Exhibit 10-I
CONFORMED COPY
=============================================================================
FIFTH AMENDED AND RESTATED COMMITMENT
TRANSFER AGREEMENT
Dated as of May 1, 1995
CHRYSLER FINANCIAL CORPORATION,
as Borrower
CHEMICAL BANK, as Agent
============================================================================
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS................................................. 1
1.1 Defined Terms............................................... 1
1.2 Other Definitional Provisions............................... 11
SECTION 2. AMOUNT AND TERMS OF THE COMMITMENTS......................... 11
2.1 The Commitments............................................. 11
2.2 Procedure for Borrowing..................................... 11
2.3 Repayment of Outstanding Loans.............................. 12
2.4 Evidence of Debt............................................ 12
2.5 Prepayments................................................. 13
2.6 Minimum Amount of Eurodollar Tranches....................... 13
2.7 Interest Rate and Payment Dates............................. 13
2.8 Mandatory Repayments........................................ 14
2.9 Conversion and Continuation Options......................... 14
2.10 Computation of Interest.................................... 14
2.11 Inability to Determine Eurodollar Rate..................... 15
2.12 Pro Rata Treatment and Payments............................ 15
2.13 Increased Costs............................................ 16
2.14 Transfer of Eurodollar Loans............................... 17
2.15 Indemnity.................................................. 17
2.16 Taxes...................................................... 18
2.17 Transferred Commitment..................................... 19
2.18 Use of Proceeds............................................ 19
SECTION 3. REPRESENTATIONS AND WARRANTIES.............................. 19
3.1 Financial Condition......................................... 19
3.2 No Change................................................... 20
3.3 Corporate Existence......................................... 20
3.4 Corporate Authorization; No Violation....................... 20
3.5 Government Authorization.................................... 20
3.6 Federal Regulations......................................... 20
3.7 Enforceable Obligations..................................... 20
3.8 No Material Litigation...................................... 21
3.9 Taxes....................................................... 21
3.10 ERISA...................................................... 21
3.11 Investment Company Act; Other Regulations.................. 21
3.12 Existing Financial Covenants............................... 21
SECTION 4. CONDITIONS PRECEDENT ....................................... 21
4.1 Conditions to Effectiveness. .............................. 21
4.2 Conditions to All Loans..................................... 22
(a) Representations and Warranties....................... 22
(b) No Default or Event of Default....................... 22
SECTION 5. AFFIRMATIVE COVENANTS....................................... 22
5.1 Financial Statements, etc................................... 23
-i-
Page
5.2 Maintenance of Existence.................................... 23
5.3 Notices..................................................... 24
SECTION 6. NEGATIVE COVENANTS.......................................... 24
6.1 Debt to Equity Ratio........................................ 24
6.2 Limitation on Transactions with Affiliates.................. 24
6.3 Limitation on Fundamental Change............................ 24
6.4 Limitation on Liens......................................... 24
6.5 Additional Covenants........................................ 26
SECTION 7. EVENTS OF DEFAULT........................................... 27
SECTION 8. THE AGENT................................................... 29
8.1 Appointment................................................. 29
8.2 Delegation of Duties........................................ 29
8.3 Exculpatory Provisions...................................... 29
8.4 Reliance by Agent and CASC.................................. 30
8.5 Notice of Default........................................... 30
8.6 Non-Reliance on Agent, Other Banks and CASC................. 30
8.7 Indemnification............................................. 31
8.8 Agent in its Individual Capacity............................ 31
8.9 Successor Agent............................................. 31
SECTION 9. MISCELLANEOUS............................................... 31
9.1 Amendments and Waivers...................................... 31
9.2 Notices..................................................... 32
9.3 Clearing Accounts........................................... 33
9.4 No Waiver; Cumulative Remedies.............................. 33
9.5 Survival of Representations and Warranties.................. 34
9.6 Payment of Expenses......................................... 34
9.7 Successors and Assigns; Participations and Assignments...... 34
9.8 Right of Set-off............................................ 36
9.9 Adjustments................................................. 36
9.10 New Banks.................................................. 36
9.11 Increase in Commitments.................................... 37
9.12 Tax Forms.................................................. 37
9.13 Counterparts............................................... 37
9.14 Governing Law.............................................. 38
9.15 Submission to Jurisdiction; Waivers........................ 38
9.16 Integration................................................ 38
9.17 Restatement................................................ 38
9.18 WAIVERS OF JURY TRIAL..................................... 39
-ii-
SCHEDULES
- ---------
Schedule I Banks
Schedule II Existing Financial Covenants
EXHIBITS
- --------
Exhibit A-1 Form of Opinion of Simpson Thacher & Bartlett
Exhibit A-2 Form of Opinion of General Counsel
Exhibit B Form of New Bank Supplement
Exhibit C Form of Addendum
Exhibit D Form of Closing Certificate
Exhibit E Form of Note
-iii-
FIFTH AMENDED AND RESTATED COMMITMENT TRANSFER AGREEMENT dated
as of May 1, 1995 among CHRYSLER FINANCIAL CORPORATION, a Michigan corporation
(the "Company"), the several financial institutions parties to this Agreement
(collectively, the "Banks"; individually, a "Bank") and CHEMICAL BANK, a New
York banking corporation ("Chemical"), as agent for the Banks.
W I T N E S S E T H :
WHEREAS, the Company, the Agent and the several financial
institutions parties thereto (the "Original Banks") entered into a Revolving
Credit Agreement dated as of November 15, 1987, as amended by Amendments dated
as of February 4, 1988 and September 1, 1989 (the "Original Credit
Agreement"), pursuant to which the Original Banks agreed to make loans to the
Company for its general corporate purposes;
WHEREAS, the Company and the Banks entered into an Amended and
Restated Commitment Transfer Agreement dated as of December 31, 1989 (as
amended, the "Amended and Restated Commitment Transfer Agreement") for the
purpose of making certain amendments to the Original Credit Agreement;
WHEREAS, the Company and the Banks entered into a Second
Amended and Restated Commitment Transfer Agreement dated as of July 29, 1992
(as amended, the "Second Amended and Restated Commitment Transfer Agreement")
for the purpose of making certain amendments to the Amended and Restated
Commitment Transfer Agreement;
WHEREAS, the Company and the Banks entered into a Third Amended
and Restated Commitment Transfer Agreement dated as of June 30, 1993 (as
amended through the date hereof, the "Third Amended and Restated Commitment
Transfer Agreement") for the purpose of making certain amendments to the
Second Amended and Restated Commitment Transfer Agreement;
WHEREAS, the Company and the Banks entered into a Fourth
Amended and Restated Commitment Transfer Agreement dated as of May 23, 1994
(as amended through the date hereof, the "Fourth Amended and Restated
Commitment Transfer Agreement") for the purpose of making certain amendments
to the Third Amended and Restated Commitment Transfer Agreement; and
WHEREAS, the Company has requested that the Banks enter into
this Fifth Amended and Restated Commitment Transfer Agreement for the purpose
of making certain amendments to the Fourth Amended and Restated Commitment
Transfer Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree that from and after the
Effective Date (as hereinafter defined) the Fourth Amended and Restated
Commitment Transfer Agreement shall be amended and restated in its entirety as
follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms defined
in the caption to this Agreement shall have the meanings set forth therein and
the following terms have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
2
"Accumulated Funding Deficiency" shall mean any "accumulated
funding deficiency" as defined in Section 302 of ERISA.
"ACH" shall mean an Automated Clearing House.
"Addendum" shall mean an instrument, substantially in the form
of Exhibit C, by which a Bank becomes a party to this Agreement.
"Affected Bank" shall have the meaning set forth in subsection
2.13.
"Affiliate" of any Person, shall mean any other Person that,
directly or indirectly, controls or is controlled by or is under
common control with such Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlled
by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies
of such Person, whether through the ownership of voting securities or
by contract or otherwise.
"Agent" shall mean Chemical Bank and its affiliates, in their
respective capacities as administrative agent for the Banks under this
Agreement and arranger of the Commitments, together with any of their
respective successors.
"Agreement" shall mean this Fifth Amended and Restated
Commitment Transfer Agreement, as the same may be amended, modified or
supplemented from time to time.
"Applicable Margin" shall mean, with respect to each Eurodollar
Loan at any date, the applicable percentage per annum set forth below
based upon the Status and Utilization on such date (provided that if
the Commitments have been terminated prior to such date, the
Utilization for such date shall be deemed to be greater than 50%):
Level I Level II Level III Level IV Level V
Utilization Status Status Status Status Status
- ----------- ------- -------- --------- -------- -------
Less than or equal to
50%: 0.2500% 0.2500% 0.3000% 0.3750% 0.5000%
Greater than 50%: 0.3750% 0.3750% 0.4250% 0.5000% 0.6250%
"Assessment Rate" shall mean for any date the annual rate
(rounded upwards, if necessary, to the next 1/100 of 1%) most recently
estimated by the Agent as the then current net annual assessment rate
that will be employed in determining amounts payable by Chemical to
the Federal Deposit Insurance Corporation (or any successor) for
insurance by such Corporation (or any successor) of time deposits made
in Dollars at Chemical's domestic offices.
"Available Transferred Commitment" shall mean, as to any Bank,
at a particular time, an amount equal to the excess, if any, of (a)
the amount of such Bank's Commitment at such time over (b) the
aggregate unpaid principal amount at such time of all Loans made by
such Bank pursuant to subsection 2.1; collectively, as to all the
Banks, the "Available Transferred Commitments".
3
"Base Rate" shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/100 of 1%) equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Base CD Rate in
effect on such day plus 1% and (c) the Effective Federal Funds Rate in
effect on such day plus 1/2 of 1%. For purposes hereof, "Prime Rate"
shall mean the rate of interest per annum publicly announced from time
to time by Chemical as its prime rate in effect at its principal
office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced; "Base CD
Rate" shall mean the sum of (a) the product of (i) the Three-Month
Secondary CD Rate and (ii) Statutory Reserves and (b) the Assessment
Rate; and "Three-Month Secondary CD Rate" shall mean, for any day, the
secondary market rate for three-month certificates of deposit reported
as being in effect on such day (or, if such day shall not be a
Business Day, the next preceding Business Day) by the Federal Reserve
Board through the public information telephone line of the Federal
Reserve Bank of New York (which rate will, under the current practices
of the Federal Reserve Board, be published in Federal Reserve
Statistical Release H.15(519) during the week following such day), or,
if such rate shall not be so reported for such day or such next
preceding Business Day, the average of the secondary market quotations
for three-month certificates of deposit of major money center banks in
New York City received at approximately 10:00 a.m., New York City
time, on such day (or, if such day shall not be a Business Day, on the
next preceding Business Day) by the Agent from three New York City
negotiable certificate of deposit dealers of recognized standing
selected by it. If for any reason the Agent shall have determined
(which determination shall be conclusive absent clearly demonstrable
error) that it is unable to ascertain the Base CD Rate or the
Effective Federal Funds Rate or both for any reason, including the
inability or failure of the Agent to obtain sufficient quotations in
accordance with the terms thereof, the Base Rate shall be determined
without regard to clause (b) or (c), or both, of the first sentence of
this definition, as appropriate, until the circumstances giving rise
to such inability no longer exist. Any change in the Base Rate due to
a change in the Prime Rate, the Three-Month Secondary CD Rate or the
Effective Federal Funds Rate shall be effective on the effective date
of such change in the Prime Rate, the Three-Month Secondary CD Rate or
the Effective Federal Funds Rate, respectively.
"Base Rate Loans" shall mean Loans hereunder at such time as
they bear interest at a rate based upon the Base Rate.
"Borrowing Date" shall mean any Business Day specified in a
notice pursuant to subsection 2.2 as a date on which the Company
requests the Banks to make Loans hereunder.
"Business Day" shall mean a day other than a Saturday, Sunday
or other day on which commercial banks in New York City are authorized
or required by law to close, except that, when used in connection with
a Eurodollar Loan with respect to which the Eurodollar Rate is
determined based upon the Telerate screen in accordance with the
definition of Eurodollar Rate, "Business Day" shall mean any Business
Day on which dealings in foreign currencies and exchange between banks
may be carried on in London, England and New York, New York.
"Capital Stock" shall mean any and all shares, interests,
participations or other equivalents (however designated) of capital
stock of a corporation, any and all equivalent ownership interests in
a Person (other than a corporation) and any and all warrants or
options to purchase any of the foregoing.
"CASC" shall mean Chemical Bank Agency Services (and any
successor).
4
"CFC Affiliate" shall mean any Person that, directly or
indirectly, controls or is controlled by or is under common control
with the Company (including, without limitation, Chrysler and its
subsidiaries, but excluding any Subsidiary). For the purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect
to any Person, shall mean the power, directly or indirectly, either to
(a) vote 20% or more of the securities (or other equity interests) of
such Person having ordinary voting power or (b) direct or cause the
direction of the management and policies of such Person, whether
through the ownership of voting securities (or other equity interests)
or by contract or otherwise.
"Change of Control" shall mean any of the following events or
circumstances: (a) any Person or "group" (within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended) shall either (i) acquire beneficial ownership of more than
50% of any outstanding class of common stock of Chrysler having
ordinary voting power in the election of directors of Chrysler or (ii)
obtain the power (whether or not exercised) to elect a majority of
Chrysler's directors or (b) the Board of Directors of Chrysler shall
not consist of a majority of Continuing Directors. As used in this
definition, "Continuing Directors" shall mean the directors of
Chrysler on the Effective Date and each other director of Chrysler, if
such other director's nomination for election to the Board of
Directors of Chrysler is recommended by a majority of the then
Continuing Directors.
