CREDIT AGREEMENT, dated as of July 1, 1997 (this "Agreement"),
among The Gap, Inc., a Delaware corporation (the "Borrower"), the
LC Subsidiaries (as hereinafter defined), the banks and financial institutions
(the "Banks") listed on the signature pages hereof, Citibank, N.A.
("Citibank"), as issuing bank (the "Issuing Bank") and Citicorp USA Inc.
("CUSA"), as agent (the "Agent") for the Lenders and Issuing Bank hereunder:
PRELIMINARY STATEMENT: The Borrower has requested the Banks to
make available to it up to $350,000,000 in revolving credit loans to be used
for general corporate purposes. The Borrower has requested the Issuing Bank
to issue from time to time documentary letters of credit for its account and
for the account of the LC Subsidiaries (as hereinafter defined) in an
aggregate face amount at any time outstanding not to exceed $450,000,000.
Subject to the terms and conditions of this Agreement, the Banks agree to make
such revolving credit and term loans, and the Issuing Bank agrees to issue
such documentary letters of credit.
NOW THEREFORE, the Borrower, the LC Subsidiaries (as hereinafter
defined), the Banks, the Lenders from time to time party hereto, the Issuing
Bank and the Agent agree as follows:
ARTICLE IDEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"A Advance" means an advance by an A Lender to the Borrower as
part of an A Borrowing and refers to a Base Rate Advance or a Eurodollar
Rate Advance, each of which shall be a "Type" of A Advance.
"A Borrowing" means a borrowing consisting of simultaneous
A Advances of the same Type made by each of the A Lenders pursuant to
Section 2.01.
"A Commitment" means, as to each A Lender, the amount set forth
opposite such A Lender's name on the signature pages hereof under the
caption 'A Commitment' or, if such A Lender has entered into one or more
Assignment and Acceptances, the amount set forth for such A Lender with
respect thereto in the Register maintained by the Agent pursuant to
Section 10.07 hereof, in each case as such amount may be reduced or
increased pursuant to Section 2.05.
"A Commitment Increase" has the meaning specified in Section
2.05(b).
"A Lender" means any Lender having an A Commitment or to which
A Advances are owed.
"Advance" means an A Advance or a B Advance, and "Advances" means
the A Advances and the B Advances.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by, or is under common
control with, such Person.
"Alternative Currency" means any lawful currency other than
Dollars which is freely transferable and convertible into Dollars and
which the Issuing Bank can obtain in the ordinary course of its
business.
"Applicable Lending Office" means, with respect to each Lender,
such Lender's Domestic Lending Office in the case of a Base Rate
Advance, and such Lender's Eurodollar Lending Office in the case of a
Eurodollar Rate Advance and, in the case of a B Advance, the office of
such Lender notified by such Lender to the Agent as its Applicable
Lending Office with respect to such B Advance.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Agent, in substantially the form of Exhibit B hereto.
"B Advance" means an advance by an A Lender to the Borrower as
part of a B Borrowing resulting from the auction bidding procedure
described in Section 2.03.
"B Borrowing" means a borrowing consisting of simultaneous
B Advances from each of the A Lenders whose offer to make one or more
B Advances as part of such borrowing has been accepted by the Borrower
under the auction bidding procedure described in Section 2.03.
"B Reduction" has the meaning specified in Section 2.01.
"Base Rate" means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time which rate per annum shall
at all times be equal to the highest of:
(a) the rate of interest announced publicly by Citibank in
New York, New York, from time to time, as Citibank's base rate;
(b) 1/2% per annum above the latest three-week moving
average of secondary market morning offering rates in the United
States for three-month certificates of deposit of major United
States money market banks, such three-week moving average being
determined weekly on each Monday (or, if any such date is not a
Business Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday by the Agent on
the basis of such rates reported by certificate of deposit dealers
to and published by the Federal Reserve Bank of New York or, if
such publication shall be suspended or terminated, on the basis of
quotations for such rates received by the Agent from three New
York certificate of deposit dealers of recognized standing
selected by the Agent, in either case adjusted to the nearest 1/4
of one percent or, if there is no nearest 1/4 of one percent, to
the next higher 1/4 of one percent; and
(c) 1/2% per annum above the Federal Funds Rate.
"Base Rate Advance" means an A Advance which bears interest as
provided in Section 2.07(a).
"Borrowing" means an A Borrowing or a B Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized to close in New York City or San Francisco,
California and a day on which wire transfers may be effectuated among
member banks of the Federal Reserve System through use of the fedwire
funds transfer system and (i) if the applicable Business Day relates to
any Eurodollar Rate Advances, a day on which dealings are carried on in
the London interbank market and (ii) if the applicable Business Day
relates to any Letter of Credit denominated in an Alternative Currency,
a day on which commercial banks are open for business in the country of
issue of such Alternative Currency and on which dealings in such
Alternative Currency are carried on by such commercial banks in such
country of issue.
"Capital Lease" of any Person means any lease of any property
(whether real, personal or mixed) by such Person as lessee, which lease
should, in accordance with generally accepted accounting principles, be
required to be accounted for as a capital lease on the balance sheet of
such Person.
"Cash Equivalent" means (i) direct obligations issued by or
unconditionally guaranteed by the United States government or issued by
any agency thereof and supported by the full faith and credit of the
United States government, in each case maturing within twelve months
from the date of acquisition thereof, (ii) commercial paper maturing not
more than 270 days from the date of acquisition thereof issued by a
United States corporation and, at the time of acquisition, having the
highest ratings obtainable from both Standard & Poor's Corporation and
Moody's Investors Service, Inc., (iii) Dollar denominated investments in
money market funds and (iv) certificates of deposit, banker's
acceptances, and secured repurchase agreements, in each case maturing
within one year from the date of acquisition, and issued by or entered
into with any banking institution having a combined capital and surplus
of not less than $500,000,000.
"CERCLA" means the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended (42 U.S.C. Sec. 9601 et
seq.), and any regulations promulgated thereunder.
"Change of Control" means the occurrence, after the date of this
Agreement, of (i) any Person or two or more Persons acting in concert
acquiring beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of
1934), directly or indirectly, of securities of the Borrower (or other
securities convertible into such securities) representing 50% or more of
the combined voting power of all securities of the Borrower entitled to
vote in the election of directors; or (ii) during any period of up to 24
consecutive months, commencing before or after the date of this
Agreement, individuals who at the beginning of such 24-month period were
directors of the Borrower ceasing for any reason to constitute a
majority of the Board of Directors of the Borrower unless the Persons
replacing such individuals were nominated by the Board of Directors of
the Borrower; or (iii) any Person or two or more Persons acting in
concert acquiring by contract or otherwise, or entering into a contract
or arrangement which upon consummation will result in its or their
acquisition of, control over securities of the Borrower (or other
securities convertible into such securities) representing 50% or more of
the combined voting power of all securities of the Borrower entitled to
vote in the election of directors; provided, that, the Person or group
of Persons referred to in clauses (i) and (iii) of this definition of
Change of Control shall not include any Person listed on Schedule III
hereto or any group of Persons in which one or more of the Persons
listed on Schedule III are members.
"Consolidated" and any derivative thereof each means, with
reference to the accounts or financial reports of any Person, the
consolidated accounts or financial reports of such Person and each
Subsidiary of such Person determined in accordance with generally
accepted accounting principles, including principles of consolidation,
consistent with those applied in the preparation of the Consolidated
financial statements of the Borrower referred to in Section 6.01(e).
"Convert", "Conversion" and "Converted" each refers to a
conversion of A Advances of one Type into A Advances of another Type
pursuant to Section 2.09 or 2.10.
"Debt" of any Person means, without duplication, (i) all
indebtedness of such Person for borrowed money or for the deferred
purchase price (excluding any deferred purchase price that constitutes
an account payable incurred in the ordinary course of business) of
property or services, (ii) all obligations of such Person in connection
with any agreement to purchase, redeem, exchange, convert or otherwise
acquire for value any capital stock of such Person or to purchase,
redeem or acquire for value any warrants, rights or options to acquire
such capital stock, now or hereafter outstanding, (iii) all obligations
of such Person evidenced by bonds, notes, debentures, convertible
debentures or other similar instruments, (iv) all indebtedness created
or arising under any conditional sale or other title retention agreement
(other than under any such agreement which constitutes or creates an
account payable incurred in the ordinary course of business) with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of
default, acceleration, or termination are limited to repossession or
sale of such property), (v) all Capital Lease obligations of such
Person, (vi) obligations under direct or indirect guaranties in respect
of, and obligations (contingent or otherwise) to purchase or acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness
or obligations of others of the kinds referred to in clauses (i) through
(v) above, (vii) all Debt referred to in clause (i), (ii), (iii), (iv),
(v) or (vi) above secured by (or for which the holder of such Debt has
an existing right, contingent or otherwise, to be secured by) any lien,
security interest or other charge or encumbrance upon or in property
(including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable
for the payment of such Debt and (viii) all mandatorily redeemable
preferred stock of such Person, valued at the applicable redemption
price, plus accrued and unpaid dividends payable in respect of such
redeemable preferred stock.
"Default" means an event which would constitute an Event of
Default but for the requirement that notice be given or time elapse, or
both.
"Dollars", "dollars" and the sign "$" each means lawful money of
the United States.
"Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender, or such other office of
such Lender as such Lender may from time to time specify to the Borrower
and the Agent.
"EBITDA" means, for any period, Net Income plus, to the extent
deducted in determining such Net Income, the sum of (a) Interest
Expense, (b) income tax expense, (c) depreciation expense and (d)
amortization expense, all determined on a Consolidated basis for the
Borrower and its Subsidiaries in accordance with generally accepted
accounting principles.
"Eligible Assignee" means (i) a commercial bank organized under
the laws of the United States, or any State thereof, and having Total
Assets in excess of $10,000,000,000; (ii) a commercial bank organized
under the laws of any other country which is a member of the OECD or has
concluded special lending arrangements with the International Monetary
Fund associated with its General Arrangements to Borrow, or a political
subdivision of any such country, and having Total Assets in excess of
$10,000,000,000; provided, that, such bank is acting through a branch or
agency located in the United States; (iii) the central bank of any
country which is a member of the OECD; (iv) any Bank or Lender or
Affiliate of a Bank or Lender; (v) a finance company, insurance company
or other financial institution or fund (whether a corporation,
partnership or other entity) which is engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its
business, and having Total Assets in excess of $10,000,000,000; and (vi)
any other Person mutually acceptable to the Borrower and the Agent.
"Environmental Laws" means any and all laws, statutes, ordinances,
rules, regulations, judgments, orders, decrees, permits, licenses, or
other governmental restrictions or requirements relating to the
environment or any Hazardous Substance.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) which is a member of a controlled group of which the
Borrower or any Subsidiary of the Borrower is a member or which is under
common control with the Borrower or any Subsidiary of the Borrower
within the meaning of Section 414 of the Internal Revenue Code of 1986,
as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Eurocurrency Liabilities" has the meaning assigned to that term
in Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender (or, if no such office
is specified, its Domestic Lending Office), or such other office of such
Lender as such Lender may from time to time specify to the Borrower and
the Agent.
"Eurodollar Rate" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same A Borrowing, an
interest rate per annum equal to the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum) of the rates per annum
at which deposits in Dollars are offered by the principal office of each
of the Reference Banks in London, England, to prime banks in the London
interbank market at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period in an amount substantially equal
to such Reference Bank's Eurodollar Rate Advance comprising part of such
A Borrowing and for a period equal to such Interest Period. The
Eurodollar Rate for the Interest Period for each Eurodollar Rate Advance
comprising part of the same A Borrowing shall be determined by the Agent
on the basis of the applicable rates given to and received by the Agent
from the Reference Banks two Business Days prior to the first day of
such Interest Period, subject, however, to the provisions of Section
2.09.
"Eurodollar Rate Advance" means an A Advance which bears interest
as provided in Section 2.07(b).
"Eurodollar Rate Margin" means at any date of determination 0.165%
per annum at all times from and after the date hereof.
"Eurodollar Rate Reserve Percentage" of any Lender for any
Interest Period for any Eurodollar Rate Advance means the reserve
percentage applicable during such Interest Period (or if more than one
such percentage shall be so applicable, the daily average of such
percentages for those days in such Interest Period during which any such
percentage shall be so applicable) under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal
reserve requirement) for such Lender with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term
equal to such Interest Period.
"Events of Default" has the meaning specified in Section 8.01.
"Federal Funds Rate" means, 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 for such day (or, if such day is not a Business Day, for
the next preceding Business Day) by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.
"Fiscal Quarter" means any quarter in any Fiscal Year, the
duration of such quarter being defined in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the Borrower's financial statements referred to in
Section 6.01(e).
"Fiscal Year" means a fiscal year of the Borrower and its
Subsidiaries.
"Five-Year Credit Agreement" means the Credit Agreement dated as
of July 1, 1997 among the Borrower, the financial institutions party
thereto as lenders, and CUSA, as agent for such lenders, as the same may
be amended, supplemented or otherwise modified from time to time.
"Hazardous Substance" means (i) any hazardous substance or toxic
substance as such terms are presently defined or used in Sec. 101(14) of
CERCLA (42 U.S.C. Sec. 9601(14)), in 33 U.S.C. Sec. 1251 et.seq. (Clean Water
Act), or 15 U.S.C. Sec. 2601 et.seq. (Toxic Substances Control Act) and
(ii) as of any date of determination, any additional substances or
materials which are hereafter incorporated in or added to the definition
of "hazardous substance" or "toxic substance" for purposes of CERCLA or
any other applicable law.
"Interest Expense" of any Person for any period means the
aggregate amount of interest or fees (other than agency fees payable to
the Agent, as such) paid, accrued or scheduled to be paid or accrued in
respect of any Debt (including the interest portion of rentals under
Capital Leases) and all but the principal component of payments in
respect of conditional sales, equipment trust or other title retention
agreements paid, accrued or scheduled to be paid or accrued by such
Person during such period, determined in accordance with generally
accepted accounting principles.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same A Borrowing, the period commencing on the
date of such Type of A Advance or the date of the Conversion of any
A Advance into such Type of an A Advance and ending on the last day of
the period selected by the Borrower pursuant to the provisions below
and, thereafter, each subsequent period commencing on the last day of
the immediately preceding Interest Period and ending on the last day of
the period selected by the Borrower pursuant to the provisions below.
The duration of each such Interest Period shall be 1, 2, 3 or 6 months
in the case of a Eurodollar Rate Advance, in each case as the Borrower
may, upon notice received by the Agent not later than 12:00 noon (New
York City time) on the third Business Day prior to the first day of such
Interest Period, select; provided, however, that:
(i) the Borrower may not select any Interest Period which
ends after the Revolver Termination Date;
(ii) Interest Periods commencing on the same date for
A Advances comprising part of the same A Borrowing shall be of the
same duration;
(iii) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day
of such Interest Period shall be extended to occur on the next
succeeding Business Day, provided, in the case of any Interest
Period for a Eurodollar Rate Advance, that if such extension would
cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period
shall occur on the next preceding Business Day; and
(iv) the Borrower may request in a Notice of A Borrowing an
Interest Period of 9 or 12 months for a Eurodollar Rate Advance
and the Interest Period for such Eurodollar Rate Advance shall be
9 or 12 months, as requested by the Borrower, if, and only if, the
Agent determines a Eurodollar Rate for the tenor of such Interest
Period and the Majority A Lenders do not notify the Agent pursuant
to Section 2.09(b) that the Eurodollar Rate for such Interest
Period will not adequately reflect the cost to such Majority A
Lenders of making, funding or maintaining their respective
Eurodollar Rate Advances for such Interest Period; if both of the
preceding conditions are not satisfied with respect to such
requested 9 or 12 month Interest Period, the duration of the
requested Interest Period shall be the alternative specified in
the Notice of A Borrowing, or, if no alternative Interest Period
is selected, 6 months.
"Issue" means, with respect to any Letter of Credit, either to
issue, or to extend the expiry of, or to renew, or to increase the
amount of, such Letter of Credit, and the term "Issued" or "Issuance"
shall have corresponding meanings.
"Issuing Bank" means Citibank or any Affiliate of Citibank that
may from time to time Issue Letters of Credit for the account of the
Borrower or for the account of any LC Subsidiary.
"LC Commitment" means, as to any LC Lender, the amount set forth
opposite such LC Lender's name on the signature pages hereof under the
caption 'LC Commitment', or, if such LC Lender has entered into one or
more Assignment and Acceptances, the amount set forth for such LC Lender
with respect thereto in the Register maintained by the Agent pursuant to
Section 10.07 hereof, in each case as such amount may be reduced or
increased from time to time pursuant to Section 3.09."
"LC Commitment Increase" has the meaning specified in Section
3.09(b).
"LC Commitment Percentage" means, with respect to each LC Lender,
the percentage of which the then existing LC Commitment of such
LC Lender is of the LC Commitments of all LC Lenders; provided, however,
that with respect to Letters of Credit which expire after the LC
Termination Date has occurred, the LC Commitment Percentage of each LC
Lender shall be the percentage of which such LC Lender's LC Commitment
immediately prior to the LC Termination Date is of the LC Commitment of
all LC Lenders immediately prior to the LC Termination Date.
"LC Lender" means any Lender that has a LC Commitment or which, at
the date of determination, has purchased (pursuant to Section 3.04) a
participation in a Letter of Credit.
"LC Subsidiary" means, as of the date hereof, the Subsidiaries of
the Borrower listed on Schedule V hereto and, after the date hereof, any
other Subsidiary of the Borrower that may from time to time become a
party hereto (with respect to Letters of Credit only) and for whose
account the Issuing Bank may from time to time Issue Letters of Credit.
"LC Termination Date" means, subject to Section 3.11 hereof, June
30, 1998, or the earlier date of termination in whole of the
LC Commitments pursuant to Section 3.09 or Section 8.01.
"Lenders" means the Banks listed on the signature pages hereof and
each Eligible Assignee that shall become a party hereto pursuant to
Section 10.07.
"Letter of Credit" means a documentary letter of credit in form
satisfactory to the Issuing Bank, which is at any time Issued by the
Issuing Bank pursuant to Article III, in each case as amended,
supplemented or otherwise modified from time to time.
"Letter of Credit Liability" means, as of any date of
determination, all then existing liabilities of the Borrower and the
LC Subsidiaries to the Issuing Bank in respect of the Letters of Credit
Issued for the Borrower's account and for the account of the LC
Subsidiaries, whether such liability is contingent or fixed, and shall,
in each case, consist of the sum of (i) the aggregate maximum amount
then available to be drawn under such Letters of Credit (the
determination of such maximum amount to assume compliance with all
conditions for drawing) and (ii) the aggregate amount which has then
been paid by, and not been reimbursed to, the Issuing Bank under such
Letters of Credit. For the purposes of determining the Letter of Credit
Liability, the face amount of Letters of Credit outstanding in an
Alternative Currency shall be expressed as the equivalent of such
Alternative Currency in Dollars.
"Lien" means any assignment, chattel mortgage, pledge or other
security interest or any mortgage, deed of trust or other lien, or other
charge or encumbrance, upon property or rights (including after-acquired
property or rights), or any preferential arrangement with respect to
property or rights (including after-acquired property or rights) which
has the practical effect of constituting a security interest or lien.
"Majority Combined Lenders" means the Lenders having at least 66
2/3% of the aggregate "Credit Exposure." For the purposes hereof,
"Credit Exposure" of any Lender shall mean, at any date of
determination, the maximum dollar amount that such Lender could be then
required by the terms hereof (assuming all conditions to Borrowings and
Issuances were satisfied) to expend to (i) purchase participations in
Letters of Credit pursuant to Section 3.04 hereof (including any amounts
so expended and not reimbursed at the date of determination) and
(ii) fund A Advances (including any amounts so expended to fund
A Advances outstanding on the date of determination).
"Majority A Lenders" means, at any time, A Lenders owed at least
66 2/3% of the then aggregate unpaid principal amount of the A Advances
held by A Lenders, or, if no such principal amount is then outstanding,
A Lenders having at least 66 2/3% of the A Commitments.
"Majority LC Lenders" means, at any time, LC Lenders which have
purchased participations in (pursuant to Section 3.04 hereof) at least
66 2/3% of the Letters of Credit and Letter of Credit Liability then
outstanding, or if no Letters of Credit are then outstanding, LC Lenders
having at least 66 2/3% of the LC Commitments.
"Margin Stock" has the meaning assigned to such term in
Regulation U of the Board of Governors of the Federal Reserve System, as
in effect from time to time.
"Material Adverse Effect" means a material adverse effect on the
financial condition or results of operations of the Borrower and its
Subsidiaries taken as a whole.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any Subsidiary of
the Borrower or any ERISA Affiliate is making or accruing an obligation
to make contributions, or has within any of the preceding five plan
years made or accrued an obligation to make contributions.
"Net Income" of any Person means, for any period, net income
before (i) extraordinary items, (ii) the results of discontinued
operations and (iii) the effect of any cumulative change in accounting
principles, determined in accordance with generally accepted accounting
principles.
"Non-Retail Assets" means property (tangible and intangible) that
is not used, sold or consumed in a Retail Business.
"Non-Retail Business" means, with respect to any Person, that such
Person is not engaged in the Retail Business.
"Notice of A Borrowing" has the meaning specified in Section
2.02(a).
"Notice of B Borrowing" has the meaning specified in Section
2.03(a).
"Obligations" means all obligations of the Borrower and the
LC Subsidiaries now or hereafter existing under this Agreement, whether
for principal (including reimbursement for amounts drawn under Letters
of Credit), interest, fees, expenses, indemnification or otherwise.
"OECD" means the Organization for Economic Cooperation and
Development.
"Payment Office" means, for Dollars, the principal office of the
Issuing Bank in New York City, located on the date hereof at 399 Park
Avenue, New York, New York 10043, and, for any Alternative Currency,
such office of the Issuing Bank as shall be from time to time selected
by the Issuing Bank and notified by the Issuing Bank to the Borrower,
the LC Subsidiaries and the LC Lenders.
