Exhibit 4c(i)
REVOLVING CREDIT AGREEMENT
REVOLVING CREDIT AGREEMENT dated as of June 17, 1991,
among TANDY CORPORATION, a Delaware corporation ("Tandy"),
TANDY CREDIT CORPORATION, a Delaware corporation ("TCC" and
together with Tandy collectively the "Borrowers"), the Banks
listed on the signature pages hereof (the "Banks"), TEXAS
COMMERCE BANK, NATIONAL ASSOCIATION, a national banking
association, as Administrative Agent for the Banks (in such
capacity, the "Administrative Agent"), and TEXAS COMMERCE
BANK NATIONAL ASSOCIATION, as Funds Administrator for the
Banks (in such capacity, the "Funds Administrator").
ARTICLE I
CERTAIN DEFINED TERMS, ACCOUNTING TERMS AND CONSTRUCTION
SECTION 1.01 Certain Defined Terms. As used in this
Agreement, the following terms shall have the following
meanings:
"Account Debtor" shall mean any Person who is or who may
become obligated to TCC under, with respect to, or on account
of, an Account purchased by TCC.
"Accounts" shall mean any and all rights of Tandy, TCC
and the other Subsidiaries of Tandy to payment for goods and
services sold or leased, including any such right evidenced
by chattel paper, whether due or to become due, whether or
not it has been earned by performance, and whether now or
hereafter acquired or arising in the future, including
accounts receivable from Affiliates.
"Adjusted CD Rate" shall mean, with respect to any
Borrowing comprised of Certificate of Deposit Loans for any
Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next higher 1/8 of 1%) equal to the sum
of (a) a rate per annum equal to the product of (i) the Fixed
Certificate of Deposit Rate in effect for such Interest
Period and (ii) Statutory Reserves, plus (b) the Assessment
Rate. For purposes hereof, the term "Fixed Certificate of
Deposit Rate" shall mean the arithmetic average (rounded to
the nearest 1/8 of 1% or, if there is no nearest 1/8 of 1%,
the next higher 1/8 of 1%) of the prevailing rates per annum
bid on or about 10:00 a.m. (New York City time) to the Funds
Administrator on the first Business Day of the Interest
Period for the Certificate of Deposit Loan by three New York
City negotiable certificate of deposit dealers of recognized
standing selected by the Funds Administrator for the purchase
at face value of negotiable certificates of deposit of major
United States money center banks in an amount approximately
equal to the principal amount of such Certificate of Deposit
Loan and with a maturity comparable to such Interest Period.
"Administrative Agent" shall have the meaning assigned
such term in the introduction to this Agreement.
"Administrative Questionnaire" shall mean an
Administrative Questionnaire in the form of Exhibit 1.01-A
hereto, which each Bank shall complete and provide to the
Funds Administrator.
"Affiliate" shall mean any Person (including any member
of the immediate family of any such natural person) who
directly or indirectly beneficially owns or controls 5% or
more of the total voting power of shares of capital stock of
either Borrower having the right to vote for directors under
ordinary circumstances, any person controlling, controlled by
or under common control with any such person (within the
meaning of Rule 405 under the Securities Act of 1933) and any
director or executive officer of such person.
"Agency Fee" shall have the meaning assigned such term
in Section 2.06(c).
"Agent's Letter" shall have the meaning assigned such
term in Section 2.06(c).
"Agents" shall mean the Administrative Agent and the
Funds Administrator.
"Alternate Base Rate" shall mean, for any day, a
fluctuating rate per annum (rounded upwards to the next
highest 1/8 of 1% if not already an integral multiple of 1/8
of 1%) equal to the greatest of (a) the Prime Rate in effect
on such day (b) the Base CD Rate in effect on such day plus
1% and (c) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1%. "Prime Rate" shall mean as of a
particular date, the prime rate most recently announced by
TCB and thereafter entered in the minutes of TCB's Loan and
Discount Committee, automatically fluctuating upward and
downward with and at the time specified in each such
announcement without notice to either Borrower or any other
Person, which prime rate may not necessarily represent the
lowest or best rate actually charged to a customer. For
purposes of this Agreement any change in the Alternate Base
Rate due to a change in the Prime Rate shall be effective on
the date such change in the Prime Rate is announced. "Base
CD Rate" means the sum of (x) the product of (i) the
Three-Month Secondary CD Rate and (ii) the Statutory Reserves
and (y) the Assessment Rate. "Three-Month Secondary CD Rate"
means, for any day, the secondary market rate for three-month
certificates of deposit reported as being in effect on such
day (or, if such day is not a Business Day, the next
preceding Business Day) by the Board through the public
information telephone line of the Federal Reserve Bank of New
York (which rate will, under the current practices of the
Board, be published in Federal Reserve Statistical Release
H.15(519) during the week following such day), or, if such
rate shall not be so reported on such day or such next
preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major
money center banks in New York City received at approximately
9:00 a.m., Houston, Texas time, on such day ) or, if such day
shall not be Business Day, on the next preceding Business
Day) by the Funds Administrator from three New York City
negotiable certificate of deposit dealers of recognized
standing selected by the Funds Administrator. For purposes
of this Agreement any change in the Alternate Base Rate due
to a change in the Three-Month Secondary CD Rate shall be
effective on the effective date of such change in the
Three-Month Secondary CD Rate. "Federal Funds Effective
Rate" shall mean, for any day, an interest rate per annum
equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, 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 Funds Administrator from three Federal funds brokers of
recognized standing selected by it. For purposes of this
Agreement any change in the Alternate Base Rate due to a
change in the Federal Funds Effective Rate shall be effective
on the effective date of such change in the Federal Funds
Effective Rate. If for any reason the Funds Administrator
shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to
ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Funds Administrator
to obtain sufficient bids or publications in accordance with
the terms thereof, the Alternate Base Rate shall be the Prime
Rate until the circumstances giving rise to such inability no
longer exist.
"Alternate Base Rate Loan" shall mean any Loan with
respect to which a Borrower shall have selected an interest
rate based on the Alternate Base Rate in accordance with the
provisions of Article II.
"Assessment Rate" shall mean for any date the annual
rate (rounded upwards, if necessary, to the next higher 1/100
of 1%) most recently estimated by the Funds Administrator as
the then current net annual assessment rate that will be
employed for determining amounts payable by the Funds
Administrator to the Federal Deposit Insurance Corporation
(or any successor) for insurance by such Corporation (or such
successor) of time deposits made in dollars at the Funds
Administrator's domestic offices.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Bank and an Eligible Assignee,
and accepted by the Agents, in the form of Exhibit 1.01-B
hereto.
"Banks" shall have the meaning assigned such term in the
introduction to this Agreement.
"Base CD Rate" shall have the meaning assigned such term
in the definition of the term Base Rate.
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States.
"Borrowers" shall have the meaning assigned such term in
the introduction to this Agreement.
"Borrowing" shall mean a group of Tranche A Loans or
Tranche B Loans of a single Type made by the Banks on a
single date and as to which a single Interest Period is in
effect.
"Borrowing Base" shall mean an amount equal to 90% of
the aggregate principal amount of all Eligible Accounts
Receivable purchased by TCC pursuant to the Operating
Agreement and at the date of any determination owned by TCC.
"Borrowing Base Certificate" shall mean a certificate in
the form of Exhibit 1.01-C hereto, duly completed and
executed by the chief financial officer or the chief
accounting officer of TCC accompanied by an accounts
receivable aging schedule substantially in the form of
Exhibit 1.01-D hereto.
"Business Day" shall mean a day when the Agents and each
Bank are open for business, and if the applicable Business
Day relates to any Eurodollar Loan, a day on which dealings
are carried on in the London interbank market and commercial
banks are open for domestic or international business in
London, England, in New York City, New York and in Houston,
Texas.
"Capital Lease" shall mean any lease required to be
accounted for as a capital lease under generally accepted
accounting principles.
"Certificate of Deposit Loan" shall mean any Loan with
respect to which a Borrower shall have selected an interest
rate based on the Adjusted CD Rate in accordance with the
provisions of Article II.
"Change of Control" shall mean any of (i) the
acquisition by any Person or two or more Persons (excluding
underwriters in the course of their distribution of voting
stock in an underwritten public offering) acting in concert,
of beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission) of 25% or more of the
outstanding shares of voting stock of Tandy, (ii) a majority
of the members of the Board of Directors of Tandy on any date
shall not have been (x) members of the Board of Directors of
Tandy on the date 12 months prior to such date or (y)
approved by Persons who constitute at least a majority of the
members of the Board of Directors of Tandy as constituted on
the date 12 months prior to such date, (iii) all or
substantially all of the assets of Tandy are sold in a single
transaction or series or related transactions to any Person
or (iv) Tandy merges or consolidates with or into any other
Person, with the effect that immediately after such
transaction the stockholders of Tandy immediately prior to
such transaction hold less than 100% of the total voting
power entitled to vote in the election of directors, managers
or trustees of the Person surviving such transaction.
"Closing Date" shall mean the date of the first
Borrowing under this Agreement.
"Closing Fee" shall have the meaning assigned such term
in Section 2.06(b).
"Code" shall mean the Internal Revenue Code of 1986 and
any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time
to time. References to sections of the Code shall be
construed to also refer to any successor sections.
"Commitment Fees" shall mean, with respect to each Bank,
such Bank's Tranche A Commitment Fees and the Tranche B
Commitment Fees.
"Commitments" shall mean, with respect to each Bank,
such Bank's Tranche A Commitment and Tranche B Commitment.
"Communications" has the meaning assigned such term in
Section 9.01.
"Confidential Information Memorandum" shall mean the
Confidential Information Memorandum dated May 1991 prepared
by Chemical Banking Corporation relating to the revolving
credit facilities evidenced by this Agreement.
"Consolidated Senior Indebtedness" shall mean with
respect to Tandy, all Indebtedness of Tandy and its
Subsidiaries, other than Subordinated Indebtedness,
calculated on a consolidated basis.
"Consolidated Tangible Net Worth" shall mean, with
respect to Tandy, at any time, the total Stockholders Equity
less the total amount of any intangible assets and plus the
total amount of any Subordinated Indebtedness unless already
included in Stockholders' Equity, with all such amounts being
calculated for Tandy and its consolidated Subsidiaries on a
consolidated basis in accordance with generally accepted
accounting principles applied on a consistent basis.
Intangible assets shall include unamortized debt discount and
expense, unamortized deferred charges and goodwill.
"Default" shall mean any event or condition which, with
the lapse of time or giving of notice or both, would
constitute an Event of Default.
"Eligible Accounts Receivable" shall mean at the time of
any determination thereof all Accounts (net of all allowances
and reserves for doubtful or uncollectible accounts and
exclusive of Accounts arising from transactions between
either Borrower or any Affiliate) which met the following
criteria for an eligible account at the time of creation and
continue to meet the same at the time of such determination:
(i) all payments on the Account are due not more than 30 days
after the date of the invoice rendered by TCC; (ii) any
required payment on the Account is not past due more than 60
days (determined with reference to the date which the invoice
rendered to the Account Debtor indicated to be the date on
which such payment with respect to the Account is due or, if
no such date is specified in such invoice, the date of such
invoice); (iii) the Account arose from an outright and lawful
sale of goods by or on behalf of a Borrower or one of its
Affiliates; (iv) the Account is owned by TCC free and clear
of all security interests, liens, charges and encumbrances of
any nature whatsoever other than any security interest deemed
to be held by TCC; (v) the Account constitutes "accounts" or
"chattel paper" within the meaning of the Uniform Commercial
Code of the state (other than Louisiana) where the Account is
located; (vi) the Account is not subject to any setoff,
net-out contract, counterclaim or other defense arising out
of the transactions represented by the Accounts or
independently thereof and the Account Debtor has not
complained as to his liability thereon or returned any of the
goods from the sale out of which the Account arose, except
complaints made or goods returned in the ordinary course of
business for which, in the case of goods returned, goods of
equal or greater value have been shipped in return; (vii) the
Account arose in the ordinary course of business of a
Borrower or one of its Affiliates and no notice of death,
bankruptcy or insolvency of the Account Debtor has been
received; (viii) the Account complies with the requirements
of all applicable laws and regulations, whether federal,
state or local (including usury laws and laws, rules and
regulations relating to truth in lending, fair credit
billing, fair credit reporting, equal credit opportunity,
fair debt collection practices and privacy); (ix) the Account
is in full force and effect and constitutes a legal, valid
and binding obligation of the Account Debtor enforceable in
accordance with its terms; (x) the Account is denominated in
and provides for payment by the Account Debtor in United
States dollars; (xi) the Account has not been charged-off or
written-off as uncollectible in accordance with the customary
business practice of a Borrower and (xii) the Account neither
has been transferred to TRC or to the Tandy Master Trust nor
is subject to any pooling or servicing agreement.
"Eligible Assignee" shall mean (i) any Bank or any
Affiliate of any Bank; (ii) a commercial bank organized under
the laws of the United States, or any state thereof, and
having total assets in excess of $1,000,000,000 and having
deposits that rated in either of the two highest generic
letter rating categories (without regard to subcategories)
from either Standard & Poor's Corporation or Moody's
Investors Service, Inc.; (iii) a commercial bank organized
under the laws of any other country which is a member of the
OECD, or a political subdivision of any such country, and
having total assets in excess of $1,000,000,000, provided
that such bank is acting through a branch or agency located
in the country in which it is organized or another country
which is also a member of the OECD; (iv) the central bank of
any country which is a member of the OECD; and (v) any other
financial institution approved by the Borrowers, the
Administrative Agent and the Funds Administrator.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, and any successor statute of similar
import, together with the regulations thereunder, in each
case as in effect from time to time. References to sections
of ERISA shall be construed to also refer to any successor
sections.
"ERISA Affiliate" shall mean any corporation, trade or
business that is, along with Tandy, a member of a controlled
group of corporations or a controlled group of trades or
businesses, as described in sections 414(b) and 414(c),
respectively, of the Code or section 4001 of ERISA.
"Eurodollar Loan" shall mean any Loan with respect to
which a Borrower shall have selected an interest rate based
on the LIBO Rate in accordance with the provisions of Article
II.
"Event of Default" shall have the meaning assigned such
term in Article VII.
"Execution Date" shall mean the earliest date upon which
all of the following shall have occurred: (i) counterparts of
this Agreement shall have been executed by the Borrowers,
each Bank, the Administrative Agent and the Funds
Administrator and when the Administrative Agent shall have
received counterparts hereof which taken together, bear the
signature of each Bank and the Funds Administrator, (ii) the
Revolving Credit Agreement dated as of June 18, 1987 among
TCC, the banks party thereto and Chemical Bank, as agent for
such banks, as amended pursuant to a First Amendment to
Revolving Credit Agreement dated as of June 18, 1989 and a
Second Amendment to Revolving Credit Agreement dated as of
April 1, 1991 shall have been terminated, and (iii) the
Credit Agreement dated as of May 1, 1989 between Tandy, the
banks party thereto and Continental Bank, N.A. as agent for
such banks, as modified by a Waiver to Credit Agreement dated
as of April 1, 1991 shall have been terminated.
"Federal Funds Effective Rate" shall have the meaning
assigned such term in the definition of "Alternate Base
Rate."
"Fixed Certificate of Deposit Rate" shall have the
meaning assigned such term in the definition of "Adjusted CD
Rate."
"Funds Administrator" shall have the meaning assigned
such term in the introduction to this Agreement.
"Guaranties" by any Person shall mean all obligations
(other than endorsements in the ordinary course of business
of negotiable instruments for deposit or collection) of such
Person guaranteeing or, in effect, guaranteeing any
Indebtedness, dividend or other obligation, of any other
Person (the "primary obligor") in any manner, whether
directly or indirectly, including all obligations incurred
through an agreement, contingent or otherwise, by such
Person:
(a) to purchase such Indebtedness or obligation or
any property or assets constituting security therefor,
(b) to advance or supply funds (i) for the
purchase or payment of such Indebtedness or obligation,
(ii) to maintain working capital or other balance sheet
condition or otherwise to advance or make available
funds for the purchase or payment of such Indebtedness
or obligation,
(c) to lease property or to purchase securities or
other property or services primarily for the purpose of
assuring the owner of such Indebtedness or obligation of
the ability of the primary obligor to make payment of
the Indebtedness or obligation, or
(d) otherwise to assure the owner of the
Indebtedness or obligation of the primary obligor
against loss in respect thereof.
For the purposes of all computations made under this
Agreement, a Guaranty in respect of any Indebtedness for
borrowed money shall be deemed to be Indebtedness equal to
the principal amount of such Indebtedness for borrowed money
which has been guaranteed, and a Guaranty in respect of any
other obligation or liability or any dividend shall be deemed
to be Indebtedness equal to the maximum aggregate amount of
such obligation, liability or dividend.
"Highest Lawful Rate" shall mean, as to any Bank, at the
particular time in question, the maximum nonusurious rate of
interest which, under applicable law, such Bank is then
permitted to charge the Borrowers on the Loans. If the
maximum rate of interest which, under applicable law, the
Banks are permitted to charge the Borrowers on the Loans
shall change after the date hereof, the Highest Lawful Rate
shall be automatically increased or decreased, as the case
may be, as of the effective time of such change without
notice to the Borrowers.
"HLT Classification" shall have the meaning assigned
such term in Section 2.19.
"Indebtedness" of any Person shall mean, without
duplication:
(a) any obligation of such Person for borrowed
money, including:
(i) any obligation of such Person evidenced
by bonds, debentures, notes or other similar debt
instruments, and
(ii) any obligation for borrowed money which
is non-recourse to the credit of such Person but
which is secured by any asset of such Person,
(b) any obligation of such Person on account of
deposits or advances,
(c) all obligations of such Person under
conditional sale or other title retention agreements
relating to property purchased by such Person,
(d) any obligation of such Person for the deferred
purchase price of any property or services, except
accounts payable arising in the ordinary course of such
Person's business,
(e) rentals in respect of Capital Leases of such
Person, provided, however, except with respect to TCC,
rentals of any such Person shall not constitute
Indebtedness unless such rentals are in excess in the
aggregate of $30,000,000 at any one time outstanding,
(f) Guaranties by such Person to the extent
required pursuant to the definition thereof,
(g) any Indebtedness of another Person secured by
a Lien on any asset of such first Person, whether or not
such Indebtedness is assumed by such first Person, and
(h) any Indirect Indebtedness of such Person.
"Indemnitee" shall have the meaning assigned such term
in Section 9.04.
"Indirect Indebtedness" of a Person shall mean (a) the
Indebtedness of a partnership in which such Person is a
general partner, and (b) the amount of any liability of such
Person created by the Indebtedness of a joint venture in
which such Person is a joint venturer.
"Insignificant Foreign Subsidiary" shall mean a
Subsidiary of Tandy which is not organized under the laws of
a state of the United States and which is not a Significant
Subsidiary of Tandy.
"Interest Payment Date" shall mean, as to any Loan, the
last day of the Interest Period applicable to such Loan (and,
in addition, in the case of any Interest Period of six months
or 180 days duration, the day that would have been the
Interest Payment Date of such Interest Period if such
Interest Period had been of three months or 90 days
duration).