"Chrysler" shall mean Chrysler Corporation, a Delaware
corporation.
"Chrysler Agreement" shall mean the Revolving Credit Agreement
dated as of July 29, 1994 among Chrysler Corporation, the banks
parties thereto and Chemical Bank as agent for such banks, as the same
may be amended, modified or supplemented from time to time.
"Clearing Account" shall mean, as to any Bank, the bank account
designated in its Addendum, or such other bank account as such Bank
shall designate in writing to the Agent from time to time, provided
that such other bank account shall be maintained at the office of an
ACH member.
"Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"Commitment" shall mean, as to any Bank, its obligation to make
Loans to the Company pursuant to subsection 2.1 in the amount referred
to therein, as such amount may be determined from time to time
pursuant to subsection 2.17; collectively, as to all the Banks, the
"Commitments".
"Commitment Percentage" shall mean, as to any Bank at any time,
the percentage of the aggregate Commitments then constituted by such
Bank's Commitment.
"Commitment Period" shall mean the period from and including
the Effective Date (or, in the case of an assignee that is not already
a Bank and any New Bank, from the date that such Person becomes party
to this Agreement as provided in subsection 9.7 or 9.10, as
applicable) to but not including the Termination Date or such earlier
date as the Commitments shall terminate as provided herein.
5
"Commonly Controlled Entity" shall mean an entity, whether or
not incorporated, which is under common control with the Company
within the meaning of Section 4001 of ERISA or is part of a group
which includes the Company and is treated as a single employer under
Section 414 of the Code.
"Contractual Obligation" shall mean, as to any Person, any
enforceable provision of any security issued by such Person or of any
agreement, instrument or undertaking to which such Person is a party
or by which it or any of its property is bound.
"D&P" shall mean Duff & Phelps Credit Rating Company and its
successors.
"Debt" shall mean, at any date, the amount which would appear
in accordance with GAAP on a consolidated balance sheet of the Company
and its Subsidiaries on such date opposite the heading "debt" (or any
similar item).
"Default" shall mean any of the events specified in Section 7,
whether or not any requirement for the giving of notice, lapse of
time, or both, or the happening of any other condition, has been
satisfied.
"Dollars" or "$" shall mean lawful currency of the United
States of America.
"Domestic Subsidiary" shall mean any Subsidiary other than a
Foreign Subsidiary.
"Effective Date" shall mean, subject to satisfaction of the
conditions specified in subsection 4.1, May 5, 1995.
"Effective Federal Funds Rate" shall mean, for any day, the
weighted average of the rates on overnight Federal funds transactions
between members of the Federal Reserve System arranged by Federal
funds brokers, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average quotations for the day
of such transactions received by the Agent from three Federal funds
brokers of recognized standing selected by it.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"Equity" shall mean, at any date, the amount which would appear
in accordance with GAAP on a consolidated balance sheet of the Company
and its Subsidiaries on such date opposite the heading "total
shareholders' investment" (or any similar item).
"Eurodollar Loan" shall mean any Loan bearing interest at a
rate determined by reference to the Eurodollar Rate.
"Eurodollar Rate" shall mean, in the case of any Eurodollar
Loan, with respect to each day during each Interest Period (other than
any seven-day Interest Period) pertaining to such Eurodollar Loan, the
rate of interest determined on the basis of the rate for deposits in
Dollars for a period equal to such Interest Period commencing on the
first day of such Interest Period appearing on Page 3750 of the
Telerate screen as of 11:00 A.M., London time, two Business Days prior
to the beginning of such Interest Period, provided, that in the event
that such rate does not appear on Page 3750 of the Telerate Service
(or otherwise on such service), the "Eurodollar Rate" shall be
determined by reference to such other publicly available service for
6
displaying eurodollar rates as may be agreed upon by the Agent and the
Company. In the absence of such agreement, and in the case of any
seven-day Interest Period pertaining to such Eurodollar Loan, the
"Eurodollar Rate" shall instead be the rate per annum equal to the
average (rounded upward, if necessary, to the nearest 1/100th of 1%)
of the respective rates notified to the Agent by each of the Reference
Banks as the rate at which such Reference Bank is offered Dollar
deposits at or about 10:00 A.M., New York City time, two Business Days
prior to the beginning of the relevant Interest Period, in the
interbank eurodollar market where the eurodollar and foreign currency
and exchange operations in respect of its Eurodollar Loans are then
being conducted for delivery on the first day of such Interest Period
for the number of days comprised therein and in an amount comparable
to the amount of its Eurodollar Loan to be outstanding during such
Interest Period.
"Eurodollar Tranche" shall mean and be a collective reference
to Eurodollar Loans having the same Interest Period, whether or not
originally made on the same day.
"Event of Default" shall mean any of the events specified in
Section 7, provided that any requirement for the giving of notice, the
lapse of time, or both, or the happening of any other condition, has
been satisfied.
"Excess Utilization Period" shall mean any Utilization Period
with respect to which the Utilization exceeds 50%.
"Federal Reserve Board" shall mean the Board of Governors of
the Federal Reserve System of the United States.
"Final Date" shall mean the later of (a) the last day of the
Commitment Period and (b) the date on which all of the Loans shall
have been paid in full.
"Finance Business" shall mean (a) the small loan, personal
finance, consumer finance or installment credit business (including
the business of making collateral loans secured by credit obligations
or personal property), (b) the sales finance business and the business
of purchasing and selling notes and accounts receivable (whether or
not repayable in installments) and interests therein, (c) the
commercial financing and factoring business as generally conducted,
including the leasing of tangible personal property, and (d) any
business (including, without limitation, securitization and other
receivables-based transactions) related to or conducted in connection
with any business of the character referred to in the foregoing
clauses (a), (b) and (c) other than insurance underwriting.
"Finance-Related Insurance Business" shall mean the business of
(a) insuring articles and merchandise the sale or leasing of which is
financed in the ordinary course of the Finance Business, (b) insuring
the lives of individuals who are liable for the payment of the amounts
owing on such sales or leases and writing accident and health
insurance on such individuals, (c) automobile dealership property,
liability, workers compensation and related insurance, (d) motor
vehicle physical damage and liability insurance, and such other
insurance business that is not described in clause (a), (b), (c) or
(d) above to the extent that such insurance business does not produce
at any time aggregate premiums written (net of reinsurance ceded) by
all Subsidiaries in an amount greater than 50% of the aggregate amount
of all premiums written (net of reinsurance ceded) at such time in all
of the insurance business of such Subsidiaries.
"Finance Subsidiary" shall mean any Domestic Subsidiary that is
engaged primarily in the Finance Business.
7
"Fitch" shall mean Fitch Investors Service, Inc. and its
successors.
"Foreign Subsidiary" shall mean any Subsidiary that (a) is
organized under the laws of any jurisdiction outside the United States
of America, Puerto Rico and Canada, or (b) conducts the major portion
of its business outside the United States of America, Puerto Rico and
Canada.
"GAAP" shall mean generally accepted accounting principles in
the United States of America in effect from time to time, except that
for the purposes of determining compliance with the covenants set
forth in Section 6, "GAAP" shall mean generally accepted accounting
principles in the United States of America in effect on December 31,
1994 applied consistently with those used in compiling the financial
statements included in the 1994 Annual Report.
"Governmental Authority" shall mean any nation or government,
any state or other political subdivision thereof, and any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Indebtedness" shall mean, as applied to any Person, at any
date, (a) indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services which would appear on
a consolidated balance sheet of such Person (or, in the case of the
Company and its Subsidiaries, the Company) prepared in accordance with
GAAP, (b) obligations of such Person under leases which appear as
capital leases on a consolidated balance sheet of such Person prepared
in accordance with GAAP and (c) any withdrawal obligation of such
Person or any Commonly Controlled Entity thereof to a Multiemployer
Plan.
"Interest Period" shall mean with respect to any Eurodollar
Tranche:
(i) initially, the period commencing on the
borrowing or conversion date, as the case may be, with respect
to such Eurodollar Tranche and ending seven days or one, two,
three or six months thereafter, as selected by the Company in
its notice of borrowing or notice of conversion, as the case
may be, given with respect thereto; and
(ii) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable to
such Eurodollar Tranche and ending seven days or one, two,
three or six months thereafter, as selected by the Company by
irrevocable notice to the Agent not less than three Business
Days prior to the last day of the then current Interest Period
with respect thereto (or, if no such period is specified,
ending one month thereafter);
provided that, the foregoing provisions are subject to the following:
(A) if any Interest Period would otherwise end on
a day which is not a Business Day, such Interest Period
shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry
such Interest Period into another calendar month, in
which event such Interest Period shall end on the
immediately preceding Business Day;
(B) no Interest Period may be selected by the
Company if such Interest Period would end after the
Termination Date; and
8
(C) any Interest Period of at least one month's
duration that begins on the last Business Day of a
calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of the relevant calendar month.
"Level" shall mean any of Level I, Level II, Level III, Level
IV or Level V.
"Level I" shall mean any of the following long-term senior
unsecured debt ratings: A+ or better by S&P, A1 or better by Moody's,
A+ or better by D&P or A+ or better by Fitch.
"Level II" shall mean any of the following long-term senior
unsecured debt ratings: A or A- by S&P, A2 or A3 by Moody's, A or A-
by D&P or A or A- by Fitch.
"Level III" shall mean any of the following long-term senior
unsecured debt ratings: BBB+ or BBB by S&P, Baa1 or Baa2 by Moody's,
BBB+ or BBB by D&P or BBB+ or BBB by Fitch.
"Level IV" shall mean any of the following long-term senior
unsecured debt ratings: BBB- by S&P, Baa3 by Moody's, BBB- by D&P or
BBB- by Fitch.
"Level V" shall mean any of the following long-term senior
unsecured debt ratings: BB+ or lower (or unrated) by S&P, Ba1 or lower
(or unrated) by Moody's, BB+ or lower (or unrated) by D&P or BB+ or
lower (or unrated) by Fitch.
"Lien" shall mean, with respect to any property of any Person,
any mortgage, pledge, hypothecation, encumbrance, lien (statutory or
other), charge or other security interest of any kind in or with
respect to such property (including, without limitation, any
conditional sale or other title retention agreement, and any financing
lease under which such Person is lessee having substantially the same
economic effect as any of the foregoing).
"Loan" shall have the meaning set forth in subsection 2.1(a).
"Long Term Revolving Credit Agreement" shall mean (i) the Long
Term Revolving Credit Agreement, dated as of May 1, 1995, among the
Company, Chrysler Credit Canada Ltd., the financial institutions from
time to time parties thereto, the Managing Agents parties thereto,
Royal Bank of Canada, as Canadian administrative agent, and Chemical
Bank, as administrative agent, as amended, supplemented, or otherwise
modified from time to time, or (ii) if such Revolving Credit Agreement
is refinanced, refunded or otherwise replaced by another bank
revolving credit agreement, such agreement, as amended, supplemented
or otherwise modified from time to time.
"Material Indebtedness" shall mean any item or related items of
Indebtedness (or, in the case of any revolving credit facility, any
commitments) having an aggregate principal amount of at least
$100,000,000 (or the equivalent thereof in any other currency).
"Moody's" shall mean Moody's Investors Service, Inc. and its
successors.
"Multiemployer Plan" shall mean a Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
9
"New Bank" shall have the meaning set forth in subsection 9.10.
"1994 Annual Report" shall mean the Company's annual report to
stockholders for the fiscal year ended December 31, 1994.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA or any
successor corporation.
"Person" shall mean and include an individual, a partnership, a
corporation (including a business trust), a joint stock company, a
trust, an unincorporated association, a joint venture or other entity
or a government or any agency or political subdivision thereof.
"Plan" shall mean any pension plan which is covered by Title IV
of ERISA and in respect of which the Company or a Commonly Controlled
Entity is an "employer" as defined in Section 3(5) of ERISA.
"Prohibited Transaction" shall mean any "prohibited
transaction" as defined in Section 406 of ERISA or Section 4975 of the
Code.
"Rating Agencies" shall mean the collective reference to D&P,
Fitch, Moody's and S&P.
"Real Estate Business" shall mean the acquisition, development,
leasing, financing, management, maintenance and disposition of real
property, including, without limitation, automotive dealership
facilities and dealership site control arrangements.
"Reference Banks" shall mean Chemical, Royal Bank of Canada and
Swiss Bank Corporation; provided, that, for the purposes of
determining the Eurodollar Rate with respect to any seven-day Interest
Period, Chemical shall be the sole Reference Bank.
"Reportable Event" shall mean any of the events set forth in
Section 4043(b) of ERISA or the regulations thereunder.
"Required Banks" shall mean, at any date, Banks having at least
51% of the aggregate amount of the Commitments at such date or, if the
Commitments have been terminated, Banks holding at least 51% of the
outstanding principal amount of the Loans hereunder.
"Requirement of Law" shall mean, as to any Person, the
Certificate of Incorporation and By-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon
such Person or any of its property or to which such Person or any of
its property is subject.
"Responsible Officer" shall mean, at any particular time, the
Chairman of the Board of Directors, the President, the chief financial
officer, the Vice President - Corporate Finance and Development, the
Treasurer or the Controller of the Company.
"S&P" shall mean Standard & Poor's Ratings Group, and its
successors.
"Short Term Revolving Credit Agreement" shall mean (i) the
Short Term Revolving Credit Agreement, dated as of May 1, 1995, among
the Company, Chrysler Credit Canada
10
Ltd., the financial institutions from time to time parties thereto,
the Managing Agents parties thereto, Royal Bank of Canada, as Canadian
administrative agent, and Chemical Bank, as administrative agent, as
amended, supplemented, or otherwise modified from time to time, or
(ii) if such Revolving Credit Agreement is refinanced, refunded or
otherwise replaced by another bank revolving credit agreement, such
agreement, as amended, supplemented or otherwise modified from time to
time.