"Permitted Lien" means:
(i) Liens for taxes, assessments or governmental charges or
levies to the extent not past due or to the extent contested, in good
faith, by appropriate proceedings and for which adequate reserves have
been established;
(ii) Liens imposed by law, such as materialman's, mechanic's,
carrier's, worker's, landlord's and repairman's Liens and other similar
Liens arising in the ordinary course of business which relate to
obligations which are not overdue for a period of more than 30 days or
which are being contested in good faith, by appropriate proceedings and
for which reserves required by generally accepted accounting principles
have been established;
(iii) pledges or deposits in the ordinary course of business to
secure nondelinquent obligations under worker's compensation or
unemployment laws or similar legislation or to secure the performance of
leases or contracts entered into in the ordinary course of business or
of public or nondelinquent statutory obligations, bids, or appeal bonds;
(iv) Liens upon or in, and limited to, any property acquired or
held by the Borrower or any of its Subsidiaries to secure the purchase
price of such property or to secure indebtedness incurred solely for the
purpose of financing or refinancing the acquisition of any such property
to be subject to such Liens, or Liens existing on any such property at
the time of acquisition;
(v) Liens upon any assets subject to a Capital Lease and
securing payment of the obligations arising under such Capital Lease;
(vi) zoning restrictions, easements, licenses, landlord's Liens
or restrictions on the use of property which do not materially impair
the use of such property in the operation of the business of the
Borrower or any of its Subsidiaries;
(vii) Liens of the Borrower and its Subsidiaries not described in
the foregoing clauses (i) through (vi), existing of the date hereof and
listed on Schedule II hereof;
(viii) Liens not described in subclauses (i) through (vii)
above that relate to liabilities not in excess of $20,000,000 in the
aggregate; and
(ix) extensions, renewals or replacements of Liens described in
subclauses (iv), (v), (vii) and (viii) for the same or lesser amount;
provided, that, no such extension, renewal or replacement shall extend
to or cover any property not theretofore subject to the Lien being
extended, renewed or replaced.
"Person" means an individual, partnership, corporation (including
a business trust), joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any
political subdivision or agency thereof.
"Plan" means an employee benefit plan (other than a Multiemployer
Plan) maintained by the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate for its employees and subject to Title IV of ERISA.
"RCRA" means the Resource Conservation and Recovery Act of 1976,
as amended (42 U.S.C. Sec. 6901 et seq.), and any regulations promulgated
thereunder.
"Reference Banks" means Citibank, N.A., The Hongkong and Shanghai
Banking Corporation Limited and Bank of America National Trust & Savings
Association.
"Responsible Officer" means, with respect to any certificate,
report or notice to be delivered or given hereunder, unless the context
otherwise requires, the president, chief executive officer or chief
financial officer of the Borrower or other executive officer of the
Borrower who in the normal performance of his or her operational duties
would have knowledge of the subject matter relating to such certificate,
report or notice.
"Register" has the meaning specified in Section 10.07(c).
"Retail Assets" means property (tangible and intangible) that is
used, sold or consumed in a Retail Business.
"Retail Business" means, with respect to any Person, that such
Person is engaged in the business of manufacturing, producing,
supplying, distributing or selling apparel, home furnishings,
accessories, specialty foods and related products or goods.
"Revolver Termination Date" means, subject to Section 2.14 hereof,
June 30, 1998 or the earlier date of termination in whole of the
A Commitments pursuant to Section 2.05 or 8.01.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, trust or other Person of which more than 50% of the
outstanding capital stock (or similar property right in the case of
partnerships and trusts) having ordinary voting power to elect a
majority of the board of directors of such corporation (or similar
governing body or Person with respect to partnerships and trusts)
(irrespective of whether or not at the time capital stock of any other
class or classes of such corporation shall or might have voting power
upon the occurrence of any contingency) is at the time directly or
indirectly owned by such Person, by such Person and one or more other
Subsidiaries of such Person, or by one or more other Subsidiaries of
such Person.
"Total Assets" of any Person means all property, whether real,
personal, tangible, intangible or otherwise, which, in accordance with
generally accepted accounting principles, should be included in
determining total assets as shown on the assets portion of a balance
sheet of such Person.
"Type" refers to the distinction among Advances bearing interest
at the Base Rate and Advances bearing interest at the Eurodollar Rate.
"UCP" has the meaning specified in Section 3.08.
SECTION 1.02Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each means "to but excluding".
SECTION 1.03Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the
preparation of the financial statements referred to in Section 6.01(e).
ARTICLE IIAMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01The AAdvances. Each A Lender severally agrees, on the
terms and conditions hereinafter set forth, to make A Advances to the Borrower
from time to time on any Business Day during the period from the date hereof
until the Revolver Termination Date in an aggregate amount not to exceed at
any time outstanding such A Lender's A Commitment, provided, that, the
aggregate amount of the A Commitments of the A Lenders shall be deemed used
from time to time to the extent of the aggregate amount of the B Advances then
outstanding and such deemed use of the aggregate amount of the A Commitments
shall be applied to the A Lenders ratably according to their respective
A Commitments (such deemed use of the aggregate amount of the A Commitments
being a "B Reduction"). Each A Borrowing shall be in an aggregate amount not
less than (i) $15,000,000, in the case of an A Borrowing consisting of
Eurodollar Rate Advances and (ii) $1,000,000, in the case of an A Borrowing
consisting of Base Rate Advances, or, in each case, in integral multiples of
$1,000,000 in excess thereof and shall consist of A Advances of the same Type
made on the same day by the A Lenders ratably according to their respective
A Commitments. Within the limits of each A Lender's A Commitment, the
Borrower may from time to time borrow, prepay pursuant to Section 2.11(b) and
reborrow under this Section 2.01.
SECTION 2.02Making the AAdvances. (a) Each A Borrowing shall be
made on notice given not later than (i) 12:00 noon (New York City time) on the
third Business Day prior to the date of the proposed A Borrowing, if such
proposed A Borrowing consists of Eurodollar Rate Advances and (ii) 10:00 A.M.
(New York City time) on the day of such proposed A Borrowing, if such proposed
A Borrowing consists of Base Rate Advances, by the Borrower to the Agent,
which shall give to each A Lender prompt notice thereof by telecopier, telex
or cable. Each such notice of an A Borrowing (a "Notice of A Borrowing")
shall be by telecopier, telex, cable or telephone (and if by telephone,
confirmed immediately in writing), in substantially the form of Exhibit A-1
hereto, specifying therein the requested (i) date of such A Borrowing,
(ii) Type of A Advances comprising such A Borrowing, (iii) aggregate amount of
such A Borrowing and (iv) in the case of an A Borrowing comprised of
Eurodollar Rate Advances, initial Interest Period for each such A Advance.
Each A Lender shall, before 12:00 noon (New York City time) on the date of
such A Borrowing, make available for the account of its Applicable Lending
Office to the Agent at its address referred to in Section 10.02, in same day
funds, such A Lender's ratable portion of such A Borrowing. After the Agent's
receipt of such funds and upon fulfillment of the applicable conditions set
forth in Article V, the Agent will make such funds available to the Borrower
at the Agent's aforesaid address.
(b) Anything in subsection (a) above to the contrary
notwithstanding, the Borrower may not select Eurodollar Rate Advances for any
A Borrowing if the aggregate amount of such A Borrowing is less than
$1,000,000 multiplied by the number of A Lenders.
(c) Each Notice of A Borrowing shall be irrevocable and binding
on the Borrower. In the case of any A Borrowing which the related Notice of
A Borrowing specifies is to be comprised of Eurodollar Rate Advances, the
Borrower shall indemnify each A Lender against any loss, cost or expense
incurred by such A Lender as a result of any failure to fulfill on or before
the date specified in such Notice of A Borrowing for such A Borrowing the
applicable conditions set forth in Article V, including, without limitation,
any loss (including loss of anticipated profits), cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by such A Lender to fund the A Advance to be made by such A Lender as part of
such A Borrowing when such A Advance, as a result of such failure, is not made
on such date.
(d) Unless the Agent shall have received notice from an A Lender
prior to the date of any A Borrowing that such A Lender will not make
available to the Agent such A Lender's ratable portion of such A Borrowing,
the Agent may assume that such A Lender has made such portion available to the
Agent on the date of such A Borrowing in accordance with subsection (a) of
this Section 2.02 and the Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount. If and to the
extent that such A Lender shall not have so made such ratable portion
available to the Agent, such A Lender and the Borrower severally agree to
repay to the Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Borrower until the date such amount is repaid to the Agent at (i) in the
case of the Borrower, the interest rate applicable at the time to A Advances
comprising such A Borrowing and (ii) in the case of such A Lender, the Federal
Funds Rate. If such A Lender shall repay to the Agent such corresponding
amount, such amount so repaid shall constitute such A Lender's A Advance as
part of such A Borrowing for purposes of this Agreement.
(e) The failure of any A Lender to make the A Advance to be made
by it as part of any A Borrowing shall not relieve any other A Lender of its
obligation, if any, hereunder to make its A Advance on the date of such
A Borrowing, but no A Lender shall be responsible for the failure of any other
A Lender to make the A Advance to be made by such other A Lender on the date
of any A Borrowing.
SECTION 2.03The BAdvances. (a) Each A Lender severally agrees
that the Borrower may make B Borrowings under this Section 2.03 from time to
time on any Business Day during the period from the date hereof until the date
occurring 7 days prior to the Revolver Termination Date in the manner set
forth below; provided, that, following the making of each B Borrowing, the
aggregate amount of the Advances then outstanding shall not exceed the
aggregate amount of the A Commitments of the A Lenders (computed without
regard to any B Reduction).
(i) The Borrower may request a B Borrowing under this Section
2.03 by delivering to the Agent (or to each A Lender if the Borrower is
conducting the auction for B Advances pursuant to subsection (g) of this
Section 2.03), by telecopier, telex or cable, confirmed immediately in
writing, a notice of a B Borrowing (a "Notice of B Borrowing"), in
substantially the form of Exhibit A-2 hereto, specifying the date and
aggregate amount of the proposed B Borrowing, the maturity date for
repayment of each B Advance to be made as part of such B Borrowing
(which maturity date may not be earlier than the date occurring 7 days
after the date of such B Borrowing or later than the Revolver
Termination Date), the interest payment date or dates relating thereto,
and any other terms to be applicable to such B Borrowing, not later than
3:00 P.M. (New York City time) (A) at least one Business Day prior to
the date of the proposed B Borrowing, if the Borrower shall specify in
the Notice of B Borrowing that the rates of interest to be offered by
the A Lenders shall be fixed rates per annum and (B) at least four
Business Days prior to the date of the proposed B Borrowing, if the
Borrower shall instead specify in the Notice of B Borrowing the basis to
be used by the A Lenders in determining the rates of interest to be
offered by them. If the Agent is conducting the auction for B Advances,
it shall in turn promptly notify each A Lender of each request for a
B Borrowing received by it from the Borrower by sending such A Lender a
copy of the related Notice of B Borrowing.
(ii) Each A Lender may, if, in its sole discretion, it
elects to do so, irrevocably offer to make one or more B Advances to the
Borrower as part of such proposed B Borrowing at a rate or rates of
interest specified by such Lender in its sole discretion, by notifying
the Agent (which shall give prompt notice thereof to the Borrower) or
the Borrower (if it is conducting the auction for B Advances pursuant to
subsection (g) of this Section 2.03), before 10:30 A.M. (New York City
time) (A) on the date of such proposed B Borrowing, in the case of a
Notice of B Borrowing delivered pursuant to clause (A) of paragraph (i)
above and (B) three Business Days before the date of such proposed
B Borrowing, in the case of a Notice of B Borrowing delivered pursuant
to clause (B) of paragraph (i) above, of the minimum amount and maximum
amount of each B Advance which such A Lender would be willing to make as
part of such proposed B Borrowing (which amounts may, subject to the
proviso to the first sentence of this Section 2.03(a), exceed such
A Lender's A Commitment), the rate or rates of interest therefor and
such A Lender's Applicable Lending Office with respect to such
B Advance; provided, that, if the Agent in its capacity as an A Lender
shall, in its sole discretion, elect to make any such offer and the
Agent is conducting the auction for B Advances, it shall notify the
Borrower of such offer before 10:00 A.M. (New York City time) on the
date on which notice of such election is to be given to the Agent by the
other A Lenders. If any A Lender shall elect not to make such an offer,
such A Lender shall so notify the Agent, or the Borrower (if it is
conducting the auction for the B Advances pursuant to subsection (g) of
this Section 2.03), before 10:30 A.M. (New York City time) on the date
on which notice of such election is to be given to the Agent or the
Borrower (if it is conducting the auction for the B Advances pursuant to
subsection (g) of this Section 2.03) by the other A Lenders, and such
A Lender shall not be obligated to, and shall not, make any B Advance as
part of such B Borrowing; provided, that, the failure by any A Lender to
give such notice shall not cause such A Lender to be obligated to make
any B Advance as part of such proposed B Borrowing.
(iii) The Borrower shall, in turn, (A) before 12:00 noon (New York
City time) on the date of such proposed B Borrowing, in the case of a
Notice of B Borrowing delivered pursuant to clause (A) of paragraph (i)
above and (B) before 1:00 P.M. (New York City time) three Business Days
before the date of such proposed B Borrowing, in the case of a Notice of
B Borrowing delivered pursuant to clause (B) of paragraph (i) above,
either:
(x) cancel such B Borrowing by giving the Agent (or each
A Lender if the Borrower is conducting the auction for the
B Advances pursuant to subsection (g) of this Section 2.03) notice
to that effect; or
(y) accept one or more of the offers made by any A Lender
or A Lenders pursuant to paragraph (ii) above, in its sole
discretion, by giving notice to the Agent (or each such A Lender,
if the Borrower is conducting the auction for B Advances pursuant
to subsection (g) of this Section 2.03) of the amount of each
B Advance (which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum amount,
notified to the Borrower by the Agent on behalf of such A Lender
(or by each A Lender, if the Borrower is conducting the auction
for B Advances pursuant to subsection (g) of this Section 2.03)
for such B Advance pursuant to paragraph (ii) above) to be made by
each A Lender as part of such B Borrowing, and reject any
remaining offers made by A Lenders pursuant to paragraph (ii)
above by giving the Agent (or each A Lender, if the Borrower is
conducting the auction for B Advances pursuant to subsection (g)
of this Section 2.03) notice to that effect.
(iv) If the Borrower notifies the Agent that such
B Borrowing is cancelled pursuant to paragraph (iii)(x) above, the Agent
shall give prompt notice thereof to the A Lenders, and such B Borrowing
shall not be made.
(v) If the Borrower accepts one or more of the offers made by
any A Lender or A Lenders pursuant to paragraph (iii)(y) above, the
Agent, if it is conducting the auction for the B Advances, or the
Borrower, if it is conducting the auction for the B Advances pursuant to
subsection (g) of this Section 2.03, shall promptly notify (A) each
A Lender that has made an offer as described in paragraph (ii) above, of
the date and aggregate amount of such B Borrowing, of the lowest and
highest interest rates offered to the Borrower by the A Lenders in
connection with such B Borrowing and whether or not any offer or offers
made by such A Lender pursuant to paragraph (ii) above have been
accepted by the Borrower and (B) each A Lender that is to make a
B Advance as part of such B Borrowing, of the amount of each B Advance
to be made by such A Lender as part of such B Borrowing. If the
Borrower is conducting the auction for the B Advances pursuant to
subsection (g) of this Section 2.03, it shall concurrently with the
notices given by it to the A Lenders pursuant to the previous sentence,
provide a copy of all such notices to the Agent. The Agent shall in turn
notify each A Lender that is to make a B Advance as part of such
B Borrowing, upon receipt, that the Agent has received forms of
documents appearing to fulfill the applicable conditions set forth in
Article V. Each A Lender that is to make a B Advance as part of such
B Borrowing shall, before 2:00 P.M. (New York City time) on the date of
such B Borrowing specified in the notice received from the Agent (or
from the Borrower if it is conducting the auction for B Advances
pursuant to subsection (g) of this Section 2.03) pursuant to clause (A)
above or any later time when such A Lender shall have received notice
from the Agent pursuant to the preceding sentence, make available (i) if
the Agent is conducting the auction for B Advances, to the Agent for the
account of its Applicable Lending Office at its address referred to in
Section 10.02 such A Lender's portion of such B Borrowing, in same day
funds or (ii) if the Borrower is conducting the auction for B Advances
pursuant subsection (g) of this Section 2.03, to the Borrower at the
account designated by it, such A Lender's portion of such B Borrowing,
in same day funds. Upon fulfillment of the applicable conditions set
forth in Article V, and after receipt by the Agent of such funds (if the
Agent conducted the auction relating to such B Borrowing), the Agent
will make such funds available to the Borrower at the Agent's aforesaid
address. Promptly after each B Borrowing the Agent will notify each
A Lender of the amount of the B Borrowing, the consequent B Reduction
and the dates upon which such B Reduction commenced and will terminate.
(b) Each B Borrowing shall be in an aggregate amount not less
than $5,000,000 or an integral multiple of $1,000,000 in excess thereof and,
following the making of each B Borrowing, the Borrower shall be in compliance
with the limitation set forth in the proviso to the first sentence of
subsection (a) above. The Borrower may not accept offers for B Advances in
excess of the aggregate amount specified in its Notice of B Borrowing given
with respect to each proposed B Borrowing.
(c) Within the limits and on the conditions set forth in this
Section 2.03, the Borrower may from time to time borrow under this Section
2.03, repay or prepay pursuant to subsection (d) below, and reborrow under
this Section 2.03. The Borrower may not make more than one B Borrowing on any
Business Day.
(d) If the Agent conducted the applicable auction relating to
the B Advance to be repaid, the Borrower shall repay to the Agent for the
account of each A Lender which has made a B Advance on the maturity date of
each B Advance (such maturity date being that specified by the A Lender for
repayment of such B Advance in the related offer delivered pursuant to
subsection (a)(ii) above), the then unpaid principal amount of such B Advance.
If the Borrower conducted the applicable auction relating to the B Advance to
be repaid, the Borrower shall repay directly to each A Lender that made a
B Advance on the maturity date of each B Advance (such maturity date being
that specified by the A Lender for repayment of such B Advance in the related
offer delivered pursuant to subsection (a)(ii) above), the then unpaid
principal amount of such B Advance at the account designated by such A Lender
to the Borrower. The Borrower shall have no right to prepay any principal
amount of any B Advance unless, and then only on the terms, specified for such
B Advance in the offer delivered pursuant to subsection (a)(ii) above.
(e) The Borrower shall pay interest on the unpaid principal
amount of each B Advance from the date of such B Advance to the date the
principal amount of such B Advance is repaid in full, at the rate of interest
for such B Advance specified by the A Lender making such B Advance in its
offer with respect thereto delivered pursuant to subsection (a)(ii) above,
payable on the interest payment date or dates specified by the Borrower in its
Notice of B Borrowing with respect thereto delivered pursuant to subsection
(a)(i) above. Such interest shall be paid directly to the A Lender that made
the B Advance at the account designated by it to the Borrower, if the Borrower
conducted the applicable auction relating to the B Advance on which interest
is to be paid, and to the Agent for the account the Applicable Lending Office
of each A Lender that made a B Advance, if the Agent conducted the auction
relating to the B Advance on which interest is to be paid.
(f) The indebtedness of the Borrower to an A Lender resulting
from each B Advance made to the Borrower as part of a B Borrowing shall be
evidenced by such A Lender's loan account referred to in Section 4.04;
provided, however, that upon the request of such A Lender, the Borrower shall
execute and deliver to such A Lender a promissory note, in substantially the
form of Exhibit E hereto, in the face amount of the B Advance made by such A
Lender as part of a B Borrowing.
(g) If the Borrower so elects, it may conduct, from time to
time, auctions for B Advances in accordance with the foregoing provisions.
SECTION 2.04Fees. (a) Facility Fee. The Borrower agrees to pay
to the Agent for the account of each A Lender a facility fee, accruing at the
rate of 0.06% from and after the date hereof, on the amount of such A Lender's
A Commitment (computed without giving effect to any B Reduction or any other
usage of the A Commitment of such A Lender), payable quarterly in arrears on
the last day of each January, April, July and October and on the Revolver
Termination Date.
(b) Utilization Fee. The Borrower agrees to pay to the Agent
for the account of each A Lender a utilization fee, accruing, during all
periods from and after the date hereof when the aggregate amount of
outstanding A Advances made by such A Lender exceeds 50% of such A Lender's A
Commitment (without regard to any usage thereof), at the rate of 0.05%
per annum on the aggregate amount of such A Advances outstanding from time to
time during such periods, payable quarterly in arrears on the last day of each
January, April, July and October and on the Revolver Termination Date.
(c) Other Fees. The Borrower hereby agrees to pay the fees and
charges referred to in that certain letter agreement, dated as of the date
hereof, among the Borrower, the Issuing Bank and the Agent.
SECTION 2.05Reduction and Increase of the ACommitments. (a) The
Borrower shall have the right, upon at least three Business Days' notice to
the Agent, to irrevocably terminate in whole or reduce ratably in part the
unused portions of the respective A Commitments of the A Lenders, provided,
that, the aggregate amount of the A Commitments of the A Lenders shall not be
reduced to an amount which is less than the aggregate principal amount of the
B Advances then outstanding and provided, further, that each partial reduction
shall be in the aggregate amount of $25,000,000 or an integral multiple of
$1,000,000 in excess thereof.
