall
instead be made as a Base Rate Borrowing and (ii) if such Fixed Rate Borrowing
is a Money Market LIBOR Borrowing, the Money Market LIBOR Loans comprising such
Borrowing shall bear interest for each day from and including the first day to
but excluding the last day of the Interest Period applicable thereto at the Base
Rate for such day.
SECTION 8.02. Illegality. If, on or after the date of this Agreement,
the adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Euro-Dollar Lending Office) with any request or directive
(whether or not having the force of law, but if not having the force of law, the
compliance with which is in accordance with the general practice of Persons to
whom such request or directive is addressed) of any such authority, central bank
or comparable agency shall make it unlawful or impossible for any Bank (or its
Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar Loans to
the Borrower and such Bank shall so notify the Agent, the Agent shall forthwith
give notice thereof to the other Banks and the Borrower, whereupon until such
Bank notifies the Borrower and the Agent that the circumstances giving rise to
such suspension no longer exist, the obligation of such Bank to make Euro-Dollar
Loans to the Borrower, or to convert outstanding Loans into Euro-Dollar Loans,
shall be suspended. Before giving any notice to the Agent pursuant to this
Section, such Bank shall designate a different Euro-Dollar Lending Office if
such designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise materially disadvantageous to such Bank. If
such notice is given, each Euro-Dollar Loan of such Bank then outstanding shall
be converted to a Base Rate Loan either (a) on the last day of the then current
Interest Period applicable to such Euro-Dollar Loan if such Bank may lawfully
continue to maintain and fund such Loan to such day or (b) immediately if such
Bank shall determine that it may not lawfully continue to maintain and fund such
Loan to such day.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on or after (x)
the date hereof, in the case of any Committed Loan or any obligation to make
32
Committed Loans or (y) the date of the related Money Market Quote, in the case
of any Money Market Loan, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law,
but if not having the force of law, the compliance with which is in accordance
with the general practice of Persons to whom such request or directive is
addressed) of any such authority, central bank or comparable agency shall
impose, modify or deem applicable any reserve (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding any such requirement included in an applicable Euro-Dollar
Reserve Percentage), special deposit, insurance assessment or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Applicable Lending Office) or shall impose on any
Bank (or its Applicable Lending Office) or the London interbank market any other
condition affecting its Fixed Rate Loans, its Note or its obligation to make
Fixed Rate Loans (in each case other than the imposition of or increase in any
reserve requirements covered by the definition of "Euro-Dollar Reserve
Percentage") and the result of any of the foregoing is to increase the cost to
such Bank (or its Applicable Lending Office) of making or maintaining any Fixed
Rate Loan, or to reduce the amount of any sum received or receivable by such
Bank (or its Applicable Lending Office) under this Agreement or under its Note
with respect thereto, by an amount deemed by such Bank to be material, then,
within 15 days after demand by such Bank (with a copy to the Agent), the
Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change in any such law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law, but if not having the force of law, the compliance with
which is in accordance with the general practices of Persons to whom such
request or directive is addressed) of any such authority, central bank or
comparable agency (including any determination by any such authority, central
bank or comparable agency that, for purposes of capital adequacy requirements,
the Commitments hereunder do not constitute commitments with an original
maturity of one year or less), has or would have the effect of reducing the rate
of return on capital of such Bank (or its Parent) as a consequence of such
Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within 15
days after demand by such Bank (with a copy to the Agent), the Borrower shall
pay to such Bank such additional amount or amounts as will compensate such Bank
(or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Applicable Lending Office if such designation will avoid the need for,
or reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise materially disadvantageous to such Bank. Any Bank claiming
33
compensation under this Section shall deliver to the Borrower, as a condition to
the payment of such compensation, a certificate of an officer of such Bank
setting forth the additional amount or amounts to be paid to it hereunder, which
certificate (x) shall contain reasonable details as to the calculation of such
amount or amounts, provided that such Bank shall not be required to disclose any
information it considers to be confidential, and (y) shall confirm that such
amount or amounts (A) have been calculated on the same basis as the amounts then
being charged by such Bank to its other similarly situated borrowers for the
periods to be covered thereby, (B) are necessary to compensate such Bank for
such additional cost or reduction in return and (C) are compensation for periods
commencing no more than 180 days before the date on which such certificate was
delivered to the Borrower, plus any period of retroactivity applicable to the
relevant adoption or change. In determining such amount or amounts, such Bank
may use any reasonable averaging and attribution methods. If any element of any
such calculation subsequently changes, so as to change materially such amount or
amounts, such Bank will submit a revised certificate promptly to the Borrower.
SECTION 8.04. Taxes. (a) For the purposes of this Section 8.04, the
following terms have the following meanings:
"Taxes" means any and all present or future withholding taxes or
similar duties, levies, imposts, deductions or charges with respect to any
payment by the Borrower or the Company pursuant to this Agreement or under any
Note, and all liabilities with respect thereto, excluding (i) in the case of
each Bank and the Agent, taxes imposed on its income, and franchise or similar
taxes imposed on it, by a jurisdiction under the laws of which such Bank or the
Agent (as the case may be) is organized or in which its principal executive
office is located or, in the case of each Bank, in which its Applicable Lending
Office is located and (ii) in the case of each Bank and the Agent, any United
States tax imposed on such payments but only to the extent that such Bank (or,
with respect to payments to it for its own account pursuant to Section 7.09, the
Agent) is subject to such United States tax at the time such Bank or the Agent
(as the case may be) first becomes a party to this Agreement.
"Other Taxes" means any present or future Canadian stamp or documentary
taxes and any other Canadian excise or property taxes, or similar Canadian
charges or levies, which arise from any payment made pursuant to this Agreement
or under any Note or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note.
(b) Any and all payments by the Borrower or the Company to or for the
account of any Bank or the Agent hereunder or under any Note shall be made
without deduction for any Taxes or Other Taxes; provided that, if the Borrower
or the Company shall be required by law to deduct any Taxes or Other Taxes from
any such payments, (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) such Bank or the Agent (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 or the Company shall make such
deductions, (iii) the Borrower or the Company shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law and (iv) the Borrower or the Company shall furnish to such Bank
or the Agent (as the case may be), at its address referred to in Section 10.01,
the original or a certified copy of a receipt evidencing payment thereof.
