Exhibit 10.17
CREDIT AGREEMENT
dated as of March 26, 1996
among
CUC INTERNATIONAL INC.
the Banks signatory
hereto
THE CHASE MANHATTAN BANK, N.A.,
BANK OF MONTREAL,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
and
THE SAKURA BANK, LIMITED
as Co-Agents
and
THE CHASE MANHATTAN BANK,N.A.
as Administrative Agent
Table of Contents
ARTICLE 1 DEFINITIONS; ACCOUNTING TERMS.
Section 1.1 Definitions
Section 1.2 Accounting Terms
Section 1.3 Rules of Interpretation
ARTICLE 2 THE CREDIT.
Section 2.1 The Loans
Section 2.2 The Notes
Section 2.3 Purpose
Section 2.4 Borrowing Procedures
Section 2.5 Prepayments and Conversions
Section 2.6 Interest Periods; Renewals
Section 2.7 Changes of Commitments
Section 2.8 Certain Notices
Section 2.9 Minimum Amounts
Section 2.10 Interest
Section 2.11 Fees
Section 2.12 Payments Generally
Section 2.13 Margin for Eurodollar Loans
Section 2.14 Facility Fee Rate
ARTICLE 3 YIELD PROTECTION; ILLEGALITY; ETC.
Section 3.1 Additional Costs
Section 3.2 Limitation on Types of Loans
Section 3.3 Illegality
Section 3.4 Certain Conversions Pursuant to Sections 3.1 and 3.3
Section 3.5 Certain Compensation
ARTICLE 4 CONDITIONS PRECEDENT.
Section 4.1 Initial Conditions Precedent
Section 4.2 Additional Conditions Precedent
Section 4.3 Deemed Representations
ARTICLE 5 REPRESENTATIONS AND WARRANTIES.
Section 5.1 Incorporation, Good Standing and Due Qualification
Section 5.2 Corporate Power and Authority; No Conflicts
Section 5.3 Legally Enforceable Agreements
Section 5.4 Litigation
Section 5.5 Financial Statements
Section 5.6 Ownership and Liens
Section 5.7 Taxes
Section 5.8 ERISA
Section 5.9 Material Subsidiaries and Ownership of Stock
Section 5.10 Credit Arrangements
Section 5.11 Operation of Business
Section 5.12 Hazardous Materials
Section 5.13 No Default on Outstanding Judgments or Orders
Section 5.14 No Defaults on Other Agreements
Section 5.15 Labor Disputes and Acts of God
Section 5.16 Governmental Regulation
Section 5.17 Insurance
Section 5.18 Intellectual Property
ARTICLE 6 AFFIRMATIVE COVENANTS.
Section 6.1 Maintenance of Existence
Section 6.2 Conduct of Business
Section 6.3 Maintenance of Properties
Section 6.4 Maintenance of Records
Section 6.5 Maintenance of Insurance
Section 6.6 Compliance with Laws
Section 6.7 Right of Inspection
Section 6.8 Reporting Requirements
Section 6.9 Payment of Taxes and Other Potential
Charges and Priority Claims
Section 6.10 ERISA Plans
ARTICLE 7 NEGATIVE COVENANTS.
Section 7.1 Debt
Section 7.2 Liens
Section 7.3 Investments
Section 7.4 Sale of Assets
Section 7.5 Stock of Subsidiaries, Etc.
Section 7.6 Transactions with Affiliates
Section 7.7 Mergers, Etc.
Section 7.8 Acquisitions
ARTICLE 8 FINANCIAL COVENANTS.
Section 8.1 Minimum Net Worth
Section 8.2 Leverage Ratio
Section 8.3 Interest Coverage Ratio
ARTICLE 9 EVENTS OF DEFAULT.
Section 9.1 Events of Default
Section 9.2 Remedies
ARTICLE 10 THE ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS AND BORROWER.
Section 10.1 Appointment, Powers and Immunities of
Administrative Agent
Section 10.2 Reliance by Administrative Agent
Section 10.3 Defaults
Section 10.4 Rights of Administrative Agent as a Bank
Section 10.5 Indemnification of Administrative Agent
Section 10.6 Documents
Section 10.7 Non-Reliance on Administrative Agent and Other Banks
Section 10.8 Failure of Administrative Agent to Act
Section 10.9 Resignation or Removal of Administrative Agent
Section 10.10 Amendments Concerning Agency Function
Section 10.11 Liability of Administrative Agent
Section 10.12 Transfer of Agency Function
Section 10.13 Non-Receipt of Funds by the Administrative Agent
Section 10.14 Withholding Taxes
Section 10.15 Several Obligations and Rights of Banks
Section 10.16 Pro Rata Treatment of Loans, Etc.
Section 10.17 Sharing of Payments Among Banks
ARTICLE 11 MISCELLANEOUS
Section 11.1 Amendments and Waivers
Section 11.2 Usury
Section 11.3 Expenses; Taxes
Section 11.4 Survival
Section 11.5 Assignment; Participations
Section 11.6 Notices
Section 11.7 Setoff
Section 11.8 Indemnification; Exoneration
Section 11.9 Jurisdiction; Immunities
Section 11.10 Table of Contents; Headings
Section 11.11 Severability
Section 11.12 Counterparts
Section 11.13 Integration
Section 11.14 Governing Law
Section 11.15 Confidentiality
Section 11.16 Treatment of Certain Information
Section 11.17 Changes in Accounting Principles
Section 11.18 Independence of Covenants
Section 11.19 Time of the Essence
EXHIBITS
Exhibit A Syndicated Note
Exhibit B Money Market Note
Exhibit C Money Market Confirmation
Exhibit D-1 Money Market Quote -- LIBOR Auction
Exhibit D-2 Money Market Quote -- Set Rate Auction
Exhibit E-1 Money Market Quote Request -- LIBOR Market Loans
Exhibit E-2 Money Market Quote Request -- Set Rate Loans
Exhibit F Authorization Letter
Exhibit G Confidentiality Agreement
Exhibit H Opinion of Counsel for Borrower
Exhibit I Notice of Borrowing
Exhibit J Financial Covenants Compliance Report
SCHEDULES
Schedule 5.5 Financial Statements
Schedule 5.7 Taxes
Schedule 5.8 ERISA
Schedule 5.9 Subsidiaries of Borrower
Schedule 5.10 Credit Arrangements
Schedule 5.12 Hazardous Materials
Schedule 5.17 Insurance
Schedule 7.2 Liens
CREDIT AGREEMENT dated as of March 26, 1996 among CUC INTERNATIONAL INC., a
corporation organized under the laws of the State of Delaware (the "Borrower"),
each of the banks which is a signatory hereto (individually a "Bank" and
collectively the "Banks"), THE CHASE MANHATTAN BANK, N.A., BANK OF MONTREAL,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK and THE SAKURA BANK, LIMITED, as
agents for the Banks (collectively, in such capacity, the "Co-Agents") and THE
CHASE MANHATTAN BANK, N.A., as administrative agent for the Banks (in such
capacity, together with its successors in such capacity, the "Administrative
Agent").
The Borrower desires that the Banks extend credit as provided herein and
the Banks are prepared to extend such credit. Accordingly, the Borrower, the
Banks, the CoAgents and the Administrative Agent agree as follows:
ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS.
Section 1.1 Definitions. As used in this Agreement the following terms have
the following meanings (terms defined in the singular to have a correlative
meaning when used in the plural and vice versa):
"Acceptable Acquisition" means any Acquisition satisfying all of the
following conditions:
(a) no Default or Event of Default exists or is continuing and no Default
or Event of Default would result from such Acquisition;
(b) the business or Person acquired directly or indirectly is involved in
the provision of consumer goods or services, which shall include the primary
types of businesses conducted by the Borrower and its Subsidiaries as of the
date hereof;
(c) on a consolidated basis with the acquired business or Person, the ratio
of (a) Debt of the Borrower together with the Debt of such acquired business or
Person outstanding on the date of such Acquisition to (b) EBITDA of the Borrower
and such acquired business or Person, such EBITDA measured: (i) on a trailing
four quarters basis as of the end of the immediately preceding fiscal quarter
and (ii) as if such acquired business or Person was owned by the Borrower or any
Subsidiary during such four quarter period, shall not exceed 3.0 to 1.0;
(d) the Borrower, on a consolidated basis with the acquired business or
Person , would have been in compliance with the financial covenants contained in
Article 8 on a trailing four quarters basis as of the end of the immediately
preceding fiscal quarter and as if such acquired business or Person was owned by
the Borrower or any Subsidiary during such four quarter period; and
(e) the Borrower has provided computations showing compliance with
subsections (c) and (d) above to the Administrative Agent upon its request. The
Administrative Agent shall provide copies of such computations to the Banks
following its receipt thereof.
Notwithstanding the foregoing, an Acquisition for less than $15,000,000 in
Total Consideration which does not satisfy subsection (b) above shall be deemed
an Acceptable Acquisition if it satisfies the remaining subsections above.
"Acquisition" means any transaction or series of related transactions
pursuant to which the Borrower or any of its Subsidiaries (a) acquires 50% or
more of the equity securities (or warrants, options or other rights to acquire
such securities) of any Person other than the Borrower or any Person which is
not then a Subsidiary of the Borrower, pursuant to a solicitation of tenders
therefor, or in one or more negotiated block, market or other transactions not
involving a tender offer, or a combination of any of the foregoing, or (b) makes
any Person a Subsidiary of the Borrower, or causes any such Person to be merged
into the Borrower or any of its Subsidiaries, in any case pursuant to a merger,
purchase of assets or any reorganization providing for the delivery or issuance
to the holders of such Person's then outstanding securities, in exchange for
such securities, of cash or securities of the Borrower or any of its
Subsidiaries, or a combination thereof, or (c) purchases all or substantially
all of the business or assets of any Person, or (d) otherwise acquires or
establishes Control over a Person.
"Affiliate" means any Person: (a) which directly or indirectly Controls, or
is Controlled by, or is under common Control with, the Borrower or any of its
Subsidiaries; (b) which directly or indirectly beneficially owns or holds 10% or
more of any class of voting stock of the Borrower or any such Subsidiary; (c)
10% or more of the voting stock of which is directly or indirectly beneficially
owned or held by the Borrower or such Subsidiary; or (d) which is a partnership
in which the Borrower or any of its Subsidiaries is a general partner.
"Agreement" means this Credit Agreement, as amended or supplemented from
time to time. References to Articles, Sections, Exhibits, Schedules and the like
refer to the Arti cles, Sections, Exhibits, Schedules and the like of this
Agreement unless otherwise indicated.
"Authorization Letter" means the letter agreement executed by the Borrower
in the form of Exhibit F.
"Banking Day" means any day on which commercial banks are not authorized or
required to close in New York City and whenever such day relates to a LIBO Rate
Loan or notice with respect to any LIBO Rate Loan, a day on which dealings in
Dollar deposits are also carried out in the London interbank market.
"Capital Lease" means any lease which has been or should be capitalized on
the books of the lessee in accordance with GAAP.
"Cash Equivalent Investments" means any of the following, to the extent
acquired for investment and not with a view to achieving trading profits: (a)
obligations fully backed by the full faith and credit of the United States of
America maturing not in excess of twelve months from the date of acquisition,
(b) commercial paper maturing not in excess of twelve months from the date of
acquisition and rated "P-1" by Moody's or "A-1" by S&P on the date of such
acquisition, (c) the following obligations of any Bank or any domestic
commercial bank having capital and surplus in excess of $500,000,000, which has,
or the holding company of which has, a commercial paper rating meeting the
requirements specified in clause (b) above: (i) time deposits, certificates of
deposit and acceptances maturing not in excess of twelve months from the date of
acquisition, or (ii) repurchase obligations with a term of not more than thirty
(30) days for underlying securities of the type referred to in clause (a) above,
(d) money market funds that invest exclusively in interest bearing, shortterm
money market instruments: (i) having an average remaining maturity of not more
than twelve months and (ii) (A) rated at least "P1" by Moody's or "A-1" by S&P
or (B) which are issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof, and (f)
municipal securities: (i) for which the pricing period in effect is not more
than twelve months long and (ii) rated at least "P-1" by Moody's or "A-1" by
S&P.
"Closing Date" means the date this Agreement has been executed by the
Borrower, the Banks, the CoAgents and the Administrative Agent.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Commitment" means, with respect to each Bank, the obligation of such Bank
to make its Loans under this Agreement in the aggregate principal amount
following, as such amount may be reduced or otherwise modified from time to
time:
The Chase Manhattan Bank, N.A.: $60,000,000;
Bank of Montreal: $50,000,000;
Morgan Guaranty Trust Company of New York: $50,000,000;
The Sakura Bank, Limited: $50,000,000;
ABN AMRO Bank N.V. New York Branch: $25,000,000;
The Bank of New York: $25,000,000;
First American National Bank: $25,000,000;
First Union National Bank: $25,000,000;
Fleet National Bank of Connecticut: $25,000,000;
The Industrial Bank of Japan Trust Company: $25,000,000;
Mellon Bank, N.A.: $25,000,000;
The Mitsubishi Bank, Limited: $25,000,000;
Royal Bank of Canada: $25,000,000;
The Sanwa Bank, Ltd.: $25,000,000;
The Sumitomo Bank, Limited, New York Branch: $25,000,000;
The Fuji Bank, Limited New York Branch: $15,000,000;
Total: $500,000,000.
"Consolidated Subsidiary" means any Subsidiary of a Person whose accounts
are or are required to be consolidated with the accounts of such Person in
accordance with GAAP.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract, or otherwise.
"Debt" means, with respect to any Person at any date (without duplication):
(a) indebtedness created, issued, incurred or assumed by such Person for
borrowed money or evidenced by bonds, debentures, notes or similar instruments;
(b) all obligations of such Person to pay the deferred purchase price of
property or services six (6) months or more from the date of the occurrence or
as evidenced by a note or similar written instrument, excluding, however, trade
accounts payable (other than for borrowed money) arising in, and accrued
expenses incurred in, the ordinary course of business of such Person; (c) all
Debt of others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person; (d) all Debt of others Guaranteed by such
Person; (e) all obligations of such Person as lessee under Capital Leases; (f)
reimbursement obligations of such Person (whether contingent or otherwise) in
respect of bankers acceptances, surety or other bonds and similar instruments
(other than commercial, standby or performance letters of credit); (g)
contingent obligations under swaps, derivatives, currency exchanges and similar
transactions; and (h) unpaid reimbursement obligations of such Person (other
than contingent obligations) in respect of commercial, standby or performance
letters of credit. For the purposes of calculating Debt only for compliance with
the financial covenants set forth in Article VIII and the definitions of
"Acceptable Acquisition" and "Leverage Ratio", Debt shall not include contingent
obligations under surety or other bonds.
"Debt Rating" shall have the meaning given such term in Section 2.13.
"Default" means any event which with the giving of notice or lapse of time,
or both, would become an Event of Default.
"Default Rate" means, (i) with respect to the principal of any Loan, a rate
per annum equal to 2% above the interest rate for such Loan as provided in
Section 2.10, and (ii) with respect to any other amount payable by the Borrower
under this Agreement or any Note, to the extent permitted by law, a rate per
annum equal to 2% above the Variable Rate as in effect from time to time;
provided, that clause (ii) shall not be interpreted to
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provide for an increase in the facility fee rate to 2% above the Variable Rate
as in effect from time to time.
"Dollars" and the sign "$" mean lawful money of the United States of
America.
"EBIT" means, for any Person, for any period, earn ings before Interest
Expense, taxes, extraordinary items and transaction costs and other
non-recurring costs directly related to Acceptable Acquisitions for such Person
determined on a consolidated basis in accordance with GAAP.
"EBITDA" means, for any Person, for any period, earnings before Interest
Expense, taxes, depreciation, amortization, extraordinary items and transaction
and other non-recurring costs directly related to Acceptable Acquisitions for
such Person determined on a consolidated basis in accordance with GAAP.
"Environmental Affiliate" means, as to any Person, any other Person whose
liability (contingent or otherwise) for any Environmental Claim such Person may
have retained, assumed or otherwise become liable (contingently or otherwise),
whether by contract, operation of law or otherwise; provided that each
Subsidiary of such Person, and each former Subsidiary or division of such Person
transferred to another Person, shall in any event be an "Environmental
Affiliate" of such Person.
"Environmental Claim" means, with respect to any Person, any notice, claim,
demand or other communication (whether written or oral) by any other Person
alleging or asserting liability of such Person for investigatory costs, cleanup
costs, governmental response costs, damages to natural resources or other
Property, personal injuries, fines or penalties arising out of, based on or
resulting from (a) the presence, or release into the environment, of any
hazardous material at any location, whether or not owned by such Person, or (b)
circumstances forming the basis of any violation, or alleged violation, of any
Environmental Law.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, regulations, ordi nances, rules, judgments, orders, decrees,
permits, conces sions, grants, franchises, licenses, agreements or other gov
ernmental restrictions relating to the environment or to emissions, discharges,
releases or threatened releases of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes.
"ERISA" means the Employee Retirement Income Secu rity Act of 1974, as
amended from time to time, including any applicable rules and regulations
promulgated thereunder.
"ERISA Affiliate" means any corporation or trade or business which is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which the Borrower is a member, or (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which the
Borrower is a member.
"Eurodollar Loan" means any Syndicated Loan when and to the extent the
interest rate therefor is determined on the basis of the LIBO Base Rate.
"Event of Default" has the meaning given such term in Section 9.1.
"Facility Documents" means this Agreement, the Notes, the Money Market
Quote Requests, the Money Market Confirmations, the Authorization Letter and
each of the documents, certificates or other instruments referred to in Article
4 hereof as well as any other documents, instrument or certificate to be
delivered by the Borrower in connection with this Agreement or in connection
with the documents, certificates or instruments referred to in Article 4,
including documents delivered in connection with any borrowing.
"Federal Funds Rate" means, for any day, the rate per annum (expressed on a
365/366 day basis of calculation) equal to the weighted average of the rates on
overnight federal funds transactions as published by the Federal Reserve Bank of
New York for the immediately preceding Banking Day.
"Forfeiture Proceeding" means any action, proceeding or investigation
affecting the Borrower or any of its Subsidiaries before any Governmental
Authority, or the receipt of notice by any such party that any of them is a
suspect in or a target of any governmental inquiry or investigation, which may
result in an indictment of any of them or the seizure or forfeiture of any of
their property.
"GAAP" means generally accepted accounting princi ples in the United States
of America as in effect from time to time, applied on a basis consistent with
those used in the preparation of the financial statements referred to in Section
5.5 (except for changes concurred in by the Borrower's independent public
accountants).
"Governmental Authority" shall mean any government or political subdivision
or an agency, authority, bureau, central bank, commission, department or
instrumentality of either, or any court, tribunal, grand jury or arbitrator, in
each case whether foreign or domestic.