"Interest Period" shall mean: (i) as to any Eurodollar
Loan, the period commencing on the date of such Eurodollar
Loan and ending on the numerically corresponding day (or, if
there is no numerically corresponding day, on the last day)
in the calendar month that is 1, 2, 3 or 6 months thereafter,
as a Borrower may elect, (ii) as to any Certificate of
Deposit Loan, a period of 30, 60, 90 or 180 days duration, as
a Borrower may elect, commencing on the date of such
Certificate of Deposit Loan and (iii) as to any Alternate
Base Rate Loan, a period of 90 days duration, commencing on
the date of such Loan; provided, however, that (i) if any
Interest Period would end on a day that shall not be a
Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless, with respect to
Eurodollar Loans only, such next succeeding Business Day
would fall in the next calendar month, in which case such
Interest Period shall end on the next preceding Business Day,
(ii) no Interest Period with respect to any Tranche A Loan
shall end later than the Tranche A Maturity Date, (iii) no
Interest Period with respect to any Tranche B Loan shall end
later than the Tranche B Maturity Date and (iv) interest
shall accrue from and including the first day of an Interest
Period to but excluding the last day of such Interest Period.
"Investment" shall mean any investment, made by a Person
in any other Person in cash or by delivery of any kind of
property or asset, whether by acquisition of shares of stock
or similar interest, Indebtedness or other obligation or
security, or by loan, advance or capital contribution, or
otherwise.
"LIBO Rate" shall mean the rate (rounded to the nearest
1/8 of 1% or, if there is no nearest 1/8 of 1%, the next
higher 1/8 of 1%) at which dollar deposits approximately
equal in principal amount to the Administrative Agent's
portion of such Borrowing and for a maturity equal to the
applicable Interest Period are offered in immediately
available funds to the principal office of the Funds
Administrator in London, England (or if the Funds
Administrator does not at the time any such determination is
made, maintain an office in London, England, the principal
office of any Affiliate of the Funds Administrator in London,
England) by leading banks in the London Interbank Market for
Eurodollars at approximately 11:00 a.m., London time, two
Business Days prior to the commencement of such Interest
Period.
"Lien" shall mean any mortgage, pledge, hypothecation,
judgment lien or similar legal process, title retention lien,
or other lien or security interest, including the interest of
a vendor under any conditional sale or other title retention
agreement and the interest of a lessor under any Capital
Lease.
"Loan" shall mean a Tranche A Loan, a Tranche B Loan, an
Alternate Base Rate Loan, a Certificate of Deposit Loan or a
Eurodollar Loan.
"Loan Documents" means this Agreement, the Notes, the
Agent's Letter, the Operating Agreement, the Support
Agreement and all other documents, instruments executed by a
Borrower or any other Person in connection with this
Agreement and the Loans including the Tandy Guaranty, if
executed and delivered pursuant to Section 7.01(d).
"Margin Stock" shall have the meaning assigned such term
in Regulation U.
"Maximum Permissible Rate" shall have the meaning
assigned such term in Section 9.08.
"Note" or "Notes" shall mean the Tranche A Notes and the
Tranche B Notes or any one thereof.
"Notice of Borrowing" shall have the meaning assigned
such term in Section 2.02(c).
"OECD" shall mean the Organization for Economic
Cooperation and Development.
"Operating Agreement" shall mean the Operating
Agreement, dated as of June 18, 1987, by and between Tandy
and TCC.
"Other Activities" shall have the meaning assigned such
term in Section 8.03.
"Other Financings" shall have the meaning assigned such
term in Section 8.03.
"Other Taxes" shall have the meaning assigned such term
in Section 2.18.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation and any entity succeeding to any or all of its
functions under ERISA.
"Permitted Indebtedness" shall mean with respect to TCC
(i) the Loans, Short-term Indebtedness and commercial paper
borrowings in an aggregate principal amount not in excess of
$400,000,000 and (ii) unsecured Indebtedness (other than
Short-term Indebtedness) and intercompany indebtedness due to
Tandy.
"Person" shall mean any natural person, corporation,
business trust, association, company, joint venture,
partnership or government or any agency or political
subdivision thereof.
"Plan" shall mean a pension plan, as such term is
defined in ERISA, established or maintained by Tandy or any
ERISA Affiliate or as to which Tandy or any ERISA Affiliate
contributes or is a member or otherwise may have any
liability.
"Prime Rate" shall have the meaning assigned such term
in the definition of the term Alternate Base Rate.
"Process Agent" shall have the meaning assigned such
term in Section 9.13.
"Register" shall have the meaning assigned such term in
Section 9.03(d).
"Regulation G" shall mean Regulation G of the Board, as
the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof.
"Regulation T" shall mean Regulation T of the Board, as
the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof.
"Regulation U" shall mean Regulation U of the Board, as
the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof.
"Regulation X" shall mean Regulation X of the Board, as
the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof.
"Reportable Event" shall mean a Reportable Event as
defined in Section 4043(b) of ERISA.
"Required Banks" shall mean at any time Banks holding
66-2/3% of the aggregate principal amount of the Loans at the
time outstanding, or if no Loans are outstanding, Banks
having 66-2/3% of the Total Commitment.
"Short-term Indebtedness" shall mean, at any date,
Indebtedness which matures one year or less from such date
and which is not directly or indirectly renewable or
extendible, at the option of the obligor, by its terms or the
terms of any instrument or agreement relating thereto, to a
date more than one year from such date.
"Significant Subsidiary" shall mean as to either
Borrower or any Subsidiary of such Borrower which either (i)
has a net worth in excess of 5% of the consolidated net worth
of such Borrower and its other Subsidiaries, or (ii) has
gross revenues in excess of 5% of the consolidated gross
revenues of such Borrower and its other Subsidiaries based,
in each case, on the most recent audited financial statements
of such Borrower. In all events the Significant Subsidiaries
of Tandy shall include O Sullivan Industries Incorporated, a
Delaware corporation, GRID Systems Corporation, a California
corporation, TCC and TRC, and the Significant Subsidiaries of
TCC shall include TRC.
"Statutory Reserves" shall mean a fraction (expressed as
a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of
the maximum reserve percentages (including any marginal,
special, emergency, or supplemental reserves) expressed as a
decimal established by the Board and any other banking
authority to which any Bank is subject for new negotiable
time deposits in dollars of over $100,000 with maturities
approximately equal to (a) the applicable Interest Period, in
the case of the Adjusted CD Rate, and (b) three months, with
respect to the Base CD Rate. Statutory Reserves shall be
adjusted automatically on and as of the effective date of any
change in any reserve percentage.
"Stockholders Equity" shall mean in respect of either
Borrower at any date the sum of (a) its capital stock taken
at par value, (b) its capital surplus and (c) its retained
earnings less treasury stock, all computed in accordance with
generally accepted accounting principles applied on a
consistent basis.
"Subordinated Indebtedness" shall mean with respect to
either Borrower, Indebtedness of such Borrower having
maturities and terms, and which is subordinated to payment of
the Notes of such Borrower in a manner, approved in writing
by the Administrative Agent and the Required Banks.
"Subsidiary" shall mean any Person of which or in which
any other Person (the "parent") and the other Subsidiaries of
the parent own directly or indirectly 50% or more of:
(a) the combined voting power of all classes of\
stock having general voting power under ordinary
circumstances to elect a majority of the board of
directors of such Person, if it is a corporation;
(b) the capital interest or profits interest of
such Person, if it is a partnership, joint venture or
similar entity; or
(c) the beneficial interest of such Person, if it
is a trust, association or other unincorporated
organization.
"Support Agreement" shall mean the Amended and Restated
Support Agreement, dated as of the date hereof, by and
between Tandy and TCC substantially in the form of Exhibit
1.01-E hereto.
"Tandy" shall have the meaning assigned such term in the
introduction to this Agreement.
"Tandy Guaranty" shall have the meaning specified in
Section 7.01(d).
"Taxes" shall have the meaning assigned such term in
Section 2.18.
"TCB" shall mean Texas Commerce Bank National
Association.
"TCB-Dallas" shall mean Texas Commerce Bank, National
Association.
"TCC" shall have the meaning assigned such term in the
introduction to this Agreement.
"Three-Month Secondary CD Rate" shall have the meaning
assigned such term in the definition of "Alternate Base
Rate."
"Total Commitment" shall mean at any time the aggregate
amount of the Banks' Commitments, as in effect at such time.
"Total Tranche A Commitment" shall mean, at any time,
the sum of the Tranche A Commitments of each of the Banks.
"Total Tranche B Commitment" shall mean, at any time,
the sum of the Tranche B Commitments of each of the Banks.
"Tranche" shall mean each tranche of Loans determined
with reference to the type of Commitments utilized in making
same, i.e., Tranche A Loans or Tranche B Loans.
"Tranche A Borrowing" shall mean a Borrowing consisting
of simultaneous Tranche A Loans from each of the Banks.
"Tranche A Commitment" shall mean, with respect to each
Bank, the amount set forth opposite such Bank's name on the
signature page hereof directly below the column entitled
"Tranche A Commitment," as the same may be reduced from time
to time pursuant to Section 2.07.
"Tranche A Commitment Fee" shall have the meaning
provided in Section 2.06(a).
"Tranche A Loan" shall have the meaning assigned such
term in Section 2.01(a).
"Tranche A Maturity Date" shall mean June 12, 1992.
"Tranche A Note" shall have the meaning assigned such
term in Section 2.04(a).
"Tranche B Borrowing" shall mean a Borrowing consisting
of simultaneous Tranche B Loans from each of the Banks.
"Tranche B Commitment" shall mean, with respect to each
Bank, the amount set forth opposite such Bank's name on the
signature page hereof below the column entitled "Tranche B
Commitment," as the same may be reduced from time to time
pursuant to Section 2.07.
"Tranche B Commitment Fee" shall have the meaning
assigned such term in Section 2.06(b).
"Tranche B Loan" shall have the meaning assigned such
term in Section 2.01(b).
"Tranche B Maturity Date" shall mean June 12, 1994.
"Tranche B Note" shall have the meaning assigned such
term in Section 2.04(a).
"Transferee" shall have the meaning assigned such term
in Section 2.18.
"TRC" shall mean Tandy Receivables Corporation, a
Delaware corporation.
"Type" shall mean any type of Loan determined with
respect to the interest option applicable thereto, i.e., a
Eurodollar Loan, a Certificate of Deposit Loan or an
Alternate Base Rate Loan.
"Wholly-owned Subsidiary" shall mean any Person of which
Tandy or its other Wholly-owned Subsidiaries own directly or
indirectly 100% of:
(a) the issued and outstanding shares of stock
(except shares required as directors' qualifying shares
and shares constituting less than 2% of the issued and
outstanding shares) and all Indebtedness for borrowed
money;
(b) the capital interest or profits interest of
such Person, if it is a partnership, joint venture or
similar entity; or
(c) the beneficial interest of such Person, if it
is a trust, association or other unincorporated
organization.
SECTION 1.02. Accounting Terms. Except as otherwise
herein specifically provided, each accounting term used
herein shall have the meaning given it under generally
accepted accounting principles in effect from time to time
applied on a consistent basis; provided, however, that each
reference in Article VI and in the definition of any term
used in Article VI to generally accepted accounting
principles shall mean generally accepted accounting
principles in effect on the date hereof.
SECTION 1.03. Interpretation. (a) In this Agreement,
unless a clear contrary intention appears:
(i) the singular number includes the plural number
and vice versa;
(ii) reference to any gender includes each other
gender;
(iii) the words "herein," "hereof" and "hereunder"
and other words of similar import refer to this
Agreement as a whole and not to any particular Article,
Section or other subdivision;
(iv) reference to any Person includes such
Person's successors and assigns but, if applicable,
only if such successors and assigns are permitted by
this Agreement, and reference to a Person in a
particular capacity excludes such Person in any other
capacity or individually, provided that nothing in this
clause (iv) is intended to authorize any assignment not
otherwise permitted by this Agreement;
(v) reference to any agreement, document or
instrument means such agreement, document or instrument
as amended, supplemented or modified and in effect from
time to time in accordance with the terms thereof and,
if applicable, the terms hereof, and reference to any
Note includes any note issued pursuant hereto in
extension or renewal thereof and in substitution or
replacement therefor;
(vi) unless the context indicates otherwise,
reference to any Article, Section, Schedule or Exhibit
means such Article or Section hereof or such Schedule or
Exhibit hereto;
(vii) the words "including" (and with correlative
meaning "include") means including, without limiting the
generality of any description preceding such term;
(viii) with respect to the determination of any
period of time, the word "from" means "from and
including" and the word "to" means "to but excluding;"
and
(ix) reference to any law means such as amended,
modified, codified or reenacted, in whole or in part,
and in effect from time to time.
(b) The Article and Section headings herein and
the Table of Contents are for convenience only and shall not
affect the construction hereof.
(c) No provision of this Agreement shall be
interpreted or construed against any Person solely because
that Person or its legal representative drafted such
provision.
ARTICLE II
THE LOANS
SECTION 2.01. Commitments. (a) Subject to the terms
and conditions and relying upon the representations and
warranties herein set forth, each Bank, severally and not
jointly, agrees to make revolving credit loans (each a
"Tranche A Loan") to the Borrowers at any time and from time
to time on and after the date hereof and until the earlier of
the Tranche A Maturity Date and the termination of the
Tranche A Commitment of such Bank in accordance with the
terms hereof. Notwithstanding the foregoing, (i) the
aggregate principal amount of all Tranche A Loans of a Bank
at any time outstanding shall not exceed such Bank's Tranche
A Commitment, (ii) the aggregate principal amount of all
Tranche A Loans made by all Banks at any time outstanding
shall not exceed the Total Tranche A Commitment of all Banks,
(iii) the sum of the aggregate principal amount of all
Tranche A Loans plus the aggregate principal amount of all
Tranche B Loans made by all Banks at any time outstanding
shall not exceed the Total Commitment and (iv) the sum of the
aggregate principal amount of all Tranche A Loans plus all
Tranche B Loans made by all Banks to TCC at any time
outstanding shall not exceed the Borrowing Base. Within the
foregoing limits, the Borrowers may borrow, repay, prepay and
reborrow Tranche A Loans hereunder on and after the date
hereof and prior to the Tranche A Maturity Date.
(b) Subject to the terms and conditions and
relying upon the representations and warranties herein set
forth, each Bank, severally and not jointly, agrees to make
revolving credit loans (each a "Tranche B Loan") to the
Borrowers at any time and from time to time on and after the
date hereof and until the earlier of the Tranche B Maturity
Date and the termination of the Tranche B Commitment of such
Bank in accordance with the terms hereof. Notwithstanding
the foregoing, (i) the aggregate principal amount of all
Tranche B Loans of a Bank at any time outstanding shall not
exceed such Bank's Tranche B Commitment, (ii) the aggregate
principal amount of all Tranche B Loans made by all Banks at
any time outstanding shall not exceed the Total Tranche B
Commitment of all Banks, (iii) the sum of the aggregate
principal amount of all Tranche B Loans plus the aggregate
principal amount of all Tranche A Loans made by all Banks at
any time outstanding shall not exceed the Total Commitment
and (iv) the sum of the aggregate principal amount of all
Tranche B Loans plus all Tranche A Loans made by all Banks to
TCC at any time outstanding shall not exceed the Borrowing
Base. Within the foregoing limits, the Borrowers may borrow,
repay, prepay and reborrow Tranche B Loans hereunder; on and
after the date hereof and prior to the Tranche B Maturity
Date.
SECTION 2.02. Loans. (a) Each Borrowing made by the
Banks to a Borrower on any one date shall be in a minimum
aggregate principal amount of $5,000,000 and an integral
multiple of $1,000,000, and shall consist of Loans of the
same Tranche made ratably by the Banks in accordance with
their respective Commitments; provided, however, that the
failure of any Bank to make any Loan shall not relieve any
other Bank of its obligation to lend hereunder. The first
Loan by each Bank to a Borrower shall be made against
delivery to such Bank of an appropriate Note, payable to the
order of such Bank, executed by such Borrower, as referred to
in Section 2.04.
(b) Each Borrowing shall be a Tranche A Borrowing
or a Tranche B Borrowing and comprised of Alternate Base Rate
Loans, Certificate of Deposit Loans or Eurodollar Loans as a
Borrower may request pursuant to Section 2.03. Each Bank may
fulfill its Commitment with respect to any Eurodollar Loan or
Certificate of Deposit Loan by causing, at its option, any
domestic or foreign branch or Affiliate of such Bank to make
such Loan, provided that the exercise of such option shall
not affect the obligation of such Borrower, to repay such
Loan in accordance with the terms of the applicable Note.
Subject to the provisions of Section 2.03 and Section 2.10,
Borrowings of more than one Type may be outstanding at the
same time.
(c) Subject to Section 2.15, each Bank shall make
its portion, as determined under Section 2.15, of each
Borrowing to a Borrower hereunder on the proposed date
thereof by paying the amount required to the Funds
Administrator in Houston, Texas in immediately available
funds not later than 1:00 p.m., Houston, Texas time, and,
subject to satisfaction of the conditions set forth in
Article IV, the Funds Administrator shall promptly and in any
event on the same day, credit the amounts so received to the
general deposit account of such Borrower with the Funds
Administrator, or, if a Borrowing shall not occur on such
date because any condition precedent herein specified shall
not have been met, return the amounts so received to the
respective Banks. Loans of each Tranche shall be made by the
Banks pro rata in accordance with Section 2.14. Unless the
Funds Administrator shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not
make available to the Funds Administrator such Bank's portion
of such Borrowing, the Funds Administrator may assume that
such Bank has made such portion available to the Funds
Administrator on the date of such Borrowing in accordance
with this paragraph (c) and the Funds Administrator may, in
reliance upon such assumption, make available to the relevant
Borrower on such date a corresponding amount. If and to the
extent that such Bank shall not have made such portion
available to the Funds Administrator, such Bank and such
Borrower severally agree to repay to the Funds Administrator
forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is
made available to such Borrower until the date such amount is
repaid to the Funds Administrator at (i) in the case of such
Borrower, the interest rate applicable at the time to the
Loans comprising such Borrowing and (ii) in the case of such
Bank, the Federal Funds Effective Rate. If such Bank shall
repay to the Funds Administrator such corresponding amount,
such amount shall constitute such Bank's Loan as part of such
Borrowing for purposes of this Agreement.
SECTION 2.03. Notice of Borrowings. (a) In order to
effect a Borrowing, a Borrower shall give irrevocable written
or telex notice (or irrevocable telephone notice thereof,
confirmed as soon as practicable by written notice) to the
Funds Administrator (a "Notice of Borrowing") (i) in the case
of an Alternate Base Rate Loan, not later than 11:00 a.m.,
Houston, Texas time, on the day of a proposed Borrowing, (ii)
in the case of a Certificate of Deposit Loan, not later than
10:00 a.m., Houston, Texas time, two Business Days before a
proposed Borrowing, and (iii) in the case of a Eurodollar
Loan, not later than 10:00 a.m., Houston, Texas time, three
Business Days before a proposed Borrowing. Each Notice of
Borrowing shall be irrevocable and shall in each case refer
to this Agreement and specify (i) the name of the Borrower,
(ii) whether the Borrowing then being requested is a Tranche
A Borrowing or a Tranche B Borrowing, (iii) whether the
Borrowing then being requested is to be comprised of
Alternate Base Rate Loans, Certificate of Deposit Loans or
Eurodollar Loans, (iv) the date of such Borrowing (which
shall be a Business Day) and amount thereof (which, in the
case of a Borrowing to be comprised of Alternate Base Rate
Loans, shall not be less than $5,000,000 and shall be in an
integral multiple of $1,000,000, and which, in the case of a
Borrowing to be comprised of Certificate of Deposit Loans or
Eurodollar Loans, shall not be less than $25,000,000 and
shall be in an integral multiple of $5,000,000) and (v) if
such Borrowing is to be comprised of Certificate of Deposit
Loans or Eurodollar Loans, the Interest Period or Interest
Periods with respect thereto. If no election as to the Type
of Loan is specified in any such notice by a Borrower, such
Loan shall be an Alternate Base Rate Loan. If no Interest
Period with respect to any Borrowing comprised of Certificate
of Deposit Loans or Eurodollar Loans is specified in any such
notice by a Borrower, then in the case of a Borrowing
comprised of Certificate of Deposit Loans, a Borrower shall
be deemed to have selected an Interest Period of 30 days
duration and in the case of a Borrowing comprised of
Eurodollar Loans, a Borrower shall be deemed to have selected
an Interest Period of one month's duration. The Funds
Administrator shall promptly advise the Administrative Agent
and the Banks of any notice given by a Borrower pursuant to
this Section 2.03(a) and of each Bank's portion of the
requested Borrowing.