(c) The Borrower agrees to indemnify each Bank and the Agent for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes or
34
Other Taxes imposed or asserted on amounts payable under this Section) paid by
such Bank or the Agent (as the case may be) and any liability (including
penalties, interest and expenses arising from the failure of the Borrower to pay
such Taxes or Other Taxes when due) arising therefrom or with respect thereto,
in each case upon receipt by the Borrower of documentation reasonably
satisfactory to it concerning the existence and amount of such Taxes, Other
Taxes or liability. This indemnification shall be paid within 15 days after such
Bank or the Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each such Bank listed on the signature pages hereof and
on or prior to the date on which it becomes a Bank in the case of each other
such Bank, and from time to time thereafter if requested in writing by the
Borrower (but only so long as such Bank remains lawfully able to do so), shall
provide the Borrower and the Agent with Internal Revenue Service form 1001 or
4224, as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Bank is entitled to benefits under an income tax
treaty to which the United States is a party which exempts the Bank from United
States withholding tax or reduces the rate of withholding tax on payments of
interest for the account of such Bank or certifying that the income receivable
pursuant to this Agreement is effectively connected with the conduct of a trade
or business in the United States. If the Agent is organized under the laws of a
jurisdiction outside the United States, it shall likewise provide such a form
with respect to payments of fees for its own account pursuant to Section 7.09.
(e) For any period with respect to which a Bank or the Agent has
failed to provide the Borrower with the appropriate certificate pursuant to
Section 8.04(d) (unless such failure is due to change in treaty, law or
regulation occurring subsequent to the date on which such certificate originally
was required to be provided), such Bank (or with respect to payments to it for
its own account pursuant to Section 7.09, the Agent) shall not be entitled to
indemnification under Section 8.04(b) or (c) with respect to Taxes imposed by
the United States; provided that if a Bank or the Agent, which is otherwise
exempt from or subject to a reduced rate of withholding tax, becomes subject to
Taxes because of its failure to deliver a certificate required hereunder, the
Borrower shall take such steps as such Bank or the Agent shall reasonably
request to assist such Bank or the Agent to recover such Taxes.
(f) If the Borrower or the Company is required to pay additional
amounts to or for the account of any Bank pursuant to this Section, then such
Bank will change the jurisdiction of its Applicable Lending Office if, in the
judgment of such Bank, such change (i) will eliminate or reduce any such
additional payment which may thereafter accrue and (ii) is not otherwise
disadvantageous to such Bank.
SECTION 8.05. Base Rate Loans Substituted for Affected Euro-Dollar
Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans to the
Borrower has been suspended pursuant to Section 8.02 or (ii) any Bank has
demanded compensation under Section 8.03 or 8.04 with respect to its Euro-
Dollar Loans and the Borrower shall, by at least five Euro-Dollar Business Days'
prior notice to such Bank through the Agent, have elected that the provisions of
this Section shall apply to such Bank, then, unless and until such Bank notifies
the Borrower that the circumstances giving rise to such suspension or demand for
compensation no longer exist:
(a) all Loans to the Borrower which would otherwise be made by such
35
Bank as (or continued as or converted into) Euro-Dollar Loans shall instead be
Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks); and
(b) after each of its Euro-Dollar Loans to the Borrower has been
repaid (or converted to a Base Rate Loan), all payments of principal which would
otherwise be applied to repay such Euro-Dollar Loans shall be applied to repay
its Base Rate Loans instead.
SECTION 8.06. Substitution of Bank. If (i) the obligation of any Bank
to make Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii)
any Bank has demanded compensation under Section 8.03 or 8.04, the Borrower
shall have the right, with the assistance of the Agent, to seek a mutually
satisfactory substitute bank or banks (which may be one or more of the Banks) to
purchase the Note and assume the Commitment of such Bank, which agrees in such
event to sell its Note and transfer its Commitment.
ARTICLE 9
GUARANTY
SECTION 9.01. The Guaranty. The Company hereby unconditionally
guarantees the full and punctual payment (whether at stated maturity, upon
acceleration or otherwise) of the principal of and interest on each Note issued
by the Borrower pursuant to this Agreement, and the full and punctual payment of
all other amounts payable by the Borrower under this Agreement. Upon failure by
the Borrower to pay punctually any such amount, the Company shall forthwith on
demand pay the amount not so paid at the place and in the manner specified in
this Agreement.
SECTION 9.02. Guaranty Unconditional. The obligations of the Company
hereunder shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise, waiver or release
in respect of any obligation of the Borrower under this Agreement or
any Note, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to this
Agreement or any Note;
(iii) any release, impairment, non-perfection or invalidity of any
direct or indirect security for any obligation of the Borrower under
this Agreement or any Note;
(iv) any change in the corporate existence, structure or ownership of
the Borrower or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting the Borrower or its assets or any
resulting release or discharge of any obligation of the Borrower
contained in this Agreement or any Note;
(v) the existence of any claim, set-off or other rights which the
Company may have at any time against the Borrower, the Agent, any Bank
or any other Person, whether in connection herewith or any unrelated
transactions, provided that nothing herein shall prevent the assertion
of any such claim by separate suit or compulsory counterclaim;
36
(vi) any invalidity or unenforceability relating to or against the
Borrower for any reason of this Agreement or any Note, or any provision
of applicable law or regulation purporting to prohibit the payment by
the Borrower of the principal of or interest on any Note or any other
amount payable by it under this Agreement; or
(vii) any other act or omission to act or delay of any kind by the
Borrower, the Agent, any Bank or any other Person or any other
circumstance whatsoever which might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of the Company's
obligations hereunder.