"Guarantee" means, for any Person, (i) any guarantee, endorsement,
contingent agreement to purchase or to furnish funds for the payment or
maintenance of, or any other contingent liability on or with respect to, the
Debt, other obligations, net worth, working capital or earnings of any other
Person (including, without limitation, the liability of such Person in respect
of the Debt of any partnership of which such person is a general partner), or
(ii) the guarantee by such Person of the payment of dividends or other
distributions upon the stock of any other Person, or the agreement by such
Person to purchase, sell or lease (as lessee or lessor) property, products,
materials, supplies or services primarily for the purpose of enabling any other
Person to make payment of its obligations or to assure a creditor against loss,
provided, however, that the term "Guarantee" shall not include a guarantee of
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performance by the Borrower or any of its Subsidiaries in the ordinary course of
its business or the guarantee of payment of Debt of the Borrower or any
Subsidiary to the Borrower or another Subsidiary . The verb "Guarantee" shall
have a correlative meaning, provided that the term "Guarantee" shall not include
endorsements for collection or deposits in the ordinary course of business.
"Interest Coverage Ratio" means, for any Person, as at any date, the ratio
of (a) EBIT of such Person for the immediately preceding four full fiscal
quarters of such Per son (including the fiscal quarter ending on such date if
such date is the last day of a fiscal quarter) to (b) Interest Expense of such
Person for such period.
"Interest Expense" shall mean, with respect to any Person, for any period,
the sum, for such Person in accordance with GAAP, of (a) all interest on Debt
that is accrued as an expense during such period (including, without limita
tion, imputed interest on Capital Leases), plus (b) all amounts paid, accrued or
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amortized as an expense during such period in respect of interest rate
protection agreements, minus (c) all amounts received or accrued as income
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during such period in respect of interest rate protection agreements. "Interest
Period" means:
(a) With respect to any Eurodollar Loan, the period commencing on the date
such Eurodollar Loan is made, converted from another type of Loan or renewed, as
the case may be, and ending on the numerically corresponding day in the first,
second, third or sixth calendar month thereafter, as the Borrower may select
pursuant to Section 2.6, provided that each such Interest Period which commences
on the last Banking Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall end on the last Banking Day of the appropriate subsequent calendar month.
(b) With respect to any Set Rate Loan, the period commencing on the date
such Set Rate Loan is made and ending on any Banking Day up to 180 days
thereafter, as the Borrower may select pursuant to Section 2.4.
(c) With respect to any LIBOR Market Loan, the period commencing on the
date such LIBOR Market Loan is made and ending on the numerically corresponding
day in the first, second, third or sixth calendar month thereafter, as mutually
agreed by the Borrower and a Bank pursuant to Section 2.4, provided that each
such Interest Period which commences on the last Banking Day of a calendar month
(or on any day for which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall end on the last Banking Day of the
appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period would otherwise
commence before and end after the Termination Date, such Interest Period shall
end on the Termination Date; (ii) each Interest Period which would otherwise end
on a day which is not a Banking Day shall end on the next succeeding Banking Day
(or, in the case of an Interest Period for any LIBO Rate Loans, if such next
succeeding Banking Day falls in the next succeeding calendar month, on the next
preceding Banking Day); and (iii) notwithstanding clause (i) above, no Interest
Period shall have a duration of less than one month (in the case of a LIBO Rate
Loan) or 7 days (in the case of a Set Rate Loan), and, if the Interest Period
for any such Loans would otherwise be for a shorter period, such Loans shall not
be available hereunder.
"LIBO Base Rate" means, with respect to any Interest Period for a LIBO Rate
Loan, the arithmetic mean, as calculated by the Administrative Agent, of the
respective rates per annum (rounded upwards, if necessary, to the nearest 1/16
of 1%) quoted at approximately 11:00 a.m. London time by the principal London
branch of each of the Reference Banks two Banking Days prior to the first day of
such Interest Period for the offering to leading banks in the London interbank
market of Dollar deposits in immediately available funds, for a period, and in
an amount, comparable to the Interest Period and principal amount of the LIBO
Rate Loan which shall be made by such Reference Bank and outstanding during such
Interest Period; provided, that, in determining the LIBO Base Rate with respect
to any LIBOR Market Loan, each Reference Bank shall be deemed to have made a
LIBOR Market Loan in an amount equal to $1,000,000.
"LIBO Margin" shall have the meaning given such term in Section 2.4(b).
"LIBO Rate" means, for any LIBO Rate Loan for any Interest Period therefor,
a rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined by the Administrative Agent to be equal to the quotient of (i) the
LIBO Base Rate for such Loan for such Interest Period, divided by (ii) one minus
the Reserve Requirement for such Loan for such Interest Period.
"LIBO Rate Loans" shall mean Eurodollar Loans and LIBOR Market Loans.
"LIBOR Auction" means a solicitation of Money Market Quotes setting forth
LIBO Margins based on the LIBO Rate pursuant to Section 2.4.
"LIBOR Market Loans" means Money Market Loans the interest rates on which
are determined on the basis of LIBO Rates pursuant to a LIBOR Auction.
"Lending Office" means, for each Bank and for each type of Loan, the
lending office of such Bank (or of an affil iate of such Bank) designated as
such for such type of Loan on its signature page hereof or such other office of
such Bank (or of an affiliate of such Bank) as such Bank may from time to time
specify to the Administrative Agent and the Borrower as the office by which its
Loans of such type are to be made and maintained.
"Leverage Ratio" means, for any Person, as at any date, the ratio of (a)
Debt of such Person as at the end of such Person's most recently completed full
fiscal quarter to (b) EBITDA of such Person for the immediately preceding four
full fiscal quarters of such Person on a consolidated basis (including the
fiscal quarter ending on such date if such date is the last day of a fiscal
quarter).
"Lien" means any lien (statutory or otherwise), security interest,
mortgage, deed of trust, priority, pledge, negative pledge, charge, conditional
sale, title retention agreement, financing lease or other encumbrance or similar
right of others, or any agreement to give or refrain from giving any of the
foregoing.
"Loan" means any Syndicated Loan or Money Market Loan.
"Margin" means, for a Eurodollar Loan, the margin for such type of Loan
that would apply under Section 2.13.
"Material Adverse Effect" means (a) a material adverse effect on the
business, operations, management, property or financial condition of the
Borrower and its Subsidiaries, taken as a whole, (b) a material adverse effect
on the ability of the Borrower or any of its Subsidiaries to perform or comply
with any of the terms and conditions of this Agreement, any Note or any other
Facility Document, or (c) a material adverse effect on the legality, validity,
binding effect, enforceability or admissibility into evidence of this Agreement,
any Note or any other Facility Document, or the ability of the Administrative
Agent or any Bank to enforce any rights or remedies under or in connection with
this Agreement, any Note or any other Facility Document.
"Material Subsidiary" means, at any time, any Subsidiary of the Borrower
that satisfies at least one of the following conditions:
(a) the portion of the aggregate total fixed and current assets of the
Borrower and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP, attributable to such Subsidiary pursuant to GAAP is 10% or more;
(b) the portion of operating income of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP, attributable to such
Subsidiary pursuant to GAAP is 10% or more; or
(c) the performance of the Subsidiary could, for any other reason, be
considered material to the interests of the Borrower.
"Money Market Borrowing" shall have the meaning given such term in Section
2.4(b).
"Money Market Confirmation" means each confirmation by the Borrower of its
acceptance of Money Market Quotes, which Money Market Confirmation shall be
substantially in the form of Exhibit C and shall be delivered to the
Administrative Agent in writing or by facsimile transmission.
"Money Market Loan Limit" shall have the meaning given such term in Section
2.4(b)(iii)(C).
"Money Market Loans" shall have the meaning given such term in Section
2.1(b).
"Money Market Note" shall have the meaning given such term in Section
2.2(b).
"Money Market Quote" means each offer by a Bank to make Money Market Loans
pursuant to a Money Market Quote Request, which Money Market Quote shall contain
the information specified in, as appropriate, Exhibit D-1 or Exhibit D-2 and
shall be delivered to the Administrative Agent by telephone, immediately
confirmed by facsimile transmission.
"Money Market Quote Request" means each request by the Borrower for Banks
to submit bids to make Money Market Loans, which shall contain the information
in respect of such requested Money Market Loans specified in, as appropriate,
Exhibit E-1 or Exhibit E-2 and shall be delivered to the Administrative Agent in
writing or by facsimile transmission, or by telephone, immediately confirmed by
facsimile transmission.
"Money Market Rate" shall have the meaning given such term in Section 2.4.
"Moody's" means Moody's Investors Service, Inc. and any successor thereto that
is a nationally recognized rating agency.
"Multiemployer Plan" means a Plan defined as such in Section 3(37) of ERISA
to which contributions have been made by the Borrower or any ERISA Affiliate and
which is covered by Title IV of ERISA.
"Net Income" for any period means the net income (loss) of Borrower and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP.
"Net Worth" means, with respect to any Person, at any time, the
stockholders' equity of such Person and its Consolidated Subsidiaries determined
on a consolidated basis in accordance with GAAP.
"Note" means each Syndicated Note and each Money Market Note.
"Notice of Borrowing" shall mean the notice of each borrowing required by
Section 4.2.
"PBGC" means the Pension Benefit Guaranty Corpora tion and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corpora tion, business trust,
joint stock company, trust, unincorporated association, joint venture, limited
liability company, Governmental Authority or other entity of whatever nature.
"Plan" means any employee benefit or other plan established or maintained, or to
which contributions have been made, by the Borrower or any ERISA Affiliate and
which is covered by Title IV of ERISA, other than a Multiemployer Plan.
"Prime Rate" means that rate of interest from time to time announced by the
Principal Reference Bank at its principal office as its prime commercial lending
rate.
"Principal Office" means the principal office of the Administrative Agent,
presently located at One Chase Manhattan Plaza, New York, New York 10082.
"Principal Reference Bank" means The Chase Manhattan Bank, N.A.
"Property" means any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible
(including, without limitation, shares of capital stock).
"Quotation Date" shall have the meaning given such term in Section 2.4(b).
"Reference Banks" means The Chase Manhattan Bank, N.A. and Morgan Guaranty
Trust Company of New York.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Regulatory Change" means, with respect to any Bank, any change after the
date of this Agreement in United States federal, state, municipal or foreign
laws or regulations (including without limitation Regulation D) or the adoption
or making after such date of any interpretations, directives or requests
applying to a class of banks including such Bank of or under any United States,
federal, state, municipal or foreign laws or regulations (whether or not having
the force of law) by any Governmental Authority or monetary authority charged
with the interpretation or administration thereof.
"Required Banks" means Banks having at least 51% of the aggregate amount of
the Commitments and, at any time after the Commitments shall have terminated,
Banks holding at least 51% of the aggregate principal amount of the Loans.
"Reserve Requirement" means, for any Interest Period for any LIBO Rate
Loan, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by member banks of the Federal Reserve System
in New York City with deposits exceeding $1,000,000,000 against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting the effect
of the foregoing, the Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the LIBO Base Rate for LIBO Rate Loans is to be determined as
provided in the definition of "LIBO Base Rate" in this Section 1.1 or (ii) any
category of extensions of credit or other assets which include LIBO Rate Loans.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw-Hill,
Inc. and any successor thereto which is a nationally recognized rating agency.
"Set Rate Auction" means a solicitation of Money Market Quotes setting
forth Money Market Rates pursuant to Section 2.4.
"Set Rate Loans" means Money Market Loans the interest rates on which are
determined on the basis of Money Market Rates pursuant to a Set Rate Auction.
"Subsidiary" means, with respect to any Person, any corporation or other
entity (a) of which at least a majority of the securities or other ownership
interests having ordinary voting power (absolutely or contingently) for the
election of directors or other persons performing similar functions are at the
time owned directly or indirectly by such Person or (b) with respect to which
such Person otherwise possesses Control.
"Syndicated Loan" shall have the meaning given such term in Section 2.1(a).
"Syndicated Note" shall have the meaning given such term in Section 2.2.
"Termination Date" means March 26, 2001; provided that if such date is not
a Banking Day, the Termination Date shall be the next succeeding Banking Day
(or, if such next succeeding Banking Day falls in the next calendar month, the
next preceding Banking Day).
"Total Consideration" means:
(a) with respect to the Acquisition of any assets, the purchase price of
such assets; and
(b) with respect to the Acquisition of equity securities of any Person, the
sum of (i) the purchase price of such equity securities plus (ii) Debt assumed,
accounts payable and accrued expenses reflected on the balance sheet of such
acquired Person minus (iii) cash, Cash Equivalent Investments and accounts
receivable reflected on the balance sheet of such acquired Person.
"Unfunded Benefit Liabilities" means, with respect to any Plan, the amount
(if any) by which the present value of all benefit liabilities (within the
meaning of Section 4001(a)(16) of ERISA) under the Plan exceeds the fair market
value of all Plan assets allocable to such benefit liabili ties, as determined
on the most recent valuation date of the Plan and in accordance with the
provisions of ERISA for calcu lating the potential liability of the Borrower or
any ERISA Affiliate under Title IV of ERISA.
"Variable Rate" means, for any day, the higher of (a) the Federal Funds
Rate for such day plus 1/2 of 1% and (b) the Prime Rate for such day.
"Variable Rate Loan" means any Syndicated Loan when and to the extent the
interest rate for such Syndicated Loan is determined in relation to the Variable
Rate.
Section 1.2. Accounting Terms. All accounting terms not specifically
----------------
defined herein shall be construed in accordance with GAAP, and all financial
data required to be delivered hereunder shall be prepared in accordance with
GAAP.
Section 1.3. Rules of Interpretation.
-----------------------
(a) A reference to any document or agreement shall include such document or
agreement as amended, modified or supplemented from time to time in accordance
with its terms and the terms of this Agreement.
(b) The singular includes the plural and the plural includes the singular.
(c) A reference to any law includes any amendment or modification to such
law.
(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) The words "include", "includes" and "including" are not limiting.
(f) The words "herein", "hereof", "hereunder" and words of like import
shall refer to this Agreement as a whole and not to any particular section or
subdivision of this Agreement.
ARTICLE 2. THE CREDIT.
Section 2.1. The Loans.
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(a) Subject to the terms and conditions of this Agreement, each of the
Banks severally agrees to make loans (the "Syndicated Loans") to the Borrower
from time to time from and including the date hereof to and including the
Banking Day immediately prior to the Termination Date, up to but not exceeding
in the aggregate principal amount at any one time outstanding, the amount of its
Commitment; provided, that the aggregate outstanding principal amount of Loans
shall at no time exceed the aggregate amount of the Commitments. The Syndicated
Loans may be outstanding as Variable Rate Loans or Eurodollar Loans (each a
"type" of Syndicated Loans). Each type of Syndicated Loans of each Bank shall be
made and maintained at such Bank's Lending Office for such type of Syndicated
Loans. The Syndicated Loans shall be due and payable on the Termination Date.
(b) The Borrower may request uncommitted competitive auction facility
advances (the "Money Market Loans") from time to time on any Banking Day during
the period from the date hereof to the date occurring 14 days prior to the
Termination Date in the manner set forth in Section 2.4(b) and in amounts such
that the aggregate amount
of Loans outstanding at any time shall not exceed the aggregate amount of the
Commitments at such time. Each Money Market Loan shall be due and payable on the
last day of the Interest Period therefor.
Section 2.2. The Notes.
---------
(a) The Syndicated Loans of each Bank shall be evidenced by a single
promissory note in favor of each such Bank in the form of Exhibit A, dated the
date of this Agreement, duly completed and executed by the Borrower (a
"Syndicated Note"). Each Bank is hereby authorized to record the date, amount
and type of each Syndicated Loan made by such Bank to the Borrower and the date
and amount of each payment of principal thereof on the schedule annexed to and
constituting part of its Syndicated Note from the Borrower, or to otherwise
record in its internal records, and any such recordation shall constitute prima
facie evidence of the accuracy of the information so recorded; provided,
however, that the failure to make any such recordation (or any error therein)
shall not affect the obligations of the Borrower hereunder or under its
Syndicated Note. Each Syndicated Loan evidenced by each Syndicated Note shall
bear interest for the period from and including the date of the Syndicated Loan
thereof on the unpaid principal amount thereof from time to time outstanding at
the applicable rate per annum determined as provided in, and such interest shall
be payable as specified in, Section 2.10.
(b) The Money Market Loans made by each Bank to the Borrower shall be
evidenced initially by a single promissory note of the Borrower in favor of each
such Bank in the form of Exhibit B, dated the date of this Agreement, duly
completed and executed by the Borrower (a "Money Market Note"). Each Bank is
hereby authorized to record the date, amount, type and maturity date of each
Money Market Loan made by such Bank to the Borrower, the date and amount of each
payment of principal thereof and the interest rate with respect thereto on the
schedule annexed to and constituting part of its Money Market Note from the
Borrower, or to otherwise record in its internal records, and any such
recordation shall constitute prima facie evidence of the accuracy of the
information so recorded; provided, however, that the failure to make any such
recordation (or any error therein) shall not affect the obligations of the
Borrower hereunder or under its Money Market Note. Each Money Market Loan
evidenced by each Money Market Note shall bear interest for the period from and
including the date of the Money Market Loan thereof on the unpaid principal
amount thereof from time to time outstanding at the applicable rate per annum
determined as provided in, and such interest shall be payable as specified in,
Section 2.10(d).
Section 2.3. Purpose. The Borrower shall use the proceeds of the Loans for
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general corporate purposes, which may include Acceptable Acquisitions, Cash
Equivalent Investments, the repurchase of the Borrower's outstanding common
stock and other investments permitted under Section 7.3. Such proceeds shall not
be used for the purpose, whether immediate, incidental or ultimate, of buying or
carrying "margin stock" within the meaning of Regulation U, other than in
compliance with Regulation U.
Section 2.4. Borrowing Procedures.
--------------------
(a) The Borrower shall give the Administrative Agent notice of each
Syndicated Loan to be made hereunder as provided in Section 2.8. Not later than
1:00 p.m. New York City time on the date of such Syndicated Loan, each Bank
shall, through its Lending Office and subject to the conditions of this
Agreement, make the amount of the Syndicated Loan to be made by it on such day
available to the Administrative Agent at the Principal Office and in immediately
available funds for the account of the Borrower. The amount so received by the
Administrative Agent shall, as soon as practicable on such date, subject to the
conditions of this Agreement, be made available to the Borrower, in immediately
available funds, by the Administrative Agent crediting an account of the
Borrower designated by the Borrower and maintained with the Administrative Agent
at the Principal Office.
(b) (i) In addition to borrowings of Syndicated Loans, at any time at
least 14 days prior to the Termination Date the Borrower may, as set forth
herein, request the Banks to make offers to make Money Market Loans to the
Borrower in Dollars. The Banks may, but shall not have the obligation to, make
any such offers and the Borrower may, but shall have no obligation to, accept
any such offers in the manner set forth herein. Money Market Loans may be LIBOR
Market Loans or Set Rate Loans, provided that the aggregate unpaid principal
amount of all Money Market Loans, together with the aggregate unpaid principal
amount of all Syndicated Loans, at any one time outstanding shall not exceed
the aggregate amount of the Commitments at such time.