(b) Notwithstanding any provision to the contrary
in this Agreement, with respect to either Tranche, more than
one Borrowing may occur on the same date. For purposes of
the foregoing, Borrowings comprised of Loans having different
Interest Periods, regardless of whether they commence on the
same date, shall be considered separate Borrowings. Each
Borrowing shall be comprised of Loans of the same Tranche.
SECTION 2.04. Notes; Repayment of Loans. (a) The
Tranche A Loans made by each Bank to a Borrower shall be
evidenced by a note (a "Tranche A Note") duly executed on
behalf of such Borrower, dated the Closing Date, in
substantially the form attached hereto as Exhibit 2.04-A,
payable to such Bank in a principal amount equal to its
Tranche A Commitment on such date. The Tranche B Loans made
by each Bank to a Borrower shall be evidenced by a note (a
"Tranche B Note") duly executed on behalf of such Borrower,
dated the Closing Date, in substantially the form attached
hereto as Exhibit 2.04-B, payable to such Bank in a principal
amount equal to its Tranche B Commitment on such date. The
outstanding principal balance of each Tranche A Loan and
Tranche B Loan, as evidenced by the relevant Note, shall be
payable on the last day of the Interest Period applicable to
such Loan or, if earlier, the Tranche A Maturity Date or the
Tranche B Maturity Date, as applicable. Each Note shall bear
interest from its date on the outstanding principal balance
thereof as provided in Section 2.05.
(b) Each Bank, the Administrative Agent or the
Funds Administrator on its behalf, shall, and is hereby
authorized by each Borrower to, endorse on the schedule
attached to the relevant Notes delivered to such Bank (or a
continuation of such schedule attached to such Notes and made
a part thereof), or otherwise record in such Bank's internal
records, an appropriate notation evidencing the date and
amount of each Tranche A Loan or Tranche B Loan, as
applicable from the Bank to a Borrower, as well as the date
and amount of each payment and prepayment with respect
thereto; provided, however, that the failure of any Bank, the
Administrative Agent or the Funds Administrator to make such
a notation or any error in such a notation shall not affect
the obligation of a Borrower hereunder or under the Notes of
such Bank to repay the principal amount of the Loans made by
such Bank thereunder to such Bank together with all interest
accruing thereon.
SECTION 2.05. Interest on Loans. (a) Subject to the
provisions of Section 2.08, each Alternate Base Rate Loan
shall bear interest at a rate per annum, equal to the lesser
of (i) the Highest Lawful Rate and (ii) the Alternate Base
Rate (if the Alternate Base Rate is based on the Prime Rate,
computed on the basis of the actual number of days elapsed
over a year of 365 or 366 days, as the case may be; if the
Alternate Base Rate is based on the Base CD Rate or the
Federal Funds Effective Rate, computed on the basis of the
actual number of days elapsed over a year of 360 days).
Interest on each Alternate Base Rate Loan shall be payable on
each applicable Interest Payment Date.
(b) Subject to the provisions of Section 2.08,
each Certificate of Deposit Loan shall bear interest at a
rate per annum (computed on the basis of the actual number of
days elapsed over a year of 360 days) equal to the lesser of
(i) the Highest Lawful Rate and (ii) the Adjusted CD Rate for
the Interest Period in effect for such Loan plus 1/2 of 1%.
Interest on each Certificate of Deposit Loan shall be payable
on each applicable Interest Payment Date. The applicable
Adjusted CD Rate shall be determined by the Funds
Administrator, and such determination shall be conclusive
absent demonstrable error. The Funds Administrator shall
promptly advise the Borrowers and each Bank of such
determination.
(c) Subject to the provisions of Section 2.08,
each Eurodollar Loan shall bear interest at a rate per annum
(computed on the basis of the actual number of days elapsed
over a year of 360 days) equal to the lesser of (i) the
Highest Lawful Rate and (ii) the LIBO Rate for the Interest
Period in effect for such Loan plus 3/8 of 1%. Interest on
each Eurodollar Loan shall be payable on each applicable
Interest Payment Date. The LIBO Rate shall be determined by
the Funds Administrator, and such determination shall be
conclusive absent demonstrable error. The Funds
Administrator shall promptly advise the Borrowers and each
Bank of such determination.
SECTION 2.06. Fees. (a) Tandy shall pay each Bank,
through the Funds Administrator, on the last day of each
March, June, September and December, and on the Tranche A
Maturity Date, in immediately available funds, a commitment
fee (such Bank's "Tranche A Commitment Fee") of 1/10 of 1%
per annum on the amount of the Tranche A Commitment of such
Bank, whether used or unused, during the quarter (shorter
period commencing with the Execution Date or ending with the
Tranche A Maturity Date) ending on such date. Tandy shall
pay each Bank, through the Funds Administrator, on the last
day of each March, June, September and December, and on the
Tranche B Maturity Date, in immediately available funds, a
commitment fee (such Bank's "Tranche B Commitment Fee") of
3/20 of 1% per annum on the amount of the Tranche B
Commitment of such Bank, whether used or unused, during the
quarter (shorter period commencing with the Execution Date or
ending with the Tranche B Maturity Date) ending on such date.
All Commitmet Fees under this Section 2.06(a) shall be
computed on the basis of the actual number of days elapsed in
a year of 360 days. The Commitment Fee due to each Bank with
respect to each Tranche shall cease to accrue on the earlier
of the Tranche A Maturity Date or Tranche B Maturity Date, as
the case may be, or the termination of the applicable Tranche
A Commitment or Tranche B Commitment of such Bank pursuant to
Section 2.07.
(b) Tandy shall pay to each Bank on the Execution
Date a closing fee (the "Closing Fee") in an amount equal to
1/20 of 1% times the sum of the Commitments of such Bank.
(c) Tandy shall pay the Administrative Agent, an
agency fee (the "Agency Fee") in such amount as may be agreed
between the Borrower and the Agent pursuant to that certain
letter agreement of even date herewith between Tandy and the
Administrative Agent (the "Agent's Letter").
(d) Tandy shall pay to TCB and Chemical Bank, for
their own account, on or before the Execution Date all fees
due to them pursuant to that certain letter agreement dated
April 26, 1991 among Tandy, TCB-Dallas and Chemical Bank.
SECTION 2.07. Termination and Reduction of Commitments;
Subsequent Increases of Commitments. (a) Upon at least ten
Business Days' prior written or telex notice to the Agents,
the Borrowers may at any time in whole permanently terminate,
or from time to time permanently reduce, the Total
Commitment, ratably among the Banks in accordance with their
respective Tranche A Commitment and Tranche B Commitment;
provided, however, that any partial reduction of the Total
Commitment shall be in a minimum aggregate principal amount
of $20,000,000.
(b) At the time the Commitments of any Bank are
terminated or reduced pursuant to Section 2.07(a) or Section
2.10(b) the Borrowers shall pay to the Funds Administrator
for the account of each such Bank, the Commitment Fees on the
amount of the Commitments so terminated or reduced owed
through the date of such termination or reduction.
SECTION 2.08. Interest on Overdue Amounts. If either
Borrower shall default in the payment of the principal of or
interest on any Loan or any other amount due hereunder, by
acceleration or otherwise, such Borrower shall on demand from
time to time pay interest, to the extent permitted by law, on
such defaulted amount up to (but not including) the date of
actual payment (after as well as before judgment) at a rate
per annum (computed on the basis of the actual number of days
elapsed over a period of 360 days) equal to the lesser of (a)
the Highest Lawful Rate and (b) the Alternate Base Rate plus
2% per annum.
SECTION 2.09. Alternate Rate of Interest. (a) In the
event, and on each occasion, that on the day two Business
Days prior to the commencement of any Interest Period for a
Borrowing to be comprised of Eurodollar Loans, the Funds
Administrator shall have determined (which determination
shall be conclusive and binding upon the Borrowers) that
dollar deposits in the amount of the requested principal
amount of such Borrowing are not generally available in the
London Interbank Market, or that the rate at which dollar
deposits are being offered will not adequately and fairly
reflect the cost to any Bank of making or maintaining the
principal amount of its Eurodollar Loan comprising such
Borrowing during such Interest Period, or reasonable means do
not exist for ascertaining the LIBO Rate, the Funds
Administrator shall as soon as practicable thereafter give
written or telex notice of such determination to the
Borrowers, the Administrative Agent and the Banks, and any
request by a Borrower for the making of a Borrowing to be
comprised of Eurodollar Loans shall, until the circumstances
giving rise to such notice no longer exist, be deemed to be a
request for a Borrowing to be comprised of Alternate Base
Rate Loans or, if such Borrower shall so specify in its
notice to the Funds Administrator, a request for a Borrowing
to be comprised of Certificate of Deposit Loans so long as
the circumstances giving rise to a notice under Section
2.09(b) shall not exist. Each determination of the Funds
Administrator hereunder shall be conclusive absent
demonstrable error. In the event of such determination, the
Borrower requesting such Borrowing shall have the right to
withdraw its Notice of Borrowing requesting Eurodollar Loans.
(b) In the event, and on each occasion, that on or before
the day on which the Adjusted CD Rate for a Borrowing to be
comprised of Certificate of Deposit Loans is to be
determined, the Funds Administrator shall have determined
(which determination shall be conclusive and binding upon the
Borrowers absent demonstrable error) that the Adjusted CD
Rate for such Loan cannot be ascertained for any reason,
including the inability or failure of the Funds Administrator
to obtain sufficient bids in accordance with the terms of the
definition of Fixed Certificate of Deposit Rate, or the Funds
Administrator shall determine that the Adjusted CD Rate for
the Certificate of Deposit Loans comprising such Borrowing
will not adequately and fairly reflect the cost to any Bank
of making or maintaining the principal amount of its
Certificate of Deposit Loan during such Interest Period, the
Funds Administrator shall, as soon as practicable thereafter,
give written or telex notice of such determination to the
Borrowers, the Administrative Agent and the Banks, and any
request by a Borrower for the making of a Borrowing to be
comprised of Certificate of Deposit Loans shall, until the
circumstances giving rise to such notice no longer exist, be
deemed to be a request for a Borrowing to be comprised of
Alternate Base Rate Loans, or, if such Borrower shall so
specify in its notice to the Funds Administrator, a request
for a Borrowing to be comprised of Eurodollar Loans so long
as the circumstances giving rise to a notice under Section
2.09(a) shall not exist. Each determination by the Funds
Administrator hereunder shall be conclusive absent
demonstrable error. In the event of such determination, the
Borrower requesting such Borrowing shall have the right to
withdraw its Notice of Borrowing requesting Certificate of
Deposit Loans.
SECTION 2.10. Prepayment of Loans. (a) Each Borrowing
may be prepaid at any time and from time to time, in whole or
in part, subject to the requirements of Section 2.13 but
otherwise without premium or penalty, upon at least five
Business Days' prior written or telex notice to the Funds
Administrator; provided, however, that each such partial
prepayment shall be in an integral multiple of $1,000,000 and
a minimum aggregate principal amount of $5,000,000.
(b) On the date of any termination or reduction of
the Total Tranche A Commitment or the Total Tranche B
Commitment pursuant to Section 2.07(a), each Borrower shall
prepay so much of its Loans of such Tranche (up to the amount
by which the Tranche A Commitment or the Tranche B
Commitment, as the case may be, is so terminated or reduced)
as shall be necessary in order that the aggregate principal
amount of the Loans of such Tranche outstanding will not
exceed the Tranche A Commitment or the Tranche B Commitment,
as the case may be, following such termination or reduction.
All prepayments under this paragraph shall be subject to
Section 2.13.
(c) On any date when the aggregate principal
amount of the outstanding Loans owed by TCC exceeds the
lesser of (i) the Total Commitment and (ii) the then-current
Borrowing Base, TCC shall make a mandatory prepayment of the
Loans in such amount as may be necessary so that the
aggregate amount of outstanding Loans of TCC after giving
effect to such prepayment does not exceed the lesser of (i)
the Total Commitment and (ii) the then-current Borrowing
Base. All prepayments under this paragraph shall be subject
to Section 2.13.
(d) Each notice of prepayment shall specify the
prepayment date and the principal amount of each Borrowing
(or portion thereof) to be prepaid, shall specify whether the
Borrowing to be prepaid is a Tranche A Borrowing or a Tranche
B Borrowing, shall be irrevocable and shall commit the
Borrower making such prepayment to prepay such Loan by the
amount stated therein on the date stated therein. All
prepayments shall be accompanied by accrued interest on the
principal amount being prepaid to the date of prepayment.
SECTION 2.11. Reserve Requirements; Change in
Circumstances. (a) It is understood that the cost of each
Bank of making or maintaining any of the Eurodollar Loans may
fluctuate as a result of the applicability of reserve
requirements imposed by the Board at the ratios provided for
in Regulation D on the date hereof. The Borrowers agree to
pay to each of the Banks from time to time such amounts as
shall be necessary to compensate such Bank for the portion of
the cost of making or maintaining Eurodollar Loans resulting
from any such reserve requirements provided for in Regulation
D as in effect on the date hereof, it being understood that
the rates of interest applicable to Eurodollar Loans have
been determined on the assumption that no such reserve
requirements exist or will exist and that such rates do not
reflect costs imposed on the Banks in connection with such
reserve requirements.
(b) Notwithstanding any other provision herein, if
after the date of this Agreement any change in applicable law
or regulation or in the interpretation or administration
thereof by any governmental authority charged with the
interpretation or administration thereof (whether or not
having the force of law) shall change the basis of taxation
of payments to any Bank of the principal of or interest on
any Certificate of Deposit Loan or Eurodollar Loan made by
such Bank or any other fees or amounts payable hereunder
(other than taxes imposed on the overall net income of such
Bank by the jurisdiction in which such Bank has its principal
office or is located or by any political subdivision or
taxing authority therein), or shall impose, modify or deem
applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, such Bank (except any such
reserve requirement which is reflected in the Adjusted CD
Rate) or shall impose on such Bank or the London Interbank
Market any other condition affecting this Agreement or the
Certificate of Deposit Loans or Eurodollar Loans made by such
Bank and the result of any of the foregoing shall be to
increase the cost to such Bank of making or maintaining any
Certificate of Deposit Loan or Eurodollar Loan or to reduce
the amount of any sum received or receivable by such Bank
hereunder (whether of principal, interest or otherwise) in
respect thereof, by an amount deemed by such Bank in its sole
discretion to be material, then such additional amount or
amounts as will compensate such Bank for such additional
costs or reduction will be paid to such Bank by each Borrower
with respect to its Eurodollar Loans or Certificate of
Deposit Loans, as applicable.
(c) If any Bank shall have determined that the
applicability of any law, rule, regulation or guideline
adopted pursuant to or arising out of the July 1988 report of
the Basle Committee on Banking Regulations and Supervisory
Practices entitled "International Convergence of Capital
Measurement and Capital Standards," or the adoption after the
date hereof of any other law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the
foregoing or in the interpretation or administration of any
of the foregoing by any governmental authority, central bank
or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or any
lending office of such Bank) or any Bank's holding company
with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on such Bank's
capital or on the capital of such Bank's holding company, if
any, as a consequence of this Agreement or the Loans made by
such Bank pursuant hereto to a level below that which such
Bank or such Bank's holding company could have achieved but
for such adoption, change or compliance (taking into
consideration such Bank's policies and the policies of such
Bank's holding company with respect to capital adequacy) by
an amount deemed by such Bank to be material, then from time
to time Tandy shall pay to such Bank such additional amount
or amounts as will compensate such Bank or such Bank's
holding company for any such reduction suffered. Without
limitation of the foregoing and without prejudicing the
rights of any Bank to claim compensation under this Section
2.11(c) with respect to its Tranche B Loans, it is agreed
that the interest rates and fees provided for in this
Agreement have been determined on the understanding that the
Banks will not be required to maintain capital against their
Tranche A Commitments under currently applicable laws,
regulations and regulatory guidelines, and that the Banks
will be entitled to make claims under this paragraph in the
event such understanding proves to be incorrect.
(d) A certificate of each Bank setting forth such
amount or amounts as shall be necessary to compensate such
Bank (or participating banks or other entities pursuant to
Article IX) as specified in paragraph (a), (b) or (c) above
shall be delivered to the Borrower obligated with respect
thereto and shall be conclusive absent demonstrable error.
Each Borrower shall pay each Bank the amount shown as due
from it on any such certificate within 10 days after its
receipt of the same.
(e) Failure on the part of any Bank to demand compensation
for any increased costs or reduction in amounts received or
receivable with respect to any Interest Period shall not
constitute a waiver of such Bank's rights to demand
compensation for any increased costs or reduction in amounts
received or receivable in such Interest Period or in any
other Interest Period. The protection of this Section 2.11
shall be available to each Bank regardless of any possible
contention of the invalidity or inapplicability of any law,
regulation or other condition which shall give rise to any
demand by such Bank for compensation.
(f) Nothing in this Section 2.11 shall entitle any
Bank to receive interest at a rate per annum in excess of the
Highest Lawful Rate.
SECTION 2.12. Change in Legality. (a) Notwithstanding
anything to the contrary herein contained, if any change in
any law or regulation or in the interpretation thereof by any
governmental authority charged with the administration or
interpretation thereof shall make it unlawful for any Bank to
make or maintain any Eurodollar Loan or to give effect to its
obligations as contemplated hereby, then, by written notice
to the Borrowers and to the Agents, such Bank may:
(i) declare that Eurodollar Loans will not
thereafter be made by such Bank hereunder, whereupon any
request by a Borrower for a Borrowing to be comprised of
Eurodollar Loans shall, as to such Bank only, be deemed
a request for an Alternate Base Rate Loan unless such
declaration shall be subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Loans
made by it be converted to Alternate Base Rate Loans, in
which event all such Eurodollar Loans shall be
automatically converted to Alternate Base Rate Loans as
of the effective date of such notice as provided in
paragraph (b) below.
In the event any Bank shall exercise its rights under (i) or
(ii) above, all payments and prepayments of principal which
would otherwise have been applied to repay the Eurodollar
Loans that would have been made by such Bank or the converted
Eurodollar Loans of such Bank shall instead be applied to
repay the Alternate Base Rate Loans made by such Bank in lieu
of, or resulting from the conversion of, such Eurodollar
Loans; provided, however, the Alternate Base Rate Loans
resulting from the conversion of such Eurodollar Loans shall
be prepayable only at the times the converted Eurodollar
Loans would have been prepayable, notwithstanding the
provisions of Section 2.10(a).
(b) For purposes of Section 2.12(a), a notice to a
Borrower by any Bank shall be effective as to each Eurodollar
Loan, if lawful, on the last day of the then current Interest
Period or, if there are then two or more current Interest
Periods, on the last day of each such Interest Period,
respectively; otherwise, such notice shall be effective on
the date of receipt by such Borrower.
