[CONFORMED COPY]
$200,000,000
CREDIT AGREEMENT
dated as of
March 25, 1994
among
American President Companies, Ltd.,
The Banks Listed Herein
and
Morgan Guaranty Trust Company of New York,
as Agent
TABLE OF CONTENTS 1
Page
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions 1
1.02 Accounting Terms and Determinations 17
1.03 Types of Borrowings 17
1.04 Basis for Ratings 18
ARTICLE II
THE CREDITS
SECTION 2.01 Commitments to Lend 18
2.02 Notice of Committed Borrowings 18
2.03 Money Market Borrowings 19
2.04 Notice to Banks; Funding of Loans 23
2.05 Notes 24
2.06 Maturity of Loans 25
2.07 Interest Rates 25
2.08 Fees 29
2.09 Optional Termination or
Reduction of Commitments 30
2.10 Termination of Commitments 30
2.11 Optional Prepayments 30
2.12 General Provisions as to Payments 31
2.13 Funding Losses 31
2.14 Computation of Interest and Fees 32
2.15 Withholding Tax Exemption 32
2.16 Regulation D Compensation 33
2.17 Termination of Commitments Under
Existing Agreement; Amendment of
Receivables Purchase Agreements 33
ARTICLE III
CONDITIONS
SECTION 3.01 Effectiveness 33
3.02 Borrowings 35
1The Table of Contents is not a part of this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Corporate Existence and Power 36
4.02 Corporate and Governmental
Authorization; No Contravention 36
4.03 Binding Effect 36
4.04 Financial Information 36
4.05 Litigation 37
4.06 Compliance with ERISA 37
4.07 Environmental Matters 37
4.08 Taxes 38
4.09 Subsidiaries 38
4.10 Not an Investment Company 38
4.11 MarAd Requirements 38
4.12 Full Disclosure 39
ARTICLE V
COVENANTS
SECTION 5.01 Information 39
5.02 Payment of Obligations 43
5.03 Maintenance of Property; Insurance 43
5.04 Conduct of Business, Maintenance of
Existence and Compliance with
Laws 44
5.05 Inspection of Property,
Books and Records 44
5.06 Minimum Consolidated Tangible
Net Worth 45
5.07 Negative Pledge 45
5.08 Consolidations, Mergers and
Sales of Assets 47
5.09 Use of Proceeds 47
5.10 Consolidated Interest Coverage
Ratio 47
5.1 Consolidated Leverage Ratio 48
5.12 Restrictions on Subsidiary
and Secured Debt 48
5.13 Capital Contributions to
Subsidiaries 49
5.14 No New Restrictions on Subsidiary
Dividends 49
5.15 Investments; Acquisitions 49
ARTICLE VI
DEFAULTS AND EVENTS OF TERMINATION
SECTION 6.01 Events of Default 50
6.02 Notice of Default 53
6.03 Events of Termination 53
ARTICLE VII
THE AGENT
SECTION 7.01 Appointment and Authorization 53
7.02 Agent and Affiliates 53
7.03 Action by Agent 53
7.04 Consultation with Experts 54
7.05 Liability of Agent 54
7.06 Indemnification 54
7.07 Credit Decision 54
7.08 Successor Agent 55
7.09 Agent's Fee 55
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01 Basis for Determining Interest
Rate Inadequate or Unfair 55
8.02 Illegality 56
8.03 Increased Cost and Reduced Return 57
8.04 Base Rate Loans Substituted for
Affected Fixed Rate Loans 59
8.05 Substitution of Bank 59
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices 60
9.02 No Waivers 60
9.03 Expenses; Documentary Taxes 60
9.04 Indemnification 61
9.05 Sharing of Set-Offs 61
9.06 Amendments and Waivers 62
9.07 Successors and Assigns 62
9.08 Collateral 64
9.09 Confidentiality 65
9.10 Governing Law; Submission to Juris-
diction 65
9.11 Counterparts; Integration 66
9.12 WAIVER OF JURY TRIAL 66
Schedule I - Certain Existing Liens
Exhibit A - Note
Exhibit B - Money Market Quote Request
Exhibit C - Invitation for Money Market Quotes
Exhibit D - Money Market Quote
Exhibit E - Opinion of Counsel for the Borrower
Exhibit F - Opinion of Special Counsel for the
Agent
Exhibit G - Assignment and Assumption Agreement
CREDIT AGREEMENT
AGREEMENT dated as of March 25, 1994, among AMERICAN PRESIDENT
COMPANIES, LTD., the BANKS listed on the signature pages hereof and MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Agent.
WITNESSETH:
WHEREAS, the Borrower is a party to an Amended and Restated
Credit Agreement dated as of March 17, 1992 among the Borrower, American
President Lines, Ltd., the banks listed therein and Morgan Guaranty Trust
Company of New York as Agent, as heretofore amended (the "Existing Agreement");
and
WHEREAS the Borrower wishes to enter into this Agreement and,
concurrently with the effectiveness of this Agreement, wishes to terminate the
commitments of the banks under the Existing Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein,
have the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market
Quotes setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Adjusted CD Rate" has the meaning set forth in Section 2.07(b).
"Administrative Questionnaire" means, with respect to each Bank,
an administrative questionnaire in the form prepared by the Agent and submitted
to the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means any Subsidiary (except a Consolidated
Subsidiary) and any other Person in which the Borrower or any of its
Consolidated Subsidiaries has an equity investment as to which it uses the
equity method of accounting.
"Agent" means Morgan Guaranty Trust Company of New York in its
capacity as agent for the Banks hereunder, and its successors in such capacity.
"APD" means APL Land Transport Services, Inc., a Tennessee
corporation, and its successors.
"APL" means American President Lines, Ltd., a Delaware
corporation, and its successors.
"Applicable Lending Office" means, with respect to any Bank, (i)
in the case of its Domestic Loans, its Domestic Lending Office, (ii) in the case
of its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case
of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" has the meaning set forth in Section 2.07(b).
"Assignee" has the meaning set forth in Section 9.07(c).
"Authorized Officer" means any of the following officers of the
Borrower: the chairman of the board of directors, chief executive officer, chief
operating officer, chief financial officer, president, treasurer, vice
president-treasury, vice president-controller, any executive vice president and
any assistant treasurer.
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 9.07(c), and their respective
successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank as a
Base Rate Loan in accordance with the applicable Notice of Committed Borrowing
or pursuant to Article VIII.
"Beneficial Owner" means, with respect to any securities, a
Person who would be deemed to be a beneficial owner thereof under Rule 13d-3 of
the Exchange Act as in effect on the date hereof.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means American President Companies, Ltd., a Delaware
corporation, and its successors.
"Borrower's 1993 Form 10-K" means the Borrower's annual report on
Form 10-K for 1993, as filed with the Securities and Exchange Commission
pursuant to the Exchange Act.
"Borrowing" has the meaning set forth in Section 1.03.
"CD Base Rate" has the meaning set forth in Section 2.07(b).
"CD Loan" means a Committed Loan to be made by a Bank as a CD
Loan in accordance with the applicable Notice of Committed Borrowing.
"CD Margin" has the meaning set forth in Section 2.07(b).
"CD Reference Banks" means Bank of America National Trust and
Savings Association and Morgan Guaranty Trust Company of New York.
"Change in Control" means any of the following events or
conditions: (i) any Interested Stockholder is or becomes a Beneficial Owner,
directly or indirectly, of 30% or more of the outstanding shares of the Borrower
entitled to vote in the election of directors, unless the acquisition of 30% or
more of such shares by such Interested Stockholder shall have been approved or
ratified by a majority of the Continuing Directors, (ii) any Interested
Stockholder is or becomes a Beneficial Owner, directly or indirectly, of 50% or
more of the outstanding shares of the Borrower entitled to vote in the election
of directors, (iii) Continuing Directors no longer constitute a majority of the
Borrower's board of directors, or (iv) a "Triggering Event" occurs as specified
in the Amended and Restated Rights Agreement dated as of October 22, 1991
between the Borrower and the First National Bank of Boston, as Rights Agent
(including any further addendum, amendment, extension, modification, replacement
or supplement thereto or thereof).
"Commitment" means, with respect to each Bank, the amount set
forth opposite the name of such Bank on the signature pages hereof, as such
amount may be reduced from time to time pursuant to Section 2.09.
"Committed Loan" means a loan made by a Bank pursuant to Section
2.01.
"Consolidated Assets" means, at any date of determination, the
amount that would, in accordance with generally accepted accounting principles,
be shown as the total amount of assets under the caption "Assets" on a
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries at
such date.
"Consolidated Guaranteed Debt" means at any date the aggregate
amount of Debt which is Guaranteed by the Borrower or any of its Consolidated
Subsidiaries and is outstanding at such date, determined on a consolidated
basis.
"Consolidated Interest Coverage Ratio" has the meaning set forth
in Section 5.10.
"Consolidated Leverage Ratio" has the meaning set forth in
Section 5.11.
"Consolidated Net Income After Tax" means, for any period, the
aggregate amount that would, in accordance with generally accepted accounting
principles, be included under the caption "Net Income" on a consolidated
statement of income of the Borrower and its Consolidated Subsidiaries for such
period.
"Consolidated Net Property and Equipment" means, at any date of
determination, the amount that would, in accordance with generally accepted
accounting principles, be shown as the total amount of assets under the caption
"Property and Equipment, Net" or any similar caption on a consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries at such date.
"Consolidated Pretax Earnings" means, for any period, the
consolidated income (loss) of the Borrower and its Consolidated Subsidiaries for
such period, before provisions for income taxes but after interest expense, (a)
less (to the extent included therein) (i) the amount, if any, by which their
equity in earnings of Persons other than Consolidated Subsidiaries for such
period exceeded the aggregate amount of dividends or other distributions
received from such Persons during such period and (ii) any nonrecurring or
extraordinary gains (or plus any nonrecurring or extraordinary losses) for such
period and (b) plus (i) (to the extent not otherwise included therein) the
amount, if any, by which the aggregate amount of cash dividends or other
distributions received from Persons other than Consolidated Subsidiaries during
such period exceeded their equity in earnings of such Persons for such period or
(ii) (to the extent included therein) the amount of their share of losses of
such Persons for such period, all determined in accordance with generally
accepted accounting principles.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which would be consolidated with those of the
Borrower in its consolidated financial statements prepared in accordance with
generally accepted accounting principles if such statements were prepared at
such date.
"Consolidated Tangible Net Worth" means at any date an amount
equal to the sum of (A) the amount that would, in accordance with generally
accepted accounting principles, be reflected as 9% Series C Cumulative
Convertible Preferred Stock and/or 9% Series D Convertible Preferred Stock of
the Borrower on a balance sheet of the Borrower at such date plus (B) the
consolidated stockholders' equity of the Borrower and its Consolidated
Subsidiaries less their consolidated Intangible Assets, all determined as of
such date. For purposes of this definition "Intangible Assets" means the amount
(to the extent reflected in determining such consolidated stockholders' equity)
of (i) all write-ups (other than write-ups resulting from foreign currency
translations and write-ups of assets of a going concern business made within
twelve months after the acquisition of such business) subsequent to December 31,
1993 in the book value of any asset owned by the Borrower or any of its
Consolidated Subsidiaries, (ii) all Investments in unconsolidated Subsidiaries
and other Affiliates and (iii) all unamortized debt discount and expense,
unamortized deferred charges, goodwill, patents, trademarks, service marks,
trade names, anticipated future benefit of tax loss carry-forwards, copyrights,
organization or developmental expenses including research and developmental
expenses and other intangible assets.
"Continuing Director" means a member of the Borrower's board of
directors who (i) was a member of such board immediately prior to the time that
any Interested Stockholder became an Interested Stockholder or (ii) was
nominated by a majority of the directors who were Continuing Directors at the
time of such nomination.
"Debt" of any Person means at any date, without duplication, (i)
all obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (v) all non-contingent
obligations of such Person to reimburse any bank or other Person in respect of
amounts paid under a letter of credit or similar instrument, (vi) all Debt of
others secured by a Lien on any asset of such Person, whether or not such Debt
is assumed by such Person, and (vii) all Debt of others Guaranteed by such
Person; provided that
(x) if Debt referred to in clause (vi) above is without
recourse to the Borrower or any Subsidiary, the amount of such
Debt shall be calculated at the lesser of (A) the aggregate
outstanding principal amount of such Debt or (B) the aggregate
fair realizable value of the assets securing such Debt, and
(y) when calculating the amount of Debt of the Borrower
and its Consolidated Subsidiaries on a consolidated basis,
obligations of the Borrower or any Consolidated Subsidiary that
are eliminated in consolidation pursuant to generally accepted
accounting principles shall be eliminated.
"Default" means any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Depreciation" means, for any period, the aggregate amount that
would, in accordance with generally accepted accounting principles, be included
as depreciation expense under the caption "Depreciation and Amortization" on a
consolidated statement of income of the Borrower and its Consolidated
Subsidiaries for such period.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in New York City or San Francisco are
authorized by law to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending Office)
or such other office as such Bank may hereafter designate as its Domestic
Lending Office by notice to the Borrower and the Agent; provided that any Bank
may so designate separate Domestic Lending Offices for its Base Rate Loans, on
the one hand, and its CD Loans, on the other hand, in which case all references
herein to the Domestic Lending Office of such Bank shall be deemed to refer to
either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in
Section 2.07(b).
"Effective Date" has the meaning set forth in Section 3.01.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all members
of a controlled group of corporations and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrower and the Agent.
"Euro-Dollar Loan" means a Committed Loan to be made by a Bank as
a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section
2.07(c).
"Euro-Dollar Reference Banks" means the principal London offices
of Barclays Bank PLC, ABN AMRO Bank N.V. and Morgan Guaranty Trust Company of
New York.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five billion
dollars in respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents).
"Event of Default" has the meaning set forth in Section 6.01.