(b) Not more frequently than once in any period of twelve
consecutive calendar months occurring after the date hereof, the Borrower
shall have the right prior to the Revolver Termination Date to increase the
amount of the A Commitments of one or more A Lenders (each such increase being
an "A Commitment Increase"), provided that such A Lenders shall have consented
to such A Commitment Increase (which consent may be granted or withheld by any
A Lender in its sole and absolute discretion), on and subject to the following
terms:
(i) The aggregate amount of all A Commitment Increases and
LC Commitment Increases shall not exceed $200,000,000 after the date
hereof;
(ii) The aggregate amount of each A Commitment Increase
shall be in a minimum amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof;
(iii) Each A Commitment Increase shall increase the
aggregate amount of the A Commitments by the same amount;
(iv) No proposed A Commitment Increase shall occur unless
each of the following requirements in respect thereof shall have been
satisfied:
(A) The Agent shall have received from the Borrower
an irrevocable written notice (an "A Commitment Increase Notice"),
dated not earlier than 60 days before the proposed A Commitment
Increase Effective Date (as defined below) therefor and not later
than 30 days before such proposed A Commitment Increase Effective
Date, that (1) specifies (x) the aggregate amount of the proposed
A Commitment Increase, (y) the A Lenders whose A Commitments are
to be increased by the proposed A Commitment Increase and the
amount by which each such A Lender's A Commitment is to be so
increased and (z) the date (the "A Commitment Increase Effective
Date") on which the proposed A Commitment Increase shall become
effective, and (2) has been signed by each A Lender whose A
Commitment is to be increased, evidencing the consent of such A
Lender to the proposed A Commitment Increase;
(B) On and as of the A Commitment Increase Effective
Date of the proposed A Commitment Increase (1) the following
statements shall be true (and the giving of the applicable A
Commitment Increase Notice shall constitute a representation and
warranty by the Borrower that on such A Commitment Increase
Effective Date such statements are true):
(x) The representations and warranties
contained in Section 6.01 are correct on and as of
such A Commitment Increase Effective Date before and
after giving effect to the proposed A Commitment
Increase, as though made on and as of such date, and
(y) No event has occurred and is continuing,
or would result from such A Commitment Increase, which
constitutes an Event of Default or Default; and
(2) the Agent shall have received such other approvals, opinions
or documents as the Agent may reasonably request;
(v) Promptly following its receipt of an A Commitment
Increase Notice in proper form, the Agent shall deliver copies thereof
to each Lender. If, and only if, all of the terms, conditions and
requirements specified in paragraphs (i) through (iv) are satisfied in
respect of any proposed A Commitment on and as of the proposed A
Commitment Increase Effective Date thereof, then, as of such A
Commitment Increase Effective Date and from and after such date, (1) the
A Commitments of the A Lenders consenting to such A Commitment Increase
shall be increased by the respective amounts specified in the A
Commitment Increase Notice pertaining thereto and (2) references herein
to the amounts of the A Lenders' respective A Commitments shall refer to
respective amounts giving effect to such A Commitment Increase;
(vi) It is understood that no A Lender shall have any
obligation whatsoever to agree to any request made by the Borrower for
an A Commitment Increase;
(vii) On each A Commitment Increase Effective Date, each A
Lender whose A Commitment has been increased (each such A Lender being
an "Increasing A Lender") shall, before 12:00 noon (New York City time)
on such A Commitment Increase Effective Date, make available for the
account of its Applicable Lending Office to the Agent at the address
specified in Section 10.02, in same day funds, an amount equal to the
excess of (A) such Increasing A Lenders' ratable portion of the A
Borrowings then outstanding (calculated based on its A Commitment as a
percentage of the aggregate A Commitments of the A Lenders outstanding
after giving effect to the relevant A Commitment Increase) over (B) the
aggregate principal amount of then outstanding A Advances made by such
Increasing A Lender; and
(viii) After the Agent's receipt of such funds from
each such Increasing A Lender, the Agent will promptly thereafter cause
to be distributed like funds to the other A Lenders for the account of
their respective Applicable Lending Offices in an amount to each other A
Lender such that the aggregate amount of the outstanding A Advances
owing to each A Lender after giving effect to such distribution equals
such A Lender's ratable portion of the A Borrowings then outstanding
(calculated based on its aggregate A Commitments as a percentage of the
aggregate A Commitments of the A Lenders outstanding after giving effect
to the relevant A Commitment Increase). If the A Commitment Increase
Effective Date shall occur on a date that is not the last day of the
Interest Period for all Eurodollar Rate Advances then outstanding, (1)
the Borrower shall pay any amounts owing pursuant to Section 10.04(b) as
a result of the distributions to A Lenders under this Section 2.05(b)
and (2) for each A Borrowing comprised of Eurodollar Rate Advances, the
respective A Advances made by the Increasing A Lenders pursuant to this
Section 2.05(b) in respect of such A Borrowing shall be Base Rate
Advances until the last day of the then existing Interest Period for
such A Borrowing.
SECTION 2.06Repayment of AAdvances. The Borrower shall repay in
full the principal amount of each A Advance owing to each A Lender, together
with accrued interest and fees thereon, on the Revolver Termination Date.
SECTION 2.07Interest on AAdvances. The Borrower shall pay
interest on the unpaid principal amount of each A Advance made by each
A Lender from the date of such A Advance until such principal amount shall be
paid in full, at the following rates per annum:
(a) Base Rate Advances. If such A Advance is a Base Rate
Advance, a rate per annum equal at all times to the Base Rate in effect
from time to time, payable quarterly on the last day of each April,
July, October, and January and on the date such Base Rate Advance shall
be Converted or paid in full; provided, that, any amount of principal
which is not paid when due (whether at stated maturity, by acceleration
or otherwise) shall bear interest, from the date on which such amount is
due until such amount is paid in full, payable on demand, at a rate per
annum equal at all times to 2% per annum above the Base Rate in effect
from time to time.
(b) Eurodollar Rate Advances. If such A Advance is a Eurodollar
Rate Advance, a rate per annum equal at all times during the Interest
Period for such A Advance to the sum of the Eurodollar Rate for such
Interest Period plus the Eurodollar Rate Margin, payable on the last day
of such Interest Period and, if such Interest Period has a duration of
more than three months, on each day which occurs during such Interest
Period every three months from the first day of such Interest Period;
provided, that, any amount of principal which is not paid when due
(whether at stated maturity, by acceleration or otherwise) shall bear
interest, from the date on which such amount is due until such amount is
paid in full, payable on demand, at a rate per annum equal at all times
to (x) after the expiration of the Interest Period related to such
principal amount, 2% per annum above the Base Rate in effect from time
to time and (y) prior to the expiration of the Interest Period related
to such principal amount, 2% per annum above the rate per annum required
to be paid on such A Advance immediately prior to the date on which such
principal amount became due.
SECTION 2.08Additional Interest on Eurodollar Rate Advances. The
Borrower shall pay to each A Lender, so long as such A Lender shall be
required under regulations of the Board of Governors of the Federal Reserve
System to maintain reserves with respect to liabilities or assets consisting
of or including Eurocurrency Liabilities, additional interest on the unpaid
principal amount of each Eurodollar Rate Advance of such A Lender, from the
date of such A Advance until such principal amount is paid in full, at an
interest rate per annum equal at all times to the remainder obtained by
subtracting (i) the Eurodollar Rate for the Interest Period for such A Advance
from (ii) the rate obtained by dividing such Eurodollar Rate by a percentage
equal to 100% minus the Eurodollar Rate Reserve Percentage of such A Lender
for such Interest Period, payable on each date on which interest is payable on
such A Advance. Such additional interest shall be determined by such A Lender
and notified to the Borrower through the Agent.
SECTION 2.09Interest Rate Determination. (a) Each Reference Bank
agrees to furnish to the Agent timely information for the purpose of
determining the Eurodollar Rate. If any one or more of the Reference Banks
shall not furnish such timely information to the Agent for the purpose of
determining such interest rate, the Agent shall determine such interest rate
on the basis of timely information furnished by the remaining Reference
Banks. The Agent shall give prompt notice to the Borrower and the A Lenders
of the applicable interest rate determined by the Agent for purposes of
Section 2.07(a) or (b), and the applicable rate, if any, furnished by each
Reference Bank for the purpose of determining the applicable interest rate
under Section 2.07(b).
(b) If, with respect to any Eurodollar Rate Advances, the
Majority A Lenders notify the Agent that the Eurodollar Rate for any Interest
Period for such Advances will not adequately reflect the cost to such Majority
A Lenders of making, funding or maintaining their respective Eurodollar Rate
Advances for such Interest Period, the Agent shall forthwith so notify the
Borrower and the A Lenders, whereupon:
(i) each outstanding Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period
therefor, Convert into a Base Rate Advance, and
(ii) the obligation of the A Lenders to make, or to
Convert A Advances into, Eurodollar Rate Advances shall be suspended
until the Agent shall notify the Borrower and the A Lenders that the
circumstances causing such suspension no longer exist.
(c) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01,
the Agent will forthwith so notify the Borrower and the A Lenders and such
Advances will automatically, on the last day of the then existing Interest
Period therefor, Convert into Base Rate Advances.
(d) On the date on which the aggregate unpaid principal amount
of A Advances comprising any A Borrowing shall be reduced, by payment or
prepayment or otherwise, to less than $1,000,000 multiplied by the number of
A Lenders, such A Advances shall, if they are A Advances of a Type other than
Base Rate Advances, automatically Convert into Base Rate Advances, and on and
after such date the right of the Borrower to Convert such A Advances into A
Advances of a Type other than Base Rate Advances shall terminate; provided,
however, that if and so long as each such A Advance shall be of the same Type
and have the same Interest Period as A Advances comprising another
A Borrowing or other A Borrowings, and the aggregate unpaid principal amount
of all such A Advances shall equal or exceed $1,000,000 multiplied by the
number of A Lenders, the Borrower shall have the right to continue all such
A Advances as, or to Convert all such A Advances into, A Advances of such Type
having such Interest Period.
(e) If fewer than two Reference Banks furnish timely information
to the Agent for determining the Eurodollar Rate for any Eurodollar Rate
Advances,
(i) the Agent shall forthwith notify the Borrower and the
A Lenders that the interest rate cannot be determined for such
Eurodollar Rate Advances,
(ii) each such A Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base
Rate Advance (or if such A Advance is then a Base Rate Advance, will
continue as a Base Rate Advance), and
(iii) the obligation of the A Lenders to make, or to Convert
A Advances into, Eurodollar Rate Advances shall be suspended until the
Agent shall notify the Borrower and the Lenders that the circumstances
causing such suspension no longer exist.
SECTION 2.10Voluntary Conversion of AAdvances. The Borrower may
on any Business Day, upon notice given to the Agent not later than 12:00 noon
(New York City time) on the third Business Day prior to the date of the
proposed Conversion and subject to the provisions of Sections 2.09 and 2.13,
Convert all A Advances of one Type comprising the same A Borrowing into A
Advances of another Type; provided, however, that any Conversion of any
Eurodollar Rate Advances into A Advances of another Type shall be made on, and
only on, the last day of an Interest Period for such Eurodollar Rate Advances.
Each such notice of a Conversion shall, within the restrictions specified
above, specify (i) the date of such Conversion, (ii) the A Advances to be
Converted, and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the Interest Period for each such A Advance.
SECTION 2.11No Prepayments of AAdvances. (a) The Borrower shall
have no right to prepay any principal amount of any A Advances other than as
provided in subsection (b) below or Section 2.14.
(b) The Borrower may, upon at least (i) two Business Day's, in
the case of Eurodollar Rate Advances and (ii) same Business Day's, in the case
of Base Rate Advances, notice to the Agent (to be received by the Agent prior
to 12:00 noon (New York City time) stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given the Borrower
shall, prepay the outstanding principal amounts of the A Advances comprising
part of the same A Borrowing in whole or ratably in part, together with
accrued interest to the date of such prepayment on the principal amount
prepaid; provided, however, that (x) each partial prepayment shall be in an
aggregate principal amount not less than $15,000,000 if made with respect to
Eurodollar Rate Advances, or $1,000,000, if made with respect to Base Rate
Advances, and in each case in $1,000,000 integral multiples in excess thereof
and (y) in the case of any such prepayment of a Eurodollar Rate Advance, the
Borrower shall be obligated to reimburse the A Lenders in respect thereof
pursuant to Section 10.04(b).
SECTION 2.12Increased Costs. (a) If, due to either (i) the
introduction of or any change at any time after the date of this Agreement
(other than any change by way of imposition or increase of reserve
requirements in the case of Eurodollar Rate Advances, included in the
Eurodollar Rate Reserve Percentage) in or in the interpretation of any law or
regulation or (ii) the compliance after the date of this Agreement with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
cost to any A Lender of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances, then the Borrower shall from time to time, upon
demand by such A Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such A Lender additional amounts sufficient to
compensate such A Lender for such increased cost; provided, that, the Borrower
shall have no obligation to reimburse any A Lender for increased costs
incurred more than 60 days prior to the date of such demand. A certificate as
to the amount of such increased cost setting forth the basis for the
calculation of such increased costs, submitted to the Borrower and the Agent
by such A Lender, shall be conclusive and binding for all purposes, absent
manifest error.
(b) If, at any time after the date of this Agreement, any
A Lender determines that compliance with any law or regulation or any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law) affects or would affect the amount of
capital required or expected to be maintained by such A Lender or any
corporation controlling such A Lender and that the amount of such capital is
increased by or based upon the existence of such A Lender's commitment to lend
hereunder and other commitments of this type, then, upon demand by such
A Lender (with a copy of such demand to the Agent), the Borrower shall
immediately pay to the Agent for the account of such A Lender, from time to
time as specified by such A Lender, additional amounts sufficient to
compensate such A Lender or such corporation in the light of such
circumstances, to the extent that such A Lender reasonably determines such
increase in capital to be allocable to the existence of such A Lender's
commitment to lend hereunder; provided, that, the Borrower shall have no
obligation to pay such compensatory amounts that relate to an actual increase
in the capital of such A Lender undertaken by such A Lender more than 60 days
prior to the date of such demand. A certificate as to such amounts submitted
to the Borrower and the Agent by such A Lender and setting forth the basis for
the calculation of such amount shall be conclusive and binding for all
purposes, absent manifest error.
(c) Without affecting its rights under Sections 2.12(a) or
2.12(b) or any other provision of this Agreement, each A Lender agrees that if
there is any increase in any cost to or reduction in any amount receivable by
such A Lender with respect to which the Borrower would be obligated to
compensate such A Lender pursuant to Sections 2.12(a) or 2.12(b), such
A Lender shall use reasonable efforts to select an alternative Applicable
Lending Office which would not result in any such increase in any cost to or
reduction in any amount receivable by such A Lender; provided, however, that
no A Lender shall be obligated to select an alternative Applicable Lending
Office if such A Lender determines that (i) as a result of such selection such
A Lender would be in violation of any applicable law, regulation, treaty, or
guideline, or would incur additional costs or expenses or (ii) such selection
would be inadvisable for regulatory reasons or inconsistent with the interests
of such A Lender.
(d) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.12 shall survive the payment in full (after the
Revolver Termination Date) of all Obligations.
SECTION 2.13Illegality. (a) Notwithstanding any other provision
of this Agreement, if any A Lender shall notify the Agent that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful or impossible, or any central bank or other
governmental authority asserts that it is unlawful, for any A Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to fund or maintain Eurodollar Rate Advances
hereunder, (i) the obligation of the A Lenders to make, or to Convert
A Advances into, Eurodollar Rate Advances shall be suspended until the Agent
shall notify the Borrower and the A Lenders that the circumstances causing
such suspension no longer exist and (ii) the Borrower shall forthwith prepay
in full all Eurodollar Rate Advances of all A Lenders then outstanding,
together with interest accrued thereon, unless the Borrower, within five
Business Days of notice from the Agent, Converts all Eurodollar Rate Advances
of all A Lenders then outstanding into A Advances of another Type in
accordance with Section 2.10.
(b) Without affecting its rights under Section 2.13(a) or under
any other provision of this Agreement, each A Lender agrees that if it becomes
unlawful or impossible for such A Lender to make, maintain or fund its
Eurodollar Rate Advances as contemplated by this Agreement, such A Lender
shall use reasonable efforts to select an alternative Applicable Lending
Office from which such A Lender may maintain and give effect to its
obligations under this Agreement with respect to making, funding and
maintaining such Eurodollar Rate Advances; provided, however, that no A Lender
shall be obligated to select an alternative Applicable Lending Office if such
A Lender determines that (i) as a result of such selection such A Lender would
be in violation of any applicable law, regulation, or treaty, or would incur
additional costs or expenses or (ii) such selection would be inadvisable for
regulatory reasons or inconsistent with the interests of such A Lender.
SECTION 2.14 Extension of Revolver Termination Date. At least
30 but not more than 45 days prior to the next Revolver Termination Date, the
Borrower, by written notice to the Agent, may request that the
Revolver Termination Date be extended for a period of 364 days from its then
current scheduled expiration. The Agent shall promptly notify each A Lender
of such request, and each A Lender shall in turn, within 20 days prior to such
Revolver Termination Date, notify the Borrower and the Agent in writing
regarding whether such A Lender will consent to such extension. If, and only
if, (i) the Majority A Lenders consent in writing to such extension prior to
the tenth day preceding such Revolver Termination Date and (ii) the Majority
LC Lenders and the Issuing Bank consent to an extension of the LC Termination
Date pursuant to Section 3.11, the Revolver Termination Date shall be so
extended for such 364-day period and references herein to the
"Revolver Termination Date" shall refer to such "Revolver Termination Date" as
so extended. If any A Lender shall fail to deliver such notice to the
Borrower and the Agent as provided above (each such A Lender being a
"Declining A Lender"), such Declining A Lender shall be deemed not to have
consented to any requested extension, such Declining A Lenders' A Commitments
shall terminate on the scheduled Revolver Termination Date and on such
scheduled Revolver Termination Date, the Borrower shall repay in full the
principal amount of A Advances owing to such Declining A Lender, together with
accrued interest thereon to the date of payment of such principal amount, all
fees payable to such Declining A Lender and all other amounts payable to such
Declining A Lender under this Agreement (including, but not limited to, any
increased costs or other additional amounts owing under Section 2.12, any
indemnification for Taxes or Other Taxes under Section 4.02, or any amounts
which may be required to be paid by the Borrower pursuant to Section
10.04(b)). It is understood that no A Lender shall have any obligation
whatsoever to agree to any request made by the Borrower for an extension of
the Revolver Termination Date.
ARTICLE IIIAMOUNT AND TERMS OF LETTERS OFCREDIT AND PARTICIPATION THEREIN
SECTION 3.01Letters of Credit. The Issuing Bank agrees, on the
terms and conditions hereinafter set forth, to Issue for the account of the
Borrower or any LC Subsidiary, one or more Letters of Credit from time to time
during the period from the date of this Agreement until the LC Termination
Date in an aggregate undrawn amount not to exceed at any time the LC
Commitments of the LC Lenders in effect at such time (inclusive of the Dollar
equivalent of Letters of Credit Issued in an Alternative Currency), each such
Letter of Credit upon its Issuance to expire on or before the date which
occurs one year from the date of its Issuance; provided, however, that the
Issuing Bank shall not be obligated to Issue any Letter of Credit if:
(i) after giving effect to the Issuance of such Letter of
Credit, the then outstanding aggregate amount of all Letter of Credit
Liability shall exceed the total of the LC Commitments of the
LC Lenders;
(ii) the Agent or the Majority LC Lenders shall have notified the
Issuing Bank and the Borrower that no further Letters of Credit are to
be Issued by the Issuing Bank due to failure to meet any of the
applicable conditions set forth in Article V, and such notice has not
expired or been withdrawn; or
(iii) after giving effect to the Issuance of any Letter of Credit
denominated in an Alternative Currency, the then outstanding aggregate
amount of all Letter of Credit Liability with respect to all Letters of
Credit denominated in an Alternative Currency equals or exceeds (on a
Dollar equivalent basis) $75,000,000.
Within the limits of the obligations of the Issuing Bank set forth above, the
Borrower and each LC Subsidiary may request the Issuing Bank to Issue one or
more Letters of Credit, reimburse the Issuing Bank for payments made
thereunder pursuant to Section 3.03(a) and request the Issuing Bank to Issue
one or more additional Letters of Credit under this Section 3.01.
SECTION 3.02Issuing the Letters of Credit. Each Letter of Credit
shall be Issued on notice from the Borrower or any LC Subsidiary, as the case
may be, to the Issuing Bank as provided in the application and agreement
governing such Letter of Credit specifying the date, amount, currency, expiry
and beneficiary thereof, accompanied by such documents as the Issuing Bank may
specify to the Borrower or LC Subsidiary, as the case may be, in form and
substance satisfactory to the Issuing Bank. On the date specified by the
Borrower or LC Subsidiary, as the case may be, in such notice and upon
fulfillment of the applicable conditions set forth in Section 3.01, the
Issuing Bank will Issue such Letter of Credit and shall promptly notify the
Agent thereof.
SECTION 3.03Reimbursement Obligations. (a) The Borrower or the
appropriate LC Subsidiary, as the case may be, shall:
(i) pay to the Issuing Bank an amount equal to, and in
reimbursement for, each amount which such Issuing Bank pays under any
Letter of Credit not later than the date which occurs one Business Day
after payment of such amount by such Issuing Bank under such Letter of
Credit; and
(ii) pay to the Issuing Bank interest on any amount
remaining unpaid under clause (i) above from the date on which such
Issuing Bank pays such amount under any Letter of Credit until such
amount is reimbursed in full to such Issuing Bank pursuant to clause (i)
above, payable on demand, at a fluctuating rate per annum equal to the
sum of the Base Rate in effect from time to time plus 2% per annum.
(b) All amounts to be reimbursed to the Issuing Bank in
accordance with subsection (a) above may, subject to the limitations set forth
in Section 2.01 (inclusive of the minimum borrowing limitations), be paid from
the proceeds of A Advances or B Advances.
SECTION 3.04Participations Purchased by the Lenders. (a) On the
date of Issuance of each Letter of Credit the Issuing Bank shall be deemed
irrevocably and unconditionally to have sold and transferred to each LC Lender
without recourse or warranty, and each LC Lender shall be deemed to have
irrevocably and unconditionally purchased and received from such Issuing Bank,
an undivided interest and participation, to the extent of such Lender's
LC Commitment Percentage in effect from time to time, in such Letter of Credit
and all Letter of Credit Liability relating to such Letter of Credit and all
documents securing, guaranteeing, supporting, or otherwise benefiting the
payment of such Letter of Credit Liability. The Agent or the Issuing Bank
will notify each Lender promptly after the close of each calendar month of all
Letters of Credit then outstanding and of their respective dates of Issue,
outstanding amounts (on a Dollar equivalent basis) as at the end of such
month, currency, expiry dates and reference numbers.
(b) In the event that any reimbursement obligation under
Section 3.03(a) is not paid when due to the Issuing Bank with respect to any
Letter of Credit, the Issuing Bank shall promptly notify the LC Lenders of the
amount of such reimbursement obligation (on a Dollar equivalent basis in the
case of Letters of Credit denominated in an Alternative Currency) and each
LC Lender shall immediately pay to the Issuing Bank, in lawful money of the
United States and in same day funds, an amount equal to such LC Lender's
LC Commitment Percentage then in effect of the amount of such unpaid
reimbursement obligation with interest at the Federal Funds Rate for each day
after such notification until such amount is paid to the Issuing Bank.
(c) Promptly after the Issuing Bank receives a payment
(including interest payments) on account of a reimbursement obligation with
respect to any Letter of Credit, such Issuing Bank shall promptly pay to each
LC Lender which funded its participation therein, in lawful money of the
United States the Dollar equivalent of funds so received, in an amount equal
to such LC Lender's Commitment Percentage thereof.
(d) Upon the request of any LC Lender, the Agent shall furnish,
or cause the Issuing Bank to furnish, to such LC Lender copies of any
outstanding Letter of Credit and any application and agreement for letter of
credit as may be reasonably requested by such LC Lender.
(e) The obligation of each LC Lender to make payments under
subsection (b) above shall be unconditional and irrevocable and shall remain
in effect after the occurrence of the LC Termination Date with respect to any
Letter of Credit that was Issued by the Issuing Bank on behalf of the Borrower
or any LC Subsidiary on or before the LC Termination Date and such payments
shall be made under all circumstances, including, without limitation, any of
the circumstances referred to in Section 3.06(b) other than in connection with
circumstances involving any willful misconduct or gross negligence of the
Issuing Bank in Issuing a Letter of Credit or in determining whether documents
presented under a Letter of Credit comply with the terms thereof.