"Significant Subsidiary" shall mean at the time of any
determination thereof (a) any Finance Subsidiary and (b) any other
Subsidiary the assets of which constitute at least 5% of the
consolidated assets of the Company and its Subsidiaries as stated on
the consolidated financial statements of the Company and its
Subsidiaries for the most recently ended fiscal quarter of the
Company, provided, that the term "Significant Subsidiary" shall not
include any Special Purpose Subsidiary.
"Single Employer Plan" shall mean any Plan which is not a
Multiemployer Plan.
"Special Purpose Subsidiary" shall mean any Subsidiary created
for the sole purpose of purchasing assets from the Company or any
Finance Subsidiary with the intention and for the purpose of using
such assets in a securitization transaction.
"Status" shall mean, as to the Company, the existence of Level
I Status, Level II Status, Level III Status, Level IV Status or Level
V Status, as the case may be. For the purposes of this definition,
"Status" will be set at the lowest Level assigned to the Company by
any Rating Agency, unless only one Rating Agency has assigned such
Level to the Company, in which case the Company's Status will be set
at the second lowest Level assigned to the Company by any Rating
Agency.
"Statutory Reserves" shall mean a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator
of which is the number one minus the aggregate of the maximum
applicable reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established
by the Federal Reserve Board and any other banking authority to which
Chemical is subject with respect to the Base CD Rate (as such term is
used in the definition of "Base Rate"), for new negotiable nonpersonal
time deposits in Dollars of over $100,000 with maturities
approximately equal to three months. Statutory Reserves shall be
adjusted automatically on and as of the effective date of any change
in any reserve percentage.
"Subsidiary" shall mean any corporation of which the Company or
one or more Subsidiaries or the Company and one or more Subsidiaries
shall at the time own shares of any class or classes (however
designated) having voting power for the election of at least a
majority of the members of the board of directors (or other governing
body) of such corporation.
"Termination Date" shall mean as to any Bank the "Termination
Date" as defined in the Chrysler Agreement.
"Transferred Commitment" shall have the meaning set forth in
subsection 2.17.
"Type" shall mean, as to any Loan hereunder, its nature as a
Base Rate Loan or a Eurodollar Loan.
11
"Utilization" shall mean, for any Utilization Period, the
percentage equivalent of a fraction (a) the numerator of which is the
average daily principal amount of Loans outstanding during such
Utilization Period and (b) the denominator of which is the average
daily amount of the aggregate Commitments of all Banks during such
Utilization Period.
"Utilization Period" shall mean (a) each fiscal quarter of the
Company and (b) any portion of a fiscal quarter of the Company ending
on the Final Date.
1.2 Other Definitional Provisions. (a) Unless otherwise
specified, all terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant
hereto.
(b) As used herein, and in any certificate or other document
made or delivered pursuant hereto, accounting terms relating to the Company
and its Subsidiaries not defined in subsection 1.1, and accounting terms
partly defined in subsection 1.1 to the extent not defined, shall have the
respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and section,
subsection, schedule and exhibit references are to this Agreement unless
otherwise specified.
SECTION 2. AMOUNT AND TERMS OF THE COMMITMENTS
2.1 The Commitments. (a) Subject to the terms and conditions
hereof, each Bank severally agrees to make loans ("Loans") to the Company from
time to time during the Commitment Period in an aggregate principal amount at
any one time outstanding not to exceed such Bank's Transferred Commitment at
such time set opposite such Bank's name in the most recent effective notice
delivered by Chrysler pursuant to subsection 2.17 of the Chrysler Agreement.
During the Commitment Period, the Company may use such Commitment by
borrowing, prepaying or repaying the Loans of such Bank, in whole or in part,
and reborrowing, all in accordance with the terms and conditions hereof.
(b) Loans hereunder may be Base Rate Loans or Eurodollar Loans,
or part Base Rate Loans and part Eurodollar Loans, as determined by the
Company and notified to the Agent in accordance with subsection 2.2, provided
that no Eurodollar Loans shall be made after the date which is seven days
prior to the Termination Date.
2.2 Procedure for Borrowing. (a) The Company may borrow under
the Commitments during the Commitment Period on any Business Day, provided
that the Company shall give the Agent irrevocable notice (which notice must be
received by the Agent prior to 10:00 A.M., New York City time, (i) three
Business Days prior to the requested Borrowing Date, if all or any part of the
requested Loans are to be initially Eurodollar Loans, and (ii) one Business
Day prior to the requested Borrowing Date, otherwise) specifying (A) the
amount to be borrowed, (B) the requested Borrowing Date, (C) whether the
borrowing is to be a Eurodollar Loan or a Base Rate Loan or a combination
thereof, and (D) if such borrowing is to be entirely or partly a Eurodollar
Loan, the length of the Interest Period for such Eurodollar Loan. Upon receipt
of such notice, the Agent shall promptly notify each Bank thereof. Not later
than 2:00 P.M., New York City time, on the Borrowing Date specified in such
notice, each Bank shall (subject to subsection 9.3(b)) deposit in its Clearing
Account an amount in immediately available funds equal to the amount of the
Loan to be made by
12
such Bank. The Agent shall, pursuant to subsection 9.3(a), cause such amount
to be withdrawn from each such Clearing Account and shall make the aggregate
amount so withdrawn available to the Company by depositing the proceeds
thereof in the account of the Company with the Agent on the date such Loans
are made for transmittal by the Agent upon the Company's request. Each
borrowing pursuant to the Commitments shall be in an aggregate principal
amount of the lesser of (i) $25,000,000 or an integral multiple of $1,000,000
in excess thereof or (ii) the then Available Transferred Commitments, provided
that, with respect to any borrowing of Eurodollar Loans, after giving effect
thereto, subsection 2.6 shall not have been contravened.
(b) Unless the Agent shall have received notice from a Bank
prior to a Borrowing Date that such Bank will not make available to the Agent
such Bank's ratable portion of such borrowing through such Bank's Clearing
Account, the Agent may assume that such Bank has made such portion available
to the Agent through such Bank's Clearing Account on the date of such
borrowing in accordance with subsection 2.2(a) and the Agent may, in reliance
upon such assumption, make available to the Company on such date a
corresponding amount. If the Agent does, in such circumstances, make available
to the Company such amount, such Bank shall within three Business Days
following such Borrowing Date make such ratable portion available to the
Agent, together with interest thereon for each day from and including such
Borrowing Date that such ratable portion was not made available, to but
excluding the date such Bank makes its share of such borrowing available to
the Agent, at the Effective Federal Funds Rate. If such amount is so made
available, such payment to the Agent shall constitute such Bank's Loan on such
Borrowing Date for all purposes of this Agreement. If such amount is not so
made available to the Agent, then the Agent shall notify the Company of such
failure and on the fourth Business Day following such Borrowing Date, the
Company shall pay to the Agent such ratable portion, together with interest
thereon for each day that the Company had the use of such ratable portion at
the Effective Federal Funds Rate. Nothing contained in this subsection 2.2(b)
shall relieve any Bank which has failed to make available its ratable portion
of any borrowing hereunder from its obligation to do so in accordance with the
terms hereof.
(c) The failure of any Bank to make the Loan to be made by it
on any Borrowing Date shall not relieve any other Bank of its obligation, if
any, hereunder to make its Loan on such Borrowing Date, but no Bank shall be
responsible for the failure of any other Bank to make the Loan to be made by
such other Bank on such Borrowing Date.
2.3 Repayment of Outstanding Loans. The Company shall repay all
outstanding Loans (together with all accrued unpaid interest thereon) on the
Termination Date.
2.4 Evidence of Debt. (a) Each Bank shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Company to the appropriate lending office of such Bank
resulting from each Loan made by such lending office of such Bank from time to
time, including the amounts of principal and interest payable and paid to such
lending office of such Bank from time to time under this Agreement.
(b) The Agent shall maintain the Register pursuant to
subsection 9.7(f), and a subaccount for each Bank, in which Register and
subaccounts (taken together) shall be recorded (i) the amount of each Loan
made hereunder, the Type of each Loan made and the Interest Period (if any)
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Company to each Bank hereunder
and (iii) the amount of any sum received by the Agent hereunder from the
Company and each Bank's share thereof.
(c) The entries made in the Register and accounts maintained
pursuant to paragraphs (a) and (b) of this subsection 2.4 shall, to the extent
permitted by applicable law, be prima facie
13
evidence of the existence and amounts of the obligations of the Company
therein recorded; provided, however, that the failure of any Bank or the Agent
to maintain such account, such Register or such subaccount, as applicable, or
any error therein, shall not in any manner affect the obligation of the
Company to repay (with applicable interest) the Loans made to the Company by
such Bank in accordance with the terms of this Agreement.
2.5 Prepayments. The Company may, at any time and from time to
time, prepay the Loans hereunder, in whole or in part, without premium or
penalty, upon prior notice to the Agent (which notice must be received by the
Agent prior to 10:00 A.M., New York City time, (i) three Business Days prior
to the repayment date in the case of Eurodollar Loans and (ii) one Business
Day prior to the repayment date otherwise) specifying the date and amount of
prepayment, and whether the prepayment is of Eurodollar Loans, Base Rate Loans
or a combination thereof, and, if a combination thereof, the amount allocable
to each, provided that, each prepayment of Eurodollar Loans on a day other
than the last day of the related Interest Period shall require the payment of
any amounts payable by the Company pursuant to subsection 2.15. Upon receipt
of any such notice, the Agent shall promptly notify each Bank thereof. Any
such notice shall be irrevocable and the payment amount specified in such
notice shall be due and payable on the date specified, together with accrued
interest to such date on the amount prepaid. Partial prepayments shall be in
an aggregate principal amount of $25,000,000 or a multiple of $1,000,000 in
excess thereof, and after giving effect thereto subsection 2.6 shall not have
been contravened.
2.6 Minimum Amount of Eurodollar Tranches. All borrowings,
payments, prepayments, continuations and conversions hereunder shall be in
such amounts and be made pursuant to such elections so that, after giving
effect thereto, the aggregate principal amount of the Eurodollar Loans
comprising any Eurodollar Tranche shall not be less than $50,000,000.
2.7 Interest Rate and Payment Dates. (a) Each Eurodollar Loan
shall bear interest for each day during each Interest Period therefor on the
unpaid principal amount thereof at a rate per annum equal to the Eurodollar
Rate determined for such Interest Period in accordance with the terms hereof
plus the Applicable Margin.
(b) The Base Rate Loans shall bear interest for each day on the
unpaid principal amount thereof, at a rate per annum equal to the Base Rate
determined for such day.
(c) If all or a portion of (i) the principal amount of any
Loan, (ii) any interest payable thereon or (iii) any other amount payable
hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate
per annum which is (x) in the case of overdue principal, the rate that would
otherwise be applicable thereto pursuant to the foregoing provisions of this
subsection 2.7 plus 1% or (y) in the case of any overdue interest or other
amount, the rate described in subsection 2.7(b) plus 1%, in each case from the
date of such non-payment to (but excluding) the date on which such amount is
paid in full (as well after as before judgment).
(d) Interest shall be payable in arrears (i) with respect to
Eurodollar Loans having an Interest Period of three months or less, on the
last day of such Interest Period, (ii) with respect to Eurodollar Loans having
an Interest Period longer than three months, on each day which is three
months, or a whole multiple thereof, after the first day of such Interest
Period and the last day of such Interest Period, (iii) with respect to Base
Rate Loans, on the last day of each March, June, September and December, and
(iv) with respect to all Loans, upon each repayment, prepayment or conversion
thereof; provided that interest accruing pursuant to paragraph (c) of this
subsection shall be payable on demand. The amount of interest on any
Eurodollar Loans to be paid on any date as specified above
14
shall in each case be determined under the assumption that the Utilization for
the Utilization Period(s) during which such interest accrued was less than
50%. On the first Business Day following the last day of each Excess
Utilization Period, the Company shall pay to the Agent, for the benefit of the
Banks, an additional amount of interest equal to the excess (if any) of (i)
the amount of interest which accrued during such Utilization Period after
giving effect to the actual Utilization for such Utilization Period (whether
or not such accrued interest was actually payable during such Utilization
Period) over (ii) the amount of interest which would have accrued during such
Utilization Period if the Utilization during such Utilization Period had been
less than 50%.
2.8 Mandatory Repayments. The Company, without notice or
demand, shall immediately repay the Loans hereunder to the extent that the
aggregate amount thereof exceeds the Commitments from time to time in effect.
2.9 Conversion and Continuation Options. (a) The Company may
elect from time to time to convert Eurodollar Loans to Base Rate Loans, by
giving the Agent at least two Business Days' prior irrevocable notice of such
election, provided that any such conversion of Eurodollar Loans may only be
made on the last day of an Interest Period with respect thereto. The Company
may elect from time to time to convert Base Rate Loans to Eurodollar Loans by
giving the Agent at least three Business Days' prior irrevocable notice of
such election. Any such notice of conversion to Eurodollar Loans shall specify
the length of the initial Interest Period or Interest Periods therefor. Upon
receipt of any such notice the Agent shall promptly notify each Bank thereof.
All or any part of outstanding Eurodollar Loans and Base Rate Loans may be
converted as provided herein, provided that (i) no Base Rate Loan may be
converted into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Agent has or the Required Banks have determined in its or
their sole discretion that such conversion is not appropriate, (ii) any such
conversion may only be made if, after giving effect thereto, subsection 2.6
shall not have been contravened and (iii) no Base Rate Loan may be converted
into a Eurodollar Loan after the date that is seven days prior to the
Termination Date.
