EXHIBIT 10.57
Execution Copy
US$100,000,000
FIVE-YEAR
CANADIAN CREDIT AGREEMENT
dated as of
December 22, 1997
among
International Minerals &
Chemical (Canada) Global Limited
IMC Kalium Canada Ltd.
IMC Global Inc.,
The Banks Listed Herein,
and
Royal Bank of Canada,
as Agent,
Royal Bank of Canada,
Arranger
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS
1.1 Definitions 1
1.2 Accounting Terms and Determinations 15
1.3 Types of Borrowings 15
1.4 Currency 15
1.5 Amendments to Agreements and Laws 16
1.6 Several Liability 16
1.7 Interest Rates and Fees 16
ARTICLE 2
THE CREDITS
2.1 Commitments 16
2.2 Notice of Syndicated or Swingline Borrowings 17
2.3 Notice to Banks; Funding of Advances 18
2.4 Registry 19
2.5 Maturity of Loans 20
2.6 Interest Rates 20
2.7 Fees 21
2.8 Optional Termination or Reduction of Commitments 22
2.9 Conversion or Rollover of Syndicated Advances 23
2.10 Scheduled Termination of Commitments 25
2.11 Optional Prepayments. 25
2.12 General Provisions as to Payments 25
2.13 Funding Losses 26
2.14 Computation of Interest and Fees 27
2.15 Additional Bankers' Acceptances Provisions 27
2.16 Letters of Credit. 29
2.17 Takeout of Swingline Loans 32
2.18 Currency Fluctuations 33
2.19 Criminal Rate of Interest 34
2.20 Compliance with the Interest Act (Canada) 34
ARTICLE 3
CONDITIONS
3.1 Effectiveness 34
3.2 Borrowings and Issuance of Letters of Credits 35
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1 Borrowers 36
4.2 Guarantor 38
ARTICLE 5
COVENANTS
5.1 Borrowers 40
5.2 Guarantor 45
ARTICLE 6
DEFAULTS
6.1 Events of Default 50
6.2 Notice of Default 53
6.3 Cash Cover 53
ARTICLE 7
THE AGENT
7.1 Appointment and Authorization 53
7.2 Agent and Affiliates 54
7.3 Action by Agent 54
7.4 Consultation with Experts 54
7.5 Liability of Agent 54
7.6 Indemnification 54
7.7 Credit Decision 55
7.8 Successor Agent 55
7.9 Agent's Fees 55
7.10 Other Agents 55
8.1 Basis for Determining Interest Rate Inadequate or Unfair55
8.2 Illegality 56
8.3 Increased Costs 57
8.4 Taxes 58
8.5 No Market for Bankers' Acceptance 59
8.6 USBR Loans Substituted for Affected Euro-Dollar Loans 59
8.7 Substitution of Bank 60
ARTICLE 9
GUARANTEE
9.1 The Guarantee 60
9.2 Guarantee Unconditional 61
9.3 Discharge Only Upon Payment In Full; Reinstatement
In Certain Circumstances 61
9.4 Waiver by the Guarantor 62
9.5 Subrogation 62
9.6 Stay of Acceleration 62
9.7 Foreign Currency Obligations 62
ARTICLE 10
MISCELLANEOUS
10.1 Notices 63
10.2 Reliance on Verbal Instructions 63
10.3 No Waivers 63
10.4 Expenses; Indemnification 63
10.5 Set-off, Etc 64
10.6 Sharing of Set-offs 65
10.7 Foreign Currency Judgments 65
10.8 Amendments and Waivers 65
10.9 Successors and Assigns 66
10.10Confidentiality 67
10.11Further Assurances 68
10.12Governing Law; Submission to Jurisdiction 68
10.13Counterparts; Integration 69
SCHEDULES
Pricing Schedule
Schedule I - Existing Credit Agreements
Schedule II - Addresses for Notice
EXHIBITS
Exhibit A - Notice of Borrowing
Exhibit B - Notice of Conversion and Rollover
Exhibit C - Acceptance Note
Exhibit D - Assignment and Assumption Agreement
Exhibit E-1 - Form of Opinion of Fraser & Xxxxxx
Exhibit E-2 - Form of Opinion of Sidley & Austin
Exhibit E-3 - Form of Opinion of Xxxxxxxxx X. Xxxxx
Exhibit F-1 - Form of Bankers' Acceptance Power of Attorney
Exhibit F-2 - Form of Acceptance Notes Power of Attorney
FIVE-YEAR
CANADIAN CREDIT AGREEMENT
FIVE-YEAR CANADIAN CREDIT AGREEMENT dated as of December 22, 1997
among INTERNATIONAL MINERALS & CHEMICAL (CANADA) GLOBAL LIMITED, IMC
KALIUM CANADA LTD., IMC GLOBAL INC., the BANKS listed on the signature
pages hereof, and ROYAL BANK OF CANADA, as Agent.
The parties hereto agree as follows:
ARTICLE
DEFINITIONS
1.1 Definitions. The following terms, as used herein, have the
following meanings:
"Acceptance Note" has the meaning ascribed thereto in Section
2.15(h).
"Acceptance Note Bank" has the meaning ascribed thereto in Section
2.15(h).
"Acquisition" means an acquisition by the Guarantor or any of its
Consolidated Subsidiaries (including, without limitation, either or
both of the Borrowers) of a company, a division, a location or a line
of business or of all or substantially all of the assets of any of the
foregoing.
"Advances" means Loans and Bankers' Acceptance Advances and
"Advance" means either a Loan or a Bankers' Acceptance as the context
may require.
"Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls the Guarantor (a
"Controlling Person") or (ii) any Person (other than the Guarantor or a
Subsidiary of the Guarantor) which is controlled by or is under common
control with a Controlling Person. As used herein, the term "control"
means possession, directly or indirectly, of the power to vote 10% or
more of any class of voting securities of a Person or to direct or
cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" means Royal Bank of Canada in its capacity as Agent for
the Banks hereunder, and its successors in such capacity.
"Agrico" means IMC-Agrico Company, a Delaware general partnership,
and its successors.
"Applicable BA Discount Rate":
with respect to any Schedule I Bank, as applicable to a
Bankers' Acceptance being purchased by such Schedule I Bank
on any day, the CDOR Rate determined by the Agent to be in
effect on such day with respect to such Bankers' Acceptance;
and
with respect to any Bank other than a Schedule I Bank,
as applicable to a Bankers' Acceptance being purchased by
such other Bank on any day, the lesser of (i) the arithmetic
average (as determined by the Agent) of the respective
percentage discount rates (expressed to two decimal places
and rounded upward, if necessary, to the nearest 1/100th of
1%) quoted to the Agent by each Schedule II Reference Bank as
the percentage discount rate at which such Schedule II
Reference Bank would, in accordance with its normal
practices, at or about 10:00 A.M. (Toronto time), on such
day, be prepared to purchase bankers' acceptances accepted by
such Schedule II Reference Bank having a term comparable to
the term of such Bankers' Acceptance and (ii) the rate
determined pursuant to clause (a) of this definition in
connection with the relevant issuance of Bankers' Acceptances
plus 0.10% per annum.
"Applicable Lending Office" means, with respect to any Bank its
principal lending office in Canada as designated by such Bank to the
Agent.
"Approved Officer" means the president, the chief financial
officer, the acting chief financial officer, the treasurer, a vice
president, an assistant treasurer or the controller of the Borrower or
the Guarantor, as the case may be, or such other representative of the
Borrower or the Guarantor, as the case may be, as may be designated by
any one of the foregoing, from time to time, with the consent of the
Agent.
"Assignee" has the meaning set forth in Section 10.9(c).
"BA Discount Proceeds" means, in respect of any Bankers'
Acceptance to be purchased by a Bank on any day under Section 2.15(d),
an amount (rounded to the nearest whole Canadian cent, and with
one-half of one Canadian cent being rounded up) calculated on such day
by dividing:
the face amount of such Bankers' Acceptance; by
the sum of one plus the product of:
the Applicable BA Discount Rate (expressed as
a decimal) applicable to such Bankers' Acceptance; and
a fraction, the numerator of which is the
number of days remaining in the term of such Bankers'
Acceptance and the denominator of which is 365;
with such product being rounded up or down to the fifth
decimal place and .000005 being rounded up.
"BA Equivalent Advance" means the purchase by a Bank (other than a
Schedule I Bank) of an Acceptance Note pursuant to Section 2.15(h).
"BA Term" shall mean the term of a Bankers' Acceptance which shall
be at least 30 days and not more than 365 days, as available (or such
shorter or longer term as shall be agreed to by each Bank) excluding
days of grace; provided that any BA Term which would otherwise end on a
day which is not a Business Day shall be extended to the next
succeeding Business Day and provided further that any BA term which
would otherwise end after the Termination Date shall end on the
Termination Date.
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 10.9(c), and their
respective successors.
"Bankers' Acceptance" means, a xxxx of exchange denominated in
Canadian Dollars drawn by a Borrower and accepted by a Bank; provided
that, to the extent the context shall require, each Acceptance Note
shall be deemed to be a Bankers' Acceptance.
"Bankers' Acceptance Advance" means the creation and issuance of
Bankers' Acceptances in C$ at the request of a Borrower or by way of a
BA Equivalent Advance pursuant to the applicable Notice of Borrowing or
Notice of Conversion or Rollover or the provisions of Article 8.
"Bankers' Acceptance Obligations" means with reference to a
Borrower the aggregate Face Amount of all Bankers' Acceptances accepted
by the Banks at the request of such Borrower and all Acceptance Notes
issued by such Borrower to the Banks then outstanding, and with
reference to any Bank, the aggregate Face Amount of all Bankers'
Acceptances accepted by such Bank and all Acceptance Notes held by such
Bank then outstanding and, in the absence of any specific reference,
the aggregate Face Amount of all Bankers' Acceptances and Acceptance
Notes then outstanding.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to
by any member of the ERISA Group.
"Borrower" means IMC Canada or IMC Kalium, as the context may
require, and their respective successors, and "Borrowers" means both of
the foregoing. References to "the Borrower" in connection with any
Loan, Bankers' Acceptance or Letter of Credit are to the Borrower to
which such Loan is or is to be made or at whose request such Bankers'
Acceptance or Letter of Credit is or is to be issued.
"Borrowing" has the meaning set forth in Section 1.3.
"Business Day" means any day except a Saturday, Sunday or other
day on which commercial banks in Toronto, Ontario are required or
authorized to close and, where used in the context of (i) a LIBOR Loan,
which is also a day on which banks are not required or authorized to
close in London, England and New York, New York and dealings are
carried on in the London interbank market and (ii) a USBR Loan, which
is also a day on which banks are not required or authorized to close in
New York, New York or Chicago, Illinois.
"C$" means dollars in lawful currency of Canada.
"CDOR Prime Rate" means the CDOR Rate plus 100 basis points per
annum.
"CDOR Rate" means on any date, the per annum rate of interest
which is the rate based on an average rate applicable to Canadian
Dollar bankers' acceptances for a term of 30 days (in the case of the
definitions of "CDOR Prime Rate" and "Prime Rate") or for a term
equivalent to the term of the relevant Bankers' Acceptances (in the
case of the definition of "Applicable BA Discount Rate") appearing on
the "Reuters Screen CDOR Page" (as defined in the International Swap
Dealer Association, Inc. definitions, as modified or amended from time
to time) as of 10:00 a.m. (Toronto time) on such date, or if such date
is not a Business Day, then on the immediately preceding Business Day;
provided, however, if such rate does not appear on the Reuters Screen
CDOR Page as contemplated, then the CDOR Rate on any date shall be
calculated as the arithmetic mean of the rates for the term referred to
above applicable to Canadian Dollar bankers' acceptances quoted by the
Schedule I Reference Banks as of 10:00 a.m. (Toronto time), on such
date, or if such date is not a Business Day, then on the immediately
preceding Business Day.
"Co-Agent" means each Bank designated as a Co-Agent on the
signature pages hereof or hereafter designated as such by the Agent, in
its capacity as Co-Agent in respect of this Agreement;
"Commitment" means (i) with respect to each Bank listed on the
signature pages hereof, the amount set forth opposite the name of such
Bank on the signature pages hereof, and (ii) with respect to each
Assignee which becomes a Bank pursuant to Section 10.9(c), the amount
of the Commitment thereby assumed by it, in each case as such amount
may from time to time be reduced pursuant to Section 2.8 or 10.9(c) or
increased pursuant to Section 10.9(c).
"Consolidated Adjusted Debt" means at any date the sum of (i) the
Debt of the Guarantor and its Consolidated Subsidiaries plus (ii) the
excess (if any) of (A) the aggregate unrecovered principal investment
of transferees of accounts receivable from the Guarantor or a
Consolidated Subsidiary in transactions accounted for as sales under
generally accepted accounting principles over (B) US$100,000,000, in
each case determined on a consolidated basis as of such date.
"Consolidated EBITDA" means, for any period, the consolidated net
income of the Guarantor and its Consolidated Subsidiaries for such
period before (i) income taxes, (ii) interest expense, (iii)
depreciation and amortization, (iv) minority interest, (v)
extraordinary losses or gains, (vi) discontinued operations and (vii)
the cumulative effect of changes in accounting principles.
Consolidated EBITDA for each four-quarter period will be adjusted on a
pro-forma basis to reflect any Acquisition closed during such period as
if such Acquisition had been closed on the first day of such period.
"Consolidated Net Worth" means at any date the consolidated
shareholders' equity of the Guarantor and its Consolidated Subsidiaries
determined as of such date (other than any amount attributable to stock
which is required to be redeemed or is redeemable at the option of the
holder, if certain events or conditions occur or exist or otherwise).
"Consolidated Subsidiary" means, for any Person, at any date any
Subsidiary or other entity the accounts of which would be consolidated
with those of such Person in its consolidated financial statements if
such statements were prepared as of such date; unless otherwise
specified "Consolidated Subsidiary" means a Consolidated Subsidiary of
the Guarantor.
"Conversion Date" means the earliest to occur of (i) September 30,
1998, (ii) the date (if any) on which the Debt of the Guarantor and its
Consolidated Subsidiaries determined on a consolidated basis
("Consolidated Debt") exceeds 45% of the sum of Consolidated Debt and
Consolidated Net Worth and (iii) the date (if any) on which the
Guarantor is rated BBB- or lower by S&P or Baa3 or lower by Xxxxx'x.
"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, Bankers'
Acceptances or other similar instruments, (iii) all obligations of such
Person to pay the deferred purchase price of property or services,
except trade accounts payable and similar items arising in the ordinary
course of business, (iv) all obligations of such Person as lessee which
are capitalized in accordance with generally accepted accounting
principles, (v) all non-contingent obligations (and, for purposes of
subsections 5.1(i) and 5.2(f) and the definitions of Material Financial
Obligations and Guarantor's Material Financial Obligations, all
contingent obligations) of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (vi) all Debt secured by a Lien on any asset of such
Person, whether or not such Debt is otherwise an obligation of such
Person, provided that the amount of such Debt treated as Debt of such
Person solely pursuant to this clause (vi) shall not exceed the greater
of the book value or the fair market value of the collateral, and (vii)
all Debt of others Guaranteed by such Person. For purposes of clause
(v) above, a reimbursement obligation in respect of a letter of credit
or similar instrument is contingent unless and until there shall have
been a drawing under such letter of credit or instrument.
"Default" means any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Derivatives Obligations" of any Person means all obligations of
such Person in respect of any rate swap transaction, basis swap,
forward rate transaction, commodity swap, commodity option, equity or
equity index swap, equity or equity index option, bond option, interest
rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-
currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of the foregoing
transactions) or any combination of the foregoing transactions.
"Drafts" has the meaning ascribed thereto in subsection 2.15(a).
"Effective Date" means the date this Agreement becomes effective
in accordance with Section 3.1.
"Environmental Laws" means any and all federal, state, provincial,
local and foreign statutes, laws, regulations, by-laws, codes,
directives, standards, policies, guidelines, treaties, conventions,
judgments, awards, determinations, ordinances, rules, judgments,
orders, decrees, permits, concessions, grants, franchises, licenses,
agreements or other governmental restrictions relating to the
environment or human health and safety or to emissions, discharges or
releases of pollutants, contaminants, chemicals, wastes or industrial,
toxic or hazardous substances into the environment including, without
limitation, ambient air, surface water, ground water, or land, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, handling or remediation of
pollutants, contaminants, chemicals, wastes or industrial, toxic or
hazardous substances or wastes.
"Equivalent Amount" on any given date in one currency (the "first
currency") of any amount denominated in another currency (the "second
currency") means the amount of the first currency which could be
purchased with such amount of the second currency at the Bank of
Canada's noon spot rate (or any other rate to which the parties agree)
on such date (and if such date is not a Business Day on the preceding
Business Day) for the purchase of the first currency with the second
currency;
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Group" means the Guarantor, any Subsidiary of the Guarantor
and all members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) under common control which,
together with the Guarantor or any Subsidiary of the Guarantor, are
treated as a single employer under Section 414 of the Internal Revenue
Code.
"Euro-Dollar Loan" means a loan in US$ which bears interest at a
LIBOR Rate pursuant to the applicable Notice of Borrowing or Notice of
Conversion or Rollover.
"Event of Default" has the meaning set forth in Section 6.1.
"Existing Credit Agreements" means the credit facilities
identified in Schedule I hereto, as amended and in effect on the
Effective Date.
"Face Amount" means, in respect of a Bankers' Acceptance, the
amount payable to the holder thereof on the maturity thereof.
"Facility Fee Rate" means the facility fee rate prescribed in the
Pricing Schedule.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100th of 1%) equal to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day, provided
that (i) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and
(ii) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Agent on such day on such transactions as determined by
the Agent.
"FRP" means Freeport-McMoRan Resource Partners, L.P., a Delaware
limited partnership, and its successors.
"FTX" means Freeport-McMoRan Inc., a Delaware corporation.
"Governmental Authority" means any nation or government, any
state, province or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Group of Advances" means at any time a group of Advances
consisting of (i) all Loans to a single Borrower which are Prime Rate
Loans at such time (ii) all Loans to a single Borrower which are USBR
Loans at such time, (iii) all Bankers' Acceptances issued at the
request of a single Borrower having the same maturity date, provided
that if a Bankers' Acceptance accepted by any particular Bank is
converted to or made as a Prime Rate Loan pursuant to Article 8 such
Advance shall be included in the same Group or Groups of Advances from
time to time as it would have been if it had not been so converted or
made, or (iv) all Euro-Dollar Loans to a single Borrower having the
same Interest Period at such time, provided that, if a Euro-Dollar Loan
of any particular Bank is converted to or made as a US Base Rate Loan
pursuant to Article 8, such Loan shall be included in the same Group or
Groups of Loans from time to time as it would have been if it had not
been so converted or made.
"Guarantee" or "guarantee" by any Person means any obligation,
contingent or otherwise, of such Person directly or indirectly
guaranteeing any Debt of any other Person, provided that the term
Guarantee shall not include endorsements for collection or deposit in
the ordinary course of business. The term "Guarantee" or "guarantee"
used as a verb has a corresponding meaning.
"Guarantor" means IMC Global Inc., a Delaware corporation, and its
successors.
"Guarantor's Credit Agreements" means collectively the
US$650,000,000 five-year credit agreement and the US$350,000,000 364-
day credit agreement each among the Guarantor and the several banks
listed therein, Royal Bank of Canada, as documentation agent, The Chase
Manhattan Bank and NationsBank, N.A., as co-syndication agents, and
Xxxxxx Guaranty Trust Company of New York, as Agent, and each made as
of December 15, 1997.
"Guarantor's Material Financial Obligations" means a principal or
face amount of Debt and/or payment or collateralization obligations in
respect of Derivatives Obligations of the Guarantor and/or one or more
of its Subsidiaries, arising in one or more related or unrelated
transactions, exceeding in the aggregate US$100,000,000.
"IMC Canada" means International Minerals & Chemical (Canada)
Global Limited.
"IMC Kalium" means IMC Kalium Canada Ltd.
"IMC Potash" means IMC Global Potash Holdings Inc. (of which IMC
Canada is a direct, wholly-owned subsidiary).
"Indemnitee" has the meaning set forth in Section 10.4(b).
"Information Memorandum" means the confidential information
memorandum dated November 1997 furnished to the Banks in connection
with the transactions contemplated hereby.
"Interest Period" means:
with respect to each Euro-Dollar Loan, the period
commencing on the date of borrowing specified in the
applicable Notice of Borrowing or on the date specified in an
applicable Notice of Conversion or Rollover and ending one,
two, three or six, or, if deposits of a corresponding
maturity are available to each Bank in the London interbank
market, nine or twelve, months thereafter, as the Borrower
may elect in such notice; provided that:
any Interest Period which would otherwise end
on a day which is not a Business Day shall be extended
to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Business
Day; and
any Interest 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 Interest Period) shall
end on the last Business Day of a calendar month;
with respect to a Swingline Loan, the period commencing
on the date of borrowing specified in the applicable Notice
of Borrowing and ending 10 Business Days thereafter; provided
that any Interest Period which would otherwise end on a day
which is not a Business Day shall be extended to the next
succeeding Business Day; and
provided further that any Interest Period which would otherwise end
after the Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the United States Internal Revenue
Code of 1986.
"Issuing Bank" means Royal Bank of Canada and any other Bank
agreed upon by both Borrowers which agrees to issue letters of credit
hereunder, in each case as issuer of a Letter of Credit hereunder.
"Letter of Credit" means a letter of credit or a letter of
guarantee to be issued or issued hereunder by an Issuing Bank in
accordance with Section 2.16.
"Letter of Credit Liabilities" means, for any Bank and at any
time, such Bank's ratable participation in the sum of (x) the amounts
then owing by a Borrower in respect of amounts drawn under Letters of
Credit and (y) the aggregate amount then available for drawing under
all Letters of Credit issued for the account of a Borrower.
"Leverage Ratio" means at any date the ratio of Consolidated
Adjusted Debt calculated as of such date to Consolidated EBITDA
calculated for the period of four consecutive fiscal quarters most
recently ended on or prior to such date.
"LIBOR Margin" means a rate per annum determined in accordance
with the Pricing Schedule.
"LIBOR Rate" means the rate of interest per annum appearing on
page 3750 of the Telerate screen as of 11:00 a.m. London time two
Business Days prior to drawdown for the interest period selected,
provided that if Telerate page 3750 is unavailable, then LIBOR shall be
determined by the Agent with reference to Reuters page LIBO (at or
about 11:00 a.m. London, England time) provided that if Reuters page
LIBO is unavailable, then LIBOR shall be determined by the Agent as the
rate at which deposits in an amount and for a term equal to the
proposed LIBOR Loan are offered by it to prime banks in the London
interbank market at or about 11:00 a.m. London, England time.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge or security interest, or any other type of preferential
arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this
Agreement, the Borrowers, the Guarantor or any Subsidiary of any of
them shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under
any conditional sale agreement, capital lease or other title retention
agreement relating to such asset.
"Loan" means a Syndicated Loan or a Swingline Loan and "Loans"
means Syndicated Loans or Swingline Loans.
"Material Adverse Effect" means (i) a material adverse effect on
the business, financial position, or results of operations of any
Borrower or the Guarantor and their respective Consolidated
Subsidiaries as the context requires, considered as a whole, or (ii) an
adverse effect on the rights and obligations of the Banks and the Agent
hereunder which a Bank could reasonably deem material.
"Material Financial Obligations" means a principal or face amount
of Debt and/or payment or collateralization obligations in respect of
Derivatives Obligations of the Borrowers and/or one or more of their
Subsidiaries, arising in one or more related or unrelated transactions,
exceeding in the aggregate US$10,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of US$100,000,000.
"Material Subsidiary" means, at any date, (i) any Subsidiary
having (x) at least 5% of the total consolidated assets of the
Guarantor and its Consolidated Subsidiaries, (determined as of the last
day of the fiscal quarter of such Person most recently ended on or
prior to such date) or (y) at least 5% of Consolidated EBITDA for the
four consecutive fiscal quarters most recently ended on or prior to
such date or (ii) collectively, any one or more Subsidiaries having (x)
at least 10% of the total consolidated assets of the Guarantor and its
Consolidated Subsidiaries, (determined as of the last day of the fiscal
quarter of such Persons most recently ended on or prior to such date)
or (y) at least 10% of Consolidated EBITDA for the four consecutive
fiscal quarters most recently ended on or prior to such date.
"Merger" means the merger of FTX with and into the Guarantor
pursuant to the Merger Agreement.
"Merger Agreement" means the Agreement and Plan of Merger between
FTX and the Guarantor dated as of August 26, 1997, in the form annexed
to the Guarantor's Proxy Statement/Prospectus dated November 17, 1997.
"Moody's" means Xxxxx'x Investor Service, Inc.
"Multiemployer Plan" means at any time an employee pension benefit
plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group either (i) is then making or accruing an
obligation to make contributions or (ii) has within the preceding five
plan years made contributions, including for these purposes any Person
which was at the time such contribution was made a member of the ERISA
Group.
"Notice of Borrowing" means a Notice of Borrowing (as defined in
Section 2.2), in either case in substantially the form of Exhibit A.
"Notice of Conversion or Rollover" has the meaning set forth in
Section 2.9(a).
"Notice of Issuance" has the meaning set forth in Section 2.16(b).
"Parent" means, with respect to any Bank, any Person controlling
such Bank.
"Participant" has the meaning set forth in Section 10.9(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a limited liability
company, a partnership, an association, a trust or any other entity or
organization, including a Governmental Authority.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the
Internal Revenue Code and either (i) is maintained, or contributed to,
by any member of the ERISA Group for employees of any member of the
ERISA Group or (ii) has at any time within the preceding five years
been maintained, or contributed to, by any Person which was at such
time a member of the ERISA Group for employees of any Person which was
at such time a member of the ERISA Group.
"Pricing Schedule" means the schedule annexed hereto denominated
as such.
"Prime Rate" means the rate of interest per annum in effect from
time to time that is equal to the greater of (i) Royal Bank of Canada's
prime rate, being the annual rate of interest publicly announced by it
from time to time as its reference rate then in effect for determining
interest rates for commercial loans in C$ made by it in Canada; and
(ii) CDOR Prime Rate.
"Prime Rate Loan" means a loan in C$ which bears interest at the
Prime Rate pursuant to the applicable Notice of Borrowing or Notice of
Conversion or Rollover or the provisions of Article 8.
"Quarterly Payment Date" means the last Business Day of each
March, June, September and December.
"Refunding Bankers' Acceptance" has the meaning ascribed thereto
in clause 2.9(a)(iv).
"Required Banks" means at any time Banks having more than 50% of
the aggregate amount of the Commitments or, if the Commitments shall
have been terminated, holding more than 50% of the sum of the aggregate
unpaid principal amount of the Loans, the aggregate Bankers' Acceptance
Obligations, and the aggregate Letter of Credit Liabilities.
"Revolving Credit Period" means the period from and including the
Effective Date to but not including the Termination Date.
"S&P" means Standard & Poor's Rating Services.
"Schedule I Bank" means any Bank named on Schedule I to the Bank
Act (Canada).
"Schedule I Reference Banks" means the collective reference to
Royal Bank of Canada and Bank of Montreal or if one or both of such
banks are not at the relevant time a Bank hereunder, such other
Schedule I Banks (not to exceed two) in number or as may be selected by
the Agent in consultation with the Borrower.
"Schedule II Bank" means any Bank named on Schedule II to the Bank
Act (Canada).
"Schedule II Reference Banks" means the collective reference to
X.X. Xxxxxx Canada and The Chase Manhattan Bank of Canada ("Chase") or
if, in the case of Chase it does not become a Bank hereunder by January
2, 1998 (or such later date as may be agreed by Royal Bank of Canada)
and, in any other case, if one or both of such banks are not at the
relevant time a Bank hereunder, such other Schedule II Banks (not to
exceed two) in number or as may be selected by the Agent in
consultation with the Borrower.
"Series E Preferred Stock" means the shares of preferred stock of
The Vigoro Corporation, a Delaware corporation and wholly-owned
Subsidiary of the Guarantor, par value $100 per share, designated
Series E.
"Stamping Fee" means the fee payable in Canadian Dollars to each
Bank in respect of Bankers' Acceptances accepted by a Bank and Bankers'
Acceptance Notes purchased by a Bank computed in accordance with
subsection 2.7(c).
"Subsidiary" means, as to any Person, any corporation or other
entity of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other
persons performing similar functions are at the time directly or
indirectly owned by such Person.
"Substantial Assets" means assets sold or otherwise disposed of in
a single transaction or a series of related transactions representing
25% or more of the consolidated assets of any Person and its
Consolidated Subsidiaries, taken as a whole.
"Substantially-Owned Consolidated Subsidiary" means any
Consolidated Subsidiary at least 80% of the Voting Stock of which is at
the time directly or indirectly owned by the Guarantor; provided that
Agrico shall be deemed a Substantially-Owned Consolidated Subsidiary
for so long as it is a Consolidated Subsidiary.
"Swingline Bank" means Royal Bank of Canada.
"Swingline Loan" means a Prime Rate Loan or a USBR Loan made by
the Swingline Bank pursuant to Section 2.1(b).
"Swingline Rate" means, in the case of a Swingline Loan in US$,
the US Base Rate and, in the case of a Swingline Loan in C$, the Prime
Rate.
"Syndicated Advance" means an Advance made (or deemed to be made),
by a Bank to a Borrower pursuant to Section 2.1(a) provided that, if
any Advance or Advances (or portions thereof) are combined or
subdivided pursuant to a Notice of Conversion or Rollover, the term
"Syndicated Advance" shall refer to the combined principal amount or
Face Amount, as applicable, resulting from such combination or to each
of the separate principal amounts or Face Amounts, as applicable,
resulting from such subdivision, as the case may be.
"Syndicated Loan" means a Prime Rate Loan, Euro-Dollar Loan or a
USBR Loan made pursuant to section 2.1(a).
"Termination Date" means December 12, 2002, or, if such day is not
a Business Day, the next preceding Business Day.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit
liabilities under such Plan, determined on a plan termination basis
using the assumptions prescribed by the PBGC for purposes of Section
4044 of ERISA (or other applicable standard), exceeds (ii) the fair
market value of all Plan assets allocable to such liabilities under
Title IV of ERISA (excluding any accrued but unpaid contributions), all
determined as of the then most recent valuation date for such Plan, but
only to the extent that such excess represents a potential liability of
a member of the ERISA Group to the PBGC or any other Person under Title
IV of ERISA.
"Unrefunded Swingline Loan" has the meaning set forth in
subsection 2.17(b).
"US Base Rate" means the rate of interest per annum in effect from
time to time that is equal to the greater of (i) Royal Bank of Canada's
U.S. Base Rate, being the annual rate of interest publicly announced by
it from time to time as its reference rate then in effect for
determining interest rates for commercial loans in US$ made in Canada;
and (ii) the Federal Funds Rate in effect from time to time plus a
margin of 50 basis points per annum.
"US Borrower" means any Person who is a "Borrower" under either of
the Guarantor's Credit Agreements.
"US$" means dollars in the lawful currency of the United States of
America.
"USBR Loan" means a loan in US$ which bears interest at the US
Base Rate pursuant to the applicable Notice of Borrowing or Notice of
Conversion or Rollover or the provisions of Article 8.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the
happening of such a contingency.
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 United States generally accepted accounting
principles as in effect from time to time, applied on a basis
consistent in all material respects (except for changes concurred in by
the Borrowers' or the Guarantor's independent public accountants) with
the most recent audited consolidated financial statements of the
Guarantor and its Consolidated Subsidiaries delivered to the Banks
hereunder; provided that, if the Borrower or the Guarantor notifies the
Agent that the Borrower or the Guarantor wishes to amend any covenant
in Article 5 to eliminate the effect of any change in generally
accepted accounting principles on the operation of such covenant (or if
the Agent notifies the Borrowers or the Guarantor that the Required
Banks wish to amend Article 5 for such purpose), then the Borrowers' or
the Guarantor's compliance with such covenant shall be determined on
the basis of United States generally accepted accounting principles in
effect immediately before the relevant change in generally accepted
accounting principles became effective, until either such notice is
withdrawn or such covenant is amended in a manner satisfactory to the
Borrowers or the Guarantor and the Required Banks, and the parties
hereto agree to enter into negotiations in good faith in order to amend
such provisions in a credit-neutral manner so as to reflect equitably
such changes with the desired result that the criteria for evaluating
the financial condition and performance of the Borrowers or the
Guarantor and its Consolidated Subsidiaries shall be the same after
such changes as if such changes had not been made.
1.3 Types of Borrowings. The term "Borrowing" denotes the
aggregation of Advances of one or more Banks to be made to a single
Borrower pursuant to Article 2 on a single date and for a single
Interest Period. Borrowings are classified for purposes of this
Agreement either by reference to the pricing of Advances comprising
such Borrowing (e.g., a "Prime Rate Borrowing" is a Borrowing under
section 2.1 in C$, a "USBR Borrowing" is a Borrowing under section 2.1
in US$, a "Euro-Dollar Borrowing" is a Borrowing comprised of Euro-
Dollar Loans and a "Bankers' Acceptance Borrowing" is the issue and
purchase of Bankers' Acceptances under Sections 2.1 and 2.15) or by
reference to the provisions of Article 2 under which participation
therein is determined (i.e., a "Syndicated Borrowing" is a Borrowing
under Section 2.1(a)).
1.4 Currency. For the purpose of determining the aggregate
amount in US$ outstanding from time to time of one or more Advances
made hereunder, the principal amounts of any Loans made in C$, the Face
Amount of any Bankers' Acceptances and the Letter of Credit Liabilities
of any Letter of Credit denominated in C$ shall be converted to the
Equivalent Amount in US$. Where any representation, warranty, covenant
or Event of Default hereunder refers to an amount expressed in US$,
then for the purpose of determining the compliance with or breach of
such representation, warranty, covenant or Event of Default, any
applicable amounts denominated in any other currency shall, unless the
context otherwise requires, be converted to the Equivalent Amount in
US$ thereof.
1.5 Amendments to Agreements and Laws. Any reference herein to
an agreement, contract or law shall, unless otherwise specifically
provided, be deemed to be a reference to such agreement, contract or
law as it may be amended, restated or replaced from time to time.
1.6 Several. The indebtedness and liability of each Borrower
hereunder shall be several and not joint or joint and several.
1.7 Interest Rates and Fees. For the purpose of determining the
LIBOR Margin, the Stamping Fee and the Facility Fee Rate, "Level II
Status" (as defined in the Pricing Schedule) shall be deemed to exist
and to be applicable from the date hereof until the Conversion Date.
ARTICLE
THE CREDITS
2.1 Commitments.
Syndicated Advances. During the Revolving Credit Period, the
Banks severally agree, on the terms and conditions set forth in this
Agreement, to make Advances to either of the Borrowers pursuant to this
subsection from time to time in amounts such that the aggregate
principal amount of Loans by such Bank, together with such Bank's
Bankers' Acceptance Obligations, Letter of Credit Liabilities and
participating interest in any Unrefunded Swingline Loans, at any one
time outstanding to all Borrowers shall not exceed the amount of its
Commitment. Each Borrowing under this subsection shall be made from
the Banks ratably in proportion to their respective Commitments.
Within the foregoing limits, either of the Borrowers may borrow under
this subsection (a), repay or, to the extent permitted by Section 2.11,
prepay Advances and reborrow at any time during the Revolving Credit
Period under this subsection (a), provided that:
each Prime Rate Loan made or deemed to be made
by a Bank pursuant to this subsection 2.1(a) shall be in
a minimum aggregate principal amount of C$5,000,000;
each USBR Loan made or deemed to be made by a
Bank pursuant to this subsection 2.1(a) shall be in a
minimum aggregate principal amount of US$5,000,000;
each Euro-Dollar Loan made by a Bank pursuant
to this subsection 2.1(a) shall be in a minimum
aggregate principal amount of US$5,000,000 or any larger
multiple of US$500,000; and
each Bankers' Acceptance Advance made by a
Bank pursuant to this subsection 2.1(a) shall be in a
minimum aggregate Face Amount of C$5,000,000 or a whole
multiple of C$500,000 in excess thereof and the Face
Amount of each Bankers' Acceptance shall be C$100,000 or
any whole multiple thereof,
provided that any such Borrowing to refund a Swingline Loan or to
satisfy a Bankers' Acceptance Obligation or to fund the reimbursement
of a Letter of Credit may be in the exact amount required for such
purpose, subject always to subsection 3.2(b).
Swingline Loans. From time to time prior to the Termination
Date, the Swingline Bank agrees, on the terms and conditions set forth
in this Agreement, to make loans to either of the Borrowers pursuant to
this subsection from time to time in amounts provided that (i) the
aggregate principal amount of its Loans together with such Swingline
Bank's Bankers' Acceptance Obligations and Letter of Credit Liabilities
at any one time outstanding to both Borrowers shall not exceed the
amount of its Commitment and (ii) the aggregate principal amount of
Swingline Loans at any time outstanding shall not exceed US$10,000,000.
Within the foregoing limits, either of the Borrowers may borrow under
this subsection, repay or, to the extent permitted by Section 2.11,
prepay Swingline Loans and reborrow at any time during the Revolving
Credit Period under this subsection (b); provided that the proceeds of
a Swingline Borrowing may not be used, in whole or in part, to refund
any prior Swingline Borrowing. Each Borrowing under this subsection
shall be by way of Prime Rate Loan or USBR Loan and shall be in an
aggregate principal amount of US$250,000 or any larger multiple of
US$100,000 in the case of a USBR Loan and, the Equivalent Amount in C$,
in the case of a Prime Rate Loan.
2.2 Notice of Syndicated or Swingline Borrowings. The Borrower
shall give the Agent notice substantially in the form of Exhibit A (a
"Notice of Borrowing") (x) not later than 11:00 a.m. (Toronto time) on
the date of each Prime Rate Borrowing or US Base Rate Borrowing, (y)
not later than 12:00 noon (Toronto time) on the Business Day preceding
the date of each Bankers' Acceptance Advance and (z) not later than
12:00 noon (Toronto time) on the third Business Day preceding the date
each Euro-Dollar Borrowing, specifying:
the name of the Borrower;
the date of such Borrowing, which shall be a Business Day;
the aggregate amount of such Borrowing and the currency in
which such Borrowing is to be made;
whether the Borrowing is to be a Syndicated Borrowing or a
Swingline Borrowing;
in the case of a Syndicated Borrowing in US$, whether the
Borrowing is to be by way of USBR Loan or Euro-Dollar Loan;
in the case of a Euro-Dollar Borrowing the duration of the
initial Interest Period applicable thereto, subject to the provisions
of the definition of Interest Period;
in the case of a Syndicated Borrowing in C$, whether the
Borrowing is to be by way of Prime Rate Loan or Bankers' Acceptance
Advance; and
in the case of a Bankers' Acceptance Borrowing, the BA Term.
2.3 Notice to Banks; Funding of Advances.
Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's
share (if any) of such Borrowing or, in the case of Bankers' Acceptance
Borrowings, the aggregate Face Amount of each Bankers' Acceptance (if
any) to be accepted by it, and such Notice of Borrowing shall not
thereafter be revocable by the Borrower except as otherwise provided in
Section 8.1 and 8.2.
Not later than 2:00 p.m. (Toronto time) on the date of each
Borrowing, each Bank participating therein shall (except as provided in
subsection (c) of this Section) make available its share of such
Borrowing (or, in the case of a Bankers' Acceptance Borrowing, the BA
Discount Proceeds net of the Stamping Fee payable by the Borrower), to
the Agent for the account of the Borrower at its address specified in
or pursuant to Section 10.1. Unless the Agent determines that any
applicable condition specified in Article 3 has not been satisfied, the
Agent will make the funds so received from the Banks available to the
Borrower at the Agent's aforesaid address not later than 4:00 p.m.
(Toronto time) on the date of such Borrowing.
Unless the Agent shall have received notice from a Bank one
Business Day prior to the date of any Borrowing that such Bank will not
make available to the Agent such Bank's share of such Borrowing or the
BA Discount Proceeds (net of the Stamping Fee), the Agent may assume
that such Bank has made such share available to the Agent on the date
of such Borrowing in accordance with subsection (b) of this Section 2.3
and the Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent
that such Bank shall not have so made such share available to the
Agent, such Bank and the Borrower severally agree to repay to the Agent
forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to
the Borrower until the date such amount is repaid to the Agent, at the
interest rate applicable thereto pursuant to Section 2.6: (i) in the
case of the Borrower, (x) with respect to US$ Borrowings, a rate per
annum equal to the higher of the Federal Funds Rate and the interest
rate applicable thereto pursuant to Section 2.6, (y) with respect to C$
Borrowings a rate per annum equal to the higher of the CDOR Prime Rate
and the interest rate applicable to Prime Rate Loans pursuant to
Section 2.6, and (without prejudice to the Borrower's rights of
recourse against such Bank); (ii) in the case of such Bank, (x) with
respect to US$ Borrowings, the Federal Funds Rate and (y) with respect
to C$ Borrowings the CDOR Prime Rate. If such Bank shall repay to the
Agent such corresponding amount, such amount so repaid shall constitute
such Bank's Loan or BA Discount Proceeds included in such Borrowing for
purposes of this Agreement.
The failure of any Bank to make the Advance to be made by it
as part of any Borrowing shall not relieve any other Bank of its
obligation, if any, hereunder to make an Advance on the date of such
Borrowing, but no Bank shall be responsible for the failure of any
other Bank to make an Advance to be made by such other Bank.
2.4 Registry.
The Agent shall open and maintain in accordance with its
usual practice books of account evidencing all Borrowings and Letter of
Credit Liabilities and all other amounts owing by each Borrower to the
Agent and the Banks hereunder. The Agent shall enter in the foregoing
accounts details of every Loan made and Bankers' Acceptance and Letter
of Credit issued and of all amounts from time to time owing or paid by
each Borrower to the Agent on its own behalf or on behalf of the Banks
hereunder, the amounts of principal, interest and fees payable from
time to time hereunder and the unused portion of each Bank's Commitment
available to be drawn down by a Borrower. The information entered in
the foregoing accounts shall constitute, in the absence of manifest
error, prima facie evidence of the obligations of each of the Borrowers
to the Agent and the Banks hereunder, the date of each Loan by each
Borrower, the date of acceptance and purchase of Bankers' Acceptances,
the date an Issuing Bank issued or was called to honour a Letter of
Credit and the amounts each Borrower has paid from time to time on
account of the Borrowings or Letter of Credit Liabilities. Failure to
make any such recordation, or any error in such recordation, shall not
affect the Borrowers' obligations hereunder.
Each Bank shall open and maintain in accordance with its
usual practice books of account evidencing all Borrowings from such
Bank, Letter of Credit Liabilities of such Bank and all other amounts
owing by each Borrower to such Bank hereunder. The Bank shall enter in
the foregoing accounts details of every Loan made and Bankers'
Acceptance accepted and purchased by it and Letter of Credit issued by
it and all amounts from time to time owing or paid to the Bank on
account of amounts owed hereunder, the amounts of principal, interest
and fees payable from time to time hereunder and the unused portion of
its Commitment available to be drawn down by a Borrower.
2.5 Maturity of Loans.
Each Syndicated Loan shall mature, and the principal amount
thereof shall be due and payable together with accrued and unpaid
interest thereon, on the Termination Date.
Each Swingline Loan included in any Swingline Borrowing shall
mature, and the principal amount thereof shall be due and payable
(together with accrued and unpaid interest thereon), on the last day of
the Interest Period applicable to such Borrowing.
2.6 Interest Rates.
Each Prime Rate Loan shall bear interest on the outstanding
principal amount thereof for each day from the date such Loan is made
until it becomes due, at a rate per annum equal to the Prime Rate for
such day. Such interest shall be calculated and paid quarterly in
arrears on each Quarterly Payment Date, at maturity and, with respect
to the principal amount of any Prime Rate Loan converted into a
Bankers' Acceptance, on the date such Prime Rate Loan is so converted.
Any overdue principal of or overdue interest on any Prime Rate Loan
shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the sum of 2% plus the Prime Rate for such day.
Each USBR Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made
until it becomes due, at a rate per annum equal to the US Base Rate for
such day. Such interest shall be payable quarterly in arrears on each
Quarterly Payment Date, at maturity and, with respect to the principal
amount of any USBR Loan converted to a Euro-Dollar Loan, on the date
such USBR Loan is so converted. Any overdue principal of or overdue
interest on any USBR Loan shall bear interest, payable on demand, for
each day until paid at a rate per annum equal to the sum of 2% plus the
US Base Rate for such day.
Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during each Interest Period
applicable thereto, at a rate per annum equal to the sum of the LIBOR
Margin for such day plus the LIBOR Rate applicable to such Interest
Period. Such interest shall be payable for each Interest Period on the
last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof.
Any overdue principal of or overdue interest on any
Euro-Dollar Loan shall bear interest, payable on demand, for each day
from and including the date payment thereof was due to but excluding
the date of actual payment, at a rate per annum equal to the sum of 2%
plus the higher of (i) the sum of the LIBOR Margin for such day plus
the LIBOR Rate applicable to such Loan at the date such payment was due
and (ii) the US Base Rate for such day.
Each Swingline Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period
applicable thereto, at a rate per annum equal to the Swingline Rate for
such day or such other rate as may be from time to time determined by
mutual agreement in writing between the Swingline Bank and the
Borrower. Interest on each Swingline Loan shall be payable at the
maturity of such Swingline Loan. Any overdue principal of or interest
on any Swingline Loan shall bear interest, payable on demand, for each
day until paid at a rate per annum equal to the sum of 2% plus the
Swingline Rate for such day; provided that if and to the extent the
failure to pay such principal or interest when due was attributable to
default by a Bank in making a Loan which such Bank was obligated to
make hereunder, such interest shall accrue at a rate per annum equal to
the Swingline Rate from and including the date such payment was due to
but not including the first Business Day thereafter and shall accrue at
a rate per annum equal to the sum of 2% plus the Swingline Rate from
and including such first succeeding Business Day until paid.
The Agent shall determine each interest rate, discount rate
and fees applicable to the Borrowings and Letters of Credit hereunder
in accordance with the terms of this Agreement. The Agent shall give
prompt notice to the Borrower and the participating Banks of each rate
(other than the Prime Rate or US Base Rate) or amount so determined and
its determination thereof shall be conclusive in the absence of
manifest error.
2.7 Fees.
Facility Fees. The Borrowers will pay to the Agent for the
account of each Bank ratably a facility fee at the Facility Fee Rate
(calculated daily in accordance with the Pricing Schedule). Such
facility fee shall accrue (i) from and including the earlier of the
date hereof and the Effective Date to but excluding the date of
termination of the Commitments in their entirety, accruing daily, on
the aggregate amount of the Commitments (whether used or unused) and
(ii) from and including such date of termination to but excluding the
date the Loans, the Bankers' Acceptance Obligations and Letter of
Credit Liabilities shall be repaid in their entirety, on the daily
average aggregate outstanding principal amount of the Loans, the
Bankers' Acceptance Obligations and Letter of Credit Liabilities.
Accrued fees under this subsection shall be payable in US$ quarterly in
arrears on each Quarterly Payment Date and upon the date of termination
of the Commitments in their entirety (and, if later, the date the
Loans, the Bankers' Acceptance Obligations and Letter of Credit
Liabilities shall be repaid in their entirety).
Letter of Credit Fees. Each Borrower shall pay to the Agent
(i) for the account of the Banks a letter of credit or letter of
guarantee fee accruing daily on the aggregate amount then available for
drawing under all outstanding Letters of Credit issued by the Issuing
Bank at the Borrower's request at a rate per annum equal to the LIBOR
Margin payable quarterly in arrears on the Quarterly Payment Date and
the date of termination of the Commitments in their entirety (and, if
later, the date the Loans, the Bankers' Acceptance Obligations and
Letter of Credit Liabilities shall be repaid in their entirety) (ii)
for the account of the Issuing Bank a letter of credit fronting fee
accruing daily on the aggregate amount then available for drawing under
all Letters of Credit issued by the Issuing Bank issued at the
Borrower's request at a rate per annum of 0.125% payable quarterly in
arrears on the Quarterly Payment Date and the date of termination of
the Commitments in their entirety (and, if any Letter of Credit shall
be outstanding thereafter, on the date the Loans, the Bankers'
Acceptance Obligations and Letter of Credit Liabilities shall be repaid
in their entirety) and such other customary Letter of Credit fees as
mutually agreed from time to time by the Borrowers and such Issuing
Bank.
Stamping Fee. The Stamping Fee (determined in accordance
with the Pricing Schedule) shall be payable by the Borrower to each
Bank in advance (in the manner specified in Section 2.15(d) upon the
issuance of a Bankers' Acceptance and the acceptance thereof by such
Bank, such Stamping Fee to be calculated on the Face Amount of such
Bankers' Acceptance and to be computed on the basis of the number of
days in the term of such Bankers' Acceptance. The Stamping Fee shall
be adjusted to take into account changes to the "Status" (as defined in
the Pricing Schedule) of the Borrower during the BA Term. The Agent
shall notify the Borrower and the Banks of any amounts payable on
account of such adjustments not later than 12:00 noon (Toronto time) on
the last day of the BA Term (or if such BA Term is greater than three
months, on each three-month anniversary of the commencement of such BA
Term and the last day thereof) and such adjusting payments shall be
made within one Business Day after such notification.
Event of Default. Notwithstanding the foregoing provisions
of this Section 2.7, upon the occurrence of an Event of Default, all
accrued and unpaid fees hereunder, whether or not otherwise then
payable, shall be paid forthwith by the applicable Borrowers.
2.8 Optional Termination or Reduction of Commitments. The
Borrowers may, on one Business Day's joint written notice to the Agent,
(i) terminate the Commitments at any time, if no Loans, Bankers'
Acceptance Obligations or Letter of Credit Liabilities are outstanding
at such time (after giving effect to any contemporaneous prepayment of
the Loans, the Bankers' Acceptance Obligations or the Letter of Credit
Liabilities in accordance with Section 2.11) or (ii) ratably reduce the
Commitments from time to time by an aggregate amount of US$10,000,000
or any larger multiple of US$1,000,000; provided that prepayments in
respect of such reductions shall be without effect in respect of Loans,
Bankers' Acceptance Obligations and Letter of Credit Liabilities
outstanding at the time of such reduction unless such Loans, Bankers'
Acceptance Obligations and Letter of Credit Liabilities and all amounts
payable in respect thereof are prepaid at which time such reductions
shall become effective. Each such prepayment shall be made to the
Agent in accordance and subject to the limitations in Section 2.11 and
shall be applied to prepay the relevant Loans, the Bankers' Acceptance
Obligations and Letter of Credit Liabilities of the Banks ratably.
Reductions hereunder shall constitute a permanent reduction of the
Commitment of each Bank.
2.9 Conversion or Rollover of Syndicated Advances.
The Borrower may convert the Advances included in each
Syndicated Borrowing (subject in each case to the provisions of Article
8 and the last sentence of this subsection (a)), as follows:
if such Loans are USBR Loans, provided no
Default or Event of Default has occurred and is
continuing, the Borrower may elect to convert such Loans
to Euro-Dollar Loans as of any Business Day;
if such Loans are Euro-Dollar Loans, the
Borrower may elect to convert such Loans to USBR Loans
or, provided no Default or Event of Default has occurred
and is continuing, elect to continue such Loans as
Euro-Dollar Loans for an additional Interest Period, on
the last day of the then current Interest Period
applicable to such Euro-Dollar Loans;
if such Loans are Prime Rate Loans, provided no
Default or Event of Default has occurred and is continuing, the
Borrower may elect to convert such Loans to
Bankers' Acceptance Advances as of any Business Day; and
if such Advances are by way of Bankers'
Acceptances, the Borrower may elect to convert the Face
Amount of such Bankers' Acceptances to Prime Rate Loans
or, provided no Default or Event of Default has occurred
and is continuing, elect to issue a Bankers' Acceptance
on the last day of the then current BA Term applicable
to such Bankers' Acceptances (a "Refunding Bankers'
Acceptance") to provide for the payment of such maturing
Bankers' Acceptance (it being understood that fundings
by the Banks in respect of each maturing Bankers'
Acceptance and the related Refunding Bankers' Acceptance
shall be made on a net basis reflecting the difference
between the Face Amount of such maturing Bankers'
Acceptance and the BA Discount Proceeds (net of the
applicable Stamping Fee) of such Refunding Bankers'
Acceptance).
Each such election shall be made by delivering a notice in
substantially the form of Exhibit B (a "Notice of Conversion or
Rollover") to the Agent not later than 10:00 a.m. (Toronto time) on the
third Business Day, in the case of conversions pursuant to clauses (i)
and (ii) above, and on the first Business Day in the case of all other
conversions before the conversion or continuation selected in such
notice is to be effective. A Notice of Conversion or Rollover may, if
it so specifies, apply to only a portion of the aggregate principal
amount of the relevant Group of Advances in respect of the conversion
of a Group of Advances, provided that (i) such portion is allocated
ratably among the Advances comprising such Group and (ii) the portion
to which such notice applies, and the remaining portion to which it
does not apply, are each US$5,000,000, in the case of Advances in US$,
and C$5,000,000, in the case of Advances in C$.
Each Notice of Conversion or Rollover shall specify:
the Group of Advances (or portion thereof) to
which such notice applies;
the date on which the conversion or
continuation selected in such notice is to be effective,
which shall comply with the applicable clause of
subsection 2.9(a) above;
if Advances are to be converted, the new type
of Advances and, if the Advances being converted are to
be (i) Euro-Dollar Loans, the duration of the next
succeeding Interest Period applicable thereto or (ii)
Bankers' Acceptance Advances, the BA Term thereof;
if such Advances are to be continued as
Euro-Dollar Loans for an additional Interest Period, the
duration of such additional Interest Period; and
if a Refunding Bankers' Acceptance is to be
issued, the BA Term thereof.
Each Interest Period or BA Term specified in a Notice of Conversion or
Rollover shall comply with the provisions of the definition of the term
"Interest Period" or "BA Term" respectively.
Promptly after receiving a Notice of Conversion or Rollover
from the Borrower pursuant to subsection 2.9(a) above, the Agent shall
notify each Bank of the contents thereof and such notice shall not
thereafter be revocable by the Borrower. If no Notice of Conversion or
Rollover is timely received prior to the end of an Interest Period or
BA Term for any Group of Advances, the Borrower shall be deemed to have
elected that such Group of Advances be converted to Prime Rate Loans,
in the case of Advances in C$, and US Base Rate Loans, in the case of
Advances in US$, as of the last day of such Interest Period or BA Term,
as applicable.
An election by the Borrower to change or continue the rate of
interest applicable to any Group of Advances or issue a Refunding
Bankers' Acceptance pursuant to this Section shall not constitute a new
Borrowing.
An Advance denominated in one currency may not be converted
into an Advance denominated in another currency; however, an Advance
denominated in one currency may be repaid concurrently with the
drawdown of an Advance denominated in another currency.
If a Default of Event of Default has occurred and is
continuing on the last day of an Interest Period in the case of a Euro-
Dollar Loan, or on the last day of a BA Term, in the case of Bankers'
Acceptances, (x) in respect of a Euro-Dollar Loan, the Borrower shall
be deemed to have converted the Euro-Dollar Loan to a USBR Loan as of
the last day of the Interest Period, and (y) in respect of Bankers'
Acceptances, the Borrower shall be deemed to have elected to convert
the Bankers' Acceptance into a Prime Rate Loan in an amount equal to
the Face Amount thereof on the last day of the BA Term.
2.10 Scheduled Termination of Commitments. The Commitments shall
terminate on the Termination Date, and any Advances then outstanding
(together with accrued and unpaid interest thereon) and Letter of
Credit Liabilities shall be due and payable on such date.
2.11 Optional Prepayments.
Subject, in the case of any Euro-Dollar Borrowing, to Section
2.13, the Borrower may without penalty or bonus payment (i) not later
than 11:00 a.m. (Toronto time) on any Business Day prepay on such
Business Day any Group of Prime Rate Loans or USBR Loans, (ii) upon one
Business Days' notice, not later than 12:00 noon on any Business Day,
prepay on such Business Day any Group of Bankers' Acceptance
Obligations and (iii) upon at least three Business Days' notice to the
Agent, not later than 12:00 noon (Toronto time), on any Business Day
prepay on such Business Day any Group of Euro-Dollar Loans, in each
case in whole at any time, or from time to time in part in amounts
aggregating US$5,000,000 or any larger multiple of US$500,000, by
paying the principal amount to be prepaid together with accrued
interest thereon to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Advances of the Banks
included in such Group or Borrowing.
Amounts prepaid in respect of any Bankers' Acceptance
Obligations shall be kept by the Agent in an interest bearing cash
collateral account as security to satisfy in whole or in part such
Bankers' Acceptance Obligations upon the expiry of the applicable BA
Term and the Borrower shall execute in respect thereof any security
documents reasonably required by the Agent.
Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents
thereof and of such Bank's share (if any) of such prepayment and such
notice shall not thereafter be revocable by the Borrower.
2.12 General Provisions as to Payments.
Each payment on account of the Borrowings or Letter of Credit
Liabilities and of fees hereunder shall be made not later than 2:00
p.m. (Toronto time) on the date when due in immediately available funds
in Toronto to the Agent at its address referred to in Section 10.1.
The Agent will promptly using all reasonable efforts distribute to each
Bank on the same Business Day its ratable share of each such payment
received by the Agent for the account of the Banks. Whenever any
payment of principal of, or interest on, Prime Rate Loans or USBR Loans
or payments in respect of Bankers' Acceptance Obligations or Letter of
Credit Liabilities or of fees shall be due on a day which is not a
Business Day, the date for payment thereof shall be extended to the
next succeeding Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Business Day, the date for payment thereof shall be extended to the
next succeeding Business Day unless such Business Day falls in another
calendar month, in which case the date for payment thereof shall be the
next preceding Business Day. If the date for any payment of principal
is extended by operation of law or otherwise, interest thereon shall be
payable for such extended time.
Unless the Agent shall have received notice from a Borrower
prior to the date on which any payment is due from such Borrower to the
Banks hereunder that such Borrower will not make such payment in full,
the Agent may assume that such Borrower has made such payment in full
to the Agent on such date and the Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an
amount equal to the amount then due such Bank. If and to the extent
that such Borrower shall not have so made such payment, each Bank
shall repay to the Agent forthwith on demand such amount distributed to
such Bank together with interest thereon, for each day from the date
such amount is distributed to such Bank until the date such Bank repays
such amount to the Agent at the Federal Funds Rate, in the case of US$
Borrowings, and the CDOR Prime Rate, in the case of C$ Borrowings.
The Borrowers authorize and direct the Agent, in the Agent's
discretion, to debit automatically, by mechanical, electronic or manual
means, any bank account of the Borrower maintained with Royal Bank of
Canada (for so long as Royal Bank of Canada is Agent) for all amounts
payable by such Borrower under this Agreement, including the repayment
of principal and the payment of interest, fees and charges for the
keeping of that bank account. The Agent shall notify the Borrower as
to the particulars of those debits in the normal course.
2.13 Funding. If a Borrower makes any payment of principal with
respect to any Euro-Dollar Loan or any Euro-Dollar Loan is converted to
a USBR Loan or continued as a Euro-Dollar Loan for a new Interest
Period (pursuant to any provision of this Agreement, including, without
limitation, pursuant to sections 2.8, 2.9, 2.11 and 8.2) on any day
other than the last day of an Interest Period applicable thereto, or if
a Borrower fails to borrow, prepay, convert or continue any Euro-Dollar
Loans after notice has been given to any Bank in accordance with
Section 2.3(a), 2.8, 2.9 or 2.11 (other than by reason of a default by
the Bank demanding payment hereunder), such Borrower shall reimburse
each Bank within 15 days after written demand from such Bank for any
resulting loss or reasonable expense suffered or incurred by it (or by
an existing or prospective Participant in the related Advance, but not
to exceed the loss and expense which would have been incurred by such
Bank had no participations been granted by it), including (without
limitation) any loss incurred in obtaining, liquidating or re-employing
deposits or other funds or any interest or other charges together with
any other charges, costs or expenses incurred relative thereto from or
payable to third parties, but excluding loss of profit or margin for
the period after any such payment or conversion or failure to borrow,
prepay, convert or continue, provided that such Bank shall have
delivered to such Borrower a certificate setting forth in reasonable
detail the calculation of the amount of such loss or expense, which
certificate shall be presumptively correct in the absence of manifest
error.
2.14 Computation of Interest and Fees. Interest based on the
LIBOR Rate or the Federal Funds Rate hereunder shall be computed on the
basis of a year of 360 days and paid for the actual number of days
elapsed (including the first day but excluding the last day). All
other interest and all fees shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid, except as otherwise
provided in subsection 2.7(c), for the actual number of days elapsed
(including the first day but excluding the last day).
2.15 Additional Bankers' Acceptances Provisions.
Bankers' Acceptances in Blank. To facilitate the acceptance
of Bankers' Acceptances under this Agreement, each Borrower shall, upon
becoming a party hereto and from time to time as required, provide to
the Agent drafts ("Drafts"), in form satisfactory to the Agent, duly
executed and endorsed in blank by such Borrower in quantities
sufficient for each Bank to fulfill its obligations hereunder or if so
agreed by the Bank and the Borrower, provide that Bank, with a copy to
the Agent, a power of attorney in the form of Exhibit F-1 authorizing
such Bank to execute and endorse Drafts on behalf of the Borrower.
Each Bank is hereby authorized to complete the missing details of each
such Draft in accordance with the Borrower's instructions in a Notice
of Borrowing on each such Bankers' Acceptances endorsed in blank in
such Face Amounts as may be determined by such Bank provided that the
aggregate amount thereof is equal to the aggregate amount of Bankers'
Acceptances required to be accepted by such Bank. No Bank shall be
responsible or liable for its failure to accept a Bankers' Acceptance
if the cause of such failure is, in whole or in part, due to the
failure of any Borrower to provide duly executed and endorsed Drafts to
the Agent on a timely basis, nor shall any Bank be liable for any
damage, loss or other claim arising by reason of any loss or improper
use of any such instrument except loss or improper use arising by
reason of the gross negligence or willful misconduct of such Bank, its
officers, employees, agents or representatives. Each Bank shall
maintain a record with respect to Bankers' Acceptances (i) received by
it from the Agent in blank hereunder, (ii) voided by it for any reason,
(iii) accepted by it hereunder, (iv) purchased by it hereunder and (v)
cancelled at their respective maturities. Each Bank further agrees to
retain such records in the manner and for the statutory periods
provided in the various Canadian provincial or federal statutes and
regulations which apply to such Bank.
Execution of Bankers' Acceptances. Drafts of any Borrower to
be accepted as Banker's Acceptances hereunder shall be duly executed on
behalf of such Borrower. Notwithstanding that any person whose
signature appears on any Bankers' Acceptance as a signatory for any
Borrower may no longer be an authorized signatory for such Borrower at
the date of issuance of a Bankers' Acceptance, such signature shall
nevertheless be valid and sufficient for all purposes as if such
authority had remained in force at the time of such issuance, and any
such Bankers' Acceptance so signed shall be binding on such Borrower.
Issuance of Bankers' Acceptances. The aggregate face amount
of Bankers' Acceptances to be accepted by a Bank shall be determined by
the Agent on a pro rata basis by reference to the respective
Commitments of the Banks, except that, if the face amount of a Bankers'
Acceptance, which would otherwise be accepted by a Bank, would not be
C$100,000 or a whole multiple thereof, such face amount shall be
increased or reduced by the Agent in its sole and unfettered discretion
to the nearest whole multiple of C$100,000.
Purchase of Bankers' Acceptances. All Bankers' Acceptances
accepted by a Bank shall be purchased by the Bank at the Applicable BA
Discount Rate. The Stamping Fee payable by a Borrower in respect of
each such Bankers' Acceptance under Section 2.7(c) shall be set off
against the BA Discount Proceeds payable by such Bank.
Sale of Bankers' Acceptances. Each Bank may at any time and
from time to time hold, sell, rediscount or otherwise dispose of any or
all Bankers' Acceptances accepted and purchased by it.
Repayment. Any repayment or refunding of Bankers' Acceptance
Obligations, must be made at or before 2:00 p.m. (Toronto time), on the
expiry of the applicable BA Term.
Waiver of Presentment and Other Conditions. Each Borrower
waives presentment for payment and any other defence to payment of any
amounts due to a Bank in respect of a Bankers' Acceptance accepted by
it pursuant to this Agreement which might exist solely by reason of
such Bankers' Acceptance being held, at the maturity thereof, by such
Bank in its own right, and each Borrower agrees not to claim any days
of grace if such Bank as holder sues such Borrower on the Bankers'
Acceptances for payment of the amount payable by each Borrower
thereunder.
Acceptance Note Banks.
It is understood that from time to time
certain Banks (other than Schedule I Banks) may not be
authorized to or may, as a matter of general corporate
policy, elect not to accept Drafts (each, an "Acceptance
Note Bank"); accordingly, any such Bank may instead
purchase Acceptance Notes of the relevant Borrower in
lieu of accepting and purchasing Bankers' Acceptances
for such Borrower's account.
In connection with any request by a Borrower
for the creation of Bankers' Acceptances, such Borrower
shall deliver to each Acceptance Note Bank non-interest
bearing promissory notes (each, an "Acceptance Note") of
such Borrower, substantially in the form of Exhibit C,
having the same maturity as the Bankers' Acceptances to
be accepted and purchased as part of the Group of
Advances and in an aggregate principal amount equal to
the aggregate Face Amount of the Bankers' Acceptances
that would otherwise have been required to be accepted
by such Bank. Alternatively, such Borrower may provide
the Bank with a power of attorney in the form of Exhibit
F-2 authorizing such Bank to execute and complete
Acceptance Notes on behalf of such Borrower. Each such
Bank hereby agrees to purchase Acceptance Notes from
either of the Borrowers at the Applicable BA Discount
Rate which would have been applicable if a Draft had
been accepted by it (less any Stamping Fee which would
have been paid pursuant to Section 2.7(c) if such Bank
had created a Bankers' Acceptance), and such Acceptance
Notes shall be governed by the provisions of this
Agreement as if they were Bankers' Acceptances and, for
greater certainty, be deemed to be Advances made
pursuant to section 2.1(a).
2.16 Letters of Credit.
Subject to the terms and conditions hereof, each Issuing Bank
agrees to issue Letters of Credit hereunder from time to time, subject
to subsection 2.16(c), upon the request of any Borrower; provided that,
immediately after each Letter of Credit is issued (i) the aggregate
amount of the Letter of Credit Liabilities plus the aggregate
outstanding amount of all Loans and Bankers' Acceptance Obligations
shall not exceed the aggregate amount of the Commitments and (ii) the
aggregate Letter of Credit Liabilities shall not exceed US$25,000,000.
Each Letter of Credit issued under this subsection shall be for a
minimum of US$5,000,000 with a term no longer than 365 days. The
Borrower may request Letters of Credit to be denominated in C$ or US$.
Upon the date of issuance by an Issuing Bank of a Letter of Credit, the
Issuing Bank shall be deemed, without further action by any party
hereto, to have sold to each Bank, and each Bank shall be deemed,
without further action by any party hereto, to have purchased from the
Issuing Bank, a participation in such Letter of Credit and the related
Letter of Credit Liabilities in the proportion its Commitment bears to
the aggregate Commitments.
The Borrower shall give an Issuing Bank notice at least three
Business Days prior to the requested issuance of a Letter of Credit
specifying the date such Letter of Credit is to be issued, and
describing the terms of such Letter of Credit and the nature of the
transactions to be supported thereby (such notice, including any such
notice given in connection with the extension of a Letter of Credit, a
"Notice of Issuance"). Upon receipt of a Notice of Issuance, the
Issuing Bank shall promptly notify the Agent, and the Agent shall
promptly notify each Bank of the contents thereof and of the amount of
such Bank's participation in such Letter of Credit. The issuance by the
Issuing Bank of each Letter of Credit shall, in addition to the
conditions precedent set forth in Article 3, be subject to the
conditions precedent that such Letter of Credit shall be in such form
and contain such terms as shall be reasonably satisfactory to the
Issuing Bank and that the Borrower shall have executed and delivered
such other instruments and agreements relating to such Letter of Credit
as the Issuing Bank shall have reasonably requested. The Borrower shall
also pay to the Issuing Bank for its own account amendment and
extension charges in the amounts and at the times as agreed between the
Borrower and the Issuing Bank. The extension or renewal of any Letter
of Credit shall be deemed to be an issuance of such Letter of Credit,
and if any Letter of Credit contains a provision pursuant to which it
is deemed to be extended unless notice of termination is given by the
Issuing Bank, the Issuing Bank shall timely give such notice of
termination with a copy to the Agent.
No Letter of Credit shall have a term extending or extendible
beyond the fifth Business Day preceding the Termination Date.
Upon receipt from the beneficiary of any Letter of Credit of
any notice of a drawing under such Letter of Credit, the Issuing Bank
shall notify the Agent and the Agent shall promptly notify the Borrower
and each other Bank as to the amount to be paid as a result of such
demand or drawing and the payment date. The Borrower shall be
irrevocably and unconditionally obligated forthwith to reimburse the
Issuing Bank for any amounts paid by the Issuing Bank upon any drawing
under any Letter of Credit made in accordance with the provisions of
this Agreement and the applicable Letter of Credit, without
presentment, demand, protest or other formalities of any kind. In the
event of a drawing under a Letter of Credit, the Borrower shall, unless
it gives not less than one Business Day's notice to the Agent to the
contrary, be deemed to have timely given a Notice of Borrowing for a
Prime Rate Borrowing for a Letter of Credit denominated in C$ and a
USBR Borrowing for a Letter of Credit denominated in US$ on the date of
such drawing in the exact amount due the Issuing Bank hereunder on such
date, and the Agent shall apply the proceeds of such Borrowing to make
payment thereof.
All such amounts paid by the Issuing Bank and remaining
unpaid by the Borrower shall bear interest, payable on demand, for each
day until paid at a rate per annum equal to the US Base Rate for
amounts paid in US$ and, the Prime Rate for amounts paid in C$, for
such day plus, if such amount remains unpaid for more than one Business
Day, 2%; provided that if and to the extent the failure to pay such
principal or interest when due is attributable to default by a Bank in
making an Advance which such Bank was obligated to make hereunder, such
interest shall accrue at a rate per annum equal to the US Base Rate for
amounts paid in US$ and the Prime Rate for amounts paid in C$, from and
including the date such payment was due to but not including the first
Business Day thereafter and shall accrue at a rate per annum equal to
the sum of 2% plus the US Base Rate for amounts paid in US$ and, the
Prime Rate for amounts paid in C$, from and including such first
succeeding Business Day until paid. In addition, each Bank will pay to
the Agent, for the account of the Issuing Bank, immediately upon the
Issuing Bank's demand (which demand shall be made to the Agent) at any
time during the period commencing after such drawing until
reimbursement therefor in full by the Borrower, an amount equal to such
Bank's ratable share of such drawing (in proportion to its
participation therein), together with interest on such amount for each
day from the date of the Issuing Bank's demand for such payment (or, if
such demand is made after 10:00 a.m. (Toronto time) on such date, from
the next succeeding Business Day) to the date of payment by such Bank
of such amount at a rate of interest per annum equal to the Federal
Funds Rate for drawings in US$ and the CDOR Prime Rate for drawings in
C$. The Issuing Bank will pay to each Bank ratably all amounts
received from the Borrower for application in payment of its
reimbursement obligations in respect of any Letter of Credit, but only
to the extent such Bank has made payment to the Issuing Bank in respect
of such Letter of Credit pursuant hereto.
The obligations of each Borrower and Bank under subsections
2.16(d) and 2.16(e) above shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the
terms of this Agreement and the terms of the relevant Letter of Credit,
under all circumstances whatsoever, including without limitation the
following circumstances:
the use which may be made of the Letter of
Credit by, or any acts or omission of, a beneficiary of
a Letter of Credit (or any Person for whom the
beneficiary may be acting);
the existence of any claim, set-off, defence
or other rights that such Borrower may have at any time
against a beneficiary of a Letter of Credit (or any
Person for whom the beneficiary may be acting), the
Banks (including the Issuing Bank), any other Borrower
or any other Person, whether in connection with this
Agreement or the Letter of Credit or any document
related hereto or thereto or any unrelated transaction;
any statement or any other document presented
under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement
therein being untrue or inaccurate in any respect
whatsoever;
any other act or omission to act or delay of
any kind by any Bank (including the Issuing Bank), the
Agent or any other Person or any other event or
circumstance whatsoever that might, but for the
provisions of this subsection (iv), constitute a legal
or equitable discharge of such Borrower's or Bank's
obligations hereunder;
provided however that nothing in this subsection 2.16(f) shall relieve
the Issuing Bank, the Agent or any other Bank of legal responsibility
it would otherwise have for the consequences of its own gross
negligence or willful misconduct.
Each Borrower hereby indemnifies and holds harmless each Bank
(including each Issuing Bank) and the Agent from and against any and
all liabilities, losses, damages, costs or out-of-pocket expenses which
such Bank or the Agent may incur (including, without limitation, any
liabilities, losses, damages, costs or out-of-pocket expenses which an
Issuing Bank may incur by reason of or in connection with the failure
of any other Bank to fulfill or comply with its obligations to such
Issuing Bank hereunder (but nothing herein contained shall affect any
rights the Borrower may have against such defaulting Bank)), and none
of the Banks (including the Issuing Banks) nor the Agent nor any of
their officers or directors or employees or agents shall be liable or
responsible, by reason of or in connection with the execution and
delivery or transfer of or payment or failure to pay under any Letter
of Credit issued at the request of such Borrower, including without
limitation any of the circumstances enumerated in subsection 2.16(f)
above, as well as (i) any error, omission, interruption or delay in
transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, (ii) any loss or delay in the transmission of any
document required in order to make a drawing under a Letter of Credit,
and (iii) any consequences arising from causes beyond the control of
the Issuing Bank, including without limitation any government acts, or
any other circumstances whatsoever in making or failing to make payment
under such Letter of Credit; provided that such Borrower shall not be
required to indemnify the Issuing Bank for any claims, damages, losses,
liabilities, costs or expenses, and the Borrower shall have a claim for
direct damage suffered by it, to the extent found by a court of
competent jurisdiction to have been caused by (x) the willful
misconduct or gross negligence of the Issuing Bank in determining
whether a request presented under any such Letter of Credit complied
with the terms of such Letter of Credit or (y) the Issuing Bank's
failure to pay under any such Letter of Credit after the presentation
to it of a request strictly complying with the terms and conditions of
such Letter of Credit. Nothing in this subsection 2.16(g) is intended
to limit the obligations of any Borrower under any other provision of
this Agreement. To the extent any Borrower does not indemnify an
Issuing Bank as required by this subsection, the Banks agree to do so
ratably in accordance with their Commitments.
2.17 Takeout of Swingline Loans.
In the event that any Swingline Loan shall not be repaid in
full at the maturity thereof the Agent shall, on behalf of the Borrower
(each Borrower hereby irrevocably directing and authorizing the Agent
so to act on its behalf), give a Notice of Borrowing requesting the
Banks, including the Swingline Bank, to, in the case of a Swingline
Loan in C$, make a Prime Rate Loan or, in the case of a Swingline Loan
in US$, make a USBR Loan (which Loan shall be deemed to be made
pursuant to subsection 2.1(a) hereof) on the maturity date of such
Swingline Loan in an amount equal to such Bank's pro rata share (based
on the proportion its Commitment bears to the aggregate Commitment) of
the unpaid principal amount of such Swingline Loan. Each Bank will
make the proceeds of its Prime Rate Loan or USBR Loan, as the case may
be, included in such Borrowing available to the Agent for the account
of the Swingline Bank which made such Swingline Loan on such date in
accordance with Section 2.3. The proceeds of such Prime Rate Borrowing
or USBR Borrowing, as the case may be, shall be immediately applied to
repay such Swingline Loan.
If, for any reason, a Prime Rate Borrowing or USBR Borrowing,
as the case may be, may not be (as determined by the Agent in its sole
discretion acting reasonably and in good faith), or is not, made
pursuant to subsection (a) above to refund a Swingline Loan as required
by said subsection, then, effective on the date such Borrowing would
otherwise have been made, each Bank severally, unconditionally and
irrevocably agrees that it shall purchase an undivided participating
interest in such Swingline Loan (an "Unrefunded Swingline Loan") in an
amount equal to the amount of the Loan which otherwise would have been
made by such Bank pursuant to subsection (a), which purchase shall be
funded by the time such Loan would have been required to be funded
pursuant to Section 2.3 by transfer to the Agent, for the account of
the Swingline Bank, in immediately available funds, of the amount of
its participation.
Whenever, at any time after the Swingline Bank has received
from any Bank payment in full for such Bank's participating interest in
a Swingline Loan, the Swingline Bank (or the Agent on its behalf)
receives any payment on account of such Swingline Loan, the Swingline
Bank (or the Agent, as the case may be) will promptly distribute to
such Bank its participating interest in such payment (appropriately
adjusted, in the case of interest payments, to reflect the period of
time during which such Bank's participating interest was outstanding
and funded); provided, however, that in the event that such payment is
subsequently required to be returned, such Bank will return to the
Swingline Bank (or the Agent, as the case may be) any portion thereof
previously distributed by the Swingline Bank (or the Agent, as the case
may be) to it.
Each Bank's obligation to purchase and fund participating
interests pursuant to this Section shall be absolute and unconditional
and shall not be affected by any circumstance, including, without
limitation: any set-off, counterclaim, recoupment, defence or other
right which such Bank or the Borrower may have against any Swingline
Bank, or any other Person for any reason whatsoever; the occurrence or
continuance of a Default or the failure to satisfy any of the
conditions specified in Article 3; any adverse change in the condition
(financial or otherwise) of the any Borrower; any breach of this
Agreement by any Borrower or any Bank; or any other circumstance,
happening or event whatsoever, whether or not similar to any of the
foregoing.
2.18 Currency Fluctuations. If, on the first Business Day of any
calendar month, the aggregate outstanding principal amount of the Loans
by any Bank, together with its Bankers' Acceptance Obligations and
Letter of Credit Liabilities and its participating interests in any
Unrefunded Swingline Loans, at any time outstanding to all Borrowers,
exceeds 105% of such Bank's Commitment then in effect, then, within
three Business Days after notice to the Borrowers from the Agent, the
Borrowers shall prepay the Loans or, at the option of the Borrowers,
(or if the repayment of the Loans shall be insufficient to satisfy its
obligation under this Section the Borrowers shall) provide full cash
collateral to the Agent, in the amount of such excess such that after
giving effect thereto, the outstanding amount of Loans, together with
its Bankers' Acceptance Obligations and Letter of Credit Liabilities
and its participating interests in any Unrefunded Swingline Loans, of
each Bank shall not exceed such Bank's Commitment then in effect. The
Agent shall promptly furnish each Bank with a copy of any notice
delivered to the Borrowers pursuant to this section.
2.19 Criminal Rate of Interest. Notwithstanding the foregoing
provisions of this Article 2, the Borrower shall in no event be obliged
to make any payments of interest or other amounts payable to the Agent
or any of the Banks hereunder in excess of an amount or rate which
would be prohibited by law or would result in the receipt by any of
them of interest at a criminal rate (as such terms are construed under
the Criminal Code (Canada)).
2.20 Compliance with the Interest Act (Canada). For the purposes
of this Agreement, whenever any interest is calculated on the basis of
a period of time other than a calendar year, the annual rate of
interest to which each rate of interest determined pursuant to such
calculation is equivalent for the purposes of the Interest Act (Canada)
is such rate as so determined multiplied by the actual number of days
in the calendar year in which the same is to be ascertained and divided
by the number of days used in the basis of such determination.
ARTICLE
CONDITIONS
3.1 Effectiveness. This Agreement shall become effective on the
date that each of the following conditions shall have been satisfied
(or waived in accordance with Section 10.8):
receipt by the Agent of counterparts hereof signed by each of
the parties hereto (or, in the case of any party as to which an
executed counterpart shall not have been received, receipt by the Agent
in form satisfactory to it of telegraphic, telecopy, telex or other
written confirmation from such party of execution of a counterpart
hereof by such party);
receipt by the Agent of an opinion of (i) Fraser & Xxxxxx,
special counsel to the Borrowers, substantially in the form of Exhibit
E-1 hereto, (ii) Sidley & Austin, substantially in the form of Exhibit
E-2 hereto and (iii) Xxxxxxxxx X. Xxxxx, General Counsel of the
Guarantor, substantially in the form of Exhibit E-3 hereto, and in each
case covering such additional matters relating to the transactions
contemplated hereby as the Required Banks may reasonably request;
receipt by the Agent of an opinion of Xxxxxx, Xxxx & Xxxx,
special counsel for the Agent, covering such additional matters
relating to the transactions contemplated hereby as the Banks may
reasonably request;
receipt by the Agent of all documents it may have reasonably
requested prior to the date hereof relating to the existence of each
Borrower and the Guarantor, the corporate authority for and the
validity of this Agreement, and any other matters relevant hereto, all
in form and substance satisfactory to the Agent;
receipt by the Agent of evidence satisfactory to it that the
Merger shall have been consummated in accordance with the Merger
Agreement, without any amendment thereof or waiver thereto which (i) is
material in the context of this Agreement and (ii) the Required Banks
shall not have consented to in writing; and
receipt by the Agent of evidence satisfactory to it of the
payment of all principal of and interest on any loans outstanding
under, and all accrued fees under, the Existing Credit Agreements and
of the termination of the commitments of the lenders thereunder; and
the Guarantor's Credit Agreements have been duly executed and
all conditions precedent to the effectiveness thereof as set out
therein have been satisfied;
provided that this Agreement shall not become effective or be binding
on any party hereto unless all of the foregoing conditions are
satisfied not later than January 15, 1998; and provided further that
the provisions of Sections 2.7, 2.8, 2.13 and 10.4 shall become
effective upon satisfaction of the condition specified in clause
3.1(a). The Agent shall promptly notify the Borrowers and the Banks of
the Effective Date, and such notice shall be conclusive and binding on
all parties hereto.
3.2 Borrowings and Issuance of Letters of Credits. The
obligation of any Bank to make an Advance on the occasion of any
Borrowing and the obligation of the Issuing Banks to issue (or renew or
extend the term of) any Letter of Credit is subject to the satisfaction
of the following conditions; provided that in the case of Borrowings to
repay an outstanding Swingline Loan, only the conditions set forth in
clauses 3.2(a) and 3.2(b) must be satisfied:
receipt by the Agent of a Notice of Borrowing as required by
Section 2.2 or 2.3 or receipt by the Issuing Bank of a Notice of
Issuance as required by Section 2.16(b), as the case may be;
the fact that, immediately after such Borrowing or issuance
of such Letter of Credit, the sum of the aggregate outstanding
principal amount of the Loans and the aggregate amount of Bankers'
Acceptance Obligations and Letters of Credit Liabilities will not
exceed the aggregate amount of the Commitments, the aggregate
outstanding principal amount of Swingline Loans will not exceed
US$10,000,000 and the aggregate amount of Letter of Credit Liabilities
will not exceed US$25,000,000;
the fact that, immediately after such Borrowing or issuance
of such Letter of Credit, no Default shall have occurred and be
continuing; and
the fact that the representations and warranties (other than
the representations and warranties set forth in clauses 4.1(d)(ii) and
4.2(b)(ii) in the case of a Borrowing which does not result in an
increase in the sum of the aggregate outstanding principal amount of
the Loans, the aggregate Bankers' Acceptance Obligations and the
aggregate Letter of Credit Liabilities) of the Borrowers and the
Guarantor contained in this Agreement shall be true on and as of the
date of such Borrowing or issuance of such Letter of Credit.
Each Borrowing and each issuance of a Letter of Credit hereunder shall
be deemed to be a representation and warranty by the Borrower and the
Guarantor on the date of such Borrowing as to the facts specified in
clauses (b), (c) and (d) of this Section (unless such Borrowing is made
to refund a Swingline Borrowing, in which case the Borrower shall be
deemed to represent and warrant as to the facts specified in clause (b)
of this Section).
ARTICLE
REPRESENTATIONS AND WARRANTIES
4.1 Borrowers. Each of the Borrowers represent and warrant for
itself that:
Corporate Existence and Power. Each of the Borrowers is a
corporation duly incorporated, validly existing and in good standing
under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its
business as now conducted and is duly qualified to do business as a
foreign corporation in each jurisdiction where such qualification is
required, except where the failure so to qualify could not reasonably
be expected to have a Material Adverse Effect.
Corporate and Governmental Authorization; No Contravention.
The execution, delivery and performance by each of the Borrowers of
this Agreement are within the Borrower's corporate powers, have been
duly authorized by all necessary corporate action, require no action by
or in respect of, or filing with, any governmental body, agency or
official and do not contravene, or constitute a default under, any
provision of applicable law or regulation or of the certificate of
incorporation or by-laws of either of the Borrowers or of any
agreement, judgment, injunction, order, decree or other instrument
binding upon either of the Borrowers or any of its Subsidiaries or
result in the creation or imposition of any Lien on any asset of the
Borrowers or any of their Subsidiaries.
Binding Effect. This Agreement constitutes a valid and
binding agreement of each of the Borrowers, in each case enforceable in
accordance with its terms, except as the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and by general principles of equity.
Financial Information.
The unaudited balance sheet of each of IMC
Kalium and IMC Potash as of June 30, 1997 and the
related unaudited statements of earnings, cash flows and
changes in stockholders' equity for the fiscal year then
ended, copies of which have been delivered to each of
the Banks, fairly present, the financial position of
each of IMC Kalium and IMC Potash and their respective
Consolidated Subsidiaries as of such date and its
consolidated results of operations and cash flows for
such fiscal year.
Since June 30, 1997, there has been no
material adverse change in the business, financial
position or results of operations of either of IMC
Kalium and IMC Potash and their Consolidated
Subsidiaries, considered as a whole.
Litigation. Except as disclosed in the Guarantor's annual
report on Form 10-K for the year ended June 30, 1997, each registration
statement (other than a registration statement on Form S-8 (or its
equivalent)) and each report on Form 10-K, 10-Q and 8-K (or their
equivalents) which the Guarantor shall have filed with the United
States Securities and Exchange Commission at any time thereafter, and
the proxy statement and prospectus delivered to the shareholders of the
Guarantor in connection with the Merger, copies of which have been
delivered to each of the Banks, there is no action, suit or proceeding
pending against, or to the knowledge of either of the Borrowers,
threatened against or affecting, the Borrowers or any of their
Subsidiaries before any court or arbitrator or any governmental body,
agency or official which could reasonably be expected to have a
Material Adverse Effect on the Borrowers or which in any manner draws
into question the validity of this Agreement.
Compliance with Laws. Each of the Borrowers and each of
their Subsidiaries is in compliance in all material respects with all
applicable laws, ordinances, rules, regulations and requirements of
governmental authorities (including, without limitation, Environmental
Laws) except where (i) non-compliance could not reasonably be expected
to have a Material Adverse Effect or (ii) the necessity of compliance
therewith is contested in good faith by appropriate proceedings.
Environmental Matters. In the ordinary course of its
business, each of the Borrowers conducts a systematic review of the
effects and reasonably ascertainable associated liabilities and costs
of Environmental Laws on the business, operations and properties of the
Borrowers and their Subsidiaries. The associated liabilities and costs
include, without limitation: any capital or operating expenditures
required for clean-up or closure of properties presently or previously
owned; any capital or operating expenditures required to achieve or
maintain compliance with Environmental Laws; any constraints on
operating activities related to achieving or maintaining compliance
with Environmental Laws, including any periodic or permanent shutdown
of any facility or reduction in the level or change in the nature of
operations conducted thereat; any costs or liabilities in connection
with off-site disposal of wastes or hazardous substances; and any
actual or potential liabilities to third parties, including employees,
arising under Environmental Laws, and any related costs and expenses.
On the basis of this review, the Borrowers have reasonably concluded
that such associated liabilities and costs, including the costs of
compliance with Environmental Laws, could not reasonably be expected to
have a Material Adverse Effect.
Taxes. Each of the Borrowers and its Subsidiaries have filed
or caused to be filed all tax returns which are required to be filed
and has paid all taxes shown to be due and payable on said returns or
on any assessments made against it or any of its property and all other
taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority except (i) where nonpayment could not
reasonably be expected to have a Material Adverse Effect or (ii) where
the same are contested in good faith by appropriate proceedings. No
tax Lien has been filed and no claim is being asserted, with respect to
any such tax, fee or other charge, except as could not reasonably be
expected to have a Material Adverse Effect. The charges, accruals and
reserves on the books of each the Borrowers and its Subsidiaries in
respect of taxes or other governmental charges are adequate.
Subsidiaries. Each of the Borrowers' Subsidiaries is a
corporation validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all
material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted and is duly
qualified to do business as a foreign corporation in each jurisdiction
where such qualification is required, except where the failure so to
qualify could not reasonably be expected to have Material Adverse
Effect.
Full Disclosure. The information contained in the
Information Memorandum and the supplemental information provided by the
Borrowers is true and correct in all material respects as at the date
thereof and does not omit to disclose any information necessary to
ensure that the information therein contained is not misleading. As at
the date hereof, any information contained in the Information
Memorandum is not incorrect or misleading by reference to the facts and
circumstances existing at such date. All other information provided
from time to time by the Borrowers pursuant to this Agreement shall be,
at the time the same is so furnished, true and accurate in all material
respects and will not be misleading in the context in which it is
provided.
4.2 Guarantor.
The Guarantor repeats the representations and warranties made
in subsections 4.1(a) to (c) inclusive and 4.1(f), (g) and (i), as if
the references to "Borrower" therein (as the context so permits) were
read as "Guarantor".
The Guarantor also represents and warrants that:
Financial Information. The consolidated
balance sheet of the Guarantor and its Consolidated
Subsidiaries as of June 30, 1997 and the related
consolidated statements of earnings, cash flows and
changes in stockholders' equity for the fiscal year then
ended, reported on by Ernst & Young LLP, copies of which
have been delivered to each of the Banks, fairly
present, in conformity with generally accepted
accounting principles, the consolidated financial
position of the Guarantor and its Consolidated
Subsidiaries as of such date and their
consolidated results of operations and cash flows for
such fiscal year.
No Material Adverse Change. Since June 30,
1997, there has been no material adverse change in the
business, financial position or results of operations of
the Guarantor and its Consolidated Subsidiaries,
considered as a whole.
Litigation. Except as disclosed in the
Guarantor's annual report on Form 10-K for the year
ended June 30, 1997, each registration statement (other
than a registration statement on Form S-8 (or its
equivalent)) and each report on Form 10-K, 10-Q and 8-K
(or their equivalents) which the Guarantor shall have
filed with the Securities and Exchange Commission at any
time thereafter, and the proxy statement and prospectus
delivered to the shareholders of the Guarantor in
connection with the Merger, copies of which have been
delivered to each of the Banks, there is no action, suit
or proceeding pending against, or to the knowledge of
the Guarantor, threatened against or affecting, the
Guarantor or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official
which could reasonably be expected to have a Material
Adverse Effect or which in any manner draws into
question the validity of this Agreement.
ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding
standards of ERISA and the Internal Revenue Code with
respect to each Plan and is in compliance in all
material respects with the presently applicable
provisions of ERISA and the Internal Revenue Code with
respect to each Plan. No member of the ERISA Group has
(i) sought a waiver of the minimum funding standard
under Section 412 of the Internal Revenue Code in
respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer
Plan or in respect of any Benefit Arrangement, or made
any amendment to any Plan or Benefit Arrangement, which
has resulted or could result in the imposition of a Lien
or the posting of a bond or other security under ERISA
or the Internal Revenue Code or (iii) incurred any
liability under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA.
Regulatory Restrictions on Borrowing. The
Guarantor is not an "investment company" within the
meaning of the Investment Company Act of 1940, as
amended, a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended,
or otherwise subject to any regulatory scheme which
restricts its ability to incur debt.
Full Disclosure. Neither the Guarantor's Form
10-K for the year ended June 30, 1997, as of the date of
filing of such Form 10-K, nor any registration statement
(other than a registration statement on Form S-8 (or its
equivalent)) or report on Form 10-K, 10-Q and 8-K (or
their equivalents) which the Guarantor shall have filed
with the Securities and Exchange Commission as at the
time of filing of such registration statement or report,
as applicable, contained any untrue statement of a
material fact or omitted to state a material fact
necessary in order to make any statements contained
therein, in the light of the circumstances under which
they were made, not misleading; provided that to the
extent any such document contains forecasts and/or
projections, it is understood and agreed that
uncertainty is inherent in any forecasts or projections
and that no assurances can be given by the Guarantor of
the future achievement of such performance.
ARTICLE
COVENANTS
5.1 Borrowers. Each of the Borrowers agree that, so long as any
Bank has any Commitment hereunder or any amount payable hereunder
remains unpaid or any Bankers' Acceptance Obligation or Letter of
Credit Liabilities remain outstanding:
Information. Each of the Borrowers will deliver to the
Agent:
as soon as available and in any event within
95 days after the end of each fiscal year of each of IMC
Kalium and IMC Potash, an unaudited balance sheet of
each of IMC Kalium and IMC Potash and their respective
Subsidiaries as at the end of such fiscal year and the
related unaudited statements of earnings, cash flows,
and changes in stockholders' equity for such fiscal
year, setting forth in each case in comparative form the
figures for the previous fiscal year, all prepared on a
basis consistent with the financial statements referred
to in Section 4.1(d) hereof provided that if, at any
time, IMC Canada shall cease to be a direct, wholly-
owned subsidiary of IMC Potash, the Borrower shall
thereafter deliver the balance sheet and statements of
IMC Canada in lieu of the corresponding balance sheets
and statements of IMC Potash;
within five days after any officer of the
Borrower obtains knowledge of any Default, if such
Default is then continuing, a certificate of an Approved
Officer of such Borrower setting forth the details
thereof and the
action which the Borrower is taking or proposes to take
with respect thereto;
promptly after any officer of the Borrower
obtains knowledge (i) of a proposed transaction which
will result in the occurrence of an event described in
Section 6.1(m) or the occurrence thereof, (ii) that the
representations and warranties made in subsection 4.1(e)
and clauses 4.1(d)(ii), 4.2(b)(ii) and (iii) have ceased
to be true and correct or (iii) the occurrence of any
Event of Default; and
from time to time such additional information
regarding the financial position or business of the
Borrowers and their respective Subsidiaries as the
Agent, at the request of any Bank, may reasonably
request.
Payment of Obligations. Each of the Borrowers will pay and
discharge, and will cause each of their Subsidiaries to pay and
discharge, at or before maturity, all their respective material
obligations and liabilities (including, without limitation, tax
liabilities and claims of materialmen, warehousemen and the like which
if unpaid might by law give rise to a Lien), except where the same may
be contested in good faith by appropriate proceedings, and will
maintain, and will cause each of their Subsidiaries to maintain, in
accordance with generally accepted accounting principles, appropriate
reserves for the accrual of any of the same.
Maintenance of Property; Insurance.
The Borrowers will keep, and will cause each
of their Subsidiaries to keep, all material property
useful and necessary in its business in good working
order and condition, ordinary wear and tear excepted.
The Borrowers will, and will cause each of
their Subsidiaries to, maintain (either in the name of
the relevant Borrower or in such Borrower's or
Subsidiary's own name) with financially sound and
responsible insurance companies, insurance on all its
respective properties in at least such amounts, against
at least such risks and with such risk retention as are
usually maintained, insured against or retained, as the
case may be, in the same general area by companies of
established repute engaged in the same or a similar
business; provided that the Borrowers and their
Subsidiaries may self-insure to the same extent as other
companies of established repute engaged in the same or a
similar business in the same general area in which such
Borrowers or such Subsidiaries operates and to the
extent consistent with prudent business practice. The
Borrower will furnish to the Banks, upon request from
the Agent, information presented in reasonable detail as
to the insurance so carried.
Conduct of Business and Maintenance of Existence. The
Borrowers and their Subsidiaries taken as a whole will continue to
engage in business of the same general type as now conducted by such
Borrowers and their Subsidiaries and any ancillary or related lines of
business, and each Borrower will preserve, renew and keep in full force
and effect, and will cause each of its Subsidiaries to preserve, renew
and keep in full force and effect, its respective corporate existence
and its respective rights, privileges and franchises necessary or
desirable in the normal conduct of business; provided that nothing in
this Section shall prohibit (i) the amalgamation, consolidation or
merger of a Subsidiary with or into another Person, (ii) the
termination of the corporate existence of any Subsidiary if, in the
case of clauses (i) or (ii), such amalgamation, consolidation, merger
or termination is not materially disadvantageous to the Banks acting
reasonably and in good faith; and provided further that nothing in this
Section shall prohibit any sale or other disposition of assets
permitted under Section 5.1(g).
Compliance with Laws. The Borrowers will comply, and cause
each of their Subsidiaries to comply, in all material respects with all
applicable laws, ordinances, rules, regulations, and requirements of
governmental authorities (including, without limitation, Environmental
Laws) except where the necessity of compliance therewith is contested
in good faith by appropriate proceedings or except where the failure to
comply could not reasonably be expected to have a Material Adverse
Effect.
Inspection of Property, Books and Records. The Borrowers
will keep, and will cause each of their Subsidiaries to keep, proper
books of record and account in which full, true and correct entries
shall be made of all dealings and transactions in relation to its
business and activities; and will permit, and will cause each of their
Subsidiaries to permit, representatives of any Bank at such Bank's
expense to visit and inspect any of its respective properties, to
examine and make abstracts from any of its respective books and records
and to discuss its respective affairs, finances and accounts with its
respective officers, employees and independent public accountants, all
at such reasonable times as may be desired.
Mergers and Sales of Assets.
The Borrower will not amalgamate, consolidate
or merge with or into any other Person; unless (x) the
Person with which the Borrower enters into such
transaction is incorporated or organized in Canada and
the surviving or continuing entity is a corporation
which is a direct or indirect wholly-owned Subsidiary of
the Guarantor and which expressly assumes in writing the
obligations of the Borrower hereunder and (y) after
giving effect to such transaction, no Default shall have
occurred and be continuing.
The Borrower will not sell, lease or otherwise
transfer, directly or indirectly, assets (exclusive of
assets transferred or sold in the ordinary course of
business) if after giving effect to such transfer the
aggregate book value of assets so transferred subsequent
to the date of this Agreement would constitute
Substantial Assets as of the day preceding the date of
such transfer other than the sale of assets acquired
pursuant to an Acquisition that are unrelated to the
business of the same general type as now conducted by
the Borrower and its Subsidiaries.
Use of Proceeds. The proceeds of the Advances made under
this Agreement and of the Letters of Credit under this Agreement will
be used by the Borrowers for general corporate purposes, including
without limitation the refinancing of the Existing Credit Agreements
and Acquisitions.
Negative Pledge. Neither of the Borrowers will, nor will
either one of them permit any of its Subsidiaries to, create, assume or
suffer to exist any Lien on any asset now owned or hereafter acquired
by it, except:
Liens existing on the date of this Agreement
securing Debt outstanding on the date of this Agreement
in an aggregate principal or face amount not exceeding
US$15,000,000;
any Lien existing on any asset of any Person
at the time such Person becomes a Subsidiary of the
Borrower and not created in contemplation of such event;
any Lien on any asset securing Debt incurred
or assumed for the purpose of financing all or any part
of the cost of acquiring or constructing such asset,
provided that such Lien attaches to such asset (and no
other asset) concurrently with or within 90 days after
the acquisition or completion of construction thereof;
any Lien on any asset of any Person existing
at the time such Person is amalgamated, merged or
consolidated with or into a Borrower or a Subsidiary of
a Borrower and not created in contemplation of such
event;
any Lien existing on any asset prior to the
acquisition thereof by a Borrower or a Subsidiary of the
Borrower and not created in contemplation of such
acquisition;
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 the proceeds of such Debt
are used solely for the foregoing purpose and to pay
financing costs and such Debt is not secured by any
additional assets;
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 US$10,000,000 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;
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 US$1,000,000; and
Liens not otherwise permitted by the foregoing
clauses of this Section securing Debt in an aggregate
principal or face amount, together with all other Debt
secured by Liens permitted under this Section 5.1(i),
not to exceed, at any time, an amount equal to
US$10,000,000.
Transactions with Affiliates. No Borrower will, nor will it
permit any of its Subsidiaries to, directly or indirectly, pay any
funds to or for the account of, make any investment (whether by
acquisition of stock or indebtedness, by loan, advance, transfer of
property, guarantee or other agreement to pay, purchase or service,
directly or indirectly, any Debt, or otherwise) in, lease, sell,
transfer or otherwise dispose of any assets, tangible or intangible,
to, or participate in, or effect, any transaction with, any Affiliate
except transactions on an arms-length basis on terms at least as
favorable to such Borrower or such Subsidiary as could have been
obtained from a third party who was not an Affiliate.
5.2 Guarantor.
The Guarantor repeats the covenants contained in subsections
5.1(b), (c) and (f) and clauses 5.1(a)(ii), (iii) and (iv), as if
references to "Borrower" therein (as the context so permits) were read
as "Guarantor".
The Guarantor also agrees that, so long as any Bank has any
Commitment hereunder or any amount payable hereunder remains unpaid or
any Bankers' Acceptance Obligations or Letter of Credit Liabilities
remain outstanding:
Information. The Guarantor will deliver to each of the
Banks:
as soon as available and in any event within 95
days after the end of each fiscal year of the
Guarantor, a consolidated balance sheet of the
Guarantor and its Consolidated Subsidiaries as of
the end of such fiscal year and the related
consolidated statements of earnings, cash flows,
and changes in stockholders' equity for such fiscal
year, setting forth in each case in comparative
form the figures for the previous fiscal year, all
reported on in a manner consistent with the
requirements of the Securities and Exchange
Commission and audited by Ernst & Young LLP or
other independent public accountants of nationally
recognized standing;
as soon as available and in any event within 50
days after the end of each of the first three
quarters of each fiscal year of the Guarantor, an
unaudited consolidated balance sheet of the
Guarantor and its Consolidated Subsidiaries as of
the end of such quarter and the related unaudited
consolidated statements of earnings and cash flows
for such quarter and for the portion of the
Guarantor's fiscal year ended at the end of such
quarter, setting forth in each case in comparative
form the figures for the corresponding quarter and
the corresponding portion of the Guarantor's
previous fiscal year, all certified (subject to
normal year-end adjustments) as to fairness of
presentation and preparation based on financial
accounting principles consistent with generally
accepted accounting principles by an Approved
Officer of the Guarantor;
simultaneously with the delivery of each set of
financial statements referred to in clauses (A) and
(B) above, a certificate of an Approved Officer of
the Guarantor (x) setting forth in reasonable
detail the calculations required to establish
whether the Guarantor was in compliance with the
requirements of Subsections 5.2(g) and (i) on the
date of such financial statements and (y) stating
whether any Default exists on the date of such
certificate and, if any Default then exists,
setting forth the details thereof and the action
which the Guarantor is taking or proposes to take
with respect thereto;
simultaneously with the delivery of each set of
financial statements referred to in clause (A)
above, a statement of the firm of independent
public accountants which reported on such
statements (x) that nothing has come to their
attention to cause them to believe that any Default
arising from the Guarantor's failure to comply with
its obligations under Sections 5.2(g) and 5.2(i)
existed on the date of such statements (it being
understood that such accountants shall not thereby
be required to perform any procedures not otherwise
required under generally accepted auditing
standards) and (y) confirming the calculations set
forth in the officer's certificate delivered
simultaneously therewith pursuant to clause C
above;
promptly upon the mailing thereof to the
shareholders of the Guarantor generally, copies of
all financial statements, reports and proxy
statements so mailed;
promptly after 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 (other than the
exhibits thereto) on Forms 10-K, 10-Q and 8-K (or
their equivalents) which the Guarantor shall have
filed with the Securities and Exchange Commission;
and
if and when any member of the ERISA Group (i) gives
or is required to give notice to the PBGC of any
"reportable event" (as defined in Section 4043 of
ERISA) with respect to any Plan which might
constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required
to give notice of any such reportable event, a copy
of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives
notice of complete or partial withdrawal liability
under Title IV of ERISA or notice that any
Multiemployer Plan is in reorganization, is
insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate, impose
liability (other than for premiums under Section
4007 of ERISA) in respect of, or appoint a trustee
to administer any Plan, a copy of such notice; (iv)
applies for a waiver of the minimum funding
standard under Section 412 of the Internal Revenue
Code, a copy of such application; (v) gives notice
of intent to terminate any Plan under Section
4041(c) of ERISA, a copy of such notice and other
information filed with the PBGC; (vi) gives notice
of withdrawal from any Plan pursuant to Section
4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to
any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement or makes any amendment to any
Plan or Benefit Arrangement which has resulted or
could result in the imposition of a Lien or the
posting of a bond or other security, a certificate
of the chief financial officer or the chief
accounting officer of the Guarantor setting forth
details as to such occurrence and action, if any,
which the Guarantor or applicable member of the
ERISA Group is required or proposes to take.
Conduct of Business and Maintenance of Existence. The
Guarantor and its Subsidiaries taken as a whole will continue to engage
in business of the same general type as now conducted by the Guarantor
and its Subsidiaries and any ancillary or related lines of business,
and the Guarantor will preserve, renew and keep in full force and
effect, and will cause each of its Subsidiaries to preserve, renew and
keep in full force and effect, its respective legal existence and its
respective rights, privileges and franchises necessary or desirable in
the normal conduct of business; provided that nothing in this Section
shall prohibit (i) the consolidation or merger of a Subsidiary with or
into another Person if such consolidation, merger or termination is not
materially disadvantageous to the Banks; and provided further that
nothing in this Section shall prohibit any sale or other disposition of
assets permitted under clause 5.2(e)(ii).
Compliance with Laws. The Guarantor will comply, and cause
each of its Subsidiaries to comply, in all material respects with all
applicable laws, ordinances, rules, regulations, and requirements of
governmental authorities (including, without limitation, Environmental
Laws and ERISA and the rules and regulations thereunder) except where
(i) the necessity of compliance therewith is contested in good faith by
appropriate proceedings or (ii) the failure to comply could not
reasonably be expected to have a Material Adverse Effect.
Mergers and Sales of Assets.
The Guarantor will not consolidate or merge
with or into any other Person; provided that the
Guarantor may merge with another Person if (x) the
Guarantor is the corporation surviving such merger and
(y) after giving effect to such merger, no Default shall
have occurred and be continuing.
The Guarantor will not sell, lease or
otherwise transfer, directly or indirectly, assets
(exclusive of assets transferred in the ordinary course
of business) if after giving effect to such transfer the
aggregate book value of assets so transferred subsequent
to the date of this Agreement would constitute
Substantial Assets as of the day preceding the date of
such transfer other than (w) sales of accounts
receivable to IMC-Agrico Receivables Company L.L.C. or
any other similar bankruptcy-remote Subsidiary of the
Guarantor or any of its Subsidiaries established for the
purpose of engaging in transactions related to accounts
receivable, (x) the sale of substantially all of the
assets comprising the IMC Vigoro business unit of the
Guarantor, (y) the sale of any equity interest in
McMoRan Oil & Gas Co., a Delaware corporation, or the
sale or transfer of any right to receive revenues from
the MOXY-FRP Exploration Program undertaken by McMoRan
Oil & Gas Co., a Delaware corporation, and (z) the sale
of assets acquired pursuant to an Acquisition that are
unrelated to the business of the same general type as
now conducted by the Guarantor and its Subsidiaries.
Negative Pledge. The Guarantor will not, nor will it permit
any of its Subsidiaries (provided that for the purposes of this
Subsection 5.2(f) other than clauses (i), (vii) and (ix), the Borrowers
and their respective Subsidiaries shall be deemed not be "Subsidiaries"
of the Guarantor) to create, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired by it, except:
Liens existing on the date of this Agreement
securing Debt outstanding on the date of this Agreement
in an aggregate principal or face amount not exceeding
US$135,000,000;
any Lien existing on any asset of any Person
at the time such Person becomes a Subsidiary of the
Guarantor and not created in contemplation of such
event;
any Lien on any asset securing Debt incurred
or assumed for the purpose of financing all or any part
of the cost of acquiring or constructing such asset,
provided that such Lien attaches to such asset (and no
other asset)
concurrently with or within 90 days after the
acquisition or completion of construction thereof;
any Lien on any asset of any Person existing
at the time such Person is merged or consolidated with
or into a Guarantor or a Subsidiary of a Borrower and
not created in contemplation of such event;
any Lien existing on any asset prior to the
acquisition thereof by a Borrower or a Subsidiary of the
Guarantor and not created in contemplation of such
acquisition;
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 the proceeds of such Debt
are used solely for the foregoing purpose and to pay
financing costs and such Debt is not secured by any
additional assets;
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 US$100,000,000 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;
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 US$10,000,000; and
Liens not otherwise permitted by the foregoing
clauses of this Section securing Debt in an aggregate
principal or face amount, together with all other Debt
secured by Liens permitted under this Section 5.9(f),
not to exceed an amount equal to 10% of Consolidated Net
Worth (calculated as of the last day of the fiscal
quarter most recently ended on or prior to the date of
the most recent incurrence of such Debt).
Debt of Subsidiaries. Total Debt of all Subsidiaries of the
Guarantor (excluding Debt (i) of a Subsidiary owing to the Guarantor,
(ii) of a Subsidiary owing to a Substantially-Owned Consolidated
Subsidiary, (iii) of an "Eligible Subsidiary" as defined in the
Guarantor's Credit Agreements or (iv) of FRP in an aggregate principal
amount not exceeding US$300,000,000 outstanding on the Effective Date
(but not any refinancing thereof)) will not at any date exceed 20% of
Consolidated Net Worth (calculated as of the last day of the fiscal
quarter most recently ended on or prior to such date). For purposes of
this Section any preferred stock of a Consolidated Subsidiary (other
than the Series E Preferred Stock) held by a Person other than the
Guarantor or a Substantially-Owned Consolidated Subsidiary shall be
included, at the higher of its voluntary or involuntary liquidation
value, in the "Debt" of such Consolidated Subsidiary.
Transactions with Affiliates. The Guarantor will not, and
will not permit any of its Subsidiaries to, directly or indirectly, pay
any funds to or for the account of, make any investment (whether by
acquisition of stock or indebtedness, by loan, advance, transfer of
property, guarantee or other agreement to pay, purchase or service,
directly or indirectly, any Debt, or otherwise) in, lease, sell,
transfer or otherwise dispose of any assets, tangible or intangible,
to, or participate in, or effect, any transaction with, any Affiliate
except (i) transactions on an arms-length basis on terms at least as
favorable to the Guarantor or such Subsidiary as could have been
obtained from a third party who was not an Affiliate, (ii) marketing
services provided by IMC Global Operations Inc. to Agrico, (iii)
employee leasing services agreements between IMC Global Operations Inc.
and Agrico, (iv) transactions between Agrico and the Rainbow and
FarMarkets business units of the Guarantor, (v) transactions between
Agrico and the IMC Kalium business unit of the Guarantor, (vi) loans
from the Guarantor or a Subsidiary to the Guarantor or a Subsidiary,
(vii) the declaration and payment of any lawful dividend and (viii)
transactions between Vigiron Partnership, a Delaware general
partnership, and the IMC AgriBusiness business unit of the Guarantor.
Leverage Ratio. The Leverage Ratio of the Guarantor will not
at any date exceed 3.75 to 1.00.
ARTICLE
DEFAULTS
6.1 Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
either of the Borrowers shall fail to pay when due any
principal of any Loan, any Bankers' Acceptance Obligation or any Letter
of Credit Liabilities or shall fail to pay, within five Business Days
of the due date thereof, any interest, fees or any other amount payable
hereunder;
either of the Borrowers shall fail to observe or perform any
covenant contained in subsections 5.1(g) to (j), inclusive;
the Guarantor shall fail to observe or perform any covenant
contained in subsections 5.2(e) to (i);
either of the Borrowers shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than those
covered by clause (a) or (b) above) for 30 days after notice thereof
has been given to such Borrower by the Agent at the request of any
Bank;
the Guarantor shall fail to observe or perform any covenant
or agreement contained in this Agreement (other than those covered by
clause (c) above) for 30 days after notice thereof has been given to
the Guarantor by the Agent at the request of any Bank;
any representation, warranty, certification or statement made
by any Borrower or the Guarantor in this Agreement or in any
certificate, financial statement or other document delivered pursuant
to this Agreement shall prove to have been incorrect in any material
respect when made (or deemed made);
either of the Borrowers or any Subsidiary thereof shall fail
to make any payment in respect of Material Financial Obligations (other
than under this Agreement) when due or within any applicable grace
period applicable to such Material Financial Obligations;
any event or condition shall occur and shall continue beyond
the applicable grace or cure period, if any, provided with respect
thereto and the maturity of Material Financial Obligations shall be
accelerated as a result thereof;
if either of the Borrowers or any Subsidiary of the
Borrower which shall be a Material Subsidiary of the Guarantor shall
generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally as they become due or
shall make a general assignment for the benefit of creditors; or any
proceeding shall be instituted by or against either of the Borrowers or
any such Material Subsidiary of the Guarantor seeking to adjudicate it
a bankrupt or insolvent, or seeking liquidation, dissolution, winding-
up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry
of an order for relief or the appointment of a receiver, trustee or
other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it
(but not instituted by it), either such proceeding shall remain
undismissed or unstayed for a period of 60 days or any of the actions
sought in such proceeding (including, without limitation, the entry of
an order for relief against it or the appointment of a receiver,
trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur; or either of the
Borrowers or any such Material Subsidiary shall take any corporate
action to authorize any of the actions set forth above in this
subsection 6.1(i);
the Guarantor shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official
of it or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing;
an involuntary case or other proceeding shall be commenced
against the Guarantor seeking liquidation, reorganization or other
relief with respect to it or its debts under any bankruptcy, insolvency
or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of 60 days; or an order for relief shall be
entered against the Guarantor under the federal bankruptcy laws as now
or hereafter in effect;
judgments or orders for the payment of money in excess of
US$10,000,000 in the aggregate shall be rendered against either of the
Borrowers or any Subsidiary thereof and such judgments or orders shall
continue unsatisfied and unstayed for a period of 30 days;
either of the Borrowers shall cease to be a direct or
indirect wholly-owned Subsidiary of the Guarantor;
judgments or orders for the payment of money in excess of
US$100,000,000 in the aggregate shall be rendered against the Guarantor
or any Subsidiary thereof (other than the Borrowers or any Subsidiary
of the Borrowers) and such judgments or orders shall continue
unsatisfied and unstayed for a period of 30 days;
any of the obligations of the Guarantor under Article 9 of
this Agreement shall for any reason not be enforceable against the
Guarantor in accordance with their terms, or the Guarantor shall so
assert in writing;
the Guarantor or any Subsidiary thereof (other than the
Borrowers or any Subsidiary of the Borrowers) shall fail to make any
payment in respect of Guarantor's Material Financial Obligations when
due or within any grace period applicable to such Guarantor's Material
Financial Obligations or the Guarantor or any US Borrower shall fail to
make any payment under either of the Guarantor's Credit Agreements when
due or within any applicable grace period provided therein; or
any event or condition shall occur and shall continue beyond
the applicable grace or cure period, if any, provided with respect
thereto and the maturity of the obligations of the Guarantor or any US
Borrower under the Guarantor's Credit Agreements or of Guarantor's
Material Financial Obligations shall be accelerated as a result
thereof;
then, and in every such event, the Agent shall (i) if requested by
Banks having more than 50% in aggregate amount of the Commitments, by
notice to the Borrowers terminate the Commitments and they shall
thereupon terminate or (ii) if requested by Banks holding more than 50%
in aggregate principal amount of the Loans, Bankers' Acceptance
Obligations and Letter of Credit Liabilities in circumstances where the
Commitments have terminated by notice to the Borrowers declare the
Advances and Letter of Credit Liabilities (together with accrued
interest thereon) to be, and the Advances and Letter of Credit
Liabilities shall thereupon become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrowers to the fullest extent permitted by
applicable law; provided that in the case of any of the Events of
Default specified in clause (i), (j) or (k) above, without any notice
to either of the Borrowers or any other act by the Agent or the Banks,
the Commitments shall thereupon terminate and the Advances (together
with accrued interest thereon) and the Letter of Credit Liabilities
shall become immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by
the Borrowers to the fullest extent permitted by applicable law.
6.2 Notice of Default. The Agent shall give notice to a Borrower
or the Guarantor under subsections 6.1(d) and (e) promptly upon being
requested to do so by any Bank and shall thereupon notify all the Banks
thereof.
6.3 Cash Cover. The Borrowers agree, in addition to the
provisions of Section 6.1 hereof, that upon the occurrence and during
the continuance of any Event of Default they shall, if requested by the
Agent upon the instruction of the Banks having more than 50% in the
aggregate amount of the Commitments (or, if the Commitments shall have
been terminated, holding more than 50% of the Bankers' Acceptance
Obligations or Letter of Credit Liabilities, as the case may be) pay to
the Agent and shall execute in respect thereof any security documents
reasonably required by the Agent an amount in immediately available
funds (which funds shall be held as collateral in an interest bearing
cash collateral account pursuant to arrangements satisfactory to the
Agent), to be applied to such obligations or liabilities on the
maturity thereof, equal to the aggregate Face Amount of all Bankers'
Acceptances then outstanding and/or the aggregate amount available for
drawing under all Letters of Credit then outstanding at such time,
provided that, upon the occurrence of any Event of Default specified in
subsections 6.1(i), (j) or (k) with respect to either Borrower or the
Guarantor, the Borrowers shall pay such amount forthwith without any
notice or demand or any other act by the Agent or the Banks.
ARTICLE
THE AGENT
7.1 Appointment and Authorization. Each Bank irrevocably
appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are
delegated to the Agent by the terms hereof or thereof, together with
all such powers as are reasonably incidental thereto.
7.2 Agent and Affiliates. Royal Bank of Canada shall have the
same rights and powers under this Agreement as any other Bank and may
exercise or refrain from exercising the same as though it were not the
Agent, and Royal Bank of Canada and its affiliates may accept deposits
from, lend money to, and generally engage in any kind of business with
the Borrowers, the Guarantor or any Subsidiary or affiliate of the
Borrowers or the Guarantor as if it were not the Agent hereunder.
7.3 Action by Agent. The obligations of the Agent hereunder are
only those expressly set forth herein. Without limiting the generality
of the foregoing, the Agent shall not be required to take any action
with respect to any Default, except as expressly provided in Article 6.
7.4 Consultation with Experts. The Agent may consult with legal
counsel (who may be counsel for either of the Borrowers), independent
public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken by it in good faith
in accordance with the advice of such counsel, accountants or experts.
7.5 Liability of Agent. Neither the Agent nor any of its
affiliates nor any of their respective directors, officers, agents or
employees shall be liable to any Bank for any action taken or not taken
by it in connection herewith (i) with the consent or at the request of
the Required Banks (or, when expressly required hereby, all the Banks)
or (ii) in the absence of its own gross negligence or willful
misconduct. Neither the 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
this Agreement or any extension of credit hereunder; (ii) the
performance or observance of any of the covenants or agreements of any
Borrower; (iii) the satisfaction of any condition specified in Article
3, except receipt of items required to be delivered to the Agent; or
(iv) the validity, effectiveness or genuineness of this Agreement or
any other instrument or writing furnished in connection herewith. The
Agent shall not incur any liability by acting in reliance upon any
notice, consent, certificate, statement, or other writing (which may be
a bank wire, telex or similar writing) believed by it in good faith to
be genuine or to be signed by the proper party or parties. Without
limiting the generality of the foregoing, the use of the term "agent"
in this Agreement with reference to the Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising
under agency doctrine of any applicable law. Instead, such term is
used merely as a matter of market custom and is intended to create or
reflect only an administrative relationship between independent
contracting parties.
7.6 Indemnification. Each Bank shall, ratably in accordance with
its Commitment, or if the Commitments have terminated, in accordance
with its Commitment immediately preceding such termination, indemnify
the Agent, its affiliates and their respective directors, officers,
agents and employees (to the extent not reimbursed by the Borrowers or
the Guarantor) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such
as result from such indemnitees' gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection
with this Agreement or any action taken or omitted by such indemnitees
thereunder.
7.7 Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank,
and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Bank also acknowledges that it will,
independently and without reliance upon the Agent or any other Bank,
and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking any action under this Agreement.
7.8 Successor Agent. The Agent may resign at any time by giving
notice thereof to the Banks and the Borrowers. Upon any such
resignation, the Borrowers, with the consent of the Required Banks
(such consent not to be unreasonably withheld or delayed), shall have
the right to appoint a successor Agent. If no successor Agent shall
have been so appointed, and shall have accepted such appointment,
within 30 days after the retiring Agent gives notice of resignation,
then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be a Bank. Upon the acceptance of its
appointment as Agent hereunder by a successor Agent, such successor
Agent shall thereupon succeed to and become vested with all the rights
and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this
Article shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Agent.
7.9 Agent's Fees. The Borrowers shall pay the Agent for its own
account fees in the amounts and at the times previously agreed upon
between the Borrowers and the Agent.
7.10 Other Agents. Nothing in the Agreement shall impose upon any
Co-Agent in such capacity any duties or obligations whatsoever.
ARTICLE
CHANGE IN CIRCUMSTANCES
8.1 Basis for Determining Interest Rate Inadequate or Unfair. If
on or prior to the first day of any Interest Period for any Euro-Dollar
Borrowing, Banks having more than 50% of the aggregate amount of the
Euro-Dollar Loans requested by the Borrowers advise the Agent that the
LIBOR Rate as determined by the Agent will not adequately and fairly
reflect the cost to such Banks of funding their Euro-Dollar Loans for
such Interest Period, the Agent shall forthwith give notice thereof to
the Borrowers and the Banks, whereupon until the Agent notifies the
applicable Borrower or Borrowers that the circumstances giving rise to
such suspension no longer exist, (i) the obligations of the Banks to
make such Euro-Dollar Loans or to continue or convert outstanding Loans
as or into such Euro-Dollar Loans shall be suspended and (ii) each
outstanding Euro-Dollar Loan shall be converted into a USBR Loan on the
last day of the then current Interest Period applicable thereto.
Unless the Applicable Borrower or Borrowers notifies the Agent at least
three Business Days before the date of any Euro-Dollar Borrowing for
which a Notice of Borrowing has previously been given that it elects
not to borrow on such date such Borrowing shall instead be made as a
USBR Borrowing.
8.2 Illegality. If, on or after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in
any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any Governmental Authority,
court, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank
with any request or directive (whether or not having the force of law)
of any such authority, court, central bank or comparable agency shall
make it unlawful or impossible for any Bank to make, maintain or fund
any of its Advances (in this section a "Prohibited Advance") or
maintain or issue Letters of Credit (in this section a "Prohibited
Letter of Credit") and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and such
Borrower, whereupon until such Bank notifies such Borrower and the
Agent that the circumstances giving rise to such suspension no longer
exist, the obligation of such Bank to make Prohibited Advances or to
continue to issue Prohibited Letters of Credit, or to continue or
convert outstanding Prohibited Advances, to or of the Borrowers shall
be suspended. Before giving any notice to the Agent pursuant to this
Section, such Bank (if requested by and consented to by the Borrowers)
shall designate a different Applicable Lending Office if such
designation will avoid the need for giving such notice and will not be
otherwise disadvantageous to such Bank in the good faith exercise of
its discretion. If such notice is given:
in respect of any Euro-Dollar Loan which is a
Prohibited Advance such Euro-Dollar Loan shall be
converted to a USBR Loan (unless USBR Loans are also
Prohibited Advances, in which case such Euro-Dollar Loan
shall be prepaid) either (x) on the last day of the then
current Interest Period applicable to such Euro-Dollar
Loan if such Bank may lawfully continue to maintain and
fund such Euro-Dollar Loan to such day or (y)
immediately if such Bank shall determine that it may not
lawfully continue to maintain and fund such Euro-Dollar
Loan to such day;
in respect of any USBR Loan or Prime Rate Loan
which is a Prohibited Advance, such Loan shall be
prepaid immediately;
with respect to any Bankers' Acceptance which
is a Prohibited Advance or any Letter of Credit which is
a Prohibited Letter of Credit, the applicable Borrower
shall forthwith pay to the Agent an amount in
immediately available funds equal to the Face Amount of
the applicable Bankers' Acceptance or the Letter of
Credit Liabilities of the applicable Letter of Credit
(to be held as collateral in an interest bearing account
pursuant to arrangements satisfactory to the Agent) to
be applied against the liability of the Borrower in
respect of such Bankers' Acceptance or Letter of Credit
as provided herein and in connection therewith, the
Borrower shall further execute and deliver such security
documents as the Agent may reasonably require.
8.3 Increased Costs. In the event of the adoption of any
applicable law, rule or regulation, or any change in any applicable
law, rule or regulation, or any change in the interpretation or
administration thereof by any Governmental Authority, court, central
bank or comparable agency charged with the interpretation or
administration thereof (each such event being hereinafter referred to
as a "change in law") which now or hereafter:
subjects a Bank to any tax or changes the basis of taxation,
or increases any existing tax (in each case, except for the coming into
force of any tax or change in the basis of taxation in respect of or
the change in the rate of tax charged on income or capital of any Bank
as a whole), on payments of principal, interest or other amounts
payable by a Borrower to such Bank hereunder on or by reference to the
amount of any Advances made or to be made by or Letter of Credit
Liabilities of any Bank hereunder or on or by reference to the
Commitment of any Bank, or
imposes, modifies or deems applicable any reserve, special
deposit or similar requirements or otherwise imposes any cost on any
Bank in funding or maintaining all or any of the Advances, Letter of
Credit Liabilities or its Commitment, or
will have the effect of increasing the amount of overall
capital required to be maintained by a Bank, taking into account the
existence of such Bank's participation in any Advance, Letter of Credit
Liabilities or any of its obligations hereunder (including, without
limitation, all or any part of its Commitment), and the result of any
of the foregoing is to increase the cost to a Bank, reduce the income
receivable by it or reduce the effective return on the capital of such
Bank in respect of any Advances, Letter of Credit Liabilities and/or
its Commitment to an extent which such Bank believes to be material
(after consultation with the relevant Borrower), as soon as reasonably
practicable after the Bank shall become aware of an event entitling it
to Additional Compensation, the Bank shall give notice thereof to the
Agent and the Agent shall give notice thereof to the Borrowers (herein
called a "Notice of Amount") stating the event by reason of which it
believes it is entitled to Additional Compensation, such cost and/or
such reduction in such return (or such proportion of such reduction as
is, in the reasonable and bona fide opinion of such Bank, attributable
to its obligations hereunder) the amount of such Additional
Compensation (as hereinafter defined) incurred by such Bank and
supplying reasonable supporting evidence (including, in the event of
change in law, a photocopy of the applicable law evidencing such change
together with a certificate of a duly authorized officer of the Bank
setting forth the Additional Compensation and the basis of calculation
of such Additional Compensation and where the change in law had
retroactive application, a statement to such effect), provided that the
Bank shall not be required to disclose any information required to be
kept confidential by applicable law, and provided further that such
Bank will (if requested and consented to by the Borrowers) designate
another Applicable Lending Office if such designation will avoid the
need for Additional Compensation and will not be otherwise
disadvantageous to such Bank in good faith exercise of its discretion.
In the event the Bank subsequently recovers all or part of the
Additional Compensation paid by the Borrower, it shall repay an equal
amount to the Borrower. The Borrower shall pay to the Bank, within 10
Business Days of the date of receipt of any Notice of Amount, that
amount (in this Section 8.3 referred to as "Additional Compensation").
Notwithstanding the foregoing, the Borrower shall not be obligated to
pay Additional Compensation arising or accruing during any time or
period commencing more than 45 days prior to the date on which the Bank
notifies the Agent that it proposes to demand Additional Compensation
except for Additional Compensation arising or accruing as a result of
the retroactive application of a change in law in which event the
Borrower will be obligated to pay additional compensation for the whole
period in respect of which such change of law shall be applicable.
8.4 Taxes.
For the purposes of this Section 8.4, the following terms
have the following meanings:
"Other Taxes" means any present or future stamp or
documentary taxes and any other excise or property taxes, or
similar charges or levies, which arise from any payment made
pursuant to this Agreement or from the execution or delivery
of, or otherwise with respect to, this Agreement.
"Taxes" means any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings with
respect to any payment by any Borrower pursuant to this
Agreement, and all liabilities with respect thereto,
excluding (i) in the case of each Bank and the Agent, taxes
imposed on its income or capital as a whole imposed on it by
a jurisdiction under the laws of which such Bank or the Agent
(as the case may be) is organized or in which its principal
executive office is located or, in the case of each Bank, in
which its Applicable Lending Office is located (all such
excluded taxes of the Agent or any Bank being herein referred
to as its "Domestic Taxes").
Any and all payments by any Borrower to or for the account of
any Bank or the Agent hereunder shall be made without deduction for any
Taxes or Other Taxes; provided that, if any Borrower shall be required
by law to deduct any Taxes or Other Taxes from any such payments,
(i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to
additional sums payable under this Section 8.4) such Bank or the Agent
(as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) such Borrower shall
make such deductions, (iii) such Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in
accordance with applicable law and (iv) such Borrower shall furnish to
the Agent, at its address referred to in Section 10.1 the original or a
certified copy of a receipt evidencing payment thereof.
Each Borrower agrees to indemnify each Bank and the Agent for
the full amount of Taxes or Other Taxes (including, without limitation,
any Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section 8.4) paid by such Bank or the Agent
(as the case may be) and any liability (including penalties, interest
and expenses) arising therefrom or with respect thereto. This
indemnification shall be paid within 15 days after such Bank or the
Agent (as the case may be) makes demand therefor.
If any Borrower is required to pay additional amounts to or
for the account of any Bank pursuant to this Section 8.4, then such
Bank will take such action (including, at the request of and with the
consent of the Borrowers, changing the jurisdiction of its Applicable
Lending Office) as in the good faith judgment of such Bank (i) will
eliminate or reduce any such additional payment which may thereafter
accrue and (ii) is not otherwise disadvantageous to such Bank.
8.5 No Market for Bankers' Acceptance. If the Agent determines
in good faith and notifies the Borrowers in writing that by reason of
circumstances affecting the Canadian money market (after having
discussed said circumstances with the Borrowers) there is no market for
Bankers' Acceptances, then the right of the Borrowers to request the
Bankers' Acceptance Advances shall be suspended until the Agent, acting
reasonably, determines that circumstances causing such suspension no
longer exist and the Agent so notifies the Borrowers and any Notice of
Borrowing with respect to a Bankers' Acceptance Advance which is
outstanding shall be cancelled and the Advance requested therein shall,
at the option of the Borrower, either not be made or be made as a Prime
Rate Loan.
8.6 USBR Loans Substituted for Affected Euro-Dollar Loans. If
(i) the obligation of any Bank to make or to continue or convert
outstanding Loans as or into Euro-Dollar Loans to any Borrower has been
suspended pursuant to Section 8.2 or (ii) any Bank has demanded
compensation under Section 8.3 or 8.4 with respect to its Euro-Dollar
Loans and the Borrower shall, by at least five Business Days' prior
notice to such Bank through the Agent, have elected that the provisions
of this Section shall apply to such Bank, then, unless and until such
Bank notifies the Borrower that the circumstances giving rise to such
suspension or demand for compensation no longer apply:
all Loans to such Borrower which would otherwise be made by
such Bank as (or continued as or converted to) Euro-Dollar Loans, as
the case may be, shall instead be USBR Loans (on which interest and
principal shall be payable contemporaneously with the related Euro-
Dollar Loans of the other Banks), and
after each of its Euro-Dollar Loans to such Borrower has been
repaid, all payments of principal which would otherwise be applied to
repay such Loans shall be applied to repay its USBR Loans instead.
If such Bank notifies such Borrower that the circumstances giving rise
to such suspension or demand for compensation no longer exist, the
principal amount of each such USBR Loan shall be converted into a Euro-
Dollar Loan on the first day of the next succeeding Interest Period
applicable to the related Euro-Dollar Loans of the other Banks.
8.7 Substitution of Bank. If the obligation of any Bank to make
or to convert or continue outstanding Loans as or into Euro-Dollar
Loans has been suspended pursuant to Section 8.2 or any Bank has
demanded compensation under Section 8.3 or 8.4, the Borrower shall have
the right, with the assistance of the Agent, to designate a substitute
bank or banks (which may be one or more of the Banks) mutually
satisfactory to the Borrower, the Agent, the Issuing Banks and the
Swingline Bank (whose consent shall not be unreasonably withheld or
delayed) to purchase for cash, pursuant to an Assignment and Assumption
Agreement in substantially the form of Exhibit D hereto, the
outstanding Loans of such Bank and assume the Commitment, Bankers'
Acceptance Obligations and Letter of Credit Liabilities of such Bank,
without recourse to or warranty by, or expense to, such Bank, for a
purchase price equal to the principal amount of all of such Bank's
outstanding Loans, Bankers' Acceptance Obligations and funded Letter of
Credit Liabilities plus any accrued but unpaid interest thereon and the
accrued but unpaid fees in respect of such Bank's Commitment hereunder
plus such amount, if any, as would be payable pursuant to Section 2.11
if the outstanding Loans of such Bank were prepaid in their entirety on
the date of consummation of such assignment.
ARTICLE
GUARANTEE
9.1 The Guarantee. The Guarantor hereby unconditionally
guarantees the full and punctual payment (whether at stated maturity,
upon acceleration or otherwise) of the principal of and interest on
each Loan made to and all Bankers' Acceptance Obligations and Letter of
Credit Liabilities incurred at the request of any Borrower pursuant to
this Agreement, and the full and punctual payment of all other amounts
payable by any Borrower under this Agreement. Upon failure by any
Borrower to pay punctually any such amount, the Guarantor shall
forthwith on demand pay the amount not so paid at the place and in the
manner specified in this Agreement.
9.2 Guarantee Unconditional. The obligations of the Guarantor
hereunder shall be continuing, unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:
any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of any Borrower under this
Agreement, by operation of law or otherwise;
any modification or amendment of or supplement to this
Agreement, including, without limitation, any increase or decrease in
the amounts payable hereunder or thereunder;
any release, impairment, non-perfection or invalidity of any
direct or indirect security for any obligation of any Borrower under
this Agreement;
any change in the existence, structure, name, powers,
business, control or ownership of any Borrower, or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting any
Borrower or its assets or any resulting release or discharge of any
obligation of any Borrower contained in this Agreement;
the existence of any claim, set-off or other rights which the
Guarantor may have at any time against any Borrower, any Agent, any
Bank 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;
any invalidity or unenforceability relating to or against any
Borrower for any reason of this Agreement, or any provision of
applicable law or regulation purporting to prohibit the payment by any
Borrower of the principal of or interest on any Loan, Bankers'
Acceptance Obligation, Letter of Credit Liability or any other amount
payable by it under this Agreement; or
any other act or omission to act or delay of any kind by any
Borrower, any Agent or Bank 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 defence to
the Guarantor's obligations hereunder.
9.3 Discharge Only Upon Payment In Full; Reinstatement In Certain
Circumstances. The Guarantor's obligations hereunder shall remain in
full force and effect until the Commitments and any Bankers'
Acceptances have matured and any Letters of Credit shall have
terminated and the principal of and interest on the Loans, Bankers'
Acceptance Obligations, Letter of Credit Liabilities and all other
amounts payable by the Guarantor and each Borrower under this Agreement
(including without limitation, under Section 10.4) shall have been paid
in full. If at any time any payment of principal of or interest on any
Loan, Bankers' Acceptance Obligation, Letter of Credit Liability or any
other amount payable by any Borrower under this Agreement is rescinded
or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of any Borrower or otherwise, the
Guarantor'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.
9.4 Waiver by the Guarantor. The Guarantor irrevocably waives to
the fullest extent permitted by applicable law 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 Borrower or any other Person.
9.5 Subrogation. The Guarantor irrevocably waives to the fullest
extent permitted by applicable law any and all rights to which it may
be entitled, by operation of law or otherwise, upon making any payment
hereunder to the Agent or any of the Banks in respect of any Borrower
to be subrogated to the rights of the payee against either of the
Borrowers with respect to such payment or against any direct or
indirect security therefor, or otherwise to be reimbursed, indemnified
or exonerated by or for the account of such Borrower in respect
thereof, in any bankruptcy, insolvency or similar proceeding involving
such Borrower as debtor until all indebtedness hereunder owing to the
Banks is paid in full.
9.6 Stay of Acceleration. In the event that acceleration of the
time for payment of any amount payable by any Borrower under this
Agreement is stayed upon insolvency, bankruptcy or reorganization of
such Borrower, all such amounts otherwise subject to acceleration under
the terms of this Agreement shall nonetheless be payable by the
Guarantor hereunder forthwith on demand by the Agent made at the
request of the Required Banks.
9.7 Foreign Currency Obligations. The Guarantor shall make
payment relative to each amount owed under this Agreement in the
currency (the "Original Currency") in which the Borrower is required to
pay such amount. If the Guarantor makes payment relative to any amount
owed under this Agreement in a currency (the "Other Currency") other
than the Original Currency (whether voluntarily or pursuant to an order
or judgment of a court or tribunal of any jurisdiction), such payment
shall constitute a discharge of the liability of the Guarantor
hereunder in respect of such Obligation only to the extent of the
Equivalent Amount in the Original Currency. If the Equivalent Amount
of the Original Currency paid by the Guarantor is less than the amount
of the Original Currency due to it in respect to the relevant amount,
the Guarantor shall indemnify and save the Banks harmless from and
against any loss or damage arising as a result of such deficiency.
This indemnity shall constitute an obligation separate and independent
from the other obligations contained in this Agreement, shall give rise
to a separate and independent cause of action, shall apply irrespective
of any indulgence granted by the Banks and shall continue in full force
and effect notwithstanding any judgment or order in respect of any
amount due hereunder or under any judgment or order.
ARTICLE
MISCELLANEOUS
10.1 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, facsimile
transmission or similar writing) and shall be given to such party at
its address or facsimile number set forth in Schedule II or, in the
case of any party, such other address or facsimile number as such party
may hereafter specify for the purpose by notice to the Agent, the
Borrowers and the Guarantor. Each such notice, request or other
communication shall be effective if given by facsimile transmission,
when transmitted to the facsimile number specified in this Section and
confirmation of receipt is received, if given by mail, 72 hours after
such communication is deposited in the mail with first class postage
prepaid, addressed as aforesaid or if delivered, when delivered at the
address specified in this Section; provided that notices to the Agent
under Article 2 or Article 8 shall not be effective until received.
10.2 Reliance on Verbal Instructions. The Agent and any Bank
shall be entitled to act upon the verbal instructions of any Person
whom the Agent or the Bank, has been advised in writing by the Borrower
is a Person authorized by the Borrower to act on the Borrower's behalf,
provided that neither the Agent nor any Bank shall be entitled to act
upon the verbal instructions of any Person, where this Agreement
expressly requires that written advice, instruction or notice be given.
Neither the Agent nor the Bank shall be responsible for any error or
omission in those instructions or in the performance thereof except in
the case of gross negligence or wilful misconduct by the Agent, the
Bank or their respective employees. Any instructions so given shall be
confirmed in writing by the Borrower to the Agent or the Bank, as
applicable, on the same day. The Borrower shall indemnify the Agent
and each Bank for any loss or expense suffered or incurred by the Agent
or the Bank as a consequence of the Agent or the Bank acting upon
instructions given or agreements made over the telephone or by
electronic transmission of any type with Persons reasonably believed by
the Agent or the Bank to have been acting on the Borrower's behalf.
10.3 No Waivers. No failure or delay by the Agent or any Bank in
exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
10.4 Expenses; Indemnification.
The Borrowers shall each pay one-half of all reasonable
out-of-pocket expenses of the Agent, including reasonable fees and
disbursements of special counsel for the Agent, in connection with the
negotiation, preparation, execution and delivery of this Agreement and
any other document to be delivered hereunder, the syndication of the
Commitments, any waiver or consent hereunder or any amendment hereof or
any Default or alleged Default hereunder and if an Event of Default
occurs, all reasonable out-of-pocket expenses incurred by the Agent or
any Bank, including (without duplication) the reasonable fees and
disbursements of outside counsel and allocated cost of inside counsel,
in connection with such Event of Default and collection, bankruptcy,
insolvency and other enforcement proceedings resulting therefrom.
The Borrowers agree to indemnify the Agent and each Bank,
their respective affiliates and the respective directors, officers,
agents and employees of the foregoing (each an "Indemnitee") and hold
each Indemnitee harmless from and against any and all liabilities,
losses, damages, penalties, costs and out-of-pocket expenses of any
kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in
connection with any litigation or governmental or regulatory
investigation or other similar proceeding (whether or not such
Indemnitee shall be designated a party thereto), relating to or arising
out of this Agreement or any actual or proposed use of proceeds of
Advances or Letters of Credit hereunder; provided that no Indemnitee
shall have the right to be indemnified hereunder for such Indemnitee's
own gross negligence or willful misconduct or for its breach of its
express obligations under this Agreement, in each case as determined by
a court of competent jurisdiction; provided, further, that in no event
shall the Borrowers have any such indemnification obligation in respect
of any liabilities, losses, damages, costs or expenses resulting from
disputes between any Bank and any Agent or among the Banks.
The obligations of each party hereto in this Section 10.4
shall survive the termination of this Agreement and the payment of all
amounts owing hereunder.
10.5 Set-off, Etc. Upon the occurrence of an Event of Default,
the Agent, each Bank and each of their respective branches and offices
are hereby authorized by the Borrowers from time to time, without
notice to: set-off and apply any and all amounts owing by the Agent or
any Bank or any of its branches or offices to the Borrowers (whether
payable in C$ or US$ and amounts in C$ and US$ shall be converted to
the Equivalent Amount in US$ and Equivalent Amount in C$ thereof, as
required) against and on account of all amounts owed hereunder; hold
any amounts owing by the Agent or any Bank as collateral to secure the
payment of amounts owed hereunder to the extent that those amounts may
be required to satisfy any contingent or unmatured Obligations
hereunder; and return as unpaid for insufficient funds any and all
cheques and other items drawn against any deposits so held as the Agent
or any Bank in its sole discretion may elect. Each Borrower agrees, to
the fullest extent it may effectively do so under applicable law, that
any holder of a participation in a Loan, Bankers' Acceptance or Letter
of Credit, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of
a participation were a direct creditor of such Borrower in the amount
of such participation.
10.6 Sharing of Set-offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount then due with respect
to the Loans, Bankers' Acceptance Obligations and Letter of Credit
Liabilities held by it which is greater than the proportion received by
any other Bank in respect of the aggregate amount then due with respect
to the Loans, Bankers' Acceptance Obligations and Letter of Credit
Liabilities held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in
the Loans, Bankers' Acceptance Obligations and Letter of Credit
Liabilities held by the other Banks, and such other adjustments shall
be made, as may be required so that all such payments with respect to
the Loans, Bankers' Acceptance Obligations and Letter of Credit
Liabilities held by the Banks shall be shared by the Banks pro rata;
provided that nothing in this Section shall impair the right of any
Bank to exercise any right of set-off or counterclaim it may have and
to apply the amount subject to such exercise to the payment of
indebtedness of the Borrowers other than their indebtedness under this
Agreement.
10.7 Foreign Currency Judgments.
If, for the purpose of obtaining judgment in any court, it is
necessary to convert a sum due hereunder in one currency into another
currency, each party hereto agrees, to the fullest extent that it may
effectively do so, that the rate of exchange used shall be that at
which, in accordance with normal banking procedures in the relevant
jurisdiction of the relevant Bank (or agent acting on its behalf) or
the Agent, as the case may be, could purchase the first currency with
such other currency for the first currency on the Business Day
immediately preceding the day on which final judgment is given.
The obligations of the Borrowers or the Guarantor in respect
of any sum due hereunder shall notwithstanding any judgment in a
currency (the "Judgment Currency") other than that in which such sum is
denominated in accordance with this Agreement (the "Agreement
Currency"), be discharged only to the extent that, on the Business Day
following receipt by any Bank (or agent acting on its behalf) (the
"Applicable Creditor") of any sum adjudged to be so due in the Judgment
Currency, the Applicable Creditor may in accordance with normal banking
procedures in the relevant jurisdiction purchase the Agreement Currency
with the Judgment Currency; if the amount of the Agreement Currency so
purchased is less than the sum originally due to the Applicable
Creditor in the Agreement Currency, the Borrower or the Guarantor, as
the case may be, agrees, as a separate obligation and notwithstanding
any such judgment, to indemnify the Applicable Creditor against such
loss. The obligations of each party hereto contained in this Section
10.7(b) shall survive the termination of this Agreement and the payment
of all amounts owing hereunder.
10.8 Amendments and Waivers. Any provision of this Agreement may
be amended or waived if, but only if, such amendment or waiver is in
writing and is signed by the Borrower and the Required Banks (and, if
the rights or duties of the Agent, any Swingline Bank or any Issuing
Bank are affected thereby, by such Person); provided that no such
amendment or waiver shall, unless signed by all the Banks, (i) increase
or decrease the Commitment of any Bank (except for a ratable decrease
in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) increase or reduce the principal of or rate of
interest on any Loan or the amount to be reimbursed in respect of any
Bankers' Acceptance or Letter of Credit or any interest thereon or any
fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or for reimbursement in respect of
any Bankers' Acceptance or Letter of Credit or interest thereon or any
fees hereunder or for termination of any Commitment, (iv) make any
changes to Article 9 or (v) change the percentage of the Commitments or
of the aggregate unpaid principal amount of the Loans, Bankers'
Acceptance Obligations and Letter of Credit Liabilities, or the number
of Banks, which shall be required for the Banks or any of them to take
any action under this Section or any other provision of this Agreement;
10.9 Successors and Assigns.
The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and assigns, except that no Borrower or the Guarantor may
assign or otherwise transfer any of its rights or obligations under
this Agreement without the prior written consent of all Banks.
Any Bank may at any time, with the consent of the Agent
(which shall not be unreasonably withheld), provided that no such
consent shall be required after Default, grant to one or more banks or
other institutions (each a "Participant") participating interests in
its Commitment or any or all of its Advances and Letter of Credit
Liabilities. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to
the Agent, such Bank shall remain responsible for the performance of
its obligations hereunder, and the Borrowers, the Issuing Banks, the
Swingline Banks and the Agent shall continue to deal solely and
directly with such Bank in connection with such Bank's rights and
obligations under this Agreement. Any agreement pursuant to which any
Bank may grant such a participating interest shall provide that such
Bank shall retain the sole right and responsibility to enforce the
obligations of the Borrowers hereunder including, without limitation,
the right to approve any amendment, modification or waiver of any
provision of this Agreement; provided that such participation agreement
may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause (i), (ii),
(iii) or (iv) of Section 10.8 without the consent of the Participant.
The Borrowers agree that each Participant shall, to the extent provided
in its participation agreement, be entitled to the benefits of
Article 8 with respect to its participating interest, subject to
subsection 10.8(d) below. An assignment or other transfer which is not
permitted by subsection (c) below shall be given effect for purposes of
this Agreement only to the extent of a participating interest granted
in accordance with this subsection (b).
Any Bank may at any time, assign to one or more banks or
other financial institutions (each an "Assignee") all, or a
proportionate part (equivalent to an initial Commitment of not less
than US$10,000,000) of all, of its rights and obligations under this
Agreement, and such Assignee shall assume such rights and obligations,
pursuant to an Assignment and Assumption Agreement in substantially the
form of Exhibit D hereto executed by such Assignee and such transferor
Bank; provided that any such assignment (other than on an assignment
made after a Default or to an affiliate of the transferor Bank or to an
assignee which was a Bank immediately prior to such assignment) shall
be made with the consent of the Borrower (which shall not be
unreasonably withheld), provided that, in the case of such
proportionate assignment, after giving effect thereto the transferor
Bank shall have a Commitment and Borrowings aggregating a minimum of
US$10,000,000. Upon execution and delivery of such instrument of
assumption and payment by such Assignee to such transferor Bank of an
amount equal to the purchase price agreed between such transferor Bank
and such Assignee, such Assignee shall (if not already a Bank) be a
Bank party to this Agreement and shall have all the rights and
obligations of a Bank with a Commitment as set forth in such instrument
of assumption (in addition to any Commitment heretofore held it), and
the transferor Bank shall be released from its obligations hereunder to
a corresponding extent, and no further consent or action by any party
shall be required. All assignments shall be subject to a transaction
fee established by, and payable by the transferor Bank to, the Agent
for its own account of US$2,000.
No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section
8.3 or 8.4 than such Bank would have been entitled to receive (on the
basis that such Bank was not a non-resident for the purposes of the
Income Tax Act (Canada)) with respect to the rights transferred, unless
the applicable assignment participation or other transfer is made (i)
during the continuation of an Event of Default, (ii) by reason of the
provisions of Section 8.2, 8.3 or 8.4 requiring such Bank to designate
a different Applicable Lending Office under certain circumstances or
(iii) at a time when the circumstances giving rise to such greater
payment did not exist.
10.10 Confidentiality. The Agent and each Bank agrees to keep any
information delivered or made available by the Borrowers or the
Guarantor pursuant to this Agreement confidential from anyone other
than persons employed or retained by the Agent or such Bank and its
affiliates who are engaged in evaluating, approving, structuring or
administering the credit facility contemplated hereby; provided that
nothing herein shall prevent the Agent or any Bank from disclosing such
information to any other Bank or to the Agent, or to any other Person
if reasonably incidental to the administration of the credit facility
contemplated hereby, upon the order of any court or administrative
agency, upon the request or demand of any regulatory agency or
authority, which had been publicly disclosed other than as a result of
a disclosure by the Agent or such Bank prohibited by this Agreement, in
connection with any litigation to which the Agent, any Bank or its
subsidiaries or Parent may be a party, to the extent necessary in
connection with the exercise of any remedy hereunder, to such Bank's or
Agent's legal counsel and independent auditors and subject to
provisions substantially similar to those contained in this Section
10.10, to any actual or proposed Participant or Assignee.
10.11 Further Assurances. Each of the Borrowers and the Guarantor
agrees that at any time and from time to time upon the written request
of the Agent, (or upon the request and at the expense of a Bank
assigning its interest pursuant to subsection 10.9(c) with respect to
such an assignment) execute and deliver and do such further acts and
things as are reasonably requested in order to effect the purpose of
this Agreement and carry out its provisions.
10.12 Governing Law; Submission to Jurisdiction. This Agreement
shall be construed in accordance with and governed by the law of the
province of Ontario and the federal laws of Canada applicable therein.
Each of the Borrowers and the Guarantor hereby submits to the
nonexclusive jurisdiction of the courts of Ontario and Saskatchewan for
purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each Borrower and
the Guarantor irrevocably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of
the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum.
10.13 Counterparts; Integration. This Agreement (including the
Schedules hereto) may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement
constitutes the entire agreement and understanding among the parties
hereto and supersedes any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof excluding any
separate agreements as to fees referred to in Section 7.9.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers
as of the day and year first above written.
INTERNATIONAL MINERALS &
CHEMICAL (CANADA) GLOBAL
LIMITED
by_______________________________
Name:
Title:
IMC KALIUM CANADA LTD.
by_______________________________
Name:
Title:
IMC GLOBAL INC.
by
_______________________________
Name:
Title:
ROYAL BANK OF CANADA,
as Agent
by _______________________________
Name:
Title:
Commitments
US$46,750,000 ROYAL BANK OF CANADA,
as Bank
by _______________________________
Name:
Title:
US$21,750,000 BANK OF MONTREAL,
as Bank and Co-Agent
by _______________________________
Name:
Title:
XXx0,000,000 XXXXX XXXXXXX XXX XXXX, XXXXXX
by_______________________________
Name:
Title:
US$21,750,000 X.X. XXXXXX CANADA,
as Bank and Co-Agent
by_______________________________
Name:
Title:
__________________
Total Commitments
$100,000,000
PRICING SCHEDULE
The interest rate bases, LIBOR Margin, Stamping Fee and Facility Fee
(each expressed in basis points per annum) for any day are the
respective percentages set forth below in the applicable row under the
column corresponding to the Status of the Guarantor that exists on such
day, provided that Level II Status shall be deemed to exist on any day
prior to the Conversion Date.
Xxxxxx Xxxxx Xxxxx XX Xxxxx Xxxxx Xxxxx
X III IV V
Libor Margin &
Stamping Fee 15.5 19.0 bp 21.5 bp 27.5 42.5
bp bp bp
Facility Fee Rate 7.0 8.5 bp 11.0 xx 00.0 00.0
xx xx xx
Xxxxxx over Prime
Rate/ 0.0 0.0 bp 0.0 bp 0.0 0.0
US Base Rate bp bp bp
For the purposes of this Schedule, the following terms have the
following meanings:
"Level I Status" exists at any date if, at such date, the Guarantor's
long-term debt is rated A - or higher by S&P or A3 or higher by
Xxxxx'x.
"Level II Status" exists at any date if, at such date, (i) the
Guarantor's long-term debt is rated BBB+ or higher by S&P or Baa1 or
higher by Xxxxx'x and (ii) Level I Status does not exist.
"Level III Status" exists at any date if, at such date, (i) the
Guarantor's long-term debt is rated BBB or higher by S&P and Baa2 or
higher by Xxxxx'x and (ii) neither Level I Status nor Level II Status
exists.
"Level IV Status" exists at any date if, at such date, (i) the
Guarantor's long-term debt is rated BBB- or higher by S&P or Baa3 or
higher by Xxxxx'x and (ii) none of Level I Status, Level II Status and
Level III Status does not exist.
"Level V Status" exists at any date if, at such date, no other Status
exists.
"Status" refers to the determination of which of Level I Status, Level
II Status, Level III Status, Level IV Status or Level V Status exists
at any date on which interest or fees are to be determined.
The credit ratings to be utilized for the purposes of this Schedule are
those assigned to the senior, unsecured long-term debt securities of
the Guarantor without third party credit enhancement and any rating
assigned to any other debt security of the Guarantor shall be
disregarded.
The rating in effect at any date is that in effect at the close of
business on such date.
If the Guarantor has split ratings and the ratings differential is more
than one increment, the median rating (or the higher of the
intermediate ratings if there is no median rating) will apply.
SCHEDULE I
EXISTING CREDIT AGREEMENTS
Credit Agreement dated as of February 28, 1996, by and among the
Guarantor, IMC Global Operations Inc., a Delaware corporation, XXX
Xxxxxx, XXX Xxxxxx, Xxxxxxx Xxxxxx Potash, Inc., a Delaware
corporation, the banks and financial institutions listed on the
signature pages thereof, Citibank, N.A., as U.S. administrative agent
and documentation agent, Citibank Canada, as Canadian administrative
agent, Nationsbanc Capital Markets, Inc., as syndication agent and
Citicorp Securities, Inc. and Nationsbanc Capital Markets, Inc., as
Arrangers, as amended by an Amendment No. 1 dated as of September 30,
1996 (as amended, restated, supplemented or otherwise modified as of
the date hereof).
SCHEDULE II
ADDRESS FOR NOTICES
Borrowers
International Minerals & Chemical (Canada) Global Limited
c/o IMC Global Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxx
Vice President and Assistant Secretary
Phone: 000-000-0000
Fax: 000-000-0000
IMC Kalium Canada Ltd.
c/o IMC Global Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxx
Vice President and Assistant Secretary
Phone: 000-000-0000
Fax: 000-000-0000
Guarantor
IMC Global Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxx
Vice President and Assistant Secretary
Phone: 000-000-0000
Fax: 000-000-0000
Banks and Agents
Royal Bank of Canada, as Agent
Global Syndications - Canada
00xx Xxxxx, Xxxxx Xxxxx
Xxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxxx X. Xxxxxxxx
Senior Manager, Distribution & Agency
Phone: (000) 000-0000
Fax: (000) 000-0000
Royal Bank of Canada, as Bank
P.O. Box 4422
2010 - 11th Avenue, 8th Floor
Regina, Saskatchewan
S4P 3W7
Attention: Xxxxx Xxxxxx, Senior Account Manager
Phone: 000-000-0000
Fax: 000-000-0000
Bank of Montreal, as Bank and Co-Agent
000 Xxxx Xxxxxx Xxxx
0 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Client Services
Phone: 000-000-0000
Fax: 000-000-0000
First Chicago NBD Bank, Canada
BCE Place, P.O. Box 613
000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxxx X. Xxxxx and Xxxxxx Xxxxx
Phone: 000-000-0000 (main number)
Fax: 000-000-0000
X.X. Xxxxxx Canada, as Bank and Co-Agent
Xxxxx 0000, Xxxxx Xxxxx
Xxxxx Xxxx Xxxxx
000 Xxx Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxx Xxxx, Associate
Phone: 000-000-0000
Fax: 000-000-0000
EXHIBIT A
FORM OF NOTICE OF BORROWING
Date ___________
Royal Bank of Canada,
as Agent under the Credit Agreement referred to below
Ladies and Gentlemen:
The undersigned refers to the Five-Year Credit Agreement dated
as of December 22, 1997 (as the same may be amended, restated or
replaced from time to time, the "Credit Agreement"), among
International Minerals & Chemical (Canada) Global Limited, IMC Kalium
Canada Ltd., IMC Global Inc., the Banks listed on the signature pages
thereof, and Royal Bank of Canada, as Agent. Capitalized terms used
but not defined herein have the meaning assigned to such terms in the
Credit Agreement. The undersigned hereby notifies you, pursuant to
Section 2.2 of the Credit Agreement, of its election to make the
following Borrowing:
Name of Borrower:
Amount and Currency:
_________________________________
[Face Amount of Bankers'
Acceptances for Bankers'
Acceptances Borrowing]
Type of Borrowing:
_________________________________
[Syndicated or Swingline]
Date of Borrowing:
_________________________________
US Base Rate Loan or
_________________________________
Euro-Dollar Loan:
[for Syndicated Borrowing
in US$ only]
Prime Rate Loan or Bankers'
Acceptance Advance
_________________________________
[for Syndicated Borrowing
in C$ only]
Interest Period for
Euro-Dollar Borrowing:
_________________________________
BA Term for Bankers'
Acceptance Borrowing:
_________________________________
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Borrowing,
immediately after giving effect thereto and to the application of the
proceeds therefrom:
(a) immediately after such Borrowing, (i) the sum of the
aggregate outstanding principal amount of the Loans and the aggregate
amount of Bankers' Acceptance Obligations and Letters of Credit
Liabilities will not exceed the aggregate amount of the Commitments,
(ii) the aggregate outstanding principal amount of Swingline Loans will
not exceed US$10,000,000 and (iii) the aggregate amount of Letter of
Credit Liabilities will not exceed US$25,000,000;
(b) no Default shall have occurred and be continuing; and
(c) the representations and warranties (other than the
representation and warranty set forth in Section 4.1(d)(ii) in the case
of a Borrowing which does not result in an increase in the sum of the
aggregate outstanding principal amount of the Loans and the aggregate
Bankers' Acceptance Obligations and Letter of Credit Liabilities) of
the Borrowers contained in the Credit Agreement shall be true on and as
of the date of such Borrowing.
By ___________________________
Name:
Title:
EXHIBIT B
FORM OF NOTICE OF CONVERSION AND ROLLOVER
Date
Royal Bank of Canada,
as Agent under the Credit Agreement referred to below
Ladies and Gentlemen:
The undersigned (the "Borrower") refers to the Credit Agreement
dated as of December 22, 1997 (as the same may be amended, restated or
replaced from time to time, the "Credit Agreement"), among
International Minerals & Chemical (Canada) Global Limited, IMC Kalium
Canada Ltd., IMC Global Inc., the Banks listed on the signature pages
thereof, and Royal Bank of Canada, as Agent. Capitalized terms used
but not defined herein have the meaning assigned to such terms in the
Credit Agreement. The Borrower hereby notifies you, pursuant to
Section 2.9(a) of the Credit Agreement, of the following:
1. Group of Advances (or portion
thereof) to which notice applies
2. Date of conversion, rollover or
continuation
3. New type of Advance [if
Advances are to be converted]
4. Duration of next succeeding
Interest Period [if Loans are
converted to Euro-Dollar Loans]
5. Additional Interest Period [if
Loans are continued as Euro-Dollar
Loans]
6. Duration of BA Term [if Prime Rate
Loans are to be converted to Bankers'
Acceptances or if Refunding Bankers'
Acceptances are to be issued]
[NAME OF BORROWER]
By ___________________________
Name:
Title:
EXHIBIT C
FORM OF ACCEPTANCE
NOTE
C$ __________ Toronto, Ontario
FOR VALUE RECEIVED, the undersigned, [INSERT NAME OF
BORROWER] (the "Borrower"), hereby unconditionally promises to pay to
the order of [INSERT NAME OF LENDER] (the "Lender") at the office of
ROYAL BANK OF CANADA, located [at Royal Bank Plaza, 200 Bay Street,
Toronto, Ontario, Canada X0X 0X0], in lawful money of Canada and in
immediately available funds, the principal amount of C$________. The
undiscounted principal amount hereof shall be repaid on
_______________________.(1) The Borrower further agrees that interest
shall be paid hereon, in advance, by the Lender discounting the face
amount of this Acceptance Note in the manner referred to in Section
2.15 of the Credit Agreement described below (capitalized terms used
herein without definition being defined as set forth therein).
This Acceptance Note (a) is one of the Acceptance Notes
referred to in the Five-Year Credit Agreement dated as of December 22,
1997, among International Minerals & Chemical (Canada) Global Limited,
IMC Kalium Canada Ltd., IMC Global Inc., the Banks listed on the
signature pages thereof, and Royal Bank of Canada, as Agent (as
amended, restated or replaced from time to time, the "Credit
Agreement") and (b) is subject to the provisions of the Credit
Agreement.
Upon the occurrence of any one or more of the Events of
Default, all amounts then remaining unpaid on this Note shall become,
or may be declared to be, immediately due and payable, all as provided
in the Credit Agreement.
[NAME OF BORROWER]
By ___________________________
Name:
Title:
(1) Insert maturity date for Bankers' Acceptances created
simultaneously herewith.
EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, ____ among [ASSIGNOR] (the
"Assignor"), [ASSIGNEE] (the "Assignee"), INTERNATIONAL MINERALS &
CHEMICAL (CANADA) GLOBAL LIMITED ("IMC Canada"), IMC KALIUM CANADA LTD.
("IMC Kalium" and collectively with IMC Canada the "Borrowers"), and
ROYAL BANK OF CANADA, as Agent (the "Agent") [Note: Borrowers need not
be parties after Default].
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to the Five-Year Credit Agreement dated as of
December 22, 1997, among the Borrowers, International Global Inc., the
Assignor and the other Banks listed on the signature pages thereof and
Royal Bank of Canada, as Agent (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor has
a Commitment to make Loans to the Borrowers, issue Bankers' Acceptances
and participate in Letters of Credit in an aggregate principal amount
at any time outstanding not to exceed US$__________;
WHEREAS, Loans made to the Borrowers by the Assignor as Syndicated
Advances under the Credit Agreement in the aggregate principal amount
of US$__________ and C$__________ are outstanding at the date hereof;
WHEREAS, Bankers' Acceptances accepted by the Assignor with an
aggregate Face Amount of C$__________ are outstanding at the date
hereof;
[WHEREAS, Swingline Loans made by the Assignor in the aggregate
principal amount of US$ ______ and C$ _______ are outstanding at the
date hereof;]
[WHEREAS, the Assignor has an undivided participating interest in
Unrefunded Swingline Loans in the amount of US$_________ and
C$________;]
[WHEREAS, Letters of Credit issued by the Assignor with a total
amount available for drawing thereunder of US$___________ and
C$__________ are outstanding at the date hereof;] and
WHEREAS, the Assignor proposes to assign to the Assignee all of
the rights of the Assignor under the Credit Agreement in respect of a
portion of its Commitment thereunder in an amount equal to
US$__________ (the "Assigned Amount"), together with a corresponding
portion of its outstanding Advances [, participating interests] and
Letter of Credit Liabilities, details of which are set forth in
Schedule A annexed hereto and the Assignee proposes to accept
assignment of such rights and assume the corresponding obligations from
the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
Section 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the
Credit Agreement.
Section 2. Assignment. The Assignor hereby assigns and sells to
the Assignee all of the rights and interests of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, and the Assignee
hereby accepts such assignment from the Assignor and assumes all of the
obligations of the Assignor under the Credit Agreement to the extent of
the Assigned Amount, including the purchase from the Assignor of the
corresponding portion of the principal amount of the Loans made by and
Bankers' Acceptance Obligations and Letter of Credit Liabilities of,
the Assignor outstanding at the date hereof. Upon the execution and
delivery hereof by the Assignor, the Assignee, [the Borrowers,] and the
Agent, and upon the payment of the amounts specified in Section 3
required to be paid on the date hereof (i) the Assignee shall, as of
the date hereof, succeed to the rights and be obligated to perform the
obligations of a Bank under the Credit Agreement with a Commitment in
an amount equal to the Assigned Amount, and (ii) the Commitment of the
Assignor shall, as of the date hereof, be reduced by a like amount and
the Assignor released from its obligations under the Credit Agreement
to the extent such obligations have been assumed by the Assignee. The
assignment provided for herein shall be without recourse to the
Assignor.
Section 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the
Assignor on the date hereof in immediately available funds the amount
heretofore agreed between them. (2) It is understood that facility,
Stamping and Letter of Credit fees accrued to the date hereof in
respect of the Assigned Amount are for the account of the Assignor and
such fees accruing from and including the date hereof are for the
account of the Assignee. Each of the Assignor and the Assignee hereby
agrees that if it receives any amount under the Credit Agreement which
is for the account of the other party hereto, it shall receive the same
for the account of such other party to the extent of such other party's
interest therein and shall promptly pay the same to such other party.
Section 4. Consent to Assignment. This Agreement is conditioned
upon the consent of [the Borrowers and] the Agent pursuant to Section
10.9(c) of the Credit Agreement. The execution of this Agreement by
[the Borrowers], and the Agent is evidence of this consent. [Note:
Consent of Borrowers not required after Default.]
Section 5. Non-reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no
responsibility with respect to, the solvency, financial condition, or
statements of any Borrower or the Guarantor, or the validity and
enforceability of the obligations of any Borrower in respect of the
Credit Agreement. The Assignee acknowledges that it has, independently
and without reliance on the Assignor, and based on such documents and
information as it has deemed appropriate, made its own credit analysis
and decision to enter into this Agreement and will continue to be
responsible for making its own independent appraisal of the business,
affairs and financial condition of the Borrowers and the Guarantor.
Section 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the province of Ontario and
the federal laws of Canada applicable therein.
Section 7. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date
first above written.
[ASSIGNOR]
By _______________________
Name:
Title:
[ASSIGNEE]
By _______________________
Name:
Title:
INTERNATIONAL
MINERALS & CHEMICAL (CANADA) GLOBAL
LIMITED
By ______________________________
Name:
Title:
IMC KALIUM CANADA
LTD.
By ______________________________
Name:
Title:
ROYAL BANK OF CANADA,
as Agent
By ______________________________
Name:
Title:
By ______________________________
Name:
Title:
(2) Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee. It may be
preferable in an appropriate case to specify these amounts generically
or by formula rather than as a fixed sum.
EXHIBIT E-1
[Letterhead of Fraser & Xxxxxx]
December 22, 1997
TO: Each of the Banks parties to the "Canadian Credit
Agreement"
(as defined below)
AND TO: Royal Bank of Canada as Agent therein
Ladies and Gentlemen:
IMC Kalium Canada Ltd. and
International Minerals & Chemical (Canada) Global Limited
We have acted as special Ontario counsel to IMC Kalium Canada
Ltd. and to International Minerals & Chemical (Canada) Global Limited
(collectively, the "Companies") in connection with that certain Five-
Year Canadian Credit Agreement, dated as of December 22, 1997 (the
"Canadian Credit Agreement") among the Companies, as borrowers, IMC
Global Inc. (the "Guarantor"), the financial institutions parties
thereto (the "Banks") and Royal Bank of Canada, as Agent, and the
financing transaction contemplated thereby.
We have also acted as special Ontario counsel to the
Guarantor in connection with the Canadian Credit Agreement.
This opinion is furnished to you at the request of the
Companies and the Guarantor pursuant to Section 3.1(b) of the Canadian
Credit Agreement. Capitalized terms used herein and not otherwise
defined herein have the same meaning herein as in the Canadian Credit
Agreement.
In connection with this opinion, we have examined originals
or copies, certified or otherwise identified to our satisfaction, of
the Canadian Credit Agreement.
In rendering the opinions set forth herein, we have also
examined originals or copies, certified to our satisfaction, of (i)
Certificates of Compliance dated December 19, 1997 issued by Industry
Canada for each of the Companies, (ii) the officers' certificates dated
the date hereof attached as Exhibit A hereto, (iii) the articles of
incorporation and borrowing by-laws of each of the Companies, and (iv)
such other corporate records of IMC Kalium Canada Ltd. (other than the
minute books for one of its corporate predecessors, Vigoro, Inc.) and
other documents and records, and we have made such inquiries of
officers and representatives of the Companies, in each case, as we have
deemed relevant or necessary as the basis for such opinions. We have
not been able to review the minute books of International Minerals &
Chemicals (Canada) Global Limited. We have relied upon, and assumed
the accuracy of, such certificates as to factual matters, the
representations and warranties as to factual matters made by each of
the Companies and the Guarantor in the Canadian Credit Agreement, and
other statements, documents and records supplied to us by the
Companies, in each case with respect to the factual matters set forth
therein, and we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the
conformity to original documents of all documents submitted to us as
certified, facsimile or photostatic copies.
In rendering the opinions set forth herein, we have assumed
that:
all the parties to the Canadian Credit
Agreement (other than the Companies) are duly
incorporated and organized, validly existing, and in
good standing under the laws of their respective
jurisdictions of organization and have the requisite
corporate power and authority to enter into the
Canadian Credit Agreement and to perform their
obligations thereunder;
the execution and delivery and performance of
the Canadian Credit Agreement has been duly authorized
by all necessary corporate action and proceedings on
the part of all parties thereto other than the
Companies; the Canadian Credit Agreement has been duly
executed and delivered by all parties thereto other
than the Companies and constitutes the valid and
binding obligations of all parties thereto (other than
the Companies and the Guarantor) enforceable against
such other parties in accordance with its terms;
the terms and provisions of the Canadian
Credit Agreement do not, and the execution, delivery
and performance thereof by the Guarantor will not,
violate or conflict with the charter or by-laws of the
Guarantor, any contract or indenture to which it is a
party or by which it is bound, or any law or regulation
or order or decree of any court, administrative agency
or other governmental authority applicable to it;
the execution, delivery and performance by the
Guarantor of the Canadian Credit Agreement will not
result in or require the creation or imposition of any
Lien upon or with respect to any of the properties of
the Guarantor and no authorization, approval or other
action by and no notice to or filing with any
Governmental Authority (other than constituted by the
Province of Ontario or Federal Government of Canada) or
any third party is required for the due execution,
delivery and the performance by the Guarantor of the
Canadian Credit Agreement.
Based upon and subject to the foregoing and subject to the
qualifications stated herein, we are of the opinion that, as of the
date hereof:
Each of the Companies is subsisting under the laws of
Canada and has the requisite corporate power and authority to own
and encumber its properties and assets and to conduct its
business as currently conducted.
Each of the Companies has the requisite corporate power
and authority to execute, deliver, and perform its obligations
under the Canadian Credit Agreement. Such execution, delivery
and performance:
have been duly authorized by all necessary and proper
corporate action of the Companies;
do not violate any provision of the articles of
incorporation or by-laws of the Companies or require any
approval of any shareholders of the Companies except as has
been obtained;
will not violate any law or regulation of the Province
of Ontario (including, without limitation, any usury laws)
or federal laws of Canada applicable to the Companies,
including, without limitation, Section 44 of the Canada
Business Corporations Act;
to our knowledge (i) will not violate any order of any
court, and (ii) will not result in or require the creation
or imposition of any lien or security interest upon or with
respect to any of the properties or assets of the Companies;
and
to our knowledge will not violate, or require the
termination of, or require the approval or consent of any
Person (except as has been obtained) under, the terms of any
indenture, mortgage, deed of trust, loan agreement, lease
agreement or any other material agreement listed on the
officer's certificate attached as Exhibit A hereto to which
either of the Companies is a party or by which either of the
Companies or any of their respective properties may be
bound.
The Canadian Credit Agreement has been duly executed and
delivered by a duly authorized officer of each of the Companies
delivering the same and constitutes the legal, valid and binding
obligation of each of the Companies signing and delivering the
same, enforceable in accordance with its terms.
The Canadian Credit Agreement constitutes the legal,
valid and binding obligation of the Guarantor, enforceable in
accordance with its terms.
No approval, consent or authorization of, or filing or
registration with, any governmental department, agency or
instrumentality is necessary for the Companies' or Guarantor's
execution or delivery of the Canadian Credit Agreement or for the
Companies' performance of any of the terms thereof.
Our opinions above are subject to the following
qualifications:
Our opinions relating to validity, binding effect and
enforceability in Paragraphs 3 and 4 above are subject to
limitations imposed by any applicable bankruptcy, winding-
up, liquidation, insolvency, reorganization, fraudulent
conveyance, moratorium and similar laws affecting creditors'
rights generally. In addition, our opinions relating to
enforceability in Paragraphs 3 and 4 above are subject to
(i) the effect of general principles of equity (regardless
of whether considered in a proceeding in equity or at law)
and the fact that equitable remedies are available in the
discretion of courts of competent jurisdiction and (ii)
limitations imposed by public policy under certain
circumstances on the enforceability of provisions
indemnifying a party against liability for its own wrongful
or negligent acts.
We express no opinion as to the enforceability of
provisions in the Canadian Credit Agreement, which provide
for a higher rate of interest to be payable after default
which may be characterized by a court of competent
jurisdiction as an unenforceable penalty and not as a
genuine pre-estimate of damages.
We express no opinion as to the enforceability of any
provision of the Canadian Credit Agreement which requires
the Companies or the Guarantor to pay, or to indemnify the
Agent or Banks for, their costs and expenses in connection
with judicial proceedings, since those provisions are
subject to the discretion of courts of competent
jurisdiction to determine by whom and to what extent those
costs should be paid.
A judgment of an Ontario court may only be awarded in
Canadian currency.
Determinations, calculations and demands by the Agent or
the Banks in the exercise of discretion by them, pursuant to
the Canadian Credit Agreement may not be enforceable and may
be subject to challenge if made or performed arbitrarily,
unreasonably, or fraudulently.
We express no opinion as to the enforceability of any
provision of the Canadian Credit Agreement:
which purports to waive all defences which
might be available to, or waive all acts or omissions
that could otherwise constitute a discharge of the
liability of, the Companies or the Guarantor;
to the extent it purports to exculpate the
Agent or Banks from liability in respect of acts or
omissions which may be illegal, fraudulent or involve
willful misconduct;
which states that amendments or waivers of or
with respect to the Canadian Credit Agreement that are
not in writing will not be effective.
The foregoing opinions are limited to the laws of the
Province of Ontario and the federal laws of Canada applicable therein
and we express no opinion with respect to the laws of any other state
or jurisdiction.
Whenever in this opinion reference is made to our knowledge,
such reference is to the actual knowledge of the members of our firm
who have acted as special counsel to the Companies and the Guarantor in
connection with the Canadian Credit Agreement (being Xxxxx Xxxxxx and
Xxxx Xxxxxxx). With your consent, no further inquiries or
investigations have been made to determine the existence or the absence
of facts qualified by such phrase.
The opinions expressed herein are being delivered to you as
of the date hereof and are solely for your benefit in connection with
the transactions contemplated in the Canadian Credit Agreement and may
not be relied on in any manner or for any purpose by any other person,
nor any copies published, communicated or otherwise made available in
whole or in part to any other person or entity without our express
prior written consent, except that you may furnish copies thereof to
any party that becomes a Bank after the date hereof pursuant to the
Canadian Credit Agreement who may rely upon the opinions expressed
herein as if this letter had been addressed to them. We do not express
any opinion, either implicitly or otherwise, on any issue not expressly
addressed in numbered Paragraphs 1 through 5. The opinions expressed
above are based solely on facts, laws and regulations in effect on the
date hereof, and we assume no obligation to revise or supplement this
opinion should such facts change or should such laws or regulations be
changed by legislative or regulatory action, judicial decision or
otherwise, notwithstanding that such changes may affect the legal
analysis or conclusions contained herein.
Yours very truly,
EXHIBIT E-2
[Letterhead of Sidley & Austin]
December 22, 1997
TO: each of the Banks who are party to the "Five-Year Credit
Agreement"
(as defined below)
AND TO: Royal Bank of Canada, as Agent
Ladies and Gentlemen:
IMC Global Inc.
We have acted as counsel to IMC Global Inc., a Delaware
corporation (the "Company") in connection with that certain Five-Year
Credit Agreement, dated as of December 22, 1997 (the "Five-Year Credit
Agreement") among International Minerals & Chemical (Canada) Global
Limited and IMC Kalium Canada Ltd., as borrowers (collectively, the
"Borrowers"), IMC Global Inc., a Delaware corporation (the "Company"),
as guarantor, the financial institutions parties thereto (the "Banks"),
and Royal Bank of Canada, as Agent, and the transactions contemplated
thereby.
This opinion is furnished to you at the request of the
Company pursuant to Section 3.1(b) of the Five-Year Credit Agreement.
Capitalized terms used herein and not otherwise defined are used as
defined in the Five-Year Credit Agreement.
In connection with this opinion, we have examined originals
or copies, certified or otherwise identified to our satisfaction, of
the Five-Year Credit Agreement and the Merger Agreement.
In rendering the opinions set forth herein, we have also
examined originals or copies, certified to our satisfaction, of such
(i) certificates of public officials, (ii) certificates of officers and
representatives of the Company, including, without limitation, the
officer's certificate attached as Exhibit A hereto, and (iii) other
documents and records, and we have made such inquiries of officers and
representatives of the Company, as we have deemed relevant or necessary
as the basis for such opinions. We have relied upon, and assumed, as
to matters of fact stated therein, the accuracy of, such certificates,
the representations and warranties as to factual matters made by the
Company in the Five-Year Credit Agreement and made by the parties to
the Merger Agreement therein, and other statements, documents and
records supplied to us by the Company, in each case with respect to the
factual matters set forth therein, and we have assumed the genuineness
of all signatures (other than signatures of officers of the Company)
and the authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted to us
as certified or photostatic copies.
In rendering the opinions set forth herein, we have assumed
that:
all the parties to the Five-Year Credit
Agreement and the Merger Agreement (other than the
Company) are duly organized, validly existing, and in
good standing under the laws of their respective
jurisdictions of organization and have the requisite
corporate power and authority to enter into such Five-
Year Credit Agreement and the Merger Agreement, as the
case may be;
the execution and delivery of the Five-Year
Credit Agreement has been duly authorized by all
necessary corporate action and proceedings on the part
of all parties thereto other than the Company; the Five-
Year Credit Agreement has been duly executed and
delivered by all parties thereto other than the Company
and constitutes the valid and binding obligations of
all parties thereto, enforceable against such parties
in accordance with its terms;
the terms and provisions of the Five-Year
Credit Agreement do not, and the execution, delivery
and performance thereof by each of the parties thereto
(other than the Company) will not, violate or conflict
with the certificate of incorporation or by-laws of any
such party, any contract or indenture to which it is a
party or by which it is bound, or any law, order or
decree of any court, administrative agency or other
governmental authority applicable to any such party
other than the Company; and
the terms and provisions of the Merger
Agreement do not, and the execution, delivery and
performance thereof by each of the parties thereto will
not, (i) violate or conflict with the certificate of
incorporation or by-laws of any such party (other than
the Company), or (ii) except as to the Company to the
limited extent set forth in Paragraphs 2(d) and 2(e)
below, violate or conflict with any contract or
indenture to which it is a party or by which it is
bound, or any law, order or decree of any court,
administrative agency or other governmental authority
applicable to any such party.
Based upon the foregoing and subject to the qualifications
stated herein, we are of the opinion that, as of the date hereof:
The Company is validly existing and in good standing under
the laws of the State of Delaware. The Company has the requisite
corporate power and authority to own and encumber its properties and
assets and to conduct its business as currently conducted and as
currently proposed to be conducted.
The Company has the requisite corporate power and authority
to execute, deliver and perform its obligations under the Five-Year
Credit Agreement. Such execution, delivery and performance:
have been duly authorized by all necessary and proper
corporate action of the Company,
do not violate any provision of the certificate of
incorporation or by-laws of the Company or require any
approval of any shareholders of the Company,
will not violate any law or regulation of the States of
New York or Illinois (including, without limitation, any
usury laws) or of the United States of America (including,
without limitation, Regulations G, T, U or X) applicable to
the Company,
to our knowledge (i) will not violate any order of any
court, and (ii) will not result in or require the creation
or imposition of any lien or security interest upon or with
respect to any of the properties or assets of the Company;
and
will not violate, or require the termination of, or
require the approval or consent of any Person under, the
terms of any indenture, mortgage, deed of trust, loan
agreement, lease agreement or any other material agreement
listed on the officer's certificate attached as Exhibit A
hereto to which the Company is a party or by which the
Company or any of its properties may be bound.
The Five-Year Credit Agreement has been duly executed and
delivered by a duly authorized officer of the Company delivering the
same.
No approval, consent or authorization of, or filing or
registration with, any governmental department, agency or
instrumentality is necessary for the Company's execution or delivery of
the Five-Year Credit Agreement, or for the Company's performance of any
of the terms thereof other than the approvals, consents and
authorizations described on Exhibit B hereto and routine filings with
the Securities and Exchange Commission of the United States of America.
In a properly presented case, an Illinois court or a federal
court applying Illinois choice of law rules should recognize and give
effect to the choice of law provision of the Five-Year Credit Agreement
and should hold that the Five-Year Credit Agreement is to be governed
by the laws of the Province of Ontario rather than the laws of the
State of Illinois, provided that:
the choice of law was freely made by the parties
thereto;
the parties have not chosen the laws of the Province of
Ontario for the purpose of evading the provisions of the
system of law to which the transactions contemplated by the
Five-Year Credit Agreement are most closely related. We are
not aware of any facts which would lead us to believe that
the laws of the Province of Ontario were chosen for any such
purpose;
the choice of law will only be effective in regard to
substantive law, and the procedural laws of the jurisdiction
in which the substantive rights are being enforced will
generally apply; and
enforcement of any provision of the Five-Year Credit
Agreement in an Illinois court or a federal court applying
Illinois choice of law rules will not be contrary to public
policy (as that term is applied by such court) or a statute
protecting the citizens of the State of Illinois. We are
not aware of any such public policy or statue that would
prevent the recognition of and giving effect to the choice
of law.
In rendering the opinion in this Paragraph 5, we note that by
its terms the Five-Year Credit Agreement expressly selects the laws of
the Province of Ontario as the laws governing its interpretation, that
the Agent and certain Banks have a place of business in the Province of
Ontario and that the Five-Year Credit Agreement was executed and
delivered by the parties thereto in the Province of Ontario.
Any final judgment for a definite sum given by any court in
the Province of Ontario (the "foreign court") against the Company in
respect of the Five-Year Credit Agreement would, in an action to
enforce such judgment in an Illinois court or a federal court applying
Illinois principles of law and equity, be recognized as conclusive and
enforceable without reconsideration of the merits of the action,
provided that:
such judgment was for a sum certain in money;
such judgment was final, conclusive and enforceable
where rendered and does not conflict with another final and
conclusive judgment on the same cause of action and no new
admissible evidence relevant to the action is discovered
prior to the rendering of judgment by an Illinois court or a
federal court applying Illinois principles of law and
equity;
such judgment was not obtained by fraud or in a manner
contrary to natural justice;
the foreign court rendering the judgment was impartial
and provided procedures compatible with the due process and
natural justice standards of an Illinois court or a federal
court applying Illinois principles of law and equity;
the foreign court that rendered the judgment had
personal jurisdiction over the Company and jurisdiction over
the subject matter and, if jurisdiction in the foreign court
was based on personal service alone, the foreign court was
not a seriously inconvenient forum for the trial of the
action;
the proceedings in the foreign court were not contrary
to an agreement between the parties under which the dispute
in question was to be settled otherwise than by proceedings
in that court;
such judgment is a subsisting judgment and has not been
satisfied;
after the date of judgment in the foreign court, proper
application to and registration with an Illinois court to
enforce such judgment is within five (5) years and is not
otherwise barred by equitable principles including estoppel
by laches; and
the claim for relief on which the foreign judgment was
based is not repugnant to the public policy of the State of
Illinois, as that term is applied by an Illinois court or a
federal court applying Illinois principles of law. We are
not aware of any reason why a money judgment for amounts
payable under the Five-Year Credit Agreement would be
repugnant to the public policy of the State of Illinois,
save and except that an Illinois court or a federal court
applying Illinois principles of law might not recognize and
enforce a foreign judgment requiring that the Company pay a
higher rate of interest after default (than before) or pay
interest on any accrued and unpaid interest expenses, or
requiring the Company to pay fees, expenses, interest and
other amounts which in aggregate would exceed maximum rate
permissible under applicable state and federal usury laws.
Our opinions above are subject to the following
qualifications:
We express no opinion as to the effect of the compliance
or noncompliance of the Agent or any of the Banks with any
provincial, state or federal laws or regulations applicable
to any such party because of such party's legal or
regulatory status, the nature of such party's business or
the authority of such party to conduct business in any
jurisdiction.
The foregoing opinions are limited to the laws of the United
States and the States of New York and Illinois and the General
Corporation Law of the State of Delaware, and we express no opinion
with respect to the laws of any other state or jurisdiction.
Whenever in this opinion reference is made to our knowledge,
such reference is to the conscious awareness of Xxxx X. Xxxxxxxx,
Xxxxxx X. Xxxx, Xxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxx and
Xxxxxx X. Xxxxx of information regarding factual matters. With respect
to such matters, such persons have not, with your express permission
and consent, undertaken any investigation or inquiry of other lawyers,
files maintained by the firm, or officers or employees of the Company.
The reference to "conscious awareness" as used in this paragraph has
the meaning given that phrase in the Third-Party Legal Opinion Report,
Including the Legal Opinion Accord, of the Section of Business Law,
American Bar Association, 47 Bus. Law. 167, 192 (1991).
The opinions expressed herein are being delivered to you as
of the date hereof and are solely for your benefit in connection with
the transactions contemplated in the Five-Year Credit Agreement and may
not be relied on in any manner or for any purpose by any other person,
nor any copies published, communicated or otherwise made available in
whole or in part to any other person or entity without our express
prior written consent, except that you may furnish copies thereof to
any party that becomes a Bank after the date hereof pursuant to the
Five-Year Credit Agreement who may rely on the opinions expressed
herein as if this letter were addressed to them. We do not express any
opinion, either implicitly or otherwise, on any issue not expressly
addressed in numbered Paragraphs 1 through 6. The opinions expressed
above are based solely on facts, laws and regulations in effect on the
date hereof, and we assume no obligation to revise or supplement this
opinion should such facts change or should such laws or regulations be
changed by legislative or regulatory action, judicial decision or
otherwise, notwithstanding that such changes may affect the legal
analysis or conclusions contained herein.
Very truly yours,
EXHIBIT E-3
[Letterhead of IMC Global Inc.]
December 22, 1997
TO: each of the Banks parties to the "Credit Agreement"
(as defined below)
AND TO: Royal Bank of Canada, as Agent
Ladies and Gentlemen:
IMC Global Inc.
This opinion is furnished to you pursuant to Section 3.01(b)
of that certain Five-Year Credit Agreement, dated as of December 22,
1997 (the "Credit Agreement") among International Minerals & Chemical
(Canada) Global Limited and IMC Kalium Canada Ltd., as borrowers
(collectively, the "Borrowers"), IMC Global Inc., a Delaware
corporation (the "Company"), as guarantor, the financial institutions
parties thereto (the "Banks"), and Royal Bank of Canada, as Agent, and
the transactions contemplated thereby. Capitalized terms used herein
and not otherwise defined are used as defined in the Credit Agreement.
I am the General Counsel of the Company and have acted in
such capacity in connection with the preparation, execution and
delivery of the Credit Agreement and the Merger Agreement.
In that connection, I have examined:
counterparts of the Credit Agreement and the Merger
Agreement, in each case executed by each of the parties
thereto; and
the certificates of incorporation and by-laws of the
Company as amended through the date hereof.
I have also examined the originals, or copies certified to my
satisfaction, of all of the indentures, loan or credit agreements,
guarantees, mortgages, security agreements, bonds, notes and other
agreements or instruments, in each case which are material to the
Company (collectively, the "Relevant Contracts"), and all of the
orders, writs, judgments, injunctions, decrees, determinations and
awards of which I am aware, after diligent inquiry, that affect or
purport to affect the obligations of the Company under the Credit
Agreement, or the right of the Company to guaranty the obligations of
the Borrowers party to the Credit Agreement or to consummate the
transactions contemplated by the Credit Agreement.
In addition, I have examined the originals, or copies
certified to my satisfaction, of such other corporate records of the
Company, certificates of public officials and of officers of the
Company, and agreements, instruments and other documents, as I have
deemed necessary as a basis for the opinions expressed below. As to
questions of fact material to such opinions, I have, when relevant
facts were not independently established by me, relied upon
certificates of public officials.
In my examination of the documents referred to above, I have
assumed (i) the due execution and delivery, pursuant to due
authorization, of each of the documents referred to above by all
parties thereto other than the Company, (ii) the authenticity of all
such documents submitted to me as originals and (iii) the conformity to
originals of all such documents submitted to me as copies.
I am qualified to practice law in the States of New York and
Illinois. This opinion is limited to the laws of the States of New
York and Illinois, the General Corporation Law of the State of Delaware
and the Federal laws of the United States.
Based upon the foregoing and upon such investigation as I
have deemed necessary, I am of the following opinion as of the date
hereof:
The Company (a) is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware,
(b) has all requisite corporate power and authority to own or lease and
operate its properties and to carry on its business as now conducted,
and (c) is duly qualified to do business and is in good standing in
every state where it owns or leases real property, or in which the
conduct of its business requires it to so qualify or be licensed,
except where the failure to so qualify or be licensed could not be
reasonably expected to have a Material Adverse Effect.
The execution, delivery and performance by the Company of
each of the Merger Agreement and the Credit Agreement, and the
consummation of the transactions contemplated by the Merger Agreement
and the Credit Agreement, are within the Company's corporate powers,
have been duly authorized by all necessary corporate action, and do not
(a) contravene the Company's charter or by-laws or (b) violate any law,
rule, or regulation of the State of New York or Federal law of the
United States, or any order, writ, judgment, injunction, decree,
determination or award binding on or affecting or any of its properties
or (c) conflict with or result in the breach of, or constitute a
default under, any Relevant Contracts binding on or affecting the
Company or any of its properties or (d) result in or require the
creation or imposition of any Lien upon or with respect to any of the
properties of the Company or any of its Subsidiaries.
No authorization, approval, or other action by, and no notice
to or filing with, any governmental authority or regulatory body or any
third party is required for (a) the due execution, delivery and
performance (i) by the Company of the Merger Agreement or for the
consummation of the transactions contemplated thereby, or (ii) by the
Company of the Credit Agreement or for the consummation of the
transactions contemplated thereby or (b) the exercise by the Agent or
any Bank of its rights under the Credit Agreement, other than, in the
case of this numbered paragraph 3, the authorizations, approvals,
actions, notices and filings listed on Exhibit A hereto, all of which
have been duly obtained, taken, given or made and are in full force and
effect.
The Credit Agreement has been duly executed and delivered by
the Company.
To the best of my knowledge, there is no action, suit,
investigation, litigation or proceeding pending or overtly threatened
affecting the Company before any court, governmental agency or
arbitrator that (a) purports to affect the legality, validity, binding
effect or enforceability of the Merger Agreement or the Credit
Agreement or the consummation of the transactions contemplated by the
Merger Agreement or the Credit Agreement or (b) could reasonably be
expected to have a Material Adverse Effect.
In a properly presented case, an Illinois court or a federal
court applying Illinois choice of law rules should recognize and give
effect to the choice of law provision of the Credit Agreement and
should hold that the Credit Agreement is to be governed by the laws of
the Province of Ontario rather than the laws of the State of Illinois,
provided that:
the choice of law was freely made by the parties
thereto;
the parties have not chosen the laws of the Province of
Ontario for the purpose of evading the provisions of the
system of law to which the transactions contemplated by the
Credit Agreement are most closely related. I am not aware
of any facts which would lead me to believe that the laws of
the Province of Ontario were chosen for any such purpose;
the choice of law will only be effective in regard to
substantive law, and the procedural laws of the jurisdiction
in which the substantive rights are being enforced will
generally apply;
enforcement of any provision of the Credit Agreement in
an Illinois court or a federal court applying Illinois
choice of law rules will not be contrary to public policy
(as that term is applied by such court) or a statute
protecting the citizens of the State of Illinois. I am not
aware of any such public policy or statute that would
prevent the recognition of and giving effect to the choice
of law.
In rendering the opinion in this Paragraph 6, I note that by
its terms the Credit Agreement expressly selects the laws of the
Province of Ontario as the laws governing its interpretation, that the
Agent and certain Banks have a place of business in the Province of
Ontario and that the Credit Agreement was executed and delivered by the
parties thereto in the Province of Ontario.
Any final judgment for a definite sum given by any court in
the Province of Ontario (the "foreign court") against the Company in
respect of the Credit Agreement would, in an action to enforce such
judgment in an Illinois court or a federal court applying Illinois
principles of law and equity, be recognized as conclusive and
enforceable without reconsideration of the merits of the action,
provided that:
such judgment was for a sum certain in money;
such judgment was final, conclusive and enforceable
where rendered and does not conflict with another final and
conclusive judgment on the same cause of action and no new
admissible evidence relevant to the action is discovered
prior to the rendering of judgment by an Illinois court or a
federal court applying Illinois principles of law and
equity;
such judgment was not obtained by fraud or in a manner
contrary to natural justice;
the foreign court rendering the judgment was impartial
and provided procedures compatible with the due process and
natural justice standards of an Illinois court or a federal
court applying Illinois principles of law and equity;
the foreign court that rendered the judgment had
personal jurisdiction over the Company and jurisdiction over
the subject matter and, if jurisdiction in the foreign court
was based on personal service alone, the foreign court was
not a seriously inconvenient forum for the trial of the
action;
the proceedings in the foreign court were not contrary
to an agreement between the parties under which the dispute
in question was to be settled otherwise than by proceedings
in that court;
such judgment is a subsisting judgment and has not been
satisfied;
after the date of judgment in the foreign court, proper
application to and registration with an Illinois court to
enforce such judgment is within five (5) years and is not
otherwise barred by equitable principles including estoppel
by laches; and
the claim for relief on which the foreign judgment was
based is not repugnant to the public policy of the State of
Illinois, as that term is applied by an Illinois court or a
federal court applying Illinois principles of law. I am not
aware of any reason why a money judgment for amounts payable
under the Credit Agreement would be repugnant to the public
policy of the State of Illinois, save and except that an
Illinois court or a federal court applying Illinois
principles of law might not recognize and enforce a foreign
judgment requiring that the Company pay a higher rate of
interest after default (than before) or pay interest on any
accrued and unpaid interest expenses, or requiring the
Company to pay fees, expenses, interest and other amounts
which in aggregate would exceed maximum rate permissible
under applicable state and federal usury laws.
Neither the Company nor any Subsidiary of the Company is an
"investment company", or any "affiliated person" of, or a "promoter" or
"principal underwriter" for, an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended.
The opinions expressed herein are being delivered to you as
of the date hereof and are solely for your benefit in connection with
the transaction contemplated in the Credit Agreement and may not be
relied on in any manner or for any purpose by any other person, nor any
copies published, communicated or otherwise made available in whole or
in part to any other person or entity without our express prior written
consent, except that you may furnish copies thereof to any party that
becomes a Bank after the date hereof pursuant to the Credit Agreement
who may rely on the opinions expressed herein as if this letter were
addressed to them. I do not express any opinion, either implicitly or
otherwise, on any issue not expressly addressed in this opinion. The
opinions expressed above are based solely on facts, laws and
regulations in effect on the date hereof, and I assume no obligation to
revise or supplement this opinion should such facts change or should
such laws or regulations be changed by legislative or regulatory
action, judicial decision or otherwise, notwithstanding that such
changes may affect the legal analysis or conclusions contained herein.
Very truly yours,
Xxxxxxxxx X. Xxxxx
EXHIBIT F-1
BANKERS' ACCEPTANCES POWER OF ATTORNEY
WHEREAS (the "Borrower") wishes to facilitate the
acceptance of Bankers' Acceptances under the Five-Year Canadian Credit
Agreement dated as of December 22, 1997 among International Minerals &
Chemical (Canada) Global Limited, IMC Kalium Canada Ltd, IMC Global
Inc., Royal Bank of Canada, as Agent, and the Banks named therein (the
"Banks") (as amended, restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"). Capitalized terms used and not
defined herein shall have the meanings given to them in the Credit
Agreement.
NOW THEREFORE the Borrower hereby appoints [insert name of
bank] (hereinafter called the "Bank"), acting by the [insert titles of
bank officers] for the time being of the Bank's Applicable Lending
Office, the attorney of the Borrower:
to sign for and on behalf and in the name of the
Borrower as drawer, drafts in the form attached hereto as
Exhibit A ("Drafts") drawn on the Bank and payable to the
order of the Bank;
to fill in the Face Amount, date and maturity date of
such Drafts.
The acts described in (a) and (b) above are to be undertaken by the
Bank strictly in accordance with instructions given to the Bank by the
Agent as provided in this Power of Attorney.
Instructions to the Bank relating to the execution,
completion and endorsement by the Bank on behalf of the Borrower of
Drafts which the Borrower wishes to submit to the Bank for acceptance
and purchase by the Bank shall, following the receipt by the Agent of a
Notice of Borrowing from the Borrower relating to a Bankers' Acceptance
Borrowing pursuant to Section 2.2 of the Credit Agreement, be
communicated by the Agent in writing to the Bank's [insert title of
bank officers] at the Bank's Applicable Lending Office and shall
specify the following information:
reference to this Power of Attorney;
the date of the Bankers' Acceptance Borrowing;
the amount which shall be the aggregate Face Amount of
the Bankers' Acceptances to be accepted by the Bank in
respect of the Borrowing;
the BA Term (as expressly permitted by and in accordance
with the Credit Agreement) which shall be the number of days
after the date of such Bankers' Acceptances that such
Bankers' Acceptances are to be payable; and
discount/payment instructions specifying the account
number of the Borrower and the financial institution at
which the BA Discount Proceeds (net of applicable Stamping
Fee) from the purchase of such Bankers' Acceptances are to
be credited.
The communication by the Agent to the Bank of the
instructions referred to above in accordance with Section 2.3(a) of the
Credit Agreement shall constitute (a) the authorization and instruction
of the Borrower to the Bank to execute, complete and endorse Drafts in
accordance with such information as set out above and (b) the request
of the Borrower to the Bank to purchase the resulting Bankers'
Acceptances at the Applicable BA Discount Rate. The Borrower
acknowledges that the Bank shall not be obligated to accept any such
Drafts or purchase any Bankers' Acceptances except in accordance with
the provisions of the Credit Agreement.
The Bank shall be and it is hereby authorized to act on
behalf of the Borrower upon and in compliance with instructions
communicated to the Bank by the Agent as provided herein if the Bank
reasonably believes them to be genuine. Any actions undertaken by the
Bank in accordance with such instructions shall be conclusively deemed
to have been taken in accordance with the instructions of the Borrower
and shall be binding upon the Borrower.
The Borrower agrees to indemnify the Bank and its directors,
officers, employees, affiliates and agents to hold it and them harmless
from and against any loss, liability, expense or claim of any kind or
nature whatsoever incurred by any of them as a result of any action or
inaction in any way relating to or arising out of this Power of
Attorney or the acts contemplated hereby; provided that this indemnity
shall not apply to any such loss, liability, expense or claim which
results from the gross negligence or wilful misconduct of the Bank or
any of its directors, officers, employees, affiliates or agents.
This Power of Attorney may be revoked at any time upon not
less than three Business Days' written notice served upon the Bank in
accordance with the provisions of the Credit Agreement, provided that
no such revocation shall reduce, limit or otherwise affect the
obligations of the Borrower in respect of any Draft executed, completed
or endorsed, or any Bankers' Acceptance purchased, in accordance
herewith prior to the time at which such revocation becomes effective.
This Power of Attorney is in addition to and not in
substitution for any agreement to which the Bank and the Borrower are
parties.
This Power of Attorney shall be governed in all respects by
the laws of the Province of Ontario and the laws of Canada applicable
therein and each of the Borrower and the Bank hereby irrevocably
attorns to the non-exclusive jurisdiction of the courts of the
Provinces of Ontario and Saskatchewan in respect of all matters arising
out of this Power of Attorney.
In the event of a conflict between the provisions of this
Power of Attorney and the Credit Agreement, the Credit Agreement shall
prevail.
DATED at Toronto, Ontario this day of , 1997.
By _______________________________
Name:
Title:
EXHIBIT A
FORM OF BANKERS' ACCEPTANCE
BANKERS' ACCEPTANCE No.
To:
Bank
Address Due: 19
days after date (without grace)
ACCEPTED For value received pay to the order of the undersigned drawer
the sum of $
Dollars $
Value Received and Charge to the Account of:
For
Authorized Signature Per:
Authorized Signature Per:
Per:
Per:
EXHIBIT F-2
ACCEPTANCE NOTES POWER OF ATTORNEY
WHEREAS (the "Borrower") wishes to facilitate the issue and
purchase of Acceptance Notes under the Five-Year Canadian Credit
Agreement dated as of December 22 among International Minerals &
Chemical (Canada) Global Limited, IMC Kalium Canada Ltd, IMC Global
Inc., Royal Bank of Canada, as Agent, and the Banks named therein (the
"Banks") (as amended, restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"). Capitalized terms used and not
defined herein shall have the meanings given to them in the Credit
Agreement.
NOW THEREFORE the Borrower hereby appoints [insert name of
bank] (hereinafter called the "Bank"), acting by the [insert titles of
bank officers] for the time being of the Bank's Applicable Lending
Office, the attorney of the Borrower:
to sign for and on behalf and in the name of the
Borrower, Acceptance Notes in the form attached as Exhibit C
to the Credit Agreement ("Notes") and payable to the order of
the Bank;
to fill in the principal amount, date and repayment date
of such Notes.
The acts described in (a) and (b) above are to be undertaken by the
Bank in accordance with instructions given to the Bank by the Agent as
provided in this Power of Attorney.
Instructions to the Bank relating to the execution and
completion by the Bank on behalf of the Borrower of Notes which the
Borrower wishes to submit to the Bank for purchase by the Bank shall,
following the receipt by the Agent of a Notice of Borrowing from the
Borrower relating to a Bankers' Acceptance Borrowing pursuant to
Section 2.2 of the Credit Agreement, be communicated by the Agent in
writing to the Bank's [insert title of bank officers] at the Bank's
Applicable Lending Office and shall specify the following information:
reference to this Power of Attorney;
the date of the Bankers' Acceptance Borrowing;
the amount which shall be the aggregate principal of the
Notes to be purchased by the Bank in respect of the
Borrowing;
a specified period of time (as expressly permitted by
and in accordance with the Credit Agreement) which shall be
the number of days after the date of such Notes that such
Notes are to be payable; and
discount/payment instructions specifying the account
number of the Borrower and the financial institution at which
the BA Discount Proceeds (net of applicable Stamping Fee)
from the purchase of such Notes are to be credited.
The communication by the Agent to the Bank of the
instructions referred to above in accordance with Section 2.3(a) of the
Credit Agreement shall constitute (a) the authorization and instruction
of the Borrower to the Bank to execute and complete Notes in accordance
with such information as set out above and (b) the request of the
Borrower to the Bank to purchase the Notes at the Applicable BA
Discount Rate. The Borrower acknowledges that the Bank shall not be
obligated to complete, execute or purchase any Notes except in
accordance with the provisions of the Credit Agreement.
The Bank shall be and it is hereby authorized to act on
behalf of the Borrower upon and in compliance with instructions
communicated to the Bank by the Agent as provided herein if the Bank
reasonably believes them to be genuine. Any actions undertaken by the
Bank in accordance with such instructions shall be conclusively deemed
to have been taken in accordance with the instructions of the Borrower
and shall be binding upon the Borrower.
The Borrower agrees to indemnify the Bank and its directors,
officers, employees, affiliates and agents to hold it and them harmless
from and against any loss, liability, expense or claim of any kind or
nature whatsoever incurred by any of them as a result of any action or
inaction in any way relating to or arising out of this Power of
Attorney or the acts contemplated hereby; provided that this indemnity
shall not apply to any such loss, liability, expense or claim which
results from the gross negligence or wilful misconduct of the Bank or
any of its directors, officers, employees, affiliates or agents.
This Power of Attorney may be revoked at any time upon not
less than three Business Days' written notice served upon the Bank in
accordance with the provisions of the Credit Agreement, provided that
no such revocation shall reduce, limit or otherwise affect the
obligations of the Borrower in respect of any Note executed, completed
or purchased in accordance herewith prior to the time at which such
revocation becomes effective.
This Power of Attorney is in addition to and not in
substitution for any agreement to which the Bank and the Borrower are
parties.
This Power of Attorney shall be governed in all respects by
the laws of the Province of Ontario and the laws of Canada applicable
therein and each of the Borrower and the Bank hereby irrevocably
attorns to the non-exclusive jurisdiction of the courts of the
Provinces of Ontario and Saskatchewan in respect of all matters arising
out of this Power of Attorney.
In the event of a conflict between the provisions of this
Power of Attorney and the Credit Agreement, the Credit Agreement shall
prevail.
DATED at Toronto, Ontario this day of , 1997.
By _______________________________
Name:
Title:
