EXHIBIT 4.9
$100,000,000
CREDIT AGREEMENT
dated as of
January 13, 1999
among
UNOVA, Inc.
The Banks Listed Herein
and
Morgan Guaranty Trust Company of New York,
as Agent
_______________________________________________________
J.P. Morgan Securities Inc.,
Arranger
TABLE OF CONTENTS
PAGE
----
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.02. Accounting Terms and Determinations . . . . . . . . . . . . . 16
SECTION 1.03. Types of Borrowings . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend . . . . . . . . . . . . . . . . . . . . . 17
SECTION 2.02. Notice of Committed Borrowings. . . . . . . . . . . . . . . . 17
SECTION 2.03. Money Market Borrowings . . . . . . . . . . . . . . . . . . . 17
SECTION 2.04. Notice to Banks; Funding of Loans . . . . . . . . . . . . . . 22
SECTION 2.05. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.06. Maturity of Loans . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.07. Interest Rates. . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.08. Facility Fee. . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.09. Optional Termination or Reduction of Commitments. . . . . . . 27
SECTION 2.10. Scheduled Termination or Reduction of Commitments . . . . . . 27
SECTION 2.11. Optional Prepayments. . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.12. General Provisions as to Payments . . . . . . . . . . . . . . 28
SECTION 2.13. Funding Losses. . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.14. Computation of Interest and Fees. . . . . . . . . . . . . . . 29
SECTION 2.15. Regulation D Compensation . . . . . . . . . . . . . . . . . . 29
ARTICLE III
CONDITIONS
SECTION 3.01. Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.02. Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . 31
2
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power . . . . . . . . . . . . . . . . 31
SECTION 4.02. Corporate and Governmental Authorization;
No Contravention. . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.03. Binding Effect. . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.04. Financial Information . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.05. Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.06. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.07. Environmental Matters . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.08. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.09. Material Subsidiaries . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.10. Not an Investment Company . . . . . . . . . . . . . . . . . . 34
SECTION 4.11. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.12. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.13. Year 2000 Compliance. . . . . . . . . . . . . . . . . . . . . 35
ARTICLE V
COVENANTS
SECTION 5.01. Information . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 5.02. Maintenance of Property; Insurance. . . . . . . . . . . . . . 37
SECTION 5.03. Conduct of Business and Maintenance of Existence. . . . . . . 37
SECTION 5.04. Compliance with Laws. . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.05. Leverage Ratio. . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.06. Maintenance of Certain Operations . . . . . . . . . . . . . . 38
SECTION 5.07. Limitation on Subsidiary Debt.. . . . . . . . . . . . . . . . 38
SECTION 5.08. Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.09. Consolidations, Mergers and Sales of Assets . . . . . . . . . 39
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 6.02. Notice of Default . . . . . . . . . . . . . . . . . . . . . . 42
3
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment and Authorization.. . . . . . . . . . . . . . . . 42
SECTION 7.02. Agent and Affiliates. . . . . . . . . . . . . . . . . . . . . 42
SECTION 7.03. Action by Agent . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 7.04. Consultation with Experts . . . . . . . . . . . . . . . . . . 42
SECTION 7.05. Liability of Agent. . . . . . . . . . . . . . . . . . . . . . 42
SECTION 7.06. Indemnification . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 7.07. Credit Decision . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 7.08. Successor Agent . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 7.09. Agent's Fees. . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair. . . 44
SECTION 8.02. Illegality. . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 8.03. Increased Cost and Reduced Return . . . . . . . . . . . . . . 45
SECTION 8.04. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 8.05. Base Rate Loans Substituted for Affected Fixed Rate Loans . . 48
SECTION 8.06. Substitution of Bank. . . . . . . . . . . . . . . . . . . . . 49
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 9.02. No Waivers. . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.03. Expenses; Indemnification . . . . . . . . . . . . . . . . . . 50
SECTION 9.04. Sharing of Set-Offs . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.05. Amendments and Waivers. . . . . . . . . . . . . . . . . . . . 51
SECTION 9.06. Successors and Assigns. . . . . . . . . . . . . . . . . . . . 51
SECTION 9.07. Collateral. . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 9.08. Governing Law; Submission to Jurisdiction . . . . . . . . . . 52
SECTION 9.09. Counterparts; Integration . . . . . . . . . . . . . . . . . . 52
SECTION 9.10. WAIVER OF JURY TRIAL. . . . . . . . . . . . . . . . . . . . . 52
4
Schedule I - Pricing Schedule
Exhibit A - Note
Exhibit B - Money Market Quote Request
Exhibit C - Invitation for Money Market Quotes
Exhibit D - Money Market Quote
Exhibit E - Opinion of Counsel for the Borrower
Exhibit F - Opinion of Special Counsel for the Agent
Exhibit G - Assignment and Assumption Agreement
CREDIT AGREEMENT
AGREEMENT dated as of January 13, 1999 among UNOVA, INC., the BANKS
party hereto and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent.
W I T N E S S E T H:
The parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used herein, have the
following meanings:
"Absolute Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Adjusted CD Rate" has the meaning set forth in Section 2.07(b).
"Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted
to the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means any Person (other than a Subsidiary) directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Borrower. For the purposes of this definition, "control"
when used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent" means Morgan Guaranty Trust Company of New York in its capacity
as agent for the Banks under the Financing Documents, and its successors in
such capacity.
"Applicable Lending Office" means, with respect to any Bank, (i) in the
case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of
its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case
of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" has the meaning set forth in Section 2.07(b).
"Assignee" has the meaning set forth in Section 9.06(c).
"Bank" means each financial institution listed on the signature pages
hereof, each Assignee which becomes a Bank pursuant to Section 9.06(c), and
their respective successors.
"Base Rate" means, for any day, a rate per annum equal to the higher of
(i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan made or to be made by a Bank as
a Base Rate Loan in accordance with the applicable Notice of Committed
Borrowing or pursuant to Article VIII.
"Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer
Plan and which is maintained or otherwise contributed to by any member of the
ERISA Group.
"Borrower" means UNOVA, Inc., a Delaware corporation, and its successors.
"Borrower's 1997 Form 10-K" means the Borrower's annual report on Form 10-K
for the fiscal year ended December 31, 1997, as filed with the Securities and
Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended.
"Borrower's Latest Form 10-Q" means the Borrower's quarterly report on
Form 10-Q for the quarter ended September 30, 1998, as filed with the
Securities Exchange Commission pursuant to the Securities Exchange Act of 1934,
as amended.
"Borrowing" has the meaning set forth in Section 1.03.
"Capital Lease" means a lease that would be capitalized on a balance sheet
of the lessee prepared in accordance with generally accepted accounting
principles.
"CD Base Rate" has the meaning set forth in Section 2.07(b).
"CD Loan" means a Committed Loan made or to be made by a Bank as a CD Loan
in accordance with the applicable Notice of Committed Borrowing.
2
"CD Margin" has the meaning set forth in Section 2.07(b).
"CD Reference Banks" means Citibank, N.A., Deutsche Bank AG New York
Branch and Morgan Guaranty Trust Company of New York, or such other bank or
banks as the Borrower and the Agent may from time to time mutually designate.
"Change of Control" means any of the following:
(a) An acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30 percent
or more of either (i) the then outstanding shares of common stock of the
Borrower (the "Outstanding Borrower Common Stock") or (ii) the combined
voting power of the then outstanding voting securities of the Borrower
entitled to vote generally in the election of directors (the "Outstanding
Borrower Voting Securities"); excluding, however, the following acquisitions
of Outstanding Borrower Common Stock and Outstanding Borrower Voting
Securities: (i) any acquisition by the Borrower, (ii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the
Borrower or any corporation controlled by the Borrower, or (iii) any
acquisition by any Person pursuant to a transaction which complies with
clauses (i), (ii) and (iii) of subsection (c) of this definition; or
(b) Individuals who, as of the Effective Date, constitute the Board of
Directors of the Borrower (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; PROVIDED, however, that any
individual who becomes a member of the Board subsequent to the Effective Date
whose election, or nomination for election by the Borrower's shareholders,
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but PROVIDED FURTHER that any such individual
whose initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board shall not be so considered as a member of the Incumbent
Board; or
(c) The approval by the shareholders of the Borrower of a reorganization,
merger or consolidation or sale or other disposition of all or substantially
all of the assets of the Borrower (a "Business Combination"), or if
consummation of such Business Combination is subject, at the time of such
approval by shareholders, to the consent of any government or governmental
agency, obtaining of such consent (either explicitly or implicitly by
consummation); excluding, however, such a
3
Business Combination pursuant to which (i) all or substantially all of the
individuals and entities who are the beneficial owners, respectively, of the
Outstanding Borrower Common Stock and Outstanding Borrower Voting Securities
immediately prior to such Business Combination will beneficially own,
directly or indirectly, more than 60 percent of, respectively, the then
outstanding shares of common stock, and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such
Business Combination (including, without limitation, a corporation which as a
result of such transaction owns the Borrower or all or substantially all of
the Borrower's assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Borrower Common Stock and
Outstanding Borrower Voting Securities, as the case may be, (ii) no Person
(other than any employee benefit plan (or related trust) sponsored or
maintained by the Borrower or any corporation controlled by the Borrower or
such corporation resulting from such Business Combination) will beneficially
own, directly or indirectly, 30 percent or more of, respectively, the
outstanding shares of common stock of the corporation resulting from such
Business Combination or the combined voting power of the outstanding voting
securities of such corporation entitled to vote generally in the election of
directors except to the extent that such ownership existed with respect to
the Borrower prior to the Business Combination and (iii) at least a majority
of the members of the board of directors of the corporation resulting from
such Business Combination will have been members of the Incumbent Board at
the time of the execution of the initial agreement, or of the action of the
Board, providing for such Business Combination; or
(d) The approval by the shareholders of the Borrower of a complete
liquidation or dissolution of the Borrower.
"Commitment" means (i) with respect to each Bank listed on the signature
pages hereof, the amount set forth opposite the name of such Bank on the
signature pages of this Agreement and (ii) with respect to each Assignee
which becomes a Bank pursuant to Section 9.06(c), the amount of the Commitment
thereby assumed by it, in each case as such amount may be changed from time to
time pursuant to Sections 2.09 and 9.06(c).
"Committed Loan" means a loan made or to be made by a Bank pursuant to
Section 2.01.
"Consolidated Current Liabilities" means at any date the consolidated
current liabilities of the Borrower and its Consolidated Subsidiaries
determined as of such date.
4
"Consolidated Debt" means, at any date, the Debt of the Borrower and its
Consolidated Subsidiaries, determined on a consolidated basis as of such date.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus, to the extent deducted in the determination of such
Consolidated Net Income, (i) interest expense for such period, (ii) the
provision for income taxes for such period, (iii) depreciation and
amortization expense for such period and (iv) non-cash write-offs of
in-process research and development costs during such period in connection
with acquisitions; PROVIDED that the aggregate amount of such write-offs
subsequent to the date of this Agreement added pursuant to this clause (iv)
during the term of this Agreement shall not exceed $250,000,000.
"Consolidated Net Assets" means at any date Consolidated Total Assets
less Consolidated Current Liabilities, all determined as of such date.
"Consolidated Net Income" means, for any period, the net income of the
Borrower and its Consolidated Subsidiaries for such period, determined on a
consolidated basis.
"Consolidated Net Worth" means at any date the shareholders' investment
in the Borrower and its Consolidated Subsidiaries determined on a consolidated
basis of such date.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which would be consolidated with those of the Borrower
in its consolidated financial statements if such statements were prepared as
of such date.
"Consolidated Total Assets" means at any date the total assets of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated
basis as of such date.
"D&P" means Duff & Phelps Credit Rating Co., and its successors.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable and deferred employee
compensation obligations arising in the ordinary course of business, (iv) all
obligations of such Person as lessee which are capitalized in accordance with
generally accepted accounting principles, (v) all unpaid reimbursement
obligations of such Person in respect of letters of credit or similar
instruments but only to the extent that either
5
(x) the issuer has honored a drawing thereunder or (y) payment of such
obligation is otherwise due under the terms thereof, (vi) all Debt secured by
a Lien on any asset of such Person, whether or not such Debt is otherwise an
obligation of such Person, and (vii) all Debt of others Guaranteed by such
Person.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Derivatives Obligations" of any Person means all obligations of such
Person in respect of any rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of the foregoing transactions) or any combination of the foregoing
transactions.
"Domestic Business Day" means any day except a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by
law to close.
"Domestic Lending Office" means, as to each Bank, its office located at
its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Domestic Lending Office) or such
other office as such Bank may hereafter designate as its Domestic Lending
Office by notice to the Borrower and the Agent; PROVIDED that any Bank may so
designate separate Domestic Lending Offices for its Base Rate Loans, on the
one hand, and its CD Loans, on the other hand, in which case all references
herein to the Domestic Lending Office of such Bank shall be deemed to refer
to either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in Section
2.07(b).
"Effective Date" means the date the Commitments become effective in
accordance with Section 3.01.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to the
environment, the
6
effect of the environment on human health or to emissions, discharges or
releases of pollutants, contaminants, 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, Hazardous Substances or wastes or the clean-up or
other remediation thereof.
"Equity Security" means any capital stock or other equity security, or
any warrant or other right to purchase such an equity security.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the
Internal Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office, branch
or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by
notice to the Borrower and the Agent.
"Euro-Dollar Loan" means a Committed Loan made or to be made by a Bank
as a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section 2.07(c).
"Euro-Dollar Reference Banks" means the principal London offices of
Citibank, N.A., Deutsche Bank AG and Morgan Guaranty Trust Company of New
York, or such other bank or banks as the Borrower and the Agent may from time
to time mutually designate.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
7
Reserve System in New York City with deposits exceeding five billion dollars
in respect of "Eurocurrency liabilities" (or in respect of any other category
of liabilities which includes deposits by reference to which the interest
rate on Euro-Dollar Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-United States office of
any Bank to United States residents).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day (the "accrual date"), the rate
per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) equal
to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers
on the accrual date, as published by the Federal Reserve Bank of New York on
the Domestic Business Day next succeeding such day, PROVIDED that (i) if the
accrual date is not a Domestic Business Day, the Federal Funds Rate for the
accrual date shall be such rate on such transactions on the next preceding
Domestic Business Day as so published on the next succeeding Domestic
Business Day, and (ii) if no such rate is so published on such next
succeeding Domestic Business Day, the Federal Funds Rate for the accrual date
shall be the average rate quoted to Morgan Guaranty Trust Company of New York
on the accrual date (or next preceding Domestic Business Day) on such
transactions as determined by the Agent.
"Financing Documents" means this Agreement and the Notes.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money Market
Loans (excluding Money Market LIBOR Loans bearing interest at the Base Rate
pursuant to Section 8.01(a)) or any combination of the foregoing.
"Foreign Debt" means Debt incurred by a Subsidiary organized under the
laws of a jurisdiction outside the United States (or incurred through a
branch or office outside the United States of a Subsidiary organized under
the laws of a jurisdiction within the United States) which Debt is incurred
with a view to obtaining financial or tax benefits associated with the
foreign operations of such Subsidiary (including without limitation currency
hedging).
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by agreement to keep-well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for the
purpose of
8
assuring in any other manner the holder of such Debt of the payment thereof
or to protect such holder against loss in respect thereof (in whole or in
part), PROVIDED that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives,
by-products and other hydrocarbons, or any substance having any constituent
elements displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.03(b).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending
one, two, three or six months thereafter, as the Borrower may elect in the
applicable Notice of Borrowing; PROVIDED that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business Day
of a calendar month; and
(c) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date;
(2) with respect to each CD Borrowing, the period commencing on the
date of such Borrowing and ending 30, 60, 90 or 180 days thereafter,
as the Borrower may elect in the applicable Notice of Borrowing;
PROVIDED that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
9
(b) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date;
(3) with respect to each Base Rate Borrowing, the period commencing
on the date of such Borrowing and ending 30 days thereafter; PROVIDED
that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date;
(4) with respect to each Money Market LIBOR Borrowing, the period
commencing on the date of such Borrowing and ending such whole number
of months thereafter as the Borrower may elect in accordance with
Section 2.03; PROVIDED that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business Day
of a calendar month; and
(c) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date;
(5) with respect to each Money Market Absolute Rate Borrowing, the
period commencing on the date of such Borrowing and ending such number of
days thereafter (but not less than 7 days) as the Borrower may elect in
accordance with Section 2.03; PROVIDED that:
(a) any Interest Period which would otherwise end on a day which is not
a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day; and
10
(b) any Interest Period which would otherwise end after the Termination
Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Leverage Ratio" means, at any date, the ratio of Consolidated Debt at
such date to Consolidated EBITDA for the period of four consecutive fiscal
quarters most recently ended on or prior to such date; PROVIDED that if there
shall have been an acquisition or disposition of operations during such
period, Consolidated EBITDA shall be calculated on a pro forma basis giving
effect thereto as if such acquisition or disposition had occurred on the
first day of such period.
"LIBOR Auction" means a solicitation of Money Market Quotes setting
forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.03.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, the Borrower or any Subsidiary
shall be deemed to own subject to a Lien any asset which it has acquired or
holds subject to the interest of a vendor or lessor under any conditional
sale agreement, capital lease or other title retention agreement relating to
such asset.
"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money Market
Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money Market
Loans or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in Section
2.07(c).
"Material Adverse Effect" means (i) any material adverse effect on the
business, financial position, results of operations or prospects of the
Borrower and its Subsidiaries, taken as a whole or (ii) any material adverse
effect on any of the rights and remedies of the Agent and the Banks under
this Agreement and the Notes.
"Material Debt" means Debt (other than the Notes) of the Borrower and/or
one or more of its Subsidiaries, arising in one or more related or unrelated
transactions, in an aggregate principal amount exceeding $25,000,000.
"Material Financial Obligations" means a principal amount of Debt and/or
payment or collateralization obligations in respect of Derivatives Obligations
of
11
the Borrower and/or one or more of its Subsidiaries, arising in one or more
related or unrelated transactions, exceeding in the aggregate $25,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $25,000,000.
"Material Subsidiary" means any Subsidiary, including its Subsidiaries,
which meets any of the following conditions:
(1) the Borrower's and its other Subsidiaries' investments in and
advances to such Subsidiary exceed 5 percent of the total assets of
the Borrower and its Subsidiaries consolidated as of the end of the
most recently completed fiscal year; or
(2) the Borrower's and its other Subsidiaries' proportionate share of
the total assets (after intercompany eliminations) of such Subsidiary
exceeds 5 percent of the total assets of the Borrower and its
Subsidiaries consolidated as of the end of the most recently completed
fiscal year; or
(3) the Borrower's and its other Subsidiaries' equity in the income
from continuing operations before income taxes, extraordinary items
and cumulative effect of a change in accounting principle of such
Subsidiary exceeds 5 percent of such income of the Borrower and its
Subsidiaries consolidated for the most recently completed fiscal year.
Computational note: For purposes of making the prescribed income test
the following guidance should be applied:
1. When a loss has been incurred by either the Borrower and its
Subsidiaries consolidated or the tested Subsidiary, but not both, the equity
in the income or loss of the tested Subsidiary should be excluded from the
income of the Borrower and its Subsidiaries consolidated for purposes of the
computation.
2. If income of the Borrower and its Subsidiaries consolidated for the
most recent fiscal year is at least 5 percent lower than the average of the
income for the last five fiscal years, such average income should be
substituted for purposes of the computation. Any loss years should be
omitted for purposes of computing average income.
"Money Market Absolute Rate" has the meaning set forth in Section
2.03(d).
12
"Money Market Absolute Rate Loan" means a loan made or to be made by a
Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
Lending Office or such other office, branch or affiliate of such Bank as it
may hereafter designate as its Money Market Lending Office by notice to the
Borrower and the Agent; PROVIDED that any Bank may from time to time by
notice to the Borrower and the Agent designate separate Money Market Lending
Offices for its Money Market LIBOR Loans, on the one hand, and its Money
Market Absolute Rate Loans, on the other hand, in which case all references
herein to the Money Market Lending Office of such Bank shall be deemed to
refer to either or both of such offices, as the context may require.
"Money Market LIBOR Loan" means a loan made or to be made by a Bank
pursuant to a LIBOR Auction (including such a loan bearing interest at the
Base Rate pursuant to Section 8.01(a)).
"Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section 2.03(d).
"Money Market Quote" means an offer by a Bank to make a Money Market
Loan in accordance with Section 2.03.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions in
an amount exceeding $1,000,000 per annum or has within the preceding five
plan years made such contributions, including for these purposes any Person
which ceased to be a member of the ERISA Group during such five year period.
"Notes" means promissory notes of the Borrower, substantially in the
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay
the Loans, and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as defined
in Section 2.02) or a Notice of Money Market Borrowing (as defined in Section
2.03(f)).
"Parent" means, with respect to any Bank, any Person controlling such
Bank.
13
"Participant" has the meaning set forth in Section 9.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person
which was at such time a member of the ERISA Group for employees of any
Person which was at such time a member of the ERISA Group.
"Pricing Schedule" means the Schedule attached hereto identified as such.
"Prime Rate" means the rate of interest publicly announced by Morgan
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.
"Rating Agencies" means D&P, Moody's and S&P.
"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any
one of such Reference Banks.
"Refunding Borrowing" means a Committed Borrowing which, after
application of the proceeds thereof, results in no net increase in the
outstanding principal amount of Committed Loans made by any Bank.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having at least 60% of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing at least 60% of the aggregate unpaid
principal amount of the Loans.
"Revolving Credit Period" means the period from and including the
Effective Date to but not including the Termination Date.
14
"S&P" means Standard & Poor's Ratings Services, and its successors.
"Subsidiary" means any corporation or other entity of which securities
or other ownership interests having ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions are
at the time directly or indirectly owned by the Borrower (or, if such term is
used with reference to another Person, by such other Person).
"Termination Date" means January 12, 2000 (or if such date is not a
Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day).
"Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed
by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair
market value of all Plan assets allocable to such liabilities under Title IV
of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA
Group to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the States
and the District of Columbia, but excluding its territories and possessions.
"Wholly-Owned Consolidated Subsidiary" means any Consolidated Subsidiary
all of the shares of capital stock or other ownership interests of which
(except directors' qualifying shares) are at the time directly or indirectly
owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time, applied
on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks; PROVIDED that, if the Borrower notifies the Agent that the
Borrower wishes to amend any covenant in Article V to eliminate the effect of
any change in generally accepted accounting principles on the operation of such
covenant (or if the Agent notifies the Borrower that the Required Banks wish to
amend Article V for such purpose), then the Borrower's compliance with such
covenant shall be determined on the basis of generally accepted accounting
principles in effect immediately before the relevant change in generally
accepted accounting
15
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Borrower and the Required
Banks.
SECTION 1.03. Types of Borrowings. The term "Borrowing" denotes the
aggregation of Loans of one or more Banks made or to be made to the Borrower
pursuant to Article II on a single date and for a single Interest Period.
Borrowings are classified for purposes of this Agreement either by reference
to the pricing of Loans comprising such Borrowing (E.G., a "Euro-Dollar
Borrowing" is a Borrowing comprised of Euro-Dollar Loans) or by reference to
the provisions of Article II under which participation therein is determined
(I.E., a "Committed Borrowing" is a Borrowing under Section 2.01 in which
all Banks participate in proportion to their Commitments, while a "Money
Market Borrowing" is a Borrowing under Section 2.03 in which the Bank
participants are determined on the basis of their bids in accordance
therewith).
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. Subject to the terms and conditions
set forth in this Agreement, each Bank severally agrees to make loans to the
Borrower from time to time during the Revolving Credit Period in an aggregate
principal amount at any time outstanding not to exceed the amount of such
Bank's Commitment. Each Borrowing under this Section 2.01 shall be in an
aggregate principal amount of $10,000,000 or any larger multiple of
$1,000,000 (except that any such Borrowing may be in an aggregate amount
equal to the amount available in accordance with Section 3.02(b)) and shall
be made from the several Banks ratably in proportion to their respective
Commitments. Within the foregoing limits, the Borrower may borrow under this
Section, repay, or to the extent permitted by Section 2.11, prepay loans and
reborrow under this Section at any time during the Revolving Credit Period.
SECTION 2.02. Notice of Committed Borrowings. The Borrower shall give
the Agent notice (a "Notice of Committed Borrowing") not later than 10:30
A.M. (New York City time) on (x) the date of each Base Rate Borrowing, (y)
the second Domestic Business Day before each CD Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(a) the date of such Borrowing, which shall be a Domestic Business Day
in the case of a Domestic Borrowing or a Euro-Dollar Business Day in the case
of a Euro-Dollar Borrowing,
16
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to be CD Loans, Base
Rate Loans or Euro-Dollar Loans, and
(d) in the case of a Committed Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the definition
of Interest Period.
SECTION 2.03. Money Market Borrowings.
(a) THE MONEY MARKET OPTION. In addition to Committed Borrowings pursuant
to Section 2.01, the Borrower may, as set forth in this Section, request the
Banks during the Revolving Credit Period to make offers to make Money Market
Loans to the Borrower. The Banks may, but shall have no obligation to, make
such offers and the Borrower may, but shall have no obligation to, accept any
such offers in the manner set forth in this Section.
(b) MONEY MARKET QUOTE REQUEST. When the Borrower wishes to request
offers to make Money Market Loans under this Section, it shall transmit to the
Agent by telex or facsimile transmission a Money Market Quote Request
substantially in the form of Exhibit B hereto so as to be received no later than
10:30 A.M. (New York City time) on (x) the fifth Euro-Dollar Business Day prior
to the date of Borrowing proposed therein, in the case of a LIBOR Auction or (y)
the Domestic Business Day next preceding the date of Borrowing proposed therein,
in the case of an Absolute Rate Auction (or, in either case, such other time or
date as the Borrower and the Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Euro-
Dollar Business Day in the case of a LIBOR Auction or a Domestic
Business Day in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$10,000,000 or a larger multiple of $1,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth
a Money Market Margin or a Money Market Absolute Rate.
17
The Borrower may request offers to make Money Market Loans for more than
one Interest Period in a single Money Market Quote Request. No Money Market
Quote Request shall be given within five Euro-Dollar Business Days (or such
other number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) INVITATION FOR MONEY MARKET QUOTES. Promptly upon receipt of a Money
Market Quote Request, the Agent shall send to the Banks by telex or facsimile
transmission an Invitation for Money Market Quotes substantially in the form of
Exhibit C hereto, which shall constitute an invitation by the Borrower to each
Bank to submit Money Market Quotes offering to make the Money Market Loans to
which such Money Market Quote Request relates in accordance with this Section.
(d) SUBMISSION AND CONTENTS OF MONEY MARKET QUOTES.
(i) Each Bank may submit a Money Market Quote containing an
offer or offers to make Money Market Loans in response to any
Invitation for Money Market Quotes. Each Money Market Quote must
comply with the requirements of this subsection (d) and must be
submitted to the Agent by telex or facsimile transmission at its
offices specified in or pursuant to Section 9.01 not later than (x)
2:00 P.M. (New York City time) on the fourth Euro-Dollar Business Day
prior to the proposed date of Borrowing, in the case of a LIBOR
Auction or (y) 9:30 A.M. (New York City time) on the proposed date of
Borrowing, in the case of an Absolute Rate Auction (or, in either
case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than
the date of the Money Market Quote Request for the first LIBOR Auction
or Absolute Rate Auction for which such change is to be effective);
PROVIDED that Money Market Quotes submitted by the Agent (or any
affiliate of the Agent) in the capacity of a Bank may be submitted,
and may only be submitted, if the Agent or such affiliate notifies the
Borrower of the terms of the offer or offers contained therein not
later than (x) 1:00 P.M. (New York City time) on the fourth
Euro-Dollar Business Day prior to the proposed date of Borrowing, in
the case of a LIBOR Auction or (y) 9:15 A.M. (New York City time) on
the proposed date of Borrowing, in the case of an Absolute Rate
Auction. Subject to Articles III and VI, any Money Market Quote so
made shall be irrevocable except with the written consent of the Agent
given on the instructions of the Borrower.
18
(ii) Each Money Market Quote shall be in substantially the form
of Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for which each such
offer is being made, which principal amount (w) may be greater than or
less than the Commitment of the quoting Bank, (x) must be $5,000,000
or a larger multiple of $1,000,000, (y) may not exceed the principal
amount of Money Market Loans for which offers were requested and (z)
may be subject to an aggregate limitation as to the principal amount
of Money Market Loans for which offers being made by such quoting Bank
may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable London Interbank Offered Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or
subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest per
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the
quoting Bank with respect to each Interest Period specified in the related
Invitation for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto or does
not specify all of the information required by subsection (d)(ii);
(B) contains qualifying, conditional or similar language (other than
the limitation set forth in clause (ii)(B)(z) above);
(C) proposes terms other than or in addition to those set forth in
the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
19
(e) NOTICE TO BORROWER. The Agent shall promptly notify the Borrower of
the terms (x) of any Money Market Quote submitted by a Bank that is in
accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest error in
such former Money Market Quote. The Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Money Market Loans for which
offers have been received for each Interest Period specified in the related
Money Market Quote Request, (B) the respective principal amounts and Money
Market Margins or Money Market Absolute Rates, as the case may be, so offered
and (C) if applicable, limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be accepted.
(f) ACCEPTANCE AND NOTICE BY BORROWER. Not later than 10:30 A.M. (New
York City time) on (x) the third Euro-Dollar Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or (y) the proposed date of
Borrowing, in the case of an Absolute Rate Auction (or, in either case, such
other time or date as the Borrower and the Agent shall have mutually agreed and
shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), the Borrower shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money
Market Quote in whole or in part; PROVIDED that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the
related Money Market Quote Request,
(ii) the principal amount of each Money Market Borrowing must be
$10,000,000 or a larger multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as the
case may be, and
20
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) ALLOCATION BY AGENT. If offers are made by two or more Banks with the
same Money Market Margins or Money Market Absolute Rates, as the case may be,
for a greater aggregate principal amount than the amount in respect of which
such offers are accepted for the related Interest Period, the principal amount
of Money Market Loans in respect of which such offers are accepted shall be
allocated by the Agent among such Banks as nearly as possible (in multiples of
$1,000,000, as the Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. NOTICE TO BANKS; FUNDING OF LOANS.
(a) Upon receipt of a Notice of Borrowing, the Agent shall promptly notify
each Bank of the contents thereof and of such Bank's share (if any) of such
Borrowing and such Notice of Borrowing shall not thereafter be revocable by the
Borrower.
(b) Not later than 12:00 Noon (New York City time) on the date of each
Borrowing, each Bank participating therein shall (except as provided in
subsection (c) of this Section) make available its share of such Borrowing, in
Federal or other funds immediately available in New York City, to the Agent at
its address referred to in Section 9.01. Unless the Agent determines that any
applicable condition specified in Article III has not been satisfied, the Agent
will make the funds so received from the Banks available to the Borrower at the
Agent's aforesaid address.
(c) If any Bank makes a new Loan hereunder on a day on which the Borrower
is to repay all or any part of an outstanding Loan from such Bank, such Bank
shall apply the proceeds of its new Loan to make such repayment and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount being repaid shall be made available by such Bank to the Agent as
provided in subsection (b), or remitted by the Borrower to the Agent as provided
in Section 2.12, as the case may be.
(d) Unless the Agent shall have received notice from a Bank prior to the
date of any Borrowing that such Bank will not make available to the Agent such
Bank's share of such Borrowing, the Agent may assume that such Bank has made
such share available to the Agent on the date of such Borrowing in accordance
with subsections (b) and (c) of this Section 2.04 and the Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
21
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Agent, such Bank and, if such Bank shall
fail to do so within one Domestic Business Day, the Borrower severally agree
to repay to the Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the Agent,
at the Federal Funds Rate. If such Bank shall repay to the Agent such
corresponding amount, such amount so repaid shall constitute such Bank's Loan
included in such Borrowing for purposes of this Agreement.
SECTION 2.05. NOTES. (a) The Loans of each Bank shall be evidenced by
a single Note payable to the order of such Bank for the account of its
Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the Agent, request
that its Loans of a particular type be evidenced by a separate Note in an
amount equal to the aggregate unpaid principal amount of such Loans. Each
such Note shall be in substantially the form of Exhibit A hereto with
appropriate modifications to reflect the fact that it evidences solely Loans
of the relevant type. Each reference in this Agreement to the "Note" of such
Bank shall be deemed to refer to and include any or all of such Notes, as the
context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.01(b), the
Agent shall forward such Note to such Bank. Each Bank shall record the date,
amount, type and maturity of each Loan made by it, and the date and amount of
each payment of principal made by the Borrower with respect thereto, and may,
if such Bank so elects in connection with any transfer or enforcement of its
Note, endorse on the schedule forming a part thereof appropriate notations to
evidence the foregoing information with respect to each such Loan then
outstanding; PROVIDED that the failure of any Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
under any Financing Document. Each Bank is hereby irrevocably authorized by
the Borrower so to endorse its Note and to attach to and make a part of its
Note a continuation of any such schedule as and when required.
SECTION 2.06. MATURITY OF LOANS. Each Loan included in any Borrowing
shall mature, and the principal amount thereof shall be due and payable, on
the last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. INTEREST RATES. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
Base
22
Rate for such day. Such interest shall be payable for each Interest Period
on the last day thereof. Any overdue principal of or interest on any Base
Rate Loan shall bear interest, payable on demand, for each day until paid at
a rate per annum equal to the sum of 2% plus the rate otherwise applicable to
Base Rate Loans for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during the Interest Period applicable thereto,
at a rate per annum equal to the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Interest Period; PROVIDED that if any CD
Loan shall, as a result of clause (2)(b) of the definition of Interest
Period, have an Interest Period of less than 30 days, such CD Loan shall bear
interest during such Interest Period at the rate applicable to Base Rate
Loans during such period. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than 90
days, at intervals of 90 days after the first day thereof. Any overdue
principal of or interest on any CD Loan shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the higher of (i) the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Loan and (ii) the rate applicable to Base
Rate Loans for such day.
"CD Margin" means a rate per annum determined in accordance with the
Pricing Schedule.
The "Adjusted CD Rate" applicable to any Interest Period means a rate
per annum determined pursuant to the following formula:
[ CDBR]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
----------
* The amount in brackets being rounded upward, if necessary, to the next
higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the rate of
interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum
bid at 10:00 A.M. (New York City time) (or as soon thereafter as practicable)
on the first day of such Interest Period by two or more New York certificate
of deposit dealers of
23
recognized standing for the purchase at face value from each CD Reference
Bank of its certificates of deposit in an amount comparable to the principal
amount of the CD Loan of such CD Reference Bank to which such Interest Period
applies and having a maturity comparable to such Interest Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars
in respect of new non-personal time deposits in dollars in New York City
having a maturity comparable to the related Interest Period and in an amount
of $100,000 or more. The Adjusted CD Rate shall be adjusted automatically on
and as of the effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in effect
on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or
a comparable successor assessment risk classification) within the meaning of
12 C.F.R. Section 327.4(a) (or any successor provision) to the Federal
Deposit Insurance Corporation (or any successor) for such Corporation's (or
such successor's) insuring time deposits at offices of such institution in
the United States. The Adjusted CD Rate shall be adjusted automatically on
and as of the effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for
such day plus the London Interbank Offered Rate applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the last
day thereof and, if such Interest Period is longer than three months, at
intervals of three months after the first day thereof.
"Euro-Dollar Margin" means a rate per annum determined in accordance
with the Pricing Schedule.
The "London Interbank Offered Rate" applicable to any Interest Period
means the average (rounded upward, if necessary, to the next higher 1/16 of
1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business
Days before the first day of such Interest Period in an amount approximately
equal to the
24
principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank
to which such Interest Period is to apply and for a period of time comparable
to such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan shall
bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the date of actual payment, at a
rate per annum equal to the sum of 2% plus the higher of (i) the sum of the
Euro-Dollar Margin for such day plus the London Interbank Offered Rate
applicable to such Loan and (ii) the Euro-Dollar Margin for such day plus the
quotient obtained (rounded upward, if necessary, to the next higher 1/100 of
1%) by dividing (x) the average (rounded upward, if necessary, to the next
higher 1/16 of 1%) of the respective rates per annum at which one day (or, if
such amount due remains unpaid more than three Euro-Dollar Business Days,
then for such other period of time not longer than three months as the Agent
may select) deposits in dollars in an amount approximately equal to such
overdue payment due to each of the Euro-Dollar Reference Banks are offered to
such Euro-Dollar Reference Bank in the London interbank market for the
applicable period determined as provided above by (y) 1.00 minus the
Euro-Dollar Reserve Percentage (or, if the circumstances described in clause
(a) or (b) of Section 8.01 shall exist, at a rate per annum equal to the sum
of 2% plus the rate applicable to Base Rate Loans for such day).
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan shall bear
interest on the outstanding principal amount thereof, for the Interest Period
applicable thereto, at a rate per annum equal to the sum of the London
Interbank Offered Rate for such Interest Period (determined in accordance
with Section 2.07(c) as if the related Money Market LIBOR Borrowing were a
Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted by the
Bank making such Loan in accordance with Section 2.03. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum
equal to the Money Market Absolute Rate quoted by the Bank making such Loan
in accordance with Section 2.03. Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is
longer than three months, at intervals of three months after the first day
thereof. Any overdue principal of or interest on any Money Market Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the Base Rate for such day.
(f) The Agent shall determine each interest rate applicable to the
Loans hereunder. The Agent shall give prompt notice to the Borrower and the
25
participating Banks of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(g) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Agent as contemplated by this Section. If any Reference
Bank does not furnish a timely quotation, the Agent shall determine the
relevant interest rate on the basis of the quotation or quotations furnished
by the remaining Reference Bank or Banks or, if none of such quotations is
available on a timely basis, the provisions of Section 8.01 shall apply.
SECTION 2.08. FACILITY FEE. The Borrower shall pay to the Agent for
the account of the Banks ratably in proportion to their Commitments a
facility fee at the Facility Fee Rate determined daily in accordance with the
Pricing Schedule. Such facility fee shall accrue (i) from and including the
Effective Date to but excluding the Termination Date (or earlier date of
termination of the Commitments in their entirety), on the daily aggregate
amount of the Commitments (whether used or unused) and (ii) from and
including the Termination Date or earlier date of termination to but
excluding the date the Loans shall be repaid in their entirety, on the daily
aggregate outstanding principal amount of the Loans. Accrued fees under this
Section shall be payable quarterly in arrears on the last Euro-Dollar
Business Day of each March, June, September and December, and upon the date
of termination of the Commitments in their entirety (and, if later, the date
the Loans shall be repaid in their entirety).
SECTION 2.09. OPTIONAL TERMINATION OR REDUCTION OF COMMITMENTS. The
Borrower may, upon at least three Domestic Business Days' notice to the Agent
(which shall promptly notify the Banks), (i) terminate the Commitments at any
time, if no Loans are outstanding at such time or (ii) ratably reduce from
time to time by an aggregate amount of $10,000,000 or any larger multiple
thereof, the aggregate amount of the Commitments in excess of the aggregate
outstanding principal amount of the Loans.
SECTION 2.10. SCHEDULED TERMINATION OF COMMITMENTS. The Commitments
shall terminate on the Termination Date and any Loans then outstanding
(together with accrued interest thereon) shall be due and payable on such
date.
SECTION 2.11. OPTIONAL PREPAYMENTS. (a) The Borrower may (i) upon at
least one Domestic Business Day's notice to the Agent, prepay any Base Rate
Borrowing (or any Money Market Borrowing bearing interest at the Base Rate
pursuant to Section 8.01(a)), (ii) upon at least three Domestic Business
Days' notice to the Agent, subject to Section 2.13, prepay any CD Borrowing
and (iii) upon at least three Euro-Dollar Business Days' notice to the Agent,
subject to
26
Section 2.13, prepay any Euro-Dollar Borrowing, in whole at any time, or from
time to time in part in amounts aggregating $10,000,000 or any larger
multiple of $1,000,000, by paying the principal amount to be prepaid together
with accrued interest thereon to the date of prepayment. Each such
prepayment shall be applied to prepay ratably the Loans of the several Banks
included in such Borrowing.
(b) Except as provided in Section 2.11(a), the Borrower may not prepay
all or any portion of the principal amount of any Money Market Loan prior to
the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this Section,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share (if any) of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.12. GENERAL PROVISIONS AS TO PAYMENTS. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of
fees hereunder, not later than 12:00 Noon (New York City time) on the date
when due, in Federal or other funds immediately available in New York City,
to the Agent at its address referred to in Section 9.01. The Agent will
promptly distribute to each Bank its ratable share of each such payment
received by the Agent for the account of the Banks. Whenever any payment of
principal of, or interest on, the Domestic Loans or of fees shall be due on a
day which is not a Domestic Business Day, the date for payment thereof shall
be extended to the next succeeding Domestic Business Day. Whenever any
payment of principal of, or interest on, the Euro-Dollar Loans shall be due
on a day which is not a Euro-Dollar Business Day, the date for payment
thereof shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in
which case the date for payment thereof shall be the next preceding
Euro-Dollar Business Day. Whenever any payment of principal of, or interest
on, the Money Market Loans shall be due on a day which is not a Euro-Dollar
Business Day, the date for payment thereof shall be extended to the next
succeeding Euro-Dollar Business Day. If the date for any payment of
principal is extended by operation of law or otherwise, interest thereon
shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the Borrower prior
to the date on which any payment is due to the Banks hereunder that the
Borrower will not make such payment in full, the Agent may assume that the
Borrower has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Bank on such due date an amount equal to the amount then due such Bank. If
and to the extent that the Borrower shall not have so made such payment, each
Bank shall repay to the
27
Agent forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is distributed to
such Bank until the date such Bank repays such amount to the Agent, at the
Federal Funds Rate.
SECTION 2.13. FUNDING LOSSES. If the Borrower makes any payment of
principal with respect to any Fixed Rate Loan (pursuant to Article II, VI or
VIII or otherwise) on any day other than the last day of the Interest Period
applicable thereto, or the last day of an applicable period fixed pursuant to
Section 2.07(d), or if the Borrower fails to borrow or prepay any Fixed Rate
Loans after notice has been given to any Bank in accordance with Section
2.04(a) or 2.11(c), the Borrower shall reimburse each Bank within 15 days
after demand for any resulting loss or expense incurred by it (or by an
existing or prospective Participant in the related Loan), including (without
limitation) any loss incurred in obtaining, liquidating or employing deposits
from third parties, but excluding loss of margin for the period after any
such payment or failure to borrow or prepay, PROVIDED that such Bank shall
have delivered to the Borrower a certificate as to the amount of such loss or
expense, setting forth the basis of calculation thereof, which certificate
shall be conclusive in the absence of manifest error.
SECTION 2.14. COMPUTATION OF INTEREST AND FEES. Interest based on the
Prime Rate hereunder shall be computed on the basis of a year of 365 days (or
366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
facility fees shall be computed on the basis of a year of 360 days and paid
for the actual number of days elapsed (including the first day but excluding
the last day).
SECTION 2.15. REGULATION D COMPENSATION. For so long as any Bank
maintains reserves against "Eurocurrency liabilities" (or any other category
of liabilities which includes deposits by reference to which the interest
rate on Euro-Dollar Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-United States office of
such Bank to United States residents), and as a result the cost to such Bank
(or its Euro-Dollar Lending Office) of making or maintaining its Euro-Dollar
Loans is increased, then such Bank may require the Borrower to pay,
contemporaneously (or at such other time or times as the Borrower and such
Bank may mutually agree) with each payment of interest on the Euro-Dollar
Loans, additional interest on the related Euro-Dollar Loan of such Bank at a
rate per annum up to but not exceeding the excess of (i) (A) the applicable
London Interbank Offered Rate divided by (B) one MINUS the Euro-Dollar
Reserve Percentage over (ii) the applicable London Interbank Offered Rate.
Any Bank wishing to require payment of such additional interest (x) shall so
notify the Borrower and the Agent, in which case such additional interest on
the Euro-Dollar Loans of such Bank shall be payable to such Bank at the place
28
indicated in such notice with respect to each Interest Period commencing at
least three Euro-Dollar Business Days after the giving of such notice and (y)
shall furnish to the Borrower at least five Euro-Dollar Business Days prior
to each date on which interest is payable on the Euro-Dollar Loans (or at
such other time or times as the Borrower and such Bank may mutually agree) an
officer's certificate setting forth the amount to which such Bank is then
entitled under this Section (which shall be consistent with such Bank's good
faith estimate of the level at which the related reserves are maintained by
it). Each such certificate shall be accompanied by such information as the
Borrower may reasonably request as to the computation set forth therein.
ARTICLE III
CONDITIONS
SECTION 3.01. EFFECTIVENESS. The Commitments shall become effective on
the date that each of the following conditions shall have been satisfied (or
waived in accordance with Section 9.05):
(a) receipt by the Agent of counterparts hereof signed by each of the
parties hereto (or, in the case of any party as to which an executed
counterpart shall not have been received, receipt by the Agent in form
satisfactory to it of telegraphic, telex or other written confirmation from
such party of execution of a counterpart hereof by such party);
(b) receipt by the Agent for the account of each Bank of a duly
executed Note dated on or before the Effective Date complying with the
provisions of Section 2.05;
(c) receipt by the Agent of an opinion of the principal legal officer
of the Borrower, substantially in the form of Exhibit E hereto and covering
such additional matters relating to the transactions contemplated hereby as
the Required Banks may reasonably request;
(d) receipt by the Agent of an opinion of Davis Polk & Wardwell,
special counsel for the Agent, substantially in the form of Exhibit F hereto
and covering such additional matters relating to the transactions
contemplated hereby as the Required Banks may reasonably request;
(e) receipt by the Agent of evidence satisfactory to it of the payment
of fees as heretofore mutually agreed; and
29
(f) receipt by the Agent of all documents it may reasonably request
relating to the existence of the Borrower, the corporate authority for and
the validity of the Financing Documents, and any other matters relevant
hereto, all in form and substance satisfactory to the Agent;
PROVIDED that the Commitments shall not become effective unless all of the
foregoing conditions are satisfied not later than January 31, 1999. The
Agent shall promptly notify the Borrower and each Bank of the Effective Date,
and such notice shall be conclusive and binding on all parties hereto.
SECTION 3.02. BORROWINGS. The obligation of any Bank to make a Loan on
the occasion of any Borrowing is subject to the satisfaction of the following
conditions:
(a) receipt by the Agent of a Notice of Borrowing as required by
Section 2.02 or 2.03, as the case may be;
(b) the fact that, immediately after such Borrowing, the aggregate
outstanding principal amount of the Loans will not exceed the aggregate
amount of the Commitments;
(c) the fact that, immediately before and after such Borrowing, no
Default shall have occurred and be continuing; and
(d) the fact that the representations and warranties of the Borrower
contained in the Financing Documents (except (x) in the case of a Refunding
Borrowing and (y) in the case of any other Borrowing, solely if on the date
of such Borrowing, the Borrower's senior unsecured long-term debt is rated,
without third-party credit enhancement, A- or higher by S&P and A3 or higher
by Moody's, the representations and warranties set forth in Section 4.04(c)
as to any matter which has theretofore been disclosed in writing by the
Borrower to the Banks) shall be true on and as of the date of such Borrowing.
Each Borrowing hereunder shall be deemed to be a representation and warranty
by the Borrower on the date of such Borrowing as to the facts specified in
clauses (b), (c) and (d) of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
30
SECTION 4.01. CORPORATE EXISTENCE AND POWER. The Borrower is a
corporation duly incorporated, validly existing and in good standing under
the laws of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted.
SECTION 4.02. CORPORATE AND GOVERNMENTAL AUTHORIZATION; NO
CONTRAVENTION. The execution, delivery and performance by the Borrower of the
Financing Documents are within its corporate powers, have been duly
authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do
not contravene, or constitute a default under, any provision of applicable
law or regulation or of its certificate of incorporation or by-laws or of any
agreement, judgment, injunction, order, decree or other instrument binding
upon the Borrower or any of its Subsidiaries or result in the creation or
imposition of any Lien on any asset of the Borrower or any of its
Subsidiaries.
SECTION 4.03. BINDING EFFECT. This Agreement constitutes a valid and
binding agreement of the Borrower and the Notes, when executed and delivered
in accordance with this Agreement, will constitute valid and binding
obligations of the Borrower, in each case enforceable against the Borrower in
accordance with its terms.
SECTION 4.04. FINANCIAL INFORMATION.
(a) The consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of December 31, 1997 and the related consolidated statements
of operations and cash flows for the fiscal year then ended, reported on by
Deloitte & Touche LLP and set forth in the Borrower's 1997 Form 10-K, a copy
of which has been delivered to each of the Banks, fairly present, in
conformity with generally accepted accounting principles, the consolidated
financial position of the Borrower and its Consolidated Subsidiaries as of
such date and their consolidated results of operations and cash flows for
such fiscal year.
(b) The unaudited consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of September 30, 1998 and the related unaudited
consolidated statements of operations and cash flows for the nine months then
ended, set forth in the Borrower's Latest Form 10-Q, a copy of which has been
delivered to each of the Banks, fairly present, in conformity with generally
accepted accounting principles, the consolidated financial position of the
Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such nine month period
(subject to normal year-end adjustments).
31
(c) Since September 30, 1998 there has been no material adverse change in
the business, financial position, results of operations or prospects of the
Borrower.
SECTION 4.05. LITIGATION.
(a) There is no action, suit or proceeding pending against, or to the
knowledge of the Borrower threatened against or affecting, the Borrower or any
of its Subsidiaries before any court or arbitrator or any governmental body,
agency or official which could reasonably be expected to materially and
adversely affect the business, consolidated financial position or consolidated
results of operations of the Borrower and its Consolidated Subsidiaries taken as
a whole.
(b) There is no action, suit or proceeding pending against, or to the
knowledge of the Borrower threatened against or affecting, the Borrower or any
of its Subsidiaries before any court or arbitrator or any governmental body,
agency or official which in any manner questions the validity or enforceability
of any Financing Document.
SECTION 4.06. COMPLIANCE WITH ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (iii)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.
SECTION 4.07. ENVIRONMENTAL MATTERS. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of Environmental
Laws on the business, operations and properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including, without limitation, any capital or operating
expenditures required for clean-up or closure of properties presently or
previously owned, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or as
a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or
32
reduction in the level of or change in the nature of operations conducted
thereat, any costs or liabilities in connection with off-site disposal of
wastes or Hazardous Substances, and any actual or potential liabilities to
third parties, including employees, and any related costs and expenses). On
the basis of this review, and based upon conditions of which the Borrower has
knowledge and upon its estimates of the costs of compliance with and/or
remediation mandated by Environmental Laws, the Borrower has reasonably
concluded that Environmental Laws are unlikely to have a material adverse
effect on the business, financial condition, results of operations or
prospects of the Borrower and its Consolidated Subsidiaries, considered as a
whole.
SECTION 4.08. TAXES. All United States federal income tax returns and all
other material tax returns which are required to be filed by or in respect of
the Borrower or any Subsidiary have been filed by the Borrower or a Subsidiary
thereof, and all taxes due pursuant to such returns or pursuant to any
assessment received in respect thereof have been paid.
SECTION 4.09. MATERIAL SUBSIDIARIES. Each of the Borrower's Material
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
SECTION 4.10. NOT AN INVESTMENT COMPANY. The Borrower is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
SECTION 4.11. USE OF PROCEEDS. The proceeds of the loans under this
Agreement will be used by the Borrower for general corporate purposes, including
acquisitions and stock repurchases. None of such proceeds will be used in
violation of Regulation T, U or X of the Board of Governors of the Federal
Reserve System.
SECTION 4.12. FULL DISCLOSURE. All information heretofore furnished by
the Borrower to the Agent or any Bank for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all such information
hereafter furnished by the Borrower to the Agent or any Bank will be, true and
accurate in all material respects on the date as of which such information is
stated or certified. The Borrower has disclosed to the Banks in writing any and
all facts which materially and adversely affect or may affect (to the extent the
Borrower can now reasonably foresee), the business, operations or financial
condition of the Borrower and its Consolidated Subsidiaries, taken as a whole,
or the ability of the
33
Borrower to perform its obligations under this Agreement or any other
Financing Document.
SECTION 4.13. YEAR 2000 COMPLIANCE. The Borrower has (i) initiated a
review and assessment of all areas within the business and operations of the
Borrower and each of its Subsidiaries (including those areas affected by
suppliers and vendors) that could be adversely affected by the "YEAR 2000
PROBLEM" (that is, the risk that computer applications used by it or any of its
Subsidiaries (or their respective suppliers and vendors) may be unable to
recognize and perform properly date-sensitive functions involving certain dates
prior to and any date after December 31, 1999), (ii) developed a plan and
timeline for addressing the Year 2000 Problem on a timely basis and (iii) to
date, implemented such plan in accordance with such timetable. The Borrower
reasonably believes that all computer applications (including those of suppliers
and vendors) that are material to the business or operations of the Borrower or
any of its Subsidiaries will on a timely basis be able to perform properly date-
sensitive functions for all dates before and from and after January 1, 2000
(that is, be "YEAR 2000 COMPLIANT"), except to the extent that a failure to do
so could not reasonably be expected to have a Material Adverse Effect.
ARTICLE V
COVENANTS
The Borrower agrees that, from and after the Effective Date for so long as
any Bank has any Commitment hereunder or any amount payable under any Note
remains unpaid:
SECTION 5.01. INFORMATION. The Borrower will deliver to each of the
Banks:
(a) as soon as available and in any event within 120 days after the end of
each fiscal year of the Borrower, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such fiscal year and the
related consolidated financial statements in the form then required to be filed
with the Securities and Exchange Commission on Form 10-K or its then equivalent,
all reported on by independent public accountants of nationally recognized
standing;
(b) as soon as available and in any event within 60 days after the end of
each of the first three quarters of each fiscal year of the Borrower, a
consolidated
34
balance sheet of the Borrower and its Consolidated Subsidiaries as of the end
of such quarter and the related consolidated financial statements in the form
then required to be filed with the Securities and Exchange Commission on Form
10-Q or its then equivalent, all certified (subject to normal year-end audit
adjustments) by the chief financial officer or the chief accounting officer
of the Borrower;
(c) simultaneously with the delivery of each set of financial statements
referred to in clauses (a) and (b) above, a certificate of the chief financial
officer or the chief accounting officer of the Borrower (i) setting forth in
reasonable detail the calculations required to establish whether the Borrower
was in compliance with the requirements of Sections 5.05 to 5.07, inclusive, on
the date of such financial statements and (ii) stating whether any Default
exists on the date of such certificate and, if any Default then exists, setting
forth the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of financial statements
referred to in clause (a) above, a statement of the firm of independent public
accountants which reported on such statements whether anything has come to their
attention to cause them to believe that any Default existed on the date of such
statements;
(e) within five days after any officer of the Borrower obtains knowledge
of any Default, if such Default is then continuing, a certificate of the chief
financial officer or the chief accounting officer of the Borrower setting forth
the details thereof and the action which the Borrower is taking or proposes to
take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the Borrower
generally, copies of all financial statements, reports and proxy statements so
mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements on
Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their
equivalents) which the Borrower shall have filed with the Securities and
Exchange Commission;
(h) if and when any member of the ERISA Group (i) gives or is required to
give notice to the PBGC of any "reportable event" (as defined in Section 4043 of
ERISA) with respect to any Material Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Material Plan has given or is required to give notice of
any such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
35
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer, any Material Plan, a
copy of such notice; (iv) applies for a waiver of the minimum funding standard
under Section 412 of the Internal Revenue Code, a copy of such application; (v)
gives notice of intent to terminate any Material Plan under Section 4041(c) of
ERISA, a copy of such notice and other information filed with the PBGC; (vi)
gives notice of withdrawal from any Material Plan pursuant to Section 4063 of
ERISA, a copy of such notice; or (vii) fails to make any payment or contribution
to any Material Plan or Multiemployer Plan or in respect of any Benefit
Arrangement or makes any amendment to any Material Plan or Benefit Arrangement
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security, a certificate of the chief financial officer or the
chief accounting officer of the Borrower setting forth details as to such
occurrence and action, if any, which the Borrower or applicable member of the
ERISA Group is required or proposes to take;
(i) forthwith, notice of any change of which the Borrower becomes aware in
the rating by any Rating Agency of the Borrower's long-term debt; and
(j) from time to time such additional information regarding the financial
position or business of the Borrower and its Subsidiaries as the Agent, at the
request of any Bank, may reasonably request.
SECTION 5.02. MAINTENANCE OF PROPERTY; INSURANCE.
(a) The Borrower will keep, and will cause each Subsidiary to keep, all
property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted.
(b) The Borrower will, and will cause each of its Subsidiaries to,
maintain (either in the name of the Borrower or in such Subsidiary's own name)
with financially sound and responsible insurance companies, insurance on all
their respective properties in at least such amounts and against at least such
risks (and with such risk retention) as are usually insured against in the same
general area by companies of established repute engaged in the same or a similar
business; and will furnish to the Banks, upon request from the Agent,
information presented in reasonable detail as to the insurance so carried.
SECTION 5.03. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. The
Borrower will continue, and will cause each Material Subsidiary to continue, to
engage in business of the same general type as now conducted by the Borrower and
its Subsidiaries, and will preserve, renew and keep in full force and effect,
and
36
will cause each Material Subsidiary to preserve, renew and keep in full
force and effect their respective existence and their respective rights,
privileges and franchises necessary or desirable in the normal conduct of
business; PROVIDED that nothing in this Section 5.03 shall prohibit (i) the
merger of a Subsidiary into the Borrower or the merger or consolidation of a
Subsidiary with or into another Person if the corporation surviving such
consolidation or merger is a Subsidiary and if, in each case, after giving
effect thereto, no Default shall have occurred and be continuing or (ii) the
termination of the existence of any Subsidiary if the Borrower in good faith
determines that such termination is in the best interest of the Borrower and is
not materially disadvantageous to the Banks.
SECTION 5.04. COMPLIANCE WITH LAWS. The Borrower will comply, and cause
each Subsidiary to comply, in all material respects with all applicable laws,
ordinances, rules, regulations, and requirements of governmental authorities
(including, without limitation, Environmental Laws and ERISA and the rules and
regulations thereunder) except where the necessity of compliance therewith is
contested in good faith by appropriate proceedings.
SECTION 5.05. LEVERAGE RATIO. The Leverage Ratio will at no time exceed
3.5 to 1.0.
SECTION 5.06. MAINTENANCE OF CERTAIN OPERATIONS. The Borrower will at all
times maintain direct or indirect ownership of 80% of the Equity Securities of
Intermec Technologies Corporation and UNOVA Industrial Automation Systems, Inc.
SECTION 5.07. LIMITATION ON SUBSIDIARY DEBT. The aggregate outstanding
principal amount of Debt of the Subsidiaries of the Borrower (exclusive of (i)
Debt owing to the Borrower or another Subsidiary and (ii) Foreign Debt) shall at
no time exceed 15% of Consolidated Net Assets.
SECTION 5.08. NEGATIVE PLEDGE. The Borrower will not, and will not permit
any Consolidated Subsidiary to, create, assume or suffer to exist any Lien
securing Debt or Derivatives Obligations on any asset now owned or hereafter
acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt outstanding
on the date of this Agreement in an aggregate principal amount not exceeding
$20,000,000;
(b) any Lien existing on the assets of any Person at the time such Person
becomes a Consolidated Subsidiary;
37
(c) any Lien on any asset securing Debt incurred or assumed for the
purpose of financing all or any part of the purchase price or cost of
construction of such asset, PROVIDED that such Lien attaches to such asset
within 270 days after the acquisition or completion of construction and
commencement of full operations thereof;
(d) any Lien on any asset of any Person existing at the time such
Person is acquired by, merged into or consolidated with the Borrower or a
Consolidated Subsidiary;
(e) any Lien existing on any asset prior to the acquisition thereof by
the Borrower or a Consolidated Subsidiary and not created in contemplation of
such acquisition;
(f) any Lien arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by any of the foregoing
clauses of this Section, PROVIDED that such Debt is not increased and is not
secured by any additional assets;
(g) Liens on cash and cash equivalents securing Derivatives
Obligations, provided that the aggregate amount of cash and cash equivalents
subject to such Liens may at no time exceed $20,000,000; and
(h) Liens not otherwise permitted by the foregoing clauses of this
Section securing Debt in an aggregate principal or face amount at any time
outstanding not exceeding 10% of Consolidated Net Worth.
SECTION 5.09. CONSOLIDATIONS, MERGERS AND SALES OF ASSETS. The
Borrower will not (i) consolidate or merge with or into any other Person or
(ii) sell, lease or otherwise transfer, directly or indirectly, all or any
substantial part of the assets of the Borrower and its Subsidiaries, taken as
a whole, to any other Person; PROVIDED that the Borrower may merge with
another Person if the Borrower is the surviving corporation and, after giving
effect thereto, no Default exists.
ARTICLE VI
DEFAULTS
SECTION 6.01. EVENTS OF DEFAULT. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
38
(a) the Borrower (i) shall fail to pay when due any principal of any
Loan or (ii) shall fail to pay any interest on any Loan, any fees or any
other amount payable hereunder within five days after the due date thereof;
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.05 through 5.09, inclusive;
(c) the Borrower shall fail to observe or perform any covenant or
agreement contained in any Financing Document (other than those covered by
clause (a) or (b) above) for 30 days after notice thereof has been given to
the Borrower by the Agent at the request of any Bank;
(d) any representation, warranty, certification or statement made (or
deemed made) by the Borrower in any Financing Document or in any
certificate, financial statement or other document delivered pursuant to any
Financing Document shall prove to have been incorrect in any material respect
when made (or deemed made) or delivered;
(e) the Borrower or any Subsidiary shall fail to make any payment in
respect of any Material Financial Obligations when due or within any
applicable grace period;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables (with the giving
of appropriate notice if required) the holder of such Debt or any Person
acting on such holder's behalf to accelerate the maturity thereof;
(g) the Borrower or any Material Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, or shall consent to any such relief or
to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against it, or shall make a
general assignment for the benefit of creditors, or shall fail generally to
pay its debts as they become due, or shall take any corporate action to
authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced against
the Borrower or any Material Subsidiary seeking liquidation, reorganization
or other relief with respect to it or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such involuntary
case or other proceeding
39
shall remain undismissed and unstayed for a period of 60 days; or an order
for relief shall be entered against the Borrower or any Material Subsidiary
under the federal bankruptcy laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an amount
or amounts aggregating in excess of $25,000,000 which it shall have become
liable to pay under Title IV of ERISA; or notice of intent to terminate a
Material Plan shall be filed under Title IV of ERISA by any member of the
ERISA Group, any plan administrator or any combination of the foregoing; or
the PBGC shall institute proceedings under Title IV of ERISA to terminate, to
impose liability (other than for premiums under Section 4007 of ERISA) in
respect of, or to cause a trustee to be appointed to administer, any Material
Plan; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any Material Plan must be
terminated; or there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to,
one or more Multiemployer Plans which could cause one or more members of the
ERISA Group to incur a current payment obligation in excess of $10,000,000;
(j) a judgment or order for the payment of money in excess of
$25,000,000 shall be rendered against the Borrower or any Material Subsidiary
and such judgment or order shall continue unsatisfied and unstayed for a
period of 30 days; or
(k) a Change of Control shall occur;
then, and in every such event, the Agent shall (i) if requested by Banks
having more than 50% in aggregate amount of the Commitments, by notice to the
Borrower terminate the Commitments and they shall thereupon terminate, and
(ii) if requested by Banks holding Notes evidencing more than 50% in
aggregate principal amount of the Loans, by notice to the Borrower declare
the Notes (together with accrued interest thereon) to be, and the Notes
(together with accrued interest thereon) shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower; PROVIDED that in the
case of any of the Events of Default specified in clause (g) or (h) above
with respect to the Borrower, without any notice to the Borrower or any
other act by the Agent or any Bank, the Commitments shall thereupon terminate
and the Notes (together with accrued interest thereon) shall become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.
40
SECTION 6.02. NOTICE OF DEFAULT. The Agent shall give notice to the
Borrower under Section 6.01(c) promptly upon being requested to do so by any
Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. APPOINTMENT AND AUTHORIZATION. Each Bank irrevocably
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under the Financing Documents as are delegated to
the Agent by the terms thereof, together with all such powers as are
reasonably incidental thereto.
SECTION 7.02. AGENT AND AFFILIATES. Morgan Guaranty Trust Company of
New York shall have the same rights and powers under the Financing Documents
as any other Bank and may exercise or refrain from exercising the same as
though it were not the Agent, and Morgan Guaranty Trust Company of New York
and its affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrower or any Subsidiary or
Affiliate of the Borrower as if it were not the Agent hereunder.
SECTION 7.03. ACTION BY AGENT. The obligations of the Agent hereunder
are only those expressly set forth in the Financing Documents. Without
limiting the generality of the foregoing, the Agent shall not be required to
take any action with respect to any Default, except as expressly provided in
Article VI.
SECTION 7.04. CONSULTATION WITH EXPERTS. The Agent may consult with
legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.
SECTION 7.05. LIABILITY OF AGENT. Neither the Agent nor any of its
affiliates nor any of the directors, officers, agents or employees of the
foregoing shall be liable for any action taken or not taken by it or them in
connection herewith (i) with the consent or at the request of the Required Banks
or (ii) in the absence of its or their own gross negligence or willful
misconduct. Neither the Agent nor any of its affiliates nor any of the
directors, officers, agents or employees of the foregoing shall be responsible
for or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with this Agreement or any
borrowing hereunder; (ii) the performance
41
or observance of any of the covenants or agreements of the Borrower; (iii)
the satisfaction of any condition specified in Article III, except receipt of
items required to be delivered to the Agent; or (iv) the validity,
effectiveness or genuineness of the Financing Documents or any other
instrument or writing furnished in connection herewith. The Agent shall not
incur any liability by acting in reliance upon any notice, consent,
certificate, statement, or other writing (which may be a bank wire, telex or
similar writing) believed by it to be genuine or to be signed by the proper
party or parties. Without limiting the generality of the foregoing, the use
of the term "agent" in this Agreement with reference to the Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable law. Instead, such term is
used merely as a matter of market custom and is intended to create or reflect
only an administrative relationship between independent contracting parties.
SECTION 7.06. INDEMNIFICATION. Each Bank shall, ratably in accordance
with its Commitment, indemnify the Agent, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by
the Borrower) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that
such indemnitees may suffer or incur in connection with the Financing
Documents or any action taken or omitted by such indemnitees thereunder.
SECTION 7.07. CREDIT DECISION. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Bank
also acknowledges that it will, independently and without reliance upon the
Agent or any other Bank, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking any action under this Agreement.
SECTION 7.08. SUCCESSOR AGENT. The Agent may resign at any time by giving
notice thereof to the Banks and the Borrower. Upon any such resignation, the
Required Banks shall have the right to appoint a successor Agent, subject to the
approval of the Borrower. If no successor Agent shall have been so appointed by
the Required Banks, with the approval of the Borrower, and shall have accepted
such appointment, within 30 days after the retiring Agent gives notice of
resignation, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be a Bank, if any Bank is willing to accept such
appointment, and in any event shall be a commercial bank organized or licensed
under the laws of the United States of America or of any State thereof and
having
42
a combined capital and surplus of at least $50,000,000. Upon the acceptance
of its appointment as Agent hereunder by a successor Agent, such successor
Agent shall thereupon succeed to and become vested with all the rights and
duties of the retiring Agent, and the retiring Agent shall be discharged from
its duties and obligations hereunder. After any retiring Agent's resignation
hereunder as Agent, the provisions of this Article shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent.
SECTION 7.09. AGENT'S FEES. The Borrower shall pay to the Agent for
its own account fees in the amounts and at the times previously agreed upon
between the Borrower and the Agent.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR UNFAIR.
If on or prior to the first day of any Interest Period for any Fixed Rate
Borrowing:
(a) the Agent is advised by the Reference Banks that deposits in
dollars (in the applicable amounts) are not being offered to the Reference
Banks in the relevant market for such Interest Period, or
(b) in the case of a Committed Borrowing, Banks having 50% or more of
the aggregate amount of the Commitments advise the Agent that the Adjusted CD
Rate or the London Interbank Offered Rate, as the case may be, as determined
by the Agent will not adequately and fairly reflect the cost to such Banks of
funding their CD Loans or Euro-Dollar Loans, as the case may be, for such
Interest Period, the Agent shall forthwith give notice thereof to the
Borrower and the Banks, whereupon until the Agent notifies the Borrower that
the circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make CD Loans or Euro-Dollar Loans, as the case
may be, shall be suspended. Unless the Borrower notifies the Agent at least
two Domestic Business Days before the date of any Fixed Rate Borrowing for
which a Notice of Borrowing has previously been given that it elects not to
borrow on such date, (i) if such Fixed Rate Borrowing is a Committed
Borrowing, such Borrowing shall instead be made as a Base Rate Borrowing and
(ii) if such Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the
Money Market LIBOR Loans comprising such Borrowing shall bear interest for
each day from and including the first day to but excluding the last day of
the Interest Period applicable thereto at the Base Rate for such day.
43
SECTION 8.02. ILLEGALITY. If, on or after the date of this Agreement,
the adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof,
or compliance by any Bank (or its Euro-Dollar Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall make it unlawful or
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain
or fund its Euro-Dollar Loans and such Bank shall so notify the Agent, the
Agent shall forthwith give notice thereof to the other Banks and the
Borrower, whereupon until such Bank notifies the Borrower and the Agent that
the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended. Before
giving any notice to the Agent pursuant to this Section 8.02, such Bank shall
designate a different Euro-Dollar Lending Office if such designation will
avoid the need for giving such notice and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. If such Bank shall
determine that it may not lawfully continue to maintain and fund any of its
outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each such Euro-Dollar Loan, together with accrued
interest thereon. Concurrently with prepaying each such Euro-Dollar Loan,
the Borrower shall borrow a Base Rate Loan in an equal principal amount from
such Bank (on which interest and principal shall be payable contemporaneously
with the related Euro-Dollar Loans of the other Banks), and such Bank shall
make such a Base Rate Loan.
SECTION 8.03. INCREASED COST AND REDUCED RETURN. (a) If on or after (x)
the date hereof, in the case of any Committed Loan or any obligation to make
Committed Loans or (y) the date of the related Money Market Quote, in the case
of any Money Market Loan, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency shall
impose, modify or deem applicable any reserve (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding (i) with respect to any CD Loan any such requirement
included in an applicable Domestic Reserve Percentage and (ii) with respect to
any Euro-Dollar Loan any
44
such requirement with respect to which such Bank is entitled to compensation
during the relevant Interest Period under Section 2.15), special deposit,
insurance assessment (excluding, with respect to any CD Loan, any such
requirement reflected in an applicable Assessment Rate) or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Applicable Lending Office) or shall impose on
any Bank (or its Applicable Lending Office) or on the United States market
for certificates of deposit or the London interbank market any other
condition affecting its Fixed Rate Loans, its Note or its obligation to make
Fixed Rate Loans and the result of any of the foregoing is to increase the
cost to such Bank (or is Applicable Lending Office) of making or maintaining
any Fixed Rate Loan, or to reduce the amount of any sum received or
receivable by such Bank (or its Applicable Lending Office) under this
Agreement or under its Note with respect thereto, by an amount deemed by such
Bank to be material, then, within 15 days after demand by such Bank (with a
copy to the Agent), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such increased cost or
reduction.
(b) If any Bank shall have determined that, after the date hereof, the
adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency (including any determination by any such
authority, central bank or comparable agency that, for purposes of capital
adequacy requirements, the Commitments hereunder do not constitute
commitments with an original maturity of one year or less), has or would have
the effect of reducing the rate of return on capital of such Bank (or its
Parent) as a consequence of such Bank's obligations hereunder to a level
below that which such Bank (or its Parent) could have achieved but for such
adoption, change, request or directive (taking into consideration its
policies with respect to capital adequacy) by an amount deemed by such Bank
to be material, then from time to time, within 15 days after demand by such
Bank (with a copy to the Agent), the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank (or its Parent) for
such reduction; PROVIDED that the Borrower shall not be liable for any such
amounts attributable to a period more than three months prior to the date of
notice by such Bank to the Borrower of its intention to seek compensation
under this subsection (b).
(c) Each Bank will promptly notify the Borrower and the Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section and will designate
a different Applicable Lending Office if such designation will avoid the need
for, or
45
reduce the amount of, such compensation and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section, setting forth the additional amount
or amounts to be paid to it hereunder and the basis of calculation thereof,
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
SECTION 8.04. TAXES. (a) Any and all payments by the Borrower to or
for the account of any Bank or the Agent hereunder or under any Note shall be
made free and clear of and without deduction for any and all present or
future taxes, duties, levies, imposts, deductions, charges and withholdings,
and all liabilities with respect thereto, EXCLUDING, in the case of each Bank
and the Agent, taxes imposed on its income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Bank or the Agent (as
the case may be) is organized or any political subdivision thereof and, in
the case of each Bank, taxes imposed on its income, and franchise or similar
taxes imposed on it, by the jurisdiction of such Bank's Applicable Lending
Office or any political subdivision thereof (all such non-excluded taxes,
duties, levies, imposts, deductions, charges, withholdings and liabilities
being hereinafter referred to as "Taxes"). If the Borrower shall be required
by law to deduct any Taxes from or in respect of any sum payable hereunder or
under any Note to any Bank or the Agent, (i) the sum payable shall be
increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 8.04) such Bank or the Agent (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, (iii) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law and (iv) the Borrower shall
furnish to the Agent, at its address referred to in Section 9.01, the
original or a certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, or charges
or similar levies which arise from any payment made hereunder or under any
Note or from the execution or delivery of, or otherwise with respect to, this
Agreement or any Note (hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Bank and the Agent for the full
amount of Taxes and Other Taxes (including, without limitation, any Taxes and
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section 8.04) paid by such Bank or the Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or with
46
respect thereto. This indemnification shall be made within 15 days from the
date such Bank or the Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Bank listed on the signature pages hereof and
on or prior to the date on which it becomes a Bank in the case of each other
Bank, and from time to time thereafter if requested in writing by the
Borrower (but only so long as such Bank remains lawfully able to do so),
shall provide the Borrower with Internal Revenue Service form 1001 or 4224,
as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Bank is entitled to benefits under an income
tax treaty to which the United States is a party which reduces the rate of
withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. If the form provided by
a Bank at the time such Bank first becomes a party to this Agreement
indicates a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from "Taxes" as
defined in Section 8.04(a).
(e) For any period with respect to which a Bank has failed to provide
the Borrower with the form required pursuant to Section 8.04(d), if any
(unless such failure is due to a change in treaty, law or regulation
occurring subsequent to the date on which a form originally was required to
be provided), such Bank shall not be entitled to indemnification under
Section 8.04(a) with respect to Taxes imposed by the United States; PROVIDED,
HOWEVER, that should a Bank, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes because of its
failure to deliver a form required hereunder, the Borrower shall take such
steps as such Bank shall reasonably request to assist such Bank to recover
such Taxes.
(f) If the Borrower is required to pay additional amounts to or for the
account of any Bank pursuant to this Section 8.04, then such Bank will change
the jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such
change, in the judgment of such Bank, is not otherwise disadvantageous to
such Bank.
SECTION 8.05. BASE RATE LOANS SUBSTITUTED FOR AFFECTED FIXED RATE LOANS.
If (i) the obligation of any Bank to make Euro-Dollar Loans has been suspended
pursuant to Section 8.02 or (ii) any Bank has demanded compensation under
Section 8.03 or 8.04 with respect to its CD Loans or Euro-Dollar Loans and the
Borrower shall, by at least five Euro-Dollar Business Days' prior notice to such
Bank through the Agent, have elected that the provisions of this Section shall
47
apply to such Bank, then, unless and until such Bank notifies the Borrower
that the circumstances giving rise to such suspension or demand for
compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as CD Loans or
Euro-Dollar Loans, as the case may be, shall be made instead as Base Rate
Loans (on which interest and principal shall be payable contemporaneously
with the related Fixed Rate Loans of the other Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case may
be, has been repaid, all payments of principal which would otherwise be
applied to repay such Fixed Rate Loans shall be applied to repay its Base
Rate Loans instead.
SECTION 8.06. SUBSTITUTION OF BANK. If (i) the obligation of any Bank
to make Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii)
any Bank has demanded compensation under Section 8.03 or 8.04, the Borrower
shall have the right, with the assistance of the Agent, to seek a mutually
satisfactory substitute bank or banks (which may be one or more of the Banks)
to purchase the Note and assume the Commitment of such Bank.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES. All notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, telex,
facsimile transmission or similar writing) and shall be given to such party:
(x) in the case of the Borrower or the Agent, at its address or facsimile or
telex number set forth on the signature pages hereof, (y) in the case of any
Bank, at its address or facsimile or telex number set forth in its
Administrative Questionnaire or (z) in the case of any party, such other
address or facsimile or telex number as such party may hereafter specify for
the purpose by notice to the Agent and the Borrower. Each such notice,
request or other communication shall be effective (i) if given by telex, when
such telex is transmitted to the telex number specified in this Section and
the appropriate answerback is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid or (iii) if given by any other means, when
delivered at the address specified in this Section; PROVIDED that notices to
the Agent under Article II or Article VIII shall not be effective until
received.
48
SECTION 9.02. NO WAIVERS. No failure or delay by the Agent or any Bank
in exercising any right, power or privilege under any Financing Document
shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies therein provided
shall be cumulative and not exclusive of any rights or remedies provided by
law.
SECTION 9.03. EXPENSES; INDEMNIFICATION. (a) The Borrower shall pay
(i) all out-of-pocket expenses of the Agent, including fees and disbursements
of special counsel for the Agent, in connection with the preparation and
administration of the Financing Documents, any waiver or consent thereunder
or any amendment thereof or any Default or alleged Default thereunder and
(ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agent or any Bank, including fees and disbursements of outside counsel
(or, in lieu thereof, the allocated cost of in-house counsel), in connection
with such Event of Default and collection, bankruptcy, insolvency and other
enforcement proceedings resulting therefrom.
(b) The Borrower agrees to indemnify the Agent and each Bank, their
respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in
connection with any investigative, administrative or judicial proceeding
(whether or not such Indemnitee shall be designated a party thereto) brought
or threatened relating to or arising out of the Financing Documents, or any
actual or proposed use of proceeds of Loans hereunder; PROVIDED that no
Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee's own gross negligence or willful misconduct.
SECTION 9.04. SHARING OF SET-OFFS. Each Bank agrees that if it shall,
by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of principal
and interest due with respect to any Note held by such other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Notes held by the Banks shall be
shared by the Banks pro rata; PROVIDED that nothing in this Section shall
impair the right of any Bank to exercise any right of set-off or counterclaim
it may have and to apply the amount subject to such exercise to the payment
of
49
indebtedness of the Borrower other than its indebtedness under the Notes.
The Borrower agrees, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in a Note, whether or not
acquired pursuant to the foregoing arrangements, may exercise rights of
set-off or counterclaim and other rights with respect to such participation
as fully as if such holder of a participation were a direct creditor of the
Borrower, in the amount of such participation.
SECTION 9.05. AMENDMENTS AND WAIVERS. Any provision of this Agreement
or the Notes may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of the Agent are affected thereby, by the
Agent); PROVIDED that no such amendment or waiver shall, unless signed by all
the Banks, (i) increase or decrease the Commitment of any Bank (except for a
ratable decrease in the Commitments of all Banks) or subject any Bank to any
additional obligation, (ii) reduce the principal of, accrued interest on or
rate of interest on any Loan or any fees hereunder, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any scheduled termination of any Commitment or (iv) change
the percentage of the Commitments or of the aggregate unpaid principal amount
of the Notes, or the number of Banks, which shall be required for the Banks
or any of them to take any action under this Section or any other provision
of the Financing Documents.
SECTION 9.06. SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that the Borrower
may not assign or otherwise transfer any of its rights under this Agreement
without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment
or in any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrower and the Agent, such Bank shall remain responsible for the
performance of its obligations hereunder, and the Borrower and the Agent
shall continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement. Any agreement
pursuant to which any Bank may grant such a participating interest shall
provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrower hereunder including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement; PROVIDED that such participation agreement may
provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (i), (ii) or (iii) of Section
9.05 without the
50
consent of the Participant. The Borrower agrees that each Participant shall,
to the extent provided in its participation agreement, be entitled to the
benefits of Section 2.15 and Article VIII with respect to its participating
interest. An assignment or other transfer which is not permitted by
subsection (c) or (d) below shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part (equivalent to
a Commitment of not less than $5,000,000) of all, of its rights and
obligations under this Agreement and the Notes, and such Assignee shall
assume such rights and obligations, pursuant to an Assignment and Assumption
Agreement in substantially the form of Exhibit G hereto executed by such
Assignee and such transferor Bank, with (and subject to) the subscribed
consent of the Borrower and the Agent (which consents shall not be
unreasonably withheld); PROVIDED that if an Assignee is another Bank
immediately prior to such assignment or is an affiliate of such transferor
Bank, no such consent shall be required; and PROVIDED FURTHER that such
assignment may, but need not, include rights of the transferor Bank in
respect of outstanding Money Market Loans. Upon execution and delivery of
such instrument and payment by such Assignee to such transferor Bank of an
amount equal to the purchase price agreed between such transferor Bank and
such Assignee, such Assignee shall be a Bank party to this Agreement and
shall have all the rights and obligations of a Bank with a Commitment as set
forth in such instrument of assumption, and the transferor Bank shall be
released from its obligations hereunder to a corresponding extent, and no
further consent or action by any party shall be required. Upon the
consummation of any assignment pursuant to this subsection (c), the
transferor Bank, the Agent and the Borrower shall make appropriate
arrangements so that, if required, a new Note is issued to the Assignee. In
connection with any such assignment, the transferor Bank shall pay to the
Agent an administrative fee for processing such assignment in the amount of
$2,500. If the Assignee is not incorporated under the laws of the United
States of America or a state thereof, it shall deliver to the Borrower and
the Agent certification as to exemption from deduction or withholding of any
United States federal income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its rights
under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's rights
shall be entitled to receive any greater payment under Section 8.03 or 8.04
than such Bank would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Borrower's prior written
consent or by
51
reason of the provisions of Section 8.02, 8.03 or 8.04 requiring such Bank to
designate a different Applicable Lending Office under certain circumstances.
SECTION 9.07. COLLATERAL. Each of the Banks represents to the Agent
and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.08. GOVERNING LAW; SUBMISSION TO JURISDICTION. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York State court sitting in New
York City for purposes of all legal proceedings arising out of or relating to
the Financing Documents or the transactions contemplated thereby. The
Borrower irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of
any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.
SECTION 9.09. COUNTERPARTS; INTEGRATION. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT
AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THE FINANCING DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED THEREBY.
52
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
UNOVA, INC.
By: /s/ Elmer C. Hull, Jr.
----------------------------------
Title: Treasurer
360 North Crescent Drive
Beverly Hills, California 90210
Telex number:
Telecopy number: (310) 888-2927
53
COMMITMENTS
$20,000,000 ABN AMRO BANK N.V.
By: /s/ John A. Miller
--------------------------------
Title: Group Vice President
By: /s/ Judith M. Bresnen
--------------------------------
Title: Vice President
$20,000,000 CITICORP USA, INC.
By: /s/ Walter L. Larson
--------------------------------
Title: Attorney-in-Fact
$20,000,000 DEUTSCHE BANK AG
NEW YORK BRANCH AND/OR CAYMAN
ISLANDS BRANCH
By: /s/ Hans-Joseph Thiele
--------------------------------
Title: Director
By: /s/ Stephan A. Wiedemann
--------------------------------
Title: Director
54
$8,000,000 CREDIT SUISSE FIRST BOSTON
By: /s/ Thomas G. Muoio
--------------------------------
Title: Vice President
By: /s/ William S. Lutkins
--------------------------------
Title: Vice President
$8,000,000 DRESDNER BANK AG
NEW YORK AND GRAND CAYMAN
BRANCHES
By: /s/ A. Richard Morris
--------------------------------
Title: First Vice president
By: /s/ B. Craig Erickson
--------------------------------
Title: Vice President
$8,000,000 MELLON BANK, N.A.
By: /s/ L. C. Ivey
--------------------------------
Title: Vice President
55
$8,000,000 MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By: /s/ Robert Bottamendi
--------------------------------
Title: Vice President
$8,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Mark A. Isley
--------------------------------
Title: First Vice President
- -----------------
Total Commitments
$100,000,000
=================
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By: /s/ Robert Bottamedi
--------------------------------
Title: Vice president
60 Wall Street
New York, New York 10260-0060
Attention:
Telex number: 177615
56
PRICING SCHEDULE
The "Euro-Dollar Margin", "CD Margin" and "Facility Fee Rate" for any
day are the respective percentages set forth below in the applicable row
under the column corresponding to the Status that exists on such day:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Level Level Level Level Level Level
Status I II III IV V VI
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Euro-Dollar Margin .285% .37% .41% .65% .75% .85%
- -------------------------------------------------------------------------------
CD Margin .41% .495% .535% .775% .875% .975%
- -------------------------------------------------------------------------------
Facility Fee Rate .065% .08% .09% .10% .125% .15%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
For purposes of this Schedule, the following terms have the following
meanings:
"Level I Status" exists at any date if, at such date, the
Borrower's long-term debt is rated A/A2 or higher by at least two Rating
Agencies.
"Level II Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated A-/A3 or higher by at least two
Rating Agencies and (ii) Level I Status does not exist at such date.
"Level III Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB+/Baa1 or higher by at least two
Rating Agencies and (ii) neither Level I Status nor Level II Status
exists at such date.
"Level IV Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB/Baa2 or higher by at least two
Rating Agencies and (ii) none of Level I Status, Level II Status or
Level III Status exists at such date.
"Level V Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB-/Baa3 or higher by at least two
Rating Agencies and (ii) none of Level I Status, Level II Status, Level
III Status or Level IV Status exists at such date.
"Level VI Status" exists at any date, if at the close of business
on such date, none of Level I Status, Level II Status, Level III Status,
Level IV Status or Level V Status exists.
"Status" refers to the determination of which of Level I Status,
Level II Status, Level III Status, Level IV Status, Level V Status or
Level VI Status exists at any date.
The credit ratings to be utilized for purposes of determining a
Status hereunder are those assigned to the senior unsecured long-term
debt of the Borrower without third-party credit enhancement, and any
rating assigned to any other debt of the Borrower shall be disregarded;
PROVIDED that if at any time the Borrower's senior unsecured long-term
debt is rated by exactly two Rating Agencies and the ratings assigned to
such debt by such two Rating Agencies are more than one full rating
category apart, Status shall be determined based on a rating one
category higher than the lower of such two ratings (e.g., if the S&P
rating is A+, the Moody's rating is Baa1 and there is no D&P rating,
then Level II Status shall exist); provided further that if at any time
the Borrower's senior unsecured long-term debt, without third party
credit enhancement, is not rated by at least two Rating Agencies, then
Status shall be Level VI Status. The rating in effect at any date is
that in effect at the close of business on such date.
2
EXHIBIT A
NOTE
New York, New York
January 13, 1999
For value received, UNOVA Inc., a Delaware corporation (the
"Borrower"), promises to pay to the order of (the
"Bank"), for the account of its Applicable Lending Office, the unpaid
principal amount of each Loan made by the Bank to the Borrower pursuant to
the Credit Agreement referred to below on the last day of the Interest
Period relating to such Loan. The Borrower promises to pay interest on the
unpaid principal amount of each such Loan on the dates and at the rate or
rates provided for in the Credit Agreement. All such payments of principal
and interest shall be made in lawful money of the United States in Federal
or other immediately available funds at the office of Morgan Guaranty Trust
Company of New York, 60 Wall Street, New York, New York.
Each Loan made by the Bank, the type and maturity thereof, and all
repayments of the principal thereof, shall be recorded by the Bank and, if
the Bank so elects in connection with any transfer or enforcement hereof,
appropriate notations to evidence the foregoing information with respect to
each Loan then outstanding may be endorsed by the Bank on the schedule
attached hereto, or on a continuation of such schedule attached to and made
a part hereof; PROVIDED that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under any other Financing Document.
This note is one of the Notes referred to in the Credit Agreement
dated as of January 13, 1999 among the Borrower, the banks parties thereto
and Morgan Guaranty Trust Company of New York, as Agent (as the same may be
amended from time to time, the "Credit Agreement"). Terms defined in the
Credit Agreement are used herein with the same meanings. Reference is made
to the Credit Agreement for provisions for the prepayment hereof and the
acceleration of the maturity hereof.
UNOVA, INC.
By:
-------------------------------------
Name:
Title:
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
- --------------------------------------------------------------------------------
Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2
EXHIBIT B
FORM OF MONEY MARKET QUOTE REQUEST
[Date]
To: Morgan Guaranty Trust Company of New York
From: UNOVA, Inc. (the "Borrower")
Re: Credit Agreement (as amended from time to time, the "Credit
Agreement") dated as of January 13, 1999 among the Borrower, the Banks
parties thereto and Morgan Guaranty Trust Company of New York, as
Agent
We hereby give notice pursuant to Section 2.03 of the Credit Agreement
that we request Money Market Quotes for the following proposed Money Market
Borrowing(s):
Date of Borrowing: __________________
Principal Amount* Interest Period*
----------------- ----------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
- --------------------------
* Amount must be $10,000,000 or a larger multiple of $1,000,000.
* Not less than one month (LIBOR Auction) or not less than 7 days
(Absolute Rate Auction), subject to the provisions of the definition of
Interest Period.
Terms used herein have the meanings assigned to them in the Credit
Agreement.
UNOVA, INC.
By:
-------------------------------------
Title:
2
EXHIBIT C
FORM OF INVITATION FOR MONEY MARKET QUOTES
To: [Name of Bank]
Re: Invitation for Money Market Quotes
to UNOVA, Inc. (the "Borrower")
Pursuant to Section 2.03 of the Credit Agreement (as amended from time to
time, the "Credit Agreement") dated as of January 13, 1999 among the Borrower,
the Banks parties thereto and the undersigned, as Agent, we are pleased on
behalf of the Borrower to invite you to submit Money Market Quotes to the
Borrower for the following proposed Money Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
---------------- ---------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Please respond to this invitation by no later than [2:00 P.M.]
[9:30 A.M.](New York City time) on [date].
Terms used herein have the meanings assigned to them in the Credit
Agreement.
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By
---------------------------------
Authorized Officer
EXHIBIT D
FORM OF MONEY MARKET QUOTE
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
60 Wall Street
New York, New York 10260-0060
Attention:
Re: Money Market Quote to
UNOVA, Inc. (the "Borrower")
In response to your invitation on behalf of the Borrower dated
_____________, 19__, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: ________________________________
2. Person to contact at Quoting Bank:
_____________________________
3. Date of Borrowing: ____________________*
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
- --------- --------- ------------ --------------------
$
$
[Provided, that the aggregate principal amount of Money Market Loans for
which the above offers may be accepted shall not exceed $____________.]**
__________
* As specified in the related Invitation.
(notes continued on following page)
We understand and agree that the offer(s) set forth above,
subject to the satisfaction of the applicable conditions set forth in
the Credit Agreement (as amended from time to time, the "Credit
Agreement") dated as of January 13, 1999 among the Borrower, the Banks
parties thereto and yourselves, as Agent, irrevocably obligates us to
make the Money Market Loan(s) for which any offer(s) are accepted, in
whole or in part.
Terms used herein have the meanings assigned to them in the
Credit Agreement.
Very truly yours,
[NAME OF BANK]
Dated:_______________ By:__________________________
Authorized Officer
__________
** Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the individual
offers exceeds the amount the Bank is willing to lend. Bids must be made for
$5,000,000 or a larger multiple of $1,000,000.
*** Not less than one month or not less than 7 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for
the applicable Interest Period. Specify percentage (to the nearest 1/10,000
of 1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
2
EXHIBIT E
OPINION OF COUNSEL FOR THE BORROWER
__, 1999
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260-0060
Dear Sirs:
I am Senior Vice President and General Counsel of UNOVA, Inc. (the
"Borrower") and have acted in that capacity in connection with the Credit
Agreement (the "Credit Agreement") dated as of January 13, 1999 among the
Borrower, the banks listed on the signature pages thereof and Morgan Guaranty
Trust Company of New York, as Agent. Terms defined in the Credit Agreement
are used herein as therein defined.
I have examined originals or copies, certified or otherwise identified
to my satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as I have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower is a corporation duly incorporated, validly existing
and in good standing under the laws of Delaware and has all corporate powers
and all material governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower of the
Financing Documents are within its corporate powers, have been duly
authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do
not contravene, or constitute a default under, any provision of applicable
law or regulation or of the Borrower's Certificate of Incorporation or
by-laws or of any agreement, judgment, injunction, order, decree or other
instrument binding upon the Borrower or any of its Subsidiaries or result in
the creation or imposition of any Lien on any asset of the Borrower or any of
its Subsidiaries.
3. The Credit Agreement constitutes a valid and binding agreement of
the Borrower and the Notes constitute valid and binding obligations of the
Borrower.
4. There is no action, suit or proceeding pending against, or to the
best of my knowledge threatened against or affecting, the Borrower or any of
its Subsidiaries before any court or arbitrator or any governmental body,
agency or official which could reasonably be expected to materially and
adversely affect the business, consolidated financial position or
consolidated results of operations of the Borrower and its Consolidated
Subsidiaries, taken as a whole.
(b) There is no action, suit or proceeding pending against, or to the
best of my knowledge threatened against or affecting, the Borrower or any of
its Subsidiaries before any court or arbitrator or any governmental body,
agency or official which in any manner questions the validity or
enforceability of any Financing Document.
5. Each of the Borrower's Material Subsidiaries is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted.
I am a member of the Bar of the State of California, and the foregoing
opinion is limited to the laws of the State of California, the General
Corporation Law of the State of Delaware and the Federal laws of the United
States of America. Inasmuch as the Credit Agreement and the Notes are
governed by the law of the State of New York, I have assumed for purposes of
the foregoing opinion that such law is the same as the law of the State of
California.
Very truly yours,
2
EXHIBIT F
OPINION OF
DAVIS POLK & WARDWELL, SPECIAL COUNSEL
FOR THE AGENT
------------------
__, 1999
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260-0060
Dear Sirs:
We have participated in the preparation of the Credit Agreement (the
"Credit Agreement") dated as of January 13, 1999 among UNOVA, Inc., a
Delaware corporation (the "Borrower"), the banks listed on the signature
pages thereof (the "Banks") and Morgan Guaranty Trust Company of New York, as
Agent (the "Agent"), and have acted as special counsel for the Agent for the
purpose of rendering this opinion pursuant to Section 3.01(d) of the Credit
Agreement. Terms defined in the Credit Agreement are used herein as therein
defined.
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of the
Financing Documents are within the Borrower's corporate powers and have been
duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding agreement of
the Borrower and each Note constitutes a valid and binding obligation of the
Borrower, in each case enforceable in accordance with its terms, except as
the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally
and by general principles of equity.
3. The documents delivered to the Agent by the Borrower pursuant to
Section 3.01 of the Credit Agreement are substantially responsive to the
requirements of said Section.
We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York, the federal laws of
the United States of America and the General Corporation Law of the State of
Delaware. In giving the foregoing opinion, we express no opinion as to the
effect (if any) of any law of any jurisdiction (except the State of New York)
in which any Bank is located which limits the rate of interest that such Bank
may charge or collect.
This opinion is rendered solely to you in connection with the above
matter. This opinion may not be relied upon by you for any other purpose or
relied upon by any other person without our prior written consent.
Very truly yours,
2
EXHIBIT G
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the "Assignor")
and [ASSIGNEE] (the "Assignee").
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the "Agreement")
relates to the Credit Agreement dated as of January 13, 1999 among the
Borrower, the Assignor and the other Banks party thereto, as Banks, and the
Agent (as amended from time to time, the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor has a
Commitment to make Committed Loans to the Borrower in an aggregate principal
amount at any time outstanding not to exceed $__________;
WHEREAS, Committed Loans made to the Borrower by the Assignor under the
Credit Agreement in the aggregate principal amount of $__________ are
outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the
rights of the Assignor under the Credit Agreement in respect of a portion of
its Commitment thereunder in an amount equal to $__________ (the "Assigned
Amount"), together with a corresponding portion of its outstanding Committed
Loans, and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Credit Agreement.
SECTION 2. ASSIGNMENT. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement and the
other Financing Documents to the extent of the Assigned Amount, and the Assignee
hereby accepts such assignment from the Assignor and assumes all of the
obligations of the Assignor under the Credit Agreement to the extent of the
Assigned Amount, including the purchase from the Assignor of the corresponding
portion of the principal amount of the Committed
Loans made by the Assignor outstanding at the date hereof. Upon the
execution and delivery hereof by the Assignor and the Assignee
[and the Borrower and the Agent](*) and the payment of the amounts specified
in Section 3 required to be paid on the date hereof (i) the Assignee shall,
as of the date hereof, succeed to the rights and be obligated to perform the
obligations of a Bank under the Credit Agreement and the other Financing
Documents with a Commitment in an amount equal to the Assigned Amount, and
(ii) the Commitment of the Assignor shall, as of the date hereof, be reduced
by a like amount and the Assignor released from its obligations under the
Credit Agreement to the extent such obligations have been assumed by the
Assignee. The assignment provided for herein shall be without recourse to
the Assignor.
SECTION 3. PAYMENTS. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on
the date hereof in Federal funds the amount heretofore agreed between them.
It is understood that facility fees accrued to the date hereof are for the
account of the Assignor and such fees accruing from and including the date
hereof in respect of the Assigned Amount are for the account of the Assignee.
Each of the Assignor and the Assignee hereby agrees that if it receives any
amount under the Credit Agreement or any other Financing Document which is
for the account of the other party hereto, it shall receive the same for the
account of such other party to the extent of such other party's interest
therein and shall promptly pay the same to such other party.
[SECTION 4. CONSENT OF THE BORROWER AND THE AGENT. This Agreement is
conditioned upon the consent of the Borrower and the Agent pursuant to Section
9.06(c) of the Credit Agreement. The execution of this Agreement by the
Borrower and the Agent is evidence of this consent.]
[SECTION 5. NOTE. Pursuant to Section 9.06(c) the Borrower agrees to
execute and deliver a Note payable to the order of the Assignee to evidence the
assignment and assumption provided for herein.](*)
SECTION 6. NON-RELIANCE ON ASSIGNOR. The Assignor makes no
representation or warranty in connection with, and shall have no
responsibility with respect to, the solvency, financial condition, or
statements of the Borrower, or the validity and enforceability of the
obligations of the Borrower in respect of any Financing Document. The
Assignee acknowledges that it has, independently and without reliance on the
Assignor, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement and will continue
__________________
* Delete if consent is not required.
* Delete if the Assignee is already a Bank, since it already has a Note.
2
to be responsible for making its own independent appraisal of the business,
affairs and financial condition of the Borrower.
SECTION 7. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 8. COUNTERPARTS. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
[ASSIGNOR]
By:
----------------------------------------------
Title:
[ASSIGNEE]
By:
----------------------------------------------
Title:
[The undersigned consent to the foregoing assignment.
UNOVA, INC.
By:
----------------------------------------------
Title:
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
3
By:
----------------------------------------------
Title: ]
4