(f) If any payment received on account of any reimbursement
obligation with respect to a Letter of Credit and distributed to a LC Lender
as a participant under Section 3.04(c) is thereafter recovered from the
Issuing Bank in connection with any bankruptcy or insolvency proceeding
relating to the Borrower or an LC Subsidiary, each LC Lender which received
such distribution shall, upon demand by the Issuing Bank, repay to such
Issuing Bank such LC Lender's ratable share of the amount so recovered
together with an amount equal to such LC Lender's ratable share (according to
the proportion of (i) the amount of such LC Lender's required repayment to
(ii) the total amount so recovered) of any interest or other amount paid or
payable by such Issuing Bank in respect of the total amount so recovered.
SECTION 3.05Letter of Credit Fees. (a) Facility Fee. The
Borrower hereby agrees to pay to each LC Lender (in accordance with its
LC Commitment Percentage) a letter of credit facility fee, accruing at a rate
of 0.06% per annum from and after the date hereof, (i) on the total amount of
LC Commitments from time to time from and after such date (regardless of the
actual or deemed usage thereof) payable quarterly in arrears on the last day
of each January, April, July and October and on the LC Termination Date and
(ii) on the aggregate amount of Letter of Credit Liability under all Letters
of Credit that are outstanding beyond the LC Termination Date (regardless of
the actual or deemed usage thereof) payable in arrears on the last day of each
January, April, July and October and on the first day after the LC Termination
Date on which no Letters of Credit are outstanding.
(b) Issuing Bank Fees. The Borrower hereby agrees to pay to the
Issuing Bank the fees and charges referred to in that certain letter
agreement, dated as of the date hereof, among the Borrower, the Issuing Bank
and the Agent.
SECTION 3.06Indemnification; Nature of the Issuing Bank's Duties.
(a) The Borrower agrees to indemnify and save harmless the Agent, the Issuing
Bank and each Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys' fees) which the Agent, such Issuing Bank or such Lender
may incur or be subject to as a consequence, direct or indirect, of (i) the
Issuance of any Letter of Credit or (ii) any action or proceeding relating to
a court order, injunction, or other process or decree restraining or seeking
to restrain the Issuing Bank from paying any amount under any Letter of
Credit; provided, that, the Issuing Bank shall not be indemnified for any of
the foregoing caused by its gross negligence or willful misconduct.
(b) The obligations of the Borrower and each LC Subsidiary
hereunder with respect to Letters of Credit shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms hereof
under all circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of any Letter
of Credit or this Agreement or any agreement or instrument
relating thereto;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any LC Subsidiary may have at any time
against the beneficiary, or any transferee, of any Letter of
Credit, or the Issuing Bank, any Lender, or any other Person;
(iii) any draft, certificate, or other document presented
under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;
(iv) any lack of validity, effectiveness, or sufficiency of
any instrument transferring or assigning or purporting to transfer
or assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part;
(v) any loss or delay in the transmission or otherwise of
any document required in order to make a drawing under any Letter
of Credit or of the proceeds thereof;
(vi) any exchange, release or non-perfection of any
collateral, or any release or non-perfection of any collateral, or
any release or amendment or waiver of or consent to departure from
any guarantee, for all or any of the obligations of the Borrower
or an LC Subsidiary in respect of the Letters of Credit;
(vii) any change in the time, manner or place of payment of,
or in any other terms of, all or any of the obligations of the
Borrower or any LC Subsidiary in respect of the Letters of Credit
or any other amendment or waiver of or any consent to departure
from all or any of this Agreement;
(viii) any failure of the beneficiary of a Letter of
Credit to strictly comply with the conditions required in order to
draw upon any Letter of Credit;
(ix) any misapplication by the beneficiary of any Letter of
Credit of the proceeds of any drawing under such Letter of Credit;
or
(x) any other circumstance or happening whatsoever,
whether or not similar to the foregoing;
provided, that, notwithstanding the foregoing, the Issuing Bank shall not be
relieved of any liability it may otherwise have as a result of its gross
negligence or willful misconduct.
SECTION 3.07Increased Costs. (a) Change in Law. If, at any time
after the date of this Agreement, any change in any law or regulation or in
the interpretation thereof by any court or administrative or governmental
authority charged with the administration thereof shall either (i) impose,
modify or deem applicable any reserve, special deposit or similar requirement
against letters of credit or guarantees issued by, or assets held by or
deposits in or for the account of, the Issuing Bank or any LC Lender or (ii)
impose on the Issuing Bank or any LC Lender any other condition regarding this
Agreement or the Letters of Credit or any collateral thereon, and the result
of any event referred to in clause (i) or (ii) above shall be to increase the
cost to the Issuing Bank or such LC Lender of issuing or maintaining, funding
or purchasing participations in the Letters of Credit, then, upon demand by
the Issuing Bank or such LC Lender (with a copy of such demand to the Agent),
the Borrower shall pay to the Agent for the account of the Issuing Bank or
such LC Lender, from time to time as specified by the Issuing Bank or such
LC Lender, additional amounts sufficient to compensate the Issuing Bank or
such LC Lender for such increased cost; provided, that, the Borrower shall
have no obligation to reimburse the Issuing Bank or any LC Lender for
increased costs incurred more than 60 days prior to the date of such demand.
A certificate as to the amount of such increased cost setting forth the basis
for the calculation of such increased costs, submitted by the Issuing Bank or
an LC Lender to the Borrower, shall be conclusive and binding for all
purposes, absent manifest error.
(b) Capital. If, at any time after the date of this Agreement,
the Issuing Bank or LC Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or
would affect the amount of capital required or expected to be maintained by
the Issuing Bank or such LC Lender or any corporation controlling Issuing Bank
or such LC Lender and that the amount of such capital is increased by or based
upon the existence of the Issuing Bank's or LC Lender's commitment hereunder
and other commitments of this type or the issuance of (or commitment to
purchase of participations in) the Letters of Credit (or similar contingent
obligations), then, upon demand by the Issuing Bank or such LC Lender (with a
copy of such demand to the Agent), the Borrower shall pay to the Agent for the
account of the Issuing Bank or such LC Lender, from time to time as specified
by the Issuing Bank or such LC Lender, additional amounts sufficient to
compensate the Issuing Bank or such LC Lender or such corporation in the light
of such circumstances, to the extent that the Issuing Bank or such LC Lender
reasonably determines such increase in capital to be allocable to the
existence of the Issuing Bank's or such LC Lender's commitment hereunder;
provided, that, the Borrower shall have no obligation to pay such compensatory
amounts that relate to an actual increase in the capital of the Issuing Bank
or such LC Lender undertaken by the Issuing Bank or such LC Lender more than
60 days prior to the date of such demand. A certificate as to such amounts
setting forth the basis for the calculation of such amount submitted to the
Borrower and the Agent by the Issuing Bank or an LC Lender shall be conclusive
and binding for all purposes, absent manifest error.
(c) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 3.07 shall survive the payment in full (after the
LC Termination Date) of all Obligations.
(d) Without affecting its rights under Sections 3.07(a) or
3.07(b) or any other provision of this Agreement, the Issuing Bank and each
LC Lender agrees that if there is any increase in any cost to or reduction in
any amount receivable by such Issuing Bank or LC Lender with respect to which
the Borrower would be obligated to compensate such LC Lender pursuant to
Sections 3.07(a) or 3.07(b), such Issuing Bank or LC Lender shall use
reasonable efforts to select an alternative issuing office or Applicable
Lending Office, as the case may be, which would not result in any such
increase in any cost to or reduction in any amount receivable by the Issuing
Bank or such LC Lender; provided, however, that the Issuing Bank and each
LC Lender shall not be obligated to select an alternative issuing office or
Applicable Lending Office if the Issuing Bank or such LC Lender determines
that (i) as a result of such selection the Issuing Bank or such LC Lender
would be in violation of any applicable law, regulation, treaty, or guideline,
or would incur additional costs or expenses or (ii) such selection would be
inadvisable for regulatory reasons or inconsistent with the interests of the
Issuing Bank or such LC Lender.
SECTION 3.08Uniform Customs and Practice. The Uniform Customs and
Practice for Documentary Credits as most recently published by the
International Chamber of Commerce ("UCP") shall in all respects be deemed a
part of this Article III as if incorporated herein and shall apply to the
Letters of Credit.
SECTION 3.09Reductions and Increases in LC Commitments. (a) The
Borrower shall have the right, upon at least three Business Days' notice to
the Issuing Bank and the Agent, to irrevocably terminate in whole or reduce in
part the Issuing Bank's commitment to issue Letters of Credit as specified in
Section 3.01 (which reduction shall without further act reduce in whole or
ratably in part the respective LC Commitments of the LC Lenders), provided,
that, each partial reduction shall be in the aggregate amount of $25,000,000
or an integral multiple of $1,000,000 in excess thereof and no such reduction
shall reduce the LC Commitments below the then outstanding amount of Letter of
Credit Liability.
(b) Not more frequently than once in any period of twelve
consecutive calendar months occurring after the date hereof, the Borrower
shall have the right prior to the LC Termination Date to increase the amount
of the Issuing Bank's commitment to issue Letters of Credit and the amount of
the LC Commitments of one or more LC Lenders (each such increase being an "LC
Commitment Increase"), provided that the Issuing Bank and such LC Lenders
shall have consented to such LC Commitment Increase (which consent may be
granted or withheld by the Issuing Bank and any LC Lender in its sole and
absolute discretion), on and subject to the following terms:
(i) The aggregate amount of all LC Commitment Increases
and A Commitment Increases shall not exceed $200,000,000 after the date
hereof;
(ii) The aggregate amount of each LC Commitment Increase
shall be in a minimum amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof;
(iii) Each LC Commitment Increase shall increase the amount
of the Issuing Bank's commitment to issue Letters of Credit and the
aggregate amount of the LC Commitments by the same amount;
(iv) No proposed LC Commitment Increase shall occur unless
each of the following requirements in respect thereof shall have been
satisfied:
(A) The Agent shall have received from the Borrower
an irrevocable written notice (an "LC Commitment Increase
Notice"), dated not earlier than 60 days before the proposed LC
Commitment Increase Effective Date (as defined below) therefor and
not later than 30 days before such proposed LC Commitment Increase
Effective Date, that (1) specifies (x) the aggregate amount of the
proposed LC Commitment Increase, (y) the LC Lenders whose LC
Commitments are to be increased by the proposed LC Commitment
Increase and the amount by which each such LC Lender's LC
Commitment is to be so increased and (z) the date (the "LC
Commitment Increase Effective Date") on which the proposed LC
Commitment Increase shall become effective, and (2) has been
signed by the Issuing Bank and each LC Lender whose LC Commitment
is to be increased, evidencing the consent of the Issuing Bank and
such LC Lender to the proposed LC Commitment Increase;
(B) On and as of the LC Commitment Increase
Effective Date of the proposed LC Commitment Increase (1) the
following statements shall be true (and the giving of the
applicable LC Commitment Increase Notice shall constitute a
representation and warranty by the Borrower that on such LC
Commitment Increase Effective Date such statements are true):
(x) The representations and warranties
contained in Section 6.01 are correct on and as of
such LC Commitment Increase Effective Date before and
after giving effect to the proposed LC Commitment
Increase, as though made on and as of such date, and
(y) No event has occurred and is continuing,
or would result from such LC Commitment Increase,
which constitutes an Event of Default or Default; and
(2) the Agent shall have received such other approvals, opinions
or documents as the Agent may reasonably request;
(v) Promptly following its receipt of an LC Commitment
Increase Notice in proper form, the Agent shall deliver copies thereof
to the Issuing Bank and each Lender. If, and only if, all of the terms,
conditions and requirements specified in paragraphs (i) through (iv) are
satisfied in respect of any proposed LC Commitment on and as of the
proposed LC Commitment Increase Effective Date thereof, then, as of such
LC Commitment Increase Effective Date and from and after such date, (1)
the amount of the Issuing Bank's commitment to issue Letters of Credit
shall be increased by the amount of the proposed LC Commitment Increase
and the LC Commitments of the LC Lenders consenting to such LC
Commitment Increase shall be increased by the respective amounts
specified in the LC Commitment Increase Notice pertaining thereto and
(2) references herein to the amount of the Issuing Bank's commitment to
issue Letters of Credit and to the amounts of the LC Lenders' respective
LC Commitments shall refer to respective amounts giving effect to such
LC Commitment Increase; and
(vi) It is understood that neither the Issuing Bank nor any
LC Lender shall have any obligation whatsoever to agree to any request
made by the Borrower for an LC Commitment Increase.
SECTION 3.10 Existing Letters of Credit. The Issuing Bank
currently has outstanding documentary and trade letters of credit opened for
the account of the Borrower and certain of the LC Subsidiaries (the "Existing
Letters of Credit") the outstanding balance of which is set forth on Schedule
IV. From and after the date hereof and upon fulfillment of the conditions to
initial Issuance specified in Section 5.01 hereof, each such Existing Letter
of Credit shall be deemed and treated for all purposes hereof (including,
without limitation, the calculation of fees payable under Section 3.05, and
calculating the usage of the Issuing Bank's commitment under Section 3.01) as
a "Letter of Credit" hereunder, any participation interest existing prior to
the date hereof of any LC Lender in such Existing Letters of Credit shall,
without further action on its part, be deemed extinguished in full and each
LC Lender, without further act on its part, shall be deemed to have purchased
a participation in each such Existing Letter of Credit as provided in
Section 3.04 hereof in accordance with its LC Commitment Percentage.
SECTION 3.11Extension of LC Termination Date. At least 30 but not
more than 45 days prior to the LC Termination Date, the Borrower, by written
notice to the Agent, may request that the LC Termination Date be extended for
a period of 364 days from its then current scheduled expiration. The Agent
shall promptly notify the Issuing Bank and each LC Lender of such request, and
the Issuing Bank and each LC Lender shall in turn, within 20 days prior to
such LC Termination Date, notify the Borrower and the Agent in writing
regarding whether the Issuing Bank or such LC Lender (as the case may be) will
consent to such extension. If, and only if, (i) the Majority LC Lenders and
the Issuing Bank consent in writing to such extension prior to the tenth day
preceding such LC Termination Date and (ii) the Majority A Lenders consent to
an extension of the Revolving Termination Date pursuant to Section 2.14, the
LC Termination Date shall be so extended for such 364-day period and
references herein to the "LC Termination Date" shall refer to such
"LC Termination Date" as so extended. If the Issuing Bank or any LC Lender
shall fail to deliver such notice to the Borrower and the Agent as provided
above, the Issuing Bank or such LC Lender shall be deemed not to have
consented to such requested extension and such Issuing Bank's and such LC
Lenders' LC Commitments shall terminate on the scheduled LC Termination Date
(each such non-extending LC Lender being a "Non-Extending LC Lender");
provided, that the obligations of any Non-Extending LC Lender under Section
3.04(e) shall remain in effect as provided therein as to Letters of Credit
Issued on or before the LC Termination Date in effect prior to such extension.
It is understood that neither the Issuing Bank nor any LC Lender shall have
any obligation whatsoever to agree to any request made by the Borrower for an
extension of the LC Termination Date.
SECTION 3.12Currency Provisions. (a) Equivalents.
For purposes of the provisions of this Article III, (i) the equivalent in
Dollars of any Alternative Currency shall be determined by using the mean of
the bid and offer quoted spot rates at which the Issuing Bank's principal
office in New York, New York offers to exchange Dollars for such Alternative
Currency in New York, New York at 11:00 A.M. (New York City time) on the
Business Day on which such equivalent is to be determined and (ii) the
equivalent in any Alternative Currency of Dollars shall be determined by using
the mean of the bid and offer quoted spot rates at which the Issuing Bank's
principal office in New York, New York offers to exchange such Alternative
Currency for Dollars in New York, New York at 11:00 A.M. (New York City time)
on the Business Day on which such equivalent is to be determined.
(b) Issuing Bank's Commitment/LC Commitments. For purposes of
determining the unused portion of the Issuing Bank's commitment specified in
Section 3.01 and of each LC Lender's Commitment, the equivalent in Dollars of
each Letter of Credit issued by the Issuing Bank in an Alternative Currency as
determined on the date of the Issuance of such Letter of Credit shall be the
amount of the Issuing Bank's commitment used in connection with the Issuance
of such Letter of Credit and the resulting proportionate amount of each
LC Lender's LC Commitment used, such reduction to be calculated in accordance
with its LC Commitment Percentage. Further adjustments shall be made with
respect to the unused portion of the Issuing Bank's commitment to Issue
Letters of Credit and each such LC Lender's LC Commitment based upon
fluctuations thereafter in the value of the Alternative Currency of such
Letter of Credit as provided in subsection (c) below.
(c) Mark to Market. If, on any day, the equivalent in Dollars
of the aggregate face amount of all Letters of Credit then outstanding (less
the aggregate amount of cash collateral held by the Issuing Bank with respect
to outstanding Letters of Credit) exceeds the total of the LC Commitments, the
Borrower shall, upon demand by the Agent, immediately pay to the Issuing Bank,
in Dollars, (i) the Dollar amount of such excess plus (ii) a Dollar amount
equal to the lesser of (A) $1,000,000 and (B) 10% of the Dollar equivalent of
all then existing Letter of Credit Liability relating to Letters of Credit
denominated in Alternative Currencies, which amount shall be held by the
Issuing Bank as cash collateral for its obligations with respect to
outstanding Letters of Credit. Concurrently with such payment, the Borrower
shall enter into a cash collateral agreement with the Issuing Bank in form and
substance satisfactory to the Issuing Bank. Amounts on deposit with the
Issuing Bank as cash collateral shall be invested in Cash Equivalents as
directed by the Borrower and shall (so long as no Default has occurred and is
continuing) be released (1) if the LC Termination Date has not occurred, on
the date on which the aggregate of all Letter of Credit Liability does not
exceed 99% of the aggregate amount of the LC Commitments then in effect
(without regard to any usage thereof) or (2) if the LC Termination Date has
occurred, on the first day after the LC Termination Date on which no Letters
of Credit are outstanding.
(d) Monthly Report. The Issuing Bank, on the last Business Day
of each month until the LC Termination Date, shall calculate the Letter of
Credit Liability on such date (converting any amounts of the Letter of Credit
Liability which are denominated in an Alternative Currency to Dollars for
purposes of such calculation), and shall promptly send notice of (i) such
Letter of Credit Liability and (ii) the Dollar amount of any excess of Letter
Credit Liability over total LC Commitments to the Borrower and to each
LC Lender, and the Borrower shall promptly upon receipt thereof make the
payments provided for in subsection (c) above if applicable.
SECTION 3.13Subsidiary Guaranty. (a) Generally. The Issuing Bank
may, from time to time, Issue Letters of Credit for the account of each
LC Subsidiary provided, that, the reimbursement and other obligations of each
such LC Subsidiary are and remain unconditionally guaranteed by the Borrower
pursuant to this Section 3.13.
(b) Guaranty. The Borrower hereby unconditionally guarantees
the punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all obligations of the LC Subsidiaries now or hereafter existing
under this Agreement with respect to Letters of Credit issued for the account
of any of the LC Subsidiaries, including any extensions, modifications,
substitutions, amendments and renewals thereof, whether for reimbursement
obligations, interest, fees, expenses or otherwise (such obligations being the
"Subsidiary Obligations"), and agrees to pay any and all expenses (including
counsel fees and expenses) incurred by the Issuing Bank or the LC Lenders in
enforcing any rights hereunder with respect to the Subsidiary Obligations.
Without limiting the generality of the foregoing, the Borrower's liability
shall extend to all amounts which constitute part of the Subsidiary
Obligations and would be owed by any LC Subsidiary to the Issuing Bank or the
LC Lenders hereunder, or under the Letters of Credit issued for the account of
an LC Subsidiary, but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such LC Subsidiary.
(c) Guaranty Absolute. The Borrower guarantees that the
Subsidiary Obligations will be paid strictly in accordance with the terms
hereof regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of the Issuing
Bank or the LC Lenders with respect thereto. The obligations of the Borrower
hereunder are independent of the Subsidiary Obligations and a separate action
or actions may be brought and prosecuted against the Borrower to enforce the
guaranty contained in this Section 3.13, irrespective of whether any action is
brought against any LC Subsidiary or whether any LC Subsidiary is joined in
any such action or actions. The liability of the Borrower under the guaranty
contained in this Section 3.13 shall be absolute and unconditional
irrespective of:
(i) any lack of validity or enforceability of any of the
Subsidiary Obligations or any agreement or instrument relating
thereto;
(ii) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Subsidiary
Obligations, or any other amendment or waiver of or any consent to
departure herefrom with respect to Letters of Credit issued for
the account of an LC Subsidiary including, without limitation, any
increase in the Subsidiary Obligations resulting from the Issuance
of Letters of Credit beyond the aggregate limitation specified in
Section 3.01 to any and all LC Subsidiaries or otherwise;
(iii) any taking, exchange, release or non-perfection
of any collateral, or any taking, release or amendment or waiver
of or consent to departure from any other guaranty, for all or any
of the Subsidiary Obligations;
(iv) any manner of application of collateral, or
proceeds thereof, to all or any of the Subsidiary Obligations, or
any manner of sale or other disposition of any collateral for all
or any of the Subsidiary Obligations or any other assets of an
LC Subsidiary;
(v) any change, restructuring or termination of the
corporate structure or existence of an LC Subsidiary or any LC
Subsidiary's lack of corporate power or authority; or
(vi) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, a third
party guarantor.
The guaranty provided in this Section 3.13 shall continue to be effective or
be reinstated, as the case may be, if at any time any payment of any of the
Subsidiary Obligations is rescinded or must otherwise be returned by the
Issuing Bank or any LC Lender upon the insolvency, bankruptcy or
reorganization of an LC Subsidiary or otherwise, all as though such payment
had not been made.
(d) Waivers. The Borrower hereby waives, to the extent
permitted by applicable law:
(i) any requirement that the Issuing Bank or any LC Lender
secure or insure any security interest or lien or any property
subject thereto or exhaust any right or take any action against
any LC Subsidiary or any other Person or any collateral;
(ii) any defense arising by reason of any claim or defense
based upon an election of remedies by the Issuing Bank or any
LC Lender (including, without limitation, an election to
nonjudicially foreclose on any real or personal property
collateral) which in any manner impairs, reduces, releases or
otherwise adversely affects its subrogation, reimbursement or
contribution rights or other rights to proceed against any
LC Subsidiary or any other Person or any collateral;
(iii) any defense arising by reason of the failure of any
LC Subsidiary to properly execute any letter of credit application
and agreement or otherwise comply with applicable legal
formalities;
(iv) any defense or benefits that may be derived from
California Civil Code Secs. 2808, 2809, 2810, 2819, 2845 or 2850, or
California Code of Civil Procedure Secs. 580a, 580d or 726, or
comparable provisions of the laws of any other jurisdiction and
all other suretyship defenses it would otherwise have under the
laws of California or any other jurisdiction;
(v) any duty on the part of the Issuing Bank or any
LC Lender to disclose to the Borrower any matter, fact or thing
relating to the business, operation or condition of any
LC Subsidiary and its respective assets now known or hereafter
known by the Issuing Bank or any LC Lender;
(vi) all benefits of any statute of limitations affecting
the Borrower's liability under or the enforcement of the guaranty
provided in this Section 3.13 or any of the Subsidiary Obligations
or any collateral;
(vii) all setoffs and counterclaims;
(viii) promptness, diligence, presentment, demand for
performance and protest;
(ix) notice of nonperformance, default, acceleration,
protest or dishonor;
(x) except for any notice otherwise required by applicable
laws that may not be effectively waived by the Borrower, notice of
sale or other disposition of any collateral; and
(xi) notice of acceptance of the guaranty provided in this
Section 3.13 and of the existence, creation or incurring of new or
additional Subsidiary Obligations.