"Event of Termination" has the meaning set forth in Section 6.03.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Existing Agreement" has the meaning set forth in the first
WHEREAS clause at the beginning of this Agreement.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if no such rate is so
published on such next succeeding Domestic Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to Morgan Guaranty Trust Company
of New York on such day on such transactions as determined by the Agent.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money
Market Loans (excluding Money Market LIBOR Loans bearing interest at the Base
Rate pursuant to Section 8.01(a)) or any combination of the foregoing.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt (whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Debt of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part), provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Interest Expense" means, for any period, the aggregate amount
that would, in accordance with generally accepted accounting principles, be
included as interest expense under the caption "Interest" on a consolidated
statement of income of the Borrower and its Consolidated Subsidiaries for such
period.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending one,
two, three or six months thereafter, as the Borrower may elect in the applicable
Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall, subject to
clause (c) below, end on the last Euro-Dollar Business Day of a
calendar month; and
(c) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
(2) with respect to each CD Borrowing, the period commencing on the date of
such Borrowing and ending 30, 60, 90 or 180 days thereafter, as the Borrower may
elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
(3) with respect to each Base Rate Borrowing, the period
commencing on the date of such Borrowing and ending 30 days
thereafter; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
(4) with respect to each Money Market LIBOR Borrowing, the period commencing on
the date of such Borrowing and ending such whole number of months thereafter as
the Borrower may elect in accordance with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall, subject to
clause (c) below, end on the last Euro-Dollar Business Day of a
calendar month; and
(c) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
(5) with respect to each Money Market Absolute Rate Borrowing, the period
commencing on the date of such Borrowing and ending such number of days
thereafter (but not less than 30 days) as the Borrower may elect in accordance
with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after
the Termination Date shall end on the Termination Date.
"Interested Stockholder" means (i) any Person which is or becomes
the Beneficial Owner, directly or indirectly, of 5% or more of the outstanding
shares of the Borrower entitled to vote or (ii) any two or more Persons which
"act as a partnership, limited partnership, syndicate or other group for the
purpose of acquiring, holding or disposing of securities" of the Borrower and
which are or become the Beneficial Owners, directly or indirectly, of 5% or more
of the outstanding shares of the Borrower entitled to vote.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended, or any successor statute.
"Investment" means any investment in any Person, whether by means
of share purchase, capital contribution, loan, time deposit or otherwise.
"Level I Period" means a period during which the Borrower's
senior long-term public debt is rated BBB+ or higher by S&P and Baa1 or higher
by Moody's.
"Level II Period" means a period (i) during which the Borrower's
senior long-term public debt is rated BBB or higher by S&P and Baa2 or higher by
Moody's and (ii) which is not a Level I Period.
"Level III Period" means a period (i) during which the Borrower's
senior long-term public debt is rated BBB- or higher by S&P and Baa3 or higher
by Moody's and (ii) which is not a Level I Period or a Level II Period.
"Level IV Period" means a period (i) during which the Borrower's
senior long-term public debt is rated BB+ or higher by S&P and Ba1 or higher by
Moody's and (ii) which is not a Level I Period, a Level II Period or a Level III
Period.
"Level V Period" means any period which is not a Level I Period,
a Level II Period, a Level III Period or a Level IV Period. A period during
which either S&P or Moody's does not rate the Borrower's senior long-term public
debt shall constitute a Level V Period.
"LIBOR Auction" means a solicitation of Money Market Quotes
setting forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.03.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, the Borrower or any Subsidiary shall
be deemed to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such
asset.
"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money
Market Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money
Market Loans or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.07(c).
"MarAd" means the United States Maritime Administration, or any
entity succeeding to any or all of the rights and obligations of MarAd under any
agreement with the Borrower or any Subsidiary.
"Material Plan" means at any time a Plan or Plans having
aggregate Unfunded Liabilities in excess of $15,000,000.
"Material Subsidiary" means at any time a Subsidiary which is not
a Nonmaterial Subsidiary. For purposes of this definition, "Nonmaterial
Subsidiary" means at any time any Subsidiary (other than APL) which at such time
has been designated by the Borrower, by notice to the Agent, as a Nonmaterial
Subsidiary and has not been redesignated as a Material Subsidiary in any
subsequent notice from the Borrower to the Agent; provided that all Nonmaterial
Subsidiaries, if aggregated and considered as a single subsidiary, would not as
of such time meet the definition of a "significant subsidiary" contained as of
the date hereof in Regulation S-X of the Securities and Exchange Commission.
"Minimum Adjusted Net Worth" has the meaning set forth in Section
5.06.
"Money Market Absolute Rate" has the meaning set forth in Section
2.03(d).
"Money Market Absolute Rate Loan" means a loan to be made by a
Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such Bank
as it may hereafter designate as its Money Market Lending Office by notice to
the Borrower and the Agent; provided that any Bank may from time to time by
notice to the Borrower and the Agent designate separate Money Market Lending
Offices for its Money Market LIBOR Loans, on the one hand, and its Money Market
Absolute Rate Loans, on the other hand, in which case all references herein to
the Money Market Lending Office of such Bank shall be deemed to refer to either
or both of such offices, as the context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank
pursuant to a LIBOR Auction (including such a loan bearing interest at the Base
Rate pursuant to Section 8.01(a)).
"Money Market Loan" means a Money Market LIBOR Loan or a Money
Market Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.03(d).
"Money Market Quote" means an offer by a Bank to make a Money
Market Loan in accordance with Section 2.03.
"Moody's" means Moody's Investors Service, Inc., a Delaware
corporation, and its successors and its assigns, and if such corporation shall
be dissolved or liquidated or shall no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
nationally recognized securities rating agency (other than S&P) designated by
the Required Banks and not disapproved by the Borrower if such an agency shall
exist.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.
"Notes" means promissory notes of the Borrower, substantially in
the form of Exhibit A hereto, evidencing the obligation of the Borrower to repay
the Loans, and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined in
Section 2.03(f)).
"Off-Site Real Estate Improvement Lien" means a Lien on real
estate securing obligations pertaining to assessments or bonded indebtedness for
off-site improvements for the benefit of such real estate.
"Parent" means, with respect to any Bank, any Person controlling
such Bank.
"Participant" has the meaning set forth in Section 10.07(b).
"Payment Date" has, with respect to each Receivables Purchase
Agreement, the meaning set forth in Section 1.01 thereof.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"Potential Event of Termination" means any condition or event
which with the giving of notice or lapse of time or both would, unless cured or
waived, become an Event of Termination.
"Pricing Period" means a Level I Period, a Level II Period, a
Level III Period, a Level IV Period or a Level V Period.
"Prime Rate" means the rate of interest publicly announced by
Morgan Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
"Purchase Money Lien" has the meaning set forth in Section
5.07(e).
"Receivables Purchase Agreements" means, collectively, (i) the
Receivables Purchase Agreement dated as of August 29, 1991 among APL, the Banks,
J.P. Morgan Delaware, as Administrative Agent, and Morgan Guaranty Trust Company
of New York, as Co-Agent, and (ii) the Receivables Purchase Agreement dated as
of August 29, 1991 among APD, the Banks, J.P. Morgan Delaware, as Administrative
Agent, and Morgan Guaranty Trust Company of New York, as Co-Agent, as each such
agreement may be amended from time to time.
"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any one
of such Reference Banks.
"Refunding Borrowing" means a Committed Borrowing which, after
application of the proceeds thereof, results in no net increase in the
outstanding principal amount of Committed Loans made by any Bank.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having at least 66 2/3%
of the aggregate amount of the Commitments or, if the Commitments shall have
been terminated, holding Notes evidencing at least 66 2/3% of the aggregate
unpaid principal amount of the Loans.
"Revolving Credit Period" means the period from and including the
Effective Date to but excluding the Termination Date.
"S&P" means Standard & Poor's Corporation, a New York
corporation, and its successors and its assigns, and if such corporation shall
be dissolved or liquidated or shall no longer perform the functions of a
securities rating agency, "S&P" shall be deemed to refer to any other nationally
recognized securities rating agency (other than Moody's) designated by the
Required Banks and not disapproved by the Borrower if such an agency shall
exist.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Borrower (or, if such term
is used with reference to any other Person, by such other Person).
"Termination Date" means March 25, 1999, or, if such date is not
a Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.
"Total Borrowed Funds" means, as of any date of determination,
the aggregate amount of all Debt which would be reflected, in accordance with
generally accepted accounting principles, on a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries at such date including, without
limitation, the current and long-term portions of capital lease obligations,
current and long-term portions of long-term debt, commercial paper obligations
and other short-term borrowings.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the present value of all benefits under
such Plan exceeds (ii) the fair market value of all Plan assets allocable to
such benefits (excluding any accrued but unpaid contributions), all determined
as of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA Group
to the PBGC or any other Person under Title IV of ERISA.
"Wholly-Owned Subsidiary" means any Subsidiary all of the shares
of capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred in by the
Borrower's independent public accountants) with the most recent audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries delivered to the Banks; provided that, if the Borrower notifies the
Agent that the Borrower wishes to amend any covenant in Article V to eliminate
the effect of any change in generally accepted accounting principles on the
operation of such covenant (or if the Agent notifies the Borrower that the
Required Banks wish to amend Article V for such purpose), then the Borrower's
compliance with such covenant shall be determined on the basis of generally
accepted accounting principles in effect immediately before the relevant change
in generally accepted accounting principles became effective, until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to the
Borrower and the Required Banks.
SECTION 1.03. Types of Borrowing. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrower
pursuant to Article II on a single date and for a single Interest Period.
Borrowing are classified for purposes of this Agreement either by reference to
the pricing of Loans comprising such Borrowing (e.g., a "Euro-Dollar Borrowing"
is a Borrowing comprised of Euro-Dollar Loans) or by reference to the provisions
of Article II under which participation therein is determined (i.e., a
"Committed Borrowing" is a Borrowing under Section 2.01 in which all Banks
participate in proportion to their Commitments, while a "Money Market Borrowing"
is a Borrowing under Section 2.03 in which the Bank participants are determined
on the basis of their bids in accordance therewith).
SECTION 1.04 Basis for Ratings. The credit ratings to be
utilized in the determination of a Pricing Period are the ratings assigned to
unsecured obligations of the Borrower without third party credit support.
Ratings assigned to any obligation which is secured or which has the benefit of
third party credit support shall be disregarded.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. Each Bank severally agrees,
on the terms and conditions set forth in this Agreement, to make loans to the
Borrower pursuant to this Section from time to time during the Revolving Credit
Period in amounts such that the aggregate principal amount of Committed Loans by
such Bank at any one time outstanding shall not exceed the amount of its
Commitment. Each Borrowing under this Section 2.01 shall be in an aggregate
principal amount of $5,000,000 or any larger multiple of $1,000,000 (except that
any such Borrowing may be in the aggregate amount available in accordance with
Section 3.02(b)) and shall be made from the several Banks ratably in proportion
to their respective Commitments. Within the foregoing limits, the Borrower may
borrow under this Section 2.01, repay, or to the extent permitted by Section
2.11, prepay Loans and reborrow at any time prior to the Termination Date under
this Section 2.01.
SECTION 2.02. Notice of Committed Borrowings. The Borrower shall
give the Agent notice (a "Notice of Committed Borrowing") not later than 12:00
Noon (New York City time) on (x) the date of each Base Rate Borrowing, (y) the
second Domestic Business Day before each CD Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(a) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Domestic Borrowing or a
Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing,
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to
be CD Loans, Base Rate Loans or Euro-Dollar Loans, and
(d) in the case of a Fixed Rate Borrowing, the duration
of the Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
SECTION 2.03. Money Market Borrowings.
(a) The Money Market Option. In addition to Committed
Borrowings pursuant to Section 2.01, the Borrower may, as set forth in this
Section, request the Banks during the Revolving Credit Period to make offers to
make Money Market Loans; provided that the Borrower may not make any such
request or borrow any Money Market Loan during a Level IV Period or a Level V
Period. The Banks may, but shall have no obligation to, make such offers and
the Borrower may, but shall have no obligation to, accept any such offers in the
manner set forth in this Section.
(b) Money Market Quote Request. When the Borrower wishes to
request offers to make Money Market Loans under this Section, it shall transmit
to the Agent by telex or facsimile transmission a Money Market Quote Request
substantially in the form of Exhibit B hereto so as to be received no later than
12:00 Noon (New York City time) on (x) the fifth Euro-Dollar Business Day prior
to the date of Borrowing proposed therein, in the case of a LIBOR Auction or (y)
the Domestic Business Day next preceding the date of Borrowing proposed therein,
in the case of an Absolute Rate Auction (or, in either case, such other time or
date as the Borrower and the Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective) specifying:
(i) the proposed date of Borrowing, which shall be a
Euro-Dollar Business Day in the case of a LIBOR Auction or a
Domestic Business Day in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$5,000,000 or a larger multiple of $1,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period,
and
(iv) whether the Money Market Quotes requested are to set
forth a Money Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt
of a Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit C hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance with
this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each
Bank may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Agent by telex or facsimile transmission at its offices
specified in or pursuant to Section 9.01 not later than (x) 2:00 P.M. (New York
City time) on the fourth Euro-Dollar Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction or (y) 9:30 A.M. (New York City time)
on the proposed date of Borrowing, in the case of an Absolute Rate Auction (or,
in either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective); provided that Money Market
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank may be submitted, and may only be submitted, if the Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) one hour prior to the deadline for the other Banks,
in the case of a LIBOR Auction or (y) 15 minutes prior to the deadline for the
other Banks, in the case of an Absolute Rate Auction. Subject to Articles III
and VI, any Money Market Quote so made shall be irrevocable except with the
written consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for
which each such offer is being made, which principal amount (w)
may be equal to, greater than or less than the Commitment of the
quoting Bank, (x) must be $1,000,000 or a larger multiple
thereof, (y) may not exceed the principal amount of Money Market
Loans for which offers were requested and (z) may be subject to
an aggregate limitation as to the principal amount of Money
Market Loans for which offers being made by such quoting Bank may
be accepted,
(C) in the case of a LIBOR Auction, the margin above or
below the applicable London Interbank Offered Rate (the "Money
Market Margin") offered for each such Money Market Loan,
expressed as a percentage (specified to the nearest 1/10,000th of
1%) to be added to or subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of
interest per annum (specified to the nearest 1/10,000th of 1%)
(the "Money Market Absolute Rate") offered for each such Money
Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D
hereto or does not specify all of the information required by
subsection (d)(ii);
(B) contains qualifying, conditional or similar
language;
(C) proposes terms other than or in addition to those
set forth in the applicable Invitation for Money Market Quotes;
or
(D) arrives after the time set forth in subsection
(d)(i).
