364-DAY COMPETITIVE ADVANCE AND REVOLVING CREDIT AGREEMENT (the
"Agreement"), dated as of March 4, 1997, among PHH CORPORATION, a Maryland
corporation (the "Borrower"), PHH VEHICLE MANAGEMENT SERVICES INC., a
corporation incorporated under the Canada Business Corporations Act (the
"Canadian Borrower"), the Lenders referred to herein, CHASE SECURITIES INC., as
arranger (the "Arranger") for the Lenders, THE CHASE MANHATTAN BANK, a New York
banking corporation, as agent (the "Administrative Agent") for the US Lenders,
and The Chase Manhattan Bank of Canada, a Canadian chartered bank, as
administrative agent for the Canadian Lenders (in such capacity, the "Canadian
Agent").
INTRODUCTORY STATEMENT
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The Borrower has requested that the Lenders establish a $1,250,000,000
committed revolving credit facility pursuant to which Revolving Credit Loans may
be made to the Borrowers (as defined below). In addition, the Borrower has
requested that the Lenders provide (i) a procedure pursuant to which Lenders may
bid on an uncommitted basis on short-term borrowings by the Borrower and (ii) a
multi-currency credit facility in an amount equal to $500,000,000, of which up
to the equivalent of $200,000,000 will be made available by the Canadian Lenders
(as defined below) to the Canadian Borrower as a separate Canadian Dollar
tranche to be guaranteed by the Borrower.
Subject to the terms and conditions set forth herein, the
Administrative Agent is willing to act as agent for the Lenders, the Canadian
Agent is willing to act as agent for the Canadian Lenders and each Lender is
willing to make Loans.
Accordingly, the parties hereto hereby agree as follows:
1. DEFINITIONS
For the purposes hereof unless the context otherwise requires, the
following terms shall have the meanings indicated, all accounting terms not
otherwise defined herein shall have the respective meanings accorded to them
under GAAP and all terms defined in the New York Uniform Commercial Code and not
otherwise defined herein shall have the respective meanings accorded to them
therein:
"ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.
"ABR Loan" shall mean any Revolving Credit Loan bearing
interest at a rate determined by reference to the Alternate Base Rate
in accordance with the provisions of Article 2.
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"Acceptance Fee" shall mean a fee payable in C$ by the
Canadian Borrower to a Canadian Lender with respect to the acceptance
of a B/A, calculated on the face amount of the B/A at the rate per
annum equal to the B/A Spread on the basis of the number of days in the
applicable Contract Period and a year of 365 days.
"Acquisition" shall mean the acquisition by HFS Incorporated
("HFS") of all of the voting common stock of the Borrower pursuant to
the Agreement dated as of November 10, 1996 between HFS, the Borrower
and Mercury Acq. Corp.
"Affiliate" shall mean any Person which, directly or
indirectly, is in control of, is controlled by, or is under common
control with, the Borrower. For purposes of this definition, a Person
shall be deemed to be "controlled by" another if such latter Person
possesses, directly or indirectly, power either to (i) vote 10% or more
of the securities having ordinary voting power for the election of
directors of such controlled Person or (ii) direct or cause the
direction of the management and policies of such controlled Person
whether by contract or otherwise.
"Agents" shall mean, collectively, the Administrative Agent
and the Canadian Agent.
"Alternate Base Rate" shall mean for any day, a rate per annum
(rounded upwards to the nearest 1/16 of 1% if not already an integral
multiple of 1/16 of 1%) equal to the greater of (a) the Prime Rate in
effect for such day and (b) the Federal Funds Effective Rate in effect
for such day plus 1/2 of 1%. "Prime Rate" shall mean the rate per annum
publicly announced by the entity which is the Administrative Agent from
time to time as its prime rate in effect at its principal office in New
York City. For purposes of this Agreement, any change in the Alternate
Base Rate due to a change in the Prime Rate shall be effective on the
date such change in the Prime Rate is announced as effective. "Federal
Funds Effective Rate" shall mean, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for
the day of such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by it. If
for any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is
unable to ascertain the Federal Funds Effective Rate, for any reason,
including, without limitation, the inability or failure of the
Administrative Agent to obtain sufficient bids or publications in
accordance with the terms hereof, the Alternate Base Rate shall be
determined without regard to clause (b) until the circumstances giving
rise to such inability no longer exist. Any change in the Alternate
Base Rate due to a change in the
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Federal Funds Effective Rate shall be effective on the effective date
of such change in the Federal Funds Effective Rate.
"Applicable Agent" shall mean, (i) with respect to US Loans or
the Borrower, the Administrative Agent, and (ii) with respect to
Canadian Loans or the Canadian Borrower, the Canadian Agent.
"Applicable Borrower" shall mean (i) with respect to US Loans,
the Borrower, and (ii) with respect to Canadian Loans, the Canadian
Borrower.
"Applicable Law" shall mean all provisions of statutes, rules,
regulations and orders of governmental bodies or regulatory agencies
applicable to a Person, and all orders and decrees of all courts and
arbitrators in proceedings or actions in which the Person in question
is a party.
"Assessment Rate" shall mean, for any day, the net annual
assessment rate (rounded upwards, if necessary, to the next higher
Basis Point) as most recently reasonably estimated by the
Administrative Agent for determining the then current annual assessment
payable by the entity which is the Administrative Agent to the Federal
Deposit Insurance Corporation (or any successor) for insurance by such
Corporation (or such successor) of time deposits made in Dollars at
such entity's domestic offices.
"Assignment and Acceptance" shall mean an agreement in the
form of Exhibit C hereto, executed by the assignor, assignee and the
other parties as contemplated thereby.
"Available Foreign Currencies" shall mean the currencies set
forth on Schedule 1.1B, and any other available and freely-convertible
non-Dollar currency selected by the Borrower and approved (which
approval shall not be unreasonably withheld) in writing by the
Administrative Agent.
"Bankers' Acceptance" and "B/A" shall mean a ▇▇▇▇ of exchange
denominated in C$, drawn by the Canadian Borrower and accepted by a
Canadian Lender or a Participant in accordance with this Agreement.
"B/A Borrowing" shall mean a Borrowing comprised of Bankers'
Acceptances.
"B/A Spread" shall mean, at any date or for any period of
determination, the B/A Spread that would be in effect on such date or
during such period pursuant to the table set forth in Section 2.22
based on the rating of the Borrower's senior unsecured long-term debt.
"Basis Point" shall mean 1/100th of 1%.
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"Board" shall mean the Board of Governors of the Federal
Reserve System.
"Borrowers" shall mean, collectively, the Borrower and the
Canadian Borrower.
"Borrowing" shall mean a group of Loans of a single Interest
Rate Type made by certain Lenders (or in the case of a Competitive
Borrowing, by the Lender or Lenders whose Competitive Bids have been
accepted pursuant to Section 2.4) on a single date and as to which a
single Interest Period is in effect.
"Borrowing Date" shall mean any Business Day specified in a
notice pursuant to Section 2.5(b) as a date on which the Canadian
Borrower requests the Canadian Lenders to make Canadian Revolving
Credit Loans hereunder.
"Branch of Account" shall mean, for each Canadian Lender, the
branch or office of such Canadian Lender at the address set out
opposite that Canadian Lender's name or such other branch or office as
such Canadian Lender may advise the Canadian Borrower and the Canadian
Agent in writing.
"Business Day" shall mean, (i) with respect to any Loan other
than a Canadian Loan, any day other than a Saturday, Sunday or other
day on which banks in the State of New York are permitted or required
by law to close; provided that when used in connection with a LIBOR
Loan, the term "Business Day" shall also exclude any day on which banks
are not open for dealings in deposits in Dollars or the applicable
Available Foreign Currency on the London Interbank Market (or such
other interbank eurocurrency market where the foreign currency and
exchange operations in respect of Dollars or the applicable Available
Foreign Currency, as the case may be, are then being conducted for
delivery on the first day of such Interest Period) and (ii) with
respect to any Canadian Loan, any day other than a Saturday, Sunday or
other day on which banks in Toronto, Ontario or New York City are
permitted or required by law to close.
"C$ Prime Rate" shall mean, on any day, the annual rate of
interest (rounded upwards, if necessary, to the next 1/16 of 1%) equal
to the greater of:
(a) the annual rate of interest determined by The Bank of
Nova Scotia as the annual rates of interest announced
from time to time by The Bank of Nova Scotia as its
prime rate in effect at its principal office in
Toronto on such day for determining interest rates on
C$ denominated commercial loans in Canada; and
(b) the annual rate of interest equal to the sum of (A)
the CDOR Rate in effect on such day and (B) 1%.
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"C$ Prime Rate Borrowing" shall mean a Borrowing comprised of
C$ Prime Rate Loans.
"C$ Prime Rate Loan" shall mean a Canadian Revolving Credit
Loan denominated in C$ which bears interest at a rate based upon the C$
Prime Rate.
"Canadian Agent" shall have the meaning assigned to such term
in the preamble hereto.
"Canadian Borrower" shall have the meaning assigned to such
term in the preamble hereto.
"Canadian Borrowing" shall mean a Borrowing consisting of
simultaneous Canadian Revolving Credit Loans from the Canadian Lenders.
"Canadian Commitment" shall mean, with respect to each Lender,
the commitment of such Lender to make Canadian Revolving Credit Loans
to the Canadian Borrower pursuant to Section 2.1(b), in an aggregate
amount not to exceed at any time the amount set forth opposite such
Lender's name under the heading "Canadian Commitment" on or in (i)
Schedule 1.1A hereto, (ii) any applicable Assignment and Acceptance to
which it may be a party, and/or (iii) any agreement delivered pursuant
to Section 2.24(d), as the case may be, as such Lender's Canadian
Commitment may be permanently terminated or reduced from time to time
pursuant to Section 2.12 or 2.24 or Article 7 or changed pursuant to
Section 9.3. The Canadian Commitments shall automatically and
permanently terminate on the earlier of (a) the Maturity Date or (b)
the date of termination in whole pursuant to Section 2.12 or Article 7.
"Canadian Dollars" and "C$" shall mean the lawful currency of
Canada.
"Canadian Lender" shall mean each Lender which has a Canadian
Commitment or which has extended a Canadian Loan.
"Canadian Loan" shall mean any loan made by any Canadian
Lender pursuant to this Agreement to the Canadian Borrower.
"Canadian Obligations" shall mean the obligation of the
Canadian Borrower to make due and punctual payment of principal of, and
interest on (including post-petition interest, whether or not allowed),
the Canadian Loans and all other monetary obligations of the Canadian
Borrower to the Canadian Agent or any Canadian Lender under this
Agreement, the Canadian Revolving Credit Notes or with respect to any
Interest Rate Protection Agreement entered into between the Canadian
Borrower or any of its Subsidiaries and any Canadian Lender.
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"Canadian Revolving Credit Loan" shall have the meaning
assigned to such term in Section 2.1(b).
"Canadian Revolving Credit Note" shall have the meaning
assigned to such term in Section 2.8.
"Capital Lease" shall mean as applied to any Person, any lease
of any property (whether real, personal or mixed) by that Person as
lessee which, in accordance with GAAP, is or should be accounted for as
a capital lease on the balance sheet of that Person.
"Cash Equivalents" shall mean (i) investments in commercial
paper maturing in not more than 270 days from the date of issuance
which at the time of acquisition is rated at least A-1 or the
equivalent thereof by S&P, or P-1 or the equivalent thereof by ▇▇▇▇▇'▇,
(ii) investments in direct obligations or obligations which are
guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States is pledged in support thereof) having a maturity of not
more than three years from the date of acquisition, (iii) investments
in certificates of deposit maturing not more than one year from the
date of origin issued by a bank or trust company organized or licensed
under the laws of the United States or any state or territory thereof
having capital, surplus and undivided profits aggregating at least
$500,000,000 and A rated or better by S&P or ▇▇▇▇▇'▇, (iv) money market
mutual funds having assets in excess of $2,000,000,000, (v) investments
in asset-backed or mortgage-backed securities, including investments in
collateralized, adjustable rate mortgage securities and those
mortgage-backed securities which are rated at least AA by S&P or Aa by
▇▇▇▇▇'▇ or are of comparable quality at the time of investment, and
(vi) banker's acceptances maturing not more than one year from the date
of origin issued by a bank or trust company organized or licensed under
the laws of the United States or any state or territory thereof and
having a capital, surplus and undivided profits aggregating at least
$500,000,000, and rated A or better by S&P or ▇▇▇▇▇'▇.
"CDOR Rate" shall mean, on any date, the annual rate of
interest which is the rate based on an average rate applicable to C$
bankers' acceptances for a term of 30 days (in the case of the
definition of "C$ Prime Rate") appearing on the "Reuters Screen CDOR
Page" (as defined in the International Swaps and Derivatives
Association, Inc. definitions, as modified and amended from time to
time) at approximately 10:00 a.m. (Toronto time), on such date, or if
such date is not a Business Day, then on the immediately preceding
Business Day; provided, that if such rate does not appear on the
Reuters Screen CDOR Page as contemplated, then the CDOR Rate on any
date shall be calculated as the arithmetic mean of the rates for the
term referred to above applicable to C$ bankers' acceptances quoted by
The Bank of Nova Scotia as of 10:00 a.m. (Toronto time), on such date,
or if such date is not a Business Day, then on the immediately
preceding Business Day.
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"Change in Control" shall mean, (i) the acquisition by any
Person or group (within the meaning of the Securities Exchange Act of
1934, as amended, and the rules of the Securities and Exchange
Commission thereunder as in effect on the date hereof), directly or
indirectly, beneficially or of record, of ownership or control of in
excess of 50% of the voting common stock of HFS Incorporated on a fully
diluted basis at any time or (ii) at any time, individuals who at the
date hereof constituted the Board of Directors of HFS Incorporated
(together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of HFS
Incorporated, as the case may be, was approved by a vote of the
majority of the directors then still in office who were either
directors at the date hereof or whose election or a nomination for
election was previously so approved) cease for any reason to constitute
a majority of the Board of Directors of HFS Incorporated then in office
or (iii) HFS Incorporated shall cease to own, directly or through
wholly-owned Subsidiaries, all of the capital stock of the Borrower,
free and clear of any direct or indirect Liens.
"Chase" shall mean The Chase Manhattan Bank, a New York
banking corporation.
"Chase Canada" shall mean The Chase Manhattan Bank of Canada,
a Canadian chartered bank.
"Closing Date" shall mean the date on which the conditions
precedent to the effectiveness of this Agreement as set forth in
Section 4.1 have been satisfied or waived, which shall in no event be
later than April 15, 1997.
"Code" shall mean the Internal Revenue Code of 1986 and the
rules and regulations issued thereunder, as now and hereafter in
effect, or any successor provision thereto.
"Commitment" shall mean, (i) with respect to each Primary
Lender, its Primary Commitment, (ii) with respect to each Pounds
Sterling Lender, its Pounds Sterling Commitment and (iii) with respect
to each Canadian Lender, its Canadian Commitment.
"Commitment Expiration Date" shall have the meaning assigned
to such term in Section 2.24(a).
"Commitment Period" shall mean the period from and including
the Closing Date to but not including the Maturity Date or such earlier
date on which the Commitments shall have been terminated in accordance
with the terms hereof.
"Competitive Bid" shall mean an offer by a Lender to make a
Competitive Loan pursuant to Section 2.4 in the form of Exhibit E-3.
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"Competitive Bid Accept/Reject Letter" shall mean a
notification made by the Borrower pursuant to Section 2.4(d) in the
form of Exhibit E-4.
"Competitive Bid Rate" shall mean, as to any Competitive Bid
made by a Lender pursuant to Section 2.4(b), (a) in the case of a LIBOR
Loan, the Margin and (b) in the case of a Fixed Rate Loan, the fixed
rate of interest offered by the Lender making such Competitive Bid.
"Competitive Bid Request" shall mean a request made pursuant
to Section 2.4 in the form of Exhibit E-1.
"Competitive Borrowing" shall mean a Borrowing consisting of a
Competitive Loan or concurrent Competitive Loans from the Lender or
Lenders whose Competitive Bids for such Borrowing have been accepted by
the Borrower under the bidding procedure described in Section 2.4.
"Competitive Loan" shall mean a Loan from a Lender to the
Borrower pursuant to the bidding procedure described in Section 2.4.
Each Competitive Loan shall be a LIBOR Competitive Loan or a Fixed Rate
Loan.
"Competitive Note" shall have the meaning assigned to such
term in Section 2.8.
"Consolidated Assets" shall mean, at any date of
determination, the total assets of the Borrower and its Consolidated
Subsidiaries determined in accordance with GAAP.
"Consolidated Net Income" shall mean, for any period for which
such amount is being determined, the net income (loss) of the Borrower
and its Consolidated Subsidiaries during such period determined on a
consolidated basis for such period taken as a single accounting period
in accordance with GAAP, provided that there shall be excluded (i)
income (or loss) of any Person (other than a Consolidated Subsidiary)
in which the Borrower or any of its Consolidated Subsidiaries has an
equity investment or comparable interest, except to the extent of the
amount of dividends or other distributions actually paid to the
Borrower or its Consolidated Subsidiaries by such Person during such
period, (ii) the income (or loss) of any Person accrued prior to the
date it becomes a Consolidated Subsidiary or is merged into or
consolidated with the Borrower or any of its Consolidated Subsidiaries
or the Person's assets are acquired by the Borrower or any of its
Consolidated Subsidiaries, (iii) the income of any Consolidated
Subsidiary to the extent that the declaration or payment of dividends
or similar distributions by that Consolidated Subsidiary of the income
is not at the time permitted by operation of the terms of its charter
or any agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Consolidated Subsidiary,
(iv) any extraordinary after-tax gains and (v) any extraordinary pretax
losses but only to the extent attributable to a write-down of financing
costs relating to any existing and future indebtedness.
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"Consolidated Net Worth" shall mean, at any date of
determination, all amounts which would be included on a balance sheet
of the Borrower and its Consolidated Subsidiaries under stockholders'
equity as of such date in accordance with GAAP.
"Consolidated Subsidiaries" shall mean all Subsidiaries of the
Borrower that are required to be consolidated with the Borrower for
financial reporting purposes in accordance with GAAP.
"Contract Period" shall mean the term of a B/A selected by the
Canadian Borrower in accordance with Section 2.25 commencing on the
Borrowing Date, Rollover Date or date of refinancing pursuant to
Section 2.6, as applicable, of such B/A and expiring on a Business Day
which shall be either 30 days, 60 days, 90 days, 120 days or 180 days
thereafter, provided that no Contract Period shall extend beyond the
Maturity Date.
"Contractual Obligation" shall mean, as to any Person, any
provision of any security issued by such Person or of any agreement,
instrument or other undertaking to which such Person is a party or by
which it or any of its property is bound.
"Currency" or "Currencies" shall mean the collective reference
to Dollars and Available Foreign Currencies.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Discount Proceeds" shall mean, for any B/A, an amount
(rounded to the nearest whole cent, and with one-half of one cent being
rounded up) calculated on the applicable Borrowing Date or Rollover
Date by multiplying:
(i) the face amount of the B/A; by
(ii) the quotient of one divided by the sum of
one plus the product of:
1. the Discount Rate (expressed as a decimal) applicable
to such B/A, and
2. a fraction, the numerator of which is the Contract
Period of the B/A and the denominator of which is
365, being the number of days in the applicable year,
with such quotient being rounded up or down to the fifth decimal place
and .000005 being rounded up.
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"Discount Rate" shall mean, with respect to any Canadian
Lender, as applicable to a B/A being purchased by such Canadian Lender
on any day, the average (as determined by the Canadian Agent) of the
respective percentage discount rates (expressed to two decimal places
and rounded upward, if necessary, to the nearest 0.01%) quoted to The
Bank of Nova Scotia as the percentage discount rate at which The Bank
of Nova Scotia would, in accordance with its normal practices, at or
about 10:00 a.m., Toronto time, on such day, be prepared to purchase
Bankers' Acceptances accepted by The Bank of Nova Scotia having a face
amount and term comparable to the face amount and term of such B/A.
"Dollar Equivalent Amount" shall mean with respect to (i) any
amount of any Available Foreign Currency on any date, the equivalent
amount in Dollars of such amount of Available Foreign Currency, as
determined by the Administrative Agent using the applicable Exchange
Rate and (ii) any amount in Dollars, such amount.
"Dollars" and "$" and "US$" shall mean lawful currency of the
United States.
"Domestic Obligations" shall mean the obligation of the
Borrower to make due and punctual payment of principal of, and interest
on (including post-petition interest, whether or not allowed), the
Loans, the Facility Fee, guarantee obligations in respect of the
Canadian Obligations and all other monetary obligations of the Borrower
to the Administrative Agent or any Lender under this Agreement, the
Notes or the Fundamental Documents or with respect to any Interest Rate
Protection Agreements entered into between the Borrower or any of its
Subsidiaries and any Lender.
"Environmental Laws" shall mean any and all federal,
provincial, state, local or municipal laws, rules, orders, regulations,
statutes, ordinances, codes, decrees or requirements of any
Governmental Authority regulating, relating to or imposing liability or
standards of conduct concerning, any Hazardous Material or
environmental protection or health and safety, as now or at any time
hereafter in effect, including without limitation, the Clean Water Act
also known as the Federal Water Pollution Control Act, 33 U.S.C. ▇▇.▇▇.
1251 et seq., the Clean Air Act, 42 U.S.C. ▇▇.▇▇. 7401 et seq., the
Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. ▇▇.▇▇. 136
et seq., the Surface Mining Control and Reclamation Act, 30 U.S.C.
▇▇.▇▇. 1201 et seq., the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. ▇▇.▇▇. 9601 et seq., the
Superfund Amendment and Reauthorization Act of 1986, Public Law 99-499,
100 Stat. 1613, the Emergency Planning and Community Right to Know Act,
42 U.S.C. ▇▇.▇▇. 11001 et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. ▇▇.▇▇. 6901 et seq., the Occupational Safety and Health
Act as amended, 29 U.S.C. ss. 655 and ss. 657, together, in each case,
with any amendment thereto, and the regulations adopted and
publications promulgated thereunder and all substitutions thereof.
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"Environmental Liabilities" shall mean any liability,
contingent or otherwise (including any liability for damages, costs of
environmental remediation, fines, penaltiesor indemnities), of the
Borrower or any Subsidiary directly or indirectly resulting from or
based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal of any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the
release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as such Act may be amended, and the regulations promulgated
thereunder.
"Event of Default" shall have the meaning given such term in
Article 7.
"Exchange Rate" shall mean, (i) with respect to any Available
Foreign Currency other than Canadian Dollars on any date, the rate at
which such Available Foreign Currency may be exchanged into Dollars, as
set forth on such date on the relevant Reuters currency page at or
about 11:00 A.M. New York City time on such date and (ii) with respect
to Canadian Dollars, the spot rate at which Canadian Dollars may be
exchanged into U.S. Dollars, as quoted by The Bank of Canada at
approximately 12:00 noon, Toronto time, as set forth on the Reuters
"BOFC" page. In the event that such rate does not appear on any such
Reuters page, the "Exchange Rate" with respect to such Available
Foreign Currency shall be determined by reference to such other
publicly available service for displaying exchange rates as may be
agreed upon by the Administrative Agent and the Borrower or, in the
absence of such agreement, such "Exchange Rate" shall instead be the
Administrative Agent's spot rate of exchange in the interbank market
where its foreign currency exchange operations in respect of such
Available Foreign Currency are then being conducted, at or about 10:00
A.M., local time, at such date for the purchase of Dollars with such
Available Foreign Currency, for delivery two Business Days later;
provided that if at the time of any such determination, no such spot
rate can reasonably be quoted, the Administrative Agent may use any
reasonable method (including obtaining quotes from three or more market
makers for such Available Foreign Currency) as it deems applicable to
determine such rate, and such determination shall be conclusive absent
manifest error (without prejudice to the determination of the
reasonableness of such method).
"Extension Request" means each request by the Borrower made
pursuant to Section 2.24 for the Lenders to extend the Maturity Date,
which shall contain the information in respect of such extension
specified in Exhibit G and shall be delivered to the Administrative
Agent in writing.
"Facility Fee" shall have the meaning given such term in
Section 2.7.
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"Five Year Credit Agreement" shall mean the Five Year
Competitive Advance and Revolving Credit Agreement, dated as of the
date hereof, among the Borrower, the lenders referred to therein, and
Chase, as Administrative Agent.
"Fixed Rate Borrowing" shall mean a Borrowing comprised of
Fixed Rate Loans.
"Fixed Rate Loan" shall mean any Competitive Loan bearing
interest at a fixed percentage rate per annum (expressed in the form of
a decimal to no more than four decimal places) specified by the Lender
making such Loan in its Competitive Bid.
"Fundamental Documents" shall mean this Agreement, any
Revolving Credit Notes, any Competitive Notes, any Canadian Revolving
Credit Notes, any Pounds Sterling Notes and any other ancillary
documentation which is required to be, or is otherwise, executed by the
Borrowers and delivered to the Administrative Agent in connection with
this Agreement.
"GAAP" shall mean generally accepted accounting principles
consistently applied (except for accounting changes in response to FASB
releases or other authoritative pronouncements) provided, however, that
all calculations made pursuant to Sections 6.7 and 6.8 and the related
definitions shall have been computed based on such generally accepted
accounting principles as are in effect on the date hereof.
"Governmental Authority" shall mean any federal, provincial,
state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, or any court, in each case, whether
of the United States or Canada or foreign.
"Guaranty" shall mean, as to any Person, any direct or
indirect obligation of such Person guaranteeing or intended to
guarantee any Indebtedness, Capital Lease, dividend or other monetary
obligation ("primary obligation") of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not
contingent, (a) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (b) to advance or
supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of
the primary obligor, (c) to purchase property, securities or services,
in each case, primarily for the purpose of assuring the owner of any
such primary obligation of the repayment of such primary obligation or
(d) as a general partner of a partnership or a joint venturer of a
joint venture in respect of indebtedness of such partnership or such
joint venture which is treated as a general partnership for purposes of
Applicable Law. The amount of any Guaranty shall be deemed to be an
amount equal to the stated or determinable amount (or portion thereof)
of the primary obligation in respect of which such Guaranty is made or,
if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to
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perform thereunder); provided that the amount of any Guaranty shall be
limited to the extent necessary so that such amount does not exceed the
value of the assets of such Person (as reflected on a consolidated
balance sheet of such Person prepared in accordance with GAAP) to which
any creditor or beneficiary of such Guaranty would have recourse.