SECTION 2.13. Indemnity. (a) Each Borrower shall
indemnify each Bank against any loss or expense which such
Bank may sustain or incur as a consequence of (a) any failure
by such Borrower to fulfill on the date of any Borrowing
hereunder the applicable conditions set forth in Article IV,
(b) any failure by such Borrower to borrow hereunder after
delivery of a Notice of Borrowing or a notice of refinancing
or continuation has been given pursuant to Section 2.03, (c)
any payment, prepayment or conversion of a Certificate of
Deposit Loan or Eurodollar Loan required by any other
provision of this Agreement or otherwise made on a date other
than the last day of the applicable Interest Period, (d) any
default in payment or prepayment of the principal amount of
any Loan or any part thereof or interest accrued thereon, as
and when due and payable (at the due date thereof, by
irrevocable notice of prepayment or otherwise), or (e) the
occurrence of any Event of Default, including, but not
limited to, any loss or reasonable expense sustained or
incurred or to be sustained or incurred in liquidating or
employing deposits from third parties acquired to effect or
maintain such Loan or any part thereof as a Certificate of
Deposit Loan or Eurodollar Loan. Such loss or reasonable
expense shall include an amount equal to the excess, if any,
as reasonably determined by each Bank of (i) its cost of
obtaining the funds for the Loan being paid, prepaid or
converted or not borrowed (based on the Adjusted CD Rate or
the LIBO Rate applicable thereto) for the period from the
date of such payment, prepayment or conversion or failure to
borrow to the last day of the Interest Period for such Loan
(or, in the case of a failure to borrow, the Interest Period
for such Loan which would have commenced on the date of such
failure to borrow) over (ii) the amount of interest (as
reasonably determined by such Bank) that could be realized by
such Bank in reemploying during such period the funds so
paid, prepaid or converted or not borrowed. A certificate of
each Bank setting forth any amount or amounts which such Bank
is entitled to receive pursuant to this Section 2.13 shall be
delivered to the Borrowers and shall be conclusive absent
demonstrable error. Nothing in this Section 2.13 shall
entitle any Bank to receive interest at a rate per annum in
excess of the Highest Lawful Rate.
(c) The provisions of this Section 2.13 shall
remain operative and in full force and effect regardless of
the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or
unenforceability of any term or provision of this Agreement
or any Note, or any investigation made by or on behalf of any
Bank. All amounts due under this Section 2.13 shall be
payable on written demand therefor.
SECTION 2.14. Pro Rata Treatment. Except as permitted
under Section 2.11, Section 2.12 and Section 2.13, with
respect to each Tranche, each Borrowing, each payment or
prepayment of principal of the Notes of such Tranche, each
payment of interest on such Notes, each other reduction of
the principal or interest outstanding under such Notes,
however achieved, each payment of the relevant Commitment
Fees and each reduction of the relevant Commitments shall be
made pro rata among the Banks in the proportions that their
respective Tranche A Commitment or Tranche B Commitment bears
to the Total Tranche A Commitment or Total Tranche B
Commitment.
SECTION 2.15. Refinancings. A Borrower may refinance all
or any part of any Borrowing with a Borrowing of the same or
a different Type made pursuant to Section 2.02, subject to
the conditions and limitations set forth herein and elsewhere
in this Agreement, including refinancings of Tranche A
Borrowings with Tranche B Borrowings and Tranche B Borrowings
with Tranche A Borrowings. Any Borrowing or part thereof so
refinanced shall be deemed to be repaid in accordance with
Section 2.07 with the proceeds of a new Borrowing hereunder
and the proceeds of the new Borrowing, to the extent they do
not exceed the principal amount of the Borrowing being
refinanced, shall not be paid by the Banks to the Funds
Administrator or by the Funds Administrator to such Borrower
pursuant to Section 2.02(c).
SECTION 2.16. Payments. (a) The Borrowers shall make
all payments (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder and under
any other Loan Document not later than 1:00 p.m., Houston,
Texas time, on the date when due in dollars to the Funds
Administrator at its offices at 712 Main Street, Houston,
Texas, in immediately available funds.
(b) Whenever any payment (including principal of
or interest on any Borrowing or any Fees or other amounts)
hereunder or under any other Loan Document shall become due,
or otherwise would occur, on a day that is not a Business
Day, such payment may be made on the next succeeding Business
Day, and such extension of time shall in such case be
included in the computation of interest or Fees, if
applicable.
SECTION 2.17. Sharing of Setoffs. With respect to each
Tranche, each Bank agrees that if it shall, in any manner,
including through the exercise of a right of banker's lien,
setoff or counterclaim against a Borrower, or pursuant to a
secured claim under Section 506 of Title 11 of the United
States Code or other security or interest arising from, or in
lieu of, such secured claim, received by such Bank under any
applicable bankruptcy, insolvency or other similar law or
otherwise, obtain payment (voluntary or involuntary) in
respect of a Note of such Borrower of such Tranche held by it
as a result of which the unpaid principal portion of the Note
of such Borrower of such Tranche held by it shall be
proportionately less than the unpaid principal portion of the
Note of such Borrower of such Tranche held by any other Bank,
it shall be deemed to have simultaneously purchased from such
other Bank a participation in the Note of such Borrower of
such Tranche held by such other Bank, so that the aggregate
unpaid principal amount of the Notes of such Borrower and
participations in Notes of such Borrower of such Tranche held
by each Bank shall be in the same proportion to the aggregate
unpaid principal amount of all Notes of such Borrower of such
Tranche then outstanding as the principal amount of the Note
of such Borrower of such Tranche held by it prior to such
exercise of banker's lien, setoff or counterclaim was to the
principal amount of all Notes of such Borrower outstanding
prior to such exercise of banker's lien, setoff or
counterclaim; provided, however, that if any such purchase or
purchases or adjustments shall be made pursuant to this
Section 2.17 and the payment giving rise thereto shall
thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery
and the purchase price or prices or adjustment restored
without interest. Each Borrower expressly consents to the
foregoing arrangements and agrees that any Person holding a
participation in a Note deemed to have been so purchased may
exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by each
Borrower to such Bank as fully as if such Bank had made a
Loan directly to each Borrower in the amount of such
participation.
SECTION 2.18. Payments Free of Taxes. (a) Any and all
payments by a Borrower hereunder shall be made, in accordance
with Section 2.02(c), free and clear of and without deduction
for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with
respect thereto, excluding taxes imposed on either Agent's or
any Bank's (or any transferee's or assignee's, including a
participation holder's (any such entity a "Transferee") net
income and franchise taxes imposed on either Agent or any
Bank (or Transferee) by the United States or any jurisdiction
under the laws of which it is organized or any political
subdivision thereof (all such nonexcluded taxes, levies,
imposts, deductions, charges, withholdings and liabilities
being hereinafter referred to as "Taxes"). If a Borrower
shall be required by law to deduct any Taxes from or in
respect of any sum payable hereunder to the Banks (or any
Transferee or either Agent, (i) the sum payable shall be
increased by the amount necessary so that after making all
required deductions (including deductions applicable to
additional sums payable under this Section 2.18) such Bank
(or Transferee) or such Agent (as the case may be) shall
receive an amount equal to the sum it would have received had
no such deductions been made, (ii) such Borrower shall make
such deductions and (iii) such Borrower shall pay the full
amount deducted to the relevant taxing authority or other
governmental authority in accordance with applicable law.
(b) In addition, each 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 any other Loan Document (hereinafter
referred to as "Other Taxes").
(c) Each Borrower will indemnify each Bank (or
Transferee) and each Agent for the full amount of Taxes and
Other Taxes (including any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this Section 2.18)
paid by such Bank (or Transferee or such 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 by the relevant taxing authority or other
governmental authority. Such indemnification shall be made
within 30 days after the date any Bank (or Transferee) or
either Agent, as the case may be, makes written demand
therefor. If a Bank (or Transferee) or an Agent shall become
aware that it is entitled to receive a refund in respect of
Taxes or Other Taxes, it shall promptly notify the applicable
Borrower of the availability of such refund and shall, within
30 days after receipt of a request by such Borrower, apply
for such refund at such Borrower's expense. If any Bank (or
Transferee) or the Funds Administrator receives a refund in
respect of any Taxes or Other Taxes for which such Bank (or
Transferee) or the Funds Administrator has received payment
from a Borrower hereunder it shall promptly notify such
Borrower of such refund and shall, within 30 days after
receipt of a request by such Borrower (or promptly upon
receipt, if such Borrower has requested application for such
refund pursuant hereto), repay such refund to such Borrower,
net of all out-of-pocket expenses of such Bank and without
interest; provided that such Borrower, upon the request of
such Bank (or Transferee) or the Funds Administrator, agrees
to return such refund (plus penalties, interest or other
charges) to such Bank (or Transferee) or the Funds
Administrator in the event such Bank (or Transferee) or the
Funds Administrator is required to repay such refund.
(d) Within 30 days after the date of any payment
of Taxes or Other Taxes withheld by a Borrower in respect of
any payment to any Bank (or Transferee) or the Funds
Administrator, such Borrower will furnish to the Funds
Administrator, at its address referred to in Section 9.01,
the original or a certified copy of a receipt evidencing
payment thereof.
(e) Without prejudice to the survival of any other
agreement contained herein, the agreements and obligations
contained in this Section 2.18 shall survive the payment in
full of the principal of and interest on all Loans made
hereunder.
(f) Each Bank (or Transferee) which is organized
outside the United States shall promptly notify the Borrowers
of any changes in its funding office and upon written request
of the Borrowers shall, prior to the immediately following
due date of any payment by a Borrower hereunder, deliver to
the Borrowers such certificates, documents or other evidence,
as required by the Code or Treasury Regulations issued
pursuant thereto, including Internal Revenue Service Form
1001 or Form 4224 and any other certificate or statement of
exemption required by Treasury Regulation Section 1.1441-1(a)
or Section 1.1441-6(c) or any subsequent version thereof,
properly completed and duly executed by such Bank (or
Transferee) establishing that such payment is (i) not subject
to withholding under the Code because such payment is
effectively connected with the conduct by such Bank (or
Transferee) of a trade or business in the United States or
(ii) totally exempt from United States tax under a provision
of an applicable tax treaty. Unless the Borrowers and the
Funds Administrator have received forms or other documents
satisfactory to them indicating that payments hereunder or
under the Notes are not subject to United States withholding
tax or are subject to such tax at a rate reduced by an
applicable tax treaty, the Borrowers or the Funds
Administrator shall withhold taxes from such payments at the
applicable statutory rate in the case of payments to or for
any Bank (or Transferee) or assignee organized under the laws
of a jurisdiction outside the United States.
(g) No Borrower shall be required to pay any
additional amounts to any Bank (or Transferee) in respect of
United States withholding tax pursuant to paragraph (a) above
if the obligation to pay such additional amounts would not
have arisen but for a failure by such Bank (or Transferee) to
comply with the provisions of paragraph (f) above unless such
failure results from (i) a change in applicable law,
regulation or official interpretation thereof or (ii) an
amendment, modification or revocation of any applicable tax
treaty or a change in official position regarding the
application or interpretation thereof, in each case after the
Closing Date (and, in the case of a Transferee, after the
date of assignment or transfer).
(h) Any Bank (or Transferee) claiming any
additional amounts payable pursuant to this Section 2.18
shall use reasonable efforts (consistent with legal and
regulatory restrictions) to file any certificate or document
requested by a Borrower or to change the jurisdiction of its
applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any
such additional amounts which may thereafter accrue and would
not, in the sole determination of such Bank, be otherwise
disadvantageous to such Bank (or Transferee).
(i) If any Bank (or Transferee) requests
compensation pursuant to this Section 2.18 hereof, the
Borrowers may give notice to such Bank (with a copy to the
Agents) that it wishes to seek one or more Eligible Assignees
(which may be one or more of the Banks) to assume the
Commitments of such Bank and to purchase its outstanding
Loans and Notes. Each Bank (or Transferee) requesting
compensation pursuant to Section 2.18 hereto agrees to sell
all of its Commitments, its Loans and its Notes pursuant to
Section 9.03 to any such Eligible Assignee for an amount
equal to the sum of the outstanding unpaid principal of and
accrued interest on such Loans and Notes plus all Commitment
Fees and other fees and amounts due such Bank (or Transferee)
hereunder calculated, in each case, to the date such
Commitments, Loans and Notes are purchased, whereupon such
Bank (or Transferee) shall have no further Commitments or
other obligation to either Borrower hereunder or under any
Note.
SECTION 2.19. Classification Downgrade. In the event
the facilities available under this Agreement or any Loan or
the Notes shall be classified as a "highly leveraged
transaction" in accordance with published United States
regulations (an "HLT Classification") by (a) either Agent or
(b) any United States governmental authority with supervisory
responsibility over either Agent or any of the Banks, either
Agent or any of the Banks so advised shall forthwith notify
the Borrowers and the Administrative Agent (who shall
forthwith notify each of the Banks and the other Agent).
Upon receipt of such notification, the Borrowers and the
Agents shall forthwith commence discussions and in good faith
negotiate revisions to this Agreement (including interest
rate, fees, term, covenants, representations and any other
items deemed relevant) so as to reflect market terms and
conditions then offered for facilities reasonably similar in
type, term and amount to that under this Agreement and
similarly classified. Any such revisions shall be subject to
the approval of the Agents and the Required Banks. If the
Borrowers and the Required Banks shall fail to agree on such
an increase within 90 days after notice of such HLT
Classification is given to the Agents and the Banks as
provided above, then (i) the Administrative Agent shall, if
requested by the Required Banks, by notice to the Borrowers,
immediately terminate the Commitments of the Banks, and (ii)
upon such termination, the Borrowers shall prepay the Loans
outstanding hereunder in full, together with any interest
accrued thereon to the date of such prepayment and any
amounts payable pursuant to Section 2.13 hereof in connection
therewith. The Banks acknowledge that (without prejudice to
the preceding sentence) an HLT Classification shall not per
se constitute a Default or an Event of Default hereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants as to itself and
Tandy represents and warrants as to each of its Subsidiaries
that:
SECTION 3.01. Organization, Corporate Powers. Each
Borrower and each of its Significant Subsidiaries is duly
organized, validly existing and in good standing under the
laws of the state of its incorporation or organization, has
the requisite power and authority to own its property and
assets and to carry on its business as now conducted and is
qualified to do business in every jurisdiction where such
qualification is required, except where the failure so to
qualify would not have a material adverse effect on the
condition, financial or otherwise, of Tandy or TCC. Each of
Tandy and TCC has the corporate power to execute, deliver and
perform its obligations under this Agreement and the other
Loan Documents to which it is a party, to borrow hereunder,
to execute and deliver the Notes to which it is a party and
to comply with the terms of the Operating Agreement and the
Support Agreement. TCC does not and will not have any
Subsidiaries other than TRC.
SECTION 3.02. Authorization. The execution, delivery
and performance of this Agreement, the Operating Agreement
and the Support Agreement, the borrowings hereunder, and the
execution and delivery of the Notes by the Borrowers and the
Tandy Guaranty by Tandy (a) have been duly authorized by all
requisite corporate and, if required, stockholder action on
the part of the Borrowers and (b) will not (i) violate (A)
any provision of law, statute, rule or regulation or the
certificate of incorporation or the bylaws of either
Borrower, (B) any order of any court, or any rule, regulation
or order of any other agency of government binding upon
either Borrower or (C) any provisions of any indenture,
agreement or other instrument to which either Borrower is a
party, or by which either Borrower or Tandy or any of its
properties or assets are or may be bound, (ii) be in conflict
with, result in a breach of or constitute (alone or with
notice or lapse of time or both) a default under any
indenture, agreement or other instrument referred to in
(b)(i)(C) above or (iii) result in the creation or imposition
of any lien, charge or encumbrance of any nature whatsoever
upon any property or assets of either Borrower.
SECTION 3.03. Governmental Approval. No registration
with or consent or approval of, or other action by, any
federal, state or other governmental agency, authority or
regulatory body is or will be required in connection with the
execution, delivery and performance of this Agreement, the
execution and delivery of the Notes, the Borrowings hereunder
or the performance of the Operating Agreement and the Support
Agreement by either Borrower.
SECTION 3.04. Enforceability. This Agreement, the
Operating Agreement and the Support Agreement have been duly
executed and delivered by the Borrowers and constitute legal,
valid and binding obligations of the Borrowers, and the Notes
and the Tandy Guaranty, when duly executed and delivered by
the Borrower signatory thereto, will constitute legal, valid
and binding obligations of such Borrower, in each case
enforceable in accordance with their respective terms
(subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium and
similar laws affecting creditors' rights generally).
SECTION 3.05. Financial Statements. (a) The audited
consolidated financial statements of Tandy and TCC, in each
case, as at June 30, 1990, copies of which have been
furnished to the Banks, have been prepared in conformity with
generally accepted accounting principles applied on a basis
consistent with that of the preceding fiscal year, and
present fairly the financial conditions of Tandy and its
Subsidiaries and TCC, respectively, as at such date and the
results of their operations for the period then ended.
(b) The Forms 10-Q of Tandy and TCC, in each case,
as at each of December 31, 1990 and March 31, 1991, copies of
which have been furnished to the Banks, have been prepared in
accordance with all applicable rules, regulations and
guidelines of the Securities and Exchange Commission and
present fairly the financial condition of Tandy and its
Subsidiaries and TCC, respectively, as at such dates and the
results of their operations for the periods then ended,
subject to year-end audit adjustments.
SECTION 3.06. No Material Adverse Change. There has
been no material adverse change in the businesses, assets,
operations, prospects or condition, financial or otherwise,
of Tandy or TCC since June 30, 1990.
SECTION 3.07. Title to Properties. Each of Tandy and
TCC has good and marketable title to, or valid leasehold
interests in, all its properties and assets, except for such
properties as are no longer used or useful in the conduct of
its businesses or as have been disposed of in the ordinary
course of business and except for minor defects in title that
do not interfere with the ability of Tandy or TCC to conduct
its business as now conducted.
SECTION 3.08. Litigation; Compliance with Laws; etc.
(a) There are not any actions, suits or proceedings at law or
in equity or by or before any governmental instrumentality or
other agency or regulatory authority now pending or, to the
knowledge of Tandy or TCC, threatened against or affecting
Tandy or TCC or any other Subsidiary of Tandy or the
businesses, assets or rights of Tandy or TCC or any other
Subsidiary of Tandy (i) which involve this Agreement, the
Operating Agreement or the Support Agreement or any of the
transactions contemplated hereby or thereby or (ii) as to
which there is a reasonable possibility of an adverse
determination and which, if adversely determined, could,
individually or in the aggregate, materially impair the
ability of Tandy or TCC to conduct business substantially as
now conducted, or materially and adversely affect the
businesses, assets, operations, prospects or condition,
financial or otherwise, of Tandy or TCC, or impair the
validity or enforceability of or the ability of Tandy or TCC
to perform its obligations under this Agreement, the
Operating Agreement, the Support Agreement or any of the
Notes or other Loan Documents.
(b) Neither Tandy nor TCC is in violation of any
law, the breach or consequence of which would materially and
adversely affect the ability of Tandy or TCC to carry on its
business, or in default under any material order, writ,
injunction, award or decree of any court, arbitrator,
administrative agency or other governmental authority binding
upon it or its assets or any material indenture, mortgage,
contract, agreement or other undertaking or instrument to
which it is a party or by which any of its properties may be
bound, and nothing has occurred which would materially and
adversely affect the ability of Tandy or TCC to carry on its
business or perform its obligations under any such order,
writ, injunction, award or decree or any such material
indenture, mortgage, contract, agreement or other undertaking
or instrument.