(e) Notice to Borrower. The Agent shall promptly notify the
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that is
in accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest error in
such former Money Market Quote. The Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Money Market Loans for which
offers have been received for each Interest Period specified in the related
Money Market Quote Request, (B) the respective principal amounts and Money
Market Margins or Money Market Absolute Rates, as the case may be, so offered
and (C) if applicable, limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be accepted.
(f) Acceptance and Notice by Borrower. Not later than 10:30
A.M. (New York City time) on (x) the third Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the proposed
date of Borrowing, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Agent shall have mutually agreed
and shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), the Borrower shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money
Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the
related Money Market Quote Request,
(ii) the principal amount of each Money Market Borrowing
must be $5,000,000 or a larger multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as
the case may be, and
(iv) the Borrower may not accept any offer that is described
in subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Agent. If offers are made by two or more
Banks with the same Money Market Margins or Money Market Absolute Rates, as the
case may be, for a greater aggregate principal amount than the amount in respect
of which such offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted shall
be allocated by the Agent among such Banks as nearly as possible (in such
multiples, not greater than $1,000,000, as the Agent may deem appropriate) in
proportion to the aggregate principal amounts of such offers. Determinations by
the Agent of the amounts of Money Market Loans shall be conclusive in the
absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans.
(a) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's share (if
any) of such Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.
(b) The provisions of Section 2.02 and 2.03 above
notwithstanding, if by 12:00 Noon (New York City time) on the last day of the
Interest Period applicable to an outstanding Borrowing the Borrower shall have
neither (i) given timely notice of a Borrowing on the last day of such Interest
Period nor (ii) notified the Agent that it does not intend to borrow hereunder
on the last day of such Interest Period, then the Agent shall be deemed to have
received a Notice of Committed Borrowing specifying that (x) the date of the
proposed Borrowing shall be the last day of such Interest Period, (y) the
aggregate amount of the proposed Borrowing shall be the amount of such
outstanding Borrowing and (z) the Loans comprising the proposed Borrowing are to
be Base Rate Loans.
(c) Not later than 2:00 P.M. (New York City time) on the date of
each Borrowing, each Bank participating therein shall (except as provided in
subsection (d) of this Section) make available its share of such Borrowing, in
Federal or other funds immediately available in New York City, to the Agent at
its address specified in or pursuant to Section 10.01. Unless the Agent
determines that any applicable condition specified in Article III has not been
satisfied, the Agent will make the funds so received from the Banks available to
the Borrower at the Agent's aforesaid address.
(d) If any Bank makes a new Loan hereunder on a day on which the
Borrower is to repay all or any part of an outstanding Loan from such Bank, such
Bank shall apply the proceeds of its new Loan to make such repayment and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount being repaid shall be made available by such Bank to the Agent as
provided in subsection (c), or remitted by the Borrower to the Agent as provided
in Section 2.12, as the case may be.
(e) Unless the Agent shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not make available to the
Agent such Bank's share of such Borrowing, the Agent may assume that such Bank
has made such share available to the Agent on the date of such Borrowing in
accordance with subsections (c) and (d) of this Section 2.04 and the Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the Agent, at
(i) in the case of the Borrower, a rate per annum equal to the higher of the
Federal Funds Rate and the interest rate applicable thereto pursuant to Section
2.07 and (ii) in the case of such Bank, the Federal Funds Rate. If such Bank
shall repay to the Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.05. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the account of
its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the Agent (to
be given not later than two Domestic Business Days prior to the first
Borrowing), request that its Loans of a particular type be evidenced by a
separate Note in an amount equal to the aggregate unpaid principal amount of
such Loans. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely Loans of the relevant type. Each reference in this Agreement to the
"Note" of such Bank shall be deemed to refer to and include any or all of such
Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant to Section
3.01(c), the Agent shall deliver such Note to such Bank by hand, courier or
other similar means. Each Bank shall record the date, amount, type and maturity
of each Loan made by it and the date and amount of each payment of principal
made by the Borrower with respect thereto, and prior to any transfer of its Note
shall endorse on the schedule forming a part thereof appropriate notations to
evidence the foregoing information with respect to each such Loan then
outstanding; provided that the failure of any Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower hereunder or
under the Notes. Each Bank is hereby irrevocably authorized by the Borrower so
to endorse its Note and to attach to and make a part of such Note a continuation
of any such schedule as and when required.
SECTION 2.06. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall
bear interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
sum of the Base Rate for such day plus, if such day falls in a Level V Period,
0.50%. Such interest shall be payable for each Interest Period on the last day
thereof. Any overdue principal of or interest on any Base Rate Loan shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the sum of 2% plus the rate otherwise applicable to Base Rate Loans for such
day.
(b) Each CD Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the CD Margin for such day plus
the applicable Adjusted CD Rate; provided that if any CD Loan or any portion
thereof shall, as a result of clause (2)(b) of the definition of Interest
Period, have an Interest Period of less than 30 days, such portion shall bear
interest during such Interest Period at the rate applicable to Base Rate Loans
during such period. Such interest shall be payable for each Interest Period on
the last day thereof and, if such Interest Period is longer than 90 days, 90
days after the first day thereof. Any overdue principal of or interest on any
CD Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the sum of 2% plus the higher of (i) the sum of the CD
Margin for such day plus the Adjusted CD Rate applicable to such Loan and (ii)
the rate applicable to Base Rate Loans for such day.
"CD Margin" means for any day the percentage set forth below
opposite the Pricing Period during which such day falls:
Level I Period .4875%
Level II Period .5800%
Level III Period .6750%
Level IV Period .8000%
Level V Period 1.1750%
The "Adjusted CD Rate" applicable to any Interest Period means a
rate per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
__________
* The amount in brackets being rounded upward, if
necessary, to the next higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the rate
of interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum bid
at 10:00 A.M. (New York City time) (or as soon thereafter as practicable) on the
first day of such Interest Period by two or more New York certificate of deposit
dealers of recognized standing for the purchase at face value from each CD
Reference Bank of its certificates of deposit in an amount comparable to the
principal amount of the CD Loan of such CD Reference Bank to which such Interest
Period applies and having a maturity comparable to such Interest Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of new non-personal time deposits in dollars in New York City having a
maturity comparable to the related Interest Period and in an amount of $100,000
or more. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any Interest Period the net annual
assessment rate (rounded upward, if necessary, to the next higher 1/100 of 1%)
which is payable by a member of the Bank Insurance Fund classified as adequately
capitalized and within supervisory subgroup "A" (or a comparable successor
assessment risk classification) within the meaning of 12 C.F.R. 327.3(d) (or
any successor provision) to the Federal Deposit Insurance Corporation (or any
successor) for such Corporation's (or such successor's) insuring time deposits
at offices of such institution in the United States. The Adjusted CD Rate shall
be adjusted automatically on and as of the effective date of any change in the
Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for such
day plus the applicable London Interbank Offered Rate. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than three months, three months after the first day thereof.
"Euro-Dollar Margin" means for any day the percentage set forth
below opposite the Pricing Period during which such day falls:
Level I Period .3625%
Level II Period .4550%
Level III Period .5500%
Level IV Period .6750%
Level V Period 1.0500%
The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/100
of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal to
the principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank
to which such Interest Period is to apply and for a period of time comparable to
such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the date of actual payment, at a rate
per annum equal to the sum of 2% plus the higher of (i) the sum of the
Euro-Dollar Margin plus the London Interbank Offered Rate applicable to such
Loan and (ii) the Euro-Dollar Margin plus the quotient obtained (rounded upward,
if necessary, to the next higher 1/100 of 1%) by dividing (x) the average
(rounded upward, if necessary, to the next higher 1/100 of 1%) of the respective
rates per annum at which one day (or, if such amount due remains unpaid more
than three Euro-Dollar Business Days, then for such other period of time not
longer than six months as the Agent may select) deposits in dollars in an amount
approximately equal to such overdue payment due to each of the Euro-Dollar
Reference Banks are offered to such Euro-Dollar Reference Bank in the London
interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Dollar Reserve Percentage (or, if the circumstances
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per annum
equal to the sum of 2% plus the rate applicable to Base Rate Loans for such
day).
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of the
London Interbank Offered Rate for such Interest Period (determined in accordance
with Section 2.07(c) as if the related Money Market LIBOR Borrowing were a
Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted
by the Bank making such Loan in accordance with Section 2.03. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.03. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
(f) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower and the
participating Banks by telex, facsimile transmission or cable of each rate of
interest so determined, and its determination thereof shall be conclusive in the
absence of manifest error.
(g) Each Reference Bank agrees to use its best efforts to
furnish quotations to the Agent as contemplated by this Section. If any
Reference Bank does not furnish a timely quotation, the Agent shall determine
the relevant interest rate on the basis of the quotation or quotations furnished
by the remaining Reference Bank or Banks or, if none of such quotations is
available on a timely basis, the provisions of Section 8.01 shall apply.
SECTION 2.08. Fees.
(a) Commitment Fee. The Borrower shall pay to the Agent, for
the account of the Banks ratably in proportion to their Commitments, a
commitment fee at the rate of .05% per annum on the amount by which the
aggregate amount of the Commitments exceeds the aggregate outstanding principal
amount of the Loans. Such commitment fee shall accrue from and including the
Effective Date to but excluding the Termination Date (or earlier date of
termination of the Commitments in their entirety).
(b) Facility Fee. The Borrower shall pay to the Agent, for the
account of each Bank, a facility fee calculated for each day: (i) during a
Level I Period at the rate of .1375% per annum, (ii) during a Level II Period at
the rate of .17% per annum, (iii) during a Level III Period at the rate of .20%
per annum, (iv) during a Level IV Period at the rate of .325% per annum and (v)
during a Level V Period at the rate of .45% per annum. Such facility fee shall
accrue (i) from and including the Effective Date to but excluding the
Termination Date (or earlier date of termination of the Commitments in their
entirety), on the amount by which such Bank's Commitment (whether used or
unused) exceeds the aggregate outstanding principal amount of its Base Rate
Loans and (ii) from and including the Termination Date (or such earlier date of
termination) to but excluding the date on which such Bank's Loans shall be
repaid in their entirety, on the aggregate outstanding principal amount of such
Bank's Loans other than Base Rate Loans.
(c) Payments. Accrued fees under this Section shall be payable
quarterly in arrears on the last day of each September, December, March and June
and upon the date of termination of the Commitments in their entirety (and, if
later, the date the Loans shall be repaid in their entirety).
SECTION 2.09. Optional Termination or Reduction of Commitments.
The Borrower may, upon at least three Domestic Business Days' notice to the
Agent, (i) terminate the Commitments at any time, if no Loans are outstanding at
such time, or (ii) ratably reduce from time to time by an aggregate amount of
$25,000,000 or any larger multiple of $1,000,000, the aggregate amount of the
Commitments in excess of the aggregate outstanding principal amount of the
Loans.
SECTION 2.10. Termination of Commitments. The Commitments shall
terminate on the earlier of (i) the first Payment Date to occur under any of the
Receivables Purchase Agreements and (ii) the Termination Date, and any Loans
then outstanding (together with accrued interest thereon) shall be due and
payable on such date.
SECTION 2.11. Optional Prepayments. (a) The Borrower may, upon
one Domestic Business Day's notice to the Agent, prepay any Base Rate Borrowing
(or any Money Market Borrowing bearing interest at the Base Rate pursuant to
Section 8.01(a)) in whole at any time, or from time to time in part in amounts
aggregating $5,000,000 or any larger multiple of $1,000,000, by paying the
principal amount to be prepaid together with accrued interest thereon to the
date of prepayment. Each such optional prepayment shall be applied to prepay
ratably the Loans of the several Banks included in such Borrowing.
(b) Except as provided in Section 8.02, the Borrower may not
voluntarily prepay all or any portion of the principal amount of any Fixed Rate
Loan prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share (if any) of such prepayment and such notice shall
not thereafter be revocable by the Borrower.
SECTION 2.12. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the Loans and
of fees hereunder, not later than 2:00 P.M. (New York City time) on the date
when due, in Federal or other funds immediately available in New York City, to
the Agent at its address referred to in Section 9.01. The Agent will promptly
distribute to each Bank its ratable share of each such payment received by the
Agent for the account of the Banks. Whenever any payment of principal of, or
interest on, the Domestic Loans or of fees shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to the
next succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. Whenever any payment of
principal of, or interest on, the Money Market Loans shall be due on a day which
is not a Euro-Dollar Business Day, the date for payment thereof shall be
extended to the next succeeding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due from the Borrower to the
Banks hereunder that the Borrower will not make such payment in full, the Agent
may assume that the Borrower has made such payment in full to the Agent on such
date and the Agent may, in reliance upon such assumption, cause to be
distributed to each Bank on such due date an amount equal to the amount then due
such Bank. If and to the extent that the Borrower shall not have so made such
payment, each Bank shall repay to the Agent forthwith on demand such amount
distributed to such Bank together with interest thereon, for each day from the
date such amount is distributed to such Bank until the date such Bank repays
such amount to the Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If the Borrower makes any payment
of principal with respect to any Fixed Rate Loan (pursuant to Article VI or VIII
or otherwise) on any day other than the last day of the Interest Period
applicable thereto, or the end of an applicable period fixed pursuant to Section
2.07(d), or if the Borrower fails to borrow any Fixed Rate Loans after notice
has been given to any Bank in accordance with Section 2.04(a), the Borrower
shall reimburse each Bank within 15 days after demand for any resulting loss or
expense incurred by it (or by an existing or prospective Participant in the
related Loan), including (without limitation) any loss incurred in obtaining,
liquidating or employing deposits from third parties, but excluding loss of
margin for the period after any such payment or failure to borrow, provided that
such Bank shall have delivered to the Borrower a certificate as to the amount of
such loss or expense, which certificate shall be conclusive in the absence of
manifest error.