Notwithstanding the foregoing definition, the term "Guaranty" shall not
include any direct or indirect obligation of a Person as a general
partner of a general partnership or a joint venturer of a joint venture
in respect of Indebtedness of such general partnership or joint
venture, to the extent such Indebtedness is contractually non-recourse
to the assets of such Person as a general partner or joint venturer
(other than assets comprising the capital of such general partnership
or joint venture).
"Hazardous Materials" shall mean any flammable materials,
explosives, radioactive materials, hazardous materials, hazardous
wastes, hazardous or toxic substances, or similar materials defined as
such in any Environmental Law.
"Indebtedness" shall mean (i) all indebtedness, obligations
and other liabilities of the Borrower and its Subsidiaries which are,
at the date as of which Indebtedness is to be determined, includable as
liabilities in a consolidated balance sheet of the Borrower and its
Subsidiaries, other than (x) accounts payable and accrued expenses, (y)
advances from clients obtained in the ordinary course of the relocation
management services business of the Borrower and its Subsidiaries and
(z) current and deferred income taxes and other similar liabilities,
plus (ii) without duplicating any items included in Indebtedness
pursuant to the foregoing clause (i), the maximum aggregate amount of
all liabilities of the Borrower or any of its Subsidiaries under any
Guaranty, indemnity or similar undertaking given or assumed of, or in
respect of, the indebtedness, obligations or other liabilities, assets,
revenues, income or dividends of any Person other than the Borrower or
one of its Subsidiaries and (iii) all other obligations or liabilities
of the Borrower or any of its Subsidiaries in relation to the discharge
of the obligations of any Person other than the Borrower or one of it
Subsidiaries.
"Interest Payment Date" shall mean, with respect to any
Borrowing, the last day of the Interest Period applicable thereto and,
in the case of a LIBOR Borrowing with an Interest Period of more than
three months' duration or a Fixed Rate Borrowing with an Interest
Period of more than 90 days' duration, each day that would have been an
Interest Payment Date had successive Interest Periods of three months'
duration or 90 days' duration, as the case may be, been applicable to
such Borrowing, and, in addition, the date of any refinancing or
conversion of a Borrowing with, or to, a Borrowing of a different
Interest Rate Type.
"Interest Period" shall mean (a) as to any LIBOR Borrowing,
the period commencing on the date of such Borrowing, and ending on the
numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2,
3, 6 or, subject to each Lender's approval, 12 months
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thereafter, as the Borrower may elect, (b) as to any ABR Borrowing, the
period commencing on the date of such Borrowing and ending on the
earliest of (i) the next succeeding March 31, June 30, September 30 or
December 31, commencing ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) the Maturity Date and
(iii) the date such Borrowing is refinanced with a Borrowing of a
different Interest Rate Type in accordance with Section 2.6 or is
prepaid in accordance with Section 2.13, (c) as to any C$ Prime Rate
Loan, the period commencing on the date of such Borrowing and ending on
the earliest of (i) the last Business Day of the calendar month, (ii)
the Maturity Date and (iii) the date such Borrowing is refinanced with
a Borrowing of a different Interest Rate Type in accordance with
Section 2.6 or is prepaid in accordance with Section 2.13, and (d) as
to any Fixed Rate Borrowing, the period commencing on the date of such
Borrowing and ending on the date specified in the Competitive Bids in
which the offer to make the Fixed Rate Loans comprising such Borrowing
were extended, which shall not be earlier than seven days after the
date of such Borrowing or later than 360 days after the date of such
Borrowing; provided that with respect to Loans made by an Objecting
Lender, no Interest Period with respect to such Objecting Lender's
Loans shall end after such Objecting Lender's Commitment Expiration
Date; and provided, further, that (i) if any Interest Period would end
on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, in the case of
LIBOR Loans only, such next succeeding Business Day would fall in the
next calendar month, in which case such Interest Period shall end on
the next preceding Business Day and (ii) no Interest Period with
respect to any LIBOR Borrowing or Fixed Rate Borrowing may be selected
which would result in the aggregate amount of LIBOR Loans and Fixed
Rate Loans having Interest Periods ending after any day on which a
Commitment reduction is scheduled to occur being in excess of the Total
Commitment scheduled to be in effect after such date. Interest shall
accrue from, and including, the first day of an Interest Period to, but
excluding, the last day of such Interest Period.
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement or other similar
financial agreement or arrangement.
"Interest Rate Type" when used in respect of any Loan or
Borrowing, shall refer to the Rate by reference to which interest on
such Loan or on the Loans comprising such Borrowing is determined. For
purposes of US Loans, "Rate" shall include LIBOR, the Alternate Base
Rate and the Fixed Rate, and for purposes of Canadian Revolving Credit
Loans, shall include the C$ Prime Rate and the rate implicit in the
Discount Rate.
"Lender and "Lenders" shall mean the financial institutions
whose names appear at the foot hereof and any assignee of a Lender
pursuant to Section 9.3(b).
"Lending Office" shall mean, with respect to any of the
Lenders, the branch or branches (or affiliate or affiliates) from which
any such Lender's LIBOR Loans, Fixed
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Rate Loans or ABR Loans or C$ Prime Rate Loans or Bankers' Acceptances,
as the case may be, are made or maintained and for the account of which
all payments of principal of, and interest on, such Lender's LIBOR
Loans, Fixed Rate Loans or ABR Loans or C$ Prime Rate Loans or Bankers'
Acceptances are made, as notified to the Administrative Agent and the
Canadian Agent from time to time.
"LIBOR" shall mean, with respect to any LIBOR Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next Basis Point) equal to the rate at which deposits
in Dollars or the applicable Available Foreign Currency, as the case
may be, approximately equal in principal amount to (a) in the case of a
Revolving Credit Borrowing, Chase's portion of such LIBOR Borrowing and
(b) in the case of a Competitive Borrowing, a principal amount that
would have been Chase's portion of such Competitive Borrowing had such
Competitive Borrowing been a Revolving Credit Borrowing, and for a
maturity comparable to such Interest Period, are offered to the
principal London office of Chase in immediately available funds in the
London Interbank Market (or such other interbank eurocurrency market
where the foreign currency and exchange operations in respect of
Dollars or such applicable Available Foreign Currency, as the case may
be, are then being conducted for delivery on the first day of such
Interest Period) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period (or, in the case
of U.K. Pounds Sterling, on the first day of such Interest Period).
"LIBOR Borrowing" shall mean a Borrowing comprised of LIBOR
Loans.
"LIBOR Competitive Loan" shall mean any Competitive Loan
bearing interest at a rate determined by reference to LIBOR in
accordance with the provisions of Article 2.
"LIBOR Loan" shall mean any LIBOR Competitive Loan or LIBOR
Revolving Credit Loan.
"LIBOR Revolving Credit Loan" shall mean any Loan (other than
a Competitive Loan) bearing interest at a rate determined by reference
to LIBOR in accordance with the provisions of Article 2.
"LIBOR Spread" shall mean, at any date or any period of
determination, the LIBOR Spread that would be in effect on such date or
during such period pursuant to the chart set forth in Section 2.22
based on the rating of the Borrower's senior unsecured long-term debt.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including any
conditional sale or other title retention agreement, any lease in the
nature thereof or agreement to give any financing statement under the
Uniform Commercial Code of any jurisdiction).
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"Loan" shall mean a Competitive Loan or a Revolving Credit
Loan, whether made as a LIBOR Loan, an ABR Loan or a Fixed Rate Loan,
as permitted hereby, or a Canadian Revolving Credit Loan, whether made
as a C$ Prime Rate Loan or a B/A, as permitted hereby.
"Margin" shall mean, as to any LIBOR Competitive Loan, the
margin (expressed as a percentage rate per annum in the form of a
decimal to four decimal places) to be added to, or subtracted from,
LIBOR in order to determine the interest rate applicable to such Loan,
as specified in the Competitive Bid relating to such Loan.
"Margin Stock" shall be as defined in Regulation U of the
Board.
"Material Adverse Effect" shall mean a material adverse effect
on the business, assets, operations or condition, financial or
otherwise, of the Borrower and its Subsidiaries taken as a whole.
"Material Subsidiary" shall mean any Subsidiary of the
Borrower which together with its Subsidiaries at the time of
determination had assets constituting 10% or more of Consolidated
Assets, accounts for 10% or more of Consolidated Net Worth, or accounts
for 10% or more of the revenues of the Borrower and its Consolidated
Subsidiaries for the Rolling Period immediately preceding the date of
determination.
"Maturity Date" shall mean 364 days from and including the
Closing Date or such later date as shall be determined pursuant to the
provisions of Section 2.24 with respect to non-Objecting Lenders.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service Inc.
"Multiemployer Plan" shall mean a plan described in Section
3(37) of ERISA.
"non-Objecting Lender" shall mean any Lender that is not an
Objecting Lender.
"Notes" shall mean the Competitive Notes and the Revolving
Credit Notes and the Canadian Revolving Credit Notes and the Pounds
Sterling Notes.
"Notice of Canadian Borrowing" shall have the meaning assigned
to such term in Section 2.5(b).
"Notice of Rollover" shall mean a written notice to the
Canadian Agent substantially in the form attached hereto as Exhibit J.
"Objecting Lender" shall mean any Lender that does not consent
to the extension of the Maturity Date pursuant to Section 2.24.
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"Obligations" shall mean the collective reference to the
Domestic Obligations and the Canadian Obligations.
"Participant" shall have the meaning assigned to such term in
Section 9.3(g).
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any successor thereto.
"Permitted Encumbrances" shall mean Liens permitted under
Section 6.5.
"Person" shall mean any natural person, corporation, division
of a corporation, partnership, limited liability company, trust, joint
venture, association, company, estate, unincorporated organization or
government or any agency or political subdivision thereof.
"Plan" shall mean an employee pension benefit plan described
in Section 3(2) of ERISA, other than a Multiemployer Plan.
"Pounds Sterling Borrowing" shall mean a Borrowing consisting
of simultaneous Pounds Sterling Loans from each of the Pounds Sterling
Lenders.
"Pounds Sterling Commitment" shall mean, with respect to each
Lender, its commitment to make Pounds Sterling Loans to the Borrower
pursuant to Section 2.1(c), in an aggregate Dollar Equivalent Amount
not to exceed at any time the amount set forth opposite such Lender's
name under the heading "Pounds Sterling Commitment" on or in (i)
Schedule 1.1A hereto, (ii) any applicable Assignment and Acceptance to
which it may be a party, and/or (iii) any agreement delivered pursuant
to Section 2.24(d), as the case may be, as such Lender's Pounds
Sterling Commitment may be permanently terminated or reduced from time
to time pursuant to Section 2.12 or 2.24 or Article 7 or changed
pursuant to Section 9.3. The Pounds Sterling Commitments shall
automatically and permanently terminate on the earlier of (a) the
Maturity Date or (b) the date of termination in whole pursuant to
Section 2.12 or Article 7.
"Pounds Sterling Lender" shall mean each Lender which has a
Pounds Sterling Commitment or which has extended a Pounds Sterling
Loan.
"Pounds Sterling Loan" shall have the meaning assigned to such
term in Section 2.1(c).
"Pounds Sterling Note" shall have the meaning assigned to such
term in Section 2.8.
"Primary Borrowing" shall mean a Borrowing consisting of
simultaneous Primary Loans from each of the Primary Lenders.
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"Primary Commitment" shall mean, with respect to each Lender,
its commitment to make Primary Loans to the Borrower pursuant to
Section 2.1(a), in an aggregate amount not to exceed at any time the
amount set forth opposite such Lender's name under the heading "Primary
Commitment" on or in (i) Schedule 1.1A hereto, (ii) any applicable
Assignment and Acceptance to which it may be a party, and/or (iii) any
agreement delivered pursuant to Section 2.24(d), as the case may be, as
such Lender's Primary Commitment may be permanently terminated or
reduced from time to time pursuant to Section 2.12 or 2.24 or Article 7
or changed pursuant to Section 9.3. The Primary Commitments shall
automatically and permanently terminate on the earlier of (a) the
Maturity Date or (b) the date of termination in whole pursuant to
Section 2.12 or Article 7.
"Primary Lender" shall mean each Lender which has a Primary
Commitment or which has extended a Primary Loan.
"Primary Loan" shall mean any Loan made by any Primary Lender
pursuant to Section 2.1(a).
"Pro Forma Balance Sheet" shall have the meaning assigned to
such term in Section 3.4.
"Pro Forma Basis" shall mean, in connection with any
transaction for which a determination on a Pro Forma Basis is required
to be made hereunder, that such determination shall be made (i) after
giving effect to any issuance of Indebtedness, any acquisition, any
disposition or any other transaction (as applicable) and (ii) assuming
that the issuance of Indebtedness, acquisition, disposition or other
transaction and, if applicable, the application of any proceeds
therefrom, occurred at the beginning of the most recent Rolling Period
ending at least thirty (30) days prior to the date on which such
issuance of Indebtedness, acquisition, disposition or other transaction
occurred.
"Reportable Event" shall mean any reportable event as defined
in Section 4043(c) of ERISA, other than a reportable event as to which
provision for 30-day notice to the PBGC would be waived under
applicable regulations had the regulations in effect on the Closing
Date been in effect on the date of occurrence of such reportable event.
"Required Lenders" shall mean at any time, Lenders holding
Commitments representing (in Dollar amounts) 51% or more of the Primary
Commitment, except that (i) for purposes of determining the Lenders
entitled to declare the principal of and the interest on the Loans and
the Notes and all other amounts payable hereunder or thereunder to be
forthwith due and payable pursuant to Article 7 and (ii) at all times
after the termination of the Total Commitment in its entirety,
"Required Lenders" shall mean
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Lenders holding 51% or more of the aggregate principal amount of the
Loans at the time outstanding.
"Revolving Credit Borrowing" shall mean a Borrowing consisting
of simultaneous Revolving Credit Loans from each of the Primary Lenders
or Pounds Sterling Lenders, as the case may be.
"Revolving Credit Borrowing Request" shall mean a request made
pursuant to Section 2.5 in the form of Exhibit F.
"Revolving Credit Loans" shall mean the Loans made by the
Primary or Pounds Sterling Lenders to the Borrower pursuant to a notice
given by the Borrower under Section 2.5(a). Each Revolving Credit Loan
shall be a LIBOR Revolving Credit Loan or an ABR Loan.
"Revolving Credit Note" shall have the meaning assigned to
such term in Section 2.8.
"Rolling Period" shall mean with respect to any fiscal
quarter, such fiscal quarter and the three immediately preceding fiscal
quarters considered as a single accounting period.
"Rollover Date" shall mean any Business Day specified in a
Notice of Rollover pursuant to Section 2.25 as the date of issue of a
B/A in respect of any maturing B/As.
"S&P" shall mean Standard & Poor's Ratings Services, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies.
"Special Purpose Vehicle Subsidiary" shall mean PHH Caribbean
Leasing, Inc. and any Subsidiary engaged in the fleet-leasing
management business which (i) is, at any one time, a party to one or
more lease agreements with only one lessee and (ii) finances, at any
one time, its investment in lease agreements or vehicles with only one
lender, which lender may be the Borrower if and to the extent that such
loans and/or advances by the Borrower are not prohibited hereby.
"Statutory Reserves" shall mean a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator
of which is the number one minus the aggregate of the maximum reserve
percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by the Board and any other
banking authority to which the Administrative Agent or any Lender is
subject, for Eurocurrency Liabilities (as defined in Regulation D of
the Board) (or, at any time when such Lender may be required by the
Board or by any other Governmental Authority, whether within the United
States or in another relevant jurisdiction, to
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maintain reserves against any other category of liabilities which
includes deposits by reference to which LIBOR is determined as provided
in this Agreement or against any category of extensions of credit or
other assets of such Lender which includes any such LIBOR Loans). Such
reserve percentages shall include those imposed under Regulation D of
the Board. LIBOR Loans shall be deemed to constitute Eurocurrency
Liabilities and as such shall be deemed to be subject to such reserve
requirements without benefit of or credit for proration, exceptions or
offsets which may be available from time to time to any Lender under
Regulation D of the Board. Statutory Reserves shall be adjusted
automatically on and as of the effective date of any change in any
reserve percentage.
"Subsidiary" shall mean with respect to any Person, any
corporation, association, joint venture, partnership or other business
entity (whether now existing or hereafter organized) of which at least
a majority of the voting stock or other ownership interests having
ordinary voting power for the election of directors (or the equivalent)
is, at the time as of which any determination is being made, owned or
controlled by such Person or one or more subsidiaries of such Person or
by such Person and one or more subsidiaries of such Person. Unless
otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.
"Supermajority Lenders" shall mean Lenders which have
Commitments representing at least 75% of the aggregate Dollar amount of
the Primary Commitments.
"Total Commitment" shall mean, at any time, the aggregate
amount of the Lenders' Commitments as in effect at such time.
"United States" shall mean the United States of America.
"US Lenders" shall mean the Lenders other than the Canadian
Lenders.
"US Loans" shall mean Loans other than Canadian Loans.
"Working Day" shall mean any Business Day on which dealings in
foreign currencies and exchange between banks may be carried on in
London, England and in New York, New York.
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2. THE LOANS
SECTION 2.1. Commitments
(a) Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, each Primary Lender agrees,
severally and not jointly, to make Revolving Credit Loans to the Borrower in
Dollars, at any time and from time to time on and after the Closing Date and
until the earlier of the Maturity Date and the termination of the Primary
Commitment of such Lender, in an aggregate principal amount at any time
outstanding not to exceed such Primary Lender's Primary Commitment minus the sum
of such Primary Lender's pro rata share of the aggregate principal Dollar
Equivalent Amount of the Pounds Sterling Loans and Canadian Loans made by such
Lender plus the outstanding Dollar Equivalent Amount by which the Competitive
Loans outstanding at such time shall be deemed to have used such Lender's
Commitment pursuant to Section 2.18, subject, however, to the condition that at
no time shall (i) the sum of (A) the outstanding aggregate principal amount of
all Revolving Credit Loans made by all Primary Lenders plus the outstanding
aggregate principal Dollar Equivalent Amount of all Competitive Loans, Pounds
Sterling Loans and Canadian Revolving Credit Loans made by the Lenders exceed
(ii) the Total Commitment. During the Commitment Period, the Borrower may use
the Primary Commitments of the Primary Lenders by borrowing, prepaying the
Primary Loans in whole or in part, and reborrowing, all in accordance with the
terms and conditions hereof.
(b) Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, each Canadian Lender agrees,
severally and not jointly, to make revolving credit loans (each, a "Canadian
Revolving Credit Loan") to the Canadian Borrower in Canadian Dollars, at any
time and from time to time on and after the Closing Date and until the earliest
of (i) the Maturity Date, (ii) such date on which the Borrower shall fail to
own, directly or indirectly, beneficially and of record, all of the capital
stock of the Canadian Borrower and (iii) the termination of the Canadian
Commitment of such Canadian Lender, in an aggregate principal amount at any time
outstanding not to exceed such Canadian Lender's Canadian Commitment minus the
sum of such Canadian Lender's pro rata share of the outstanding Dollar
Equivalent Amount by which the Competitive Loans outstanding at such time shall
be deemed to have used such Canadian Lender's Commitment pursuant to Section
2.18, subject, however, to the conditions that (a) at no time shall (i) the sum
of (A) the outstanding aggregate principal Dollar Equivalent Amount of all
Canadian Revolving Credit Loans made by all Canadian Lenders plus the
outstanding aggregate principal Dollar Equivalent Amount of all Primary Loans,
Pounds Sterling Loans and Competitive Loans made by the Lenders exceed (ii) the
Total Commitment and (b) at all times the outstanding aggregate principal amount
of all Canadian Revolving Credit Loans made by each Canadian Lender shall equal
the product of (i) the percentage that its Canadian Commitment represents of the
aggregate Canadian Commitment times (ii) the outstanding aggregate principal
amount of all Canadian Revolving Credit Loans. During the Commitment Period, the
Canadian Borrower may use the Canadian Commitments of
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the Canadian Lenders by borrowing, prepaying the Canadian Revolving Credit Loans
in whole or in part and reborrowing, all in accordance with the terms and
conditions hereof.
(c) Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, each Pounds Sterling Lender
agrees, severally and not jointly, to make revolving credit loans (each, a
"Pounds Sterling Loan") to the Borrower in U.K. Pounds Sterling, at any time and
from time to time on and after the Closing Date and until the earlier of the
Maturity Date and the termination of the Pounds Sterling Commitment of such
Pounds Sterling Lender, in an aggregate principal amount at any time outstanding
not to exceed such Pounds Sterling Lender's Pounds Sterling Commitment minus the
sum of such Pounds Sterling Lender's pro rata share of the outstanding Dollar
Equivalent Amount by which the Competitive Loans outstanding at such time shall
be deemed to have used such Pounds Sterling Lender's Commitment pursuant to
Section 2.18, subject, however, to the conditions that (a) at no time shall (i)
the sum of (A) the outstanding aggregate principal Dollar Equivalent Amount of
all Pounds Sterling Loans made by all Pounds Sterling Lenders plus the
outstanding aggregate principal Dollar Equivalent Amount of all Primary Loans,
Canadian Revolving Credit Loans and Competitive Loans made by the Lenders exceed
(ii) the Total Commitment and (b) at all times the outstanding aggregate
principal amount of all Pounds Sterling Loans made by each Pounds Sterling
Lender shall equal the product of (i) the percentage that its Pounds Sterling
Commitment represents of the aggregate Pounds Sterling Commitment times (ii) the
outstanding aggregate principal amount of all Pounds Sterling Loans. During the
Commitment Period, the Pounds Sterling Borrower may use the Pounds Sterling
Commitments of the Pounds Sterling Lenders by borrowing, prepaying the Pounds
Sterling Loans in whole or in part and reborrowing, all in accordance with the
terms and conditions hereof.
(d) The Commitments of the Lenders may be terminated or reduced from
time to time pursuant to Section 2.12 or Article 7.
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SECTION 2.2. Loans.
(a) Each Primary Loan, Pounds Sterling Loan or Canadian Revolving
Credit Loan, as the case may be, shall be made as part of a Borrowing from the
Primary Lenders, Pounds Sterling Lenders or the Canadian Lenders, as the case
may be, ratably in accordance with their respective applicable Commitments;
provided that the failure of any Primary Lender, Pounds Sterling Lender or
Canadian Lender, as the case may be, to make any Primary Loan, Pounds Sterling
Loan or Canadian Revolving Credit Loan, as the case may be, shall not in itself
relieve any other Primary Lender, Pounds Sterling Loan or Canadian Lender, as
the case may be, of its obligation to lend hereunder (it being understood,
however, that no Lender shall be responsible for the failure of any other Lender
to make any Loan required to be made by such other Lender); and provided,
further, that (I) each Pounds Sterling Loan made by a Pounds Sterling Lender
shall reduce the Primary Commitment and Canadian Commitment of such Lender by
the principal amount of such Pounds Sterling Loan and (II) each Canadian Loan
shall reduce the Primary Commitment and Pounds Sterling Commitment of such
Lender by the principal amount of such Canadian Loan. Each Competitive Loan
shall be made in accordance with the procedures set forth in Section 2.4. The
Loans comprising any Borrowing shall be (i) in the case of Competitive Loans and
LIBOR Loans, in an aggregate principal Dollar Equivalent Amount that is an
integral multiple of $5,000,000 and not less than $10,000,000 and (ii) in the
case of ABR Loans, in an aggregate principal amount that is an integral multiple
of $500,000 and not less than $5,000,000 (or if less, an aggregate principal
amount equal to the remaining balance of the available Total Commitment). Each
Borrowing of Canadian Revolving Credit Loans shall be in an amount equal to (A)
in the case of C$ Prime Rate Loans, C$1,000,000 or a whole multiple of C$500,000
in excess thereof (or, if the then available Total Commitments or Canadian
Commitments are less than C$500,000, such lesser amount) and (B) in the case of
B/As, C$2,500,000 or a whole multiple of C$100,000 in excess thereof.
(b) Each Competitive Borrowing shall be comprised entirely of LIBOR
Competitive Loans or Fixed Rate Loans, each Primary Borrowing shall be comprised
entirely of LIBOR Revolving Credit Loans or ABR Loans, as the Borrower may
request pursuant to Section 2.4 or 2.5, as applicable, each Canadian Borrowing
shall be comprised entirely of C$ Prime Rate Loans or B/As, as the Canadian
Borrower may request pursuant to Section 2.5 and each Pounds Sterling Borrowing
shall be comprised entirely of LIBOR Revolving Credit Loans. Each US Lender may
at its option make any LIBOR Loan by causing any domestic or foreign branch or
Affiliate of such US Lender to make such Loan, provided that any exercise of
such option shall not affect the obligation of the Borrower to repay such Loan
in accordance with the terms of this Agreement and the applicable Note.
Borrowings of more than one Interest Rate Type may be outstanding at the same
time; provided that the Borrowers shall not be entitled to request any Borrowing
that, if made, would result in an aggregate of more than twenty (20) separate
Loans (other than Competitive Loans) of any Lender being outstanding hereunder
at any one time. For purposes of the calculation required by the immediately
preceding sentence, LIBOR Revolving Credit Loans having different Interest
Periods or having been made in different Currencies, regardless of whether they
commence on the same date, shall be considered separate Loans and
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all Loans of a single Interest Rate Type made on a single date shall be
considered a single Loan if such Loans have a common Interest Period.
(c) (i) Subject to Section 2.6, each US Lender shall make each Loan to
be made by it hereunder on the proposed date thereof by making funds available
at the office of the Administrative Agent specified in Section 9.1 for credit to
PHH Corporation Clearing Account, Account No. ▇▇▇-▇-▇▇▇▇▇ (Reference: PHH
Corporation Credit Agreement dated as of March 4, 1997) or as otherwise directed
by the Administrative Agent no later than 1:00 P.M. New York City time in the
case of Loans other than ABR Loans, and 4:00 P.M. New York City time in the case
of ABR Loans, in each case, in immediately available funds. Upon receipt of the
funds to be made available by the US Lenders to fund any Borrowing hereunder,
the Administrative Agent shall disburse such funds by depositing them into an
account of the Borrower maintained with the Administrative Agent. Competitive
Loans shall be made by the Lender or Lenders whose Competitive Bids therefor are
accepted pursuant to Section 2.4 in the amounts so accepted and Primary Loans
and Pounds Sterling Loans shall be made by all the Primary Lenders or Pounds
Sterling Lenders, as the case may be, pro rata in accordance with Section 2.1
and this Section 2.2.