SECTION 9.03. Discharge Only upon Payment in Full; Reinstatement in
Certain Circumstances. The Company's obligations hereunder shall remain in full
force and effect until the Commitments shall have terminated and the principal
of and interest on the Notes and all other amounts payable by the Company and
the Borrower under this Agreement shall have been paid in full. If at any time
any payment of the principal of or interest on any Note or any other amount
payable by the Borrower under this Agreement is rescinded or must be otherwise
restored or returned upon the insolvency, bankruptcy or reorganization of the
Borrower or otherwise, the Company's obligations hereunder with respect to such
payment shall be reinstated at such time as though such payment had been due but
not made at such time.
SECTION 9.04. Waiver by the Company. The Company irrevocably waives
acceptance hereof, presentment, demand, protest and any notice not provided for
herein, as well as any requirement that at any time any action be taken by any
Person against the Borrower or any other Person.
SECTION 9.05. Subrogation. Upon making any payment hereunder, the
Company shall be subrogated to the rights of the payee against the Borrower with
respect to such payment; provided that the Company shall not enforce any payment
by way of subrogation until the Commitments have terminated and all amounts
payable under this Agreement shall have been paid in full.
SECTION 9.06. Stay of Acceleration. In the event that acceleration of
the time for payment of any amount payable by the Borrower under this Agreement
orits Notes is stayed upon insolvency, bankruptcy or reorganization of the
Borrower, all such amounts otherwise subject to acceleration under the terms of
this Agreement shall nonetheless be payable by the Company hereunder forthwith
on demand by the Agent made at the request of the Required Banks.
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices. Except as otherwise expressly provided herein,
all notices, requests and other communications to any party hereunder shall be
in writing (including bank wire, telex, facsimile transmission or similar
writing and, with respect to the reports and other information referred to in
the next sentence, by e-mail or other electronic means) and shall be given to
such party: (a) in the case of the Borrower, the Company or the Agent, at its
address, facsimile number or telex number set forth on the signature pages
hereof, (b) in the case of any Bank, at its address, facsimile number, telex
number or e-mail address set forth in its Administrative Questionnaire or (c) in
the case of any party, such other address, facsimile number, telex number or
e-mail address as such party may hereafter specify for the purpose by notice to
the Agent, the Borrower and the Company. All reports and other information
37
required to be delivered to the Banks pursuant to Section 5.01(a), (b), (c), (e)
or (f) may be delivered by e-mail (either as an e-mail attachment or by
including an appropriate internet link to such reports or other information).
Each such notice, request or other communication shall be effective (i) if given
by telex, when such telex is transmitted to the telex number specified in this
Section and the appropriate answerback is received, (ii) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (iii) if given by e-mail, when such
e-mail is transmitted to the e-mail addressed specified in this Section, or (iv)
if given by any other means, when delivered at the address specified in this
Section; provided that notices to the Agent under Article 2 or Article 8 shall
not be effective until received.
SECTION 10.02. No Waivers. No failure or delay by the Agent or any Bank
in exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 10.03. Expenses; Indemnification. (a) The Borrower shall pay
(i) all reasonable out-of-pocket expenses of the Agent, including fees and
disbursements of special counsel for the Agent, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all reasonable out-of-pocket expenses
incurred by the Agent and each Bank, including (without duplication) the fees
and disbursements of outside counsel, in connection with such Event of Default
and collection, bankruptcy, insolvency and other enforcement proceedings
resulting therefrom.
(b) The Borrower agrees to indemnify the Agent and each Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection
with any investigative, administrative or judicial proceeding (whether or not
such Indemnitee shall be designated a party thereto) brought or threatened by a
Person which is not a party hereto or an Affiliate of a party hereto relating to
any actual, proposed or potential use of proceeds of Loans hereunder; provided
that no Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee's own gross negligence or willful misconduct as determined by a court
of competent jurisdiction.
SECTION 10.04. Sharing of Set-offs. Each Bank agrees that if it shall,
by exercising any right of set-off or counterclaim or otherwise, receive payment
of a proportion of the aggregate amount of principal and interest relating to
its Committed Loans which is greater than the proportion received by any other
Bank in respect of the aggregate amount of principal and interest relating to
the Committed Loans of such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Notes held by the
other Banks, and such other adjustments shall be made, as may be required so
that all such payments of principal and interest relating to Committed Loans of
the Banks shall be shared by the Banks pro rata; provided that nothing in this
Section shall impair the right of any Bank to exercise any right of set-off or
counterclaim it may have and to apply the amount subject to such exercise to the
38
payment of indebtedness of the Borrower other than its indebtedness hereunder.
SECTION 10.05. Amendments and Waivers. Any provision of this Agreement
or the Notes may be amended or waived if, but only if, such amendment or waiver
is in writing and is signed by the Borrower, the Company and the Required Banks
(and, if the rights or duties of the Agent are affected thereby, by the Agent);
provided that no such amendment or waiver shall, unless signed by all the Banks,
(i) increase or decrease the Commitment of any Bank (except for a ratable
decrease in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan, or any
fees hereunder, (iii) postpone the date fixed for any payment of principal of or
interest on any Loan, or any fees hereunder or for any scheduled reduction or
termination of any Commitment, (iv) release the Company from its obligations
under Article 9 or (v) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of Banks, which
shall be required for the Banks or any of them to take any action under this
Section or any other provision of this Agreement.