SECTION 3.14Dollar Payment Obligation. Notwithstanding any other
term or provision hereof to the contrary, if the Borrower or any LC Subsidiary
fails to reimburse the Issuing Bank for any payment made by the Issuing Bank
under a Letter of Credit denominated in an Alternative Currency by the close
of business on the Business Day when due at the Payment Office specified for
such reimbursement payment, then the payment made by such Issuing Bank in such
Alternative Currency shall be converted into Dollars (the "Dollar Payment
Amount") by the Issuing Bank as provided for herein, and each of the Borrower
and each LC Subsidiary for whose account such Letter of Credit was Issued
agrees that it shall be unconditionally obligated to, and shall immediately,
reimburse the Issuing Bank the Dollar Payment Amount at the Issuing Bank's
then Payment Office for Dollars.
SECTION 3.15Applications. This Agreement shall control over any
provision of any application and agreement for Letters of Credit to the
contrary, but additive or supplemental provisions of any such application and
agreement shall apply to each Letter of Credit Issued pursuant to such
application and agreement.
SECTION 3.16LC Subsidiaries. Any Subsidiary of the Borrower not
an LC Subsidiary on the date hereof may become an "LC Subsidiary" hereunder by
delivering to the Issuing Bank (which shall promptly forward a copy thereof
to each LC Lender and the Agent) an agreement, in form and substance
satisfactory to the Issuing Bank, wherein such Subsidiary agrees to be bound
by all terms and provisions of this Agreement relating to Letters of Credit to
be issued for the account of such Subsidiary and delivers a written consent of
the Borrower assenting to the inclusion of such Subsidiary as an
"LC Subsidiary" hereunder. Unless objected to by the Majority LC Lenders
within the 10 day period referred to below, such Subsidiary shall become an
"LC Subsidiary" hereunder 10 days after the Issuing Bank notifies the Borrower
that such agreement and consent are in form and substance satisfactory to it;
provided, that, no Subsidiary shall become an "LC Subsidiary" until the
Issuing Bank shall have notified the Borrower in writing that such agreement
and consent are in form and substance satisfactory to the Issuing Bank.
ARTICLE IVPAYMENTS, TAXES, EXTENSIONS, ETC.
SECTION 4.01Payments and Computations/Borrowings. (a) The
Borrower shall make each payment hereunder with respect to Article II, the
A Advances, the A Lenders, the B Advances and the Agent free and clear of all
claims, charges, offsets or deductions whatsoever not later than 12:00 noon
(New York City time) on the day when due in U.S. dollars to the Agent (unless
otherwise specified in Section 2.03 with respect to the B Advances) at its
address referred to in Section 10.02 in same day funds. The Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal or interest or facility or commitment fees ratably (other than
amounts payable pursuant to Section 2.03, 2.05(b), 2.08, 2.12, 2.14 or 4.02)
to the A Lenders for the account of their respective Applicable Lending
Offices, and like funds relating to the payment of any other amount payable to
such A Lender to be distributed to the appropriate A Lender or A Lenders and
applied in accordance with the terms of this Agreement. Upon its acceptance
of an Assignment and Acceptance and recording of the information contained
therein in the Register pursuant to Section 10.07(d), from and after the
effective date specified in such Assignment and Acceptance, the Agent shall
make all payments hereunder in respect of the interest assigned thereby to the
A Lender assignee thereunder, and the parties to such Assignment and
Acceptance shall make all appropriate adjustments in such payments for periods
prior to such effective date directly between themselves.
(b) The Borrower and each LC Subsidiary hereby authorize the
Agent and each A Lender if and to the extent payment owed to the Agent or such
A Lender is not paid when due hereunder to charge from time to time against
any or all of the Borrower's or such LC Subsidiary's accounts with the Agent
or such A Lender any amount so due.
(c) All computations of interest based on the Base Rate and of
facility fees shall be made by the Agent on the basis of a year of 365 or 366
days, as the case may be, and all computations of interest relating to
commitment fees, fixed rates of interest on B Advances or based on the
Eurodollar Rate or the Federal Funds Rate shall be made by the Agent, and all
computations of interest pursuant to Section 2.08 shall be made by an
A Lender, on the basis of a year of 360 days, in each case for the actual
number of days (including the first day but excluding the last day) occurring
in the period for which such interest or commitment fees are payable. Each
determination by the Agent (or, in the case of Section 2.08, by an A Lender)
of an interest rate hereunder shall be conclusive and binding for all
purposes, absent manifest error.
(d) Whenever any payment hereunder shall be stated to be due on
a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility or commitment
fee, as the case may be; provided, however, if such extension would cause
payment of interest on or principal of Eurodollar Rate Advances to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day.
(e) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the A Lender or
A Lenders hereunder that the Borrower will not make such payment in full, the
Agent may assume that the Borrower has made such payment in full to the Agent
on such date and the Agent may, in reliance upon such assumption, cause to be
distributed to such A Lender or A Lenders on such due date an amount equal to
the amount then due such A Lender or A Lenders. If and to the extent that the
Borrower shall not have so made such payment in full to the Agent, each such
A Lender shall repay to the Agent forthwith on demand such amount distributed
to such A Lender together with interest thereon, for each day from the date
such amount is distributed to such A Lender until the date such A Lender
repays such amount to the Agent, at the Federal Funds Rate.
SECTION 4.02Taxes/Borrowings. (a) Any and all payments by the
Borrower hereunder shall be made free and clear of and without deduction for
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each A Lender and the Agent, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such A Lender
or the Agent (as the case may be) is organized or any political subdivision
thereof and, in the case of each A Lender, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction of such A Lender's
Applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any A Lender or the Agent, (i) the sum payable shall be increased
as may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 4.02) such
A Lender or the Agent (as the case may be) receives an amount equal to the sum
it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement (hereinafter referred to as "Other Taxes").
(c) The Borrower will reimburse each A Lender and the Agent for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 4.02) paid by such A Lender or the Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or
with respect thereto, whether or not such Taxes or Other Taxes were correctly
or legally asserted. This reimbursement shall be made within 30 days from the
date such A Lender or the Agent (as the case may be) makes written demand
therefor. The Agent and each A Lender, as the case may be, shall give prompt
(within 10 Business Days) notice to the Borrower of the payment by the Agent
or such A Lender, as the case may be, of such Taxes or Other Taxes, and of the
assertion by any governmental or taxing authority that such Taxes or Other
Taxes are due and payable, but the failure to give such notice shall not
affect the Borrower's obligations hereunder to reimburse the Agent and each
A Lender for such Taxes or Other Taxes, except that the Borrower shall not be
liable for penalties or interest accrued or incurred after such 10 Business
Day period until such time as it receives the notice contemplated above, after
which time it shall be liable for interest and penalties accrued or incurred
prior to or during such 10 Business Day period and accrued or incurred after
such receipt. The Borrower shall not be liable for any penalties, interest,
expense or other liability with respect to such Taxes or Other Taxes after it
has reimbursed the amount thereof to the Agent or the appropriate A Lender, as
the case may be.
(d) Each A Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and
delivery of this Agreement in the case of each Bank and on the date of the
Assignment and Acceptance pursuant to which it becomes an A Lender in the case
of each other A Lender, and from time to time thereafter if requested in
writing by the Borrower (but only so long as such A Lender remains lawfully
able to do so), shall provide the Borrower with Internal Revenue Service form
1001 or 4224, as appropriate, or any successor form prescribed by the Internal
Revenue Service, certifying that such A Lender is entitled to benefits under
an income tax treaty to which the United States is a party which reduces the
rate of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. If the form provided by
an A Lender at the time such A Lender first becomes a party to this Agreement
indicates a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from "Taxes" as
defined in Section 4.02(a).
(e) For any period with respect to which an A Lender has failed
to provide the Borrower with the appropriate form described in Section 4.02(d)
(other than if such failure is due to a change in law occurring subsequent to
the date on which a form originally was required to be provided, or if such
form otherwise is not required under the first sentence of subsection (d)
above), such A Lender shall not be entitled to indemnification under
Section 4.02(a) with respect to Taxes imposed by the United States; provided,
however, that should an A Lender become subject to Taxes because of its
failure to deliver a form required hereunder, the Borrower shall take such
steps as the A Lender shall reasonably request to assist the A Lender to
recover such Taxes.
(f) Notwithstanding any contrary provisions of this Agreement,
in the event that an A Lender that originally provided such form as may be
required under Section 4.02(d) thereafter ceases to qualify for complete
exemption from United States withholding tax, such A Lender may assign its
interest under this Agreement to any assignee and such assignee shall be
entitled to the same benefits under this Section 4.02 as the assignor
provided, that, the rate of United States withholding tax applicable to such
assignee shall not exceed the rate then applicable to the assignor.
(g) Without affecting its rights under this Section 4.02 or any
provision of this Agreement, each A Lender agrees that if any Taxes or Other
Taxes are imposed and required by law to be paid or to be withheld from any
amount payable to any A Lender or its Applicable Lending Office with respect
to which the Borrower would be obligated pursuant to this Section 4.02 to
increase any amounts payable to such A Lender or to pay any such Taxes or
Other Taxes, such A Lender shall use reasonable efforts to select an
alternative Applicable Lending Office which would not result in the imposition
of such Taxes or Other Taxes; provided, however, that no A Lender shall be
obligated to select an alternative Applicable Lending Office if such A Lender
determines that (i) as a result of such selection such A Lender would be in
violation of an applicable law, regulation, or treaty, or would incur
additional costs or expenses or (ii) such selection would be inadvisable for
regulatory reasons or inconsistent with the interests of such A Lender.
(h) Each A Lender agrees with the Borrower that it will take all
reasonable actions by all usual means (i) to secure and maintain all benefits
available to it under the provisions of any applicable double tax treaty
concluded by the United States of America to which it may be entitled by
reason of the location of such A Lender's Applicable Lending Office or place
of incorporation or its status as an enterprise of any jurisdiction having any
such applicable double tax treaty, if such benefit would reduce the amount
payable by the Borrower in accordance with this Section 4.02 and
(ii) otherwise to cooperate with the Borrower to minimize the amount payable
by the Borrower pursuant to this Section 4.02; provided, however, that no
A Lender shall be obliged to disclose to the Borrower any information
regarding its tax affairs or tax computations nor to reorder its tax affairs
or tax planning pursuant hereto.
(i) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 4.02 shall survive the payment in full of the
Obligations.
SECTION 4.03Sharing of Payments, Etc./Borrowings. If any A Lender
shall obtain any payment (whether voluntary, involuntary, through the exercise
of any right of set-off, or otherwise) on account of the A Advances made by it
(other than pursuant to Section 2.05(b), 2.08, 2.12, 2.14 or 4.02) in excess
of its ratable share of payments on account of the A Advances obtained by all
the A Lenders, such A Lender shall forthwith purchase from the other A Lenders
such participations in the A Advances made by them as shall be necessary to
cause such purchasing A Lender to share the excess payment ratably with each
of them, provided, however, that if all or any portion of such excess payment
is thereafter recovered from such purchasing A Lender, such purchase from each
A Lender shall be rescinded and such A Lender shall repay to the purchasing
A Lender the purchase price to the extent of such recovery together with an
amount equal to such A Lender's ratable share (according to the proportion of
(i) the amount of such A Lender's required repayment to (ii) the total amount
so recovered from the purchasing A Lender) of any interest or other amount
paid or payable by the purchasing A Lender in respect of the total amount so
recovered. The Borrower agrees that any A Lender so purchasing a
participation from another Lender pursuant to this Section 4.03 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
A Lender were the direct creditor of the Borrower in the amount of such
participation.
SECTION 4.04Evidence of Debt/Borrowings. (a) Each A Lender shall
maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such A Lender resulting from
each Advance owing to such A Lender from time to time, including the amounts
of principal and interest payable and paid to such A Lender from time to time
hereunder.
(b) The Register maintained by the Agent pursuant to Section
10.07(c) shall include a control account, and a subsidiary account for each
A Lender, in which accounts (taken together) shall be recorded (i) the date
and amount of each A Borrowing made hereunder, the Type of Advances comprising
such A Borrowing and the Interest Period applicable thereto, (ii) the terms of
each Assignment and Acceptance delivered to and accepted by it, (iii) the
amount of any principal or interest due and payable or to become due and
payable from the Borrower to each A Lender hereunder, and (iv) the amount of
any sum received by the Agent from the Borrower hereunder and each A Lender's
share thereof.
(c) The entries made in the Register shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 4.05Payments and Computations/Letters of Credit. (a) The
Borrower and each LC Subsidiary, as the case may be, shall make each payment
with respect to the Letters of Credit, the Issuing Bank or the LC Lenders to
be made by it free and clear of all claims, charges, offsets or deductions
whatsoever not later than (i) if such payment relates to facility or
commitment fees or amounts (other than reimbursements for payments in an
Alternative Currency made under Letters of Credit) or if such payment relates
to a Letter of Credit denominated in Dollars, 12:00 noon (New York City time)
on the day when due in Dollars to the Issuing Bank at its address referred to
in Section 10.02 in same day funds and (ii) if such payment relates to
reimbursement of a Letter of Credit denominated in an Alternative Currency,
(A) in such Alternative Currency, at the Issuing Bank's Payment Office
therefor so long as such payment is made by the close of business on the
Business Day when due and (B) thereafter in Dollars (at the then Dollar
equivalent of the amount due on such preceding Business Day), by 12:00 noon
(New York City time) to the Issuing Bank at its address referred to in Section
10.02 in same day funds as provided in Section 3.14 above. The Issuing Bank
will promptly thereafter (if amounts are owed to the LC Lenders by the terms
hereof) cause to be distributed like funds relating to the payment of
reimbursement obligations or facility or commitment fees ratably (other than
amounts payable pursuant to Section 3.03(a), 3.07, or 4.06) to the LC Lenders
for the account of their respective Applicable Lending Offices, and like
funds relating to the payment of any other amount payable to the Issuing Bank
or to such LC Lender to be distributed to the appropriate LC Lender or
LC Lenders and applied in accordance with the terms of this Agreement. Upon
the Agent's acceptance of an Assignment and Acceptance and recording of the
information contained therein in the Register pursuant to Section 10.07(d),
from and after the effective date specified in such Assignment and Acceptance,
the Issuing Bank shall make all payments hereunder in respect of the interest
assigned thereby to the LC Lender assignee thereunder, and the parties to such
Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between themselves.
(b) The Borrower and each LC Subsidiary hereby authorize each
LC Lender and the Issuing Bank, if and to the extent payment owed to such
LC Lender or the Issuing Bank (including the immediate repayments of
participations purchased and funded by an LC Lender pursuant to Section 3.04)
is not paid when due hereunder to charge from time to time against any or all
of the Borrower's or such LC Subsidiary's accounts with such LC Lender or
Issuing Bank any amount so due.
(c) All computations of interest based on the Base Rate and of
facility and commitment fees shall be made by the Issuing Bank on the basis of
a year of 365 or 366 days, as the case may be, and all computations of
interest based on the Federal Funds Rate shall be made by the Issuing Bank on
the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period
for which such interest, facility or commitment fees are payable. Each
determination by the Issuing Bank of an interest rate hereunder shall be
conclusive and binding for all purposes, absent manifest error.
(d) Whenever any payment hereunder shall be stated to be due on
a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or facility or commitment
fee, as the case may be.
(e) Unless the Issuing Bank shall have received notice from the
Borrower prior to the date on which any payment is due to the Issuing Bank or
LC Lenders hereunder that the Borrower will not make such payment in full, the
Issuing Bank may assume that the Borrower has made such payment in full to the
Issuing Bank on such date and the Issuing Bank may, in reliance upon such
assumption, cause to be distributed to such LC Lender or LC Lenders on such
due date an amount equal to the amount then due such LC Lender or LC Lenders.
If and to the extent that the Borrower shall not have so made such payment in
full to the Issuing Bank, each such LC Lender shall repay to the Issuing Bank
forthwith on demand such amount distributed to such LC Lender together with
interest thereon, for each day from the date such amount is distributed to
such LC Lender until the date such LC Lender repays such amount to the Issuing
Bank, at the Federal Funds Rate.
SECTION 4.06Taxes/Letters of Credit. (a) Any and all payments by
the Borrower and each LC Subsidiary hereunder with respect to the Letters of
Credit shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding, in the case of each
LC Lender and the Issuing Bank, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which such
LC Lender or the Issuing Bank (as the case may be) is organized or any
political subdivision thereof and, in the case of each LC Lender, taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction
of such Lender's Applicable Lending Office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If
the Borrower or any LC Subsidiary shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder to any LC Lender or the
Issuing Bank, (i) the sum payable shall be increased as may be necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 4.06) such LC Lender or the Issuing
Bank (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower or the appropriate LC Subsidiary shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement or the Letters of Credit (hereinafter referred to as "Other Taxes").
(c) The Borrower will reimburse each LC Lender and the Issuing
Bank for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section 4.06) paid by such LC Lender or the Issuing Bank
(as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. This reimbursement shall
be made within 30 days from the date such LC Lender or the Issuing Bank (as
the case may be) makes written demand therefor. The Issuing Bank and each
LC Lender, as the case may be, shall give prompt (within 10 Business Days)
notice to the Borrower of the payment by the Issuing Bank or such LC Lender,
as the case may be, of such Taxes or other Taxes, and of the assertion by any
governmental or taxing authority that such Taxes or other Taxes are due and
payable, but the failure to give such notice shall not affect the Borrower's
obligations hereunder to reimburse the Issuing Bank and each LC Lender for
such Taxes or other Taxes, except that the Borrower shall not be liable for
penalties or interest accrued or incurred after such 10 Business Day period
until such time as it receives the notice contemplated above, after which time
it shall be liable for interest and penalties accrued or incurred prior to or
during such 10 Business Day period and accrued or incurred after such receipt.
The Borrower shall not be liable for any penalties, interest, expense or other
liability with respect to such Taxes or Other Taxes after it has reimbursed
the amount thereof to the Issuing Bank or the appropriate LC Lender.
(d) Each LC Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and
delivery of this Agreement in the case of each Bank and on the date of the
Assignment and Acceptance pursuant to which it becomes an LC Lender in the
case of each other LC Lender, and from time to time thereafter if requested in
writing by the Borrower (but only so long as such LC Lender remains lawfully
able to do so), shall provide the Borrower with Internal Revenue Service Form
1001 or 4224, as appropriate, or any successor form prescribed by the Internal
Revenue Service, certifying that such LC Lender is entitled to benefits under
an income tax treaty to which the United States is a party which reduces the
rate of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. If the form provided by
a LC Lender at the time such LC Lender first becomes a party to this Agreement
indicates a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from "Taxes" as
defined in Section 4.06(a).
(e) For any period with respect to which an LC Lender has failed
to provide the Borrower with the appropriate form described in Section 4.06(d)
(other than if such failure is due to a change in law occurring subsequent to
the date on which a form originally was required to be provided, or if such
form otherwise is not required under the first sentence of subsection (d)
above), such LC Lender shall not be entitled to indemnification under
Section 4.06(a) with respect to Taxes imposed by the United States; provided,
however, that should an LC Lender become subject to Taxes because of its
failure to deliver a form required hereunder, the Borrower shall take such
steps as the LC Lender shall reasonably request to assist the LC Lender to
recover such Taxes.
(f) Notwithstanding any contrary provisions of this Agreement,
in the event that an LC Lender that originally provided such form as may be
required under Section 4.06(d) thereafter ceases to qualify for complete
exemption from United States withholding tax, such LC Lender may assign its
interest under this Agreement to any assignee and such assignee shall be
entitled to the same benefits under this Section 4.06 as the assignor provided
that the rate of United States withholding tax applicable to such assignee
shall not exceed the rate then applicable to the assignor.
(g) Without affecting its rights under this Section 4.06 or any
other provision of this Agreement, the Issuing Bank and each LC Lender agrees
that if any Taxes or Other Taxes are imposed and required by law to be paid or
to be withheld from any amount payable to the Issuing Bank or any LC Lender or
its Applicable Lending Office with respect to which the Borrower would be
obligated pursuant to this Section 4.06 to increase any amounts payable to the
Issuing Bank or such LC Lender or to pay any such Taxes or Other Taxes, the
Issuing Bank or such LC Lender shall use reasonable efforts to select an
alternative issuing office or Applicable Lending Office, as the case may be,
which would not result in the imposition of such Taxes or Other Taxes;
provided, however, that the Issuing Bank and each LC Lender shall not be
obligated to select an alternative issuing office or Applicable Lending
Office, as the case may be, if the Issuing Bank or such LC Lender determines
that (i) as a result of such selection the Issuing Bank or such LC Lender
would be in violation of an applicable law, regulation, or treaty, or would
incur additional costs or expenses or (ii) such selection would be inadvisable
for regulatory reasons or inconsistent with the interests of such LC Lender.
(h) Each LC Lender agrees with the Borrower that it will take
all reasonable actions by all usual means (i) to secure and maintain the
benefit of all benefits available to it under the provisions of any applicable
double tax treaty concluded by the United States of America to which it may be
entitled by reason of the location of such LC Lender's Applicable Lending
Office or place of incorporation or its status as an enterprise of any
jurisdiction having any such applicable double tax treaty, if such benefit
would reduce the amount payable by the Borrower or an LC Subsidiary in
accordance with this Section 4.07 and (ii) otherwise to cooperate with the
Borrower to minimize the amount payable by the Borrower or any LC Subsidiary
pursuant to this Section 4.07; provided, however, that no LC Lender shall be
obliged to disclose to the Borrower or any LC Subsidiary any information
regarding its tax affairs or tax computations nor to reorder its tax affairs
or tax planning pursuant hereto.
(i) Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 4.06 shall survive the payment in full of the
Obligations.