SECTION 2.14. Computation of Interest and Fees. Interest based
on the Prime Rate hereunder shall be computed on the basis of a year of 365 days
(or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. Withholding Tax Exemption. At least five Domestic
Business Days prior to the first date on which interest or fees are payable
hereunder for the account of any Bank, each Bank that is not incorporated under
the laws of the United States of America or a state thereof agrees that it will
deliver to the Borrower and the Agent two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, certifying in either case that such
Bank is entitled to receive payments under this Agreement and the Notes without
deduction or withholding of any United States federal income taxes. Each Bank
which so delivers a Form 1001 or 4224 further undertakes to deliver to the
Borrower and the Agent two additional copies of such form (or a successor form)
on or before the date that such form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent form so delivered
by it, and such amendments thereto or extensions or renewals thereof as may be
reasonably requested by the Borrower or the Agent, in each case certifying that
such Bank is entitled to receive payments under this Agreement and the Notes
without deduction or withholding of any United States federal income taxes,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Bank from duly completing and delivering any such form with respect
to it and such Bank advises the Borrower and the Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.
SECTION 2.16. Regulation D Compensation. Each Bank may require
the Borrower to pay, contemporaneously with each payment of interest onits Euro-
Dollar Loans, additional interest on the related Euro-Dollar Loan of such Bank
at a rate per annum determined by such Bank up to but not exceeding the excess
of (i)(A) the applicable London Interbank Offered Rate divided by (B) one minus
the Euro-Dollar Reserve Percentage over (ii) the applicable London Interbank
Offered Rate. Any Bank wishing to require payment of such additional interest
(x) shall so notify the Borrower and the Agent, in which case such additional
interest on the Euro-Dollar Loans of such Bank to the Borrower shall be payable
to such Bank at the place indicated in such notice with respect to each Interest
Period commencing at least four Euro-Dollar Business Days after the giving of
such notice and (y) shall notify the Borrower at least five Euro-Dollar Business
Days prior to each date on which interest is payable on its Euro-Dollar Loans of
the amount then due to such Bank under this Section.
SECTION 2.17. Termination of Commitments Under Existing
Agreement; Amendment of Receivables Purchase Agreements. (a) Each of the
parties to this Agreement that is also a party to the Existing Agreement agrees
that the commitments of the banks under the Existing Agreement shall terminate
on the Effective Date concurrently with the effectiveness of this Agreement
without notice to, or any further action by, any party thereunder.
(b) The Borrower, in its capacity as guarantor of the obligations of APL
and APD under the Receivables Purchase Agreements, consents to the amendment of
each of the Receivables Purchase Agreements as provided in Amendment
No. 3 thereto dated as of the date hereof.
ARTICLE III
CONDITIONS
SECTION 3.01. Effectiveness. This Agreement shall become
effective on the date (the "Effective Date") that each of the following
conditions shall have been satisfied (or waived in accordance with Section
9.06):
(a) receipt by the Agent of counterparts hereof signed
by each of the parties hereto (or, in the case of any party as to
which an executed counterpart shall not have been received,
receipt by the Agent in form satisfactory to it of telegraphic,
telex, facsimile transmission or other written confirmation from
such party of execution of a counterpart hereof by such party);
(b) receipt by the Agent of a certificate signed by an
Authorized Officer and dated the Effective Date, to the effect
that on such date (i) no Default or Potential Event of
Termination shall have occurred and be continuing and (ii) the
representations and warranties of the Borrower contained in this
Agreement shall be true;
(c) receipt by the Agent for the account of each Bank of
a duly executed Note dated on or before the Effective Date
complying with the provisions of Section 2.05;
(d) receipt by the Agent of an opinion of Peter A.V.
Huegel, Esq., Senior Counsel of the Borrower, substantially in
the form of Exhibit E hereto and covering such additional matters
relating to the transactions contemplated hereby as the Required
Banks may reasonably request, and any other opinion of other
counsel referred to therein in form and scope satisfactory to the
Agent;
(e) receipt by the Agent of an opinion of Davis Polk &
Wardwell, special counsel for the Agent, substantially in the
form of Exhibit F hereto and covering such additional matters
relating to the transactions contemplated hereby as the Required
Banks may reasonably request;
(f) receipt by the Agent of a copy of any consent or
approval of any Person which may be required in connection with
the transactions contemplated by this Agreement and the Notes;
(g) receipt by the Agent of a written waiver from each
party to the Existing Agreement that is not a party to this
Agreement, evidencing such party's waiver of any notice
requirement under Section 2.09 of the Existing Agreement in
connection with the termination of such party's commitment
thereunder;
(h) payment by the Borrower of all fees accrued to but
excluding the Effective Date under Section 2.08(d) of the
Existing Agreement;
(i) each of the Receivables Purchase Agreements shall
have been amended by an Amendment No. 3 thereto substantially in
the form of the draft thereof dated 3/22/94 heretofore delivered
to the Banks; and
(j) receipt by the Agent of all documents it may
reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Agreement and
the Notes, and any other matters relevant hereto, all in form and
substance satisfactory to the Agent;
provided that this Agreement shall not become effective or be binding on any
party hereto unless all of the foregoing conditions are satisfied not later than
April 8, 1994. The Agent shall promptly notify the Borrower and the Banks of
the Effective Date, and such notice shall be conclusive and binding on all
parties hereto.
SECTION 3.02. Borrowings. The obligation of any Bank to make a
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) receipt (or deemed receipt) by the Agent of a Notice
of Borrowing as required by Section 2.02 or 2.03, as the case may
be;
(b) the fact that, immediately after such Borrowing, the
aggregate outstanding principal amount of the Loans will not
exceed the aggregate amount of the Commitments;
(c) the fact that, immediately before and after such
Borrowing, no Default or Potential Event of Termination shall
have occurred and be continuing; and
(d) the fact that the representations and warranties of
the Borrower contained in this Agreement (except, in the case of
a Refunding Borrowing, the representations and warranties set
forth in Sections 4.04(b) and 4.05 as to any matter which has
theretofore been disclosed in writing by the Borrower to the
Banks) shall be true on and as of the date of such Borrowing.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the facts specified in clauses
(b), (c) and (d) of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of this
Agreement and the execution, delivery and performance by the Borrower of the
Notes, including the borrowing of the full amount of the Commitments hereunder,
are within the corporate powers of the Borrower, have been duly authorized by
all necessary corporate action, require no action by or in respect of, or filing
with, any governmental body, agency or official (including, without limitation,
MarAd) and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of incorporation or by-laws
of the Borrower or of any agreement, judgment, injunction, order, decree or
other instrument binding upon the Borrower or any of its Subsidiaries or result
in the creation or imposition of any Lien on any asset of the Borrower or any of
its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower, and the Notes, when executed and
delivered in accordance with this Agreement, will constitute valid and binding
obligations of the Borrower.
SECTION 4.04. Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of December 31, 1993 and the related consolidated
statements of income, cash flows and changes in redeemable preferred stock and
stockholders' equity for the fiscal year then ended, reported on by Arthur
Andersen & Co. and set forth in the Borrower's 1993 Form 10-K, a copy of which
has been delivered to each of the Banks, fairly present, in conformity with
generally accepted accounting principles, the consolidated financial position of
the Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such fiscal year.
(b) Since December 31, 1993 there has been no material adverse
change in the business, financial position, results of operations or prospects
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
SECTION 4.05. Litigation. There is no action, suit or
proceeding pending against, or to the knowledge of the Borrower threatened
against or affecting, the Borrower or any of its Subsidiaries before any court
or arbitrator or any governmental body, agency or official in which there is a
significant possibility of an adverse decision which could materially adversely
affect the business, financial position, results of operations or prospects of
the Borrower and its Consolidated Subsidiaries considered as a whole or which in
any manner draws into question the validity of this Agreement or the Notes.
SECTION 4.06. Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the minimum funding standards of ERISA
and the Internal Revenue Code with respect to each Plan and is in compliance in
all material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (iii)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.
SECTION 4.07. Environmental Matters. In the ordinary course of
its business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties presently
or previously owned, any capital or operating expenditures required to achieve
or maintain compliance with environmental protection standards imposed by law or
as a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted thereat and any actual or potential liabilities to third parties,
including employees, and any related costs and expenses). On the basis of this
review, the Borrower has reasonably concluded that Environmental Laws are
unlikely to have a material adverse effect on the business, financial condition,
results of operations or prospects of the Borrower and its Consolidated
Subsidiaries, considered as a whole.
SECTION 4.08. Taxes. The Borrower and its Subsidiaries have
filed all United States Federal income tax returns and all other material tax
returns which are required to be filed by them and have paid all taxes due
pursuant to such returns or pursuant to any assessment received by the Borrower
or any Subsidiary, other than taxes contested in good faith by the Borrower or
such Subsidiary. The charges, accruals and reserves on the books of the Borrower
and its Subsidiaries in respect of taxes or other governmental charges are, in
the opinion of the Borrower, adequate.
SECTION 4.09. Subsidiaries. Each of the Borrower's corporate
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted, the
absence of which good standing and governmental licenses, authorizations,
consents and approvals would have a material adverse effect on the business,
financial position, results of operations or prospects of the Borrower and its
Consolidated Subsidiaries, considered as a whole.
SECTION 4.10. Not an Investment Company. The Borrower is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
SECTION 4.11. MarAd Requirements. The Borrower and its
Subsidiaries are in compliance in all material respects with the terms of all
agreements currently in effect between the Borrower or any Subsidiary and MarAd,
and with all applicable regulations of MarAd with respect to which agreements
and regulations noncompliance would have a material adverse effect on the
business, financial position, results of operations or prospects of the Borrower
and its Consolidated Subsidiaries taken as a whole, including without limitation
all agreements and regulations relating to construction-differential subsidy and
operating-differential subsidy, as such terms are defined by MarAd.
SECTION 4.12. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true and accurate in all material respects on the date as of which
such information is stated or certified; it being understood that (i) any
projections included in such information represent, at the time such projections
are furnished by the Borrower, the Borrower's best good faith estimate of the
information shown and do not constitute a representation that the results
portrayed in such projections will in fact be achieved and (ii) any business
plan included in such information represents the Borrower's good faith
intention, at the time such business plan is furnished by the Borrower, and does
not constitute a representation that such plan will in fact be implemented. The
Borrower has disclosed to the Banks in writing any and all facts which
materially and adversely affect or may affect (to the extent the Borrower can
now reasonably foresee), the business, financial position or results of
operations of the Borrower and its Consolidated Subsidiaries, taken as a whole,
or the ability of the Borrower to perform its obligations under this Agreement
or the Notes.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to each of
the Banks:
(i) as soon as available and in any event within 105
days after the end of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such fiscal year and the related
consolidated statements of income, cash flows and changes in
redeemable preferred stock and stockholders' equity for such
fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on in a manner
acceptable to the Securities and Exchange Commission by Arthur
Andersen & Co. or other independent public accountants of
nationally recognized standing; provided that, so long as the
Borrower is subject to the reporting requirements of the Exchange
Act, the requirements of this clause (i) may be satisfied by
delivering to each Bank a copy of the Borrower's report on Form
10-K for such fiscal year, together with a copy of the Borrower's
annual report to shareholders for such fiscal year;
(ii) as soon as available and in any event within 53 days
after the end of each of the first three quarters of each fiscal
year of the Borrower, a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as of the end of such
quarter and the related consolidated statements of income, cash
flows and changes in redeemable preferred stock and stockholders'
equity for such quarter and for the portion of the Borrower's
fiscal year ended at the end of such quarter, setting forth in
each case in comparative form the figures for the corresponding
quarter and the corresponding portion of the Borrower's previous
fiscal year, all certified (subject to normal year-end
adjustments) as to fairness of presentation, generally accepted
accounting principles and consistency by an Authorized Officer;
provided that, so long as the Borrower is subject to the
reporting requirements of the Exchange Act, the requirements of
this clause (ii) may be satisfied by delivering to each Bank a
copy of the Borrower's report on Form 10-Q for such quarter,
together with a copy of the Borrower's report (if any) to
shareholders for such quarter;
(iii) simultaneously with the delivery of each set of
financial statements referred to in clauses (i) and (ii) above, a
certificate of an Authorized Officer (x) setting forth in
reasonable detail the calculations required to establish whether
the Borrower was in compliance with the requirements of Sections
5.06, 5.10, 5.11 and 5.12(b) on the date of such financial
statements and (y) stating whether any Default, Event of
Termination or Potential Event of Termination exists on the date
of such certificate and, if any Default, Event of Termination or
Potential Event of Termination then exists, setting forth the
details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
(iv) simultaneously with the delivery of each set of
financial statements referred to in clause (i) above, a statement
of the firm of independent public accountants which reported on
such statements (x) as to whether anything has come to their
attention to cause them to believe that any Default, Event of
Termination or Potential Event of Termination existed on the date
of such statements and (y) confirming the calculations set forth
in the officers' certificate delivered simultaneously therewith
pursuant to clause (iii) above;
(v) promptly upon the mailing thereof to the
shareholders of the Borrower generally, copies of all financial
statements, reports and proxy statements so mailed;
(vi) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and
reports on Forms 10-K, 10-Q and 8-K (or their equivalents) which
the Borrower shall have filed with the Securities and Exchange
Commission;
(vii) promptly after an Authorized Officer obtains knowledge
of any change in the rating by either S&P or Moody's of the
Borrower's senior unsecured long-term public debt, or of any
public announcement by such rating agency that such debt has been
placed under surveillance with possible negative implications or
review for possible downgrade, written notice of such change or
such placement under surveillance or review, setting forth the
details thereof; and
(viii) if and when any member of the ERISA Group (A) gives or
is required to give notice to the PBGC of any "reportable event"
(as defined in Section 4043 of ERISA) with respect to any Plan
which might constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event
given or required to be given to the PBGC; (B) receives notice of
complete or partial withdrawal liability under Title IV of ERISA
or notice that any Multiemployer Plan is in reorganization, is
insolvent or has been terminated, a copy of such notice; (C)
receives notice from the PBGC under Title IV of ERISA of an
intent to terminate, impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or appoint a trustee
to administer any Plan, a copy of such notice; (D) applies for a
waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code, a copy of such application; (E) gives
notice of intent to terminate any Plan under Section 4041(c) of
ERISA, a copy of such notice and other information filed with the
PBGC; (F) gives notice of withdrawal from any Plan pursuant to
Section 4063 of ERISA, a copy of such notice; or (G) fails to
make any payment or contribution to any Plan or Multiemployer
Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted
or could result in the imposition of a Lien or the posting of a
bond or other security, a certificate of an Authorized Officer
setting forth details as to such occurrence and action, if any,
which the Borrower or the applicable member of the ERISA Group is
required or proposes to take.