(ii) Subject to Section 2.6, each Canadian Lender shall make each
Canadian Loan to be made by it hereunder on the proposed date thereof by making
funds available to the Canadian Agent at Royal Bank of Canada Swift Code
▇▇▇▇▇▇▇▇, for credit to PHH Vehicle Management Services Inc. Clearing Account,
Account No. ▇▇▇-▇▇▇-▇ (Reference: PHH Vehicle Management Services Inc. Credit
Agreement dated as of March 4, 1997) no later than 4:00 P.M. Toronto time in the
case of Canadian Loans (other than C$ Prime Rate Loans) and 1:00 P.M. Toronto
time in the case of C$ Prime Rate Loans, in each case, in immediately available
funds. Upon receipt of the funds to be made available by the Canadian Lenders to
fund any Canadian Borrowing hereunder, the Canadian Agent shall disburse such
funds by depositing them into an account of the Canadian Borrower maintained
with the Canadian Agent. Canadian Revolving Credit Loans shall be made by all
the Canadian Lenders pro rata in accordance with Section 2.1 and this Section
2.2.
(d) Notwithstanding any other provision of this Agreement, the
Borrowers shall not be entitled to request any Borrowing if the Interest Period
requested with respect thereto would end after the Maturity Date.
SECTION 2.3. Use of Proceeds
The proceeds of the Loans shall be used for working capital and general
corporate purposes.
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SECTION 2.4. Competitive Bid Procedure.
(a) In order to request Competitive Bids, the Borrower shall hand
deliver or telecopy to the Administrative Agent a duly completed Competitive Bid
Request in the form of Exhibit E-1, to be received by the Administrative Agent
(i) in the case of a LIBOR Competitive Borrowing, not later than 2:00 p.m., New
York City time, four Working Days before a proposed Competitive Borrowing and
(ii) in the case of a Fixed Rate Borrowing, not later than 2:00 p.m., New York
City time, one Business Day before a proposed Competitive Borrowing. Each
Competitive Bid Request shall specify the requested Currency. No ABR Loan, C$
Prime Rate Loan or Bankers' Acceptance shall be requested in, or made pursuant
to, a Competitive Bid Request. A Competitive Bid Request that does not conform
substantially to the format of Exhibit E-1 may be rejected in the Administrative
Agent's sole discretion, and the Administrative Agent shall promptly notify the
Borrower of such rejection by telecopier. Such request for Competitive Bids
shall in each case refer to this Agreement and specify (i) whether the Borrowing
then being requested is to be a LIBOR Borrowing or a Fixed Rate Borrowing, (ii)
the date of such Borrowing (which shall be a Business Day in the case of a Fixed
Rate Borrowing and a Working Day in the case of a LIBOR Competitive Borrowing)
and the aggregate principal Dollar Equivalent Amount thereof, which shall be in
a minimum principal Dollar Equivalent Amount of $10,000,000 and in an integral
multiple of $5,000,000, and (iii) the Interest Period with respect thereto
(which may not end after the Maturity Date). Promptly after its receipt of a
Competitive Bid Request that is not rejected as aforesaid, the Administrative
Agent shall invite by telecopier (in the form set forth in Exhibit E-2) the
Lenders to bid, on the terms and subject to the conditions of this Agreement, to
make Competitive Loans pursuant to such Competitive Bid Request.
(b) Each Lender may, in its sole discretion, make one or more
Competitive Bids to the Borrower responsive to a Competitive Bid Request. Each
Competitive Bid by a Lender must be received by the Administrative Agent via
telecopier, in the form of Exhibit E-3, (i) in the case of a LIBOR Competitive
Borrowing, not later than 9:30 a.m., New York City time, three Working Days
before a proposed Competitive Borrowing and (ii) in the case of a Fixed Rate
Borrowing, not later than 9:30 a.m., New York City time, on the day of a
proposed Competitive Borrowing. Multiple Competitive Bids will be accepted by
the Administrative Agent. Competitive Bids that do not conform substantially to
the format of Exhibit E-3 may be rejected by the Administrative Agent after
conferring with, and upon the instruction of, the Borrower, and the
Administrative Agent shall notify the Lender making such nonconforming
Competitive Bid of such rejection as soon as practicable. Each Competitive Bid
shall refer to this Agreement and specify (i) the principal Dollar Equivalent
Amount (which shall be in a minimum principal Dollar Equivalent Amount of
$10,000,000 and in an integral multiple of $5,000,000 and which may equal the
entire principal amount of the Competitive Borrowing requested by the Borrower)
of the Competitive Loan or Loans that the applicable Lender is willing to make
to the Borrower, (ii) the Competitive Bid Rate or Rates at which such Lender is
prepared to make such Competitive Loan or Loans and (iii) the Interest Period or
Interest Periods with respect thereto. If any Lender shall elect not to make a
Competitive Bid, such Lender shall so notify the
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Administrative Agent via telecopier (i) in the case of LIBOR Competitive Loans,
not later than 9:30 a.m., New York City time, three Working Days before a
proposed Competitive Borrowing and (ii) in the case of Fixed Rate Loans, not
later than 9:30 a.m., New York City time, on the day of a proposed Competitive
Borrowing; provided that failure by any Lender to give such notice shall not
cause such Lender to be obligated to make any Competitive Loan as part of such
proposed Competitive Borrowing. A Competitive Bid submitted by a Lender pursuant
to this paragraph (b) shall be irrevocable.
(c) The Administrative Agent shall promptly notify the Borrower by
telecopier of all the Competitive Bids made, the Competitive Bid Rate or Rates
and the principal amount of each Competitive Loan in respect of which a
Competitive Bid was made and the identity of the Lender that made each
Competitive Bid. The Administrative Agent shall send a copy of all Competitive
Bids to the Borrower for its records as soon as practicable after completion of
the bidding process set forth in this Section 2.4.
(d) The Borrower may in its sole and absolute discretion, subject only
to the provisions of this paragraph (d), accept or reject any Competitive Bid
referred to in paragraph (c) above. The Borrower shall notify the Administrative
Agent by telephone, promptly confirmed by telecopier in the form of a
Competitive Bid Accept/Reject Letter whether and to what extent it has decided
to accept or reject any or all of the Competitive Bids referred to in paragraph
(c) above, (i) in the case of a LIBOR Competitive Borrowing, not later than
10:30 a.m., New York City time, three Working Days before a proposed Competitive
Borrowing and (ii) in the case of a Fixed Rate Borrowing, not later than 10:30
a.m., New York City time, on the day of a proposed Competitive Borrowing;
provided that (A) the failure by the Borrower to give such notice shall be
deemed to be a rejection of all the Competitive Bids referred to in paragraph
(c) above, (B) the Borrower shall not accept a Competitive Bid made at a
particular Competitive Bid Rate if the Borrower has decided to reject a
Competitive Bid made at a lower Competitive Bid Rate, (C) the aggregate amount
of the Competitive Bids accepted by the Borrower shall not exceed the principal
amount specified in the Competitive Bid Request, (D) if the Borrower shall
accept a Competitive Bid or Competitive Bids made at a particular Competitive
Bid Rate but the amount of such Competitive Bid or Competitive Bids shall cause
the total amount of Competitive Bids to be accepted by the Borrower to exceed
the amount specified in the Competitive Bid Request, then the Borrower shall
accept a portion of such Competitive Bid or Competitive Bids in an amount equal
to the amount specified in the Competitive Bid Request less the amount of all
other Competitive Bids accepted at lower Competitive Bid Rates with respect to
such Competitive Bid Request (it being understood that acceptance in the case of
multiple Competitive Bids at such Competitive Bid Rate, shall be made pro rata
in accordance with the amount of each such Competitive Bid at such Competitive
Bid Rate), (E) except pursuant to clause (D) above, no Competitive Bid shall be
accepted for a Competitive Loan unless such Competitive Loan is in a minimum
principal Dollar Equivalent Amount of $10,000,000 and an integral multiple of
$5,000,000 and (F) the Borrower may not accept Competitive Bids for Competitive
Loans in any Currency other than the Currency specified in the related
Competitive Bid Request; and provided, further, that if a Competitive Loan must
be in an amount less than the Dollar
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Equivalent Amount of $10,000,000 because of the provisions of clause (D) above,
such Competitive Loan shall be in a minimum principal Dollar Equivalent Amount
of $1,000,000 or any integral multiple thereof, and in calculating the pro rata
allocation of acceptances of portions of multiple Competitive Bids at a
particular Competitive Bid Rate pursuant to clause (D), the amounts shall be
rounded to integral multiples of $1,000,000 in a manner that shall be in the
discretion of the Borrower. A notice given by the Borrower pursuant to this
paragraph (d) shall be irrevocable.
(e) The Administrative Agent shall promptly notify each bidding Lender
whether its Competitive Bid has been accepted (and if so, in what amount and at
what Competitive Bid Rate) by telecopy sent by the Administrative Agent, and
each successful bidder will thereupon become bound, subject to the other
applicable conditions hereof, to make the Competitive Loan in respect of which
its Competitive Bid has been accepted in the applicable Currency.
(f) If the Administrative Agent shall elect to submit a Competitive Bid
in its capacity as a Lender, it shall submit such Competitive Bid directly to
the Borrower one quarter of an hour earlier than the latest time at which the
other Lenders are required to submit their Competitive Bids to the
Administrative Agent pursuant to paragraph (b) above. Canadian Lenders shall not
be permitted to extend Competitive Loans.
(g) All notices required by this Section 2.4 shall be given in
accordance with Section 9.1.
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SECTION 2.5. Revolving Credit Borrowing Procedure
(a) In order to effect a Revolving Credit Borrowing, the Borrower shall
hand deliver or telecopy to the Administrative Agent a Borrowing notice in the
form of Exhibit F (a) in the case of a Borrowing of a LIBOR Revolving Credit
Loan, not later than 2:00 p.m., New York City time, three Working Days before a
proposed Borrowing, and (b) in the case of an ABR Borrowing, not later than 2:00
p.m., New York City time, on the day of a proposed Borrowing. No Fixed Rate Loan
or LIBOR Competitive Loan shall be requested or made pursuant to a Revolving
Credit Borrowing Request. Such notice shall be irrevocable and shall in each
case specify (a) whether the Borrowing then being requested is to be a Borrowing
of a LIBOR Revolving Credit Loan or an ABR Borrowing, (b) the date of such
Revolving Credit Borrowing (which shall be a Working Day) and the amount
thereof, (c) if such Borrowing is to be a Borrowing of LIBOR Revolving Credit
Loans, the Interest Period with respect thereto and (d) whether such Borrowing
is to be made in Dollars or U.K. Pounds Sterling. If no election as to the
Interest Rate Type of a Revolving Credit Borrowing is specified in any such
notice, then the requested Revolving Credit Borrowing shall be an ABR Borrowing.
Pounds Sterling Loans shall be a Borrowing of LIBOR Revolving Credit Loans. If
no Interest Period with respect to any Borrowing of LIBOR Revolving Credit Loans
is specified in any such notice, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration. If the Borrower shall not
have given notice in accordance with this Section 2.5 of its election to
refinance a Revolving Credit Borrowing prior to the end of the Interest Period
in effect for such Borrowing, then the Borrower shall (unless such Borrowing is
repaid at the end of such Interest Period) be deemed to have given notice of an
election to refinance such Borrowing with an ABR Borrowing in the case of
Primary Loans and a LIBOR Revolving Credit Loan with an Interest Period of one
month's duration in the case of a Pounds Sterling Loan. The Administrative Agent
shall promptly advise the Primary or Pounds Sterling Lenders, as the case may
be, of any notice given pursuant to this Section 2.5 and of each such Lender's
portion of the requested Borrowing.
(b) The Canadian Borrower may borrow under the Canadian Commitments of
the Canadian Lenders during the Commitment Period on any Business Day, provided
that the Canadian Borrower shall give the Canadian Agent (and the Administrative
Agent) irrevocable notice (a "Notice of Canadian Borrowing") (which notice must
be received by the Canadian Agent prior to (a) 2:00 p.m., Toronto time, three
Business Days prior to the requested Borrowing Date, if all or any part of the
requested Canadian Revolving Credit Loans are to be initially B/As or (b) 2:00
p.m., Toronto time, on the requested Borrowing Date, otherwise), specifying (i)
the amount to be borrowed, (ii) the requested Borrowing Date, (iii) whether the
borrowing is to be of C$ Prime Rate Loans or B/As or a combination thereof and
(iv) if the borrowing is to be entirely or partially of B/As, the respective
amounts and lengths of the initial Contract Period thereof. Upon receipt of any
such notice from the Canadian Borrower, the Canadian Agent shall promptly notify
each Canadian Lender thereof.
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SECTION 2.6. Refinancings
Each of the Borrowers may refinance all or any part of any Borrowing
made by it with a Borrowing of the same or a different Interest Rate Type made
pursuant to Section 2.4 (in the case of the Borrower) or pursuant to a notice
under Section 2.5, subject to the conditions and limitations set forth herein
and elsewhere in this Agreement, including, in the case of the Borrower,
refinancings of Competitive Borrowings with Revolving Credit Borrowings in
Dollars and Revolving Credit Borrowings in Dollars with Competitive Borrowings;
provided that (i) a Borrowing by way of B/As may be refinanced only on the last
day of the relevant Contract Period and (ii) on any partial refinancing from a
C$ Prime Rate Loan, or B/A, not less than C$500,000 shall remain as Borrowings
by way of C$ Prime Rate Loan or B/A, as applicable and; provided, further, that
at any time after the occurrence, and during the continuation, of a Default or
an Event of Default, (i) a Revolving Credit Borrowing of Dollars or portion
thereof may only be refinanced with an ABR Borrowing and (ii) C$ Revolving
Credit Loans may not be refinanced with a B/A. Any Borrowing or part thereof so
refinanced shall be deemed to be repaid in accordance with Section 2.8 with the
proceeds of a new Borrowing hereunder and the proceeds of the new Borrowing, to
the extent they do not exceed the principal amount of the Borrowing being
refinanced, shall not be paid by the applicable Lenders to the Applicable Agent
or by the Applicable Agent to the Applicable Borrower pursuant to Section
2.2(c); provided that (a) if the principal amount extended by a Lender in a
refinancing is greater than the principal amount extended by such Lender in the
Borrowing being refinanced, then such Lender shall pay such difference to the
Applicable Agent for distribution to the Lenders described in clause (b) below,
(b) if the principal amount extended by a Lender in the Borrowing being
refinanced is greater than the principal amount being extended by such Lender in
the refinancing, the Applicable Agent shall return the difference to such Lender
out of amounts received pursuant to clause (a) above, and (c) to the extent any
Lender fails to pay the Applicable Agent amounts due from it pursuant to clause
(a) above, any Loan or portion thereof being refinanced with such amounts shall
not be deemed repaid in accordance with Section 2.8 and, to the extent of such
failure, the Applicable Borrower shall pay such amount to the Applicable Agent
as required by Section 2.10; and (d) to the extent the Applicable Borrower fails
to pay to the Applicable Agent any amounts due in accordance with Section 2.8 as
a result of the failure of a Lender to pay the Applicable Agent any amounts due
as described in clause (c) above, the portion of any refinanced Loan deemed not
repaid shall be deemed to be outstanding solely to the Lender which has failed
to pay the Applicable Agent amounts due from it pursuant to clause (a) above to
the full extent of such Lender's portion of such Loan.
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SECTION 2.7. Fees
(a) The Borrower agrees to pay to each Primary Lender, through the
Administrative Agent, on each March 31, June 30, September 30 and December 31,
commencing March 31, 1997, and on the date on which the Primary Commitment of
such Lender shall be terminated as provided herein, a facility fee (a "Facility
Fee",) at the rate per annum from time to time in effect in accordance with
Section 2.22, on the amount of the Primary Commitment of such Lender, whether
used or unused, during the preceding quarter (or shorter period commencing with
the Closing Date, or ending with the Maturity Date or any date on which the
Primary Commitment of such Lender shall be terminated). All Facility Fees shall
be computed on the basis of the actual number of days elapsed in a year of 360
days. The Facility Fee due to each Primary Lender shall commence to accrue on
the Closing Date, shall be payable in arrears and shall cease to accrue on the
earlier of the Maturity Date and the termination of the Primary Commitment of
such Lender as provided herein.
(b) The Borrower agrees to pay the Administrative Agent, for its own
account, the fees at the times and in the amounts provided for in the letter
agreement dated February 4, 1997 among the Borrower, Chase and Chase Securities
Inc.
(c) All fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders. Once paid, none of the fees shall be refundable under any
circumstances.
SECTION 2.8. Repayment of Loans; Evidence of Debt
(a) (i) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Revolving Credit Loan of such Lender on the Maturity Date (or
such earlier date on which the Revolving Credit Loans become due and payable
pursuant to Article 7); provided that the Revolving Credit Loans made by
Objecting Lenders shall be repaid as provided in Section 2.24. The Borrower
hereby further agrees to pay to the Administrative Agent interest on the unpaid
principal amount of the Revolving Credit Loans from time to time outstanding
from the date hereof until payment in full thereof at the rates per annum, and
on the dates, set forth in Section 2.9.
(ii) The Canadian Borrower hereby unconditionally promises to pay to
the Canadian Agent (with notice to the Administrative Agent) for the account of
each Canadian Lender the then unpaid principal amount of each Canadian Revolving
Credit Loan of such Canadian Lender on the Maturity Date (or such earlier date
on which the Canadian Revolving Credit Loans become due and payable pursuant to
Article 7 or such earlier date on which the Borrower shall fail to own, directly
or indirectly, beneficially and of record, all of the capital stock of the
Canadian Borrower); provided that the Canadian Revolving Credit Loans made by
Objecting Lenders shall be repaid as provided in Section 2.25. The Canadian
Borrower hereby
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further agrees to pay to the Canadian Agent (with notice to the Administrative
Agent) interest on the unpaid principal amount of the Canadian Revolving Credit
Loans from time to time outstanding from the date hereof until payment in full
thereof at the rates per annum, and on the dates, set forth in Section 2.9.
(b) The Borrower unconditionally promises to pay to the Administrative
Agent, for the account of each Lender that makes a Competitive Loan, on the last
day of the Interest Period applicable to such Competitive Loan, the principal
amount of such Competitive Loan. The Borrower further unconditionally promises
to pay interest on each such Competitive Loan for the period from and including
the date of Borrowing of such Competitive Loan on the unpaid principal amount
thereof from time to time outstanding at the applicable rate per annum
determined as provided in, and payable as specified in, Section 2.9.
(c) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrower and the Canadian
Borrower to such Lender resulting from each Loan of such Lender from time to
time, including the amounts of principal and interest payable and paid to such
Lender from time to time under this Agreement.
(d) The Administrative Agent shall maintain the Register pursuant to
Section 9.3(e), and a subaccount therein for each Lender, in which shall be
recorded (i) the amount of each Loan made hereunder, the Interest Rate Type
thereof and each Interest Period or Contract Period, if any, applicable thereto,
(ii) the amount of any principal or interest due and payable or to become due
and payable from each Borrower to each Lender or the Canadian Agent hereunder
and (iii) both the amount of any sum received by the Administrative Agent
hereunder from the Borrower or the Canadian Borrower, as the case may be, and
each Lender's share thereof.
(e) The entries made in the Register and the accounts of each Lender
maintained pursuant to Section 2.8(c) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrowers therein recorded; provided that the failure of any
Lender or the Administrative Agent to maintain the Register or any such account,
or any error therein, shall not in any manner affect the obligation of the
Borrowers to repay (with applicable interest) the Loans made to such Borrower by
such Lender in accordance with the terms of this Agreement.
(f) The Borrower agrees that, upon the request to the Administrative
Agent by any Primary Lender, the Borrower will execute and deliver to such
Primary Lender a promissory note of the Borrower evidencing the Primary Loans of
such Primary Lender, substantially in the form of Exhibit A-1 with appropriate
insertions as to date and principal amount (a "Revolving Credit Note").
(g) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the Competitive Loans of such Lender,
substantially in the form of Exhibit
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A-2 with appropriate insertions as to date, principal amount and Currency (a
"Competitive Note").
(h) The Canadian Borrower agrees that, upon the request to the Canadian
Agent by any Canadian Lender, the Canadian Borrower will execute and deliver to
such Canadian Lender a promissory note of the Canadian Borrower evidencing the
Canadian Revolving Credit Loans of such Canadian Lender, substantially in the
form of Exhibit A-3 with appropriate insertions as to date and principal amount
(a "Canadian Revolving Credit Note").
(i) The Borrower agrees that, upon the request of the Administrative
Agent by any Pounds Sterling Lender, the Borrower will execute and deliver to
such Lender a promissory note of the Borrower evidencing the Pounds Sterling
Loans of such Pounds Sterling Lender, substantially in the form of Exhibit A-4
with appropriate insertions as to date and principal amount ("Pounds Sterling
Note").
SECTION 2.9. Interest on Loans.
(a) (i) Subject to the provisions of Section 2.10, the Loans comprising
each LIBOR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days or 365 days in the case of a
Pounds Sterling Loan) at a rate per annum equal to (i) in the case of each LIBOR
Revolving Credit Loan, LIBOR for the Interest Period in effect for such
Borrowing plus the applicable LIBOR Spread from time to time in effect and (ii)
in the case of each LIBOR Competitive Loan, LIBOR for the Interest Period in
effect for such Borrowing plus or minus the Margin offered by the Lender making
such Loan and accepted by the Borrower pursuant to Section 2.4. Interest on each
LIBOR Borrowing shall be payable on each applicable Interest Payment Date.
(ii) Subject to the provisions of Section 2.10, the Loans comprising
each B/A Borrowing shall be subject to an Acceptance Fee (computed on the basis
of the actual number of days elapsed over a year of 365 days) calculated and
payable at a rate per annum equal to the applicable B/A Spread from time to time
in effect payable as set forth in Section 2.25(f).
(b) (i) Subject to the provisions of Section 2.10, the Loans comprising
each ABR Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 365 or 366 days, as the case may be when
determined by reference to the Prime Rate and over a year of 360 days at all
other times) at a rate per annum equal to the Alternate Base Rate.
(ii) Subject to the provisions of Section 2.10, the Loans comprising
each C$ Prime Rate Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days, as the case may
be) at a rate per annum equal to the C$ Prime Rate.
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(c) Subject to the provisions of Section 2.10, each Fixed Rate Loan
shall bear interest at a rate per annum (computed on the basis of the actual
number of days elapsed over a year of 360 days) equal to the fixed rate of
interest offered by the Lender making such Loan and accepted by the Borrower
pursuant to Section 2.4.
(d) Interest on each Loan (other than in the case of a B/A, which shall
be payable in accordance with Section 2.25) shall be payable in arrears on each
Interest Payment Date applicable to such Loan. The LIBOR or the Alternate Base
Rate for each Interest Period or day within an Interest Period shall be
determined by the Administrative Agent, the C$ Prime Rate for each Interest
Period or day within an Interest Period shall be determined by the Canadian
Agent, and, in each case, such determination shall be conclusive absent manifest
error.
(e) For the purposes of the Interest Act (Canada) and disclosure
thereunder, whenever interest to be paid hereunder or in connection herewith is
to be calculated on the basis of a year of 360 days or any other period of time
that is less than a calendar year, the yearly rate of interest to which the rate
determined pursuant to such calculation is equivalent is the rate so determined
multiplied by the actual number of days in the calendar year in which the same
is to be ascertained and divided by either 360 or such other period of time, as
the case may be.
(f) If any provision of any Fundamental Document would oblige the
Canadian Borrower to make any payment of interest or other amount payable to any
Canadian Lender in an amount or calculated at a rate which would be prohibited
by law or would result in a receipt by that Canadian Lender of interest at a
criminal rate (as such terms are construed under the Criminal Code (Canada)),
then notwithstanding such provision, such amount or rate shall be deemed to have
been adjusted with retroactive effect to the maximum amount or rate of interest,
as the case may be, as would not be so prohibited by law or so result in a
receipt by that Canadian Lender of interest at a criminal rate, such adjustment
to be effected, to the extent necessary, as follows:
(i) first, by reducing the amount or rate of interest required
to be paid to the affected Canadian Lender under Section 2.9 or 2.10;
and
(ii) thereafter, by reducing any fees, commissions, premiums
and other amounts required to be paid to the affected Canadian Lender
which would constitute interest for purposes of Section 347 of the
Criminal Code (Canada).
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SECTION 2.10. Interest on Overdue Amounts.
If either Borrower shall default in the payment of the principal of, or
interest on, any Loan or any other amount becoming due hereunder, the Applicable
Borrower shall on demand from time to time pay interest, to the extent permitted
by Applicable Law, on such defaulted amount up to (but not including) the date
of actual payment (after as well as before judgment) at a rate per annum
computed on the basis of the actual number of days elapsed over a year of 365
days in the case of B/As and 365 or 366 days, as applicable, in the case of
amounts bearing interest determined by reference to the Prime Rate or the C$
Prime Rate and a year of 360 days in all other cases, equal to (a) in the case
of the remainder of the then current Interest Period or Contract Period, as the
case may be, for any LIBOR Loan or Fixed Rate Loan or B/A, the rate applicable
to such Loan under Section 2.9 plus 2% per annum and (b) in the case of any
other amount, the rate that would at the time be applicable to an ABR Loan if
such other amount is payable in US$ or to a C$ Prime Rate Loan if such other
amount is payable in C$, in each case, under Section 2.9 plus 2% per annum.
SECTION 2.11. Alternate Rate of Interest.
In the event the Administrative Agent shall have determined that
deposits in Dollars or the applicable Available Foreign Currency in the amount
of the requested principal amount of any LIBOR Loan are not generally available
in the London Interbank Market (or such other interbank eurocurrency market
where the foreign currency and exchange operations in respect of Dollars or such
applicable Available Foreign Currency, as the case may be, are then being
conducted for delivery on the first day of such Interest Period), or that the
rate at which such deposits are being offered will not adequately and fairly
reflect the cost to any Lender of making or maintaining its portion of such
LIBOR Loans during such Interest Period, or that reasonable means do not exist
for ascertaining LIBOR, the Administrative Agent shall, as soon as practicable
thereafter, give written or telecopier notice of such determination to the
Borrower and the Lenders. In the event of any such determination, until the
Administrative Agent shall have determined that circumstances giving rise to
such notice no longer exist, (a) any request by the Borrower for a LIBOR
Competitive Borrowing pursuant to Section 2.4 shall be of no force and effect
and shall be denied by the Administrative Agent and (b) any request by the
Borrower for a LIBOR Borrowing pursuant to Section 2.5 shall be deemed to be a
request for an ABR Loan. Each determination by the Administrative Agent
hereunder shall be conclusive absent manifest error.
