Exhibit 10.14
Credit Agreement between Provident and a consortium
of Financial Institutions
(attached)
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PROVIDENT COMPANIES, INC.
_____________________________
CREDIT AGREEMENT
Dated as of July 30, 1996
______________________________
$800,000,000
______________________________
THE CHASE MANHATTAN BANK,
as Administrative Agent
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TABLE OF CONTENTS
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Section 1. Definitions and Accounting Matters 1
1.01 Certain Defined Terms 1
1.02 Accounting Terms and Determinations 18
1.03 Types of Loans 19
1.04 Moody's Ratings and S&P Ratings 19
1.05 Moody's Claims Ratings and S&P Claims Ratings 19
Section 2. Commitments, Loans, Notes and Prepayments 20
2.01 Loans 20
2.02 Borrowings 20
2.03 Changes of Commitments 20
2.04 Facility Fee 21
2.05 Lending Offices 23
2.06 Several Obligations; Remedies Independent 23
2.07 Notes 23
2.08 Optional Prepayments and Conversions or
Continuations of Loans 24
2.09 Mandatory Prepayments and Reductions of
Commitments 24
Section 3. Payments of Principal and Interest 25
3.01 Repayment of Loans 25
3.02 Interest 25
Section 4. Payments; Pro Rata Treatment; Computations; Etc. 26
4.01 Payments 26
4.02 Pro Rata Treatment 27
4.03 Computations 27
4.04 Minimum Amounts 28
4.05 Certain Notices 28
4.06 Non-Receipt of Funds by the Administrative Agent 29
4.07 Sharing of Payments, Etc. 30
Section 5. Yield Protection, Etc. 31
5.01 Additional Costs 31
5.02 Limitation on Types of Loans 34
5.03 Illegality 35
5.04 Treatment of Affected Loans 35
5.05 Compensation 36
5.06 U.S. Taxes 37
5.07 Replacement of Bank 38
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Section 6. Conditions Precedent 39
6.01 Initial Loan 39
6.02 Acquisition/Post-Acquisition Loans 41
6.03 Initial and Subsequent Loans 43
Section 7. Representations and Warranties 43
7.01 Corporate Existence 43
7.02 Financial Condition 44
7.03 Litigation 45
7.04 No Breach 45
7.05 Action 45
7.06 Approvals 46
7.07 Use of Credit 46
7.08 ERISA 46
7.09 Taxes 46
7.10 Investment Company Act 47
7.11 Public Utility Holding Company Act 47
7.12 Credit Agreements 47
7.13 Hazardous Materials 47
7.14 Subsidiaries, Etc. 47
7.15 True and Complete Disclosure 48
7.16 Capitalization 48
7.17 Purchase Agreement 48
Section 8. Covenants of the Company 49
8.01 Financial Statements 49
8.02 Litigation 53
8.03 Existence, Etc. 54
8.04 Insurance 54
8.05 Limitation of Fundamental Changes 55
8.06 Certain Obligations Respecting Subsidiaries 56
8.07 Limitation on Liens 56
8.08 Investments 59
8.09 Dividend Payments 59
8.10 Minimum Adjusted Statutory Surplus 60
8.11 Consolidated Funded Debt 60
8.12 Ratio of Cash Sources to Cash Uses 60
8.13 Authorized Control Level Risk
Based Capital Ratio 60
8.14 Lines of Business 60
8.15 Transactions with Affiliates 60
8.16 Use of Proceeds 61
8.17 Pari Passu 61
Section 9. Events of Default 62
Section 10. The Administrative Agent 65
10.01 Appointment, Powers and Immunities 65
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10.02 Reliance by Administrative Agent 66
10.03 Defaults 66
10.04 Rights as a Bank 67
10.05 Indemnification 67
10.06 Non-Reliance on Administrative
Agent and Other Banks 68
10.07 Failure to Act 68
10.08 Resignation or Removal of Administrative Agent 68
10.09 Agency Fee 69
10.10 Consents under Basic Documents 69
Section 11. Miscellaneous 69
11.01 Waiver 69
11.02 Notices 69
11.03 Expenses, Etc. 70
11.04 Amendments, Etc. 71
11.05 Successors and Assigns 72
11.06 Assignments and Participations 72
11.07 Survival 74
11.08 Captions 74
11.09 Counterparts 74
11.10 Governing Law; Submission to Jurisdiction 75
11.11 Waiver of Jury Trial 75
11.12 Treatment of Certain Information
Confidentiality 75
SCHEDULE I - Credit Agreements
SCHEDULE II - Subsidiaries
SCHEDULE III- Investment Companies
EXHIBIT A - Form of Note
EXHIBIT B - Form of Opinion of Counsel to the Company
EXHIBIT C - Form of Opinion of Special New York Counsel to the Banks
EXHIBIT D - Form of Confidentiality Agreement
CREDIT AGREEMENT dated as of July 30, 1996, between: PROVIDENT
COMPANIES, INC., a corporation duly organized and validly existing under the
laws of the State of Delaware (the "Company"); each of the lenders that is a
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signatory hereto identified under the caption "BANKS" on the signature pages
hereto or that, pursuant to Section 11.06(b) hereof, shall become a "Bank"
hereunder (individually, a "Bank" and, collectively, the "Banks"); and THE CHASE
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MANHATTAN BANK, a New York banking corporation, as agent for the Banks (in such
capacity, together with its successors in such capacity, the "Administrative
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Agent").
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The Company is engaged in the business of insurance, and in related
businesses, and in furnishing the required supplies, services, equipment, credit
and other facilities for such operation. The Company has requested the Banks to
make loans to the Company in an aggregate principal amount at any time
outstanding not exceeding $800,000,000 to finance the operations of the Company,
to enable certain acquisitions by the Company, and for other purposes.
To induce the Banks to make such loans, the Company, the Banks and the
Administrative Agent propose to enter into this Agreement pursuant to which the
Banks will make loans to the Company.
Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
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1.01 Certain Defined Terms . As used herein, the following terms
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shall have the following meanings (all terms defined in this Section 1.01 or in
other provisions of this Agreement in the singular to have the same meanings
when used in the plural and vice versa):
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"Acquisition" shall mean the acquisition by the Company of Paul Revere
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as provided in the Purchase Agreement.
"Acquisition Date" shall mean the date the Acquisition is effective.
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"Adjusted Statutory Surplus" shall mean, at any time, for any
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Insurance Subsidiary calculated in accordance with SAP, the sum of (x) the
amount by which assets exceed liabilities at such time (which amount for PLAIC
as at December 31, 1995, by way of example, is shown on the 1995 Annual
Statement, Statement of Liabilities, Surplus and Other Funds, page 3, column 1,
line 38, of PLAIC) plus (y) the consolidated asset valuation reserves of such
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Insurance Subsidiary as at such time (which amount for PLAIC as at December 31,
1995, by way of example, is shown on the 1995 Annual Statement, Statement of
Liabilities, Surplus and Other Funds, page 3, column 1, line 24.1).
"Affiliate" shall mean any Person that directly or indirectly
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controls, or is under common control with, or is controlled by, the Company. As
used in this definition, "control" (including, with its correlative meanings,
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"controlled by" and "under common control with") shall mean possession, directly
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or indirectly, of power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise), provided that, in any event, any
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Person that owns directly or indirectly securities having 25% or more of the
voting power for the election of directors or other governing body of a
corporation or 10% or more of the partnership or other ownership interests of
any other Person (other than as a limited partner of such other Person) will be
deemed to control such corporation or other Person. Notwithstanding the
foregoing, (a) no individual shall be an Affiliate solely by reason of his or
her being a director, officer or employee of the Company or any of its
Subsidiaries and (b) none of the Subsidiaries of the Company shall be
Affiliates.
"Applicable Insurance Regulatory Authority" shall mean, for each
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Insurance Subsidiary, the insurance department or similar administrative
authority or agency located in the State in which such Insurance Subsidiary is
domiciled (or otherwise having jurisdiction thereover).
"Applicable Lending Office" shall mean, for each Bank and for each
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Type of Loan, the "Lending Office" of such Bank (or of an affiliate of such
Bank) designated for such Type of Loan on the signature pages hereof or such
other office of such Bank (or of an affiliate of such Bank) as such Bank may
from time to time specify to the Administrative Agent and the Company as the
office by which its Loans of such Type are to be made and maintained.
"Applicable Margin" shall mean, subject to the following sentence:
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(a) with respect to Base Rate Loans, 0% per annum; and (b) with respect to
Eurodollar Loans, as at any date of determination, the sum of (x) the
Utilization Premium, if any, and (y) the percentage per annum (expressed in
number of basis points) determined by reference to the Moody's Rating and the
S&P Rating as at such date:
Category Moody's Rating S&P Rating Applicable Margin
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(a) A3 or higher A- or higher 20 basis points
(b) Less than A3 Less than A- but 22.5 basis points
but equal to equal to or greater
or greater than BBB+
than Baa1
(c) Less than Baa1 Less than BBB+ 30 basis points
but equal to but equal to or
or greater greater than BBB
than Baa2
(d) Less than Baa2 Less than BBB 35 basis points
but equal to but equal to or
or greater greater than BBB-
than Baa3
(e) Less than Baa3 Less than BBB- 50 basis points
provided, however, that in order to qualify for a particular category of
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Applicable Margin (other than in the case of clause (e) above) both the Moody's
Rating and the S&P Rating required for that category of Applicable Margin must
be attained and, accordingly, if one rating is lower than the other, the
Applicable Margin shall be determined on the basis of the lower of the two
ratings. Each change in any Applicable Margin in respect of Eurodollar Loans
resulting from a change in the Moody's Rating or the S&P Rating shall take
effect at the time of the public announcement of such change in the Moody's
Rating or the S&P Rating, as the case may be. If either a Moody's Rating or an
S&P Rating shall not be available, the "Applicable Margin" with respect to
Eurodollar Loans, as at any date of determination, shall be the sum of (x) the
Utilization Premium, if any, and (y) the percentage per annum (expressed in
number of basis points) determined by reference to the Moody's Claims Rating and
the S&P Claims Rating as at such date:
Category Moody's Claims S&P Claims Rating Applicable Margin
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Rating
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(a) Aa3 or higher AA- or higher 20 basis points
(b) Less than Aa3 Less than AA- but 22.5 basis points
but equal to equal to or greater
or greater than A+
than A1
(c) Less than A1 Less than A+ 30 basis points
but equal to but equal to or
or greater greater than A
than A2
(d) Less than A2 Less than A 35 basis points
but equal to but equal to or
or greater greater than A-
than A3
(e) Less than A3 Less than A- 50 basis points
provided, however, that in order to qualify for a particular category of
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Applicable Margin (other than in the case of clause (e) above) both the Moody's
Claims Rating and the S&P Claims Rating required for that category of Applicable
Margin must be attained and, accordingly, if one rating is lower than the other,
the Applicable Margin shall be determined on the basis of the lower of the two
ratings. Each change in any Applicable Margin in respect of Eurodollar Loans
resulting from a change in the Moody's Claims Rating or the S&P Claims Rating
shall take effect at the time of the public announcement of such change in the
Moody's Claims Rating or the S&P Claims Rating, as the case may be.
"Bankruptcy Code" shall mean the Federal Bankruptcy Code of 1978, as
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amended from time to time.
"Base Rate" shall mean, for any day, a rate per annum equal to the
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higher of (a) the Federal Funds Rate for such day plus 1/2 of 1% and (b) the
Prime Rate for such day. Each change in any interest rate provided for herein
based upon the Base Rate resulting from a change in the Base Rate shall take
effect at the time of such change in the Base Rate.
"Base Rate Loans" shall mean Loans that bear interest at rates based
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upon the Base Rate.
"Basel Accord" shall mean the proposals for risk-based capital
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framework described by the Basel Committee on Banking Regulations and
Supervisory Practices in its paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988, as amended, modified
and supplemented and in effect from time to time or any replacement thereof.
"Basic Documents" shall mean, collectively, this Agreement and the
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Notes.
"Business Day" shall mean (a) any day on which commercial banks are
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not authorized or required to close in New York City and (b) if such day relates
to a borrowing of, a payment or prepayment of principal of or interest on, a
Conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice
by the Company with respect to any such borrowing, payment, prepayment,
Conversion or Interest Period, any day on which dealings in Dollar deposits are
carried out in the London interbank market.
"Capital Lease Obligations" shall mean, for any Person, all
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obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards Board), and,
for purposes of this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP (including such
Statement No. 13).
"Cash Sources" shall mean, as at the last day of any fiscal quarter of
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the Company commencing with the fiscal quarter ending December 31, 1996, the
statutory net income of the Insurance Subsidiaries on a combined basis
determined in accordance with SAP for the one year period (or, prior to
September 30, 1997, such number of fiscal quarterly periods since October 1,
1996 as shall have elapsed) ending on such date.
"Cash Uses" shall mean, as at the last day of any fiscal quarter of
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the Company commencing with the fiscal quarter ending December 31, 1996, the
aggregate amount paid, expended, disbursed and/or distributed by the Company in
respect of principal (other than the repayment of principal of the Refinanced
Debt made pursuant to Section 6.01(f) hereof), Interest Expense payable in
connection with Indebtedness and Dividend Payments for the one year period (or,
prior to September 30, 1997, such number of fiscal quarterly periods since
October 1, 1996 as shall have elapsed) ending on such date.
"Chase" shall mean The Chase Manhattan Bank.
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"Closing Date" shall mean the date upon which the initial Loan
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hereunder is made.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
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time to time.
"Commitment" shall mean, for each Bank, the obligation of such Bank to
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make Loans in an aggregate amount at any one time outstanding up to but not
exceeding the amount set opposite the name of such Bank on the signature pages
hereof under the caption "Commitment" (as the same may be reduced from time to
time pursuant to Section 2.03 hereof), subject, in the case of any assignment
contemplated by Section 11.06(b) hereof, to the provisions of such Section
11.06(b).
"Commitment Termination Date" shall mean July 30, 2001.
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"Consolidated Capital" shall mean, at any time and as to the Company,
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the aggregate of the capital stock, capital surplus, paid-in capital, retained
earnings and unrealized gains (or losses) on equity securities (net of deferred
taxes) of the Company and its Consolidated Subsidiaries on a consolidated basis
(calculated without giving effect to SFAS 115), less the sum of treasury stock
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and capital stock subscribed and unissued and the book value of good will,
formula, patents, trademarks, service marks, trade names, copyrights, charters,
franchises, certificates, permits and licenses, prepaid expenses, prepaid taxes,
organizational expenses, unamortized debt discount and any other intangible
assets of the Company other than (x) unamortized deferred policy acquisition
costs and (y) value of business acquired plus the Consolidated Funded Debt.
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"Consolidated Funded Debt" shall mean Funded Debt of the Company and
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its Consolidated Subsidiaries on a consolidated basis.
"Consolidated Subsidiary" shall mean, for any Person, each Subsidiary
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of such Person (whether now existing or hereafter created or acquired) the
financial statements of which shall be (or should have been) consolidated with
the financial statements of such Person in accordance with GAAP.
"Continue", "Continuation" and "Continued" shall refer to the
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continuation pursuant to Section 2.08 hereof of a Eurodollar Loan as a
Eurodollar Loan from one Interest Period to the next Interest Period for such
Loan.
"Convert", "Conversion" and "Converted" shall refer to a conversion
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pursuant to Section 2.08 hereof of one Type of Loans into another Type of Loans,
which may be accompanied by the transfer by a Bank (at its sole discretion) of a
Loan from one Applicable Lending Office to another.
"Corporate Acquisition" shall have the meaning assigned to such term
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in Section 8.05 hereof.
"Debt Issuance" shall mean any issuance or sale by the Company or any
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of its Subsidiaries after the Closing Date of any Indebtedness of the type
described in clause (a) of the definition thereof.
"Default" shall mean an Event of Default or an event that with notice
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or lapse of time or both would become an Event of Default.
"Derivatives Obligations" of any Person shall mean all obligations of
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such Person in respect of any rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity swap or equity index swap,
equity option or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
"Dividend Payment" shall mean dividends (in cash, Property or
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obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any shares of any
class of stock of the Company or of any warrants, options or other rights to
acquire the same (or to make any payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference to the fair
market or equity value of the Company or any of its Subsidiaries), but excluding
dividends payable solely in shares of common stock of the Company.
"Dollars" and "$" shall mean lawful money of the United States of
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America.
"Environmental Laws" shall mean any and all present and future
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Federal, state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the regulation
or protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the indoor or outdoor
environment, including, without limitation, ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.
"Equity Issuance" shall mean, except for the issuance of the Company's
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common stock in connection with the Acquisition and the Zurich Investment, (a)
any issuance or sale by the Company or any of its Subsidiaries after the Closing
Date of (i) any capital stock (other than any capital stock issued to directors,
officers or employees of the Company or any of its Subsidiaries), (ii) any
Equity Rights (other than any warrants or options issued to directors, officers
or employees of the Company or any of its Subsidiaries and any capital stock of
the Company issued upon the exercise of such warrants) or (iii) any other
security or instrument representing an equity interest (or the right to obtain
any equity interest) in the issuing or selling Person or (b) the receipt by the
Company or any of its Subsidiaries after the Closing Date of any capital
contribution received (whether or not evidenced by any equity security issued by
the recipient of such contribution); provided that Equity Issuance shall not
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include (I)(x) any such issuance or sale by any Subsidiary of the Company to the
Company or any Wholly Owned Subsidiary of the Company or (y) any capital
contribution by the Company or any Wholly Owned Subsidiary of the Company to any
Subsidiary of the Company and (II) any such issuance or sale the proceeds of
which are invested by the Company in the Company's and its Subsidiaries'
business and no special Dividend Payment is declared or made with (or related
to) the proceeds thereof.
"Equity Rights" shall mean, with respect to any Person, any
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outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including, without limitation, any stockholders' or
voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock
of any class, or partnership or other ownership interests of any type in, such
Person.
"ERISA" shall mean the Employee Retirement Income Security Act of
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1974, as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business that
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is a member of any group of organizations (i) described in Section 414(b) or (c)
of the Code of which the Company is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which the Company
is a member.
"Eurodollar Base Rate" shall mean, for any Interest Period for any
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Eurodollar Loan, the arithmetic mean (rounded upwards, if necessary, to the
nearest 1/16 of 1%), as determined by the Administrative Agent, of the
respective rates per annum quoted by the respective Reference Banks at
approximately 11:00 a.m. London time (or as soon thereafter as practicable) on
the date two Business Days prior to the first day of such Interest Period for
the offering by the respective Reference Banks to leading banks in the London
interbank market of Dollar deposits having a term comparable to such Interest
Period and in an amount comparable to the Eurodollar Loans to be made by the
respective Reference Banks. If any Reference Bank is not participating in any
Eurodollar Loan during any Interest Period therefor, the Eurodollar Base Rate
for such Interest Period shall be determined by reference to the amount of the
Loan that such Reference Bank would have made or had outstanding had it been
participating in such Loan during such Interest Period. If any Reference Bank
does not timely furnish such information for determination of any Eurodollar
Base Rate, the Administrative Agent shall determine such Eurodollar Base Rate on
the basis of the information timely furnished by the remaining Reference Banks.
"Eurodollar Loans" shall mean Loans the interest rates on which are
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determined on the basis of rates referred to in the definition of "Eurodollar
Base Rate" in this Section 1.01.
"Eurodollar Rate" shall mean, for any Interest Period for any
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Eurodollar Loan, a rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) determined by the Administrative Agent to be equal to the
Eurodollar Base Rate for such Interest Period divided by 1 minus the Reserve
Requirement for such Interest Period.
"Event of Default" shall have the meaning assigned to such term in
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Section 9 hereof.
"Federal Funds Rate" shall mean, for any day, the rate per annum
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(rounded upwards, if necessary, to the nearest 1/100 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 Business Day
next succeeding such day, provided that (a) if the day for which such rate is to
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be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate charged to Chase on such Business Day on such
transactions as determined by the Administrative Agent.
"Funded Debt" shall mean, for any Person, all indebtedness created,
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issued or incurred by such Person for borrowed money (whether by loan or the
issuance and sale of debt securities or the sale of Property to another Person
subject to an understanding or agreement, contingent or otherwise, to repurchase
such Property from such Person), or any Guarantee issued by such Person in
respect of any of the foregoing, but excluding any Indebtedness attributable to
and resulting from a transaction described in Section 8.07(a)(vii) hereof.
"GAAP" shall mean generally accepted accounting principles applied on
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a basis consistent with those that, in accordance with the last sentence of
Section 1.02(a) hereof, are to be used in making the calculations for purposes
of determining compliance with this Agreement.
"Guarantee" shall mean a guarantee, an endorsement, a contingent
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agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall
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have a correlative meaning.
"Indebtedness" shall mean, for any Person: (a) obligations created,
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issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of Property to another Person
subject to an understanding or agreement, contingent or otherwise, to repurchase
such Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than trade
accounts payable (other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business so long as such trade accounts
payable are payable within 90 days of the date the respective goods are
delivered or the respective services are rendered; (c) Indebtedness of others
secured by a Lien on the Property of such Person, whether or not the respective
indebtedness so secured has been assumed by such Person; (d) obligations of such
Person in respect of letters of credit or similar instruments issued or accepted
by banks and other financial institutions for account of such Person; (e)
Capital Lease Obligations of such Person; and (f) Indebtedness of others
Guaranteed by such Person.
"Insurance Subsidiary" shall mean any Subsidiary regulated by an
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insurance department or similar administrative authority or agency.