(b) Any Eurodollar Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Company giving irrevocable notice to the Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in subsection
1.1, of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan may be continued as such (i) when any Event
of Default has occurred and is continuing and the Agent has or the Required
Banks have determined in its or their sole discretion that such continuation
is not appropriate, (ii) if, after giving effect thereto, subsection 2.6 would
be contravened or (iii) after the date that is seven days prior to the
Termination Date and provided, further, that if the Company shall fail to give
any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso such Loans
shall be automatically converted to Base Rate Loans on the last day of such
then expiring Interest Period. Upon receipt of any notice given by the Company
pursuant to this subsection 2.9(b), the Agent shall promptly notify each Bank
thereof.
2.10 Computation of Interest. (a) Interest (other than interest
calculated on the basis of the Prime Rate) shall be calculated on the basis of
a 360-day year, for the actual days elapsed. Interest calculated on the basis
of the Prime Rate shall be calculated on the basis of a 365- (or 366-, as the
case may be) day year for the actual days elapsed. The Agent shall, as soon as
practicable, notify the Company and the Banks of each determination of the
Eurodollar Rate with respect to Eurodollar Loans. Any change in the interest
rate in respect of a Loan resulting from a change in the Base Rate or the
Applicable Margin shall become effective as of the opening of business on the
day on which a change in the Base Rate shall become effective or such
Applicable Margin changes as provided herein, as the case may be. The Agent
shall notify the Company and the Banks of the effective date and the amount of
each such change in the Base Rate.
15
(b) Each determination, pursuant to and in accordance with any
provision of this Agreement, of an interest rate applicable to a Eurodollar
Loan for any Interest Period by the Agent, and each determination by a
Reference Bank of a rate with respect to a Eurodollar Loan for any Interest
Period to be notified to the Agent pursuant to the definition of "Eurodollar
Rate" shall be conclusive and binding on the Company and the Banks in the
absence of manifest error. The Agent shall, at the request of the Company,
deliver to the Company a statement showing any quotations given by the
Reference Banks and the computations used by the Agent in determining any
interest rate pursuant to subsection 2.7(a).
(c) If any Reference Bank's Commitment shall terminate
(otherwise than on termination of all the Commitments), or, as the case may
be, Loans made by it hereunder are assigned, or prepaid or repaid (otherwise
than on the ratable prepayment or repayment of the Loans among the Banks) for
any reason whatsoever, such Reference Bank shall thereupon cease to be a
Reference Bank and, if as a result of the foregoing, there shall be only one
Reference Bank remaining, then the Agent (after consultation with the Company
and the Banks) shall, as soon as practicable thereafter, by notice to the
Company and the Banks, designate another Bank that is willing to act as a
Reference Bank so that there shall at all times be at least two Reference
Banks. In acting to so designate another Bank to serve as a Reference Bank,
the Agent will use its best efforts to ensure that one Reference Bank will, at
all times, be a Bank that has its headquarters office located outside the
United States.
(d) If any of the Reference Banks shall be unable or shall
otherwise fail to provide notice of a rate to the Agent upon its request with
respect to a Eurodollar Loan, the Eurodollar Rate shall be determined on the
basis of rates provided in notices of the remaining Reference Banks.
2.11 Inability to Determine Eurodollar Rate. In the event that
(a) the Agent determines (which determination shall be conclusive and binding
upon the Company) that by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate in respect of any Eurodollar Loans, or (b) the Required Banks
determine (which determination shall be conclusive and binding upon the
Company) and shall notify the Agent that the rates of interest referred to in
the definition of "Eurodollar Rate" as the basis upon which the rate of
interest for Eurodollar Loans is to be determined do not adequately cover the
cost to the Banks of making or maintaining Eurodollar Loans, in each case with
respect to any proposed Loan that the Company has requested to be made as a
Eurodollar Loan, the Agent shall forthwith give facsimile transmission or
other written notice of such determination to the Company and the Banks at
least one Business Day prior to the requested Borrowing Date for such
Eurodollar Loan. If such notice is given, any requested borrowing of a
Eurodollar Loan shall be made as a Base Rate Loan. Until such notice has been
withdrawn by the Agent, no further Eurodollar Loans shall be made.
2.12 Pro Rata Treatment and Payments. (a) Each borrowing by the
Company from the Banks and any reduction of the amount of the Commitments of
the Banks hereunder (except for the reduction or termination of a particular
Bank's Commitment pursuant to subsection 2.16) shall be made pro rata
according to the amounts of the then existing Commitments. Each payment
(including each prepayment) by the Company on account of principal and
interest (except for payments to a particular Bank pursuant to subsection
2.13, 2.15, or 2.16), shall be made on a pro rata basis according to the
amounts of the then outstanding Loans of the Banks hereunder. All payments
(including prepayments) by the Company shall be made without setoff or
counterclaim to the Agent for the account of the Banks at the office of the
Agent referred to in subsection 9.2 in Dollars and in immediately available
funds. The Agent shall promptly distribute such payments to each Bank entitled
to receive a portion thereof by causing such Bank's portion of such payment to
be deposited in such Bank's Clearing Account. If any payment hereunder (other
than a payment in respect of a Eurodollar Loan) becomes due and payable on a
day other than a Business Day, the maturity thereof shall be
16
extended to the next succeeding Business Day. If any payment on a Eurodollar
Loan becomes due and payable on a day other than a Business Day, the maturity
thereof shall be extended to the next succeeding Business Day unless the
result of such extension would be to extend such payment into another calendar
month in which event such payment shall be made on the immediately preceding
Business Day. In the case of any extension of any payment of principal
pursuant to the preceding two sentences, interest thereon shall be payable at
the then applicable rate during such extension.
(b) Unless the Agent shall have received notice from the
Company prior to the date on which any payment is due to the Banks hereunder
that the Company will not make such payment in full, the Agent may assume that
the Company has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Bank on such due date an amount equal to the amount then due to such Bank. If
and to the extent the Company shall not have so made such payment in full to
the Agent, each Bank shall repay to the Agent forthwith on demand such amount
distributed to such Bank together with interest thereon, for each day from and
including the date such amount is distributed to such Bank to but excluding
the date such Bank repays such amount to the Agent at the Effective Federal
Funds Rate for each such day. Nothing contained in this subsection 2.12(b)
shall relieve the Company from its obligations to make payments on all amounts
due hereunder in accordance with the terms hereof.
2.13 Increased Costs. (a) In the event that any law,
regulation, treaty or directive or any change therein or in the interpretation
or application thereof or compliance by any Bank with any request or directive
(whether or not having the force of law) from any central bank or other
Governmental Authority enacted or made subsequent to the date hereof:
(i) does or shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement
against assets held by, or deposits or other liabilities in or for the
account of, advances or loans by, or other credit extended by, or any
other acquisition of funds by, any office of such Bank; or
(ii) does or shall impose on such Bank any other
condition;
and the result of any of the foregoing is to increase the cost to such Bank of
making, or maintaining advances or extensions of credit or to reduce any
amounts receivable hereunder (such increase in cost or reduction in amounts
receivable, "Increased Costs") then, in any such case, the Company shall
promptly pay to the Agent for the account of such Bank, upon the written
demand of such Bank to the Company (with a copy to the Agent), so long as such
Increased Costs are not otherwise included in the amounts required to be paid
to such Bank pursuant to subsection 2.13(b), 2.15, or 2.16, any additional
amounts necessary to compensate such Bank for such Increased Costs which such
Bank deems to be material as determined by such Bank with respect to its
Eurodollar Loans. If a Bank becomes entitled to claim any additional amounts
pursuant to this subsection 2.13(a), it shall promptly notify the Company,
through the Agent, of the event by reason of which it has become so entitled.
A certificate as to any additional amounts payable pursuant to the foregoing
sentence submitted by a Bank, through the Agent, to the Company shall be
conclusive in the absence of manifest error.
(b) Upon notice from any Affected Bank (as hereinafter
defined), the Company shall pay to the Agent for the account of such Affected
Bank an additional amount for each Eurodollar Loan of such Affected Bank,
payable on the last day of the Interest Period with respect thereto, equal to
17
P x [[R / (1.00 - r)] - R] x [T / 360]
Where P = the principal amount of such Eurodollar Loan of such Bank;
R = the Eurodollar Rate (expressed as a decimal) for such Interest
Period;
T = the number of days in such Interest Period during which such Bank
was an "Affected Bank"; and
r = the aggregate of rates (expressed as a decimal) of reserve
requirements current on the date two Business Days prior to the
beginning of such Interest Period (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any
regulations of the Federal Reserve Board or other Governmental
Authority having jurisdiction with respect thereto, as now and from
time to time hereafter in effect, dealing with reserve requirements
prescribed for eurocurrency funding (currently referred to as
"Eurocurrency liabilities" in Regulation D of the Federal Reserve
Board) maintained by a member bank of the Federal Reserve System.
The term "Affected Bank" shall mean any Bank party to this
Agreement that is (i) organized under the laws of the United States or any
State thereof or (ii) a bank organized under laws other than those of the
United States of America or a State thereof that is funding its Eurodollar
Loans through a branch or agency located in the United States of America. Each
Bank agrees to notify the Agent (A) by appropriate notification on its
Addendum in the case of each original Bank party hereto and (B) in the case of
each New Bank, and each Assignee (as defined in the Chrysler Agreement) that
is not already a Bank, upon its becoming a party hereto, whether or not it is
an Affected Bank, and of any subsequent change of status, disclosing the
effective date of such change.
2.14 Transfer of Eurodollar Loans. Upon the occurrence of any
of the events specified in subsection 2.13(a), each Bank whose Eurodollar
Loans are affected by any such event agrees that it will transfer its
Eurodollar Loans affected by any such event to another branch office (or, if
such Bank so elects, to an affiliate) of such Bank, provided that such
transfer shall be made only if such Bank shall have determined in good faith
(which determination shall, absent manifest error, be final, conclusive and
binding upon all parties) that, (a) on the basis of existing circumstances,
such transfer will avoid such events and will not result in any additional
costs, liabilities or expenses to such Bank or to the Company and (b) such
transfer is otherwise consistent with the interests of such Bank.
2.15 Indemnity. The Company agrees to indemnify each Bank and
to hold such Bank harmless from all losses or expenses (including, but not
limited to, any such loss or expense arising from interest or fees payable by
such Bank to lenders of funds obtained by it in order to maintain its
Eurodollar Loans hereunder, but excluding loss of the Applicable Margin) which
such Bank may sustain or incur as a consequence of (a) failure by the Company
in making any payment when due (whether by acceleration or otherwise) of the
principal amount of or interest on the Eurodollar Loans of such Bank, (b)
failure by the Company in making a borrowing of Eurodollar Loans, or a
conversion into or continuation of Eurodollar Loans, after the Company has
given a notice requesting or accepting the same in accordance with the
provisions of this Agreement, (c) failure by the Company in making any
prepayment after the Company has given a notice in accordance with subsection
2.5 or (d) a prepayment of a Eurodollar Loan on a day that is not the last day
of the Interest Period with respect thereto. Such indemnification may include
an amount equal to the excess, if any, of (i) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted or
18
continued, for the period from the date of such prepayment or of such failure
to borrow, convert or continue to the last day of the relevant Interest Period
(or proposed Interest Period), in each case at the applicable rate of interest
for such Loans provided for herein (excluding, however, the Applicable Margin)
over (ii) the amount of interest (as reasonably determined by such Bank) which
would have accrued to such Bank on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank eurodollar
market. The agreements in this subsection 2.15 shall survive the payment of
the Loans and all other amounts payable hereunder.
2.16 Taxes. (a) In the event that the adoption of any law,
regulation, treaty or directive or any change therein or in the interpretation
or application thereof, in each case after the date hereof, shall require any
Taxes (as hereinafter defined) to be withheld or deducted from any amount
payable to any Bank under this Agreement, upon notice by such Bank to the
Company (with a copy to the Agent) to the effect that (i) as a result of the
adoption of such law, rule, regulation, treaty or directive or a change
therein or in the interpretation thereof, Taxes are being withheld or deducted
from amounts payable to such Bank under this Agreement and (ii) such Bank has
taken all action required to be taken by it to avoid the imposition of such
Taxes pursuant to paragraph (c) of this subsection 2.16 prior to demanding
indemnification under this paragraph (a), the Company will pay to the Agent
for the account of such Bank additional amounts so that such additional
amounts, together with amounts otherwise payable under this Agreement, will
yield to such Bank, after deduction from such increased amount of all Taxes
required to be withheld or deducted therefrom, the amount stated to be payable
under this Agreement. The term "Taxes" shall mean all net income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, imposed, levied, collected, withheld or assessed by any country
(or by any political subdivision or taxing authority thereof or therein),
excluding, with respect to any Bank, net income and franchise taxes imposed
with respect to net income of any country (or any political subdivision or
taxing authority thereof or therein) where such Bank is organized or, in
respect of such Bank's Eurodollar Loans, by the country (or any political
subdivision or tax authority thereof or therein) where such Bank's Eurodollar
Loans are booked and, in respect of such Bank's Base Rate Loans, by the
country (or any political subdivision or tax authority thereof or therein)
where such Bank's Base Rate Loans are booked. If the Company fails to pay any
Taxes when due following notification by any Bank as provided above, the
Company shall indemnify such Bank for any incremental taxes, interest or
penalties that may become payable by any Bank as a result of any such failure
by the Company to make such payment. The Company may, upon payment by the
Company to any Bank claiming indemnification under this paragraph (a) of any
amount payable by the Company to such Bank, elect by not less than four
Business Days' prior written notice to such Bank to terminate the Commitment
of such Bank and prepay the Loans of such Bank outstanding hereunder on the
next day upon which a prepayment may be made pursuant to subsection 2.5.