(ii) The Borrower shall request Money Market Loans by delivering a
Money Market Quote Request to the Administrative Agent, not later than 10:00
a.m. New York City time (x) four (4) Banking Days prior to the date of the
proposed Money Market Loan in the case of a LIBOR Auction or (y) one (1)
Banking Day prior to the date of the proposed Money Market Loan in the case of
a proposed Set Rate Auction (or, in any such case, such other time and date as
the Borrower and the Administrative Agent, with the consent of the Required
Banks, may agree). The Borrower may request offers to make both LIBOR Market
Loans and Set Rate Loans and an aggregate of up to four different Interest
Periods in a single notice (for which purpose Interest Periods in different
lettered clauses of the definition of the term "Interest Period" shall be
deemed to be different Interest Periods even if they are coterminous); provided
that the request for each separate Interest Period shall be deemed a separate
Money Market Quote Request for a separate borrowing (a "Money Market
Borrowing"). Each such notice shall be substantially in the form of Exhibit E-1
or E-2 hereto and shall specify as to each Money Market Borrowing:
(A) the proposed date of such borrowing, which shall be a
Banking Day;
(B) the aggregate amount of such Money Market Borrowing, which
shall be at least $5,000,000 (or a higher integral multiple of $1,000,000) but
which shall not cause the limits in clause (b)(i) above to be violated;
(C) the Interest Period applicable thereto;
(D) whether the Money Market Quote Requests requested for a
particular Interest Period are seeking quotes for LIBOR Market Loans or Set Rate
Loans; and
(E) if the Money Market Quote Requests are seeking quotes for Set
Rate Loans, the date on which the Money Market Quotes are to be submitted if it
is before the proposed date of borrowing (the date on which such Money Market
Quotes are to be submitted is called the "Quotation Date").
Except as otherwise provided in this clause (b)(ii), no Money Market Quote
Request shall be given within five (5) Banking Days (or such other number of
days as the Borrower and the Administrative Agent, with the consent of the
Required Banks, may agree) of any other Money Market Quote Request.
(iii) (A) Any Bank that elects, in its sole discretion, to do so, shall
irrevocably offer to make one or more Money Market Loans in response to any
Money Market Quote Request; provided that, if the Borrower's request under
clause (b)(ii) above specified more than one Interest Period, such Bank may make
a single submission containing one or more Money Market Quotes for each such
Interest Period. Each such Money Market Quote must be submitted to the
Administrative Agent, before (x) 2:00 p.m. New York City time on the fourth
Banking Day prior to the proposed date of borrowing, in the case of a LIBOR
Auction or (y) 10:00 a.m. New York City time on the Quotation Date, in the case
of a Set Rate Auction (or, in any such case, such other time and date as the
Borrower and the Administrative Agent, with the consent of the Required Banks,
may agree); provided that any Money Market Quote may be submitted by the
Administrative Agent in its role as a Bank (or its applicable Lending Office)
only if the Administrative Agent (or such applicable Lending Office) notifies
the Borrower of the terms of the offer contained therein not later than (x) 1:45
p.m. New York City time on the fourth Banking Day prior to the proposed date of
the borrowing, in the case of a LIBOR Market Loan or (y) 9:45 a.m. New York City
time on the Quotation Date, in the case of a Set Rate Loan. Subject to Sections
3.2(b), 3.3, 4.2 and 9.2 hereof, any Money Market Quote so made shall be
irrevocable except with the consent of the Administrative Agent given on the
instructions of the Borrower.
(B) Each Money Market Quote shall be substantially in the form of
Exhibit D-1 or D-2 hereto and shall specify:
(1) the proposed date of the borrowing and the Interest
Period therefor;
(2) the principal amount of the Money Market Loan for which
such offer is being made, which principal amount shall be at least $5,000,000
(or a higher integral multiple of $1,000,000); provided, that the aggregate
principal amount of all Money Market Loans for which a Bank submits Money Market
Quotes (x) may be greater or less than the Commitment of such Bank but (y) may
not exceed the principal amount of the Money Market Borrowing for a particular
Interest Period for which offers were requested;
(3) in the case of a LIBOR Auction, the margin above or
below the applicable LIBO Rate (the "LIBO Margin") offered for each such Money
Market Loan, expressed as a percentage (quoted to the nearest 1/10,000th of 1%)
to be added to or subtracted from the applicable LIBO Rate;
(4) in the case of a Set Rate Loan, the rate of interest
per annum (quoted to the nearest 1/10,000th of 1%) offered for each such Money
Market Loan (the "Money Market Rate"); and
(5) the identity of the quoting Bank.
(C) Unless otherwise agreed by the Administrative Agent and the
Borrower, no Money Market Quote shall contain qualifying, conditional or similar
language or propose terms other than or in addition to those set forth in the
applicable Money Market Quote Request and, in particular, no Money Market Quote
may be conditioned upon acceptance by the Borrower of all (or some specified
minimum) of the principal amount of the Money Market Loan for which such Money
Market Quote is being made, provided that the submission by any Bank containing
more than one Money Market Quote may be conditioned on the Borrower not
accepting offers contained in such submission that would result in such Bank
making Money Market Loans pursuant thereto in excess of a specified aggregate
amount (the "Money Market Loan Limit").
(iv) The Administrative Agent shall (x) in the case of a Set Rate
Auction, as promptly as practicable after a Money Market Quote is submitted
(but in any event not later than 10:15 a.m. New York City time on the Quotation
Date) or (y) in the case of a LIBOR Auction, by 4:00 p.m. New York City time on
the day a Money Market Quote is submitted, notify the Borrower of the terms (A)
of any Money Market Quote that is in accordance with clause (iii) above and (B)
of any Money Market Quote that amends, modifies or is otherwise inconsistent
with a previous Money Market Quote submitted by the same Bank with respect to
the same Money Market Quote Request. Any such subsequent Money Market Quote
shall be disregarded unless such subsequent Money Market Quote is submitted
solely to correct a manifest error in such former Money Market Quote. The
Administrative Agent's notice to the Borrower shall specify (A) the aggregate
principal amount of the Money Market Borrowing for which offers have been
received, (B) the respective principal amounts and LIBO Margins or Money Market
Rates, as the case may be, so offered by each Bank (identifying the Bank that
made each Money Market Quote) and (C) such other terms as are required by clause
(iii) (C) above.
(v) Not later than 11:00 a.m. New York City time on (x) the third
Banking Day prior to the proposed date of borrowing, in the case of a LIBOR
Auction or (y) the Quotation Date, in the case of a Set Rate Auction (or, in
any such case, such other time and date as the Borrower and the Administrative
Agent, with the consent of the Required Banks, may agree), the Borrower shall
notify the Administrative Agent of its acceptance or nonacceptance of the offers
so notified to it pursuant to clause (iv) above pursuant to a Money Market
Confirmation (which shall be substantially in the form of Exhibit C and specify
the aggregate principal amount of offers from each Bank for each Interest Period
that are accepted, it being understood that the failure of the Borrower to give
such notice by such time shall constitute nonacceptance) and the Administrative
Agent shall promptly notify each affected Bank. The notice from the
Administrative Agent shall also specify the aggregate principal amount of offers
for each Interest Period that were accepted and the lowest and highest LIBO
Margins and Money Market Rates that were accepted for each Interest Period. The
Borrower may accept any Money Market Quote in whole or in part (provided that
any Money Market Quote accepted in part from any Bank shall be in an integral
multiple of $1,000,000, subject to the provisions of clause (vi) below);
provided that:
(A) the aggregate principal amount of each Money Market Loan may
not exceed the applicable amount set forth in the related Money Market Quote
Request;
(B) the aggregate principal amount of each Money Market Loan
shall be at least $5,000,000 (or a higher integral multiple of $1,000,000) but
shall not cause the limits specified in clause (i) above to be violated;
(C) acceptance of offers may, subject to clause (E) below, be
made only in ascending order of LIBO Margins or Money Market Rates, as the case
may be, in each case beginning with the lowest rate so offered;
(D) the Borrower may not accept any offer where the
Administrative Agent has advised the Borrower that the offer fails to comply
with clause (iii)(B) above or otherwise fails to comply with the terms of this
Agreement (including, without limitation, clause (i) above); and
(E) the aggregate principal amount of each Money Market
Borrowing from any Bank may not exceed any applicable Money Market Loan
Limit of such Bank.
(vi) If offers are made by two or more Banks with the same LIBO
Margins or Money Market Rates, as the case may be, for a greater aggregate
principal amount than the amount in respect of which offers are accepted for
the related Interest Period, the principal amount of Money Market Loans in
respect of which such offers are accepted shall be allocated by the Borrower
among such Banks as nearly evenly as possible (in integral multiples of
$1,000,000) in proportion to the aggregate principal amount of such offers;
provided that, if such calculation would otherwise result in allocations to
any such Banks that would not be integral multiples of $1,000,000 and such
allocations are equidistant from the nearest integral multiple of $1,000,000,
the Borrower shall have the discretion to arbitrarily round up to the nearest
$1,000,000 for certain Bank(s) and round down to the nearest $1,000,000 for
certain other Bank(s). Determinations by the Borrower as to the amounts of
Money Market Loans shall be conclusive absent manifest error.
(vii) Each Bank which is to make a Money Market Loan shall, before
1:00 p.m. (New York City time) on the date of the proposed Money Market Loan
specified in the Money Market Quote Request applicable thereto, make available
to the Administrative Agent at its Principal Office the amount of Money Market
Loans to be made by such Bank, in immediately available funds. The
Administrative Agent will make such funds available to the Borrower as soon as
practicable on such date at the Principal Office.
(viii) The amount of any Money Market Loan made by any Bank shall not
constitute a utilization of such Bank's Commitment.
Section 2.5. Prepayments and Conversions.
---------------------------
(a) The Borrower shall have the right to make prepayments of principal, or
to convert one type of Syndicated Loans into another type of Syndicated Loans,
at any time or from time to time; provided that: (i) the Borrower shall give the
Administrative Agent notice of each such prepayment or conversion as provided in
Section 2.8; (ii) Eurodollar Loans may be prepaid or converted only on the last
day of an Interest Period for such Loans, unless the Borrower compensates the
Banks pursuant to Section 3.5; and (iii) conversions from any type of Syndicated
Loans into Eurodollar Loans may not be made at any time that a Default or Event
of Default exists.
(b) Notwithstanding any other provision of this Agreement to the contrary,
the Borrower shall not have the right to prepay the principal amount of any
Money Market Loan unless the Borrower compensates the Bank making such Money
Market Loan pursuant to Section 3.5.
Section 2.6. Interest Periods; Renewals.
--------------------------
(a) In the case of each Eurodollar Loan and each Money Market Loan, the
Borrower shall select an Interest Period of any duration in accordance with the
definition of Interest Period in Section 1.1, subject to the limitation that
there may be no more than six (6) different Interest Periods for both Syndicated
Loans and Money Market Loans outstanding at the same time (for which purpose
Interest Periods described in different lettered clauses of the definition of
"Interest Period" shall be deemed to be different Interest Periods even if they
are coterminous).
(b) Upon notice to the Administrative Agent as provided in Section 2.8, the
Borrower may renew any Eurodollar Loan on the last day of the Interest Period
therefor as the same type of Loan with an Interest Period of the same or
different duration in accordance with the limitations provided above; provided
that Eurodollar Loans may not be renewed at any time that a Default or Event of
Default exists. If the Borrower shall fail to give notice to the Administrative
Agent of such a renewal, such Eurodollar Loan shall automatically become a
Variable Rate Loan on the last day of the current Interest Period.
Section 2.7. Changes of Commitments. The Borrowershall have the right to
----------------------
reduce or terminate the amount of unused Commitments at any time or from time to
time, provided that: (a) the Borrower shall give notice of each such reduc tion
or termination to the Administrative Agent as provided in Section 2.8; and (b)
each partial reduction shall be in an aggregate amount at least equal to
$5,000,000 and shall be an integral multiple of $1,000,000. The Commitments once
reduced or terminated may not be reinstated.
Section 2.8. Certain Notices. Notices by the Borrower to the Administrative
---------------
Agent of each borrowing pursuant to Section 2.4(a), each prepayment or
conversion pursuant to Section 2.5, each renewal pursuant to Section 2.6(b) and
each reduction or termination of the Commitments pursuant to Section 2.7 shall
be irrevocable and shall be effective only if received by the Administrative
Agent not later than 11:00 a.m. New York City time, and (a) in the case of
borrowings and prepayments of, conversions into and (in the case of Eurodollar
Loans) renewals of (i) Variable Rate Loans, given not later than the Banking Day
therefor and (ii) Eurodollar Loans, given not later than three Banking Days
prior thereto; and (b) in the case of reductions or termination of the
Commitments, given not later than three Banking Days prior thereto. Each such
notice shall specify the Loans to be borrowed, prepaid, converted or renewed and
the amount (subject to Section 2.9) and type of the Loans to be borrowed, or
converted, or prepaid or renewed (and, in the case of a conversion, the type of
Loans to result from such conversion and, in the case of a Eurodollar Loan, the
Interest Period therefor) and the date of the borrowing or prepayment, or
conversion or renewal (which shall be a Banking Day). Each such notice of
reduction or termination shall specify the amount of the Commitments to be
reduced or terminated. The Administrative Agent shall promptly notify the Banks
of the contents of each such notice.
Section 2.9. Minimum Amounts. Except for borrowings which exhaust the full
---------------
remaining amount of the Commitments, prepayments or conversions which result in
the prepayment or conversion of all Syndicated Loans of a particular type or
conversions made pursuant to Section 3.4, each borrowing, pre payment,
conversion and renewal of principal of (i) Variable Rate Loans shall be in an
amount at least equal to $5,000,000 in the aggregate for all Banks and (ii)
Eurodollar Loans shall be in an amount at least equal to $10,000,000 in the
aggregate for all Banks (borrowings, prepayments, conversions or renewals of or
into Loans of different types or, in the case of Eurodollar Loans, having
different Interest Periods at the same time hereunder to be deemed separate
borrowings, prepayments, conversions and renewals for the purposes of the
foregoing, one for each type of Interest Period) and, in the case of Eurodollar
Loans, in integral multiples of $1,000,000.
Section 2.10. Interest.
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(a) Interest shall accrue on the outstanding and unpaid principal amount of
each Syndicated Loan for the period from and including the date of such
Syndicated Loan to but excluding the date such Loan is due at the following
rates per annum: (i) for a Variable Rate Loan, at a variable rate per annum
equal to the Variable Rate and (ii) for a Eurodollar Loan, at a fixed rate equal
to the LIBO Rate plus the Margin. If the principal amount of any Syndicated Loan
and any other amount payable by the Borrower hereunder or under any Note shall
not be paid when due (at stated maturity, by acceleration or otherwise),
interest shall accrue on such amount to the fullest extent permitted by law from
and including such due date to but excluding the date such amount is paid in
full at the Default Rate. After the occurrence of an Event of Default other than
payment defaults described in the preceding sentence, then the Administrative
Agent may, and if directed by the Required Banks the Administrative Agent shall,
by written notice to the Borrower, increase the interest rate hereunder during
the continuance of such Event of Default to the Default Rate, effective on the
date of such notice.
(b) The interest rate on each Variable Rate Loan shall change when the
Variable Rate changes and interest on each such Loan shall be calculated on the
basis of a year of 365 (or, in the case of a leap year, 366) days for the actual
number of days elapsed. Interest on each Eurodollar Loan shall be calculated on
the basis of a year of 360 days for the actual number of days elapsed. Promptly
after the determination of any interest rate provided for herein or any change
therein, the Administrative Agent shall notify the Borrower and the Banks.
(c) Accrued interest shall be due and payable in arrears upon any payment
of principal or conversion and (i) for each Variable Rate Loan, on the last day
of each January, April, July and October, commencing the first such date after
such Loan; (ii)
for each Eurodollar Loan, on the last day of the Interest Period with respect
thereto and, in the case of an Interest Period greater than three months, at
three month intervals after the first day of such Interest Period; provided that
interest accruing at the Default Rate shall be due and payable from time to time
on demand of the Administrative Agent.
(d) The Borrower shall pay interest on the unpaid principal amount of each
Money Market Loan made to the Borrower from the date of such Money Market Loan
to the stated maturity date thereof, at the rate of interest determined pursuant
to Section 2.4(b) above (calculated on the basis of a 360 day year for actual
days elapsed), payable on the last day of the Interest Period with respect
thereto and, in the case of an Interest Period greater than three months, at
three month intervals after the first day of such Interest Period; provided that
interest accruing at the Default Rate shall be due and payable from time to time
on demand of the Administrative Agent. If all or a portion of the principal
amount of any Money Market Loan shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue principal amount
shall, without limiting any rights of any Bank under this Agreement, bear
interest from the date on which such payment was due until paid in full at the
Default Rate.
Section 2.11. Fees.
----
(a) The Borrower shall pay to the Administrative Agent for the account of
each Bank a facility fee on the daily average Commitment (used and unused) of
such Bank for the period from and including the date hereof to the earlier of
the date the Commitments are terminated in full or the Termination Date at a
rate per annum equal to the rate determined in accordance with Section 2.14,
calculated on the basis of a year of 365 (or, in a leap year, 366) days for the
actual number of days elapsed. The accrued facility fee shall be due and payable
in arrears upon any termination of the Commitments, including, without
limitation, the Termination Date, and on the last day of each January, April,
July and October, commencing on the first such date after the Closing Date.
(b) The Borrower shall pay to the Administrative Agent as compensation for
its services hereunder an agency fee in the amount heretofore mutually agreed.
The agency fee shall be due and payable on the Closing Date and on each
anniversary thereof until all the Commitments shall have terminated and the
Loans and other obligations of the Borrower to the Administrative Agent and the
Banks pursuant to this Agreement and the other Facility Documents shall have
been paid in full.
(c) The Borrower shall pay to the Administrative Agent a fee of $750 each
time the Borrower delivers a Money Market Quote Request to the Administrative
Agent.
Section 2.12. Payments Generally. All payments under this Agreement or the
------------------
Notes shall be made in Dollars in immediately available funds not later than
1:00 p.m. New York City time on the relevant dates specified above (each such
payment made after
such time on such due date to be deemed to have been made on the next succeeding
Banking Day) to the Administrative Agent's account number 900 9000002 maintained
at the Principal Office for the account of the applicable Lending Office of each
Bank. The Administrative Agent, or any Bank for whose account any such payment
is to be made, may (but shall not be obligated to) debit the amount of any such
payment which is not made by such time to any ordinary deposit account of the
Borrower with the Administrative Agent or such Bank, as the case may be, and any
Bank so doing shall promptly notify the Administrative Agent and the Borrower.
The Borrower shall, at the time of making each payment under this Agreement or
the Notes, specify to the Administrative Agent the principal or other amount
payable by the Borrower under this Agreement or the Notes to which such payment
is to be applied (and in the event that it fails to so specify, or if a Default
or Event of Default has occurred and is continuing, the Administrative Agent may
apply such payment as it may elect in its sole discretion (subject to Section
10.16)). If the due date of any payment under this Agreement or the Notes would
otherwise fall on a day which is not a Banking Day, such date shall be extended
to the next succeeding Banking Day and interest shall be payable for any
principal so extended for the period of such extension. Each payment received by
the Administrative Agent hereunder or under any Note for the account of a Bank
shall be paid promptly to such Bank, in immediately available funds, for the
account of such Bank's Lending Office.