SECTION 2.12. Termination and Reduction of Commitments.
(a) (i) The Commitments of all of the Lenders shall be automatically
terminated on the earlier of (A) the Maturity Date or (B) April 15, 1997 if the
Closing Date has not occurred on or prior to such date.
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(ii) The Canadian Commitments of all of the Canadian Lenders shall be
automatically terminated on such date on which the Borrower shall fail to own,
directly or indirectly, beneficially and of record, all of the capital stock of
the Canadian Borrower.
(b) Subject to Section 2.13(b), upon at least three Business Days'
prior irrevocable written or telecopy notice to the Administrative Agent (which
shall promptly notify each Lender), the Borrower may at any time in whole
permanently terminate, or from time to time in part permanently reduce, the the
Commitments; provided that (i) each partial reduction shall be in an integral
multiple of $1,000,000 and in a minimum principal amount of $10,000,000 and (ii)
the Borrower shall not be entitled to make any such termination or reduction
that would reduce a type of Commitment to an amount less than the sum of the
aggregate outstanding principal Dollar Equivalent Amount of the related Loans.
(c) Each reduction in a type of Commitment hereunder shall be made
ratably among the applicable Lenders in accordance with their respective
Commitments. The Borrower shall pay to the Administrative Agent for the account
of the applicable Lenders on the date of each termination or reduction in a type
of Commitment, the Facility Fees on the amount of the Commitments so terminated
or reduced accrued to the date of such termination or reduction.
SECTION 2.13. Prepayment of Loans.
(a) (i) Prior to the Maturity Date, the Borrower shall have the right
at any time to prepay any Revolving Credit Borrowing, in whole or in part,
subject to the requirements of Section 2.17 but otherwise without premium or
penalty, upon prior written or telecopy notice to the Administrative Agent
(which shall promptly notify each Lender) before 2:00 p.m. New York City time of
at least one Business Day in the case of an ABR Loan and of at least three
Working Days in the case of a LIBOR Loan; provided that each such partial
prepayment shall be in a minimum aggregate principal Dollar Equivalent Amount of
$1,000,000 or a whole multiple in excess thereof. The Borrower shall not have
the right to prepay any Competitive Borrowing without the consent of the
relevant Lender.
(ii) Prior to the Maturity Date, the Canadian Borrower shall have the
right at any time to prepay any C$ Prime Rate Loan, in whole or in part, without
premium or penalty, upon prior written or telecopy notice to the Canadian Agent
before 2:00 p.m. Toronto time of at least three Business Days; provided that
each such partial prepayment shall be in a minimum aggregate principal amount of
$1,000,000 or a whole multiple in excess thereof. The Borrower shall not have
the right to optionally prepay any B/As.
(b) (i) On any date when the sum of the Dollar Equivalent Amount of the
aggregate outstanding Loans (after giving effect to any Borrowings effected on
such date) exceeds the Total Commitment, the Borrower shall make a mandatory
prepayment of the Loans in such amount as may be necessary so that the Dollar
Equivalent Amount of the aggregate amount of outstanding Loans after giving
effect to such prepayment does not exceed the Total
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Commitment then in effect. Any prepayments required by this paragraph shall be
applied to outstanding ABR Loans and C$ Prime Rate Loans up to the full amount
thereof before they are applied to outstanding LIBOR Loans or B/A's.
(ii) If at any date the sum of the Dollar Equivalent Amount of the
Canadian Revolving Credit Loans exceeds 105% (or 110% to the extent such
Canadian Loans consist of B/As' for which the remaining Contract Period as of
such date is less than 60 days), of the Canadian Commitments (including at any
time after any reduction of the Canadian Commitments pursuant to Section 2.12),
the Canadian Agent may promptly notify the Canadian Borrower, and the next
Business Day after such notification, the Canadian Borrower shall make a payment
in the amount of such excess. Any such payment shall be applied first, to
payment of the C$ Prime Rate Loans and second, to cash collateralize any
outstanding B/As on terms satisfactory to the Canadian Agent acting reasonably.
(iii) If at any date the sum of the Dollar Equivalent Amount of the
Pounds Sterling Loans exceeds 105% (or 110% to the extent such Pounds Sterling
Loans consist of LIBOR Loans for which the remaining Interest Period as of such
date is less than 2 calendar months) of the Pounds Sterling Commitments
(including at any time after any reduction of the Pounds Sterling Commitments
pursuant to Section 2.12), the Administrative Agent may promptly notify the
Borrower, and the next Business Day after such notification, the Borrower shall
make a payment in the amount of such excess, which payment shall be applied to
reduce the outstanding Pounds Sterling Loans.
(c) Each notice of prepayment pursuant to this Section 2.13 shall
specify the specific Borrowing(s), the prepayment date and the aggregate
principal amount of each Borrowing to be prepaid, shall be irrevocable and shall
commit the Applicable Borrower to prepay such Borrowing(s) by the amount stated
therein. All prepayments under this Section 2.13 shall be accompanied by accrued
interest on the principal amount being prepaid to the date of prepayment and any
amounts due pursuant to Section 2.17.
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SECTION 2.14. Eurocurrency Reserve Costs.
The Borrower shall pay to the Administrative Agent for the account of
each Lender, so long as such Lender shall be required under regulations of the
Board to maintain reserves with respect to liabilities or assets consisting of,
or including, Eurocurrency Liabilities (as defined in Regulation D of the Board)
(or, at any time when such Lender may be required by the Board or by any other
Governmental Authority, whether within the United States or in another relevant
jurisdiction, to maintain reserves against any other category of liabilities
which includes deposits by reference to which LIBOR is determined as provided in
this Agreement or against any category of extensions of credit or other assets
of such Lender which includes any such LIBOR Loans), additional interest on the
unpaid principal amount of each LIBOR Loan made to the Borrower by such Lender,
from the date of such Loan until such Loan is paid in full, at an interest rate
per annum equal at all times during the Interest Period for such Loan to the
remainder obtained by subtracting (i) LIBOR for such Interest Period from (ii)
the rate obtained by multiplying LIBOR as referred to in clause (i) above by the
Statutory Reserves of such Lender for such Interest Period, provided that with
respect to Pounds Sterling Loans such additional interest shall be calculated as
specified on Schedule 2.14. Such additional interest shall be determined by such
Lender and notified to the Borrower (with a copy to the Administrative Agent)
not later than five Business Days before the next Interest Payment Date for such
Loan, and such additional interest so notified to the Borrower by any Lender
shall be payable to the Administrative Agent for the account of such Lender on
each Interest Payment Date for such Loan.
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SECTION 2.15. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of
this Agreement any change in Applicable Law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) (i) shall subject any Lender to, or increase the net amount of,
any tax, levy, impost, duty, charge, fee, deduction or withholding with respect
to any Loan, or shall change the basis of taxation of payments to any Lender of
the principal of or interest on any Loan made by such Lender or any other fees
or amounts payable hereunder (other than (x) taxes imposed on the overall net
income of such Lender by the jurisdiction in which such Lender has its principal
office or its applicable Lending Office or by any political subdivision or
taxing authority therein (or any tax which is enacted or adopted by such
jurisdiction, political subdivision or taxing authority as a direct substitute
for any such taxes) or (y) any tax, assessment, or other governmental charge
that would not have been imposed but for the failure of any Lender to comply
with any certification, information, documentation or other reporting
requirement), (ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender, or (iii) shall impose on any
Lender or eurocurrency market any other condition affecting this Agreement or
any Loan made by such Lender, and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Loan or to reduce
the amount of any sum received or receivable by such Lender hereunder (whether
of principal, interest or otherwise) in respect thereof by an amount deemed in
good faith by such Lender to be material, then the Borrowers shall pay such
additional amount or amounts as will compensate such Lender for such increase or
reduction to such Lender upon demand by such Lender.
(b) If, after the date of this Agreement, any Lender shall have
determined in good faith that the adoption after the date hereof of or any
change after the date hereof in any applicable law, rule, regulation or
guideline regarding capital adequacy, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or any Lending Office of such Lender) with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on such Lender's capital or on
the capital of such Lender's holding company, if any, as a consequence of its
obligations hereunder to a level below that which such Lender (or its holding
company) could have achieved but for such applicability, adoption, change or
compliance (taking into consideration such Lender's policies or the policies of
its holding company, as the case may be, with respect to capital adequacy) by an
amount deemed by such Lender to be material, then, from time to time, the
Borrower shall pay to the Administrative Agent for the account of such Lender
(or its holding company) such additional amount or amounts as will compensate
such Lender for such reduction upon demand by such Lender.
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(c) A certificate of a Lender setting forth in reasonable detail (i)
such amount or amounts as shall be necessary to compensate such Lender as
specified in paragraph (a) or (b) above, as the case may be, and (ii) the
calculation of such amount or amounts referred to in the preceding clause (i),
shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay the Administrative Agent for the account of such
Lender the amount shown as due on any such certificate within 10 Business Days
after its receipt of the same.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any Interest Period or Contract Period shall
not constitute a waiver of such Lender's rights to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to such Interest Period or any other Interest
Period or Contract Period. The protection of this Section 2.15 shall be
available to each Lender regardless of any possible contention of invalidity or
inapplicability of the law, regulation or condition which shall have been
imposed.
(e) Each Lender agrees that, as promptly as practicable after it
becomes aware of the occurrence of an event or the existence of a condition that
(i) would cause it to incur any increased cost under this Section 2.15, Section
2.16 or Section 2.21 or (ii) would require the Borrower to pay an increased
amount under this Section 2.15, Section 2.16 or Section 2.21, it will use
reasonable efforts to notify the Borrower of such event or condition and, to the
extent not inconsistent with such Lender's internal policies, will use its
reasonable efforts to make, fund or maintain the affected Loans of such Lender
through another Lending Office of such Lender if as a result thereof the
additional monies which would otherwise be required to be paid or the reduction
of amounts receivable by such Lender thereunder in respect of such Loans would
be materially reduced, or any inability to perform would cease to exist, or the
increased costs which would otherwise be required to be paid in respect of such
Loans pursuant to this Section 2.15, Section 2.16 or Section 2.21 would be
materially reduced or the taxes or other amounts otherwise payable under this
Section 2.15, Section 2.16 or Section 2.21 would be materially reduced, and if,
as determined by such Lender, in its sole reasonable discretion, the making,
funding or maintaining of such Loans through such other Lending Office would not
otherwise materially adversely affect such Loans.
(f) In the event any Lender shall have delivered to the Borrower a
notice that LIBOR Loans or B/As are no longer available from such Lender
pursuant to Section 2.16, that amounts are due to such Lender pursuant to
paragraph (c) above, that any of the events designated in paragraph (e) above
have occurred or that a Lender shall not be rated at least BBB by S&P and Baa2
by ▇▇▇▇▇'▇, the Borrower may (but subject in any such case to the payments
required by Section 2.17), provided that there shall exist no Default or Event
of Default, upon at least five Business Days' prior written or telecopier notice
to such Lender and the Administrative Agent, but not more than 30 days after
receipt of notice from such Lender, identify to the Administrative Agent a
lending institution reasonably acceptable to the Administrative Agent
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which will purchase the Commitment, the amount of outstanding Loans from the
Lender providing such notice and such Lender shall thereupon assign its
Commitment, any Loans owing to such Lender and the Notes held by such Lender to
such replacement lending institution pursuant to Section 9.3. Such notice shall
specify an effective date for such assignment and at the time thereof, the
Borrower shall pay all accrued interest, Facility Fees and all other amounts
(including without limitation all amounts payable under this Section and
Sections 2.21, 9.4 and 9.5) owing hereunder to such Lender as at such effective
date for such assignment.
SECTION 2.16. Change in Legality.
(a) Notwithstanding anything to the contrary herein contained, if any
change in any law or regulation or in the interpretation thereof by any
Governmental Authority charged with the administration or interpretation thereof
shall make it unlawful for any Lender to make or maintain any LIBOR Loan or B/A
or to give effect to its obligations as contemplated hereby, then, by written
notice to the Borrower or the Canadian Borrower, as applicable and to the
Administrative Agent and the Canadian Agent, as applicable, such Lender may:
(i) declare that LIBOR Loans or B/As will not thereafter be
made by such Lender hereunder, whereupon such Lender shall not submit a
Competitive Bid in response to a request for LIBOR Competitive Loans
and the Borrower and the Canadian Borrower shall be prohibited from
requesting LIBOR Revolving Credit Loans or B/As from such Lender
hereunder unless such declaration is subsequently withdrawn; and
(ii) require that all outstanding LIBOR Loans (in Dollars) or
B/As made by it be converted to ABR Loans or C$ Prime Rate Loans,
respectively, in which event (A) all such LIBOR Loans or B/As shall be
automatically converted to ABR Loans or C$ Prime Rate Loans,
respectively, as of the effective date of such notice as provided in
Section 2.16(b) and (B) all payments and prepayments of principal which
would otherwise have been applied to repay the converted LIBOR Loans or
B/As shall instead be applied to repay the ABR Loans or C$ Prime Rate
Loans, as the case may be resulting from the conversion of such LIBOR
Loans or B/As.
(b) For purposes of this Section 2.16, a notice to the Borrower or the
Canadian Borrower, as the case may be, by any Lender pursuant to Section 2.16(a)
shall be effective on the date of receipt thereof by the Borrower or the
Canadian Borrower, as the case may be.
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SECTION 2.17. Reimbursement of Lenders.
(a) The Borrower or the Canadian Borrower, as the case may be, shall
reimburse each Lender on demand for any loss incurred or to be incurred by it in
the reemployment of the funds released (i) by any prepayment (for any reason,
including any refinancing) of any LIBOR or Fixed Rate Loan or B/A if such Loan
is repaid other than on the last day of the applicable Interest Period or
Contract Period, as the case may be, for such Loan or (ii) in the event that
after the Borrower or the Canadian Borrower, as the case may be delivers a
notice of borrowing under Section 2.5 in respect of LIBOR Revolving Credit Loans
or a Competitive Bid Accept/Reject Letter under Section 2.4(d) or B/A, pursuant
to which it has accepted Competitive Bids of one or more of the Lenders, the
applicable Loan is not made on the first day of the Interest Period specified by
the Borrower or the Canadian Borrower, as the case may be for any reason other
than (I) a suspension or limitation under Section 2.16 of the right of the
Borrower or the Canadian Borrower, as the case may be, to select a LIBOR Loan or
B/A or (II) a breach by a Lender of its obligations hereunder. In the case of
such failure to borrow, such loss shall be the amount as reasonably determined
by such Lender as the excess, if any, of (A) the amount of interest which would
have accrued to such Lender on the amount not borrowed, at a rate of interest
equal to the interest rate applicable to such Loan pursuant to Section 2.9, for
the period from the date of such failure to borrow to the last day of the
Interest Period or Contract Period, as the case may be for such Loan which would
have commenced on the date of such failure to borrow, over (B) the amount
realized by such Lender in reemploying the funds not advanced during the period
referred to above. In the case of a payment other than on the last day of the
Interest Period or Contract Period, as the case may be for a Loan, such loss
shall be the amount as the excess, if any, of (A) the amount of interest which
would have accrued on the amount so paid at a rate of interest equal to the
interest rate applicable to such Loan pursuant to Section 2.9, for the period
from the date of such payment to the last day of the then current Interest
Period or Contract Period, as the case may be for such Loan, over (B) an amount
equal to the product of (x) the amount of the Loan so paid times (y) the current
daily yield on U.S. Treasury Securities or Canadian Treasury Securities, as the
case may be (at such date of determination) with maturities approximately equal
to the remaining Interest Period or Contract Period, as the case may be for such
Loan times (z) the number of days remaining in the Interest Period or Contract
Period, as the case may be for such Loan. Each Lender shall deliver to the
Borrower or the Canadian Borrower, as the case may be from time to time one or
more certificates setting forth the amount of such loss (and in reasonable
detail the manner of computation thereof) as determined by such Lender, which
certificates shall be conclusive absent manifest error. The Borrower or the
Canadian Borrower, as the case may be, shall pay to the Administrative Agent or
the Canadian Agent, as the case may be for the account of each Lender the amount
shown as due on any certificate within thirty (30) days after its receipt of the
same.
(b) In the event the Borrower or the Canadian Borrower, as the case may
be, fails to prepay any Loan on the date specified in any prepayment notice
delivered pursuant to Section 2.13(a), the Borrower or the Canadian Borrower, as
the case may be, on demand by any Lender shall pay to the Administrative Agent
or the Canadian Agent, as the case may be for the account
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of such Lender any amounts required to compensate such Lender for any loss
incurred by such Lender as a result of such failure to prepay, including,
without limitation, any loss, cost or expenses incurred by reason of the
acquisition of deposits or other funds by such Lender to fulfill deposit
obligations incurred in anticipation of such prepayment. Each Lender shall
deliver to the Borrower or the Canadian Borrower, as the case may be, and the
Administrative Agent or the Canadian Agent, as the case may be, from time to
time one or more certificates setting forth the amount of such loss (and in
reasonable detail the manner of computation thereof) as determined by such
Lender, which certificates shall be conclusive absent manifest error.
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SECTION 2.18. Pro Rata Treatment.
Except as permitted under Sections 2.14, 2.15(c), 2.15(f), 2.16, 2.17
and 2.24, (i) each Primary Borrowing, each reduction of the aggregate Primary
Commitments and each refinancing of any Borrowing with, or conversion of any
Borrowing to, a Primary Borrowing, or continuation of any Borrowing as a Primary
Borrowing, shall be allocated pro rata among the Primary Lenders in accordance
with their respective Primary Commitments (or, if such Primary Commitments shall
have expired or been terminated, in accordance with the respective principal
amount of their Primary Loans) and each payment or prepayment of principal of
any Primary Borrowing and each payment of interest on the Primary Loans shall be
allocated pro rata in accordance with the respective principal amount of the
Primary Loans then held by the Primary Lenders, (ii) each Pounds Sterling
Borrowing, each reduction of the aggregate Pounds Sterling Commitments and each
refinancing of any Borrowing with, or conversion of any Borrowing to, a Pounds
Sterling Borrowing, or continuation of any Borrowing as a Pounds Sterling
Borrowing, shall be allocated pro rata among the Pounds Sterling Lenders in
accordance with their respective Pounds Sterling Commitments (or, if such Pounds
Sterling Commitments shall have expired or been terminated, in accordance with
the respective principal amount of their outstanding Pounds Sterling Loans) and
each payment or prepayment of principal of any Pounds Sterling Borrowing and
each payment of interest on the Pounds Sterling Loans shall be allocated pro
rata in accordance with the respective principal amount of the Pounds Sterling
Loans then held by the Pounds Sterling Lenders and (iii) each Canadian
Borrowing, each reduction of the aggregate Canadian Commitments and each
refinancing of any Canadian Borrowing, or continuation of any Borrowing as a
Canadian Borrowing, shall be allocated pro rata among the Canadian Lenders in
accordance with their respective Canadian Commitments (or, if such Canadian
Commitments shall have expired or been terminated, in accordance with the
respective principal amount of their outstanding Canadian Revolving Credit
Loans) and each payment or prepayment of principal of any Canadian Borrowing and
each payment of interest on the Canadian Loans shall be allocated pro rata in
accordance with the respective principal amount of the Canadian Loans then held
by the Canadian Lenders. Each payment of principal of any Competitive Borrowing
shall be allocated pro rata among the Lenders participating in such Borrowing in
accordance with the respective principal amounts of their outstanding
Competitive Loans comprising such Borrowing. Each payment of interest on any
Competitive Borrowing shall be allocated pro rata among the Lenders
participating in such Borrowing in accordance with the respective amounts of
accrued and unpaid interest on their outstanding Competitive Loans comprising
such Borrowing. For purposes of determining the available Commitments of the
Lenders at any time, each outstanding Competitive Borrowing shall be deemed to
have utilized the Commitments of the Lenders (including those Lenders that shall
not have made Loans as part of such Competitive Borrowing) pro rata in
accordance with such respective Commitments. Each Lender agrees that in
computing such Lender's portion of any Borrowing to be made hereunder, the
Administrative Agent may, in its discretion, round each Lender's percentage of
such Borrowing computed in accordance with Section 2.1, to the next higher or
lower whole Dollar amount.
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SECTION 2.19. Right of Setoff.
If any Event of Default shall have occurred and be continuing and any
Lender shall have requested the Administrative Agent to declare the Loans
immediately due and payable pursuant to Article 7, each Lender is hereby
authorized at any time and from time to time, to the fullest extent permitted by
Applicable Law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by such Lender and any
other indebtedness at any time owing by such Lender to, or for the credit or the
account of, each Borrower, against any of and all the obligations now or
hereafter existing under this Agreement and the Loans held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement or such Loans and although such Obligations may be unmatured. Each
Lender agrees promptly to notify the Applicable Borrower after any such setoff
and application made by such Lender, but the failure to give such notice shall
not affect the validity of such setoff and application. The rights of each
Lender under this Section 2.19 are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have and are subject to
the provisions of Section 8.2.
SECTION 2.20. Manner of Payments.
(a) All payments by the Borrower hereunder and under the Notes shall be
made in Dollars or other applicable Currency in immediately available funds at
the office of the Administrative Agent's Agent Bank Services Department, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, for
credit to PHH Corporation Clearing Account, Account No. ▇▇▇-▇-▇▇▇▇▇ (Reference:
PHH Corporation Credit Agreement dated March 4, 1997) or as otherwise directed
by the Borrower (with the consent of the Administrative Agent, which consent
shall not be unreasonably withheld) no later than 4:30 p.m., New York City time,
on the date on which such payment shall be due. Interest in respect of any Loan
hereunder shall accrue from and including the date of such Loan to, but
excluding, the date on which such Loan is paid or refinanced with a Loan of a
different Interest Rate Type.
(b) All payments by the Canadian Borrower hereunder and under the
Canadian Revolving Credit Notes shall be made in Canadian Dollars in immediately
available funds at Royal Bank of Canada Swift Code ▇▇▇▇▇▇▇▇ for credit to PHH
Vehicle Management Services Inc. Clearing Account, Account No. ▇▇▇-▇▇▇-▇
Reference: PHH Vehicle Management Services Inc. Credit Agreement dated March 4,
1997) no later than 4:30 p.m., Toronto time, on the date on which such payment
shall be due. Interest in respect of any Canadian Revolving Credit Loan
hereunder shall accrue from and including the date of such Canadian Revolving
Credit Loan to, but excluding, the date on which such Canadian Revolving Credit
Loan is paid or refinanced with a Canadian Revolving Credit Loan of a different
Interest Rate Type.
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SECTION 2.21. Withholding Taxes.
(a) Prior to the date of the initial Loans hereunder, and from time to
time thereafter if requested by either of the Borrowers or the Applicable Agent
or required because, as a result of a change in Applicable Law or a change in
circumstances or otherwise, a previously delivered form or statement becomes
incomplete or incorrect in any material respect, each Lender organized under the
laws of a jurisdiction outside the United States or Canada, in the case of a
Canadian Lender, shall provide, if applicable, the Applicable Agents and the
Borrowers with complete, accurate and duly executed forms or other statements
prescribed by a Governmental Authority certifying such Lender's exemption, if
any, from, or entitlement to a reduced rate, if any, of, withholding taxes
(including backup withholding taxes) with respect to all payments to be made to
such Lender hereunder and under the Notes.
(b) The Borrowers and the Applicable Agents shall be entitled to deduct
and withhold any and all present or future taxes or withholdings, and all
liabilities with respect thereto, from payments hereunder or under the Notes, if
and to the extent that the Borrowers or the Applicable Agents in good faith
determine that such deduction or withholding is required by Applicable Law,
including, without limitation, any applicable treaty. In the event either of the
Borrowers or the Applicable Agents shall so determine that deduction or
withholding of taxes is required, it shall advise the affected Lender as to the
basis of such determination prior to actually deducting and withholding such
taxes. In the event either of the Borrowers or the Applicable Agents shall so
deduct or withhold taxes from amounts payable hereunder, it (i) shall pay to or
deposit with the appropriate taxing authority in a timely manner the full amount
of taxes it has deducted or withheld; (ii) shall provide evidence of payment of
such taxes to, or the deposit thereof with, the appropriate taxing authority and
a statement setting forth the amount of taxes deducted or withheld, the
applicable rate, and any other information or documentation reasonably requested
by the Lenders from whom the taxes were deducted or withheld; and (iii) shall
forward to such Lenders any receipt for such payment or deposit of the deducted
or withheld taxes as may be issued from time to time by the appropriate taxing
authority. Unless either of the Borrowers and the Applicable Agents have
received forms or other documents satisfactory to them indicating that payments
hereunder or under the Notes are not subject to withholding tax or are subject
to such tax at a rate reduced by an applicable tax treaty, the Borrowers or the
Applicable Agents may withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Lender.
(c) Each Lender agrees (i) that as between it and either of the
Borrowers or the Applicable Agents, it shall be the Person to deduct and
withhold taxes, and to the extent required by law it shall deduct and withhold
taxes, on amounts that such Lender may remit to any other Person(s) by reason of
any undisclosed transfer or assignment of an interest in this Agreement to such
other Person(s) pursuant to paragraph (g) of Section 9.3 and (ii) to indemnify
the Borrowers and the Applicable Agents and any of their officers, directors,
agents, or employees against, and to hold them harmless from, any tax, interest,
additions to tax, penalties, reasonable counsel and accountants' fees,
disbursements or payments arising from the assertion by any appropriate
-45-
taxing authority of any claim against them relating to a failure to withhold
taxes as required by Applicable Law with respect to amounts described in clause
(i) of this paragraph (c).
(d) Each assignee of a Lender's interest in this Agreement in
conformity with Section 9.3 shall be bound by this Section 2.21, so that such
assignee will have all of the obligations and provide all of the forms and
statements and all indemnities, representations and warranties required to be
given under this Section 2.21.