(b) Each Bank that is not incorporated under the laws of the
United States of America or a state thereof agrees that it will deliver to the
Company and the Agent (i) two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224 or any successor applicable form, as the
case may be, and (ii) an Internal Revenue Service Form W-8 or W-9 or any
successor form. Each such Bank also agrees to deliver to the Company and the
Agent two further copies of the said Form 1001 or 4224 and Form W-8 or W-9, or
successor applicable forms or other manner of certification, as the case may
be, on or before the date that any such form expires or becomes obsolete or
after the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Company, and such extensions or renewals
thereof as may reasonably be requested by the Company or the Agent, unless in
any such case an event (including, without limitation, any change in treaty,
law or regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable or which
would prevent such Bank from duly completing and delivering any such form with
respect to it and such Bank so advises the Company
19
and the Agent. Such Bank shall certify (i) in the case of Form 1001 or 4224,
that it is entitled to receive payments under this Agreement without deduction
or withholding of any United States federal income taxes and (ii) in the case
of a Form W-8 or W-9, that it is entitled to an exemption from United States
backup withholding tax.
(c) No Bank may request indemnification for any Taxes from the
Company under paragraph (a) of this subsection 2.16 to the extent that such
Taxes would have been avoided or reduced by such Bank's transfer of its Loans
affected by such event to another office of such Bank (or to an affiliate of
such Bank), by such Bank's properly claiming the benefit of any exemption from
or reduction of such Taxes (whether provided by statute, treaty or otherwise)
including, without limitation, by delivering the forms required by paragraph
(b) of this subsection 2.16, or by such Bank's taking any other action which
in its judgment is reasonable to avoid or reduce such Taxes, provided that
such Bank shall not be required to (i) take any action which in the reasonable
judgment of such Bank could directly or indirectly result in any increased
cost or expense or in any loss of opportunity to such Bank unless the Company
shall have provided to such Bank indemnity or reimbursement therefor in form
and substance reasonably satisfactory to such Bank or (ii) claim or apply any
tax credit against such Taxes.
(d) Within 30 days after the payment by the Company of any
Taxes withheld or deducted from any amount payable to any Bank under this
Agreement, and irrespective of whether such Bank is entitled to demand
indemnification in respect thereof under paragraph (a) above, the Company will
furnish to such Bank (with a copy to the Agent), the original or a certified
copy of a receipt evidencing payment thereof.
2.17 Transferred Commitment. (a) The Company and each Bank
agree that Chrysler may by giving four days' notice to the Agent, each Bank
and the Company (which notice shall, upon receipt by the Agent supersede and
cancel all prior notices hereunder), consent to the transfer to and borrowing
by the Company hereunder of such portion of the Available Company/CFC
Commitments (as such term is defined in the Chrysler Agreement) as may be
specified in such notice (as to each Bank, its "Transferred Commitment";
collectively for all the Banks, the "Transferred Commitments"). As of the
Effective Date, the Transferred Commitments shall be zero, unless Chrysler
shall have delivered a notice pursuant to the foregoing sentence at least four
days prior to the Effective Date. Each notice given pursuant to this
subsection shall indicate the total Transferred Commitments and as to each
Bank, its pro rata Transferred Commitment.
(b) The Company also agrees that Chrysler may, by giving thirty
days' written notice to the Agent, each Bank and the Company, withdraw any
consent to the transfer to and borrowing by the Company given in accordance
with subsection 2.17(a) in respect of any portion of the Transferred
Commitments not utilized by the Company as of the date of such notice.
2.18 Use of Proceeds. The proceeds of the Loans hereunder shall
be used by the Company for general corporate purposes.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Agreement and
to make the Loans herein provided for, the Company hereby represents and
warrants to each Bank that:
3.1 Financial Condition. The consolidated balance sheet of the
Company and its Subsidiaries as at December 31, 1994 and the related
consolidated statements of net earnings and cash
20
flows for the fiscal year ended on such date, certified by Deloitte & Touche,
copies of which have been delivered to each Bank, present fairly the
consolidated financial position of the Company and its Subsidiaries as at such
date, and the consolidated results of their operations and cash flows for the
fiscal year then ended. The unaudited consolidated balance sheet of the
Company and its Subsidiaries as at March 31, 1995 and the related consolidated
statements of net earnings and cash flows for the three-month period ended on
such date, certified by a Responsible Officer, copies of which have been
delivered to each Bank, present fairly the consolidated financial condition of
the Company and its Subsidiaries as at such date, and the consolidated results
of their operations for the three-month period then ended (subject to normal
year-end audit adjustments). Such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with GAAP. As at
March 31, 1995, neither the Company nor any of its Subsidiaries had any asset,
liability, contingent obligation, liability for taxes, long-term lease or
unusual forward or long-term commitment material to the financial condition of
the Company and its Subsidiaries taken as a whole, which was not reflected in
the foregoing statements or in the notes thereto.
3.2 No Change. Between December 31, 1994 and the Effective
Date, there has been no material adverse change in the business, operations or
financial condition of the Company and its Subsidiaries taken as a whole.
3.3 Corporate Existence. The Company (a) is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Michigan, and (b) is duly qualified as a foreign corporation to do
business and is in good standing in each of the jurisdictions in which the
character of the properties owned or held under lease by it or the nature of
business transacted by it makes such qualification necessary, except in the
case of this clause (b) to the extent that the failure to be so qualified or
in good standing would not have a material adverse effect on the business,
operations or financial condition of the Company and its Subsidiaries taken as
a whole.
3.4 Corporate Authorization; No Violation. The execution,
delivery and performance by the Company of this Agreement are within the
corporate powers of the Company, have been duly authorized by all necessary
corporate action, and do not contravene any Requirement of Law or Contractual
Obligation of the Company, except to the extent that such contravention would
not have a material adverse effect on the business, operations or financial
condition of the Company and its Subsidiaries taken as a whole or on the
ability of the Company to fulfill its obligations under this Agreement or on
the rights and remedies of the Agent and the Banks hereunder.
3.5 Government Authorization. No authorization or approval or
other action by, and no notice to or filing with, any Governmental Authority
is required to be obtained or made by the Company for the due execution,
delivery and performance by the Company of this Agreement.
3.6 Federal Regulations. Neither the Company nor any of its
Subsidiaries is principally engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U, T, G or X issued by the Federal Reserve Board), and no proceeds
of any borrowing hereunder will be used to purchase or carry any margin stock
or to extend credit to others for the purpose of purchasing or carrying any
margin stock.
3.7 Enforceable Obligations. This Agreement has been duly
executed and delivered on behalf of the Company, and this Agreement
constitutes a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
principles of equity, whether considered in a proceeding in equity or at law.
21
3.8 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending
or, to the knowledge of the Company, threatened by or against the Company or
any of its Subsidiaries or against any of its or their respective properties
or revenues, in which there is a reasonable likelihood of an adverse
determination (a) with respect to this Agreement or any of the transactions
contemplated hereby, if such adverse determination would have a material
adverse effect on the ability of the Company to fulfill its obligations under
this Agreement or on the rights and remedies of the Agent and the Banks
hereunder or (b) which would, if adversely determined, have a material adverse
effect on the business, operations, property or financial condition of the
Company and its Subsidiaries taken as a whole.
3.9 Taxes. Each of the Company and its Subsidiaries has filed
or caused to be filed all material tax returns which to the knowledge of the
Company are required to be filed, and has paid all material taxes shown to be
due and payable on said returns or on any assessments made against it or any
of its property and all other taxes, fees and other charges imposed on it or
any of its property by any Governmental Authority (other than those the amount
or validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP, if
any, have been provided on the books of the Company or its Subsidiaries, as
the case may be).
3.10 ERISA. No Prohibited Transaction or Accumulated Funding
Deficiency (other than those that have been waived by the Internal Revenue
Service) has occurred since July 1, 1974 with respect to any Plan and no
Reportable Event has occurred since July 1, 1974 with respect to any Plan
which could in either case subject the Company or any of its Subsidiaries to
any tax, penalty or other liabilities in the aggregate material in relation to
the business, operations, property or financial or other condition of the
Company and its Subsidiaries taken as a whole. The projected benefit
obligations with respect to all benefits, both vested and nonvested, under all
Single Employer Plans (based on the most recently available actuarial
information and computed in accordance with Statement of Accounting Standards
No. 87) maintained by the Company or a Commonly Controlled Entity did not
exceed, at December 31, 1994, the fair value of the assets of such Plans.
3.11 Investment Company Act; Other Regulations. The Company is
not an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as
amended. The Company is not subject to regulation under any Federal or state
statute or regulation which limits its ability to incur Indebtedness.
3.12 Existing Financial Covenants. Schedule II hereto sets
forth a list of all Material Indebtedness of the Company or any Significant
Subsidiary the documentation with respect to which includes a financial
covenant which is more onerous than, or materially different from, the
financial covenant contained in subsection 6.1, together with a complete and
correct transcription of the text of each such financial covenant.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Effectiveness. The effectiveness of this
Agreement is subject to the satisfaction of the following conditions
precedent:
(a) Execution of Agreement and Addenda. (i) This Agreement
shall have been executed and delivered by a duly authorized officer of
each of the Company and the Agent and (ii) the Agent shall have
received an executed Addendum (or a copy thereof by facsimile
transmission) from each Person listed on Schedule I.
22
(b) Closing Certificate. The Agent shall have received a
certificate of the Company, dated the Effective Date, substantially in
the form of Exhibit D, with appropriate insertions, satisfactory in
form and substance to the Agent, executed by the President or any Vice
President and the Secretary or any Assistant Secretary of the Company,
and attaching the documents referred to in subsection 4.1(c) and (d).
(c) Corporate Proceedings of the Company. The Agent shall have
received a copy of the resolutions, in form and substance satisfactory
to the Agent, of the Board of Directors of the Company (or a duly
authorized committee thereof) authorizing (i) the execution, delivery
and performance of this Agreement and (ii) the borrowings contemplated
hereunder.
(d) Corporate Documents. The Agent shall have received true and
complete copies of the certificate of incorporation and by-laws of the
Company.
(e) Legal Opinions. The Agent shall have received the following
executed legal opinions, with a copy for each Bank:
(i) the executed legal opinion of Simpson Thacher &
Bartlett, counsel to the Agent, substantially in the form of
Exhibit A-1; and
(ii) the executed legal opinion of Allan L. Ronquillo,
Esq., General Counsel of the Company, substantially in the form
of Exhibit A-2.
The Agent shall notify the Banks of the Effective Date promptly after the
occurrence thereof.
4.2 Conditions to All Loans. The obligation of each Bank to
make any Loan on or after the Effective Date to be made by it hereunder is
subject to the satisfaction of the conditions precedent described in clauses
(a) and (b) below:
(a) Representations and Warranties. The representations and
warranties made by the Company herein shall be correct in all material
respects on and as of the Borrowing Date for such Loan as if made on
and as of such date, except for any such representations or warranties
which relate solely to an earlier date.
(b) No Default or Event of Default. No Default or Event of
Default shall have occurred and be continuing on such Borrowing Date
or after giving effect to the Loans to be made on such Borrowing Date.
Each borrowing by the Company hereunder shall constitute a
representation and warranty by the Company as of the date of each such
borrowing that the conditions in this subsection 4.2 have been satisfied.
SECTION 5. AFFIRMATIVE COVENANTS
The Company hereby covenants and agrees that so long as the
Commitments remain in effect, any Loan made hereunder remains outstanding and
unpaid or any other amount is owing to any Bank or the Agent hereunder:
23
5.1 Financial Statements, etc. (a) The Company will furnish to
each Bank:
(i) as soon as available and in any event within 60 days
after the end of the first, second and third quarterly accounting
periods in each fiscal year of the Company, copies of financial
statements of the Company and its Subsidiaries consisting of, at a
minimum, balance sheets of the Company and its Subsidiaries on a
consolidated basis as of the end of such quarterly accounting period,
and related statements of net earnings and cash flows for the portion
of such fiscal year ended with the last day of such quarterly
accounting period, all in reasonable detail and prepared and certified
(subject to year-end audit adjustments) by a Responsible Officer
(which certification may be included in the certificate referred to in
subsection 5.1(a)(iii)) and stating in comparative form the respective
figures for the corresponding date and period in the previous fiscal
year;
(ii) as soon as available and in any event within 90
days after the end of each fiscal year of the Company, copies of
financial statements of the Company and its Subsidiaries consisting
of, at a minimum, balance sheets of the Company and its Subsidiaries
on a consolidated basis as of the end of such fiscal year, and related
statements of net earnings and cash flows for such fiscal year, all in
reasonable detail and certified by independent public accountants of
nationally recognized standing selected by the Company and stating in
comparative form the respective figures as of the end of and for the
previous fiscal year;
(iii) concurrently with the financial statements for
each quarterly accounting period and for each fiscal year of the
Company furnished pursuant to paragraphs (a)(i) and (a)(ii) of this
subsection 5.1, a certificate of a Responsible Officer stating that,
based on an examination which in the opinion of the signer is
sufficient to enable him to make an informed statement, the Company
and its Subsidiaries have performed and observed all of, and neither
the Company nor any of its Subsidiaries is in default in the
performance or observance of any of, the terms, covenants, agreements
and conditions of this Agreement or, if the Company or any of its
Subsidiaries shall be in default, specifying all such defaults and the
nature thereof, of which the signer of such certificate may have
knowledge; and
(iv) such other information relating to the affairs of
the Company and its Subsidiaries as any Bank through the Agent may
from time to time reasonably request.