SECTION 10.06. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that neither the Borrower
nor the Company may assign or otherwise transfer any of its rights under this
Agreement without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrower and the Agent, such Bank shall remain responsible for the performance
of its obligations hereunder, and the Borrower and the Agent shall continue to
deal solely and directly with such Bank in connection with such Bank's rights
and obligations under this Agreement. Any agreement pursuant to which any Bank
may grant such a participating interest shall provide that such Bank shall
retain the sole right and responsibility to enforce the obligations of the
Borrower hereunder including, without limitation, the right to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such participation agreement may provide that such Bank will not agree to
any modification, amendment or waiver of this Agreement described in clause (i),
(ii), (iii) or (iv) of Section 10.05 without the consent of the Participant. The
Borrower agrees that each Participant shall, to the extent provided in its
participation agreement, be entitled to the benefits of Article 8 with respect
to its participating interest. An assignment or other transfer which is not
permitted by subsection (c) or (d) below shall be given effect for purposes of
this Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part (equivalent to an
initial Commitment of not less than $10,000,000) of all, of its rights and
obligations under this Agreement and the Notes, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Assumption Agreement
in substantially the form of Exhibit H hereto executed by such Assignee and such
transferor Bank, with (and subject to) the subscribed consent of the Company,
the Borrower and the Agent, which shall not be unreasonably withheld; provided
that if an Assignee is an affiliate of such transferor Bank or was a Bank
immediately prior to such assignment, no such consent shall be required; and
provided further that such assignment may, but need not, include rights of the
39
transferor Bank in respect of outstanding Money Market Loans. Upon execution and
delivery of such instrument and payment by such Assignee to such transferor Bank
of an amount equal to the purchase price agreed between such transferor Bank and
such Assignee, such Assignee shall be a Bank party to this Agreement and shall
have all the rights and obligations of a Bank with a Commitment as set forth in
such instrument of assumption, and the transferor Bank shall be released from
its obligations hereunder to a corresponding extent, and no further consent or
action by any party shall be required. Upon the consummation of any assignment
pursuant to this subsection (c), the transferor Bank, the Agent and the Borrower
shall make appropriate arrangements so that, if required, a new Note is issued
to the Assignee. In connection with any such assignment, the transferor Bank
shall pay to the Agent an administrative fee for processing such assignment in
the amount of $2,500. If the Assignee is not incorporated under the laws of the
United States of America or a state thereof, it shall deliver to the Borrower
and the Agent certification as to exemption from deduction or withholding of any
United States federal income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its rights
under this Agreement and its Notes to a Federal Reserve Bank. No such assignment
shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights
shall be entitled to receive any greater payment under Section 8.03 or 8.04 than
such Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by reason of the provisions of Section 8.02, 8.03 or 8.04 requiring
such Bank to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
SECTION 10.07. Collateral. Each of the Banks represents to the Agent
and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 10.08. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. Each of the Borrower and the Company hereby
submits to the nonexclusive jurisdiction of the United States District Court for
the Southern District of New York and of any New York State court sitting in New
York City for purposes of all legal proceedings arising out of or relating to
this Agreement or the transactions contemplated hereby. Each of the Borrower and
the Company irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
SECTION 10.09. Counterparts; Integration; Effectiveness. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective upon receipt by the Agent of counterparts
hereof signed by each of the Borrower, the Company, the Banks and the Agent (or,
in the case of any party as to which an executed counterpart shall not have been
received, receipt by the Agent in form satisfactory to it of telegraphic, telex,
40
facsimile or other written confirmation from such party of execution of a
counterpart hereof by such party).
SECTION 10.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE COMPANY,
THE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 10.11. Confidentiality. The Agent and each Bank agree to keep
confidential any information obtained by the Agent or such Bank from the Company
or the Borrower to the extent such information has been stated by the Company or
the Borrower to be confidential, provided that nothing herein shall prevent the
Agent or any Bank from disclosing such information (i) to the Agent or any other
Bank in connection with the transactions contemplated by this Agreement, (ii) to
its officers, directors, employees, Affiliates, agents, attorneys and
accountants who have a need to know such information in accordance with
customary banking practices and who receive such information having been made
aware of the restrictions set forth in this Section, (iii) upon the order of any
court or administrative agency, (iv) upon the request or demand of any
regulatory agency or authority having jurisdiction over such party, (v) which
has been publicly disclosed, (vi) which has been obtained from any Person other
than the Borrower and its Affiliates, provided that such Person is not known to
it to be bound by a confidentiality agreement with the Company or its Affiliates
or known to it to be otherwise prohibited from transmitting the information to
it by a contractual, legal or fiduciary obligation or (vii) in connection with
the exercise of any remedy hereunder in any judicial proceeding.
SECTION 10.12. Termination of Existing Credit Agreements. Each of the
Company, the Borrower and each of the Banks that is also a "Bank" party to the
Existing Credit Agreements agrees that the "Commitments" as defined in the
Existing Credit Agreements shall be terminated in their entirety on the
Effective Date. Each of such Banks and ▇▇▇▇▇▇ Guaranty Trust Company of New
York, as agent under the Existing Credit Agreements, waives (a) any requirement
of notice of such termination pursuant to Section 2.09 of the Existing Credit
Agreements and (b) any claim to any facility fees under the Existing Credit
Agreements for any day on or after the Effective Date. Each of the Company and
the Borrower (i) represents and warrants that (x) after giving effect to the
preceding sentences of this Section 10.12, the commitments under the Existing
Credit Agreements will be terminated effective not later than the Effective
Date, and (y) no loans are, as of the date hereof, or will be, as of the
Effective Date, outstanding under the Existing Credit Agreements and (ii)
covenants that all accrued and unpaid facility fees and any other amounts due
and payable under the Existing Credit Agreements shall have been paid on or
prior to the Effective Date.
41
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
NORTEL NETWORKS CORPORATION,
as Guarantor
By /s/ K.B. ▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Treasurer
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Assistant Secretary
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Treasurer
NORTEL NETWORKS INC.,
as Borrower
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Title: Treasurer
Address: Northern Telecom Plaza
▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Treasurer
42
BANKS
-----
By signing below, each Bank confirms that (x) it is organized under the
laws of, or is acting through an office, branch or agency located in, the United
States, or that the income receivable by it pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States or (y) it is entitled to benefits under an income tax treaty to which the
United States is a party which exempts such Bank from United States withholding
tax.
Commitments
$38,500,000 ▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Associate
$42,500,000 ABN AMRO BANK N.V.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Group Vice President
By /s/ ▇▇▇▇▇▇▇ O'▇. ▇▇▇▇▇
----------------------------------
Title: Senior Vice President
$42,500,000 BANK OF AMERICA, N.A.
By /s/ ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇
----------------------------------
Title: Vice President
$42,500,000 CITIBANK N.A.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$23,333,333 ROYAL BANK OF CANADA
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Senior Account Manager
$23,333,333 TORONTO DOMINION (TEXAS), INC.