SECTION 3.09. Agreements; No Default. (a) Neither
Tandy nor TCC is a party to any agreement or instrument or
subject to any corporate restriction that has a present
material and adverse effect on the business, properties,
assets, operations, prospects or condition, financial or
otherwise, of Tandy or TCC, respectively.
(b) Neither Tandy nor TCC is in default in any
manner that would materially and adversely affect the
business, properties, assets, operations, prospects or
condition, financial or otherwise, of Tandy or TCC or the
performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any
material agreement or instrument to which it is a party.
(c) Neither Tandy nor any of its Subsidiaries is
in default under any agreement or instrument to which Tandy
or any Subsidiary is a party or by which any of their
respective properties or assets is bound or affected, which
default might materially and adversely affect the financial
condition or operations of Tandy and its Subsidiaries taken
as a whole. No Event of Default has occurred and is
continuing.
SECTION 3.10. Federal Reserve Regulations.
(a) Neither Tandy nor TCC is engaged principally,
or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying
Margin Stock.
(b) No part of the proceeds of the Loans will be
used, whether directly or indirectly, and whether
immediately, incidentally or ultimately, (i) to purchase or
carry Margin Stock or to extend credit to others for the
purpose of purchasing or carrying Margin Stock or to refund
indebtedness originally incurred for such purpose, or (ii)
for any purpose which entails a violation of, or which is
inconsistent with, the provisions of the Regulations of the
Board, including Regulations G, T, U or X; provided, however,
Tandy may acquire Margin Stock if, upon the acquisition of
such Margin Stock, 25% or less of Tandy's total assets
subject to the restrictions set forth in Section 6.01 would
then be composed of Margin Stock, and furnish to the
Administrative Agent upon its request, a statement in
conformity with the requirements of Federal Reserve Form U-1
referred to in Regulation U.
SECTION 3.11. Taxes. Each Borrower and each of its
Subsidiaries has filed all tax returns which are required to
have been filed and has paid, or made adequate provisions for
the payment of, all of its taxes which are due and payable,
except such taxes, if any, as are being contested in good
faith and by appropriate proceedings and as to which such
reserves or other appropriate provisions as may be required
by generally accepted accounting principles have been
maintained. The federal income tax liability of Tandy and
its Subsidiaries has been audited by the Internal Revenue
Service and has been finally determined and satisfied (or the
time for audit has expired) for all tax years up to and
including the tax year ended June 30, 1979. Tandy deems the
amounts and maximum final judgments from such action to be
immaterial to Tandy. Neither Borrower is aware of any
proposed assessment against it or any of its Subsidiaries for
additional taxes (or any basis for any such assessment) which
might be material to either Borrower and its Subsidiaries
taken as a whole.
SECTION 3.12. Pension and Welfare Plans. Each Plan
complies in all material respects with all applicable
statutes and governmental rules and regulations, and: (a) no
Reportable Event has occurred and is continuing with respect
to any Plan, (b) neither Tandy, TCC nor any ERISA Affiliate
has withdrawn from any Plan or instituted steps to do so, and
(c) except as listed on Exhibit 3.12, no steps have been
instituted to terminate any Plan. No condition exists or
event or transaction has occurred in connection with any Plan
which could result in the incurrence by Tandy, TCC or any
ERISA Affiliate of any material liability, fine or penalty.
Neither Tandy, TCC nor any ERISA Affiliate is a member of, or
contributes to, any multiple employer Plan as described in
section 4064 of ERISA. Neither Borrower nor any of its
Subsidiaries has any contingent liability with respect to any
post-retirement "welfare benefit plans," as such term is
defined in ERISA.
SECTION 3.13. No Material Misstatements. Neither this
Agreement, the other Loan Documents, the Confidential
Information Memorandum nor any other document delivered by or
on behalf of Tandy or any of its Affiliates (including each
Borrower's Annual Report on Form 10-K for 1990 and each
Borrower's Quarterly Report on Form 10-Q for the three fiscal
quarters ended at March 31, 1991) in connection with any Loan
Document or included therein contained or contains any
material misstatement of fact or omitted or omits to state
any material fact necessary to make the statements therein,
in the light of the circumstances under which they were made,
not misleading.
SECTION 3.14. Investment Company Act; Public Utility
Holding Company Act. Neither Tandy nor TCC is an "investment
company" or a company "controlled" by an investment company
as defined in, or subject to regulation under, the Investment
Company Act of 1940. Neither Tandy nor TCC is a "holding
company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935.
SECTION 3.15. Business; Liabilities of TCC. TCC has
conducted no business other than the purchase, service and
collection of accounts receivable under the Operating
Agreement and, in September 1987, the one time purchase of
existing Radio Shack customer accounts created under an
agreement with Citibank, N.A.
SECTION 3.16. Compliance with Laws. To the best
knowledge of each Borrower, after due investigation, each
Borrower and its Subsidiaries are in material compliance with
all statutes and governmental rules and regulations
applicable to them.
SECTION 3.17. Maintenance of Insurance. Each Borrower
maintains, and causes each of its Subsidiaries to maintain,
insurance to such extent and against such hazards and
liabilities as is commonly maintained by companies similarly
situated.
SECTION 3.18. Existing Liens. None of the assets of
either Borrower or any of its Subsidiaries is subject to any
Lien, except:
(a) Liens for current taxes not delinquent or
taxes being contested in good faith and by appropriate
proceedings and as to which such reserves or other
appropriate provisions as may be required by generally
accepted accounting principles are being maintained;
(b) carriers', warehousemen's, mechanics',
materialmen's and other like statutory Liens arising in
the ordinary course of business securing obligations
which are not overdue for a period of more than 90 days
or which are being contested in good faith and by
appropriate proceedings and as to which such reserves or
other appropriate provisions as may be required by
generally accepted accounting principles are being
maintained;
(c) pledges or deposits in connection with
workers' compensation, unemployment insurance and other
social security legislation;
(d) deposits to secure the performance of bids,
trade contracts, leases, statutory obligations, and
other obligations of a like nature incurred in the
ordinary course of business, and Liens securing
reimbursement obligations created by open letters of
credit for the purchase of inventory;
(e) Liens granted by a Subsidiary of Tandy (other
than TCC and TRC) to secure such Subsidiary's
Indebtedness to Tandy or to any other Subsidiary of
Tandy;
(f) Liens granted by TRC to the Tandy Master Trust
to secure TRC's Indebtedness to the Tandy Master Trust;
(g) Liens, if any, disclosed in the financial
statements referred to in Section 3.05; and
(h) Liens listed on Exhibit 3.18.
SECTION 3.19. Environmental Matters. Each Borrower and
each of its Subsidiaries has complied in all material
respects with all federal, state, local and other statutes,
ordinances, orders, judgments, rulings and regulations
relating to environmental pollution or to environmental
regulation or control. Neither Borrower nor any of its
Subsidiaries have received notice of any failure so to comply
which alone or together with any other such failure could
result in a material adverse effect on the business, assets,
operations, prospects or condition (financial or otherwise)
of such Borrower or such Subsidiary. None of the facilities
of either Borrower or any of its Subsidiaries manage any
hazardous wastes, hazardous substances, hazardous materials,
toxic substances or toxic pollutants, as those terms are used
in the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response Compensation and
Liability Act, the Hazardous Materials Transportation Act,
the Toxic Substance Control Act, the Clean Air Act or the
Clean Water Act, in violation of any regulations promulgated
pursuant thereto or in any other applicable law where such
violation could result, individually or together with other
violations, in a material adverse effect on the business,
assets, operations, prospects or condition (financial or
otherwise) of such Borrower or such Subsidiary
ARTICLE IV
CONDITIONS OF LENDING
The obligations of the Banks to make Loans hereunder
shall be subject to the following conditions precedent:
SECTION 4.01. All Borrowings. On the date of each
Borrowing hereunder:
(a) The Funds Administrator shall have received a
Notice of Borrowing as required by Section 2.03.
(b) The representations and warranties set forth
in Article III (except, in the case of a Borrowing in
which the aggregate principal amount of Loans
outstanding is not increased, Sections 3.06 and 3.08(a))
hereof shall be true and correct in all material
respects with the same effect as though made on and as
of such date.
(c) Each Borrower shall be in compliance with the
terms and provisions contained herein on its part to be
observed or performed, and at the time of and
immediately after such Borrowing no Event of Default or
Default shall have occurred and be continuing.
Each Borrowing hereunder shall be deemed to be a
representation and warranty by the Borrower on the date of
such Borrowing as to the matters specified in paragraphs (b)
and (c) of this Section 4.01.
SECTION 4.02. All Borrowings to TCC. On the date of
each Borrowing hereunder to TCC, the Banks shall have
received a Borrowing Base Certificate setting forth the
Borrowing Base accompanied by an accounts receivable aging
schedule in the form of Exhibit 1.01-D hereto.
SECTION 4.03. First Borrowing to Either Borrower. The
obligations of the Banks to make Loans hereunder on the
Closing Date to either Borrower are subject to the following
additional conditions precedent:
(a) The Banks shall have received a favorable
written opinion of Rudolph L. Ennis, Staff Attorney of
Tandy, to the effect set forth in Exhibit 4.03 hereto,
dated the Closing Date, addressed to the Banks and
satisfactory to Andrews & Kurth, special counsel for the
Agents; provided, however, it is not a condition
precedent to the Loans to be made to Tandy hereunder
that such opinion address either the Operating Agreement
or the Support Agreement.
(b) All legal matters incident to this Agreement,
the Notes and the Borrowings hereunder shall be
satisfactory to Andrews & Kurth, special counsel for the
Agents.
(c) The Banks shall have received (i) a copy of
the certificate of incorporation, as amended, of each
Borrower, certified by the Secretary of State of
Delaware and a certificate as to the good standing of
and charter documents filed by each Borrower from such
Secretary of State; (ii) a copy of the certificate of
authority to do business in the State of Texas,
certified by the Secretary of State of Texas and a
certificate as to the good standing of each Borrower
from the Comptroller of the State of Texas; (iii) a
certificate of the Secretary or an Assistant Secretary
of each Borrower, dated the Closing Date and certifying
(A) that attached thereto is a true and complete copy of
the bylaws of such Borrower as in effect on the date of
such certificate and at all times since a date prior to
the date of the resolutions described in (B) below, (B)
that attached thereto is a true and complete copy of
resolutions duly adopted by the Board of Directors of
such Borrower authorizing the execution, delivery and
performance of this Agreement, the Operating Agreement,
the Support Agreement and the Notes to be delivered by
such Borrower and the Borrowings by such Borrower
hereunder and that such resolutions have not been
modified, rescinded or amended and are in full force and
effect, (C) that the certificate of incorporation of
such Borrower has not been amended since the date of the
last amendment thereto shown on the good standing
certificate furnished pursuant to (i) above, and (D) as
to the incumbency and specimen signature of each officer
of such Borrower executing this Agreement, the Notes
delivered by such Borrower or any other document
delivered in connection herewith or therewith; (iii) a
certificate of another officer of such Borrower as to
the incumbency and specimen signature of the Secretary
or such Assistant Secretary of such Borrower; and (iv)
such other documents as any Bank or Andrews & Kurth,
special counsel for the Agents, may reasonably request.
(d) The Banks shall have received a certificate,
dated the Closing Date and signed by the chief financial
officer of Tandy, confirming compliance with the
conditions precedent set forth in paragraphs (b) and (c)
of Section 4.01.
(e) The Administrative Agent shall have received
the Notes duly executed by the Borrowers payable to the
order of the respective Banks and otherwise complying
with the provisions of Section 2.04.
(f) The Administrative Agent shall have received a
counterpart of the Agent's Letter duly executed by
Tandy.
SECTION 4.04. First Borrowing to TCC. The obligations
of the Banks to make its initial Loans hereunder to TCC are
subject to the following additional conditions precedent:
(a) Tandy and TCC shall have duly executed and
delivered a certificate certifying that attached thereto
is a true and complete copy of the Operating Agreement
together with all amendments thereto.
(b) Tandy and TCC shall have duly executed and
delivered the Support Agreement.
(c) The Banks shall have received a favorable
written opinion of Rudolph L. Ennis, Staff Attorney of
Tandy, the Borrowers, dated on or prior to the date of
the initial Loan to TCC, covering those matters set
forth in Exhibit 4.03 hereto relating to the Operating
Agreement and the Support Agreement, addressed to the
Banks and satisfactory to Andrews & Kurth, special
counsel for the Agents.
(d) All legal matters incident to the Operating
Agreement and the Support Agreement shall be
satisfactory to Andrews & Kurth, special counsel for the
Agents, including evidence that the agencies that have
rated the commercial paper of TCC have consented to the
Support Agreement.
(e) The Banks shall have received a certificate,
dated the date of the initial borrowing by TCC and
signed by the chief financial officer of TCC, confirming
compliance with the conditions precedent set forth in
paragraphs (b) and (c) of Section 4.01.
ARTICLE V
AFFIRMATIVE COVENANTS
So long as this Agreement shall remain in effect or the
principal of or interest on any Note, any Commitment Fee or
any other expense or amount payable hereunder shall be unpaid
and until the Commitments of the Banks shall expire or
terminate, unless the Required Banks shall otherwise consent
in writing, the Borrowers covenant and agree with each Bank
that:
SECTION 5.01. Existence. Each Borrower will maintain
and preserve, and, subject to the provisions of clauses (w),
(x) and (y) of Section 6.03, will cause each of its
Significant Subsidiaries to maintain and preserve, its
respective existence as a corporation or other form of
business organization, as the case may be, and all rights,
privileges, licenses, patents, patent rights, copyrights,
trademarks, trade names, franchises and other authority to
the extent material and necessary for the conduct of its
respective businesses in the ordinary course as conducted
from time to time, including, in the case of Tandy, its good
standing and qualification to do business in the State of
Texas. TCC is not required to be qualified to do business in
the State of Texas as of the Effective Date.
SECTION 5.02. Repair. Each Borrower will maintain,
preserve and keep, and will cause each of its Significant
Subsidiaries to maintain, preserve and keep, all of its
properties in good repair, working order and condition, and
from time to time make, and each Borrower will make, and will
cause each of its Significant Subsidiaries to make, all
necessary and proper repairs, renewals, replacements,
additions, betterments and improvements thereto so that at
all times the efficiency thereof shall be fully preserved and
maintained; each Borrower will at all times do or cause to be
done all things necessary to preserve, renew and keep in full
force and effect, and will cause each of its Significant
Subsidiaries to do or cause to be done all things necessary
to preserve, renew and keep in full force and effect, the
rights, licenses, permits, franchises, patents, copyrights,
trademarks and trade names material to the conduct of its
businesses; maintain and operate such businesses in
substantially the manner in which they are presently
conducted and operated (subject to changes in the ordinary
course of business); comply in all material respects with all
laws and regulations applicable to the operation of such
businesses whether now in effect or hereafter enacted and
with all other applicable laws and regulations; and take all
action which may be required to obtain, preserve, renew and
extend all licenses, permits and other authorizations which
may be material to the operation of such businesses.
SECTION 5.03. Insurance. The Borrowers will maintain,
on a consolidated basis, insurance to such extent and against
such hazards and liabilities as is commonly maintained by
companies similarly situated or as the Agents or the Required
Banks may reasonably request from time to time.
SECTION 5.04. Obligations and Taxes. Each Borrower
will, pay and discharge, and will cause each of its
Subsidiaries to pay and discharge, when due, all taxes,
assessments and governmental charges or levies imposed upon
such Borrower or such Subsidiary, as the case may be, as well
as all lawful claims for labor, materials and supplies or
otherwise unless and only to the extent that such Borrower or
such Subsidiary, as the case may be, is contesting such
taxes, assessments and governmental changes, levies or claims
in good faith and by appropriate proceedings and such
Borrower or such Subsidiary has set aside on its books such
reserves or other appropriate provisions therefor as may be
required by generally accepted accounting principles.
SECTION 5.05. Financial Statements; Reports. Each
Borrower will furnish to the Agents and each Bank:
(a) Annual Audit Reports. Within 90 days after
the end of each fiscal year of each Borrower, a copy of
the annual audit report of Tandy and its Subsidiaries
prepared on a consolidated basis and of TCC, in each
case, in conformity with generally accepted accounting
principles consistently applied and certified by Price
Waterhouse or another independent certified public
accountant of recognized national standing;
(b) Quarterly Financial Statements. (i) Within 45
days after the end of each quarter (except the last
quarter) of each fiscal year of each Borrower, a copy of
the Form 10-Q of Tandy and of TCC, in each case, for
such quarter, prepared in accordance with the rules,
regulations and guidelines of the Securities and
Exchange Commission, subject to normal year end audit
adjustments and (ii) within 45 days after the end of
each quarter of each fiscal year of TCC, an unaudited
unconsolidated balance sheet and statement of cash
flows, as at the close of such quarter and for such
quarter, together with a certificate of the chief
financial officer or the chief accounting officer of TCC
certifying that such financial statements were prepared
in accordance with generally accepted accounting
principles consistently applied and demonstrating in
reasonable detail compliance by TCC as at the end of
such fiscal quarter with Section 6.05 and setting forth
the tangible net worth on an unconsolidated basis of TCC
as at the end of such fiscal quarter and the Net
Earnings Available for Fixed Charges and the Fixed
Charges (as such terms are defined in, and calculated
pursuant to, the Support Agreement) of TCC for the
twelve-month period ending at the end of such fiscal
quarter.
(c) Officer's Certificate. Together with the
financial statements furnished by the Borrowers under
the preceding clauses (a) and (b), a certificate of each
Borrower's chief financial officer, dated the date of
such annual audit report or such quarterly financial
statement, as the case may be, to the effect that no
Event of Default or Default, has occurred or is
continuing, or if there is any such event, describing it
and the steps, if any, being taken to cure it;
(d) Borrowing Base Certificate of TCC. Within 20
days after the end of each calendar month, a Borrowing
Base Certificate and an accounts receivable aging
schedule substantially in the form of Exhibit 1.01-C
hereto, provided, however, that if no Loans to TCC are
outstanding hereunder, such certificate and schedule
shall be provided concurrently with any delivery under
clauses (a) and (b) above;
(e) SEC and Other Reports. Copies of each filing
and report made by either Borrower or any Subsidiary of
Tandy with or to any securities exchange or the
Securities and Exchange Commission and each
communication from either Borrower or any Subsidiary of
Tandy to shareholders generally, promptly upon the
making thereof; and
(f) Requested Information. Promptly, from time to
time, such other reports or information as the Agents or
any Bank may reasonably request.