(b) (i) Upon written request by any Bank through the Agent, the
Company will furnish to such Bank copies of all such reports of the type a
publicly held corporation would generally make available to its stockholders
as the Company shall make available to its parent company and (ii) upon
written request of the Agent, the Company will furnish to the Agent all
regular and periodic reports which the Company or any Subsidiary may be
required to file with the Securities and Exchange Commission or any similar or
corresponding government department, commission, board, bureau or agency,
domestic or foreign, or with any securities exchange.
5.2 Maintenance of Existence. The Company will, and will cause
each Subsidiary to, preserve, renew and keep in full force and effect its
corporate existence and take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business, except for rights, privileges and franchises the loss of which would
not in the aggregate in the reasonable business judgment of the Company have a
material adverse effect on the business, operations, property or financial or
other condition of the Company and its Subsidiaries taken as a whole, and
except as otherwise permitted by subsection 6.6.
24
5.3 Notices. The Company will promptly give notice to the Agent
(which shall notify the Banks) of (a) the occurrence of any Default or Event
of Default (accompanied by a certificate of a Responsible Officer specifying
the nature of such event, the period of existence thereof, and the action that
the Company proposes to take with respect thereto) and (b) the execution and
delivery of any documentation with respect to any Material Indebtedness of the
Company or any Significant Subsidiary if such documentation includes a
financial covenant which is more onerous than, or materially different from,
the financial covenant contained in subsection 6.1, accompanied by a complete
and correct transcription of the text of such financial covenant. The delivery
of any such notice shall be deemed to automatically amend Schedule II to
reflect the existence of such financial covenant and the text thereof.
SECTION 6. NEGATIVE COVENANTS
The Company hereby covenants and agrees that so long as the
Commitments remain in effect, any Loan made hereunder remains outstanding and
unpaid or any other amount is owing to any Bank or the Agent hereunder:
6.1 Debt to Equity Ratio. The Company will not permit the ratio
of Debt on the last day of any fiscal quarter of the Company to Equity on such
day to be greater than 11.0 to 1.0.
6.2 Limitation on Transactions with Affiliates. The Company
will not, and will not permit any Subsidiary to, engage in any transaction
with an Affiliate (other than the Company and its Subsidiaries) on terms
substantially less favorable to the Company or such Subsidiary than would be
obtainable at the time in comparable transactions of the Company or such
Subsidiary with Persons not Affiliates. As used in this subsection 6.2, after
the occurrence of a Change of Control, the term "Affiliate" shall be deemed to
include any CFC Affiliate.
6.3 Limitation on Fundamental Change. The Company will not (a)
merge or consolidate with any other Person (unless (i) the Company shall be
the continuing corporation and (ii) immediately before and immediately after
giving effect to such merger or consolidation, no Default or Event of Default
shall have occurred and be continuing) or (b) sell or convey all or
substantially all of its assets to any Person.
6.4 Limitation on Liens. (a) The Company will not, and will not
permit any Finance Subsidiary to, create, assume or incur, or suffer to be
created, assumed or incurred or to exist, any Lien in respect of any property
of any character of the Company or such Finance Subsidiary, whether heretofore
or hereafter acquired; excluding, however, from the operation of this
covenant:
(i) any deposit of assets of the Company or any of its Finance
Subsidiaries with any surety company or clerk of any court, or in
escrow, as collateral in connection with, or in lieu of, any bond on
appeal by the Company or any of its Finance Subsidiaries, from any
judgment or decree, or in connection with other proceedings or actions
at law or in equity by or against the Company or any of its Finance
Subsidiaries;
(ii) Liens created by any Finance Subsidiary in favor of the
Company or a wholly-owned Subsidiary securing indebtedness of such
Finance Subsidiary to the Company or a wholly-owned Subsidiary (which
Liens cannot be transferred except to the Company or to another
wholly-owned Subsidiary);
25
(iii) any deposits to secure public or statutory obligations of
the Company or any of its Finance Subsidiaries, other than any such
deposit made as a result of or in connection with the occurrence of
any of the events described in clause (i), (ii), (iii) or (iv) of
Section 7(g);
(iv) any purchase money Liens in respect of fixed assets or
other physical or real properties heretofore or hereafter acquired by
the Company or any of its Finance Subsidiaries, or any Liens existing
in respect of such property at the time of acquisition thereof;
provided, however, that no such Lien shall extend to or cover any
other property of the Company or such Finance Subsidiary, as the case
may be;
(v) any Liens which are (A) in respect of fixed assets or other
physical properties of a corporation which is not a Finance Subsidiary
as of the date hereof, and (B) in existence at the time such
corporation becomes a Finance Subsidiary;
(vi) the extension, renewal or replacement of any Lien
permitted by paragraphs (i) through (v) above in respect of the same
property theretofore subject thereto or the extension, renewal or
replacement (without increase of principal amount) of the indebtedness
secured thereby;
(vii) Liens for taxes 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 such
Finance Subsidiary, as the case may be, in accordance with GAAP;
(viii) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other like Liens arising in the ordinary
course of business (A) which are not overdue for a period of more than
60 days or (B) 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 such Finance Subsidiary, as
the case may be, in accordance with GAAP;
(ix) easements, rights-of-way, zoning and similar restrictions
and other similar encumbrances or title defects incurred in the
ordinary course of business which, in the aggregate, are not
substantial 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 its Finance
Subsidiaries;
(x) any attachment or judgment lien, unless the judgment it
secures shall not, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall not
have been discharged within 30 days after the expiration of any such
stay;
(xi) Liens granted on assets in connection with leveraged
leases and project financings entered into in the ordinary course of
the Finance Business;
(xii) Liens granted in connection with the cash
collateralization of bankers' acceptances pursuant to the Long Term
Revolving Credit Agreement or the Short Term Revolving Credit
Agreement;
(xiii) Liens on receivables payable in foreign currencies
(other than Canadian dollars) to secure borrowings in foreign
countries (other than Canada); and
26
(xiv) Liens to secure Indebtedness and other obligations of the
Company or any of its Finance Subsidiaries not otherwise permitted by
this subsection 6.4, but only to the extent that the aggregate amount
of Indebtedness and other obligations secured thereby does not at any
time exceed $100,000,000 (or the equivalent thereof in any other
currency).
(b) The Company will not permit any Domestic Subsidiary that is
not a Finance Subsidiary to create, assume or incur, or suffer to be created,
assumed or incurred or to exist, any Lien in respect of any property of any
character of such Domestic Subsidiary, whether heretofore or hereafter
acquired, excluding, however, from the operation of this covenant:
(i) Liens on property of such Domestic Subsidiary that would
be permitted under subsection 6.4(a) if such Domestic Subsidiary were
a Finance Subsidiary;
(ii) Liens on property of such Domestic Subsidiary that are
incurred in the ordinary course of the Finance Business or the Real
Estate Business of such Domestic Subsidiary; and
(iii) Liens on any property of such Domestic Subsidiary if such
Domestic Subsidiary is a "single purpose" entity formed for the
purpose of holding title to such property and engages in no activities
other than those related to holding title to such property.
6.5 Additional Covenants. At any time after the occurrence of a
Change of Control:
(a) Limitation on Dividends, Investments, etc. The
Company shall not (i) declare or pay any dividend (other than
dividends payable solely in common stock of the Company) on, or make
any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement
or other acquisition of, any shares of any class of Capital Stock of
the Company, whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly,
whether in cash or property or in obligations of the Company or any
Subsidiary or (ii) make, or permit any Subsidiary to make, any
investment, loan, advance, capital contribution or extension of credit
(including by way of guaranty in favor of third party creditors),
whether in cash or property or otherwise, in or to or for the benefit
of any CFC Affiliate, except that (x) so long as no Event of Default
has occurred and is continuing (or would occur after giving effect
thereto), the Company may declare and pay any scheduled dividend on,
and make redemptions of, preferred stock issued by the Company to any
Person (other than a CFC Affiliate) to the extent permitted by the
terms thereof and (y) the Company and its Subsidiaries may make
investments, loans, advances and extensions of credit in or to or for
the benefit of any CFC Affiliate in the ordinary course of its Finance
Business consistent with historical practices (in each case determined
as of the date of such Change of Control) and in accordance with
subsection 6.2.
(b) Minimum Equity. The Company shall not permit Equity
(determined without giving effect to any redemption of preferred stock
of the Company made pursuant to subsection 6.5(a) after the date of
such Change of Control) to be less than an amount equal to Equity as
of the day immediately preceding the occurrence of such Change of
Control minus $250,000,000.
(c) Limitation on Amendments to Intercompany
Agreements; CFC Affiliate Transactions. The Company shall not, and
shall not permit any Subsidiary to, (i) amend or modify, or agree to
amend or modify, any of the provisions of any Intercompany Agreement
27
in a manner materially adverse to the interests of either (x) the
Company and its Subsidiaries taken as a whole or (y) the Banks, or
(ii) enter into, or agree to enter into, any Intercompany Agreement
which is materially adverse to the interests of either (x) the Company
and its Subsidiaries taken as a whole or (y) the Banks. As used in
this subsection 6.5(c), "Intercompany Agreement" means any agreement
between the Company or any Subsidiary and any CFC Affiliate, any
instrument issued by the Company or any Subsidiary to any CFC
Affiliate and any instrument issued by any CFC Affiliate to the
Company or any Subsidiary.
(d) Limitation on Lines of Business. The Company shall
not, and shall not permit any Subsidiary to, engage in any business
other than the Finance Business, the Finance-Related Insurance Business
and the other businesses in which the Company and its Subsidiaries are
engaged as of the date of such Change of Control, and other than
businesses in which the Company or any of its Subsidiaries may be
involved in connection with or related to any workout, liquidation,
foreclosure or other realization on or disposition of assets in which
it has a security interest, or any other exercise of rights or
remedies pursuant to a workout in connection with any financing
(whether equity or debt) provided by the Company or any of its
Subsidiaries to any Person.
SECTION 7. EVENTS OF DEFAULT
Upon the occurrence of any of the following events:
(a) the Company shall fail to pay any principal of any Loan
made hereunder when due in accordance with the terms hereof; or to pay
any interest on any Loan made hereunder or any other amount payable
hereunder within five Business Days after any such interest or other
amount becomes due in accordance with the terms hereof; or
(b) any representation or warranty made by the Company herein,
or deemed made by the Company pursuant to Section 3 or 4, or contained
in any certificate, document or financial or other statement furnished
at any time under or in connection with this Agreement shall prove to
have been incorrect in any material respect on or as of the date made
or deemed made; or
(c) the Company shall default in the observance or performance
of any agreement contained in subsection 6.1, 6.3 or 6.5; or
(d) the Company shall default in the observance or performance
of any other agreement, covenant or term contained in this Agreement
(including any failure to make any payment required hereunder other
than as described in paragraph (a) above), and such default shall
continue unremedied for a period of 30 days after receipt by the
Company of notice of such default from the Agent; or
(e) the Company or any Significant Subsidiary shall default in
any payment of $25,000,000 (or the equivalent thereof in any other
currency) or more of principal of or interest on any Indebtedness or
in the payment of $25,000,000 (or the equivalent thereof in any other
currency) or more on account of any guarantee in respect of
Indebtedness, beyond the period of grace, if any, provided in the
instrument or agreement under which such Indebtedness or guarantee was
created; or
28
(f) (i) the Company or any of its Significant Subsidiaries
shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of
debtors, seeking to have an order for relief entered with respect to
it, or seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of
its assets, or the Company or any of its Significant Subsidiaries
shall make a general assignment for the benefit of its creditors; or
(ii) there shall be commenced against the Company or any of its
Significant Subsidiaries any case, proceeding or other action of a
nature referred to in clause (i) above which (A) results in the entry
of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of 60 days;
or (iii) there shall be commenced against the Company or any of its
Significant Subsidiaries any case, proceeding or other action seeking
issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets which
results in the entry of an order for any such relief which shall not
have been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) the Company or any of
its Significant Subsidiaries shall take any action in furtherance of,
or indicating its consent to, approval of, or acquiescence in, any of
the acts set forth in clause (i), (ii) or (iii) above; or (v) the
Company or any of its Significant Subsidiaries shall admit in writing
its inability to pay its debts generally as they become due; or
(g) (i) any Person shall engage in any Prohibited Transaction
involving any Plan, (ii) any Accumulated Funding Deficiency, whether
or not waived, shall exist with respect to any Plan, (iii) a
Reportable Event shall occur with respect to, or proceedings shall
commence to have a trustee appointed, or a trustee shall be appointed,
to administer or to terminate, any Single Employer Plan, which
Reportable Event or institution of proceedings is, in the reasonable
opinion of the Required Banks, likely to result in the termination of
such Plan for purposes of Title IV of ERISA, and, in the case of a
Reportable Event, the continuance of such Reportable Event unremedied
for ten days after notice of such Reportable Event pursuant to Section
4043(a), (c) or (d) of ERISA is given or the continuance of such
proceedings for ten days after commencement thereof, as the case may
be, (iv) any Single Employer Plan shall terminate for purposes of
Title IV of ERISA, or (v) any other event or condition shall occur or
exist with respect to a Single Employer Plan; and in each case in
clauses (i) through (v) above, the Agent shall have notified the
Company that, in the opinion of the Required Banks, such event or
condition, together with all other such events or conditions, if any,
could reasonably be expected to subject the Company or any of its
Subsidiaries to any tax, penalty or other liabilities in the aggregate
material in relation to the business, operations, property or
financial or other condition of the Company and its Subsidiaries taken
as a whole; or
(h) one or more final judgments or decrees shall be entered
against the Company or any of its Significant Subsidiaries involving
in the aggregate a liability (not paid or fully covered by insurance)
of $100,000,000 (or the equivalent thereof in any other currency) or
more, shall have been unpaid for a period of 60 days and shall not
have been stayed; or
(i) Chrysler shall at any time fail to own at least 51% of the
issued and outstanding shares of the common stock of the Company; or
(j) the Company or any of its Significant Subsidiaries shall
default in the observance or performance of any financial covenant
contained in any instrument or agreement evidencing, securing or
relating to any of its Material Indebtedness, the effect of which
default
29
is to cause, or to permit the holder or holders of such Material
Indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause, such Material Indebtedness to become due prior to
its stated maturity;
then, and in any such event, (a) if such event is an Event of Default
specified in clause (i) or (ii) of paragraph (f) above with respect to the
Company, automatically the Commitments shall immediately terminate and the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement shall immediately become due and payable, and (b) if such
event is any other Event of Default, either or both of the following actions
may be taken: (i) with the consent of the Required Banks, the Agent may, or
upon the request of the Required Banks, the Agent shall, by notice to the
Company, declare the Commitments to be terminated forthwith, whereupon the
Commitments shall immediately terminate; and (ii) with the consent of the
Required Banks, the Agent may, or upon the request of the Required Banks, the
Agent shall, by notice of default to the Company, declare the Loans hereunder
(with accrued interest thereon) and all other amounts owing under this
Agreement to be due and payable forthwith, whereupon the same shall
immediately become due and payable. Except as expressly provided above in this
Section 7, presentment, demand, protest and all other notices of any kind are
hereby expressly waived.