SECTION 4.07Sharing of Payments, Etc./Letters of Credit. If any
LC Lender shall obtain any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) on account of any Letter
of Credit Liability of the Borrower or any LC Subsidiary hereunder (other than
pursuant to Section 3.07 or 4.06) in excess of its LC Commitment Percentage of
any such payments on account of such Letter of Credit Liability obtained by
all the LC Lenders, such LC Lender shall forthwith purchase from the other
LC Lenders such participations in such LC Lender's participations purchased
pursuant to Section 3.04 as shall be necessary to cause such purchasing
LC Lender to share the excess payment ratably with each other LC Lender,
provided, however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing LC Lender such purchase from each
LC Lender shall be rescinded and each such LC Lender shall repay to the
purchasing LC Lender the purchase price to the extent of such recovery
together with an amount equal to each such LC Lender's ratable share
(according to the proportion of (i) the amount of such LC Lender's required
repayment to (ii) the total amount so recovered from the purchasing LC Lender)
of any interest or other amount paid or payable by the purchasing LC Lender in
respect of the total amount so recovered. The Borrower and each LC Subsidiary
agrees that any LC Lender so purchasing a sub-participation from another
LC Lender pursuant to this Section 4.07 may, to the fullest extent permitted
by law, exercise all its rights of payment (including the right of set-off)
with respect to such sub-participation as fully as if such LC Lender were the
direct creditor of the Borrower or each LC Subsidiary in the amount of such
participation.
ARTICLE VCONDITIONS OF LENDING
SECTION 5.01Condition Precedent to Initial Advances/Issuance. The
obligation of each A Lender to make its initial Advance and of the Issuing
Bank to issue the initial Letter of Credit is subject to the condition
precedent that the Issuing Bank shall have received on or before the day of
the initial Borrowing (and initial Issuance) the following, in form and
substance satisfactory to the Agent and in sufficient copies for each Lender:
(a) Certified copies of all documents of the Borrower evidencing
necessary corporate action and governmental approvals, if any, with
respect to this Agreement.
(b) A certificate of the Secretary or an Assistant Secretary of
the Borrower certifying the names and true signatures of the officers of
the Borrower and each LC Subsidiary authorized to sign this Agreement
and the other documents to be delivered hereunder (including, without
limitation, Letter of Credit applications and agreements).
(c) A favorable opinion of Borrower's General Counsel or
Associate General Counsel, substantially in the form of Exhibit C
hereto, and as to such other matters as any Lender through the Agent may
reasonably request.
(d) A favorable opinion of Shearman & Sterling, counsel for the
Agent, substantially in the form of Exhibit D hereto.
(e) Such other approvals, opinions or documents as the Agent may
reasonably request.
SECTION 5.02Conditions Precedent to Each ABorrowing/Issuance. The
obligation of each A Lender to make an A Advance on the occasion of each
A Borrowing (including the initial A Borrowing) and the obligation of the
Issuing Bank to Issue each Letter of Credit (including the initial Letter of
Credit) shall be subject to the further conditions precedent that on the date
of such A Borrowing or Issuance the following statements shall be true (and
each of the giving of the applicable Notice of A Borrowing and the acceptance
by the Borrower of the proceeds of such A Borrowing and the request for
Issuance by the Borrower or an LC Subsidiary shall constitute a representation
and warranty by the Borrower or such LC Subsidiary that on the date of such
A Borrowing or Issuance such statements are true):
(a) The representations and warranties contained in Section 6.01
(other than Section 6.01(e)) are correct on and as of the date of such
A Borrowing or Issuance, before and after giving effect to such
A Borrowing or Issuance, and to the application of the proceeds
therefrom, as though made on and as of such date, and
(b) (i) No event has occurred and is continuing, or would result
from such A Borrowing or from the application of the proceeds therefrom
or Issuance, which constitutes an Event of Default or Default and (ii)
no event has occurred and is continuing which constitutes an "Event of
Default" or "Default" under the Five-Year Credit Agreement.
SECTION 5.03Conditions Precedent to Each BBorrowing. The
obligation of each A Lender which is to make a B Advance on the occasion of a
B Borrowing (including the initial B Borrowing) to make such B Advance as part
of such B Borrowing is subject to the conditions precedent that (i) the Agent
shall have received the written confirmatory Notice of B Borrowing with
respect thereto or the notices from the Borrower contemplated by the second
sentence of Section 2.03(a)(v) and (ii) on the date of such B Borrowing the
following statements shall be true (and each of the giving of the applicable
Notice of B Borrowing and the acceptance by the Borrower of the proceeds of
such B Borrowing shall constitute a representation and warranty by the
Borrower that on the date of such B Borrowing such statements are true):
(a) The representations and warranties contained in Section 6.01
(other than Section 6.01(e)) are correct on and as of the date of such
B Borrowing, before and after giving effect to such B Borrowing and to
the application of the proceeds therefrom, as though made on and as of
such date,
(b) (i) No event has occurred and is continuing, or would result
from such B Borrowing or from the application of the proceeds therefrom,
which constitutes an Event of Default or Default and (ii) no event has
occurred and is continuing which constitutes an "Event of Default" or
"Default" under the Five-Year Credit Agreement, and
(c) No event has occurred and no circumstance exists as a result
of which the information concerning the Borrower that has been provided
to the Agent and each A Lender by the Borrower in connection herewith
would, taken as a whole, include an untrue statement of a material fact
or omit to state any material fact or any fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading.
ARTICLE VIREPRESENTATIONS AND WARRANTIES
SECTION 6.01Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) The Borrower is a corporation duly organized, validly
existing and in good standing under the laws of Delaware; each
LC Subsidiary is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation. The
Borrower and each of its Subsidiaries possess all corporate powers and
all other authorizations and licenses necessary to engage in their
respective businesses, except where the failure to so possess would not
have a Material Adverse Effect.
(b) The execution, delivery and performance by the Borrower and
each LC Subsidiary of this Agreement are within the Borrower's and such
LC Subsidiary's respective corporate powers, have been duly authorized
by all necessary corporate action, and do not contravene (i) the
Borrower's or any LC Subsidiary's charter or by-laws or (ii) law or any
contractual restriction binding on or affecting the Borrower or any
LC Subsidiary or their respective properties.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by the
Borrower or each LC Subsidiary of this Agreement.
(d) This Agreement is the legal, valid and binding obligation of
the Borrower and each LC Subsidiary enforceable against the Borrower and
each LC Subsidiary in accordance with its terms.
(e) The Consolidated balance sheets of the Borrower and its
Subsidiaries as at February 1, 1997, and the related Consolidated
statements of income and retained earnings of the Borrower and its
Subsidiaries for the Fiscal Year then ended, certified by Deloitte &
Touche, copies of which have been furnished to each Lender, fairly
present the Consolidated financial condition of the Borrower and its
Subsidiaries as at such date and the results of the operations of the
Borrower and its Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles consistently
applied, and since February 1, 1997, there has been no material adverse
change in the condition (financial or otherwise), operations, properties
or prospects of the Borrower and its Subsidiaries taken as a whole.
(f) There is no pending or, to the best of Borrower's knowledge,
threatened action or proceeding affecting the Borrower or any of its
Subsidiaries before any court, governmental agency or arbitrator, which
has a reasonable probability (taking into account the exhaustion of all
appeals and the assertion of all defenses) of having a Material Adverse
Effect or which purports to affect the legality, validity or
enforceability of this Agreement.
(g) Following the application of the proceeds of each Advance,
not more than 25 percent of the value of the assets (either of the
Borrower only or of the Borrower and its Subsidiaries on a Consolidated
basis) which are subject to any restriction on Liens set forth in this
Agreement or in any agreement or instrument between the Borrower and any
Lender or any Affiliate of any Lender relating to Debt and within the
scope of Section 8.01(d) will consist of Margin Stock.
(h) Neither the Borrower nor any of its Subsidiaries is an
"investment company," or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended.
(i) Set forth on Schedule VII hereto is a complete and accurate
list, as of the date hereof, of all Plans of the Borrower and its
Subsidiaries. Neither the Borrower nor any ERISA Affiliate is a party
or subject to, or has any obligation to make payments, to, any
Multiemployer Plan.
ARTICLE VIICOVENANTS OF THE BORROWER
SECTION 7.01Affirmative Covenants. The Borrower will, unless the
Majority Combined Lenders shall otherwise consent in writing:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects with all applicable
laws (including, without limitation, all Environmental Liens), rules,
regulations and orders, such compliance to include, without limitation,
paying before the same become delinquent all taxes, assessments and
governmental charges imposed upon it or upon its property except to the
extent contested in good faith or where the failure to comply would not
have a Material Adverse Effect.
(b) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its corporate existence, rights (charter and statutory), and franchises
except if, in the reasonable business judgment of the Borrower or such
Subsidiary, as the case may be, it is in its best economic interest not
to preserve and maintain such rights or franchises and such failure to
preserve and maintain such rights or franchises would not materially
adversely affect the rights of the Lenders or the Issuing Bank hereunder
or the ability of the Borrower to perform its obligations hereunder.
(c) Visitation Rights. Permit the Agent, the Issuing Bank and
any Lender or any agents or representatives thereof from time to time
during normal business hours to examine and make copies of and abstracts
from the records and books of account of, and upon reasonable prior
notice to visit the properties of, the Borrower and its Subsidiaries
during reasonable business hours, without hindrance or delay, and to
discuss the affairs, finances and accounts of the Borrower and its
Subsidiaries with any of their respective directors, officers or agents.
(d) Keeping of Books. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Borrower and each of its Subsidiaries in accordance with
sound business practice.
(e) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its
properties which are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted,
consistent with sound business practice, except where the failure to so
maintain and preserve would not have a Material Adverse Effect.
(f) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance (other than earthquake insurance) in
amounts, from responsible and reputable insurance companies or
associations, with limitations, of types and on terms as is customary
for the industry; provided, that, the Borrower and each of its
Subsidiaries may self-insure risks and liabilities in accordance with
its practice as of the date hereof and may in addition self-insure risks
and liabilities in amounts as are customarily self-insured by similarly
situated Persons in the industry.
(g) Employment of Technology, Disposal of Hazardous Materials,
Etc. (i) Employ, and cause each of its Subsidiaries to employ,
appropriate technology and compliance procedures to maintain compliance
with any applicable Environmental Laws except where the failure to so
employ would not have a Material Adverse Effect, (ii) obtain and
maintain, and cause each of its Subsidiaries to obtain and maintain, any
and all material permits required by applicable Environmental Laws in
connection with its or its Subsidiaries' operations and (iii) dispose
of, and cause each of its Subsidiaries to dispose of, any and all
Hazardous Substances only at facilities and with carriers reasonably
believed to possess valid permits under RCRA, if applicable, and any
applicable state and local Environmental Laws except where the failure
to so dispose would not have a Material Adverse Effect. The Borrower
shall use its best efforts, and cause each of its Subsidiaries to use
its best efforts, to obtain all certificates required by law to be
obtained by the Borrower and its Subsidiaries from all contractors
employed by the Borrower or any of its Subsidiaries in connection with
the transport or disposal of any Hazardous Substances except where
failure to transport or dispose in accordance with any applicable
Environmental Laws would not have a Material Adverse Effect.
(h) Environmental Matters. If the Borrower or any of its
Subsidiaries shall:
(i) receive written notice that any material violation of
any Environmental Laws may have been committed or is about to be
committed by the Borrower or any of its Subsidiaries the cure of
which would result in expenditures exceeding $1,000,000;
(ii) receive written notice that any administrative
or judicial complaint or order has been filed or is about to be
filed against the Borrower or any of its Subsidiaries alleging any
material violation of any Environmental Laws or requiring the
Borrower or any of its Subsidiaries to take any action (which, if
taken, would result in expenditures exceeding $1,000,000) in
connection with the release or threatened release of Hazardous
Substances or solid waste into the environment; or
(iii) receive written notice from a federal, state,
foreign or local governmental agency or private party alleging
that the Borrower or any of its Subsidiaries is liable or
responsible for costs in excess of $1,000,000 associated with the
response to cleanup, stabilization or neutralization of any
Environmental Activity;
then it shall provide the Agent with a copy of such notice within five
Business Days of the Borrower's or such Subsidiary's receipt thereof.
(i) Guaranty. Within ten Business Days after the request of the
Majority Combined Lenders made through the Agent, cause its Subsidiaries
designated in such request to enter into and deliver a guaranty of the
Obligations, such guaranty to be in form and substance satisfactory to
the Majority Combined Lenders.
SECTION 7.02Negative Covenants. The Borrower will not, without
the written consent of the Majority Combined Lenders:
(a) Liens, Etc. Create or suffer to exist, or permit any of its
Subsidiaries to create or suffer to exist, any Lien, other than
Permitted Liens and Liens upon or with respect to Margin Stock.
(b) Debt. Create or suffer to exist, or permit any of its
Subsidiaries to create or suffer to exist, any Debt if, immediately
after giving effect to the incurrence of such Debt and the receipt and
application of any proceeds thereof, the Borrower and its Subsidiaries,
on a Consolidated basis, would be in violation of the financial covenant
specified in Section 7.03 hereof.
(c) Mergers, Etc. Merge or consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions) all or substantially all of its assets
(whether now owned or hereafter acquired) to, any Person, or permit any
of its Subsidiaries to do so, except that any Subsidiary of the Borrower
may merge or consolidate with or into, or dispose of assets to, any
other Subsidiary of the Borrower and except that any Subsidiary of the
Borrower may merge into or dispose of assets to the Borrower and,
subject to Section 7.02(d)(iii), the Borrower may merge or consolidate
with or into, and any Subsidiary of the Borrower may merge or
consolidate with or into, any other Person, provided in each case that,
immediately after giving effect to such proposed transaction, no Event
of Default or Default shall exist, and in the case of any merger or
consolidation to which the Borrower is a party, the Person into which
the Borrower shall be merged or formed by any such consolidation shall
be a corporation organized and existing under the laws of the United
States of America or any State thereof and shall assume the Borrower's
obligations hereunder in an agreement or instrument in form and
substance reasonably satisfactory to the Agent.
(d) Asset Acquisition, Investments, Mergers.
(i) Asset Acquisitions. Purchase, or permit any of its
Subsidiaries to purchase, all or substantially all the assets of
any Person (an "Asset Acquisition") unless (A) if such Asset
Acquisition involves the purchase of Retail Assets, the purchase
price of the Retail Assets to be purchased in such Asset
Acquisition is less than 50% of the book value of the Borrower's
Consolidated Total Assets immediately prior to such Asset
Acquisition or (B) if such Asset Acquisition involves the purchase
of Non-Retail Assets, the purchase price of the Non-Retail Assets
to be purchased in such Asset Acquisition is less than 25% of the
book value of the Borrower's Consolidated Total Assets immediately
prior to such Asset Acquisition and (C) immediately prior to and
after giving effect to such Asset Acquisition no Event of Default
or Default shall exist.
(ii) Investments. Make, or permit any of its Subsidiaries
to make, an investment in any Person by way of the purchase of
such Person's capital stock or securities or the making of capital
contributions with respect thereto (an "Investment") unless (A) if
such Investment is in a Person predominantly engaged in the Retail
Business, the purchase price and dollar amount of capital
contributions made with respect to such Investment is less than
50% of the Borrower's Consolidated Total Assets immediately prior
to such Investment or (B) if such Investment is in a Person
engaged predominantly in the Non-Retail Business, the purchase
price and dollar amount of capital contributions made with respect
to such Investment is less than 25% of the Borrower's Consolidated
Total Assets immediately prior to such Investment and (C) such
Investment is made with the permission of the Board of Directors
of the Person in whom the Investment is being made and immediately
prior to and after giving effect to such Investment no Event of
Default or Default shall exist. The foregoing limitation shall
not restrict the Borrower's and its Subsidiaries' ability to make
investments in the instruments described in Schedule VI hereto, as
such Schedule may be amended from time to time by the Borrower.
The Borrower shall provide the Agent and each Lender a copy of
each change or amendment made to Schedule VI promptly after each
such change or amendment thereof.
(iii) Mergers. Consummate, or permit the consummation of,
any merger or consolidation (regardless of whether it is otherwise
permitted by Section 7.02(c)) if immediately after giving effect
to such merger or consolidation the book value of Consolidated
Non-Retail Assets of the surviving corporation is greater than 25%
of the book value of Borrower's Consolidated Total Assets, or the
book value of the Consolidated Retail Assets of the surviving
corporation is greater than 50% of the Borrower's Consolidated
Total Assets, in each case immediately prior to such merger or
consolidation provided, that, Subsidiaries of the Borrower may
merge into or with the Borrower or any other Subsidiary of the
Borrower without regard to the restrictions of this
Section 7.02(d)(iii).
(e) Change in Nature of Business. Make any material change in
the nature of the business of the Borrower and its Subsidiaries as
conducted as of the date hereof.
SECTION 7.03Financial Covenant. The Borrower will not, without
the written consent of the Majority Combined Lenders, permit the ratio of Debt
on the last day of any Fiscal Quarter of the Borrower to EBITDA for the period
of four consecutive Fiscal Quarters of the Borrower ending on such day to be
greater than 3.00 to 1.00.
SECTION 7.04Reporting Requirements. The Borrower will furnish to
the Lenders:
(i) as soon as available and in any event within 60 days after
the end of each of the first three Fiscal Quarters of the Borrower,
Consolidated balance sheets of the Borrower and its Subsidiaries as of
the end of such Fiscal Quarters and Consolidated statements of income
and retained earnings of the Borrower and its Subsidiaries for the
period commencing at the end of the previous Fiscal Year and ending with
the end of such Fiscal Quarter, certified by the chief financial officer
or treasurer of the Borrower and accompanied by a certificate of said
officer stating (i) that such have been prepared in accordance with
generally accepted accounting principles, (ii) whether or not he or she
has knowledge of the occurrence of any Event of Default or Default and,
if so, stating in reasonable detail the facts with respect thereto and
(iii) whether or not the Borrower is in compliance with the requirements
set forth in Section 7.03 (which certificate shall contain the
computations used by such chief financial officer in determining such
compliance or non-compliance);
(ii) as soon as available and in any event within 120 days after
the end of each Fiscal Year of the Borrower, a copy of the annual report
for such year for the Borrower and its Subsidiaries, containing
Consolidated financial statements of the Borrower and its Subsidiaries
for such Fiscal Year certified in a manner acceptable to the Majority
Combined Lenders by Deloitte & Touche or other independent public
accountants reasonably acceptable to the Majority Combined Lenders;
(iii) within 120 days after the end of each Fiscal Year of the
Borrower, a certificate of the chief financial officer or treasurer of
the Borrower stating (i) whether or not he or she has knowledge of the
occurrence of any Event of Default or Default and, if so, stating in
reasonable detail the facts with respect thereto, and (ii) whether or
not the Borrower is in compliance with the requirements set forth in
Section 7.03 (which certificate shall contain the computations used by
such chief financial officer in determining such compliance or
non-compliance);
(iv) as soon as possible and in any event within five days after
a Responsible Officer becomes aware of each Event of Default and
Default, a statement of a Responsible Officer of the Borrower setting
forth details of such Event of Default or Default and the action which
the Borrower has taken and proposes to take with respect thereto;
(v) promptly after the sending or filing thereof, copies of all
reports which the Borrower sends to any of its security holders, and
copies of all reports and registration statements which the Borrower or
any Subsidiary files with the Securities and Exchange Commission or any
national securities exchange;
(vi) promptly after the filing or receiving thereof, copies of
all reports and notices which the Borrower or any Subsidiary files under
ERISA with the Internal Revenue Service or the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or which the Borrower or any
Subsidiary receives from such entities other than immaterial regular
periodic notices and reports and notices and reports of general
circulation;
(vii) within 90 days after the end of each Fiscal Year of the
Borrower, a summary, prepared by a Responsible Officer of the Borrower,
of the Borrower's (and its Subsidiaries') major insurance coverages (and
the amount of self-insurance) then in effect; and
(viii) such other information respecting the condition or
operations, financial or otherwise, of the Borrower or any of its
Subsidiaries as the Issuing Bank, or any Lender through the Agent, may
from time to time reasonably request.
ARTICLE VIIIEVENTS OF DEFAULT
SECTION 8.01Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower or any LC Subsidiary shall fail to pay any
principal of any Advance or any reimbursement obligation under any
Letter of Credit when the same becomes due and payable; or shall fail to
pay any interest on any Advance, fees or any other amounts hereunder
within two days after the same become due and payable by it; or
(b) Any representation or warranty made by the Borrower herein
(whether made on behalf of itself, an LC Subsidiary or otherwise) or by
the Borrower (or any of its officers) in connection with this Agreement
shall prove to have been incorrect in any material respect when made; or
(c) The Borrower shall fail to perform or observe (i) the
covenant contained in Section 7.03; or (ii) any term, covenant or
agreement contained in Section 7.02(c) or (d) for a period of five days
after written notice thereof shall have been given to the Borrower by
the Issuing Bank, the Agent or any Lender; or (iii) any other term,
covenant or agreement contained in this Agreement on its part to be
performed or observed if the failure to perform or observe such other
term, covenant or agreement shall remain unremedied for 30 days after
written notice thereof shall have been given to the Borrower by the
Issuing Bank, the Agent or any Lender; or
(d) The Borrower or any of its Subsidiaries shall fail to pay
any principal of or premium or interest on any Debt which is outstanding
in a principal amount of at least $10,000,000 in the aggregate (but
excluding Debt hereunder) of the Borrower or such Subsidiary (as the
case may be), when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Debt; or any other event shall occur or condition shall exist under
any agreement or instrument relating to any such Debt and shall continue
after the applicable grace period, if any, specified in such agreement
or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt
(other than any such Debt owed to a Lender or an Affiliate of a Lender
if such event or condition shall relate solely to a restriction on the
pledge or other disposition of Margin Stock owned by the Borrower or any
of its Subsidiaries); or any such Debt shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled
required prepayment), redeemed, purchased or defeased, or an offer to
prepay, redeem, purchase or defease such Debt shall be required to be
made, in each case prior to the stated maturity thereof; or
(e) The Borrower or any of its Subsidiaries shall generally not
pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by
or against the Borrower or any of its Subsidiaries seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry
of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted
against it (but not instituted by it), either such proceeding shall
remain undismissed or unstayed for a period of 60 days, or any of the
actions sought in such proceeding (including, without limitation, the
entry of an order for relief against, or the appointment of a receiver,
trustee, custodian or other similar official for, it or for any
substantial part of its property) shall occur; or the Borrower or any of
its Subsidiaries shall take any corporate action to authorize any of the
actions set forth above in this subsection (e); or
(f) Any judgment or order for the payment of money in excess of
$10,000,000 shall be rendered against the Borrower or any of its
Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there
shall be any period of ten consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(g) a Change of Control shall have occurred;
then, and in any such event, the Agent shall at the request, or may with
the consent, of the Majority Combined Lenders, by notice to the
Borrower, (A) declare the obligation of each A Lender to make Advances
to be terminated, whereupon the same shall forthwith terminate, (B)
declare the Advances, all interest thereon and all other amounts payable
under this Agreement to be forthwith due and payable, whereupon the
Advances, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by
the Borrower, (C) declare the obligation of the Issuing Bank to issue
further Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and/or (D) demand that the Borrower, and if such
demand is made the Borrower shall, pay to the Agent for the benefit of
the Issuing Bank, an amount in immediately available funds equal to the
then outstanding Letter of Credit Liability (plus the amounts specified
by Section 3.12, if applicable) which shall be held by the Agent (or the
Issuing Bank) as cash collateral in a cash collateral account under the
exclusive control and dominion of the Agent (or Issuing Bank) and
applied to the reduction of such Letter of Credit Liability as drawings
are made on outstanding Letters of Credit; provided, however, that in
the event of an actual or deemed entry of an order for relief with
respect to the Borrower or any of its Subsidiaries under the Federal
Bankruptcy Code, the obligation of each A Lender to make A Advances
shall automatically be terminated, the then outstanding Advances, all
such interest and all such amounts shall automatically become and be due
and payable, without presentment, demand, protest or any notice of any
kind, all of which are hereby expressly waived by the Borrower and the
obligation of the Issuing Bank to Issue Letters of Credit shall
automatically be terminated.