Section 2.13. Margin for Eurodollar Loans.
---------------------------
(a) Until such time as: (i) the Borrower shall have received a rating of
"A2" or higher by S&P or "P2" or higher by Moody's with respect to the
Borrower's senior, unsecured, non-credit enhanced short term indebtedness for
borrowed money (a "Debt Rating") and (ii) the Borrower has not received a Debt
Rating lower than "A2" or "P2" from S&P or Moody's, respectively, the Margin
that will apply to each Eurodollar Loan is set forth below and is based upon the
Borrower's Leverage Ratio as at the end of the Borrower's most recent fiscal
quarter:
Margin
Eurodollar Loans
Leverage Ratio (Basis Points)
- -------------------------------------------------------------------
Greater than 2.50 35.00
- -------------------------------------------------------------------
Greater than or equal to 2.01, but not
greater than 2.50 30.00
- -------------------------------------------------------------------
Greater than or equal to 1.00, but less
than 2.01 25.00
- -------------------------------------------------------------------
Less than 1.00 17.00
- -------------------------------------------------------------------
Margin adjustments resulting from such calculations shall become effective
five (5) Banking Days after the date such calculations are accepted by the
Administrative Agent. Promptly after the determination of any Margin adjustment
provided for in this subsection (a), the Administrative Agent shall notify the
Borrower and the Banks.
(b) At such time, and from time to time, as: (i) the Borrower shall have
received a Debt Rating of "A2" or higher from S&P or "P2" or higher from Moody's
and (ii) the Borrower has not received a Debt Rating lower than "A2" or "P2"
from S&P or Moody's, respectively, the Margin that will apply to each Eurodollar
Loan is set forth below:
Margin
Eurodollar Loans
Debt Rating (Basis Points)
----------------------------------------------
"A1" or "P1" 17.00
----------------------------------------------
"A2" or "P2" 25.00
----------------------------------------------
Margin adjustments resulting from such a rating shall become effective five
(5) Banking Days after the date such rating is received by the Administrative
Agent. Promptly after any Margin adjustment provided for in this subsection (b),
the Administrative Agent shall notify the Banks.
For the purposes of clause (b) of this Section 2.13, if the Borrower's
short-term indebtedness is split rated (e.g., it has received a Debt Rating of
"A1" from S&P and a Debt Rating of "P2" from Moody's), the lower of the two
ratings will apply.
(c) If S&P or Moody's, having given a Debt Rating of "A2" or "P2" or
higher, respectively, changes its Debt Rating to lower than "A2" or "P2",
respectively, the Margin shall be calculated pursuant to subsection (a) above
until such time as an event occurs that would require the Margin to adjust in
the manner set forth in subsection (b) above.
Section 2.14. Facility Fee Rate.
-----------------
(a) Until such time as: (i) the Borrower shall have received a Debt Rating
of "A2" or higher by S&P or "P2" or higher by Moody's and (ii) the Borrower has
not received a Debt Rating lower than "A2" or "P2" from S&P or Moody's,
respectively, the per annum facility fee rate that the Borrower shall use to
calculate the facility fee that is payable pursuant to Section 2.11(a) is set
forth below and is based upon the Borrower's Leverage Ratio as at the end of the
Borrower's most recent fiscal quarter:
Facility Fee Rate
Leverage Ratio (Basis Points)
- ------------------------------------------------------------------
Greater than 2.50 15.00
- ------------------------------------------------------------------
Greater than or equal to 2.01, but not 12.50
greater than 2.50
- ------------------------------------------------------------------
Greater than or equal to 1.00, but less 10.00
than 2.01
- ------------------------------------------------------------------
Less than 1.00 8.00
- ------------------------------------------------------------------
Facility fee rate adjustments resulting from such calculations shall become
effective five (5) Banking Days after such calculations are accepted by the
Administrative Agent. Promptly after the determination of any facility fee rate
adjustment provided for in this subsection (a), the Administrative Agent shall
notify the Borrower and the Banks.
(b) At such time, and from time to time, as: (i) the Borrower shall have
received a Debt Rating of "A2" or higher from S&P or "P2" or higher from Moody's
and (ii) the Borrower has not received a Debt Rating lower than "A2" or "P2"
from S&P or Moody's, respectively, the facility fee rate that the Borrower shall
use to calculate the facility fee that is payable pursuant to Section 2.11(a) is
set forth below:
Facility Fee Rate
Debt Rating (Basis Points)
--------------------------------------------------------
"A1" or "P1" 8.00
--------------------------------------------------------
"A2" or "P2" 10.00
--------------------------------------------------------
Facility fee rate adjustments resulting from such a Debt Rating shall
become effective five (5) Banking Days after such rating is received by the
Administrative Agent. Promptly after any facility fee rate adjustment provided
for in this subsection (b), the Administrative Agent shall notify the Banks.
For the purposes of clause (b) of this Section 2.14, if the Borrower's
short-term indebtedness is split rated (e.g., it has received a Debt Rating of
"A1" from S&P and a Debt Rating of "P2" from Moody's), the lower of the two
ratings will apply.
(c) If S&P or Moody's, having given a Debt Rating of "A2" or "P2" or
higher, respectively, changes its Debt Rating to lower than "A2" or "P2",
respectively, the facility fee rate adjustment pursuant to subsection (b) shall
be ineffective as of such date, and the facility fee rate shall be calculated
pursuant to subsection (a) above until such time as an event occurs that would
require the facility fee rate to adjust in the manner set forth in subsection
(b) above.
(d) The facility fee payable under Section 2.11(a) shall be calculated by
applying the average daily facility fee rate to the average daily Commitments.
ARTICLE 3. YIELD PROTECTION; ILLEGALITY; ETC.
Section 3.1. Additional Costs.
----------------
(a) The Borrower shall pay directly to each Bank from time to time on
demand such amounts as such Bank may determine to be necessary to compensate it
for any costs which such Bank determines are attributable to its making or
maintaining any Loans under this Agreement or either of its Notes or its
obligation to make any Loans hereunder, or any reduction in any amount
receivable by such Bank hereunder in respect of any such Loans or such
obligation (such increases in costs and reductions in amounts receivable being
herein called "Additional Costs"), resulting from any Regulatory Change which:
(i) changes the basis of taxation of any amounts payable to such Bank under this
Agreement or either of its Notes in respect of any of such Loans (other than
taxes imposed on the overall net income of such Bank or of its Lending Office
for any of such Loans by the jurisdiction in which such Bank has its principal
office or such Lending Office); or (ii) imposes or modifies any reserve, special
deposit, deposit insurance or assessment, minimum capital, capital ratio or
similar requirements relating to any extensions of credit or other assets of, or
any deposits with or other liabilities of, such Bank (including, without
limitation, any of such Loans or any deposits referred to in the definition of
"LIBO Base Rate" in Section 1.1); or (iii) imposes any other condition affecting
this Agreement or either of its Notes (or any of such extensions of credit or
liabilities) or its Commitment. Each Bank will notify the Borrower of any event
occurring after the date of this Agreement which will entitle such Bank to
compensation pursu ant to this Section 3.1(a) as promptly as practicable after
it obtains knowledge thereof and determines to request such compensation. If any
Bank requests compensation from the Bor rower under this Section 3.1(a), the
Borrower may, by notice to such Bank (with a copy to the Administrative Agent),
suspend the obligation of such Bank thereafter to make Loans until the
Regulatory Change giving rise to such request ceases to be in effect (in which
case the provisions of Section 3.4 hereof shall be applicable), provided, that
such suspension shall not affect the right of such Bank to receive the
compensation so requested (or any facility fees).
(b) Without limiting the effect of the forego ing provisions of this
Section 3.1, in the event that, by reason of any Regulatory Change, any Bank
either (i) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits or other liabilities of
such Bank which includes deposits by ref erence to which the interest rate on
LIBO Rate Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of such Bank which includes LIBO Rate Loans
or (ii) becomes subject to restrictions on the amount of such a category of
liabilities or assets which it may hold, then, if such Bank so elects by notice
to the Borrower (with a copy to the Administrative Agent), the obligation of
such Bank to make or renew, and to convert Syndicated Loans of any other type
into, LIBO Rate Loans hereunder shall be suspended until the date such
Regulatory Change ceases to be in effect (in which case the provisions of
Section 3.4 hereof shall be applicable).
(c) Without limiting the effect of the forego ing provisions of this
Section 3.1 (but without duplication), the Borrower shall pay directly to each
Bank from time to time on request such amounts as such Bank may determine to be
necessary to compensate such Bank for any costs which it determines are
attributable to the maintenance by it or any of its affiliates pursuant to any
law or regulation of any jurisdiction or any interpretation, directive or
request (whether or not having the force of law and whether in effect on the
date of this Agreement or thereafter) of any Governmental Authority or monetary
authority of capital in respect of its Loans hereunder or its obligation to make
Loans hereunder (such compensation to include, without limitation, an amount
equal to any reduction in return on assets or equity of such Bank to a level
below that which it could have achieved but for such law, regulation,
interpretation, directive or request). Each Bank will notify the Borrower if it
is entitled to compensation pursuant to this Section 3.1(c) as promptly as
practicable after it determines to request such compensation.
(d) Determinations and allocations by a Bank for purposes of this Section
3.1 of the effect of any Regula tory Change pursuant to subsections (a) or (b),
or of the effect of capital maintained pursuant to subsection (c), on its costs
of making or maintaining Loans or its obligation to make Loans, or on amounts
receivable by, or the rate of return to, it in respect of Loans or such
obligation, and of the additional amounts required to compensate such Bank under
this Section 3.1, shall be conclusive, provided that such determinations and
allocations are made on a reasonable basis.
Section 3.2. Limitation on Types of Loans. Anything herein to the contrary
----------------------------
notwithstanding, if:
(a) the Administrative Agent determines in its good faith judgment after
due diligence (which determination shall be conclusive) that quotations of
interest rates for the relevant deposits referred to in the definition of "LIBO
Base Rate" in Section 1.1 are not being provided in the relevant amounts or for
the relevant maturities for purposes of determining the rate of interest for any
type of LIBO Rate Loans as provided in this Agreement; or
(b) the Required Banks determine in their good faith judgment after due
diligence (or any Bank that has outstanding a Money Market Quote with respect to
a LIBOR Market Loan determines), which determination shall be conclusive, and
notify (or notifies, as the case may be) the Administrative Agent that the
relevant rates of interest referred to in the definition of "LIBO Base Rate" in
Section 1.1 do not adequately cover the cost to the Banks (or such offering
Bank) of making or maintaining its LIBO Rate Loans;
then the Administrative Agent shall give the Borrower and each Bank prompt
notice thereof, and so long as such condition remains in effect, the Banks (or
such offering Bank) shall be
under no obligation to make or renew LIBO Rate Loans or to convert Syndicated
Loans of any other type into Syndicated Loans of such type.
Section 3.3. Illegality. Notwithstanding any other provision in this
----------
Agreement, in the event that it becomes unlawful for any Bank or its Lending
Office to (a) honor its obligation to make or renew LIBO Rate Loans hereunder or
convert Syndicated Loans of any type into Syndicated Loans of such type, or (b)
maintain LIBO Rate Loans hereunder, then such Bank shall promptly notify the
Borrower thereof (with a copy to the Administrative Agent) and such Bank's
obligation to make or renew Eurodollar Loans and to convert other types of
Syndicated Loans into Syndicated Loans of such type hereunder shall be suspended
until such time as such Bank may again make, renew, or convert and maintain such
Eurodollar Loans (in which case the provisions of Section 3.4 hereof shall be
applicable) and such Bank shall no longer be obligated to make any LIBOR Market
Loan that it has offered to make.
Section 3.4. Certain Conversions pursuant to Sections 3.1 and 3.3. If the
----------------------------------------------------
obligation of any Bank to make or renew or convert into LIBO Rate Loans shall be
suspended pursuant to Section 3.1 or 3.3 (Loans of such type being herein called
"Affected Loans" and such type being herein called the "Affected Type"), all
Loans (other than Money Market Loans) which would otherwise be made or renewed
by such Bank as Loans of the Affected Type shall be made instead as Variable
Rate Loans and all Loans of such Bank which would otherwise be converted into
Loans of the Affected Type shall be converted instead into (or shall remain as)
Variable Rate Loans (and, if an event referred to in Section 3.1(b) or 3.3
hereof has occurred and such Bank so requests by notice to the Borrower with a
copy to the Administrative Agent, such Bank's Affected Loans then outstanding
shall be automatically converted into Variable Rate Loans on the last day(s) of
the then current Interest Period(s) for the Affected Loans or on such earlier
date as such Bank may specify to the Borrower with a copy to the Administrative
Agent) and, to the extent that such Bank's Affected Loans have been made as (or
converted into) Variable Rate Loans, all payments and prepayments of principal
which would otherwise be applied to such Bank's Affected Loans shall be applied
instead to its Variable Rate Loans.
Section 3.5 Certain Compensation. The Borrower shall pay to the
--------------------
Administrative Agent for the account of each Bank, upon the request of such
Bank through the Administrative Agent, such amount or amounts as shall be
sufficient (in the reasonable opinion of such Bank) to compensate it for any
loss, cost or expense which such Bank reasonably determines is attributable to:
(a) any payment, prepayment, conversion or renewal of a LIBO Rate Loan
or a Set Rate Loan made by such Bank on a date other than the last day of an
Interest Period for such Loan (whether by reason of acceleration or otherwise);
or
(b) any failure by the Borrower to borrow, convert into or renew a
LIBO Rate Loan or a Set Rate Loan to be made, converted into or renewed by
such Bank
on the date specified therefor in the relevant notice under Section 2.4, 2.5 or
2.6, as the case may be.
Without limiting the foregoing, such compensation shall include an amount
equal to the excess, if any, of: (i) the amount of interest which otherwise
would have accrued on the principal amount so paid, prepaid, converted or
renewed or not borrowed, converted or renewed for the period from and including
the date of such payment, prepayment or conversion or failure to borrow, convert
or renew to but excluding the last day of the then current Interest Period for
such Loan (or, in the case of a failure to borrow, convert or renew, to but
excluding the last day of the Interest Period for such Loan which would have
commenced on the date specified therefor in the relevant notice) at the
applicable rate of interest for such Loan provided for herein; over (ii) with
respect to a LIBO Rate Loan, the amount of interest (as reasonably determined by
such Bank) such Bank would have bid in the London interbank market for Dollar
deposits for amounts comparable to such principal amount and maturities
comparable to such period, and with respect to a Set Rate Loan, the rate
determined by such Bank to be its marginal cost of funds for commonly available
liabilities issued by it on the date of such Loan for a term comparable to such
Interest Period. A determination of any Bank as to the amounts payable pursuant
to this Section 3.5 shall be conclusive absent manifest error.
ARTICLE 4. CONDITIONS PRECEDENT.
Section 4.1. Initial Conditions Precedent. The obligations of the Banks to
----------------------------
make the Loans constituting the initial borrowing are subject to the condition
precedent that the Administrative Agent shall have received on or before the
date of such Loans each of the following items, in form and substance reasonably
satisfactory to the Administrative Agent and its counsel, or, with respect to
non-documentary conditions precedent, that the Administrative Agent shall have
reasonably determined that such conditions shall have been satisfied on or
before the date of such Loans:
(a) the Notes duly executed by the Borrower;
(b) the Authorization Letter duly executed by the Borrower;
(c) a favorable opinion of Robert T. Tucker, Esq., counsel for the
Borrower, dated the date of such initial borrowing, in substantially the form of
Exhibit H and as to such other matters as the Administrative Agent or any Bank
may reasonably request;
(d) a favorable opinion of Cummings & Lockwood, counsel for the
Administrative Agent, dated the date of such initial borrowing;
(e) a certificate of the Secretary or Assistant Secretary of the Borrower,
dated the date of such initial borrowing, attesting to all corporate action
taken by the Borrower, including resolutions of its Board of Directors
authorizing the execution, delivery and performance of the Facility Documents to
which it is a party and each other document to be delivered pursuant to this
Agreement and certifying true copies of the articles of incorporation, bylaws
and other organizational documents of the Borrower;
(f) a certificate of the Secretary or Assistant Secretary of the Borrower,
dated the date of such initial borrowing, certifying the names and true
signatures of the officers of the Borrower authorized to sign the Facility
Documents to which it is a party and the other documents to be delivered by the
Borrower under this Agreement;
(g) a certificate of good standing for the Borrower from the Secretary of
State of the Borrower's incorporation and each jurisdiction in which the
Borrower is qualified to do business;
(h) a certificate of a duly authorized officer of the Borrower, dated the
date of such initial borrowing, stating that the representations and warranties
in the Facility Documents to which it is a party are true and correct on such
date as though made on and as of such date and that no event has occurred and is
continuing which constitutes a Default or Event of Default;
(i) the Borrower's Form 10-K for January 31, 1995, and each of the
Borrower's Forms 10-K and 10-Q filed since said date;
(j) contemporaneous searches of Uniform Commercial Code, real estate, tax,
patent and trademark and other appropriate registers, dockets, offices and
records, which shall have revealed no filings or recordings evidencing or
relating to any Liens with respect to any property of the Borrower (other than
Liens permitted by Section 7.3);
(k) a payoff letter and releases from General Electric Capital Corporation
in form and substance reasonably satisfactory to the Administrative Agent;
(l) payment by the Borrower to the Administrative Agent of all fees owing
to the Administrative Agent and all other expenses and fees incurred by the
Administrative Agent (including, without limitation, the reasonable fees,
charges and disbursements of counsel to the Administrative Agent due and owing
through the date of the initial borrowing); and
(m) such other documents as the Administrative Agent, any Bank or any of
their respective counsel may reasonably request.
Section 4.2. Additional Conditions Precedent. The obligations of the Banks
-------------------------------
to make any Loans pursuant to a borrowing which increases the amount
outstanding hereunder (including the initial borrowing) and to make borrowings
to repay Money Market Loans shall be subject to the further conditions precedent
that on the date of such Loans:
(a) the following statements shall be true in all material respects:
(i) the representations and warranties contained in Article 5 herein
and in each other Facility Document are true and correct on and as of the date
of such Loan as though made on and as of such date; and
(ii) no Default or Event of Default has occurred and is continuing,
or would result from such Loan; and
(iii) there has been no change in the business, management,
operations, properties or financial condition of the Borrower or any of its
Subsidiaries since the Closing Date which has had, or could reasonably be
expected to have, a Material Adverse Effect; and
(b) either
(i) the Borrower shall have delivered to the Administrative Agent a
Notice of Borrowing in substantially the form of Exhibit I; or
(ii) the Borrower shall have delivered to the Administrative Agent a
Money Market Quote Request substantially in the form of Exhibit E-1 or
Exhibit E-2.