SECTION 8. THE AGENT
8.1 Appointment. Each Bank hereby irrevocably designates and
appoints Chemical as the Agent of such Bank under this Agreement, and each
Bank hereby irrevocably authorizes Chemical as Agent for such Bank, to take
such action on its behalf under the provisions of this Agreement and to
exercise such powers and perform such duties as are expressly delegated to the
Agent by the terms of this Agreement, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Agent.
8.2 Delegation of Duties. The Agent may execute any of its
duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to
such duties. Without limiting the foregoing, the Agent may appoint CASC as its
agent to perform the functions of the Agent hereunder relating to the
advancing of funds to the Company and distribution of funds to the Banks and
to perform such other related functions of the Agent hereunder as are
reasonably incidental to such functions.
8.3 Exculpatory Provisions. Neither the Agent, nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates
(including, without limitation, CASC) shall be (a) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement (except for its or such Person's own gross
negligence or willful misconduct), or (b) responsible in any manner to any of
the Banks for any recitals, statements, representations or warranties made by
the Company or any officer thereof contained in this Agreement or in any
certificate, report, statement or other document referred to or provided for
in, or received by the Agent under or in connection with, this Agreement or
for any failure of the Company to perform its obligations hereunder. The Agent
shall not be under any obligation to any Bank to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records
of the Company.
30
8.4 Reliance by Agent and CASC. The Agent and CASC shall be
entitled to rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, facsimile transmission, telex or teletype message, statement, order
or other document or conversation believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Company), independent accountants and other experts selected by the
Agent. The Agent and CASC may deem and treat the Bank specified in the
Register with respect to any amount owing hereunder as the owner thereof for
all purposes unless a written notice of assignment, negotiation or transfer
thereof shall have been filed with the Agent in accordance with subsection
9.7. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement unless it shall first receive such advice or
concurrence of the Required Banks (or, if so specified in this Agreement, all
of the Banks) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Agent shall, in all cases, be fully protected in acting, or in refraining
from acting, under this Agreement in accordance with a request of the Required
Banks (or, if so specified in this Agreement, all of the Banks), and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Banks and all future holders of the obligations owing by
the Company hereunder.
8.5 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
unless the Agent has received notice from a Bank or the Company referring to
this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default". In the event that the Agent receives
such a notice, the Agent shall give notice thereof to the Banks, and, if such
notice is received from a Bank, the Agent shall give notice thereof to the
Company and each other Bank. Subject to the proviso contained in the first
sentence of subsection 9.1, the Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the
Required Banks (or, if so specified in this Agreement, all of the Banks),
provided that, unless and until the Agent shall have received such directions,
the Agent may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of Default as
it shall deem advisable in the best interests of the Banks.
8.6 Non-Reliance on Agent, Other Banks and CASC. Each Bank
expressly acknowledges that neither the Agent, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates (including,
without limitation, CASC) has made any representations or warranties to it and
that no act by the Agent hereafter taken, including any review of the affairs
of the Company, shall be deemed to constitute any representation or warranty
by the Agent to any Bank. Each Bank represents to the Agent and CASC that it
has, independently and without reliance upon the Agent, any other Bank or
CASC, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of
the Company and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Bank also represents that it will, independently and
without reliance upon the Agent, any other Bank or CASC, and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own credit analysis, appraisals and decisions in taking or not
taking action under this Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Company. Except for notices,
reports and other documents expressly required to be furnished to the Banks by
the Agent hereunder, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the business,
operations, property, financial and other condition or creditworthiness of the
Company
31
which may come into the possession of the Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.
8.7 Indemnification. The Banks agree to indemnify the Agent and
CASC (to the extent not reimbursed by the Company and without limiting the
obligation of the Company to do so), ratably according to the respective
amounts of their respective Commitment Percentages in effect on the date on
which indemnification is sought under this subsection 8.7 (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated, ratably in accordance with such Commitment Percentages immediately
prior to such date) from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including, without
limitation, at any time following the payment of the Loans made hereunder) be
imposed on, incurred by or asserted against the Agent or CASC in any way
relating to or arising out of this Agreement or any other documents
contemplated by or referred to herein or the transactions contemplated hereby
or any action taken or omitted by the Agent or CASC under or in connection
with any of the foregoing, provided that no Bank shall be liable for the
payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Agent's or CASC's gross negligence or willful misconduct.
The agreements in this subsection 8.7 shall survive the payment of the Loans
made hereunder and all other amounts payable hereunder.
8.8 Agent in its Individual Capacity. The Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Company as though the Agent were not the Agent
hereunder. With respect to its Loans made or renewed by it, the Agent shall
have the same rights and powers under this Agreement as any Bank and may
exercise the same as though it were not the Agent and the terms "Bank" and
"Banks" shall include the Agent in its individual capacity.
8.9 Successor Agent. The Agent may resign as Agent, upon 10
days' notice to the Banks and the Company, and may be removed at any time with
or without cause by the Required Banks. If the Agent shall resign or be
removed as Agent under this Agreement, then either (a) the Required Banks
shall appoint from among the Banks a successor agent for the Banks, which
successor agent shall be approved by the Company, or (b) if a successor agent
shall not have been so appointed and approved within the ten-day period
following the Agent's notice to the Banks or its removal as Agent, the Agent
shall then, with the consent of the Company, appoint a successor agent who
shall serve as Agent until such time, if any, as the Required Banks appoint,
and the Company approves, a successor agent as provided in (a) above. Upon its
appointment pursuant to either clause (a) or (b) above, such successor agent
shall succeed to the rights, powers and duties of the Agent, and the term
"Agent" shall mean such successor agent effective upon its appointment, and
the former Agent's rights, powers and duties as Agent shall be terminated,
without any other or further act or deed on the part of such former Agent or
any of the parties to this Agreement or any holders of the obligations owing
by the Company hereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Section 8 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. With the written consent of the
Required Banks, the Agent and the Company may, from time to time, enter into
written amendments, supplements or modifications hereto for the purpose of
adding any provisions to this Agreement or changing in any manner the rights
of the Banks or of the Company hereunder, and with the consent of the Required
32
Banks, the Agent on behalf of the Banks may execute and deliver to the Company
a written instrument waiving, on such terms and conditions as the Agent may
specify (with such consent) in such instrument, any of the requirements of
this Agreement or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, supplement or
modification shall (a) extend the maturity of any Loan, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount
thereof, or change the amount or terms of any Bank's Commitment, or amend,
modify or waive any provision of this subsection 9.1 or reduce the percentage
specified in the definition of Required Banks, or consent to the assignment or
transfer by the Company of any of its rights and obligations under this
Agreement or amend, modify or waive the provisions of subsection 9.8, in each
case without the prior written consent of each Bank directly affected thereby,
or (b) amend, modify or waive any provision of Section 8 without the prior
written consent of the Agent. Each Bank hereby consents to the inclusion in
this Agreement of each and every amendment, revision, addition, change, waiver
or other modification to Section 7, Section 8 and/or the definitions of
"Applicable Margin", "Base Rate", "Eurodollar Rate" and "Status" (including
each defined term referred to in the definition of "Status") of the Long Term
Revolving Credit Agreement made after the Effective Date (except to the extent
relating to any provision contained in such Sections on the Effective Date as
to which there is no comparable provision herein on the Effective Date) and
each and every such amendment, revision, addition, change, waiver or other
modification thereof is hereby incorporated, as in effect from time to time,
into this Agreement with the same effect as if fully set forth in Section 5,
Section 6 and/or the definitions of "Applicable Margin", "Base Rate",
"Eurodollar Rate" and "Status" (including each defined term referred to in the
definition of "Status") of this Agreement, as appropriate, provided that for
purposes of this Agreement if the Long Term Revolving Credit Agreement is
terminated such Sections 5 and 6 and such definitions of "Applicable Margin",
"Base Rate", "Eurodollar Rate" and "Status" shall remain in effect for
purposes of this Agreement in the form in which they shall be in effect on the
date of such termination; provided, further, that for purposes of this
Agreement if the Long Term Revolving Credit Agreement is amended so as to
remove the covenant set forth in Section 8.4 of the Long Term Revolving Credit
Agreement, subsection 6.4 hereof shall not be so amended, and if any provision
of Section 8.4 of the Long Term Revolving Credit Agreement is amended or
waived so as to grant to the financial institutions under the Long Term
Revolving Credit Agreement a Lien on any assets of the Company or its
Subsidiaries, the obligations of the Company hereunder shall be secured, and
the Company shall take such action and execute such security documents as the
Agent may reasonably request to further effect the security of such
obligations, equally and ratably with its obligations to the financial
institutions under the Long Term Revolving Credit Agreement. The Company will
advise the Agent promptly of any amendment to or termination of the Long Term
Revolving Credit Agreement. Any such waiver and any such amendment, supplement
or modification shall apply equally to each of the Banks and shall be binding
upon the Company, the Banks, the Agent and all future holders of the
obligations owing by the Company hereunder. In the case of any waiver, the
Company, the Banks and the Agent shall be restored to their former position
and rights hereunder and any Default or Event of Default waived shall be
deemed to be cured and not continuing; but no such waiver shall extend to any
subsequent or other Default or Event of Default, or impair any right
consequent thereon. No provision of this subsection 9.1 shall limit the rights
of any party hereto pursuant to subsections 2.13, 2.14, 2.15, 2.16, 9.8 and
9.9.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing or by telecopy
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given or made when delivered by hand or when deposited in the mail, first
class or air postage prepaid, or, in the case of telecopied notice, when
telecopied, receipt acknowledged, addressed as follows in the case of the
Company and the Agent, and as set forth
33
in its Addendum in the case of the other parties hereto, or to such other
address as may be hereafter notified by the respective parties hereto and any
future holders of the obligations owing by the Company hereunder:
The Company: Chrysler Financial Corporation
27777 Franklin Road
Southfield, Michigan 48034-8286
Attention: Vice President and Treasurer
Telecopy: 810-948-3801
The Agent: Chemical Bank
270 Park Avenue
New York, New York 10017
Attention: Rosemary Bradley
Telecopy: 212-972-9854
With Copies
to: Chemical Bank Agency
Services
Grand Central Tower
140 East 45th Street
New York, New York 10017
Attention: Sandra Miklave
Telecopy: 212-622-0002
provided that any notice, request or demand to or upon the Agent pursuant to
subsection 2.2, 2.4, 2.17, or 8.5 shall not be effective until received.
9.3 Clearing Accounts. (a) Each Bank irrevocably authorizes the
Agent and CASC to cause such Bank's Clearing Account to be debited as
contemplated in subsection 2.2 and to cause to be created an overdraft in such
account if the balance in such Bank's Clearing Account on a particular
Borrowing Date is less than the amount of the Loan to be made by such Bank on
such day. In addition each Bank irrevocably authorizes the Agent and CASC to
cause such Bank's Clearing Account to be credited, as contemplated in
subsection 2.12(a), with its ratable share of payments received by the Agent
from the Company. The Clearing Account of each Bank shall be maintained at its
own expense and free of charge to the Agent, CASC and the Company.
(b) The Agent may at any time in its sole discretion, upon
notice to the Company and the Banks, discontinue the use of ACH procedures in
connection with Loans made pursuant hereto, and the Banks shall thereafter
fund each Loan required to be made by them hereunder by making available the
amount thereof to the Agent for the account of the Company at the office of
the Agent set forth in subsection 9.2 in funds immediately available to the
Agent.