(b) The Borrower will deliver to each of the Banks:
(i) forthwith upon the occurrence of any Default, Event
of Termination or Potential Event of Termination, a certificate
of an Authorized Officer setting forth the details thereof and
the action which the Borrower is taking or proposes to take with
respect thereto;
(ii) promptly upon the occurrence thereof, notice and copies
of any amendment or modification of, or any waiver given by MarAd
with respect to, any agreement to which MarAd and the Borrower or
any Subsidiary are parties, other than amendments, modifications
and waivers that relate solely to the ordinary operational
aspects of the business of the Borrower or such Subsidiary; and
(iii) from time to time such additional information regarding
the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Bank, may
reasonably request.
SECTION 5.02. Payment of Obligations. The Borrower (i) will pay
and discharge, and will cause each Material Subsidiary to pay and discharge, at
or before maturity, all their respective material obligations and liabilities,
including, without limitation, tax liabilities, except where the same may be
contested in good faith by appropriate proceedings, and (ii) will maintain, and
will cause each Material Subsidiary to maintain, in accordance with generally
accepted accounting principles, appropriate reserves for the accrual of any of
the same.
SECTION 5.03. Maintenance of Property; Insurance. (a) The
Borrower will keep, and will cause each Material Subsidiary to keep, all
property useful and necessary in its business in good working order and
condition, ordinary wear and tear, lay-up and obsolescence excepted.
(b) The Borrower (i) will maintain, and will cause each Material
Subsidiary to maintain (in the case of property other than vessels chartered to
it, either in the name of the Borrower or in such Material Subsidiary's own
name), with financially sound and reputable insurance companies, insurance on
all their property in at least such amounts and against at least such risks as
are usually insured against in the same general area and by companies engaged in
the same or a similar business and (ii) will furnish to the Banks, upon written
request from any Bank, full information as to the insurance carried. In
addition, within 90 days after the annual renewal of any insurance covering any
vessel owned or chartered by APL, the Borrower or any other Subsidiary required
under any agreement between APL, the Borrower or such Subsidiary and MarAd, the
Borrower shall cause a letter from an independent marine insurance broker to be
delivered to the Banks describing such renewed insurance coverage, confirming
that such insurance coverage complies with the requirements of the applicable
MarAd agreement and identifying each underwriter and each protection and
indemnity club. The Required Banks may, at any time after receipt of any such
letter, object in a written notice to the Borrower to the underwriter or any
underwriter providing such insurance, whereupon the Borrower shall within 60
days after such objection, provided there is a reasonable basis for such
objection, cause such underwriter to be replaced with an underwriter
satisfactory to the Required Banks or provide substitute insurance on a basis
satisfactory to the Required Banks.
SECTION 5.04. Conduct of Business, Maintenance of Existence and
Compliance with Laws. (a) The Borrower (i) will continue, and will cause each
Material Subsidiary to continue, to engage in business in the fields of surface
transportation and cargo distribution as now conducted by the Borrower and the
Material Subsidiaries, and (ii) will preserve, renew and keep in full force and
effect, and will cause each Material Subsidiary to preserve, renew and keep in
full force and effect, their respective corporate existence and their respective
rights, privileges and franchises necessary or desirable in the normal conduct
of business, except as permitted by Section 5.08.
(b) The Borrower will make all good faith efforts to comply, and
will cause each Material Subsidiary to make all good faith efforts to comply, in
all material respects with all material applicable laws, ordinances, rules,
regulations and requirements of governmental authorities (including, without
limitation, regulations of MarAd, Environmental Laws and ERISA and the rules and
regulations thereunder), except where the necessity of compliance therewith is
contested in good faith by appropriate proceedings.
(c) The Borrower will comply, and will cause each Material
Subsidiary to comply, in all material respects with the terms of all agreements
from time to time in effect between the Borrower or such Material Subsidiary and
MarAd, and with all applicable regulations of MarAd with respect to which
agreements and regulations non-compliance would have a material adverse effect
upon the business, financial position, results of operations or prospects of the
Borrower and its Consolidated Subsidiaries taken as a whole, including without
limitation all agreements and regulations relating to construction-differential
subsidy and operating-differential subsidy, as such terms may be defined by
MarAd.
SECTION 5.05. Inspection of Property, Books and Records. The
Borrower will keep, and will cause each Material Subsidiary to keep, proper
books of record and account in which full, true and correct entries shall be
made of all dealings and transactions in relation to its business and
activities; and the Borrower will permit, and will cause each Material
Subsidiary to permit, representatives of any Bank at such Bank's expense to
visit and inspect any of their respective properties, to examine and make
abstracts from any of their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and independent public accountants, all at such reasonable times and
as often as may reasonably be desired.
SECTION 5.06. Minimum Consolidated Tangible Net Worth.
Consolidated Tangible Net Worth will at no time be less than Minimum Adjusted
Net Worth. "Minimum Adjusted Net Worth" means, at any date, the amount of
$438,300,000 adjusted from time to time as follows: at the end of each of the
Borrower's fiscal years ending after December 31, 1993, Minimum Adjusted Net
Worth shall be increased (but not decreased) by 50% of the positive Consolidated
Net Income After Tax (if any) for such fiscal year.
SECTION 5.07. Negative Pledge. The Borrower will not, and will
not permit any of its Subsidiaries to, create, assume or suffer to exist any
Lien on any asset (including the capital stock of any Subsidiary) now owned or
hereafter acquired by it, without making effective provisions whereby the
Commitments and the Notes shall be equally and ratably secured thereby, provided
that the foregoing shall not be applicable to:
(a) Liens existing on December 31, 1993 and described in
Schedule I hereto;
(b) other Liens existing on December 31, 1993 on assets
having a value not in excess of $500,000 individually or
$10,000,000 in the aggregate;
(c) Liens imposed by operation of maritime law arising
in the ordinary course of its business;
(d) any Lien existing on any asset of any corporation at
the time such corporation becomes a Subsidiary and not created in
contemplation of such event;
(e) any Lien on any asset securing Debt incurred or
assumed for the purpose of financing all or any part of the cost
of acquiring such asset, provided that such Lien attaches to such
asset before the later of (i) 180 days after the acquisition
thereof or (ii) the end of the tax year of the Borrower or the
acquiring Subsidiary, as the case may be, during which it
acquired such asset (a "Purchase Money Lien");
(f) any Lien on any asset of any corporation existing at
the time such corporation is merged or consolidated with or into
the Borrower or any Subsidiary and not created in contemplation
of such event;
(g) any Lien existing on any asset prior to the
acquisition thereof by the Borrower or any Subsidiary and not
created in contemplation of such acquisition;
(h) any Lien granted or imposed in connection with any
writ of execution being contested in good faith and securing
amounts not in excess of $5,000,000 individually or $25,000,000
in the aggregate; provided that execution of such writ is stayed
during the pendency of such contest;
(i) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by
any of the foregoing clauses of this Section, provided that such
Debt is not increased and is not secured by any additional
assets;
(j) any Lien created pursuant to the Receivables
Purchase Agreements (or any other receivables purchase agreement
entered into by APL or APD and all the Banks);
(k) any Off-Site Real Estate Improvement Lien on real
estate securing non-recourse Debt or other obligations in an
aggregate principal amount not exceeding 75% of the pro forma
appraised value of such real estate and pertaining to off-site
improvements which result in an equal or greater increase in the
value of such real estate;
(l) mechanics' liens, suppliers' liens and materialmens'
liens arising in the ordinary course of business; and
(m) other Liens arising in the ordinary course of its
business which (i) do not secure Debt, (ii) do not secure any
single obligation, or any series of related obligations,
exceeding $75,000,000 in amount and (iii) do not in the aggregate
materially detract from the value of its assets or materially
impair the use thereof in the operation of its business.
SECTION 5.08. Consolidations, Mergers and Sales of Assets. (a)
The Borrower will not consolidate or merge with any other Person; provided that
the Borrower may merge with another Person if (i) the Borrower is the
corporation surviving such merger and (ii) immediately after giving effect to
such merger, no Default, Event of Termination or Potential Event of Termination
shall have occurred and be continuing.
(b) Except for sales of inventory in the ordinary course of
business, sales of "margin stock" within the meaning of Regulation U for fair
value as determined in good faith by the board of directors of the Borrower or
transfers of assets to the Borrower or any Wholly-Owned Subsidiary, neither the
Borrower nor any Subsidiary will sell, lease or otherwise transfer any asset
after the Effective Date without the consent of the Required Banks unless the
aggregate value at cost of the remaining assets being used at the time in lines
of business in which the Borrower and its Subsidiaries were engaged at December
31, 1993 is at least 66 2/3% of Consolidated Assets as of December 31, 1993.
Any transfer of assets by any Subsidiary to the Borrower and any transfer of
assets by the Borrower to any Subsidiary shall be on terms and conditions at
least as favorable to the Borrower as the terms and conditions that would apply
in a similar transaction with a party which is not affiliated with the Borrower.
(c) The Borrower will not permit any of its Subsidiaries to
consolidate or merge with any other Person unless the Person surviving such
consolidation or merger is the Borrower or a Wholly-Owned Subsidiary.
(d) Notwithstanding anything to the contrary in this Section,
the Borrower will at all times own, either directly or indirectly, all of the
outstanding shares of capital stock or other ownership interests of each of APL
and APD (exclusive of directors' qualifying shares).
SECTION 5.09. Use of Proceeds. (a) The proceeds of the Loans
made under this Agreement will be used by the Borrower for general corporate
purposes.
(b) None of such proceeds will be used in violation of any
applicable law or regulation.
SECTION 5.10. Consolidated Interest Coverage Ratio. At the end
of each fiscal quarter of the Borrower, the Consolidated Interest Coverage Ratio
for the four consecutive fiscal quarters of the Borrower then ended shall not be
less than 3.0 to 1.
The "Consolidated Interest Coverage Ratio" means the ratio
determined pursuant to the following formula:
CICR = CPE + IE + DP
IE
CICR = Consolidated Interest Coverage Ratio
CPE = Consolidated Pretax Earnings
IE = Interest Expense
DP = Depreciation
SECTION 5.11. Consolidated Leverage Ratio. The Consolidated
Leverage Ratio at any time during each period specified below will not be
greater than the ratio set forth opposite such period.
Period Ratio
Effective Date through 12/31/1996 1.4 to 1
1/1/1997 through 12/31/1997 1.3 to 1
1/1/1998 and thereafter 1.2 to 1
The "Consolidated Leverage Ratio" applicable at any time means
the ratio determined pursuant to the following formula:
CLR = TBF + CGD
CTNW
CLR = Consolidated Leverage Ratio
TBF = Total Borrowed Funds
CGD = Consolidated Guaranteed Debt
CTNW = Consolidated Tangible Net Worth
SECTION 5.12. Restrictions on Subsidiary and Secured Debt. (a)
The Borrower will not at any time permit any of its Subsidiaries to create,
incur or assume any Debt except (i) Debt secured by Liens permitted by
Section 5.07, (ii) unsecured Debt incurred in the ordinary course of business,
consistent with past practice, in an aggregate outstanding principal amount not
exceeding $10,000,000 at any time and (iii) Debt of any Subsidiary owing to the
Borrower or to any other Subsidiary.
(b) The aggregate outstanding principal amount of all secured Debt of the
Borrower and all Debt of its Subsidiaries (except Debt owed by any Subsidiary to
the Borrower or to any other Subsidiary) will not at any time exceed 40% of
Consolidated Net Property and Equipment.
SECTION 5.13. Capital Contributions to Subsidiaries. The
Borrower will not make any contribution (other than contributions of the capital
stock of another Subsidiary) to the capital of APL or APD if, after giving
effect thereto, the aggregate amount of such contributions made after December
31, 1993 would exceed $10,000,000.
SECTION 5.14. No New Restrictions on Subsidiary Dividends, Etc.
Except as required by applicable law, Borrower will not agree, or permit any of
its Subsidiaries to agree, to restrict or otherwise limit the payment of
dividends or any other transfer of funds or assets from any Subsidiary directly,
or indirectly through one or more other Subsidiaries, to the Borrower.