Section 4.3. Deemed Representations. Each Notice of Borrowing hereunder and
----------------------
acceptance by the Borrower of the proceeds of such borrowing shall constitute a
representation and warranty that the statements contained in Section 4.2(a) are
true and correct in all material respects both on the date of such notice and,
unless the Borrower otherwise notifies the Administrative Agent prior to such
borrowing, as of the date of such borrowing.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES.
The Borrower hereby represents and warrants that:
Section 5.1. Incorporation, Good Standing and Due Qualification. Each of
--------------------------------------------------
the Borrower and its Material Subsidiaries is duly incorporated, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, has the corporate
power and authority to own its assets and to transact the business in which it
is now engaged or proposed to be engaged, and is duly qualified as a foreign
corporation and in good standing under the laws of each other jurisdiction in
which such qualification is required.
Section 5.2. Corporate Power and Authority; No Conflicts. The execution,
-------------------------------------------
delivery and performance by the Borrower of the Facility Documents to which it
is a party have been duly authorized by all necessary corporate action and do
not and will not: (a) require any consent or approval of its stockholders; (b)
contravene its charter or by-laws; (c) violate any provision of, or require any
filing, registration, consent or approval under, any law, rule, regulation
(including, without limitation, Regulation U), order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to the Borrower or any of its Subsidiaries; (d) result in a breach
of or constitute a default or require any consent under any indenture or loan or
credit agreement or any other agreement, lease or instrument to which the
Borrower is a party or by which it or its properties may be bound or affected;
(e) result in, or require, the creation or imposition of any Lien, upon or with
respect to any of the properties now owned or hereafter acquired by the
Borrower; or (f) cause the Borrower (or any Subsidiary) to be in default under
any such law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or any such indenture, agreement, lease or instrument.
Section 5.3. Legally Enforceable Agreements. Each Facility Document to
------------------------------
which the Borrower is a party is, or when delivered under this Agreement will
be, a legal, valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with its terms, except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency and other
similar laws affecting creditors' rights generally.
Section 5.4. Litigation. There are no actions, suits or proceedings pending
----------
or, to the knowledge of the Borrower, threatened, against or affecting the
Borrower or any of its Subsidiaries before any Governmental Authority, which, in
any one case or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
Section 5.5 Financial Statements. The consolidated balance sheet of the
--------------------
Borrower and its Consolidated Subsidiaries as at January 31, 1995 , and the
related consolidated income statement and statements of cash flows and changes
in stockholders' equity of the Borrower and its Consolidated Subsidiaries for
the fiscal year then ended, and the accompanying footnotes, together with the
opinion thereon, of Ernst & Young, LLP, independent certified public
accountants, and the interim consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as at October 31, 1995, and the related consolidated
income statement and statements of cash flows and changes in stockholders'
equity for the nine (9) month period then ended, copies of which have been
furnished to the Administrative Agent, are complete and correct and fairly
present the financial condition of the Borrower and its Consolidated
Subsidiaries as at such dates and the results
of the operations of the Borrower and its Consolidated Subsidiaries for the
periods covered by such statements, all in accordance with GAAP consistently
applied (subject to recurring year end adjustments in the case of the interim
financial statements). Except as disclosed on Schedule 5.5, there are no
liabilities of the Borrower or any of its Consolidated Subsidiaries, fixed or
contingent, which are material but are not reflected in such financial
statements or in the notes thereto, other than liabilities arising in the
ordinary course of business since January 31, 1995. No information, exhibit or
report furnished by the Borrower to the Administrative Agent in connection with
the negotiation of this Agreement contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statements
contained therein not materially misleading. Since January 31, 1995, there has
been no change in the financial condition, business or operations of the
Borrower or any of its Subsidiaries which has had, or could reasonably be
expected to have, a Material Adverse Effect.
Section 5.6. Ownership and Liens. Except as set forth on Schedule 7.2, each
-------------------
of the Borrower and its Material Subsidiaries has good, marketable title in fee
simple to, or valid leasehold interests in, all of its material properties and
assets, real and personal, including the properties and assets, and leasehold
interests reflected in the financial statements referred to in Section 5.5 or
submitted pursuant to Section 6.8 hereof, as the case may be (other than any
properties or assets disposed of in the ordinary course of business), and none
of the material properties and assets owned by the Borrower or any of its
Subsidiaries and none of its material leasehold interests is subject to any
Lien, except as disclosed in such Schedule 7.2, such financial statements or as
may be permitted hereunder.
Section 5.7. Taxes. To the best of the Borrower's knowledge, all material
-----
tax and other information returns required to be filed by or on behalf of the
Borrower and its Subsidiaries have been properly prepared, executed and filed.
All material taxes, assessments, fees and other governmental charges upon the
Borrower or any of its Subsidiaries or upon any of their respective properties,
incomes, sales or franchises which are due and payable have been paid other than
those not yet delinquent and payable without premium or penalty, and except for
those being diligently contested in good faith and by appropriate proceedings,
and in each case adequate reserves and provisions for taxes on the books of the
Borrower and each of its Subsidiaries are adequate for all open years and for
its current fiscal period. None of the Borrower or its Subsidiaries knows of any
proposed additional assessment or basis for any material assessment for
additional taxes (whether or not reserved against). The federal, state and local
and foreign income tax liabilities of the Borrower have been finally determined
by the Internal Revenue Service and other relevant taxing authorities, or the
time for audit has expired, for all fiscal periods ending on or prior to January
31, 1989 and all such liabilities (including all deficiencies assessed following
audit) have been satisfied. None of the Borrower, its Subsidiaries or any of
their respective consolidated return groups has at any time filed a consolidated
tax return with any Person other than the Borrower and its Subsidiaries, except
as set forth in Schedule 5.7. Schedule 5.7 describes all tax sharing
arrangements or agreements to which
the Borrower or any of its Subsidiaries is bound.
Section 5.8. ERISA.
-----
(a) Schedule 5.8 sets forth a correct and complete list of each Plan or
Multiemployer Plan with respect to the employees of the Borrower and its ERISA
Affiliates.
(b) Each Plan, and, to the best knowledge of the Borrower, each
Multiemployer Plan, is in compliance in all material respects with, and has been
administered in all material respects in compliance with, the applicable
provisions of ERISA, the Code and any other applicable Federal or state law, and
no event or condition is occurring or exists concerning which the Borrower would
be under an obligation to furnish a report to the Banks in accordance with
Section 6.8(h) hereof. As of the most recent valuation date for each Plan, each
Plan was "fully funded", or shall be "fully funded" within twelve (12) months of
the later of: (i) the date such Plan became a Plan with respect to the employees
of the Borrower and its ERISA Affiliates or (ii) the date such Plan was deemed
other than "fully funded". For purposes of this Section 5.8, "fully funded"
shall mean that the fair market value of the assets of the Plan is not less than
the present value of the accrued benefits of all participants in the Plan,
computed on a Plan termination basis. To the best knowledge of the Borrower, no
Plan has been other than "fully funded" for greater than the twelve (12) month
period prescribed above as of the date these representations are made with
respect to any Loan under this Agreement.
Section 5.9. Material Subsidiaries and Ownership of Stock. Schedule 5.9 is
--------------------------------------------
a complete and accurate list of the Material Subsidiaries of the Borrower,
showing the jurisdiction of incorporation or organization of each such Material
Subsidiary and showing the percentage of the Borrower's or any of its
Subsidiaries' ownership of the outstanding stock or other interest of each such
Material Subsidiary. All of the outstanding capital stock or other interest of
each such Material Subsidiary has been validly issued, is fully paid and
nonassessable and is owned by the Borrower or such Subsidiary free and clear of
all Liens, except as set forth on Schedule 7.2.
Section 5.10. Credit Arrangements. Schedule 5.10 is a complete and correct
-------------------
list of all credit agreements, inden tures, purchase agreements, guaranties,
Capital Leases and other investments, agreements and arrangements presently in
effect providing for or relating to extensions of Debt equal to or greater than
$1,000,000 in respect of which the Borrower or any of its Subsidiaries is in any
manner directly or contingently obligated; and the maximum principal or face
amounts of the Debt in question, outstanding and which can be outstanding, are
correctly stated, and all Liens of any nature given or agreed to be given as
security therefor are correctly described or indicated in such Schedule.
Section 5.11. Operation of Business. To the best of the Borrower's
---------------------
knowledge, each of the Borrower and its Subsidiaries possesses all material
licenses,
permits, franchises, patents, copyrights, trademarks and trade names, or rights
thereto, to conduct its business substantially as now conducted and as presently
proposed to be conducted, and neither the Borrower nor any of its Subsidiaries
is in violation of any valid rights of others with respect to any of the
foregoing, except where such violation is not reasonably expected to have a
Material Adverse Effect.
Section 5.12. Hazardous Materials. The Borrower and each of its
-------------------
Subsidiaries have obtained all permits, licenses and other authorizations which
are required under all Environmental Laws, except to the extent failure to have
any such permit, license or authorization would not have a Mate rial Adverse
Effect. The Borrower and each of its Subsid iaries are in compliance with the
terms and conditions of all such permits, licenses and authorizations, and are
also in compliance with all other limitations, restrictions, conditions,
standards, prohibitions, requirements, obligations, schedules and timetables
contained in any applicable Environmental Law or in any regulation, code, plan,
order, decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder, except to the extent failure to comply would
not have a Material Adverse Effect. To the best of the Borrower's knowledge,
except as heretofore disclosed to the Administrative Agent or as set forth on
Schedule 5.12, there have been no environmental investigations, studies, audits,
tests, reviews or other analyses conducted by or that are in the possession of
the Borrower or any of its Subsidiaries with respect to any property or facility
now or previously owned or leased by the Borrower or any of its Environmental
Affiliates which reveal facts or circumstances that could reasonably be expected
to have a Material Adverse Effect.
Section 5.13. No Default on Outstanding Judgments or Orders. Each of the
---------------------------------------------
Borrower and its Subsidiaries has sat isfied all judgments and neither the
Borrower nor any of its Subsidiaries is in default with respect to any judgment,
writ, injunction or decree of any Governmental Authority, except where the
failure so to do is not reasonably expected to have a Material Adverse Effect.
Section 5.14. No Defaults on Other Agreements. Neither the Borrower nor any
-------------------------------
of its Subsidiaries is in default in any respect in the performance, observance
or fulfillment of any of the obligations, covenants or conditions contained in
any indenture, loan or credit agreement or any lease or other agreement or
instrument with respect to its business to which it is a party which default
could reasonably be expected to have a Material Adverse Effect.
Section 5.15. Labor Disputes and Acts of God. Neither the business nor the
------------------------------
properties of the Borrower or of any of its Subsidiaries are currently affected
by any fire, explosion, accident, strike, lockout or other labor dispute,
drought, storm, hail, earthquake, embargo, act of God or of the public enemy or
other casualty (whether or not covered by insurance) that could reasonably be
expected to have a Material Adverse Effect.
Section 5.16. Governmental Regulation. Neither the Borrower nor any of its
-----------------------
Subsidiaries is subject to regulation under the Public Utility Holding Company
Act of 1935, the Investment Company Act of 1940, the Interstate Commerce Act,
the Federal Power Act or any statute or regulation limiting its ability to incur
indebtedness for money borrowed as con templated hereby.
Section 5.17. Insurance. The Borrower maintains through itself or through
---------
financially sound and reputable insurers not related to or affiliated with the
Borrower insurance with respect to its properties and business and against at
least such liabilities, casualties and contingencies and in at least such types
and amounts as is customary in the case of corporations engaged in the same or a
similar business or having similar properties similarly situated. It is
understood that the Borrower shall be self-insured only for noncatastrophic
insurance coverage. Schedule 5.17 sets forth a complete and correct list and
brief description of all insurance currently maintained by or on respect of the
Borrower, setting forth the identity of the insurance carrier, the type of
coverage, the amount of coverage and the deductible. There are no claims,
actions, suits, proceedings against, arising under or based upon any of such
insurance policies except as set forth in Schedule 5.17 which could reasonably
be expected to have a Material Adverse Effect. Schedule 5.17 identifies each
insurance policy providing for a retrospective premium adjustment or other
change in compensation payable to the insurer on the basis of claim or loss
experience, and describes any liability the Borrower has in respect of such
matters.
Section 5.18. Intellectual Property. To the best of the Borrower's
---------------------
knowledge, the Borrower and each of its Subsidiaries owns, or is licensed or
otherwise has the right to use, all the material patents, trademarks, service
marks, names (trade, service, fictitious or otherwise), copyrights, technology
(including but not limited to computer programs and software), processes, data
bases and other rights, free from burdensome restrictions, necessary to own and
operate its properties and carry on its business as presently conducted and
presently planned to be conducted without conflict with the rights of others.
ARTICLE 6. AFFIRMATIVE COVENANTS.
So long as any of the Notes shall remain unpaid or any Bank shall
have any Commitment under this Agreement, the Borrower shall:
Section 6.1. Maintenance of Existence. Preserve and maintain, and cause
------------------------
each of its Subsidiaries to preserve and maintain, its corporate existence and
good standing in the jurisdiction of its incorporation, and qualify and remain
qualified, and cause each of its Subsidiaries to qualify and remain qualified,
as a foreign corporation in each jurisdiction in which such qualification is
required, except where the failure to do so could not be reasonably expected to
have a Material Adverse Effect.
Section 6.2. Conduct of Business. Continue, and cause each of its
-------------------
Subsidiaries to continue, to engage in, directly or indirectly, the provision of
consumer goods or services, except for other businesses that may be operated as
a result of an Acceptable Acquisition.
Section 6.3. Maintenance of Properties. Maintain, keep and preserve, and
-------------------------
cause each of its Subsidiaries to maintain, keep and preserve, all of its
material properties (tangible and intangible), permits and licenses necessary or
useful in the proper conduct of its business in good working order and
condition, ordinary wear and tear excepted.
Section 6.4. Maintenance of Records. Keep, and cause each of its
----------------------
Subsidiaries to keep, adequate records and books of account, in which complete
entries will be made in accordance with GAAP, reflecting all material financial
transactions of the Borrower and its Subsidiaries.
Section 6.5 Maintenance of Insurance. Maintain, either through itself or
------------------------
with financially sound and reputable insurers, insurance with respect to its
properties and business and against such liabilities, casualties and
contingencies and of such types and in such amounts as is customary in the case
of corporations engaged in the same or similar businesses or having similar
properties similarly situated, which insurance shall in any event not provide
for a materially lower level of coverage than the insurance referred to in
Section 5.17 in effect on the Closing Date. Further, the Borrower shall furnish
to the Administrative Agent from time to time upon request the policies under
which such insurance is issued, certificates of insurance and such other
information relating to such insurance as the Administrative Agent may
reasonably request.
Section 6.6. Compliance with Laws. Comply, and cause each of its
--------------------
Subsidiaries to comply, with all applicable material laws, rules, regulations
and orders.
Section 6.7. Right of Inspection. At any reasonable time and from time to
-------------------
time and, so long as no Default or Event of Default shall have occurred or be
continuing, upon not less than five (5) Banking Days' prior notice, and subject
to the provisions of Section 11.15, permit the Administrative Agent or any Bank
or any agent or representative thereof, to examine and make copies and abstracts
from the records and books of account of, and visit the properties of, the
Borrower and any of its Subsidiaries, and to discuss the affairs, finances and
accounts of the Borrower and any such Subsidiary with any of their respective
officers and directors and the Borrower's independent accountants, and to
conduct an audit of the Borrower; provided, that so long as no Default or Event
--------
of Default shall have occurred or be continuing, each Bank may not exercise the
benefits conferred upon it under this Section 6.7 more than once during any
calendar year.