(e) In the event that any withholding taxes shall become payable as a
result of any change in any statute, treaty, ruling, determination or regulation
occurring after the Initial Date (as defined below) in respect of any sum
payable hereunder or under any other Fundamental Document to any Lender or
either of the Applicable Agents (i) the sum payable by either of the Borrowers
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 2.21) such Lender or the Applicable Agents (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Applicable Borrower shall make such deductions
and (iii) the Applicable Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with Applicable
Law. For purposes of this Section 2.21, the term "Initial Date" shall mean (i)
in the case of the Applicable Agents, the date hereof, (ii) in the case of each
Lender as of the date hereof, the date hereof and (iii) in the case of any other
Lender, the effective date of the Assignment and Acceptance pursuant to which it
became a Lender.
SECTION 2.22. Certain Pricing Adjustments.
The Facility Fee and the applicable LIBOR Spread and B/A Spread in
effect from time to time shall be determined in accordance with the following
table:
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Applicable
S&P/▇▇▇▇▇'▇ Rating Equivalent LIBOR Spread
of the Borrower's senior Facility Fee And B/A Spread
unsecured long-term debt (in Basis Points) (in Basis Points)
------------------------ ----------------- -----------------
AA-/Aa3 or better 4.0 14.75
A+/A1 5.0 15.00
A/A2 6.0 16.50
A-/A3 7.0 18.00
BBB+/Baa1 8.0 22.00
BBB/Baa2 10.0 25.00
BBB-/Baa3 12.5 37.50
BB+/Ba1 or worse 17.5 45.00
In the event the S&P rating on the Borrower's senior unsecured
long-term debt is not equivalent to the ▇▇▇▇▇'▇ rating on such debt, the higher
rating will determine the Facility Fee and applicable LIBOR Spread and B/A
Spread, unless the S&P and ▇▇▇▇▇'▇ ratings are more than one level apart, in
which case the rating one level below the higher rating will be determinative.
In the event that the Borrower's senior unsecured long-term debt is rated by
only one of S&P and ▇▇▇▇▇'▇ (for any reason, including if S&P or ▇▇▇▇▇'▇ shall
cease to be in the business of rating corporate debt obligations) or if the
rating system of either S&P or ▇▇▇▇▇'▇ shall change, then an amendment shall be
negotiated in good faith (and shall be effective only upon approval by the
Borrower and the Supermajority Lenders) to the references to specific ratings in
the table above to reflect such changed rating system or the unavailability of
ratings from such rating agency (including an amendment to provide for the
substitution of an equivalent or successor ratings agency). In the event that
the Borrower's senior unsecured long-term debt is not rated by either S&P or
▇▇▇▇▇'▇, then the Facility Fee and the applicable LIBOR Spread and B/A Spread
shall be deemed to be calculated as if the lowest rating category set forth
above applied. Any increase in the Facility Fee or the applicable LIBOR Spread
and B/A Spread determined in accordance with the foregoing table shall become
effective on the date of announcement or publication by the Borrower or either
such rating agency of a reduction in such rating or, in the absence of such
announcement or publication, on the effective date of such decreased rating, or
on the date of any request by the Borrower to either of such rating agencies not
to rate its senior unsecured long-term debt or on the date either of such rating
agencies announces it shall no longer rate the Borrower's senior unsecured
long-term debt. Any decrease in the Facility Fee or applicable LIBOR Spread and
B/A Spread shall be effective on the date of announcement or publication by
either of such rating agencies of an increase in rating or in the absence of
announcement or publication on the effective date of such increase in rating.
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SECTION 2.23. [Intentionally Deleted.]
SECTION 2.24. Extension of Maturity Date (a) Not less than 60 days and
not more than 90 days prior to the Maturity Date then in effect, provided that
no Event of Default shall have occurred and be continuing, the Borrower may
request an extension of the Maturity Date then in effect by submitting to the
Administrative Agent an Extension Request containing the information in respect
of such extension specified in Exhibit H, which the Administrative Agent shall
promptly furnish to each Lender. Each Lender shall, not less than 30 days and
not more than 60 days prior to such Maturity Date then in effect, notify the
Borrower and the Administrative Agent of its election to grant or not to grant
the extension as requested in such Extension Request. Notwithstanding any
provision of this Agreement to the contrary, any notice by any Lender of its
willingness to extend the Maturity Date shall be revocable by such Lender in its
sole and absolute discretion at any time prior to the date which is 30 days
prior to such Maturity Date then in effect. If the Supermajority Lenders shall
approve in writing the extension of the Maturity Date requested in such
Extension Request, the Maturity Date shall automatically and without any further
action by any Person be extended for the period specified in such Extension
Request; provided that (i) each extension pursuant to this Section 2.24 shall be
for a maximum of 364 days and (ii) the Commitment of any Lender which does not
consent in writing to such extension not less than 30 days and not more than 60
days prior to such Maturity Date then in effect (an "Objecting Lender") shall,
unless earlier terminated in accordance with this Agreement, expire on the
Maturity Date in effect on the date of such Extension Request (such Maturity
Date, if any, referred to as the "Commitment Expiration Date" with respect to
such Objecting Lender). If not less than 30 days and not more than 60 days prior
to such Maturity Date then in effect, the Supermajority Lenders shall not
approve in writing the extension of the Maturity Date requested in an Extension
Request, the Maturity Date shall not be extended pursuant to such Extension
Request. The Administrative Agent shall promptly notify (y) the Lenders and the
Borrower of any extension of the Maturity Date pursuant to this Section 2.24 and
(z) the Borrower and any other Lender of any Lender which becomes an Objecting
Lender.
(b) Loans (including any principal, interest, fees and other amounts
due hereunder) owing to any Objecting Lender on the Commitment Expiration Date
with respect to such Lender shall be repaid in full on or before such Commitment
Expiration Date.
(c) The Borrower shall have the right, so long as no Event of Default
has occurred and is then continuing, upon giving notice to the Administrative
Agent and the Objecting Lender in accordance with Section 2.13, to prepay in
full the Loans of the Objecting Lenders, together with accrued interest thereon,
any amounts payable pursuant to Sections 2.9, 2.10, 2.14, 2.15, 2.17, 2.21, 9.4
and 9.5 and any accrued and unpaid Facility Fee or other amounts payable to it
hereunder and/or, upon giving not less than three Business Days' notice to the
Objecting Lenders and the Administrative Agent, to cancel in whole or in part
the Commitments of the Objecting Lenders.
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(d) The Borrower may, with the consent of the Administrative Agent,
designate one or more financial institutions to act as a Lender hereunder in
place of any Objecting Lender, and upon the execution of an agreement
substantially in the form of Exhibit H by each such Objecting Lender (who hereby
agrees to execute such agreement), such replacement financial institution and
the Administrative Agent, such replacement financial institution shall become
and be a Lender hereunder with all the rights and obligations it would have had
if it had been named on the signature pages hereof, and having for all such
financial institutions aggregate Commitments of no greater than the whole of the
Commitment of the Objecting Lender in place of which such financial institutions
were designated; provided that the Facility Fees, interest and other payments to
the Lenders due hereunder shall accrue for the account of each such financial
institution from the date of replacement pursuant to such agreement. The
Administrative Agent shall notify the Lenders of the execution of any such
agreement, the name of the financial institution executing such agreement and
the amount of such financial institution's Commitment.
SECTION 2.25. Bankers' Acceptances. (a) Subject to the terms and
conditions of this Agreement, the Canadian Borrower may request a Borrowing by
presenting drafts for acceptance and purchase as B/As by the Canadian Lenders.
(b) No Contract Period with respect to a B/A shall extend beyond the
Maturity Date.
(c) To facilitate availment of the Borrowings by way of B/As, the
Canadian Borrower hereby appoints each Canadian Lender as its attorney to sign
and endorse on its behalf, in handwriting or by facsimile or mechanical
signature as and when deemed necessary by such Canadian Lender, blank forms of
B/As substantially in the form of Exhibit H. In this respect, it is each
Canadian Lender's responsibility to maintain an adequate supply of blank forms
of B/As for acceptance under this Agreement. The Canadian Borrower recognizes
and agrees that all B/As signed and/or endorsed on its behalf by a Canadian
Lender shall bind the Canadian Borrower as fully and effectually as if signed in
the handwriting of and duly issued by the proper signing officers of the
Canadian Borrower. Each Canadian Lender is hereby authorized to issue such B/As
endorsed in blank in such face amounts as may be determined by such Canadian
Lender; provided that the aggregate amount thereof is equal to the aggregate
amount of B/As required to be accepted and purchased by such Canadian Lender. No
Canadian Lender shall be liable for any damage, loss or other claim arising by
reason of any loss or improper use of any such instrument except the gross
negligence or wilful misconduct of the Canadian Lender or its officers,
employees, agents or representatives. Each Canadian Lender shall maintain a
record with respect to B/As (a) received by it from the Canadian Agent in blank
hereunder, (b) voided by it for any reason, (c) accepted and purchased by it
hereunder, and (d) cancelled at their respective maturities. Each Canadian
Lender further agrees to retain such records in the manner and for the statutory
periods provided in the various provincial or federal statutes and regulations
which apply to such Canadian Lender. Each Canadian Lender agrees to provide a
copy of such records to the Canadian Borrower at the Canadian Borrower's expense
upon request. On request by or on behalf of the Canadian Borrower, a Canadian
Lender shall cancel all forms of B/A
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which have been pre-signed or pre-endorsed on behalf of the Canadian Borrower
and which are held by the said Canadian Lender and are not required to be issued
in accordance with the Canadian Borrower's irrevocable notice.
(d) Drafts of the Canadian Borrower to be accepted as B/As hereunder
shall be signed as set forth in this Section 2.25. Notwithstanding that any
Person whose signature appears on any B/A may no longer be an authorized
signatory for any of the Canadian Lenders or the Canadian Borrower at the date
of issuance of a B/A, such signature shall nevertheless be valid and sufficient
for all purposes as if such authority had remained in force at the time of such
issuance and any such B/A so signed shall be binding on the Canadian Borrower.
(e) Promptly following receipt of a Notice of Canadian Borrowing or
Notice of Rollover or notice of refinancing pursuant to Section 2.6 by way of
B/As, the Canadian Agent shall so advise the Canadian Lenders and shall advise
each Canadian Lender of the aggregate face amount of the B/As to be accepted by
it and the applicable Contract Period (which shall be identical for all
Lenders). The aggregate face amount of the B/As to be accepted by a Canadian
Lender shall be a whole multiple of C$100,000, and such face amount shall be in
the Canadian Lenders pro rata portion of such Borrowing, provided that the
Canadian Agent may in its sole discretion increase or reduce each Canadian
Lender's portion of such Borrowing to the nearest C$100,000.
(f) Upon acceptance of a B/A by a Canadian Lender, such Canadian Lender
shall purchase, or arrange the purchase of, each B/A from the Canadian Borrower
at the Discount Rate for such Canadian Lender applicable to such B/A accepted by
it and provide to the Canadian Agent the Discount Proceeds for the account of
the Canadian Borrower. The Acceptance Fee payable by the Canadian Borrower to a
Canadian Lender under Section 2.9 in respect of each B/A accepted by such
Canadian Lender shall be set off against the Discount Proceeds payable by such
Canadian Lender under this Section 2.25.
(g) Each Canadian Lender may at any time and from time to time hold,
sell, rediscount or otherwise dispose of any or all B/As accepted and purchased
by it.
(h) With respect to each Borrowing which is outstanding hereunder by
way of B/As, at or before 11:00 a.m. two Business Days before the maturity date
of such B/As, the Canadian Borrower shall notify the Canadian Agent at the
Canadian Agent's address set forth in Section 9.1 by irrevocable telephone
notice, followed by a Notice of Rollover on the same day, if the Canadian
Borrower intends to issue B/As on such maturity date to provide for the payment
of such maturing B/As. If the Canadian Borrower fails to notify the Canadian
Agent of its intention to issue B/As on such maturity date, the Canadian
Borrower shall provide payment to the Canadian Agent on behalf of the Canadian
Lenders of an amount equal to the aggregate face amount of such B/As on the
maturity date of such B/As. If the Canadian Borrower fails to make such payment,
such maturing B/As shall be deemed to have been converted on their maturity date
into a C$ Prime Rate Loan in an amount equal to the face amount of such B/As and
the
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Canadian Borrower shall on demand pay any penalties that may have been incurred
by the Canadian Agent and any Canadian Lender due to the failure of the Canadian
Borrower to make such payment.
(i) The Canadian Borrower waives presentment for payment and any other
defense to payment of any amounts due to a Canadian Lender in respect of a B/A
accepted and purchased by it pursuant to this Agreement which might exist solely
by reason of such B/A being held, at the maturity thereof, by such Canadian
Lender in its own right and the Canadian Borrower agrees not to claim any days
of grace if such Canadian Lender as holder sues the Canadian Borrower on the B/A
for payment of the amount payable by the Canadian Borrower thereunder. On the
specified maturity date of a B/A, or such earlier date as may be required or
permitted pursuant to the provisions of this Agreement, the Canadian Borrower
shall pay the Canadian Lender that has accepted and purchased such B/A the full
face amount of such B/A and after such payment, the Canadian Borrower shall have
no further liability in respect of such B/A and such Canadian Lender shall be
entitled to all benefits of, and be responsible for all payments due to third
parties under, such B/A.
(j) If a Canadian Lender grants a participation in a portion of its
rights under this Agreement to a Participant, then in respect of any Borrowing
by way of Bankers' Acceptances, a portion thereof may, at the option of such
Canadian Lender, be by way of Bankers' Acceptance accepted by such Participant.
In such event, the Canadian Borrower shall upon request of the Canadian Agent or
the Canadian Lender granting the participation execute and deliver a form of
Bankers' Acceptance undertaking in favor of such Participant for delivery to
such Participant.
SECTION 2.26. Guarantee. (a) To induce the Agents and the Lenders to
execute and deliver this Agreement and to make or maintain the Canadian Loans
hereunder, and in consideration thereof, the Borrower hereby unconditionally and
irrevocably guarantees to the Agents, for the ratable benefit of the Lenders,
the prompt and complete payment and performance by the Canadian Borrower when
due (whether at stated maturity, by acceleration or otherwise) of the Canadian
Obligations, and the Borrower further agrees to pay any and all expenses
(including, without limitation, all reasonable fees, charges and disbursements
of counsel) which may be paid or incurred by the Agents or by the Lenders in
enforcing, or obtaining advice of counsel in respect of, any of their rights
under the guarantee contained in this Section 2.26. The guarantee contained in
this Section 2.26, subject to Section 2.26(e), shall remain in full force and
effect until the Canadian Obligations are paid in full and the Canadian
Commitments are terminated, notwithstanding that from time to time prior thereto
the Canadian Borrower may be free from any Canadian Obligations.
(b) Notwithstanding any payment or payments made by the Borrower
hereunder or any set-off or application of funds of the Borrower by any Lender,
the Borrower shall not be entitled to be subrogated to any of the rights of the
Agents or any Lender against the Canadian Borrower or any collateral security or
guarantee or right of offset held by any Lender for the payment of the Canadian
Obligations, nor shall the Borrower seek or be entitled to seek any
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contribution or reimbursement from the Canadian Borrower in respect of payments
made by the Borrower hereunder, until all amounts owing to the Agents and the
Lenders by the Canadian Borrower on account of the Canadian Obligations are paid
in full and the Canadian Commitments are terminated. If any amount shall be paid
to the Borrower on account of such subrogation rights at any time when all of
the Canadian Obligations shall not have been paid in full or the Canadian
Commitments shall not have been terminated, such amount shall be held by the
Borrower in trust for the Agents and the Lenders, segregated from other funds of
the Borrower, and shall, forthwith upon receipt by the Borrower, be turned over
to the Agents in the exact form received by the Borrower (duly endorsed by the
Borrower to the Administrative Agent, if required), to be applied against the
Canadian Obligations, whether matured or unmatured, in such order as the
Administrative Agent may determine. The Borrower hereby further irrevocably
waives all contractual, common law, statutory and other rights of reimbursement,
contribution, exoneration or indemnity (or any similar right) from or against
the Canadian Borrower or any other Person which may have arisen in connection
with the guarantee contained in this Section 2.26.
(c) The Borrower shall remain obligated under this Section 2.26
notwithstanding that, without any reservation of rights against the Borrower,
and without notice to or further assent by the Borrower, any demand for payment
of or reduction in the principal amount of any of the Canadian Obligations made
by either of the Agents or any Lender may be rescinded by either of the Agents
or such Lender, and any of the Canadian Obligations continued, and the Canadian
Obligations, or the liability of any other party upon or for any part thereof,
or any collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
either of the Agents or any Lender, and this Agreement, any other Fundamental
Document, and any other documents executed and delivered in connection therewith
may be amended, modified, supplemented or terminated, in whole or in part, as
the Lenders (or the Required Lenders, as the case may be) may deem advisable
from time to time, and any collateral security, guarantee or right of offset at
any time held by either of the Agents or any Lender for the payment of the
Canadian Obligations may be sold, exchanged, waived, surrendered or released.
Neither of the Agents nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Canadian Obligations or for the guarantee contained in this Section 2.26 or any
property subject thereto.
(d) The Borrower waives any and all notice of the creation, renewal,
extension or accrual of any of the Canadian Obligations and notice of or proof
of reliance by either of the Agents or any Lender upon the guarantee contained
in this Section 2.26 or acceptance of the guarantee contained in this Section
2.26; the Canadian Obligations, and any of them, shall conclusively be deemed to
have been created, contracted or incurred, or renewed, extended, amended or
waived, in reliance upon the guarantee contained in this Section 2.26; and all
dealings between the Canadian Borrower or the Borrower, on the one hand, and the
Agents and the Lenders, on the other, shall likewise be conclusively presumed to
have been had or consummated in reliance upon the guarantee contained in this
Section 2.26. The Borrower
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waives diligence, presentment, protest, demand for payment and notice of default
or nonpayment to or upon the Canadian Borrower or the Borrower with respect to
the Canadian Obligations. The guarantee contained in this Section 2.26 shall be
construed as a continuing, absolute and unconditional guarantee of payment
without regard to (i) the validity or enforceability of this Agreement, any
other Fundamental Document, any of the Canadian Obligations or any collateral
security therefor or guarantee or right of offset with respect thereto at any
time or from time to time held by either of the Agents or any Lender, (ii) any
defense, setoff or counterclaim (other than a defense of payment or performance)
which may at any time be available to or be asserted by any Borrower against
either of the Agents or any Lender, or (iii) any other circumstance whatsoever
(with or without notice to or knowledge of the Canadian Borrower or the
Borrower) which constitutes, or might be construed to constitute, an equitable
or legal discharge of the Canadian Borrower for the Canadian Obligations, or of
the Borrower under the guarantee contained in this Section 2.26, in bankruptcy
or in any other instance. When either of the Agents or any Lender is pursuing
its rights and remedies under this Section 2.26 against the Borrower, either of
the Agents or any Lender may, but shall be under no obligation to, pursue such
rights and remedies as it may have against the Canadian Borrower or any other
Person or against any collateral security or guarantee for the Canadian
Obligations or any right of offset with respect thereto, and any failure by
either of the Agents or any Lender to pursue such other rights or remedies or to
collect any payments from the Canadian Borrower or any such other Person or to
realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of the Canadian Borrower or any such other
Person or of any such collateral security, guarantee or right of offset, shall
not relieve the Borrower of any liability under this Section 2.26, and shall not
impair or affect the rights and remedies, whether express, implied or available
as a matter of law, of the Agents and the Lenders against the Borrower.
(e) The guarantee contained in this Section 2.26 shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any of the Canadian Obligations is rescinded or must otherwise
be restored or returned by either of the Agents or any Lender upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Canadian Borrower or upon or as a result of the appointment of a receiver,
intervenor or conservator of, or trustee or similar officer for, the Canadian
Borrower or any substantial part of its property, or otherwise, all as though
such payments had not been made.
(f) The Borrower hereby agrees that any payments in respect of the
Canadian Obligations pursuant to this Section 2.26 will be paid to the Canadian
Agent without setoff or counterclaim (other than a defense of payment or
performance) in Dollars at the office of the Canadian Agent specified in Section
9.1.
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3. REPRESENTATIONS AND WARRANTIES OF BORROWER
In order to induce the Lenders to enter into this Agreement and to make
the Loans, each of the Borrowers makes the following representations and
warranties to the Administrative Agent, the Canadian Agent and the Lenders, all
of which shall survive the execution and delivery of this Agreement, the
issuance of the Notes and the making of the Loans:
SECTION 3.1. Corporate Existence and Power.
The Borrower and its Subsidiaries have been duly organized and are
validly existing in good standing under the laws of their respective
jurisdictions of incorporation and are in good standing or have applied for
authority to operate as a foreign corporation in all jurisdictions where the
nature of their properties or business so requires it and where a failure to be
in good standing as a foreign corporation would have a Material Adverse Effect.
Each of the Borrowers has the corporate power to execute, deliver and perform
its obligations under this Agreement and the other Fundamental Documents and
other documents contemplated hereby and to borrow hereunder.
SECTION 3.2. Corporate Authority and No Violation.
The execution, delivery and performance of this Agreement and the other
Fundamental Documents and the borrowings hereunder (a) have been duly authorized
by all necessary corporate action on the part of the Borrowers, (b) will not
violate any provision of any Applicable Law applicable to the Borrower or any of
its Subsidiaries or any of their respective properties or assets, (c) will not
violate any provision of the Certificate of Incorporation or By-Laws of the
Borrower or any of its Subsidiaries, or any Contractual Obligation of the
Borrower or any of its Subsidiaries, (d) will not be in conflict with, result in
a breach of, or constitute (with due notice or lapse of time or both) a default
under, any material indenture, agreement, bond, note or instrument and (e) will
not result in the creation or imposition of any Lien upon any property or assets
of the Borrower or any of its Subsidiaries other than pursuant to this Agreement
or any other Fundamental Document.
SECTION 3.3. Governmental and Other Approval and Consents.
No action, consent or approval of, or registration or filing with, or
any other action by, any governmental agency, bureau, commission or court is
required in connection with the execution, delivery and performance (including
the making of borrowings) by the Borrowers of this Agreement or the other
Fundamental Documents.
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SECTION 3.4. Financial Statements of Borrower.
(a) The (i) audited consolidated financial statements of the Borrower
and its Consolidated Subsidiaries as of April 30, 1995 and April 30, 1996, and
(ii) unaudited consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of October 31, 1996, in each case, together with the related
unaudited statements of income, shareholders' equity and cash flows for the
periods then ended fairly present the financial position of the Borrower and its
Consolidated Subsidiaries as at the dates indicated and the results of
operations and cash flows for the periods indicated in conformity with GAAP
subject to normal year-end adjustments in the case of such quarterly financial
statements.
(b) Upon its delivery to the Lenders pursuant to Section 5.1(g), the
unaudited pro forma consolidated balance sheet of the Borrower as of a date
reasonably acceptable to the Administrative Agent (including the notes thereto)
(the "Pro Forma Balance Sheet"), has been prepared giving effect (as if such
events had occurred on such date) to (i) the Acquisition, (ii) the financings
and other transactions contemplated hereby to be made on or before the Closing
Date and the use of proceeds thereof and (iii) the payment of fees and expenses
in connection with the foregoing. The Pro Forma Balance Sheet has been prepared
based on the best information available to the Borrower as of the date of
delivery thereof and presents fairly on a pro forma basis the estimated
consolidated financial position of the Borrower as of such date, assuming that
the events specified in the preceding sentence had actually occurred at such
date.
SECTION 3.5. No Material Adverse Change.
Since April 30, 1996 there has been no material adverse change in the
business, assets, operations or condition, financial or otherwise, of the
Borrower and its Subsidiaries taken as a whole (provided that the Acquisition
shall not be deemed to be a material adverse change); provided that the
foregoing representation is made solely as of the Closing Date.
SECTION 3.6. Material Subsidiaries.
Annexed hereto as Schedule 3.6 is a correct and complete list as of the
date hereof of all Material Subsidiaries of the Borrower showing, as to each
Material Subsidiary, its name, the jurisdiction of its incorporation, its
authorized capitalization and the ownership of the capital stock of such
Material Subsidiary.
SECTION 3.7. Copyrights, Patents and Other Rights.
Each of the Borrower and its Subsidiaries owns, or is licensed to use,
all trademarks, tradenames, service marks, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Borrower and its Subsidiaries does not infringe upon the rights of any other
Person, except for any such infringements that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
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SECTION 3.8. Title to Properties.
Each of the Borrower and its Material Subsidiaries will have at the
Closing Date good title or valid leasehold interests to each of the properties
and assets reflected on the balance sheets referred to in Section 3.4, except
for minor defects in title that do not interfere with its ability to conduct its
business as currently conducted or to utilize such properties for their intended
purposes, and all such properties and assets will be free and clear of Liens,
except Permitted Encumbrances.
SECTION 3.9. Litigation.
There are no lawsuits or other proceedings pending (including, but not
limited to, matters relating to environmental liability), or, to the knowledge
of the Borrower, threatened, against or affecting the Borrower or any of its
Subsidiaries or any of their respective properties, by or before any
Governmental Authority or arbitrator, which could reasonably be expected to have
a Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries is
in default with respect to any order, writ, injunction, decree, rule or
regulation of any Governmental Authority, which default would have a Material
Adverse Effect.
SECTION 3.10. Federal Reserve Regulations.
Neither the Borrower nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the Loans will be used, whether immediately, incidentally or
ultimately, for any purpose violative of or inconsistent with any of the
provisions of Regulation G, T, U or X of the Board.
SECTION 3.11. Investment Company Act.
Neither of the Borrowers is, nor will during the term of this Agreement
be, (x) an "investment company", within the meaning of the Investment Company
Act of 1940, as amended or (y) subject to regulation under the Public Utility
Holding Company Act of 1935 or the Federal Power Act.
SECTION 3.12. Enforceability.
This Agreement and the other Fundamental Documents when executed will
constitute legal, valid and enforceable obligations (as applicable) of the
Borrowers (subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and to general principles of equity).
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SECTION 3.13. Taxes.
The Borrower and each of its Subsidiaries have filed or caused to be
filed all federal, provincial, state and local tax returns which are required to
be filed, and have paid or have caused to be paid all taxes as shown on said
returns or on any assessment received by them in writing, to the extent that
such taxes have become due, except (a) as permitted by Section 5.4 or (b) to the
extent that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 3.14. Compliance with ERISAA.