ARTICLE IXTHE AGENT
SECTION 9.01Authorization and Action. Each Lender and the Issuing
Bank hereby appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated
to the Agent by the terms hereof, together with such powers as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement or collection of the
Advances), the Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall
be fully protected in so acting or refraining from acting) upon the
instructions of the Majority Combined Lenders, and such instructions shall be
binding upon all Lenders; provided, however, that the Agent shall not be
required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or applicable law. The Agent agrees to
give to each Lender prompt notice of each notice given to it by the Borrower
pursuant to the terms of this Agreement unless the distribution of such notice
is otherwise provided for herein.
The Issuing Bank shall act on behalf of the LC Lenders with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may elect to act
for such Issuing Bank with respect thereto; provided, however, that the
Issuing Bank shall have all of the benefits and immunities (i) provided to the
Agent in this Article IX with respect to any acts taken or omissions suffered
by the Issuing Bank in connection with Letters of Credit Issued by it or
proposed to be Issued by it and the application and agreements for letters of
credit pertaining to the Letters of Credit as fully as if the term "Agent", as
used in this Article IX, included the Issuing Bank with respect to such acts
or omissions, and (ii) as additionally provided in this Agreement with respect
to the Issuing Bank.
SECTION 9.02Agent's Reliance, Etc. Neither the Agent nor any of
its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agent: (i) may
treat the Lender which made any Advance (or purchased or funded a
participation with respect to a Letter of Credit) as the holder and owner of
the Debt resulting therefrom until the Agent receives and accepts an
Assignment and Acceptance entered into by such Lender, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 10.07; (ii) may consult
with legal counsel (including counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (iii) makes no warranty or
representation to any Lender and shall not be responsible to any Lender for
any statements, warranties or representations (whether written or oral) made
in or in connection with this Agreement; (iv) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of this Agreement on the part of the Borrower
or to inspect the property (including the books and records) of the Borrower
or its Subsidiaries; (v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; and (vi) shall incur no liability under or in respect of this
Agreement by acting upon any notice, consent, certificate or other instrument
or writing (which may be by telecopier, telegram, cable or telex) believed by
it to be genuine and signed or sent by the proper party or parties.
SECTION 9.03CUSA, Citibank and Affiliates. With respect to CUSA's
A Commitment, its LC Commitment and the Advances made by it, and with respect
to Citibank as Issuing Bank, CUSA and Citibank shall have the same rights and
powers under this Agreement as any other Lender and may exercise the same as
though it were not the Agent or Issuing Bank, as the case may be; and the term
"Lender" or "Lenders" shall, unless otherwise expressly indicated, include
CUSA and Citibank in their individual capacities. CUSA, Citibank and each of
their respective Affiliates (and, as applicable, any of their respective
officers and directors) may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any kind of business
with, the Borrower, any of its Subsidiaries and any Person who may do business
with or own securities of the Borrower or any such Subsidiary, all as if CUSA
were not the Agent or Citibank were not the Issuing Bank, as the case may be,
and without any duty to account therefor to the Lenders.
SECTION 9.04Lender Credit Decision. Each Lender acknowledges that
it has, independently and without reliance upon the Agent, the Issuing Bank or
any other Lender and based on the financial statements referred to in Section
6.01 and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Agent, the Issuing Bank 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.
SECTION 9.05Indemnification. (a) Agent. The Lenders agree to
indemnify the Agent (to the extent not reimbursed by the Borrower or any
LC Subsidiary), ratably, according to their respective Credit Exposures, 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
the Agent in any way relating to or arising out of this Agreement or any
action taken or omitted by the Agent under this Agreement, provided, that, no
Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender agrees to
reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including counsel fees) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that the Agent is not
reimbursed for such expenses by the Borrower. In the case of any
investigation, litigation or proceeding giving rise to any such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs
expenses or disbursements, this Section 9.05(a) applies whether any such
investigation, litigation or proceeding is brought by the Agent, the Issuing
Bank, any Lender or a third party.
(b) Issuing Bank. The LC Lenders agree to indemnify the Issuing
Bank (to the extent not reimbursed by the Borrower or any LC Subsidiary),
ratably according to their respective LC Commitment Percentages, 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
the Issuing Bank in any way relating to or arising out of this Agreement and
the Letters of Credit or any action taken or omitted by the Issuing Bank under
this Agreement or the Letters of Credit, provided, that, no LC Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Issuing Bank's gross negligence or willful misconduct.
Without limitation of the foregoing, each LC Lender agrees to reimburse the
Issuing Bank promptly upon demand for its ratable share of any out-of-pocket
expenses (including counsel fees) incurred by the Issuing Bank in connection
with the preparation, execution, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
or the Letters of Credit, to the extent that the Issuing Bank is not
reimbursed for such expenses by the Borrower. In the case of any
investigation, litigation or proceeding giving rise to any such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs
expenses or disbursements, this Section 9.05(b) applies whether any such
investigation, litigation or proceeding is brought by the Issuing Bank, the
Agent, any Lender or a third party.
SECTION 9.06Successor Agent/Issuing Bank (a) Agent. The Agent
may resign at any time by giving ten days' prior written notice thereof to the
Lenders and the Borrower and may be removed at any time with or without cause
by the Majority Combined Lenders; provided, that, the Agent may resign without
having given such notice if it is required to do so as a matter of law. Upon
any such resignation or removal, the Majority Combined Lenders, after
consulting with the Borrower and giving due consideration to any successor
agent recommended by the Borrower, shall have the right to appoint a successor
Agent with the consent of the Borrower (which shall not be unreasonably
withheld). If no successor Agent shall have been so appointed by the Majority
Combined Lenders and consented to by the Borrower, and shall have accepted
such appointment, within 30 days after the retiring Agent's giving of notice
of resignation or the Majority Combined Lenders' removal of the retiring
Agent, then the retiring Agent may, after consulting with the Borrower and
giving due consideration to any successor agent recommended by the Borrower,
on behalf of the Lenders, appoint a successor Agent, which shall be a
commercial bank organized or licensed to do business under the laws of the
United States of America or of any State thereof and having a combined capital
and surplus of at least $50,000,000. 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 or removal hereunder as Agent, the provisions of this Article IX
shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent under this Agreement.
(b) Issuing Bank. The Issuing Bank may be removed at any time
with or without cause jointly by the Majority Combined Lenders and the
Borrower. Upon any removal of the Issuing Bank, the Majority Combined Lenders
and the Borrower shall jointly have the right to appoint a successor Issuing
Bank. If no successor Issuing Bank shall have been so appointed by the
Majority Combined Lenders and the Borrower, and shall have accepted such
appointment, within 30 days after the removal of the Issuing Bank, the Issuing
Bank may, on behalf of the Lenders appoint a successor Issuing Bank, which
shall be a commercial bank organized or licensed to do business under the laws
of the United States of America or of any State thereof and having a combined
capital and surplus of at least $50,000,000. Upon the acceptance of any
appointment as Issuing Bank, such successor Issuing Bank shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Issuing Bank, and the Issuing Bank shall be discharged
from its duties and obligations under this Agreement. After any retiring
Issuing Bank is removed hereunder as Issuing Bank, the provisions of this
Article IX shall inure to its benefit as to any actions taken by it while it
was Issuing Bank under this Agreement. Notwithstanding the foregoing, the
Issuing Bank may not be removed unless prior to or contemporaneously with such
removal it shall have received a Dollar amount, in immediately available
funds, equal to all outstanding Letter of Credit Liability then outstanding
and then owing to the Issuing Bank and shall have been indemnified by the
Borrower, the LC Lenders and such successor Issuing Bank, to the Issuing
Bank's satisfaction, against all Letter of Credit Liability. The fee letter
referred to in Section 3.05(b) (or any replacement thereof) shall continue to
inure to such Issuing Bank's benefit, and such Issuing Bank shall continue to
be bound thereby, until such time as all Letter of Credit Liability
outstanding on the effective date of such Issuing Bank's removal has been
discharged in full.
ARTICLE XMISCELLANEOUS
SECTION 10.01Amendments, Etc. (a) Majority Combined Lenders.
Except as is otherwise expressly provided in this Section 10.01, no amendment
or waiver of any provision of this Agreement, nor consent to any departure by
the Borrower therefrom, shall in any event be effective unless the same shall
be in writing and signed by the Majority Combined Lenders.
(b) Majority A Lenders. The Majority A Lenders may (and shall
have the exclusive right to), in writing, amend, waive or consent to any
departure from Article II hereof (and the definitions used therein) and
Article IV hereof as it relates to the A Advances, without the consent of the
Majority Combined Lenders; provided, however, that no amendment, waiver or
consent (whether effected by the Majority A Lenders pursuant to this
subsection (b) or by the Majority Combined Lenders pursuant to subsection (a))
shall, unless in writing and signed by all the A Lenders, do any of the
following: (i) waive any of the conditions specified in Section 5.01 or 5.02
as they relate to A Borrowings and A Advances, (ii) increase the A Commitments
of the A Lenders (other than as provided for in Section 2.05(b)) or subject
the A Lenders to any additional obligations, (iii) reduce the principal of, or
interest on, the A Advances or any fees or other amounts payable hereunder to
the A Lenders, (iv) postpone any date fixed for any payment of principal of,
or interest on, the A Advances or any fees or other amounts payable hereunder
to the A Lenders (other than as permitted by Section 2.14), (v) change the
percentage of the A Commitments or of the aggregate unpaid principal amount of
the A Advances, or the number of A Lenders, which shall be required for the
A Lenders or any of them to take any action hereunder or (vi) amend this
subsection (b) of this Section 10.01.
(c) Majority LC Lenders. The Majority LC Lenders may (and shall
have the exclusive right to), in writing, amend, waive or consent to any
departure from Article III hereof (and the definitions used therein) and
Article IV hereof as it relates to the Letters of Credit, without the consent
of the Majority Combined Lenders; provided, however, that no amendment, waiver
or consent (whether effected by the Majority LC Lenders pursuant to this
subsection (c) or by the Majority Combined Lenders pursuant to subsection (a))
shall, unless in writing and signed by all the LC Lenders, do any of the
following: (i) waive any of the conditions specified in Section 5.01 or 5.02,
as they relate to the Issuance of Letters of Credit, (ii) increase the
LC Commitments of the LC Lenders (other than as provided for in Section 3.11)
or subject the LC Lenders to any additional obligations, (iii) reduce any
amounts due hereunder or any fees or other amounts payable hereunder with
respect to the Letters of Credit to the LC Lenders or the Issuing Bank,
(iv) postpone any date fixed for any payment of any fees or other amounts
payable hereunder with respect to the Letters of Credit to the LC Lenders or
the Issuing Bank, (v) change the percentage of the LC Commitments or of the
aggregate unpaid Letter of Credit Liability hereunder, or the number of
LC Lenders, which shall be required for the LC Lenders or any of them to take
any action hereunder, (vi) release the Borrower from its obligation to comply
with Section 3.13 or (vii) amend this subsection (c) of this Section 10.01.
(d) Agent and Issuing Bank. No amendment, waiver or consent
given or effected pursuant to this Section 10.01 shall, unless in writing and
signed by the Agent or the Issuing Bank, as the case may be, in addition to
the Lenders required above to take such action, affect the rights, obligations
or duties of the Agent or the Issuing Bank, as the case may be, under this
Agreement.
(e) Limitation of Scope. All waivers and consents granted under
this Section 10.01 shall be effective only in the specific instance and for
the specific purpose for which given.
SECTION 10.02Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, sent by overnight courier,
telecopied, telegraphed, telexed, cabled or delivered, if to the Borrower, at
its address at 900 Cherry Avenue, San Bruno, CA 94066 Attention: Treasurer;
if to any Lender, at its Domestic Lending Office specified opposite its name
on Schedule I hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assignment and Acceptance pursuant to which it became a
Lender; if to the Agent, at its address at 399 Park Avenue, New York, New York
10043, Attention: Credit Administration; and if to the Issuing Bank, at its
address at 399 Park Avenue, New York, New York 10043, Attention: Letter of
Credit Administration; with a copy, in the case of notices to the Agent or the
Issuing Bank, to Citicorp North America, Inc., One Sansome Street, San
Francisco, California, Attention: Carolyn Wendler, or, as to each party, at
such other address or to such other person as shall be designated by such
party in a written notice to the other parties. All such notices and
communications shall, when mailed, be effective three days after being
deposited in the mails, when sent by overnight courier, be effective one day
after being sent by overnight courier, when telecopied or delivered to the
telegraph company, be effective when received or delivered to the cable
company, respectively; and when delivered by hand, be effective upon delivery
except that notices and communications to the Agent pursuant to Article II or
IX and to the Issuing Bank pursuant to Article III or IX shall not be
effective until received by the Agent or Issuing Bank, as the case may be.
SECTION 10.03No Waiver; Remedies. No failure on the part of any
Lender, the Issuing Bank or the Agent to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 10.04Costs and Expenses. (a) The Borrower agrees to pay
on demand all costs and expenses of the Agent and Issuing Bank incurred in
connection with the preparation, execution, delivery, modification and
amendment of this Agreement, and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Agent and Issuing Bank with respect
thereto and with respect to advising the Agent and Issuing Bank as to their
respective rights and responsibilities under this Agreement with respect
thereto. The Borrower further agrees to pay on demand all costs and expenses
of the Agent, the Issuing Bank and each Lender (including, without limitation,
reasonable counsel fees and expenses), incurred in connection with the
enforcement (whether through negotiations, legal proceedings or otherwise) of
this Agreement and the other documents to be delivered hereunder, including,
without limitation, reasonable counsel fees and expenses in connection with
the enforcement of their respective rights hereunder.
(b) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made other than on the last day of the Interest
Period for such A Advance, as a result of a payment or Conversion pursuant to
Section 2.05(b), 2.09(d), 2.11, 2.13 or 2.14 or acceleration of the maturity
of the Advances pursuant to Section 8.01 or for any other reason, the Borrower
shall, upon demand by any A Lender (with a copy of such demand to the Agent),
pay to the Agent for the account of such A Lender any amounts required to
compensate such A Lender for any additional losses, costs or expenses which it
may reasonably incur as a result of such payment or Conversion, including,
without limitation, any loss (including loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any A Lender to fund or maintain such A Advance.
(c) The Borrower agrees to indemnify and hold harmless each of
the Agent, each Lender and the Issuing Bank and each of their Affiliates and
their respective officers, directors, employees, agents and advisors (each, an
"Indemnified Party") from and against any and all claims, damages, liabilities
and expenses (including, without limitation, fees and disbursements of
counsel), which may be incurred by or asserted against any Indemnified Party
in connection with or arising out of any investigation, litigation, or
proceeding (whether or not such Indemnified Party is party thereto) related to
any acquisition or proposed acquisition by the Borrower, or by any Subsidiary
of the Borrower, of all or any portion of the stock or substantially all the
assets of any Person or any use or proposed use of the Advances or Letters of
Credit by the Borrower or any LC Subsidiary, except to the extent such claim,
damage, liability or expense is found in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted from such Indemnified Party's
gross negligence or willful misconduct. In the event this indemnity is
unenforceable as a matter of law as to a particular matter or consequence
referred to herein, it shall be enforceable to the full extent permitted by
law. The indemnification provisions set forth above shall be in addition to
any liability the Borrower may otherwise have. Without prejudice to the
survival of any other obligation of the Borrower hereunder, the indemnities
and obligations of the Borrower contained in this Section 10.04 shall survive
the payment in full of all the Obligations.
(d) The Borrower hereby acknowledges that the funding method by
each Lender of its Advances hereunder shall be in the sole discretion of such
Lender. The Borrower agrees that for purposes of any determination to be made
under Sections 2.08, 2.12(a), 2.13 or 10.04(b) of this Agreement each Lender
shall be deemed to have funded its Eurodollar Rate Advances with proceeds of
Dollar deposits in the London interbank market.
SECTION 10.05Right of Setoff. Upon (i) the occurrence and during
the continuance of any Event of Default and (ii) the making of the request or
the granting of the consent specified by Section 8.01 to authorize the Agent
to declare the Advances due and payable pursuant to the provisions of Section
8.01 or to demand payment of (or cash collateralization of) all then
outstanding Letter of Credit Liability, each Lender and each of its Affiliates
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender or such Affiliate to or for the
credit or the account of the Borrower or any LC Subsidiary against any and all
of the obligations of the Borrower or any LC Subsidiary now or hereafter
existing under this Agreement to such Lender (including, to the fullest extent
permitted by law, obligations indirectly owed to such Lender by virtue of its
purchase of a participation or sub-participation of the Letter of Credit
Liability pursuant to Section 3.04), whether or not such Lender shall have
made any demand under this Agreement and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Borrower after any such
set-off and application made by such Lender or any of its Affiliates,
provided, that, the failure to give such notice shall not affect the validity
of such set-off and application. The rights of each Lender and its Affiliates
under this Section are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which such Lender and its
Affiliates may have.
SECTION 10.06Binding Effect. This Agreement shall become
effective when it shall have been executed by the Borrower, each LC Subsidiary
to be a party hereto on the date hereof, the Issuing Bank and the Agent and
when the Agent shall have been notified by each Bank that such Bank has
executed it and thereafter shall be binding upon and inure to the benefit of
the Borrower, each LC Subsidiary, the Issuing Bank, the Agent and each Lender
and their respective successors and assigns, except that the Borrower and each
LC Subsidiary shall not have the right to assign its respective rights
hereunder or any interest herein without the prior written consent of the
Lenders.
SECTION 10.07Assignments and Participations. (a) Each Lender
may, and if demanded by the Borrower (following a demand by such Lender
pursuant to Section 2.08, 2.12, 3.07, 4.02 or 4.06, after such Lender has
declined to vote in favor of extension of the Revolver Termination Date or LC
Termination Date, as the case may be, pursuant to Section 2.14 or 3.11, or
after any Lender has assigned all or any portion of its rights and obligations
under this Agreement to any Affiliate without the consent of the Borrower,
upon at least 10 days' notice to such Lender and the Agent), will, assign to
one or more banks or other entities all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion, respectively, of its A Commitment and the A Advances owing to it
and/or of its LC Commitment and participations in Letter of Credit Liability);
provided, however, that (i) each such respective assignment shall be of a
percentage of all rights and obligations under this Agreement (other than any
B Advances) (w) in respect of the assigning A Lender's A Commitment and A
Advances and/or (x) in respect of the assigning Lender's LC Commitment and
participations in Letter of Credit Liability, as the case may be, that is
constant and not varying over time, (ii) the respective amounts of the rights
and obligations (y) under the A Commitment and A Advances of the assigning A
Lender and/or (z) under the LC Commitment and participations in Letter of
Credit Liability of the assigning lender, as the case may be, being assigned
pursuant to each such assignment (determined as of the date of the Assignment
and Acceptance with respect to such assignment) shall in no event be less than
5% of all such rights and obligations or less than $5,000,000 (or an integral
multiple of $500,000 in excess thereof), as the case may be, in the case of
each of (y) and/or (z), (iii) each such assignment shall be to an Eligible
Assignee consented to by the Borrower (which shall not unreasonably withhold
its consent); provided, that, the Borrower's consent need not be obtained if
such assignment is made to an Affiliate of the assigning Lender, provided that
any Lender so assigning to any of its Affiliates shall give prompt notice
thereof to the Borrower and the Agent, (iv) each such assignment made as a
result of a demand by the Borrower pursuant to this Section 10.07(a) shall be
arranged by the Borrower (at its expense, including, without limitation,
payment of the processing and recordation fee referred to in subclause (vi)
hereof) after consultation with the Agent and shall be either an assignment of
all of the rights and obligations of the assigning Lender under this Agreement
or an assignment of a portion of such rights and obligations made concurrently
with another such assignment or other such assignments which together cover
all of the rights and obligations of the assigning Lender under this
Agreement, (v) no Lender shall be obligated to make any such assignment as a
result of a demand by the Borrower pursuant to this Section 10.07(a) unless
and until such Lender shall have received one or more payments from either the
Borrower or one or more Eligible Assignees in an aggregate amount at least
equal to the aggregate outstanding principal amount of the Advances owing to
such Lender, together with accrued interest thereon to the date of payment of
such principal amount and all other amounts payable to such Lender under this
Agreement, and (vi) the parties to each such assignment shall execute and
deliver to the Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with a processing and recordation fee of
$2,000; provided, that, no such fee shall be payable in connection with an
assignment by an assigning Lender to an Affiliate of such assigning Lender.
Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto). Without
limiting the qualifications set forth in the first sentence of this Section
10.07(a), but to clarify such sentence, any Lender having both an A Commitment
and an LC Commitment may assign all or a portion of its rights and obligations
relating to one of these commitments and at the same time assign none, all,
the same portion or a different portion of its rights and obligations relating
to the other commitment, provided that any assignment of any portion
(including all) of a Lender's rights and obligations relating to its A
Commitment shall include an assignment of the same portion (including all if
applicable) of such Lender's rights and obligations relating to its A Advances
and any assignment of any portion (including all) of a Lender's rights and
obligations relating to its LC Commitment shall include an assignment of the
same portion (including all if applicable) of such Lender's rights and
obligations relating to participations in Letter of Credit Liability.
(b) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than
as provided in such Assignment and Acceptance, such 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 or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or any LC Subsidiary or the performance or
observance by the Borrower or any LC Subsidiary of any of its obligations
under this Agreement or any other instrument or document furnished pursuant
hereto; (iii) such assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
Section 6.01 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 Agent, the Issuing Bank, such assigning 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 confirms that it
is an Eligible Assignee; (vi) such assignee appoints and authorizes the Agent
or the Issuing Bank to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent or the Issuing
Bank by the terms hereof, together with such powers as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Lender.