Section 6.8. Reporting Requirements. Furnish to the Administrative Agent,
----------------------
who shall provide copies thereof to the Banks:
(a) as soon as available and in any event within 90 days after the end of
each fiscal year of the Bor rower, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such fiscal year and a
consolidated and consolidating income statement and statements of cash flows and
changes in stockholders' equity of the Borrower and its Consolidated
Subsidiaries for such fiscal year, all in reasonable detail and stating in
comparative form the respective consolidated and consolidating figures for the
corresponding date and period in the prior fiscal year and all prepared in
accordance with GAAP and as to the consolidated statements accompanied by an
unqualified opinion by Ernst & Young, LLP or other independent accountants of
national standing selected by the Borrower;
(b) as soon as available and in any event within 45 days after the end of
each of the first three quarters of each fiscal year of the Borrower, a
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
of the end of such quarter and a consolidated and consolidating income statement
and statements of cash flows and changes in stockholders' equity, of the
Borrower and its Consolidated Subsidiaries for the period commencing at the end
of the previous fiscal year and ending with the end of such quarter, all in
reasonable detail and stating in comparative form the respective consolidated
and consolidating figures for the corresponding date and period in the previous
fiscal year and all prepared in accordance with GAAP and certified by the chief
financial officer of the Borrower (subject to normally recurring year-end
adjustments);
(c) (i) promptly upon receipt thereof, copies of any reports, inclusive of
any management letters, submitted to the Borrower or any of its Subsidiaries by
independent certified public accountants in connection with examination of the
financial statements of the Borrower or any such Subsidiary made by such
accountants and (ii) within five (5) Banking Days of receipt thereof, any Debt
Ratings issued by Moody's or S&P;
(d) simultaneously with the delivery of the financial statements referred
to above, a certificate substantially in the form of Exhibit J of the chief
financial officer of the Borrower (i) certifying that to the best of his
knowledge no Default or Event of Default has occurred and is continuing or, if a
Default or Event of Default has occurred and is continuing, a statement as to
the nature thereof and the action which is proposed to be taken with respect
thereto, and (ii) with computations demonstrating compliance with the covenants
contained in Article 8;
(e) simultaneously with the delivery of the annual financial statements
referred to in Section 6.8(a), a certificate of the independent public
accountants who audited such statements to the effect that, in making the
examination necessary for
the audit of such statements, they have obtained no knowledge of any condition
or event which constitutes a Default or Event of Default, or if such accountants
shall have obtained knowledge of any such condition or event, specifying in such
certificate each such condition or event of which they have knowledge and the
nature and status thereof;
(f) promptly after the commencement thereof, notice of all actions, suits,
and proceedings before any Governmental Authority, affecting the Borrower or any
of its Subsidiaries which, if determined adversely to the Borrower or such
Subsidiary, could reasonably be expected to have a Material Adverse Effect;
(g) as soon as possible, and in any event within 5 Banking Days after the
occurrence of each Default or Event of Default, a written notice setting forth
the details of such Default or Event of Default and the action which is proposed
to be taken by the Borrower with respect thereto;
(h) as soon as possible, and in any event within ten days after the
Borrower knows or has reason to know that any of the events or conditions
specified below have occurred or exist, a statement signed by a senior financial
officer of the Borrower setting forth details respecting such event or condition
and the action, if any, which the Borrower or its ERISA Affiliate proposes to
take with respect thereto (and a copy of any report or notice required to be
filed with or given to PBGC by the Borrower or an ERISA Affiliate with respect
to such event or condition):
(i) any reportable event, as defined in Section 4043(b) of ERISA, with
respect to a Plan, as to which PBGC has not by regulation waived the requirement
of Section 4043(a) of ERISA that it be notified within 30 days of the occurrence
of such event (provided that a failure to meet the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA including, without limitation,
the failure to make on or before its due date a required installment under
Section 412(m) of the Code or Section 302(e) of ERISA, shall be a reportable
event regardless of the issuance of any waivers in accordance with Section
412(d) of the Code) and any request for a waiver under Section 412(d) of the
Code for any Plan;
(ii) the distribution under Section 4041 of ERISA of a notice of
intent to terminate any Plan which is not "fully funded", as such term is
defined in Section 5.8(b), or any action taken by the Borrower or an ERISA
Affiliate to terminate any such Plan;
(iii) the institution by PBGC of pro ceedings under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer,
any Plan, or the receipt by the Borrower or any ERISA Affiliate of a notice
from a Multiemployer Plan that such action has been taken by PBGC with respect
to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a Multiemployer Plan
by the Borrower or any ERISA Affiliate that results in liability under Section
4201 or 4204 of ERISA (including the obligation to satisfy secondary liability
as a result of a purchaser default) or the receipt of the Borrower or any ERISA
Affiliate of notice from a Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary or any
Multiemployer Plan against the Borrower or any ERISA Affiliate to enforce
Section 515 of ERISA, which proceeding is not dismissed within 30 days;
(vi) the adoption of an amendment to any Plan that pursuant to Section
401(a)(29) of the Code or Section 307 of ERISA would result in the loss of tax
exempt status of the trust of which such Plan is a part if the Borrower or an
ERISA Affiliate fails to timely provide security to the Plan in accordance with
the provisions of said Sections;
(vii) any event or circumstance exists which may reasonably be
expected to constitute grounds for the Borrower or any ERISA Affiliate to
incur liability under Title IV of ERISA or under Sections 412(c)(11) or 412(n)
of the Code with respect to any Plan; and
(viii) the Unfunded Benefit Liabilities of one or more Plans equal or
exceed $5,000,000 in the aggregate;
(i) promptly after the request of the Administrative Agent, copies of each
annual report filed pursuant to Section 104 of ERISA with respect to each Plan
(including, to the extent required by Section 104 of ERISA, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information referred to in Section 103) and each
annual report filed with respect to each Plan under Section 4065 of ERISA;
provided, however, that in the case of a Multiemployer Plan, such annual reports
shall be furnished only if they are available to the Borrower or an ERISA
Affiliate;
(j) promptly after the furnishing thereof, copies of any statement or
report furnished to any other party pursuant to the terms of any indenture, loan
or credit or similar agreement and not otherwise required to be fur nished to
the Administrative Agent pursuant to any other clause of this Section 6.8;
(k) as soon as available and in any event within three (3) Banking Days
after filing the same with the Securities and Exchange Commission, but in no
event later than 110 days after the end of each fiscal quarter of the Borrower,
a true and complete copy of the Borrower's Form 10Q;
(l) as soon as available and in any event within three (3) Banking Days
after filing the same with the Securities and Exchange Commission, but in no
event later than 110 days after the end of each fiscal year of the Borrower, a
true and complete copy of the Borrower's Form 10K;
(m) promptly after the sending or filing thereof, copies of all proxy
statements, financial statements and reports which the Borrower has made
generally available to its stockholders, and copies of all regular, periodic and
special reports, and all registration statements, which the Borrower files with
the Securities and Exchange Commission or any Governmental Authority which may
be substituted therefor, or with any national securities exchange; and
(n) such other information respecting the condition or operations,
financial or otherwise, of the Bor rower or any of its Subsidiaries as the
Administrative Agent, or any Bank through the Administrative Agent, may from
time to time reasonably request.
Section 6.9. Payment of Taxes and Other Potential Charges and Priority
---------------------------------------------------------
Claims. Pay or discharge
- ------
(a) on or prior to the date on which penalties attach thereto, all taxes,
assessments and other governmental charges imposed upon it or any of its
properties;
(b) on or prior to the date when due, all lawful claims of materialmen,
mechanics, carriers, warehousemen, landlords and other like Persons which, if
unpaid, might result in the creation of a Lien upon any such property; and
(c) on or prior to the date when due, all other lawful claims which, if
unpaid, might result in the creation of a Lien upon any such property or which,
if unpaid, might give rise to a claim entitled to priority over general
creditors of the Borrower in a case under Title 11 (Bankruptcy) of the United
States Code, as amended;
provided, that unless and until foreclosure, distraint, levy, sale or similar
proceedings shall have been commenced, the Borrower need not pay or discharge
any such tax, assessment, charge or claim so long as (x) the validity thereof is
contested in good faith and by appropriate proceedings diligently conducted, and
(y) such reserves or other appropriate provisions as may be required by GAAP
shall have been made therefor.
Section 6.10. ERISA Plans. Within twelve (12) months of the later of: (i)
-----------
the date any Plan or Multiemployer Plan became a Plan or Multiemployer Plan with
respect to the employees of the Borrower and its ERISA Affiliates or (ii) the
date any such Plan or Multiemployer Plan was deemed other than "fully funded",
the Borrower shall
cause such Plan or Multiemployer Plan to be "fully funded". For purposes of this
Section 6.10, "fully funded" shall mean that the fair market value of the assets
of the Plan is not less than the present value of the accrued benefits of all
participants in the Plan, computed on a Plan termination basis.
ARTICLE 7. NEGATIVE COVENANTS.
So long as any of the Notes shall remain unpaid or any Bank shall have any
Commitment under this Agreement, the Borrower shall not:
Section 7.1. Debt. Create, incur, assume or suffer to exist, or permit any
----
of its Subsidiaries to create, incur, assume or suffer to exist any Debt,
except:
(a) Debt of the Borrower under this Agreement or the Notes;
(b) Debt described in Schedule 5.10, including renewals, extensions or
refinancings thereof, provided that the principal amount thereof does not
increase;
(c) Debt of the Borrower subordinated on terms reasonably satisfactory to
the Banks to the Borrower's obligations under this Agreement and the Notes;
(d) Debt of the Borrower to any such Subsid iary or of any Subsidiary to
the Borrower or another such Subsidiary;
(e) Debt in respect of letters of credit issued for the account of the
Borrower or any such Subsidiary in an aggregate face amount outstanding at any
time of up to $30,000,000;
(f) Debt incurred in connection with accep tances of the Borrower or any
such Subsidiary in an aggregate amount outstanding at any one time of up to
$25,000,000;
(g) Debt of any Person which becomes a
Subsidiary of the Borrower in connection with any Acceptable Acquisition
permitted by Section 7.8 or Debt which is acquired and assumed by the Borrower
or any of its Subsidiaries in connection with an Acceptable Acquisition
permitted by Section 7.8; provided that such Debt was in existence and
--------
outstanding prior to and on the date that such Person became a Subsidiary or
such Acceptable Acquisition was consummated, and such Debt was not created in
contemplation of such Person becoming a Subsidiary or such Acceptable
Acquisition being consummated, and any renewals, extensions or refinancings
thereof, provided that the principal amount thereof does not increase; and
provided, further, however, that the Debt
- -------- ------- -------
permitted by this subsection (g) shall not (i) cause the Borrower to exceed the
limitations contained in subsections (e) or (f) of this Section 7.1 or (ii)
cause the Borrower to exceed the limitation contained in subsection (h) of this
Section 7.1 after recalculating such amounts on a consolidated basis with the
acquired Debt and the acquired business or Person;
(h) Debt of the Borrower up to five percent (5%) of its total assets,
including Debt permitted by subsection (g) of this Section 7.1, as measured at
the end of the immediately preceding fiscal quarter, as calculated on a
consolidated basis in accordance with GAAP; and
(i) Debt of the Borrower or any such Subsid iary secured by purchase money
Liens permitted by Section 7.2.
Section 7.2. Liens. Create, incur, assume or suffer to exist, or permit any
-----
of its Subsidiaries to create, incur, assume or suffer to exist, any Lien, upon
or with respect to any of its properties, now owned or hereafter acquired,
except:
(a) Liens for taxes or assessments or other government charges or levies if
not yet due and payable or if due and payable if they are being contested in
good faith by appropriate proceedings and for which appropriate reserves are
maintained;
(b) Liens imposed by law, such as mechanic's, materialmen's, landlord's,
warehousemen's and carrier's Liens, and other similar Liens, securing
obligations incurred in the ordinary course of business which are not past due
for more than 30 days, or which are being contested in good faith by appropriate
proceedings and for which appropriate reserves have been established;
(c) Liens under workmen's compensation, unem ployment insurance, social
security or similar legislation (other than ERISA);
(d) Liens, deposits or pledges to secure the performance of bids, tenders,
contracts (other than contracts for the payment of money), leases (permitted
under the terms of this Agreement), public or statutory obligations, surety,
stay, appeal, indemnity, performance or other similar bonds, or other similar
obligations arising in the ordinary course of business;
(e) judgment and other similar Liens arising in connection with court
proceedings; provided that the exe cution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are being actively con tested
in good faith and by appropriate proceedings;
(f) easements, rights-of-way, restrictions and other similar encumbrances
which, in the aggregate, do not materially interfere with the occupation, use
and enjoyment by the Borrower or any such Subsidiary of the property or assets
encumbered thereby in the normal course of its business or materially impair the
value of the property sub ject thereto;
(g) Liens securing obligations of: (i) any such Subsidiary to the Borrower
or another such Subsidiary or (ii) the Borrower to any such Subsidiary;
(h) Liens securing Debt greater than $500,000 in the aggregate existing on
the Closing Date as set forth in Schedule 7.2 and Liens securing Debt equal to
or less than $500,000 in the aggregate existing on the Closing Date;
(i) Liens securing Debt permitted under Section 7.1(g), provided that such
Liens only affect property acquired in connection with the Acceptable
Acquisition pursuant to which such Debt was incurred;
(j) As at any time, Liens securing up to an aggregate of $30,000,000 of
Debt permitted under Section 7.1 (including, for purposes of determining such
aggregate amount, Debt secured by Liens permitted under other subsections of
this Section 7.2); and
(k) purchase money Liens on any property hereafter acquired or the
assumption of any Lien on property existing at the time of such acquisition, or
a Lien incurred in connection with any conditional sale or other title retention
agreement or a Capital Lease; provided that:
(i) any property subject to any of the foregoing is acquired by the
Borrower or any such Subsidiary in the ordinary course of its business and the
Lien on any such property is created contemporaneously with such acquisition;
(ii) the obligation secured by any Lien so created, assumed or
existing shall not exceed 100% of the lesser of cost or fair market value as of
the time of acquisition of the property covered thereby to the Borrower or such
Subsidiary acquiring the same;
(iii) each such Lien shall attach only to the property so acquired and
fixed improvements thereon;
(iv) the Debt secured by all such Liens shall not exceed $30,000,000
in the aggregate; and
(v) the obligations secured by such Lien are permitted by the
provisions of Section 7.1.
Section 7.3. Investments. Make, or permit any of its Subsidiaries to make,
-----------
any loan or advance to any Person or purchase or otherwise acquire, or permit
any such Subsidiary to purchase or otherwise acquire, any capital stock, assets,
obligations or other securities of, make any capital contribution to, or
otherwise invest in, or acquire any interest in, any Person, except: (a) Cash
Equivalent Investments ; (b) for stock, obligations or securities received in
settlement of debts (created in the ordinary course of business) owing to the
Borrower or any such Subsid iary; (c) any Acceptable Acquisition permitted by
Section 7.8; (d) investments by the Borrower in one of its Subsidiaries or
investments by one or more Subsidiaries of the Borrower in another Subsidiary of
the Borrower; (e) for other investments (including minority interests in joint
ventures, partnerships and other Persons that are held for investment purposes)
not exceeding $50,000,000 in the aggregate for all such investments; or (f) for
the repurchase of outstanding equity securities of the Borrower.
Section 7.4. Sale of Assets. Sell, lease, assign, transfer or otherwise
--------------
dispose of, or permit any of its Subsidiaries to sell, lease, assign, transfer
or otherwise dispose of, any of its now owned or hereafter acquired assets
(including, without limitation, shares of stock and indebtedness of such
Subsidiaries, receivables and leasehold interests); except: (a) for inventory
disposed of in the ordinary course of business; (b) the sale or other disposi
tion of assets no longer used or useful in the conduct of its business; (c) that
any such Subsidiary may sell, lease, assign, or otherwise transfer its assets to
the Borrower or any other such Subsidiary; (d) the sale or other disposition of
assets by the Borrower to its Subsidiaries with an aggregate value not exceeding
twenty percent (20%) of the consolidated revenues of the Borrower and its
Subsidiaries for the immediately preceding fiscal year; and (e) the sale or
other disposition of assets in any fiscal year to a Person other than the
Borrower, its Subsidiaries or any of their respective Affiliates with an
aggregate value not exceeding fifteen percent (15%) of the consolidated revenues
of the Borrower and its Subsidiaries for the immediately preceding fiscal year.
Section 7.5. Stock of Subsidiaries, Etc. Sell or otherwise dispose of any
--------------------------
equity interest of any of its Subsidiaries, except in connection with a
transaction permitted under Section 7.4, 7.7 or 7.8 or permit any such
Subsidiary to issue any additional equity interest to any Person other than
Borrower or another such Subsidiary, except directors' qualifying shares.
Section 7.6. Transactions with Affiliates. Enter into any transaction,
----------------------------
including, without limitation, the purchase, sale or exchange of property or the
rendering of any service, with any Affiliate (other than a Subsidiary of the
Borrower) or permit any of its Subsidiaries to enter into any such transaction,
including, without limitation, the purchase, sale or exchange of property or the
rendering of any service, with any Affiliate (other than a Subsidiary of the
Borrower), except in the ordinary course of and pursuant to the reasonable
requirements of the Borrower's or such Subsidiary's business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary than would
it obtain in a comparable arm's length transaction with a Person not an
Affiliate.
Section 7.7. Mergers, Etc. Merge or consolidate with, or sell, assign,
------------
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereaf ter acquired) to, any Person, or acquire all or substantially all of the
assets or the business of any Person (or enter into any agreement to do any of
the foregoing), or permit any of its Subsidiaries to do so, except that: (a) any
such Sub sidiary may merge into or transfer assets to the Borrower; (b) any
Subsidiary may merge into or consolidate with or transfer assets to any other
Subsidiary; (c) the Borrower or any such Subsidiary may effect any Acceptable
Acquisition permitted by Section 7.8 and (d) the Borrower or any of its
Subsidiaries may make any sale or other disposition of assets permitted by
Section 7.4.
Section 7.8. Acquisitions. Make any Acquisition other than an Acceptable
------------
Acquisition.
ARTICLE 8. FINANCIAL COVENANTS.
So long as any of the Notes shall remain unpaid or any Bank shall have any
Commitment under this Agreement:
Section 8.1. Minimum Net Worth. The Borrower shall maintain at all times a
-----------------
Net Worth of not less than: (a) $200,000,000, plus (b) the greater of zero (0)
----
or 50% of cumulative Net Income after January 31, 1996, plus (c) at such time as
----
Davidson & Associates, Inc. and Sierra Online, Inc. are acquired by the
Borrower, 50% of the Net Worth of such Persons.
Section 8.2. Leverage Ratio. The Borrower shall maintain at all times, as
--------------
measured at the end of the most recently completed fiscal quarter, a Leverage
Ratio of not greater than 3.5 to 1.0.
Section 8.3. Interest Coverage Ratio. The Borrower shall maintain at all
-----------------------
times an Interest Coverage Ratio, measured as of the end of the most recently
completed fiscal quarter, of not less than 3.5 to 1.0 at any time.
ARTICLE 9. EVENTS OF DEFAULT.
Section 9.1. Events of Default. Any of the following events shall be an
-----------------
"Event of Default":
(a) the Borrower shall: (i) fail to pay the principal of any Note as and
when due and payable; or (ii) fail to pay interest on any Note or any fee or
other
amount due hereunder within five (5) Banking Days after such amount shall
become due and payable;
(b) any representation or warranty made or deemed made by the Borrower in
this Agreement or in any other Facility Document to which it is a party or which
is contained in any certificate, document, opinion, financial or other statement
furnished at any time under or in connection with any Facility Document shall
prove to have been incorrect in any material respect on or as of the date made
or deemed made;
(c) the Borrower shall: (i) fail in any material respect to perform or
observe any term, covenant or agreement contained in Section 2.3, subsections
(e) through (i) and (l) through (n) of Section 6.8 or Articles 7 or 8; or (ii)
fail in any material respect to perform or observe any term, covenant or
agreement on its part to be performed or observed under subsections (a), (b),
(c), (d), (j) or (k) of Section 6.8 and such failure shall continue for 10
consecutive days after notice from the Administrative Agent; or (iii) fail in
any material respect to perform or observe any term, covenant or agreement on
its part to be performed or observed (other than the obligations specifically
referred to in clause (i) or (ii) or elsewhere in this Section 9.1) in any
Facility Document and such failure shall continue for 30 consecutive days after
notice from the Administrative Agent to the Borrower or from the Borrower to the
Administrative Agent;
(d) the Borrower or any of its Subsidiaries shall: (i) fail to pay any Debt
in aggregate amount in excess of $5,000,000 (other than the payment obligations
described in (a) above), of the Borrower or such Subsidiary, as the case may be,
or any interest or premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise); or (ii) fail to perform
or observe any term, covenant or condition on its part to be performed or
observed under any agreement or instrument relating to any such indebtedness,
when required to be performed or observed, if the effect of such failure to
perform or observe is to accelerate, or to permit the accel eration of, after
the giving of notice or passage of time, or both, the maturity of such Debt; or
any such Debt shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), prior to the stated
maturity thereof;
(e) the Borrower or any of its Subsidiaries: (i) shall generally not, or be
unable to, or shall admit in writing its inability to, pay its debts as such
debts become due; or (ii) shall make an assignment for the benefit of creditors,
petition or apply to any tribunal for the appointment of a custodian, receiver
or trustee for it or a substantial part of its assets; or (iii) shall commence
any proceeding under any bankruptcy, reorganization, arrangement, readjustment
of debt, dissolution or liquidation law or statute of any jurisdiction, whether
now or hereafter in effect; or (iv) shall have had any such petition or
application filed or any such proceeding shall have been commenced, against it,
in which an adjudication or appointment is made or order for relief is entered,
or which petition, application or proceeding remains undismissed for a period of
60 days or more; or (v) by any act or omission shall indicate its consent to,
approval of or acquiescence in any such
petition, application or proceeding or order for relief or the appointment of a
custodian, receiver or trustee for all or any substantial part of its property;
or (vi) shall suffer any such custodianship, receivership or trusteeship to
continue undischarged for a period of 60 days or more;
(f) one or more judgments, decrees or orders for the payment of money in
excess of $10,000,000 in the aggregate shall be rendered against the Borrower or
any of its Subsidiaries and such judgments, decrees or orders shall continue
unsatisfied and in effect for a period of 60 consecutive days without being
vacated, discharged, satisfied or stayed or bonded pending appeal;
(g) any event or condition shall occur or exist with respect to any Plan or
Multiemployer Plan concern ing which the Borrower is under an obligation to
furnish a report to the Administrative Agent in accordance with Section 6.8(h)
hereof and as a result of such event or condition, together with all other such
events or conditions, the Borrower or any ERISA Affiliate has incurred or in the
reasonable opinion of the Required Banks is reasonably likely to incur a
liability to a Plan, a Multiemployer Plan, the PBGC, or a Section 4042 Trustee
(or any combination of the foregoing) which is material in relation to the
financial position of the Borrower and its Subsidiaries, on a consolidated
basis; provided, however, that any such amount shall not be deemed to be
material so long as all such amounts do not exceed $5,000,000 in the aggregate;
(h) (i) any Person or two or more Persons acting in concert shall have
acquired beneficial ownership (within the meaning of Rules 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
greater than 50% of the outstanding shares of voting stock of the Borrower; or
(ii) during any period of 12 con secutive months, commencing before or after the
date of this Agreement, individuals who at the beginning of such 12month period
were directors of the Borrower, together with any new directors whose election
by the board of directors of the Borrower or whose nomination by stockholders of
the Borrower was approved by a majority of the directors then still in office
and who are either directors at the beginning of such period or whose election
or nomination for election was previously so approved, cease for any reason to
constitute a majority of the board of directors of the Borrower; or
(i) this Agreement or any other Facility Document or term or provision
hereof or thereof shall cease to be in full force and effect (except in
accordance with the express terms of such document), or the Borrower shall, or
purport to, terminate (except in accordance with the terms of such document),
repudiate, declare voidable or void or otherwise contest, this Agreement or any
Facility Document or any other term hereof or thereof or any obligation or
liability of the Borrower hereunder or thereunder.