"Interest Expense" shall mean, for any period, the sum, for the
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Company and its Consolidated Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), of the following: (a) all
interest in respect of Indebtedness accrued or capitalized during such period
(whether or not actually paid during such period) plus (b) the net amounts
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payable (or minus the net amounts receivable) under Derivatives Obligations
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related to Indebtedness accrued during such period (whether or not actually paid
or received during such period).
"Interest Period" shall mean, for any Eurodollar Loan, each period
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commencing on the date such Eurodollar Loan is made or Converted from a Loan of
another Type or the last day of the next preceding Interest Period for such Loan
and ending on the numerically corresponding day in the first, third or sixth
calendar month thereafter, as the Company may select as provided in Section 4.05
hereof, except that each Interest Period for a Eurodollar Loan that commences on
the last Business Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period would otherwise end
after the Commitment Termination Date, such Interest Period shall end on the
Commitment Termination Date; (ii) each Interest Period that would otherwise end
on a day which is not a Business Day shall end on the next succeeding Business
Day (or, in the case of an Interest Period for a Eurodollar Loan, if such next
succeeding Business Day falls in the next succeeding calendar month, on the next
preceding Business Day); and (iii) notwithstanding clause (i) above, no Interest
Period shall have a duration of less than one month and, if the Interest Period
for any Eurodollar Loan would otherwise be a shorter period, such Loan shall not
be available hereunder for such period.
"Investment" shall mean, for any Person: (a) the acquisition (whether
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for cash, Property, services or securities or otherwise) of capital stock,
bonds, notes, debentures, partnership or other ownership interests or other
securities of any other Person or any agreement to make any such acquisition
(including, without limitation, any "short sale" or any sale of any securities
at a time when such securities are not owned by the Person entering into such
short sale); (b) the making of any deposit with, or advance, loan or other
extension of credit to, any other Person (including the purchase of Property
from another Person subject to an understanding or agreement, contingent or
otherwise, to resell such Property to such Person, but excluding any such
advance, loan or extension of credit having a term not exceeding 90 days
representing the purchase price of inventory or supplies sold by such Person in
the ordinary course of business); or (c) the entering into of any Guarantee of,
or other contingent obligation with respect to, Indebtedness or other liability
of any other Person and (without duplication) any amount committed to be
advanced, lent or extended to such Person.
"Lien" shall mean, with respect to any Property, any mortgage, lien,
----
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Agreement and the other Basic Documents, a
Person shall be deemed to own subject to a Lien any Property that 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
(other than an operating lease) relating to such Property.
"Loans" shall mean the loans provided for by Section 2.01 hereof,
-----
which may be Base Rate Loans and/or Eurodollar Loans.
"Majority Banks" shall mean, subject to the last paragraph of Section
--------------
11.04 hereof, Banks having more than 50% of the aggregate amount of the
Commitments or, if the Commitments shall have terminated, Banks holding more
than 50% of the aggregate unpaid principal amount of the Loans.
"Margin Stock" shall mean "margin stock" within the meaning of
------------
Regulations G, T, U and X.
"Material Adverse Effect" shall mean a material adverse effect on (a)
-----------------------
the Property, business, operations, financial condition, liabilities or
capitalization of the Company and its Subsidiaries taken as a whole (which, in
the case of Section 7.03 hereof, shall mean an effect thereon equal to or
exceeding (individually or in the aggregate) $50,000,000 and, in the case of the
third sentence of Section 8.05 hereof, shall be in respect of at least 10% of
the Company's assets in the aggregate), (b) the ability of the Company to
perform its obligations under any of the Basic Documents, (c) the validity or
enforceability of any of the Basic Documents, (d) the rights and remedies of the
Banks and the Administrative Agent under any of the Basic Documents or (e) the
timely payment of the principal of or interest on the Loans or other amounts
payable in connection therewith.
"Moody's Claims Rating" shall mean, as at any date of determination,
---------------------
the rating assigned by Moody's Investors Service, Inc. to PLAIC's claims paying
ability as at such date.
"Moody's Rating" shall mean, as at any date of determination, the
--------------
rating assigned by Moody's Investors Service, Inc. to the Company's senior
unsecured long term debt rating (unsupported by any credit enhancement) as at
such date.
"Multiemployer Plan" shall mean a multiemployer plan defined as such
------------------
in Section 3(37) of ERISA to which contributions have been made by the Company
or any ERISA Affiliate and that is covered by Title IV of ERISA.
"NAIC" shall mean the National Association of Insurance Commissioners
----
or any successor thereto.
"NAIC Ratings" shall mean the quality ratings assigned by the
------------
Securities Valuation Office of the NAIC to investments of the Company and its
Consolidated Subsidiaries. References in this Agreement to particular NAIC
Ratings are references to such ratings as currently defined and classified by
the Securities Valuation Office of the NAIC and if such rating system is changed
then each reference to a particular rating in this Agreement shall be deemed to
be a reference to the rating under such changed rating system which most closely
approximates the credit quality of the particular rating as defined on the date
of this Agreement.
"Net Available Proceeds" shall mean, in the case of any Equity
----------------------
Issuance or Debt Issuance, the aggregate amount of all cash and cash equivalents
received by the Company and its Subsidiaries in respect of such Equity Issuance
or Debt Issuance net of reasonable expenses (including underwriting commissions
and discounts) incurred by the Company and its Subsidiaries in connection
therewith.
"Notes" shall mean the promissory notes provided for by Section
-----
2.07(a) hereof and all promissory notes delivered in substitution or exchange
therefor, in each case as the same shall be modified and supplemented and in
effect from time to time.
"Paul Revere" means The Paul Revere Corporation, a Massachusetts
-----------
corporation.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
----
entity succeeding to any or all of its functions under ERISA.
"Person" shall mean any individual, corporation, company, voluntary
------
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or government (or any agency, instrumentality or
political subdivision thereof).
"PLAIC" shall mean Provident Life and Accident Insurance Company, a
-----
Tennessee insurance corporation, and its successors.
"Plan" shall mean an employee benefit or other plan established or
----
maintained by the Company or any ERISA Affiliate and that is covered by Title IV
of ERISA, other than a Multiemployer Plan.
"Post-Default Rate" shall mean, in respect of any principal of any
-----------------
Loan or any other amount under this Agreement, any Note or any other Basic
Document that is not paid when due (whether at stated maturity, by acceleration,
by optional or mandatory prepayment or otherwise), a rate per annum during the
period from and including the due date to but excluding the date on which such
amount is paid in full equal to 2% plus the Base Rate as in effect from time to
----
time plus the Applicable Margin for Base Rate Loans (provided that, if the
---- --------
amount so in default is principal of a Eurodollar Loan and the due date thereof
is a day other than the last day of the Interest Period therefor, the "Post-
Default Rate" for such principal shall be, for the period from and including
such due date to but excluding the last day of the Interest Period, a rate per
annum equal to 2% plus the interest rate for such Loan as provided in Section
----
3.02(b) hereof and, thereafter, the rate provided for above in this definition).
"Prime Rate" shall mean the rate of interest from time to time
----------
announced by Chase at the Principal Office as its prime commercial lending rate.
"Principal Office" shall mean the principal office of Chase, located
----------------
on the date hereof at 1 Chase Manhattan Plaza, New York, New York 10081.
"Property" shall mean any right or interest in or to property of any
--------
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Purchase Agreement" means the Agreement and Plan of Merger dated as
------------------
of April 29, 1996 among the Company, Patriot Acquisition Corporation and Paul
Revere, as amended from time to time.
"Quarterly Dates" shall mean the last day of each March, June,
---------------
September and December in each year, the first of which shall be the first such
day after the date hereof; provided that if any such day is not a Business Day,
--------
then such Quarterly Date shall be the next preceding Business Day.
"Reference Banks" shall mean Chase, First Chicago NBD Corp. and
---------------
Wachovia Bank (or their respective Applicable Lending Offices, as the case may
be).
"Refinanced Debt" shall mean the Indebtedness outstanding under the
---------------
Credit Agreement dated as of December 1, 1994 among the Company, the lenders
party thereto, and Chase, as agent, as in effect on the date hereof.
"Regulations A, D, G, T, U and X" shall mean, respectively,
-------------------------------
Regulations A, D, G, T, U and X of the Board of Governors of the Federal Reserve
System (or any successor), as the same may be modified and supplemented and in
effect from time to time.
"Regulatory Change" shall mean, with respect to any Bank, any change
-----------------
after the date hereof in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Bank of or under any Federal, state or foreign law or
regulations (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"Reserve Requirement" shall mean, for any Interest Period for any
-------------------
Eurodollar Loan, the average maximum rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member banks of the
Federal Reserve System in New York City with deposits exceeding one billion
Dollars against "Eurocurrency liabilities" (as such term is used in Regulation
D). Without limiting the effect of the foregoing, the Reserve Requirement shall
include any other reserves required to be maintained by such member banks by
reason of any Regulatory Change with respect to (i) any category of liabilities
that includes deposits by reference to which the Eurodollar Base Rate for any
Interest Period for any Eurodollar Loans is to be determined as provided in the
definition of "Eurodollar Base Rate" in this Section 1.01 or (ii) any category
of extensions of credit or other assets that includes Eurodollar Loans.
"SAP" shall mean, with respect to any Insurance Subsidiary, the
---
accounting procedures and practices prescribed or permitted by the Applicable
Insurance Regulatory Authority, applied on a basis consistent with those that,
in accordance with the last sentence of Section 1.02(a) hereof, are to be used
in making the calculations for purposes of determining compliance with certain
terms of this Agreement.
"S&P Claims Rating" shall mean, as at any date of determination, the
-----------------
rating assigned by Standard & Poor's Ratings Group to PLAIC's claims paying
ability as at such date.
"S&P Rating" shall mean, as at any date of determination, the rating
----------
assigned by Standard & Poor's Ratings Group to the Company's senior unsecured
long term debt rating (unsupported by any credit enhancement) as at such date.
"SFAS 115" shall mean the Statement of Financial Accounting Standards
--------
No. 115 "Accounting for Certain Investments in Debt and Equity Securities"
issued by the Financial Accounting Standards Board.
"Subsidiary" shall mean, for the Company, any corporation, partnership
----------
or other entity of which at least a majority of the securities or other
ownership interests having by the terms thereof ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
of such corporation, partnership or other entity (irrespective of whether or not
at the time securities or other ownership interests of any other class or
classes of such corporation, partnership or other entity shall have or might
have voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by the Company or one or more
Subsidiaries of the Company or by the Company and one or more Subsidiaries of
the Company.
"Substantial Part" shall mean, as at any date of determination, 10% or
----------------
more of the assets of the Company and its Consolidated Subsidiaries on a
consolidated basis.
"Textron" shall mean Textron Inc., a Delaware corporation.
-------
"Type" shall have the meaning assigned to such term in Section 1.03
----
hereof.
"Utilization Premium" shall mean, as at any date of determination,
-------------------
five (5) basis points if, as at such time, the aggregate outstanding principal
amount of the Loans is equal to or more than one-half of the aggregate
Commitments.
"Wholly-Owned Subsidiary" shall mean any Subsidiary of which all of
-----------------------
such securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) are so owned or controlled.
"Zurich Investment" shall mean the issuance by the Company and the
-----------------
purchase by the Zurich Insurance Company of 9,523,810 shares of the Company's
common stock pursuant to a Common Stock Purchase Agreement dated as of May 31,
1996 between the Company and Zurich Insurance Company.
1.02 Accounting Terms and Determinations.
------------------------------------
(a) Except as otherwise expressly provided herein, all accounting
terms used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to the
Banks hereunder shall (unless otherwise disclosed to the Banks in writing at the
time of delivery thereof in the manner described in Section 1.02(b) hereof) be
prepared, in accordance with generally accepted accounting principles or
statutory accounting principles, as the case may be, applied on a basis
consistent with those used in the preparation of the latest financial statements
furnished to the Banks hereunder (which, prior to the delivery of the first
financial statements under Section 8.01 hereof, shall mean the financial
statements as at December 31, 1995 referred to in Section 7.02 hereof). All
calculations made for the purposes of determining compliance with this Agreement
shall (except as otherwise expressly provided herein) be made by application of
generally accepted accounting principles or statutory accounting principles, as
the case may be, applied on a basis consistent with those used in the
preparation of the latest annual or quarterly financial statements furnished to
the Banks pursuant to Section 8.01 hereof (or, prior to the delivery of the
first financial statements under said Section 8.01, used in the preparation of
the financial statements as at December 31, 1995 referred to in Section 7.02
hereof) unless (i) the Company shall have objected to determining such
compliance on such basis at the time of delivery of such financial statements or
(ii) the Majority Banks shall so object in writing within 30 days after delivery
of such financial statements, in either of which events such calculations shall
be made on a basis consistent with those used in the preparation of the latest
financial statements as to which such objection shall not have been made (which,
if objection is made in respect of the first financial statements delivered
under Section 8.01 hereof, shall mean the audited financial statements referred
to in Section 7.02 hereof).
(b) The Company shall deliver to the Banks at the same time as the
delivery of any annual or quarterly financial statement under Section 8.01
hereof (i) a description in reasonable detail of any material variation between
the application of accounting principles employed in the preparation of such
statement and the application of accounting principles employed in the
preparation of the next preceding annual or quarterly financial statements as to
which no objection has been made in accordance with the last sentence of Section
1.02(a) hereof and (ii) reasonable estimates of the difference between such
statements arising as a consequence thereof.
(c) To enable the ready and consistent determination of compliance
with the covenants set forth in Section 8 hereof, the Company will not change
the last day of its fiscal year from December 31 of each year, or the last days
of the first three fiscal quarters in each of its fiscal years from March 31,
June 30 and September 30 of each year, respectively.
1.03 Types of Loans. Loans hereunder are distinguished by "Type".
---------------
The "Type" of a Loan refers to whether such Loan is a Base Rate Loan or a
Eurodollar Loan, each of which constitutes a Type.
1.04 Moody's Ratings and S&P Ratings. All references in this
--------------------------------
Agreement to particular Moody's Ratings and S&P Ratings are references to such
ratings as currently defined by Moody's Investors Service, Inc. and Standard &
Poor's Ratings Group and in the event either such rating service changes its
ratings system, each reference to a particular rating of such rating service set
forth in this Agreement shall be deemed to be a reference to the rating under
such changed rating system which, in the reasonable judgment of the
Administrative Agent, after consultation with the rating service involved, most
closely approximates the senior unsecured long term debt rating (unsupported by
any credit enhancement) associated with the particular rating of such rating
service as currently defined.
1.05 Moody's Claims Ratings and S&P Claims Ratings. All references
----------------------------------------------
in this Agreement to particular Moody's Claims Ratings and S&P Claims Ratings
are references to such ratings as currently defined by Moody's Investors
Service, Inc. and Standard & Poor's Ratings Group and in the event either such
rating service changes its ratings system, each reference to a particular rating
of such rating service set forth in this Agreement shall be deemed to be a
reference to the rating under such changed rating system which, in the
reasonable judgment of the Administrative Agent, after consultation with the
rating service involved, most closely approximates the claims paying ability
rating associated with the particular rating of such rating service as currently
defined. If for any reason a Moody's Claims Rating or an S&P Claims Rating is
not available then the level of Applicable Margin shall be determined by the
Majority Banks after consultation with the Company, based on the Majority Banks'
good faith estimates of what such rating would have been had it been available,
the determination of the Majority Banks in such regard to be final and
conclusive.
Section 2. Commitments, Loans, Notes and Prepayments.
-----------------------------------------
2.01 Loans. Each Bank severally agrees, on the terms and conditions
------
of this Agreement, to make loans to the Company in Dollars during the period
from and including the Closing Date to but not including the Commitment
Termination Date in an aggregate principal amount at any one time outstanding up
to but not exceeding the amount of the Commitment of such Bank as in effect from
time to time, provided that in no event shall the aggregate principal amount of
--------
all Loans exceed the aggregate amount of the Commitments as in effect from time
to time; provided further that, prior to the Acquisition Date, the aggregate
principal amount of the Loans shall not exceed $400,000,000. Subject to the
terms and conditions of this Agreement, during such period the Company may
borrow, repay and reborrow the amount of the Commitments by means of Base Rate
Loans and Eurodollar Loans and may Convert Loans of one Type into Loans of
another Type (as provided in Section 2.08 hereof) or Continue Loans of one Type
as Loans of the same Type (as provided in said Section 2.08); provided that no
--------
more than seven separate Interest Periods in respect of Eurodollar Loans from
each Bank may be outstanding at any one time.
2.02 Borrowings. The Company shall give the Administrative Agent
-----------
(which shall promptly notify the Banks) notice of each borrowing hereunder as
provided in Section 4.05 hereof. Not later than 1:00 p.m. New York time on the
date specified for each borrowing hereunder, each Bank shall make available the
amount of the Loan or Loans to be made by it on such date to the Administrative
Agent, at account number NYAO-DI-900-9-000002 maintained by the Administrative
Agent with Chase at the Principal Office (or to such other account as the
Administrative Agent shall notify the Banks), in immediately available funds,
for account of the Company. The amount so received by the Administrative Agent
shall, subject to the terms and conditions of this Agreement, be made available
to the Company by depositing the same, in immediately available funds, in an
account of the Company maintained with Chase at the Principal Office designated
by the Company.
2.03 Changes of Commitments.
-----------------------
(a) The aggregate amount of the Commitments shall be automatically
reduced to zero on the Commitment Termination Date.
(b) The Company shall have the right at any time or from time to time
(i) so long as no Loans are outstanding, to terminate the Commitments and (ii)
to reduce the aggregate unused amount of the Commitments; provided that (x) the
--------
Company shall give notice of each such termination or reduction as provided in
Section 4.05 hereof and (y) each partial reduction shall be in an aggregate
amount at least equal to $10,000,000 or in multiples of $1,000,000 in excess
thereof.
(c) The Commitments are subject to mandatory reduction as provided in
Section 2.09 hereof.
(d) The Commitments once terminated or reduced may not be reinstated.
2.04 Facility Fee. The Company shall pay to the Administrative
-------------
Agent for account of each Bank a facility fee on the daily average amount of
such Bank's Commitment, whether used or unused, for the period from and
including July 30, 1996 to but not including the earlier of (x) the date such
Commitment is terminated and (y) the Commitment Termination Date, at a rate per
annum (expressed in number of basis points) equal to the amount determined by
reference to the S&P Rating and Moody's Rating as at such date:
Category Moody's Rating S&P Rating Facility Fee
- ---------- -------------- ------------------- -----------------
(a) A3 or higher A- or higher 10 basis points
(b) Less than A3 Less than A- but 12.5 basis points
but equal to equal to or greater
or greater than BBB+
than Baa1
(c) Less than Baa1 Less than BBB+ 15 basis points
but equal to but equal to or
or greater greater than BBB
than Baa2
(d) Less than Baa2 Less than BBB 20 basis points
but equal to but equal to or
or greater greater than BBB-
than Baa3
(e) Less than Baa3 Less than BBB- 25 basis points
provided, however, that in order to qualify for a particular category of
- --------
facility fee (other than in the case of clause (e) above) both the Moody's
Rating and the S&P Rating required for that category of facility fee must be
attained and, accordingly, if one rating is lower than the other, the facility
fee shall be determined on the basis of the lower of the two ratings. Each
change in any facility fee resulting from a change in the Moody's Rating or the
S&P Rating shall take effect at the time of the public announcement of such
change in the Moody's Rating or the S&P Rating, as the case may be. If either a
Moody's Rating or an S&P Rating shall not be available, the facility fee, as at
any date of determination, shall be the percentage per annum (expressed in
number of basis points) determined by reference to the Moody's Claims Rating and
the S&P Claims Rating as at such date:
Category Moody's Claims S&P Claims Rating Facility Fee
- ---------- -------------- ------------------- -----------------
Rating
--------------
(a) Aa3 or higher AA- or higher 10 basis points
(b) Less than Aa3 Less than AA- but 12.5 basis points
but equal to equal to or greater
or greater than A+
than A1
(c) Less than A1 Less than A+ 15 basis points
but equal to but equal to or
or greater greater than A
than A2
(d) Less than A2 Less than A 20 basis points
but equal to but equal to or
or greater greater than A-
than A3
(e) Less than A3 Less than A- 25 basis points
provided, however, that in order to qualify for a particular category of
- --------
facility fee (other than in the case of clause (e) above) both the Moody's
Claims Rating and the S&P Claims Rating required for that category of facility
fee must be attained and, accordingly, if one rating is lower than the other,
the facility fee shall be determined on the basis of the lower of the two
ratings. Each change in any facility fee resulting from a change in the Moody's
Claims Rating or the S&P Claims Rating shall take effect at the time of the
public announcement of such change in the Moody's Claims Rating or the S&P
Claims Rating, as the case may be. Accrued facility fee shall be payable on
each Quarterly Date and on the earlier of the date the Commitments are
terminated and the Commitment Termination Date.
2.05 Lending Offices. The Loans of each Type made by each Bank
----------------
shall be made and maintained at such Bank's Applicable Lending Office for Loans
of such Type.
2.06 Several Obligations; Remedies Independent. The failure of any
------------------------------------------
Bank to make any Loan to be made by it on the date specified therefor shall not
relieve any other Bank of its obligation to make its Loan on such date, but
neither any Bank nor the Administrative Agent shall be responsible for the
failure of any other Bank to make a Loan to be made by such other Bank, and no
Bank shall have any obligation to the Administrative Agent or any other Bank for
the failure by such Bank to make any Loan required to be made by such Bank. The
amounts payable by the Company at any time hereunder and under the Notes to each
Bank shall be a separate and independent debt and each Bank shall be entitled to
protect and enforce its rights arising out of this Agreement and the Notes, and
it shall not be necessary for any other Bank or the Administrative Agent to
consent to, or be joined as an additional party in, any proceedings for such
purposes.
2.07 Notes.
------
(a) The Loans made by each Bank shall be evidenced by a single
promissory note of the Company substantially in the form of Exhibit A hereto,
dated the date hereof, payable to such Bank in a principal amount equal to the
amount of its Commitment as originally in effect and otherwise duly completed.
(b) The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each Loan made by each Bank to the Company, and each
payment made on account of the principal thereof, shall be recorded by such Bank
on its books and, prior to any transfer of the Note held by it, endorsed by such
Bank on the schedule attached to such Note or any continuation thereof; provided
--------
that the failure of such Bank to make any such recordation or endorsement shall
not affect the obligations of the Company to make a payment when due of any
amount owing hereunder or under such Note in respect of such Loans.
(c) No Bank shall be entitled to have its Note subdivided, by
exchange for promissory notes of lesser denominations or otherwise, except in
connection with a permitted assignment of all or any portion of such Bank's
Commitment, Loans and Note pursuant to Section 11.06(b) hereof.
2.08 Optional Prepayments and Conversions or Continuations of Loans.
---------------------------------------------------------------
Subject to Section 4.04 hereof, the Company shall have the right to prepay
Loans, or to Convert Loans of one Type into Loans of another Type or Continue
Loans of one Type as Loans of the same Type, at any time or from time to time,
provided that: (a) the Company shall give the Administrative Agent notice of
- --------
each such prepayment, Conversion or Continuation as provided in Section 4.05
hereof (and, upon the date specified in any such notice of prepayment, the
amount to be prepaid shall become due and payable hereunder); and (b) if any
Eurodollar Loan is prepaid or Converted other than on the last day of an
Interest Period for such Loan, the Company shall pay to the Administrative Agent
for account of each Bank the amounts, if any, required to be paid pursuant to
Section 5.05 hereof. Notwithstanding the foregoing, and without limiting the
rights and remedies of the Banks under Section 9 hereof, in the event that any
Event of Default shall have occurred and be continuing, the Administrative Agent
may (and at the request of the Majority Banks shall) suspend the right of the
Company to Convert any Loan into a Eurodollar Loan, or to Continue any Loan as a
Eurodollar Loan, in which event all Loans shall be Converted (on the last day(s)
of the respective Interest Periods therefor) into, or Continued as, as the case
may be, Base Rate Loans.
2.09 Mandatory Prepayments and Reductions of Commitments. Upon any
----------------------------------------------------
Debt Issuance or Equity Issuance, (a) the Company shall prepay the Loans, and
(b) the Commitments shall be subject to automatic reduction, in either case in
an aggregate amount equal to 100% of the Net Available Proceeds thereof. Any
such prepayment shall be paid to the Administrative Agent for account of the
Banks and shall be accompanied by the aggregate amount of accrued interest and
facility fee thereon, together with any amounts payable under Section 5.05
hereof.
Section 3. Payments of Principal and Interest.
----------------------------------
3.01 Repayment of Loans. The Company hereby promises to pay to the
-------------------
Administrative Agent for account of each Bank the entire outstanding principal
amount of such Bank's Loans, and each Loan shall mature, on the Commitment
Termination Date.
3.02 Interest. The Company hereby promises to pay to the
---------
Administrative Agent for account of each Bank interest on the unpaid principal
amount of each Loan made by such Bank for the period from and including the date
of such Loan to but excluding the date such Loan shall be paid in full, at the
following rates per annum:
(a) during such periods as such Loan is a Base Rate Loan, the Base
Rate (as in effect from time to time) plus the Applicable Margin; and
----
(b) during such periods as such Loan is a Eurodollar Loan, for each
Interest Period relating thereto, the Eurodollar Rate for such Interest
Period plus the Applicable Margin.
----
Notwithstanding the foregoing, the Company hereby promises to pay to the
Administrative Agent for account of each Bank interest at the applicable Post-
Default Rate on any principal of any Loan made by such Bank and on any other
amount payable by the Company hereunder or under the Note held by such Bank to
or for account of such Bank, that shall not be paid in full when due (whether at
stated maturity, by acceleration, by mandatory prepayment or otherwise), for the
period from and including the due date thereof to but excluding the date the
same is paid in full. Accrued interest on each Loan shall be payable (i) in the
case of a Base Rate Loan, quarterly on the Quarterly Dates, (ii) in the case of
a Eurodollar Loan, on the last day of each Interest Period therefor and, if such
Interest Period is longer than three months, at three-month intervals following
the first day of such Interest Period, and (iii) in the case of any Loan, upon
the payment or prepayment thereof or the Conversion of such Loan to a Loan of
another Type (but only on the principal amount so paid, prepaid or Converted),
except that interest payable at the Post-Default Rate shall be payable from time
to time on demand. Promptly after the determination of any interest rate
provided for herein or any change therein, the Administrative Agent shall give
notice thereof to the Banks to which such interest is payable and to the
Company.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
------------------------------------------------
4.01 Payments.
---------
(a) Except to the extent otherwise provided herein, all payments of
principal, interest and other amounts to be made by the Company under this
Agreement and the Notes, and, except to the extent otherwise provided therein,
all payments to be made by the Company under any other Basic Document, shall be
made in Dollars, in immediately available funds, without deduction, set-off or
counterclaim, to the Administrative Agent at account number NYAO-DI-900-9-000002
maintained by the Administrative Agent with Chase at the Principal Office (or to
such other account as the Administrative Agent shall notify the Company), not
later than 1:00 p.m. New York time on the date on which such payment shall
become due (each such payment made after such time on such due date to be deemed
to have been made on the next succeeding Business Day).
(b) If any Event of Default shall be continuing, any Bank for whose
account any such payment is to be made may (but shall not be obligated to) debit
the amount of any such payment that is not made by such time to any ordinary
deposit account of the Company with such Bank (with notice to the Company and
the Administrative Agent), provided that such Bank's failure to give such notice
--------
shall not affect the validity thereof.
(c) Subject to Section 4.02 hereof, the Company shall, at the time of
making each payment under this Agreement or any Note for account of any Bank,
specify to the Administrative Agent (which shall so notify the intended
recipient(s) thereof) the Loans or other amounts payable by the Company
hereunder to which such payment is to be applied (and in the event that the
Company fails to so specify, or if an Event of Default has occurred and is
continuing, the Administrative Agent may distribute such payment to the Banks
for application in such manner as it or the Majority Banks, subject to Section
4.02 hereof, may determine to be appropriate).
(d) Each payment received by the Administrative Agent under this
Agreement or any Note for account of any Bank shall be paid by the
Administrative Agent promptly to such Bank, in immediately available funds, for
account of such Bank's Applicable Lending Office for the Loan or other
obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement or any Note
would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable for
any principal so extended for the period of such extension.
4.02 Pro Rata Treatment. Except to the extent otherwise provided
-------------------
herein: (a) each borrowing from the Banks under Section 2.01 hereof shall be
made from the Banks, each payment of facility fee under Section 2.04 hereof
shall be made for account of the Banks, and each termination or reduction of the
amount of the Commitments under Sections 2.03 and 2.09 hereof shall be applied
to the respective Commitments of the Banks, pro rata according to the amounts of
their respective Commitments; (b) except as otherwise provided in Section 5.04
hereof, Loans having the same Interest Period shall be allocated pro rata among
the Banks according to the amounts of their respective Commitments (in the case
of making of Loans) or their respective Loans (in the case of Conversions and
Continuations of Loans); (c) each payment or prepayment of principal of Loans by
the Company shall be made for account of the Banks pro rata in accordance with
the respective unpaid principal amounts of the Loans held by them, provided that
--------
if immediately prior to giving effect to any such payment in respect of any
Loans the outstanding principal amount of the Loans shall not be held by the
Banks pro rata in accordance with their respective Commitments in effect at the
time such Loans were made (by reason of a failure of a Bank to make a Loan
hereunder in the circumstances described in the last paragraph of Section 11.04
hereof), then such payment shall be applied to the Loans in such manner as shall
result, as nearly as is practicable, in the outstanding principal amount of the
Loans being held by the Banks pro rata in accordance with their respective
Commitments; and (d) each payment of interest on Loans by the Company shall be
made for account of the Banks pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective Banks.
4.03 Computations. Interest on Eurodollar Loans and facility fee
-------------
shall be computed on the basis of a year of 360 days and actual days elapsed
(including the first day but excluding the last day) occurring in the period for
which payable and interest on Base Rate Loans shall be computed on the basis of
a year of 365 or 366 days, as the case may be, and actual days elapsed
(including the first day but excluding the last day) occurring in the period for
which payable. Notwithstanding the foregoing, for each day that the Base Rate
is calculated by reference to the Federal Funds Rate, interest on Base Rate
Loans shall be computed on the basis of a year of 360 days and actual days
elapsed.
4.04 Minimum Amounts. Except for mandatory prepayments made
----------------
pursuant to Section 2.09 hereof and Conversions or prepayments made pursuant to
Section 5.04 hereof, each borrowing, Conversion and partial prepayment of
principal of Loans shall be in an aggregate amount at least equal to $10,000,000
(or, in the case of a borrowing of a Base Rate Loan, $5,000,000) or in multiples
of $1,000,000 in excess thereof (borrowings, Conversions or prepayments of or
into Loans of different Types or, in the case of Eurodollar Loans, having
different Interest Periods at the same time hereunder to be deemed separate
borrowings, Conversions and prepayments for purposes of the foregoing, one for
each Type or Interest Period). Anything in this Agreement to the contrary
notwithstanding, the aggregate principal amount of Eurodollar Loans having the
same Interest Period shall be in an amount at least equal to $10,000,000 or in
multiples of $1,000,000 in excess thereof and, if any Eurodollar Loans would
otherwise be in a lesser principal amount for any period, such Loans shall be
Base Rate Loans during such period.
4.05 Certain Notices. Notices by the Company to the Administrative
----------------
Agent of terminations or reductions of the Commitments, of borrowings,
Conversions, Continuations and optional prepayments of Loans, of Types of Loans
and of the duration of Interest Periods shall be irrevocable and shall be
effective only if received by the Administrative Agent not later than 10:00 a.m.
New York time on the number of Business Days prior to the date of the relevant
termination, reduction, borrowing, Conversion, Continuation or prepayment or the
first day of such Interest Period specified below:
Number of
Business
Notice Days Prior
- -------------------------------------- ----------
Termination or reduction
of Commitments 2
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans 0
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans 3
Each such notice of termination or reduction shall specify the amount of the
Commitments to be terminated or reduced. Each such notice of borrowing,
Conversion, Continuation or optional prepayment shall specify the Loans to be
borrowed, Converted, Continued or prepaid and the amount (subject to Section
4.04 hereof) and Type of each Loan to be borrowed, Converted, Continued or
prepaid (and, in the case of a Conversion, the Type of Loan to result from such
Conversion) and the date of borrowing, Conversion, Continuation or optional
prepayment (which shall be a Business Day). Each such notice of the duration of
an Interest Period shall specify the Loans to which such Interest Period is to
relate. The Administrative Agent shall promptly notify the Banks of the
contents of each such notice. In the event that the Company fails to select the
Type of Loan, or the duration of any Interest Period for any Eurodollar Loan,
within the time period and otherwise as provided in this Section 4.05, such Loan
(if outstanding as a Eurodollar Loan) will be automatically Converted into a
Base Rate Loan on the last day of the then current Interest Period for such Loan
or (if outstanding as a Base Rate Loan) will remain as, or (if not then
outstanding) will be made as, a Base Rate Loan.
4.06 Non-Receipt of Funds by the Administrative Agent. Unless the
-------------------------------------------------
Administrative Agent shall have been notified by a Bank or the Company (the
"Payor") prior to the date on which the Payor is to make payment to the
- ------
Administrative Agent of (in the case of a Bank) the proceeds of a Loan to be
made by it hereunder or (in the case of the Company) a payment to the
Administrative Agent for account of one or more of the Banks hereunder (such
payment being herein called the "Required Payment"), which notice shall be
-------- -------
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient(s) on such date and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient(s) of such payment
shall, on demand, repay to the Administrative Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Administrative
Agent until the date the Administrative Agent recovers such amount at a rate per
annum equal to the Federal Funds Rate for such day and, if such recipient(s)
shall fail promptly to make such payment, the Administrative Agent shall be
entitled to recover such amount, on demand, from the Payor, together with
interest as aforesaid.
4.07 Sharing of Payments, Etc.
--------------------------
(a) The Company agrees that, in addition to (and without limitation
of) any right of set-off, banker's lien or counterclaim a Bank may otherwise
have, each Bank shall be entitled, at its option if an Event of Default shall be
continuing, to offset balances held by it for account of the Company at any of
its offices, in Dollars or in any other currency, against any principal of or
interest on any of such Bank's Loans or any other amount payable to such Bank
hereunder, that is not paid when due (regardless of whether such balances are
then due to the Company), in which case it shall promptly notify the Company and
the Administrative Agent thereof, provided that such Bank's failure to give such
--------
notice shall not affect the validity thereof.
(b) If any Bank shall obtain from the Company payment of any
principal of or interest on any Loan owing to it or payment of any other amount
under this Agreement or any other Basic Document through the exercise of any
right of set-off, banker's lien or counterclaim or similar right or otherwise
(other than from the Administrative Agent as provided herein), and, as a result
of such payment, such Bank shall have received a greater percentage of the
principal of or interest on the Loans or such other amounts then due hereunder
or thereunder by the Company to such Bank than the percentage received by any
other Bank, it shall promptly purchase from such other Banks participations in
(or, if and to the extent specified by such Bank, direct interests in) the Loans
or such other amounts, respectively, owing to such other Banks (or in interest
due thereon, as the case may be) in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that all the
Banks shall share the benefit of such excess payment (net of any expenses that
may be incurred by such Bank in obtaining or preserving such excess payment) pro
rata in accordance with the unpaid principal of and/or interest on the Loans or
such other amounts, respectively, owing to each of the Banks, provided that if
--------
at the time of such payment the outstanding principal amount of the Loans shall
not be held by the Banks pro rata in accordance with their respective
Commitments in effect at the time such Loans were made (by reason of a failure
of a Bank to make a Loan hereunder in the circumstances described in the last
paragraph of Section 11.04 hereof), then such purchases of participations and/or
direct interests shall be made in such manner as will result, as nearly as is
practicable, in the outstanding principal amount of the Loans being held by the
Banks pro rata according to the amounts of such Commitments. To such end all
the Banks shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if such payment is rescinded or must otherwise
be restored.
(c) The Company agrees that any Bank so purchasing such a
participation (or direct interest) may exercise all rights of set-off, banker's
lien, counterclaim or similar rights with respect to such participation as fully
as if such Bank were a direct holder of Loans or other amounts (as the case may
be) owing to such Bank in the amount of such participation.
(d) Nothing contained herein shall require any Bank to exercise any
such right or shall affect the right of any Bank to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of the Company. If, under any applicable bankruptcy, insolvency or
other similar law, any Bank receives a secured claim in lieu of a set-off to
which this Section 4.07 applies, such Bank shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Banks entitled under this Section 4.07 to share in the
benefits of any recovery on such secured claim.
Section 5. Yield Protection, Etc.
----------------------
5.01 Additional Costs.
-----------------
(a) The Company shall pay directly to each Bank from time to time
such amounts as such Bank may determine to be necessary to compensate such Bank
for any costs that such Bank determines are attributable to its making or
maintaining of any Eurodollar Loans or its obligation to make any Eurodollar
Loans hereunder, or any reduction in any amount receivable by such Bank
hereunder in respect of any of such Loans or such obligation (such increases in
costs and reductions in amounts receivable being herein called "Additional
----------
Costs"), resulting from any Regulatory Change that:
(i) changes the basis of taxation of any amounts payable to such
Bank under this Agreement or its Note in respect of any of such Loans
(other than taxes imposed on or measured by the overall net income of such
Bank or of its Applicable Lending Office for any of such Loans by the
jurisdiction in which such Bank has its principal office or such Applicable
Lending Office); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than the Reserve Requirement used in the determination
of the Eurodollar Rate for any Interest Period for such Loan) relating to
any extensions of credit or other assets of, or any deposits with or other
liabilities of, such Bank (including, without limitation, any of such Loans
or any deposits referred to in the definition of "Eurodollar Base Rate" in
Section 1.01 hereof), or any commitment of such Bank (including, without
limitation, the Commitment of such Bank hereunder); or
(iii) imposes any other condition affecting this Agreement or its
Note (or any of such extensions of credit or liabilities) or its
Commitment.
If any Bank requests compensation from the Company under this Section 5.01(a),
the Company may, by notice to such Bank (with a copy to the Administrative
Agent), suspend the obligation of such Bank thereafter to make or Continue
Eurodollar Loans, or to Convert Loans of any other Type into Eurodollar Loans,
until the Regulatory Change giving rise to such request ceases to be in effect
(in which case the provisions of Section 5.04 hereof shall be applicable),
provided that such suspension shall not affect the right of such Bank to receive
- --------
the compensation so requested.
(b) Without limiting the effect of the provisions of Section 5.01(a)
hereof, in the event that, by reason of any Regulatory Change, any Bank either
(i) incurs Additional Costs based on or measured by the excess above a specified
level of the amount of a category of deposits or other liabilities of such Bank
that includes deposits by reference to which the interest rate on Eurodollar
Loans is determined as provided in this Agreement or a category of extensions of
credit or other assets of such Bank that includes Eurodollar Loans or (ii)
becomes subject to restrictions on the amount of such a category of liabilities
or assets that it may hold, then, if such Bank so elects by notice to the
Company (with a copy to the Administrative Agent), the obligation of such Bank
to make or Continue, or to Convert Loans of any other Type into, Eurodollar
Loans hereunder shall be suspended until such Regulatory Change ceases to be in
effect (in which case the provisions of Section 5.04 hereof shall be
applicable).
(c) Without limiting the effect of the foregoing provisions of this
Section 5.01 (but without duplication), the Company shall pay directly to each
Bank from time to time on request such amounts as such Bank may determine to be
necessary to compensate such Bank (or, without duplication, the bank holding
company of which such Bank is a subsidiary) for any costs that it determines are
attributable to the maintenance by such Bank (or any Applicable Lending Office
or such bank holding company), pursuant to any law or regulation or any
interpretation, directive or request (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) of any court or
governmental or monetary authority (i) following any Regulatory Change or (ii)
implementing any risk-based capital guideline or other requirement (whether or
not having the force of law and whether or not the failure to comply therewith
would be unlawful) heretofore or hereafter issued by any government or
governmental or supervisory authority implementing at the national or supra-
national level the Basel Accord (including, without limitation, the Final Risk-
Based Capital Guidelines of the Board of Governors of the Federal Reserve System
(12 C.F.R. Part 208, Appendix A; 12 C.F.R. Part 225, Appendix A) and the Final
Risk-Based Capital Guidelines of the Office of the Comptroller of the Currency
(12 C.F.R. Part 3, Appendix A)), of capital in respect of its Commitment or
Loans (such compensation to include, without limitation, an amount equal to any
reduction of the rate of return on assets or equity of such Bank (or any
Applicable Lending Office or such bank holding company) to a level below that
which such Bank (or any Applicable Lending Office or such bank holding company)
could have achieved but for such law, regulation, interpretation, directive or
request).
(d) Each Bank shall notify the Company of any event occurring after
the date hereof entitling such Bank to compensation under Section 5.01(a) or (c)
hereof as promptly as practicable, but in any event within 45 days, after such
Bank obtains actual knowledge thereof; provided that (i) if any Bank fails to
--------
give such notice within 45 days after it obtains actual knowledge of such an
event, such Bank shall, with respect to compensation payable pursuant to this
Section 5.01 in respect of any costs resulting from such event, only be entitled
to payment under this Section 5.01 for costs incurred from and after the date 45
days prior to the date that such Bank does give such notice and (ii) each Bank
will designate a different Applicable Lending Office for the Loans of such Bank
affected by such event if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the sole opinion of such Bank,
be disadvantageous to such Bank, except that such Bank shall have no obligation
to designate an Applicable Lending Office located in the United States of
America. Each Bank will furnish to the Company a certificate setting forth the
basis and amount of each request by such Bank for compensation under Section
5.01(a) or (c) hereof. Determinations and allocations by any Bank for purposes
of this Section 5.01 of the effect of any Regulatory Change pursuant to Section
5.01(a) hereof, or of the effect of capital maintained pursuant to Section 5.01
hereof, on its costs or rate of return of maintaining Loans or its obligation to
make Loans, or on amounts receivable by it in respect of Loans, and of the
amounts required to compensate such Bank under this Section 5.01, shall be
conclusive, provided that such determinations and allocations are made on a
--------
reasonable basis.
5.02 Limitation on Types of Loans. Anything herein to the contrary
-----------------------------
notwithstanding, if, on or prior to the determination of the Eurodollar Base
Rate for any Interest Period for any Eurodollar Loan:
(a) the Administrative Agent determines, which determination shall be
conclusive, that quotations of interest rates for the relevant deposits
referred to in the definition of "Eurodollar Base Rate" in Section 1.01
hereof are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for Eurodollar
Loans as provided herein; or
(b) the Majority Banks determine, which determination shall be
conclusive, and notify the Administrative Agent that the relevant rates of
interest referred to in the definition of "Eurodollar Base Rate" in Section
1.01 hereof upon the basis of which the rate of interest for Eurodollar
Loans for such Interest Period is to be determined are not likely
adequately to cover the cost to such Banks of making or maintaining
Eurodollar Loans for such Interest Period;
then the Administrative Agent shall give the Company and each Bank prompt notice
thereof and, so long as such condition remains in effect, the Banks shall be
under no obligation to make additional Eurodollar Loans, to Continue Eurodollar
Loans or to Convert Loans of any other Type into Eurodollar Loans, and the
Company shall, on the last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Loans, either prepay such Loans or Convert such Loans
into another Type of Loan in accordance with Section 2.08 hereof.
5.03 Illegality. Notwithstanding any other provision of this
-----------
Agreement, in the event that it becomes unlawful for any Bank or its Applicable
Lending Office to honor its obligation to make or maintain Eurodollar Loans
hereunder (and, in the sole opinion of such Bank, the designation of a different
Applicable Lending Office would either not avoid such unlawfulness or would be
disadvantageous to such Bank), then such Bank shall promptly notify the Company
thereof (with a copy to the Administrative Agent) and such Bank's obligation to
make or Continue, or to Convert Loans of any other Type into, Eurodollar Loans
shall be suspended until such time as such Bank may again make and maintain
Eurodollar Loans (in which case the provisions of Section 5.04 hereof shall be
applicable). Subject to the first parenthetical in the preceding sentence, any
Bank subject to any such illegality shall use reasonable efforts to designate a
different Applicable Lending Office to avoid such illegality.
5.04 Treatment of Affected Loans. If the obligation of any Bank to
----------------------------
make Eurodollar Loans or to Continue, or to Convert Base Rate Loans into,
Eurodollar Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof,
such Bank's Eurodollar Loans shall be automatically Converted into Base Rate
Loans on the last day(s) of the then current Interest Period(s) for Eurodollar
Loans (or, in the case of a Conversion required by Section 5.01(b) or 5.03
hereof, on such earlier date as such Bank may specify to the Company with a copy
to the Administrative Agent) and, unless and until such Bank gives notice as
provided below that the circumstances specified in Section 5.01 or 5.03 hereof
that gave rise to such Conversion no longer exist:
(a) to the extent that such Bank's Eurodollar Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Bank's Eurodollar Loans shall be applied instead to its
Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such Bank
as Eurodollar Loans shall be made or Continued instead as Base Rate Loans,
and all Loans of such Bank that would otherwise be Converted into
Eurodollar Loans shall remain as Base Rate Loans.
If such Bank gives notice to the Company with a copy to the Administrative Agent
that the circumstances specified in Section 5.01 or 5.03 hereof that gave rise
to the Conversion of such Bank's Eurodollar Loans pursuant to this Section 5.04
no longer exist (which such Bank agrees to do promptly upon such circumstances
ceasing to exist) at a time when Eurodollar Loans made by other Banks are
outstanding, such Bank's Base Rate Loans shall be automatically Converted, on
the first day(s) of the next succeeding Interest Period(s) for such outstanding
Eurodollar Loans, to the extent necessary so that, after giving effect thereto,
all Loans held by the Banks holding Eurodollar Loans and by such Bank are held
pro rata (as to principal amounts, Types and Interest Periods) in accordance
with their respective Commitments.
5.05 Compensation. The Company shall pay to the Administrative
-------------
Agent for account of each Bank, upon the request of such Bank through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Bank) to compensate it for any loss, cost or expense
that such Bank determines is attributable to:
(a) any payment, mandatory or optional prepayment or Conversion of a
Eurodollar Loan made by such Bank for any reason (including, without
limitation, the acceleration of the Loans pursuant to Section 9 hereof) on
a date other than the last day of the Interest Period for such Loan; or
(b) any failure by the Company for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 6 hereof to be satisfied) to borrow, Continue or Convert into a
Eurodollar Loan from such Bank on the date for such borrowing, Continuation
or Conversion specified in the relevant notice of borrowing, Continuation
or Conversion given pursuant to Section 2.02 or 4.05 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid,
Converted or not borrowed for the period from the date of such payment,
prepayment, Conversion or failure to borrow to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for such Loan that would have commenced on the date specified
for such borrowing) at the applicable rate of interest for such Loan provided
for herein over (ii) the amount of interest that otherwise would have accrued on
such principal amount at a rate per annum equal to the interest component of the
amount such Bank would have bid in the London interbank market for Dollar
deposits of leading banks in amounts comparable to such principal amount and
with maturities comparable to such period (as reasonably determined by such
Bank).
5.06 U.S. Taxes.
-----------
(a) The Company agrees to pay to each Bank that is not a U.S. Person
such additional amounts as are necessary in order that the net payment of any
amount due to such non-U.S. Person hereunder and under its Note after deduction
for or withholding in respect of any U.S. Taxes imposed with respect to such
payment (or in lieu thereof, payment of such U.S. Taxes by such non-U.S.
Person), will not be less than the amount stated herein to be then due and
payable, provided that the foregoing obligation to pay such additional amounts
--------
shall not apply:
(i) to any payment to any Bank hereunder unless such Bank is, on the
date hereof (or on the date it becomes a Bank hereunder as provided in
Section 11.06(b) hereof) and on the date of any change in the Applicable
Lending Office of such Bank, either entitled to submit a Form 1001
(relating to such Bank and entitling it to a complete exemption from
withholding on all interest to be received by it hereunder in respect of
the Loans) or Form 4224 (relating to all interest to be received by such
Bank hereunder in respect of the Loans), or
(ii) to any U.S. Taxes imposed solely by reason of the failure by such
non-U.S. Person to comply with applicable certification, information,
documentation or other reporting requirements concerning the nationality,
residence, identity or connections with the United States of America of
such non-U.S. Person if such compliance is required by statute or
regulation of the United States of America as a precondition to relief or
exemption from such U.S. Taxes.
For the purposes of this Section 5.06(a), (A) "U.S. Person" shall mean a
-----------
citizen, national or resident of the United States of America, a corporation,
partnership or other entity created or organized in or under any laws of the
United States of America or any State thereof, or any estate or trust that is
subject to Federal income taxation regardless of the source of its income, (B)
"U.S. Taxes" shall mean any present or future tax, assessment or other charge or
- -----------
levy imposed by or on behalf of the United States of America or any taxing
authority thereof or therein, (C) "Form 1001" shall mean Form 1001 (Ownership,
---------
Exemption, or Reduced Rate Certificate) of the Department of the Treasury of the
United States of America and (D) "Form 4224" shall mean Form 4224 (Exemption
---------
from Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States) of the Department of the Treasury of the
United States of America. Each of the Forms referred to in the foregoing
clauses (C) and (D) shall include such successor and related forms as may from
time to time be adopted by the relevant taxing authorities of the United States
of America to document a claim to which such Form relates.
(b) Within 30 days after paying any amount to the Administrative
Agent or any Bank from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the Company
shall deliver to the Administrative Agent for delivery to such non-U.S. Person
evidence satisfactory to such Person of such deduction, withholding or payment
(as the case may be).
5.07 Replacement of Bank. Provided that no Default shall have
--------------------
occurred and be continuing, the Company may, at any time, replace any Bank that
has requested compensation from the Company pursuant to Section 5.01(a) or (c)
or Section 5.06 hereof or has invoked Section 5.03 hereof and whose Commitment
at such time (together with the Commitments of all other Banks being replaced at
such time) does not exceed 30% of the aggregate amount of the Commitments at
such time, by giving not less than ten (10) Business Days' prior written notice
to the Administrative Agent (which shall promptly notify such Bank), that it
intends to replace such Bank with respect to its Commitment with one or more
financial institutions (including, but not limited to, any other Bank under this
Agreement) selected by the Company and acceptable to the Administrative Agent
(acting reasonably). Upon the effective date of any replacement, the Company
shall pay (or cause to be paid) to the Bank being replaced any amounts owing to
such Bank hereunder (including, without limitation, the aggregate principal
amount of its Loans, accrued interest thereon, any accrued facility fee, amounts
payable pursuant to Section 5.05 hereof and any amounts payable under Section
5.01 or 5.06 hereof, collectively, the "Termination Costs"), whereupon each
-----------------
replacement bank shall become a "Bank" for all purposes of this Agreement having
a Commitment in the amount of such Bank's Commitment assumed by it, and such
Commitment of the Bank being replaced shall be terminated upon such effective
date and all of such Bank's rights and obligations under this Agreement shall
terminate (provided that the obligations of the Company under Section 5.01, 5.05
and 11.03 hereof to such Bank shall survive such replacement as provided in
Section 11.07 hereof).
Section 6. Conditions Precedent.
--------------------
6.01 Initial Loan. The obligation of any Bank to make its initial
-------------
Loan hereunder is subject to (i) the condition precedent that such Loan shall be
made on or before November 1, 1996, (ii) in respect of documentary matters, the
receipt by the Administrative Agent of the following documents, each of which
shall be satisfactory to the Administrative Agent (and to the extent specified
below, to each Bank) in form and substance and (iii) in respect of
nondocumentary matters, the satisfaction of the specified condition precedent to
the satisfaction of the Administrative Agent (and, to the extent specified
below, each Bank):
(a) Corporate Documents. The following documents, each certified as
-------------------
indicated below:
(i) for the Company, a copy of the certificate of incorporation,
as amended and in effect, of the Company certified as of a recent date
by the Secretary of State of its jurisdiction of incorporation, and a
certificate from such Secretary of State dated as of a recent date as
to the good standing of and charter documents filed by the Company;
(ii) for the Company, a certificate of the Secretary or an
Assistant Secretary of the Company, dated the Closing Date and
certifying (A) that attached thereto is a true and complete copy of
the by-laws of the Company as amended and in effect at all times from
the date on which the resolutions referred to in clause (B) below were
adopted to and including the date of such certificate, (B) that
attached thereto is a true and complete copy of resolutions duly
adopted by the board of directors of the Company authorizing the
execution, delivery and performance of such of the Basic Documents to
which the Company is or is intended to be a party and the Loans
hereunder, and that such resolutions have not been modified, rescinded
or amended and are in full force and effect, (C) that the charter of
the Company has not been amended since the date of the certification
thereto furnished pursuant to clause (i) above, and (D) as to the
incumbency and specimen signature of each officer of the Company
executing such of the Basic Documents to which the Company is intended
to be a party and each other document to be delivered by the Company
from time to time in connection therewith (and the Administrative
Agent and each Bank may conclusively rely on such certificate until it
receives notice in writing from the Company); and
(iii) for the Company, a certificate of another officer of the
Company as to the incumbency and specimen signature of the Secretary
or Assistant Secretary, as the case may be, of the Company.
(b) Officer's Certificate. A certificate of a senior officer of the
---------------------
Company, dated the Closing Date, to the effect set forth in the first
sentence of Section 6.03 hereof.
(c) Opinion of Counsel to the Company. An opinion, dated the Closing
---------------------------------
Date, of Glenn P. Felton, Vice President and Managing Corporate Counsel of
the Company, substantially in the form of Exhibit B hereto and covering
such other matters as the Administrative Agent or any Bank may reasonably
request (and the Company hereby instructs such counsel to deliver such
opinion to the Banks and the Administrative Agent).
(d) Opinion of Special New York Counsel to the Banks. An opinion,
------------------------------------------------
dated the Closing Date, of Vedder, Price, Kaufman, Kammholz & Day, special
New York counsel to the Banks, substantially in the form of Exhibit C
hereto.
(e) Notes. The Notes, duly completed and executed.
-----
(f) Repayment of Refinanced Debt. Evidence of the concurrent
----------------------------
repayment of the Company's Refinanced Debt (the "Refinancing") and the
-----------
termination of the commitments thereunder.
(g) Payment of Fees and Expenses. Evidence of the payment by the
----------------------------
Company of (i) the upfront fee, if any, payable to each Bank as separately
agreed by such Bank and Chase, (ii) such fees as the Company shall have
separately agreed to pay to Chase and (iii) amounts owing under Section
11.03 hereof to the extent it has received invoices therefor on or before
the date of the initial borrowing hereunder.
(h) Insurance. A certificate of a senior officer of the Company
---------
describing in reasonable detail the types and amounts of insurance
maintained by the Company and its Subsidiaries, which types and amounts
shall be satisfactory to the Banks.
(i) Reserves. An opinion of the senior actuaries of the Insurance
--------
Subsidiaries as to the adequacy of the Insurance Subsidiaries' reserves.
(j) Litigation. The Banks' satisfaction with any litigation or
----------
proceedings affecting the Company or any of its Subsidiaries and deemed
material by the Banks.
(k) Other Documents. Such other documents as the Administrative Agent
---------------
or any Bank or special New York counsel to the Banks may reasonably
request.
6.02 Acquisition/Post-Acquisition Loan. The obligation of any Bank
----------------------------------
to make any Loan hereunder on (or its first Loan to be made at any time after)
the Acquisition Date is subject to (i) in respect of documentary matters, the
receipt by the Administrative Agent of the following documents, each of which
shall be satisfactory to the Administrative Agent (and to the extent specified
below, to each Bank) in form and substance and (ii) in respect of nondocumentary
matters, the satisfaction of the specified condition precedent to the
satisfaction of the Administrative Agent (and, to the extent specified below,
each Bank):
(a) Acquisition. The Banks' review and satisfaction with the terms
-----------
and conditions of the Acquisition and the Zurich Investment, the other
transactions contemplated hereby and thereby and the documentation relating
to each thereof, including, without limitation, the Purchase Agreement, and
the Acquisition and the Zurich Investment shall be concurrently, or shall
have become, effective.
(b) Projections. The Banks' review of and satisfaction with the
-----------
Company's projections and pro forma financial statements reflecting the
forecasted financial condition, income and expenses of the Company and its
Subsidiaries after giving effect to the borrowings hereunder, the
Acquisition and the other transactions contemplated hereby.
(c) Purchase Agreement. A certified copy of the Purchase Agreement
------------------
(together with all exhibits and schedules thereto), which shall have been
duly approved by the boards of directors of the Company and Paul Revere and
shall have been duly executed and delivered by the parties thereto and
shall be in full force and effect. All conditions to the Acquisition
contained in the Purchase Agreement shall have been met in all material
respects or waived with the concurrence of the Banks, acting reasonably.
(d) Available Cash. Evidence that the aggregate amount of the funds
--------------
available to the Company in the form of Loans that may be borrowed
utilizing available Commitments hereunder and available cash and cash
equivalents shall be sufficient to consummate the Acquisition and the
Refinancing.
(e) Margin Regulations. The Banks' satisfaction that the borrowings
------------------
hereunder shall be in full compliance with all legal requirements,
including, without limitation, Regulations G, T, U and X.
(f) Legal Compliance. Evidence of compliance with all applicable U.S.
----------------
federal, state and local laws and regulations, where such compliance is
material, and evidence that all material and necessary licenses, permits
and governmental and third-party consents, filings and notices to effect
the Acquisition shall have been obtained and shall be in full force and
effect, including without limitation: (i) the approval of the Commissioners
of Insurance of the Commonwealth of Massachusetts and the State of
Delaware; (ii) any consents which may be required under the insurance laws
of any state in which Paul Revere or any of its subsidiaries conducts any
business or owns any assets; and (iii) filings pursuant by the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended, shall have been made
and the waiting period thereunder shall have expired or been terminated
without any injunction or enforcement action having been taken by the
Federal Trade Commission or the Department of Justice in respect thereof.
(g) Litigation. The Banks' satisfaction with any litigation or other
----------
proceedings with respect to the Acquisition or the other transactions
contemplated thereby.
(h) Due Diligence. Satisfactory completion of other due diligence
-------------
customary for a transaction of this type.
(i) Capital. Evidence that the Company's capital structure is as
-------
reflected in Section 7.16 hereof.
(j) Other Documents. Such other documents as the Administrative
---------------
Agent or any Bank or special New York counsel to the Banks may reasonably
request.
6.03 Initial and Subsequent Loans. The obligation of the Banks to
-----------------------------
make any Loan to the Company upon the occasion of each borrowing hereunder
(including the initial borrowing) is subject to the further conditions precedent
that, both immediately prior to the making of such Loan and also after giving
effect thereto and to the intended use thereof: (a) no Default shall have
occurred and be continuing; and (b) the representations and warranties made by
the Company in Section 7 hereof and in the other Basic Documents shall be true
and complete on and as of the date of the making of such Loan with the same
force and effect as if made on and as of such date (or, if any such
representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date). Each notice of borrowing by the
Company hereunder shall constitute a certification by the Company to the effect
set forth in the preceding sentence (both as of the date of such notice and,
unless the Company otherwise notifies the Administrative Agent prior to the date
of such borrowing, as of the date of such borrowing).
Section 7. Representations and Warranties. The Company represents
------------------------------
and warrants to the Administrative Agent and the Banks that:
7.01 Corporate Existence. Each of the Company and its Subsidiaries:
--------------------
(a) is a corporation, partnership or other entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization; (b) has all requisite corporate or other power, and has all
material governmental licenses, authorizations, consents and approvals necessary
to own its assets and carry on its business as now being or as proposed to be
conducted; and (c) is qualified to do business and is in good standing in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure so to qualify could (either
individually or in the aggregate) have a Material Adverse Effect.
7.02 Financial Condition.
--------------------
(a) The consolidated and, in the case of the Company only,
unconsolidated statements of financial condition of the Company and its
Consolidated Subsidiaries as at December 31, 1995 and the related consolidated
and unconsolidated statements of operations, stockholders' equity and changes in
cash flows of the Company and its Consolidated Subsidiaries for the fiscal year
ended on said date, with the opinion thereon (in the case of said consolidated
statement of financial condition and statements) of Ernst & Young LLP and the
unaudited consolidated and unconsolidated statements of financial condition of
the Company and its Consolidated Subsidiaries as at March 31, 1996 and the
related consolidated and unconsolidated statements of operations, stockholders'
equity and cash flows of the Company and its Consolidated Subsidiaries for the
three-month period ended on such date, heretofore furnished to each of the
Banks, are complete and correct and fairly present in all material respects the
consolidated financial position of the Company and its Consolidated
Subsidiaries, and the unconsolidated financial condition of the Company, as at
said dates and the consolidated and, in the case of the Company only,
unconsolidated results of their operations and their cash flows for the fiscal
year and three-month period ended on said dates (subject, in the case of such
financial statements as at March 31, 1996, to normal year-end audit
adjustments), all in accordance with generally accepted accounting principles
and practices applied on a consistent basis. Neither the Company nor any of its
Subsidiaries had on said dates any material contingent liabilities, liabilities
for taxes, unusual forward or long-term commitments or unrealized or anticipated
losses from any unfavorable commitments, except as referred to or reflected or
provided for in said statements of financial condition as at said dates. Since
December 31, 1995, there has been no material adverse change in the consolidated
financial condition, operations, business, assets (and nature thereof),
liabilities (including, without limitation, tax, ERISA and environmental
liabilities) or prospects taken as a whole of the Company and its Consolidated
Subsidiaries from that set forth in said financial statements as at said date.
(b) With respect to each Insurance Subsidiary, the statutory
financial statements of such Insurance Subsidiary as at December 31, 1995, as
filed with its Applicable Insurance Regulatory Authority, and the quarterly
statement for the three-month period ended on March 31, 1996, heretofore
furnished to each of the Banks, present in all material respects the financial
condition of such Insurance Subsidiary as at said dates and its results of
operations for its fiscal year and three-month period ended on said dates, in
each case, in accordance with statutory reporting practices prescribed or
permitted by its Applicable Insurance Regulatory Authority for the preparation
of financial statements and other financial reports by insurance corporations of
the type of such Insurance Subsidiary.
7.03 Litigation. There are no legal or arbitral proceedings, or
-----------
any proceedings by or before any governmental or regulatory authority or agency,
now pending or (to the knowledge of the Company) threatened against the Company
or any of its Subsidiaries in which there is a reasonable possibility of an
adverse determination or contingent liability not reflected on the Company's
financial statements referred to in Section 7.02 hereof that could have a
Material Adverse Effect.
7.04 No Breach. None of the execution and delivery of this
----------
Agreement, the Notes and the Purchase Agreement, the consummation of the
transactions herein and therein contemplated, including the Acquisition, or
compliance with the terms and provisions hereof and thereof will conflict with
or result in a breach of, or require any consent under, the charter or by-laws
of the Company, or any applicable law or regulation, or any order, writ,
injunction or decree of any court or governmental authority or agency, or any
agreement or instrument to which the Company or any of its Subsidiaries is a
party or by which any of them or any of their Property is bound or to which any
of them is subject, or constitute a default under any such agreement or
instrument, or result in the creation or imposition of any Lien upon any
Property of the Company or any of its Subsidiaries pursuant to the terms of any
such agreement or instrument.
7.05 Action. The Company has all necessary corporate power,
-------
authority and legal right to execute, deliver and perform its obligations under
each of the Basic Documents and the Purchase Agreement; the execution, delivery
and performance by the Company of each of the Basic Documents and the Purchase
Agreement have been duly authorized by all necessary corporate action on its
part (including, without limitation, any required shareholder approvals); and
this Agreement has been duly and validly executed and delivered by the Company
and constitutes, and each of the Notes, the other Basic Documents and the
Purchase Agreement when executed and delivered by the Company (in the case of
the Notes, for value) will constitute, its legal, valid and binding obligation,
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement of
creditors' rights and (b) the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
7.06 Approvals. No authorizations, approvals or consents of, and no
----------
filings or registrations with, any governmental or regulatory authority or
agency, or any securities exchange, are necessary for the execution, delivery or
performance by the Company of (x) the Basic Documents or for the legality,
validity or enforceability hereof or thereof or (y) except as specified in
Section 6.02(f) hereof, the Purchase Agreement, and, as at the Acquisition Date,
each of such authorizations, approvals, consents, filings and registrations
referred to in said Section 6.02(f) will be in full force and effect and will
not have been not withdrawn or modified.
7.07 Use of Credit. Neither the Company nor any of its Subsidiaries
--------------
is engaged principally, or as one of its important activities, in the business
of extending credit for the purpose, whether immediate, incidental or ultimate,
of buying or carrying Margin Stock, and no part of the proceeds of any Loan
hereunder will be used to buy or carry any Margin Stock. Not more than 10% of
the value of the Properties of the Company and its Consolidated Subsidiaries
(determined on a consolidated basis) is attributable to Margin Stock.
7.08 ERISA. The Company and the ERISA Affiliates have fulfilled
------
their respective obligations under the minimum funding standards of ERISA and
the Code with respect to each Plan and are in compliance in all material
respects with the presently applicable provisions of ERISA and the Code, and
have not incurred any liability to the PBGC or any Plan or Multiemployer Plan
(other than to make contributions in the ordinary course of business).
7.09 Taxes. United States Federal income tax returns of the Company
------
and its Subsidiaries have been examined and closed to further assessment through
the fiscal year of the Company ended December 31, 1985. The Company 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 Company or any of its Subsidiaries. The charges, accruals and reserves on
the books of the Company and its Subsidiaries in respect of taxes and other
governmental charges are, in the opinion of the Company, adequate.
7.10 Investment Company Act. Except for those Subsidiaries
-----------------------
specified on Schedule III hereto, neither the Company nor any of its
Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
7.11 Public Utility Holding Company Act. Neither the Company nor
-----------------------------------
any of its Subsidiaries is a "holding company", or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
7.12 Credit Agreements. Schedule I hereto is a complete and correct
------------------
list, as of the date of this Agreement, of each credit agreement, loan
agreement, indenture, purchase agreement, Guarantee or other arrangement
providing for or otherwise relating to any Indebtedness or any extension of
credit (or commitment for any extension of credit) to, or Guarantee by, the
Company or any of its Consolidated Subsidiaries the aggregate principal or face
amount of which equals or exceeds (or may equal or exceed) $1,000,000 and the
aggregate principal or face amount outstanding or which may become outstanding
under each such arrangement is correctly described in said Schedule I.
7.13 Hazardous Materials. The Company and each of its Subsidiaries
--------------------
have obtained all permits, licenses and other authorizations which are required
under all Environmental Laws, except to the extent failure to have any such
permit, license or authorization would not have a Material Adverse Effect. The
Company and each of its Subsidiaries are in compliance with the terms and
conditions of all such permits, licenses and authorizations, and are also in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
any applicable Environmental Law or in any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder, except to the extent failure to comply would
not have a Material Adverse Effect.
7.14 Subsidiaries, Etc. Set forth in Schedule II hereto is a
-------------------
complete and correct list, as of the date of this Agreement, of all Subsidiaries
of the Company (and the respective jurisdiction of organization of each such
Subsidiary) and of all Investments held by the Company or any of its
Subsidiaries in any joint venture. Except as disclosed in Schedule II hereto
the Company owns, free and clear of Liens, all outstanding shares of such
Subsidiaries (and each such Subsidiary owns, free and clear of Liens, all
outstanding equity interests of its Subsidiaries) and all such shares are
validly issued, fully paid and non-assessable and the Company (or the respective
Subsidiary) also owns, free and clear of Liens, all such Investments.
7.15 True and Complete Disclosure. The information, reports,
-----------------------------
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Company to the Administrative Agent or any Bank in connection with
the negotiation, preparation or delivery of this Agreement and the other Basic
Documents or included herein or therein or delivered pursuant hereto or thereto,
when taken as a whole do not contain any untrue statement of material fact or
omit to state any material fact necessary to make the statements herein or
therein, in light of the circumstances under which they were made, not
misleading. All written information furnished after the date hereof by the
Company and its Subsidiaries to the Administrative Agent and the Banks in
connection with this Agreement and the other Basic Documents and the
transactions contemplated hereby and thereby will be true, complete and accurate
in every material respect, or (in the case of projections) based on reasonable
estimates, on the date as of which such information is stated or certified.
There is no fact known to the Company that could have a Material Adverse Effect
that has not been disclosed herein, in the other Basic Documents or in a report,
financial statement, exhibit, schedule, disclosure letter or other writing
furnished to the Banks for use in connection with the transactions contemplated
hereby or thereby.
7.16 Capitalization. As of the Closing Date, the authorized capital
---------------
stock of the Company consists of (i) 65,000,000 shares of common stock, par
value $1.00 per share, of which approximately 45,544,430 shares are duly and
validly issued and outstanding and (ii) 25,000,000 shares of preferred stock,
par value $1.00 per share, of which 1,041,534 shares of 8.10% cumulative
preferred stock, liquidation value of $150 per share, are duly and validly
issued and outstanding, each of which issued and outstanding shares are fully
paid and nonassessable. On the Acquisition Date, the authorized capital stock
of the Company will consist of (i) 150,000,000 shares of common stock, par value
$1.00 per share and (ii) 25,000,000 shares of preferred stock, par value $1.00
per share. In connection with the Zurich Investment, the Company will issue
9,523,810 shares of common stock of the Company. In connection with the
Acquisition, the Company will issue no less than 6,644,518 nor more than
14,414,414 shares of common stock of the Company, each of which will be fully
paid and nonassessable. As of the Acquisition Date, (x) except for employee
benefit and salary plans, there will be no outstanding Equity Rights with
respect to the Company and (y) except for employee benefit and salary plans,
there will be no outstanding obligations of the Company or any of its
Subsidiaries to repurchase, redeem, or otherwise acquire any shares of capital
stock of the Company nor will there be any outstanding obligations of the
Company or any of its Subsidiaries to make payments to any Person, such as
"phantom stock" payments, where the amount thereof is calculated with reference
to the fair market value or equity value of the Company or any of its
Subsidiaries.
7.17 Purchase Agreement. The Company has delivered to the
-------------------
Administrative Agent true and complete copies of the Purchase Agreement
(including all schedules and exhibits thereto).
Section 8. Covenants of the Company. The Company covenants and
------------------------
agrees with the Banks and the Administrative Agent that, so long as any
Commitment or Loan is outstanding and until payment in full of all amounts
payable by the Company hereunder:
8.01 Financial Statements. The Company shall deliver to each of the
---------------------
Banks:
(a) as soon as available and in any event within 45 days after the
end of each quarterly fiscal period ending March 31, June 30 and September
30 of each fiscal year of the Company, consolidated statements of
operations and cash flow of the Company and its Consolidated Subsidiaries
for such period and for the period from the beginning of the respective
fiscal year to the end of such period, setting forth in each case in
comparative form the corresponding consolidated figures for the
corresponding period in the preceding fiscal year, and the related
consolidated statements of financial condition as at the end of such period
and as at the previous year end, accompanied by a certificate of a senior
financial officer of the Company, which certificate shall state that said
financial statements fairly present in all material respects the
consolidated financial position and results of operations and cash flows of
the Company and its Consolidated Subsidiaries, in accordance with generally
accepted accounting principles, consistently applied, as at the end of, and
for, such period (subject to normal year-end audit adjustments);
(b) as soon as available and in any event within 90 days after the end
of each fiscal year of the Company, consolidated statements of operations,
stockholders' equity and cash flow of the Company and its Consolidated
Subsidiaries for such year and, in the case of the Company only,
unconsolidated statements of operations and cash flows for such year and
the related consolidated and unconsolidated statements of financial
condition as at the end of such year, setting forth in each case in
comparative form the corresponding consolidated and unconsolidated figures
for the preceding fiscal year, and accompanied (i) in the case of said
consolidated statements and statements of financial condition, by an
unqualified opinion thereon of independent certified public accountants of
recognized national standing, which opinion shall state that said
consolidated financial statements fairly present in all material respects
the consolidated financial position and results of operations and cash
flows of the Company and its Consolidated Subsidiaries as at the end of,
and for, such fiscal year in conformity with generally accepted accounting
principles, and a certificate of such accountants stating that, in making
the examination necessary for their opinion, they obtained no knowledge,
except as specifically stated, of any Default arising from the breach of
any of Sections 8.07 through 8.13 hereof (inclusive), and (ii) in the case
of said unconsolidated statements and statement of financial condition, by
a certificate of a senior financial officer of the Company, which
certificate shall state that said unconsolidated financial statements
fairly present in all material respects the unconsolidated financial
position and results of operations and cash flows of the Company in
conformity with generally accepted accounting principles, consistently
applied, as at the end of, and for, such fiscal year;
(c) as soon as available and in any event not later than 60 days
after the end of each fiscal year of each Insurance Subsidiary, (i) the
Annual Statements of such Insurance Subsidiary (prepared in accordance with
the statutory accounting practices required or permitted by its Applicable
Insurance Regulatory Authority) for such fiscal year as filed with such
Applicable Insurance Regulatory Authority, together with the opinion
thereon of a senior financial officer of such Insurance Subsidiary stating
that such Annual Statements present the statutory financial condition of
such Insurance Subsidiary in accordance with statutory accounting practices
required or permitted by such Applicable Insurance Regulatory Authority and
(ii) an opinion of the appointed actuary of such Insurance Subsidiary or
independent certified public accountants of recognized national standing
affirming the adequacy of the insurance reserves of such Insurance
Subsidiary; in addition, no later than April 1 following the end of each
fiscal year of each Insurance Subsidiary, the management's discussion and
analysis relating to the Annual Statements of such Insurance Subsidiary for
such fiscal year;
(d) as soon as available and in any event not later than the May 1
following the end of each fiscal year of the Company, the Consolidated
Annual Statement of the Company's Insurance Subsidiaries (prepared in
accordance with the statutory accounting practices required or permitted by
the Applicable Insurance Regulatory Authority for the Company) for such
fiscal year as filed with such Applicable Insurance Regulatory Authority,
together with the opinion thereon of a senior financial officer of the
Company stating that such Annual Statement of the Company's Insurance
Subsidiaries was prepared in accordance with statutory accounting practices
required or permitted by such Applicable Insurance Regulatory Authority;
(e) as soon as available and in any event within 45 days after the
end of each fiscal quarter ending March 31, June 30 and September 30 of
each Insurance Subsidiary, quarterly statutory financial statements of such
Insurance Subsidiary (prepared in accordance with statutory accounting
practices required or permitted by its Applicable Insurance Regulatory
Authority) for such fiscal quarter as filed with such Applicable Insurance
Regulatory Authority, together with the opinion thereon of a senior
financial officer of such Insurance Subsidiary stating that such statutory
financial statements present the statutory financial condition of such
Insurance Subsidiary in accordance with statutory accounting practices
required or permitted by such Applicable Insurance Regulatory Authority;
(f) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any, that the
Company shall have filed with the Securities and Exchange Commission (or
any governmental agency substituted therefor) or any national securities
exchange;
(g) promptly upon the mailing thereof to the shareholders of the
Company generally, copies of all financial statements, reports and proxy
statements so mailed;
(h) as soon as possible, and in any event within ten days after the
Company knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan has occurred
or exists, a statement signed by a senior financial officer of the Company
setting forth details respecting such event or condition and the action, if
any, that the Company or its ERISA Affiliate proposes to take with respect
thereto (and a copy of any report or notice required to be filed with or
given to the PBGC by the Company or an ERISA Affiliate with respect to such
event or condition):
(i) any reportable event, as defined in Section 4043(b) of ERISA
and the regulations issued thereunder, with respect to a Plan, other
than (x) any reportable event for which the PBGC has by regulation
waived the requirement of Section 4043(a) of ERISA that it be notified
within 30 days of the occurrence of such event (provided that a
--------
failure to meet the minimum funding standard of Section 412 of the
Code or Section 302 of ERISA, including, without limitation, the
failure to make on or before its due date a required installment under
Section 412(m) of the Code or Section 302(e) of ERISA, shall be a
reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code) or (y) a reportable event
for which notice to the PBGC is waived or penalties have been waived
under PBGC Technical Update 95-3;
(ii) the filing under Section 4041 of ERISA of a notice of intent
to terminate any Plan or any action taken by the Company or an ERISA
Affiliate to terminate any Plan that would result in a liability to
the Company;
(iii) the institution by the PBGC of proceedings under Section
4042 of ERISA for the termination of, or the appointment of a trustee
to administer, any Plan, or the receipt by the Company or any ERISA
Affiliate of a notice from a Multiemployer Plan that such action has
been taken by the PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal by the Company or any
ERISA Affiliate from a Multiemployer Plan that results in liability
under Section 4201 or 4204 of ERISA (including the obligation to
satisfy secondary liability as a result of a purchaser default) or the
receipt by the Company or any ERISA Affiliate of notice from a
Multiemployer Plan that it is in reorganization or insolvency pursuant
to Section 4241 or 4245 of ERISA or that it intends to terminate or
has terminated under Section 4041A of ERISA; and
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against the Company or any ERISA Affiliate to
enforce Section 515 of ERISA, which proceeding is not dismissed within
30 days;
(i) promptly after the Company knows or has reason to believe that
any Default has occurred, a notice of such Default (and stating that such
notice is a "Notice of Default") describing the same in reasonable detail
and, together with such notice or as soon thereafter as possible, a
description of the action that the Company has taken or proposes to take
with respect thereto;
(j) from time to time such other information regarding the financial
condition, operations, business or prospects of the Company or any of its
Subsidiaries (including, without limitation, any Plan or Multiemployer Plan
and any reports or other information required to be filed under ERISA) as
any Bank or the Administrative Agent may reasonably request; and
(k) notice of any change in the Moody's Rating, Moody's Claims
Rating, S&P Rating, S&P Claims Rating or any Insurance Subsidiary's A.M.
Best rating promptly after the same shall have occurred.
The Company will furnish to the Administrative Agent on behalf of each Bank, at
the time it furnishes each set of financial statements pursuant to Section
8.01(a), (b), (d) or (e) hereof, a certificate of a senior financial officer of
the Company (i) to the effect that no Default has occurred and is continuing
(or, if any Default has occurred and is continuing, describing the same in
reasonable detail and describing the action that the Company has taken or
proposes to take with respect thereto) and (ii) setting forth in reasonable
detail the computations necessary to determine whether the Company is in
compliance with Sections 8.07 through 8.13 hereof (inclusive) as of the end of
the respective quarterly fiscal period or fiscal year.
8.02 Litigation. The Company will promptly give to each Bank notice
-----------
of all legal or arbitral proceedings, and of all proceedings by or before any
governmental or regulatory authority or agency, and any material development in
respect of such legal or other proceedings, affecting the Company or any of its
Subsidiaries, except proceedings in which there is no reasonable possibility of
an adverse determination that could have a Material Adverse Effect.
8.03 Existence, Etc. The Company will, and will cause each of its
----------------
Subsidiaries to:
(a) preserve and maintain its legal existence and all of its material
rights, privileges, licenses and franchises (provided that nothing in this
--------
Section 8.03 shall prohibit any transaction expressly permitted under
Section 8.05 hereof);
(b) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if failure
to comply with such requirements could (either individually or in the
aggregate) have a Material Adverse Effect;
(c) pay and discharge all taxes, assessments and governmental charges
or levies imposed on it or on its income or profits or on any of its
Property prior to the date on which penalties attach thereto, except for
any such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which
adequate reserves are being maintained;
(d) maintain all of its Properties used or useful in its business in
good working order and condition, ordinary wear and tear excepted; and
(e) permit representatives of any Bank or the Administrative Agent,
during normal business hours, to examine, copy and make extracts from its
books and records, to inspect any of its Properties, and to discuss its
business and affairs with its officers, all to the extent reasonably
requested by such Bank or the Administrative Agent (as the case may be).
8.04 Insurance. The Company shall, and shall cause each of its
----------
Subsidiaries to, maintain worker's compensation insurance, liability insurance
and insurance on its properties, assets and business, now owned or hereafter
acquired, against such casualties, risks and contingencies, and in such types
and amounts, as are consistent with customary practices and standards of
companies engaged in similar businesses. Except in respect of errors and
omissions policies, the Company shall not permit the types or amounts of self-
insurance maintained by it and its Subsidiaries to be materially increased
beyond the types and amounts thereof set forth in the certificate referred to in
Section 6.01(h) hereof.
8.05 Limitation of Fundamental Changes. The Company will not, nor
----------------------------------
will it permit any of its Subsidiaries to, enter into any transaction of merger
or consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution). Except for the Acquisition, the Company
will not, and will not permit any of its Subsidiaries to, acquire any business
or assets from, or capital stock of, or be a party to any acquisition of, any
Person (each, a "Corporate Acquisition") except for purchases of inventory and
---------------------
other assets to be sold or used in the ordinary course of business and
Investments permitted under Section 8.08 hereof. The Company will not, and will
not permit any of its Subsidiaries to, convey, sell, lease, transfer or
otherwise dispose of, in one transaction or a series of transactions, all or a
Substantial Part of its business or assets, whether now owned or hereafter
acquired (including, without limitation, shares of stock and indebtedness of
Subsidiaries, receivables and leasehold interests); and any conveyance, sale,
lease, transfer or other disposition not prohibited by this sentence shall be on
an arm-length basis. Notwithstanding the foregoing provisions of this Section
8.05: (a) the Subsidiaries of the Company may enter into reinsurance
transactions in respect of individual disability policies in the ordinary course
of business if both the liability in respect of such policies and their
associated assets are transferred pursuant to such reinsurance policies on an
arms-length basis and (b) if no Default exists or would result therefrom
(including, without limitation, in respect of Section 8.14 hereof):
(i) the Company may be merged or consolidated with or into any other
Person so long as the Company is the surviving corporation;
(ii) any Subsidiary of the Company may be merged or consolidated with
or into: (x) the Company if the Company shall be the continuing or
surviving corporation or (y) any other such Subsidiary; provided that if
any such transaction shall be between a Subsidiary and a Wholly-Owned
Subsidiary, the Wholly-Owned Subsidiary shall be the continuing or
surviving corporation;
(iii) any such Subsidiary may sell, lease, transfer or otherwise
dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to the Company or a Wholly-Owned Subsidiary of the Company;
(iv) any Subsidiary of the Company may change its domicile from one
state in the United States of America to another state in the United States
of America;
(v) the Company or any Subsidiary may (x) convey, sell, lease,
transfer or otherwise dispose of any Investments in connection with a bulk
sale thereof if the proceeds of such disposition are reinvested by the
Company or such Subsidiary in Investments of the same or higher investment
quality or (y) sell, transfer or otherwise dispose of any Subsidiary that
is an insurance company, the assets (or substantially all of the assets) of
which have been disposed of pursuant to clause (iii) above;
(vi) the Company or any Subsidiary may effect a Corporate Acquisition
unless effecting the same would have Material Adverse Effect; and
(vii) the Company or any Subsidiary may convey, sell, transfer or
otherwise dispose of all or any portion of their respective group pension
business so long as any such disposition is to a non-Affiliate of the
Company, is effected on an arms length basis and no special Dividend
Payment is declared or made with (or related to) the proceeds thereof.
8.06 Certain Obligations Respecting Subsidiaries. Subject to the
--------------------------------------------
provisions of Section 8.05 hereof, the Company will, and will cause each of its
Subsidiaries to, take such action from time to time as shall be necessary to
ensure that it at all times owns at least the same percentage of the issued and
outstanding shares of each class of stock of each of its Subsidiaries as is
owned on the date of the initial Loans hereunder. Without limiting the
generality of the foregoing, the Company will not, nor will it permit any of its
Subsidiaries to, sell, transfer or otherwise dispose of any shares of stock in
any Subsidiary owned by them (except for a sale, transfer or other disposition
permitted under Section 8.05 hereof) and the Company will not, nor will it
permit any of its Subsidiaries to, issue any shares of stock of any class
whatsoever to any Person (except directors' qualifying shares).
8.07 Limitation on Liens. (a) The Company will not, nor will it
--------------------
permit any of its Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon any of its Property, whether now owned or hereafter acquired, except
(subject to paragraph (b) of this Section 8.07):
(i) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or which are being contested in good
faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Company or any of its
Subsidiaries, as the case may be, in accordance with GAAP;
(ii) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business
which are not overdue for a period of more than 30 days or which are being
contested in good faith and by appropriate proceedings and Liens securing
judgments but only to the extent, for an amount and for a period not
resulting in an Event of Default under Section 9(h) hereof;
(iii) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(iv) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations (including
those in respect of insurance company qualification requirements), surety
and appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(v) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the
use of Property or minor imperfections in title thereto which, in the
aggregate, are not material in amount, and which do not in any case
materially detract from the value of the Property subject thereto or
interfere with the ordinary conduct of the business of the Company or any
of its Subsidiaries;
(vi) Liens upon personal Property securing obligations arising out of
Derivatives Obligations entered into solely for hedging purposes;
(vii) Liens on (A) marketable direct obligations issued or
unconditionally guaranteed or insured by the United States of America or
any agency or instrumentality thereof and backed by the full faith and
credit of the United States of America sold by the Company or any of its
Subsidiaries under a repurchase agreement with a bank or a primary dealer
of United States government securities (a "Repo Counterparty ") maturing
-----------------
within 30 days from the date of sale, provided that the terms of such
agreement comply with the guidelines set forth in the Federal Financial
Institutions Examination Council Supervisory Policy -- Repurchase
Agreements of Depositary Institutions With Securities Dealers and Others,
as adopted by the Comptroller of the Currency on October 31, 1985 (or any
successor guidelines) and (B) other marketable debt securities under a
repurchase agreement and/or securities lending agreement with a bank or a
primary dealer of such securities (the "Counterparty") maturing within 30
------------
days from the date of sale if the terms of such agreement comply with such
guidelines; provided that, in the case of any mortgage-backed security
subject to such an arrangement, the Counterparty thereof may, in lieu of
returning such security, return another mortgage-backed security of the
same value, yield and rating, and otherwise having comparable economic
terms; provided further that the Company and its Subsidiaries will continue
their policies in effect on the date hereof requiring collateral from their
Repo Counterparties and Counterparties;
(viii) Liens on (x) Property acquired or (y) Property of any Person
which is subject to a Corporate Acquisition, in each case, after the date
of this Agreement, provided that such Liens are in existence at the time
such acquisition and were not created in anticipation thereof; provided
further, the aggregate Indebtedness secured thereby shall not exceed
$25,000,000 in the aggregate at any one time outstanding;
(ix) additional Liens upon real and/or personal Property, provided
that, the aggregate Indebtedness secured thereby shall not exceed
$25,000,000 in the aggregate at any one time outstanding; and
(x) any extension, renewal or replacement of the foregoing, provided,
however, that the Liens permitted hereunder shall not be spread to cover
any additional Indebtedness or Property (other than a substitution of like
Property).
(b) Notwithstanding subparagraphs (a)(i) through (a)(x) of this
Section 8.07, the Company will not, nor will it permit any of its Subsidiaries
to, create, incur, assume or suffer to exist any Lien upon any stock issued by
any Insurance Subsidiary.
8.08 Investments. The Company will not permit to remain
------------
outstanding:
(a) any Investments that consist of capital stock, partnership or
other ownership interests or other equity securities in any Person (other
than a Subsidiary or Affiliate of the Company) in an aggregate amount (for
all such Investments) in excess of 10% of the total investments of the
Company and its Subsidiaries (determined on consolidated basis in
accordance with GAAP, but excluding the value of any investments of the
Company in any of its Subsidiaries or Affiliates);
(b) any Investments that are Non-Investment Grade Investments (as
defined below) in an aggregate amount (for all such Investments) in excess
of 10% of the total investments of the Company and its Subsidiaries
(determined on a consolidated basis in accordance with GAAP, but excluding
the value of any investments of the Company in any of its Subsidiaries or
Affiliates); and
(c) any Investments that consist of real estate (excluding Company
occupied properties) and mortgage loans in an aggregate amount (for all
such Investments) in excess of 10% of the total investments of the Company
and its Subsidiaries (determined on a consolidated basis in accordance with
GAAP, but excluding the value of any investments of the Company in any of
its Subsidiaries or Affiliates);
provided that the Company may, and may permit its Subsidiaries to, make and
maintain Investments in Wholly-Owned Subsidiaries of the Company. For purposes
of this Section 8.08, "Non-Investment Grade Investments" shall mean bonds,
--------------------------------
debentures, notes or other evidence of, or other obligations to repay,
Indebtedness bearing interest at a fixed rate that (i) have been designated by
the Securities Valuation Office of the NAIC as having a lower quality than '2'
or (ii) do not have a quality designation by said Securities Valuation Office
(except in the case of any such Indebtedness that does not have such rating due
to its being newly issued (and such failure to have a rating does not exceed 60
days) and if the Company reasonably believes that such Indebtedness would have
an NAIC Rating of at least 2).
8.09 Dividend Payments. The Company will not declare or make any
------------------
Dividend Payment at any time; provided, however, that the Company may declare
and make Dividend Payments in cash, subject to the satisfaction of the following
condition on the date of such Dividend Payment and after giving effect thereto:
the aggregate amount of Dividend Payments made in the then current fiscal year
of Company, including the amount of such Dividend Payment, shall not exceed (i)
in the case of the Company's common stock, (x) through December 31, 1997, $0.85
per share and (y) thereafter, $1 per share (provided that any increase in the
number of outstanding common stock shares of the Company resulting from (x) a
stock split or stock dividend of such shares or (y) the issuance of such shares
where the proceeds thereof are utilized to make (or are related to the making
of) a special Dividend Payment, shall result in a commensurate proportional
decrease in the allowable per share common stock Dividend Payment) and (ii) in
the case of the Company's outstanding (as at the date hereof) 8.10% cumulative
preferred stock, $13,000,000; provided further, that if the Applicable Margin is
at any time during any year computed by reference to category (e) in the
definition thereof, the aggregate amount of Dividend Payments made in the then
current fiscal year of the Company shall not exceed 30% of the statutory net
income of the Insurance Subsidiaries on a combined basis determined in
accordance with SAP for the most recently ended fiscal year of the Company.
8.10 Minimum Adjusted Statutory Surplus. The Company will not
-----------------------------------
permit at any time the combined Adjusted Statutory Surplus for all of its
directly owned Insurance Subsidiaries to be less than (I) prior to the
Acquisition, $600,000,000 and (II) from and after the Acquisition, (i) through
December 30, 1998, $875,000,000 and (ii) thereafter, $925,000,000.
8.11 Consolidated Funded Debt Ratio. The Company will not permit at
-------------------------------
any time Consolidated Funded Debt to exceed 35.00% of the Consolidated Capital.
8.12 Ratio of Cash Sources to Cash Uses. The Company will maintain
-----------------------------------
a ratio of Cash Sources to Cash Uses in excess of 1.5 to 1.
8.13 Authorized Control Level Risk Based Capital Ratio. The Company
--------------------------------------------------
will not as at the last day of any fiscal quarter permit PLAIC's or, from and
after the Acquisition, Paul Revere Life Insurance Company's Total Adjusted
Capital (as defined in the NAIC's Risk-Based Capital for life and/or Health
Insurers Model Act (as then currently in effect), as so adopted (and including
any instructions thereunder, the "Model Act") to be less than (x) through
---------
December 30, 1998, 300% and (y) thereafter, 350% of its Authorized Control Level
RBC (as defined in the Model Act).
8.14 Lines of Business. The Company will continue, and cause each
------------------
of its Consolidated Subsidiaries to continue, to engage in a business of the
same general type as conducted by it on the date of this Agreement.
8.15 Transactions with Affiliates. Except as expressly permitted by
-----------------------------
this Agreement, the Company will not, nor will it permit any of its Subsidiaries
to, directly or indirectly: (a) make any Investment in an Affiliate; (b)
transfer, sell, lease, assign or otherwise dispose of any Property to an
Affiliate; (c) merge into or consolidate with or purchase or acquire Property
from an Affiliate; or (d) enter into any other transaction directly or
indirectly with or for the benefit of an Affiliate (including, without
limitation, guarantees and assumptions of obligations of an Affiliate); provided
that (x) any Affiliate who is an individual may serve as a director, officer or
employee of the Company or any of its Subsidiaries and receive reasonable
compensation for his or her services in such capacity and (y) the Company and
its Subsidiaries may enter into transactions (other than extensions of credit by
the Company or any of its Subsidiaries to an Affiliate) providing for the
leasing of Property, the rendering or receipt of services or the purchase or
sale of inventory and other Property in the ordinary course of business (which
may include the purchase of related businesses) if the monetary or business
consideration arising therefrom would be substantially as advantageous to the
Company and its Subsidiaries as the monetary or business consideration which
would obtain in a comparable transaction with a Person not an Affiliate.
8.16 Use of Proceeds. The Company will use the proceeds of the
----------------
Loans hereunder solely (i) to pay a portion of the purchase price for the
Acquisition, (ii) to pay the principal of the Refinanced Debt, (iii) to pay
certain of the fees, commissions and expenses payable in connection with the
foregoing and (iv) for general corporate purposes (including the repurchase by
the Company of any of its outstanding preferred stock); provided that (i) none
of the proceeds shall be paid over to, or used to fund the operations of, any
Subsidiary referred to in Schedule III hereto and (ii) neither the
Administrative Agent nor any Bank shall have any responsibility as to the use of
any of such proceeds.
8.17 Pari Passu. The Company will not permit any of its
-----------
Indebtedness to creditors not constituting its Subsidiaries to be guaranteed or
otherwise supported by, or to have direct access to any assets of, any of its
Subsidiaries.
Section 9. Events of Default. If one or more of the following events
-----------------
(herein called "Events of Default") shall occur and be continuing:
-----------------
(a) The Company shall default in the payment when due of (i) any
principal of or interest on any Loan, or (ii) any fee or any other amount
payable by it hereunder or under any Note and such default in respect of
any such fee or other amount shall have continued unremedied for more than
three Business Days; or
(b) The Company or any of its Consolidated Subsidiaries shall default
in the payment when due of any amount of principal of any of its other
Indebtedness the aggregate amount of which other Indebtedness is
$10,000,000 or more or shall default in the payment when due of any
interest on any such Indebtedness or on any amount payable under any
Derivatives Obligation and such default in the payment of interest or
amount shall remain unremedied for three or more Business Days; or any
event specified in any note, agreement, indenture or other document
evidencing or relating to any such Indebtedness or any Derivatives
Obligation shall occur if the effect of such event is to cause, or (with
the giving of any notice or the lapse of time or both) to permit the holder
or holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause, such Indebtedness to become due, or to be
prepaid in full (whether by redemption, purchase, offer to purchase or
otherwise), prior to its stated maturity or to have the interest rate
thereon reset to a level so that securities evidencing such Indebtedness
trade at level specified in relation to the par value thereof or, in the
case of an Derivatives Obligations, to permit the payments owing under such
Derivatives Obligations to be liquidated; or
(c) Any representation, warranty or certification made or deemed made
herein or in any other Basic Document (or in any modification or supplement
hereto or thereto) by the Company, or any certificate furnished to any Bank
or the Administrative Agent pursuant to the provisions hereof or thereof,
shall prove to have been false or misleading as of the time made or
furnished in any material respect; or
(d) The Company shall default in the performance of any of its
obligations under any of Sections 8.01(i), 8.05 through 8.13 (inclusive),
8.16 and 8.17 hereof; or the Company shall default in the performance of
any of its other obligations in this Agreement or any other Basic Document
and such default shall continue unremedied for a period of 30 days after
notice thereof to the Company by the Administrative Agent or any Bank
(through the Administrative Agent); or
(e) The Company or any of its Subsidiaries shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts become
due; or
(f) The Company or any of its Subsidiaries shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee, examiner or liquidator of itself or of all or a
substantial part of its Property, (ii) make a general assignment for the
benefit of its creditors, (iii) commence a voluntary case under the
Bankruptcy Code, (iv) file a petition seeking to take advantage of any
other law relating to bankruptcy, insolvency, reorganization,
rehabilitation, supervision, conservatorship, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts, (v)
fail to controvert in a timely and appropriate manner, or acquiesce in
writing to, any petition filed against it in an involuntary case under the
Bankruptcy Code or (vi) take any corporate action for the purpose of
effecting any of the foregoing; or
(g) A proceeding, order or case shall be commenced, without the
application or consent of the Company or any of its Subsidiaries, in any
court of competent jurisdiction, or by any applicable insurance regulatory
authority seeking (i) its reorganization, rehabilitation, supervision,
conservatorship, liquidation, dissolution, arrangement or winding-up, or
the composition or readjustment of its debts, (ii) the appointment of a
receiver, custodian, trustee, examiner, liquidator or the like of the
Company or such Subsidiary or of all or any substantial part of its
Property, or (iii) similar relief in respect of the Company or such
Subsidiary under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and such
proceeding or case shall continue undismissed, or an order, judgment or
decree approving or ordering any of the foregoing shall be entered and
continue unstayed and in effect, for a period of 60 or more days; or an
order for relief against the Company or such Subsidiary shall be entered in
an involuntary case under the Bankruptcy Code; or
(h) A final judgment or judgments for the payment of money in excess
of $10,000,000 in the aggregate (exclusive of judgment amounts fully
covered by insurance where the insurer has admitted liability in writing in
respect of such judgment) shall be rendered by one or more courts,
administrative tribunals or other bodies having jurisdiction against the
Company or any of its Subsidiaries and the same shall not be discharged (or
provision shall not be made for such discharge), or a stay of execution
thereof shall not be procured, within 30 days from the date of entry
thereof and the Company or the relevant Subsidiary shall not, within said
period of 30 days, or such longer period during which execution of the same
shall have been stayed, appeal therefrom and cause the execution thereof to
be stayed during such appeal; or
(i) An event or condition specified in Section 8.01(h) hereof shall
occur or exist with respect to any Plan or Multiemployer Plan and, as a
result of such event or condition, together with all other such events or
conditions, the Company or any ERISA Affiliate shall incur or in the
opinion of the Majority Banks shall be reasonably likely to incur a
liability to a Plan, a Multiemployer Plan or the PBGC (or any combination
of the foregoing) that, in the determination of the Majority Banks, would
(either individually or in the aggregate) have a Material Adverse Effect;
or
(j) except as expressly permitted by Section 8.05 hereof: (i) any
Person (other than Zurich Insurance Company) or two or more Persons acting
in concert shall have acquired beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 30% or more of the outstanding shares of voting
stock of the Company; or (ii) during any period of 25 consecutive calendar
months, individuals who were directors of the Company on the first day of
such period shall no longer constitute a majority of the board of directors
(excluding any directors that replaced individuals who ceased to be
directors during such period by reason of death or retirement (voluntary or
mandatory) and any directors who were appointed or whose election was
approved by a majority of the board of directors holding office at the time
of such election) of the Company;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (e), (f) or (g) of this Section 9 with respect to the Company, the
Administrative Agent may and, upon request of the Majority Banks will, by notice
to the Company, terminate the Commitments and/or declare the principal amount
then outstanding of, and the accrued interest on, the Loans and all other
amounts payable by the Company hereunder and under the Notes (including, without
limitation, any amounts payable under Section 5.05 hereof) to be forthwith due
and payable, whereupon such amounts shall be immediately due and payable without
presentment, demand, protest or other formalities of any kind, all of which are
hereby expressly waived by the Company; and (2) in the case of the occurrence of
an Event of Default referred to in clause (e), (f) or (g) of this Section 9 with
respect to the Company, the Commitments shall automatically be terminated and
the principal amount then outstanding of, and the accrued interest on, the Loans
and all other amounts payable by the Company hereunder and under the Notes
(including, without limitation, any amounts payable under Section 5.05 hereof)
shall automatically become immediately due and payable without presentment,
demand, protest or other formalities of any kind, all of which are hereby
expressly waived by the Company.
Section 10. The Administrative Agent.
------------------------
10.01 Appointment, Powers and Immunities. Each Bank hereby
-----------------------------------
irrevocably appoints and authorizes the Administrative Agent to act as its agent
hereunder and under the other Basic Documents with such powers as are
specifically delegated to the Administrative Agent by the terms of this
Agreement and of the other Basic Documents, together with such other powers as
are reasonably incidental thereto. The Administrative Agent (which term as used
in this sentence and in Section 10.05 hereof and the first sentence of Section
10.06 hereof shall include reference to its affiliates and its own and its
affiliates' officers, directors, employees and agents): (a) shall have no
duties or responsibilities except those expressly set forth in this Agreement
and in the other Basic Documents, and shall not by reason of this Agreement or
any other Basic Document be a trustee for any Bank; (b) shall not be responsible
to the Banks for any recitals, statements, representations or warranties
contained in this Agreement or in any other Basic Document, or in any
certificate or other document referred to or provided for in, or received by any
of them under, this Agreement or any other Basic Document, or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement, any Note or any other Basic Document or any other document referred
to or provided for herein or therein or for any failure by the Company or any
other Person to perform any of its obligations hereunder or thereunder; (c)
shall not be required to initiate or conduct any litigation or collection
proceedings hereunder or under any other Basic Document; and (d) shall not be
responsible for any action taken or omitted to be taken by it hereunder or under
any other Basic Document or under any other document or instrument referred to
or provided for herein or therein or in connection herewith or therewith, except
for its own gross negligence or willful misconduct. The Administrative Agent
may deem and treat the payee of any Note as the holder thereof for all purposes
hereof unless and until a notice of the assignment or transfer thereof shall
have been filed with the Administrative Agent, together with the consent of the
Company to such assignment or transfer (to the extent provided in Section
11.06(b) hereof).
10.02 Reliance by Administrative Agent. The Administrative Agent
---------------------------------
shall be entitled to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone, telecopy, telex,
telegram or cable) believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by the Administrative Agent. As to any matters not expressly provided
for by this Agreement or any other Basic Document, the Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by the Majority
Banks, and such instructions of the Majority Banks and any action taken or
failure to act pursuant thereto shall be binding on all of the Banks.
10.03 Defaults. The Administrative Agent shall not be deemed to
---------
have knowledge or notice of the occurrence of a Default (other than the non-
payment of principal of or interest on Loans or of facility fees) unless the
Administrative Agent has received notice from a Bank or the Company specifying
such Default and stating that such notice is a "Notice of Default". In the
event that the Administrative Agent receives such a notice of the occurrence of
a Default, the Administrative Agent shall give prompt notice thereof to the
Banks (and shall give each Bank prompt notice of each such non-payment). The
Administrative Agent shall (subject to Section 10.07 hereof) take such action
with respect to such Default as shall be directed by the Majority Banks,
provided that, unless and until the Administrative Agent shall have received
- --------
such directions, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default as it shall deem advisable in the best interest of the Banks except to
the extent that this Agreement expressly requires that such action be taken, or
not be taken, only with the consent or upon the authorization of the Majority
Banks or all of the Banks.
10.04 Rights as a Bank. With respect to its Commitment and the
-----------------
Loans made by it, Chase (and any successor acting as Administrative Agent) in
its capacity as a Bank hereunder shall have the same rights and powers hereunder
as any other Bank and may exercise the same as though it were not acting as the
Administrative Agent, and the term "Bank" or "Banks" shall, unless the context
otherwise indicates, include the Administrative Agent in its individual
capacity. Chase (and any successor acting as Administrative Agent) and its
affiliates may (without having to account therefor to any Bank) accept deposits
from, lend money to, make investments in and generally engage in any kind of
banking, trust or other business with the Company (and any of their Subsidiaries
or Affiliates) as if it were not acting as the Administrative Agent, and Chase
and its affiliates may accept fees and other consideration from the Company for
services in connection with this Agreement or otherwise without having to
account for the same to the Banks.
10.05 Indemnification. The Banks agree to indemnify the
----------------
Administrative Agent (to the extent not reimbursed under Section 11.03 hereof,
but without limiting the obligations of the Company under said Section 11.03)
ratably in accordance with their respective Commitments (and, after the
Commitments have been terminated, ratably in accordance with the aggregate
principal amount of the Loans held by the Banks), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever that may be imposed
on, incurred by or asserted against the Administrative Agent (including by any
Bank) arising out of or by reason of any investigation in or in any way relating
to or arising out of this Agreement or any other Basic Document or any other
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including, without limitation, the costs and
expenses that the Company is obligated to pay under Section 11.03 hereof, but
excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof or thereof or of
any such other documents, provided that no Bank shall be liable for any of the
--------
foregoing to the extent they arise from the gross negligence or willful
misconduct of the party to be indemnified.
10.06 Non-Reliance on Administrative Agent and Other Banks. Each
-----------------------------------------------------
Bank agrees that it has, independently and without reliance on the
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Company and its Subsidiaries and decision to enter into this Agreement and that
it will, independently and without reliance upon the Administrative 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 analysis and decisions in
taking or not taking action under this Agreement. The Administrative Agent
shall not be required to keep itself informed as to the performance or
observance by the Company of this Agreement or any of the other Basic Documents
or any other document referred to or provided for herein or therein or to
inspect the Properties or books of the Company or any of its Subsidiaries.
Except for notices, reports and other documents and information expressly
required to be furnished to the Banks by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Bank with any credit or other information concerning the affairs, financial
condition or business of the Company or any of its Subsidiaries (or any of their
affiliates) that may come into the possession of the Administrative Agent or any
of its affiliates.
10.07 Failure to Act. Except for action expressly required of the
---------------
Administrative Agent hereunder and under the other Basic Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Banks of their indemnification
obligations under Section 10.05 hereof against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action.
10.08 Resignation or Removal of Administrative Agent. Subject to
-----------------------------------------------
the appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Banks and the Company, and the Administrative Agent may be removed at any
time with or without cause by the Majority Banks. Upon any such resignation or
removal, the Majority Banks shall have the right to appoint a successor
Administrative Agent. If no successor Administrative Agent shall have been so
appointed by the Majority Banks and shall have accepted such appointment within
30 days after the retiring Administrative Agent's giving of notice of
resignation or the Majority Banks' removal of the retiring Administrative Agent,
then the retiring Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, that shall be a bank having an office in the
continental United States with a combined capital and surplus of at least
$1,000,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Section 10 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent.
10.09 Agency Fee. So long as the Commitments are in effect and
-----------
until payment in full of the principal of and interest on the Loans and all
other amounts payable by the Company hereunder, the Company will pay to the
Administrative Agent an agency fee payable in such amounts and at such times as
separately agreed. Such fee, once paid, shall be non-refundable.
10.10 Consents under Basic Documents. Except as otherwise provided
-------------------------------
in Section 11.04 hereof with respect to this Agreement, the Administrative Agent
may, with the prior consent of the Majority Banks (but not otherwise), consent
to any modification, supplement or waiver under any of the Basic Documents.
Section 11. Miscellaneous.
-------------
11.01 Waiver. No failure on the part of the Administrative Agent or
-------
any Bank to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power or privilege under this Agreement or any Note shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege under this Agreement or any Note preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
11.02 Notices. All notices, requests and other communications
--------
provided for herein (including, without limitation, any modifications of, or
waivers or consents under, this Agreement) shall be given or made in writing
(including, without limitation, by telex or telecopy), delivered to the intended
recipient at the "Address for Notices" specified below its name on the signature
pages hereof; or, as to any party, at such other address as shall be designated
by such party in a notice to each other party. Except as otherwise provided in
this Agreement, all such communications shall be deemed to have been duly given
when transmitted by telex or telecopier or personally delivered or, in the case
of a mailed notice, upon receipt, in each case given or addressed as aforesaid.
11.03 Expenses, Etc. The Company agrees to pay or reimburse each of
---------------
the Banks and the Administrative Agent for paying: (a) all reasonable out-of-
pocket costs and expenses of the Administrative Agent actually incurred
(including, without limitation, the reasonable fees and expenses of Vedder,
Price, Kaufman, Kammholz & Day, special New York counsel to the Banks), in
connection with (i) the negotiation, preparation, execution and delivery of this
Agreement and the other Basic Documents and the Loans hereunder and (ii) any
modification, supplement or waiver of any of the terms of this Agreement or any
of the other Basic Documents; (b) all reasonable costs and expenses of the Banks
and the Administrative Agent actually incurred (including, without limitation,
reasonable counsels' fees) in connection with (i) any Default and any
enforcement or collection proceedings resulting therefrom or in connection with
the negotiation of any restructuring or "work-out" (whether or note
consummated), or the obligations of the Company hereunder and (ii) the
enforcement of this Section 11.03; and (c) all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any of the other Basic
Documents or any other document referred to herein or therein and all costs,
expenses, taxes, assessments and other charges incurred in connection with any
filing, registration, recording or perfection of any security interest
contemplated by any Basic Document or any other document referred to therein.
The Company hereby agrees (i) to indemnify the Administrative Agent
and each Bank and their respective directors, officers, employees, attorneys and
agents from, and hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them (including,
without limitation, any and all losses, liabilities, claims, damages or expenses
incurred by the Administrative Agent to any Bank, whether or not the
Administrative Agent or any Bank is a party thereto) arising out of or by reason
of any investigation or litigation or other proceedings (including any
threatened investigation or litigation or other proceedings) relating to the
Loans hereunder or any actual or proposed use by the Company or any of its
Subsidiaries of the proceeds of any of the Loans hereunder, including, without
limitation, the reasonable fees and disbursements of counsel actually incurred
in connection with any such investigation or litigation or other proceedings
(but excluding any such losses, liabilities, claims, damages or expenses
incurred by reason of the gross negligence or willful misconduct of the Person
to be indemnified) and (ii) not to assert any claim against the Administrative
Agent, any Bank, any of their affiliates, or any of their respective directors,
officers, employees, attorneys and agents, on any theory of liability, for
special, indirect, consequential or punitive damages arising out of or otherwise
relating to any of the transactions contemplated herein or in any other Basic
Document.
11.04 Amendments, Etc. Except as otherwise expressly provided in
-----------------
this Agreement, any provision of this Agreement may be modified or supplemented
only by an instrument in writing signed by the Company, the Administrative Agent
and the Majority Banks, or by the Company and the Administrative Agent acting
with the consent of the Majority Banks, and any provision of this Agreement may
be waived by the Majority Banks or by the Administrative Agent acting with the
consent of the Majority Banks; provided that: (a) no modification, supplement
--------
or waiver shall, unless by an instrument signed by all of the Banks or by the
Administrative Agent acting with the consent of all of the Banks: (i) increase,
or extend the term of the Commitments, or extend the time or waive any
requirement for the reduction or termination of the Commitments, (ii) extend the
date fixed for the payment of principal of or interest on any Loan or any fee
hereunder, (iii) reduce the amount of any such payment of principal, (iv) reduce
the rate at which interest is payable thereon or any fee is payable hereunder,
(v) alter the rights or obligations of the Company to prepay Loans, (vi) alter
the manner in which payments or prepayments of principal, interest or other
amounts hereunder shall be applied as between the Banks or Types of Loans, (vii)
alter the terms of this Section 11.04 or any other provision of this Agreement
requiring consent of all Banks, (viii) modify the definition of the term
"Majority Banks", or modify in any other manner the number or percentage of the
Banks required to make any determinations or waive any rights hereunder or to
modify any provision hereof, or (ix) waive any of the conditions precedent set
forth in Section 6 hereof; and (b) any modification or supplement of Section 10
hereof shall require the consent of the Administrative Agent.
Anything in this Agreement to the contrary notwithstanding, if at a
time when the conditions precedent set forth in Section 6 hereof to any Loan
hereunder are, in the opinion of the Majority Banks, satisfied, any Bank shall
fail to fulfill its obligations to make such Loan then, for so long as such
failure shall continue, such Bank shall (unless the Majority Banks, determined
as if such Bank were not a "Bank" hereunder, shall otherwise consent in writing)
be deemed solely for all purposes relating to amendments, modifications, waivers
or consents under this Agreement or any of the other Basic Documents (including,
without limitation, under this Section 11.04 and under Section 10.10 hereof) to
have no Loans or Commitment, shall not be treated as a "Bank" hereunder when
performing the computation of Majority Banks, and shall have no rights under the
preceding paragraph of this Section 11.04; provided that any action taken by the
other Banks with respect to the matters referred to in clause (a) of the
preceding paragraph shall not be effective as against such Bank.
11.05 Successors and Assigns. This Agreement shall be binding upon
-----------------------
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
11.06 Assignments and Participations.
-------------------------------
(a) The Company may not assign any of its rights or obligations
hereunder or under the Notes without the prior consent of all of the Banks and
the Administrative Agent.
(b) Each Bank may assign any of its Loans, its Note, its Commitment
(but only with the consent of, in the case of its outstanding Commitment, the
Administrative Agent and, so long as no Default shall be continuing, the
Company, which consents shall not be unreasonably withheld); provided that (i)
--------
no such consent by the Company or the Administrative Agent shall be required in
the case of any assignment to another Bank (or a banking Affiliate of such
assigning Bank or any other Bank); (ii) any such partial assignment shall be in
an amount at least equal to $5,000,000; and (iii) each such assignment by a Bank
of its Loans, Note or Commitment shall be made in such manner so that the same
portion of its Loans, Note and Commitment is assigned to the respective
assignee. Upon execution and delivery by the assignee to the Company and the
Administrative Agent of an instrument in writing pursuant to which such assignee
agrees to become a "Bank" hereunder (if not already a Bank) having the
Commitment and Loans specified in such instrument, and upon consent thereto by
the Company and the Administrative Agent, to the extent required above, the
assignee shall have, to the extent of such assignment (unless otherwise provided
in such assignment with the consent of the Company and the Administrative Agent,
the obligations, rights and benefits of a Bank hereunder holding the Commitment
and Loans (or portions thereof) assigned to it (in addition to the Commitment
and Loans, if any, theretofore held by such assignee) and the assigning Bank
shall, to the extent of such assignment, be released from the Commitment (or
portion thereof) so assigned. Upon each such assignment the assigning Bank
shall pay the Administrative Agent an assignment fee of $3,000.
(c) A Bank may sell or agree to sell to one or more other Persons a
participation in all or any part of any Loans held by it, or in its Commitment,
in which event each purchaser of a participation (a "Participant") shall be
-----------
entitled, to the extent necessary to comply with applicable banking laws and
regulations, to the rights and benefits of the provisions of Section 8.01(j)
hereof with respect to its participation in such Loans and Commitment as if (and
the Company shall be directly obligated to such Participant under such
provisions as if) such Participant were a "Bank" for purposes of said Section,
but, except as otherwise provided in Section 4.07(c) hereof, shall not have any
other rights or benefits under this Agreement or any Note or any other Basic
Document (the Participant's rights against such Bank in respect of such
participation to be those set forth in the agreements executed by such Bank in
favor of the Participant). All amounts payable by the Company to any Bank under
Section 5 hereof in respect of such Loans and Commitment shall be determined as
if such Bank had not sold or agreed to sell any participations in such Loans and
Commitment, and as if such Bank were funding each of such Loans and Commitment
in the same way that it is funding the portion of such Loans and Commitment in
which no participations have been sold. In no event shall a Bank that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Basic Document except that such Bank may
agree with the Participant that it will not, without the consent of the
Participant, agree to (i) increase or extend the term, or extend the time or
waive any requirement for the reduction or termination, of such Bank's
Commitment, (ii) extend the date fixed for the payment of principal of or
interest on the related Loan or Loans or any portion of any fee hereunder
payable to the Participant, (iii) reduce the amount of any such payment of
principal, (iv) reduce the rate at which interest is payable thereon, or any fee
hereunder payable to the Participant, to a level below the rate at which the
Participant is entitled to receive such interest or fee, (v) alter the rights or
obligations of the Company to prepay the related Loans or (vi) consent to any
modification, supplement or waiver hereof or of any of the other Basic Documents
to the extent that the same, under Section 10.10 or 11.04 hereof, requires the
consent of each Bank.
(d) In addition to the assignments and participations permitted under
the foregoing provisions of this Section 11.06, any Bank may (without notice to
the Company, the Administrative Agent or any other Bank and without payment of
any fee) assign and pledge all or any portion of its Loans and its Note to any
Federal Reserve Bank as collateral security pursuant to Regulation A and any
Operating Circular issued by such Federal Reserve Bank. No such assignment
shall release the assigning Bank from its obligations hereunder.
(e) A Bank may furnish any information concerning the Company or any
of its Subsidiaries in the possession of such Bank from time to time to
assignees and participants (including prospective assignees and participants),
subject, however, to the provisions of Section 11.12(b) hereof.
(f) Anything in this Section 11.06 to the contrary notwithstanding,
no Bank may assign or participate any interest in any Loan held by it hereunder
to the Company or any of its Affiliates or Subsidiaries without the prior
written consent of each Bank.
11.07 Survival. The obligations of the Company under Sections 5.01,
---------
5.05, 5.06 and 11.03 hereof and the obligations of the Banks under Section 10.05
hereof shall survive the repayment of the Loans and the termination of the
Commitments. In addition, each representation and warranty made, or deemed to
be made by a notice of any Loan, herein or pursuant hereto shall survive the
making of such representation and warranty, and no Bank shall be deemed to have
waived, by reason of making any Loan hereunder, any Default that may arise by
reason of such representation or warranty proving to have been false or
misleading, notwithstanding that such Bank or the Administrative Agent may have
had notice or knowledge or reason to believe that such representation or
warranty was false or misleading at the time such Loan was made.
11.08 Captions. The table of contents and captions and section
---------
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
11.09 Counterparts. This Agreement may be executed in any number of
-------------
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
11.10 Governing Law; Submission to Jurisdiction. This Agreement and
------------------------------------------
the Notes shall be governed by, and construed in accordance with, the law of the
State of New York. The Company hereby submits to the nonexclusive jurisdiction
of the United States District Court for the Southern District of New York and of
any New York state court sitting in New York City for the purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. The Company irrevocably waives, to the fullest extent
permitted by applicable law, any objection that 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.
11.11 Waiver of Jury Trial. EACH OF THE COMPANY, THE ADMINISTRATIVE
---------------------
AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, 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.
11.12 Treatment of Certain Information; Confidentiality.
--------------------------------------------------
(a) The Company acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
the Company or one or more of its Subsidiaries (in connection with this
Agreement or otherwise) by any Bank or by one or more subsidiaries or affiliates
of such Bank and the Company hereby authorizes each Bank to share any
information delivered to such Bank by the Company and its Subsidiaries pursuant
to this Agreement, or in connection with the decision of such Bank to enter into
this Agreement, to any such subsidiary or affiliate, it being understood that
any such subsidiary or affiliate receiving such information shall be bound by
the provisions of Section 11.12(b) hereof as if it were a Bank hereunder. Such
authorization shall survive the repayment of the Loans and the termination of
the Commitments.
(b) Each Bank and the Administrative Agent agrees (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of this nature and in accordance with safe and sound banking practices, any non-
public information supplied to it by the Company pursuant to this Agreement that
is identified by the Company as being confidential at the time the same is
delivered to the Banks or the Administrative Agent, provided that nothing herein
--------
shall limit the disclosure of any such information (i) after such information
shall have become public (other than through a violation of this Section 11.12),
(ii) to the extent required by statute, rule, regulation or judicial process,
(iii) to counsel for any of the Banks or the Administrative Agent, (iv) to bank
examiners (or any other regulatory authority having jurisdiction over any Bank
or the Administrative Agent), auditors or accountants, (v) to the Administrative
Agent or any other Bank (or to Chase Securities, Inc.), (vi) in connection with
any litigation to which any one or more of the Banks or the Administrative Agent
is a party, or in connection with the enforcement of rights or remedies
hereunder or under any other Basic Document, (vii) to a subsidiary or affiliate
of such Bank as provided in Section 11.12(a) hereof or (viii) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant (or prospective assignee or participant) first executes and delivers
to the respective Bank a Confidentiality Agreement substantially in the form of
Exhibit D hereto (or executes and delivers to such Bank an acknowledgement to
the effect that it is bound by the provisions of this Section 11.12(b), which
acknowledgement may be included as part of the respective assignment or
participation agreement pursuant to which such assignee or participant acquires
an interest in the Loans hereunder); provided, further, that in no event shall
-------- -------
any Bank or the Administrative Agent be obligated or required to return any
materials furnished by the Company. The obligations of any assignee that has
executed a Confidentiality Agreement in the form of Exhibit D hereto shall be
superseded by this Section 11.12 upon the date upon which such assignee becomes
a Bank hereunder pursuant to Section 11.06(b) hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
PROVIDENT COMPANIES, INC.
By /s/ George Shell
---------------------------------
Title: Treasurer
Address for Notices:
Provident Companies, Inc.
One Fountain Square
Chattanooga, TN 37402
Attention: Treasurer
Telecopier No.: (423) 755-1671
Telephone No.: (423) 755-1011
BANKS
-----
Commitment THE CHASE MANHATTAN BANK
- ----------
$44,000,000
By /s/ Heather Lindstrom
---------------------------------
Title: Vice President
Lending Office for all Loans:
The Chase Manhattan Bank
1 Chase Manhattan Plaza
New York, New York 10081
Address for Notices:
The Chase Manhattan Bank
1 Chase Manhattan Plaza
New York, New York 10081
Attention: Dennis Cogan
Telecopier No.: (212) 552-1999
Telephone No.: (212) 552-4600
Commitment AMSOUTH BANK OF ALABAMA
- ----------
$42,000,000
By /s/ John J. Hooker
---------------------------------
Title: Commercial Banking Officer
Lending Office for All Loans:
Amsouth Bank of Alabama
1900 5th Avenue North
Birmingham, AL 35203
Address for Notices:
Amsouth Bank of Alabama
1900 5th Avenue North
Birmingham, AL 35203
Attention: John J. Hooker
Telecopier No.: (205) 326-5601
Telephone No.: (205) 307-4139
Commitment THE FIRST NATIONAL BANK OF CHICAGO
- ----------
$42,000,000
By /s/ Paul T. Schultz
---------------------------------
Title: Managing Director
Lending Office for All Loans:
The First National Bank of Chicago
One First National Plaza
Suite 0085
Chicago, IL 60670-0085
Address for Notices:
The First National Bank of Chicago
One First National Plaza
Suite 0085
Chicago, IL 60670-0085
Attention: Paul T. Schultz
Telecopier No.: (312) 732-4033
Telephone No.: (312) 732-7074
Commitment FIRST UNION NATIONAL BANK OF
- ----------
NORTH CAROLINA
$42,000,000
By /s/ James M. Kipp
---------------------------------
Title: Senior Vice President
Lending Office for All Loans:
First Union National Bank of
North Carolina
301 S. College Street, DC-5
Charlotte, NC 28288-0735
Address for Notices:
First Union National Bank of
North Carolina
301 S. College Street, DC-5
Charlotte, NC 28288-0735
Attention: Robert Mayer
Telex No.: 684-3115/Funcha
Telecopier No.: (704) 383-9144
Telephone No.: (704) 374-6628
Commitment FLEET NATIONAL BANK
- ----------
$42,000,000
By /s/ Thomas E. McKinlay
---------------------------------
Title: Senior Vice President
Lending Office for All Loans:
Fleet National Bank
777 Main Street
Ins. Industry CJ/MO/0250
Hartford, CT 06115
Address for Notices:
Fleet National Bank
777 Main Street
Ins. Industry CJ/MO/0250
Hartford, CT 06115
Attention: Thomas McKinlay
Telecopier No.: (860) 986-1094
Telephone No.: (860) 986-4139
Commitment MELLON BANK, N.A.
- ----------
$42,000,000
By /s/ Timothy J. Marchando
---------------------------------
Title: Assistant Vice President
Lending Office for All Loans:
Mellon Bank, N.A.
Three Mellon Bank Center
Room 2302
Pittsburgh, PA 15230
Address for Notices:
Mellon Bank, N.A.
One Mellon Bank Center
Room 370
Pittsburgh, PA 15258-0001
Attention: Timothy J. Marchando
Telecopier No.: (412) 234-8087
Telephone No.: (412) 234-7922
Commitment ROYAL BANK OF CANADA
- ----------
$42,000,000
By /s/ Yvonne J. Bernard
---------------------------------
Title: Manager
Lending Office for All Loans:
Royal Bank of Canada
One Financial Square - 23rd Floor
New York, NY 10005-3531
Address for Notices:
Royal Bank of Canada
One Financial Square - 24th Floor
New York, NY 10005-3531
Attention: Gary Overton
Telecopier No.: (212) 809-7468
Telephone No.: (212) 428-6277
Commitment SUNTRUST BANK, Atlanta
- ----------
$42,000,000
By /s/ Frank R. Callison
---------------------------------
Title: Vice President
Lending Office for All Loans:
SunTrust Bank
Mail Code 118
P.O. Box 4418
Atlanta, GA 30302
Address for Notices:
SunTrust Bank
Mail Code 118
P.O. Box 4418
Atlanta, GA 30302
Attention: Frank R. Callison
Telecopier No.: (404) 588-8066
Telephone No.: (404) 658-4905
Commitment BANK OF MONTREAL
- ----------
$30,000,000
By /s/ J. Donald Higgins
---------------------------------
Title: Managing Director
Lending Office for All Loans:
Bank of Montreal
115 S. LaSalle
12th Floor - West
Chicago, IL 60603
Address for Notices:
Bank of Montreal
115 S. LaSalle
12th Floor - West
Chicago, IL 60603
Attention: Bruce Cox
Telecopier No.: (312) 750-4352
Telephone No.: (312) 750-3891
Commitment BANK OF TOKYO-MITSUBISHI
- ----------
TRUST COMPANY
$30,000,000
By /s/ Dane E. Holmes
---------------------------------
Title: Attorney-In-Fact
Lending Office for All Loans:
Bank of Tokyo-Mitsubishi
Trust Company
1251 Avenue of the Americas
12th Floor
New York, NY 10020-1104
Address for Notices:
Bank of Tokyo-Mitsubishi
Trust Company
1251 Avenue of the Americas
12th Floor
New York, NY 10020-1104
Attention: Dane E. Holmes
Telecopier No.: (212) 782-4935
Telephone No.: (212) 782-4354
Commitment DEUTSCHE BANK AG, New York
- ----------
and/or Cayman Islands Branches
$30,000,000
By /s/ Louis Caltavuturo
---------------------------------
Title: Associate
By /s/ Eckhard Osenberg
---------------------------------
Title: Assistant Vice President
Lending Office for Base Rate Loans:
Deutsche Bank AG
New York Branch
31 West 52nd Street
New York, NY 10019
Lending Office for Eurodollar Loans:
Deutsche Bank AG
Cayman Islands Branch
31 West 52nd Street
New York, NY 10019
Address for Notices:
Deutsche Bank AG
New York Branch
31 West 52nd Street
New York, NY 10019
Attention: CFS, Cheryl Mandelbaum
Telex No.: 429166/DEUT BK NY
Telecopier No.: (212) 469-7880
Telephone No.: (212) 469-8426
Commitment DRESDNER BANK A.G. New York Branch
- ----------
and Grand Cayman Branch
$30,000,000
By /s/ Lloyd C. Stevens
---------------------------------
Title: Assistant Vice President
By /s/ Latisha Azweem
---------------------------------
Title: Assistant Treasurer
Lending Office for Base Rate Loans:
Dresdner Bank A.G.
New York Branch
75 Wall Street
New York, New York 10005-2889
Lending Office for Eurodollar Loans:
Dresdner Bank A.G.
Grand Cayman Branch
75 Wall Street
New York, New York 10005-2889
Address for Notices:
Dresdner Bank A.G.
New York Branch
75 Wall Street
New York, New York 10005-2889
Attention: Lora Lam
Telex No.: 421 750 DRESUZ
Telecopier No.: (212) 429-2130
Telephone No.: (212) 429-2288
Commitment NATIONSBANK, N.A. (South)
- ----------
$30,000,000
By /s/ William R. Herrell
---------------------------------
Title: Officer
Lending Office for All Loans:
NationsBank, N.A.
101 N. Tryon Street
Charlotte, NC 28255
Address for Notices:
NationsBank, N.A.
101 N. Tryon Street
Charlotte, NC 28255
Attention: Cathy Matthews
Telecopier No.: (704) 386-8694
Telephone No.: (704) 388-1110
Commitment THE SANWA BANK, LIMITED
- ----------
Atlanta Agency
$30,000,000
By /s/ Shelley Browne
---------------------------------
Title: President
Lending Office for All Loans:
The Sanwa Bank, Limited
55 E. 52nd Street
New York, New York 10055
Address for Notices:
The Sanwa Bank, Limited
55 E. 52nd Street
New York, New York 10055
Attention: Ms. Renka Hara
Telex No.: 4611830
Telecopier No.: (212) 754-2368
Telephone No.: (212) 339-6390
Commitment THE BANK OF NOVA SCOTIA
- ----------
$30,000,000
By /s/ P.M. Brown
---------------------------------
Title: Relationship Manager
Lending Office for All Loans:
The Bank of Nova Scotia
600 Peachtree St., N.E.
Suite 2700
Atlanta, GA 30308
Address for Notices:
The Bank of Nova Scotia
600 Peachtree St., N.E.
Suite 2700
Atlanta, GA 30308
Attention: Patrick M. Brown
Telex No.: 542319/Scotiabk Atl
Telecopier No.: (404) 888-8998
Telephone No.: (404) 877-1506
Commitment THE SUMITOMO BANK, LIMITED,
- ----------
Atlanta Agency
$30,000,000
By /s/ Masayuki Fukushima
---------------------------------
Title: Joint General Manager
Lending Office for All Loans:
The Sumitomo Bank, Limited
Atlanta Agency
133 Peachtree Street
Suite 3210
Atlanta, Georgia 30303
Address for Notices:
The Sumitomo Bank, Limited
Atlanta Agency
133 Peachtree Street
Suite 3210
Atlanta, Georgia 30303
Attention: Tom Lawson
Telecopier No.: (404) 523-0547
Telephone No.: (404) 526-8513
Commitment ABN AMRO BANK N.V., New York Branch
- ----------
$20,000,000
By /s/ Parker H. Douglas
---------------------------------
Title: Group Vice President
By /s/ David W. Eastep
---------------------------------
Title: Assistant Vice President
Lending Office for All Loans:
ABN Amro Bank N.V.
500 Park Avenue
New York, New York 10022
Address for Notices:
ABN Amro Bank N.V.
500 Park Avenue
New York, New York 10022
Attention: Victor J. Fennon
Telex No.: 423-721 amro ur
Telecopier No.: (212) 446-4335
Telephone No.: (212) 446-4230
Commitment BANQUE NATIONALE DE PARIS
- ----------
$20,000,000
By /s/ Phil Truesdale
---------------------------------
Title: Vice President
By /s/ Barry S. Feigenbaum
---------------------------------
Title: Senior Vice President
Lending Office for All Loans:
Banque Nationale De Paris
499 Park Avenue
New York, New York 10022
Address for Notices:
Banque Nationale De Paris
499 Park Avenue
New York, New York 10022
Attention: Phil Truesdale
Telex No.: 824209
Telecopier No.: (212) 415-9695
Telephone No.: (212) 415-9719
Commitment CREDIT LYONNAIS New York Branch
- ----------
$20,000,000
By /s/ Renaud d'Herbes
---------------------------------
Title: Senior Vice President
Lending Office for All Loans:
Credit Lyonnais New York Branch
1301 Avenue of Americas
New York, New York 10019
Address for Notices:
Credit Lyonnais New York Branch
1301 Avenue of Americas
New York, New York 10019
Attention: Peter Rasmussen
Telex No.: 62410 YLRC
Telecopier No.: (212) 261-3401
Telephone No.: (212) 261-7710
Commitment THE DAI-ICHI KANGYO BANK, LIMITED
- ----------
Atlanta Agency
$20,000,000
By /s/ Takao Mochizuki
---------------------------------
Title: General Manager
Lending Office for All Loans:
The Dai-Ichi Kangyo Bank, Limited
Marquis Two Tower, Suite 2400
285 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303
Address for Notices:
The Dai-Ichi Kangyo Bank, Limited
Marquis Two Tower, Suite 2400
285 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303
Attention: Michael L. Turner
Telex No.: 544173
Telecopier No.: (404) 222-9657
Telephone No.: (404) 581-0200
Commitment PNC BANK, N.A.
$20,000,000
By /s/ Eileen McDonald
---------------------------------
Title: Assistant Vice President
Lending Office for All Loans:
PNC Bank, N.A.
2 Tower Center
East Brunswick, NJ 08816
Address for Notices:
PNC Bank, N.A.
2 Tower Center
East Brunswick, NJ 08816
Attention: Eileen M. McDonald
Telecopier No.: (908) 220-3270
Telephone No.: (908) 220-3265
Commitment THE SAKURA BANK, LIMITED,
- ----------
Atlanta Agency
$20,000,000
By /s/ Hiroyasu Imanishi
---------------------------------
Title: Vice President
and Senior Manager
Lending Office for All Loans:
The Sakura Bank, Limited
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Address for Notices:
The Sakura Bank, Limited
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Attention: Charles S. Zimmerman
Telecopier No.: (404) 521-1133
Telephone No.: (404) 521-3111
Commitment SOCIETE GENERALE, New York Branch
- ----------
$20,000,000
By /s/ Laura A. Hope
---------------------------------
Title: Vice President
Lending Office for All Loans:
Societe Generale
1221 Avenue of the Americas
New York, New York 10020
Address for Notices:
Societe Generale
1221 Avenue of the Americas
New York, New York 10020
Attention: Lisa Kim
Telex No.: 428802
Telecopier No.: (212) 278-7153
Telephone No.: (212) 278-6850
Commitment STATE STREET BANK & TRUST COMPANY
- ----------
$20,000,000
By /s/ Edward M. Anderson
---------------------------------
Title: Vice President
Lending Office for All Loans:
State Street Bank & Trust Company
108 Myrtle Street
No. Quincy, MA 02171
Credit Services AH-2
Address for Notices:
State Street Bank & Trust Company
108 Myrtle Street
No. Quincy, MA 02171
Credit Services AH-2
Attention: Edward M. Anderson
Telecopier No.: (617) 985-2176
Telephone No.: (617) 985-5301
Commitment WACHOVIA BANK OF GEORGIA, N.A.
- ----------
$42,000,000
By /s/ Karin E. Reel
---------------------------------
Title: Banking Officer
Lending Office for All Loans:
Wachovia Bank of Georgia, N.A.
191 Peachtree St., NE
MC GA-3940
Atlanta, GA 30303
Address for Notices:
Wachovia Bank of Georgia, N.A.
191 Peachtree St., NE
MC GA-3940
Atlanta, GA 30303
Attention: Karin Reel
Telecopier No.: (404) 332-5016
Telephone No.: (404) 332-5187
Commitment FUJI BANK, LIMITED, Atlanta Agency
- ----------
$20,000,000
By /s/ Toshihiro Mitsui
---------------------------------
Title: Vice President and Manager
Lending Office for All Loans:
Fuji Bank, Limited, Atlanta Agency
Marquis One Tower
245 Peachtree Center Ave. NE
Suite 2100
Atlanta, GA 30303
Address for Notices:
Fuji Bank, Limited, Atlanta Agency
Marquis One Tower
245 Peachtree Center Ave. NE
Suite 2100
Atlanta, GA 30303
Attention: Eddie Hunter
Telecopier No.: (404) 653-2119
Telephone No.: (404) 653-3133
THE CHASE MANHATTAN BANK,
as Administrative Agent
By /s/ Heather Lindstrom
---------------------------------
Title: Vice President
Address for Notices to
Chase as Administrative Agent:
The Chase Manhattan Bank
4 Chase MetroTech Center
13th Floor
Brooklyn, New York 11245
Attention: Laura Rebecca
New York Agency
Telex No.: 6720516
(Answerback: CMB NYA UW)
Telecopier No.: (718) 242-6909
SCHEDULE III
Investment Companies
--------------------
[To be supplied, if applicable]
EXHIBIT A
[Form of Note]
PROMISSORY NOTE
$ _______________ July __, 1996
New York, New York
FOR VALUE RECEIVED, PROVIDENT COMPANIES, INC., a Delaware corporation
(the "Company"), hereby promises to pay to __________________ (the "Bank"), for
------- ----
account of its respective Applicable Lending Offices provided for by the Credit
Agreement referred to below, at the principal office of The Chase Manhattan Bank
at 1 Chase Manhattan Plaza, New York, New York 10081, the principal sum of
_______________ Dollars (or such lesser amount as shall equal the aggregate
unpaid principal amount of the Loans made by the Bank to the Company under the
Credit Agreement), in lawful money of the United States of America and in
immediately available funds, on the dates and in the principal amounts provided
in the Credit Agreement, and to pay interest on the unpaid principal amount of
each such Loan, at such office, in like money and funds, for the period
commencing on the date of such Loan until such Loan shall be paid in full, at
the rates per annum and on the dates provided in the Credit Agreement.
The date, amount, Type, interest rate and duration of Interest Period
(if applicable) of each Loan made by the Bank to the Company, and each payment
made on account of the principal thereof, shall be recorded by the Bank on its
books and, prior to any transfer of this Note, endorsed by the Bank on the
schedule attached hereto or any continuation thereof, provided that the failure
--------
of the Bank to make any such recordation or endorsement shall not affect the
obligations of the Company to make a payment when due of any amount owing under
the Credit Agreement or hereunder in respect of the Loans made by the Bank.
This Note is one of the Notes referred to in the Credit Agreement
dated as of July 30, 1996 (as modified and supplemented and in effect from time
to time, the "Credit Agreement") between the Company, the lenders named therein
----------------
and The Chase Manhattan Bank, as Administrative Agent, and evidences Loans made
by the Bank thereunder. Terms used but not defined in this Note have the
respective meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity of
this Note upon the occurrence of certain events and for prepayments of Loans
upon the terms and conditions specified therein.
Except as permitted by Section 11.06(b) of the Credit Agreement, this
Note may not be assigned by the Bank to any other Person.
This Note shall be governed by, and construed in accordance with, the
law of the State of New York.
PROVIDENT COMPANIES, INC.
By_________________________
Title:
SCHEDULE OF LOANS
This Note evidences Loans made, Continued or Converted under the
within-described Credit Agreement to the Company, on the dates, in the principal
amounts, of the Types, bearing interest at the rates and having Interest Periods
(if applicable) of the durations set forth below, subject to the payments,
Continuations, Conversions and prepayments of principal set forth below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
- ----------- ------ ---- -------- -------- --------- ------ --------
EXHIBIT B
[Form of Opinion of Counsel to the Company]
July ___, 1996
To: The Banks party to the Credit Agreement referred to
below and The Chase Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
I am Vice President-General Counsel of Provident Companies, Inc., a
corporation organized under the laws of the State of Delaware (the "Company") in
-------
connection with the Credit Agreement dated as of July 30, 1996 (the "Credit
------
Agreement") among the Company, the financial institutions named therein and The
- ---------
Chase Manhattan Bank, as Administrative Agent, providing for loans to be made by
said banks to the Company in an aggregate principal amount not exceeding
$800,000,000 at any one time outstanding. Terms defined in the Credit Agreement
are used herein as defined therein. As used herein, the term "Loan Documents"
refers, collectively, to the Credit Agreement and the Notes.
In rendering the opinions expressed below, I have examined:
(i) the Credit Agreement;
(ii) the Notes; and
(iii) such corporate records of the Company and such other documents
as I have deemed necessary as a basis for the opinions expressed
below.
In my examination, I have assumed the genuineness of all signatures, the
authenticity of all documents submitted to me as originals and the conformity
with authentic original documents of all documents submitted to me as copies.
When relevant facts were not independently established, I have relied upon
statements of governmental officials and upon representations made in or
pursuant to the Loan Documents and certificates of appropriate representatives
of the Company.
In rendering the opinions expressed below, I have assumed, with
respect to all of the documents referred to in this opinion letter, that
(except, to the extent set forth in the opinions expressed below, as to the
Company):
(i) such documents have been duly authorized by, have been duly
executed and delivered by, and constitute legal, valid, binding
and enforceable obligations of, all of the parties to such
documents;
(ii) all signatories to such documents have been duly authorized; and
(iii) all of the parties to such documents are duly organized and
validly existing and have the power and authority (corporate or
other) to execute, deliver and perform such documents.
Based upon and subject to the foregoing and subject to the comments
and qualifications set forth below, I am of the opinion that:
1. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware. To my knowledge, no
governmental authority has asserted that the Company or any Subsidiary is
required to be licensed or qualified in any foreign jurisdiction in which
the Company or such Subsidiary is not now licensed or qualified.
2. The Company has all requisite corporate power to execute and deliver,
and to perform its obligations under, the Credit Agreement, the Notes and
the Purchase Agreement and to borrow under the Credit Agreement.
3. The execution, delivery and performance by the Company of the Credit
Agreement, the borrowings under the Credit Agreement and the consummation
of the Acquisition (i) have been duly authorized by all necessary corporate
action on the part of the Company and (ii) do not and will not (a) violate
any provision of the charter or by-laws of the Company, (b) violate any
applicable law, rule or regulation, (c) violate any order, writ, injunction
or decree of any court or governmental authority or agency or any arbitral
award applicable to the Company or any of its Subsidiaries of which I have
knowledge (after due inquiry) or (d) result in a breach of, constitute a
default under, require any consent under, or result in the acceleration or
required prepayment of any indebtedness pursuant to the terms of, any
agreement or instrument of which I have knowledge (after due inquiry) to
which the Company or any of its Subsidiaries is a party or by which any of
them is bound or to which any of them is subject, or result in the creation
or imposition of any Lien upon any Property of the Company or any of its
Subsidiaries pursuant to the terms of any such agreement or instrument.
4. Each of the Loan Documents (assuming, in the case of the Notes,
execution and delivery thereof for value) and the Purchase Agreement
constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights of creditors generally and
except as the enforceability of the Loan Documents is subject to the
application of general principles of equity (regardless of whether
considered in a proceeding in equity or at law), including, without
limitation, (a) the possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b) concepts of
materiality, reasonableness, good faith and fair dealing.
5. Except for [list], each of which is in full force and effect, no
authorization, approval or consent of, and no filing or registration with,
any governmental or regulatory authority or agency of the United States of
America or the States of Delaware or Tennessee is required on the part of
the Company for the execution, delivery or performance by the Company of
the Loan Documents or the Purchase Agreement.
6. I have no knowledge (after due inquiry) of any legal or arbitral
proceedings, or any proceedings by or before any governmental or regulatory
authority or agency, now pending or threatened against the Company or any
of its Subsidiaries or any of their respective Properties that, if
adversely determined, could have a Material Adverse Effect.
7. Under the law of the State of Tennessee, a foreign corporation is not
required solely as a lender holding Indebtedness, to procure a certificate
of authority to transact business or otherwise qualify to do business. As
such, neither the Administrative Agent nor any of the Banks, solely by
reason of the making of the extensions of credit contemplated by the Credit
Agreement, will (a) be required to qualify to do business in the State of
Tennessee or to comply with the requirements of any foreign registration or
qualification statute of the State of Tennessee, (b) be subject to taxation
by the State of Tennessee or any political subdivision of said State or (c)
be required to make any filing with any court or other judicial
administrative body in or of the State of Tennessee preceding enforcement
in order to carry out any of the transactions contemplated by the Credit
Agreement or to avail itself of any of the remedies provided by the Credit
Agreement.
The foregoing opinions are subject to the following comments and
qualifications:
A. The enforceability of Section 11.03 of the Credit Agreement may be
limited by laws rendering unenforceable indemnification contrary to Federal
or state securities laws and the public policy underlying such laws.
B. The enforceability of provisions in the Credit Agreement to the effect
that terms may not be waived or modified except in writing may be limited
under certain circumstances.
C. I express no opinion as to (i) the effect of the laws of any
jurisdiction in which any Bank is located (other than Tennessee) that limit
the interest, fees or other charges such Bank may impose, (ii) Section
4.07(c) of the Credit Agreement and (iii) the second sentence of Section
11.10 of the Credit Agreement, insofar as such sentence relates to the
subject matter jurisdiction of the United States District Court for the
Southern District of New York to adjudicate any controversy related to the
Loan Documents.
The foregoing opinions are limited to matters involving the Federal
laws of the United States, the Delaware General Corporation Law and the law of
the State of Tennessee and I do not express any opinion as to the laws of any
other jurisdiction.
This opinion letter is, pursuant to Section 6.01(c) of the Credit
Agreement, provided to you by me in my capacity as counsel to the Company and
may not be relied upon by any Person for any purpose other than in connection
with the transactions contemplated by the Credit Agreement without, in each
instance, my prior written consent.
Very truly yours,
EXHIBIT C
[Form of Opinion of Special New York Counsel to the Banks]
July __, 1996
To: The Banks party to the Credit Agreement referred to below and The Chase
Manhattan Bank, as Administrative Agent
Ladies and Gentlemen:
We have acted as special New York counsel to the Banks in connection with
the Credit Agreement (the "Credit Agreement") dated as of July 30, 1996, between
----------------
Provident Companies, Inc. (the "Company"), the financial institutions named
-------
therein and The Chase Manhattan Bank, as Administrative Agent, providing for
loans to be made by said banks to the Company in an aggregate principal amount
not exceeding $800,000,000 at any one time outstanding. Terms defined in the
Credit Agreement are used herein as defined therein.
We have assumed for purposes of our opinion hereinafter set forth that
the Credit Agreement has been duly authorized, executed and delivered by the
Company, each Bank and the Administrative Agent, and that the Company is duly
incorporated and validly existing under the laws of Delaware and has full power,
authority and legal right to make and perform the Credit Agreement and the
Notes.
We have examined originals or copies authenticated to our satisfaction of
all such corporate records of the Company, agreements and other instruments,
certificates of public officials and of officers and representatives of the
Company and other documents, as we have deemed necessary in connection with the
opinions hereinafter expressed. In such examination we have assumed the
genuineness of all signatures, the authenticity of documents submitted to us as
originals, the conformity with the originals of all documents submitted to us as
certified or photostatic copies, and the authenticity of the originals of such
latter documents. As to questions of fact material to such opinions we have,
when relevant facts were not independently established, relied upon
representations and certificates of the Company and its officers.
Based upon the foregoing and subject to the comments and qualifications
set forth below, we are of the opinion that the Credit Agreement constitutes,
and the Notes when executed and delivered for value will constitute, valid and
binding obligations of the Company enforceable in accordance with their
respective terms, except as such enforceability may be limited by (a)
bankruptcy, insolvency, reorganization, moratorium or other similar laws of
general applicability affecting the enforcement of creditors' rights and (b) the
application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), and except
that we express no opinion as to (i) Section 4.07(c) of the Credit Agreement,
(ii) the effect of the law of any jurisdiction (other than the State of New
York) wherein any Bank (including any of its Applicable Lending Offices) may be
located which limits rates of interest which may be charged or collected by such
Bank, (iii) whether a Federal or state court outside of the State of New York
would give effect to the choice of New York law provided for in the Credit
Agreement and the Notes, (iv) the second sentence of Section 11.10 of the Credit
Agreement, insofar as such sentence relates to the subject matter jurisdiction
of the United States District Court for the Southern District of New York to
adjudicate any controversy related to the Credit Agreement or the Notes, (v) the
waiver of inconvenient forum set forth in Section 11.10 of the Credit Agreement
with respect to proceedings in the United States District Court for the Southern
District of New York or (vi) Section 11.11 of the Credit Agreement.
In connection with the above, we wish to point out that provisions of the
Credit Agreement which permit the Administrative Agent or any Bank to take
action or make determinations, or to benefit from indemnities and similar
undertakings of the Company, may be subject to a requirement that such action be
taken or such determinations be made, and that any action or inaction by the
Administrative Agent or a Bank which may give rise to a request for payment
under such an undertaking be taken or not taken, on a reasonable basis and in
good faith.
We are members of the bar of the State of New York and we do not herein
intend to express any opinion as to any matters governed by any laws other than
the law of the State of New York and the Federal law of the United States of
America.
Very truly yours,
EXHIBIT D
[Form of Confidentiality Agreement]
CONFIDENTIALITY AGREEMENT
[Date]
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Credit Agreement dated as of July 30, 1996, between Provident
Companies, Inc. (the "Company"), the financial institutions named
-------
therein and The Chase Manhattan Bank, as Administrative Agent.
Dear _____________:
As a Bank party to the above-referenced Credit Agreement (the "Credit
------
Agreement"), we have agreed with Provident Companies, Inc. (the "Company")
- --------- -------
pursuant to Section 11.12 of the Credit Agreement to use reasonable precautions
to keep confidential, except as otherwise provided therein, all non-public
information identified by the Company as being confidential at the time the same
is delivered to us pursuant to the Credit Agreement.
As provided in said Section 11.12, we are permitted to provide you, as a
prospective [holder of a participation in the Loans (as defined in the Credit
Agreement)][assignee Bank], with certain of such non-public information subject
to the execution and delivery by you, prior to receiving such non-public
information, of a Confidentiality Agreement in this form. Such information
will not be made available to you until your execution and return to us of this
Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you agree (on behalf of
yourself and each of your affiliates, directors, officers, employees and
representatives) that (A) such information will not be used by you except in
connection with the proposed [participation] [assignment] mentioned above and
(B) you shall use reasonable precautions, in accordance with your customary
procedures for handling confidential information and in accordance with safe and
sound banking practices, to keep such information confidential, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to your
counsel or to counsel for any of the Banks or the Administrative Agent, (iii) to
bank examiners, auditors or accountants, (iv) to the Administrative Agent or any
other Bank (or to Chase Securities, Inc.), (v) in connection with any litigation
to which you or any one or more of the Banks or the Administrative Agent are a
party, (vi) to a subsidiary or affiliate of yours as provided in Section
11.12(a) of the Credit Agreement or (vii) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to you a
Confidentiality Agreement substantially in the form hereof, and provided further
that in no event shall you be obligated to return any materials furnished to you
pursuant to this Confidentiality Agreement.
Would you please indicate your agreement to the foregoing by signing at
the place provided below the enclosed copy of this Confidentiality Agreement.
Very truly yours,
[Insert Name of Bank]
By ______________________________
The foregoing is
agreed to as of the
date of this letter
[Insert name of
prospective
participant or
assignee]
By