Exhibit 10.3 to 1997 Form 10-K
$250,000,000
364-DAY
CREDIT AGREEMENT
dated as of April 1, 1997
among
THE SERVICEMASTER COMPANY LIMITED PARTNERSHIP,
THE LENDERS
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
and
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation Agent
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J.P. MORGAN SECURITIES INC.,
Arranger
BANK OF AMERICA NT & SA
and
NATIONSBANK, N.A.
as Co-Agents
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
1.1. Defined Terms............................................................................ 1
1.2. Accounting Terms and Determinations...................................................... 20
1.3. Rules of Construction.................................................................... 20
1.4. Rounding................................................................................. 21
ARTICLE II
THE FACILITY
2.1. The Facility............................................................................. 21
2.1.1. Description of Facility.................................................... 21
2.1.2. Availability of Facility; Required Payments................................ 21
2.2. Committed Advances....................................................................... 21
2.2.1. Committed Advances......................................................... 21
2.2.2. Types of Committed Advances................................................ 22
2.2.3. Method of Selecting Types and Interest Periods for New Committed
Advances................................................................... 22
2.2.4. Conversion and Continuation of Outstanding Committed Advances.............. 23
2.3. Competitive Bid Advances................................................................. 24
2.3.1. Competitive Bid Option; Repayment of Competitive Bid Advances.............. 24
2.3.2. Competitive Bid Quote Request.............................................. 25
2.3.3. Submission and Contents of Competitive Bid Quotes.......................... 25
2.3.4. Acceptance and Notice by the Borrower...................................... 27
2.3.5. Allocation by the Borrower................................................. 27
2.3.6. Notice by the Borrower to the Administrative Agent......................... 28
2.4. Facility Fees............................................................................ 28
2.5. General Facility Terms................................................................... 28
2.5.1. Method of Borrowing........................................................ 28
2.5.2. Minimum Amount of Each Committed Advance................................... 29
2.5.3. Optional Principal Payments................................................ 29
2.5.4. Interest Periods........................................................... 30
2.5.5. Rate after Maturity........................................................ 30
2.5.6. Interest Payment Dates; Interest Basis..................................... 30
2.5.7. Method of Payment.......................................................... 31
2.5.8. Notes...................................................................... 32
2.5.9. Notification of Advances, Interest Rates and Prepayments................... 32
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2.5.10. Non-Receipt of Funds by the Administrative Agent........................... 32
2.5.11. Cancellation............................................................... 33
2.5.12. Lending Installations...................................................... 33
2.5.13. Currency Equivalents....................................................... 33
2.5.14. Taxes...................................................................... 34
2.5.15. Regulation D Compensation.................................................. 36
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1. Yield Protection......................................................................... 37
3.2. Changes in Capital Adequacy Regulations.................................................. 38
3.3. Availability of Types of Advances........................................................ 39
3.4. Funding Indemnification.................................................................. 40
3.5. Lender Statements; Limit on Retroactivity; Survival of Indemnity......................... 40
3.6. Foreign Subsidiary Costs................................................................. 41
3.7. Replacement of Lenders................................................................... 41
ARTICLE IV
CONDITIONS PRECEDENT
4.1. Initial Advance.......................................................................... 42
4.2. Initial Advance to each Eligible Subsidiary.............................................. 44
4.3. Each Advance............................................................................. 44
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
5.1. Organization and Authority............................................................... 45
5.2. Organization and Authority of Subsidiaries............................................... 46
5.3. Organization and Authority of Corporate General Partner.................................. 46
5.4. Business and Property.................................................................... 46
5.5. Financial Statements..................................................................... 47
5.6. Full Disclosure.......................................................................... 47
5.7. Pending Litigation....................................................................... 47
5.8. Loan Documents are Legal, Valid, Binding and Authorized.................................. 48
5.9. Governmental Consent..................................................................... 48
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5.10. Taxes.................................................................................... 48
5.11. Employee Retirement Income Security Act of 1974.......................................... 49
5.12. Investment Company Act................................................................... 49
5.13. Compliance with Environmental Laws....................................................... 49
5.14. Regulations U and X...................................................................... 50
ARTICLE VI
COVENANTS
6.1.1. Information................................................................ 50
6.1.2. Use of Parent Information.................................................. 51
6.2. Use of Proceeds.......................................................................... 52
6.3. Notice of Default........................................................................ 52
6.4. Inspection............................................................................... 52
6.5. Legal Existence, Etc..................................................................... 52
6.6. Insurance................................................................................ 53
6.7. Taxes, Claims for Labor and Materials, Compliance with Laws.............................. 53
6.8. Maintenance, Etc......................................................................... 53
6.9. Nature of Business....................................................................... 54
6.10. Restricted Payments...................................................................... 54
6.11. Payment of Dividends by Subsidiaries..................................................... 54
6.12. Transactions with Affiliates............................................................. 55
6.13. Negative Pledge.......................................................................... 55
6.14. Consolidations, Mergers and Sales of Assets.............................................. 57
6.15. Leverage Test............................................................................ 58
6.16. Subsidiary Debt Limitation............................................................... 58
ARTICLE VII
DEFAULTS
7.1. .........................................................................................58
7.2. .........................................................................................58
7.3. .........................................................................................58
7.4. .........................................................................................58
7.5. .........................................................................................59
7.6. .........................................................................................59
7.7. .........................................................................................59
7.8. .........................................................................................59
7.9. .........................................................................................59
7.10. .........................................................................................59
7.11. .........................................................................................60
7.12. .........................................................................................60
7.13. .........................................................................................60
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ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration............................................................................. 60
8.2. Amendments............................................................................... 60
8.3. Preservation of Rights................................................................... 61
ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations.............................................................. 62
9.2. Headings................................................................................. 62
9.3. Entire Agreement......................................................................... 62
9.4. Several Obligations...................................................................... 62
9.5. Expenses; Indemnification................................................................ 62
9.6. Numbers of Documents..................................................................... 63
9.7. Severability of Provisions............................................................... 64
9.8. Nonliability of Lenders.................................................................. 64
9.9. CHOICE OF LAW............................................................................ 64
9.10. CONSENT TO JURISDICTION.................................................................. 64
9.11. WAIVER OF JURY TRIAL..................................................................... 64
9.12. Confidentiality.......................................................................... 65
ARTICLE X
THE AGENTS
10.1. Appointment.............................................................................. 65
10.2. Powers................................................................................... 65
10.3. General Immunity......................................................................... 65
10.4. No Responsibility for Loans, Recitals, etc............................................... 66
10.5. Action on Instructions of Lenders........................................................ 66
10.6. Employment of Agents and Counsel......................................................... 66
10.7. Reliance on Documents; Counsel........................................................... 66
10.8. Agent's Reimbursement and Indemnification................................................ 67
10.9. Rights as a Lender....................................................................... 67
10.10. Lender Credit Decision................................................................... 67
10.11. Successor Agent.......................................................................... 68
10.12. Agents' Fees............................................................................. 68
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ARTICLE XI
SETOFF RATABLE PAYMENTS
11.1. Setoff................................................................................... 68
11.2. Ratable Payments......................................................................... 69
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns................................................................... 69
12.2. Participations........................................................................... 70
12.2.1. Permitted Participants; Effect............................................. 70
12.2.2. Voting Rights.............................................................. 70
12.3. Assignments.............................................................................. 70
12.3.1. Permitted Assignments...................................................... 70
12.3.2. Effect; Effective Date..................................................... 71
12.4. Dissemination of Information............................................................. 71
12.5. Tax Treatment............................................................................ 72
12.6. Increased Costs................................................................................. 72
ARTICLE XIII
NOTICES
13.1. Giving Notice............................................................................ 72
ARTICLE XIV
REPRESENTATIONS AND WARRANTIES
OF ELIGIBLE SUBSIDIARIES
14.1. Existence and Power...................................................................... 73
14.2. Corporate or Partnership and Governmental Authorization; Contravention................... 73
14.3. Binding Effect........................................................................... 73
14.4. Taxes.................................................................................... 73
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ARTICLE XV
GUARANTY
15.1. The Guaranty............................................................................. 74
15.2. Guaranty Unconditional................................................................... 74
15.3. Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances.............. 75
15.4. Waiver by the Company.................................................................... 75
15.5. Subrogation.............................................................................. 75
15.6. Stay of Acceleration..................................................................... 75
ARTICLE XVI
COUNTERPARTS; EFFECTIVENESS
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PRICING SCHEDULE
Schedule 6.11 Subsidiary Restrictions
Exhibit "A" Note
Exhibit "B-1" Form of Opinion of Kirkland & Ellis
Exhibit "B-2" Form of Opinion of General Counsel
Exhibit "C" Form of Competitive Bid Quote Request
Exhibit "D" Form of Competitive Bid Quote
Exhibit "E" Form of Assignment Agreement
Exhibit "F" Form of Loan/Credit Related Money Transfer
Instruction
Exhibit "G" Form of Election to Participate
Exhibit "H" Form of Election to Terminate
Exhibit "I" Form of Opinion of Counsel for Eligible
Subsidiary
Exhibit "J" Form of Opinion of Counsel for the Agents
Page vii
364-DAY
CREDIT AGREEMENT
This 364-Day Credit Agreement, dated as of April 1, 1997, is
among The ServiceMaster Company Limited Partnership, the Lenders, The First
National Bank of Chicago, as Administrative Agent, and Morgan Guaranty Trust
Company of New York, as Documentation Agent. The parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
1.1. Defined Terms. As used in this Agreement:
"Absolute Rate" means, with respect to a Loan made by a given
Lender for the relevant Absolute Rate Interest Period, the rate of interest per
annum (rounded to the nearest 1/100 of 1%) offered by such Lender and accepted
by the Borrower pursuant to Section 2.3.4.
"Absolute Rate Advance" means a borrowing hereunder consisting
of the aggregate amount of the several Absolute Rate Loans made by some or all
of the Lenders to the Borrower at the same time and for the same Absolute Rate
Interest Period.
"Absolute Rate Auction" means a solicitation of Competitive
Bid Quotes setting forth Absolute Rates pursuant to Section 2.3.
"Absolute Rate Interest Period" means, with respect to an
Absolute Rate Advance or an Absolute Rate Loan, a period of not less than 7 days
commencing on a Business Day selected by the Borrower pursuant to this
Agreement. If such Absolute Rate Interest Period would end on a day which is not
a Business Day, such Absolute Rate Interest Period shall end on the next
succeeding Business Day.
"Absolute Rate Loan" means a Loan which bears interest at an
Absolute Rate.
"Acquiring Person" means any Person (other than the Parent,
the Surviving Parent and the Surviving Company) or group of two or more Persons
acting as a partnership, limited partnership, syndicate, or other group for the
purpose of acquiring, holding or disposing of Equity Interests of the Company,
the Surviving Company, the Parent or the Surviving Parent, together with all
affiliates and associates (as defined in Rule 12b-2 under the Securities and
Exchange Act of 1934, as amended) of such Person or Persons.
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"Administrative Agent" means The First National Bank of
Chicago in its capacity as contractual representative for the Lenders pursuant
to Article X, and not in its individual capacity as a Lender, and any successor
Administrative Agent appointed pursuant to Article X.
"Administrative Questionnaire" means, with respect to each
Lender, an administrative questionnaire in a form satisfactory to the
Administrative Agent and submitted to the Administrative Agent (with a copy to
the Company) duly completed by each Lender.
"Advance" means a borrowing hereunder consisting of the
aggregate amount of the several Loans made by some or all of the Lenders to the
Borrower of the same Type (or on the same interest basis in the case of
Competitive Bid Advances) and, in the case of Fixed Rate Advances, for the same
Interest Period and includes a Competitive Bid Advance.
"Affected Lender" is defined in Section 3.7.
"Affiliate" means any Person (other than a Subsidiary) which
directly or indirectly controls, or is controlled by, or is under common control
with, the Company. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of Voting Equity Interest,
by contract or otherwise.
"Agent" means the Administrative Agent or the Documentation
Agent and "Agents" means both of the foregoing.
"Aggregate Commitment" means the aggregate of the Commitments
of all the Lenders hereunder, as reduced from time to time pursuant to the terms
hereof.
"Agreement" means this Credit Agreement, as it may be amended
or modified and in effect from time to time.
"Alternate Base Rate" means, on any date and with respect to
all Floating Rate Advances, a fluctuating rate of interest per annum equal to
the higher of (i) the Federal Funds Effective Rate most recently determined by
the Administrative Agent plus 1/2% per annum and (ii) the Corporate Base Rate.
Changes in the rate of interest on each Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. The Administrative
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Agent will give notice promptly to the Borrowers and the Lenders of changes in
the Alternate Base Rate, provided, however, that the Administrative Agent's
failure to give any such notice will not affect any Borrower's obligation to pay
interest to the Lenders on Floating Rate Advances at the then effective
Alternate Base Rate.
"Alternative Currency" means British Sterling, German Marks,
French Francs, Japanese Yen, Dutch Guilders, Swedish Kronor and any other
currency (other than Dollars) which is freely transferable and convertible into
Dollars in the London interbank market which has been expressly approved in
writing as an Alternative Currency for purposes hereof by all Lenders.
"Annual Report" is defined in Section 5.4.
"Applicable Margin" means the respective margin percentages
for each Committed Fixed Rate Advance determined in accordance with the Pricing
Schedule.
"Approved Multiple" means (a) in respect of any borrowing or
prepayment of a Floating Rate Advance, $1,000,000 or any larger integral
multiple of $1,000,000, (b) in the case of any other Advance denominated in
Dollars, $5,000,000 or any larger integral multiple of $1,000,000 and (c) in the
case of any Advance denominated in an Alternative Currency, such multiples of
such currency as the Administrative Agent deems appropriate and reasonably
comparable to a $3,000,000 minimum Dollar Amount.
"Article" means an article of this Agreement unless another
document is specifically referenced.
"Assessment Rate" means, for any CD Interest Period, the net
assessment rate per annum payable to the Federal Deposit Insurance Corporation
(or any successor) for the insurance of domestic deposits of the Administrative
Agent during the calendar year in which the first day of such CD Interest Period
falls, as estimated by the Administrative Agent on the first day of such CD
Interest Period.
"Board of Directors" prior to the Effective Date of the
Reorganization means the Board of Directors of the Corporate General Partner and
on or after the Effective Date of the Reorganization means the Board of
Directors of the Company.
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"Borrower" means any Obligor in its capacity as borrower of a
Loan or Advance hereunder, and "Borrowers" means all such borrowers. References
to "the Borrower" in relation to any Loan or Advance are to the Borrower which
has borrowed or which proposes to borrow such Loan or Advance.
"Borrowing Date" means a date on which an Advance is made or to be
made hereunder.
"British Sterling" means the lawful currency of the United Kingdom.
"Business Day" means (i) with respect to any borrowing,
payment or rate selection of Eurocurrency Committed Advances or Eurocurrency Bid
Rate Advances, a day other than Saturday or Sunday on which banks are open for
business in Chicago and New York City and on which dealings in the relevant
currency are carried on in the London interbank market and, where funds are to
be paid or made available in an Alternative Currency, on which commercial banks
are open for domestic and international business in the place where such funds
are paid or made available and (ii) for all other purposes, a day other than
Saturday or Sunday on which banks are open for business in Chicago and New York
City.
"CD Interest Period" means, with respect to a Fixed CD Rate
Advance or a Fixed CD Rate Loan, a period of 30, 60, 90 or 180 days commencing
on a Business Day selected by the Borrower pursuant to this Agreement. If such
CD Interest Period would end on a day which is not a Business Day, such CD
Interest Period shall end on the next succeeding Business Day.
"Change of Control" shall be deemed to have occurred:
(a) prior to the Effective Date of the Reorganization, on the date on which:
(i) the Corporate General Partner ceases to have a Controlling General
Partnership Interest in both the Company and the Parent; or
(ii) Voting Stock of the Corporate General Partner sufficient to
elect at least a majority of its board of directors ceases to be
subject to the voting trust arrangement described in the Form 10-K; or
(iii) Continuing Directors cease to constitute a majority of the
board of directors of the Corporate General Partner; or
Page 4
(iv) an Acquiring Person shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended) of more than 30% (or if such Acquiring Person is WMX
Technologies, Inc. or one of its subsidiaries, 40%) of the Limited
Partnership Interests in the Company or the Parent; and
(b) on and after the Effective Date of the Reorganization,
on the date on which:
(i) Continuing Directors cease to constitute a majority of the
board of directors of the Surviving Parent or, if the Surviving Parent
and the Surviving Company shall have merged or consolidated, of the
Surviving Company; or
(ii) the Surviving Company shall cease to be a subsidiary of the
Surviving Parent (except by reason of a merger or consolidation between
them or the liquidation of the Surviving Company into the Surviving
Parent); or
(iii) an Acquiring Person shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended) of more than 30% (or if such Acquiring Person is WMX
Technologies, Inc. or one of its subsidiaries, 40%) of the Voting Stock
in the Surviving Company or the Surviving Parent.
For avoidance of doubt, the Reorganization and related transactions described in
the Proxy Statement do not in and of themselves give rise to a Change of
Control.
"Commitment" means, for each Lender, the obligation of the
Lender to make Loans to the Borrowers not exceeding the amount set forth
opposite its signature below or as set forth in an applicable Assignment
Agreement substantially in the form of Exhibit "E" hereto received by the
Administrative Agent under the terms of Section 12.3, as such amount may be
modified from time to time pursuant to the terms of this Agreement.
"Committed Advance" means a borrowing hereunder consisting of
the aggregate amount of the several Committed Loans made by the Lenders to the
Borrower at the same time, of the same Type and, in the case of Fixed Rate
Advances, for the same Interest Period.
"Committed Borrowing Notice" is defined in Section 2.2.3.
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"Committed Fixed Rate Advance" means a Fixed CD Rate Advance or a
Eurocurrency Committed Advance.
"Committed Loan" means a Loan made by a Lender pursuant to
Section 2.2.
"Company" means The ServiceMaster Company Limited Partnership,
a Delaware limited partnership and its permitted successors and assigns
including the Surviving Company following the assumption of the obligations of
the Company hereunder pursuant to Section 6.14.
"Competitive Bid Advance" means a borrowing hereunder
consisting of the aggregate amount of the several Competitive Bid Loans made by
some or all of the Lenders to the Borrower at the same time, at the same
interest basis, and for the same Interest Period.
"Competitive Bid Borrowing Notice" is defined in Section 2.3.4.
"Competitive Bid Loan" means a Eurocurrency Bid Rate Loan or
an Absolute Rate Loan, as the case may be.
"Competitive Bid Margin" means the margin above or below the
applicable Eurocurrency Base Rate offered for a Eurocurrency Bid Rate Loan,
expressed as a percentage (rounded to the nearest 1/100 of 1%) to be added or
subtracted from such Eurocurrency Base Rate.
"Competitive Bid Quote" means a Competitive Bid Quote
substantially in the form of Exhibit "D" hereto completed and delivered by a
Lender to the Borrower in accordance with Section 2.3.3.
"Competitive Bid Quote Request" means a Competitive Bid Quote
Request substantially in the form of Exhibit "C" hereto completed and delivered
by the Borrower in accordance with Section 2.3.3.
"Consolidated Debt" means at any date, without duplication,
the Debt of the Company and its Consolidated Subsidiaries, determined on a
consolidated basis as of such date.
"Consolidated EBIT" means, for any fiscal period, without
duplication, Consolidated Net Income for such period plus, to the extent
deducted in determining Consolidated Net Income for such period, the aggregate
amount of (i) Consolidated Interest Expense and (ii) income tax expense.
Page 6
"Consolidated EBITDA" means, for any fiscal period, without
duplication, Consolidated EBIT for such period plus to the extent deducted in
determining Consolidated Net Income for such period, the aggregate amount of
depreciation and amortization. In the event of a purchase by the Company or a
Consolidated Subsidiary of all or any portion of the minority interest in SMCS,
Consolidated EBITDA for any period of four consecutive fiscal quarters ending on
or after the date of such purchase and prior to the first anniversary thereof
shall be determined as if such purchase had been made on the first day of such
four-quarter period.
"Consolidated Interest Expense" means, for any fiscal period,
without duplication, the interest expense of the Company and its Consolidated
Subsidiaries plus dividends accrued on preferred stock of the Company or a
Consolidated Subsidiary which constitutes Debt, all determined on a consolidated
basis for such period.
"Consolidated Net Income" means, for any fiscal period,
without duplication, the net income of the Company and its Consolidated
Subsidiaries (before dividends on preferred stock of the Company) determined on
a consolidated basis for such period, exclusive of the effect of (i) any
extraordinary or other unusual gain and (ii) any extraordinary or other unusual
losses, write-offs or write-downs to the extent that such losses, write-offs or
write-downs do not represent a cash expenditure in such period and will not
represent a cash expenditure in any future period.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity which would be consolidated with the Company in its consolidated
financial statements if such statements were prepared as of such date in
accordance with GAAP.
"Continuing Director" means (i) a director of the Corporate
General Partner at the date of this Agreement and (ii) an individual who after
the date of this Agreement becomes a director of the Corporate General Partner
(including any successor Corporate General Partner) or, after the Effective Date
of the Reorganization, of the Company and/or the Parent (x) in connection with
the death, disability or retirement of an incumbent director, or otherwise in
the ordinary course of the affairs of the corporation and (y) whose election was
effected or recommended by a majority of the Continuing Directors then in office
(or by a nominating committee appointed by such a majority of Continuing
Directors). For avoidance of doubt, the foregoing definition contemplates that
Page 7
the same individuals would successively constitute the Continuing Directors of
the Corporate General Partner, any successor Corporate General Partner and, upon
consummation of the Reorganization, the Parent and/or the Company, subject to
normal turnover.
"Controlling General Partner Interest" means a General
Partnership Interest which permits the owner of such General Partnership
Interest to direct the management of a general partnership or a limited
partnership.
"Conversion/Continuation Notice" is defined in Section 2.2.4.
"Corporate Base Rate" means a rate per annum equal to the
corporate base rate of interest announced by the Administrative Agent from time
to time, changing when and as said corporate base rate changes.
"Corporate General Partner" means ServiceMaster Management
Corporation, a Delaware corporation, 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 or accrued expenses arising
in the ordinary course of business, (iv) all obligations of such Person as
lessee which are capitalized in accordance with GAAP, (v) all obligations
(absolute or contingent) of such Person to reimburse any bank or other Person
issuing a letter of credit or similar instrument, (vi) any preferred stock
issued by such Person which is redeemable otherwise than at the sole option of
such Person for consideration other than Equity Interests in such Person, in the
Company or in the Parent, (vii) 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
(viii) all Guaranties by such Person of Debt of others.
"Debt Limit" means, at any date, the product of (a)
Consolidated EBITDA for the period of four consecutive fiscal quarters ending at
the date of the balance sheet most recently delivered (or required to be
delivered) on or prior to such date pursuant to Section 5.5 or 6.1 and (b) the
applicable Leverage Factor.
"Default" means an event described in Article VII.
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"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.
Any determination of the amount of Derivatives Obligations owing at any time
shall be calculated net of offsets available at such time under any applicable
netting agreement.
"Disclosure Documents" is defined in Section 5.4.
"Documentation Agent" means Morgan, in its capacity as the
contractual representative for all of the Banks for purposes of this Agreement,
as designated and appointed in accordance with Article X, any successor thereto
as provided herein.
"Dollar Amount" means (i) in relation to any Advance
denominated in Dollars, the aggregate principal amount thereof and (ii) in
relation to any Advance denominated in an Alternative Currency, the equivalent
amount thereof in Dollars determined by the Administrative Agent pursuant to
Section 2.5.13. The Dollar Amount of any Advance denominated in an Alternative
Currency at any date is the Dollar Amount thereof determined as of such date or,
if no Dollar Amount is determined as of such date in accordance with Section
2.5.13, then determined as of the then most recent date for which such a
determination has been made. Each Advance denominated in an Alternative Currency
shall be deemed a utilization of the Commitments in an amount equal to the
Dollar Amount thereof.
"Dollars" and the sign "$" mean the lawful currency of the
United States of America.
"D&P" means Duff & Phelps, Inc.
"Dutch Gilders" means the lawful currency of The Netherlands.
"Effective Date of the Reorganization" means the date upon
which the Reorganization shall be effective.
"Election to Participate" means an Election to Participate
substantially in the form of Exhibit "G" hereto.
Page 9
"Election to Terminate" means an Election to Terminate
substantially in the form of Exhibit "H" hereto.
"Eligible Subsidiary" means any Subsidiary of the Company as
to which an Election to Participate shall have been delivered to the Agents and
as to which an Election to Terminate shall not have been delivered to the
Agents. Each such Election to Participate and Election to Terminate shall be
duly executed on behalf of such Subsidiary and the Company. The delivery of an
Election to Terminate with respect to an Eligible Subsidiary shall not affect
any obligation of such Eligible Subsidiary theretofore incurred. The
Administrative Agent shall promptly give notice to the Lenders of the receipt of
any Election to Participate or Election to Terminate.
"Equity Interest" means, in the case of a corporation, stock
of any class, and in the case of a partnership or a limited partnership, a
General Partnership Interest or Limited Partnership Interest, but excluding
preferred stock which constitutes Debt.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"Eurocurrency Auction" means a solicitation of Competitive Bid
Quotes setting forth Competitive Bid Margins pursuant to Section 2.3.
"Eurocurrency Base Rate" means, with respect to a Eurocurrency
Committed Advance, a Eurocurrency Committed Loan, a Eurocurrency Bid Rate
Advance or a Eurocurrency Bid Rate Loan for the relevant Eurocurrency Interest
Period, the average of the respective rates per annum at which deposits in
Dollars or, in the case of any Eurocurrency Loan denominated in an Alternative
Currency, the relevant Alternative Currency are offered to each of the Reference
Banks in the London interbank market at approximately 11:00 a.m. (London time)
two Business Days before the first day of such Interest Period in an amount
approximately equal to the principal amount of the Loan of such Reference Bank
to which such Interest Period is to apply and for a period of time comparable to
such Interest Period (or, in the case of a Competitive Bid Advance, the amount
which would have been the amount of the Loan of such Reference Bank if such
Advance were a Committed Advance).
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"Eurocurrency Bid Rate" means, with respect to a Loan made by
a given Lender for the relevant Eurocurrency Interest Period, the sum of (i) the
Eurocurrency Base Rate and (ii) the Competitive Bid Margin offered by such
Lender and accepted by the Borrower pursuant to Section 2.3.4(i).
"Eurocurrency Bid Rate Advance" means a Competitive Bid Advance which
bears interest at a Eurocurrency Bid Rate.
"Eurocurrency Bid Rate Loan" means a Competitive Bid Loan which bears
interest at a Eurocurrency Bid Rate.
"Eurocurrency Committed Advance" means an Advance which bears
interest at a Eurocurrency Rate requested by the Borrower pursuant to Section
2.2.
"Eurocurrency Committed Loan" means a Loan which bears
interest at a Eurocurrency Rate requested by the Borrower pursuant to Section
2.2.
"Eurocurrency Interest Period" means, with respect to a
Eurocurrency Committed Advance, a Eurocurrency Committed Loan, a Eurocurrency
Bid Rate Advance or a Eurocurrency Bid Rate Loan, a period of one, two, three or
six months commencing on a Business Day selected by the Borrower pursuant to
this Agreement. Such Eurocurrency Interest Period shall end on the day which
corresponds numerically to such date of commencement one, two, three or six
months thereafter, provided, however, that any such period which begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such period)
shall end on the last Business Day of a calendar month. If a Eurocurrency
Interest Period would otherwise end on a day which is not a Business Day, such
Eurocurrency Interest Period shall end on the next succeeding Business Day,
provided, however, that if such next succeeding Business Day falls in a new
month, such Eurocurrency Interest Period shall end on the immediately preceding
Business Day.
"Eurocurrency Loan" means a Eurocurrency Committed Loan or a
Eurocurrency Bid Rate Loan, as applicable.
"Eurocurrency Rate" means, with respect to a Eurocurrency
Committed Advance or a Eurocurrency Committed Loan for the relevant Eurocurrency
Interest Period, the sum of (a) the Eurocurrency Base Rate applicable to such
Eurocurrency Interest Period plus (b) the Applicable Margin.
Page 11
"Federal Funds Effective Rate" means, for any period, a
fluctuating interest rate per annum equal for each day during such period to (i)
the weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the preceding
Business Day) by the Federal Reserve Bank of New York; or (ii) if such rate is
not so published for any day which is a Business Day, the average of the
quotations at approximately 10:00 a.m. (Chicago time) for such day on such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by the Administrative Agent.
"Financial Officers" means with respect to the Company and any
Eligible Subsidiary, prior to the Effective Date of the Reorganization, the
Chief Financial Officer or Treasurer of the Corporate General Partner and
subsequent to the Effective Date of the Reorganization, the Chief Financial
Officer or Treasurer of the Company.
"First Chicago" means The First National Bank of Chicago in
its individual capacity, and its successors and assigns (by merger or
otherwise).
"5-Year Agreement" means the 5-Year Credit Agreement dated as
of April 1, 1997 among the Company, the Lenders listed therein, First Chicago,
as Administrative Agent and Morgan, as Documentation Agent.
"Fixed CD Base Rate" means, with respect to a Fixed CD Rate
Advance or a Fixed CD Rate Loan for the relevant CD Interest Period, the rate
determined by the Administrative Agent to be the arithmetic average of the rates
reported to the Administrative Agent as the prevailing bid rate for the purchase
at face value at or before 10:00 a.m. (Chicago time) on the first day of such CD
Interest Period by three certificate of deposit dealers in New York or Chicago
of recognized standing selected by the Administrative Agent of certificates of
deposit of each Reference Bank in the approximate amount of such Reference
Bank's relevant Fixed CD Rate Loan and having a maturity approximately equal to
such CD Interest Period.
"Fixed CD Rate" means, with respect to a Fixed CD Rate Advance
or Fixed CD Rate Loan for the relevant CD Interest Period, a rate per annum
equal to the sum of (i) the quotient of (a) the Fixed CD Base Rate applicable to
that CD Interest Period, divided by (b) one minus the Reserve Requirement
(expressed as a decimal) applicable to that CD Interest Period, plus (ii) the
Assessment Rate applicable to that CD Interest Period, plus (iii) the Applicable
Margin.
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"Fixed CD Rate Advance" means an Advance which bears interest
at a Fixed CD Rate.
"Fixed CD Rate Loan" means a Loan which bears interest at a
Fixed CD Rate.
"Fixed Rate" means the Fixed CD Rate, the Eurocurrency Rate, the
Eurocurrency Bid Rate or the Absolute Rate.
"Fixed Rate Advance" means an Advance which bears interest at
a Fixed Rate.
"Fixed Rate Loan" means a Loan which bears interest at a Fixed
Rate.
"Floating Rate" means, for any day, a rate per annum equal to the
Alternate Base Rate.
"Floating Rate Advance" means an Advance which bears interest
at the Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at the
Floating Rate.
"Form 10-K" is defined in Section 5.4.
"French Francs" means the lawful currency of France.
"GAAP" means generally accepted accounting principles in
effect from time to time in the United States of America.
"General Partnership Interest" means the interest of a general
partner in a general partnership and the interest of a general partner in a
limited partnership.
"German Marks" means the lawful currency of Germany.
"Guaranties" by any Person means all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Debt of any other Person (the "primary obligor") in any manner, whether directly
or indirectly, including, without limitation, all obligations incurred through
an agreement, contingent or otherwise, by such Person: (i) to purchase such Debt
or any property or assets constituting security therefor, (ii) to advance or
Page 13
supply funds (x) for the purchase or payment of such Debt, (y) to maintain
income, working capital or other balance sheet condition or otherwise to advance
or make available funds for the purchase or payment of such Debt, or (iii) to
lease property or to purchase Securities or other property or services primarily
for the purpose of assuring the owner of such Debt of the ability of the primary
obligor to make payment of the Debt, or (iv) otherwise to assure the owner of
the Debt of the primary obligor against loss in respect thereof. For the
purposes of all computations made under this Agreement, a Guaranty in respect of
any Debt shall be deemed to be Debt equal to the principal amount of such Debt
which has been guaranteed.
"Interest Period" means a CD Interest Period, a Eurocurrency
Interest Period or an Absolute Rate Interest Period.
"Japanese Yen" means the lawful currency of Japan.
"Lenders" means the financial institutions listed on the
signature pages of this Agreement and their respective successors and assigns.
"Lending Installation" means any office, branch, subsidiary or
affiliate of any Lender or the Administrative Agent.
"Leverage Factor" means, with respect to any period of four
consecutive fiscal quarters, if such period ends (a) prior to the fiscal quarter
in which the Effective Date of the Reorganization occurs, 4.25, (b) with the
fiscal quarter in which the Effective Date of the Reorganization occurs, 4.25,
(c) with the fiscal quarter immediately following the fiscal quarter in which
the Effective Date of the Reorganization occurs, 4.05, (d) with the second
fiscal quarter following the fiscal quarter in which the Effective Date of
Reorganization occurs, 3.825 and (e) with any fiscal quarter thereafter, 3.6.
"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 purpose of this Agreement, the Company or any Subsidiary shall be
deemed to own subject to a Lien (i) any asset that it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement or other title retention agreement relating to such asset or any
capital lease or (ii) any account receivable transferred by it with recourse for
collectibility (including any such transfer subject to a holdback or similar
arrangement which effectively imposes the risk of collectibility upon the
transferor).
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"Limited Partnership Interest" means the interest of a limited
partner in a limited partnership.
"Loan" means, with respect to a Lender, such Lender's portion,
if any, of any Advance.
"Loan Documents" means this Agreement, the Notes and each
Election to Participate and Election to Terminate.
"Material Adverse Effect" means (i) a material adverse effect
on the properties, business, operations or financial condition of the Company
and its Subsidiaries taken as a whole, (ii) a material adverse effect on the
ability of the Company to perform its obligations under the Loan Documents or
(iii) any material impairment of the rights and remedies of the Agents and the
Lenders against the Obligors under the Loan Documents.
"Material Commitment" means a legally binding commitment by
one or more banks or other financial institutions to extend credit to the
Company and/or its Subsidiaries in an aggregate amount of $25,000,000 or more
pursuant to a written agreement signed by the Company or a Subsidiary.
"Material Subsidiary" means (i) any Eligible Subsidiary and
(ii) any other Subsidiary which has consolidated assets or consolidated annual
revenues of more than $10,000,000.
"Maturity Date" means the Termination Date; provided that if
the Company shall have given notice to the Administrative Agent not less than 30
days prior to the Termination Date electing that this proviso be applicable,
then the Maturity Date in respect of all Committed Advances denominated in
Dollars (but not in respect of any Committed Advances denominated in an
Alternative Currency or any Competitive Bid Advances) shall be the first
anniversary of the Termination Date (or if such day is not a Business Day, the
next preceding Business Day). The Administrative Agent shall promptly notify
each Lender of any such notice received by it.
"Moody's" means Moody's Investors Service, Inc.
"Morgan" means Morgan Guaranty Trust Company of New York in
its individual capacity, and its successors and assigns.
Page 15
"Note" means a promissory note in substantially the form of
Exhibit "A" hereto, duly executed and delivered to the Documentation Agent by
the Borrower for the account of a Lender and payable to the order of such
Lender, including any amendment, modification, renewal or replacement of such
promissory note.
"Obligations" means all unpaid principal of and accrued and
unpaid interest on the Notes, all accrued and unpaid fees and all other
reimbursements, indemnities or other obligations of the Obligors to any Lender
or Agent arising under the Loan Documents.
"Obligor" means the Company or any Eligible Subsidiary, and
"Obligors" means all of them.
"Parent" means The ServiceMaster Limited Partnership, a
Delaware limited partnership, and its successors, including any corporate
successor resulting from the Reorganization.
"Partnership Interest" means Limited Partnership Interests and
General Partnership Interests.
"Payment Date" means the fifteenth day of each March, June,
September, and December.
"Person" means any corporation, limited liability company,
natural person, firm, joint venture, partnership, trust, unincorporated
organization, enterprise, government or any department or agency of any
government.
"Plans" is defined in Section 5.11.
"Pricing Level" is defined in the Pricing Schedule.
"Pricing Schedule" means the Schedule hereto entitled "Pricing
Schedule".
"Proxy Statement" means the Proxy Statement/Prospectus dated
December 11, 1991 of the Parent.
"Reference Banks" means Bank of America NT & SA, NationsBank,
N.A., First Chicago and Morgan. If any such Reference Bank ceases to be a
Lender, the Company and the Agents shall designate another Lender as a
replacement Reference Bank.
Page 16
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System from time to time in effect and shall include any
successor or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.
"Regulations U and X" means Regulations U and X of the Board
of Governors of the Federal Reserve System from time to time in effect and shall
include any successor or other regulations or official interpretations of said
Board of Governors relating to the extension of credit by banks for the purpose
of purchasing or carrying margin stock applicable to member banks of the Federal
Reserve System.
"Reorganization" means the change in the organizational
structure of the ServiceMaster enterprise substantially as described in the
Proxy Statement.
"Replacement Lender" is defined in Section 3.7.
"Required Lenders" means Lenders in the aggregate having at
least 66-2/3% of the Aggregate Commitment or, if the Aggregate Commitment has
been terminated, Lenders in the aggregate holding at least 66-2/3% of the
aggregate unpaid principal amount of the outstanding Advances.
"Reserve Requirement" means, with respect to a Eurocurrency
Interest Period or a CD Interest Period, the maximum aggregate reserve
requirement (including all basic, supplemental, marginal and other reserves)
which is imposed under Regulation D on new non-personal time deposits of
$100,000 or more with a maturity equal to that of the CD Interest Period (in the
case of Fixed CD Rate Advances or Fixed CD Rate Loans) or on Eurocurrency
liabilities (in the case of Eurocurrency Committed Advances or Eurocurrency
Committed Loans). The Reserve Requirement shall be adjusted automatically on and
as of the effective date of any change in the applicable reserve requirement.
"Restricted Payments" means, without duplication:
(a) the declaration or payment by the Company of any
dividends or distributions, either in cash or property, on any
Equity Interest of the Company (except dividends or other
distributions to the extent payable solely in Partnership
Interests of the Company or capital stock of the Company);
Page 17
(b) the purchase, acquisition, redemption or
retirement by the Company directly or indirectly, or through
any Subsidiary, of any Equity Interest of the Company or the
Parent or any warrants, rights or options to purchase or
acquire any Equity Interest of the Company or the Parent; and
(c) to the extent not included in clause (a) or (b)
above, any other payment or distribution by the Company,
either directly or indirectly or through any Subsidiary, in
respect of any Equity Interest of the Company or the Parent.
"SMCS" means ServiceMaster Consumer Services Limited
Partnership, a Delaware limited partnership.
"SMMS" means ServiceMaster Management Services Limited
Partnership, a Delaware limited partnership.
"Section" means a numbered section of this Agreement, unless
another document is specifically referenced.
"Security" shall have the same meaning as in Section (2)(1) of
the Securities Act of 1933, as amended.
"S&P" means Standard & Poor's Ratings Group.
The term "subsidiary" means, as to any particular parent
business entity, any business entity of which such parent business entity and/or
one or more business entities which are themselves subsidiaries of such parent
business entity, (i) in the case of any corporation, own more than 50% of the
Voting Stock, or (ii) in the case of any partnership other than SMCS and SMMS,
own a Controlling General Partnership Interest and, if any such partnership is a
limited partnership, own more than 50% of the Limited Partnership Interest;
provided, however, SMCS and SMMS shall be deemed subsidiaries of the Company so
long as (i) prior to the Effective Date of the Reorganization the Controlling
General Partnership Interest shall be owned by the Corporate General Partner and
(ii) the Company owns more than 50% of the Partnership Interests therein.
The term "Subsidiary" means a subsidiary of the Company.
"Surviving Company" means ServiceMaster Corporation, a
Delaware corporation, which as part of the Reorganization, shall be a
wholly-owned Subsidiary of the Surviving Parent, and its successors. As part of
the Reorganization the Parent and the Company will be liquidated into the
Surviving Company and the Surviving Company will assume the obligations of the
Company under the Loan Documents pursuant to Section 6.14.
Page 18
"Surviving Parent" means ServiceMaster Incorporated, a
Delaware corporation, which shall own 100% of the outstanding Voting Stock of
the Company following the consummation of the Reorganization, and its
successors. The Surviving Company and the Surviving Parent may merge or
consolidate as part of or following the Reorganization, in which case the
resulting or surviving entity shall be the Surviving Company for purposes of
this Agreement, or the Surviving Company may liquidate into the Surviving
Parent, in which case the Surviving Parent shall become and be the Surviving
Company, all in accordance with Section 6.14.
"Swedish Kronor" means the lawful currency of the Kingdom of
Sweden.
"Termination Date" means March 31, 1998, unless the
Commitments are earlier terminated pursuant to the terms hereof.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Loan or Advance, its nature
as a Floating Rate Advance or Loan, Fixed CD Rate Advance or Loan, Eurocurrency
Committed Advance or Loan in a particular currency, Eurocurrency Bid Rate
Advance or Loan in a particular currency or Absolute Rate Advance or Loan.
"Unmatured Default" means an event which, but for the lapse of
time or the giving of notice, or both, would constitute a Default.
"Voting Equity Interest" means Voting Stock and General
Partnership Interests.
"Voting Stock" means Securities of any class or classes, the
holders of which are ordinarily, in the absence of contingencies, entitled to
elect a majority of the corporate directors (or Persons performing similar
functions).
"WMX Repurchase" is defined in Section 6.2.
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The foregoing definitions shall be equally applicable to both
the singular and plural forms of the defined terms.
1.2. 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 GAAP,
applied on a basis consistent (except for changes concurred in by the Parent's
independent public accountants) with the most recent audited consolidated
financial statements of the Parent and its Consolidated Subsidiaries delivered
to the Banks; provided that, if the Company notifies the Documentation Agent
that the Company wishes to amend any covenant in Article VI to eliminate the
fact of any change in GAAP on the operation of such covenant (or if the
Documentation Agent notifies the Company that the Required Lenders wish to amend
Article VI for such purpose), then the Company's compliance with such covenant
shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Company and the
Required Lenders.
1.3. Rules of Construction. Any reference contained in any of
the Loan Documents to "knowledge" or "awareness" of the Company or any Eligible
Subsidiary shall be deemed limited to the "knowledge" or "awareness" of one or
more Financial Officers.
1.4. Rounding. All determinations of rates per annum under
this Agreement shall be rounded to the nearest 1/100th of 1% (with 0.0050% being
rounded upward to 0.01%).
ARTICLE II
THE FACILITY
2.1. The Facility.
2.1.1. Description of Facility. The Lenders grant to the
Borrowers a revolving credit facility pursuant to which, and upon the terms and
subject to the conditions herein set out:
(i) each Lender severally agrees to make Committed Loans in
Dollars or (in the case of Eurocurrency Committed Loans) in Alternative
Currencies to the Borrowers in accordance with Section 2.2;
Page 20
(ii) each Lender may, in its sole discretion, make bids to make
Competitive Bid Loans in Dollars or (in the case of Eurocurrency Bid
Rate Loans) in Alternative Currencies to the Borrowers in accordance
with Section 2.3; and
(iii) in no event may the sum of the aggregate Dollar Amount of all
outstanding Advances to all Borrowers (including both the Committed
Advances and the Competitive Bid Advances) exceed the Aggregate
Commitment.
2.1.2. Availability of Facility; Required Payments. Subject to
the terms and conditions set forth in this Agreement, the facility is available
from the date of this Agreement to the Termination Date, and the Borrowers may
borrow, repay and reborrow at any time prior to the Termination Date. The
Commitments to lend hereunder shall expire at the close of business on the
Termination Date. All outstanding Advances and all other unpaid Obligations
shall be paid in full on the Maturity Date.
2.2. Committed Advances.
2.2.1. Committed Advances. From and including the date of this
Agreement and to and including the Termination Date, each Lender severally
agrees, on the terms and conditions set forth in this Agreement, to make
Committed Loans to the Borrowers from time to time in Dollar Amounts not to
exceed in the aggregate at any one time outstanding to all Borrowers the amount
of such Lender's Commitment. Each Committed Advance hereunder shall consist of
borrowings made from the several Lenders ratably in proportion to the ratio that
their respective Commitments bear to the Aggregate Commitment. The Committed
Advances shall be evidenced by the Notes and shall be repaid as provided by the
terms of Section 2.1.2.
2.2.2. Types of Committed Advances. The Committed Advances may
be Floating Rate Advances, Fixed CD Rate Advances or Eurocurrency Committed
Advances, or a combination thereof, selected by the Borrower in accordance with
Sections 2.2.3 and 2.2.4.
2.2.3. Method of Selecting Types and Interest Periods for New
Committed Advances. The Borrower shall select the Type of Advance and, in the
case of each Fixed Rate Advance, the Interest Period applicable to each
Committed Advance from time to time. The Borrower shall give the Administrative
Agent notice (a "Committed Borrowing Notice") not later than 10:00 a.m. (Chicago
Page 21
time) on the Borrowing Date of each Floating Rate Advance, two Business Days
before the Borrowing Date of each Fixed CD Rate Advance, three Business Days
before the Borrowing Date for each Eurocurrency Committed Advance denominated in
Dollars and five Business Days before the Borrowing Date for each Eurocurrency
Committed Advance denominated in an Alternative Currency. A Committed Borrowing
Notice shall specify:
(i) the Borrowing Date, which shall be a Business Day, of such
Committed Advance;
(ii) the aggregate principal amount of such Committed Advance;
(iii) the Type of Committed Advance selected (including, in the case
of a Eurocurrency Committed Advance, the currency in which such Advance
is to be denominated; and
(iv) in the case of each Committed Fixed Rate Advance, the Interest
Period applicable thereto (which may not end after the Maturity Date).
Subject to Section 3.3, each Committed Borrowing Notice shall be irrevocable.
2.2.4. Conversion and Continuation of Outstanding Committed
Advances. Floating Rate Advances shall continue as Floating Rate Advances unless
and until such Floating Rate Advances are either prepaid in accordance with
Section 2.5.3 or converted into Committed Fixed Rate Advances denominated in
Dollars. Unless sooner prepaid in accordance with Section 2.5.3 or converted in
accordance with this Section, each Committed Fixed Rate Advance of any Type
shall continue as a Fixed Rate Advance of such Type until the end of the then
applicable Interest Period therefor, at which time (x) if such Fixed Rate
Advance is a Committed Fixed Rate Advance denominated in Dollars such Committed
Fixed Rate Advance shall be automatically converted into a Floating Rate Advance
unless the Borrower shall have given the Administrative Agent a timely notice of
prepayment thereof pursuant to Section 2.5.3 or a timely Conversion/Continuation
Notice requesting that, at the end of such Interest Period, such Committed Fixed
Rate Advance either continue as a Committed Fixed Rate Advance of such Type for
the same or another Interest Period or be converted into an Advance of another
Type denominated in Dollars and (y) subject to Section 2.5.13(b), if such Fixed
Rate Advance is a Committed Fixed Rate Advance denominated in an Alternative
Page 22
Currency, such Committed Fixed Rate Advance shall be automatically continued as
a Committed Fixed Rate Advance in the same Alternative Currency for an
additional Interest Period of one month, unless the Borrower shall have given
the Administrative Agent a timely notice of prepayment thereof pursuant to
Section 2.5.3 or a timely Continuation Notice requesting that at the end of such
Interest Period such Committed Fixed Rate Advance continue as a Committed Fixed
Rate Advance for another Interest Period. If the Administrative Agent does not
receive such timely notice of prepayment or Continuation Notice, it shall notify
the Lenders to such effect on the date such notice is due. Subject to the terms
of Section 2.5.2, the Borrower may elect from time to time to convert all or any
part of a Committed Advance of any Type denominated in Dollars into any other
Type or Types of Committed Advances denominated in Dollars; provided that any
conversion of any Committed Fixed Rate Advance on any day other than the last
day of the Interest Period applicable thereto shall be subject to Section 3.4.
The Borrower shall give the Administrative Agent notice (a
"Conversion/Continuation Notice") of each conversion of a Committed Advance or
continuation of a Committed Fixed Rate Advance not later than 10:00 a.m.
(Chicago time) on the date of, in the case of a conversion into a Floating Rate
Advance, or two Business Days, in the case of a conversion into or continuation
of a Fixed CD Rate Advance, three Business Days, in the case of a conversion
into or continuation of a Eurocurrency Committed Advance denominated in Dollars
or five Business Days, in the case of a continuation of a Eurocurrency Committed
Advance denominated in an Alternative Currency, prior to the date of, the
requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Committed Advance which is
to be converted or continued; and
(iii) the amount and Type(s) of Committed Advance(s) into which such
Committed Advance is to be converted or continued and, in the case of a
conversion into or continuation of a Committed Fixed Rate Advance, the
duration of the Interest Period applicable thereto (which may not end
after the Maturity Date).
Page 23
Subject to Section 3.3, each Conversion/Continuation Notice shall be
irrevocable. Changes in the currency in which an Advance is denominated may not
be effected by a conversion pursuant to this Section 2.2.4.
2.3. Competitive Bid Advances.
2.3.1. Competitive Bid Option; Repayment of Competitive Bid
Advances. In addition to Committed Advances pursuant to Section 2.2, but subject
to the terms and conditions set forth in this Agreement (including, without
limitation, the limitation set forth in Section 2.1.1(iii) as to the maximum
aggregate principal amount of all outstanding Advances hereunder and the
limitation set forth in Section 4.3(iii) as to the minimum credit standing for
Competitive Bid Advances), any Borrower may, as set forth in this Section 2.3,
request the Lenders, prior to the Termination Date, to make offers to make
Competitive Bid Advances to such Borrower. Each Lender 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
2.3. Competitive Bid Advances shall be evidenced by the Notes. Each Competitive
Bid Advance shall be repaid in full by the Borrower on the last day of the
Interest Period applicable thereto.
2.3.2. Competitive Bid Quote Request. When the Borrower wishes
to request offers to make Competitive Bid Loans under Section 2.3, it shall
transmit to each Lender by telex or telecopy a Competitive Bid Quote Request so
as to be received no later than (i) 10:00 a.m. (Chicago time) at least five
Business Days prior to the Borrowing Date proposed therein, in the case of a
Eurocurrency Auction denominated in Dollars, (ii) 10:00 a.m. (Chicago time) at
least seven Business Days prior to the Borrowing Date, in the case of a
Eurocurrency Auction denominated in an Alternative Currency or (iii) 10:00 a.m.
(Chicago time) at least one Business Day prior to the Borrowing Date proposed
therein, in the case of an Absolute Rate Auction specifying:
(a) the proposed Borrowing Date, which shall be a Business Day,
for the proposed Competitive Bid Advance;
(b) the aggregate principal amount of such Competitive Bid Advance;
(c) whether the Competitive Bid Quotes requested are to set forth
a Competitive Bid Margin or an Absolute Rate, or both;
(d) in the case of a Eurocurrency Auction, the currency in which
the Loans are to be denominated; and
Page 24
(e) the Interest Period applicable thereto (which may not end
after the Termination Date).
The Borrower may request offers to make Competitive Bid Loans for more than one
Interest Period and for a Eurocurrency Auction and an Absolute Rate Auction in a
single Competitive Bid Quote Request. No Competitive Bid Quote Request shall be
given within 3 Business Days of any other Competitive Bid Quote Request. Each
Competitive Bid Quote Request shall be in an Approved Multiple.
2.3.3. Submission and Contents of Competitive Bid Quotes. (i)
Each Lender may, in its sole discretion, submit to the Borrower a Competitive
Bid Quote containing an offer or offers to make Competitive Bid Loans in
response to any Invitation for Competitive Bid Quotes. Each Competitive Bid
Quote must comply with the requirements of this Section 2.3.3 and must be
submitted to the Borrower by telecopy at its address specified in or pursuant to
Article XIII not later than (a) 1:00 p.m. (Chicago time) at least three Business
Days prior to the proposed Borrowing Date, in the case of a Eurocurrency Auction
denominated in Dollars, (b) 1:00 p.m. (Chicago time) at least five Business Days
prior to the proposed Borrowing Date, in the case of a Eurocurrency Auction
denominated in an Alternative Currency or (c) 9:00 a.m. (Chicago time) on the
proposed Borrowing Date, in the case of an Absolute Rate Auction. Subject to
Articles IV and VIII, any Competitive Bid Quote so made shall be irrevocable.
(ii) Each Competitive Bid Quote shall in any case specify:
(a) the proposed Borrowing Date, which shall be the same as
that set forth in the applicable Invitation for Competitive Bid Quotes;
(b) the principal amount of the Competitive Bid Loan for which
each such offer is being made, which principal amount (1) may be
greater than, less than or equal to the Commitment of the quoting
Lender, (2) must be an Approved Multiple and (3) may not exceed the
principal amount of Competitive Bid Loans for which offers were
requested;
(c) in the case of a Eurocurrency Auction, the Competitive Bid
Margin offered for each such Competitive Bid Loan;
Page 25
(d) the limit, if any, as to the aggregate principal amount of
the Competitive Bid Loans from such Lender which may be accepted by the
Borrower;
(e) in the case of an Absolute Rate Auction, the Absolute Rate
offered for each such Competitive Bid Loan;
(f) the applicable Interest Period; and
(g) the identity of the quoting Lender.
(iii) The Borrower shall reject any Competitive Bid Quote that:
(a) is not substantially in the form of Exhibit "D" hereto or
does not specify all of the information required by Section 2.3.3(ii);
(b) contains qualifying, conditional or similar language,
other than any such language contained in Exhibit "D" hereto;
(c) proposes terms other than or in addition to those set
forth in the applicable Invitation for Competitive Bid Quotes; or
(d) arrives after the time set forth in Section 2.3.3(i).
If any Competitive Bid Quote shall be rejected pursuant to this Section
2.3.3(iii), then the Borrower shall notify the relevant Lender of such rejection
as soon as practical.
2.3.4. Acceptance and Notice by the Borrower. Not later than
(a) 2:00 p.m. (Chicago time) at least three Business Days prior to the proposed
Borrowing Date, in the case of a Eurocurrency Auction denominated in Dollars,
(b) 2:00 p.m. (Chicago time) at least five Business Days prior to the proposed
Borrowing Date, in the case of a Eurocurrency Auction denominated in an
Alternative Currency or (c) 10:00 a.m. (Chicago time) on the proposed Borrowing
Date, in the case of an Absolute Rate Auction, the Borrower shall notify each
Lender of its acceptance or rejection of the offers so notified to it pursuant
to Section 2.3.3; provided, however, that the failure by the Borrower to give
such notice to any Lender shall be deemed to be a rejection by the Borrower of
all such offers made by such Lender. In the case of acceptance, such notice (a
"Competitive Bid Borrowing Notice") shall specify the aggregate principal amount
of offers for each Interest Period that are accepted. The Borrower may accept or
reject any Competitive Bid Quote in whole or in part (subject to the terms of
Section 2.3.3(ii)(d)); provided that:
Page 26
(a) the aggregate principal amount of each Competitive Bid
Advance may not exceed the applicable amount set forth in the related
Competitive Bid Quote Request;
(b) acceptance of offers may only be made on the basis of
ascending Competitive Bid Margins or Absolute Rates, as the case may
be; and
(c) the Borrower may not accept any offer of the type
described in Section 2.3.3(iii) or that otherwise fails to comply with
the requirements of this Agreement for the purpose of obtaining a
Competitive Bid Loan under this Agreement.
2.3.5. Allocation by the Borrower. If offers are made by two
or more Lenders with the same Competitive Bid Margins or Absolute Rates, as the
case may be, for a greater aggregate principal amount than the amount in respect
of which offers are permitted to be accepted for the related Interest Period,
the principal amount of Competitive Bid Loans in respect of which such offers
are accepted shall be allocated by the Borrower among such Lenders as nearly as
possible (in such multiples, not greater than $1,000,000 (or the equivalent in
an Alternative Currency), as the Borrower may deem appropriate) in proportion to
the aggregate principal amount of such offers. Allocations by the Borrower of
the amounts of Competitive Bid Loans shall be conclusive in the absence of
manifest error. The Borrower shall promptly, but in any event on the same
Business Day in the case of Eurocurrency Bid Rate Advances, and by 11:00 a.m.
(Chicago time) in the case of Absolute Rate Advances, notify each Lender that
submitted a Competitive Bid Quote of its receipt of a Competitive Bid Borrowing
Notice and the aggregate principal amount of such Competitive Bid Advance
allocated to each participating Lender.
2.3.6. Notice by the Borrower to the Administrative Agent.
Promptly, but in any event on the same Business Day that the Borrower issues any
Competitive Bid Borrowing Notice, the Borrower shall give the Administrative
Agent notice of the amount, maturity, applicable interest rate and Lender for
each Competitive Bid Loan accepted by the Borrower pursuant to such Competitive
Bid Borrowing Notice.
2.4. Facility Fees. The Company hereby agrees to pay to the
Administrative Agent for the account of each Lender, ratably in the proportion
that such Lender's Commitment bears to the Aggregate Commitment, a per annum
facility fee at the Facility Fee Rate (determined daily in accordance with the
Page 27
Pricing Schedule) on the daily amount of the Aggregate Commitment (and, if any
Advances remain outstanding following termination of the Commitments, on the
daily aggregate Dollar Amount of all outstanding Advances), payable quarterly in
arrears on each Payment Date, on the Termination Date and, if later, on the date
on which all outstanding Advances shall have been repaid in full. All accrued
facility fees hereunder shall be payable on the effective date of any
termination of the obligations of the Lenders to make Loans hereunder.
2.5. General Facility Terms
2.5.1. Method of Borrowing. Not later than (i) 12:00 noon
(Chicago time) on each Borrowing Date for each Advance denominated in Dollars
and (ii) the funding deadline designated by the Administrative Agent in the case
of any Advance denominated in an Alternative Currency (which shall be no earlier
than 10:00 a.m. local time in the place of payment and no later than 12:00 noon
(Chicago time)), each Lender shall make available its Loan or Loans, if any, in
immediately available funds, to the Administrative Agent at its address
specified pursuant to Article XIII or at such other location as the
Administrative Agent shall direct. The Administrative Agent shall promptly
deposit the funds so received from the Lenders in the Borrower's account at the
Administrative Agent's main office in Chicago or as otherwise directed by the
Borrower. Notwithstanding the foregoing provisions of this Section 2.5.1, to the
extent that a Loan made to a Borrower by a Lender matures on the Borrowing Date
of a requested Loan to such Borrower in the same currency, such Lender shall
apply the proceeds of the Loan it is then making to the repayment of principal
of the maturing Loan.
2.5.2. Minimum Amount of Each Committed Advance. Each
Committed Advance shall be in an Approved Multiple; provided, however, that any
Floating Rate Advance may be in the aggregate amount of the unused Aggregate
Commitment.
2.5.3. Optional Principal Payments. The Borrower may from time
to time pay all of its outstanding Committed Advances, or, in an Approved
Multiple, any portion of the outstanding Committed Advances upon (i) in the case
of any Floating Rate Advance, notice to the Administrative Agent not later than
10:00 a.m. (Chicago time) on the date of prepayment, (ii) in the case of any
Fixed CD Rate Advance, two Business Days' prior notice to the Administrative
Agent, (iii) in the case of any Eurocurrency Committed Advance denominated in
Page 28
Dollars, three Business Days' prior notice to the Administrative Agent and (iv)
in the case of any Eurocurrency Committed Advance denominated in an Alternative
Currency, five Business Days' prior notice to the Administrative Agent. Any such
notice of prepayment shall be irrevocable. All such payments shall be made in
immediately available funds to the Administrative Agent at the Administrative
Agent's address specified in Article XIII or at any other location specified by
the Administrative Agent in accordance with Section 2.5.7 not later than (i)
noon (Chicago time) on the date of payment for each Advance denominated in
Dollars and (ii) the funding deadline designated by the Administrative Agent in
the case of any Advance denominated in an Alternative Currency (which should be
no earlier than 10:00 a.m. local time in the place of payment and no later than
12:00 noon (Chicago time)). Subject to Section 2.5.13(a), a Competitive Bid
Advance may not be prepaid prior to the last day of its applicable Interest
Period without the prior consent of the Lender which originally made such Loan,
which consent may be given or withheld at the Lender's sole and absolute
discretion, provided that no Competitive Bid Advance may be prepaid if there
exists a Default. Any prepayment of a Fixed Rate Advance prior to the end of its
applicable Interest Period shall be subject to the indemnity provisions of
Section 3.4.
2.5.4. Interest Periods. Subject to the provisions of Section
2.5.5, each Advance shall bear interest from and including the first day of the
Interest Period applicable thereto to (but not including) the earlier of (i) the
last day of such Interest Period or (ii) the date of any earlier prepayment as
permitted by Section 2.5.3, at the interest rate determined as applicable to
such Advance, payable in the currency of such Advance.
2.5.5. Rate after Maturity. Except as provided in the next
sentence, any Advance not paid at maturity, whether by acceleration or
otherwise, shall bear interest until paid in full at a rate per annum equal to
(i) in the case of an Advance denominated in Dollars, the Alternate Base Rate
plus 2% per annum, payable upon demand and (ii) in the case of an Advance
denominated in an Alternative Currency, the sum of 2% plus the Applicable Margin
for Eurocurrency Committed Advances for such day plus the quotient obtained by
dividing (x) the average of the respective rates per annum at which one day (or,
if such amount due remains unpaid more than five Business Days, then for such
other period of time not longer than three months as the Administrative Agent
Page 29
may select) deposits in such Alternative Currency in an amount approximately
equal to such overdue payment due to each of the Reference Banks (or, in the
case of a Competitive Bid Advance, the amount which would have been due to each
Reference Bank if such Advance were a Committed Advance) are offered to such
Reference Bank in the London interbank market for the applicable period
determined as provided above by (y) 1.00 minus the Reserve Requirement. In the
case of a Fixed Rate Advance the maturity of which is accelerated, such Fixed
Rate Advance shall bear interest for the remainder of the applicable Interest
Period (or until paid if paid prior to the end of such Interest Period), at the
higher of the rate otherwise applicable to such Fixed Rate Advance for such
Interest Period plus 2% per annum or the applicable rate specified in the
preceding sentence.
2.5.6. Interest Payment Dates; Interest Basis. Interest
accrued on each Fixed Rate Advance shall be payable on the last day of its
applicable Interest Period, on any date on which such Fixed Rate Advance is
prepaid or converted, and at the maturity of such Advance. Interest accrued on
each Floating Rate Advance shall be payable on each Payment Date, on any date on
which such Floating Rate Advance is prepaid, and at the maturity of such
Advance. Interest accrued on each Fixed Rate Advance having an Interest Period
longer than three months shall also be payable on the last day of each 90 day
interval (in the case of Fixed CD Rate Advances or Absolute Rate Advances) or
three-month interval (in the case of Eurocurrency Committed Advances or
Eurocurrency Bid Rate Advances) during such Interest Period. Interest on Fixed
Rate Loans and facility fees hereunder shall be calculated for actual days
elapsed on the basis of a 360-day year. Interest on Floating Rate Loans shall be
calculated for actual days elapsed on the basis of a 365-day year, or, when
applicable, 366-day year. Interest shall be payable for the day an Advance is
made but not for the day of any payment on the amount paid if payment is
received prior to the deadline specified pursuant to Section 2.5.7. If any
payment of principal of or interest on an Advance shall become due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time
shall be included in computing interest in connection with such payment.
2.5.7. Method of Payment. Subject to the last sentence of
Section 2.5.1, all payments of principal, interest, and fees hereunder shall be
made by (i) noon (local time) for each payment in Dollars and (ii) the funding
deadline designated by the Administrative Agent for each payment in an
Alternative Currency (which shall be no earlier than 10:00 a.m. local time in
the place of payment and no later than 12:00 noon (Chicago time)), on the date
Page 30
when due in immediately available funds to the Administrative Agent at the
Administrative Agent's address specified pursuant to Article XIII, or at any
other location specified in writing by the Administrative Agent to the Borrower
and shall be distributed by the Administrative Agent ratably among all Lenders
in the case of fees and payments in respect of Committed Advances and ratably
among the applicable Lenders in respect of Competitive Bid Advances. Each
payment delivered to the Administrative Agent for the account of any Lender
shall be delivered promptly by the Administrative Agent to such Lender in the
same type of funds which the Administrative Agent received at its address
specified pursuant to Article XIII or at any location specified in a notice
received by the Administrative Agent from such Lender. All payments of the
principal of and interest on any Loan shall be made in the currency in which
such Loan is denominated.
2.5.8. Notes. Each Lender is hereby authorized to record on
the schedule attached to each of its Notes, or otherwise record in accordance
with its usual practice, the date and amount of each of its Loans evidenced by
such Note; provided, however, that any failure to so record shall not affect the
Obligors' obligations under any Loan Document.
2.5.9. Notification of Advances, Interest Rates and
Prepayments. The Administrative Agent will notify each Lender of the contents of
each Aggregate Commitment reduction notice, Committed Borrowing Notice,
Conversion/Continuation Notice and repayment notice received by it hereunder
promptly and in any event before the close of business on the same Business Day
of receipt thereof (or, in the case of borrowing notices with respect to
Floating Rate Advances and Absolute Rate Advances, within one hour of receipt
thereof). The Administrative Agent will notify each Lender of the interest rate
applicable to each Fixed Rate Advance promptly upon determination of such
interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate.
2.5.10. Non-Receipt of Funds by the Administrative Agent.
Unless the Borrower or a Lender, as the case may be, notifies the Administrative
Agent prior to the date on which it is scheduled to make payment to the
Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan or
(ii) in the case of the Borrower, a payment of principal, interest or fees to
the Administrative Agent for the account of the Lenders, that it does not intend
to make such scheduled payment, the Administrative Agent may assume that such
Page 31
scheduled payment has been made. The Administrative Agent may, but shall not be
obligated to, make the amount of such scheduled payment available to the
intended recipient in reliance upon such assumption. If such Lender or the
Borrower, as the case may be, has not in fact made such scheduled payment to the
Administrative Agent, the recipient of such scheduled payment shall, on demand
by the Administrative Agent, repay to the Administrative Agent the amount so
made available together with interest thereon in respect of each day during the
period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (x) in the case of scheduled payment by a
Lender, the Federal Funds Effective Rate for such day or (y) in the case of
scheduled payment by the Borrower, the interest rate applicable to the relevant
Loan.
2.5.11. Cancellation. The Company may at any time after the
date hereof cancel the Aggregate Commitment, in whole, or in a minimum aggregate
amount of $10,000,000 (and in integral multiples of $1,000,000 if in excess
thereof) ratably among the Lenders upon written notice to the Administrative
Agent not later than 10:00 a.m. (Chicago time) on the effective date of
cancellation specified therein, which notice shall specify the amount of such
reduction; provided, however, no such notice of cancellation shall be effective
to the extent that it would reduce the Aggregate Commitment to an amount which
would be less than the aggregate Dollar Amount of Loans outstanding at the time
such cancellation is to take effect. Any notice of cancellation given pursuant
to this Section 2.5.11 shall be irrevocable and shall specify the date upon
which such cancellation is to take effect.
2.5.12. Lending Installations. Subject to Section 12.6, each
Lender may, by written (including telex or telecopy) notice to the
Administrative Agent and the Company, book its Loans at any Lending Installation
selected by such Lender and may from time to time change its Lending
Installation and for whose account Loan payments are to be made. Each Lender
will notify the Administrative Agent and the Company on or prior to the date of
this Agreement of the Lending Installation which it intends to utilize for each
type of Loan hereunder.
2.5.13. Currency Equivalents. (a) The Administrative Agent shall
determine the Dollar Amount of each Advance denominated in an Alternative
Currency as of the first day of each Interest Period applicable thereto, and in
the case of any such Interest Period of more than three months, at three month
intervals after the first day thereof, and shall promptly notify the Borrower
and the Lenders of each Dollar Amount so determined by it. Each such
determination shall be based
Page 32
on the spot rate at which in accordance with normal banking procedures the
Administrative Agent could purchase the Alternative Currency with Dollars in the
interbank market in London at 11:00 a.m. (London time) two Business Days prior
to the date as of which such Dollar Amount is to be determined. If after giving
effect to any such determination of a Dollar Amount, the aggregate Dollar Amount
of all outstanding Advances exceeds the Aggregate Commitment, the Borrowers
shall within five Business Days prepay outstanding Advances (as selected by the
Company) to the extent necessary to eliminate such excess; provided that such
prepayment shall be applied to outstanding Committed Advances to the extent
necessary to prepay such Advances in full before prepayment of any Competitive
Bid Advances pursuant to this Section 2.5.13(a).
(b) If for the purpose of obtaining judgment in any court it
is necessary to convert a sum due from any Obligor hereunder or under any of the
Notes in the currency expressed to be payable herein or under the Notes (the
"specified currency") into another currency, the parties hereto agree, to the
fullest extent that they may effectively do so, that the rate of exchange used
shall be that at which in accordance with normal banking procedures the
Administrative Agent could purchase the specified currency with such other
currency at the Administrative Agent's London office at 11:00 a.m. (London time)
on the Business Day preceding that on which final judgment is given. The
obligations of each Obligor in respect of any sum due to any Lender or the
Administrative Agent hereunder or under any Note shall, notwithstanding any
judgment in a currency other than the specified currency, be discharged only to
the extent that on the Business Day following receipt by such Lender or the
Administrative Agent (as the case may be) of any sum adjudged to be so due in
such other currency such Lender or the Administrative Agent (as the case may be)
may in accordance with normal banking procedures purchase the specified currency
with such other currency; if the amount of the specified currency so purchased
is less than the sum originally due to such Lender or the Administrative Agent,
as the case may be, in the specified currency, each Obligor agrees, to the
fullest extent that it may effectively do so, as a separate obligation and
notwithstanding any such judgment, to indemnify such Lender or the
Administrative Agent, as the case may be, against such loss, and if the amount
Page 33
of the specified currency so purchased exceeds (a) the sum originally due to any
Lender or the Administrative Agent, as the case may be, in the specified
currency and (b) any amounts shared with other Lenders as a result of
allocations of such excess as a disproportionate payment to such Lender under
Article XI, such Lender or the Administrative Agent, as the case may be, agrees
to remit such excess to the Company for the account of the Obligors.
2.5.14. Taxes.5.14. (a) Any and all payments by a Borrower
hereunder or under the Notes shall be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto excluding, (i)
in the case of each Lender and Agent, taxes imposed on its income, and franchise
or similar taxes imposed on it, by the jurisdiction under the laws of which such
Lender or Agent is organized or any political subdivision thereof and taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction of
such Lender's applicable Lending Installation or any political subdivision
thereof and (ii) in the case of each Lender, any United States withholding tax
imposed on such payments but only to the extent not attributable to a change in
law, regulation, treaty or interpretation after the time such Lender first
becomes a party to this Agreement (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities arising out of or related to
this Agreement being hereinafter referred to as "Taxes"). If any 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 Lender or Agent, (i) the sum payable shall be
increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.5.14) such Lender or Agent (as the case may be) receives an amount equal to
the sum it would have received had no deductions been made, (ii) such Borrower
shall make such deductions and (iii) such Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law and provide such Lender or Agent (as the case may be) with a
receipt or other evidence of such payment.
(b) In addition, each Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies which arise from any payment made hereunder or under the Notes
or from the execution, delivery, enforcement or registration of, or otherwise
with respect to, the Loan Documents (hereinafter referred to as "Other Taxes").
(c) Each Borrower will indemnify each Lender and Agent for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section
2.5.14) paid by such Lender or Agent and any liability including penalties,
Page 34
interest and expenses arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted by the relevant
taxing authority or other governmental entity. This indemnification shall be
made to the Administrative Agent for the account of such Lender or Agent (as the
case may be) within 30 days from the date such Lender or Agent makes written
demand therefor (with a copy, in the case of a demand by a Lender or the
Documentation Agent, of such demand to the Administrative Agent). If a Lender or
Agent shall become aware that it is entitled to receive a refund in respect of
Taxes or Other Taxes as to which it has been indemnified by a Borrower pursuant
to this Section 2.5.14, it shall promptly notify such Borrower of the
availability of such refund and, unless such Lender or Agent determines in good
faith that it is not in its best interests to do so, shall apply for such
refund. If any Lender or Agent receives a refund in respect of any Taxes or
Other Taxes as to which it has been indemnified by a Borrower pursuant to this
Section 2.5.14, it shall promptly notify such Borrower of such refund and shall
promptly repay such refund to such Borrower (to the extent of amounts that have
been paid by such Borrower under this Section 2.5.14 with respect to such
refund), net of all out-of-pocket expenses of such Lender or Agent in obtaining
such refund; provided that the Borrower, upon the request of such Lender or
Agent agrees to return such refund (plus penalties, interest or other charges)
to such Lender or Agent in the event such Lender or Agent is required to repay
such refund.
(d) Notwithstanding the foregoing, unless, prior to the
initial Borrowing Date (in the case of a Lender listed on the signature pages
hereto), and prior to the effective date of the Assignment and Acceptance by
which it became a Lender (in the case of Lender that became a Lender pursuant to
such Assignment and Acceptance), and in each case from time to time thereafter,
if requested by the Company or the Administrative Agent, each Lender organized
under the laws of a jurisdiction outside the United States shall have provided
the Company and the Administrative Agent with the forms prescribed by the
Internal Revenue Service of the United States certifying as to such Lender's
status for purposes of determining exemption from United States withholding
taxes with respect to all payments of interest to be made to such Lender
hereunder or other documents satisfactory to the Company which, in each case,
shall indicate that all payments to be made to such Lender hereunder are not
subject to United States withholding tax or are subject to such taxes at a rate
Page 35
reduced to zero by an applicable tax treaty, neither the Company nor any other
Borrower shall have any obligation under the last sentence of Section 2.5.14(a)
to make any payments to or for the benefit of such Lender in respect of Taxes
imposed by the United States of America unless such Lender is unable to provide
such form as a result of a change in law or treaty after the time such Lender
becomes a party to this Agreement.
2.5.15. Regulation D Compensation. For so long as any Lender
maintains reserves against "Eurocurrency liabilities" (or any other category of
liabilities which includes deposits by reference to which interest rate on
Eurocurrency Committed Loans is determined or any category of extensions of
credit or other assets which includes loans by a non-United States office of
such Lender to United States residents), and as a result the cost to such Lender
(or its Lending Installation) of making or maintaining any of its Eurocurrency
Committed Loans is increased, then such Lender may require the Borrower to pay,
contemporaneously with each payment of interest on such Loans, additional
interest on the related Eurocurrency Committed Loan of such Lender at a rate per
annum up to but not exceeding the excess of (i)(A) the applicable Eurocurrency
Base Rate divided by (B) one minus the Reserve Requirement over (ii) the
applicable Eurocurrency Base Rate. Any Lender wishing to require payment of such
additional interest (x) shall so notify the Borrower and the Administrative
Agent, in which case such additional interest on the Eurocurrency Committed
Loans of such Lender shall be payable to such Lender at the place indicated in
such notice with respect to each Interest Period which commences at least three
Business Days after the giving of such notice and (y) shall furnish to the
Borrower at least five Business Days prior to each date on which interest is
payable on the Eurocurrency Committed Loans a certificate setting forth the
amount to which such Lender is then entitled under this Section.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1. Yield Protection. If, after the date of this Agreement,
the adoption of any law or the application of any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law), or any change therein, or any change in the
interpretation or administration thereof, or the compliance of any Lender
therewith,
Page 36
(i) with respect to Committed Loans bearing interest at a
Fixed Rate, imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit
extended by, any Lender or any applicable Lending Installation (other
than reserves and assessments taken into account in determining the
interest rate applicable to Committed Advances bearing interest at a
Fixed Rate or for which such Lender is compensated pursuant to Section
2.5.15), or
(ii) with respect to Committed Loans bearing interest at a Fixed
Rate, imposes any other condition,
the result of which is to increase the cost to any Lender or any applicable
Lending Installation of making, funding or maintaining such Loans or reduces any
amount receivable by any Lender or any applicable Lending Installation in
connection with such Loans, or requires any Lender or any applicable Lending
Installation to make any payment calculated by reference to the amount of such
Loans held or interest received by it, by an amount deemed material by such
Lender, then, within 30 days of demand by such Lender, the Borrower shall pay
such Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender reasonably and in good faith determines is
attributable to the making, funding and maintaining of such Loans by it.
3.2. Changes in Capital Adequacy Regulations. If a Lender
reasonably and in good faith determines that the amount of capital required or
expected to be maintained by such Lender, any Lending Installation of such
Lender or any corporation controlling such Lender attributable to this
Agreement, the Loans or its obligation to make Loans hereunder is increased as a
result of a Change (as hereafter defined), then, within 15 days of demand by
such Lender, the Company shall pay such Lender the amount which such Lender
reasonably and in good faith determines is necessary to compensate it for any
reduction in the rate of return on capital to an amount below that which such
Lender could have achieved but for such Change and is attributable to this
Agreement, the Loans or its obligation to make Loans hereunder, provided,
however, that the effect of any Change shall be determined based on the effect
on such Lender that would be applicable to such Lender if such Lender was
Page 37
maintaining the highest credit quality as determined by the applicable
regulatory authorities at the time of such Change. "Change" means (i) any change
after the date of this Agreement in the Risk-Based Capital Guidelines or (ii)
any adoption of or change in any other law, governmental or quasi-governmental
rule, regulation, policy, guideline, interpretation, or directive (whether or
not having the force of law) of general applicability after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or any Lending Installation or any corporation
controlling any Lender (including any determination by any 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, which shall be deemed a Change). "Risk-Based
Capital Guidelines" means (i) the risk-based capital guidelines in effect in the
United States on the date of this Agreement, including transition rules, and
(ii) the corresponding capital regulations promulgated by regulatory authorities
outside the United States implementing the July 1988 report of the Basle
Committee on Banking Regulation and Supervisory Practices Entitled
"International Convergence of Capital Measurements and Capital Standards,"
including transition rules, and any amendments to such regulations adopted prior
to the date of this Agreement.
3.3. Availability of Types of Advances. If the Required
Lenders reasonably and in good faith determine that (i) deposits of a type and
maturity appropriate to match fund Committed Advances bearing interest at a
Fixed Rate are not available or (ii) solely in the case of a Eurocurrency
Committed Advance denominated in an Alternative Currency, the interest
applicable to such Committed Advance does not accurately reflect the funding
cost of such Committed Advance, then the Administrative Agent shall forthwith
give notice thereof to the Company and the Lenders, whereupon until the
Administrative Agent notifies the Company that the circumstances giving rise to
such suspension no longer exist, the obligations of the Lenders to make Fixed CD
Rate Loans or Eurocurrency Loans (in the affected currency), or to convert
outstanding Loans into such Loans or continue outstanding Loans as such Loans
for an additional Interest Period, shall be suspended and (i) any affected
outstanding Committed Advance denominated in Dollars shall be converted into a
Floating Rate Advance on the last day of the then current Interest Period
applicable thereto, (ii) any affected Committed Advance denominated in Dollars
Page 38
for which a Committed Borrowing Notice has previously been given shall instead
be made as a Floating Rate Advance, unless the Borrower elects not to borrow
such Advance by giving one Business Day's notice to the Administrative Agent to
such effect, (iii) any affected outstanding Committed Advance denominated in an
Alternative Currency shall mature and be due and payable on the last day of the
then current Interest Period applicable thereto and (iv) any affected
Eurocurrency Advance denominated in an Alternative Currency for which a
Committed Borrowing Notice or a Competitive Bid Borrowing Notice has previously
been given shall be canceled. Nothing in this Section 3.3 shall affect any right
of the Borrower to borrow or convert outstanding Loans into Loans of a Type not
affected by the circumstances described above under and in accordance with the
other applicable provisions of this Agreement. If any Lender determines that
maintenance of any of its Eurocurrency Loans would violate any applicable law,
rule, regulation or directive, whether or not having the force of law, then such
Lender may by notice to the Company, through the Administrative Agent, require
that such Eurocurrency Loans be converted to an unaffected Type of Loan on the
last day of the then current Interest Period applicable thereto, if such Lender
may lawfully maintain such Loan to such date, or on such earlier date as such
Lender may require if it is not able lawfully to maintain such Loan to such
date.
3.4. Funding Indemnification. If any payment of a Fixed Rate
Loan occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or any Fixed
Rate Loan is converted to a Loan of a different Type on a date which is not the
last day of the applicable Interest Period (except pursuant to the last sentence
of Section 3.3), or the Borrower fails to prepay any Fixed Rate Loan after
notice of prepayment has been given in accordance with Section 2.5.3, or a Fixed
Rate Advance is not made, converted or continued on the date specified by the
Borrower for any reason other than default by the Lenders, the Borrower will
indemnify each Lender for any loss or cost incurred by it resulting therefrom,
including, without limitation, any loss or cost in liquidating or employing
deposits acquired to fund or maintain the Fixed Rate Advance.
3.5. Lender Statements; Limit on Retroactivity; Survival of
Indemnity. To the extent reasonably possible, each Lender shall designate an
alternate Lending Installation with respect to its Fixed Rate Loans to reduce
any liability of the Borrower or the Company to such Lender under Section 3.1,
3.2 or 3.6 or to avoid the unavailability of a Type of Committed Advance under
Section 3.3, so long as such designation is not disadvantageous to such Lender.
Each Lender shall deliver a written statement of such Lender as to the amount
due, if any, under Section 3.1, 3.2, 3.3, 3.4 or 3.6. Such written statement
shall set forth in reasonable detail the calculations upon which such Lender
determined such amount and shall be final, conclusive and binding in the absence
of manifest error. Determination of amounts payable under such Sections in
connection with a Fixed Rate Loan shall be calculated as though each Lender
funded its Fixed Rate Loan through the purchase of a deposit of the type and
Page 39
maturity corresponding to the deposit used as a reference in determining the
Fixed Rate applicable to such Loan, whether in fact that is the case or not. The
Borrower or the Company, as the case may be, shall only be obligated to
compensate any Lender under Section 3.1, 3.2, 3.4 or 3.6 for any amount arising
or accruing during (i) any time or period commencing not more than 90 days prior
to the date on which such Lender notifies the Administrative Agent and the
Company that it proposes to demand such compensation and identifies to the
Administrative Agent and the Company the statute, regulation or other basis upon
which the claimed compensation is or will be based and (ii) any time or period
during which, because of the retroactive application of such statute, regulation
or other such basis, such Lender did not know that such amount would arise or
accrue. Unless otherwise provided herein, the amount specified in the written
statement shall be payable on demand after receipt by the Borrower or the
Company, as the case may be, of the written statement. The obligations of the
Obligors under Sections 3.1, 3.2, 3.4 and 3.6 shall survive payment of any other
of the Obligations and the termination of this Agreement.
3.6. Foreign Subsidiary Costs. If any Lender determines
reasonably and in good faith that the cost to such Lender of making or
maintaining any Loan to an Eligible Subsidiary is increased, or the amount of
any sum received or receivable by any Lender (or its Lending Installation) is
reduced by an amount deemed by such Lender to be material, by reason of the fact
that such Eligible Subsidiary is incorporated in, or conducts business in, a
jurisdiction outside the United States of America, the Company shall indemnify
such Lender for such increased cost or reduction within 30 days after demand by
such Lender (with a copy to the Administrative Agent). A certificate of such
Lender claiming compensation under this Section 3.6 and setting forth the
additional amount or amounts to be paid to it hereunder shall be conclusive in
the absence of manifest error.
3.7. Replacement of Lenders. In the event a Lender (an
"Affected Lender") shall have: (i) failed to either fund its ratable share of
any Committed Advance which such Lender is obligated to fund under the terms of
Section 2.2 or its share of any Competitive Bid Advance which such Lender is
obligated to fund under the terms of Section 2.3, and in either case such
failure has not been cured within five Business Days, (ii) either repudiated its
obligations under this Agreement or failed to reaffirm such obligations in
writing within ten Business Days of a written request therefor from the Company
(with a copy to each Agent), or (iii) made demand for additional amounts
Page 40
pursuant to Sections 2.5.14, 3.1, 3.2 or 3.6, as a result of any condition
described in any such Section, then, unless such Affected Lender has theretofore
taken steps to remove or cure, and has removed or cured within ten Business
Days, such failure or the conditions creating the cause for such demand for such
additional amounts, as the case may be, the Company may require the Affected
Lender to transfer and assign without recourse (in accordance with and subject
to the restrictions contained in Sections 12.1, 12.2 and 12.3) all its
interests, rights and obligations under this Agreement to a bank designated by
the Company and which is reasonably acceptable to the Agents (such bank being
herein called a "Replacement Lender"); provided, that (i) no such assignment
shall conflict with any law, rule or regulation or order of any state, federal
or local governmental authority and (ii) the Replacement Lender shall pay to the
Affected Lender in immediately available funds on the date of such assignment
the principal of and interest accrued to the date of payment on the Loans made
by it hereunder and all other amounts accrued for its account or owed to it
hereunder (including, without limitation, any amount which would be payable
pursuant to Section 3.4 in connection with a prepayment in full of the Loans of
the Affected Lender on the date of such assignment). Each Lender agrees to use
its best efforts to notify the Company as promptly as practicable upon such
Lender's becoming aware that circumstances exist which would cause any Obligor
to become obligated to pay additional amounts to such Lender pursuant to
Sections 2.5.14, 3.1, 3.2 or 3.6.
ARTICLE IV
CONDITIONS PRECEDENT
4.1. Initial Advance. No Lender shall be required to make the initial
Advance hereunder unless the Company has furnished or caused to be
furnished to the Documentation Agent:
(i) Copies of (x) the limited partnership agreement of the
Company, together with all amendments thereto, and (y) the Company's
Certificate of Limited Partnership as filed with the Secretary of State
of Delaware, all certified by a Financial Officer or the President of
the Company.
Page 41
(ii) Copies, certified by a Financial Officer, of the Corporate
General Partner's Certificate of Incorporation, By-Laws and Board of
Directors' resolutions authorizing the execution, delivery and
performance of the Loan Documents on behalf of the Company.
(iii) An incumbency certificate, executed by a Financial Officer,
which shall identify by name and title and bear the signature of the
Financial Officers authorized to sign the Loan Documents and to make
borrowings hereunder, upon which certificate the Lenders shall be
entitled to rely until informed of any change in writing by the
Company.
(iv) Copies of a long-form certificate of the Secretary of State of
the State of Delaware, dated reasonably near the date hereof, listing
the Certificate of Limited Partnership of the Company and each
amendment, if any, thereto, on file in the office of the Secretary of
State of the State of Delaware and stating that such documents are the
only charter documents of the Company on file in the office of the
Secretary of State of the State of Delaware and that the Company is a
limited partnership in good standing in the State of Delaware.
(v) A written opinion of the Company's special counsel, Kirkland &
Ellis, in substantially the form of Exhibit "B-l" hereto.
(vi) A written opinion of the General Counsel to the Company, Vernon
T. Squires, Esq., in substantially the form of Exhibit "B-2" hereto.
(vii) The Notes of the Company payable to the order of each of the
Lenders.
(viii) A certificate, signed by a Financial Officer, (i) stating that
no Default or Unmatured Default has occurred and is continuing and (ii)
setting forth the Pricing Level as at the date of delivery of such
certificate.
(ix) A duly completed Loan/Credit Related Money Transfer
Instruction for the Company in substantially the form of Exhibit "F"
hereto.
(x) A written opinion of Davis Polk & Wardwell, special counsel for
the Agents, in substantially the form of Exhibit "J" hereto.
(xi) Such other documents as the Documentation Agent or its counsel
may have reasonably requested.
Page 42
The Documentation Agent shall promptly notify the other
parties hereto of its receipt of the foregoing documents.
4.2. Initial Advance to each Eligible Subsidiary. No Lender
shall be required to make the initial Advance hereunder to any Eligible
Subsidiary unless such Eligible Subsidiary has furnished or caused to be
furnished to the Documentation Agent:
(i) The Notes of such Eligible Subsidiary payable to the order
of each Lender.
(ii) An opinion of counsel for such Eligible Subsidiary reasonably
acceptable to the Documentation Agent, substantially in the form of
Exhibit "I" hereto and covering such additional matters relating to the
transactions contemplated hereby as the Documentation Agent or the
Required Lenders may reasonably request.
(iii) All documents which the Documentation Agent may reasonably
request relating to the existence of such Eligible Subsidiary, the
corporate or partnership authority for and the validity of the Election
to Participate of such Eligible Subsidiary, this Agreement and the
Notes of such Eligible Subsidiary, and any other matters relevant
thereto, all in form and substance reasonably satisfactory to the
Documentation Agent.
(iv) A duly completed Loan/Credit Related Money Transfer
Instruction for such Eligible Subsidiary in substantially the form of
Exhibit "F" hereto.
The Documentation Agent shall promptly notify the other
parties hereto of its receipt of the foregoing documents.
4.3. Each Advance. No Lender shall be required to make any
Advance (including, without limitation, the initial Advance hereunder), unless
on the applicable Borrowing Date:
(i) Prior to and after giving effect to such Advance there
exists no Default or Unmatured Default.
Page 43
(ii) The representations and warranties of the Company and (if
other than the Company) the Borrower contained in Articles V and XIV of
this Agreement are true and correct in all material respects as of such
Borrowing Date, other than (x) Sections 5.4, 5.5(a) and 5.6, which
representations and warranties are made only as of the date of this
Agreement and (y) in the case of any Committed Advance which does not
result in an increase in the aggregate Dollar Amount of Committed
Advances at the time outstanding, Sections 5.5(b) and 5.7.
(iii) In the case of any Competitive Bid Advance, the
Company's senior unsecured debt without third-party credit enhancement
is rated at least BBB-(Baa3) by at least one of S&P, Moody's or D&P.
Each borrowing of an Advance shall constitute a representation
and warranty by the Company and (if other than the Company) the Borrower that
the conditions contained in Section 4.3(i) and (ii) have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Lenders that:
5.1. Organization and Authority. The Company
(a) prior to the Effective Date of the Reorganization, is a
limited partnership duly organized and validly existing under the laws
of the State of Delaware and on and after the Effective Date of the
Reorganization, will be duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation;
(b) has all requisite power and authority and all necessary
licenses and permits to own and operate its properties and to carry on
its business as now conducted;
(c) is duly licensed or qualified and is in good standing as a
foreign limited partnership (to the extent qualification as a foreign
limited partnership is permitted by statute), or, on and after the
Reorganization, as a foreign corporation, in each jurisdiction wherein
the failure to be so qualified would reasonably be expected to have a
Material Adverse Effect; and
(d) does not believe that the inability of the Company to
qualify as a foreign limited partnership in any state in which such
qualification is not permitted by law will have a Material Adverse
Effect.
Page 44
5.2. Organization and Authority of Subsidiaries. Each Material
Subsidiary:
(a) is a limited partnership, general partnership or
corporation, duly organized, validly existing and, where applicable, in
good standing under the laws of its jurisdiction of incorporation or
the jurisdiction where organized, as the case may be;
(b) has all requisite power and authority and all necessary
licenses and permits to own and operate its properties and to carry on
its business as now conducted; and
(c) is duly licensed or qualified and is in good standing as a
foreign corporation or partnership (to the extent qualification as a
foreign partnership is permitted by statute), as the case may be, in
each jurisdiction wherein the failure to be so qualified would
reasonably be expected to have a Material Adverse Effect.
The Company does not believe that the inability of any Material Subsidiary which
is a partnership to qualify as a foreign partnership in any state in which such
qualification is not permitted by law will have a Material Adverse Effect.
5.3. Organization and Authority of Corporate General
Partner. The Corporate General Partner:
(a) is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware;
(b) has all requisite power and authority and all necessary
licenses and permits to own and operate its properties and to carry on
its business as now conducted; and
(c) is duly licensed or qualified and is in good standing as a
foreign corporation in each jurisdiction wherein the failure to be so
qualified would reasonably be expected to have a Material Adverse
Effect.
5.4. Business and Property. The Lenders have each heretofore
been furnished with a copy of the Annual Report of the Parent on Form 10-K for
the fiscal year ended December 31, 1996 (the "Form 10-K"), the Annual Report to
Page 45
Shareholders of the Parent for the fiscal year ended December 31, 1996 (the
"Annual Report") and the Information Memorandum dated March, 1997 (the
"Information Memorandum") of the Company, which Information Memorandum generally
sets forth the business conducted by the Company and its Subsidiaries and the
principal properties of the Company and its Subsidiaries. The Form 10-K, the
Annual Report, and the Information Memorandum are hereinafter referred to as the
"Disclosure Documents."
5.5. Financial Statements. (a) The consolidated balance sheets
of the Parent and its subsidiaries as of December 31, 1996, and the statements
of income and cash flows for the fiscal year ended on said date accompanied by a
report thereon containing an opinion unqualified as to scope limitations imposed
by the Parent and otherwise without qualification except as therein noted, by
Arthur Andersen LLP, have been prepared in accordance with GAAP consistently
applied except as therein noted, fairly present in all material respects the
financial position of the Company and its Subsidiaries as of such date and the
results of their operations and cash flows for such period.
(b) Since December 31, 1996, no event or condition has occurred which
has had or which would reasonably be expected to have a material adverse effect
on the properties, business, operations or financial condition of the Company
and its Subsidiaries taken as a whole.
5.6. Full Disclosure. The financial statements referred to in
Section 5.5 do not, nor do the Disclosure Documents or any other written
statement furnished by the Parent or any Obligor to the Agents or the Lenders in
connection with the negotiation of the Loan Documents, contain any untrue
statement of a material fact or omit a material fact necessary to make the
statements contained therein or herein not misleading as of the dates thereof.
There is no fact peculiar to the Company or its Subsidiaries which the Company
has not disclosed to the Lenders in writing which materially affects adversely
nor, so far as the Company can foresee, will materially affect adversely the
properties, business, operations or financial condition of the Company and its
Subsidiaries taken as a whole.
5.7. Pending. There are no proceedings pending or, to the
knowledge of the Company threatened, against or affecting the Company, any of
its General Partners, its Parent or any Subsidiary in any court or before any
Page 46
governmental authority or arbitration board or tribunal which would reasonably
be expected to have a Material Adverse Effect. Neither the Company nor any
Subsidiary is in default with respect to any order of any court or governmental
authority or arbitration board or tribunal which would reasonably be expected to
have a Material Adverse Effect.
5.8. Loan Documents are Legal, Valid, Binding and Authorized.
The execution and delivery of the Loan Documents by the Company and compliance
by the Company with all of the provisions of the Loan Documents
(a) are within the power of the Company and have been duly
authorized by proper action on the part of the Company; and
(b) will not violate in any material respect any provisions of
any law or any order of any court or governmental authority or agency
and will not conflict with or result in any breach of any of the terms,
conditions or provisions of, or constitute a default under the limited
partnership agreement of the Company or any indenture or other
agreement or instrument governing Debt or any other material agreement
or instrument to which the Company is a party or by which it may be
bound or result in the imposition of any liens or encumbrances on any
property of the Company.
The execution and delivery by the Company of the Loan Documents and the
performance of its obligations thereunder have been duly authorized by proper
corporate and partnership proceedings, and the Loan Documents constitute legal,
valid and binding obligations of the Company enforceable against the Company in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
5.9. Governmental Consent. No approval, consent or withholding
of objection on the part of any regulatory body, state, Federal or local, is
necessary in connection with the execution, delivery and performance by the
Company of the Loan Documents or compliance by the Company with any of the
provisions of the Loan Documents.
5.10. Taxes. All United States Federal income tax returns and
all other material tax returns required to be filed by the Parent, the Company
or any Subsidiary in any jurisdiction have, in fact, been filed, and all taxes,
and all material assessments, fees and other governmental charges upon the
Parent, the Company or any Subsidiary or upon any of their respective
Page 47
properties, income or franchises, which are shown to be due and payable in such
returns have been paid. The Company does not know of any proposed additional tax
assessment against the Parent, the Company or any Subsidiary for which adequate
provision has not been made on its accounts. To the best of the Company's
knowledge, the provisions for taxes on the books of the Parent, the Company and
each Subsidiary are adequate for all open years, and for its current fiscal
period.
5.11. Employee Retirement Income Security Act of 1974. The
consummation of the transactions provided for in this Agreement and compliance
by the Company with the provisions of the Loan Documents will not involve any
prohibited transaction within the meaning of the ERISA or Section 4975 of the
Code. No "employee pension benefit plans", as defined in ERISA ("Plans"),
maintained by the Company or any Person which is under common control with the
Company within the meaning of Section 4001(b) of ERISA, nor any trusts created
thereunder, have incurred any "accumulated funding deficiency" as defined in
Section 302 of ERISA. Neither the Company nor, to the best of the Company's
knowledge, any Person which is under common control with the Company, within the
meaning of Section 4001(b) of ERISA, maintains any "qualified defined benefit
plan" as defined in ERISA.
5.12. Investment Company Act.12. Investment Company Act.
Neither the Company nor any Subsidiary is an "investment company" or an
"affiliated person" thereof or an "affiliated person" of such affiliated person
as such terms are defined in the Investment Company Act of 1940, as amended.
5.13. Compliance with Environmental Laws. Neither the Company
nor any Subsidiary is in violation of any applicable Federal, state, or local
laws, statutes, rules, regulations or ordinances relating to public health,
safety or the environment, including, without limitation, relating to releases,
discharges, emissions or disposals to air, water, land or ground water, to the
withdrawal or use of ground water, to the use, handling or disposal of
polychlorinated biphenyls (PCB's), asbestos or urea formaldehyde, to the
treatment, storage, disposal or management of hazardous substances (including,
without limitation, petroleum, crude oil or any fraction thereof, or other
hydrocarbons), pollutants or contaminants, to exposure to toxic, hazardous or
other controlled, prohibited or regulated substances which violation would
reasonably be expected to have a Material Adverse Effect.
Page 48
5.14. Regulations U and X. Margin stock (as defined in
Regulations U and X) constitutes less than 25% of those assets of the Company
and its Subsidiaries which are subject to any limitation on sale, pledge, or
other restriction hereunder.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders
shall otherwise consent in writing:
6.1.1. Information. The Company will deliver to each of the
Lenders:
(a) as soon as available and in any event within 120 days
after the end of each fiscal year of the Company, consolidated and
consolidating balance sheets of the Company and its Consolidated
Subsidiaries (subject to Section 6.1.2) as of the end of such fiscal
year and the related consolidated and consolidating statements of
income and cash flows for such fiscal year, setting forth in each case
in comparative form the figures for the previous fiscal year, such
consolidated statements to be reported on in a manner which satisfies
the financial reporting requirements of the Securities and Exchange
Commission by a firm of 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
Company, the internally prepared consolidated and consolidating balance
sheets of the Company and its Consolidated Subsidiaries (subject to
Section 6.1.2) as of the end of such quarter and the related
consolidated and consolidating statements of income and cash flows for
such quarter and for the portion of the Company's fiscal year ended at
the end of such quarter, setting forth in the case of such statements
of income and cash flows in comparative form the figures for the
corresponding quarter and the corresponding portion of the Company's
previous fiscal year, all certified (subject to normal year-end
adjustments and the absence of footnotes) as to fairness of
presentation, GAAP and consistency by a Financial Officer of the
Company;
Page 49
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate of a
Financial Officer of the Company (i) setting forth in reasonable detail
the calculations required to establish whether the Company was in
compliance with the requirements of Sections 6.10, 6.15 and 6.16 on the
date of such financial statements and (ii) stating whether any Default
or Unmatured Default exists on the date of such certificate and, if any
Default or Unmatured Default then exists, setting forth the details
thereof and the action which the Company is taking or proposes to take
with respect thereto;
(d) promptly upon the mailing thereof to the securityholders
of the Parent generally, copies of all financial statements, reports
and proxy statements so mailed;
(e) 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 Company or
the Parent shall have filed with the Securities and Exchange
Commission; and
(f) from time to time such additional information regarding
the financial position or business of the Company and its Subsidiaries
as the Administrative Agent, at the request of any Lender, may
reasonably request.
6.1.2. Use of Parent Information. If the certificate furnished
pursuant to Section 6.1(c) shall state that (i) the financial statements of the
Parent and its subsidiaries fairly present in all material respects the
financial condition of the Company and its Consolidated Subsidiaries for the
period in respect of which such certificate shall be given and (ii) the
consolidated revenue of the Company and its Consolidated Subsidiaries
constitutes at least 98% of the consolidated revenues of the Parent and its
subsidiaries and that the combined assets of the Company and its Consolidated
Subsidiaries constitute at least 98% of the consolidated assets of the Parent
and its subsidiaries, then the Company may furnish consolidated financial
statements of the Parent otherwise complying with the requirements of subsection
(a) or (b) above, as applicable, in lieu of the consolidated financial
statements of the Company specified therein. The consolidating financial
statements required by such subsections shall be prepared in substantially the
same format as those set forth in the Information Memorandum.
Page 50
6.2. Use of Proceeds. The Company will, and will cause each of
its Subsidiaries to, use the proceeds of the Advances for general corporate
purposes, including a distribution by the Company to the Parent in the
approximate amount of $626,000,000 to provide funds to enable the Parent to
repurchase from WMX Technologies, Inc. and its subsidiaries ("WMX") limited
partnership interests in the Parent and options to acquire limited partnership
interests in the Parent held by WMX (the "WMX Repurchase"). The Company will
not, nor will it permit any Subsidiary to, use the proceeds of any Advance in
violation of Regulations U and X.
6.3. Notice of Default. Upon the obtaining of actual knowledge
thereof by a Financial Officer, the Company will, and will cause each of its
Subsidiaries to, give prompt notice in writing to the Administrative Agent of
(i) the occurrence of any Default or Unmatured Default and what actions the
Company proposes to take with respect thereto, if any, and (ii) any other
development, financial or otherwise, which would reasonably be expected to have
a material adverse effect on the properties, business, operations or financial
condition of the Company and its Subsidiaries taken as a whole.
6.4. Inspection. The Company will, and will cause each
Subsidiary to, permit the Lenders, by their respective representatives and
agents, to inspect any of the properties, corporate books and financial records
of the Company and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Company and each Subsidiary, and to
discuss the affairs, finances and accounts of the Company and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Lenders may reasonably designate.
Page 51
6.5. Legal Existence, Etc. The Company will preserve and keep
in force and effect, and will cause each Material Subsidiary to preserve and
keep in force and effect, its legal existence as a limited partnership, general
partnership or as a corporation, as the case may be, and all licenses and
permits necessary to the proper conduct of its business, provided that the
foregoing shall not prevent (x) any transaction permitted by Section 6.14
(including without limitation the Reorganization), (y) the merger or
consolidation of any Eligible Subsidiary with, or the liquidation of any
Eligible Subsidiary into, any other Eligible Subsidiary or, subject to Section
6.14, the Company or (z) the merger or consolidation of any other Material
Subsidiary with or the liquidation of any other Material Subsidiary into any
other Subsidiary or, subject to Section 6.14, the Company.
6.6. Insurance. The Company will maintain, and will cause each
Subsidiary to maintain, insurance coverage by financially sound and reputable
insurers in such forms and amounts and against such risks as are customary for
companies of similar size and financial strength engaged in the same or similar
business activities and owning and operating similar properties.
6.7. Taxes, Claims for Labor and Materials, Compliance with
Laws. The Company will promptly pay and discharge, and will cause each
Subsidiary promptly to pay and discharge all material lawful taxes, assessments
and governmental charges or levies imposed upon the Company or such Subsidiary,
respectively, or upon or in respect of all or any material part of the property
or business of the Company or such Subsidiary, all trade accounts payable in
accordance with usual and customary business terms, and all claims for work,
labor or materials, which if unpaid might become a lien or charge upon any
material property of the Company or such Subsidiary, provided the Company or
such Subsidiary shall not be required to pay any such tax, assessment, charge,
levy, account payable or claim if (i) the validity, applicability or amount
thereof is being contested in good faith by appropriate actions or proceedings
which will prevent the forfeiture or sale of any material property of the
Company or such Subsidiary or any material interference with the use thereof by
the Company or such Subsidiary, and (ii) the Company or such Subsidiary shall
Page 52
set aside on its books, reserves deemed by it to be adequate with respect
thereto. The Company will promptly comply, and will cause each Subsidiary to
comply, in all material respects with all laws, ordinances or governmental rules
and regulations to which it is subject, including without limitation, ERISA, the
Occupational Safety and Health Act of 1970, Federal Insecticide, Fungicide and
Rodenticide Act and Federal Environmental Pesticide Control Act of 1972 and all
laws, ordinances, governmental rules and regulations relating to environmental
protection in all applicable jurisdictions, the violation of which would
reasonably be expected to have a Material Adverse Effect.
6.8. Maintenance, Etc. The Company will maintain, preserve and
keep, and will cause each Subsidiary to maintain, preserve and keep, its
properties which are used in the conduct of its business (whether owned in fee
or a leasehold interest) in good repair and working order and from time to time
will make all necessary repairs, replacements, renewals and additions so that at
all times (in the Company's reasonable judgment) the efficiency thereof shall be
maintained, except where the failure to do so would not reasonably be expected
to have a Material Adverse Effect.
6.9. Nature of Business. Neither the Company nor any
Subsidiary will engage in any business if, as a result, the general nature of
the business, taken on a consolidated basis, which would then be engaged in by
the Company and its Subsidiaries would be substantially changed from the general
nature of the business engaged in by the Company and its Subsidiaries and
described in the Annual Report.
6.10. Restricted Payments. The Company will not make any
Restricted Payment if at the time of such Restricted Payment and after the
giving effect thereto a Default shall have occurred and be continuing. In
addition, the Company will not make any Restricted Payment if after giving
effect thereto the aggregate amount of Restricted Payments made during the
period from and after April 1, 1995 to and including the date of the making of
the Restricted Payment in question would exceed the sum of (i) Consolidated Net
Income for such period, computed on a cumulative basis for such entire period,
(ii) the net proceeds (whether cash or other property, and in the case of other
property, at a value determined by the Company reasonably and in good faith) to
the Company from the issue or sale of Equity Interests in the Company or the
Parent on or after April 1, 1995 and (iii) $100,000,000.
For the purposes of this Section 6.10 the amount of any
Restricted Payment declared, paid or distributed in property of the Company
shall be deemed to be the greater of the book value or fair market value (as
determined in good faith by the Board of Directors) of such property at the time
of the making of the Restricted Payment in question.
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6.11. Payment of Dividends by Subsidiaries. The Company will
not and will not permit any Subsidiary to enter into any agreement which
restricts the ability of any Subsidiary to declare any dividend or to make any
distribution on any Equity Interest of such Subsidiary, other than the
restrictions set forth in Schedule 6.11.
6.12. Transactions with Affiliates..12. Transactions with
Affiliates. The Company will not, and will not permit any Subsidiary to, enter
into or be a party to, any material transaction or arrangement with any
Affiliate (including without limitation, the purchase from, sale to or exchange
of property with, or the rendering of any service by or for, any Affiliate),
except in the ordinary course of and pursuant to the reasonable requirements of
the Company's or such Subsidiary's business and upon fair and reasonable terms
no less favorable to the Company or such Subsidiary than would reasonably be
expected to be obtained in a comparable arm's-length transaction with a Person
other than an Affiliate; provided that the foregoing shall not prevent the
transactions described in the Proxy Statement relating to the Reorganization.
For the purposes of this Section 6.12, the incurrence of Debt which is payable
to the Parent or the Surviving Parent shall not be prohibited so long as such
Debt is permitted pursuant to Section 6.15 and shall have terms which are
comparable to the terms which would reasonably be expected to be obtained in an
arm's-length transaction with a Person other than an Affiliate. It is understood
that the relationship between the Company and the Corporate General Partner
established by the Company's agreement of limited partnership, and the
performance of such agreement by the parties thereto, do not contravene this
Section 6.12.
6.13. Negative Pledge. Neither the Company nor any Subsidiary will
create, assume or suffer to exist any Lien 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;
(b) any Lien existing on any asset of any corporation or other
entity at the time such corporation or other entity becomes a
Subsidiary and not created in contemplation of such event;
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(c) any Lien on any asset securing Debt incurred or assumed
for the purpose of financing all or any part of the cost of acquiring
such asset, provided that such Lien attaches to such asset concurrently
with or within 90 days after the acquisition thereof;
(d) any Lien on any asset of any corporation or other entity
existing at the time such corporation or other entity is merged or
consolidated with or into the Company or a Subsidiary and not created
in contemplation of such event, provided that such Lien does not extend
to any additional assets;
(e) any Lien existing on any asset prior to the acquisition
thereof by the Company or a 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 imposed by any governmental authority for taxes,
assessments or charges not yet due or that are being contested in good
faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of the Company in accordance with
GAAP;
(h) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business that are not overdue for a period of more than 30 days or that
are being contested in good faith and by appropriate proceedings and
Liens securing judgments but only to the extent for an amount and for a
period not resulting in a Default under Section 7.6 hereof;
(i) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(j) deposits to secure the performance of bids, trade
contracts (other than for Debt or Derivatives Obligations), leases,
statutory obligations, surety bonds, appeal bonds with respect to
judgments not exceeding $25,000,000, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
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(k) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and
encumbrances consisting of zoning restrictions, easements, licenses,
restrictions on the use of property or minor imperfections in title
thereto that, in the aggregate, are not material in amount, and that do
not in any case materially detract from the value of the property
subject thereto or interfere with the ordinary conduct of the business
of the Company and its Subsidiaries;
(l) other Liens arising in the ordinary course of its business
which (i) do not secure Debt or Derivatives Obligations, (ii) do not
secure any obligation in an amount exceeding $25,000,000 and (iii) do
not in the aggregate materially detract from the value of its assets or
materially impair the use thereof in the operation of its business;
(m) Liens arising from receivables financings accounted for as
sales under generally accepted accounting principles; provided that the
aggregate unrecovered investment of the purchasers shall at no time
exceed $100,000,000 (plus accrued interest);
(n) 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 $10,000,000;
and
(o) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt in an aggregate principal or face amount at
any date not to exceed $25,000,000.
6.14. Consolidations, Mergers and Sales of Assets. (a) The
Company will not (i) consolidate or merge with or into any other Person or (ii)
sell, lease or otherwise transfer all or substantially all of its assets to any
other Person, provided that the foregoing provisions of this Section 6.14 shall
not preclude (w) consummation of the Reorganization, (x) the liquidation of the
Surviving Company into the Surviving Parent, (y) any merger or consolidation to
which the Company is a party or (z) with the prior written consent of the
Required Lenders, the sale or other transfer of all or substantially all of the
assets of the Company so long as, in the case of each of (w), (x), (y) and (z),
(i) at the time the Surviving Company, in the case of the Reorganization, the
Surviving Parent, in the case of a liquidation of the Surviving Company into it,
the surviving entity, in the case of a merger or consolidation, or the
transferee, in the case of a sale of all or substantially all of the assets of
the Company, is organized under the laws of the United States of America or a
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state thereof and (except in the case of a merger in which the Company is the
surviving entity) expressly assumes all obligations of the Company under the
Loan Documents pursuant to an instrument in form and substance reasonably
satisfactory to the Required Lenders and (ii) after giving effect thereto, no
Default or Unmatured Default shall have occurred and be continuing.
(b) The Company will not sell, lease or otherwise transfer,
directly or indirectly, in any period of four consecutive fiscal quarters assets
having an aggregate net book value greater than 20% of the consolidated total
assets of the Company and its Subsidiaries at the commencement of such period;
provided that this subsection (b) shall not apply to sale or other disposition
in the ordinary course of business of inventory or obsolete equipment.
6.15. Leverage Test. Consolidated Debt shall at no time
exceed the Debt Limit.
6.16. Subsidiary Debt Limitation. The aggregate Debt of
Subsidiaries, exclusive of (i) Debt under this Agreement and the 5-Year
Agreement and (ii) Debt owing to the Company or a Subsidiary, shall at no time
exceed 20% of the Debt Limit.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events
shall constitute a Default:
7.1. Any representation or warranty made or deemed made under
Article IV by any Obligor to the Lenders or the Administrative Agent under or in
connection with this Agreement or any certificate or other document delivered in
connection with this Agreement or any other Loan Document shall be materially
false on the date as of which made or deemed made.
7.2. Nonpayment of principal of any Note when due, or
nonpayment of interest upon any Note or of any facility fee or other obligations
under any of the Loan Documents within five days after the same becomes due.
7.3. The breach by the Company of any of the terms or
provisions of Sections 6.10 through 6.16.
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7.4. The breach by the Company (other than a breach which
constitutes a Default under Section 7.1, 7.2 or 7.3) of any of the terms or
provisions of this Agreement which is not remedied within thirty days after the
earlier of (a) any Financial Officer of the Company having knowledge of such
breach or (b) written notice from the Administrative Agent or any Lender.
7.5. Default by the Company or any Subsidiary in the payment
of the principal of or interest on any Debt and/or Derivatives Obligations in an
aggregate amount of $25,000,000 or more, as and when the same shall become due
and payable by the lapse of time, by declaration, by call for redemption or
otherwise, and such default shall continue beyond the period of grace, if any,
allowed with respect thereto.
7.6. Default or the happening of any event shall occur under
any indenture, agreement, or other instrument under which any Material
Commitment is made or any Debt of the Company or any Subsidiary in an aggregate
amount of $25,000,000 or more is outstanding and such default or event shall
continue for a period of time sufficient to permit the acceleration of the
maturity of any Debt of the Company or any Subsidiary outstanding thereunder or
to permit termination of any Material Commitment, provided any such default
which exists solely on account of the Reorganization shall not constitute a
Default or Unmatured Default under this Section 7.6 once such default shall have
been waived by the holders of such Debt or the makers of such Material
Commitment.
7.7. The Corporate General Partner shall withdraw from the
Company (except in connection with the Reorganization) and no successor
Corporate General Partner shall have been elected prior thereto or substantially
simultaneously therewith in accordance with Section 12.1 of the limited
partnership agreement of the Company.
7.8. A custodian, trustee or receiver is appointed for the
Company, the Corporate General Partner or any Material Subsidiary or for the
major part of the property of any of the foregoing and is not discharged within
30 days after such appointment.
7.9. Final judgment or judgments for the payment of money
aggregating in excess of $25,000,000 is or are outstanding against the Company
or any Subsidiary and such judgments have remained unpaid, unvacated, unbonded
or unstayed by appeal or otherwise for a period of 30 days.
7.10. The Company, the Corporate General Partner or any
Material Subsidiary becomes insolvent or bankrupt, is generally not paying its
debts as they become due or makes an assignment for the benefit of creditors, or
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the Company, the Corporate General Partner or any Material Subsidiary causes or
suffers an order for relief to be entered with respect to it under applicable
Federal bankruptcy law or applies for or consents to the appointment of a
custodian, trustee or receiver for the Company, the Corporate General Partner or
such Material Subsidiary or for the major part of the property of any of the
foregoing.
7.11. Bankruptcy, reorganization, arrangement or insolvency
proceedings, or other proceedings for relief under any bankruptcy or similar law
or laws for the relief of debtors, are instituted by or against the Company, the
Corporate General Partner or any Material Subsidiary, and, if instituted against
the Company, the Corporate General Partner or any Material Subsidiary, are
consented to or are not dismissed within 60 days after such institution.
7.12. Any Change of Control shall occur.
7.13. The Guaranty of the Company under Article XV shall cease
to be in full force and effect or the Company shall contest in any manner the
validity, binding nature or enforceability of Article XV, in either case at a
time when any Loans are outstanding hereunder to an Eligible Subsidiary.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration. If any Default described in Section 7.8,
7.10 or 7.11 occurs with respect to the Company, the obligations of the Lenders
to make Loans hereunder shall automatically terminate and the Obligations shall
immediately become due and payable without presentment, demand, protest or
notice of any kind (all of which the Company hereby expressly waives) or any
other election or action on the part of the Administrative Agent or any Lender.
If any other Default occurs, the Required Lenders may terminate or suspend the
obligations of the Lenders to make Loans hereunder, or declare the Obligations
to be due and payable, or both, in either case upon written notice to the
Company, whereupon the Obligations shall become immediately due and payable,
without presentment, demand, protest or further notice of any kind, all of which
each Obligor hereby expressly waives.
8.2. Amendments. Subject to the provisions of this Article
VIII, the Loan Documents may be amended to add or modify any provisions thereof
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or change in any manner the rights of the Lenders or the Obligors thereunder or
waive any Default thereunder, but only in a writing signed by the Required
Lenders (or the Documentation Agent with the consent in writing of the Required
Lenders) and the Company; provided, however, that no such supplemental agreement
shall, without the consent of each Lender affected thereby:
(i) Extend the maturity of any Loan or Note or reduce the
principal amount thereof, or reduce the rate or extend the
time of payment of interest thereon or fees under Section 2.4.
(ii) Change the percentage of the Commitments or the aggregate
unpaid principal amount, or the number of Lenders, which shall
be required for the Lenders or any of them to take any action
under this Section 8.2 or any other provision (including any
definition) of this Agreement.
(iii) Extend the Termination Date or increase the amount of the
Commitment of any Lender hereunder, or permit any Borrower to
assign its rights or obligations under this Agreement except
in connection with the Reorganization and in compliance with
the terms of Section 6.5 and 6.14.
(iv) Amend Section 2.5.13(a), Section 8.1 or this Section 8.2.
(v) Release the Company from its obligations under Article XV.
No amendment of any provision of this Agreement relating to either Agent shall
be effective without the written consent of such Agent. The Administrative Agent
may waive payment of the fee required under Section 12.3.2 without obtaining the
consent of any of the Lenders. No amendment shall, unless signed by an Eligible
Subsidiary, (w) subject such Eligible Subsidiary to any additional obligation,
(x) increase the principal of or rate of interest on any outstanding Loan of
such Eligible Subsidiary, (y) accelerate the stated maturity of any outstanding
Loan of such Eligible Subsidiary or (z) change this proviso.
8.3. Preservation of Rights. No delay or omission of any
Lender or Agent to exercise any right under the Loan Documents shall impair such
right or be construed to be a waiver of any Default or an acquiescence therein,
and the making of a Loan notwithstanding the existence of a Default or the
inability of the Borrower to satisfy the conditions precedent to such Loan shall
not constitute any waiver or acquiescence. Any single or partial exercise of any
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such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Agents and the Lenders until the Obligations have been paid in
full.
ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and
warranties of the Obligors contained in this Agreement shall survive delivery of
the Notes and the making of the Loans herein contemplated.
9.2. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of
any of the provisions of the Loan Documents.
9.3. Entire Agreement. The Loan Documents embody the entire
agreement and understanding among the Obligors, the Agents and the Lenders and
supersede all prior agreements and understandings among the Obligors, the Agents
and the Lenders relating to the subject matter thereof except as contemplated in
Section 10.12.
9.4. Several Obligations. The respective obligations of the
Lenders hereunder are several and not joint and no Lender shall be the partner
or agent of any other (except to the extent to which either Agent is authorized
to act as such). The failure of any Lender to perform any of its obligations
hereunder shall not relieve any other Lender from any of its obligations
hereunder. No Lender shall have any liability for the failure of any other
Lender to perform its obligations hereunder. This Agreement shall not be
construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and assigns.
9.5. Expenses; Indemnification. (a) The Company shall
reimburse (i) the Agents for any reasonable costs, internal charges and
out-of-pocket expenses (including reasonable attorneys' fees of Davis Polk &
Wardwell, special counsel for the Agents) paid or incurred by either Agent in
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connection with the preparation, review, execution, delivery, amendment,
modification and administration of the Loan Document and (ii) the Agents and the
Lenders for any reasonable costs, internal charges and out-of-pocket expenses
(including reasonable attorneys' fees and allocated costs of inside counsel for
the Agents and the Lenders) paid or incurred by either Agent or any Lender in
connection with the collection and enforcement of the Loan Documents, any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or any insolvency or bankruptcy
proceedings in respect of any Obligor.
(b) The Company further agrees to indemnify each Agent and
each Lender, their respective affiliates, and the respective directors,
officers, employees and agents of the foregoing, against all losses, claims,
damages, penalties, judgments, liabilities and expenses (including, without
limitation, all expenses of litigation or preparation therefor whether or not
the Agent or any Lender is a party thereto) (collectively, the "Indemnified
Amounts") which any of them may pay or incur arising out of or relating to this
Agreement, the other Loan Documents, the transactions contemplated hereby or the
direct or indirect application or proposed application of the proceeds of any
Loan hereunder; provided that it is understood that the Company shall not, in
respect of the legal expenses of the Lenders in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all Lenders designated by the Agents (except if and to the extent that, owing to
existing or potential conflicts of interest among them, such counsel shall
advise that representation of all Lenders by a single firm would not be
appropriate); and provided, further, that the Company shall not be liable to any
Lender for any Indemnified Amounts (x) resulting from the gross negligence or
willful misconduct of such Lender, its affiliates or any of their respective
officers, directors, employees and agents or (y) constituting the costs and
expenses of prosecuting a suit or proceeding commenced by such Lender which is
finally determined adversely to such Lender (any counterclaim asserted against
such Lender being treated as a separate proceeding for this purpose). The
obligations of the Company under this Section 9.5 shall survive the termination
of this Agreement.
9.6. Numbers of Documents. All statements, notices, closing
documents, and requests hereunder shall be furnished to the Agent with
sufficient counterparts so that the Agents may furnish one to each of the
Lenders.
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9.7. Severability of Provisions. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.8. Nonliability of Lenders. The relationship between the
Obligors and the Lenders and the Agents shall be solely that of debtor and
creditor. Neither Agent nor any Lender shall have any fiduciary responsibilities
to any Obligor. Neither Agent nor any Lender undertakes any responsibility to
any Obligor to review or inform any Obligor of any matter in connection with any
phase of its business or operations.
9.9. Choice of Law. The loan documents shall be governed by
and construed in accordance with the internal laws (and not the law of
conflicts) of the State of New York.
9.10. Consent to Jurisdiction. Each obligor hereby irrevocably
submits to the non-exclusive jurisdiction of any United States Federal or New
York State Court sitting in New York City in any action or proceeding arising
out of or relating to any loan documents and each obligor hereby irrevocably
agrees that all claims in respect of such action or proceeding may be heard and
determined in any such court and irrevocably waives to the extent allowed by law
any objection it may now or hereafter have as to the venue of any such suit,
action or proceeding brought in such a court or that such court is an
inconvenient forum. Nothing herein shall limit the right of either agent or any
lender to bring proceedings against any obligor in the courts of any other
jurisdiction. Any judicial proceeding by any obligor against either agent or any
lender or any affiliate of either agent or any lender involving, directly or
indirectly, any matter in any way arising out of, related to, or connected with
any loan document shall be brought only in a court in New York City, unless such
obligor is unable to obtain such jurisdiction.
9.11. Waiver of Jury Trial. Each obligor, agent and lender
hereby waives to the extent allowed by law trial by jury in any judicial
proceeding involving, directly or indirectly, any matter (whether sounding in
tort, contract or otherwise) in any way arising out of, related to, or connected
with any loan document or the relationship established thereunder.
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9.12. Confidentiality. Each Lender agrees to hold any
confidential information which it may receive from the Parent, the Company or
any of its Subsidiaries pursuant to this Agreement in confidence, except for
disclosure (i) to other Lenders and their respective Affiliates, (ii) to legal
counsel, accountants, and other professional advisors to that Lender, (iii) to
regulatory officials upon their request or otherwise pursuant to law or
regulation, (iv) as requested pursuant to or as required by law, regulation, or
legal process, (v) in connection with any legal proceeding to which that Lender
is a party, and (vi) permitted by Section 12.4. The restrictions in this Section
9.12 shall not apply to any information which is or becomes generally available
to the public other than as a result of disclosure by a Lender or a Lender's
representatives.
ARTICLE X
THE AGENTS
10.1. Appointment. First Chicago and Morgan are hereby
appointed Administrative Agent and Documentation Agent, respectively, hereunder
and under each other Loan Document, and each of the Lenders irrevocably
authorizes each such Agent to act as the contractual representative of such
Lender. Each such Agent agrees to act as such upon the express conditions
contained in this Article X. Neither Agent shall have a fiduciary relationship
in respect of any Lender by reason of this Agreement.
10.2. Powers. Each Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to such Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto. Neither Agent shall have any implied duties to the Lenders, or any
obligation to the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by such Agent.
10.3. General Immunity. Neither Agent nor any of its
affiliates nor any of their respective directors, officers, agents or employees
shall be liable to any Obligor or any Lender for any action taken or omitted to
be taken by it or them in their respective agency capacities under or in
connection with this Agreement except for its own gross negligence or willful
misconduct.
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10.4. No Responsibility for Loans, Recitals, etc. Neither
Agent nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into, or verify (i) any statement, warranty or representation made in
connection with any Loan Document or any borrowing hereunder; (ii) the
performance or observance of any of the covenants or agreements of any Obligor
under any Loan Document; (iii) the satisfaction of any condition specified in
Article IV, except receipt of items required to be delivered to such Agent; or
(iv) the validity, effectiveness or genuineness of any Loan Document or any
other instrument or writing furnished in connection therewith, except for the
authority of such Agent's signatory to this Agreement.
10.5. Action on Instructions of Lenders. Each Agent shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
and under any other Loan Document in accordance with written instructions signed
by the Required Lenders (or, where so specified herein, all the Lenders), and
such instructions and any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders and on all holders of Notes. Each Agent shall
be fully justified in failing or refusing to take any action hereunder and under
any other Loan Document unless it shall first be indemnified to its satisfaction
by the Lenders pro rata against any and all liability, cost and expense that it
may incur by reason of taking or continuing to take any such action, provided
that, such indemnity need not include liability, costs and expenses arising
solely from the gross negligence or willful misconduct of the Agent.
10.6. Employment of Agents and Counsel. Each Agent may execute
any of its duties as Agent hereunder and under any other Loan Document by or
through employees, agents, and attorneys-in-fact and shall not be answerable to
the Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. Each Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.
10.7. Reliance on Documents; Counsel. Each Agent shall be
entitled to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
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to legal matters, upon the opinion of counsel selected in good faith by such
Agent, which counsel may be employees of such Agent or may be counsel for an
Obligor.
10.8. Agent's Reimbursement and Indemnification. The Lenders
agree to reimburse and indemnify each Agent ratably in proportion to their
respective Commitments (i) for any amounts not reimbursed by the Company for
which such Agent is entitled to reimbursement by the Company under the Loan
Documents, (ii) for any other expenses not reimbursed by the Company incurred by
such Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents and
(iii) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever and not reimbursed by the Company which may be imposed on, incurred
by or asserted against such Agent in any way relating to or arising out of the
Loan Documents or any other document delivered in connection therewith or the
transactions contemplated thereby, or the enforcement of any of the terms
thereof or of any such other documents, provided that no Lender shall be liable
for any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of such Agent.
10.9. Rights as a Lender. With respect to its Commitment,
Loans made by it and the Notes issued to it, each Agent shall have the same
rights and powers hereunder and under any other Loan Document as any Lender and
may exercise the same as though it were not an Agent, and the term "Lender" or
"Lenders" shall, unless the context otherwise indicates, include each Agent in
its individual capacity. Each Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Company or any of its Subsidiaries.
10.10. Lender Credit Decision. Each Lender acknowledges that
it has, independently and without reliance upon either Agent or any other Lender
and based on the financial statements submitted by the Company and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and the other Loan Documents.
Each Lender also acknowledges that it will, independently and without reliance
upon either Agent or any other Lender 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 action under this Agreement and the
other Loan Documents.
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10.11. Successor Agent. Each Agent may resign at any time by
giving at least 30 days' prior written notice thereof to the Lenders and the
Company and such resignation shall be effective upon the appointment of a
successor agent. Upon any such resignation, the Company, with the approval of
the Required Lenders, shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed and approved and shall have
accepted such appointment within thirty days after the retiring Agent's giving
notice of resignation, then the retiring Agent may appoint a successor Agent.
Such successor Agent shall be a commercial bank with an office located in the
United States of America having capital and retained earnings of at least
$1,000,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent.
The retiring Agent shall be discharged from its duties and obligations hereunder
and under the other Loan Documents upon the effectiveness of its resignation
hereunder. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article X shall continue in effect for its benefit in respect
of any actions taken or omitted to be taken by it while it was acting as Agent
hereunder and under the other Loan Documents.
10.12. Agents' Fees. The Company hereby agrees to pay to each Agent
for its sole account such fees as heretofore agreed upon by the Company and
such Agent in writing.
ARTICLE XI
SETOFF RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation of, any
rights of the Lenders under applicable law, if any Obligor becomes insolvent,
however evidenced, or any Default occurs, any indebtedness from any Lender to
any Obligor (including all account balances, whether provisional or final and
whether or not collected or available) may be offset and applied toward the
payment of the Obligations owing by such Obligor to such Lender, whether or not
such Obligations, or any part hereof, shall then be due.
Page 67
11.2. Ratable Payments. If any Lender, whether by setoff or
otherwise, has payment made to it upon its share of any Advance (other than
payments received pursuant to Article III) in a greater proportion than that
received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Loans comprising that Advance held by the other
Lenders so that after such purchase each Lender will hold its ratable proportion
of the unpaid Loans comprising that Advance. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their Loans. In case any such payment is
disturbed by legal process, or otherwise, appropriate further adjustments shall
be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns. The terms and provisions of the
Loan Documents shall be binding upon and inure to the benefit of the Obligors,
the Agents and the Lenders and their respective successors and assigns, except
that (i) no Obligor shall have the right to assign its rights or obligations
under the Loan Documents (except in a transaction expressly permitted by Section
6.5 or 6.14(a)) and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (ii) of this Section, any Lender may
at any time, without the consent of any Obligor or either Agent, assign all or
any portion of its rights under this Agreement and its Notes to a Federal
Reserve Bank; provided, however, that no such assignment shall release the
transferor Lender from its obligations hereunder. Each Agent may treat the payee
of any Note as the owner thereof for all purposes hereof unless and until such
payee complies with Section 12.3 in the case of an assignment thereof or, in the
case of any other transfer, a written notice of the transfer is filed with each
Agent. Any assignee or transferee of a Note agrees by acceptance thereof to be
bound by all the terms and provisions of the Loan Documents. Any request,
authority or consent of any Person, who at the time of making such request or
giving such authority or consent is the holder of any Note, shall be conclusive
and binding on any subsequent holder, transferee or assignee of such Note or of
any Note or Notes issued in exchange therefor.
Page 68
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law, at any
time sell to one or more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Note held by such Lender, the
Commitment of such Lender, or any other interest of such Lender under the Loan
Documents; provided, however, that, except in the case (i) of a sale of a
participation in a Competitive Bid Loan or (ii) a sale of a Participation to any
other Lender, such participations shall require the consent of the Company and
shall each be in a minimum amount of $5,000,000. In the event of any such sale
by a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, such Lender shall remain the holder of any such Note for all
purposes under the Loan Documents, all amounts payable by the Obligors under
this Agreement shall be determined as if such Lender had not sold such
participating interests, and the Obligors and the Agents shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole right
to approve, without the consent of any Participant, any amendment, modification
or waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Loan or Commitment in which such
Participant has an interest which forgives principal, interest or fees or
reduces the interest rate or fees payable with respect to any such Loan or
Commitment, postpones any date fixed for any regularly-scheduled payment of
principal of, or interest or fees on, any such Loan or Commitment, releases any
guarantor of any such Loan, if any, or releases any substantial portion of
collateral, if any, securing any such Loan.
Page 69
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may, in the ordinary
course of its business and in accordance with applicable law, at any time assign
to one or more banks or other entities ("Purchasers") all or a portion (if such
Purchaser is not a Lender immediately before such assignment, in a minimum
amount of $10,000,000) of its rights and obligations under the Loan Documents.
Such assignment shall be substantially in the form of Exhibit "E" hereto. The
consent of the Company and the Agents shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not both a financial
institution and an affiliate of the transferor. Such consents shall be given in
substantially the form attached as Exhibit "II" to Exhibit "E" hereto.
12.3.2. Effect; Effective Date. Upon (i) delivery to the
Company and the Agents of a notice of assignment, substantially in the form
attached as Exhibit "I" to Exhibit "E" hereto (a "Notice of Assignment"),
together with any consent required by Section 12.3.1, and (ii) payment of a
$3,500 fee to the Administrative Agent by the assignee or assignor Lender for
processing such assignment, such assignment shall become effective on the
effective date specified in such Notice of Assignment. On and after the
effective date of such assignment, such Purchaser shall for all purposes be a
Lender party to this Agreement and any other Loan Document executed by the
Lenders and shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto, and no
further consent or action by the Obligors, the Lenders or the Agents shall be
required to release the transferor Lender with respect to the percentage of the
Aggregate Commitment and Loans assigned to such Purchaser. Upon the consummation
of any assignment to a Purchaser pursuant to this Section 12.3.2, the transferor
Lender, the Agents and the Obligors shall make appropriate arrangements so that
replacement Notes are issued to such transferor Lender and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in each case in
principal amounts reflecting their respective Commitments, as adjusted pursuant
to such assignment.
12.4. Dissemination of Information. The Obligors authorize
each Lender to disclose to any Participant or Purchaser or any other Person
acquiring an interest in the Loan Documents by operation of law (each a
"Transferee") and any prospective Transferee any and all information in such
Page 70
Lender's possession concerning the creditworthiness of the Company and its
Subsidiaries; provided that each Transferee and prospective Transferee agrees to
be bound by Section 9.12 of this Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is
transferred to any Purchaser which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Purchaser, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 2.5.14.
12.6. Increased Costs. Subject to the applicable limitations
set forth therein and to the further provisions of this Section 12.6, each
Transferee shall be entitled to the benefits of Section 2.5.14 and 2.5.15 and
Article III with respect to the rights transferred to it to the same extent as a
Lender. No Transferee (including, for purposes of this Section 12.6, any
successor Lending Installation) of any Lender's rights shall be entitled to
receive any greater payment under Section 2.5.14 or Article III than such Lender
would have been entitled to receive with respect to the rights transferred,
unless such transfer is made with the Company's prior written consent or by
reason of the provisions of Section 3.4 requiring such Lender to designate a
different Lending Installation under certain circumstances or at a time when the
circumstances giving rise to such greater payment did not exist.
ARTICLE XIII
NOTICES
13.1. Giving Notice. All notices and other communications
provided to any party hereto under this Agreement or any other Loan Document
shall be in writing (including telex or facsimile) and addressed or delivered to
such party: (a) in the case of the Company or either Agent, at its address,
facsimile number or telex number set forth on the signature pages hereof, (b) in
the case of any Lender, at its address, facsimile number or telex number set
forth in its Administrative Questionnaire, (c) in the case of any Eligible
Subsidiary, to it care of the Company and (d) in the case of any party, such
other address, facsimile number or telex number as such party may hereafter
specify for the purpose by notice to the Agents and the Company. All such
notices shall be effective when received at the address specified above.
Page 71
ARTICLE XIV
REPRESENTATIONS AND WARRANTIES
OF ELIGIBLE SUBSIDIARIES
Each Eligible Subsidiary shall be deemed by the execution and
delivery of its Election to Participate to have represented and warranted that:
14.1. Existence and Power. It is duly organized, validly
existing and in good standing under the laws of its jurisdiction of organization
and is a Subsidiary of the Company.
14.2. Corporate or Partnership and Governmental Authorization;
Contravention. The execution and delivery by it of its Election to Participate
and its Notes, and the performance by it of this Agreement and its Notes, are
within its legal powers, have been duly authorized by all necessary corporate,
partnership or other legal 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, in any material respect any provision of applicable
law or regulation or of its organizational documents or of any indenture or
other agreement or instrument governing Debt or any other material agreement or
instrument binding upon the Company or such Eligible Subsidiary or result in the
creation or imposition of any liens or encumbrances on any asset of the Company
or any of its Subsidiaries.
14.3. Binding Effect. This Agreement constitutes a legal,
valid and binding agreement of such Eligible Subsidiary and each of its Notes,
when executed and delivered in accordance with this Agreement, will constitute a
legal, valid and binding obligation of such Eligible Subsidiary, in each case
enforceable in accordance with its terms except as enforceability may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally.
14.4. Taxes. Except as disclosed in such Election to
Participate, there is no income, stamp or other tax of any country, or any
taxing authority thereof or therein, imposed by or in the nature of withholding
or otherwise, which is imposed on any payment to be made by such Eligible
Subsidiary pursuant hereto or on its Notes, or is imposed on or by virtue of the
execution, delivery or enforcement of its Election to Participate or of its
Notes.
Page 72
ARTICLE XV
GUARANTY
15.1. The Guaranty. The Company hereby unconditionally
guarantees the full and punctual payment (whether at stated maturity, upon
acceleration or otherwise) of the principal of and interest on each Note issued
by any Eligible Subsidiary pursuant to this Agreement, and the full and punctual
payment of all other amounts payable by any Eligible Subsidiary under this
Agreement. Upon failure by any Eligible Subsidiary to pay punctually any such
amount, the Company shall forthwith on demand pay the amount not so paid at the
place and in the manner specified in this Agreement.
15.2. Guaranty Unconditional. The obligations of the Company
hereunder shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of any Eligible Subsidiary under
this Agreement or any Note, by operation of law or otherwise;
(ii) any modification or amendment of or supplement to this
Agreement or any Note;
(iii) any release, impairment, non-perfection or invalidity of any
direct or indirect security for any obligation of any Eligible
Subsidiary under this Agreement or any Note;
(iv) any change in the corporate existence, structure or ownership
of any Eligible Subsidiary, or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting any Eligible
Subsidiary or its assets or any resulting release or discharge of any
obligation of any Eligible Subsidiary contained in this Agreement or
any Note;
(v) the existence of any claim, set-off or other rights which
the Company may have at any time against any Eligible Subsidiary,
either Agent, any Lender or any other Person, whether in connection
herewith or any unrelated transactions, provided that nothing herein
shall prevent the assertion of any such claim by separate suit or
compulsory counterclaim;
Page 73
(vi) any invalidity or unenforceability relating to or against any
Eligible Subsidiary for any reason of this Agreement or any Note, or
any provision of applicable law or regulation purporting to prohibit
the payment by any Eligible Subsidiary of the principal of or interest
on any Note or any other amount payable by it under this Agreement; or
(vii) any other act or omission to act or delay of any kind by any
Eligible Subsidiary, either Agent, any Lender or any other Person or
any other circumstance whatsoever which might, but for the provisions
of this paragraph, constitute a legal or equitable discharge of or
defense to the Company's obligations hereunder.
15.3. Discharge Only Upon Payment In Full; Reinstatement In
Certain Circumstances. The Company's obligations hereunder shall remain in full
force and effect until the Commitments shall have terminated and the principal
of and interest on the Notes and all other amounts payable by the Company and
each Eligible Subsidiary under this Agreement shall have been paid in full. If
at any time any payment of principal of or interest on any Note or any other
amount payable by any Eligible Subsidiary under this Agreement is rescinded or
must be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of any Eligible Subsidiary or otherwise, the Company's
obligations hereunder with respect to such payment shall be reinstated at such
time as though such payment had been due but not made at such time.
15.4. Waiver by the Company. The Company irrevocably waives
acceptance hereof, presentment, demand, protest and any notice not provided for
herein, as well as any requirement that at any time any action be taken by any
Person against any Eligible Subsidiary or any other Person.
15.5. Subrogation. Upon making any payment with respect to any
Eligible Subsidiary hereunder, the Company shall be subrogated to the rights of
the payee against such Eligible Subsidiary with respect to such payment;
provided that the Company shall not enforce any payment by way of subrogation
until all amounts of principal of and interest on the Notes and all other
amounts payable by such Eligible Subsidiary under this Agreement have been paid
in full.
Page 74
15.6. Stay of Acceleration. In the event that acceleration of
the time for payment of any amount payable by any Eligible Subsidiary under this
Agreement or its Notes is stayed upon insolvency, bankruptcy or reorganization
of such Eligible Subsidiary, all such amounts otherwise subject to acceleration
under the terms of this Agreement shall nonetheless be payable by the Company
hereunder forthwith on demand by the Required Lenders.
ARTICLE XVI
COUNTERPARTS; EFFECTIVENESS
This Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one agreement, and any of the
parties hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when the Documentation Agent shall have received
evidence reasonably satisfactory to it that (i) this Agreement has been executed
by the Company, the Agents and the Lenders and (ii) the commitments of the
lenders parties to the Credit Agreement dated as of August 31, 1995 and amended
and restated as of October 15, 1996 among the Company, such lenders and First
Chicago, as administrative agent, and Morgan, as documentation agent (the "Prior
Agreement") shall have terminated and all loans outstanding thereunder and all
accrued interest and fees thereunder shall have been paid in full; provided that
(x) any "Competitive Bid Loan" made by a Lender pursuant to the Prior Agreement
which is outstanding at the time the other conditions to the effectiveness
hereof are satisfied shall remain outstanding on the terms applicable thereto
under the Prior Agreement, and shall be deemed a Competitive Bid Loan made
hereunder on such terms and (y) the Company and the Lenders comprising the
Required Lenders (as defined in the Prior Agreement) hereby agree that the
Commitments (as defined in the Prior Agreement) shall terminate automatically
upon the satisfaction of all other conditions to effectiveness of this
Agreement, without requirement of notice under the Prior Agreement or any other
action by any party hereto or thereto.
Page 75
IN WITNESS WHEREOF, the Company, the Lenders and the Agents
have executed this Agreement as of the date first above written.
THE SERVICEMASTER COMPANY LIMITED
PARTNERSHIP
By: ServiceMaster Management Corporation,
its General Partner
By:/s/ Eric P. Zarnikow
Title:Vice President and Treasurer
Address: One ServiceMaster Way
Downers Grove, IL 60515-1700
Attention: Mr. Eric Zarnikow
Telephone: (630) 271-2361
Facsimile: (630) 271-5604
Page 76
Commitment
- ----------
$37,500,000 THE FIRST NATIONAL BANK OF CHICAGO,
individually and as Administrative
Agent
By:/s/ Patricia H. Besser
Title:Vice President/Senior Corporate Banker
Address: One First National Plaza
Suite 0324
Chicago, IL 60670
Attention: Patricia H. Besser
Telephone: (312) 732-7703
Facsimile: (312) 732-5296
Page 77
$37,500,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, individually and as
Documentation Agent
By:/s/ Charles H. King
Title:Vice President
Address: 60 Wall Street
New York, NY 10260-0060
Attention: Charles King
Telephone: (212) 648-7138
Facsimile: (212) 648-5336
Page 78
$25,000,000 BANK OF AMERICA ILLINOIS
By:/s/ William F. Sweeney
Title:Vice President
Address: 231 S. LaSalle Street
Chicago, IL 60697
Attention: William F. Sweeney
Telephone: (312) 828-1843
Facsimile: (312) 987-1276
Page 79
$18,125,000 BANK OF MONTREAL
By:/s/ Peter W. Steelman
Title:Director
Address: 115 S. LaSalle. 13 West
Chicago, IL 60603
Attention: Peter W. Steelman
Telephone: (312) 750-3812
Facsimile: (312) 750-3783
Page 80
$18,125,000 THE BANK OF NEW YORK
By:/s/ John M. Lokay, Jr.
Title:Vice President
Address: One Wall Street
New York, NY 10286
Attention: John M. Lokay, Jr.
Telephone: (212) 635-1172
Facsimile: (212) 635-1208/9
Page 81
$18,125,000 CAISSE NATIONALE DE CREDIT AGRICOLE
By:/s/ Dean Balice
Title:Senior Vice President Branch Manager
Address:55 East Monroe Street
Chicago, IL 60603-5702
Attention: Dean Balice
Telephone: (312) 917-7449
Facsimile: (312) 372-2830
Page 82
$14,375,000 CREDIT LYONNAIS CHICAGO BRANCH
By:/s/ Mary Ann Klemm
Title:Vice President
Address: 227 West Monroe Street
Chicago, IL 60606
Attention: Michael Lord
Assistant Vice President
Telephone: (312) 220-7318
Facsimile: (312) 641-0527
Page 83
$14,375,000 SUNTRUST BANK, ATLANTA
By:/s/ Shelley M. Browne
Title:Vice President
By:/s/ Jennifer P. Harrelson
Title:Senior Vice President
Address: 25 Park Place
Atlanta, GA 30303
Attention: Shelley Browne
Telephone: (404) 658-4918
Facsimile: (404) 588-8505
Page 84
$3,750,000 FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
By:/s/ James H. Moore, Jr.
Title:Vice President
Address: 165 Madison Avenue
Memphis, TN 38109-0084
Telephone: (901) 523-4108
Facsimile: (901) 523-4267
Page 85
$18,125,000 MELLON BANK, N.A.
By:/s/ Laurel Larson
Title:Assistant Vice President
Address: 55 East Monroe
Suite 2600
Chicago, IL 60603
Telephone: (312) 357-3408
Facsimile: (312) 357-3414
Page 86
$25,000,000 NATIONSBANK, N.A.
By:/s/ Mary Carol Daly
Title:Vice President
Address: 233 S. Wacker Drive
Suite 2800
Chicago, IL 60606
Telephone: (312) 234-5618
Facsimile: (312) 234-5619
Page 87
$12,500,000 THE SANWA BANK, LIMITED, CHICAGO BRANCH
By:/s/ Richard H. Ault
Title:Vice President
Address: 10 S. wacker Drive
31st Floor
Chicago, IL 60606
Telephone: (312) 368-3011
Facsimile: (312) 346-6677
Page 88
$7,500,000 THE NORTHERN TRUST COMPANY
By:/s/ Diane M. Baer
Title:Second Vice President
Address: 50 S. LaSalle Street
Chicago, IL 60675
Telephone: (312) 444-5802
Facsimile: (312) 444-5055
- ------------
$250,000,000
============
Page 89
PRICING SCHEDULE
The Applicable Margin or Facility Fee Rate at any date is the
applicable percentage amount set forth in the table below based on the Pricing
Level at such date:
- ---------- ------------------ -------------------- ------------------- ---------------- ---------------- ==================
Level I Level II Level III Level IV Level V Level VI
- ---------- ------------------ -------------------- ------------------- ---------------- ---------------- ==================
Applicable 0.1750% 0.1950% 0.2350% 0.2700% 0.3500% 0.5625%
Eurocurrency
Margin
- ---------- ------------------ -------------------- ------------------- ---------------- ---------------- ==================
Applicable 0.3000% 0.3250% 0.3600% 0.3950% 0.4750% 0.6875%
CD Rate
Margin
- ---------- ------------------ -------------------- ------------------- ---------------- ---------------- ==================
Facility 0.0500% 0.0550% 0.0650% 0.0800% 0.1000% 0.1875%
Fee Rate
- ---------- ------------------ -------------------- ------------------- ---------------- ---------------- ==================
For purposes of this Schedule, the following terms have the
following meanings:
"Debt Rating" means at any date the higher of the credit
ratings, if any, publicly announced by S&P and Moody's for the Company's senior
unsecured debt without third-party credit enhancement (or if only one of S&P or
Moody's shall have assigned a credit rating, then such rating). If the ratings
assigned by S&P and Moody's differ by more than one increment, the Debt Rating
will be the median rating (or the higher of two intermediate ratings if there is
no median rating).
"Level I Pricing" applies at any date if, at such date, the
Debt Rating is A(A2) or better.
"Level II Pricing" applies at any date if, at such date, (a)
the Debt Rating is A-(A3) or better and (b) no better Pricing Level applies.
"Level III Pricing" applies at any date if, at such date, (a)
the Debt Rating is BBB+(Baa1) or better and (b) no better Pricing Level applies.
"Level IV Pricing" applies at any date if, at such date, (a)
the Debt Rating is BBB(Baa2) or better and (b) no better Pricing Level applies.
"Level V Pricing" applies at any date if, at such date, (a)
the Debt Rating is BBB-(Baa3) or better and (b) no better Pricing Level applies.
"Level VI Pricing" applies at any date if, at such date, no
other Pricing Level applies.
"Pricing Level" refers to the determination of which of Level
I, Level II, Level III, Level IV, Level V or Level VI applies at any date.
Notwithstanding the foregoing, for so long after the
effectiveness of this Agreement as the credit ratings of the Company remain, as
a result of the WMX Repurchase, on credit watch (with negative implications) or
similar status as publicly announced by either Moody's or S&P, if the Pricing
Level for any date would otherwise be Level I or Level II, the Pricing Level for
such date shall be Level III.
SCHEDULE 6.11
SUBSIDIARY RESTRICTIONS
1. American Home Shield Corporation and its subsidiaries are subject to
regulatory restrictions imposed by various states which limit dividends and
similar payments.
EXHIBIT "A"
NOTE
_________ ___,19__
THE SERVICEMASTER COMPANY LIMITED PARTNERSHIP, a Delaware limited
partnership (the "Company"), promises to pay to the order of ___________ (the
"Lender") the aggregate unpaid principal amount of all Loans made by the Lender
to the Company pursuant to the 364-Day Credit Agreement dated as of April 1,
1997 among the Company, the Lenders named therein, including the Lender, The
First National Bank of Chicago, as Administrative Agent, and Morgan Guaranty
Trust Company of New York, as Documentation Agent (as the same may be amended or
modified, hereinafter referred to as the "Agreement"), in the currencies and on
the dates specified in the Agreement, in immediately available funds at the main
office of The First National Bank of Chicago in Chicago, Illinois, as
Administrative Agent, or as otherwise directed by the Administrative Agent
pursuant to the terms of the Agreement, together with interest, in like currency
and funds, on the unpaid principal amount hereof at the rates and on the dates
specified in the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder; provided, however, that any failure to so record shall not
affect the Company's obligations under any Loan Document.
This Note is one of the Notes issued pursuant to, and is entitled to
the benefits of, the Agreement, to which Agreement, as it may be amended from
time to time, reference is hereby made for a statement of the terms and
conditions under which this Note may be prepaid or its maturity date
accelerated. Capitalized terms used herein and not otherwise defined herein are
used with the meanings attributed to them in the Agreement.
THE SERVICEMASTER COMPANY
LIMITED PARTNERSHIP
By: ServiceMaster Management
Corporation,
its General Partner
By: __________________________________
Title: _______________________________
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF THE SERVICEMASTER COMPANY
LIMITED PARTNERSHIP
Date Currency Maturity Principal Unpaid
and Amount Balance
Principal Paid
Amount of
Loan
- ---------- ----------- --------- ----------- ---------
EXHIBIT "B-1"
FORM OF OPINION OF KIRKLAND & ELLIS
April 1, 1997
To the Lenders who are parties to the
Credit Agreement described herein
Re: The ServiceMaster Company Limited
Partnership 364-Day Credit Agreement
dated as of April 1, 1997
Ladies and Gentlemen:
We have acted as special counsel to The ServiceMaster Company Limited
Partnership, a Delaware limited partnership (the "Company"), in connection with
the negotiation, execution and delivery of the 364-Day Credit Agreement dated as
of April 1, 1997 among the Company, The First National Bank of Chicago,
individually and as Administrative Agent, Morgan Guaranty Trust Company of New
York, individually and as Documentation Agent, and the Lenders named therein,
providing for Advances in an aggregate principal amount not exceeding
$250,000,000 at any one time outstanding (the "Credit Agreement"). Terms used
but not otherwise defined herein are used herein as defined in the Credit
Agreement.
For purposes of this opinion, we have examined the following:
(a) the Credit Agreement; and
(b) the proposed notes to be issued by the Company to the Lenders
pursuant to the Credit Agreement (the "Notes").
In addition, in connection with rendering the opinions expressed below
("our opinions"), we have examined and relied upon the originals, or copies
certified or otherwise identified to our satisfaction, of such records,
certificates and other documents, as in our judgment are necessary or
appropriate to enable us to render our opinions. As to various factual matters
material to our opinions, we have relied upon certificates of public officials,
certificates of officers of ServiceMaster Management Corporation, a Delaware
corporation (the "Corporate General Partner") on behalf of the Company and the
representations and warranties contained in Article V of the Credit Agreement.
In addition, in rendering our opinions, we have assumed, with your permission
and without independent verification, that:
(a) the signatures of persons signing all documents in connection with
which our opinions are rendered are genuine and authorized (other than those of
the Company and the Corporate General Partner on the Credit Agreement, the
Notes, and other agreements, certificates and documents entered into in
connection with the closing of the transactions contemplated by the Credit
Agreement);
(b) all documents submitted to us as originals or duplicate originals
are authentic;
(c) all documents submitted to us as copies, whether certified or not,
conform to authentic original documents;
(d) all parties to the documents reviewed by us (other than the Company
and the Corporate General Partner in connection with the Credit Agreement and
other agreements, certificates and documents entered into in connection with the
closing of the transactions contemplated by the Credit Agreement) have full
power and authority to execute, to deliver and to perform their obligations
under such documents and under the documents required or permitted to be
delivered and performed thereunder, and all such documents have been duly
authorized by all necessary action, have been duly executed by such parties,
have been duly delivered by such parties, and are legal, valid and binding
obligations of such parties enforceable in accordance with their terms;
(e) any approval, consent or withholding of objection on the part of,
or filing, registration or qualification with, any governmental body which may
be required in connection with the execution and delivery of the Credit
Agreement on account of your regulatory status has been obtained or made by you;
and
(f) the opinions set forth in the letter to you of even date herewith
from Vernon T. Squires, Esq. are correct.
Based upon and subject to the foregoing, we are of the opinion that:
(1) The Company is a limited partnership, validly existing under the
laws of the State of Delaware, has full partnership power and authority and is
duly authorized to enter into and perform the Credit Agreement and to incur the
obligations to be evidenced by the Notes;
(2) The Corporate General Partner is a corporation validly existing and
in good standing under the laws of the State of Delaware, has full corporate
power and authority and is duly authorized to execute and deliver the Credit
Agreement on behalf of the Company;
(3) The execution and delivery of the Credit Agreement and the Notes by
the Corporate General Partner on behalf of the Company do not conflict with or
result in a breach of any provision of the Amended and Restated Agreement of
Limited Partnership of the Company; and
(4) The Credit Agreement and the Notes have been duly authorized,
executed and delivered by the Corporate General Partner on behalf of the Company
and constitute legal, valid and binding obligations of the Company enforceable
in accordance with their respective terms.
Our opinions are subject to the following further qualifications:
(a) our opinions are subject to the effect of any applicable
bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent
conveyance or other similar laws;
(b) the binding effect and the enforceability of the Credit Agreement
and the Notes and the availability of injunctive relief or other equitable
remedies thereunder are subject to the effect of general principles of equity
(regardless of whether enforcement is considered in proceedings at law or in
equity);
(c) the binding effect and the enforceability of the Credit Agreement
and the Notes are subject to the effect of laws and judicial decisions which
have imposed duties and standards of conduct (including, without limitation,
obligations of good faith, fair dealing and reasonableness and any obligation to
demonstrate that enforcement of provisions that are burdensome on a debtor is
reasonably necessary for the protection of the creditor) upon creditors;
(d) we express no opinion as to the enforceability of cumulative
remedies to the extent such cumulative remedies purport to or would have the
effect of compensating the party entitled to the benefits thereof in amounts in
excess of the actual loss suffered by such party or would violate applicable
laws concerning election of remedies;
(e) notwithstanding certain language of the Credit Agreement, you will
be limited to recovering only reasonable expenses, only reasonable attorneys'
fees and legal expenses and only reasonable compensation for funding losses,
increased costs or yield protection;
(f) we express no opinion as to, or the effect or applicability of, any
laws other than the laws of the State of New York, the federal laws of the
United States of America and the General Corporation Law and the Revised Uniform
Limited Partnership Act of the State of Delaware;
(g) requirements in the Credit Agreement specifying that provisions
thereof may only be waived in writing may not be valid, binding or enforceable
to the extent that an oral agreement or an implied agreement by trade practice
or course of conduct has been created modifying any provision of such documents;
(h) we express no opinion as to the enforceability of the
indemnification provisions of the Credit Agreement insofar as said provisions
contravene public policy or might require indemnification or payments to you
with respect to any loss, cost or expense arising out of your gross negligence
or willful misconduct or any violation by you of statutory duties, general
principles of equity or public policy;
(i) waivers of equitable rights and defenses may not be valid, binding
or enforceable under state or federal law and certain rights of debtors and
duties of lenders may not be waived, released, varied or disclaimed by agreement
prior to a default; and
(j) we express no opinion as to the validity, binding effect or
enforceability of Section 9.10 of the Credit Agreement (Consent to
Jurisdiction).
This letter is furnished to you pursuant to Section 4.1(v) of the
Credit Agreement and is not to be used, circulated, quoted or otherwise relied
upon by any other person or entity or for any other purpose.
This opinion is for the benefit of the Lenders and their respective
counsel, and may not be relied upon by any other person. This opinion is limited
to the specific issues addressed and is limited in all respects to laws and
facts existing on the date hereof. By rendering this opinion, we do not
undertake to advise you of any changes in such laws or facts which may occur
after the date hereof.
Very truly yours,
KIRKLAND & ELLIS
EXHIBIT "B-2"
FORM OF OPINION OF GENERAL COUNSEL
April 1, 1997
To the Lenders who are parties to the
Credit Agreement described herein
Re: The ServiceMaster Company Limited
Partnership 364-Day Credit Agreement
dated as of April 1, 1997
Ladies and Gentlemen:
I am the Senior Vice President and General Counsel of The ServiceMaster
Company Limited Partnership, a Delaware limited partnership (the "Company") and,
in that capacity, I am familiar with the details of the negotiation, execution
and delivery of the 364-Day Credit Agreement dated as of April 1, 1997 among the
Company, The First National Bank of Chicago, as Administrative Agent, Morgan
Guaranty Trust Company of New York, as Documentation Agent and the Lenders named
therein, providing for Advances in an aggregate principal amount not exceeding
$250,000,000 at any one time outstanding (the "Credit Agreement"). I am
furnishing this opinion to you pursuant to Section 4.1(vi) of the Credit
Agreement. Unless otherwise defined herein, capitalized terms used herein have
the meanings assigned to such terms in the Credit Agreement.
For purposes of this opinion, I have examined the following:
(a) the Credit Agreement; and
(b) the proposed notes issued by the Company to the Lenders
pursuant to the Credit Agreement (the "Notes").
In addition, I have also examined such certificates of public
officials, certificates of officers of the Company, and copies of corporate and
partnership documents and records of the Company and other papers, and I have
made such other investigations as I have deemed relevant and necessary as a
basis for my opinions hereinafter set forth. In all such examinations I have
assumed the genuineness of all signatures (other than the signatures of officers
of the Company), the authenticity and completeness of all documents submitted to
me as originals, the due authority of the parties executing such documents
(other than on behalf of the Company) and the conformity to the originals of
documents submitted to me as copies.
Based on the foregoing and subject to the qualifications set forth
below, I am of the opinion that:
(1) No approval, consent or withholding of objection on the part of any
regulatory body, federal, state or local, is necessary in connection with the
execution and delivery of the Credit Agreement or the Notes.
(2) The Company has full power and authority and is duly authorized to
conduct the activities in which it is now engaged and is duly licensed or
qualified and is in good standing as a foreign limited partnership in each
jurisdiction (to the extent qualification of a foreign limited partnership is
permitted by statute) where a failure so to qualify would reasonably be expected
to have a Material Adverse Effect and, in my opinion, the inability of the
Company to qualify as a foreign limited partnership in any state in which such
qualification is not permitted by law will not have a Material Adverse Effect.
(3) Each Material Subsidiary is a corporation or a limited partnership
duly incorporated or organized, as the case may be, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization, as
the case may be, has full power and authority and is duly authorized to conduct
the activities in which it is now engaged, and is duly licensed or qualified and
is in good standing in each jurisdiction (to the extent qualification of a
foreign limited partnership is permitted by statute) where a failure so to
qualify would reasonably be expected to have a Material Adverse Effect and, in
my opinion, the inability of any Material Subsidiary that is a limited
partnership to qualify as a foreign limited partnership in any state in which
such qualification is not permitted by law will not have a Material Adverse
Effect.
(4) The issuance of the Notes and the execution, delivery and
performance by the Company of the Credit Agreement (i) do not violate in any
material respect any provisions of any law or any order of any court,
governmental authority or agency, (ii) do not conflict with or result in any
breach of any of the terms, conditions or provisions of, or constitute a default
under, the limited partnership agreement of the Company or any agreement or any
debt instrument or other material agreement known to me to which the Company or
any Eligible Subsidiary is a party or by which the Company or any Eligible
Subsidiary may be bound and (iii) will not result in the creation or imposition
of any lien or encumbrance upon any of the property of the Company or any
Eligible Subsidiary.
(5) There are no proceedings pending or, to my knowledge, threatened,
against or affecting the Company, any of its General Partners, its Parent or any
Subsidiary in any court or before any governmental authority or arbitration
board or tribunal which, if adversely determined, would reasonably be expected
to have a Material Adverse Effect. To my knowledge, neither the Company nor any
Subsidiary is in default with respect to any order of any court or governmental
authority, or arbitration board or tribunal which would reasonably be expected
to have a Material Adverse Effect.
(6) No documentary or stamp taxes are payable in connection with the
issuance of the Notes.
(7) Neither the issuance of the Notes nor the use by the Company of all
or any portion of the proceeds of the Advances will violate Regulations U or X
of the Board of Governors of the Federal Reserve System (12 C.F.R. Chapter II).
The opinions expressed in this letter as to enforceability are subject
to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally, to general principles of equity regardless of whether such
enforceability is considered in a proceeding in equity or at law or in a
bankruptcy proceeding, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and applicable laws and court
decisions which may limit the enforceability of certain remedial and other
provisions of the Notes.
The opinions expressed above are limited to the laws of the State of
Illinois, the federal laws of the United States of America, the Delaware General
Corporation Law and the Delaware Revised Uniform Limited Partnership Act, and I
do not express any opinion herein concerning any other law.
The opinions expressed herein are solely for your benefit in connection
with the consummation of the transactions contemplated by the Credit Agreement
and may not be used or relied upon by any Person other than each of you.
Very truly yours,
Vernon T. Squires
Senior Vice President
and General Counsel
EXHIBIT "C"
COMPETITIVE BID QUOTE REQUEST
(Section 2.3.2)
_________, 19__
To: The Lenders parties to the Credit Agreement described
below
From: [Name of Borrower]
Re: 364-Day Credit Agreement (the "Credit Agreement") dated as of April 1,
1997 among The ServiceMaster Company Limited Partnership, the Lenders
named therein, The First National Bank of Chicago, as Administrative
Agent, and Morgan Guaranty Trust Company of New York, as Documentation
Agent
We hereby give notice pursuant to Section 2.3.2 of the 364-Day Credit
Agreement that we request Competitive Bid Quotes for the following proposed
Competitive Bid Advance(s):
Borrowing Date: , 19__
Principal Amount (1) Interest Period (2)
- ------------------------------ ------------------------
Such Competitive Bid Quotes should offer [a Competitive Bid Margin]
[and] [an Absolute Rate]. [The currency in which the Loans are to be denominated
is __________.] Your Competitive Bid Quote must comply with Section 2.3.3 of the
Credit Agreement and the foregoing. Capitalized terms used herein have the
meanings assigned to them in the Credit Agreement.
Please respond to this request by no later than [1:00 p.m.]
[9:00 a.m.] Chicago time on , 19__.
[NAME OF BORROWER]
By:
Financial Officer
- ------------------------
1 Amount must be at least (i) $1,000,000 or any larger integral multiple of
$1,000,000 in the case of a Floating Rate Advance, (ii) $5,000,000 or any larger
integral multiple of $1,000,000 in the case of any other Advance denominated in
Dollars or (iii) such amount and multiples as the Administrative Agent deems
appropriate and reasonably comparable to a $3,000,000 minimum Dollar Amount in
the case of any Advance denominated in an Alternative Currency.
2 One, two, three or six months (Eurocurrency Auction) or not less than 7
days (Absolute Rate Auction), subject to the provisions of the definitions of
Eurocurrency Interest Period and Absolute Rate Interest Period.
EXHIBIT "D"
COMPETITIVE BID QUOTE
(Section 2.3.3)
____________, 19__
To: [Name of Borrower] (the "Borrower")
Re: Competitive Bid Quote
In response to your request dated _________, 199_, we hereby make the following
Competitive Bid Quote pursuant to Section 2.3.3 of the Credit Agreement
hereinafter referred to and on the following terms:
1. Quoting Lender: _____________________________________________
2. Person to contact at Quoting Lender: ________________________
3. Borrowing Date: ____________, 19__ (3)
4. We hereby offer to make Competitive Bid Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
Principal Interest [Competitive [Absolute
Amount (4) Period (5) Bid Margin (6)] Rate (7)]
- ---------- ----------- --------------- ----------
[Provided, that the aggregate principal amount of Competitive Bid Loans for
which the above offers may be accepted shall not exceed $_________________.]8
- ----------------
3 As specified in the related Invitation For Competitive Bid Quotes.
4 Principal amount bid for each Interest Period may not exceed the principal
amount requested. Bids must be made for at least (i) $1,000,000 or any larger
integral multiple of $1,000,000 in the case of a Floating Rate Advance, (ii)
$5,000,000 or any larger integral multiple of $1,000,000 in the case of any
other Advance denominated in Dollars or (iii) such amount and multiples as the
Administrative Agent deems appropriate and reasonably comparable to a $3,000,000
minimum Dollar Amount in the case of any Advance denominated in an Alternative
Currency.
5 One, two, three or six months (Eurocurrency Auction) or not less than 7
days (Absolute Rate Auction), as specified in the related Invitation For
Competitive Bid Quotes.
6 Specify positive or negative percentage (rounded to the nearest 1/100 of
1%) to be added or subtracted from the Eurocurrency Base Rate.
7 Specify rate of interest per annum (rounded to the nearest 1/100 of 1%).
8 Specify the limit, if any, as to the aggregate principal amount of the
Competitive Bid Loans of the quoting Lender which the Borrower may accept (see
Section 2.3.3 (ii) (d)).
We understand and agree that the offers set forth above,
subject to the satisfaction of the applicable conditions set forth in the
364-Day Credit Agreement dated as of April 1, 1997, among The ServiceMaster
Company Limited Partnership, the Lenders named therein, The First National Bank
of Chicago, as Administrative Agent and Morgan Guaranty Trust Company of New
York, as Documentation Agent (the "Credit Agreement"), irrevocably obligates us
to make the Competitive Bid Loan(s) for which any offer(s) are accepted, in
whole or in part.
Capitalized terms used herein and not otherwise defined herein shall have their
meanings as defined in the Credit Agreement.
Very truly yours,
[NAME OF BANK]
Dated: , 19__ By:
Authorized Officer
EXHIBIT "E"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement")
between (the "Assignor") and (the "Assignee") is dated as of _________ __, 19__.
The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a 364-Day
Credit Agreement, dated as of April 1, 1997 (which, as it may be amended,
modified, renewed or extended from time to time, is herein called the "Credit
Agreement"), among The ServiceMaster Company Limited Partnership (the
"Company"), the Lenders named therein, The First National Bank of Chicago, as
Administrative Agent, and Morgan Guaranty Trust Company of New York, as
Documentation Agent. Capitalized terms used herein and not otherwise defined
herein shall have the meanings attributed to them in the Credit Agreement. The
Assignor desires to assign to the Assignee, and the Assignee desires to assume
from the Assignor, an undivided interest (the "Purchased Percentage") in the
Commitment of the Assignor such that after giving effect to the assignment and
assumption hereinafter provided, the Commitment of the Assignee shall equal
$______________ and its percentage of the Aggregate Commitment shall equal __%.
2. ASSIGNMENT. For and in consideration of the assumption of
obligations by the Assignee set forth in Section 3 hereof and the other
consideration set forth herein, and effective as of the Effective Date (as
hereinafter defined), the Assignor does hereby sell, assign, transfer and convey
to the Assignee all of its right, title and interest in and to the Purchased
Percentage of (i) the Commitment of the Assignor (as in effect on the Effective
Date), (ii) each Committed Loan made by the Assignor outstanding on the
Effective Date and (iii) the Credit Agreement and the other Loan Documents.
Pursuant to Section 12.3.2 of the Credit Agreement, on and after the Effective
Date the Assignee shall have the same rights, benefits and obligations as the
Assignor had under the Loan Documents with respect to the Purchased Percentage
of the Loan Documents, all determined as if the Assignee were a "Lender" under
the Credit Agreement with ____% of the Aggregate Commitment. The Effective Date
shall be the later of ______ or two Business Days (or such shorter period agreed
to by the Agents) after a Notice of Assignment substantially in the form of
Exhibit "I" attached hereto and any consents substantially in the form of
Exhibit "II" attached hereto required to be delivered to the Agents by Section
12.3 of the Credit Agreement have been delivered to the Agents. In no event will
the Effective Date occur if the payments required to be made by the Assignee to
the Assignor on the Effective Date under Sections 4 and 5 hereof are not made on
the proposed Effective Date. The Assignor will notify the Assignee of the
proposed Effective Date on the Business Day prior to the proposed Effective
Date.
3. ASSUMPTION. For and in consideration of the assignment of
rights by the Assignor set forth in Section 2 hereof and the other consideration
set forth herein, and effective as of the Effective Date, the Assignee does
hereby accept that assignment, and assume and covenant and agree fully,
completely and timely to perform, comply with and discharge, each and all of the
obligations, duties and liabilities of the Assignor under the Credit Agreement
which are assigned to the Assignee hereunder, which assumption includes, without
limitation, the obligation to fund the unfunded portion of the Aggregate
Commitment in accordance with the provisions set forth in the Credit Agreement
as if the Assignee were a "Lender" under the Credit Agreement with ___% of the
Aggregate Commitment. The Assignee agrees to be bound by all provisions relating
to "Lenders" under and as defined in the Credit Agreement, including, without
limitation, provisions relating to the dissemination of information and the
payment of indemnification.
4. PAYMENT OBLIGATIONS. On and after the Effective Date, the
Assignee shall be entitled to receive from the Administrative Agent all payments
of principal, interest and fees with respect to the Purchased Percentage of the
Assignor's Commitment and Committed Loans. The Assignee shall advance funds
directly to the Administrative Agent with respect to each Committed Loan and
reimbursement payments made on or after the Effective Date. In consideration for
the transfer of the assigned obligations hereunder, with respect to each
Committed Loan made by the Assignor outstanding on the Effective Date, the
Assignee shall pay the Assignor on the Effective Date (or, if Assignee so elects
with respect to each Committed Loan bearing interest at a Fixed Rate, on the
Payment Date, as hereinafter defined) an amount equal to the Purchased
Percentage of any such Committed Loan. If the Assignee elects to make such
payment on the Effective Date, with respect to any Committed Loan made by
Assignor outstanding on the Effective Date which bears interest at a fixed rate
(each an "Outstanding Fixed Rate Loan"), Assignee shall be entitled to receive
interest at a rate agreed upon by the Assignee and the Assignor (the
"Outstanding Fixed Rate Loan Interest Rate") for the remainder of the existing
Interest Period. When Assignee receives interest on the Purchased Percentage of
any Outstanding Fixed Rate Loan, Assignee shall remit to Assignor the excess of
(a) the interest received by Assignee on the Outstanding Fixed Rate Loan over
(b) the Outstanding Fixed Rate Loan Interest Rate. In the event Assignee elects
not to pay the Assignor the Purchased Percentage of any such Outstanding Fixed
Rate Loan on the Effective Date, the Assignee shall pay the Assignor an amount
equal to the Purchased Percentage of such Outstanding Fixed Rate Loan (a) on the
last day of the Interest Period therefor or (b) on such earlier date agreed to
by the Assignor and the Assignee or (c) on the date on which any such
Outstanding Fixed Rate Loan either becomes due (by acceleration or otherwise) or
is prepaid (the date as described in the foregoing clauses (a), (b) or (c) being
hereinafter referred to as the "Payment Date"). In the event interest for the
period from the Effective Date to but not including the Payment Date is not paid
by the Borrower with respect to any Outstanding Fixed Rate Loan sold by the
Assignor to the Assignee pursuant to the preceding sentence, the Assignee shall
pay to the Assignor interest for such period on such Outstanding Fixed Rate Loan
at the applicable rate provided by the Credit Agreement. In the event of a
prepayment of any Outstanding Fixed Rate Loan, Assignee shall remit to Assignor
the excess of (a) the amount received by the Assignee as breakage costs over (b)
the amount which would have been received by the Assignee as a prepayment
penalty if the amount of prepayment penalty was based on the Outstanding Fixed
Rate Loan Interest Rate. On and after the Effective Date, the Assignee will also
remit to the Assignor any amounts of interest on Loans and fees received from
the Administrative Agent which relate to the Purchased Percentage of Loans made
by the Assignor accrued for periods prior to the Effective Date or the Payment
Date as applicable. In the event that either party hereto receives any payment
to which the other party hereto is entitled under this Assignment Agreement,
then the party receiving such amount shall promptly remit it to the other party
hereto. ***[This Section subject to modification by the Assignor and the
Assignee]***
5. FEES PAYABLE BY ASSIGNEE. On each day on which the Assignee
receives a payment of interest or fees under the Credit Agreement (other than a
payment of interest or fees which the Assignee is obligated to deliver to the
Assignor pursuant to Section 4 hereof, which shall be excluded in determining
fees payable to the Assignor pursuant to this Section), the Assignee shall pay
to the Assignor a fee. The amount of such fee shall be the difference between
(i) the amount of such interest or fee, as applicable, received by the Assignee
and (ii) the amount of the interest or fee, as applicable, which would have been
received by the Assignee if each interest rate was ___ of 1% less than the
interest rate paid by the Company or if the facility fee was ___ of 1% less than
the facility fee paid by the Company pursuant to Section 2.4, as applicable. In
addition, the Assignee agrees to pay __% of the fee required to be paid to the
Administrative Agent pursuant to Section 12.3.2 of the Credit Agreement.
***[This Section subject to modification by the Assignor and the Assignee]***
6. CREDIT DETERMINATION: LIMITATIONS ON ASSIGNORS LIABILITY.
The Assignee represents and warrants to the Assignor that it is capable of
making and has made and shall continue to make its own credit determinations and
analysis based upon such information as the Assignee deemed sufficient to enter
into the transaction contemplated hereby and not based on any statements or
representations by the Assignor, the Agents or any Lender. It is understood and
agreed that the assignment and assumption hereunder are made without recourse to
the Assignor and that the Assignor makes no representation or warranty of any
kind to the Assignee and shall not be responsible for (i) the due execution,
legality, validity, enforceability, genuineness, sufficiency or collectibility
of the Credit Agreement or any other Loan Document, including without
limitation, documents granting the Assignor and the other Lenders a security
interest in assets of the Company or any of its Subsidiaries, or any guarantor,
(ii) any representation, warranty or statement made in or in connection with any
of the Loan Documents, (iii) the financial condition or creditworthiness of any
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) the inspection of any of
the property, books or records of the Company or any of its Subsidiaries, (vi)
the validity, enforceability, perfection, priority, condition, value or
sufficiency of any collateral securing or purporting to secure the Loans.
Neither the Assignor nor any of its officers, directors, employees, agents or
attorneys shall be liable for any mistake, error of judgment, or action taken or
omitted to be taken in connection with the Loans or the Loan Documents, except
for its or their own bad faith or willful misconduct.
7. INDEMNITY. The Assignee agrees to indemnify and hold the
Assignor harmless against any and all losses, costs and expenses (including,
without limitation, reasonable attorneys' fees, which attorneys may be employees
of the Assignee) and liabilities incurred by the Assignor in connection with or
arising in any manner from the Assignee's performance or non-performance of
obligations assumed under this Assignment Agreement.
8. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the
Assignee shall have the right pursuant to Section 12.3 of the Credit Agreement
to assign the rights which are assigned to the Assignee hereunder to any entity
or person, provided that (i) any such subsequent assignment does not violate any
of the terms and conditions of the Loan Documents or any law, rule, regulations
order, writ, judgment, injunction or decree and that any consent required under
the terms of the Loan Documents has been obtained, (ii) the assignee under such
assignment from the Assignee shall agree to assume all of the Assignee's
obligations hereunder in a manner satisfactory to the Assignor and (iii) the
Assignee is not thereby released from any of its obligations to the Assignor
hereunder.
9. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage of the Aggregate Commitment assigned to the
Assignee shall remain the percentage specified in Section 1 hereof and the
dollar amount of the Commitment of the Assignee shall be recalculated based on
the reduced Aggregate Commitment.
10. ENTIRE AGREEMENT. This Assignment Agreement ****[and the
attached consent]**** embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings between the
parties hereto relating to the subject matter hereof.
11. GOVERNING LAW. This Assignment Agreement shall be governed
by the internal law, and not the law of conflicts, of the State of New York.
12. NOTICES. Notices shall be given under this Assignment
Agreement in the manner set forth in the Credit Agreement. For the purpose
hereof, the addresses of the parties hereto (until notice of a change is
delivered) shall be the address set forth under each party's name on the
signature pages hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
[NAME OF ASSIGNOR]
By:
Title:
[NAME OF ASSIGNEE]
By:
Title:
EXHIBIT "I"
NOTICE
OF ASSIGNMENT
To: THE SERVICEMASTER COMPANY LIMITED PARTNERSHIP
One ServiceMaster Way
Downers Grove, IL 60515
Attention: Eric R. Zarnikow
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Documentation Agent
60 Wall Street
New York, NY 10260
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
One First National Plaza
Chicago, IL 60670
From: [NAME OF ASSIGNOR]
[NAME OF ASSIGNEE]
, 19__
1. We refer to that 364-Day Credit Agreement, dated as of
April 1,1997 (which, as it may be amended, modified, renewed or extended from
time to time, is herein called the "Credit Agreement"), among The ServiceMaster
Company Limited Partnership (the "Company"), the Lenders named therein including
____________ (the "Assignor"), The First National Bank of Chicago, as
Administrative Agent, and Morgan Guaranty Trust Company of New York, as
Documentation Agent. Capitalized terms used herein and in any consent delivered
in connection herewith and not otherwise defined herein or in such consent shall
have the meanings attributed to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and
delivered to the Company and the Agents pursuant to Section 12.3.2 of the Credit
Agreement.
3. The Assignor and (the "Assignee") have entered into an
Assignment Agreement, dated as of , 19__, pursuant to which, among other things,
the Assignor has sold, assigned, delegated and transferred to the Assignee, and
the Assignee has purchased, accepted and assumed from the Assignor, an undivided
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement such that Assignee's percentage of the Aggregate Commitment shall
equal __%, effective as of the Effective Date (as hereinafter defined). The
"Effective Date" shall be the later of ____ or two Business Days (or such
shorter period as agreed to by the Agents) after this Notice of Assignment and
any consents and fees required by Sections 12.3.1 and 12.3.2 of the Credit
Agreement have been delivered to the Agents, provided that the Effective Date
shall not occur if any condition precedent agreed to by the Assignor and the
Assignee has not been satisfied.
4. As of this date, the percentage of the Assignor in the
Aggregate Commitment and Committed Advances is __%. As of the Effective Date,
the percentage of the Assignor in the Aggregate Commitment and Committed
Advances will be __% (as such percentage may be reduced or increased by
assignments which become effective prior to the assignment to the Assignee
becoming effective) and the percentage of the Assignee in the Aggregate
Commitment and Committed Advances will be __%.
5. The Assignor and the Assignee hereby give to the Company
and the Agents notice of the assignment and delegation referred to herein. The
Assignor will confer with the Agents before _______, 19__ to determine if the
assignment to the Assignee will become effective on such date pursuant to
Section 3 hereof, and will confer with the Agents to determine the Effective
Date pursuant to Section 3 hereof if it occurs thereafter. The Assignor shall
notify the Agents if the assignment to the Assignee does not become effective on
any proposed Effective Date as a result of the failure to satisfy the conditions
precedent agreed to by the Assignor and the Assignee. At the request of the
Agent, the Assignor will give the Agents written confirmation of the occurrence
of the Effective Date.
6. The Assignee hereby accepts and assumes the assignment and
delegation referred to herein and agrees as of the Effective Date (i) to perform
fully all of the obligations under the Credit Agreement which it has hereby
assumed and (ii) to be bound by the terms and conditions of the Credit Agreement
as if it were a "Lender".
7. The Assignor and the Assignee request and agree that any
payments to be made by the Administrative Agent to the Assignor on and after the
Effective Date shall, to the extent of the assignment referred to herein, be
made entirely to the Assignee, it being understood that the Assignor and the
Assignee shall make between themselves any desired allocations.
8. The Assignor or the Assignee shall pay to the
Administrative Agent on or before the Effective Date the processing fee of
$3,500 required by Section 12.3.2 of the Credit Agreement.
9. The Assignor and the Assignee request and direct that the
Administrative Agent prepare and cause the Borrower(s) to execute and deliver
[new Notes or, as appropriate,] replacement Notes, to the Assignor and the
Assignee in accordance with Section 12.3.2 of the Credit Agreement. The Assignor
[and the Assignee] agree[s] to deliver to the Administrative Agent the original
Notes received from it by the Borrower(s) upon the Assignor's [and Assignee's]
receipt of new Notes in the amounts set forth above.
10. The Assignee advises the Agents that the address listed
below is its address for notices under the Credit Agreement:
- ----------------------
- ----------------------
- ----------------------
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
Title: Title:
EXHIBIT "II"
CONSENT AND RELEASE
TO: [NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
------------------------ ------------------------
------------------------ ------------------------
, 19__
1. We acknowledge receipt from (the "Assignor") and
______________________ (the "Assignee") of the Notice of Assignment, dated as of
__________, 19__ (the "Notice"). Capitalized terms used herein and not otherwise
defined herein shall have the meanings attributed to them in the Notice.
****[2. In consideration of the assumption by the Assignee of
the obligations of the Assignor as referred to in the Notice, the Company hereby
(i) irrevocably consents, as required by Section 12.3.1 of the Credit Agreement,
to the assignment and delegation referred to in the Notice and (ii) as of the
Effective Date, irrevocably reduces the percentage of the Assignor in the
Aggregate Commitment by the percentage of the Aggregate Commitment assigned to
the Assignee and releases the Assignor from all of its obligations to the
Company or any of its Subsidiaries under the Loan Documents to the extent that
such obligations have been assumed by the Assignee]****
3. The Administrative Agent is hereby requested to prepare for
issuance by the relevant Borrower new Notes as requested by the Assignor and the
Assignee in the Notice.
****[4. In consideration of the assumption by the Assignee of
the obligations of the Assignor as referred to in the Notice, the Agents hereby
(i) irrevocably consent, as required by Section 12.3.1 of the Credit Agreement,
to the assignment and delegation referred to in the Notice, (ii) as of the
Effective Date, irrevocably release the Assignor from its obligations to the
Agents under the Loan Documents to the extent that such obligations have been
assumed by the Assignee, and (iii) agree that, as of the Effective Date, the
Agents shall consider the Assignee as a "Lender" for all purposes under the Loan
Documents to the extent of the assignment and delegation referred to in the
Notice.]****
THE SERVICEMASTER COMPANY THE FIRST NATIONAL BANK
LIMITED PARTNERSHIP OF CHICAGO, as Administrative Agent
By: ServiceMaster Management By:
Corporation, its General Title:
Partner
MORGAN GUARANTY TRUST
By: COMPANY OF NEW YORK, as
Title: Documentation Agent
By:
Title:
* Paragraphs 2 and 4 are to be included only if the consent of the Company and
the Agents is required pursuant to Section 12.3.1 of the Credit Agreement.
EXHIBIT "F"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To: The First National Bank of Chicago, as Administrative Agent under the
Credit Agreement described below.
From: [Name of Borrower] (the "Borrower")
Re: 364-Day Credit Agreement, dated as of April 1, 1997 (as the same may be
amended or modified, the "Credit Agreement"), among The ServiceMaster
Company Limited Partnership, the Lenders named therein, The First
National Bank of Chicago, as Administrative Agent, and Morgan Guaranty
Trust Company of New York, as Documentation Agent.
Terms used herein and not otherwise defined shall have the
meanings assigned thereto in the Credit Agreement.
The Administrative Agent is specifically authorized and
directed to act upon the following standing money transfer instructions with
respect to the proceeds of Advances or other extensions of credit from time to
time until receipt by the Administrative Agent of a specific written revocation
of such instructions by the Borrower, provided, however, that the Administrative
Agent may otherwise transfer funds as hereafter directed in writing by the
Borrower in accordance with Section 13.1 of the Credit Agreement.
Facility Identification Number(s)
Customer/Account Name
Transfer Funds To
For Account No.
Reference/Attention To
Authorized Officer (Customer
Representative) Date
(Please Print) Signature
Bank Officer Name Date
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
EXHIBIT "G"
FORM OF ELECTION TO PARTICIPATE
__________, 19__
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation Agent
for the Lenders under the 364-Day Credit Agreement dated as of April 1,
1997 among The ServiceMaster Company Limited Partnership
(the "Company"), the Lenders named therein,
The First National Bank of Chicago, as
Administrative Agent, and the Documentation
Agent
Dear Sirs:
Reference is made to the Credit Agreement described above.
Terms not defined herein which are defined in the Credit Agreement have for the
purposes hereof the meaning provided therein.
The undersigned, [name of Eligible Subsidiary], a
[corporation] [partnership] organized under the laws of [jurisdiction of
organization], elects to be an Eligible Subsidiary for purposes of the Credit
Agreement, effective upon your receipt hereof until an Election to Terminate
shall have been delivered to you with respect to the undersigned in accordance
with the Credit Agreement.
The undersigned confirms that the representations and
warranties set forth in Article XIV of the Credit Agreement are true and correct
as to the undersigned as of the date hereof. In particular, [except as disclosed
below,] there is no income, stamp or other tax of any country, or any taxing
authority thereof or therein, imposed by or in the nature of withholding or
otherwise, which is imposed on any payment to be made by the undersigned
pursuant to the Credit Agreement or the Notes of the undersigned, or is imposed
on or by virtue of the execution, delivery or enforcement of this Election to
Participate or of the Notes of the undersigned.
The undersigned agrees to perform all the obligations of an
Eligible Subsidiary under, and to be bound in all respects by the terms of, the
Credit Agreement, including without limitation Sections 9.11 and 9.12 thereof,
as if the undersigned were a signatory party thereto. The undersigned hereby
confirms the authority of the Financial Officers to act on its behalf as to all
matters relating to the Credit Agreement.
The address to which all notices to the undersigned under the
Credit Agreement should be directed is:
This instrument shall be construed in accordance with and
governed by the laws of the State of New York.
Very truly yours,
[NAME OF ELIGIBLE SUBSIDIARY]
By __________________________________
Title:
The undersigned confirms that [name of Eligible Subsidiary] is
an additional Borrower for purposes of the Credit Agreement described above.
THE SERVICEMASTER COMPANY LIMITED
PARTNERSHIP
By: ServiceMaster Management
Corporation, its General Partner
By __________________________________
Title:
Receipt of the above Election to Participate is acknowledged
on and as of the date set forth above.
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation Agent
By __________________________________
Title:
EXHIBIT "H"
FORM OF ELECTION TO TERMINATE
__________, 19__
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation Agent
for the Lenders under the 364-Day Credit Agreement dated as of April 1,
1997 among The ServiceMaster Company Limited Partnership
(the "Company"), the Lenders named therein,
The First National Bank of Chicago, as
Administrative Agent, and the Documentation
Agent
Dear Sirs:
Reference is made to the Credit Agreement described above.
Terms not defined herein which are defined in the Credit Agreement have for the
purposes hereof the meaning provided therein.
The undersigned hereby elect to terminate the status of [name
of Eligible Subsidiary], a [corporation] [partnership] organized under the laws
of [jurisdiction of organization] (the "Designated Subsidiary"), as an Eligible
Subsidiary for purposes of the Credit Agreement, effective upon your receipt
hereof. The undersigned represent and warrant that all principal and interest on
all Notes of the Designated Subsidiary and all other amounts payable by the
Designated Subsidiary pursuant to the Credit Agreement have been paid in full on
or prior to the date hereof. Notwithstanding the foregoing, this Election to
Terminate shall not affect any obligation of the Designated Subsidiary under the
Credit Agreement or under any of its Notes heretofore incurred.
This instrument shall be construed in accordance with and
governed by the laws of the State of New York.
Very truly yours,
[NAME OF DESIGNATED SUBSIDIARY]
By __________________________________
Title:
THE SERVICEMASTER COMPANY LIMITED
PARTNERSHIP
By: ServiceMaster Management
Corporation, its General Partner
By __________________________________
Title:
Receipt of the above Election to Terminate is hereby
acknowledged on and as of the date set forth above.
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Documentation Agent
By __________________________________
Title:
EXHIBIT "I"
FORM OF OPINION OF COUNSEL FOR ELIGIBLE SUBSIDIARY
__________, 19__
To the Lenders and Agents
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Documentation Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
I am counsel to [name of Eligible Subsidiary], a [corporation]
[partnership] organized under the laws of [jurisdiction of organization] (the
"Eligible Subsidiary"), and give this opinion pursuant to Section 4.2(b) of the
364-Day Credit Agreement, dated as of April 1, 1997 (as the same may be amended
or modified, the "Credit Agreement"), among The ServiceMaster Company Limited
Partnership (the "Company"), the Lenders named therein, The First National Bank
of Chicago, as Administrative Agent, and Morgan Guaranty Trust Company of New
York, as Documentation 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 Eligible Subsidiary is a [corporation] [partnership]
duly organized, validly existing and in good standing under the laws of
[jurisdiction of organization], and is a Subsidiary of the Company.
2. The execution and delivery by the Eligible Subsidiary of
its Election to Participate and its Notes and the performance by the Eligible
Subsidiary of its obligations under the Credit Agreement and its Notes are
within the Eligible Subsidiary's legal powers, have been duly authorized by all
necessary [corporate] [partnership] or other legal 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, in any material respect any
provision of applicable law or regulation or of the organizational documents of
the Eligible Subsidiary or of any indenture or other agreement or instrument
governing Debt or any other material agreement or instrument binding upon the
Company or the Eligible Subsidiary or result in the creation or imposition of
any Lien on any asset of the Eligible Subsidiary or any of its Subsidiaries.
3. The Election to Participate of the Eligible Subsidiary and
the Credit Agreement constitute valid and binding agreements of the Eligible
Subsidiary and its Notes constitute valid and binding obligations of the
Eligible Subsidiary, in each case enforceable in accordance with its terms,
except as may be limited by (i) bankruptcy, insolvency or other similar laws
affecting the rights and remedies of creditors generally and (ii) general
principles of equity.
4. Except as disclosed in the Election to Participate, there
is no income, stamp or other tax of any country, or any taxing authority thereof
or therein, imposed by or in the nature of withholding or otherwise, which is
imposed on any payment to be made by the Eligible Subsidiary pursuant to the
Credit Agreement or on its Notes, or is imposed on or by virtue of the
execution, delivery or enforcement of its Election to Participate or of its
Notes.
Very truly yours,
EXHIBIT "J"
FORM OF OPINION OF COUNSEL FOR THE AGENTS
April 1, 1997
To the Lenders and the Agents
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Documentation Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
We have participated in the preparation of the 364-Day Credit
Agreement, dated as of April 1, 1997 (as the same may be amended or modified,
the "Credit Agreement"), among The ServiceMaster Company Limited Partnership
(the "Company"), the Lenders named therein, The First National Bank of Chicago,
as Administrative Agent, and Morgan Guaranty Trust Company of New York, as
Documentation Agent, and have acted as special counsel for the Agents for the
purpose of rendering this opinion pursuant to Section 4.1(x) 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
the Credit Agreement constitutes a valid and binding agreement of the Company
and the Notes of the Company constitute valid and binding obligations of the
Company, in each case enforceable in accordance with their respective terms,
except as the same may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and by general principles of equity.
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 and the
federal laws of the United States of America. To the extent that our opinion
expressed herein involves conclusions as to matters governed by the laws of
other jurisdictions, we have relied, with your permission, on the opinion of
[counsel for the Company], addressed to you and dated the date hereof, copies of
which have been delivered to you, and we have assumed, without independent
investigation, the correctness of the matters set forth in such opinions, our
opinion being subject to the assumptions, qualifications and limitations set
forth in such opinion with respect thereto. In addition, 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 Lender is located which
limits the rate of interest that such Lender 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,