SECTION 5.06. Litigation and Other Notices. Each
Borrower will notify the Agents and the Banks in writing of
any of the following immediately upon learning of the
occurrence thereof, describing the same and, if applicable,
the steps being taken by the Person(s) affected with respect
thereto:
(a) Judgment. The entry of any judgment or decree
against TCC if the amount of such judgment or decree
exceeds $10,000,000 or against Tandy and its other
Subsidiaries, taken as a whole, if the amount of such
judgment or decree exceeds $25,000,000, in each case,
after deducting the amount with respect to which TCC,
Tandy or such other Subsidiaries is insured and with
respect to which the insurer has assumed responsibility
in writing;
(b) Suits and Proceedings. The filing or
commencement of any action, suit or proceeding, whether
at law or in equity or by or before any court or any
federal, state, municipal or other governmental agency
or authority as to which there is a reasonable
possibility of an adverse determination and which, if
adversely determined, could materially impair the right
of either Borrower or its Significant Subsidiaries to
carry on business substantially as then conducted or
materially and adversely affect the business, assets,
operations, prospects or condition (financial or
otherwise) of either Borrower or any of its Significant
Subsidiaries;
(c) Default. The occurrence of any Event of
Default or Default;
(d) Material Adverse Change. The occurrence of a
material adverse change in the business, operations or
condition (financial or otherwise) of either Borrower
and its Significant Subsidiaries, taken as a whole;
(e) Pension and Welfare Plans. The occurrence of
a Reportable Event with respect to any Plan; the
institution of any steps by either Borrower, any of its
Subsidiaries or any ERISA Affiliate, the PBGC or any
other Person to terminate any Plan; the institution of
any steps by either Borrower, or any of its Subsidiaries
or any ERISA Affiliate to withdraw from any Plan; or the
incurrence of any material increase in the contingent
liability of either Borrower or any of its Subsidiaries
with respect to any post-retirement welfare benefits;
and
(f) Other Events. The occurrence of such other
events as the Agents or the Required Banks may
reasonably from time to time specify.
SECTION 5.07. ERISA. Each Borrower will comply, and
Tandy will cause each of its other Subsidiaries to comply, in
all material respects with the applicable provisions of
ERISA.
SECTION 5.08. Books, Records and Access. Each Borrower
will maintain, and will cause each of its Significant
Subsidiaries to maintain, complete and accurate books and
records in which full and correct entries in conformity with
generally accepted accounting principles shall be made of all
dealings and transactions in relation to the business and
activities of each Borrower and such Significant
Subsidiaries. Each Borrower will permit, and will cause each
of its Significant Subsidiaries to permit, reasonable access
by the Agents and each Bank, upon reasonable request, to the
books and records relating to each Borrower and its
Significant Subsidiaries during normal business hours, to
permit or cause to be permitted, the Agents and each Bank to
make extracts from such books and records and permit, or
cause to be permitted, upon reasonable request, any
authorized representative designated by any Bank to discuss
the affairs, finances and condition of either Borrower or any
of its Significant Subsidiaries with such Person's principal
financial officers and principal accounting officers and such
other officers as either Borrower shall deem appropriate.
SECTION 5.09. Use of Proceeds. Tandy will use the
proceeds of the Loans only for general corporate purposes
including the repayment of its commercial paper maturing from
time to time. TCC will use the proceeds of its Loans only to
repay its commercial paper maturing from time to time and
will use the proceeds of such commercial paper only (i) to
finance credit card or installment contract sales of Radio
Shack and Tandy Name Brand Divisions and (ii) to repay
Permitted Indebtedness.
SECTION 5.10. Operating Agreement; Support Agreement.
Each Borrower will perform, observe and comply with each of
its covenants and agreements in the Operating Agreement and
the Support Agreement, do or cause to be done all things
necessary to keep the Operating Agreement and the Support
Agreement in full force and effect and the rights of the
Borrowers thereunder unimpaired.
SECTION 5.11. Nature of Business. Each Borrower will
engage in, and will cause each of its other Significant
Subsidiaries to engage in, substantially the same field of
business as they are engaged in on the date hereof.
SECTION 5.12. Compliance. Each Borrower will comply,
and will cause each of its Subsidiaries to comply, in all
material respects with all statutes and governmental rules
and regulations applicable to it including all such statutes
and government rules and regulations relating to
environmental pollution or to environmental regulation and
control.
ARTICLE VI
NEGATIVE COVENANTS
So long as this Agreement shall remain in effect or the
principal of or interest on any Note, any Commitment Fee or
any other expense or amount payable hereunder shall be unpaid
and until the Commitments of the Banks shall expire or
terminate, unless the Required Banks shall otherwise consent
in writing, the Borrowers covenant and agree with each Bank
that:
SECTION 6.01. Liens. The Borrowers will not, and will
not permit any of their respective Subsidiaries to, incur,
create, assume or permit to exist any Lien on any of its
property or assets, whether owned at the date hereof or
hereafter acquired, or assign or convey any rights to or
security interests in any future revenues, except:
(a) Liens in connection with the acquisition by
Tandy or such Subsidiary (other than TCC) of property
after the date hereof by way of purchase money,
mortgage, conditional sale or other title retention
agreement, capitalized lease or other deferred payment
contract, and attaching only to the property being
acquired, if the Indebtedness secured thereby does not
exceed 80% (100% in the case of a capitalized lease) of
the fair market value of such property at the time of
acquisition thereof nor $100,000,000 in the aggregate
for Tandy and all Subsidiaries at any one time
outstanding; (b) Liens referred to in Section 3.18;
(c) Other Liens securing obligations of Tandy and
its Subsidiaries (other than TCC and TRC) not to exceed
$50,000,000 in the aggregate and attaching to property
of Tandy or such other Subsidiary whose aggregate fair
market value does not exceed $50,000,000; and
(d) extensions, renewals and replacements of liens
referred to in paragraphs (a) through (d) of this
Section 6.01; provided, that any such extension, renewal
or replacement lien shall be limited to the property or
assets covered by the Lien extended, renewed or replaced
and that the obligations secured by any such extension,
renewal or replacement lien shall be in an amount not
greater than the amount of the obligations secured by
the Lien extended, renewed or replaced.
SECTION 6.02. Sale and Leaseback Transactions. TCC
will not enter into any arrangement, directly or indirectly,
with any person whereby TCC shall sell or transfer any real
or personal property, used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease
such property which TCC intends to use for substantially the
same purpose or purposes as the property being sold or
transferred, without the prior written consent of the
Required Banks.
SECTION 6.03. Merger, Purchase and Sale. The Borrowers
will not, and will not permit any of their respective
Subsidiaries, to:
(a) be a party to any merger or consolidation;
(b) sell, transfer, convey, lease or otherwise
dispose of all or any substantial part of its assets;
(c) sell or assign, with or without recourse, any
accounts receivable or chattel paper; or
(d) purchase or otherwise acquire all or
substantially all the assets of any Person.
Notwithstanding the foregoing:
(u) TCC may sell all or substantially all of its
Accounts (including "Customer Obligations" as defined in
the Operating Agreement) for reasonably equivalent value
to TRC;
(v) TRC may transfer and assign all of its right,
title and interest in its credit card receivables to
the Tandy Master Trust pursuant to one or more pooling
and servicing agreements;
(w) any Subsidiary (other than TCC) may merge into
Tandy or into or with any Wholly-owned Subsidiary so
long as Tandy or such Wholly-owned Subsidiary, as the
case may be, shall be the surviving entity, provided,
however, TRC may not merge into TCC;
(x) any Subsidiary (other than TCC) may sell,
transfer, convey, lease or assign all or a substantial
part of its assets to Tandy or any Wholly-owned
Subsidiary;
(y) any Person (other than TCC) may merge into
Tandy and Tandy may acquire all or substantially all the
assets of any Person; and
(z) Tandy and any of its Subsidiaries (other than
TCC) may in the ordinary course of its business sell,
transfer, convey, lease or otherwise dispose of all or
any substantial part of the assets of Tandy and its
Subsidiaries taken as a whole;
provided, in each of the cases described in the preceding
clauses (u), (v), (w), (x), (y) and (z), that immediately
thereafter and after giving effect thereto:
(i) no Event of Default or Default shall have
occurred and be continuing;
(ii) Tandy is a surviving entity;
(iii) the surviving officers of Tandy shall be
substantially the same; and
(iv) Tandy shall at all times own 100% of the
issued and outstanding stock of TCC.
For purposes of this Section 6.03 only, a sale,
transfer, conveyance, lease or other disposition of assets
shall be deemed to be a "substantial part" of the assets of
Tandy and its Subsidiaries only if the value of such assets,
when added to the value of all other assets sold,
transferred, conveyed, leased or otherwise disposed of by
Tandy and its Subsidiaries (other than (i) pursuant to
clauses (x) and (z) of this Section 6.03) during the same
fiscal year, exceeds 15% of Tandy's consolidated total assets
determined as of the end of the immediately preceding fiscal
year. As used in the preceding sentence, the term "value"
shall mean, with respect to any asset disposed of, the
greater of such asset's book or fair market value as of the
date of disposition, with "book value" being the value of
such asset as would appear immediately prior to such
disposition on a balance sheet of the owner of such asset
prepared in accordance with generally accepted accounting
principles.
SECTION 6.04. Disposition of Accounts. TCC will not
sell, transfer, discount or otherwise dispose of any Accounts
unless such sale or other disposition shall be without
recourse to TCC except (a) to the extent of breaches of
customary representations and warranties on sale that do not
relate in any way to creditworthiness of any obligor on such
receivables or the collectibility or payment thereof, (b) as
permitted by the Operating Agreement and (c) as permitted by
Section 6.03.
SECTION 6.05. Stockholders' Equity of TCC. TCC will
not permit (a) its Stockholders' Equity less (b) the sum of
(i) all Indebtedness owed by TRC to TCC plus (ii) the value
of all Investments of TCC in TRC to be less at any time than
15% of the aggregate principal amount of its Indebtedness.
SECTION 6.06. Indebtedness. TCC will not incur,
create, assume or permit to exist any Indebtedness other than
Permitted Indebtedness.
SECTION 6.07. Investments. The Borrowers will not, and
will not permit any of their respective Subsidiaries to, make
or permit to exist any Investment in any Person, except for:
(a) loans or advances constituting Indebtedness of
Subsidiaries (other than TCC and TRC) to Tandy and to
Wholly-owned Subsidiaries, Permitted Indebtedness of TCC
to Tandy; provided, however, TCC may not make any
Investment in Tandy or any Subsidiary of Tandy;
(b) extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale of
goods and services in the ordinary course of business;
(c) shares of stock, obligations or other
securities received in settlement of claims arising in
the ordinary course of business;
(d) Investments in securities maturing within two
years issued or fully guaranteed or insured by the
United States of America or any agency thereof;
(e) Investments in commercial paper maturing in
270 days or less from the date of issuance rated in the
highest or second highest grade by a nationally
recognized credit rating agency;
(f) Investments in United States dollar
denominated time deposits maturing within two years
issued by a bank or trust company having capital,
surplus and undivided profits aggregating at least
500,000,000;
(g) Investments (other than Investments in the
nature of loans or advances) outstanding on the date
hereof in Subsidiaries by Tandy and its Subsidiaries
(other than TCC);
(h) other Investments outstanding on the date
hereof and listed on Exhibit 6.07;
(i) other Investments of Tandy and its
Subsidiaries (other than TCC) not exceeding 7.5% of
Consolidated Tangible Net Worth at any time;
(j) Investments of TCC in Accounts;
(k) Investments of TCC in TRC arising from the
transfer by TCC of Accounts to TRC pursuant to clause
(u) of Section 6.03;
(l) Investments of TRC in the Tandy Master Trust
pursuant to the transactions permitted by clause (v) of
Section 6.03; and
(m) endorsements of negotiable instruments for
deposit or collection in the ordinary course of
business.
SECTION 6.08. Capital Stock. TCC will not issue, sell,
or otherwise dispose of any shares of its capital stock or
any securities convertible into or exchangeable for any such
shares, or any warrants, options, or other rights to
subscribe for or purchase any such shares, other than the
issuance by TCC of additional shares of its capital stock to
Tandy pursuant to Section 6.14.
SECTION 6.09. Transactions with Affiliates. Neither
Borrower will enter into any transaction with any Affiliate
except in the ordinary course of business and upon fair and
reasonable terms no less favorable than such Borrower could
obtain or could become entitled to in an arm s-length
transaction with a person or entity which was not an
Affiliate; provided, however, this Section 6.09 shall not
apply to the purchase of, and payment for, Accounts by TCC
pursuant to the terms and conditions of the Operating
Agreement.
SECTION 6.10. Amendments and Modifications of the
Operating Agreement and Support Agreement. Neither Borrower
will assign, amend, alter the terms of, or surrender, cancel,
or terminate, or permit any such assignment, amendment,
alteration, surrender, cancellation or termination, of the
Operating Agreement or the Support Agreement without the
concurrence of the Required Banks, notwithstanding anything
in either the Operating Agreement or the Support Agreement to
the contrary.
SECTION 6.11. Other Agreements. The Borrowers will
not, and will not permit any of their respective Subsidiaries
to, enter into any agreement containing any provision which
would be violated or breached by such Borrower's performance
of its obligations hereunder or under any instrument or
document delivered or to be delivered by such Borrower
hereunder or in connection herewith.
SECTION 6.12. Fiscal Year; Accounting. Neither
Borrower will change its fiscal year or method of accounting
(other than immaterial changes and methods and changes
authorized by generally accepted accounting principles).
SECTION 6.13. Credit Standards. Neither Tandy nor TCC
will modify in any way the credit standards and procedures,
the collection policies or the loss recognition procedures
with respect to the creation or collection of Accounts if the
modification would have a material adverse effect on the
financial condition of TCC or Tandy.
SECTION 6.14. Dividends. Neither TCC nor TRC will
declare or pay, directly or indirectly, any dividends (other
than in shares of its common stock) or make any other
distribution, whether in cash, property, securities or a
combination thereof, with respect to (whether by reduction of
capital or otherwise) any shares of capital stock, or
directly or indirectly redeem, purchase, retire or otherwise
acquire for consideration, any shares of any class of capital
stock, or set apart any sum for the aforesaid purposes,
except that TRC may pay cash dividends to TCC and, so long as
there shall not have occurred any Event of Default or any
Default after giving effect thereto, TCC may pay cash
dividends to Tandy.
SECTION 6.15 Pension Plans. The Borrowers will not
permit, and will not permit any of their respective
Subsidiaries to permit, any condition to exist in connection
with any Plan which might constitute grounds for the PBGC to
institute proceedings to have such Plan terminated or a
trustee appointed to administer such Plan, and not engage in,
or permit to exist or occur, and will not permit any of their
respective Subsidiaries to engage in, or permit to exist or
occur, any other condition, event or transaction with respect
to any Plan which could result in the incurrence by either
Borrower or any such Subsidiary of any material liability,
fine or penalty.
SECTION 6.16. Senior Indebtedness to Tangible Net Worth
Ratio. Tandy will not permit the ratio of its Consolidated
Senior Indebtedness to its Consolidated Tangible Net Worth to
exceed 1.0 to 1.0.
SECTION 6.17. Tangible Net Worth of Tandy. Tandy will
not permit its Consolidated Tangible Net Worth to be less
than $1,000,000,000.
SECTION 6.18. Guaranties. The Borrowers will not, and
will not permit any of their respective Subsidiaries to,
become or be liable under any Guaranty except Guaranties (a)
which (x) in the case of Guaranties of Indebtedness for
borrowed money, guarantee Indebtedness with a maximum
principal amount, and (y) in all other cases are limited in
amount to a stated maximum dollar exposure, (b) which are
included in Indebtedness, and (c) which are:
(i) Guaranties by Tandy or a Wholly-owned
Subsidiary (other than TCC and TRC) of the Indebtedness
of a Subsidiary of Tandy;
(ii) Guaranties by a Subsidiary of Tandy (other
than TCC and TRC) of Indebtedness of Tandy;
(iii) Guaranties by Tandy of $100,000,000 9.34%
TESOP Notes due June 30, 2000 issued by the plan trustee
to fund the Tandy Employee Stock Ownership Plan; or
(iv) other Guaranties of Indebtedness not
exceeding $50,000,000 in aggregate principal amount at
any time outstanding, and, in the case of TCC, which are
permitted by Section 6.06.
SECTION 6.19. Leases. The Borrowers will not at any
time enter into or permit to exist, and will not permit any
of their respective Subsidiaries to enter into or permit to
exist, any arrangements for the leasing by either Borrower or
any of its Subsidiaries, as lessee, of any real or personal
property (or any interest therein) under leases (other than
capitalized leases); provided, however, the Borrowers and
their respective Subsidiaries (other than TCC) may enter into
and permit to exist such leases which require the payment by
Tandy and such Subsidiaries on a consolidated basis of
minimum rental amounts in the aggregate in any one fiscal
year not in excess of 25% of Consolidated Tangible Net Worth
as of the end of the fiscal year preceding such time.
SECTION 6.20. Certificate of Incorporation of TRC. The
Borrowers will not permit the Restated Certificate of
Incorporation of TRC to be amended without the prior written
consent of the Required Banks if the affect of such amendment
would materially and adversely affect the Banks; provided,
however, so long as the Tandy Guaranty shall be in full force
and effect, the Borrowers shall not be required to comply
with the provisions of this Section 6.20.