By /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
$38,000,000 THE BANK OF NOVA SCOTIA
By /s/ ▇▇▇▇ House
----------------------------------
Title: Director
By /s/ ▇▇▇▇ ▇▇▇
----------------------------------
Title: Associate
$50,666,667 BANQUE NATIONALE DE PARIS,
NEW YORK BRANCH
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
$38,000,000 THE BANK OF TOKYO-MITSUBISHI
LTD., NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: Attorney-in-Fact
$38,000,000 THE CHASE MANHATTAN BANK
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$38,000,000 CREDIT SUISSE FIRST BOSTON
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$38,000,000 HSBC BANK USA
By /s/ ▇▇▇▇ ▇▇▇▇
----------------------------------
Title: Assistant Vice President
$38,000,000 DEUTSCHE BANK AG, NEW YORK
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Title: Director
$50,666,667 BANK ONE, NA (CHICAGO MAIN OFFICE)
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: Senior Vice President
$50,666,667 BARCLAYS BANK PLC
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Director
$50,666,667 SUNTRUST BANK
By /s/ J. ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$50,666,667 WESTDEUTSCHE LANDESBANK
GIROZENTRALE, NEW YORK BRANCH
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Managing Director
By /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Title: Associate
$50,666,667 FLEET NATIONAL BANK
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: Vice President
$7,333,330 SOCIETE GENERALE, SOUTHWEST AGENCY
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: Vice President
$33,000,000 BANK OF MONTREAL
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Director
$33,000,000 THE INDUSTRIAL BANK OF JAPAN,
LIMITED
By /s/ Minami Miura
----------------------------------
Title: Vice President
$30,000,000 BANCO BILBAO VIZCAYA
ARGENTARIA, S.A.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Senior Vice President
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: Vice President
$30,000,000 ING BANK N.V.
By /s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: Vice President
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Title: Assistant Manager,
Corporate Lending
$30,000,000 WACHOVIA BANK, N.A.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$30,000,000 BANCA COMMERCIALE ITALIANA -
NEW YORK BRANCH
By /s/ ▇. ▇▇▇▇▇▇▇
----------------------------------
Title: First Vice President/
Deputy Manager
By /s/ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
$20,666,666 THE SUMITOMO BANK, LIMITED
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
---------------------------------
Title: Senior Vice President
$24,666,666 BANCO SANTANDER CENTRAL
HISPANO, S.A., NEW YORK BRANCH
By /s/ R.E. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Title: Vice President
$16,666,667 DRESDNER BANK, AG (NEW YORK BRANCH)
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Assistant Vice President
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Title: First Vice President
Total Commitments
-----------------
$ 1,000,000,000
ABN AMRO BANK N.V.,
as Co-Syndication Agent
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Group Vice President
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
BANK OF AMERICA, N.A.,
as Co-Syndication Agent
By /s/ ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇
----------------------------------
Title: Vice President
CITIBANK N.A.,
as Co-Syndication Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK,
as Administrative Agent
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Associate
Address: ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
43
EXHIBIT A - Note
NOTE
New York, New York
, 2000
----------- --
For value received, NORTEL NETWORKS INC., a Delaware corporation (the
"Borrower"), promises to pay to the order of (the "Bank"), for the account of
its Applicable Lending Office, the unpaid principal amount of each Loan made by
the Bank to the Borrower pursuant to the Credit Agreement referred to below on
the maturity date specified therefor in the Credit Agreement. The Borrower
promises to pay interest on the unpaid principal amount of each such Loan on the
dates and at the rate or rates provided for in the Credit Agreement. All such
payments of principal and interest shall be made in lawful money of the United
States in Federal or other funds immediately available at the office of ▇▇▇▇▇▇
Guaranty Trust Company of New York, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
All Loans made by the Bank, the respective types and maturities thereof
and all repayments of the principal thereof shall be recorded by the Bank and,
if the Bank so elects in connection with any transfer or enforcement hereof,
appropriate notations to evidence the foregoing information with respect to each
such Loan then outstanding may be endorsed by the Bank on the schedule attached
hereto, or on a continuation of such schedule attached to and made a part
hereof; provided that the failure of the Bank to make any such recordation or
endorsement shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement.
This note is one of the Notes referred to in the 364 Day Credit
Agreement dated as of April 12, 2000 among Nortel Networks Inc., Nortel Networks
Corporation, the banks and co-syndication agents parties thereto and ▇▇▇▇▇▇
Guaranty Trust Company of New York, as Administrative Agent (as the same may be
amended from time to time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings. Reference is made to the
Credit Agreement for provisions for the prepayment hereof and the acceleration
of the maturity hereof.
The payment in full of the principal of and interest on this note has,
pursuant to the provisions of the Credit Agreement, been unconditionally
guaranteed by Nortel Networks Corporation.
NORTEL NETWORKS INC.
By
--------------------
Name:
Title:
44
LOANS AND PAYMENTS OF PRINCIPAL
-------------------------------------------------------------------
Amount Type Amount of
of of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
----- -------- ------ ----------- ---------- ---------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
45
EXHIBIT B - Money Market Quote Request
Form of Money Market Quote Request
[Date]
To: ▇▇▇▇▇▇ Guaranty Trust Company of New York, as Administrative Agent
(the "Agent")
From: Nortel Networks Inc.
Re: 364 Day Credit Agreement (as amended from time to time, the "Credit
Agreement") dated as of April 12, 2000 among Nortel Networks Inc.,
Nortel Networks Corporation, the Banks and Co-Syndication Agents
parties thereto and the Agent
We hereby give notice pursuant to Section 2.03 of the Credit
Agreement that we request Money Market Quotes for the following proposed Money
Market Borrowing(s):
Date of Borrowing:
------------------
Principal Amount(1) Interest Period(2)
------------------- -----------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Terms used herein have the meanings assigned to them in the Credit
Agreement.
NORTEL NETWORKS INC.
By
------------------------
Name:
Title:
--------
(1) Amount must be $25,000,000 or a larger multiple of $5,000,000.
