Certain Letter of Credit Provisions. 5.3.1. If Merck shall fail to comply with its funding obligations under Section 5.1.7 with respect to either Settlement Fund, and Merck shall have failed to cure such failure within five (5) Business Days following receipt of written notice from the Claims Administrator to such effect, then the Claims Administrator may, at any time thereafter so long as such failure continues to exist, make a draw under the Letter of Credit (or, if more than one Letter of Credit is delivered to the Claims Administrator, make draws under each of such Letters of Credit in proportion to the respective “Maximum Draw Amounts” thereunder) in an aggregate amount equal to the amount necessary to cure such failure. The “Drawing Certificate” in respect of any such draw shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify the division of the proceeds of such draw between the MI Settlement Fund and the IS Settlement Fund, according to the respective amounts which Merck has failed to fund in relation to each such Fund. The Claims Administrator also will notify the Escrow Agent of such proper division. 5.3.2. If on or prior to the tenth Business Day prior to the “Expiration Date” of any Letter of Credit, Merck shall not have caused the issuing bank of such Letter of Credit to deliver an “Extension Notice” thereunder extending such Expiration Date, then the Claims Administrator shall on the next Business Day make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Non-Extension Drawing”). If the Claims Administrator makes draws under one or more Letters of Credit on three separate occasions with respect to three separate failures described in Section 5.3.1, then at any time thereafter when the Claims Administrator shall be entitled to make a further draw on a Letter of Credit pursuant to Section 5.3.1, the Claims Administrator in its discretion may make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Multiple Draw Drawing”). The “Drawing Certificate” in respect of any draw under this Section 5.3.2 shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify that the proceeds of such draw shall be allocated between the MI Settlement Fund and the IS Settlement Fund in proportion to the respective amounts of the MI Settlement Fund Top-up Amount and the IS Settlement Fund Top-up Amount (calculated at such time). The Claims Administrator also will notify the Escrow Agent of such proper division. 5.3.3. The Claims Administrator shall, within one (1) Business Day following delivery of any “Draw Certificate” under any the Letter of Credit, deliver a copy thereof to Merck by delivery via email of a PDF copy thereof, the NPC and the Escrow Agent. 5.3.4. The Escrow Agent shall notify the Claims Administrator of any deposit made by Merck into the MI Settlement Fund and/or the IS Settlement Fund pursuant to Section 5.1.7 and the aggregate amount of such deposit (the “Funding Amount”). Within one (1) Business Day following receipt of any such notice, the Claims Administrator shall deliver to the issuing bank under each outstanding Letter of Credit (i) a completed and signed “Reduction Certificate” specifying that the “Maximum Draw Amount” under such Letter of Credit shall be reduced by an aggregate amount equal to the Funding Amount (or, if more than one Letter of Credit is then outstanding, a portion of the Funding Amount equal to the product of the Funding Amount multiplied by a fraction of the numerator of which equals the “Maximum Draw Amount” at such time under such Letter of Credit and the dominator of which equals the aggregate “Maximum Draw Amount” at such time under all such Letters of Credit) and (ii) the original copy of such Letter of Credit (including the latest “Extension Notice” thereunder, if applicable). Any term of this Agreement to the contrary notwithstanding, Merck shall not be required to make any further Funding Payment under Section 5.1.7 until the Claims Administrator shall have complied with its obligations under this Section in respect of the immediately preceding Funding Payment by Merck under Section 5.1.7. 5.3.5. Merck may at any time or from time to time deliver to the Claims Administrator a new Letter of Credit in replacement of one or more then-outstanding Letter(s) of Credit, so long as such replacement Letter of Credit has an initial “Maximum Draw Amount” at least equal to the aggregate “Maximum Draw Amount” at the time under all of such Letter(s) of Credit being replaced, and in exchange therefor the Claims Administrator immediately shall surrender the replaced Letter(s) of Credit to Merck (or, at Merck’s direction, the respective issuing bank(s) under such Letter(s) of Credit) for cancellation. 5.3.6. If (i) any amounts are deposited in the Escrow Fund pursuant to a Non-Extension Drawing and (ii) Merck at any time thereafter causes a new Letter of Credit to be issued to the Claims Administrator (other than in replacement of a then- outstanding Letter of Credit pursuant to Section 5.3.5), then the Claims Administrator shall, within one (1) Business Day of the event described in clause (ii), direct the Escrow Agent to pay over to Merck an amount equal in the aggregate to the “Maximum Draw Amount” of such new Letter of Credit. The specific amounts to be paid over to Merck out of each of the MI Settlement Fund and the IS Settlement Fund pursuant to the preceding sentence shall be in such proportion so that, after giving effect to such payment over to Merck, the relative amounts of the MI Settlement Fund Top-Up Amount and the IS Settlement Fund Top-Up Amount shall be in the proportion of 82.4 to 17.6. The notice to the Escrow Agent pursuant to this Section shall specify that it is so being made pursuant to this Section. 5.3.7. If the Claims Administrator shall be replaced in accordance with this Agreement, then such former Claims Administrator shall, on the last Business Day on which such Claims Administrator acts as the “Claims Administrator” hereunder, deliver to the issuing bank under each then outstanding Letter of Credit (i) a completed and signed “Transfer Certificate” thereunder specifying the name and address of the successor to such Claims Administrator and (ii) the original copy of the Letter of Credit (including the latest “Extension Notice” thereunder, if applicable). 5.3.8. If the Maximum Draw Amount under any Letter of Credit shall be reduced to zero, or (if earlier) when all possible Settlement Payments have been paid in accordance with this Agreement, the Claims Administrator shall surrender such Letter of Credit to Merck (or, at Merck’s direction, the issuing bank under such Letter of Credit) for cancellation. 5.3.9. The lead arranger(s) for any Letter of Credit facility shall be a major money center bank.
Appears in 3 contracts
Samples: Settlement Agreement, Settlement Agreement, Settlement Agreement
Certain Letter of Credit Provisions. 5.3.1. If Merck shall fail to comply with its funding obligations under Section 5.1.7 with respect to either Settlement Fund, and Merck shall have failed to cure such failure within five (5a) Business Days following receipt Immediately upon the issuance of written notice from the Claims Administrator to such effect, then the Claims Administrator may, at any time thereafter so long as such failure continues to exist, make a draw under the each Letter of Credit (orfor the account of a Company, if more than one Letter of Credit is delivered to the Claims Administrator, make draws under each Applicable Lender of such Letters of Credit in proportion to Company shall be deemed to, and hereby severally agrees to, have irrevocably purchased from the respective “Maximum Draw Amounts” thereunder) in an aggregate amount equal to the amount necessary to cure such failure. The “Drawing Certificate” in respect of any such draw shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds Applicable Issuer of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify the division of the proceeds of such draw between the MI Settlement Fund and the IS Settlement Fund, according to the respective amounts which Merck has failed to fund Company a participation in relation to each such Fund. The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.2. If on or prior to the tenth Business Day prior to the “Expiration Date” of any Letter of Credit, Merck shall not have caused the issuing bank of such Letter of Credit to deliver an “Extension Notice” thereunder extending such Expiration Date, then the Claims Administrator shall on the next Business Day make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Non-Extension Drawing”). If the Claims Administrator makes draws under one or more Letters of Credit on three separate occasions with respect to three separate failures described in Section 5.3.1, then at any time thereafter when the Claims Administrator shall be entitled to make a further draw on a Letter of Credit pursuant to Section 5.3.1, the Claims Administrator in its discretion may make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Multiple Draw Drawing”). The “Drawing Certificate” in respect of any draw under this Section 5.3.2 shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify that the proceeds of such draw shall be allocated between the MI Settlement Fund and the IS Settlement Fund in proportion to the respective amounts of the MI Settlement Fund Top-up Amount and the IS Settlement Fund Top-up Amount (calculated at such time). The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.3. The Claims Administrator shall, within one (1) Business Day following delivery of any “Draw Certificate” under any the Letter of Credit, deliver a copy thereof to Merck by delivery via email of a PDF copy thereof, the NPC and the Escrow Agent.
5.3.4. The Escrow Agent shall notify the Claims Administrator of any deposit made by Merck into the MI Settlement Fund and/or the IS Settlement Fund pursuant to Section 5.1.7 and the aggregate amount of such deposit (the “Funding Amount”). Within one (1) Business Day following receipt of any such notice, the Claims Administrator shall deliver to the issuing bank under each outstanding Letter of Credit (i) a completed and signed “Reduction Certificate” specifying that the “Maximum Draw Amount” under such Letter of Credit shall be reduced by an aggregate amount equal to the Funding Amount (or, if more than one Letter of Credit is then outstanding, a portion of the Funding Amount equal to the product of the Funding Amount multiplied by a fraction of the numerator of which equals the “Maximum Draw Amount” at such time under such Letter of Credit and drawings thereunder in an amount equal to such Lender's Commitment Percentage of the dominator maximum amount which is or at any time may become available to be drawn thereunder, No Applicable Issuer of which equals the aggregate “Maximum Draw Amount” at a Company shall have any obligation to issue any Letter of Credit if any Applicable Lender of such time under all such Letters of Credit) and (ii) the original copy of Company has no obligation to participate in such Letter of Credit.
(b) In the event the Applicable Issuer of a Company has determined to honor a request for drawing under a Letter of Credit issued by it for the account of such Company, such Issuer shall immediately notify such Company and the Applicable Agent of such Company, and such Company shall reimburse such Issuer on or before the Business Day immediately following the date on which such drawing is honored (including such immediately following date, the latest “Extension Notice” thereunder"Disbursement -45- 52 Date") in same day funds equal to the amount of such drawing; provided, if applicable). Any term of that anything contained in this Agreement to the contrary notwithstanding, Merck (i) unless such Company shall not have notified its Applicable Agent and its Applicable Issuer prior to 10:00 a.m. (Chicago time) on the Disbursement Date that such Company intends to reimburse such Issuer for the amount of such drawing with funds other than the proceeds of Revolving Loans and such Company does so reimburse such Issuer, such Company shall be required deemed to have given a timely Notice of Borrowing to its Applicable Agent requesting such Company's Applicable Lenders to make Revolving Loans for the account of such Company on the Disbursement Date in an amount equal to the amount of such drawing (which Revolving Loans shall be Canadian Base Rate Loans in the case of the Canadian Company, and Base Rate Loans in the case of the U.S. Company) and (ii) subject to satisfaction or waiver of the conditions specified in Section 4.02, the Applicable Lenders of such Company shall, on the Disbursement Date, make Revolving Loans for the account of such Company in the aggregate amount of such drawing (which Revolving Loans shall be Canadian Base Rate Loans in the case of the Canadian Company, and Base Rate Loans in the case of the U.S. Company), the proceeds of which shall be applied directly by the Applicable Agent of such Company to reimburse the Applicable Issuer of such Company for the amount of such drawing; and provided, further that if for any further Funding Payment under Section 5.1.7 until reason proceeds of Revolving Loans are not received by such Applicable Issuer on the Claims Administrator Disbursement Date in an amount equal to the amount of such drawing, such Company shall reimburse such Applicable Issuer, on demand, in an amount in same day funds equal to the excess of the amount of such drawing over the aggregate amount of such Revolving Loans, if any, which are so received, together with interest thereon at a rate per annum equal to the rate per annum then in effect for Revolving Loans (comprised of Canadian Base Rate Loans in the case of the Canadian Company, and Base Rate Loans in the case of the U.S. Company) from the date of demand to the date of reimbursement. Nothing in this subsection 2.15(b) shall be deemed to relieve any Lender from its obligation to make Revolving Loans on the terms and conditions set forth in this Agreement, and each Company shall retain any and all rights it may have complied with its obligations against any Lender resulting from the failure of such Lender to make such Revolving Loans under this Section in respect of the immediately preceding Funding Payment by Merck under Section 5.1.7subsection 2.15(b).
5.3.5. Merck may at (c) In the event that a Company shall fail for any time or from time reason to time deliver reimburse its Applicable Issuer as provided in subsection 2.15(b) on the Disbursement Date in an amount equal to the Claims Administrator amount of any drawing honored by such Issuer under a new Letter of Credit issued by it, such Issuer shall promptly notify the Applicable Agent of such Company and such Agent shall promptly notify each Applicable Lender of such Company of the unreimbursed amount of such drawing and of such Lender's respective participation therein based on such Lender's Commitment Percentage. In such event, each Applicable Lender of such Company shall make available to the Applicable Issuer of such Company an amount equal to its respective participation in replacement same day funds, at the office of one or more then-outstanding Letter(ssuch Issuer specified in such notice, not later than 12:00 noon (Chicago time) on the first Business Day after the date notified by such Agent. In the event that any such Lender fails to make available to such Issuer on such Business Day the amount of Credit, so long as such replacement Lender's participation in such Letter of Credit has an initial “Maximum Draw Amount” as provided in this subsection 2.15(c), such Issuer shall be entitled to recover such amount on demand from such Lender together with interest thereon at least the rate per annum equal to the aggregate “Maximum Draw Amount” at Applicable Federal Funds Rate for and determined as of each day during such period. Nothing in this subsection 2.15(c) shall be deemed to relieve a Company from its obligation to reimburse its
(d) The obligation of a Company to reimburse its Applicable Issuer for drawings made under the time Letters of Credit issued by it for the account of such Company and to repay any Revolving Loans made by its Applicable Lenders pursuant to subsection 2.15(b) and the obligations of the Lenders under subsection 2.15(c) shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all of such Letter(s) of Credit being replacedcircumstances including, and in exchange therefor the Claims Administrator immediately shall surrender the replaced Letter(s) of Credit to Merck (or, at Merck’s directionwithout limitation, the respective issuing bank(s) under such Letter(s) of Credit) for cancellation.following circumstances:
5.3.6. If (i) any amounts are deposited in the Escrow Fund pursuant to a Non-Extension Drawing and lack of validity or enforceability of any Letter of Credit;
(ii) Merck the existence of any claim, set-off defense or other right which a Company or any Lender may have at any time thereafter causes against a new beneficiary or any transferee of any Letter of Credit to (or any Persons for whom any such transferee may be issued to acting), an Issuer or other Lender or any other Person or, in the Claims Administrator (other than in replacement case of a then- outstanding Letter of Credit pursuant to Section 5.3.5)Lender, then the Claims Administrator shallagainst a Company, within one (1) Business Day of the event described whether in clause (ii), direct the Escrow Agent to pay over to Merck an amount equal in the aggregate to the “Maximum Draw Amount” of such new Letter of Credit. The specific amounts to be paid over to Merck out of each of the MI Settlement Fund and the IS Settlement Fund pursuant to the preceding sentence shall be in such proportion so that, after giving effect to such payment over to Merck, the relative amounts of the MI Settlement Fund Top-Up Amount and the IS Settlement Fund Top-Up Amount shall be in the proportion of 82.4 to 17.6. The notice to the Escrow Agent pursuant to this Section shall specify that it is so being made pursuant to this Section.
5.3.7. If the Claims Administrator shall be replaced in accordance connection with this Agreement, then such former Claims Administrator shall, on the last Business Day on transactions contemplated herein or any unrelated transaction (including any underlying transaction between a Company or one of its Subsidiaries and the beneficiary for which such Claims Administrator acts as the “Claims Administrator” hereunder, deliver to the issuing bank under each then outstanding any Letter of Credit was procured);
(iiii) a completed and signed “Transfer Certificate” thereunder specifying the name and address of the successor to such Claims Administrator and (ii) the original copy of the Letter of Credit (including the latest “Extension Notice” thereunderany draft, if applicable).
5.3.8. If the Maximum Draw Amount demand, certificate or other document presented under any Letter of Credit proving to be forged, fraudulent invalid or insufficient in any respect or any statement therein being untrue or in any respect;
(iv) payment by an Issuer under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of a Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by any party thereto;
(vii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Default shall have occurred and be continuing; provided, however that after paying in full its obligation hereunder, nothing herein shall adversely affect the right of such Company or such Lender, as the case may be, to commence any proceeding against the Applicable Issuer of such Company for any wrongful disbursement made by such Issuer under a Letter of Credit as a result of acts or omissions constituting gross negligence or willful misconduct on the part of such Issuer.
(e) In addition to amounts payable as provided in subsection 2.15(b), each Company hereby agrees to protect, indemnify, pay and save harmless its Applicable Issuer and such Issuer's officers, employees or agents from and against any and all claims, demands, liabilities, damages, losses, and reasonable costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which such Issuer may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit by such Issuer, other than as a result of the gross negligence or willful misconduct of such Issuer or such Issuer's officers, employees or agents or (ii) the failure of such Issuer to honor a drawing under any such Letters of Credit as a result of any act or omission, whether rightful or wrongful, of any present or future Governmental Authority.
(f) As between a Company and its Applicable Issuer, such Company assumes all risks of the acts and omissions of, or misuse of the Letters of Credit issued by such Issuer by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, no Issuer shall be reduced responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of any such Letter of Credit, even if it should in fact prove to zerobe in any or all respects invalid, insufficient inaccurate, fraudulent or forged; (if earlierii) when all possible Settlement Payments have been paid the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in accordance with this Agreementwhole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the Claims Administrator shall surrender beneficiary of any such Letter of Credit to Merck comply fully with any conditions required in order to draw upon such Letter of Credit; (oriv) errors, at Merck’s directionomissions, interruptions, or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the issuing bank transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) for cancellation.
5.3.9. The lead arranger(s) for any Letter of Credit facility shall be a major money center bank.consequences arising from causes beyond the control of
Appears in 1 contract
Certain Letter of Credit Provisions. 5.3.1. If Merck shall fail to comply with its funding obligations under Section 5.1.7 with respect to either Settlement Fund, and Merck shall have failed to cure such failure within five (5a) Business Days following receipt Immediately upon the issuance of written notice from the Claims Administrator to such effect, then the Claims Administrator may, at any time thereafter so long as such failure continues to exist, make a draw under the Letter of Credit (or, if more than one Letter of Credit is delivered to the Claims Administrator, make draws under each of such Letters of Credit in proportion to the respective “Maximum Draw Amounts” thereunder) in an aggregate amount equal to the amount necessary to cure such failure. The “Drawing Certificate” in respect of any such draw shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify the division of the proceeds of such draw between the MI Settlement Fund and the IS Settlement Fund, according to the respective amounts which Merck has failed to fund in relation to each such Fund. The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.2. If on or prior to the tenth Business Day prior to the “Expiration Date” of any Letter of Credit, Merck shall not have caused the issuing bank of such Letter of Credit to deliver an “Extension Notice” thereunder extending such Expiration Date, then the Claims Administrator shall on the next Business Day make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Non-Extension Drawing”). If the Claims Administrator makes draws under one or more Letters of Credit on three separate occasions with respect to three separate failures described in Section 5.3.1, then at any time thereafter when the Claims Administrator each Lender shall be entitled to make deemed to, and hereby severally agrees to, have irrevocably purchased from the Issuer a further draw on a Letter of Credit pursuant to Section 5.3.1, the Claims Administrator participation in its discretion may make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Multiple Draw Drawing”). The “Drawing Certificate” in respect of any draw under this Section 5.3.2 shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify that the proceeds of such draw shall be allocated between the MI Settlement Fund and the IS Settlement Fund in proportion to the respective amounts of the MI Settlement Fund Top-up Amount and the IS Settlement Fund Top-up Amount (calculated at such time). The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.3. The Claims Administrator shall, within one (1) Business Day following delivery of any “Draw Certificate” under any the Letter of Credit, deliver a copy thereof to Merck by delivery via email of a PDF copy thereof, the NPC and the Escrow Agent.
5.3.4. The Escrow Agent shall notify the Claims Administrator of any deposit made by Merck into the MI Settlement Fund and/or the IS Settlement Fund pursuant to Section 5.1.7 and the aggregate amount of such deposit (the “Funding Amount”). Within one (1) Business Day following receipt of any such notice, the Claims Administrator shall deliver to the issuing bank under each outstanding Letter of Credit (i) a completed and signed “Reduction Certificate” specifying that the “Maximum Draw Amount” under such Letter of Credit shall be reduced by an aggregate amount equal to the Funding Amount (or, if more than one Letter of Credit is then outstanding, a portion of the Funding Amount equal to the product of the Funding Amount multiplied by a fraction of the numerator of which equals the “Maximum Draw Amount” at such time under such Letter of Credit and drawings thereunder in an amount equal to such Lender's Revolving Commitment Percentage of the dominator maximum amount which is or at any time may become available to be drawn thereunder. The Issuer shall not have any obligation to issue any Letter of which equals Credit if the aggregate “Maximum Draw Amount” at such time under all such Letters of Credit) and (ii) the original copy of Lenders have no obligation to participate in such Letter of Credit.
(b) In the event the Issuer has determined to honor a request for drawing under a Letter of Credit issued by it, the Issuer shall immediately notify the Company and the Administrative Agent, and the Company shall reimburse the Issuer on or before the Business Day immediately following the date on which such drawing is honored (including such immediately following date, the latest “Extension Notice” thereunder"Disbursement Date") in same day funds equal to the amount of such drawing; PROVIDED, if applicable). Any term of that, anything contained in this Agreement to the contrary notwithstanding, Merck (i) unless the Company shall not have notified the Administrative Agent and the Issuer prior to 11:00 a.m. (Chicago time) on the Disbursement Date that the Company intends to reimburse the Issuer for the amount of such drawing with funds other than the proceeds of Revolving Loans and the Company does so reimburse the Issuer prior to 11:00 a.m. (Chicago time) on the Disbursement Date, the Company shall be required deemed to have given a timely Notice of Borrowing to the Administrative Agent requesting the Lenders to make Revolving Loans that are Base Rate Loans on the Disbursement Date in an amount equal to the amount of such drawing and (ii) subject to satisfaction or waiver of the conditions specified in Section 4.2, the Lenders shall, on the Disbursement Date, make Revolving Loans that are Base Rate Loans in the amount of such drawing, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the Issuer for the amount of such drawing; and PROVIDED, FURTHER that if for any further Funding Payment reason proceeds of Revolving Loans are not received by the Issuer on the Disbursement Date in an amount equal to the amount of such drawing, the Company shall reimburse the Issuer, on demand, in an amount in same day funds equal to the excess of the amount of such drawing over the aggregate amount of such Revolving Loans, if any, which are so received, together with interest thereon at a rate per annum equal to the rate per annum then in effect for Base Rate -40- Revolving Loans pursuant to Section 2.9 from the date of demand to the date of reimbursement. Nothing in this subsection 2.15(b) shall be deemed to relieve any Lender from its obligation to make Revolving Loans on the terms and conditions set forth in this Agreement, and the Company shall retain any and all rights it may have against any Lender resulting from the failure of such Lender to make such Revolving Loans under Section 5.1.7 until this subsection 2.15(b).
(c) In the Claims Administrator event that the Company shall fail for any reason to reimburse the Issuer as provided in subsection 2.15(b) on the Disbursement Date in an amount equal to the amount of any drawing honored by the Issuer under a Letter of Credit issued by it, the Issuer shall promptly notify the Administrative Agent and the Administrative Agent shall promptly notify each Lender of the unreimbursed amount of such drawing and of such Lender's respective participation therein based on such Lender's Revolving Commitment Percentage. In such event, each Lender shall make available to the Issuer an amount equal to its respective participation in same day funds, at the office of the Issuer specified in such notice, not later than 11:00 a.m. (Chicago time) on the first Business Day after the date notified by the Issuer. In the event that any Lender fails to make available to the Issuer on such Business Day the amount of such Lender's participation in such Letter of Credit as provided in this subsection 2.15(c), the Issuer shall be entitled to recover such amount on demand from such Lender together with interest thereon at the rate per annum equal to the Federal Funds Rate for and determined as of each day during such period. Nothing in this subsection 2.15(c) shall be deemed to relieve the Company from its obligation to reimburse the Issuer as provided in subsection 2.15(b). In the event the Issuer shall have complied with its obligations been reimbursed by Lenders pursuant to this subsection 2.15(c) for all or any portion of any drawing honored by the Issuer under a Letter of Credit issued by it, the Issuer shall distribute to each Lender which has paid all amounts payable by it under this Section subsection 2.15(c) with respect to such drawing such Lender's Revolving Commitment Percentage of all payments subsequently received by the Issuer from the Company in reimbursement of such drawing when such payments are received. Promptly upon receipt by the Issuer of any payment of interest in respect of the immediately preceding Funding Payment Company's reimbursement obligation pursuant to subsection 2.15(b) with respect to a drawing, in the event the Issuer shall have been reimbursed by Merck any Lender pursuant to this subsection 2.15(c) for all or any portion of such drawing, the Issuer shall distribute to such Lender which has paid all amounts payable by it under Section 5.1.7this subsection 2.15(c) with respect to such drawing such Lender's Revolving Commitment Percentage of any interest received by the Issuer in respect of that portion of such drawing so reimbursed by such Lender.
5.3.5. Merck may at any time or from time (d) The obligation of the Company to time deliver to reimburse the Claims Administrator a new Letter Issuer for drawings made under the Letters of Credit issued by it and to repay any Revolving Loans made by the Lenders pursuant to subsection 2.15(b) and the obligations of the Lenders under subsection 2.15(c) shall be unconditional and irrevocable and shall be paid strictly in replacement accordance with the terms of one or more then-outstanding Letter(s) of Credit, so long as such replacement Letter of Credit has an initial “Maximum Draw Amount” at least equal to the aggregate “Maximum Draw Amount” at the time this Agreement under all of such Letter(s) of Credit being replacedcircumstances including, and in exchange therefor the Claims Administrator immediately shall surrender the replaced Letter(s) of Credit to Merck (or, at Merck’s directionwithout limitation, the respective issuing bank(s) under such Letter(s) of Credit) for cancellation.following circumstances:
5.3.6. If (i) any amounts are deposited in the Escrow Fund pursuant to a Non-Extension Drawing and lack of validity or enforceability of any Letter of Credit;
(ii) Merck the existence of any claim, set-off, defense or other right which the Company or any Lender may have at any time thereafter causes against a new beneficiary or any transferee of any Letter of Credit to (or any Persons for whom any such transferee may be issued to acting), the Claims Administrator (Issuer or other than Lender or any other Person or, in replacement the case of a then- outstanding Letter of Credit pursuant to Section 5.3.5)Lender, then against the Claims Administrator shallCompany, within one (1) Business Day of the event described whether in clause (ii), direct the Escrow Agent to pay over to Merck an amount equal in the aggregate to the “Maximum Draw Amount” of such new Letter of Credit. The specific amounts to be paid over to Merck out of each of the MI Settlement Fund and the IS Settlement Fund pursuant to the preceding sentence shall be in such proportion so that, after giving effect to such payment over to Merck, the relative amounts of the MI Settlement Fund Top-Up Amount and the IS Settlement Fund Top-Up Amount shall be in the proportion of 82.4 to 17.6. The notice to the Escrow Agent pursuant to this Section shall specify that it is so being made pursuant to this Section.
5.3.7. If the Claims Administrator shall be replaced in accordance connection with this Agreement, then such former Claims Administrator shall, on the last Business Day on transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Company or one of its Subsidiaries and the beneficiary for which such Claims Administrator acts as the “Claims Administrator” hereunder, deliver to the issuing bank under each then outstanding any Letter of Credit was procured);
(iiii) a completed and signed “Transfer Certificate” thereunder specifying the name and address of the successor to such Claims Administrator and (ii) the original copy of the Letter of Credit (including the latest “Extension Notice” thereunderany draft, if applicable).
5.3.8. If the Maximum Draw Amount demand, certificate or other document presented under any Letter of Credit shall proving to be reduced to zeroforged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(if earlieriv) when all possible Settlement Payments have been paid in accordance payment by the Issuer under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with this Agreement, the Claims Administrator shall surrender terms of such Letter of Credit (absent the Issuer's gross negligence or willful misconduct);
(v) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by any party thereto;
(vii) any other circumstance or happening whatsoever, whether or not similar to Merck any of the foregoing; or
(orviii) the fact that an Event of Default or a Default shall have occurred and be continuing; PROVIDED, at Merck’s directionHOWEVER, that after paying in full its obligation hereunder, nothing herein shall adversely affect the right of the Company or such Lender, as the case may be, to commence any proceeding against the Issuer for any wrongful disbursement made by the Issuer under a Letter of Credit as a result of acts or omissions constituting gross negligence or willful misconduct on the part of the Issuer.
(e) In addition to amounts payable as provided in subsection 2.15(b), the issuing bank under such Letter Company hereby agrees to protect, indemnify, pay and save harmless the Issuer and its officers, employees or agents from and against any and all claims, demands, liabilities, damages, losses, and reasonable costs, charges and expenses (including reasonable fees, expenses and disbursements of Creditcounsel) for cancellation.
5.3.9. The lead arranger(swhich the Issuer may incur or be subject to as a consequence, direct or indirect, of (i) for the issuance of any Letter of Credit facility shall be by the Issuer, other than as a major money center bank.result of the gross negligence or willful misconduct of the Issuer or its officers, employees or agents as determined by a final judgment of a court of competent jurisdiction or -42-
Appears in 1 contract
Samples: Credit Agreement (LKQ Corp)
Certain Letter of Credit Provisions. 5.3.1. If Merck shall fail to comply with its funding obligations under Section 5.1.7 with respect to either Settlement Fund, and Merck shall have failed to cure such failure within five (5) Business Days following receipt of written notice from the Claims Administrator to such effect, then the Claims Administrator may, at any time thereafter so long as such failure continues to exist, make a draw under the Letter of Credit (or, if more than one Letter of Credit is delivered to the Claims Administrator, make draws under each of such Letters of Credit in proportion to the respective “Maximum Draw Amounts” thereunder) in an aggregate amount equal to the amount necessary to cure such failure. The “Drawing Certificate” in respect of any such draw shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify the division of the proceeds of such draw between the MI Settlement Fund and the IS Settlement Fund, according to the respective amounts which Merck has failed to fund in relation to each such Fund. The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.2. If on or prior to the tenth Business Day prior to the “Expiration Date” of any Letter of Credit, Merck shall not have caused the issuing bank of such Letter of Credit to deliver an “Extension Notice” thereunder extending such Expiration Date, then the Claims Administrator shall on the next Business Day make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Non-Extension Drawing”” ). If the Claims Administrator makes draws under one or more Letters of Credit on three separate occasions with respect to three separate failures described in Section 5.3.1, then at any time thereafter when the Claims Administrator shall be entitled to make a further draw on a Letter of Credit pursuant to Section 5.3.1, the Claims Administrator in its discretion may make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Multiple Draw Drawing”” ). The “Drawing Certificate” in respect of any draw under this Section 5.3.2 shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify that the proceeds of such draw shall be allocated between the MI Settlement Fund and the IS Settlement Fund in proportion to the respective amounts of the MI Settlement Fund Top-up Amount and the IS Settlement Fund Top-up Amount (calculated at such time). The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.3. The Claims Administrator shall, within one (1) Business Day following delivery of any “Draw Certificate” under any the Letter of Credit, deliver a copy thereof to Merck by delivery via email of a PDF copy thereof, the NPC and the Escrow Agent.
5.3.4. The Escrow Agent shall notify the Claims Administrator of any deposit made by Merck into the MI Settlement Fund and/or the IS Settlement Fund pursuant to Section 5.1.7 and the aggregate amount of such deposit (the “Funding Amount”” ). Within one (1) Business Day following receipt of any such notice, the Claims Administrator shall deliver to the issuing bank under each outstanding Letter of Credit (i) a completed and signed “Reduction Certificate” specifying that the “Maximum Draw Amount” under such Letter of Credit shall be reduced by an aggregate amount equal to the Funding Amount (or, if more than one Letter of Credit is then outstanding, a portion of the Funding Amount equal to the product of the Funding Amount multiplied by a fraction of the numerator of which equals the “Maximum Draw Amount” at such time under such Letter of Credit and the dominator of which equals the aggregate “Maximum Draw Amount” at such time under all such Letters of Credit) and (ii) the original copy of such Letter of Credit (including the latest “Extension Notice” thereunder, if applicable). Any term of this Agreement to the contrary notwithstanding, Merck shall not be required to make any further Funding Payment under Section 5.1.7 until the Claims Administrator shall have complied with its obligations under this Section in respect of the immediately preceding Funding Payment by Merck under Section 5.1.7.
5.3.5. Merck may at any time or from time to time deliver to the Claims Administrator a new Letter of Credit in replacement of one or more then-outstanding Letter(s) of Credit, so long as such replacement Letter of Credit has an initial “Maximum Draw Amount” at least equal to the aggregate “Maximum Draw Amount” at the time under all of such Letter(s) of Credit being replaced, and in exchange therefor the Claims Administrator immediately shall surrender the replaced Letter(s) of Credit to Merck (or, at Merck’s direction, the respective issuing bank(s) under such Letter(s) of Credit) for cancellation.
5.3.6. If (i) any amounts are deposited in the Escrow Fund pursuant to a Non-Extension Drawing and (ii) Merck at any time thereafter causes a new Letter of Credit to be issued to the Claims Administrator (other than in replacement of a then- then-outstanding Letter of Credit pursuant to Section 5.3.5), then the Claims Administrator shall, within one (1) Business Day of the event described in clause (ii), direct the Escrow Agent to pay over to Merck an amount equal in the aggregate to the “Maximum Draw Amount” of such new Letter of Credit. The specific amounts to be paid over to Merck out of each of the MI Settlement Fund and the IS Settlement Fund pursuant to the preceding sentence shall be in such proportion so that, after giving effect to such payment over to Merck, the relative amounts of the MI Settlement Fund Top-Up Amount and the IS Settlement Fund Top-Up Amount shall be in the proportion of 82.4 to 17.6. The notice to the Escrow Agent pursuant to this Section shall specify that it is so being made pursuant to this Section.
5.3.7. If the Claims Administrator shall be replaced in accordance with this Agreement, then such former Claims Administrator shall, on the last Business Day on which such Claims Administrator acts as the “Claims Administrator” hereunder, deliver to the issuing bank under each then outstanding Letter of Credit (i) a completed and signed “Transfer Certificate” thereunder specifying the name and address of the successor to such Claims Administrator and (ii) the original copy of the Letter of Credit (including the latest “Extension Notice” thereunder, if applicable).
5.3.8. If the Maximum Draw Amount under any Letter of Credit shall be reduced to zero, or (if earlier) when all possible Settlement Payments have been paid in accordance with this Agreement, the Claims Administrator shall surrender such Letter of Credit to Merck (or, at Merck’s direction, the issuing bank under such Letter of Credit) for cancellation.
5.3.9. The lead arranger(s) for any Letter of Credit facility shall be a major money center bank.
Appears in 1 contract
Certain Letter of Credit Provisions. 5.3.1. If Merck shall fail to comply with its funding obligations under Section 5.1.7 with respect to either Settlement Fund, and Merck shall have failed to cure such failure within five (5a) Business Days following receipt Immediately upon the issuance of written notice from the Claims Administrator to such effect, then the Claims Administrator may, at any time thereafter so long as such failure continues to exist, make a draw under the Letter of Credit (or, if more than one Letter of Credit is delivered to the Claims Administrator, make draws under each of such Letters of Credit in proportion to the respective “Maximum Draw Amounts” thereunder) in an aggregate amount equal to the amount necessary to cure such failure. The “Drawing Certificate” in respect of any such draw shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify the division of the proceeds of such draw between the MI Settlement Fund and the IS Settlement Fund, according to the respective amounts which Merck has failed to fund in relation to each such Fund. The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.2. If on or prior to the tenth Business Day prior to the “Expiration Date” of any Letter of Credit, Merck shall not have caused the issuing bank of such Letter of Credit to deliver an “Extension Notice” thereunder extending such Expiration Date, then the Claims Administrator shall on the next Business Day make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Non-Extension Drawing”). If the Claims Administrator makes draws under one or more Letters of Credit on three separate occasions with respect to three separate failures described in Section 5.3.1, then at any time thereafter when the Claims Administrator each Lender shall be entitled to make deemed to, and hereby severally agrees to, have irrevocably purchased from the Issuer a further draw on a Letter of Credit pursuant to Section 5.3.1, the Claims Administrator participation in its discretion may make a draw under such Letter of Credit in the full amount of the “Maximum Draw Amount” thereunder (any such draw, a “Multiple Draw Drawing”). The “Drawing Certificate” in respect of any draw under this Section 5.3.2 shall (among other things required by such Certificate) (i) properly specify the instructions in order for the proceeds of such draw to be transferred directly to the Escrow Agent for deposit into the Escrow Fund and (ii) specify that the proceeds of such draw shall be allocated between the MI Settlement Fund and the IS Settlement Fund in proportion to the respective amounts of the MI Settlement Fund Top-up Amount and the IS Settlement Fund Top-up Amount (calculated at such time). The Claims Administrator also will notify the Escrow Agent of such proper division.
5.3.3. The Claims Administrator shall, within one (1) Business Day following delivery of any “Draw Certificate” under any the Letter of Credit, deliver a copy thereof to Merck by delivery via email of a PDF copy thereof, the NPC and the Escrow Agent.
5.3.4. The Escrow Agent shall notify the Claims Administrator of any deposit made by Merck into the MI Settlement Fund and/or the IS Settlement Fund pursuant to Section 5.1.7 and the aggregate amount of such deposit (the “Funding Amount”). Within one (1) Business Day following receipt of any such notice, the Claims Administrator shall deliver to the issuing bank under each outstanding Letter of Credit (i) a completed and signed “Reduction Certificate” specifying that the “Maximum Draw Amount” under such Letter of Credit shall be reduced by an aggregate amount equal to the Funding Amount (or, if more than one Letter of Credit is then outstanding, a portion of the Funding Amount equal to the product of the Funding Amount multiplied by a fraction of the numerator of which equals the “Maximum Draw Amount” at such time under such Letter of Credit and drawings thereunder in an amount equal to such Lender’s Commitment Percentage of the dominator maximum amount which is or at any time may become available to be drawn thereunder. The Issuer shall not have any obligation to issue any Letter of which equals Credit if the aggregate “Maximum Draw Amount” at such time under all such Letters of Credit) and (ii) the original copy of Lenders have no obligation to participate in such Letter of Credit.
(b) In the event the Issuer has determined to honor a request for drawing under a Letter of Credit issued by it, the Issuer shall immediately notify the Company and the Administrative Agent, and the Company shall reimburse the Issuer on or before the Business Day immediately following the date on which such drawing is honored (including such immediately following date, the latest “Extension Notice” thereunderDisbursement Date”) in same day funds equal to the amount of such drawing; provided, if applicable). Any term of that, anything contained in this Agreement to the contrary notwithstanding, Merck (i) unless the Company shall not have notified the Administrative Agent and the Issuer prior to 11:00 a.m. (Chicago time) on the Disbursement Date that the Company intends to reimburse the Issuer for the amount of such drawing with funds other than the proceeds of Revolving Loans and the Company does so reimburse the Issuer prior to 11:00 a.m. (Chicago time) on the Disbursement Date, the Company shall be required deemed to have given a timely Notice of Borrowing to the Administrative Agent requesting the Lenders to make Revolving Loans that are Base Rate Loans on the Disbursement Date in an amount equal to the amount of such drawing and (ii) subject to satisfaction or waiver of the conditions specified in Section 4.2, the Lenders shall, on the Disbursement Date, make Revolving Loans that are Base Rate Loans in the amount of such drawing, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the Issuer for the amount of such drawing; and provided, further that if for any further Funding Payment reason proceeds of Revolving Loans are not received by the Issuer on the Disbursement Date in an amount equal to the amount of such drawing, the Company shall reimburse the Issuer, on demand, in an amount in same day funds equal to the excess of the amount of such drawing over the aggregate amount of such Revolving Loans, if any, which are so received, together with interest thereon at a rate per annum equal to the rate per annum then in effect for Base Rate Revolving Loans pursuant to Section 2.9 from the date of demand to the date of reimbursement. Nothing in this subsection 2.15(b) shall be deemed to relieve any Lender from its obligation to make Revolving Loans on the terms and conditions set forth in this Agreement, and the Company shall retain any and all rights it may have against any Lender resulting from the failure of such Lender to make such Revolving Loans under Section 5.1.7 until this subsection 2.15(b).
(c) In the Claims Administrator event that the Company shall fail for any reason to reimburse the Issuer as provided in subsection 2.15(b) on the Disbursement Date in an amount equal to the amount of any drawing honored by the Issuer under a Letter of Credit issued by it, the Issuer shall promptly notify the Administrative Agent and the Administrative Agent shall promptly notify each Lender of the unreimbursed amount of such drawing and of such Lender’s respective participation therein based on such Lender’s Commitment Percentage. In such event, each Lender shall make available to the Issuer an amount equal to its respective participation in same day funds, at the office of the Issuer specified in such notice, not later than 11:00 a.m. (Chicago time) on the first Business Day after the date notified by the Issuer. In the event that any Lender fails to make available to the Issuer on such Business Day the amount of such Lender’s participation in such Letter of Credit as provided in this subsection 2.15(c), the Issuer shall be entitled to recover such amount on demand from such Lender together with interest thereon at the rate per annum equal to the Federal Funds Rate for and determined as of each day during such period. Nothing in this subsection 2.15(c) shall be deemed to relieve the Company from its obligation to reimburse the Issuer as provided in subsection 2.15(b). In the event the Issuer shall have complied with its obligations been reimbursed by Lenders pursuant to this subsection 2.15(c) for all or any portion of any drawing honored by the Issuer under a Letter of Credit issued by it, the Issuer shall distribute to each Lender which has paid all amounts payable by it under this Section subsection 2.15(c) with respect to such drawing such Lender’s Commitment Percentage of all payments subsequently received by the Issuer from the Company in reimbursement of such drawing when such payments are received. Promptly upon receipt by the Issuer of any payment of interest in respect of the immediately preceding Funding Payment Company’s reimbursement obligation pursuant to subsection 2.15(b) with respect to a drawing, in the event the Issuer shall have been reimbursed by Merck any Lender pursuant to this subsection 2.15(c) for all or any portion of such drawing, the Issuer shall distribute to such Lender which has paid all amounts payable by it under Section 5.1.7this subsection 2.15(c) with respect to such drawing such Lender’s Commitment Percentage of any interest received by the Issuer in respect of that portion of such drawing so reimbursed by such Lender.
5.3.5. Merck may at any time or from time (d) The obligation of the Company to time deliver to reimburse the Claims Administrator a new Letter Issuer for drawings made under the Letters of Credit issued by it and to repay any Revolving Loans made by the Lenders pursuant to subsection 2.15(b) and the obligations of the Lenders under subsection 2.15(c) shall be unconditional and irrevocable and shall be paid strictly in replacement accordance with the terms of one or more then-outstanding Letter(s) of Credit, so long as such replacement Letter of Credit has an initial “Maximum Draw Amount” at least equal to the aggregate “Maximum Draw Amount” at the time this Agreement under all of such Letter(s) of Credit being replacedcircumstances including, and in exchange therefor the Claims Administrator immediately shall surrender the replaced Letter(s) of Credit to Merck (or, at Merck’s directionwithout limitation, the respective issuing bank(s) under such Letter(s) of Credit) for cancellation.following circumstances:
5.3.6. If (i) any amounts are deposited in the Escrow Fund pursuant to a Non-Extension Drawing and lack of validity or enforceability of any Letter of Credit;
(ii) Merck the existence of any claim, set-off, defense or other right which the Company or any Lender may have at any time thereafter causes against a new beneficiary or any transferee of any Letter of Credit to (or any Persons for whom any such transferee may be issued to acting), the Claims Administrator (Issuer or other than Lender or any other Person or, in replacement the case of a then- outstanding Letter of Credit pursuant to Section 5.3.5)Lender, then against the Claims Administrator shallCompany, within one (1) Business Day of the event described whether in clause (ii), direct the Escrow Agent to pay over to Merck an amount equal in the aggregate to the “Maximum Draw Amount” of such new Letter of Credit. The specific amounts to be paid over to Merck out of each of the MI Settlement Fund and the IS Settlement Fund pursuant to the preceding sentence shall be in such proportion so that, after giving effect to such payment over to Merck, the relative amounts of the MI Settlement Fund Top-Up Amount and the IS Settlement Fund Top-Up Amount shall be in the proportion of 82.4 to 17.6. The notice to the Escrow Agent pursuant to this Section shall specify that it is so being made pursuant to this Section.
5.3.7. If the Claims Administrator shall be replaced in accordance connection with this Agreement, then such former Claims Administrator shall, on the last Business Day on transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Company or one of its Subsidiaries and the beneficiary for which such Claims Administrator acts as the “Claims Administrator” hereunder, deliver to the issuing bank under each then outstanding any Letter of Credit was procured);
(iiii) a completed and signed “Transfer Certificate” thereunder specifying the name and address of the successor to such Claims Administrator and (ii) the original copy of the Letter of Credit (including the latest “Extension Notice” thereunderany draft, if applicable).
5.3.8. If the Maximum Draw Amount demand, certificate or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(iv) payment by the Issuer under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit (absent the Issuer’s gross negligence or willful misconduct);
(v) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by any party thereto;
(vii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Default shall have occurred and be reduced continuing; provided, however, that after paying in full its obligation hereunder, nothing herein shall adversely affect the right of the Company or such Lender, as the case may be, to zerocommence any proceeding against the Issuer for any wrongful disbursement made by the Issuer under a Letter of Credit as a result of acts or omissions constituting gross negligence or willful misconduct on the part of the Issuer.
(e) In addition to amounts payable as provided in subsection 2.15(b), the Company hereby agrees to protect, indemnify, pay and save harmless the Issuer and its officers, employees or agents from and against any and all claims, demands, liabilities, damages, losses, and reasonable costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which the Issuer may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit by the Issuer, other than as a result of the gross negligence or willful misconduct of the Issuer or its officers, employees or agents as determined by a final judgment of a court of competent jurisdiction or (ii) the failure of the Issuer to honor a drawing under any such Letter of Credit as a result of any act or omission, whether rightful or wrongful, of any present or future Governmental Authority.
(f) As between the Company and the Issuer, the Company assumes all risks of the acts and omissions of, or (if earlier) when all possible Settlement Payments have been paid in accordance with this Agreementmisuse of the Letters of Credit issued by the Issuer by, the Claims Administrator respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, the Issuer shall surrender not be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any such Letter of Credit to Merck comply fully with any conditions required in order to draw upon such Letter of Credit; (oriv) errors, at Merck’s directionomissions, interruptions, or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the issuing bank transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) for cancellation.
5.3.9any consequences arising from causes beyond the control of the Issuer; and none of the above shall affect or impair, or prevent the vesting of, any of the Issuer’s rights or powers hereunder. The lead arranger(s) In furtherance and extension and not in limitation of the specific provisions set forth in the first paragraph of this subsection 2.15(f), any action taken or omitted by the Issuer under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall not put the Issuer under any resulting liability to the Company. Notwithstanding anything to the contrary contained in this subsection 2.15(f), the Company shall retain any and all rights it may have against the Issuer and its officers, employees or agents for any Letter liability arising out of Credit facility shall be a major money center bankthe gross negligence or willful misconduct of the Issuer or its officers, employees or agents.
Appears in 1 contract
Samples: Credit Agreement (LKQ Corp)