ARTICLE VII
EVENTS OF DEFAULT
SECTION 7.01. Events of Default. In case of the
happening of any of the following events (herein called
"Events of Default"):
(a) any representation or warranty made or deemed
made in or in connection with this Agreement, the
Operating Agreement, the Support Agreement or the Notes
or the Borrowings hereunder or in any report,
certificate, financial statement or other instrument
furnished in connection with this Agreement, the
Operating Agreement, the Support Agreement or the
execution and delivery of the Notes or the Borrowings
hereunder shall prove to have been false or misleading
in any material respect when made or deemed made;
(b) default shall be made in the payment of any
principal of, or any installment of principal of, any Note
when and as the same shall become due and payable,
whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or
otherwise;
(c) default shall be made in the payment of any
interest on any Note or any Commitment Fee or any other
amount due under this Agreement, when and as the same
shall become due and payable, and such default shall
continue unremedied for a period of five days;
(d) default shall be made in the due observance or
performance of any covenant, condition or agreement
contained in Sections 5.01, 5.05 or 5.06 or Article VI;
provided, however, that no Event of Default shall be
deemed to have occurred by reason of any noncompliance
with Section 6.05 if Tandy shall promptly, and in any
event within 30 days after the last Business Day of the
calendar month most recently elapsed at the time such
noncompliance is discovered by the Borrowers furnish to
the Administrative Agent in sufficient counterparts for
each Bank (i) a guaranty in substantially the form of
Exhibit 7.01 (the "Tandy Guaranty") duly executed by
Tandy, (ii) a copy of a resolution of the board of
directors of Tandy, authorizingthe Tandy Guaranty, which
copy shall be certified to be a true and complete copy
by the Secretary or Assistant Secretary of Tandy and
(iii) an opinion of counsel for Tandy in form and
substance satisfactory to the Administrative Agent to
the effect that the Tandy Guaranty has been duly
authorized, executed and delivered on behalf of Tandy
and constitutes the legal, valid and binding obligation
of Tandy enforceable against Tandy in accordance with
its terms; further provided that so long as the Tandy
Guaranty shall be in full force and effect, no Event of
Default shall be deemed to have occurred by reason of
any noncompliance with Section 6.05;
(e) default shall be made in the due observance or
performance of any other covenant, condition or
agreement to be observed or performed pursuant to this
Agreement, the Operating Agreement, the Support
Agreement or the Tandy Guaranty, if delivered, and such
default shall continue unremedied for 15 days;
(f) either Borrower or any of its Subsidiaries
(other than an Insignificant Foreign Subsidiary) shall
(i) voluntarily commence any proceeding or file any
petition seeking relief under Title 11 of the United
States Code or any other federal or state bankruptcy,
insolvency, liquidation or similar law, (ii) consent to
the institution of, or fail to contravene in a timely
and appropriate manner, any such proceeding or the
filing of any such petition, (iii) apply for or consent
to the appointment of a receiver, trustee, custodian,
sequestrator or similar official for such Borrower or
such Subsidiary or for a substantial part of either such
Borrower's or such Subsidiary's property or assets, (iv)
file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v)
make a general assignment for the benefit of creditors,
(vi) become unable, admit in writing its inability or
fail generally to pay its debts as they become due or
(vii) take any corporate or other action for the purpose
of effecting any of the foregoing;
(g) an involuntary proceeding shall be commenced
or an involuntary petition shall be filed in a court of
competent jurisdiction seeking (i) relief in respect of
either Borrower or any of its Subsidiaries (other than
an Insignificant Foreign Subsidiary), or of a
substantial part of the property or assets of such
Borrower or such Subsidiary, under Title 11 of the
United States Code or any other federal or state
bankruptcy, insolvency, receivership or similar law,
(ii) the appointment of a receiver, trustee, custodian,
sequestrator or similar official for such Borrower or
such Subsidiary or for a substantial part of the
property of such Borrower or such Subsidiary or (iii)
the winding-up or liquidation of such Borrower or such
Subsidiary; and such proceeding or petition shall
continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall
continue unstayed and in effect for 60 days;
(h) default or defaults (other than defaults in
the payment of principal or interest) shall be made with
respect to any Indebtedness of either Borrower, if the
total Indebtedness in default exceeds in the aggregate
for both Borrowers an amount equal to $50,000,000 and if
the effect of such default or defaults shall be to
accelerate, or to permit the holder or obligee of any
Indebtedness (or any trustee on behalf of such holder or
obligee) to accelerate (with or without notice or lapse
of time or both), the maturity of any Indebtedness; or
any payment of principal or interest, regardless of
amount, on any Indebtedness of either Borrower shall not
be paid when due, whether at maturity, by acceleration
or otherwise (after giving effect to any period of grace
as specified in the instrument evidencing or governing
such Indebtedness);
(i) Tandy shall cease legally and beneficially to
own all the issued and outstanding capital stock of TCC;
(j) A Change of Control shall occur;
(k) a Reportable Event or Reportable Events shall
have occurred with respect to any Plan or Plans that
reasonably could be expected to result in liability of
either Borrower to the PBGC in an aggregate amount in
excess of $1,000,000 and within 30 days after the
reporting of such Reportable Event or Reportable Events
to the Banks the Agents shall have notified such
Borrower in writing that (i) it has determined that on
the basis of such Reportable Event or Reportable Events
there are reasonable grounds for termination of the Plan
by the PBGC or for the appointment by the appropriate
United States District Court of a trustee to administer
such Plan and (ii) as a result of such determination, an
Event of Default exists hereunder; or the PBGC shall
have instituted proceedings to terminate any Plan or
Plans, or a trustee shall have been appointed by a
United States District Court to administer any Plan or
Plans, with vested unfunded liabilities aggregating in
excess of $1,000,000; or
(l) there shall be entered against either Borrower
or any other Subsidiary of Tandy one or more judgments
or decrees in excess of $50,000,000 in the aggregate at
any one time outstanding for the Borrowers and all such
Subsidiaries and all such judgments or decrees shall
not have been vacated, discharged, stayed or bonded
pending appeal within 30 days from the entry thereof,
excluding those judgments or decrees for and to the
extent which the Borrowers or any such Subsidiary is
insured and with respect to which the insurer has
assumed responsibility in writing or for and to the
extent which the Borrowers or any such Subsidiary is
otherwise indemnified if the terms of such
indemnification are satisfactory to the Required Banks;
then, and in any such event (other than an event with respect
to either Borrower described in paragraph (f) or (g) above),
and at any time thereafter during the continuance of such
event, the Administrative Agent may, and at the request of
the Required Banks shall, by written or telegraphic notice to
the Borrowers, take either or both of the following actions
at the same or different times: (i) terminate forthwith the
Commitments of the Banks hereunder (if not theretofore
terminated) and (ii) declare the Notes then outstanding to be
forthwith due and payable, whereupon the principal of the
Notes, together with accrued interest thereon and any unpaid
accrued Commitment Fees and all other liabilities of the
Borrowers accrued hereunder, shall become forthwith due and
payable both as to principal and interest, without
presentment, demand, protest, notice of protest, notice of
intent to accelerate, notice of acceleration or any other
notice of any kind, all of which are hereby expressly waived
by the Borrowers, anything contained herein or in any Note or
other Loan Document to the contrary notwithstanding; and in
any event with respect to either Borrower described in
paragraph (f) or (g) above, the Commitments of the Banks
shall automatically terminate (if not theretofore terminated)
and the Notes shall automatically become due and payable,
both as to principal and interest, without presentment,
demand, protest, notice of intent to accelerate, notice of
acceleration or other notice of any kind, all of which are
hereby expressly waived by the Borrowers, anything contained
herein or in any Note to the contrary notwithstanding.
ARTICLE VIII
THE AGENTS
SECTION 8.01. Authorization and Action. In order to
expedite the various transactions contemplated by this
Agreement, each Bank hereby irrevocably appoints and
authorizes TCB-Dallas to act as Administrative Agent and TCB
to act as Funds Administrator on its behalf. Each of the
Banks, and each subsequent holder of any Note by its
acceptance thereof, hereby irrevocably authorizes and directs
the Agents to take such action on behalf of such Bank or
holder under the terms and provisions of this Agreement and
to exercise such powers hereunder as are specifically
delegated to or required of the Agents by the terms and
provisions hereof, together with such powers as are
reasonably incidental thereto. The Agents are hereby
expressly authorized on behalf of the Banks, without hereby
limiting any implied authority, (a) to receive on behalf of
each of the Banks any payment of principal of or interest on
the Notes outstanding hereunder and all other amounts accrued
hereunder paid to the Agents, and promptly to distribute to
each Bank its proper share of all payments so received; (b)
to give notice within a reasonable time on behalf of each of
the Banks to the Borrowers of any Default or Event of Default
specified in this Agreement of which the Agents have actual
knowledge as provided in Section 8.08; (c) to distribute to
each Bank copies of all notices, agreements and other
material as provided for in this Agreement as received by
such Agents; and (d) to distribute to the Borrowers any and
all requests, demands and approvals received by the Agents or
from the Banks.
SECTION 8.02. Agent's Reliance, etc. Neither the
Administrative Agent, the Funds Administrator nor any of its
directors, officers, employees or agents shall be liable as
such for any action taken or omitted by any of them hereunder
except for its or his own gross negligence or willful
misconduct (it being the express intention of the parties
that the Administrative Agent and the Funds Administrator and
their respective directors, officers, employees and agents
shall have no liability for actions and omissions hereunder
resulting from their ordinary sole or contributory
negligence), or be responsible for any statement, warranty or
representation herein or the contents of any document
delivered in connection herewith or be required to ascertain
or to make any inquiry concerning the performance or
observance by the Borrowers of any of the terms, conditions,
covenants or agreements of this Agreement or any other Loan
Document. Neither Agent shall be responsible to the Banks or
the holders of the Notes for the due execution, genuineness,
validity, enforceability or effectiveness of this Agreement,
the Notes, any other Loan Document or any other instrument to
which reference is made herein. The Agents may deem and
treat the payee of any Note as the owner thereof for all
purposes hereof until it shall have received from the payee
of such Note notice, given as provided herein, of the
transfer thereof. The Agents shall in all cases be fully
protected in acting, or refraining from acting, in accordance
with written instructions signed by the Required Banks, and,
except as otherwise specifically provided herein, such
instructions and any action taken or failure to act pursuant
thereto shall be binding on all the Banks. The Agents shall,
in the absence of knowledge to the contrary, be entitled to
rely on any paper or document believed by them in good faith
to be genuine and correct and to have been signed or sent by
the proper person or persons. Neither Agent nor any of its
directors, officers, employees or agents shall have any
responsibility to the Borrowers on account of the failure or
delay in performance or breach by any Bank of any of its
obligations hereunder or to any Bank on account of the
failure of or delay in performance or breach by any other
Bank or the Borrowers of any of their respective obligations
hereunder or in connection herewith. The Agents may execute
any and all duties hereunder by or through agents or
employees and shall be entitled to advice of legal counsel
selected by it with respect to all matters arising hereunder
and shall not be liable for any action taken or suffered in
good faith by it in accordance with the advice of such
counsel.
The Banks hereby acknowledge that the Agents shall be
under no duty to take any discretionary action permitted to
be taken by it pursuant to the provisions of this Agreement
unless an Agent shall be requested in writing to do so by the
Required Banks.
SECTION 8.03. Agent and Affiliates: TCB, TCB-Dallas and
Affiliates. Without limiting the right of any other Bank to
engage in any business transactions with either Borrower or
any of its Affiliates, with respect to their Commitments, the
Loans, if any, made by them and the Notes, if any, issued to
them, TCB-Dallas and, to the extent it becomes the holder of
any Note hereunder, TCB shall have the same rights and powers
under this Agreement, any Note or any of the other Loan
Documents as any other Bank and may exercise the same as
though it were not respectively the Administrative Agent and
the Funds Administrator; and the term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include
TCB-Dallas and, to the extent TCB becomes the holder of any
Note, TCB, in its individual capacity. TCB, TCB-Dallas and
their respective Affiliates may be engaged in, or may
hereafter engage in, one or more loan, letter of credit,
leasing or other financing activities not the subject of the
Loan Documents (collectively, the "Other Financings") with
either Borrower or any of its Affiliates, or may act as
trustee on behalf of, or depositary for, or otherwise engage
in other business transactions with either Borrower or any of
its Affiliates (all Other Financings and other such business
transactions being collectively, the "Other Activities") with
no responsibility to account therefor to the Banks. Without
limiting the rights and remedies of the Banks specifically
set forth in the Loan Documents, no other Bank shall have any
interest in (a) any Other Activities, (b) any present or
future guarantee by or for the account of either Borrower not
contemplated or included in the Loan Documents, (c) any
present or future offset exercised by either Agent in respect
of any such Other Activities, (d) any present or future
property taken as security for any such Other Activities or
(e) any property now or hereafter in the possession or
control of either Agent which may be or become security for
the obligations of either Borrower under the Loan Documents
by reason of the general description of indebtedness secured,
or of property contained in any other agreements, documents
or instruments related to such Other Activities; provided,
however, that if any payment in respect of such guarantees or
such property or the proceeds thereof shall be applied to
reduction of the obligations evidenced hereunder and by the
Notes, then each Bank shall be entitled to share in such
application according to its pro rata portion of such
obligations.
SECTION 8.04. Agents Indemnity. Each Bank agrees (a)
to reimburse the Agents, on demand, in the amount of such
Bank's pro rata share (based on its Commitments hereunder) of
any expenses incurred for the benefit of the Banks by either
Agent, including counsel fees and compensation of agents and
employees paid for services rendered on behalf of the Banks,
not reimbursed by the Borrowers and (b) to indemnify and hold
harmless each Agent and any of its directors, officers,
employees or agents, on demand, in the amount of its pro rata
share, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever
which may be imposed on, incurred by, asserted against such
Agent in its capacity as an Agent or any of them in any way
relating to or arising out of this Agreement or any action
taken or omitted by such Agent or any of them under this
Agreement, to the extent not reimbursed by the Borrowers;
provided, however, that no Bank shall be liable to an Agent
for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence
or willful misconduct of such Agent or any of its directors,
officers, employees or agents. Each Bank agrees, however,
that it expressly intends, under this Section 8.04, to
indemnify each Agent as aforesaid for all such liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses and disbursements resulting from such
Agent's ordinary sole or contributory negligence.
SECTION 8.05. Bank Credit Decision. Each Bank
acknowledges that it has, independently and without reliance
upon either Agent or any other Bank and based on such
documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will,
independently and without reliance upon either Agent or any
other Bank and based on such documents and information as it
shall deem appropriate at the time, continue to make its own
decisions in taking or not taking action under or based upon
this Agreement, the other Loan Documents, any related
agreement or any document furnished hereunder.
SECTION 8.06. Successor Administrative Agent. Subject
to the appointment and acceptance of a successor
Administrative Agent as provided herein, the Administrative
Agent may resign at any time by giving written notice thereof
to the Funds Administrator, the Banks and the Borrowers.
Upon any such resignation, the Required Banks shall have the
right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed
by the Required Banks, and shall have accepted such
appointment, within 30 calendar days after the retiring
Administrative Agent's giving of notice of resignation, then
the retiring Administrative Agent may, on behalf of the
Banks, appoint a successor Administrative Agent, which shall
be a commercial bank organized or licensed under the laws of
the United States or of any state thereof and having a
combined capital and surplus of at least $500,000,000. Upon
the acceptance of any appointment as Administrative Agent
hereunder and under the Notes by a successor Administrative
Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged
from its duties and obligations under this Agreement and the
Notes. After any retiring Administrative Agent's resignation
as Administrative Agent hereunder and under the Notes, the
provisions of this Article VIII and Section 9.04 shall inure
to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement
and the Notes.
SECTION 8.07. Successor Funds Administrator. Subject
to the appointment and acceptance of a successor Funds
Administrator as provided herein, the Funds Administrator may
resign at any time by giving written notice thereof to the
Administrative Agent, the Banks and the Borrowers. Upon any
such resignation, the Required Banks shall have the right to
appoint a successor Funds Administrator. If no successor
Funds Administrator shall have been so appointed by the
Required Banks, and shall have accepted such appointment,
within 30 calendar days after the retiring Funds
Administrator's giving of notice of resignation, then the
retiring Funds Administrator may, on behalf of the Banks,
appoint a successor Funds Administrator, which shall be a
commercial bank organized or licensed under the laws of the
United States or of any state thereof and having a combined
capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Funds Administrator
hereunder and under the Notes by a successor Funds
Administrator, such successor Funds Administrator shall
thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Funds
Administrator, and the retiring Funds Administrator shall be
discharged from its duties and obligations under this
Agreement and the Notes. After any retiring Funds
Administrator's resignation as Funds Administrator hereunder
and under the Notes, the provisions of this Article VIII and
Section 9.04 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Funds
Administrator under this Agreement and the Notes.
SECTION 8.08. Notice of Default. Neither Agent shall
be deemed to have knowledge or notice of the occurrence of
any Default or Event of Default hereunder unless such Agent
shall have received notice from a Bank or a Borrower
referring to this Agreement, describing such Default or Event
of Default and stating that such notice is a "notice of
default" or "notice of event of default", as applicable. If
an Agent receives such a notice, such Agent shall give notice
thereof to the Banks and, if such notice is received from a
Bank, such Agent shall give notice thereof to the other
Agent, the other Banks and the Borrowers. The Agent shall be
entitled to take action or refrain from taking action with
respect to such Default or Event of Default as provided in
Section 8.01 and Section 8.02.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All Notices, consents,
requests, approvals, demands and other communications
(collectively, "Communications") provided for herein shall be
in writing (including telecopy or telegraphic Communications)
and shall be delivered by hand or overnight courier service,
mailed or sent by telex, graphic scanning or other
telegraphic communications equipment addressed:
(a) if to Tandy, at 1700 One Tandy Center, Fort
Worth, Texas 76102, Attention of Dwain H. Hughes,
Assistant Treasurer (Telecopy No. (817) 390-2638);
(b) if to TCC, at 1700 One Tandy Center, Fort
Worth, Texas 76102, Attention of Dwain H. Hughes,
Assistant Treasurer (Telecopy No. (817) 390-2638);
(c) if to the Administrative Agent, at One Tandy
Center, Fort Worth, Texas 76102, Attention of Richard
Barajas, Vice President (Telecopy No. (817) 878-7591);
(d) if to the Funds Administrator, at 712 Main
Street, Houston, Texas 77002, Attention of Susan
Cummins, Investment Officer (Telecopy No. (713)
546-2339); and
(e) if to any Bank, at its address set forth on
Schedule I attached hereto or in the Assignment and
Acceptance pursuant to which such Bank became a party
hereto.
All Communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have
been given on the date of receipt if delivered by hand or
overnight courier service or sent by telex, telecopy or other
telegraphic communications equipment of the sender, or on the
date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or
mailed (properly addressed) to such party as provided in this
Section 9.01 or in accordance with the latest unrevoked
direction from such party given in accordance with this
Section 9.01.
SECTION 9.02. Survival of Agreement. All covenants,
agreements, representations and warranties made by the
Borrowers herein and in the other Loan Documents and in the
certificates or other instruments prepared or delivered in
connection with this Agreement shall be considered to have
been relied upon by the Banks and shall survive the making by
the Banks of the Loans and the execution and delivery to the
Banks of the Notes evidencing such Loans and shall continue
in full force and effect as long as the principal of or any
accrued interest on any Note or any Commitment Fee or any
other fee or amount payable under the Notes or this Agreement
is outstanding and unpaid and so long as the Commitments have
not been terminated.
SECTION 9.03. Successors and Assigns; Participations.
(a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the
successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Borrowers, the
Agents or the Banks that are contained in this Agreement
shall bind and inure to the benefit of their respective
successors and assigns. The Borrowers may not assign or
transfer any of their respective rights or obligations
hereunder without the prior written consent of all the Banks.
(b) Each Bank may assign to one or more Eligible
Assignees a portion (but not all) of its interests, rights
and obligations under this Agreement (including a portion of
its Commitments with respect to both Tranches and the same
portion of the Loans of its Tranches at the time owing to it
and the Notes held by it); provided, however, that (i) except
in the case of an assignment to a Bank or an Affiliate of a
Bank, the Borrowers and the Agents must give their prior
written consent by countersigning the Assignment and
Acceptance (which consent shall not be unreasonably
withheld), (ii) each such assignment shall be of a constant,
and not a varying, percentage of all the assigning Bank's
rights and obligations to this Agreement, (iii) the amount of
the Commitments of the assigning Bank of each Tranche subject
to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is
delivered to the Funds Administrator) shall in no event be
less than $10,000,000 and shall be in an amount which is an
integral multiple of $1,000,000, (iv) the parties to each
such assignment shall execute and deliver to the Funds
Administrator, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any
Notes subject to such assignment and a processing and
recordation fee of $2,000, and (v) the assignee shall deliver
to the Agents an Administrative Questionnaire. Upon such
execution, delivery, acceptance and recording, from and after
the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five
Business Days after the execution thereof, (x) the assignee
thereunder shall be a party hereto and, to the extent
provided in such Assignment and Acceptance, have the rights
and obligations of a Bank hereunder and (y) the Bank
thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.
(c) By executing and delivering an Assignment and
Acceptance, the assigning Bank thereunder and the assignee
thereunder confirm to and agree with each other and the other
parties hereto as follows: (i) other than the representation
and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse
claim, such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in
connection with the Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value
of this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto; (ii) such
assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial
condition of the Borrowers or the performance or observance
by the Borrowers of any of their respective obligations under
this Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto;
(iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial
statements referred to in Section 3.05 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 either Agent, such
Bank's assignor or any other Bank and based on such documents
and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not
taking action under this Agreement; (v) such assignee
confirms that it is an Eligible Assignee; (vi) such assignee
appoints and authorizes each Agent to take such action as
agent on its behalf and to exercise such powers under this
Agreement as are delegated to such Agent 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 Bank.
(d) The Funds Administrator shall maintain at its
address referred to in Section 9.01 a copy of each Assignment
and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Banks and the
Commitments of, and principal amount of the Loans owing to,
each Bank from time to time (the "Register"). The entries in
the Register shall be conclusive, in the absence of
demonstrable error, and the Borrowers, the Administrative
Agent and the Banks may treat each Person whose name is
recorded in the Register as a Bank hereunder for all purposes
of this Agreement. The Register shall be available for
inspection by the Borrowers, the Administrative Agent or any
Bank at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and
Acceptance executed by an assigning Bank and an Eligible
Assignee together with the Notes subject to such assignment,
the processing and recordation fee referred to in paragraph
(b) above and, if required, the Borrowers written consent to
such assignment, the Funds Administrator shall (subject to
the consent of the Agents to such assignment, if required),
if such Assignment and Acceptance has been completed and is
in the form of Exhibit 1.01-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 Borrowers, the Banks and the
Administrative Agent. Within five Business Days after
receipt of notice, the Borrowers, at their own expense, shall
execute and deliver to the Funds Administrator in exchange
for the surrendered Notes a new Tranche A Note to the order
of such Eligible Assignee in an amount equal to the assigning
Bank's Tranche A Commitment assumed by it pursuant to such
Assignment and Acceptance and a new Tranche B Note to the
order of such Eligible Assignee in an amount equal to the
assigning Bank's Tranche B Commitment assumed by such
Eligible Assignee pursuant to such Assignment and Acceptance,
and a new Tranche A Note to the order of the assigning Bank
in an amount equal to the portion of its Tranche A Commitment
retained by the assigning Bank hereunder and a new Tranche B
Note to the order of the assigning Bank in an amount equal to
the portion of its Tranche B Commitment retained by the
assigning Bank hereunder. Such new Notes shall be in an
aggregate principal amount equal to the aggregate principal
amount of such surrendered Notes, shall be dated the
effective date of such Assignment and Acceptance and shall
otherwise be in substantially the respective form of Exhibit
2.04-A or Exhibit 2.04-B hereto, as applicable. Cancelled
Notes shall be returned to the Borrower that is the signatory
thereto.
(f) Each Bank may without the consent of the
Borrowers or either Agent sell participations to one or more
banks or other entities in all or a portion of its rights and
obligations under this Agreement (including all or a portion
of its Commitments and the Loans owing to it and the Notes
held by it); provided, however, that (i) such Bank's
obligations under this Agreement shall remain unchanged, (ii)
such Bank shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii)
the participating banks or other entities shall be entitled
to the cost protection provisions contained in Sections 2.11
through 2.13 to the same extent that the Bank from which such
participating bank or other entity acquired its participation
would be entitled to the benefit of such cost protection
provisions and (iv) the Borrowers, the Agents and the other
Banks shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations
under this Agreement, and such Bank shall retain the sole
right to enforce the obligations of the Borrowers relating to
the Loans and to approve any amendment, modification or
waiver of any provision of this Agreement (other than
amendments, modifications or waivers with respect to any fees
payable hereunder or the amount of principal of or the rate
at which interest is payable on the Loans, or the dates fixed
for payments of principal of or interest on the Loans).
(g) Any Bank or participant may, in connection
with any assignment or participation or proposed assignment
or participation pursuant to this Section 9.03, disclose to
the assignee or participant or proposed assignee or
participant, any information relating to the Borrowers
furnished to such Bank by or on behalf of the Borrowers;
provided that prior to any such disclosure, each such
assignee or participant or proposed assignee or participant
shall agree (subject to customary exceptions) to preserve the
confidentiality of any confidential information relating to
the Borrowers received from such Bank.
(h) Anything in this Section 9.03 to the contrary
notwithstanding, any Bank may at any time, without the
consent of the Borrowers or either Agent, assign and pledge
all or any portion of its Commitment and the Loans owing to
it to any Federal Reserve Bank (and its transferees) as
collateral security pursuant to Regulation A of the Board and
any Operating Circular issued by such Federal Reserve Bank.
No such assignment shall release the assigning Bank from its
obligations hereunder.
SECTION 9.04. Expenses of the Banks; Indemnity. (a)
Tandy agrees to pay all reasonable out-of-pocket expenses
reasonably incurred by the Agents in connection with the
preparation of this Agreement, the Notes and the other Loan
Documents or with any amendments, modifications or waivers of
the provisions hereof (whether or not the transactions hereby
contemplated shall be consummated) or reasonably incurred by
either Agent or any Bank in connection with the enforcement
or protection of their rights in connection with this
Agreement or with the Loans made or the Notes issued
hereunder, including the reasonable fees and disbursements of
Andrews & Kurth, special counsel for the Agents, and, in
connection with such enforcement or protection, the
reasonable fees and disbursements of other counsel for any
Bank, including allocated staff counsel costs. Tandy agrees
that it shall indemnify the Banks from and hold them harmless
against any documentary taxes, assessments or charges made by
any governmental authority by reason of the execution and
delivery of this Agreement or any of the Notes.
(b) Tandy agrees to indemnify the Agents and the
Banks and their directors, officers, employees and agents
(each such Person being called an "Indemnitee") against, and
to hold the Banks and such Indemnitee harmless from, any and
all losses, claims, damages, liabilities and related
expenses, including reasonable counsel fees and expenses,
incurred by or asserted against any Indemnitee arising out
of, in any way connected with, or as a result of (i) the
execution and delivery of this Agreement and the other
documents contemplated hereby, the performance by the parties
hereto and thereto of their respective obligations hereunder
and thereunder (including but not limited to the making of
the Commitments of each Bank) and consummation of the
transactions contemplated hereby and thereby, (ii) the use of
proceeds of the Loans or (iii) any claim, litigation,
investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Bank, apply to any
such losses, claims, damages, liabilities or related expenses
that are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.
Tandy agrees, however, that it expressly intends to indemnify
each Indemnitee from and hold each of them harmless against
any and all losses, liabilities, claims, damages or expenses
arising out of the ordinary sole or contributory negligence
of such Indemnitee, but not the gross negligence or willful
misconduct of such Indemnitee.
(c) The provisions of this Section 9.04 shall
remain operative and in full force and effect regardless of
the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or
unenforceability of any term or provision of this Agreement
or any Note, or any investigation made by or on behalf of any
Bank. All amounds due under this Section 9.04 shall be
payable on written demand therefor.
SECTION 9.05. Right of Setoff. If an Event of Default
shall have occurred and be continuing, each Bank 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 Bank to or for the credit or the account of
either Borrower against any of and all the obligations of the
Borrowers now or hereafter existing under this Agreement and
the Notes held by such Bank, irrespective of whether or not
such Bank shall have made any demand under this Agreement or
such Notes and although such obligations may be unmatured.
Each Bank agrees promptly to notify such Borrower after any
such setoff and application made by such Bank, but the
failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Bank under
this Section 9.05 are in addition to other rights and
remedies (including other rights of setoff) which such Bank
may have under applicable law.
SECTION 9.06. Governing Law. This Agreement, the
Notes, the other Loan Documents and all other documents
executed in connection herewith, shall be deemed to be
contracts and agreements executed by the Borrowers, the
Agents and the Banks under the laws of the State of Texas and
of the United States of America and for all purposes shall be
governed by, and construed and interpreted in accordance
with, the laws of said state (without regard to principles of
conflicts of law) and of the United States of America.
Without limitation of the foregoing, nothing in this
Agreement, the Notes or the other Loan Documents shall be
deemed to constitute a waiver of any rights which any Bank
may have under applicable federal legislation relating to the
amount of interest which such Bank may contract for, take,
receive, or charge in respect of any Loans, including any
right to take, receive, reserve and charge interest at the
rate allowed by the law of the state where such Bank is
located. The Agents, the Banks and the Borrowers further
agree that insofar as the provisions of Article 1.04,
Subtitle 1, Title 79, of the Revised Civil Statutes of Texas,
1925, as amended, are at any time applicable to the
determination of the Highest Lawful Rate with respect to the
Notes, the indicated rate ceiling computed from time to time
pursuant to Section (a) of such Article shall apply to the
Notes, provided, however, that to the extent permitted by
such Article, the Funds Administrator may from time to time
by notice from the Funds Administrator to the Borrowers
revise the election of such interest rate ceiling as such
ceiling affects the then current or future balances of the
Loans outstanding hereunder and under the Notes. The
provisions of Chapter 15 of Subtitle 3 of the said Title 79
do not apply to this Agreement or any Note issued hereunder.
SECTION 9.07. Waivers; Amendments. (a) No failure or
delay of any Agent or any Bank in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a
right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The
rights and remedies of the Agents and the Banks hereunder are
cumulative and not exclusive of any rights or remedies which
they would otherwise have. No waiver of any provision of
this Agreement, the Notes or the other Loan Documents or
consent to any departure by the Borrowers therefrom shall in
any event be effective unless the same shall be authorized as
provided in paragraph (b) below, and then such waiver or
consent shall be effective only in the specific instance and
for the purpose for which given. No notice or demand on the
Borrowers in any case shall entitle the Borrowers to any
other or further notice or demand in similar or other
circumstances. Each holder of any of the Notes shall be
bound by any amendment, modification, waiver or consent
authorized as provided herein, whether or not such Notes
shall have been marked to indicate such amendment,
modification, waiver or consent.
(b) Except as provided in Section 2.19, neither
this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or
agreements in writing entered into by the Borrowers and the
Required Banks; provided, however, that no such agreement
shall (i) change the principal amount of, or extend or
advance the maturity of or any date for the payment of any
principal of or interest on, any Loan, or waive or excuse any
such payment or any part thereof, or change the rate of
interest on any Loan, without the written consent of each
Bank affected thereby, (ii) change the Commitments of any
Bank without the written consent of such Bank, or change the
Commitment Fees of any Bank without the written consent of
each Bank or (iii) amend or modify the provisions of this
Section 9.07, Sections 2.08 through 2.15, Section 2.17,
Section 2.18, Section 9.03 or the definition of the "Required
Banks", without the written consent of each Bank; and
provided further that no such agreement shall amend, modify,
waive or otherwise affect the rights or duties of the
Administrative Agent hereunder without the written consent of
the Administrative Agent; and provided, finally, that no such
agreement shall amend, modify, waive or otherwise affect the
rights or duties of the Funds Administrator hereunder without
the written consent of the Funds Administrator. Each Bank
and each holder of any Note shall be bound by any
modification or amendment authorized by this Section 9.07
regardless of whether its Notes shall be marked to make
reference thereto, and any consent by any Bank or holder of a
Note pursuant to this Section 9.07 shall bind any Person
subsequently acquiring a Note from it, whether or not such
Note shall be so marked.
SECTION 9.08. Interest. Anything in this Agreement or
any Note or any other Loan Document to the contrary
notwithstanding, no Borrower shall ever be required to pay
unearned interest on any Note of such Borrower and shall
never be required to pay interest on such Note at a rate in
excess of the Highest Lawful Rate, and if the effective rate
of interest which would otherwise be payable under this
Agreement, such Note and the other Loan Documents would
exceed the Highest Lawful Rate, or if the holder of such Note
shall receive any unearned interest or shall receive monies
that are deemed to constitute interest which would increase
the effective rate of interest payable by such Borrower under
this Agreement and such Note to a rate in excess of the
Highest Lawful Rate, then (a) the amount of interest which
would otherwise be payable by such Borrower under this
Agreement and such Note shall be reduced to the amount
allowed under applicable law, and (b) any unearned interest
paid by such Borrower or any interest paid by such Borrower
in excess of the Highest Lawful Rate shall be credited on the
principal of such Note (or, if the principal amount of such
Note shall have been paid in full, refunded to such
Borrower). It is further agreed that, without limitation of
the foregoing, all calculations of the rate of interest
contracted for, charged or received by any Bank under the
Notes held by it, or under this Agreement, are made for the
purpose of determining whether such rate exceeds the Highest
Lawful Rate applicable to such Bank (such Highest Lawful Rate
being such Bank's "Maximum Permissible Rate"), and shall be
made, to the extent permitted by usury laws applicable to
such Bank (now or hereafter enacted), by amortizing,
prorating and spreading in equal parts during the period of
the full stated term of the Loans evidenced by said Notes all
interest at any time contracted for, charged or received by
such Bank in connection therewith. If at any time and from
time to time (i) the amount of interest payable to any Bank
on any date shall be computed at such Bank's Maximum
Permissible Rate pursuant to this Section 9.08 and (ii) in
respect of any subsequent interest computation period the
amount of interest otherwise payable to such Bank would be
less than the amount of interest payable to such Bank
computed at such Bank's Maximum Permissible Rate, then the
amount of interest payable to such Bank in respect of such
subsequent interest computation period shall continue to be
computed at such Bank's Maximum Permissible Rate until the
total amount of interest payable to such Bank shall equal the
total amount of interest which would have been payable to
such Bank if the total amount of interest had been computed
without giving effect to this Section 9.08.
SECTION 9.09. Severability. In the event any one or
more of the provisions contained in this Agreement or in the
Notes should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the
remaining provisions contained herein or therein shall not in
any way be affected or impaired thereby. The parties shall
endeavor in good faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions,
the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
SECTION 9.10. Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall
constitute an original but all of which when taken together
shall constitute but one contract, and shall become effective
as provided in Section 9.11.
SECTION 9.11. Binding Effect. This Agreement shall
become effective on the Execution Date, and thereafter shall
be binding upon and inure to the benefit of the Borrowers,
each Agent and each Bank and their respective successors and
assigns, except that the Borrowers shall not have the right
to assign their rights hereunder or any interest herein
except as provided in Section 9.03(a).
SECTION 9.12. FINAL AGREEMENT OF THE PARTIES. THIS
WRITTEN AGREEMENT (INCLUDING THE EXHIBITS AND SCHEDULES
HERETO), THE NOTES, THE OPERATING AGREEMENT, THE SUPPORT
AGREEMENT, THE AGENT'S LETTER AND THE OTHER LOAN DOCUMENTS
CONSTITUTE A "LOAN AGREEMENT" AS DEFINED IN SECTION 26.02(a)
OF THE TEXAS BUSINESS AND COMMERCE CODE, AND REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. Any previous
agreement among the parties with respect to the subject
matter hereof is superseded by this Agreement. Nothing in
this Agreement, expressed or implied, is intended to confer
upon any party other than the parties hereto any rights,
remedies, obligations or liabilities under or by reason of
this Agreement.
SECTION 9.13 SUBMISSION TO JURISDICTION. (a) TCC
HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY TEXAS
STATE OR FEDERAL COURT SITTING IN FORT WORTH, TEXAS OVER ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND TCC
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION
OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH TEXAS STATE
OR FEDERAL COURT; PROVIDED, HOWEVER, NOTHING IN THIS SECTION
9.13 IS INTENDED TO WAIVE THE RIGHT OF EITHER AGENT OR ANY
BANK OR TO REMOVE ANY SUCH ACTION OR PROCEEDING COMMENCED IN
ANY SUCH TEXAS STATE COURT TO AN APPROPRIATE TEXAS FEDERAL
COURT TO THE EXTENT THE BASIS FOR SUCH REMOVAL EXISTS UNDER
APPLICABLE LAW. TCC HEREBY IRREVOCABLY APPOINTS HERSCHEL C.
WINN (THE "PROCESS AGENT"), WITH AN OFFICE ON THE DATE HEREOF
AT 1800 ONE TANDY CENTER, FORT WORTH, TEXAS 76102, AS ITS
AGENT TO RECEIVE ON BEHALF OF IT AND ITS PROPERTIES SERVICE
OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER PROCESS
WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH
SERVICE MAY BE MADE BY MAILING BY CERTIFIED MAIL A COPY OF
SUCH PROCESS TO TCC IN CARE OF THE PROCESS AGENT AT THE
PROCESS AGENT'S ABOVE ADDRESS, WITH A COPY TO TCC AT ITS
ADDRESS SPECIFIED HEREIN AND TCC HEREBY IRREVOCABLY
AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH
SERVICE ON ITS BEHALF. AS AN ALTERNATIVE METHOD OF SERVICE,
TCC ALSO IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL
PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING BY
CERTIFIED MAIL OF COPIES OF SUCH PROCESS TO IT AT ITS ADDRESS
SPECIFIED HEREIN. TCC 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 IN
ANY OTHER MANNER PROVIDED BY LAW.
(b) NOTHING IN THIS SECTION 9.13 SHALL AFFECT THE
RIGHT OF THE AGENTS OR ANY BANK TO SERVE LEGAL PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF EITHER
AGENT OR ANY BANK TO BRING ANY ACTION OR PROCEEDING AGAINST
TCC OR ITS PROPERTIES IN THE COURTS OF ANY OTHER
JURISDICTIONS.
IN WITNESS HEREOF, the Borrowers, the Banks, the
Administrative Agent and the Funds Administrator have caused
this Agreement to be duly executed by their respective
authorized officers as of the day and year first above
written.
TANDY CORPORATION
By: /s/ William Bousquette
Name: William Bousquette
Title: Executive Vice President and
Chief Financial Officer
TANDY CREDIT CORPORATION
By: /s/ Dwain H. Hughes
Name: Dwain H. Hughes
Title: Assistant Treasurer
Tranche A Tranche B TEXAS COMMERCE BANK,
Commitment Commitment NATIONAL ASSOCIATION,
individually
$25,000,000 $25,000,000 and as Administrative Agent
By: /s/ J. Richard Barajas
Name: J. Richard Barajas
Title: Vice President
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION, as Funds
Administrator
By: /s/ Gina Hardwick
Name: Gina Hardwick
Title: Investment Officer
Tranche A Tranche B ALGEMENE BANK NEDERLAND N.V.,
Commitment Commitment HOUSTON AGENCY
$10,000,000 $10,000,000
By: /s/ Charles W. Randall
Name: Charles W. Randall
Title: Vice President
By: /s/ Alan C. Weitzner
Name: Alan C. Weitzner
Title: Assistant Vice President
$20,000,000 $20,000,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By: /s/ Samir Sidani
Name: Samir Sidani
Title: Vice President
$20,000,000 $20,000,000 THE BANK OF NEW YORK
By: /s/ Michael J. Moretti
Name: Michael J. Moretti
Title: Vice President
$15,000,000 $15,000,000 BARCLAYS BANK PLC
By: /s/ William C. Collins, II
Name: William C. Collins, II
Title: Vice President
$15,000,000 $15,000,000 CONTINENTAL BANK N.A.
By: /s/ Laurens F. Schaad, Jr.
Name: Laurens F. Schaad, Jr.
Title: Vice President
Tranche A Tranche B CREDIT LYONNAIS, CAYMAN ISLAND
Commitment Commitment BRANCH
$20,000,000 $20,000,000
By:
Name:
Title:
$20,000,000 $20,000,000 NATIONAL WESTMINSTER BANK PLC
NEW YORK BRANCH
By: /s/ David F. Brealey
Name: David F. Brealey
Title: Vice President
NATIONAL WESTMINSTER BANK PLC
NASSAU BRANCH
By: /s/ David F. Brealey
Name: David F. Brealey
Title: Vice President
$20,000,000 $20,000,000 NCNB TEXAS NATIONAL BANK
By: /s/ Vincent A. Liberio
Name: Vincent A. Liberio
Title: Senior Vice President
Tranch A Tranch B SOCIETE GENERALE, SOUTHWEST
Commitment Commitment AGENCY
$10,000,000 $10,000,000
By: /s/ Matthew Flanigan
Name: Matthew Flanigan
Title: Vice President-Manager
By: /s/ Louis P. Laville, III
Name: Louis P. Laville, III
Title: Assistant Treasurer
$5,000,000 $5,000,000 THE SUMITOMO BANK, LIMITED
HOUSTON AGENCY
By: /s/ Hideki Matsui
Name: Hideki Matsui
Title: General Manager
$20,000,000 $20,000,000 WESTPAC BANKING CORPORATION
By: /s/ Lawrence Creedon
Name: Lawrence Creedon
Title: Vice President