Each of the Borrower and its Subsidiaries is in compliance in all
material respects with the provisions of ERISA and the Code applicable to Plans,
and the regulations and published interpretations thereunder, if any, which are
applicable to it and the applicable laws, rules and regulations of any
jurisdiction applicable to Plans. Neither the Borrower nor any of its
Subsidiaries has, with respect to any Plan established or maintained by it,
engaged in a prohibited transaction which would subject it to a material tax or
penalty on prohibited transactions imposed by ERISA or Section 4975 of the Code.
No liability to the PBGC that is material to the Borrower and its Subsidiaries
taken as a whole has been, or to the Borrower's best knowledge is reasonably
expected to be, incurred with respect to the Plans and there has been no
Reportable Event and no other event or condition that presents a material risk
of termination of a Plan by the PBGC. Neither the Borrower nor any of its
Subsidiaries has engaged in a transaction which would result in the incurrence
of a material liability under Section 4069 of ERISA. As of the Closing Date,
neither the Borrower nor any of its Subsidiaries contributes to a Multiemployer
Plan, and has not incurred any liability that would be material to the Borrower
and its Subsidiaries taken as a whole on account of a partial or complete
withdrawal (as defined in Sections 4203 and 4205 of ERISA, respectively) with
respect to any Multiemployer Plan.
SECTION 3.15. Disclosure.
As of the Closing Date, neither this Agreement nor the Confidential
Information Memorandum dated February 1997, at the time it was furnished,
contained any untrue statement of a material fact or omitted to state a material
fact, under the circumstances under which it was made, necessary in order to
make the statements contained herein or therein not misleading. At the date
hereof, there is no fact known to the Borrowers which, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
(provided that the Acquisition shall not be deemed to be a material adverse
change).
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SECTION 3.16. Environmental Liabilities.
Except with respect to any matters, that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to
comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any Environmental Liability or (iv) knows of any basis for
any Environmental Liability.
4. CONDITIONS OF LENDING
SECTION 4.1. Conditions Precedent to Effectiveness.
The effectiveness of this Agreement is subject to the following
conditions precedent:
(a) Loan Documents. The Administrative Agent shall have
received this Agreement and each of the other Fundamental Documents,
each executed and delivered by a duly authorized officer of each of the
Borrowers party thereto.
(b) Corporate Documents for the Borrowers. The Administrative
Agent shall have received, with copies for each of the Lenders, a
certificate of the Secretary or Assistant Secretary of each of the
Borrowers dated the date hereof and certifying (A) that attached
thereto is a true and complete copy of the certificate of incorporation
and by-laws of such Borrower as in effect on the date of such
certification; (B) that attached thereto is a true and complete copy of
resolutions adopted by the Board of Directors of such Borrower
authorizing the borrowings hereunder and the execution, delivery and
performance in accordance with their respective terms of this Agreement
and any other documents required or contemplated hereunder; and (C) as
to the incumbency and specimen signature of each officer of such
Borrower executing this Agreement or any other document delivered by it
in connection herewith (such certificate to contain a certification by
another officer of such Borrower as to the incumbency and signature of
the officer signing the certificate referred to in this paragraph (b)).
(c) Financial Statements. The Lenders shall have received the
(i) audited consolidated financial statements of the Borrower and its
Consolidated Subsidiaries as of and for the period ended April 30, 1995
and April 30, 1996 and (ii) unaudited consolidated financial statements
of the Borrower and its Consolidated Subsidiaries as of and for the
period ended October 31, 1996.
(d) Opinions of Counsel. The Administrative Agent shall have
received the favorable written opinions, dated the date hereof and
addressed to the Agents and the
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Lenders, of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Assistant General Counsel of PHH
Corporation, Piper & Marbury, counsel to the Borrowers and of Blake,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, substantially in the form of Exhibits B-1 and B-2
and B-3 hereto respectively.
(e) No Material Adverse Change. The Administrative Agent shall
be satisfied that no material adverse change shall have occurred with
respect to the business, assets, operations or condition, financial or
otherwise, of the Borrower and its Consolidated Subsidiaries, taken as
a whole, since April 30, 1996 (provided that the Acquisition shall not
be deemed to be a material adverse change).
(f) Payment of Fees. The Administrative Agent shall be
satisfied that all amounts payable to the Arranger, the Agents and the
other Lenders pursuant hereto or with regard to the transactions
contemplated hereby have been or are simultaneously being paid.
(g) Litigation. No litigation shall be pending or, to the
Borrower's knowledge, threatened which would be likely to have a
Material Adverse Effect, or which could reasonably be expected to
materially adversely affect the ability of the Borrowers to fulfill
their obligations hereunder or to otherwise materially impair the
interests of the Lenders.
(h) Existing Credit Agreements. Prior to or simultaneously
with the Closing Date, all obligations under the master 3-year and
364-day committed existing credit agreements of the Borrowers shall
have been paid in full and the commitments of the lenders thereunder
shall have been terminated.
(i) Officer's Certificate. The Administrative Agent shall have
received a certificate of the chief executive officer or chief
financial officer or chief accounting officer of each of the Borrowers
certifying, as of the Closing Date, compliance with the conditions set
forth in paragraphs (b) and (c) of Section 4.2.
The Administrative Agent shall provide the Borrower with written confirmation of
the satisfaction of the conditions precedent specified in this Section 4.1.
SECTION 4.2. Conditions Precedent to Each Loan.
The obligation of the Lenders to make each Loan, including the initial
Loan hereunder, is subject to the following conditions precedent:
(a) Notice. The Administrative Agent and the Canadian Agent
shall have received a notice with respect to such Borrowing as required
by Article 2 hereof.
(b) Representations and Warranties. The representations and
warranties set forth in Article 3 (other than those set forth in
Section 3.5, which shall be deemed made only
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on the Closing Date) and in the other Fundamental Documents shall be
true and correct in all material respects on and as of the date of each
Borrowing hereunder (except to the extent that such representations and
warranties expressly relate to an earlier date) with the same effect as
if made on and as of such date; provided that this condition shall not
apply to a Revolving Credit Borrowing which is solely refinancing
outstanding Revolving Credit Loans and which, after giving effect
thereto, has not increased the aggregate amount of outstanding
Revolving Credit Loans.
(c) No Event of Default. On the date of each Borrowing
hereunder, the Borrowers shall be in material compliance with all of
the terms and provisions set forth herein to be observed or performed
and no Event of Default or Default shall have occurred and be
continuing; provided that this condition shall not apply to a Revolving
Credit Borrowing which is solely refinancing outstanding Revolving
Credit Loans and which, after giving effect thereto, has not increased
the aggregate amount of outstanding Revolving Credit Loans.
Each Borrowing shall be deemed to be a representation and warranty by the
Borrowers on the date of such Borrowing as to the matters specified in
paragraphs (b) and (c) of this Section.
5. AFFIRMATIVE COVENANTS
For so long as the Commitments shall be in effect or any amount shall
remain outstanding under any Note or unpaid under this Agreement, the Borrower
agrees that, unless the Required Lenders shall otherwise consent in writing, it
will, and will cause each of its Subsidiaries to:
SECTION 5.1. Financial Statements, Reports, etc.
Deliver to each Lender:
(a) As soon as is practicable, but in any event within 90 days
after the end of each fiscal year of the Borrower, (i) either (A)
consolidated statements of income (or operations) and consolidated
statements of cash flows and changes in stockholders' equity of the
Borrower and its Consolidated Subsidiaries for such year and the
related consolidated balance sheets as at the end of such year, or (B)
the Form 10K filed by the Borrower with the Securities and Exchange
Commission and (ii) if not included in such Form 10K, an opinion of
independent certified public accountants of recognized national
standing, which opinion shall state that said consolidated financial
statements fairly present the consolidated financial position and
results of operations of the Borrower and its Consolidated Subsidiaries
as at the end of, and for, such fiscal year and that such financial
statements were prepared in accordance with GAAP applied consistently
throughout the periods reflected therein and with prior periods;
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(b) Commencing with the quarter ending June 30, 1997 and as
soon as is practicable, but in any event within 60 days after the end
of each of the first three fiscal quarters of each fiscal year, either
(i) the Form 10-Q filed by the Borrower with the Securities and
Exchange Commission or (ii) the unaudited consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries, as at the end of, and
the related unaudited statements of income and cash flows for such
quarter and for the period from the beginning of the then current
fiscal year to the end of such fiscal quarter and the corresponding
figures as of the end of the preceding fiscal year, and for the
corresponding period in the preceding fiscal year, in each case,
together with a certificate (substantially in the form of Exhibit D)
signed by the chief financial officer, the chief accounting officer or
a vice president responsible for financial administration of the
Borrower to the effect that such financial statements, while not
examined by independent public accountants, reflect, in his opinion and
in the opinion of the Borrower, all adjustments necessary to present
fairly the financial position of the Borrower and its Consolidated
Subsidiaries, as the case may be, as at the end of the fiscal quarter
and the results of their operations for the quarter then ended in
conformity with GAAP consistently applied, subject only to year-end and
audit adjustments and to the absence of footnote disclosure;
(c) Together with the delivery of the statements referred to
in paragraphs (a) and (b) of this Section 5.1, a certificate of the
chief financial officer, chief accounting officer or a vice president
responsible for financial administration of the Borrower, substantially
in the form of Exhibit D hereto (i) stating whether or not the signer
has knowledge of any Default or Event of Default and, if so, specifying
each such Default or Event of Default of which the signer has knowledge
and the nature thereof and (ii) demonstrating in reasonable detail
compliance with the provisions of Sections 6.7 and 6.8;
(d) Promptly upon their becoming available, copies of all
financial statements, reports, notices and proxy statements sent or
made available by the Borrower or any of its Subsidiaries to its
shareholders generally, of all regular and periodic reports and all
registration statements and prospectuses, if any, filed by any of them
with any securities exchange or with the Securities and Exchange
Commission, or any comparable foreign bodies, and of all press releases
and other statements made available generally by any of them to the
public concerning material developments in the business of the Borrower
or any of its Subsidiaries;
(e) Promptly upon any executive officer of the Borrower or any
of its Subsidiaries obtaining knowledge of the occurrence of any
Default or Event of Default, a certificate of the president, chief
financial officer or chief accounting officer of the Borrower
specifying the nature and period of existence of such Default or Event
of Default and what action the Borrower has taken, is taking and
proposes to take with respect thereto;
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(f) Promptly upon any executive officer of the Borrower or any
of its Subsidiaries obtaining knowledge of (i) the institution of any
action, suit, proceeding, investigation or arbitration by any
Governmental Authority or other Person against or affecting the
Borrower or any of its Subsidiaries or any of their assets, or (ii) any
material development in any such action, suit, proceeding,
investigation or arbitration (whether or not previously disclosed to
the Lenders), which, in each case might reasonably be expected to have
a Material Adverse Effect, prompt notice thereof and such other
information as may be reasonably available to it (without waiver of any
applicable evidentiary privilege) to enable the Lenders to evaluate
such matters; and
(g) As soon as available, the Pro Forma Balance Sheet.
SECTION 5.2. Corporate Existence; Compliance with Statutes.
Do or cause to be done all things necessary to preserve, renew and keep
in full force and effect its corporate existence, rights, licenses, permits and
franchises and comply, except where failure to comply, either individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect, with all provisions of Applicable Law, and all applicable restrictions
imposed by any Governmental Authority, and all state and provincial laws and
regulations of similar import; provided that mergers, dissolutions and
liquidations permitted under Section 6.4 shall be permitted.
SECTION 5.3. Insurance.
Maintain with good and reputable insurers insurance in such amounts and
against such risks as are customarily insured against by companies in similar
businesses; provided however, that (a) workmen's compensation insurance or
similar coverage may be effected with respect to its operations in any
particular state or other jurisdiction through an insurance fund operated by
such state or jurisdiction and (b) such insurance may contain self-insurance
retention and deductible levels consistent as such insurance is usually carried
by companies of established reputation and comparable size.
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SECTION 5.4. Taxes and Charges.
Duly pay and discharge, or cause to be paid and discharged, before the
same shall become delinquent, all federal, state or local taxes, assessments,
levies and other governmental charges, imposed upon the Borrower or any of its
Subsidiaries or their respective properties, sales and activities, or any part
thereof, or upon the income or profits therefrom, as well as all claims for
labor, materials, or supplies which if unpaid could reasonably be expected to
result in a Material Adverse Effect; provided that any such tax, assessment,
charge, levy or claim need not be paid if the validity or amount thereof shall
currently be contested in good faith by appropriate proceedings and if the
Borrower shall have set aside on its books reserves (the presentation of which
is segregated to the extent required by GAAP) adequate with respect thereto if
reserves shall be deemed necessary by the Borrower in accordance with GAAP; and
provided, further, that the Borrower will pay all such taxes, assessments,
levies or other governmental charges forthwith upon the commencement of
proceedings to foreclose any Lien which may have attached as security therefor
(unless the same is fully bonded or otherwise effectively stayed).
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SECTION 5.5. ERISA Compliance and Reports.
Furnish to the Administrative Agent (a) as soon as possible, and in any
event within 30 days after any executive officer (as defined in Regulation C
under the Securities Act of 1933, as amended) of the Borrower knows that (i) any
Reportable Event with respect to any Plan has occurred, a statement of the chief
financial officer of the Borrower, setting forth details as to such Reportable
Event and the action which it proposes to take with respect thereto, together
with a copy of the notice, if any, required to be filed by the Borrower or any
of its Subsidiaries of such Reportable Event with the PBGC or (ii) an
accumulated funding deficiency has been incurred or an application has been made
to the Secretary of the Treasury for a waiver or modification of the minimum
funding standard or an extension of any amortization period under Section 412 of
the Code with respect to a Plan, a Plan has been or is proposed to be terminated
in a "distress termination" (as defined in Section 4041(c) of ERISA),
proceedings have been instituted to terminate a Plan or a Multiemployer Plan, a
proceeding has been instituted to collect a delinquent contribution to a Plan or
a Multiemployer Plan, or either the Borrower or any of its Subsidiaries will
incur any liability (including any contingent or secondary liability) to or on
account of the termination of or withdrawal from a Plan under Section 4062, 4063
or 4064 of ERISA or the withdrawal or partial withdrawal from a Multiemployer
Plan under Section 4201 or 4204 of ERISA, a statement of the chief financial
officer of the Borrower, setting forth details as to such event and the action
it proposes to take with respect thereto, (b) promptly upon the reasonable
request of the Administrative Agent, copies of each annual and other report with
respect to each Plan and (c) promptly after receipt thereof, a copy of any
notice the Borrower or any of its Subsidiaries may receive from the PBGC
relating to the PBGC's intention to terminate any Plan or to appoint a trustee
to administer any Plan; provided that the Borrower shall not be required to
notify the Administrative Agent of the occurrence of any of the events set forth
in the preceding clauses (a) and (c) unless such event, individually or in the
aggregate, could reasonably be expected to result in a material liability to the
Borrower and its Subsidiaries taken as a whole.
SECTION 5.6. Maintenance of and Access to Books and Records;
Examinations.
Maintain or cause to be maintained at all times true and complete books
and records of its financial operations (in accordance with GAAP) and, after the
occurrence and during the continuance of an Event of Default (at a time during
which Loans are outstanding), provide the Administrative Agent and its
representatives access to all such books and records and to any of their
properties or assets during regular business hours, in order that the
Administrative Agent may make such audits and examinations and make abstracts
from such books, accounts and records and may discuss the affairs, finances and
accounts with, and be advised as to the same by, officers and independent
accountants, all as the Administrative Agent may deem appropriate for the
purpose of verifying the various reports delivered pursuant to this Agreement or
for otherwise ascertaining compliance with this Agreement.
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SECTION 5.7. Maintenance of Properties.
Keep its properties which are material to its business in good repair,
working order and condition consistent with companies of established reputation
and comparable size.
6. NEGATIVE COVENANTS
For so long as the Commitments shall be in effect or any amount shall
remain outstanding under any Note or unpaid under this Agreement, unless the
Required Lenders shall otherwise consent in writing, the Borrower agrees that it
will not, nor will it permit any of its Subsidiaries to, directly or indirectly:
SECTION 6.1. Limitation on Material Subsidiary Indebtedness.
Incur, assume or suffer to exist any Indebtedness of any Material
Subsidiary which principally transacts business in the United States, except:
(a) Indebtedness in existence on the date hereof, or required
to be incurred pursuant to a contractual obligation in existence on the
date hereof, which in either case (to the extent not otherwise
permitted by paragraphs (b)-(g) of this Section 6.1), is listed on
Schedule 6.1 hereto, but not any extensions or renewals thereof, unless
effected on substantially the same terms or on terms not more adverse
to the Lenders;
(b) purchase money Indebtedness (including Capital Leases) to
the extent permitted under Section 6.5(b);
(c) Indebtedness owing by any Material Subsidiary to the
Borrower or any other Subsidiary;
(d) Indebtedness of any Material Subsidiary of the Borrower
issued and outstanding prior to the date on which such Subsidiary
became a Subsidiary of the Borrower (other than Indebtedness issued in
connection with, or in anticipation of, such Subsidiary becoming a
Subsidiary of the Borrower); provided that immediately prior and on a
Pro Forma Basis after giving effect to, such Person becoming a
Subsidiary of the Borrower, no Default or Event of Default shall occur
or then be continuing and the aggregate principal amount of such
Indebtedness, when added to the aggregate outstanding principal amount
of Indebtedness permitted by paragraphs (e) and (f) below, shall not
exceed $125,000,000;
(e) any renewal, extension or modification of Indebtedness
under paragraph (d) above so long (i) as such renewal, extension or
modification is effected on substantially the same terms or on terms
which, in the aggregate, are not more adverse to the Lenders and (ii)
the principal amount of such Indebtedness is not increased;
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(f) other Indebtedness of any Material Subsidiary in an
aggregate principal amount which, when added to the aggregate
outstanding principal amount of Indebtedness permitted by paragraphs
(d) and (e) above, does not exceed $125,000,000; and
(g) Indebtedness of Special Purpose Vehicle Subsidiaries
incurred to finance investment in lease agreements and vehicles by such
Subsidiaries, so long as the lender (and any other party) in respect of
such Indebtedness has recourse, if any, solely to the assets of such
Special Purpose Vehicle Subsidiary.
SECTION 6.2. [Intentionally deleted].
SECTION 6.3. Limitation on Transactions with Affiliates.
Enter into any transaction, including, without limitation, any purchase, sale,
lease or exchange of property or the rendering of any service, with any
Affiliate ( other than the Borrower or a wholly-owned Subsidiary of the
Borrower) unless such transaction is (a) otherwise permitted under this
Agreement, (b) in the ordinary course of the Borrower's or such Subsidiary's
business and (c) upon fair and reasonable terms no less favorable to the
Borrower or such Subsidiary, as the case may be, than it would obtain in
a comparable arm's length transaction with a Person which is not an Affiliate.
SECTION 6.4. Consolidation, Merger, Sale of Assets.
(a) Neither the Borrower nor any of its Material Subsidiaries
(in one transaction or series of transactions) will wind up, liquidate or
dissolve its affairs, or enter into any transaction of merger or consolidation,
except any merger, consolidation, dissolution or liquidation (i) in which the
Borrower is the surviving entity or if the Borrower is not a party to such
transaction then a Subsidiary is the surviving entity, (ii) in which the
surviving entity becomes a Subsidiary of the Borrower immediately upon the
effectiveness of such merger, consolidation, dissolution or liquidation or (iii)
in connection with a transaction permitted by Section 6.4(b); provided that
immediately prior to and on a Pro Forma Basis after giving effect to such
transaction no Default or Event of Default has occurred or is continuing.
(b) Sell or otherwise dispose of all or substantially all of
the assets of the Borrower and its Subsidiaries, taken as a whole, other than
pursuant to the Acquisition; provided that it is understood for purposes of
clarity that this Section 6.4(b) shall not prohibit or limit in any respect
transactions in the ordinary course of business of the Borrower or any of its
Subsidiaries (including but not limited to asset securitization transactions
entered into in the ordinary course of business).
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SECTION 6.5. Limitations on Liens.
Suffer any Lien on the property of the Borrower or any of the
Material Subsidiaries which principally transact business in the United States,
except:
(a) deposits under worker's compensation, unemployment
insurance and social security laws or to secure statutory obligations
or surety or appeal bonds or performance or other similar bonds in the
ordinary course of business, or statutory Liens of landlords, carriers,
warehousemen, mechanics and materialmen and other similar Liens, in
respect of liabilities which are not yet due or which are being
contested in good faith, Liens for taxes not yet due and payable, and
Liens for taxes due and payable, the validity or amount of which is
currently being contested in good faith by appropriate proceedings and
as to which foreclosure and other enforcement proceedings shall not
have been commenced (unless fully bonded or otherwise effectively
stayed);
(b) purchase money Liens granted to the vendor or Person
financing the acquisition of property, plant or equipment if (i)
limited to the specific assets acquired and, in the case of tangible
assets, other property which is an improvement to or is acquired for
specific use in connection with such acquired property or which is real
property being improved by such acquired property; (ii) the debt
secured by such Lien is the unpaid balance of the acquisition cost of
the specific assets on which the Lien is granted; and (iii) such
transaction does not otherwise violate this Agreement;
(c) Liens upon real and/or personal property, which property
was acquired after the date of this Agreement (by purchase,
construction or otherwise) by the Borrower or any of its Material
Subsidiaries, each of which Liens existed on such property before the
time of its acquisition and was not created in anticipation thereof;
provided that no such Lien shall extend to or cover any property of the
Borrower or such Material Subsidiary other than the respective property
so acquired and improvements thereon;
(d) Liens arising out of attachments, judgments or awards as
to which an appeal or other appropriate proceedings for contest or
review are promptly commenced (and as to which foreclosure and other
enforcement proceedings (i) shall not have been commenced (unless fully
bonded or otherwise effectively stayed) or (ii) in any event shall be
promptly fully bonded or otherwise effectively stayed);
(e) Liens created under any Fundamental Document as
contemplated by this Agreement;
(f) Liens securing Indebtedness of any Material Subsidiary to
the Borrower;
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(g) Liens covering only the property or other assets of any
Special Purpose Vehicle Subsidiary and securing only such Indebtedness
of such Special Purpose Vehicle Subsidiary as is permitted by paragraph
(g) of Section 6.1;
(h) mortgage liens existing on homes acquired by the Borrower
or any of its Material Subsidiaries in the ordinary course of their
relocation management business;
(i) other Liens incidental to the conduct of its business or
the ownership of its property and other assets, which do not secure any
Indebtedness and did not otherwise arise in connection with the
borrowing of money or the obtaining of advances or credit and which do
not, in the aggregate, materially detract from the value of its
property or other assets or materially impair the use thereof in the
operation of its business;
(j) Liens covering only the property or other assets of any
Subsidiary which principally transacts business outside of the United
States; and
(k) to the extent not otherwise permitted by paragraphs
(a)-(j) of this Section 6.5, Liens existing on the date hereof listed
on Schedule 6.5 hereto and any extensions or renewals thereof.
SECTION 6.6. Sale and Leaseback.
Enter into any arrangement with any Person or Persons, whereby
in contemporaneous transactions the Borrower or any of its Subsidiaries sells
essentially all of its right, title and interest in a material asset and the
Borrower or any of its Subsidiaries acquires or leases back the right to use
such property except that the Borrower may enter into sale-leaseback
transactions relating to assets not in excess of $100,000,000 in the aggregate
on a cumulative basis.
SECTION 6.7. Consolidated Net Worth.
Permit Consolidated Net Worth on the last day of any fiscal
quarter to be less than the greater of (a) the sum of (i) 70% of Consolidated
Net Worth on the first calendar quarter-end following the Acquisition plus (ii)
25% of Consolidated Net Income, if positive, for each fiscal quarter after the
first fiscal quarter-end following the Acquisition or (b) $400,000,000.
SECTION 6.8. Ratio of Indebtedness To Consolidated Net Worth.
Permit, at any time, Indebtedness of the Borrower and its
Subsidiaries less Cash Equivalents (owned by the Borrower or any of its
Subsidiaries and free of Liens (other than Liens securing Indebtedness)) to
exceed ten (10) times Consolidated Net Worth.
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SECTION 6.9. Accounting Practices.
Establish a fiscal year ending on other than December 31, or
modify or change accounting treatments or reporting practices except as
otherwise required or permitted by GAAP.
SECTION 6.10. Restrictions Affecting Subsidiaries.
Enter into, or suffer to exist, any Contractual Obligation
with any Person, which prohibits or limits the ability of any Subsidiary (other
than Special Purpose Vehicle Subsidiaries) to (a) pay dividends or make other
distributions or pay any Indebtedness owed to the Borrower or any other
Subsidiary, (b) make loans or advances to the Borrower or any other Subsidiary
or (c) transfer any of its properties or assets to the Borrower or any other
Subsidiary.