SECTION 5.15. Investments; Acquisitions. Neither the Borrower
nor any Subsidiary will make or acquire any Investment in any Person or acquire
all or substantially all of the business or assets of any Person other than:
(a) Investments existing on December 31, 1993 in their
respective Subsidiaries;
(b) capital contributions permitted by Section 5.13;
(c) loans (i) from any Subsidiary to the Borrower or
(ii) from the Borrower or any Subsidiary to its respective
Subsidiaries;
(d) Investments made by the Borrower or any Subsidiary
in connection with its cash management policies and practices
conducted in the ordinary course of business, consistent with
reasonable business practice, provided that, in each case, such
Investment matures within three years from the date of
acquisition thereof by the Borrower or such Subsidiary; and
(e) any Investments not otherwise permitted by the
foregoing clauses of this Section and any acquisition of all or
substantially all of the business or assets of any Person if,
after giving effect thereto, the aggregate amount of all
Investments and acquisitions made after December 31, 1993 as
permitted by this clause (e) does not exceed $100,000,000.
For purposes of clause (e) above, the amount of any Investment or acquisition at
any date shall be the original cost thereof less any return of capital with
respect thereto.
ARTICLE VI
DEFAULTS AND EVENTS OF TERMINATION
SECTION 6.01. Events of Default. If one or more of the
following events shall have occurred and shall, at a time when one or more Loans
is outstanding under this Agreement, be continuing (any such event which is
continuing at such a time being herein called an "Event of Default"):
(a) default in the payment when due of any principal of
or interest on any Loan, any fee or any other amount payable
hereunder;
(b) the Borrower shall fail to observe or perform any
covenant contained in Sections 5.06, 5.07, 5.08 (other than
Section 5.08(b)) or 5.10 through 5.15, inclusive;
(c) the Borrower shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than
those covered by clause (a) or (b) above) for 10 days after
written notice thereof has been given to the Borrower by the
Agent at the request of any Bank;
(d) any representation, warranty, certification or
statement made by the Borrower in this Agreement or in any
certificate, financial statement or other document delivered
pursuant to this Agreement shall prove to have been incorrect in
any material respect when made (or deemed made);
(e) the Borrower or any Subsidiary shall fail to make
any payment in respect of any Debt (other than (i) Debt the
aggregate principal amount of which does not exceed $15,000,000
and (ii) the Loans) when due or within any applicable grace
period;
(f) any event or condition shall occur which results in
the acceleration of the maturity of any Debt of the Borrower or
any Subsidiary (other than (i) Debt the aggregate principal
amount of which does not exceed $15,000,000 and (ii) the Loans)
or enables (or, with the giving of notice or lapse of time or
both, would enable) the holder of such Debt or any Person acting
on such holder's behalf to accelerate the maturity thereof;
(g) MarAd shall give notice of its intent to terminate
(by reason of APL's failure to comply therewith) the
Operating-Differential Subsidy Agreement, Contract No.
MA/MSB-417, dated December 30, 1977, between APL and MarAd, as
amended from time to time, entered into in accordance with Title
VI of the Merchant Marine Act of 1936, as amended from time to
time;
(h) the Borrower or any Material Subsidiary shall
commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall
consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general
assignment for the benefit of creditors, or shall fail generally
to pay its debts as they become due, or shall take any corporate
action to authorize any of the foregoing;
(i) an involuntary case or other proceeding shall be
commenced against the Borrower or any Material Subsidiary seeking
liquidation, reorganization or other relief with respect to it or
its debts under any bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and
unstayed for a period of 60 days; or an order for relief shall be
entered against the Borrower or any Material Subsidiary under the
federal bankruptcy laws as now or hereafter in effect;
(j) any member of the ERISA Group shall fail to pay when
due an amount or amounts aggregating in excess of $15,000,000
which it shall have become liable to pay under Title IV of ERISA;
or notice of intent to terminate a Material Plan shall be filed
under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the
PBGC shall institute proceedings under Title IV of ERISA to
terminate, to impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any Material Plan must be terminated; or
there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with
respect to, one or more Multiemployer Plans which could cause one
or more members of the ERISA Group to incur a current payment
obligation in excess of $10,000,000;
(k) a judgment or order for the payment of money in
excess of 5% of Consolidated Tangible Net Worth as shown on the
then most recent balance sheet of the Borrower delivered to the
Banks under Section 4.04 or 5.01 shall be rendered against the
Borrower or any Material Subsidiary and such judgment or order
shall continue unsatisfied and unstayed for a period of 10 days;
or
(l) a Change in Control shall occur;
then, and in every such event, the Agent shall (i) if requested by Banks having
more than 50% in aggregate amount of the Commitments, by notice to the Borrower
terminate the Commitments and they shall thereupon terminate, and (ii) if
requested by Banks holding Notes evidencing more than 50% in aggregate principal
amount of the Loans, by notice to the Borrower declare the Notes (together with
accrued interest thereon) to be, and the Notes shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower; provided that if
any of the Events of Default specified in clause (h) or (i) above occurs with
respect to the Borrower, then without any notice to the Borrower or any other
act by the Agent or the Banks, the Commitments shall thereupon terminate and the
Notes (together with accrued interest thereon) shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower.
SECTION 6.02. Notice of Default. The Agent shall give notice to
the Borrower under Section 6.01(c) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.
SECTION 6.03. Events of Termination. If one or more of the
events listed in Section 6.01 shall have occurred and, at a time when no Loans
are outstanding under this Agreement, shall be continuing (any such event which
is continuing at such a time being herein called an "Event of Termination"),
then the Agent shall, if requested by Banks having more than 50% in aggregate
amount of the Commitments, by notice to the Borrower terminate the Commitments
and they shall thereupon terminate; provided that, if any of the events
specified in Section 6.01(h) or (i) occurs with respect to the Borrower, then
without any notice to the Borrower or any other act by the Agent or the Banks,
the Commitments shall thereupon terminate.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement or any Note as are
delegated to the Agent by the terms hereof or thereof, together with all such
powers as are reasonably incidental thereto.
SECTION 7.02. Agent and Affiliates. Morgan Guaranty Trust
Company of New York shall have the same rights and powers under this Agreement
and its Note as any other Bank and may exercise or refrain from exercising the
same as though it were not the Agent, and Morgan Guaranty Trust Company of New
York and its affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrower or any Subsidiary or affiliate
of the Borrower as if it were not the Agent hereunder.
SECTION 7.03. Action by Agent. The obligations of the Agent
under this Agreement or any Note are only those expressly set forth therein.
Without limiting the generality of the foregoing, the Agent shall not be
required to take any action with respect to any Default, Event of Termination or
Potential Event of Termination except as expressly provided in Article VI.
SECTION 7.04. Consultation with Experts. The Agent may consult
with legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agent. Neither the Agent nor any of
its directors, officers, agents, or employees shall be liable for any action
taken or not taken by it in connection herewith (i) with the consent or at the
request of the Required Banks or (ii) in the absence of its own gross negligence
or willful misconduct. Neither the Agent nor any of its directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with this Agreement, any Note or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of the Borrower;
(iii) the satisfaction of any condition specified in Article III, except receipt
of items required to be delivered to the Agent; or (iv) the validity,
effectiveness or genuineness of this Agreement or any Note or any other
instrument or writing furnished in connection therewith. The Agent shall not
incur any liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex, facsimile
transmission or similar writing) believed by it to be genuine or to be signed by
the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Agent (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from the Agent's gross negligence or willful misconduct) that the Agent
may suffer or incur in connection with this Agreement or any Note or any action
taken or omitted by the Agent thereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.08. Successor Agent. The Agent may resign at any time
by giving written notice thereof to the Banks and the Borrower. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Agent subject to the consent of the Borrower. If no successor Agent shall have
been so appointed by the Required Banks with the consent of the Borrower, and
shall have accepted such appointment, within 30 days after the retiring Agent
gives notice of resignation, then the retiring Agent may, on behalf of the
Banks, appoint a successor Agent, which shall be a commercial bank organized or
licensed under the laws of the United States of America or of any State thereof
and having a combined capital and surplus of at least $100,000,000. Upon the
acceptance of its appointment as Agent under this Agreement and the Notes by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations under this Agreement
and the Notes. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent.
SECTION 7.09. Agent's Fee. The Borrower shall pay to the Agent
for its own account fees in the amounts and at the times previously agreed upon
between the Borrower and the Agent.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any Fixed
Rate Borrowing:
(a) the Agent is advised by the Reference Banks that
deposits in dollars (in the applicable amounts) are not being
offered to the Reference Banks in the relevant market for such
Interest Period, or
(b) in the case of a Committed Borrowing, Banks having
50% or more of the aggregate amount of the Commitments advise the
Agent that the Adjusted CD Rate or the London Interbank Offered
Rate, as the case may be, as determined by the Agent will not
adequately and fairly reflect the cost to such Banks of funding
their CD Loans or Euro-Dollar Loans, as the case may be, for such
Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make CD
Loans or Euro-Dollar Loans, as the case may be, shall be suspended. Unless the
Borrower notifies the Agent at least two Domestic Business Days before the date
of any Fixed Rate Borrowing for which a Notice of Borrowing has previously been
given that it elects not to borrow on such date, (i) if such Fixed Rate
Borrowing is a Committed Borrowing, such Borrowing shall instead be made as a
Base Rate Borrowing and (ii) if such Fixed Rate Borrowing is a Money Market
LIBOR Borrowing, the Money Market LIBOR Loans comprising such Borrowing shall
bear interest for each day from and including the first day to but excluding the
last day of the Interest Period applicable thereto at the Base Rate for such
day.
SECTION 8.02. Illegality. If, on or after the date hereof, the
adoption of any applicable law, rule or regulation, or any change therein, or
any change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Euro-Dollar Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall make it unlawful
or impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain
or fund its Euro-Dollar Loans and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make Euro-Dollar Loans shall be suspended. Before giving any
notice to the Agent pursuant to this Section, such Bank shall designate a
different Euro-Dollar Lending Office if such designation will avoid the need for
giving such notice and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. If such Bank shall determine that it may not
lawfully continue to maintain and fund any of its outstanding Euro-Dollar Loans
to maturity and shall so specify in such notice, the Borrower shall immediately
prepay in full the then outstanding principal amount of each such Euro-Dollar
Loan, together with accrued interest thereon. Concurrently with prepaying each
such Euro-Dollar Loan, the Borrower shall borrow a Base Rate Loan in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other
Banks), and such Bank shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on or
after (x) the date hereof, in the case of any Committed Loan or any obligation
to make Committed Loans or (y) the date of the related Money Market Quote, in
the case of any Money Market Loan, the adoption of any applicable law, rule or
regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Applicable Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:
(i) shall subject any Bank (or its Applicable Lending
Office) to any tax, duty or other charge with respect to its
Fixed Rate Loans, its Note or its obligation to make Fixed Rate
Loans, or shall change the basis of taxation of payments to any
Bank (or its Applicable Lending Office) of the principal of or
interest on its Fixed Rate Loans or any other amounts due under
this Agreement in respect of its Fixed Rate Loans or its
obligation to make Fixed Rate Loans (except for changes in the
rate of tax on the overall net income of such Bank or its
Applicable Lending Office imposed by the jurisdiction in which
such Bank's principal executive office or Applicable Lending
Office is located); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any such requirement imposed by
the Board of Governors of the Federal Reserve System, but
excluding (A) with respect to any CD Loan any such requirement
included in an applicable Domestic Reserve Percentage and (B)
with respect to any Euro-Dollar Loan, any such requirement with
respect to which such Bank is entitled to compensation during the
relevant Interest Period under Section 2.16), special deposit,
insurance assessment (excluding, with respect to any CD Loan, any
such requirement reflected in an applicable Assessment Rate) or
similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Bank (or its Applicable
Lending Office) or shall impose on any Bank (or its Applicable
Lending Office) or on the United States market for certificates
of deposit or the London interbank market any other condition
affecting its Fixed Rate Loans, its Note or its obligation to
make Fixed Rate Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Applicable Lending Office) of making or maintaining any Fixed Rate Loan, or
to reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Agent), the Borrower shall pay to
such Bank such additional amount or amounts as will compensate such Bank for
such increased cost or reduction; provided that the Borrower shall not be
obligated to pay such compensation for any period that is more than 90 days
before such Bank notifies the Borrower pursuant to subsection (c) of this
Section of the event that entitles such Bank to such compensation.
(b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or any request
or directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on capital of such Bank (or its Parent) as
a consequence of such Bank's obligations hereunder to a level below that which
such Bank (or its Parent) could have achieved but for such adoption, change,
request or directive (taking into consideration its policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, within 15 days after demand by such Bank (with a copy to the
Agent), the Borrower agrees to pay to such Bank such additional amount or
amounts as will compensate such Bank (or its Parent) for such reduction;
provided that the Borrower shall not be obligated to pay such compensation for
any period that is more than 90 days before such Bank notifies the Borrower
pursuant to subsection (c) of this Section of the event that entitles such Bank
to such compensation.
(c) Each Bank will promptly notify the Borrower and the Agent of
any event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate a
different Applicable Lending Office if such designation will avoid the need for,
or reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth the additional amount
or amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods.
SECTION 8.04. Base Rate Loans Substituted for Affected Fixed
Rate Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans has
been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation from the Borrower under Section 8.03(a) and the Borrower shall, by
at least five Euro-Dollar Business Days' prior notice to such Bank through the
Agent, have elected that the provisions of this Section shall apply to such
Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:
(a) all Loans which would otherwise be made by such Bank
as CD Loans or Euro-Dollar Loans, as the case may be, shall be
made instead as Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Fixed Rate
Loans of the other Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as
the case may be, has been repaid, all payments of principal which
would otherwise be applied to repay such Fixed Rate Loans shall
be applied to repay its Base Rate Loans instead.
SECTION 8.05. Substitution of Bank. If (i) the obligation of
any Bank to make Euro-Dollar Loans has been suspended pursuant to Section 8.02
or (ii) any Bank has demanded compensation under Section 8.03, the Borrower
shall have the right, with the assistance of the Agent, to seek a mutually
satisfactory substitute bank or banks (which may be one or more of the Banks) to
purchase the Note and assume the Commitment of such Bank (and its obligations
under each of the Receivables Purchase Agreements then in effect) substantially
as contemplated by Section 9.07(c).