(2) Not less than one month (LIBOR Auction) or not less than 14 days
(Absolute Rate Auction), subject to the provisions of the definition of Interest
Period.
46
EXHIBIT C - Invitation for Money Market Quotes
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes to Nortel Networks Corporation
(the "Borrower")
Pursuant to Section 2.03 of the 364 Day Credit Agreement dated as of
April 12, 2000 among Nortel Networks Inc., Nortel Networks Corporation, the
Banks and Co-Syndication Agents parties thereto and the undersigned, as
Administrative Agent, as amended from time to time, we are pleased on behalf of
the Borrower to invite you to submit Money Market Quotes to the Borrower for the
following proposed Money Market Borrowing(s):
Date of Borrowing:
------------------
Principal Amount Interest Period
---------------- ---------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.] Please respond to this invitation by no later than [10:00 A.M.] [9:30
A.M.] (New York City time) on [date].
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK, as
Administrative Agent
By
------------------------
Authorized Officer
47
EXHIBIT D - Money Market Quote
Form of Money Market Quote
To: ▇▇▇▇▇▇ Guaranty Trust Company of New York, as Administrative Agent
Re: Money Market Quote to Nortel Networks Inc. (the "Borrower")
In response to your invitation on behalf of the Borrower dated , , we
hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank:
------------------------------
2. Person to contact at Quoting Bank:
3. Date of Borrowing: *
---------------------
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
-------- --------- ------------- ------------------------
$
$
[Provided, that the aggregate principal amount of Money Market Loans for
which the above offers may be accepted shall not exceed $ .]**
----------
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal amount
requested. Specify aggregate limitation if the sum of the individual offers
exceeds the amount the Bank is willing to lend. Bids must be made for $5,000,000
or a larger multiple of $1,000,000.
(notes continued on following page)
48
We understand and agree that the offer(s) set forth above, subject to the
satisfaction of the applicable conditions set forth in the 364 Day Credit
Agreement dated as of April 12, 2000 among Nortel Networks Inc., Nortel Networks
Corporation, the Banks and Co-Syndication Agents parties thereto and yourselves,
as Administrative Agent, as amended from time to time, irrevocably obligates us
to make the Money Market Loan(s) for which any offer(s) are accepted, in whole
or in part.
Very truly yours,
[NAME OF BANK]
Dated: By:
--------------- -----------------------
Authorized Officer
----------
*** Not less than one month or not less than 14 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period. Specify percentage (to the nearest 1/10,000 of 1%)
and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
49
EXHIBIT E - Opinion of Counsel for the Company
OPINION OF
COUNSEL FOR THE COMPANY
, 2000
----------------
To the Banks and the Administrative Agent
Referred to Below
c/▇ ▇▇▇▇▇▇ Guaranty Trust Company
of New York, as Administrative Agent
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
I am Chief Legal Officer of Nortel Networks Corporation (the
"Corporation") and give this opinion pursuant to Section 3.01(b) of the 364 Day
Credit Agreement (the "Credit Agreement") dated as of April 12, 2000 among the
Corporation, Nortel Networks Inc., the banks and co-syndication agents parties
thereto and ▇▇▇▇▇▇ Guaranty Trust Company of New York, as Administrative Agent.
Terms defined in the Credit Agreement are used herein as therein defined.
I have examined originals or copies, certified or otherwise identified
to my satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as I have deemed necessary or advisable for purposes of this
opinion.
In rendering this opinion, I have assumed:
(a) the signatures on the documents I have examined are originals; and
(b) with respect to the valid and binding nature of the Credit
Agreement and the delivery of the Credit Agreement, the laws of the State of New
York are the same as the laws of Canada.
The opinions expressed herein are subject to the following
qualifications:
(a) enforceability of the Credit Agreement may be limited by
bankruptcy, insolvency, or other laws affecting the enforcement of creditors'
rights generally;
(b) equitable remedies, including remedies of specific performance and
injunction, may only be granted in the discretion of a court of competent
jurisdiction;
(c) the Currency Act (Canada) precludes the courts in Canada from
awarding a judgment for an amount expressed in a currency other than Canadian
dollars; and
(d) any requirement to pay interest at a greater rate after than before
default may not be enforceable if the same is construed by a court to constitute
a penalty.
In expressing the opinions in paragraphs 1, 2 and 3 stated below, I
have relied exclusively upon the opinion of , Vice President
and Assistant General Counsel, Securities and Assistant Secretary of the
Corporation, dated the date hereof (the "Opinion"), a copy of which is attached
hereto as Schedule A. The opinions expressed herein are limited in scope to the
matters addressed in the Opinion, and to the extent any such opinion is stated
to be based on any assumption or to be given in reliance on any certificate or
other document or to be subject to any limitation, qualification or exemption,
the opinions expressed herein in reliance on such opinion are based upon the
same assumption, are given in reliance on the same certificate or document, and
are subject to the same limitation, qualification or exemption. I have reviewed
50
the Opinion and found it to be satisfactory in form and scope to address the
matter for which it has been relied upon by me herein.
Upon the basis of the foregoing, I am of the opinion that:
1. The Corporation is a corporation duly incorporated and validly
existing under the laws of Canada and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted, the absence of which would have a material
adverse effect on the ability of the Corporation to perform its obligations
under the Credit Agreement.
2. The execution, delivery and performance by the Corporation of the
Credit Agreement (i) are within the Corporation's corporate powers and have been
duly authorized by all necessary corporate action, (ii) require no action by or
in respect of, or filing with, any governmental body, agency or official, and
(iii) do not contravene any provision of applicable law or regulation or any
provision of the certificate of incorporation or by-laws of the Corporation or
any contractual restriction, order, decree or other instrument binding upon the
Corporation or any of its Subsidiaries, except in the case of (ii) and (iii)
above, any such action, filing or contravention which would not have a material
adverse effect on the ability of the Corporation to perform its obligations
under the Credit Agreement.
3. The Credit Agreement constitutes a valid and binding agreement of
the Corporation, enforceable in accordance with its terms.