9.4 No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Agent or any Bank, any right,
remedy, power or privilege hereunder, shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or of the exercise of
any other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
34
9.5 Survival of Representations and Warranties. All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement.
9.6 Payment of Expenses. The Company agrees:
(a) to pay or reimburse the Agent for all reasonable
out-of-pocket costs and expenses incurred in connection with the
preparation and execution of, and any amendment, supplement or
modification to or waiver under, this Agreement and any other
documents prepared in connection herewith, and the consummation of the
transactions contemplated hereby and the administration of this
Agreement, including, without limitation, the reasonable fees and
disbursements of Simpson Thacher & Bartlett, special counsel to the
Agent and the Banks;
(b) to pay or reimburse each Bank and the Agent for all costs
and expenses (other than legal fees and disbursements) incurred in
connection with the enforcement or preservation of any rights under
this Agreement and any such other documents and the reasonable fees
and disbursements of one firm of special counsel to the Agent and the
Banks; and
(c) to (i) indemnify each Bank from and against liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements (other than legal fees and
disbursements) of any kind whatsoever (and, with respect to any
proceeding or related proceedings, the reasonable fees and
disbursements of one firm of special counsel to the relevant Banks in
connection with such proceeding(s)) which may at any time (including,
without limitation, at any time following the payment of the Loans
made hereunder) be imposed on, incurred by or asserted against such
Bank in any way relating to or arising out of this Agreement or any
other documents contemplated by or referred to herein or the
transactions contemplated hereby or any action taken or omitted by
such Bank under or in connection with any of the foregoing, provided
that the Company shall not be liable for the payment of any portion of
such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from (x)
the ordinary course administration of this Agreement or such other
documents by any Bank or (y) any Bank's gross negligence or willful
misconduct or bad faith and (ii) pay or reimburse (x) each Bank for
any payments made by such Bank to the Agent or CASC pursuant to the
provisions of subsection 8.7 and (y) the Agent and CASC for any and
all liabilities, expenses or disbursements incurred by any of them
which pursuant to the provisions of subsection 8.7 are the subject of
indemnification payments from the Banks to the extent that the Agent
or CASC, for whatever reason, did not receive such indemnification
payments from any Bank or Banks.
The agreements in this subsection 9.6 shall survive the
repayment of the Loans made hereunder and all other amounts payable hereunder.
9.7 Successors and Assigns; Participations and Assignments. (a)
This Agreement shall be binding upon and inure to the benefit of the Company,
the Banks and the Agent, and their respective successors and assigns, except
that the Company may not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of each Bank.
(b) Any Bank may, in the ordinary course of its commercial
banking business and in accordance with applicable law, at any time sell to
one or more banks or other entities ("Participants") participating interests
in any Loan owing to such Bank, any Commitment of such Bank or any other
interest of such Bank hereunder. In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement to the other parties to this Agreement
35
shall remain unchanged, such Bank shall remain solely responsible for the
performance thereof, such Bank shall remain the holder of any Loan made by it
for all purposes under this Agreement, and the Company and the Agent shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement, provided, that the terms
of any participation agreement or certificate relating to any such
participation shall prohibit any subparticipations by such participant and
provided, further any such participation agreement or certificate shall permit
the Bank granting such participations the right to consent to waivers,
amendments or supplements to this Agreement without the consent of such
participant except in the case of (a) waivers of any Default or Event of
Default described in Section 7(a), and (b) any amendment or modification
extending the maturity of any Loan, or reducing the rate or extending the time
of payment of interest thereon, or reducing the principal amount thereof. The
Company agrees that if amounts outstanding under this Agreement are due or
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall be deemed to
have the right of setoff in respect of its participating interest in amounts
owing under this Agreement to the same extent as if the amount of its
participating interest were owing directly to it as a Bank under this
Agreement, provided that, in purchasing such participating interest, such
Participant shall be deemed to have agreed to share with the Banks the
proceeds thereof as provided in subsection 9.9 as fully as if it were a Bank
hereunder. All amounts payable by the Company under Section 2 shall be
determined as if such Bank had not sold such participations.
(c) Any Bank may assign to any Bank or additional bank or
financial institution or any Federal Reserve Bank all or any part of its
rights and obligations under this Agreement on the terms and conditions set
forth in subsection 9.6(c), (d), (e) and (g) of the Chrysler Agreement, the
provisions of which (including the definitions of defined terms used therein)
are incorporated herein by reference as if set forth fully herein; provided,
however, that in no event shall any such assignment by any Bank to any
assignee (other than any pledge or assignment of Loans to a Federal Reserve
Bank) be permitted hereunder unless contemporaneously therewith such Bank
shall assign to such assignee a percentage interest in such Bank's rights and
obligations under the Chrysler Agreement and the promissory notes issued
thereunder that is equal to the percentage interest then being assigned
hereunder.
(d) The Company authorizes each Bank to disclose to any
Participant or Assignee (as defined in the Chrysler Agreement) (each, a
"Transferee") and any prospective Transferee any and all financial information
in such Bank's possession concerning the Company and its Affiliates which has
been delivered to such Bank by or on behalf of the Company pursuant to this
Agreement or which has been delivered to such Bank by or on behalf of the
Company in connection with such Bank's credit evaluation of the Company and
its affiliates prior to becoming a party to this Agreement.
(e) In order to facilitate any pledge or assignment to any
Federal Reserve Bank of any Loans made by any Bank hereunder, the Company
hereby agrees that, upon request of any Bank at any time and from time to time
after the Company has made its initial borrowing hereunder, the Company shall
provide to such Bank, at the Company's own expense, a note, substantially in
the form of Exhibit E, evidencing the Loans owing to such Bank.
(f) The Agent shall maintain at its address referred to in
subsection 9.2 a register (the "Register") for the recordation of the names
and addresses of the Banks, the Commitments of the Banks, and the principal
amount of each Type of Loan owing to each Bank from time to time. The entries
in the Register shall be conclusive, in the absence of clearly demonstrable
error, and the Company, the Agent and the Banks may treat each Person whose
name is recorded in the Register as the owner of the Loan recorded therein for
all purposes of this Agreement. The Register shall be available for inspection
by the Company or any Bank at any reasonable time and from time to time
36
upon reasonable prior notice. The Agent shall give prompt written notice to
the Company of the making of any entry in the Register or any change in any
such entry.
9.8 Right of Set-off. Upon (a) the occurrence and during the
continuance of an Event of Default and (b) with the consent of the Required
Banks, each Bank is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held
and other indebtedness at any time owing by such Bank (including, without
limitation, its branches) to or for the credit or the account of the Company
against any and all of the obligations of the Company now or hereafter
existing under this Agreement, irrespective of whether or not such Bank shall
have made any demand under this Agreement and although such obligations may be
unmatured. Each Bank agrees promptly to notify the Company after any such
set-off and application made by such Bank, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Bank under this subsection are in addition to other rights and
remedies (including, without limitation, other rights of set-off) which such
Bank may have.
9.9 Adjustments. If any Bank (a "benefitted Bank") shall at any
time, except in connection with any termination or assignment of or by such
Bank pursuant to this Agreement, receive any payment of all or part of its
Loans made hereunder, or interest thereon, or receive any collateral in
respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to
events or proceedings of the nature referred to in clause (f) of Section 7, or
otherwise) in a greater proportion than any such payment to, or any collateral
received by, any other Bank, if any, in respect of such other Bank's Loans, or
interest thereon, such benefitted Bank shall purchase for cash from the other
Banks such portion of each such other Bank's Loans, or shall provide such
other Banks with the benefits of any such collateral, or the proceeds thereof,
as shall be necessary to cause such benefitted Bank to share the excess
payment or benefits of such collateral or proceeds ratably with each of the
Banks; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such benefitted Bank, such purchase
shall be rescinded, and the purchase price and benefits returned, to the
extent of such recovery, but without interest. The Company agrees that each
Bank so purchasing a portion of another Bank's Loans may exercise all rights
of payment (including, without limitation, rights of set-off) with respect to
such portion as fully as if such Bank were the direct holder of such portion.
9.10 New Banks. During the term of this Agreement with the
consent of the Company and upon notification to the Agent, one or more
additional financial institutions may become a party to this Agreement by
executing a supplement hereto with the Company and the Agent, substantially in
the form of Exhibit B, whereupon such financial institution (herein called a
"New Bank") shall become a Bank for all purposes and to the same extent as if
originally a party hereto and shall be bound by and entitled to the benefits
of this Agreement, provided that any such New Bank has also become a New Bank
under the Chrysler Agreement pursuant to subsection 9.10 thereof. Effective as
of the date on which any such New Bank becomes a Bank pursuant to the
provisions of this subsection, the Agent, each Bank and the Company shall
receive a notice from Chrysler of each Bank's Commitment and the aggregate
Commitments pursuant to subsection 2.17 of the Chrysler Agreement. If on the
date upon which such New Bank becomes a Bank pursuant to the provisions of
this subsection 9.10, there is an unpaid principal amount of the Loans
outstanding hereunder, the Company shall borrow from such New Bank through the
Agent, in an amount determined by multiplying the amount of such New Bank's
Commitment by a fraction, the numerator of which shall be the then unpaid
principal amount of the Loans outstanding hereunder and the denominator of
which shall be the aggregate Commitments of the Banks other than the New Bank.
Notwithstanding anything herein to the contrary, if there are Eurodollar Loans
outstanding, a financial institution that becomes a New Bank will make
Eurodollar Loans to the Company (pro rata according to its
37
Commitment Percentage) having Interest Periods corresponding to the then
unexpired portions of the respective Interest Periods of such Eurodollar Loans
and bearing interest at a rate equal to the respective interest rates then
applicable to such Eurodollar Loans. The Agent shall advise the Banks of each
addition of a New Bank hereunder, of the amount of its Commitment and of the
amount of any borrowing from it hereunder made simultaneously upon its
addition.
9.11 Increase in Commitments. During the term of this
Agreement, upon any Bank increasing its Commitment under the Chrysler
Agreement and Chrysler giving the notice required by subsection 2.17(c) of the
Chrysler Agreement, such Bank shall be deemed to have increased its Commitment
hereunder as set forth in such notice, whereupon such Bank shall be bound by
and entitled to the benefits of this Agreement with respect to the full amount
of its Commitment as so increased. Effective as of the date on which any such
Bank increases its Commitment pursuant to the provisions of this subsection
9.11, the Agent, each Bank and the Company shall receive a notice from
Chrysler of each Bank's Commitment and the aggregate Commitments pursuant to
subsection 2.17 of the Chrysler Agreement. If on the date upon which such Bank
increases its Commitment pursuant to this subsection 9.11 there is an unpaid
principal amount of the Loans hereunder, the Company shall borrow from such
Bank through the Agent, in an amount determined by multiplying the amount of
the increase in such Bank's Commitment by a fraction, the numerator of which
shall be the then unpaid principal amount of the Loans outstanding hereunder
and the denominator of which shall be the aggregate Commitments of the Banks
other than the amount of the additional Commitment of such Bank.
Notwithstanding anything herein to the contrary, if there are Eurodollar Loans
outstanding, a Bank that increases its Commitment pursuant to this subsection
9.11 will make Eurodollar Loans to the Company (pro rata according to the
amount of the increase in such Bank's Commitment) having Interest Periods
corresponding to the then unexpired portions of the respective Interest
Periods of such Eurodollar Loans and bearing interest at a rate equal to the
respective interest rates then applicable to such Eurodollar Loans. The Agent
shall advise the Banks of such increase in the Commitment of a Bank and of the
amount of any borrowing from it hereunder made simultaneously upon such
increase.
9.12 Tax Forms. If any Bank which becomes a party to this
Agreement on any day after the date hereof pursuant to subsection 9.7 or 9.10
is organized under the laws of any jurisdiction other than the United States
or any state thereof, such Bank shall on such day (i) represent to the
transferor Bank (if applicable), the Agent and the Company that under
applicable law and treaties no taxes will be required to be withheld by the
Agent, the Company or the transferor Bank (if applicable) with respect to any
payments to be made to such Bank in respect of the Loans hereunder, (ii)
furnish to the transferor Bank (if applicable), the Agent and the Company
either U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue
Service Form 1001 (wherein such Bank claims entitlement to complete exemption
from U.S. federal withholding tax on all interest payments hereunder) and
(iii) agree (for the benefit of the transferor Bank (if applicable), the Agent
and the Company) to provide the transferor Bank (if applicable), the Agent and
the Company a new Form 4224 or Form 1001 upon the expiration or obsolescence
of any previously delivered form and comparable statements in accordance with
applicable U.S. laws and regulations and amendments duly executed and
completed by such Bank, and to comply from time to time with all applicable
U.S. laws and regulations with regard to such withholding tax exemption.
9.13 Counterparts. This Agreement may be executed by one or
more of the parties hereto on any number of separate counterparts and all of
said counterparts taken together shall be deemed to constitute one and the
same instrument. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Company and the Agent.
38
9.14 Governing Law. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
9.15 Submission to Jurisdiction; Waivers. The Company hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding commenced by any party hereto relating to this Agreement,
or for recognition and enforcement of any judgment in respect thereof,
to the non-exclusive general jurisdiction of the courts of the State
of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts, and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court
or that such action or proceeding was brought in an inconvenient court
and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to the Company at its address set forth in subsection 9.2 or
at such other address of which the Agent shall have been notified with
copies addressed as set forth in subsection 9.2; and
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction.
9.16 Integration. This Agreement represents the agreement of
each party with respect to the subject matter hereof, and there are no
promises or representations by the Agent or any Bank relative to the subject
matter hereof not reflected herein.
9.17 Restatement. It is the intention of each of the parties
hereto that all indebtedness of the Company under the Fourth Amended and
Restated Commitment Transfer Agreement be continued hereunder, and that the
Fourth Amended and Restated Commitment Transfer Agreement be amended and
restated in its entirety to reflect such continuation.
39
9.18 WAIVERS OF JURY TRIAL. THE COMPANY, THE AGENT AND THE
BANKS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR
ANY COUNTERCLAIM THEREIN.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly
authorized officers as of the day and year first above written.
CHRYSLER FINANCIAL CORPORATION
By: /s/ David A. Robison
---------------------------------------
Title: Vice President and Treasurer
CHEMICAL BANK, as Agent
By: /s/ Rosemary Bradley
--------------------------------------
Title: Vice President