7. EVENTS OF DEFAULT
In the case of the happening and during the continuance of any
of the following events (herein called "Events of Default"):
(a) any representation or warranty made or deemed made by
either of the Borrowers in this Agreement or any other Fundamental
Document or in connection with this Agreement or with the execution and
delivery of the Notes or the Borrowings hereunder, or any statement or
representation made in any report, financial statement, certificate or
other document furnished by or on behalf of either of the Borrowers or
any of its Subsidiaries to the Administrative Agent or the Canadian
Agent or any Lender under or in connection with this Agreement, shall
prove to have been false or misleading in any material respect when
made or delivered;
(b) default shall be made in the payment of any principal of
or interest on the Notes or of any fees or other amounts payable by
either of the Borrowers hereunder, when and as the same shall become
due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise, and in the
case of payments of interest, such default shall continue unremedied
for five Business Days, and in the case of payments other than of any
principal amount of or interest on the Notes, such default shall
continue unremedied for five Business Days after receipt by the
Borrower of an invoice therefor;
(c) default shall be made in the due observance or performance
of any covenant, condition or agreement contained in Section 5.1(e)
(with respect to notice of Default or Events of Default) or Article 6;
(d) default shall be made by either of the Borrowers in the
due observance or performance of any other covenant, condition or
agreement to be observed or performed pursuant to the terms of this
Agreement or any other Fundamental Document and such
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default shall continue unremedied for thirty (30) days after such
Borrower obtains knowledge of such occurrence;
(e) (i) default in payment shall be made with respect to any
Indebtedness or Interest Rate Protection Agreements of the Borrower or
any of its Subsidiaries where the amount or amounts of such
Indebtedness exceeds $25,000,000 (or its equivalent thereof in any
other currency) in the aggregate; or (ii) default in payment or
performance shall be made with respect to any Indebtedness or Interest
Rate Protection Agreements of the Borrower or any of its Subsidiaries
where the amount or amounts of such Indebtedness or Interest Rate
Protection Agreements exceeds $25,000,000 (or its equivalent thereof in
any other currency) in the aggregate, if the effect of such default is
to result in the acceleration of the maturity of such Indebtedness or
Interest Rate Protection Agreement; or (iii) any other circumstance
shall arise (other than the mere passage of time) by reason of which
the Borrower or any Subsidiary of the Borrower is required to redeem or
repurchase, or offer to holders the opportunity to have redeemed or
repurchased, any such Indebtedness or Interest Rate Protection
Agreement where the amount or amounts of such Indebtedness or Interest
Rate Protection Agreement exceeds $25,000,000 (or its equivalent
thereof in any other currency) in the aggregate; provided that clause
(iii) shall not apply to secured Indebtedness or Interest Rate
Protection Agreement that becomes due as a result of a voluntary sale
of the property or assets securing such Indebtedness or Interest Rate
Protection Agreement and provided, further, that clauses (ii) and (iii)
shall not apply to any Indebtedness or Interest Rate Protection
Agreement of any Subsidiary issued and outstanding prior to the date
such Subsidiary became a Subsidiary of the Borrower (other than
Indebtedness or Interest Rate Protection Agreement issued in connection
with, or in anticipation of, such Subsidiary becoming a Subsidiary of
the Borrower) if such default or circumstance arises solely as a result
of a "change of control" provision applicable to such Indebtedness or
Interest Rate Protection Agreement which becomes operative as a result
of the acquisition of such Subsidiary by the Borrower or any of its
Subsidiaries;
(f) the Borrower or any of its Material Subsidiaries shall
generally not pay its debts as they become due or shall admit in
writing its inability to pay its debts, or shall make a general
assignment for the benefit of creditors; or the Borrower or any of its
Material Subsidiaries shall commence any case, proceeding or other
action seeking to have an order for relief entered on its behalf as
debtor or to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors or seeking appointment
of a receiver, trustee, custodian or other similar official for it or
for all or any substantial part of its property or shall file an answer
or other pleading in any such case, proceeding or other action
admitting the material allegations of any petition, complaint or
similar pleading filed against it or consenting to the relief sought
therein; or the Borrower or any Material Subsidiary thereof shall take
any action to authorize any of the foregoing;
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(g) any involuntary case, proceeding or other action against
the Borrower or any of its Material Subsidiaries shall be commenced
seeking to have an order for relief entered against it as debtor or to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, liquidation, dissolution or composition of it
or its debts under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking appointment of a
receiver, trustee, custodian or other similar official for it or for
all or any substantial part of its property, and such case, proceeding
or other action (i) results in the entry of any order for relief
against it or (ii) shall remain undismissed for a period of sixty (60)
days;
(h) the occurrence of a Change in Control subsequent to the
Acquisition (provided that, until the Acquisition is consummated and if
the Acquisition is not consummated, the definition of "Change in
Control" shall be deemed amended on such date such that (i) all
references therein to "HFS Incorporated" shall be deemed to be
references to "the Borrower" and (ii) clause (iii) of such definition
shall be deleted in its entirety);
(i) final judgment(s) for the payment of money in excess of
$25,000,000 (or its equivalent thereof in any other currency) shall be
rendered against the Borrower or any of its Subsidiaries which within
thirty (30) days from the entry of such judgment shall not have been
discharged or stayed pending appeal or which shall not have been
discharged within thirty (30) days from the entry of a final order of
affirmance on appeal;
(j) a Reportable Event relating to a failure to meet minimum
funding standards or an inability to pay benefits when due shall have
occurred with respect to any Plan under the control of the Borrower or
any of its Subsidiaries and shall not have been remedied within 45 days
after the occurrence of such Reportable Event, if the occurrence
thereof could reasonably be expected to have a Material Adverse Effect;
or
(k) any provision of Section 2.26 shall cease, for any reason,
to be in full force and effect, or either of the Borrowers or any
Affiliate of either of the Borrowers shall so assert;
then, in every such event and at any time thereafter during the continuance of
such event, the Administrative Agent may or, if directed by the Required
Lenders, shall take either or both of the following actions, at the same or
different times: terminate forthwith the Commitments and/or declare the
principal of and the interest on the Loans and the Notes and all other amounts
payable hereunder or thereunder to be forthwith due and payable, whereupon the
same shall become and be forthwith due and payable, without presentment, demand,
protest, notice of acceleration, notice of intent to accelerate or other notice
of any kind, all of which are hereby expressly waived, anything in this
Agreement or in the Notes to the contrary notwithstanding; provided that, in the
case of a payment of principal default pursuant to paragraph (b), the
Administrative Agent, unless it is directed to do so by the Required Lenders,
will not take either or both of such
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actions for three Business Days. If an Event of Default specified in paragraph
(f) or (g) above shall have occurred, the principal of and interest on the Loans
and the Notes and all other amounts payable hereunder or thereunder shall
thereupon and concurrently become due and payable without presentment, demand,
protest, notice of acceleration, notice of intent to accelerate or other notice
of any kind, all of which are hereby expressly waived, anything in this
Agreement or the Notes to the contrary notwithstanding and the Commitments of
the Lenders shall thereupon forthwith terminate.
8. THE AGENTS
SECTION 8.1. Administration by Agents.
The general administration of the Fundamental Documents and
any other documents contemplated by this Agreement shall be by the Agents or
their designees as provided for herein. Each of the Lenders hereby irrevocably
authorizes the Administrative Agent, at its discretion, to take or refrain from
taking such actions as agent on its behalf and to exercise or refrain from
exercising such powers under the Fundamental Documents, the Notes and any other
documents contemplated by this Agreement as are delegated by the terms hereof or
thereof, as appropriate, together with all powers reasonably incidental thereto.
Each of the Canadian Lenders hereby irrevocably authorizes the Canadian Agent,
at its discretion, to take or refrain from taking such actions as agent on its
behalf and to exercise or refrain from exercising such powers under the
Fundamental Documents, the Canadian Revolving Credit Notes and any other
documents contemplated by this Agreement as are delegated by the terms hereof or
thereof, as appropriates together with all powers reasonably incidental thereto.
The Agents shall have no duties or responsibilities except as set forth in the
Fundamental Documents. Any Lender which is a co-agent or lead manager (as
indicated on Schedule 1.1A hereto) for the credit facility hereunder shall not
have any duties or responsibilities except as a Lender hereunder.
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SECTION 8.2. Advances and Payments.
(a) On the date of each Loan, the Administrative Agent or the
Canadian Agent, as provided for herein, shall be authorized (but not obligated)
to advance, for the account of each of the applicable Lenders, the amount of the
Loan to be made by it in accordance with this Agreement. Each of the Lenders
(other than the Canadian Lenders) hereby authorizes and requests the
Administrative Agent and the Canadian Lenders hereby authorize and request the
Canadian Agent to advance for its account, pursuant to the terms hereof, the
amount of the Loan to be made by it, unless with respect to any Lender, such
Lender has theretofore specifically notified the Administrative Agent or the
Canadian Agent, as the case may be, that such Lender does not intend to fund
that particular Loan. Each of the Lenders agrees forthwith to reimburse the
Administrative Agent or the Canadian Agent, as the case may be, in immediately
available funds for the amount so advanced on its behalf by such Agent pursuant
to the immediately preceding sentence. If any such reimbursement is not made in
immediately available funds on the same day on which such Agent shall have made
any such amount available on behalf of any Lender in accordance with this
Section 8.2, such Lender shall pay interest to such Agent at a rate per annum
equal to such Agent's cost of obtaining overnight funds in the New York Federal
Funds Market in the case of US Loans, and the C$ Prime Rate in the case of
Canadian Loans. Notwithstanding the preceding sentence, if such reimbursement is
not made by the second Business Day following the day on which such Agent shall
have made any such amount available on behalf of any Lender or such Lender has
indicated that it does not intend to reimburse such Agent, the Borrower or the
Canadian Borrower, as the case may be, shall immediately pay such unreimbursed
advance amount (plus any accrued, but unpaid interest at the rate per annum
equal to such Agent's cost of obtaining overnight funds in the New York Federal
Funds Market in the case of US Loans and the C$ Prime Rate in the case of
Canadian Loans) to such Agent.
(b) Any amounts received by either of the Agents in connection
with this Agreement or the Notes the application of which is not otherwise
provided for shall be applied, in accordance with each of the Lenders' pro rata
interest therein, first, to pay accrued but unpaid Facility Fees, second, to pay
accrued but unpaid interest on the Notes, third, to pay the principal balance
outstanding on the Notes and fourth, to pay other amounts payable to the Agents
and/or the Lenders. All amounts to be paid to any of the Lenders by the
Administrative Agent or the Canadian Agent, as the case may be, shall be
credited to the applicable Lenders, after collection by such Agent, in
immediately available funds either by wire transfer or deposit in such Lender's
correspondent account with such Agent, or as such Lender and such Agent shall
from time to time agree.
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SECTION 8.3. Sharing of Setoffs and Cash Collateral.
Each of the Lenders agrees that if it shall, through the
operation of Section 2.19 or the exercise of a right of banker's lien, setoff or
counterclaim against the Borrower or the Canadian Borrower, including, but not
limited to, a secured claim under Section 506 of Title 11 of the United States
Code or other security or interest arising from, or in lieu of, such secured
claim and received by such Lender under any applicable bankruptcy, insolvency or
other similar law, or otherwise (other than pursuant to Section 2.15(f) or
2.24), obtain payment in respect of its Loans as a result of which the unpaid
portion of its Loans is proportionately less than the unpaid portion of any of
the other Lenders (a) it shall promptly purchase at par (and shall be deemed to
have thereupon purchased) from such other Lenders a participation in the Loans
of such other Lenders, so that the aggregate unpaid principal amount of each of
the Lenders' Loans and its participation in Loans of the other Lenders shall be
in the same proportion to the aggregate unpaid principal amount of all Loans
then outstanding as the principal amount of its Loans prior to the obtaining of
such payment was to the principal amount of all Loans outstanding prior to the
obtaining of such payment and (b) such other adjustments shall be made from time
to time as shall be equitable to ensure that the Lenders share such payment pro
rata.
SECTION 8.4. Notice to the Lenders.
Upon receipt by the Administrative Agent or the Canadian Agent
from the Borrower or the Canadian Borrower of any communication calling for an
action on the part of the Lenders, or upon notice to the Administrative Agent or
the Canadian Agent of any Event of Default, such Agent will in turn immediately
inform the other Lenders in writing (which shall include telegraphic
communications) of the nature of such communication or of the Event of Default,
as the case may be.
SECTION 8.5. Liability of Each Agent.
(a) Each of the Agents, when acting on behalf of the Lenders
may execute any of its duties under this Agreement by or through its officers,
agents, or employees and neither the Agents nor their respective directors,
officers, agents, or employees shall be liable to the Lenders or any of them for
any action taken or omitted to be taken in good faith, or be responsible to the
Lenders or to any of them for the consequences of any oversight or error of
judgment, or for any loss, unless the same shall happen through its gross
negligence or willful misconduct. Neither the Agents nor their respective
directors, officers, agents, and employees shall in any event be liable to the
Lenders or to any of them for any action taken or omitted to be taken by it
pursuant to instructions received by it from the Required Lenders or in reliance
upon the advice of counsel selected by it. Without limiting the foregoing,
neither the Agents nor any of their respective directors, officers, employees,
or agents shall be responsible to any of the Lenders for the due execution
(other than its own), validity, genuineness, effectiveness, sufficiency, or
enforceability of, or for any statement, warranty, or representation made by any
other Person in, or for the perfection of any security interest contemplated by,
this Agreement or any related agreement,
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document or order, or for the designation or failure to designate this
transaction as a "Highly Leveraged Transaction" for regulatory purposes, or
shall be required to ascertain or to make any inquiry concerning the performance
or observance by the Borrower or the Canadian Borrower, as the case may be, of
any of the terms, conditions, covenants, or agreements of this Agreement or any
related agreement or document.
(b) Neither the Agents nor any of their respective directors,
officers, employees, or agents shall have any responsibility to the Borrowers on
account of the failure or delay in performance or breach by any of the Lenders
or the Borrowers of any of their respective obligations under this Agreement or
the Notes or any related agreement or document or in connection herewith or
therewith.
(c) Each of the Agents in such capacities hereunder, shall be
entitled to rely on any communication, instrument, or document reasonably
believed by it to be genuine or correct and to have been signed or sent by a
Person or Persons believed by it to be the proper Person or Persons, and it
shall be entitled to rely on advice of legal counsel, independent public
accountants, and other professional advisers and experts selected by it.
SECTION 8.6. Reimbursement and Indemnification.
Each of the Lenders severally and not jointly agrees (i) to
reimburse the Agents and the Arranger, in the amount of its proportionate share,
for any reasonable expenses and fees incurred for the benefit of the Lenders
under the Fundamental Documents, including, without limitation, reasonable
counsel fees and compensation of agents and employees paid for services rendered
on behalf of the Lenders, and any other reasonable expense incurred in
connection with the administration or enforcement thereof not reimbursed by the
Borrowers or one of its Subsidiaries; and (ii) to indemnify and hold harmless
the Agents and the Arranger and any of their directors, officers, employees, or
agents, on demand, in the amount of its proportionate share, from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against it or any
of them in any way relating to or arising out of the Fundamental Documents or
any action taken or omitted by it or any of them under the Fundamental Documents
to the extent not reimbursed by the Borrowers or one of its Subsidiaries (except
such as shall result from the gross negligence or willful misconduct of the
Person seeking indemnification).
SECTION 8.7. Rights of Each Agent.
It is understood and agreed that Chase and Chase Canada shall
have the same rights and powers hereunder (including the right to give such
instructions) as the other Lenders and may exercise such rights and powers, as
well as its rights and powers under other agreements and instruments to which it
is or may be party, and engage in other transactions with the Borrowers as
though it were not an Agent on behalf of the Lenders under this Agreement.
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SECTION 8.8. Independent Investigation by Lenders.
Each of the Lenders acknowledges that it has decided to enter
into this Agreement and to make the Loans hereunder based on its own analysis of
the transactions contemplated hereby and of the creditworthiness of the
Borrowers and agrees that neither of the Agents shall bear responsibility
therefor.
SECTION 8.9. Notice of Transfer.
Each of the Agents may deem and treat any Lender which is a
party to this Agreement as the owners of such Lender's respective portions of
the Loans for all purposes, unless and until a written notice of the assignment
or transfer thereof executed by any such Lender shall have been received by the
Administrative Agent and become effective pursuant to Section 9.3.
SECTION 8.10. Successor Agents.
Each of the Agents may resign at any time by giving written
notice thereof to the Lenders and the Borrowers. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent from among
the Lenders, with the consent of the Borrower, which will not be unreasonably
withheld. If no successor Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment, within 30 days after the
retiring Agent's giving of notice of resignation, the retiring Agent may, on
behalf of the Lenders, appoint a successor Agent, which with the consent of the
Borrower, which will not be unreasonably withheld, shall be a commercial bank
organized or licensed under the laws of the United States or of any State
thereof and having a combined capital and surplus of at least $500,000,000 in
the case of the Administrative Agent and a commercial bank organized or licensed
under the laws of the Province of Ontario and having a combined capital and
surplus of at least C$100,000,000 in the case of the Canadian Agent. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Article 8 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement.
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9. MISCELLANEOUS
SECTION 9.1. Notices.
Notices and other communications provided for herein shall be
in writing and shall be delivered or mailed (or in the case of telegraphic
communication, if by telegram, delivered to the telegraph company and, if by
telex, telecopy, graphic scanning or other telegraphic communications equipment
of the sending party hereto, delivered by such equipment) addressed, if to the
Administrative Agent or Chase, to it at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, and with a copy
(in the case of all notices relating to Pounds Sterling Loans) to Chase
Manhattan Investment Bank Ltd., Trinity Tower, 9 ▇▇▇▇▇▇ ▇▇▇▇▇ Street, London,
England EY91T, Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, if to the Canadian Agent or Chase Canada,
to it at One First Canadian Place, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇
▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ MSX 1A4, Attn: ▇▇▇▇▇▇ Staff, if to the Borrower or
the Canadian Borrower, to it at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Assistant Treasurer, with a copy to the General Counsel,
or if to a Lender, to it at its address set forth on Schedule 1.1A (or in its
Assignment and Acceptance or other agreement pursuant to which it became a
Lender hereunder), or such other address as such party may from time to time
designate by giving written notice to the other parties hereunder. All notices
and other communications given to any party hereto in accordance with the
provisions of this Agreement shall be deemed to have been given on the fifth
Business Day after the date when sent by registered or certified mail, postage
prepaid, return receipt requested, if by mail, or when delivered to the
telegraph company, charges prepaid, if by telegram, or when receipt is
acknowledged, if by any telecopier or telegraphic communications equipment of
the sender, in each case addressed to such party as provided in this Section 9.1
or in accordance with the latest unrevoked written direction from such party.
SECTION 9.2. Survival of Agreement, Representations and
Warranties, etc.
All warranties, representations and covenants made by each of
the Borrowers herein or in any certificate or other instrument delivered by it
or on its behalf in connection with this Agreement shall be considered to have
been relied upon by the Agents and the Lenders and shall survive the making of
the Loans herein contemplated and the issuance and delivery to the Agents of the
Notes regardless of any investigation made by the Agents or the Lenders or on
their behalf and shall continue in full force and effect so long as any amount
due or to become due hereunder is outstanding and unpaid and so long as the
Commitments have not been terminated. All statements in any such certificate or
other instrument shall constitute representations and warranties by the
Borrowers hereunder.
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SECTION 9.3. Successors and Assigns; Syndications; Loan
Sales; Participations.
(a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the successors and
assigns of such party (provided that the Borrowers may not assign their
respective rights hereunder without the prior written consent of all the
Lenders), and all covenants, promises and agreements by, or on behalf of, the
Borrowers which are contained in this Agreement shall inure to the benefit of
the successors and assigns of the Lenders.
(b) Each of the Lenders may (but only with the prior written
consent of the Administrative Agent and the Borrower, which consents shall not
be unreasonably withheld or delayed) assign to one or more banks or other
financial institutions either (i) all or a portion of its interests, rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment and the same portion of the Loans at the time owing to
it and the Notes held by it) (a "Ratable Assignment") or (ii) all or a portion
of its rights and obligations under and in respect of (A) its Commitment under
this Agreement and the same portion of the Loans (other than Competitive Loans)
at the time owing to it or (B) the Competitive Loans at the time owing to it
(including, without limitation, in the case of any such type of Loan, the same
portion of the associated Note) (a "Non-Ratable Assignment"); provided that (1)
each Non-Ratable Assignment shall be of a constant, and not a varying,
percentage of all of the assigning Lender's rights and obligations in respect of
the Loans and the Commitment (if applicable) which are the subject of such
assignment, (2) each Ratable Assignment shall be of a constant, and not a
varying, percentage of the assigning Lender's rights and obligations under this
Agreement, (3) the amount of the Commitment or Competitive Loans, as the case
may be, of the assigning Lender subject to each such assignment (determined as
of the date the Assignment and Acceptance with respect to such assignment is
delivered to the Lender) shall be in a minimum Dollar Equivalent Amount of
$10,000,000 unless otherwise agreed by the Borrower and the Administrative Agent
and (4) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register (as
defined below), an Assignment and Acceptance, together with any Note or Notes
subject to such assignment (if required hereunder) and a processing and
recordation fee of $3,500. Upon such execution, delivery, acceptance and
recording, and from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be not earlier than five Business
Days after the date of acceptance and recording by the Administrative Agent, (x)
the assignee thereunder shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder and (y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of the assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto).
(c) [Intentionally Deleted].
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(d) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in, or in connection with, this Agreement and any other Fundamental
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Fundamental Documents or any other instrument or
document furnished pursuant hereto or thereto; (ii) such Lender assignor makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrowers or the performance or observance by the
Borrowers of any of their obligations under the Fundamental Documents; (iii)
such assignee confirms that it has received a copy of this Agreement, together
with copies of the most recent financial statements delivered pursuant to
Sections 5.1(a) and 5.1(b) (or if none of such financial statements shall have
then been delivered, then copies of the financial statements referred to in
Section 3.4) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the assigning Lender, the Administrative Agent, the Canadian
Agent, if the assignor is a Canadian Lender, or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee appoints and authorizes the Administrative
Agent and the Canadian Agent, if the assignor is a Canadian Lender, to take such
action as agent on its behalf and to exercise such powers under the Fundamental
Documents as are delegated to such Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; and (vi) such assignee agrees
that it will be bound by the provisions of this Agreement and will perform in
accordance with its terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Lender.
(e) The Administrative Agent, on behalf of the Borrowers,
shall maintain at its address at which notices are to be given to it pursuant to
Section 9.1, a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders and the
Commitment of, and principal amount of the Loans owing to, each Lender from time
to time (the "Register"). The entries in the Register shall be conclusive, in
the absence of manifest error, and the Borrower, the Administrative Agent and
the Lenders may (and, in the case of any Loan or other obligation hereunder not
evidenced by a Note, shall) treat each Person whose name is recorded in the
Register as the owner of a Loan or other obligation hereunder as the owner
thereof for all purposes of this Agreement and the other Fundamental Documents,
notwithstanding any notice to the contrary. Any assignment of any Loan or other
obligation hereunder not evidenced by a Note shall be effective only upon
appropriate entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
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(f) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee, any Notes subject to such assignment (if
required hereunder) and the processing and recordation fee, the Administrative
Agent (subject to the right, if any, of the Borrower to require its consent
thereto) shall, if such Assignment and Acceptance has been completed and is in
the form of Exhibit C hereto, (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and (iii) give prompt
written notice thereof to the Borrower. If a portion of its Commitment has been
assigned by an assigning Lender, then such Lender shall deliver its Note in
respect of such Commitment, if any, at the same time it delivers the applicable
Assignment and Acceptance to the Administrative Agent. If only Competitive Loans
have been assigned by the assigning Lender, such Lender shall not be required to
deliver its Competitive Note to the Administrative Agent, unless such Lender no
longer holds a Commitment under this Agreement, in which event such assigning
Lender shall deliver its Competitive Note, if any, at the same time it delivers
the applicable Assignment and Acceptance to the Administrative Agent. Within
five Business Days after receipt of the notice, the Borrower, at its own
expense, shall execute and deliver to the applicable Lenders at their request,
either (A) a new Note in respect of the assigned Commitment to the order of such
assignee in an amount equal to the Commitment assumed by it pursuant to such
Assignment and Acceptance and a Competitive Note to the order of such assignee
in an amount equal to the Total Commitment hereunder, and a new Note in respect
of the assigned Commitment to the order of the assigning Lender in an amount
equal to the Commitment retained by it hereunder, or (B) if Competitive Loans
only have been assigned and the assigning Lender holds a Commitment under this
Agreement, then a new Competitive Note to the order of the assignee Lender in an
amount equal to the outstanding principal amount of the Competitive Loan(s)
purchased by it pursuant to the Assignment and Acceptance, or (C) if Competitive
Loans only have been assigned and the assigning Lender does not hold a
Commitment under this Agreement, a new Competitive Note to the order of such
assignee in an amount equal to the outstanding principal amount of the
Competitive Loans(s) purchased by it pursuant to such Assignment and Acceptance
and, a new Competitive Note to the order of the assigning Lender in an amount
equal to the outstanding principal amount of the Competitive Loans retained by
it hereunder. Any new Notes shall be in an aggregate principal amount equal to
the aggregate principal amount of the Commitments of the respective Lenders. All
new Notes shall be dated the date hereof and shall otherwise be in substantially
the forms of Exhibits ▇-▇, ▇-▇, ▇-▇ and A-4 hereto, as the case may be.
(g) Each of the Lenders may without the consent of the
Borrowers or the Administrative Agent sell participations to one or more banks
or other financial institutions (a "Participant") in all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Commitment and the Loans owing to it and the Note or Notes
held by it); provided that (i) any such Lender's obligations under this
Agreement shall remain unchanged, (ii) such participant shall not be granted any
voting rights under this Agreement, except with respect to matters requiring the
consent of each of the Lenders hereunder, (iii) any such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iv) the participating banks or other entities shall be entitled to
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the cost protection provisions contained in Sections 2.14, 2.15 and 2.17 hereof
but a participant shall not be entitled to receive pursuant to such provisions
an amount larger than its share of the amount to which the Lender granting such
participation would have been entitled to receive, and (v) the Borrowers, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.
(h) The Lenders may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.3, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrowers furnished to the
Administrative Agent by or on behalf of the Borrowers.
(i) Each Lender hereby represents that it is a commercial
lender or financial institution which makes loans in the ordinary course of its
business and that it will make the Loans hereunder for its own account in the
ordinary course of such business; provided that, subject to preceding clauses
(a) through (h), the disposition of the Notes or other evidence of Indebtedness
held by that Lender shall at all times be within its exclusive control.
(j) Each of the Borrowers consents that any Lender may at any
time and from time to time pledge, or otherwise grant a security interest in,
any Loan or any Note evidencing such Loan (or any part thereof), including any
such pledge or grant to any Federal Reserve Bank, and this Section shall not
apply to any such pledge or grant; provided that no such pledge or grant shall
release a Lender from any of its obligations hereunder or substitute any such
assignee for such Lender as a party hereto.
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SECTION 9.4. Expenses; Documentary Taxes.
Whether or not the transactions hereby contemplated shall be
consummated, each of the Borrowers agrees to pay all reasonable out-of-pocket
expenses incurred by the Administrative Agent, the Canadian Agent and the
Arranger in connection with the syndication, preparation, execution, delivery
and administration of this Agreement, the Notes, and the making of the Loans
including but not limited to the reasonable fees and disbursements of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Administrative Agent, and Blake, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, counsel to the Canadian Agent, as well as all reasonable out-of-pocket
expenses incurred by the Lenders in connection with any restructuring or workout
of this Agreement, or the Notes or in connection with the enforcement or
protection of the rights of the Lenders in connection with this Agreement or the
Notes or any other Fundamental Document, and with respect to any action which
may be instituted by any Person against any Lender in respect of the foregoing,
or as a result of any transaction, action or nonaction arising from the
foregoing, including but not limited to the fees and disbursements of any
counsel for the Lenders. Such payments shall be made on the date of execution of
this Agreement and thereafter promptly on demand. Each of the Borrowers agrees
that it shall indemnify the Administrative Agent, the Canadian Agent and the
Lenders from, and hold them harmless against, any documentary taxes, assessments
or charges made by any Governmental Authority by reason of the execution and
delivery of this Agreement or the Notes or any other Fundamental Document. The
obligations of the Borrowers under this Section shall survive the termination of
this Agreement and/or the payment of the Loans for two years.
SECTION 9.5. Indemnity.
Further, by the execution hereof, each of the Borrowers agrees
to indemnify and hold harmless the Administrative Agent, the Canadian Agent, the
Arranger and the Lenders and their respective directors, officers, employees and
agents (each, an "Indemnified Party") from and against any and all expenses
(including reasonable fees and disbursements of counsel), losses, claims,
damages and liabilities arising out of any claim, litigation, investigation or
proceeding (regardless of whether any such Indemnified Party is a party thereto)
in any way relating to the transactions contemplated hereby, but excluding
therefrom all expenses, losses, claims, damages, and liabilities arising out of
or resulting from the gross negligence or willful misconduct of the Indemnified
Party seeking indemnification, provided that the Borrowers shall not be liable
for the fees and expenses of more than one separate firm for all such
Indemnified Parties in connection with any one such action or any separate but
substantially similar or related actions in the same jurisdiction, nor shall the
Borrowers be liable for any settlement of any proceeding effected without each
of the Borrowers' written consent, and provided, further, that this Section 9.5
shall not be construed to expand the scope of the reimbursement obligations
specified in Section 9.4. The obligations of each of the Borrowers under this
Section 9.5 shall survive the termination of this Agreement and/or payment of
the Loans.
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SECTION 9.6. CHOICE OF LAW.
THIS AGREEMENT AND THE NOTES HAVE BEEN EXECUTED AND DELIVERED
IN THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE
WITH, AND GOVERNED BY, THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS MADE AND
TO BE PERFORMED WHOLLY WITHIN SUCH STATE AND, IN THE CASE OF PROVISIONS RELATING
TO INTEREST RATES, ANY APPLICABLE LAWS OF THE UNITED STATES AND THE PROVINCE OF
ONTARIO.
SECTION 9.7. No Waiver.
No failure on the part of the Administrative Agent, the
Canadian Agent or any Lender to exercise, and no delay in exercising, any right,
power or remedy hereunder or under the Notes shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All remedies hereunder are cumulative and are not
exclusive of any other remedies provided by law.
SECTION 9.8. Extension of Maturity.
Except as otherwise specifically provided in Article 7, should
any payment of principal of or interest on the Notes or any other amount due
hereunder become due and payable on a day other than a Business Day, the
maturity thereof shall be extended to the next succeeding Business Day and, in
the case of principal, interest shall be payable thereon at the rate herein
specified during such extension.
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SECTION 9.9. Amendments, etc.
No modification, amendment or waiver of any provision of this
Agreement or any other Fundamental Document, and no consent to any departure by
either of the Borrowers herefrom or therefrom, shall in any event be effective
unless the same shall be in writing and signed or consented to in writing by the
Required Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given; provided that no such
modification or amendment shall without the written consent of each Lender
affected thereby (x) increase the Commitment of a Lender or postpone or waive
any scheduled reduction in the Commitments, (y) alter the stated maturity or
principal amount of any installment of any Loan, or decrease the rate of
interest payable thereon, or the rate at which the Facility Fees or (z) waive a
default under Section 7(b) with respect to a scheduled principal installment of
any Loan or scheduled payment of interest or fees; provided, further, that no
such modification or amendment shall without the written consent of all of the
Lenders (i) amend or modify any provision of this Agreement which provides for
the unanimous consent or approval of the Lenders or (ii) amend this Section 9.9
or the definition of Required Lenders or Supermajority Lenders or (iii) amend
Section 2.26; and provided, further, however, that no such modification or
amendment shall decrease the Commitment of any Lender without the written
consent of such Lender. No such amendment or modification may adversely affect
the rights and obligations of either of the Agents hereunder without its prior
written consent. No notice to or demand on the Borrowers shall entitle either
Borrower to any other or further notice or demand in the same, similar or other
circumstances. Each holder of a Note shall be bound by any amendment,
modification, waiver or consent authorized as provided herein, whether or not a
Note shall have been marked to indicate such amendment, modification, waiver or
consent and any consent by any holder of a Note shall bind any Person
subsequently acquiring a Note, whether or not a Note is so marked.
SECTION 9.10. Severability.
Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
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SECTION 9.11. SERVICE OF PROCESS; WAIVER OF JURY TRIAL.
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(a) EACH OF THE BORROWERS HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE STATE COURTS OF THE STATE OF NEW YORK LOCATED IN NEW YORK
COUNTY AND TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND THE COURTS OF THE PROVINCE OF ONTARIO FOR THE
PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON
THIS AGREEMENT OR THE SUBJECT MATTER HEREOF BROUGHT BY THE ADMINISTRATIVE AGENT,
THE CANADIAN AGENT OR A LENDER. EACH OF THE BORROWERS TO THE EXTENT PERMITTED BY
APPLICABLE LAW (A) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY OF MOTION, AS
A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH
COURTS, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF THE
ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT OR
EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT
FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER OR THAT THIS
AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE ENFORCED IN OR BY SUCH COURT,
AND (B) HEREBY WAIVES THE RIGHT TO ASSERT IN ANY SUCH ACTION, SUIT OR PROCEEDING
ANY OFFSETS OR COUNTERCLAIMS EXCEPT COUNTERCLAIMS THAT ARE COMPULSORY OR
OTHERWISE ARISE FROM THE SAME SUBJECT MATTER. EACH OF THE BORROWERS HEREBY
CONSENTS TO SERVICE OF PROCESS BY MAIL AT ITS ADDRESS TO WHICH NOTICES ARE TO BE
GIVEN PURSUANT TO SECTION 9.1. EACH OF THE BORROWERS AGREES THAT ITS SUBMISSION
TO JURISDICTION AND CONSENT TO SERVICE OF PROCESS BY MAIL IS MADE FOR THE
EXPRESS BENEFIT OF THE ADMINISTRATIVE AGENT, THE CANADIAN AGENT AND THE LENDERS.
THE CANADIAN BORROWER HEREBY IRREVOCABLY APPOINTS THE BORROWER AS ITS AGENT FOR
SERVICE OF PROCESS IN ANY PROCEEDING REFERRED TO IN THIS SECTION 9.11 AND AGREES
THAT SERVICE OF PROCESS IN ANY SUCH PROCEEDING MAY BE MADE BY MAILING OR
DELIVERING A COPY THEREOF TO IT CARE OF THE BORROWER AT ITS ADDRESS FOR NOTICES
SET FORTH IN SECTION 9.1. FINAL JUDGMENT AGAINST EITHER OF THE BORROWERS IN ANY
SUCH ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY
OTHER JURISDICTION (A) BY SUIT, ACTION OR PROCEEDING ON THE JUDGMENT, A
CERTIFIED OR TRUE COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE FACT AND THE
AMOUNT OF INDEBTEDNESS OR LIABILITY OF THE SUBMITTING PARTY THEREIN DESCRIBED OR
(B) IN ANY OTHER MANNER PROVIDED BY, OR PURSUANT TO, THE LAWS OF SUCH OTHER
JURISDICTION, PROVIDED THAT THE ADMINISTRATIVE AGENT, THE CANADIAN AGENT OR A
LENDER MAY AT ITS OPTION BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS
AGAINST EITHER OF THE BORROWERS OR ANY OF ITS ASSETS IN ANY ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ OR OF ANY COUNTRY OR PLACE WHERE EITHER OF THE
BORROWERS OR SUCH ASSETS MAY BE FOUND.
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(b) TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH
CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES, AND COVENANTS THAT IT WILL
NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY
JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF
ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF,
IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING OR WHETHER IN CONTRACT OR
TORT OR OTHERWISE. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED THAT
THE PROVISIONS OF THIS SECTION 9.11(b) CONSTITUTE A MATERIAL INDUCEMENT UPON
WHICH THE OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO
THIS AGREEMENT. THE PARTIES HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION 9.11(b) WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF SUCH
OTHER PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL BY JURY.
SECTION 9.12. Headings.
Section headings used herein are for convenience only and are
not to affect the construction of or be taken into consideration in interpreting
this Agreement.
SECTION 9.13. Execution in Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall constitute an original, but all of which taken together
shall constitute one and the same instrument.
SECTION 9.14. Entire Agreement.
This Agreement represents the entire agreement of the parties
with regard to the subject matter hereof and the terms of any letters and other
documentation entered into among the Borrower, the Administrative Agent or any
Lender (other than the provisions of the letter agreement dated February 4,
1997, among the Borrower, Chase and Chase Securities Inc., relating to fees and
expenses and syndication issues) prior to the execution of this Agreement which
relate to Loans to be made shall be replaced by the terms of this Agreement.
SECTION 9.15. Foreign Currency Judgments. (a) If, for the
purpose of obtaining judgment in any court, it is necessary to convert a sum
due hereunder in one currency into another currency, each of the Borrowers
agrees, to the fullest extent that it may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal banking
procedures in the relevant jurisdiction the relevant Lender (or agent acting on
its behalf) or the
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Administrative Agent could purchase the first currency with such other
currency for the first currency on the Business Day immediately preceding the
day on which final judgment is given.
(b) The obligations of either of the Borrowers in respect of
any sum due hereunder shall, notwithstanding any judgment in a currency (the
"Judgment Currency") other than that in which such sum is denominated in
accordance with this Agreement (the "Agreement Currency"), be discharged only to
the extent that, on the Business Day following receipt by any Lender (or agent
acting on its behalf) (the "Applicable Creditor") of any sum adjudged to be so
due in the Judgment Currency, the Applicable Creditor may in accordance with
normal banking procedures in the relevant jurisdiction purchase the Agreement
Currency with the Judgment Currency; if the amount of the Agreement Currency so
purchased is less than the sum originally due to the Applicable Creditor in the
Agreement Currency, each of the Borrowers agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Applicable Creditor against
such loss, provided, that if the amount of the Agreement Currency so purchased
exceeds the sum originally due to the Applicable Creditor, the Applicable
Creditor agrees to remit such excess to the Applicable Borrower. The obligations
of the Borrowers contained in this Section 9.15 shall survive the termination of
this Agreement and the payment of all amounts owing hereunder. Each Borrower
shall repay each Loan made to it, and interest thereon, in the Currency in which
such Loan is denominated.
SECTION 9.16. Risks of Superior Force. Each of the Borrowers
expressly assumes all risks of superior force, such that it shall be bound to
timely execute each and every of its obligations under this Agreement
notwithstanding the existence or occurrence of any event or circumstance
constituting a superior force within the meaning of Article 1693 of the Civil
Code of Quebec.
SECTION 9.17. Language. The parties hereto have agreed that
this Agreement as well as any document or instrument relating thereto be drawn
up in English only. Les parties aux presentes ont convenu que la presente
Convention ainsi que tous autres actes ou documents s'y rattachant soient
rediges en anglais seulement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and the year first above written.
PHH CORPORATION
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
_______________________
Title: Senior Vice President and Treasurer
PHH VEHICLE MANAGEMENT SERVICES INC.
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By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
_______________________
Title: Vice President and Treasurer
THE CHASE MANHATTAN BANK, individually
and as Administrative Agent
By: /s/ ▇▇▇▇ ▇▇▇▇▇
_______________________
Title: Vice President
THE CHASE MANHATTAN BANK OF
CANADA, as Canadian Agent
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
_______________________
Title: Vice President
BANK OF AMERICA ILLINOIS
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
_______________________
Title: Vice President
BANK OF MONTREAL
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_______________________
Title: Director
THE BANK OF NEW YORK
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_______________________
Title: Vice President
-▇▇-
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
By: /s/ J. ▇▇▇▇ ▇▇▇▇▇▇▇
_______________________
Title: Authorized Signatory
THE BANK OF TOKYO-MITSUBISHI,
LIMITED, NEW YORK BRANCH
By: /s/ J. ▇▇▇▇▇▇ ▇▇▇
_______________________
Title: Attorney-In-Fact
BANKERS TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
_______________________
Title: Vice President
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
______________________
Title: Director, CIBC Wood Gundy
Securities Corp., as Agent
COMERICA BANK
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________
Title: Account Officer
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COMMERZBANK AG (NEW YORK BRANCH)
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
_______________________
Title: Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_______________________
Title: Assistant Treasurer
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_______________________
Title: Vice President
DEUTSCHE BANK AG NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
_______________________
Title: Vice President
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
_______________________
Title: Associate
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
_______________________
Title: Vice President
THE FIRST NATIONAL BANK OF MARYLAND
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_______________________
Title: Vice President
-▇▇-
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________
Title: Vice President
THE FUJI BANK, LTD. NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
_______________________
Title: Vice Preisdent and Manager
MELLON BANK, N.A.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
_______________________
Title: Vice President
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
_______________________
Title: Vice President
NATIONSBANK, N.A.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
_______________________
Title: Vice President
-▇▇-
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_______________________
Title: Senior Manager
THE SUMITOMO BANK, LIMITED
NEW YORK BRANCH
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
_______________________
Title: Joint General Manager
▇▇▇▇▇ FARGO BANK, N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________
Title: Senior Vice President
Schedule 1.1A
Commitments
Lender Commitment
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================================================================================
TOTAL $1,250,000,000.00
Schedule 1.1B
Available Foreign Currencies
For purposes of Competitive Loans, Available Foreign Currencies are the
following:
Canadian Dollars
the lawful currency of France
the lawful currency of Germany
Japanese Yen
the lawful currency of England
Swiss Francs
the lawful currency of Italy
Schedule 2.14
Calculation of Additional Interest for Pounds Sterling Loans
1. The additional interest for any period shall (subject to paragraph 5
below) be calculated in accordance with the following formula:
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BY + L(Y-X) + S(Y-Z) per cent, per annum
____________________
100 - (B+S)
where on the day of application of the formula:
B is the percentage of the Administrative Agent's eligible
liabilities which the Bank of England then requires the
Administrative Agent to hold on a non-interest-bearing deposit
account in accordance with its cash ratio requirements;
Y is the rate at which Pounds Sterling deposits are offered by
the Administrative Agent to leading banks in the London
Interbank Market at or about 11 a.m. on that day for the
relevant period;
L is the percentage of eligible liabilities which (as a result
of the requirements of the Bank of England) the Administrative
Agent maintains as secured money with members of the London
Discount Market Association or in certain marketable or
callable securities approved by the Bank of England, which
percentage shall (in the absence of evidence that any other
figure is appropriate) be conclusively presumed to be 5%;
X is the rate at which secured Pounds Sterling investments may
be placed by the Administrative Agent with members of the
London Discount Market Association at or about 11 a.m. on that
day for the relevant period or, if greater, the rate at which
Pounds Sterling bills of exchange (of a tenor equal to the
duration of the relevant period) eligible for rediscounting at
the Bank of England can be discounted in the London Discount
Market at or about 11 a.m. on that day;
S is the percentage of the Administrative Agent's eligible
liabilities which the Bank of England requires the
Administrative Agent to place as a special deposit; and
Z is the interest rate per annum allowed by the Bank of England
on special deposits.
2. For the purposes of this schedule 2.14:
(a) "eligible liabilities" and "special deposits" have the
meanings given to them at the time of application of the
formula by the Bank of England; and
(b) "relevant period" in relation to each period for which
additional interest is to be calculated means:
(i) if it is 3 months or less, that period; or
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(ii) if it more than 3 months, 3 months.
3. In the application of the formula, B, Y, L, X, S and Z are included in
the formula as figures and not as percentages, e.g. if B = 0.5% and Y =
15% BY is calculated as 0.5 X 15.
4. The formula shall be applied on the first day of each relevant period.
Each amount shall be rounded up to the nearest four decimal places.
5. If the Administrative Agent determines that a change in circumstances
has rendered, or will render, the formula inappropriate, the
Administrative Agent (after consultation with the Lenders) shall notify
the Borrower of the manner in which the additional interest will
subsequently be calculated provided that no amendment to the manner of
such calculation may be made other than to restore the position in
terms of overall return to that which prevailed before such change
occurred. The manner of calculation so notified by the Administrative
Agent shall, in the absence of manifest error be binding on all the
parties.
Schedule 3.6
Material Subsidiaries
----------------------------------------------------------------------------------------------------------------------
Subsidiary Name Jurisdiction of Authorized Shares Issued Ownership of Capital
Incorporation Capitalization Stock*
----------------------------------------------------------------------------------------------------------------------
PHH Vehicle Management Maryland 100,000(C) 404(C) PHH Holdings
Services Corporation Corporation
PHH Real Estate Delaware 1,000(C) 860(C) PHH Holdings
Services Corporation Corporation
PHH Mortgage Services New Jersey 5,000(C) 1,000(C) PHH Holdings
Corporation 20,000(P) 0(P) Corporation
PHH Holdings Maryland 5,000 100 PHH Corporation
Corporation
PHH Investments I Delaware 5,000 1,000 PHH Corporation
Corporation
-▇▇-
▇▇▇ ▇▇▇▇▇▇ ▇▇▇** ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 25,000,000 18,251,110 PHH Holdings
Corporation
PHH Vehicle Management United Kingdom 2,000,000 1,147,500 PHH Europe PLC
Services PLC**
PHH Financial Services United Kingdom 10,000,000 10,000,000 PHH Investment
Ltd.** Services Ltd.***
* Ownership is 100% unless otherwise indicated.
** These Material Subsidiaries Do Not principally transact business in the
United States.
*** Does not meet the Material Subsidiary test.
(C)=Common stock
(P)=Preferred stock
Schedule 3.9
Litigation
None.
Schedule 6.1
Existing Indebtedness and Guaranties
None.
Schedule 6.5
Existing Liens
None.
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EXECUTION COPY
================================================================================
$1,250,000,000
364-DAY COMPETITIVE ADVANCE AND
REVOLVING CREDIT AGREEMENT
Dated as of March 4, 1997
among
PHH CORPORATION
and
PHH VEHICLE MANAGEMENT SERVICES INC.
as Borrowers
and
THE LENDERS REFERRED TO HEREIN
and
THE CHASE MANHATTAN BANK, as Administrative Agent
and
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇, as Canadian Agent
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CHASE SECURITIES INC., Arranger
TABLE OF CONTENTS
Page
----
1. DEFINITIONS................................................................................................. 1
2. THE LOANS................................................................................................... 22
SECTION 2.1. Commitments.............................................................................. 22
SECTION 2.2. Loans.................................................................................... 24
SECTION 2.3. Use of Proceeds.......................................................................... 26
SECTION 2.4. Competitive Bid Procedure................................................................ 26
SECTION 2.5. Revolving Credit Borrowing Procedure..................................................... 29
SECTION 2.6. Refinancings............................................................................. 30
SECTION 2.7. Fees..................................................................................... 31
SECTION 2.8. Repayment of Loans; Evidence of Debt..................................................... 31
SECTION 2.9. Interest on Loans........................................................................ 33
SECTION 2.10. Interest on Overdue Amounts.............................................................. 35
SECTION 2.11. Alternate Rate of Interest............................................................... 35
SECTION 2.12. Termination and Reduction of Commitments................................................. 36
SECTION 2.13. Prepayment of Loans...................................................................... 36
SECTION 2.14. Eurocurrency Reserve Costs............................................................... 38
SECTION 2.15. Reserve Requirements; Change in Circumstances............................................ 38
SECTION 2.16. Change in Legality....................................................................... 41
SECTION 2.17. Reimbursement of Lenders................................................................. 42
SECTION 2.18. Pro Rata Treatment....................................................................... 43
SECTION 2.19. Right of Setoff.......................................................................... 44
SECTION 2.20. Manner of Payments....................................................................... 45
SECTION 2.21. Withholding Taxes........................................................................ 45
SECTION 2.22. Certain Pricing Adjustments.............................................................. 47
SECTION 2.23. [Intentionally Deleted.]................................................................. 48
SECTION 2.24. Extension of Maturity Date............................................................... 48
SECTION 2.25. Bankers' Acceptances..................................................................... 50
SECTION 2.26. Guarantee................................................................................ 52
3. REPRESENTATIONS AND WARRANTIES OF BORROWER.................................................................. 55
SECTION 3.1. Corporate Existence and Power............................................................ 55
SECTION 3.2. Corporate Authority and No Violation..................................................... 55
SECTION 3.3. Governmental and Other Approval and Consents............................................. 56
SECTION 3.4. Financial Statements of Borrower......................................................... 56
SECTION 3.5. No Material Adverse Change............................................................... 56
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SECTION 3.6. Material Subsidiaries.................................................................... 56
SECTION 3.7. Copyrights, Patents and Other Rights..................................................... 57
SECTION 3.8. Title to Properties...................................................................... 57
SECTION 3.9. Litigation............................................................................... 57
SECTION 3.10. Federal Reserve Regulations.............................................................. 57
SECTION 3.11. Investment Company Act................................................................... 57
SECTION 3.12. Enforceability........................................................................... 58
SECTION 3.13. Taxes.................................................................................... 58
SECTION 3.14. Compliance with ERISA.................................................................... 58
SECTION 3.15. Disclosure............................................................................... 59
SECTION 3.16. Environmental Liabilities................................................................ 59
4. CONDITIONS OF LENDING....................................................................................... 59
SECTION 4.1. Conditions Precedent to Effectiveness.................................................... 59
(a) Loan Documents........................................................................... 59
(b) Corporate Documents for the Borrower..................................................... 59
(c) Financial Statements..................................................................... 60
(d) Opinions of Counsel...................................................................... 60
(e) No Material Adverse Change............................................................... 60
(f) Payment of Fees.......................................................................... 60
(g) Litigation............................................................................... 60
(h) Existing Credit Agreements............................................................... 60
(i) Officer's Certificate.................................................................... 60
SECTION 4.2. Conditions Precedent to Each Loan........................................................ 61
(a) Notice................................................................................... 61
(b) Representations and Warranties........................................................... 61
(c) No Event of Default...................................................................... 61
5. AFFIRMATIVE COVENANTS....................................................................................... 61
SECTION 5.1. Financial Statements, Reports, etc. ..................................................... 62
SECTION 5.2. Corporate Existence; Compliance with Statutes............................................ 63
SECTION 5.3. Insurance................................................................................ 64
SECTION 5.4. Taxes and Charges........................................................................ 64
SECTION 5.5. ERISA Compliance and Reports............................................................. 64
SECTION 5.6. Maintenance of and Access to Books and Records; Examinations............................. 65
SECTION 5.7. Maintenance of Properties................................................................ 65
6. NEGATIVE COVENANTS.......................................................................................... 66
SECTION 6.1. Limitation on Material Subsidiary Indebtedness........................................... 66
SECTION 6.2. [Intentionally deleted].................................................................. 67
SECTION 6.3. Limitation on Transactions with Affiliates............................................... 67
SECTION 6.4. Consolidation, Merger, Sale of Assets.................................................... 67
SECTION 6.5. Limitations on Liens..................................................................... 68
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SECTION 6.6. Sale and Leaseback....................................................................... 69
SECTION 6.7. Consolidated Net Worth................................................................... 69
SECTION 6.8. Ratio of Indebtedness To Consolidated Net Worth.......................................... 70
SECTION 6.9. Accounting Practices..................................................................... 70
SECTION 6.10. Restrictions Affecting Subsidiaries...................................................... 70
7. EVENTS OF DEFAULT........................................................................................... 70
8. THE AGENTS.................................................................................................. 73
SECTION 8.1. Administration by Agents................................................................. 73
SECTION 8.2. Advances and Payments.................................................................... 74
SECTION 8.3. Sharing of Setoffs and Cash Collateral................................................... 75
SECTION 8.4. Notice to the Lenders.................................................................... 75
SECTION 8.5. Liability of Each Agent.................................................................. 75
SECTION 8.6. Reimbursement and Indemnification........................................................ 76
SECTION 8.7. Rights of Each Agent..................................................................... 77
SECTION 8.8. Independent Investigation by Lenders..................................................... 77
SECTION 8.9. Notice of Transfer....................................................................... 77
SECTION 8.10. Successor Agents......................................................................... 77
9. MISCELLANEOUS............................................................................................... 78
SECTION 9.1. Notices.................................................................................. 78
SECTION 9.2. Survival of Agreement, Representations and Warranties, etc. ............................. 79
SECTION 9.3. Successors and Assigns; Syndications; Loan Sales; Participations......................... 79
SECTION 9.4. Expenses; Documentary Taxes.............................................................. 83
SECTION 9.5. Indemnity................................................................................ 84
SECTION 9.6. CHOICE OF LAW............................................................................ 84
SECTION 9.7. No Waiver................................................................................ 84
SECTION 9.8. Extension of Maturity.................................................................... 85
SECTION 9.9. Amendments, etc. ........................................................................ 85
SECTION 9.10. Severability............................................................................. 85
SECTION 9.11. SERVICE OF PROCESS; WAIVER OF JURY TRIAL................................................. 86
SECTION 9.12. Headings................................................................................. 87
SECTION 9.13. Execution in Counterparts................................................................ 87
SECTION 9.14. Entire Agreement......................................................................... 87
SECTION 9.15. Foreign Currency Judgments............................................................... 87
SECTION 9.16. Risks of Superior Force.................................................................. 88
SECTION 9.17. Language................................................................................. 88
SCHEDULES
1.1A Lenders, Addresses and Commitments
1.1B Available Foreign Currencies
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2.14 Eurocurrency Reserve Costs For Pounds Sterling Loans
3.6 Material Subsidiaries
3.9 Litigation
6.1 Existing Material Subsidiary Indebtedness
6.5 Existing Liens
EXHIBITS
A-1 Form of Revolving Credit Note
A-2 Form of Competitive Note
A-3 Form of Canadian Revolving Credit Note
A-4 Form of Pounds Sterling Note
B-1 Opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
B-2 Opinion of Piper & Marbury
B-3 Opinion of Blake, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
C Form of Assignment and Acceptance
D Form of Compliance Certificate
E-1 Form of Competitive Bid Request
E-2 Form of Competitive Bid Invitation
E-3 Form of Competitive Bid
E-4 Form of Competitive Bid Accept/Reject Letter
F Form of Revolving Credit Borrowing Request
G Form of Extension Request
H Form of Replacement Bank Agreement
I Form of Bankers' Acceptance
J Form of Notice of Rollover
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