Section 9.2. Remedies. If any Event of Default shall occur and be
--------
continuing, the Administrative Agent shall, upon request of the Required Banks,
by notice to the Borrower, (a) declare the Commitments to be terminated,
whereupon the same shall
forthwith terminate, and/or (b) declare the outstanding principal of the Notes,
all interest thereon and all other amounts payable under this Agreement and the
Notes to be forthwith due and payable, whereupon the Notes, all such interest
and all such amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower; provided that, in the case of an Event
of Default referred to in Section 9.1(e) above, the Commitments shall be
immediately terminated, and the Notes, all interest thereon and all other
amounts payable under this Agreement shall be immediately due and payable
without notice, presentment, demand, protest or other formalities of any kind,
all of which are hereby expressly waived by the Borrower.
ARTICLE 10. THE
ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS AND BORROWER.
Section 10.1. Appointment, Powers and Immunities of Administrative Agent.
----------------------------------------------------------
Each Bank hereby irrevocably (but subject to removal by the Required Banks
pursuant to Section 10.9) appoints and authorizes the Administrative Agent to
act as its agent hereunder and under any other Facility Document with such
powers as are specifically delegated to the Administrative Agent by the terms of
this Agreement and any other Facility Document, together with such other powers
as are reasonably incidental thereto. The Administrative Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement
and any other Facility Document, and shall not by reason of this Agreement be a
trustee for any Bank. The Administrative Agent shall not be responsible to the
Banks for any recitals, statements, representations or warranties made by the
Borrower or any officer or official of the Borrower or any other Person
contained in this Agreement or any other Facility Document, or in any
certificate or other document or instrument referred to or provided for in, or
received by any of them under, this Agreement or any other Facility Document, or
for the value, legality, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Facility Document or any other
document or instrument referred to or provided for herein or therein, for the
perfection or priority of any collateral security for the Loans or for any
failure by the Borrower to perform any of its obligations hereunder or
thereunder. The Administrative Agent may employ agents and attorneysinfact and
shall not be responsible, except as to money or securities received by it or its
authorized agents, for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Neither the
Administrative Agent nor any of its directors, officers, employees or agents
shall be liable or responsible for any action taken or omitted to be taken by it
or them hereunder or under any other Facility Document or in connection herewith
or therewith, except for its or their own gross negligence or willful
misconduct. The Borrower shall pay any fee agreed to by the Borrower and the
Administrative Agent with respect to the Administrative Agent's services
hereunder.
Section 10.2. Reliance by Administrative Agent. The Administrative Agent
--------------------------------
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telex, telegram or cable) believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat each Bank as the holder of the Loans
made by it for all purposes hereof unless and until a notice of the assignment
or transfer thereof satisfactory to the Administrative Agent signed by such Bank
shall have been furnished to the Administrative Agent but the Administrative
Agent shall not be required to deal with any Person who has acquired a
participation in any Loan from a Bank. As to any matters not expressly provided
for by this Agreement or any other Facility Document, the Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with instructions signed by the Required Banks, and such
instructions of the Required Banks and any action taken or failure to act
pursuant thereto shall be binding on all of the Banks and any other holder of
all or any portion of any Loan.
Section 10.3. Defaults. The Administrative Agent shall not be deemed to
--------
have knowledge of the occurrence of a Default or Event of Default (other than
the non-payment of principal of or interest on the Loans to the extent the same
is required to be paid to the Administrative Agent for the account of the Banks)
unless the Administrative Agent has received notice from a Bank or the Borrower
specifying such Default or Event of Default and stating that such notice is a
"Notice of Default." In the event that the Administrative Agent receives such a
notice of the occurrence of a Default or Event of Default, the Administrative
Agent shall give prompt notice thereof to the Banks (and shall give each Bank
prompt notice of each such non-payment). The Administrative Agent shall (subject
to Section 10.8) take such action with respect to such Default or Event of
Default which is continuing as shall be directed by the Required Banks; provided
that, unless and until the Administrative Agent shall have received such
directions, the Administrative Agent may 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 interest of the Banks; and provided further that the
Administrative Agent shall not be required to take any such action which it
determines to be contrary to law.
Section 10.4. Rights of Administrative Agent as a Bank. With respect to its
----------------------------------------
Commitment and the Loans made by it, the Administrative Agent in its capacity as
a Bank hereunder shall have the same rights and powers hereunder as any other
Bank and may exercise the same as though it were not acting as the
Administrative Agent, and the term "Bank" or "Banks" shall, unless the context
otherwise indicates, include the Administrative Agent in its capacity as a Bank.
The Administrative Agent and its affiliates may (without having to account
therefor to any Bank) accept deposits from, lend money to (on a secured or
unsecured basis), and generally engage in any kind of banking, trust or other
business with, the Borrower (and any of its affiliates) as if it were not acting
as the Administrative Agent, and the Administrative Agent may accept fees and
other
consideration from the Borrower for services in connection with this Agreement
or otherwise without having to account for the same to the Banks. Although the
Administrative Agent and its affiliates may in the course of such relationships
and relationships with other Persons acquire information about the Borrower, its
Affiliates and such other Persons, the Administrative Agent shall have no duty
to disclose such information to the Banks.
Section 10.5. Indemnification of Administrative Agent. The Banks agree to
---------------------------------------
indemnify the Administrative Agent (to the extent not reimbursed under Section
11.3 or 11.8 or under the applicable provisions of any other Facility Document,
but without limiting the obligations of the Borrower under Section 11.3 or 11.8
or such provisions), ratably in accordance with the aggregate unpaid principal
amount of the Loans made by the Banks (without giving effect to any
participations, in all or any portion of such Loans, sold by them to any other
Person) (or, if no Loans are at the time outstanding, ratably in accordance with
their respective Commitments), for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Administrative Agent in any way relating to or arising out
of this Agreement, any other Facility Document or any other documents
contemplated by or referred to herein or the transactions contemplated hereby or
thereby (including, with out limitation, the costs and expenses which the
Borrower is obligated to pay under Section 11.3 or 11.8 or under the applicable
provisions of any other Facility Document but excluding, unless a Default or
Event of Default has occurred, normal administrative costs and expenses incident
to the performance of its agency duties hereunder) or the enforcement of any of
the terms hereof or thereof or of any such other documents or instruments;
provided that no Bank shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the party to be
indemnified.
Section 10.6. Documents. The Administrative Agent will forward to each
---------
Bank, promptly after the Administrative Agent's receipt thereof, a copy of each
report, notice or other document required by this Agreement or any other
Facility Document to be delivered to the Administrative Agent for such Bank.
Section 10.7. Non-Reliance on Administrative Agent and Other Banks.
----------------------------------------------------
Each Bank agrees that it has, independently and without reliance on the
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Borrower and its Subsidiaries and decision to enter into this Agreement and that
it will, independently and without reliance upon the Administrative Agent or any
other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any other Facility Document.
The Administrative Agent shall not be required to keep itself informed as to the
performance or observance by the Borrower of this Agreement or any other
Facility Document or any other document referred to or provided for herein or
therein or to inspect the properties or
books of the Borrower or any Subsidiary. Except for notices, reports and other
documents and information expressly required to be furnished to the Banks by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of the Borrower or any
Subsidiary (or any of their Affiliates) which may come into the possession of
the Administrative Agent or any of its affiliates. The Administrative Agent
shall not be required to file this Agreement, any other Facility Document or any
document or instrument referred to herein or therein, for record or give notice
of this Agreement, any other Facility Document or any document or instrument
referred to herein or therein, to anyone.
Section 10.8. Failure of Administrative Agent to Act. Except for action
--------------------------------------
expressly required of the Administrative Agent hereunder, the Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances of the
indemnification obligations of the Banks under Section 10.5 in respect of any
and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.
Section 10.9. Resignation or Removal of Administrative Agent. Subject to
----------------------------------------------
the appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving written notice
thereof to the Banks and the Borrower, and the Administrative Agent may be
removed at any time with or without cause by the Required Banks; provided that
the Borrower and the other Banks shall be promptly notified thereof. Upon any
such resignation or removal, the Required Banks shall have the right to appoint
a successor Administrative Agent reasonably acceptable to the Borrower. If no
successor Administrative Agent shall have been so appointed by the Required
Banks and shall have accepted such appointment within 30 days after the retiring
Administrative Agent's giving of notice of resignation or the Required Banks'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Banks, appoint a successor Administrative Agent
(provided no Default or Event of Default shall have occurred and be continuing,
such successor shall be reasonably acceptable to the Borrower), which shall be a
bank which has an office in New York, New York with combined capital and surplus
of at least $100,000,000. The Required Banks or the retiring Administrative
Agent, as the case may be, shall upon the appointment of a successor
Administrative Agent promptly so notify the Borrower and the other Banks. Upon
the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent, the provisions of this Article 10 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Administrative Agent.
Section 10.10. Amendments Concerning Agency Function. The Administrative
-------------------------------------
Agent shall not be bound by any waiver, amendment, supplement or modification of
this Agreement or any other Facility Document which affects its duties hereunder
or thereunder unless it shall have given its prior consent thereto.
Section 10.11. Liability of Administrative Agent. The Administrative Agent
---------------------------------
shall not have any liabilities or responsibilities to the Borrower on account of
the failure of any Bank to perform its obligations hereunder or to any Bank on
account of the failure of the Borrower to perform its obligations hereunder or
under any other Facility Document.
Section 10.12. Transfer of Agency Function. Without the consent of the
---------------------------
Borrower or any Bank, the Administrative Agent may at any time or from time to
time transfer its functions as Administrative Agent hereunder to any of its
offices wherever located, provided that the Administrative Agent shall promptly
notify the Borrower and the Banks thereof.
Section 10.13. Non-Receipt of Funds by the Administrative Agent. Unless the
------------------------------------------------
Administrative Agent shall have been notified by a Bank or the Borrower (either
one as appropriate being the "Payor") prior to the date on which such Bank is to
make payment hereunder to the Administrative Agent of the proceeds of a Loan or
the Borrower is to make payment to the Administrative Agent, as the case may be
(either such payment being a "Required Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient on such date and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient of such payment
(and, if such recipient is the Borrower and the Payor Bank fails to pay the
amount thereof to the Administrative Agent forthwith upon demand, the Borrower)
shall, on demand, repay to the Administrative Agent the amount made available to
it together with interest thereon for the period from the date such amount was
so made available by the Administrative Agent until the date the Administrative
Agent recovers such amount at a rate per annum equal to the average daily
Federal Funds Rate for such period.
Section 10.14. Withholding Taxes. Each Bank represents that, as of the date
-----------------
hereof, it is entitled to receive any payments to be made to it hereunder
without the withholding of any tax and will furnish to the Administrative Agent
such forms, certifications, statements and other documents as the Administrative
Agent may request from time to time to evidence such Bank's exemption from the
withholding of any tax imposed by any jurisdiction or to enable the
Administrative Agent to comply with any applicable laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Bank is not
created or organized under the laws of the United States of America or any state
thereof, in the event that the payment of interest by the Borrower is treated
for
U.S. income tax purposes as derived in whole or in part from sources from within
the U.S., such Bank will furnish to the Administrative Agent Form 4224 or Form
1001 of the Internal Revenue Service, or such other forms, certifications,
statements or documents, duly executed and completed by such Bank as evidence of
such Bank's exemption from the withholding of U.S. tax with respect thereto,
unless it is prevented from doing so by a Regulatory Change . The Administrative
Agent shall not be obligated to make any payments hereunder to such Bank in
respect of any Loan or such Bank's Commitment if such Bank shall have failed to
comply with any requirement applicable to such Bank set forth in the preceding
sentence.
Section 10.15. Several Obligations and Rights of Banks. The failure of any
---------------------------------------
Bank to make any Loan to be made by it on the date specified therefor shall not
relieve any other Bank of its obligation to make its Loan on such date, but no
Bank shall be responsible for the failure of any other Bank to make a Loan to be
made by such other Bank. The amounts payable at any time hereunder to each Bank
shall be a separate and independent debt, and each Bank shall be enti tled to
protect and enforce its rights arising out of this Agreement, and it shall not
be necessary for any other Bank to be joined as an additional party in any
proceeding for such purpose.
Section 10.16. Pro Rata Treatment of Loans, Etc. Except to the extent
--------------------------------
otherwise provided: (a) each borrowing under Section 2.4(a) shall be made from
the Banks, each reduction or termination of the amount of the Commitments under
Section 2.7 shall be applied to the Commitments of the Banks, and each payment
of facility fee accruing under Section 2.11 shall be made for the account of the
Banks, pro rata according to the amounts of their respective unused Com
mitments; (b) each conversion under Section 2.5 of Loans of a particular type
(but not conversions provided for by Section 3.4), shall be made pro rata among
the Banks holding Loans of such type according to the respective principal
amounts of such Loans by such Banks; (c) each prepayment and payment of
principal of or interest on Syndicated Loans of a particular type and a
particular Interest Period shall be made to the Administrative Agent for the
account of the Banks holding Syndicated Loans of such type and Interest Period
pro rata in accordance with the respective unpaid principal amounts of such
Syndicated Loans of such Interest Period held by such Banks.
Section 10.17. Sharing of Payments Among Banks. If a Bank shall obtain
-------------------------------
payment of any principal of or interest on any Syndicated Loan made by it
through the exercise of any right of setoff, banker's lien, counterclaim, or by
any other means, it shall promptly purchase from the other Banks participations
in (or, if and to the extent specified by such Bank, direct interests in) the
Syndicated Loans made by the other Banks in such amounts, and make such other
adjustments from time to time as shall be equitable to the end that all the
Banks shall share the benefit of such payment (net of any expenses which may be
incurred by such Bank in obtaining or preserving such benefit) pro rata in
accordance with the unpaid principal and interest on the Syndicated Loans held
by each of them. To such end the Banks shall make appropriate adjustments among
themselves (by
the resale of participations sold or otherwise) if such payment is rescinded or
must otherwise be restored. The Borrower agrees that any Bank so purchasing a
participation (or direct interest) in the Syndicated Loans made by other Banks
may exercise all rights of setoff, banker's lien, counterclaim or similar rights
with respect to such participation (or direct interest). Nothing contained
herein shall require any Bank to exercise any such right or shall affect the
right of any Bank to exercise, and retain the benefits of exercising, any such
right with respect to any other indebtedness of the Borrower.
ARTICLE 11 MISCELLANEOUS.
Section 11.1. Amendments and Waivers. Except as otherwise expressly
----------------------
provided in this Agreement, any provision of this Agreement may be amended or
modified only by an instrument in writing signed by the Borrower, the
Administrative Agent and the Required Banks, or by the Borrower and the
Administrative Agent acting with the consent of the Required Banks, and any
provision of this Agreement may be waived by the Required Banks or by the
Administrative Agent acting with the consent of the Required Banks; provided
--------
that no amendment, modification or waiver shall, unless by an instrument signed
by all of the Banks or by the Administrative Agent acting with the consent of
all of the Banks: (a) increase or extend the term, or extend the time or waive
any requirement for the reduction or termination, of the Commitments, (b) extend
the date fixed for the payment of principal of or interest on any Loan or any
fee payable hereunder, (c) reduce the amount of any payment of principal thereof
or the rate at which interest is payable thereon or any fee payable hereunder,
(d) alter the terms of Section 10.16, Section 10.17, this Section 11.1 or the
first sentence of Section 11.5(a), (e) amend the definition of the term
"Required Banks" or (f) waive any of the conditions precedent set forth in
Article 4 hereof and provided, further, that any amendment of Article 10 hereof
-------- -------
or any amendment which increases the obligations of the Administrative Agent
hereunder shall require the consent of the Administrative Agent. No failure on
the part of the Administrative Agent or any Bank to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof or preclude
any other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
Section 11.2. Usury. Anything herein to the contrary notwithstanding, the
-----
obligations of the Borrower under this Agreement and the Notes shall be subject
to the limitation that payments of interest shall not be required to the extent
that receipt thereof would be contrary to provisions of law applicable to a Bank
limiting rates of interest which may be charged or collected by such Bank.
Section 11.3. Expenses; Taxes.
---------------
(a) The Borrower hereby agrees to pay or cause to be paid and to save the
Administrative Agent harmless against liability for the payment of all
reasonable
out-of-pocket costs and expenses (including but not limited to
reasonable fees and expenses of counsel, auditors, consulting engineers,
appraisers, and all other reasonable professional, accounting, evaluation and
consulting costs) incurred by the Administrative Agent from time to time arising
from or relating to (i) the negotiation, preparation, execution, delivery,
administration and performance of this Agreement and the other Facility
Documents or (ii) any requested amendments, modifications, supplements, waivers
or consents (whether or not ultimately entered into or granted) to this
Agreement or any other Facility Document. The Borrower further agrees to pay or
cause to be paid to save the Administrative Agent and each Bank harmless against
liability for the payment of all reasonable out-ofpocket costs and expenses
(including but not limited to reasonable fees and expenses of counsel, auditors,
consulting engineers, appraisers, and all other reasonable professional,
accounting, evaluation and consulting costs) incurred by the Administrative
Agent or any of the Banks from time to time arising from or relating to the
enforcement, defense or preservation of rights under this Agreement or any other
Facility Document (including, without limitation, to any such costs or expenses
arising from or relating to (i) collection or enforcement of an outstanding Loan
or any other amount owing hereunder or thereunder by the Administrative Agent or
any Bank, and (ii) any litigation, proceeding, dispute, workout, restructuring
or rescheduling related in any way to this Agreement or the other Facility
Documents).
(b) The Borrower hereby agrees to pay all stamp, document, transfer,
recording, filing, registration, search, sales and excise fees and taxes and all
similar impositions now or hereafter reasonably determined by the Administrative
Agent to be payable in connection with this Agreement or any other Facility
Document or any other documents, instruments or transactions pursuant to or in
connection therewith or herewith, and Borrower agrees to save the Administrative
Agent and each Bank harmless from and against any and all present or future
claims, liabilities or losses with respect to or resulting from any omission to
pay or delay in paying such fees, taxes or impositions.
Section 11.4. Survival. All representations and warranties of the Borrower
--------
contained herein or in any other Facility Document or made in connection
herewith or therewith shall survive the making of, and shall not be waived by,
the execution and delivery of this Agreement and the other Facility Documents,
any investigation by or knowledge of the Administrative Agent or any Bank, the
making of the Loans or any other event or condition whatsoever. All covenants
and agreements of the Borrower contained herein or in any other Facility
Document shall continue in full force and effect from and after the date hereof
so long as the Borrower may borrow hereunder and until repayment in full of the
Loans and all obligations of the Borrower hereunder or any other Facility
Document. Without limitation, all obligations of the Borrower hereunder or under
any other Facility Document to make payments or indemnify the Administrative
Agent or any Bank shall survive the repayment in full of all Loans and all other
obligations hereunder or under any other Facility Document, the termination of
the Commitments, and all other events and conditions whatsoever. In addition,
all obligations of each Bank to make payments to or indemnify the Administrative
Agent shall survive the payment in full by the
Borrower of all Loans and other obligations hereunder or under any other
Facility Document, the termination of the Commitments, and all other events and
conditions whatsoever.
Section 11.5. Assignment; Participations.
--------------------------
(a) This Agreement shall be binding upon, and shall inure to the benefit
of, the Borrower, the Administrative Agent, the Banks and their respective
successors and assigns, except that the Borrower may not assign or transfer its
rights or obligations hereunder without the consent of all of the Banks. Each
Bank may assign or sell participations in all or any part of any Loan or
Commitment to another bank or other entity, in which event (i) in the case of an
assignment, upon notice thereof by the Bank to the Borrower with a copy to the
Administrative Agent, the assignee shall have, to the extent of such assignment
(unless otherwise provided therein), the same rights, benefits and obligations
as it would have if it were a Bank hereunder; and (ii) in the case of a
participation, the participant shall have no rights under the Facility Documents
and all amounts payable by the Borrower under Article 3 shall be determined as
if such Bank had not sold such partic ipation. Any assignment pursuant to this
Section 11.5 shall be in an amount not less than $10,000,000, shall leave any
assigning Bank that remains a "Bank" hereunder with a Commitment of at least
$5,000,000 and, if no Default or Event of Default has occurred and is
continuing, shall be subject to the prior consent of the Borrower (which shall
not be unreasonably withheld), except that (i) no such minimum amount will be
required to be transferred or retained and no such prior consent will be
required if such assignment is necessary for regulatory purposes and (ii) no
such minimum amount will be required to be transferred and no such prior consent
will be required if the transferee is already a "Bank" or an affiliate of a
"Bank" hereunder. The agreement executed by any Bank in favor of a participant
shall not give the participant the right to require such Bank to take or omit to
take any action hereunder except action directly relating to (i) the extension
of a payment date (including the Termination Date) with respect to any portion
of the principal of or interest on any amount outstanding hereunder allocated to
such participant, (ii) the reduction of the principal amount outstanding
hereunder or (iii) the reduction of the rate of interest payable on such amount
or any amount of fees payable hereunder to a rate or amount, as the case may be,
below that which the participant is entitled to receive under its agreement with
such Bank. Such Bank may furnish any information concerning the Borrower in the
possession of such Bank from time to time to assignees and participants
(including prospective assignees and participants); provided that such Bank
shall require any such prospective assignee or such participant (prospective or
otherwise) to agree in writing to maintain the confidentiality of such
information. In connection with any assignment pursuant to this paragraph (a),
the assigning Bank shall pay the Administrative Agent an administrative fee for
processing such assignment in the amount of $2,500.
(b) In addition to the assignments and participations permitted under
paragraph (a) above, any Bank may assign and pledge, without meeting any of the
requirements of paragraph (a) above, all or any portion of its Loans and Note to
(i) any affiliate of such Bank or (ii) any Federal Reserve Bank as collateral
security pursuant to Regulation A of the Board of Governors of the Federal
Reserve System and any Operating Circular issued by such Federal Reserve Bank.
No such assignment shall release the assigning Bank from its obligations
hereunder.
Section 11.6. Notices. Unless the party to be notified otherwise notifies
-------
the other party in writing as provided in this Section, and except as otherwise
provided in this Agreement, notices shall be delivered in person or sent by
overnight courier, facsimile, ordinary mail, cable or telex addressed to such
party at its "Address for Notices" on the signature page of this Agreement.
Notices pertaining to Sections 2.4 and 2.8 may be made by telephone and shall be
confirmed in writing via telex or facsimile not later than 5 p.m. on the day
such notice is given. Notices shall be effective: (a) on the day on which
delivered to such party in person, (b) on the first Banking Day after the day on
which sent to such party by overnight courier, (c) if given by mail, 48 hours
after deposit in the mails with first-class postage prepaid, addressed as
aforesaid, and (d) if given by facsimile, cable or telex, when the facsimile,
cable or telex is transmitted to the facsimile, cable or telex number as
aforesaid; provided that notices to the Administrative Agent and the Banks shall
be effective upon receipt.
Section 11.7. Setoff. The Borrower agrees that, in addition to (and without
------
limitation of) any right of setoff, banker's lien or counterclaim a Bank may
otherwise have, upon the occurrence of any Event of Default, each Bank shall be
entitled, at its option, to offset balances (general or special, time or demand,
provisional or final) held by it for the account of the Borrower at any of such
Bank's offices, in Dollars or in any other currency, against any amount payable
by the Borrower to such Bank under this Agreement or such Bank's Notes which is
not paid when due (regardless of whether such balances are then due to the
Borrower), in which case it shall promptly notify the Borrower and the
Administrative Agent thereof; provided that such Bank's failure to give such
notice shall not affect the validity thereof. Payments by the Borrower hereunder
shall be made without setoff or counterclaim.
Section 11.8. Indemnification; Exoneration. In consideration of the
----------------------------
execution and delivery of this Agreement by the Administrative Agent and the
Banks, the Borrower will defend, indemnify, exonerate and hold harmless each
Bank, the Administrative Agent and their affiliates and each of their respective
officers, directors, stockholders, affiliates, trustees, employee and agents,
and each other Person, if any, controlling such Bank or any of its affiliates
(herein collectively called the "Indemnitees") from and against any and all
actions, causes of action, suits, losses, liabilities and damages, and expenses
in connection therewith, including without limitation reasonable counsel fees
and disbursements incurred in the investigation and defense of claims and
actions (herein collectively called the "Indemnified Liabilities"), incurred by
the Indemnitees or any of them as a result of, or arising out of or relating to
the execution, delivery, performance or
enforcement of this Agreement, the Notes, or any other Facility Document, or any
instrument or document contemplated hereby or thereby by any of the Indemnitees,
or by any act, event or transaction related or attendant thereto or contemplated
hereby or thereby, or any action or inaction by any Indemnitee under or in
connection therewith, or the falseness of any representation or warranty made by
or on behalf of the Borrower, except for any Indemnified Liabilities that are
finally judicially determined to have resulted from the any Indemnitee's gross
negligence or willful misconduct, and if and to the extent that the foregoing
may be unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment and satisfaction of each of the Indemnified
Liabilities that is permissible under applicable law. The obligations of the
Borrower under this Section 11.8 shall be in addition to any liability that the
Borrower may otherwise have and shall survive the payment or prepayment in full
or transfer of any Note, the termination of the Bank's obligations hereunder and
the enforcement of any provision hereof or thereof.
SECTION 11.9. JURISDICTION; IMMUNITIES.
--------------------------------------
(a) THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW
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YORK STATE OR UNITED STATES FEDERAL COURT SITTING IN NEW YORK COUNTY, NEW YORK
- ------------------------------------------------------------------------------
OVER ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
- -----------------------------------------------------------------------------
THE NOTES, AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT
- --------------------------------------------------------------------------------
OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE
- -------------------------------------------------------------------------------
OR FEDERAL COURT. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND
- -----------------------------------------------------------------------------
ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF SUCH
- -----------------------------------------------------------------------------
PROCESS TO THE BORROWER AT ITS ADDRESS SPECIFIED IN SECTION 11.6. THE BORROWER
- ------------------------------------------------------------------------------
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
- ----------------------------------------------------------------------
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
- --------------------------------------------------------------------------------
IN ANY OTHER MANNER PROVIDED BY LAW. THE BORROWER FURTHER WAIVES ANY OBJECTION
- ------------------------------------------------------------------------------
TO VENUE IN SUCH STATE AND ANY OBJECTION TO AN ACTION OR PROCEEDING IN SUCH
- ---------------------------------------------------------------------------
STATE ON THE BASIS OF FORUM NON CONVENIENS. THE BORROWER FURTHER AGREES THAT ANY
- --------------------------------------------------------------------------------
ACTION OR PROCEEDING BROUGHT AGAINST THE ADMINISTRATIVE AGENT SHALL BE BROUGHT
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ONLY IN NEW YORK STATE OR UNITED STATES FEDERAL COURT SITTING IN NEW YORK
- -------------------------------------------------------------------------
COUNTY, NEW YORK. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH BANK EACH
- ---------------------------------------------------------------------------
WAIVES ANY RIGHT IT MAY HAVE TO JURY TRIAL.
- --------------------------------------------
(b) Nothing in this Section 11.9 shall affect the right of the
Administrative Agent or any Bank to serve legal process in any other manner
permitted by
law or affect the right of the Administrative Agent or any Bank to bring any
action or proceeding against the Borrower or its property in the courts of any
other jurisdictions.
(c) To the extent that the Borrower has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether from
service or notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) with respect to itself or its property, the Borrower
hereby irrevocably waives such immunity in respect of its obligations under this
Agreement and the Notes.
Section 11.10. Table of Contents; Headings. Any table of contents and the
------------------
headings and captions hereunder are for convenience only and shall not affect
the interpretation or construction of this Agreement.
Section 11.11. Severability. The provisions of this Agreement are intended
------------
to be severable. If for any reason any provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction, such provision
shall, as to such jurisdiction, be ineffective to the extent of such invalidity
or unenforceability without in any manner affecting the validity or
enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
Section 11.12. Counterparts. This Agreement may be executed in any number
------------
of counterparts, all of which taken together shall constitute one and the same
instrument, and any party hereto may execute this Agreement by signing any such
counterpart.
Section 11.13. Integration. The Facility Documents set forth the entire
-----------
agreement among the parties hereto relating to the transactions contemplated
thereby and supersede any prior oral or written statements or agreements with
respect to such transactions.
SECTION 11.14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
----------------------------------------------------------------------
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK
- ------------------------------------------------------------------------------
WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
- ------------------------------------------------------------------
Section 11.15. Confidentiality. Each Bank and the Administrative Agent
---------------
agrees (on behalf of itself and each of its affiliates, directors, officers,
employees and representatives) to use its best efforts to keep confidential, in
accordance with safe and sound banking practices, any non-public information
supplied to it by the Borrower pursuant to this Agreement, provided that nothing
herein shall limit the disclosure of any such information (i) to the extent
required by statute, rule, regulation or judicial process, (ii) to counsel for
any of the Banks or the Administrative Agent, (iii) to bank examiners, auditors
or accountants, (iv) in connection with any litigation concerning the Borrower
to which any one or more of the Banks is a party or (v) to any assignee or
participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the
respective Bank a Confidentiality Agreement in substantially the form of Exhibit
G hereto; and provided, further, that in no event shall any Bank or the
-------- -------
Administrative Agent be obligated or required to return any materials furnished
by the Borrower, unless reasonably requested to do so in writing by the
Borrower.
Section 11.16. Treatment of Certain Information. The Borrower (a)
--------------------------------
acknowledges that services may be offered or provided to it (in connection with
this Agreement or other wise) by each Bank or by one or more of their respective
sub sidiaries or affiliates and (b) acknowledges that information delivered to
each Bank by the Borrower may be provided to each such subsidiary and affiliate.
Section 11.17. Changes in Accounting Principles.
--------------------------------
(a) If any changes in accounting principles from those used in the
preparation of the financial statements referred to in Section 5.5 are hereafter
occasioned by the promulgation of rules, regulations, pronouncements, or
opinions of, or required by, the Financial Accounting Standards Review Board of
the American Institute of Certified Public Accountants (or successors thereto or
agencies with similar functions), or there shall occur any change in the
Borrower's or any Subsidiary's fiscal or tax years and, as a result of any such
changes, there shall result a change in the method of calculating any of the
financial covenants, negative covenants, standards, or other terms or conditions
found in this Agreement or any other Facility Document, or
(b) If the Borrower, for reasonable business purposes, shall desire to
change such accounting principles or the application thereof (which change shall
be consistent with accounting principles then in effect pursuant to rules,
regulations, pronouncements, or opinions or the Financial Accounting Standards
Review Board of the American Institute of Certified Public Accountants) and such
desired change would result in a change in the method of calculating any of the
financial covenants, negative covenants or other terms and conditions found in
this Agreement or any other Facility Document, then the parties hereto agree to
enter into negotiations in order to amend such provisions and the definition of
GAAP set forth in Section 1.1 so as to reflect equitably such changes with the
desired result that the criteria for evaluating the financial condition and
performance of the Borrower and its Subsidiaries shall be the same after such
changes as if such changes had not been made.
Section 11.18. Independence of Covenants. All covenants hereunder shall be
-------------------------
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant shall
not avoid the occurrence of a Default or Event of Default if such action is
taken or condition exists.
Section 11.19. Time of the Essence. Time and punctuality shall be of the
-------------------
essence with respect to this instrument, but no delay or failure of the
Administrative Agent or any Bank to enforce any of the provisions herein
contained and no conduct or statement of the Administrative Agent or any Bank
shall waive or affect any of the Administrative Agent's or any Bank's rights
hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
CUC INTERNATIONAL INC.
By /s/ E. Kirk Shelton
-------------------------
E. Kirk Shelton
President and Chief Operating Officer
Address for Notices:
707 Summer Street Stamford,
Connecticut 06901 Facsimile
No.: (203) 348-4528
CO-AGENTS:
---------
THE CHASE MANHATTAN BANK, N.A.
By
---------------------------
Susan Timmerman
Vice President
Address for Notices:
999 Broad Street, 2nd Floor
Bridgeport, Connecticut 06604
Facsimile No.: (203) 382-6573
BANK OF MONTREAL
By /s/ Brian L. Banke
-------------------
Name: Brian L. Banke
Title: Director
Address for Notices:
430 Park Avenue
New York, New York 10022
Facsimile No.: (212) 605 1454
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By
-------------------
Name:
Title:
Address for Notices:
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----------------------------
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Facsimile No.:
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THE SAKURA BANK, LIMITED
By /s/ Masahiro Nakajo
-----------------------
Name: Masahiro Nakajo
Title: Senior Vice President & Manager
Address for Notices:
The Sakura Bank, Limited
277 Park Avenue
New York, New York 10172
Facsimile No.: (212) 888-7651
ADMINISTRATIVE AGENT:
---------------------
THE CHASE MANHATTAN BANK, N.A.
By /s/ Susan Timmerman
-------------------
Susan Timmerman
Vice President
Address for Notices:
999 Broad Street, 2nd Floor
Bridgeport, Connecticut 06604
Facsimile No.: (203) 382-6573
BANKS:
------
THE CHASE MANHATTAN BANK, N.A.
By /s/ Susan Timmerman
-------------------
Susan Timmerman
Vice President
Address for Notices:
999 Broad Street, 2nd Floor
Bridgeport, Connecticut 06604
Facsimile No.: (203) 382-6573
BANK OF MONTREAL
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Eugenia Wilds
-------------------------
Name: Eugenia Wilds
Title: Vice President
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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THE SAKURA BANK, LIMITED
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
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Facsimile No.:
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ABN AMRO BANK N.V.
NEW YORK BRANCH
By /s/ Frances O. Logan
-------------------------------
Name:Frances O. Logan
Title: Vice President
By /s/ Thomas T. Rogers
-------------------------------
Name:Thomas T. Rogers
Title: Assistant Vice President
Address for Notices:
500 Park Avenue
New York, New York 10022
Facsimile No.: (212) 446-4203
THE BANK OF NEW YORK
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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FIRST AMERICAN NATIONAL BANK
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
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Facsimile No.:
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FIRST UNION NATIONAL BANK
By /s/ Susan E. Scott
---------------------------
Name: Susan E. Scott
Title: Senior Vice President
Address for Notices:
Att: Mark P. Smith
First Union National Bank
550 Broad Street NJ1535
Newark, NJ 07102
Facsimile No.: (201) 565-5808
FLEET NATIONAL BANK OF
CONNECTICUT
By /s/ Jane C. Lee
-------------------------
Name: Jane C. Lee
Title: Vice President
Address for Notices:
One Landmark Square, 12th Floor
Stamford, CT
06904-1454
Facsimile No.: (203) 358-6111
THE INDUSTRIAL BANK OF JAPAN
TRUST COMPANY
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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MELLON BANK, N.A.
By /s/ David N. Smith
-------------------------
Name: David N. Smith
Title: Vice President
Address for Notices:
65 East 55th Street, 15th Floor
New York, New York 10022
Facsimile No.: 212-702-5269
THE MITSUBISHI BANK, LIMITED
By /s/ David A. Kelson
-----------------------
Name: David A. Kelson
Title: Vice President
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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ROYAL BANK OF CANADA
By /s/ Sheryl L. Greenberg
--------------------------
Name: Sheryl L. Greenberg
Title: Manager
Address for Notices:
Royal Bank of Canada
Financial Square, 23rd Flr.
New York, N.Y. 10005-3531
Facsimile No.: (212) 428-2372
THE SANWA BANK, LTD.
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
----------------------------
----------------------------
Facsimile No.:
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THE SUMITOMO BANK, LIMITED,
NEW YORK BRANCH
By /s/ Yoshinori Kawamura
Name: Yoshinori Kawamura
Title: Joint General Manager
Address for Notices:
277 Park Avenue, 6th Floor
New York, NY 10172
Attention: Jeff Toner
Facsimile No.: (212) 224-5188
THE FUJI BANK, LIMITED
NEW YORK BRANCH
By
-----------------------
Name:
Title:
Address for Notices:
----------------------------
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----------------------------
Facsimile No.:
-------------