4. To the best of my knowledge, there is no action, suit or proceeding
pending or threatened against or affecting the Corporation or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official, in which there is a reasonable possibility of an adverse decision
which could have a material adverse effect on the ability of the Corporation to
perform its obligations under the Credit Agreement, or which in any manner draws
into question the validity of the Credit Agreement.
Yours truly,
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Legal Officer
51
Schedule A
----------
Nortel Networks Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
Dept. 0019, GMS ▇▇▇/▇▇/▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Tel:
Fax:
E-mail:
▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
April , 2000
Mr. N.J. ▇▇▇▇▇▇
Chief Legal Officer
Nortel Networks Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Dear Sir:
I am of Nortel Networks Corporation (the "Corporation"). I understand that you
will rely on this opinion letter in connection with the delivery of your opinion
pursuant to Section 3.01(b) of the Credit Agreement dated as of April 12, 2000
among the Corporation, Nortel Networks Inc., the banks (the "Banks") and
co-syndication agents parties thereto and ▇▇▇▇▇▇ Guaranty Trust Company of New
York, as Administrative Agent (the "Credit Agreement"). Terms defined in the
Credit Agreement are used herein as therein defined.
I have examined originals or copies, certified or otherwise identified to my
satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as I have deemed necessary or advisable for purposes of this
opinion.
In rendering this opinion, I have assumed:
(a) the signatures on the documents I have examined are originals; and
(b) with respect to the valid and binding nature of the Credit Agreement
and the delivery of the Credit Agreement, the laws of the State of New
York are the same as the laws of Canada.
I am qualified to practice law solely in the Province of Ontario, Canada and
express no opinion as to any laws or matters governed by any laws other than the
laws of the Province of Ontario and the federal laws of Canada applicable
therein.
The opinions expressed herein are subject to the following qualifications:
(a) enforceability of the Credit Agreement may be limited by bankruptcy,
insolvency, or other laws affecting the enforcement of creditors'
rights generally;
(b) equitable remedies, including remedies of specific performance and
injunction, may only be granted in the discretion of a court of
competent jurisdiction;
(c) the Currency Act (Canada) precludes the courts in Canada from
awarding a judgment for an amount expressed in a currency other than
52
Canadian dollars; and
(d) any requirement to pay interest at a greater rate after than before
default may not be enforceable if the same is construed by a court to
constitute a penalty.
Upon the basis of the foregoing, I am of the opinion that:
(a) the Corporation is a corporation duly incorporated and validly existing
under the laws of Canada and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted, the absence of which would
have a material adverse effect on the ability of the Corporation to
perform its obligations under the Credit Agreement;
(b) the execution, delivery and performance by the Corporation of the
Credit Agreement (i) are within the Corporation's corporate powers and
have been duly authorized by all necessary corporate action, (ii)
require no action by or in respect of, or filing with, any governmental
body, agency or official, and (iii) do not contravene any provision of
applicable law or regulation or any provision of the certificate of
incorporation or by-laws of the Corporation or any contractual
restriction, order, decree or other instrument binding upon the
Corporation or any of its Subsidiaries, except in the case of (ii) and
(iii) above, any such action, filing or contravention which would not
have a material adverse effect on the ability of the Corporation to
perform its obligations under the Credit Agreement;
(c) the Credit Agreement constitutes a valid and binding agreement of the
Corporation, enforceable in accordance with its terms; and
(d) to be best of my knowledge, there is no action, suit or proceeding
pending or threatened against or affecting the Corporation or any of
its Subsidiaries before any court or arbitrator or any governmental
body, agency or official, in which there is a reasonable possibility
of an adverse decision which could have a material adverse effect on
the ability of the Corporation to perform its obligations under the
Credit Agreement, or which in any manner would draw into question the
validity of the Credit Agreement.
This opinion is furnished solely for your benefit in connection with the
aforementioned delivery of your opinion letter (including as an attachment to
your opinion) in connection with the Credit Agreement and is not to be used,
circulated or quoted or otherwise referred to for any other purpose.
Yours truly,
53
EXHIBIT F - Opinion of Counsel for the Borrower
OPINION OF
COUNSEL FOR NORTEL NETWORKS
, 2000
---------- --
To the Banks and the Agent
Referred to Below
c/▇ ▇▇▇▇▇▇ Guaranty Trust Company
of New York, as Agent
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
I am [Associate] General Counsel of Nortel Networks Inc. (the
"Borrower") and give this opinion pursuant to Section 3.01(b) of the 364 Day
Credit Agreement (the "Credit Agreement") dated as of April 12, 2000 among
Nortel Networks Corporation (the "Company"), the Borrower, the banks and
co-agents parties thereto and ▇▇▇▇▇▇ Guaranty Trust Company of New York, as
Agent. Terms defined in the Credit Agreement are used herein as therein defined.
I have examined originals or copies, certified or otherwise identified
to my satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as I have deemed necessary or advisable for purposes of this
opinion.
The opinions expressed herein are subject to the following
qualifications:
(a) enforceability of the Credit Agreement and the Notes may
be limited by bankruptcy, insolvency, or other laws affecting the
enforcement of creditors' rights generally; and
(b) equitable remedies, including remedies of specific
performance and injunction, may only be granted in the discretion of a
court of competent jurisdiction.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower is a corporation duly incorporated and validly existing
and in good standing under the laws of the State of Delaware, and is a wholly
owned Consolidated Subsidiary of the Company. It has all corporate powers and
all governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted the absence of which would have a
material adverse impact on the ability of the Borrower to perform its
obligations under the Credit Agreement and the Notes.
2. The execution, delivery and performance by the Borrower of the
Credit Agreement and its Notes (i) are within the Borrower's corporate powers
and have been duly authorized by all necessary corporate action, (ii) require no
action by or in respect of, or filing with, any governmental body, agency or
official and (iii) do not contravene any provision of applicable law or
regulation or any provision of the certificate of incorporation or by-laws of
the Borrower or of any contractual restriction, order, decree or other
instrument binding upon the Borrower or any of its Subsidiaries, except, in the
case of (ii) and (iii) above, any such action, filing or contravention which
would not have a material adverse effect on the ability of the Borrower to
perform its obligations under the Credit Agreement and the Notes.
3. The Credit Agreement constitutes a valid and binding agreement of
the Borrower and each Note constitutes a valid and binding obligation of the
Borrower, in each case enforceable in accordance with its terms.
Very truly yours,
[Name]
[Associate] General Counsel
54
EXHIBIT G - Opinion of Special Counsel for the Administrative Agent
OPINION OF
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, SPECIAL COUNSEL
FOR THE ADMINISTRATIVE AGENT
, 2000
----------------
To the Banks and the Agent
Referred to Below
c/▇ ▇▇▇▇▇▇ Guaranty Trust Company,
as Administrative Agent
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
We have participated in the preparation of the 364 Day Credit Agreement
(the "Credit Agreement") dated as of April 12, 2000 among Nortel Networks
Corporation (the "Company"), Nortel Networks Inc. (the "Borrower"), the banks
(the "Banks") and Co-Syndication Agents parties thereto and ▇▇▇▇▇▇ Guaranty
Trust Company of New York, as Administrative Agent (the "Agent"), and have acted
as special counsel for the Agent for the purpose of rendering this opinion
pursuant to Section 3.01(c) of the Credit Agreement. Terms defined in the Credit
Agreement are used herein as therein defined.
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that, assuming
that the execution, delivery and performance by each of the Company and the
Borrower of the Credit Agreement and the execution, delivery and performance by
the Borrower of the Notes are within such Person's corporate powers and have
been duly authorized by all necessary corporate action, the Credit Agreement
constitutes a valid and binding agreement of each such Person and each Note
constitutes a valid and binding obligation of the Borrower, in each case
enforceable in accordance with its terms except as the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
by general principles of equity.
We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York. In giving the foregoing
opinion, we express no opinion as to the effect (if any) of any law of any
jurisdiction (except the State of New York) in which any Bank is located which
limits the rate of interest that such Bank may charge or collect.
This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
55
EXHIBIT H - Assignment and Assumption Agreement
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of , among [NAME OF ASSIGNOR] (the "Assignor"),
[NAME OF ASSIGNEE] (the "Assignee"), [NORTEL NETWORKS CORPORATION (the
"Company"), NORTEL NETWORKS INC. ("NNI") and ▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK, as Administrative Agent (the "Agent")].
WHEREAS, this Assignment and Assumption Agreement (the "Agreement")
relates to the 364 Day Credit Agreement dated as of April 12, 2000 among the
Company, NNI the Assignor and the other Banks and Co-Syndication Agents party
thereto, and the Agent (as amended from time to time, the "Credit Agreement");
[WHEREAS, as provided under the Credit Agreement, the Assignor has a
Commitment to make Committed Loans to NNI in an aggregate principal amount at
any time outstanding not to exceed $ ;]
WHEREAS, Committed Loans made to NNI by the Assignor under the Credit
Agreement in the aggregate principal amount of $ are outstanding at the date
hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the
rights of the Assignor under the Credit Agreement in respect of a portion of its
[Commitment thereunder in an amount equal to $ (the "Assigned Amount"), together
with a corresponding portion of its outstanding Committed Loans,] [outstanding
Committed Loans in an aggregate principal amount equal to $ (the "Assigned
Amount")](1) and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
--------
(1) Use second variation if Commitments have terminated.
56
SECTION 1. Definitions. All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Committed Loans made by the Assignor outstanding at the date hereof. Upon the
execution and delivery hereof by the Assignor, the Assignee, [the Company, NNI
and the Agent] and the payment of the amounts specified in Section 3 required to
be paid on the date hereof (i) the Assignee shall, as of the date hereof,
succeed to the rights and be obligated to perform the obligations of a Bank
under the Credit Agreement with [a Commitment] [outstanding Committed Loans](1)
in an amount equal to the Assigned Amount, and (ii) the [Commitment]
[outstanding Committed Loans](1) of the Assignor shall, as of the date hereof,
be reduced by a like amount and the Assignor released from its obligations under
the Credit Agreement to the extent such obligations have been assumed by the
Assignee. The assignment provided for herein shall be without recourse to the
Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them. It is
understood that facility fees accrued to the date hereof with respect to the
Assigned Amount are for the account of the Assignor and such fees accruing from
and including the date hereof with respect to the Assigned Amount are for the
account of the Assignee. Each of the Assignor and the Assignee hereby agrees
that if it receives any amount under the Credit Agreement which is for the
account of the other party hereto, it shall receive the same for the account of
such other party to the extent of such other party's interest therein and shall
promptly pay the same to such other party.
[SECTION 4. Consent of the Company, NNI and the Agent. This Agreement
is conditioned upon the consent of the Company, NNI and the Agent pursuant to
Section 10.06(c) of the Credit Agreement. The execution of this Agreement by the
Company, NNI and the Agent is evidence of this consent. Pursuant to Section
10.06(c), NNI agrees to execute and deliver a Note payable to the order of the
Assignee to evidence the assignment and assumption provided for herein.]
--------
(1) Use second variation if Commitments have terminated.
57
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of NNI or the
Company, or the validity and enforceability of the obligations of NNI or the
Company in respect of the Credit Agreement or any Note. The Assignee
acknowledges that it has, independently and without reliance on the Assignor,
and based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement and will
continue to be responsible for making its own independent appraisal of the
business, affairs and financial condition of NNI and the Company.
SECTION 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
[NAME OF ASSIGNOR]
By
----------------------------
Name:
Title:
[NAME OF ASSIGNEE]
By
----------------------------
Name:
Title:
[NORTEL NETWORKS CORPORATION
By
----------------------------
Name:
Title:
By
----------------------------
Name:
Title:
NORTEL NETWORKS INC.
By
----------------------------
Name:
Title:
▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK, as
Administrative Agent
By
----------------------------
Name:
Title: ](2)
--------
(2) omit if consents not required