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party: (x) in the case of the Borrower or the Agent, at its address, telex
number or facsimile number set forth on the signature pages hereof, (y) in the
case of any Bank, at its address or telex number set forth in its Administrative
Questionnaire or (z) in the case of any party, such other address, telex number
or facsimile number as such party may hereafter specify for the purpose by
notice to the Agent and the Borrower. Each such notice, request or other
communication shall be effective (i) if given by telex, when such telex is
transmitted to the telex number specified in this Section and the appropriate
answerback is received, (ii) if given by mail, 72 hours after such communication
is deposited in the mails with first class postage prepaid, addressed as
aforesaid or (iii) if given by any other means, when delivered at the address
specified in this Section; provided that notices to the Agent under Article II
or Article VIII shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or
any Bank in exercising any right, power or privilege under this Agreement or any
Note shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies therein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 9.03. Expenses; Documentary Taxes. The Borrower shall
pay (i) all reasonable out-of-pocket expenses of the Agent, including all fees
and disbursements of Davis Polk & Wardwell, special counsel for the Agent, in
connection with the preparation of this Agreement, any waiver or consent
hereunder or any amendment hereof or any actual or alleged Default, Potential
Event of Termination or Event of Termination hereunder and (ii) if an Event of
Default or an Event of Termination occurs, all out-of-pocket expenses incurred
by the Agent and each Bank, including expenses of investigation and fees and
disbursements of counsel (which counsel may be an employee of such Bank, in
which case such expenses may include allocated direct costs of such internal
counsel), in connection with such Event of Default or such Event of Termination
and any collection, bankruptcy, insolvency and other enforcement proceedings
resulting therefrom. The Borrower shall indemnify each Bank against any
transfer taxes, documentary taxes, assessments or charges made by any
governmental authority by reason of the execution and delivery of this Agreement
or the Notes. To the extent permitted by law, all unpaid fees and expenses shall
bear interest, payable on demand, for each day from and after the tenth Domestic
Business Day following the date an invoice therefor is delivered to the Borrower
to but excluding the date of payment at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
SECTION 9.04. Indemnification. The Borrower agrees to indemnify
each Bank and hold each Bank harmless from and against any and all liabilities,
losses, damages, costs and expenses of any kind, including, without limitation,
settlement costs and the reasonable fees and disbursements of counsel (which
counsel may be an employee of any Bank), which may be incurred by any Bank (or
by the Agent in connection with its actions as Agent hereunder) in connection
with any investigative, administrative or judicial proceeding (whether or not
such Bank shall be designated a party thereto) relating to or arising out of
this Agreement or any actual or proposed use of proceeds of Loans hereunder;
provided that no Bank shall have the right to be indemnified hereunder for its
own gross negligence or willful misconduct as determined by a court of competent
jurisdiction.
SECTION 9.05. Sharing of Set-Offs. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of principal and
interest due with respect to any Note held by such other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right of
any Bank to exercise any right of set-off or counterclaim it may have and to
apply the amount subject to such exercise to the payment of indebtedness of the
Borrower other than its indebtedness under the Notes. The Borrower agrees, to
the fullest extent it may effectively do so under applicable law, that any
holder of a participation in a Note, whether or not acquired pursuant to the
foregoing arrangements, may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.06. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of the Agent are affected thereby, by the Agent);
provided that no such amendment, waiver or modification shall, unless signed by
all the Banks, (i) increase or decrease the Commitment of any Bank (except for a
ratable decrease in the Commitments of all Banks) or subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on any
Loan or any fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or any fees hereunder or for any
termination of any Commitment or (iv) change the percentage of the Commitments
or of the aggregate unpaid principal amount of the Notes, or the number of
Banks, which shall be required for the Banks or any of them to take any action
under this Section or any other provision of this Agreement.
SECTION 9.07. Successors and Assigns. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that the Borrower may
not assign or otherwise transfer any of its rights under this Agreement without
the prior written consent of all the Banks, which consent will be in the Banks'
sole discretion.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans; provided that contemporaneously with the grant of any
such participating interest, such Bank shall grant to such Participant an
equivalent proportionate participating interest in such Bank's "Commitment
Percentage" of the "Combined Commitment" and "Participating Interests" under and
as defined in each of the Receivables Purchase Agreements then in effect. In
the event of any such grant by a Bank of a participating interest to a
Participant, whether or not upon notice to the Borrower and the Agent, such Bank
shall remain responsible for the performance of its obligations hereunder, and
the Borrower and the Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this Agreement.
Any agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrower hereunder including, without limitation,
the right to approve any amendment, modification or waiver of any provision of
this Agreement; provided that such participation agreement may provide that such
Bank will not agree to any modification, amendment or waiver of this Agreement
described in clause (i), (ii) or (iii) of Section 9.06 without the consent of
the Participant. The Borrower agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of
Article VIII with respect to its participating interest. An assignment or other
transfer which is not permitted by subsection (c) or (d) below shall be given
effect for purposes of this Agreement only to the extent of a participating
interest granted in accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or
other institutions (each an "Assignee") all, or a proportionate part of all, of
its rights and obligations under this Agreement and the Notes, and such Assignee
shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement in substantially the form of Exhibit G hereto executed by
such Assignee and such transferor Bank, with (and subject to) the subscribed
consent of the Borrower, APL (if its Receivables Purchase Agreement is then in
effect) and APD (if its Receivables Purchase Agreement is then in effect) which
consent, in each case, will not be unreasonably withheld (with a copy of such
Assignment and Assumption Agreement delivered to the Agent and, if either of the
Receivables Purchase Agreements is then in effect, J.P. Morgan Delaware, as
Administrative Agent thereunder); provided that (i) the amount so assigned to
any Assignee that was not a Bank for purposes hereof immediately prior to such
assignment shall be not less than $5,000,000, (ii) if an Assignee is a Person
which controls, is controlled by, or is under common control with, or is
otherwise substantially affiliated with, the transferor Bank, no such consent
shall be required, (iii) such assignment may, but need not, include rights of
the transferor Bank in respect of outstanding Money Market Loans, and (iv)
contemporaneously with such assignment, such Bank shall assign to such Assignee
an equivalent proportionate part of such Bank's rights and obligations under
each of the Receivables Purchase Agreements then in effect. Upon execution and
delivery of such instrument and payment by such Assignee to such transferor Bank
of an amount equal to the purchase price agreed between such transferor Bank and
such Assignee, such Assignee shall be a Bank party to this Agreement and a
"Purchaser" under and as defined in each of the Receivables Purchase Agreements
then in effect and shall have all the rights and obligations of a Bank with a
Commitment hereunder and a "Purchaser" with a "Commitment Percentage" of the
"Combined Commitment" under and as defined in each of the Receivables Purchase
Agreements then in effect as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder and under such
Receivables Purchase Agreement to a corresponding extent, and no further consent
or action by any party shall be required. Upon the consummation of any
assignment pursuant to this subsection (c), the transferor Bank, the Agent and
the Borrower shall make appropriate arrangements so that, if required, a new
Note is issued to the Assignee. In connection with any such assignment, the
transferor Bank shall pay to the Agent an administrative fee for processing such
assignment in accordance with the Agent's standard schedule for such charges in
effect at the time of such assignment. If the Assignee is not incorporated
under the laws of the United States of America or a state thereof, it shall,
prior to the first date on which interest or fees are payable hereunder for its
account, deliver to the Borrower and the Agent certification as to exemption
from deduction or withholding of any United States federal income taxes in
accordance with Section 2.15.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Notes to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section 8.03 than
such Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by reason of the provisions of Section 8.02 or 8.03 requiring such
Bank to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist and were not reasonably foreseeable by such Bank.
(f) The Borrower may at any time with the consent of the
Required Banks remove any Reference Bank and/or appoint another bank as a
Reference Bank; provided that there shall at no time be less than two Reference
Banks acting hereunder.
SECTION 9.08. Collateral. Each of the Banks represents to the
Agent and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.09. Confidentiality. Each Bank agrees that all
documentation and other information made available by the Borrower to such Bank
under the terms of this Agreement shall (except to the extent that such
documentation and other information is publicly available or hereafter becomes
publicly available other than by action of such Bank, or was theretofore known
to such Bank independent of any disclosure thereto by the Borrower) be held in
the strictest confidence by such Bank and used solely in connection with
administration of Loans from time to time outstanding from such Bank to the
Borrower; provided that (i) such Bank may disclose such documentation and other
information to any bank or other institution to which such Bank proposes to
assign all or a portion of its Commitment and its Loans hereunder or sells or
proposes to sell a participation in its Loans hereunder, if (x) such Bank has
notified the Borrower in writing of the identity of such other bank or other
institution and the Borrower has not, by the fifth Domestic Business Day
following such notification, notified such Bank of its reasonable disapproval of
such other bank or other institution and (y) such other bank or other
institution, prior to such disclosure, agrees for the benefit of the Borrower to
comply with the provisions of this Section 9.09, (ii) such Bank may disclose the
provisions of this Agreement and the Notes and the amounts, maturities and
interest rates of its Loans to any purchaser or potential purchaser of such
Bank's interest in any Loan and (iii) such Bank may disclose documentation and
information that is permitted to be disclosed under any other agreement between
such Bank and the Borrower in accordance with such other agreement. It is
understood that any Bank may be required to disclose such documentation or other
information or portions thereof, (1) at the request of a bank regulatory agency
or in connection with an examination of such Bank by bank examiners, (2)
pursuant to subpoena or other court process, (3) at the express direction of any
other authorized government agency, (4) to the independent auditors of such Bank
or (5) as otherwise required by law.
SECTION 9.10. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
SECTION 9.11. Counterparts; Integration. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
SECTION 9.12. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the day and
year first above written.
AMERICAN PRESIDENT COMPANIES, LTD.
By /s/ Randall K. Gausman
Title: Assistant Treasurer
1111 Broadway
Oakland, California 94607
Telex number: 335478
Facsimile number: (510) 272-8931
Commitments:
$22,500,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Diana H. Imhof
Title: Associate
$20,000,000 J.P. MORGAN DELAWARE
By /s/ Philip S. Detjens
Title: Vice President
$42,500,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By /s/ Michael J. Dasher
Title: Vice President
$35,000,000 THE FIRST NATIONAL BANK OF BOSTON
By /s/ Daniel O'Connor
Title: Director
$30,000,000 BARCLAYS BANK PLC
By /s/ Keith Mackie
Title: Associate Director
$25,000,000 ABN AMRO BANK N.V.
By /s/ Carol A. Levine
Title: Vice President
By /s/ Robert N. Hartinger
Title: Group Vice President
$25,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Gerald F. Mackin
Title: Vice President
Total Commitments
$200,000,000
=================
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By /s/ Diana H. Imhof
Title: Associate
60 Wall Street
New York, New York 10260-0060
Attention: Diana H. Imhof
Telex number: 177615
Facsimile number: (212) 648-5014
SCHEDULE I
CERTAIN EXISTING LIENS
12/31/93
BALANC AGREEMENT
LESSOR (OR LIENHOLDER) ASSET ($000) DATE
CAPITAL LEASE OBLIGATIONS:
Port of Oakland Alliance Crane 1,315 02/04/77
American Fletcher Chassis 4,999 12/16/85
(BancOne)
Metlife Capital Chassis 8,150 12/16/85
Mitsubishi International Chassis 1,158 03/06/86
Wells Fargo Chassis 1,137 04/29/86
(Norwest)
U. S. West Financial Chassis 2,644 05/15/86
REAL ESTATE ASSESSMENT OBLIGATIONS:
City of Folsom Assessment Folsom Property 112 06/84
District Bonds
OTHER SECURED DEBT:
Mitsui & Co. Chassis 3,577 03/12/86
Kreditanstalt M/V Pres. Truman 14,294 04/22/88
fuer Wiederaufbau
Kreditanstalt M/V Pres. Kennedy 16,677 07/14/88
fuer Wiederaufbau
Kreditanstalt M/V Pres. Polk 16,677 07/17/88
fuer Wiederaufbau
Kreditanstalt M/V Pres. Jackson 16,677 09/08/88
fuer Wiederaufbau
Kreditanstalt M/V Pres. Adams 16,677 09/30/88
fuer Wiederaufbau
EXHIBIT A
NOTE
New York, New York
[Effective Date]
For value received, AMERICAN PRESIDENT COMPANIES, LTD., a
Delaware corporation (the "Borrower"), promises to pay to the order of
____________ (the "Bank"), for the account of its Applicable Lending Office, the
unpaid principal amount of each Loan made by the Bank to the Borrower pursuant
to the Credit Agreement referred to below on the last day of the Interest Period
relating to such Loan. The Borrower promises to pay interest on the unpaid
principal amount of each such Loan on the dates and at the rate or rates
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of Morgan Guaranty Trust Company of
New York, 60 Wall Street, New York, New York.
All Loans made by the Bank, the respective types and maturities
thereof and all repayments of the principal thereof shall be recorded by the
Bank and, prior to any transfer hereof, appropriate notations to evidence the
foregoing information with respect to each such Loan then outstanding shall be
endorsed by the Bank on the schedule attached hereto, or on a continuation of
such schedule attached to and made a part hereof; provided that the failure of
the Bank to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement
dated as of March 25, 1994 among American President Companies, Ltd., the banks
listed on the signature pages thereof and Morgan Guaranty Trust Company of New
York, as Agent (as the same may be amended from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the
same meanings. Reference is made to the Credit Agreement for provisions for the
prepayment hereof and the acceleration of the maturity hereof.
AMERICAN PRESIDENT COMPANIES, LTD.
By________________________
Title:
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
__________________________________________________________________
Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
EXHIBIT B
Form of Money Market Quote Request
[Date]
To: Morgan Guaranty Trust Company of New York
(the "Agent")
From: American President Companies, Ltd. (the "Borrower")
Re: Credit Agreement (the "Credit Agreement") dated as of March 25, 1994
among American President Companies, Ltd., the Banks listed on the signature
pages thereof and the Agent
We hereby give notice pursuant to Section 2.03 of the Credit
Agreement that we request Money Market Quotes for the following proposed Money
Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount2 Interest Period3
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Terms used herein have the meanings assigned to them in the
Credit Agreement.
2 Amount must be $5,000,000 or a larger multiple of $1,000,000.
3 Not less than one month (LIBOR Auction) or not less than 30 days (Absolute
Rate Auction), subject to the provisions of the definition of Interest Period.
AMERICAN PRESIDENT COMPANIES, LTD.
By________________________
Title:
EXHIBIT C
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes
to American President Companies, Ltd.
(the "Borrower")
Pursuant to Section 2.03 of the Credit Agreement dated as of
March 25, 1994 among American President Companies, Ltd., the Banks parties
thereto and the undersigned, as Agent (as the same may be amended from time to
time, the "Credit Agreement"), we are pleased on behalf of the Borrower to
invite you to submit Money Market Quotes to the Borrower for the following
proposed Money Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Please respond to this invitation by no later than [2:00 P.M.]
[9:00 A.M.] (New York City time) on [date].
Terms used herein have the meanings assigned to them in the
Credit Agreement.
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By______________________
Authorized Officer
EXHIBIT D
Form of Money Market Quote
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
60 Wall Street
New York, New York 10260
Attention:
Re: Money Market Quote to American President Companies, Ltd. (the
"Borrower")
In response to your invitation on behalf of the Borrower dated
_____________, 19__, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: _______________________________________
2. Person to contact at Quoting Bank: ___________________
3. Date of Borrowing: ____________________*
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
$
$
[Provided, that the aggregate principal amount of Money
Market Loans for which the above offers may be accepted shall not exceed
$____________.]**
__________
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal amount
requested. Specify aggregate limitation if the sum of the individual offers
exceeds the amount the Bank is willing to lend. Bids must be made for
$5,000,000 or a larger multiple of $1,000,000.
(notes continued on following page)
We understand and agree that the offer(s) set forth above,
subject to the satisfaction of the applicable conditions set forth in the Credit
Agreement dated as of March 25, 1994 among American President Companies, Ltd.,
the Banks listed on the signature pages thereof and yourselves, as Agent,
irrevocably obligates us to make the Money Market Loan(s) for which any offer(s)
are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated:_______________ By:__________________________
Authorized Officer
___________
*** Not less than one month or not less than 30 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period. Specify percentage (to the nearest 1/10,000 of 1%)
and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
EXHIBIT E
OPINION OF
COUNSEL FOR THE BORROWER
[Effective Date]
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
I am the Senior Counsel of American President Companies, Ltd.
(the "Borrower") and have acted as counsel for the Borrower in connection with
the Credit Agreement (the "Credit Agreement") dated as of March 25, 1994. Terms
defined in the Credit Agreement are used herein as therein defined. This
opinion is being rendered to you at the request of my client pursuant to Section
3.01(d) of the Credit Agreement.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as I have deemed necessary or advisable for
purposes of this opinion. As to various questions of fact material to my
opinion relating to financial matters, I have relied upon representations made
to me by other officers of the Borrower.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower and each of its corporate Subsidiaries is a
corporation duly incorporated, validly existing and in good standing under the
laws of its jurisdiction of incorporation, and has all corporate powers and all
material governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted, the absence of which good standing
and governmental licenses, authorizations, consents and approvals would have a
material adverse effect on the business, financial position, results of
operations or prospects of the Borrower and its Consolidated Subsidiaries,
considered as a whole.
2. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the corporate powers of the
Borrower, have been duly authorized by all necessary corporate action, require
no action by or in respect of, or filing with, any governmental body, agency or
official and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of incorporation or by-laws
of the Borrower or of any agreement, judgment, injunction, order, decree or
other instrument binding upon the Borrower or result in the creation or
imposition of any Lien on any asset of the Borrower or any Subsidiary.
3. The Credit Agreement constitutes a valid and binding
agreement of the Borrower, assuming the valid execution and delivery thereof by
the other parties thereto, and each of the Notes constitutes a valid and binding
obligation of the Borrower, in each case enforceable in accordance with its
terms except as the enforceability thereof may be limited by bankruptcy,
insolvency and similar laws affecting the creditors' rights generally and by
general principles of equity.
4. There is no action, suit or proceeding pending against, or to
the best of my knowledge after due inquiry threatened against or affecting, the
Borrower or any Subsidiary before any court or arbitrator or any governmental
body, agency or official, in which there is a significant possibility of an
adverse decision which could materially adversely affect the business, financial
position, results of operations or prospects of the Borrower and its
Consolidated Subsidiaries, considered as a whole, or which in any manner draws
into question the validity of the Credit Agreement or the Notes.
5. The Borrower and its Subsidiaries are in compliance in all
material respects with the terms of all agreements currently in effect between
the Borrower or any such Subsidiary and MarAd, and with all applicable
regulations of MarAd with respect to which noncompliance would have a material
adverse effect on the business, financial position, results of operations or
prospects of the Borrower and its Consolidated Subsidiaries taken as a whole,
including without limitation all agreements and regulations relating to
construction-differential subsidy, operating-differential subsidy, capital
construction fund or U.S. Government-guaranteed obligations under Title XI of
the Merchant Marine Act of 1936, as amended, and the execution, delivery and
performance by the Borrower of the Credit Agreement and the Notes will not cause
or result in a violation of any provision of any such agreement or regulation.
I note that the "governing law" provision in the Credit Agreement
provides that the laws of the State of New York are to govern the Credit
Agreement and the Notes. In my opinion a court applying California conflict of
laws rules would give effect to such choice of New York law; however, I express
no opinion as to what law a court applying any other State's conflict of laws
rules would apply.
For purposes of my opinion in paragraph (3) above, I have with
your consent (i) assumed that a court would apply the substantive laws of either
California or New York and (ii) assumed (without examining the laws of New York)
that the substantive laws of New York governing the interpretation and
enforcement of each provision of the Credit Agreement and the Notes do not
differ in any material respect from the substantive laws of California.
For purposes of my opinion in paragraph (5) above with respect to
the agreements between the Borrower or any Subsidiary of the Borrower and MarAd,
I have with your consent relied on the opinion of General Counsel of APL, dated
the date hereof, a copy of which has been delivered to each of you.
I am a member of the Bar of the State of California and the
foregoing opinion is limited to the laws of the State of California, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person without my written consent.
Very truly yours,
EXHIBIT F
OPINION OF
DAVIS POLK & WARDWELL, SPECIAL COUNSEL
FOR THE AGENT
[Effective Date]
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
We have participated in the preparation of the Credit Agreement
(the "Credit Agreement") dated as of March 25, 1994, among American President
Companies, Ltd., a Delaware corporation (the "Borrower"), the banks listed on
the signature pages thereof (the "Banks") and Morgan Guaranty Trust Company of
New York, as Agent (the "Agent"), and have acted as special counsel for the
Agent for the purpose of rendering this opinion pursuant to Section 3.01(e) of
the Credit Agreement. Terms defined in the Credit Agreement are used herein as
therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the corporate powers of the
Borrower and have been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding
agreement of the Borrower and the Notes constitute valid and binding obligations
of the Borrower.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware. In giving the foregoing opinion, we express no opinion as to
the effect (if any) of any law of any jurisdiction (except the State of New
York) in which any Bank is located which limits the rate of interest that such
Bank may charge or collect.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person without our written consent.
Very truly yours,
EXHIBIT G
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the
"Assignor"), [ASSIGNEE] (the "Assignee"), AMERICAN PRESIDENT COMPANIES, LTD.
("the Borrower", the "Borrower") [, AMERICAN PRESIDENT LINES, LTD. ("APL") and
APL LAND TRANSPORT SERVICES, INC. ("APD")].4
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to [(i)] the Credit Agreement dated as of March 25, 1994
among the Borrower, the Assignor and the other Banks party thereto, as Banks,
and Morgan Guaranty Trust Company of New York ("MGT"), as Agent (as the same may
be amended from time to time, the "Credit Agreement") [(ii) the Receivables
Purchase Agreement dated as of August 29, 1991 among APL, the Assignor and the
other banks party thereto, as Purchasers, J.P. Morgan Delaware ("JPMD"), as
Administrative Agent, and MGT, as Co-Agent (as the same may be amended from time
to time, the "APL Receivables Purchase Agreement") and (iii) the Receivables
Purchase Agreement dated as of August 29, 1991 among APD, the Assignor and the
other banks party thereto, as Purchasers, JPMD, as Administrative Agent, and
MGT, as Co-Agent (as the same may be amended from time to time, the "APD
Receivables Purchase Agreement", and, together with the APL Receivables Purchase
Agreement, the "Receivables Purchase Agreements")];
WHEREAS, as provided under the Credit Agreement, the Assignor has
a Commitment to make Loans to the Borrower in an aggregate principal amount at
any time outstanding not to exceed $__________;
WHEREAS, Committed Loans made by the Assignor under the Credit
Agreement in the aggregate principal amount of $__________ are outstanding at
the date hereof;
4Include APL and or APD and references to APL and or APD and J.P. Morgan
Delaware and Receivables Purchase Agreements if the Receivables Purchase
Agreements are then in effect. Modify accordingly if only the APL Receivables
Purchase Agreement is then in effect.
[WHEREAS, the Assignor has a commitment (the "Receivables
Committed Amount") under each of the Receivables Purchase Agreements to purchase
undivided interests in certain accounts receivable owned by APL and APD for an
aggregate purchase price not to exceed $___________ at any time;] and
WHEREAS, the Assignor proposes to assign to the Assignee all of
the rights of the Assignor under the Credit Agreement in respect of a portion of
its Commitment thereunder in an amount equal to $___________ (the "Assigned
Amount"), together with a corresponding portion of each of its outstanding
Committed Loans, [and all of the rights of the Assignor under each of the
Receivables Purchase Agreements in respect of a portion of its Receivables
Committed Amount in an amount equal to $___________ (the "Receivables Assigned
Amount"),] and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the Credit
Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to
the Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount [and under the Receivables Purchase Agreements to
the extent of the Receivables Assigned Amount], and the Assignee hereby accepts
such assignment from the Assignor and assumes all of the obligations of the
Assignor under the Credit Agreement to the extent of the Assigned Amount [and
under the Receivables Purchase Agreements to the extent of the Receivables
Assigned Amount], including the purchase from the Assignor of the corresponding
portion of the principal amount of each of the Committed Loans made by the
Assignor outstanding at the date hereof. Upon the execution and delivery hereof
by the Assignor, the Assignee, the Borrower, [APL and APD] (with a copy hereof
delivered to MGT, as Agent [, and JPMD, as Administrative Agent]) and the
payment of the amounts specified in Section 3 required to be paid on the date
hereof (i) the Assignee shall, as of the date hereof, succeed to the rights and
be obligated to perform the obligations of [(x)] a Bank under the Credit
Agreement with a Commitment in an amount equal to the Assigned Amount [and (y) a
"Purchaser" under each of the Receivables Purchase Agreements with a Receivables
Committed Amount in an amount equal to the Receivables Assigned Amount,] and
(ii) as of the date hereof, the Commitment of the Assignor shall be reduced by
the Assigned Amount [and the Receivables Committed Amount of the Assignor shall
be reduced by the Receivables Assigned Amount], and the Assignor shall be
released from its obligations under the Credit Agreement [and under the
Receivables Purchase Agreements] to the extent such obligations have been
assumed by the Assignee. The assignment provided for herein shall be without
recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and
sale contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on
the date hereof in Federal funds an amount equal to $_________.5 It is
understood that commitment and/or facility fees accrued with respect to the
Assigned Amount to the date hereof are for the account of the Assignor and such
fees accruing from and including the date hereof are for the account of the
Assignee. Each of the Assignor and the Assignee hereby agrees that, if it
receives any amount under the Credit Agreement [or any of the Receivables
Purchase Agreements] which is for the account of the other party hereto, it
shall receive the same for the account of such other party to the extent of such
other party's interest therein and shall promptly pay the same to such other
party.
SECTION 4. Consent of the Borrower [, APL and APD]. This
Agreement is conditioned upon the consent of the Borrower [, APL and APD]
pursuant to Section 9.07(c) of the Credit Agreement [and Section 10.08(c) of
each of the Receivables Purchase Agreements]. The execution of this Agreement
by the Borrower [, APL and APD] is evidence of this consent. Pursuant to
Section 9.07(c) of the Credit Agreement the Borrower agrees to execute and
deliver a Note payable to the order of the Assignee to evidence the assignment
and assumption under the Credit Agreement provided for herein, and the Assignor
agrees to make appropriate notations on its Note to reflect the assignment
hereunder6.
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of the
Borrower [, APL or APD], or the validity and enforceability of the obligations
of the Borrower in respect of the Credit Agreement or any Note [or the validity
and enforceability of the obligations of APL or APD, as the case may be, in
respect of the Receivables Purchase Agreement to which it is a party or any
"Assignment" relating thereto]. The Assignee acknowledges that it has,
independently and without reliance on the Assignor, and based on such documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and will continue to be responsible for
making its own independent appraisal of the business, affairs and financial
condition of the Borrower[, APL and APD].
5Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee. It may be preferable in an
appropriate case to specify these amounts generically or by formula rather than
as a fixed sum.
6If the Borrower's consert is not required pursuant to Section 9.07(c) of the
Credit Agreement, Section 4 of this Agreement should be deleted and this
Agreement does not need to be signed by the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
[ASSIGNOR]
By_________________________
Title:
[ASSIGNEE]
By__________________________
Title:
AMERICAN PRESIDENT COMPANIES,
LTD.
By__________________________
Title:
[AMERICAN PRESIDENT LINES,
LTD.
By__________________________
Title:]
[APL LAND TRANSPORT
SERVICES, INC.
By__________________________]
Title:]