(c) The Agent shall maintain at its address referred to in
Section 10.02 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recordation of the names and addresses
of the Lenders and the LC Commitment of and A Commitment of, and principal
amount of the Advances owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for
all purposes, absent manifest error, and the Borrower, the Agent and the
Lenders may treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender and an assignee representing that it is an Eligible
Assignee, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit B hereto, (i) accept
such Assignment and Acceptance, (ii) record the information contained therein
in the Register and (iii) give prompt notice thereof to the Borrower.
(e) Each Lender may assign or participate to one or more banks
or other entities any B Advance held by it without regard to any of the
restrictions placed on assignments elsewhere in this Section 10.07 or this
Agreement; provided, that, any participation shall be made in accordance with
subsection (f) hereof and provided, further, that any assignee of a B Advance
that is not then a Lender hereunder shall not be entitled to demand any
payments under Section 2.08, 2.12 or 4.02 hereof and shall have no voting
rights or other rights of a Lender hereunder other than the right to demand
and receive interest and principal payments at the times when due with respect
to the B Advance owned by it.
(f) Each Lender may sell participations to one or more banks or
other entities in or to all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its
A Commitment and LC Commitment and the Advances owing to it; provided,
however, that (i) such Lender's obligations under this Agreement (including,
without limitation, its A Commitment to the Borrower hereunder and
LC Commitment) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the owner of any Advance for all
purposes of this Agreement, and (iv) the Borrower, the Issuing Bank, the Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement, provided, further, that, to the extent of any such participation
(unless otherwise stated therein and subject to the preceding proviso), the
purchaser of such participation shall, to the fullest extent permitted by law,
have the same rights and benefits hereunder as it would have if it were a
Lender hereunder; and provided, further, that each such participation shall be
granted pursuant to an agreement providing that the purchaser thereof shall
not have the right to consent or object to any action by the selling Lender
(who shall retain such right) other than an action which would (i) reduce
principal of or interest on any Advance, any amount due hereunder with respect
to the Letters of Credit or other amounts or fees in which such purchaser has
an interest, (ii) postpone any date fixed for payment of principal of or
interest on any such Advance, such amounts due with respect to Letters of
Credit or other amounts or such fees, or (iii) extend the LC Termination Date
or the Revolver Termination Date, as the case may be.
(g) Upon written request of the Borrower to an A Lender, such
A Lender shall, to the extent consistent with the policies of such A Lender,
inform the Borrower of the Dollar amount of any Full Term Participation (as
hereinafter defined) that such A Lender has entered into; provided, however,
that no A Lender shall be obligated to disclose such information if the
disclosure thereof would constitute a violation of law or regulation or
violate any confidentiality agreement to which such A Lender is subject. For
the purposes of this subsection (g), "Full Term Participation" means a
participation by an A Lender to another Person whereby such other Person has
purchased (pursuant to a participation agreement) all or a portion of such
A Lender's A Commitment from the effective date of such participation
agreement to the Revolver Termination Date.
(h) Notwithstanding anything herein contained to the contrary,
each Lender may assign any of its rights and obligations under this Agreement
to any of its Affiliates without the consent of the Borrower or the Agent,
provided that any Lender so assigning to any of its Affiliates shall give
prompt notice thereof to the Borrower and the Agent; and each Lender or any of
its Affiliates may assign any of its rights (including, without limitation,
rights to payment of principal and/or interest hereunder) under this Agreement
to any Federal Reserve Bank without notice to or consent of the Borrower or
the Agent.
SECTION 10.08Severability of Provisions. 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 or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 10.09Independence of Provisions. All agreements and
covenants hereunder shall be given independent effect such that if a
particular action or condition is prohibited by the terms of any such
agreement or covenant, the fact that such action or condition would be
permitted within the limitations of another agreement or covenant shall not be
construed as allowing such action to be taken or condition to exist.
SECTION 10.10Confidentiality. Each Lender, the Issuing Bank and
the Agent agrees that it will not disclose to any third party any written
information marked "Confidential" provided to it by the Borrower; provided,
that, the foregoing will not (i) restrict the ability of the Agent, the
Issuing Bank, the Lenders and any loan participants from freely exchanging
such information among themselves (and their respective employees, attorneys,
agents and advisors), (ii) restrict the ability to disclose such information
to a prospective Eligible Assignee or participant, provided, that, such
Eligible Assignee or participant executes a confidentiality agreement with the
selling Lender agreeing to be bound by the terms hereof prior to disclosure of
such information to such Eligible Assignee or participant or (iii) prohibit
the disclosure of such information to the extent such information (a) becomes
publicly available, (b) becomes available through a Person not a Subsidiary,
(c) is required to be disclosed pursuant to court order, subpoena, other legal
process, regulatory request or otherwise by law or (d) is disclosed in
litigation with the Borrower or any of its Subsidiaries.
SECTION 10.11Headings. Article and Section headings in this
Agreement are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
SECTION 10.12Entire Agreement. This Agreement sets forth the
entire agreement of the parties with respect to its subject matter and, except
for the letter agreement referred to in Sections 2.04(c) and 3.05(b),
supersedes all previous understandings, written or oral, in respect thereof.
SECTION 10.13Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
SECTION 10.14Consent to Jurisdiction. (a) Each of the parties
hereto hereby irrevocably submits to the jurisdiction of any New York State or
Federal court sitting in the County of New York, The City of New York, in any
action or proceeding arising out of or relating to this Agreement, and each of
the parties hereby irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such New York State court
or such Federal court. Each of the parties hereby irrevocably agrees, to the
fullest extent each may effectively do so, that each will not assert any
defense that such courts do not have subject matter or personal jurisdiction
of such action or proceeding or over any party hereto. Each of the parties
hereby irrevocably consents to the service of copies of the summons and
complaint and any other process which may be served in any such action or
proceeding by certified mail, return receipt requested, or by delivering of a
copy of such process to such party at its address specified in Section 10.02
or by any other method permitted by law. Each of the parties hereby agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or by any other
manner provided by law.
(b) Nothing in this Section 10.14 shall affect the right of any
of the parties hereto to serve legal process in any other manner permitted by
law or affect the right of any of the parties to bring any action or
proceeding against any of the parties or their property in the courts of other
jurisdictions.
SECTION 10.15GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, EXCEPT,
IN THE CASE OF ARTICLE III, TO THE EXTENT SUCH LAWS ARE INCONSISTENT WITH THE
UCP.
SECTION 10.16WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
LC SUBSIDIARIES, THE AGENT, THE LENDERS AND THE ISSUING BANK HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
ADVANCES OR THE LETTERS OF CREDIT, OR THE ACTIONS OF THE AGENT, ANY LENDER OR
THE ISSUING BANK IN CONNECTION WITH THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly authorized, as of
the date first above written.
THE BORROWER:
THE GAP, INC.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Senior Vice President and
Chief Financial Officer
THE LC SUBSIDIARIES:
BANANA REPUBLIC, INC.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Senior Vice President and
Chief Financial Officer
GPS (U.S.A.) LIMITED
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Senior Vice President and
Chief Financial Officer
GAP (CANADA) INC.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Senior Vice President and
Chief Financial Officer
GLORIOUS DAY COMPANY LIMITED (to be
renamed GAP INTERNATIONAL SOURCING
LIMITED)
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Director
GAP INTERNATIONAL SOURCING PTE. LTD.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Director
GAP (JAPAN) K.K.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Director
GAP INTERNATIONAL SOURCING LIMITED
(to be renamed GAP INTERNATIONAL
SOURCING (HOLDINGS) LIMITED)
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Director
GAP (NETHERLANDS) B.V.
By /s/ Warren R. Hashagen
Name: Warren R. Hashagen
Title: Director
THE AGENT:
CITICORP USA INC.
By /s/ Marjorie Futornick
Name: Marjorie Futornick
Title: Vice President
THE BANKS:
A Commitment CITICORP USA INC.
$36,842,105.26
LC Commitment
$47,368,421.05 By /s/ Marjorie Futornick
Name: Marjorie Futornick
Title: Vice President
A Commitment BANK OF AMERICA NATIONAL
$31,315,789.47 TRUST & SAVINGS ASSOCIATION
LC Commitment
$40,263,157.89 By /s/ Maria Vickroy-Peralta
Name: Maria Vickroy-Peralta
Title: Vice President
A Commitment THE HONGKONG AND SHANGHAI $31,315,789.47
BANKING CORPORATION LIMITED
LC Commitment
$40,263,157.89 By /s/ J.C. Holsex
Name: J.C. Holsex
Title: Exec. Vice President
A Commitment NATIONSBANK OF TEXAS, N.A.
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Chas A. McDonell
Name: Chas A. McDonell
Title: Vice President
A Commitment THE ROYAL BANK OF CANADA
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Karen T. Hull
Name: Karen T. Hull
Title: Retail Group Manager
A Commitment BANK OF MONTREAL
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Beverly A. Blucher
Name: Beverly A. Blucher
Title: Senior Vice President
A Commitment SOCIETE GENERALE
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Maureen E. Kelly
Name: Maureen E. Kelly
Title: Vice President
A Commitment THE FUJI BANK, LIMITED
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Kazuo Kamio
Name: Kazuo Kamio
Title: General Manager
A Commitment MORGAN GUARANTY TRUST
$25,789,473.68 COMPANY OF NEW YORK
LC Commitment
$33,157,894.74 By /s/ Adam J. Silver
Name: Adam J. Silver
Title: Associate
A Commitment THE SUMITOMO BANK LIMITED
$25,789,473.68
LC Commitment
$33,157,894.74 By /s/ Kozo Masaki
Name: Kozo Masaki
Title: General Manager
A Commitment DEUTSCHE BANK AG NEW YORK BRANCH
$25,789,473.68 AND/OR CAYMAN ISLANDS BRANCH
LC Commitment
$33,157,894.74 By /s/ Joel D. Makowsky
Name: Joel D. Makowsky
Title: Assistant Vice President
By /s/ Susan M. O'Connor
Name: Susan M. O'Connor
Title: Director
A Commitment UNION BANK OF SWITZERLAND, NEW
$25,789,473.68 YORK BRANCH
LC Commitment
$33,157,894.74 By /s/ M. Terri Reilly
Name: M. Terri Reilly
Title: Assistant Treasurer
By /s/ Samuel Azizo
Name: Samuel Azizo
Title: Vice President
A Commitment U.S. NATIONAL BANK OF OREGON
$18,421,052.63
LC Commitment
$23,684,210.53 By /s/ Janet E. Jordan
Name: Janet E. Jordan
Title: Vice President
_________
$350,000,000 Total of the A Commitments
$450,000,000 Total of the LC Commitments
THE ISSUING BANK:
CITIBANK, N.A.
By /s/ Carolyn R. Bodmer
Name: Carolyn R. Bodmer
Title: Vice President
Schedule II
EXISTING LIENS
None
Schedule III
CHANGE OF CONTROL
1. Donald G. Fisher
2. Doris Fisher
3. Millard S. Drexler
4. Any person related by blood or marriage to any of the foregoing persons
and any trust as to which any of such persons has beneficial ownership
of the assets of the trust.
5. The executive officers of The Gap, Inc. as of July 1, 1997.
Schedule IV
OUTSTANDING BALANCE OF EXISTING LETTERS OF CREDIT
$450,000,000
Schedule V
LC SUBSIDIARIES
(As of date of this Agreement)
1. Banana Republic, Inc.
2. GPS (U.S.A.) Limited
3. Gap (Canada) Inc.
4. Glorious Day Company Limited (to be renamed Gap International Sourcing
Limited)
5. Gap International Sourcing Pte. Ltd.
6. Gap (Japan) K.K.
7. Gap International Sourcing Limited (to be renamed Gap International
Sourcing (Holdings) Limited)
8. Gap (Netherlands) B.V.
Schedule VI
PERMITTED INVESTMENTS
1. Obligations issued or guaranteed by the United States Government.
2. Commercial paper of issuers having a rating of P-1 by Moodys or A-1 by
S&P or a rating of not less than P-2 by Moodys and A-2 by S&P.
3. Banker's acceptances, certificates of deposit and eurodollar time
deposits (including bank money market funds) from commercial banks with
commercial paper ratings (or equivalent long-term debt ratings) as
specified in 2 above.
4. Tax-exempt securities rated Aaa by Moodys or AAA by S&P or Aa by Moodys
or AA by S&P or A by Moodys or A by S&P.
5. Secured repurchase agreements involving any of the instruments referred
to in 1-4 above and having the ratings specified in 1-4 above, as
applicable, with an institution or institutions whose commercial paper
(or long term debt rating) satisfies the criteria specified in 2 above.
6. Money market preferred stock (not issued by a thrift, saving and loans
institution or analogous institution) rated Aaa by Moodys or AAA by S&P.
7. Loan participations purchased from major money center banks provided the
borrower associated with such participation has a long-term debt rating
of P-1 by Moodys or A-1 by S&P or P-2 by Moodys and A-2 by S&P.
Moodys = Moody's Investors Service, Inc.
S&P = Standard & Poor's Corporation
Schedule VII
PLANS:
Gap VEBA Trust (Self-insured medical and dental claims)
GapShare Plan
Employee Benefit Premium Payment Plan - (Pre-tax employee contributions under
medical, dental plans)
Life Insurance and Accidental Death and Dismemberment Plan
Health Insurance Plan (HMOs and Employee Assistance Plan)
Short Term Disability Plan
Long Term Disability Plan
Tuition Reimbursement Program
Vision Care Plan
EXHIBIT A-1
NOTICE OF A BORROWING
Citicorp USA Inc., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, The Gap, Inc., refers to the Credit Agreement,
dated as of July 1, 1997 (the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, certain of the
undersigned's Subsidiaries, certain Lenders parties thereto, Citibank, N.A.,
as Issuing Bank, and Citicorp USA Inc. as Agent for said Lenders, and hereby
gives you notice, irrevocably, pursuant to Section 2.02 of the Credit
Agreement that the undersigned hereby requests an A Borrowing under the Credit
Agreement, and in that connection sets forth below the information relating to
such A Borrowing (the "Proposed A Borrowing") as required by Section 2.02(a)
of the Credit Agreement:
(i) The Business Day of the Proposed A Borrowing is ,
19 .
(ii) The Type of A Advances comprising the Proposed A
Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed A Borrowing is
$ .
(iv) The Interest Period for each A Advance made as part of
the Proposed A Borrowing is [ days] [ month[s]].
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed A
Borrowing:
(A) the representations and warranties contained in Section 6.01
are correct, before and after giving effect to the Proposed A Borrowing
and to the application of the proceeds therefrom, as though made on and
as of such date; and
(B) no event has occurred and is continuing, or would result
from such Proposed A Borrowing or from the application of the proceeds
therefrom, which constitutes an Event of Default or Default.
Very truly yours,
THE GAP, INC.
By
Name:
Title:
EXHIBIT A-2
NOTICE OF B BORROWING
Citicorp USA Inc. , as Agent
for the Lenders parties
to the Credit Agreement
referred to below
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, The Gap, Inc., refers to the Credit Agreement,
dated as of July 1, 1997 (the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, certain of the
undersigned's Subsidiaries, certain Lenders parties thereto, Citibank, N.A.,
as Issuing Bank, and Citicorp USA Inc. as Agent for said Lenders, and hereby
gives you notice pursuant to Section 2.03 of the Credit Agreement that the
undersigned hereby requests a B Borrowing under the Credit Agreement, and in
that connection sets forth the terms on which such B Borrowing (the "Proposed
B Borrowing") is requested to be made:
(A) Date of B Borrowing
(B) Amount of B Borrowing
(C) Maturity Date
(D) Interest Rate Basis
(E) Interest Payment Date(s)
(F)
(G)
(H)
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed B
Borrowing:
(a) the representations and warranties contained in Section 6.01
are correct, before and after giving effect to the Proposed B Borrowing
and to the application of the proceeds therefrom, as though made on and
as of such date;
(b) no event has occurred and is continuing, or would result
from the Proposed B Borrowing or from the application of the proceeds
therefrom, which constitutes an Event of Default or Default;
(c) no event has occurred and no circumstance exists as a result
of which the information concerning the undersigned that has been
provided to the Agent and each Lender by the undersigned in connection
with the Credit Agreement would, taken as a whole, include an untrue
statement of a material fact or omit to state any material fact or any
fact necessary to make the statements contained therein, in the light of
the circumstances under which they were made, not misleading; and
(d) the aggregate amount of the Proposed B Borrowing and all
other Borrowings to be made on the same day under the Credit Agreement
is within the aggregate amount of the unused A Commitments of the A
Lenders.
The undersigned hereby confirms that the Proposed B Borrowing is
to be made available to it in accordance with Section 2.03(a)(v) of the Credit
Agreement.
Very truly yours,
THE GAP, INC.
By
Name:
Title:
EXHIBIT B
ASSIGNMENT AND ACCEPTANCE
Dated , 19
Reference is made to the Credit Agreement dated as of July 1, 1997
(the "Credit Agreement") among The Gap, Inc., a Delaware corporation (the
"Borrower"), certain Subsidiaries of the Borrower, as "LC Subsidiaries", the
Lenders (as defined in the Credit Agreement), Citibank, N.A., as Issuing Bank,
and Citicorp USA Inc. as Agent for the Lenders and Issuing Bank (the "Agent").
Terms defined in the Credit Agreement are used herein with the same meaning.
(the "Assignor") and (the
"Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee, and
the Assignee hereby purchases and assumes from the Assignor, such respective
interests in and to all of the Assignor's rights and obligations under the
Credit Agreement as of the date hereof (other than in respect of B Advances)
which represent the respective percentage interests specified on Schedule 1 of
all outstanding rights and obligations under the Credit Agreement (other than
in respect of B Advances) in respect of (i) the Assignor's A Commitment and
the A Advances owing to the Assignor and/or (ii) the LC Commitment and
participations in Letter of Credit Liability of the Assignor. After giving
effect to such sale and assignment, (x) the Assignee's A Commitment and the
amount of the A Advances owing to the Assignee and (y) such Assignee's
LC Commitment and participations in Letter of Credit Liability will be as set
forth, respectively, in Section 2 of Schedule 1.
2. The Assignor (i) represents and warrants that it is the
legal and beneficial owner of the interests being assigned by it hereunder and
that such interests are free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto and (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any LC Subsidiary or the performance or
observance by the Borrower or any LC Subsidiary of any of their respective
obligations under the Credit Agreement or any other instrument or document
furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 6.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Issuing Bank, the Assignor or any other
Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking
or not taking action under the Credit Agreement; (iii) confirms that it is an
Eligible Assignee; (iv) appoints and authorizes the Agent and Issuing Bank to
take such action on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent and Issuing Bank by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees
that it will perform in accordance with their terms all of the obligations
which by the terms of the Credit Agreement are required to be performed by it
as a Lender; [and] (vi) specifies as its Domestic Lending Office (and address
for notices) and Eurodollar Lending Office the offices set forth beneath its
name on the signature pages hereof and [(vii) attaches the forms prescribed by
the Internal Revenue Service of the United States certifying as to the
Assignee's status for purposes of determining exemption from United States
withholding taxes with respect to all payments to be made to the Assignee
under the Credit Agreement or such other documents as are necessary to
indicate that all such payments are subject to such rates at a rate reduced by
an applicable tax treaty].
4. Following the execution of this Assignment and Acceptance by
the Assignor and the Assignee, it will be delivered to the Agent for
acceptance and recording by the Agent. The effective date of this Assignment
and Acceptance shall be the date of acceptance thereof by the Agent, unless
otherwise specified on Schedule 1 hereto (the "Effective Date").
5. Upon such acceptance and recording by the Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and
after the Effective Date, the Agent shall make (and shall direct the Issuing
Bank to make) all payments under the Credit Agreement in respect of the
interests assigned hereby (including, without limitation, all payments of
principal, interest and commitment fees with respect thereto) to the Assignee.
The Assignor and Assignee shall make all appropriate adjustments in payments
under the Credit Agreement for periods prior to the Effective Date directly
between themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
and Acceptance to be executed by their respective officers thereunto duly
authorized, as of the date first above written, such execution being made on
Schedule 1 hereto.
Schedule 1
to
Assignment and Acceptance
Dated , 19
Section 1.
Percentage Interest in A Commitment and A Advances:
Percentage Interest in LC Commitment and participations in Letter of
Credit Liability:
Section 2.
Assignee's A Commitment: $
Assignee's LC Commitment
Aggregate outstanding principal amount of A Advances owing to Assignee: $
Aggregate outstanding amount of Assignee's
participations in Letter of Credit Liability: $
Section 3.
Effective Date : , 19
[NAME OF ASSIGNOR]
By:
Title:
[NAME OF ASSIGNEE]
By:
Title:
Domestic Lending Office (and
address for notices):
[Address]
Eurodollar Lending Office:
[Address]
Accepted this day
of , 19
CITICORP USA, INC., as Agent
By:
Title:
EXHIBIT E
FORM OF AUCTION BORROWING NOTE
U.S. $ ___________Dated: ____________, 19___
FOR VALUE RECEIVED, the undersigned, THE GAP, INC., a Delaware
corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
____________________ (the "Lender") for the account of its Applicable
Lending Office (as defined in the Credit Agreement referred to below), on
_________, 19___, the principal amount of _______________________ Dollars ($
________).
The Borrower promises to pay interest on the unpaid principal
amount hereof from the date hereof until such principal amount is paid in
full, at the interest rate and payable on the interest payment date or dates
provided below:
Interest Rate: _____% per annum (calculated on the basis of a year of
_____ days for the actual number of days elapsed).
[Insert variable calculation if applicable]
Interest Payment Date or Dates:
____________________________________________
Both principal and interest are payable in lawful money of the
United States of America to ___________________________ for the account of the
Lender at the office of ____________________________, at
___________________________________________, in same day funds, free and clear
of and without any deduction, with respect to the payee named above, subject
to Section 4.02 of the Credit Agreement referred to below, for any and all
present and future taxes, deductions, charges or withholdings, and all
liabilities with respect thereto.
This Promissory Note is one of the promissory notes referred to in
Section 2.03(f) of the Credit Agreement, dated as of July 1, 1997, among the
Borrower, the Lender and certain other banks parties thereto, Citibank, N.A.,
as Issuing Bank, and Citicorp USA Inc., as Agent for the Lender and such other
banks and the Issuing Bank (such Credit Agreement, as it may be amended,
restated or otherwise modified, being the "Credit Agreement"). The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events.
The Borrower hereby waives presentment, demand, protest and notice
of any kind. No failure to exercise, and no delay in exercising, any rights
hereunder on the part of the holder hereof shall operate as a waiver of such
rights.
This Promissory Note shall be governed by, and construed in
accordance with, the laws of the State of New York, United States, without
reference to principles of conflicts of laws.
THE GAP, INC.
By
Name:
Title: