1
Exhibit 11(b)
[CONFORMED COPY]
$400,000,000
CREDIT AGREEMENT
dated as of
December 16, 1994
among
Harcourt General, Inc.,
The Banks Listed Herein,
Xxxxxx Guaranty Trust Company of New York,
as Documentation Agent,
The First National Bank of Boston,
as Administrative Agent
and
The Bank of Nova Scotia
and
National Westminster Bank Plc,
as Co-Agents
TABLE OF CONTENTS(1)
Page
ARTICLE I
DEFINITIONS
2
SECTION 1.01 Definitions.................................. 1
1.02 Accounting Terms and Determinations.......... 15
1.03 Types of Borrowings.......................... 15
ARTICLE II
THE CREDITS
(1) The Table of Contents is not a part of this Agreement.
SECTION 2.01 Commitments to Lend.......................... 16
2.02 Notice of Committed Borrowing................ 16
2.03 Money Market Borrowings...................... 17
2.04 Notice to Banks; Funding of Loans............ 21
2.05 Notes........................................ 22
2.06 Maturity of Loans............................ 23
2.07 Interest Rates............................... 23
2.08 Facility Fee................................. 26
2.09 Optional Termination or
Reduction of Commitments................... 27
2.10 Scheduled Termination of
Commitments................................ 27
2.11 Optional Prepayments......................... 27
2.12 General Provisions as to Payments............ 28
2.13 Funding Losses............................... 28
2.14 Computation of Interest and Fees............. 29
2.15 Regulation D Compensation.................... 29
2.16 Replacement of Banks......................... 30
ARTICLE III
CONDITIONS
SECTION 3.01 Effectiveness................................ 30
3.02 Borrowings................................... 31
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Corporate Existence and Power................ 32
4.02 Corporate Authorization...................... 32
4.03 Binding Effect............................... 33
4.04 Financial Information........................ 33
4.05 Litigation................................... 33
4.06 Governmental and Other Approvals............. 34
4.07 Full Disclosure.............................. 34
4.08 Compliance with ERISA........................ 34
4.09 Taxes........................................ 34
4.10 Environmental Matters........................ 35
ARTICLE V
COVENANTS
SECTION 5.01 Furnishing of Financial Data
and Certificates........................... 35
5.02 Payment of Taxes............................. 36
5.03 Maintenance of Corporate Existence........... 37
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5.04 Maintenance of Property and Leases........... 37
5.05 Insurance.................................... 37
5.06 Accounts and Reports......................... 37
5.07 Inspection................................... 37
5.08 Maintenance of Net Worth .................... 38
5.09 Coverage of Consolidated Fixed
Charges.................................... 38
5.10 Leverage Ratio............................... 38
5.11 Restrictions on Liens........................ 38
5.12 Restricted Payments.......................... 40
5.13 Investments.................................. 40
5.14 Restrictions on Sales, Consolidations
and Mergers................................ 43
5.15 Transactions with Affiliates................. 43
5.16 Restriction on Debt of Subsidiaries.......... 43
5.17 Use of Proceeds.............................. 44
ARTICLE VI
DEFAULTS
SECTION 6.01 Events of Default............................ 44
6.02 Notice of Default............................ 47
ARTICLE VII
THE AGENTS AND THE CO-AGENTS
SECTION 7.01 Appointment and Authorization................ 47
7.02 Agents and Affiliates........................ 47
7.03 Action by Agents............................. 48
7.04 Consultation with Experts.................... 48
7.05 Liability of Agents.......................... 48
7.06 Indemnification.............................. 48
7.07 Credit Decision.............................. 49
7.08 Successor Agents............................. 49
7.09 Agents' Fees................................. 49
7.10 Co-Agents.................................... 49
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01 Basis for Determining Interest
Rate Inadequate or Unfair.................. 50
8.02 Illegality................................... 51
8.03 Increased Cost and Reduced Return............ 51
8.04 Taxes........................................ 53
8.05 Base Rate Loans Substituted for
Affected Fixed Rate Loans.................. 55
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices...................................... 56
9.02 No Waivers................................... 56
9.03 Expenses; Indemnification.................... 56
9.04 Sharing of Set-Offs.......................... 57
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9.05 Amendments and Waivers....................... 58
9.06 Successors and Assigns....................... 58
9.07 Collateral................................... 60
9.08 Governing Law; Submission to Jurisdiction.... 60
9.09 Counterparts; Integration.................... 60
9.10 WAIVER OF JURY TRIAL......................... 61
Pricing Schedule
Exhibit A - Note
Exhibit B - Form of Money Market Quote Request
Exhibit C - Form of Invitation for Money Market Quotes
Exhibit D - Form of Money Market Quote
Exhibit E - Opinion of Counsel for the Borrower
Exhibit F - Opinion of Xxxxx Xxxx & Xxxxxxxx, Special Counsel for the
Agent
Exhibit G - Assignment and Assumption Agreement
CREDIT AGREEMENT
AGREEMENT dated as of December 16, 1994 among HARCOURT GENERAL,
INC., the BANKS listed on the signature pages hereof, XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, as Documentation Agent, THE FIRST NATIONAL BANK OF BOSTON,
as Administrative Agent and THE BANK OF NOVA SCOTIA and NATIONAL WESTMINSTER
BANK PLC, as Co-Agents.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used
herein, have the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Adjusted CD Rate" has the meaning set forth in Section 2.07(b).
"Adjusted Consolidated Net Income" means, for any period,
Consolidated Net Income for such period, plus the aggregate of the following
items of the Borrower and its Subsidiaries for such period:
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(a) taxes based on or measured by income;
(b) minimum rentals, i.e., rentals paid by the Borrower or any
Subsidiary, other than amounts determined by reference to income
generated from the leased property (including amounts accrued for or
based on taxes, other than income taxes, to the extent that any thereof
are payable in addition to rent), under any lease of real property
excluding in any event (i) leases between the Borrower and a Subsidiary
or between a Subsidiary and another Subsidiary, (ii) Capitalized Leases
and (iii) leases of real property entered into for periods not greater
than one year by Drake Beam Xxxxx, Inc. and its Subsidiaries; and
(c) interest on any Debt outstanding during such period.
"Adjusted Net Worth" means, at any date, the consolidated
shareholders equity of the Borrower and its Subsidiaries (reflecting the
Borrower's investment in NMG and its Subsidiaries on the cost method) determined
as of such date, plus an amount equal to the lesser of (A) the aggregate amount
paid by the Borrower subsequent to October 31, 1994 and on or prior to such date
in respect of the repurchase of common stock of the Borrower and (B)
$100,000,000.
"Administrative Agent" means The First National Bank of Boston in
its capacity as administrative agent for the Banks hereunder, and its successors
in such capacity.
"Administrative Questionnaire" means, with respect to each Bank,
an administrative questionnaire in the form prepared by the Agent and submitted
to the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls the Borrower (a "Controlling
Person") or (ii) any Person (other than the Borrower or a Subsidiary) 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 direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise. For purposes of this Agreement no individual shall be deemed to be an
Affiliate solely by reason of the fact that such individual is a director or
officer of the Borrower.
"Agent" means the Administrative Agent or the Documentation
Agent, and "Agents" means the Administrative Agent and the Documentation Agent.
"Applicable Lending Office" means, with respect to any Bank, (i)
in the case of its Domestic Loans, its Domestic Lending Office, (ii) in the case
of its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case
of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" has the meaning set forth in Section 2.07(b).
"Assignee" has the meaning set forth in Section 9.06(c).
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 9.06(c), and their respective
successors.
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"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank as a
Base Rate Loan in accordance with the applicable Notice of Committed Borrowing
or pursuant to Article VIII.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means Harcourt General, Inc., a Delaware
corporation, and its successors.
"Borrower's 1993 Form 10-K" means the Borrower's annual report on
Form 10-K for 1993, as filed with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934.
"Borrowing" has the meaning set forth in Section 1.03.
"Capitalized Lease" means a lease under which, in accordance with
generally accepted accounting principles, the liability of the lessee is
required to be capitalized on its balance sheet.
"CD Base Rate" has the meaning set forth in Section 2.07(b).
"CD Loan" means a Committed Loan to be made by a Bank as a CD
Loan in accordance with the applicable Notice of Committed Borrowing.
"CD Margin" has the meaning set forth in Section 2.07(b).
"CD Reference Banks" means The Bank of Nova Scotia, National
Westminster Bank Plc, The First National Bank of Boston and Xxxxxx Guaranty
Trust Company of New York.
"Co-Agent" means each of The Bank of Nova Scotia and National
Westminster Bank Plc, in its capacity as co-agent hereunder.
"Commitment" means, with respect to each Bank, the amount set
forth opposite the name of such Bank on the signature pages hereof, as such
amount may be reduced from time to time pursuant to Section 2.09.
"Committed Loan" means a loan made by a Bank pursuant to
Section 2.01.
"Consolidated Fixed Charges" means for any period, the sum of the
items included in Adjusted Consolidated Net Income pursuant to paragraphs (b)
and (c) of the definition thereof for such period.
"Consolidated Net Income" means for any period, the aggregate of
the net income (less losses) of the Borrower and its Subsidiaries for such
period (after eliminating all intercompany items and after provisions for
minority interests, if any), all determined in accordance with generally
accepted accounting principles; provided, however, Consolidated Net Income shall
not include (a) extraordinary gains or extraordinary losses, (b) the net income
of any corporation or other enterprise accrued prior to the date it becomes a
Subsidiary, (c) the net income arising from any discontinued
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operation(s) of the Borrower or any Subsidiary as so classified in the
Borrower's consolidated financial statements, (d) any amortization or write-off
of goodwill arising in connection with a merger, consolidation or acquisition of
stock or assets to which the Borrower or a Subsidiary is a party or (e) the net
income (or loss) of NMG and its Subsidiaries, except (in the case of income) to
the extent of dividends received by the Borrower from NMG.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which would be consolidated with those of the
Borrower in its consolidated financial statements if such statements were
prepared as of such date. NMG and its Subsidiaries are Consolidated
Subsidiaries.
"Debt" of any Person means, at any date, all obligations of such
Person which would, in accordance with generally accepted accounting principles,
be classified as liabilities (excluding deferred tax liabilities) of such
Person, as of such date, but in any event including (i) all obligations of such
Person as lessee under Capitalized Leases and (ii) all Debt of others secured by
a Lien on any asset of such Person, whether or not such Debt is assumed by such
Person and excluding, subject to Section 5.13(t), all Debt of others Guaranteed
by such Person, except to the extent the same would be reflected as a liability
on a balance sheet of such Person prepared in accordance with generally accepted
accounting principles as of such date.
"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.
"Documentation Agent" means Xxxxxx Guaranty Trust Company of New
York in its capacity as documentation agent for the Banks hereunder, and its
successors in such capacity.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in New York City or Boston, Massachusetts
are authorized by law to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending Office)
or such other office as such Bank may hereafter designate as its Domestic
Lending Office by notice to the Borrower and the Administrative Agent; provided
that any Bank may so designate separate Domestic Lending Offices for its Base
Rate Loans, on the one hand, and its CD Loans, on the other hand, in which case
all references herein to the Domestic Lending Office of such Bank shall be
deemed to refer to either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
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"Domestic Reserve Percentage" has the meaning set forth in
Section 2.07(b).
"Effective Date" means the date this Agreement becomes effective
in accordance with Section 3.01.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all members
of a controlled group of corporations and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Euro-Dollar Lending Office by notice
to the Borrower and the Administrative Agent.
"Euro-Dollar Loan" means a Committed Loan to be made by a Bank as
a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section
2.07(c).
"Euro-Dollar Reference Banks" means the principal London offices
of The Bank of Nova Scotia, National Westminster Bank Plc, The First National
Bank of Boston and Xxxxxx Guaranty Trust Company of New York.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five billion
dollars in respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of
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extensions of credit or other assets which includes loans by a non-United States
office of any Bank to United States residents).
"Event of Default" has the meaning set forth in Section 6.01.
"Existing Credit Agreement" means the Credit Agreement dated as
of December 16, 1993 among the Borrower, the banks listed on the signature pages
thereof, Xxxxxx Guaranty Trust Company of New York, as documentation agent, The
First National Bank of Boston, as administrative agent and The Bank of Nova
Scotia and National Westminster Bank Plc, as co-agents.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if no such rate is so
published on such next succeeding Domestic Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to The First National Bank of
Boston on such day on such transactions as determined by the Administrative
Agent.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money
Market Loans (excluding Money Market LIBOR Loans bearing interest at the Base
Rate pursuant to Section 8.01(a)) or any combination of the foregoing.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation 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" used as a verb has a corresponding meaning.
"Indemnitee" has the meaning set forth in Section 9.03(b).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending one,
two, three or six months thereafter, as the Borrower may elect in the applicable
Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
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(2) with respect to each CD Borrowing, the period commencing on the date of such
Borrowing and ending 30, 60, 90 or 180 days thereafter, as the Borrower may
elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(3) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(4) with respect to each Money Market LIBOR Borrowing, the period commencing on
the date of such Borrowing and ending such whole number of months thereafter as
the Borrower may elect in accordance with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(5) with respect to each Money Market Absolute Rate Borrowing, the period
commencing on the date of such Borrowing and ending such number of days
thereafter (but not less than 15 days) as the Borrower may elect in accordance
with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended, or any successor statute.
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"Investment" means all loans, advances, extensions of credit,
guarantees, purchases of stock (other than stock of the Borrower) or other
securities, contributions to capital or otherwise, whether existing on the date
of this Agreement or hereafter made.
"Leverage Ratio" means, at any date, the percentage equivalent of
a fraction the numerator of which is Total Adjusted Debt at such date and the
denominator of which is Total Capitalization at such date.
"LIBOR Auction" means a solicitation of Money Market Quotes
setting forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.03.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, the Borrower or any Subsidiary shall
be deemed to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such
asset.
"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money
Market Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money
Market Loans or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.07(c).
"Material Debt" means Debt (other than the Loans) of the Borrower
and/or one or more of its Consolidated Subsidiaries, in an aggregate principal
amount exceeding $10,000,000.
"Material Financial Obligations" means a principal amount of Debt
and/or payment or collateralization obligations in respect of Derivatives
Obligations of the Borrower and/or one or more of its Subsidiaries, exceeding in
the aggregate $10,000,000.
"Material Plan" means at any time a Plan or Plans having
aggregate Unfunded Liabilities in excess of $10,000,000.
"Money Market Absolute Rate" has the meaning set forth in
Section 2.03(d).
"Money Market Absolute Rate Loan" means a loan to be made by a
Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such Bank
as it may hereafter designate as its Money Market Lending Office by notice to
the Borrower and the Agent; provided that any Bank may from time to time by
notice to the Borrower and the Administrative Agent designate separate Money
Market Lending Offices for its Money Market LIBOR Loans, on the one hand, and
its Money Market Absolute Rate Loans, on the other hand, in which case all
references herein to the Money Market Lending Office of such Bank shall be
deemed to refer to either or both of such offices, as the context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank
pursuant to a LIBOR Auction (including such a loan bearing interest at the Base
Rate pursuant to Section 8.01(a)).
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"Money Market Loan" means a Money Market LIBOR Loan or a Money
Market Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.03(d).
"Money Market Quote" means an offer by a Bank to make a Money
Market Loan in accordance with Section 2.03.
"Xxxxx'x" has the meaning set forth in the Pricing Schedule.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.
"NMG" means The Xxxxxx-Xxxxxx Group, Inc., a Delaware
corporation.
"Notes" means promissory notes of the Borrower, substantially in
the form of Exhibit A hereto, evidencing the obligation of the Borrower to repay
the Loans, and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined in
Section 2.03(f)).
"Parent" means, with respect to any Bank, any Person
controlling such Bank.
"Participant" has the meaning set forth in Section 9.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.
"Pricing Schedule" means the Schedule attached hereto
identified as such.
"Prime Rate" means the rate of interest publicly announced by
Xxxxxx Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
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"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any one
of such Reference Banks.
"Refunding Borrowing" means a Committed Borrowing which, after
application of the proceeds thereof, results in no net increase in the
outstanding principal amount of Committed Loans made by any Bank.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Rental Expense" means, for any period, the amount of the item
included in Adjusted Consolidated Net Income pursuant to paragraph (b) of the
definition thereof for such period.
"Required Banks" means at any time Banks having at least 66 2/3%
of the aggregate amount of the Commitments at such time or, if the Commitments
shall have been terminated in their entirety, holding Notes evidencing at least
66 2/3% of the aggregate unpaid principal amount of the Loans.
"Restricted Payment" means (a) the declaration or payment of any
dividend (in cash or property) on or in respect of any shares of any class of
capital stock of the Borrower, except dividends payable in capital stock of the
Borrower, (b) the purchase or other retirement of any shares, and of any option
or warrant or other right to purchase any shares, of any class of capital stock
of the Borrower, directly, or indirectly through a Subsidiary, or otherwise,
except for the purchase by the Borrower subsequent to November 1, 1994 of stock
options held by employees in an amount not to exceed $5,000,000 in the aggregate
and (c) the prepayment, redemption, retirement or purchase of Subordinated Debt
of the Borrower other than (i) at its scheduled maturity or (ii) in exchange for
equity securities (including options or warrants to purchase equity securities)
of the Borrower or other Subordinated Debt of the Borrower.
"Revolving Credit Period" means the period from and including the
Effective Date to but not including the Termination Date.
"S&P" has the meaning set forth in the Pricing Schedule.
"Significant Subsidiary" means at any time any Subsidiary or any
group of Subsidiaries having consolidated assets, individually or in the
aggregate, equal to or greater than 7% of the consolidated assets of the
Borrower and its Subsidiaries at such time.
"Xxxxx Family Group" means the group of persons party to the
Xxxxx-Xxxxx/Marks Stockholders Agreement dated as of December 29, 1986, as
amended (whether or not such agreement is terminated) and the progeny of each
such person.
"Subordinated Debt" means any unsecured Debt of the Borrower
which is by its terms subordinated in right of payment to the Notes.
"Subsidiary" means any corporation or other entity (i) of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Borrower (or, if such term
is used with reference to any other Person, by such Person) or (ii) a majority
of the equity interest in which shall at the time be owned directly
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or indirectly by the Borrower and which is a Consolidated Subsidiary as of such
time; provided that neither NMG nor any of its Subsidiaries shall be deemed to
be a Subsidiary of the Borrower.
"Termination Date" means December 16, 1999, or, if such day is
not a Euro-Dollar Business Day, the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in which
case the Termination Date shall be the next preceding Euro-Dollar Business Day.
"Total Adjusted Debt" means, at any date, an amount equal to (i)
the consolidated Debt of the Borrower and its Subsidiaries (excluding any such
Debt (other than short-term indebtedness for borrowed money or the current
portion of long-term Debt) which is a current liability of the Borrower or a
Subsidiary) at such date plus (ii) an amount equal to 800% of Rental Expense for
the period of four consecutive fiscal quarters most recently ended on or prior
to such date.
"Total Capitalization" means, at any date, the sum of Total
Adjusted Debt plus Adjusted Net Worth, each determined as of such date.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA Group
to the PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the
States and the District of Columbia, but excluding its territories and
possessions.
"Wholly-Owned Subsidiary" means any Subsidiary all of the shares
of capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred with by the
Borrower's independent public accountants) with the most recent audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries delivered to the Banks; provided that, if the Borrower notifies the
Documentation Agent that the Borrower wishes to amend any covenant in Article V
to eliminate the effect of any change in generally accepted accounting
principles on the operation of such covenant (or if the Documentation Agent
notifies the Borrower that the Required Banks wish to amend Article V for such
purpose), then the Borrower's compliance with such covenant shall be determined
on the basis of generally accepted accounting principles in effect immediately
before the relevant change in generally accepted accounting principles became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Borrower and the Required Banks.
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SECTION 1.03. Types of Borrowings. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrower
pursuant to Article II on a single date and for a single Interest Period.
Borrowings are classified for purposes of this Agreement either by reference to
the pricing of Loans comprising such Borrowing (e.g., a "Euro-Dollar Borrowing"
is a Borrowing comprised of Euro-Dollar Loans) or by reference to the provisions
of Article II under which participation therein is determined (i.e., a
"Committed Borrowing" is a Borrowing under Section 2.01 in which all Banks
participate in proportion to their Commitments, while a "Money Market Borrowing"
is a Borrowing under Section 2.03 in which the Bank participants are determined
on the basis of their bids in accordance therewith).
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. During the Revolving Credit
Period each Bank severally agrees, on the terms and conditions set forth in this
Agreement, to make loans to the Borrower pursuant to this Section from time to
time in amounts such that the aggregate principal amount of Committed Loans by
such Bank at any one time outstanding shall not exceed the amount of its
Commitment. Each Borrowing under this Section shall be in an aggregate principal
amount of $5,000,000 or any larger multiple of $1,000,000 (except that any such
Borrowing may be in the aggregate amount available in accordance with Section
3.02(b)) and shall be made from the several Banks ratably in proportion to their
respective Commitments. Within the foregoing limits, the Borrower may borrow
under this Section , repay, or to the extent permitted by Section 2.11, prepay
Loans and reborrow at any time during the Revolving Credit Period under this
Section.
SECTION 2.02. Notice of Committed Borrowings. The Borrower shall
give the Administrative Agent notice (a "Notice of Committed Borrowing") not
later than 11:00 A.M. (Boston, Massachusetts time) on (x) the date of each Base
Rate Borrowing, (y) the second Domestic Business Day before each CD Borrowing
and (z) the third Euro-Dollar Business Day before each Euro-Dollar Borrowing,
specifying:
(a) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Domestic Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing,
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to be CD
Loans, Base Rate Loans or Euro-Dollar Loans, and
(d) in the case of a Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
SECTION 2.03. Money Market Borrowings.
(a) The Money Market Option. In addition to Committed Borrowings
pursuant to Section 2.01, the Borrower may, as set forth in this Section ,
request the Banks during the Revolving Credit Period to make offers to make
Money Market Loans to the Borrower. The Banks may, but shall have no
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obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this Section.
(b) Money Market Quote Request. When the Borrower wishes to
request offers to make Money Market Loans under this Section , it shall transmit
to the Administrative Agent by telex or facsimile transmission a Money Market
Quote Request substantially in the form of Exhibit B hereto so as to be received
no later than 11:00 A.M. (Boston, Massachusetts time) on (x) the fourth
Euro-Dollar Business Day prior to the date of Borrowing proposed therein, in the
case of a LIBOR Auction or (y) the Domestic Business Day next preceding the date
of Borrowing proposed therein, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Administrative
Agent shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be a Euro-Dollar
Business Day in the case of a LIBOR Auction or a Domestic Business Day
in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$5,000,000 or a larger multiple of $1,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth a
Money Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Administrative Agent may agree) of any
other Money Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt of
a Money Market Quote Request, the Administrative Agent shall send to the Banks
by telex or facsimile transmission an Invitation for Money Market Quotes
substantially in the form of Exhibit C hereto, which shall constitute an
invitation by the Borrower to each Bank to submit Money Market Quotes offering
to make the Money Market Loans to which such Money Market Quote Request relates
in accordance with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each Bank
may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Administrative Agent by telex or facsimile transmission at
its offices referred to in Section 9.01 not later than (x) 4:00 P.M. (Boston,
Massachusetts time) on the fourth Euro-Dollar Business Day prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or (y) 9:15 A.M. (Boston,
Massachusetts time) on the proposed date of Borrowing, in the case of an
Absolute Rate Auction (or, in either case, such other time or date as the
Borrower and the Administrative Agent shall have mutually agreed and shall have
notified to the Banks not later than the date of the Money Market Quote Request
for the first LIBOR Auction or Absolute Rate Auction for which such change is to
be effective); provided that Money Market Quotes submitted by the Administrative
Agent (or any affiliate of the Administrative
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Agent) in the capacity of a Bank may be submitted, and may only be submitted, if
the Administrative Agent or such affiliate notifies the Borrower of the terms of
the offer or offers contained therein not later than (x) 3:00 P.M. (Boston,
Massachusetts time), in the case of a LIBOR Auction or (y) 9:00 A.M. (Boston,
Massachusetts time), in the case of an Absolute Rate Auction. Subject to
Articles III and VI, any Money Market Quote so made shall be irrevocable except
with the written consent of the Administrative Agent given on the instructions
of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for which each
such offer is being made, which principal amount (w) may be greater
than or less than the Commitment of the quoting Bank, (x) must be
$5,000,000 or a larger multiple of $1,000,000, (y) may not exceed the
principal amount of Money Market Loans for which offers were requested
and (z) may be subject to an aggregate limitation as to the principal
amount of Money Market Loans for which offers being made by such
quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable London Interbank Offered Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or
subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest
per annum (specified to the nearest 1/10,000th of 1%) (the "Money
Market Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto or
does not specify all of the information required by subsection (d)(ii);
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) Notice to Borrower. The Administrative Agent shall promptly
notify the Borrower of the terms (x) of any Money Market Quote submitted by a
Bank that is in accordance with subsection (d) and (y) of any Money Market Quote
that amends, modifies or is otherwise inconsistent with a previous Money Market
Quote submitted by such Bank with respect to the same Money Market Quote
Request. Any such subsequent Money Market Quote shall be
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disregarded by the Administrative Agent unless such subsequent Money Market
Quote is submitted solely to correct a manifest error in such former Money
Market Quote. The Administrative Agent's notice to the Borrower shall specify
(A) the aggregate principal amount of Money Market Loans for which offers have
been received for each Interest Period specified in the related Money Market
Quote Request, (B) the respective principal amounts and Money Market Margins or
Money Market Absolute Rates, as the case may be, so offered and (C) if
applicable, limitations on the aggregate principal amount of Money Market Loans
for which offers in any single Money Market Quote may be accepted.
(f) Acceptance and Notice by Borrower. Not later than 10:00 A.M.
(Boston, Massachusetts time) on (x) the third Euro-Dollar Business Day prior to
the proposed date of Borrowing, in the case of a LIBOR Auction or (y) the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Administrative
Agent shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective), the Borrower
shall notify the Administrative Agent of its acceptance or non-acceptance of the
offers so notified to it pursuant to subsection (e). In the case of acceptance,
such notice (a "Notice of Money Market Borrowing") shall specify the aggregate
principal amount of offers for each Interest Period that are accepted. The
Borrower may accept any Money Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market Borrowing
may not exceed the applicable amount set forth in the related Money
Market Quote Request,
(ii) the principal amount of each Money Market Borrowing must
be $5,000,000 or a larger multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as the
case may be, and
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Administrative Agent. If offers are made by two
or more Banks with the same Money Market Margins or Money Market Absolute Rates,
as the case may be, for a greater aggregate principal amount than the amount in
respect of which such offers are accepted for the related Interest Period, the
principal amount of Money Market Loans in respect of which such offers are
accepted shall be allocated by the Administrative Agent among such Banks as
nearly as possible (in multiples of $1,000,000, as the Administrative Agent may
deem appropriate) in proportion to the aggregate principal amounts of such
offers. Determinations by the Administrative Agent of the amounts of Money
Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans.
(a) Upon receipt of a Notice of Borrowing, the Administrative
Agent shall promptly notify each Bank of the contents thereof and of such Bank's
share (if any) of such Borrowing and such Notice of Borrowing shall not
thereafter be revocable by the Borrower.
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(b) Not later than 12:00 Noon (Boston, Massachusetts time) on the
date of each Borrowing, each Bank participating therein shall (except as
provided in subsection (c) of this Section ) make available its share of such
Borrowing, in Federal or other funds immediately available in Boston,
Massachusetts to the Administrative Agent at its address referred to in Section
9.01. Unless the Administrative Agent determines that any applicable condition
specified in Article III has not been satisfied, the Administrative Agent will
make the funds so received from the Banks available to the Borrower at the
Administrative Agent's aforesaid address.
(c) If any Bank makes a new Loan hereunder on a day on which the
Borrower is to repay all or any part of an outstanding Loan from such Bank, such
Bank shall apply the proceeds of its new Loan to make such repayment and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount being repaid shall be made available by such Bank to the
Administrative Agent as provided in subsection (b), or remitted by the Borrower
to the Administrative Agent as provided in Section 2.12, as the case may be.
(d) Unless the Administrative Agent shall have received notice
from a Bank prior to the date of any Borrowing that such Bank will not make
available to the Administrative Agent such Bank's share of such Borrowing, the
Administrative Agent may assume that such Bank has made such share available to
the Administrative Agent on the date of such Borrowing in accordance with
subsections (b) and (c) of this Section 2.04 and the Administrative 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 Administrative Agent, such Bank and, if such Bank
shall have failed to do so within four Domestic Business Days of demand by the
Administrative Agent therefor (a copy of which shall be simultaneously given to
the Borrower), the Borrower severally agree to repay to the Administrative 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 Administrative Agent, at the Federal Funds
Rate. If such Bank shall repay to the Administrative Agent such corresponding
amount, such amount so repaid shall constitute such Bank's Loan included in such
Borrowing for purposes of this Agreement.
SECTION 2.05. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the account of
its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the
Documentation Agent, request that its Loans of a particular type be evidenced by
a separate Note in an amount equal to the aggregate unpaid principal amount of
such Loans. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely Loans of the relevant type. Each reference in this Agreement to the
"Note" of such Bank shall be deemed to refer to and include any or all of such
Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant to Section 3.01(b),
the Documentation Agent shall forward such Note to such Bank. Each Bank shall
record the date, amount, type and maturity of each Loan made by it and the date
and amount of each payment of principal made by the Borrower with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part
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thereof appropriate notations to evidence the foregoing information with respect
to each such Loan then outstanding; provided that the failure of any Bank to
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Notes. Each Bank is hereby irrevocably
authorized by the Borrower so to endorse its Note and to attach to and make a
part of its Note a continuation of any such schedule as and when required.
SECTION 2.06. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due, at a rate per annum equal to the Base
Rate for such day. Such interest shall be payable for each Interest Period on
the last day thereof. Any overdue principal of or interest on any Base Rate Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the sum of 2% plus the rate otherwise applicable to Base Rate
Loans for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during the Interest Period applicable thereto, at a
rate per annum equal to the sum of the CD Margin for such day plus the
applicable Adjusted CD Rate for such Interest Period; provided that if any CD
Loan shall, as a result of clause (2)(b) of the definition of Interest Period,
have an Interest Period of less than 30 days, such CD Loan shall bear interest
during such Interest Period at the rate applicable to Base Rate Loans during
such period. Such interest shall be payable for each Interest Period on the last
day thereof and, if such Interest Period is longer than 90 days, at intervals of
90 days after the first day thereof. Any overdue principal of or interest on any
CD Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the sum of 2% plus the higher of (i) the sum of the CD
Margin for such day plus the Adjusted CD Rate applicable to such Loan and (ii)
the rate applicable to Base Rate Loans for such day.
"CD Margin" means a rate per annum determined in accordance with
the Pricing Schedule.
The "Adjusted CD Rate" applicable to any Interest Period means a
rate per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
-------------
* The amount in brackets being rounded upward, if necessary, to the
next higher 1/100 of 1%
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The "CD Base Rate" applicable to any Interest Period is the rate
of interest determined by the Administrative Agent to be the average (rounded
upward, if necessary, to the next higher 1/100 of 1%) of the prevailing rates
per annum bid at 10:00 A.M. (Boston, Massachusetts time) (or as soon thereafter
as practicable) on the first day of such Interest Period by two or more New York
certificate of deposit dealers of recognized standing for the purchase at face
value from each CD Reference Bank of its certificates of deposit in an amount
comparable to the principal amount of the CD Loan of such CD Reference Bank to
which such Interest Period applies and having a maturity comparable to such
Interest Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in Boston, Massachusetts with deposits exceeding five billion
dollars in respect of new non-personal time deposits in dollars in Boston,
Massachusetts having a maturity comparable to the related Interest Period and in
an amount of $100,000 or more. The Adjusted CD Rate shall be adjusted
automatically on and as of the effective date of any change in the Domestic
Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in
effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.3(e) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's) insuring time deposits at offices of such institution in the United
States. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for such
day plus the applicable London Interbank Offered Rate for such Interest Period.
Such interest shall be payable for each Interest Period on the last day thereof
and, if such Interest Period is longer than three months, at intervals of three
months after the first day thereof.
"Euro-Dollar Margin" means a rate per annum determined in
accordance with the Pricing Schedule.
The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London inter- bank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal to
the principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank
to which such Interest Period is to apply and for a period of time comparable to
such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day from and including the date
payment thereof was due to but excluding the date of actual payment, at a rate
per annum equal to the sum of 2% plus the higher of (i) the sum of the
Euro-Dollar Margin for such day plus the London Interbank Offered Rate
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applicable to such Loan and (ii) the rate applicable to Base Rate Loans for such
day.
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of the
London Interbank Offered Rate for such Interest Period (determined in accordance
with Section 2.07(c) as if the related Money Market LIBOR Borrowing were a
Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin quoted
by the Bank making such Loan in accordance with Section 2.03. Each Money Market
Absolute Rate Loan shall bear interest on the outstanding principal amount
thereof, for the Interest Period applicable thereto, at a rate per annum equal
to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.03. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
(f) The Administrative Agent shall determine each interest rate
applicable to the Loans hereunder. The Administrative Agent shall give prompt
notice to the Borrower and the participating Banks of each rate of interest so
determined, and its determination thereof shall be conclusive in the absence of
manifest error.
(g) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Administrative Agent as contemplated by this Section . If any
Reference Bank does not furnish a timely quotation, the Administrative Agent
shall determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Banks or, if none of
such quotations is available on a timely basis, the provisions of Section 8.01
shall apply.
SECTION 2.08. Facility Fee. The Borrower shall pay to the
Administrative Agent for the account of the Banks ratably in proportion to their
respective Commitments a facility fee at a rate per annum equal to the Facility
Fee Rate (determined daily in accordance with the Pricing Schedule). Such
facility fee shall accrue (i) from and including the Effective Date to but
excluding the Termination Date (or earlier date of termination of the
Commitments in their entirety), on the daily aggregate amount of the Commitments
(whether used or unused) and (ii) from and including the Termination Date (or
earlier date of termination of the Commitments in their entirety) to but
excluding the date the Loans shall be repaid in their entirety, on the daily
average aggregate outstanding principal amount of the Loans. Accrued fees under
this Section shall be payable quarterly on each March 1, June 1, September 1 and
December 1 prior to the Termination Date and upon the date of termination of the
Commitments in their entirety (and, if later, the date the Loans shall be repaid
in their entirety).
SECTION 2.09. Optional Termination or Reduction of Commitments.
During the Revolving Credit Period, the Borrower may, upon at least three
Domestic Business Days' notice to the Administrative Agent, (i) terminate the
Commitments at any time, if no Loans are outstanding at such time or (ii)
ratably reduce from time to time by an aggregate amount of $25,000,000 or any
larger multiple thereof, the aggregate amount of the Commitments in excess of
the aggregate outstanding principal amount of the Loans.
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SECTION 2.10. Scheduled Termination of Commitments. The
Commitments shall terminate on the Termination Date, and any Loans then
outstanding (together with accrued interest thereon) shall be due and payable on
such date.
SECTION 2.11. Optional Prepayments. (a) The Borrower may (i) upon
at least one Domestic Business Day's notice to the Administrative Agent, prepay
any Domestic Borrowing (or any Money Market Borrowing bearing interest at the
Base Rate pursuant to Section 8.01(a)) or (ii) subject to Section 2.13, upon at
least three Euro-Business Days' notice to the Administrative Agent, prepay any
Euro-Dollar Borrowing, in whole at any time, or from time to time in part in
amounts aggregating $5,000,000 or any larger multiple of $1,000,000, by paying
the principal amount to be prepaid together with accrued interest thereon to the
date of prepayment. Each such optional prepayment shall be applied to prepay
ratably the Loans of the several Banks included in such Borrowing.
(b) Except as provided in clause (i) of Section 2.11(a), the
Borrower may not prepay all or any portion of the principal amount of any Money
Market Loan prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this
Section , the Administrative Agent shall promptly notify each Bank of the
contents thereof and of such Bank's ratable share (if any) of such prepayment
and such notice shall not thereafter be revocable by the Borrower.
SECTION 2.12. General Provisions as to Payments. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 12:00 Noon (Boston, Massachusetts time) on the date
when due, in Federal or other funds immediately available in Boston,
Massachusetts, to the Administrative Agent at its address referred to in Section
9.01. The Administrative Agent will promptly distribute to each Bank its ratable
share of each such payment received by the Administrative Agent for the account
of the Banks. Whenever any payment of principal of, or interest on, the Domestic
Loans or of fees shall be due on a day which is not a Domestic Business Day, the
date for payment thereof shall be extended to the next succeeding Domestic
Business Day. Whenever any payment of principal of, or interest on, the
Euro-Dollar Loans shall be due on a day which is not a Euro-Dollar Business Day,
the date for payment thereof shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in another
calendar month, in which case the date for payment thereof shall be the next
preceding Euro-Dollar Business Day. Whenever any payment of principal of, or
interest on, the Money Market Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day. If the date for any payment of
principal is extended by operation of law or otherwise, interest thereon shall
be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Banks
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such due
date an amount equal to the amount then due such Bank. If and to the extent that
the Borrower shall not have so made such payment, each Bank shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Bank
together with interest thereon, for each day from the date such
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amount is distributed to such Bank until the date such Bank repays such amount
to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If the Borrower makes any payment
of principal with respect to any Fixed Rate Loan (pursuant to Article II or VI
or otherwise, but not including Article VIII) on any day other than the last day
of the Interest Period applicable thereto, or if the Borrower fails to borrow or
prepay any Fixed Rate Loans after notice has been given to any Bank in
accordance with Section 2.04(a) or 2.11(c), the Borrower shall reimburse each
Bank within 15 days after demand for any resulting loss or expense incurred by
it (or by an existing or prospective Participant in the related Loan), including
(without limitation) any loss incurred in obtaining, liquidating or employing
deposits from third parties, but excluding loss of margin for the period after
any such payment or failure to borrow or prepay, provided that such Bank shall
have delivered to the Borrower a certificate as to the amount of such loss or
expense, which certificate shall be conclusive in the absence of clearly
demonstrable error. Each such certificate shall be accompanied by such
information as the Borrower may reasonably request as to the computation set
forth therein.
SECTION 2.14. Computation of Interest and Fees. Interest based on
the Prime Rate hereunder shall be computed on the basis of a year of 365 days
(or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. Regulation D Compensation. For so long as any Bank
maintains reserves against "Eurocurrency liabilities" (or any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of such Bank to United
States residents), and as a result the cost to such Bank (or its Euro-Dollar
Lending Office) of making or maintaining its Euro-Dollar Loans is increased,
then such Bank may require the Borrower to pay, contemporaneously with each
payment of interest on the Euro-Dollar Loans, additional interest on the related
Euro-Dollar Loan of such Bank at a rate per annum up to but not exceeding the
excess of (i) (A) the applicable London Interbank Offered Rate divided by (B)
one minus the Euro-Dollar Reserve Percentage over (ii) the rate specified in
clause (i)(A). Any Bank wishing to require payment of such additional interest
(x) shall so notify the Borrower and the Administrative Agent, in which case
such additional interest on the Euro-Dollar Loans of such Bank shall be payable
to such Bank at the place indicated in such notice with respect to each Interest
Period commencing at least three Euro-Dollar Business Days after the giving of
such notice and (y) shall furnish to the Borrower at least three Euro-Dollar
Business Days prior to each date on which interest is payable on the Euro-Dollar
Loans an officer's certificate setting forth the amount to which such Bank is
then entitled under this Section (which shall be consistent with such Bank's
good faith estimate of the level at which the related reserves are maintained by
it). Each such certificate shall be accompanied by such information as the
Borrower may reasonably request as to the computation set forth therein.
SECTION 2.16. Replacement of Banks. The Borrower shall have the
right, from time to time, with the assistance of the Documentation Agent or the
Administrative Agent, to substitute a bank or banks (which may be one or more of
the Banks) for any Bank whose participation hereunder the Borrower shall have
determined (in its discretion) to terminate.
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ARTICLE III
CONDITIONS
SECTION 3.01. 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 9.05):
(a) receipt by the Documentation 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 Documentation Agent in form satisfactory to it of telegraphic,
telex or other written confirmation from such party of execution of a
counterpart hereof by such party);
(b) receipt by the Documentation Agent for the account of each
Bank of a duly executed Note dated on or before the Effective Date
complying with the provisions of Section 2.05;
(c) receipt by the Documentation Agent of an opinion of the
General Counsel of the Borrower, given upon the express instruction of
the Borrower, substantially in the form of Exhibit E hereto and
covering such additional matters relating to the transactions
contemplated hereby as the Required Banks may reasonably request;
(d) receipt by the Documentation Agent of an opinion of Xxxxx
Xxxx & Xxxxxxxx, special counsel for the Agents, substantially in the
form of Exhibit F hereto and covering such additional matters relating
to the transactions contemplated hereby as the Required Banks may
reasonably request;
(e) receipt by the Documentation Agent of all documents it may
reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Agreement and the
Notes, and any other matters relevant hereto, all in form and substance
satisfactory to the Documentation Agent; and
(f) receipt by the Documentation Agent of evidence satisfactory
to it of the payment of all principal of and interest on any loans
outstanding under, and of all other amounts payable under, the Existing
Credit Agreement;
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
December 30, 1994. The Documentation Agent shall promptly notify the Borrower
and the Banks of the Effective Date, and such notice shall be conclusive and
binding on all parties hereto. The Banks that are parties to the Existing Credit
Agreement, comprising the "Required Banks" as defined therein, and the Borrower
agree that the commitments under the Existing Credit Agreement shall terminate
in their entirety simultaneously with and subject to the effectiveness of this
Agreement and that the Borrower shall be obligated to pay the accrued commitment
and facility fees thereunder to but excluding the date of such effectiveness.
SECTION 3.02. Borrowings. The obligation of any Bank to make
a Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
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(a) receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.02 or 2.03, as the case may be;
(b) the fact that, immediately after such Borrowing, the
aggregate outstanding principal amount of the Loans will not exceed the
aggregate amount of the Commitments;
(c) the fact that, immediately after such Borrowing, no
Default shall have occurred and be continuing; and
(d) the fact that the representations and warranties of the
Borrower contained in this Agreement (other than, in the case of a
Refunding Borrowing, the representations and warranties set forth in
Sections 4.04(c) and 4.05, which need not be true if the matter which
would make them untrue has theretofore been disclosed in writing by the
Borrower to the Banks) shall be true in all material respects on and as
of the date of such Borrowing.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the facts specified in clauses
(b), (c) and (d) of this Section .
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower and
each Significant Subsidiary is a corporation duly organized, validly existing
and in good standing under the laws of the state of its incorporation, has all
power and authority to carry on its business as now being conducted and to own
its properties, and is duly qualified and in good standing as a foreign
corporation in each other jurisdiction in which the failure to qualify would
materially and adversely affect the conduct of its business or the
enforceability of its contractual rights.
SECTION 4.02. Corporate Authorization. The execution, delivery
and performance by the Borrower of this Agreement and the Notes are within the
Borrower's corporate power, have been duly authorized by all necessary corporate
action and will not contravene, or constitute a default under, any provision of
applicable law or regulation or of the Restated Certificate of Incorporation or
By-Laws of the Borrower, or of any judgment, order, decree, agreement or
instrument binding on the Borrower or result in the creation of any Lien upon
any of its property or assets.
SECTION 4.03. Binding Effect. This Agreement constitutes, and the
Notes when duly executed on behalf of the Borrower and delivered in accordance
with this Agreement will constitute, the valid and binding obligations of the
Borrower, enforceable in accordance with their respective terms.
SECTION 4.04. Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of October 31, 1993 and the related consolidated
statements of income and cash flows for the fiscal year then ended, reported
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on by Deloitte & Touche and set forth in the Borrower's 1993 Form 10-K, a copy
of which has been delivered to each of the Banks, fairly present, in conformity
with generally accepted accounting principles, the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such date and
their consolidated results of operations and cash flows for such fiscal year.
(b) The unaudited consolidated balance sheet of the Borrower and
its Consolidated Subsidiaries as of July 31, 1994 and the related unaudited
consolidated statements of income and cash flows for the nine months then ended,
set forth in the Borrower's quarterly report for the fiscal quarter ended July
31, 1994 as filed with the Securities and Exchange Commission on Form 10-Q, a
copy of which has been delivered to each of the Banks, fairly present, in
conformity with generally accepted accounting principles applied on a basis
consistent with the financial statements referred to in subsection (a) of this
Section , the consolidated financial position of the Borrower and its
Consolidated Subsidiaries as of such date and their consolidated results of
operations and cash flows for such nine-month period (subject to normal year-end
adjustments).
(c) Since July 31, 1994, there has been no material adverse
change in the business, financial position or results of operations of the
Borrower and its Consolidated Subsidiaries, considered as a whole.
SECTION 4.05. Litigation. There are no actions, suits or
proceedings pending against or, to the knowledge of the Borrower, threatened
against or affecting, the Borrower or any Significant Subsidiary in any court or
before or by any governmental department, agency or instrumentality, in which
there is a reasonable possibility of an adverse decision which would materially
and adversely affect the financial condition or business of the Borrower and its
Subsidiaries, taken as a whole.
SECTION 4.06. Governmental and Other Approvals. No approval,
consent or authorization of or filing or registration with any governmental
authority or body is necessary for the execution, delivery or performance by the
Borrower of this Agreement or the Notes or for the performance by the Borrower
of any of the terms or conditions hereof or thereof.
SECTION 4.07. Full Disclosure. All financial statements and other
documents furnished by the Borrower to the Banks in connection with this
Agreement do not and will not contain any untrue statement of material fact or
omit to state a material fact necessary in order to make the statements
contained therein not misleading. The Borrower has disclosed to the Banks in
writing any and all facts which materially and adversely affect the business,
operations or condition, financial or otherwise, of the Borrower and its
Subsidiaries or the Borrower's ability to perform its obligations under this
Agreement.
SECTION 4.08. Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the minimum funding standards of ERISA
and the Internal Revenue Code with respect to each Plan and is in compliance in
all material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal
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Revenue Code or (iii) incurred any liability under Title IV of ERISA other than
a liability to the PBGC for premiums under Section 4007 of ERISA.
SECTION 4.09. Taxes. United States Federal income tax returns of
the Borrower and its Subsidiaries have been examined and closed through the
fiscal year ended October 31, 1988. The Borrower and its Subsidiaries have filed
all United States Federal income tax returns, and the Borrower and its
Significant Subsidiaries have filed all other material tax returns, which are
required to be filed by them and have paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Borrower or any
Significant Subsidiary except where the payment of any such taxes is being
contested in good faith by appropriate proceedings. The charges, accruals and
reserves on the books of the Borrower and its Consolidated Subsidiaries in
respect of taxes or other governmental charges are, in the opinion of the
Borrower, adequate.
SECTION 4.10. Environmental Matters. The Borrower has reasonably
concluded that the costs of compliance with Environmental Laws are unlikely to
have a material adverse effect on the business, financial condition, results of
operations or prospects of the Borrower and its Consolidated Subsidiaries,
considered as a whole.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Furnishing of Financial Data and Certificates.
The Borrower will deliver to each of the Banks:
(a) As soon as practicable, and in any event within 75 days after
the close of each of the first three quarters of each fiscal year of the
Borrower, (i) the consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as at the end of such quarter, (ii) the consolidated
statement of income and retained earnings of the Borrower and its Consolidated
Subsidiaries for such quarter and for the portion of such fiscal year to and
including such quarter and (iii) the consolidated statement of cash flows of the
Borrower and its Consolidated Subsidiaries for the portion of such fiscal year
to and including such quarter, each of the foregoing to set forth in comparative
form the corresponding figures of the previous year and to be in reasonable
detail and certified by the principal accounting officer of the Borrower,
subject to year-end audit adjustments; delivery by the Borrower of its Quarterly
Reports on Form 10-Q shall be deemed compliance with this provision;
(b) As soon as practicable, and in any event within 120 days
after the close of each fiscal year of the Borrower, (i) the consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as at the end of
such fiscal year, (ii) the consolidated statement of income and retained
earnings of the Borrower and its Consolidated Subsidiaries for such fiscal year
and (iii) the consolidated statement of cash flows of the Borrower and its
Consolidated Subsidiaries for such fiscal year, each of the foregoing to set
forth in comparative form the corresponding figures of the previous year and to
be in reasonable detail and audited and certified by Deloitte & Touche or other
certified public accountants of nationally recognized standing reasonably
satisfactory to the Banks; delivery by the Borrower of its Annual
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Reports on Form 10-K (together with its annual report to shareholders, if
incorporated by reference therein) shall be deemed compliance with this
provision;
(c) Promptly after sending or filing, copies of all financial
statements, reports, notices and proxy statements as it shall send to its
shareholders, and of all periodic reports filed by the Borrower with any
securities exchange or with the Securities and Exchange Commission or any
governmental authority succeeding to any of its functions; and
(d) Such other information (which is readily obtainable by the
Borrower without incurring any undue expense) regarding the financial condition
of the Borrower as any Bank may reasonably request.
Together with each delivery of financial statements required by
clauses (a) and (b) above, the Borrower will deliver to the Banks a certificate
of its principal accounting officer stating that to the best of his knowledge
there exists no Default or, if any Default exists, specifying the nature
thereof, the period of existence thereof and what action the Borrower proposes
to take with respect thereto. The certificate delivered in conjunction with each
delivery of annual and quarterly financial statements shall in addition
demonstrate in reasonable detail compliance during the preceding fiscal period
with Sections 5.08, 5.09, 5.10, 5.11(j), 5.12 and 5.13(u).
Each certificate of independent certified public accountants
delivered with the financial statements required by clause (b) above shall be
accompanied by a written statement of such accountants that, in conducting the
examination necessary to the giving of such certificate, they have obtained no
knowledge of the existence during the fiscal period under examination of any
condition, event or act which constitutes a Default (insofar as such a
condition, event or act relates to accounting matters), or if in the opinion of
such accountants there shall exist any Default, such statement shall specify the
nature thereof.
SECTION 5.02. Payment of Taxes. The Borrower will, and will cause
each Subsidiary to, promptly pay and discharge, or cause to be paid and
discharged, when due and payable, all lawful taxes, assessments and governmental
charges or levies imposed upon the income, profits, property or business of the
Borrower or any Subsidiary, provided, however, that any such tax, assessment,
charge or levy need not be paid if the validity thereof shall currently be
contested in good faith and if the Borrower or a Subsidiary shall have set aside
on its books adequate reserves with respect thereto in accordance with generally
accepted accounting principles.
SECTION 5.03. Maintenance of Corporate Existence. The Borrower
will preserve and maintain its corporate existence and will, and will cause each
Subsidiary to, conduct its affairs and carry on its business and operations in
such manner as to comply with any and all applicable laws not being contested in
good faith.
SECTION 5.04. Maintenance of Property and Leases. The Borrower
will, and will cause each Subsidiary to, keep its properties, whether owned or
leased, in satisfactory repair, working order and condition.
SECTION 5.05. Insurance. The Borrower will, and will cause each
Subsidiary to, maintain with financially sound and reputable insurers insurance
against liability to persons and damage to property to the extent and in the
manner customary for companies of like size in similar businesses,
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it being understood that the Borrower may self-insure against exposures which,
in the judgment of its management, are reasonable in relation to its financial
position. The Borrower will deliver to the Banks from time to time upon request
of any Bank through the Administrative Agent full information as to the
insurance so carried.
SECTION 5.06. Accounts and Reports. The Borrower will, and will
cause each Subsidiary to, keep true records and books of account in which full,
true and correct entries will be made of all dealings or transactions in
relation to its businesses and affairs, in accordance with generally accepted
accounting principles consistently applied.
SECTION 5.07. Inspection. Each Bank or its designee shall have
the right, at its expense, on reasonable notice (given to a senior financial
officer of the Borrower) and at reasonable times to visit and inspect the
properties of the Borrower and its Subsidiaries and to discuss the financial
affairs of the Borrower and its Subsidiaries with the Borrower's senior officers
and will be furnished from the books of the Borrower and its Subsidiaries such
financial information as it may reasonably request and upon such reasonable
conditions relating to confidentiality of the material and information so
supplied as the Borrower might impose. Each Bank shall respect the confidential
nature of the material and information so supplied and shall take reasonable
measures to preserve such confidentiality. It is understood that a Bank may be
required to disclose such confidential material and information or portions
thereof (1) at the request of a bank regulatory agency or in connection with an
examination of the Bank by bank examiners, (2) pursuant to subpoena or other
court process, (3) at the express direction of any other authorized government
agency, (4) to its independent auditors or (5) otherwise as required by law.
SECTION 5.08. Maintenance of Net Worth. Adjusted Net Worth will
at all times be equal to or greater than the Compliance Level. For this purpose,
the "Compliance Level" is an amount initially equal to $800,000,000; the
Compliance Level shall be increased effective at the end of each fiscal year of
the Borrower commencing after October 31, 1994 by an amount equal to 50% of
Consolidated Net Income for such year, but as to any particular year only if
Consolidated Net Income for such year is a positive amount. The Compliance Level
shall at no time decrease on account of a negative amount of Consolidated Net
Income for any year.
SECTION 5.09. Coverage of Consolidated Fixed Charges. The ratio
of (i) Adjusted Consolidated Net Income for each period of four consecutive
fiscal quarters, commencing with the four quarters ending January 31, 1995, to
(ii) Consolidated Fixed Charges for such period will be equal to or greater than
1.60 to 1.
SECTION 5.10. Leverage Ratio. The Leverage Ratio will at no time
exceed 60%.
SECTION 5.11. Restrictions on Liens. The Borrower will not, nor
will it permit any Subsidiary to, create, incur, assume or suffer to exist any
Lien upon any of its property or assets now owned or hereafter acquired, except:
(a) Liens existing on the date hereof securing Debt outstanding
on the date hereof;
(b) Liens incidental to the conduct of its business or the
ownership of its properties and assets which were not incurred in
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connection with the borrowing of money or the obtaining of advances or
credit or the incurrence of Derivatives Obligations and which do not
materially detract from the value of its property or assets or
materially impair the use thereof in the operation of its business;
(c) any Lien on any asset securing Debt incurred or assumed for
the purpose of financing all or any part of the cost of acquiring such
asset, provided that such Lien attaches to such asset concurrently with
or within 90 days after the acquisition thereof;
(d) Liens incurred in connection with the making of the type of
Investment described in Section 5.13(t) and Liens incurred in
connection with the acquisition of, or improvements to, real estate;
provided, however, that no such Lien shall extend to or cover any
property other than the property so acquired or improved;
(e) any Lien existing on any assets of any corporation or other
entity at the time it becomes a Subsidiary and not created in
contemplation of such corporation becoming a Subsidiary, or existing on
any assets acquired by the Borrower or any Subsidiary through purchase,
merger, consolidation, or otherwise and not created in contemplation of
such purchase, merger, consolidation or other transaction;
(f) any Lien resulting from any order of attachment, distraint or
other legal process arising out of judicial proceedings so long as the
execution or other enforcement thereof is effectively stayed;
(g) Liens on shares of capital stock or property of a Subsidiary
securing obligations owing by such Subsidiary to the Borrower or to
another Subsidiary;
(h) Liens arising out of the refinancing, extension, renewal or
refunding of any Debt secured by any Lien permitted by this Section
5.11, provided that such Debt is not increased and is not secured by
any additional assets;
(i) Liens to banks or other institutions arising in connection
with the issuance of letters of credit or bankers' acceptances in
connection with the shipment or storage of goods in the ordinary course
of business;
(j) Liens not otherwise permitted by any of the foregoing clauses
of this Section 5.11 securing Debt in an aggregate principal amount at
any time outstanding not to exceed 10% of Adjusted Net Worth; and
(k) 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 $50,000,000.
SECTION 5.12. Restricted Payments. The Borrower will not make any
Restricted Payment unless, after giving effect to such action, the sum of (a)
$250,000,000, (b) 75% of Consolidated Net Income for the period from November 1,
1994 to the end of the quarter prior to such Restricted Payment, and (c) the
cash proceeds from the sale of equity securities of the Borrower (including
options and warrants to purchase such equity securities) and Subordinated Debt
subsequent to October 31, 1994 exceeds the sum of all Restricted Payments
subsequent to October 31, 1994.
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SECTION 5.13. Investments. Neither the Borrower nor any
Subsidiary will make, purchase, own or have outstanding any Investments or
Guarantee any Debt or other obligations, stock or dividends of any other Person,
except:
(a) Loans and advances by the Borrower to any Subsidiary or loans
and advances between Subsidiaries or by any Subsidiary to the Borrower;
(b) Investments existing as of October 31, 1994, including
without limitation Investments in the capital stock of NMG;
(c) Loans and advances by the Borrower to NMG and Guarantees by
the Borrower of Debt of NMG; provided, however, that the aggregate
amount of all such loans, advances and guarantees shall not exceed
$250,000,000 at any time outstanding;
(d) Investments in direct obligations of or obligations
guaranteed by the United States of America or any agency or
instrumentality thereof;
(e) Investments in municipal obligations, municipal auction
preferred stock and asset backed securities, provided, however, that
any such instrument shall be rated, at the time of investment, a
minimum rating of AAA by S&P and/or AAA by Xxxxx'x, or the equivalent
short-term municipal ratings of SP1+ by S&P or MIGI by Xxxxx'x;
(f) Investments in certificates of deposit; time deposits; money
market funds; and bankers' acceptances issued by any United States
commercial bank (or branch thereof) or issued by any foreign bank (or
branch thereof) or a bank holding company having at the time of
investment capital and surplus of at least $100,000,000, provided,
however, that any such banking instruments shall be rated, at the time
of investment, a Thomson BankWatch rating of B/C or better;
(g) Investments in commercial paper issued by any corporation and
rated at the time of investment a minimum rating of A1 or better by S&P
or P1 or better by Xxxxx'x and, in either case, maturing within 270
days after the date of the acquisition thereof;
(h) Investments in auction rate preferred stock and fixed rate or
adjustable rate bonds or notes, provided, however, that any such
instrument shall be rated, at the time of investment, a minimum rating
of A- by S&P and/or A3 by Xxxxx'x;
(i) Repurchase agreements provided that such investments (i) are
made through primary U.S. Government dealers who, at the time of
investment, have a minimum commercial paper rating of A1 by S&P or P1
by Xxxxx'x, (ii) are collateralized on a daily basis at a minimum level
of 102% by direct obligations of the United States of America or any
agency or instrumentality thereof and (iii) mature within one year from
the time of investment;
(j) Subject to the provisions of Section 5.12, purchases,
redemptions, or other retirements of any of the Borrower's securities
through the issuance of stock or the sale of treasury stock in exchange
for such securities, or with the proceeds of any issuance of stock or
sale of treasury stock within 180 days after the receipt of such
proceeds;
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(k) Loans to key executive personnel for the purpose of
purchasing common stock of the Borrower under the terms of the
Borrower's Key Executive Stock Purchase Plan, provided that the
aggregate amount of such loans at any time outstanding shall not exceed
$5,000,000;
(l) Advances to employees of the Borrower or its Subsidiaries for
moving and travel expenses, drawing accounts and similar expenditures
in the ordinary course of their employment;
(m) The extension of credit, reflected, in accordance with
generally accepted accounting principles, as accounts receivable
(including notes, drafts, credit card transactions, trade acceptances
and letters of credit) arising from transactions in the ordinary course
of business in connection with the sale of goods or the performance of
services;
(n) Advances, deposits, down payments and prepayments made in the
ordinary course of business;
(o) Purchases or acquisitions of stock or other securities of any
corporation or enterprise which is, or will thereupon become, a
Subsidiary;
(p) Purchases or acquisitions of stock or other securities of any
corporation if, after giving effect to previous purchases of stock or
securities of such corporation, if any, the Borrower will account for
such purchases of stock or other securities under the equity method of
accounting or whose financial statements are consolidated with those of
the Borrower;
(q) Endorsements of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;
(r) Investments in a Subsidiary or any other corporation which
would be a Subsidiary assuming conversion by the Borrower or a
Subsidiary of preferred stock or debt securities of said corporation
and Guarantees of any Debt or other obligation of the Borrower or any
Subsidiary;
(s) Guarantees of (i) lease obligations of GC Companies, Inc. and
its Subsidiaries outstanding on the date hereof, including renewals of
such obligations, or (ii) lease obligations of lessees in which the
Borrower or a Subsidiary has at least a 50% stock interest;
(t) Guarantees of bonds, notes or other similar obligations of a
state, city, town or other governmental agency or entity which
obligations are issued in order to finance property used or to be used
by the Borrower or any Subsidiary, provided that the obligations so
Guaranteed shall be treated as Debt; and
(u) Additional Investments, not otherwise permitted by paragraphs
(a) through (t) above, if, after giving effect to any such additional
Investment subsequent to October 31, 1994, the aggregate cost of all
such additional Investments made by the Borrower and its Subsidiaries
(less the amount of cash actually received by the Borrower and its
Subsidiaries in respect of repayments, sales or other liquidations of
such Investments) will not exceed 40% of Adjusted Net Worth.
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For the purposes of this Section 5.13, in determining the amount
of an Investment made through the transfer of real property, such property shall
be valued at the book or fair value thereof at the time of transfer, whichever
is greater.
SECTION 5.14. Restrictions on Sales, Consolidations and Mergers.
Neither the Borrower nor any Subsidiary will sell, lease or in any way dispose
of all, or substantially all, of the property or assets of the Borrower and its
Subsidiaries, taken as a whole, nor will the Borrower consolidate or merge with
or into any other Person, provided that this Section 5.14 shall not prevent any
merger involving the Borrower in which the Borrower is the surviving corporation
if, at the time of, and after giving effect to any such merger, no Default shall
have occurred and be continuing.
SECTION 5.15. Transactions with Affiliates. The Borrower will
not, and will not permit any Subsidiary to, directly or indirectly, pay any
funds to or for the account of, make any Investment in, lease, sell, transfer or
otherwise dispose of any assets, tangible or intangible, to, or participate in,
or effect any transaction in connection with any joint enterprise or other joint
arrangement with, any Affiliate; provided, however, that the foregoing
provisions of this Section shall not prohibit (a) the Borrower from declaring or
paying any lawful dividend so long as, after giving effect thereto, no Default
shall have occurred and be continuing or (b) the Borrower or any Subsidiary from
engaging in any commercial transaction with an Affiliate so long as such
transaction is on terms and conditions at least as favorable to the Borrower or
such Subsidiary as the terms and conditions which would apply in a similar
transaction with a Person not an Affiliate.
SECTION 5.16. Restriction on Debt of Subsidiaries. The Borrower
will not permit any of its Subsidiaries to incur or at any time be liable with
respect to any Debt except (a) Debt owing to the Borrower or any Wholly-Owned
Subsidiary, (b) Debt which is secured by a Lien permitted by Sections 5.11 (a)
through 5.11 (i), inclusive, (c) Debt of any corporation at the time such
corporation becomes a Subsidiary and not created in contemplation of such event,
(d) Debt of Subsidiaries not otherwise permitted by any of the foregoing clauses
in an aggregate principal amount at any time outstanding not to exceed
$25,000,000 and (e) Debt of Subsidiaries outstanding on the date of this
Agreement.
SECTION 5.17. Use of Proceeds. The proceeds of the Loans made
under this Agreement will be used by the Borrower for general corporate purposes
and to provide liquidity support for domestic commercial paper. None of such
proceeds will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any "margin stock"
within the meaning of Regulation U.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any
Loan, or shall fail to pay within three days of the due date thereof
any interest or fees payable hereunder;
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(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.08 to 5.17, inclusive;
(c) the Borrower 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 the Borrower by the Administrative Agent at the request of any
Bank;
(d) any material representation, warranty, certification or
statement made by the Borrower 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), and if the same shall be susceptible of
cure, such incorrectness shall not have been cured to the reasonable
satisfaction of the Required Banks within 30 days after notice thereof
has been given to the Borrower by the Administrative Agent at the
request of any Bank;
(e) the Borrower or any Subsidiary shall fail to make any payment
in respect of any Material Financial Obligation when due or within any
applicable grace period;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables (or, with
the giving of notice or lapse of time or both, would enable) the holder
of such Debt or any Person acting on such holder's behalf to accelerate
the maturity thereof;
(g) the Borrower or any Significant Subsidiary or any one or more
Consolidated Subsidiaries having combined assets exceeding 5% of the
consolidated assets of the Borrower and its Consolidated Subsidiaries
shall commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or
its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief
or to the appointment of or taking possession by any such official in
an involuntary case or other proceeding commenced against it, or shall
make a general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Significant Subsidiary or any one or more
Consolidated Subsidiaries having combined assets exceeding 5% of the
consolidated assets of the Borrower and its Consolidated Subsidiaries
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 Borrower or
any Significant Subsidiary or any one or more Consolidated Subsidiaries
having combined assets exceeding 5% of the consolidated assets of the
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Borrower and its Consolidated Subsidiaries under the federal bankruptcy
laws as now or hereafter in effect;
(i) any member of the ERISA Group shall fail to pay when due an
amount or amounts (other than amounts being contested in good faith
through appropriate proceedings) aggregating in excess of $10,000,000
which it shall have become liable to pay under Title IV of ERISA; or
notice of intent to terminate a Material Plan in a distress termination
under Section 4041(c) of ERISA shall be filed under Title IV of ERISA
by any member of the ERISA Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate, to impose liability (other than
for premiums under Section 4007 of ERISA) in respect of, or to cause a
trustee to be appointed to administer any Material Plan; or a condition
shall exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any Material Plan must be terminated; or there
shall occur a complete or partial withdrawal from, or a default, within
the meaning of Section 4219(c)(5) of ERISA, with respect to, one or
more Multiemployer Plans which could cause one or more members of the
ERISA Group to incur a current payment obligation in excess of
$10,000,000;
(j) a judgment or order for the payment of money in excess of
$10,000,000 shall be rendered against the Borrower or any Significant
Subsidiary or any one or more Consolidated Subsidiaries having combined
assets exceeding 5% of the consolidated assets of the Borrower and its
Consolidated Subsidiaries and such judgment or order shall continue
unsatisfied and unstayed for a period of 30 days; or
(k) any person or group of persons (within the meaning of Section
13 or 14 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) other than a member of the Xxxxx Family Group shall
have acquired beneficial ownership (within the meaning of Rule 13d-3 of
the Exchange Act) of more voting stock or total equity capital of the
Borrower than that beneficially owned by the Xxxxx Family Group, if
such person or group of persons is also the beneficial owner (within
the meaning of Rule 13d-3 of the Exchange Act) of at least 15% of
either the voting stock or total equity capital of the Borrower;
then, and in every such event, the Administrative Agent shall (i) if requested
by the Required Banks, by notice to the Borrower terminate the Commitments and
they shall thereupon terminate, and (ii) if requested by Banks holding Notes
evidencing more than 66 2/3% in aggregate principal amount of the Loans, by
notice to the Borrower declare the Notes (together with accrued interest
thereon) to be, and the Notes shall thereupon become, immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower; provided that in the case of any of the
Events of Default specified in clause (g) or (h) above with respect to the
Borrower, without any notice to the Borrower or any other act by the
Administrative Agent or the Banks, the Commitments shall thereupon terminate and
the Notes (together with accrued interest thereon) shall become immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
SECTION 6.02. Notice of Default. The Administrative Agent shall
give notice to the Borrower under Section 6.01(c) or (d) promptly upon being
requested to do so by any Bank and shall thereupon notify all the Banks thereof.
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ARTICLE VII
THE AGENTS AND THE CO-AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes each Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the Notes as are
delegated to such Agent by the terms hereof or thereof, together with all such
powers as are reasonably incidental thereto.
SECTION 7.02. Agents and Affiliates. Xxxxxx Guaranty Trust
Company of New York and The First National Bank of Boston and their respective
successors shall have the same rights and powers under this Agreement as any
other Bank, subject to the provisions of Section 2.03(d), and may exercise or
refrain from exercising the same as though it were not an Agent, and Xxxxxx
Guaranty Trust Company of New York and The First National Bank of Boston and
their respective successors and affiliates may accept deposits from, lend money
to, and generally engage in any kind of business with the Borrower or any
Subsidiary or Affiliate of the Borrower as if it were not an Agent hereunder.
SECTION 7.03. Action by Agents. The obligations of the Agents
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agents shall not be required to take any action
with respect to any Default, except as expressly provided in Article VI.
SECTION 7.04. Consultation with Experts. Each Agent may consult
with legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agents. Neither Agent nor any of their
respective affiliates nor any of the directors, officers, agents or employees of
any of the foregoing shall be liable 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 (ii) in the absence of its own gross negligence or willful misconduct.
Neither Agent nor any of their respective affiliates nor any of the directors,
officers, agents or employees of any of the foregoing shall be responsible for
or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with this Agreement or any
borrowing hereunder; (ii) the performance or observance of any of the covenants
or agreements of the Borrower; (iii) the satisfaction of any condition specified
in Article III, except receipt of items required to be delivered to such Agent;
or (iv) the validity, effectiveness (other than its own due execution and
delivery) or genuineness of this Agreement, the Notes or any other instrument or
writing furnished in connection herewith. Neither Agent shall incur any
liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex, facsimile
transmission or similar writing) believed by it to be genuine or to be signed by
the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify each Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
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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 hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon either Agent, either Co-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 either Agent, either Co-Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking any action under this
Agreement.
SECTION 7.08. Successor Agents. Either Agent may resign at any
time by giving notice thereof to the Banks and the Borrower. Upon any such
resignation, the Borrower shall have the right to appoint a successor Agent,
which shall be reasonably satisfactory to the Required Banks. If no successor
Agent shall have been so appointed by the Borrower, and shall have accepted such
appointment, within 30 days after the retiring Agent gives notice of
resignation, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be a commercial bank organized or licensed under
the laws of the United States of America or of any State thereof and having a
combined capital and surplus of at least $50,000,000. Upon the acceptance of its
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent.
SECTION 7.09. Agents' Fees. The Borrower shall pay to each Agent
for its own account fees in the amounts and at the times previously agreed upon
between the Borrower and such Agent.
SECTION 7.10. Co-Agents. Nothing in this Agreement shall impose
upon either Co-Agent, in such capacity, any duty or obligation whatsoever.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any Fixed
Rate Borrowing:
(a) the Administrative Agent is advised by the Reference Banks
that deposits in dollars (in the applicable amounts) are not being
offered to the Reference Banks in the relevant market for such Interest
Period, or
(b) in the case of a Committed Borrowing, the Required Banks
advise the Administrative Agent that the Adjusted CD Rate or the
Adjusted London Interbank Offered Rate, as the case may be, as
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determined by the Administrative Agent will not adequately and fairly
reflect the cost to such Banks of funding their CD Loans or Euro-Dollar
Loans, as the case may be, for such Interest Period,
the Administrative Agent shall forthwith give notice thereof to the Borrower and
the Banks, whereupon until the Administrative Agent notifies the Borrower that
the circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make CD Loans or Euro-Dollar Loans, as the case may
be, shall be suspended. Unless the Borrower notifies the Administrative Agent at
least one Domestic Business Day before the date of any Fixed Rate Borrowing for
which a Notice of Borrowing has previously been given that it elects not to
borrow on such date, (i) if such Fixed Rate Borrowing is a Committed Borrowing,
such Borrowing shall instead be made as a Base Rate Borrowing and (ii) if such
Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the Money Market LIBOR
Loans comprising such Borrowing shall bear interest for each day from and
including the first day to but excluding the last day of the Interest Period
applicable thereto at the Base Rate for such day.
SECTION 8.02. Illegality. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any change
in any applicable law, rule or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Bank (or its Euro-Dollar Lending Office) with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall make it unlawful or impossible for any
Bank (or its Euro-Dollar Lending Office) to make, maintain or fund its
Euro-Dollar Loans and such Bank shall so notify the Agent, the Administrative
Agent shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Administrative Agent
that the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended. Before
giving any notice to the Administrative Agent pursuant to this Section, such
Bank shall designate a different Euro-Dollar Lending Office if such designation
will avoid the need for giving such notice and will not, in the judgment of such
Bank, be otherwise disadvantageous to such Bank or contrary to its policies.
Outstanding Euro-Dollar Loans shall be maintained to maturity unless such Bank
shall determine that it may not lawfully continue to maintain and fund any of
its outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, in which event the Borrower shall immediately prepay in full the then
outstanding principal amount of each such Euro-Dollar Loan, together with
accrued interest thereon. Concurrently with prepaying each such Euro-Dollar
Loan, the Borrower shall borrow a Base Rate Loan in an equal principal amount
from such Bank (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks), and
such Bank shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on or
after (x) the date hereof, in the case of any Committed Loan or any obligation
to make Committed Loans or (y) the date of the related Money Market Quote, in
the case of any Money Market Loan, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall impose,
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modify or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System, but
excluding (i) with respect to any CD Loan any such requirement included in an
applicable Domestic Reserve Percentage and (ii) with respect to any Euro-Dollar
Loan any such requirement for which such Bank is entitled to compensation under
Section 2.15 for the relevant Interest Period), special deposit, insurance
assessment (excluding, with respect to any CD Loan, any such requirement
reflected in an applicable Assessment Rate) or similar requirement against
assets of, deposits with or for the account of, or credit extended by, any Bank
(or its Applicable Lending Office) or shall impose on any Bank (or its
Applicable Lending Office) or on the United States market for certificates of
deposit or the London interbank market any other condition affecting its Fixed
Rate Loans, its Note or its obligation to make Fixed Rate Loans and the result
of any of the foregoing is to increase the cost to such Bank (or its Applicable
Lending Office) of making or maintaining any Fixed Rate Loan, or to reduce the
amount of any sum received or receivable by such Bank (or its Applicable Lending
Office) under this Agreement or under its Note with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank, the Borrower shall pay to such Bank such additional amount or amounts
as will compensate such Bank for such increased cost or reduction.
(b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on capital of such Bank (or its Parent) as a consequence of such Bank's
Commitment hereunder (to the extent undrawn) to a level below that which such
Bank (or its Parent) could have achieved but for such adoption, change, request
or directive (taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, then from time to
time, within 15 days after demand by such Bank, the Borrower shall pay to such
Bank such additional amount or amounts as will compensate such Bank (or its
Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower of any event of
which it has knowledge, occurring after the date hereof, which will entitle such
Bank to compensation pursuant to this Section and will designate a different
Applicable Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank or contrary to its policies. A
certificate of any Bank claiming compensation under this Section and setting
forth the additional amount or amounts to be paid to it hereunder shall be
conclusive in the absence of clearly demonstrable error. In determining such
amount, such Bank may use any reasonable averaging and attribution methods. Each
such certificate shall be accompanied by such information as the Borrower may
reasonably request as to the computation set forth therein. No payment made to
any Bank under this Section shall duplicate any other payments made to such Bank
under any other provision of this Agreement.
SECTION 8.04. Taxes. (a) Any and all payments by the Borrower to
or for the account of any Bank or the Administrative Agent hereunder or under
any Note shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, charges
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or withholdings, and all liabilities with respect thereto, excluding, in the
case of each Bank and the Administrative Agent, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of which such
Bank or the Administrative Agent (as the case may be) is organized or any
political subdivision of such jurisdiction or any jurisdiction of which such
jurisdiction is a political subdivision and, in the case of each Bank, taxes
imposed on its income, and franchise or similar taxes imposed on it, by the
jurisdiction of such Bank's Applicable Lending Office or any political
subdivision of such jurisdiction or any jurisdiction of which such jurisdiction
is a political subdivision (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings and liabilities being hereinafter
referred to as "Taxes"). If the Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder or under any Note to any
Bank or the Administrative Agent, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 8.04) such Bank or the
Administrative Agent (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make such deductions, (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
law and (iv) the Borrower shall furnish to the Administrative Agent, at its
address referred to in Section 9.01, the original or a certified copy of a
receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, or charges or
similar levies which arise from any payment made hereunder or under any Note or
from the execution or delivery of, or otherwise with respect to, this Agreement
or any Note (hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Bank and the
Administrative 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 8.04) paid by such Bank or
the Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
except where such liability arises from such Bank's gross negligence or willful
misconduct. This indemnification shall be made within 15 days from the date such
Bank or the Administrative Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Bank listed on the signature pages hereof and on
or prior to the date on which it becomes a Bank in the case of each other Bank,
and from time to time thereafter if requested in writing by the Borrower (but
only so long as such Bank remains lawfully able to do so), shall provide the
Borrower with Internal Revenue Service form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Bank is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States. If the form provided by a Bank at the time such Bank first becomes a
party to this Agreement indicates a United States interest withholding tax rate
in excess of zero, withholding tax at such rate shall be considered excluded
from "Taxes" as defined in Section 8.04(a).
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(e) For any period with respect to which a Bank has failed to
provide the Borrower with the appropriate form pursuant to Section 8.04(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Bank shall not be entitled to indemnification under Section 8.04(a) with
respect to Taxes imposed by the United States; provided, however, that should a
Bank, which is otherwise exempt from or subject to a reduced rate of withholding
tax, become subject to Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as such Bank shall reasonably
request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to or
for the account of any Bank pursuant to this Section 8.04, then such Bank will
change the jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such change,
in the judgment of such Bank, is not otherwise disadvantageous to such Bank or
contrary to its policies.
(g) In the event any Bank obtains the benefit of any tax credit
or allowance which may be available to it on account of any Taxes for which it
has been indemnified by the Borrower under this Section 8.04, it will pay to the
Borrower an amount equal to the net benefit so received by such Bank, as
determined in good faith by it. Should it later develop because of loss
carrybacks, tax credit carrybacks or otherwise that such Bank in fact did not
receive the net benefit so paid over to the Borrower, the Borrower will promptly
reimburse such Bank the amount by which the payment theretofore made to the
Borrower exceeds the net benefits actually so received by such Bank, as
determined in good faith by it.
SECTION 8.05. Base Rate Loans Substituted for Affected Fixed Rate
Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans has been
suspended pursuant to Section 8.02 or (ii) any Bank has demanded compensation
under Section 8.03 or 8.04 with respect to its CD Loans or Euro-Dollar Loans and
the Borrower shall, by at least five Euro-Dollar Business Days' prior notice to
such Bank through the Administrative 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 exist:
(a) all Loans which would otherwise be made by such Bank as CD
Loans or Euro-Dollar Loans, as the case may be, shall be made instead
as Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Fixed Rate Loans of the other
Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as the case
may be, has been repaid, all payments of principal which would
otherwise be applied to repay such Fixed Rate Loans shall be applied to
repay its Base Rate Loans instead.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to
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43
such party: (x) in the case of the Borrower or either Agent, at its address or
telex number set forth on the signature pages hereof, (y) in the case of any
Bank, at its address or telex number set forth in its Administrative
Questionnaire or (z) in the case of any party, such other address or telex
number as such party may hereafter specify for the purpose by notice to the
Agents and the Borrower. Each such notice, request or other communication shall
be effective (i) if given by telex, when such telex is transmitted to the telex
number specified in this Section and the appropriate answerback is received,
(ii) if given by mail or by any other means (including, without limitation,
facsimile transmission), when received at the address specified in this Section.
SECTION 9.02. No Waivers. No failure or delay by either Agent or
any Bank in exercising any right, power or privilege hereunder or under any Note
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.
SECTION 9.03. Expenses; Indemnification. (a) The Borrower shall
pay (i) all reasonable out-of-pocket expenses of the Agents, including
reasonable fees and disbursements of special counsel for the Agents, in
connection with the preparation and administration of this Agreement, any waiver
or consent hereunder or any amendment hereof or any Default or alleged Default
hereunder and (ii) if an Event of Default occurs, all reasonable out-of-pocket
expenses incurred by each Agent and Bank, including reasonable fees and
disbursements of counsel (including the allocated cost of in-house counsel), in
connection with such Event of Default and collection, bankruptcy, insolvency and
other enforcement proceedings resulting therefrom.
(b) The Borrower agrees to indemnify each Agent and each Bank,
their respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection
with any investigative, administrative or judicial proceeding (whether or not
such Indemnitee shall be designated a party thereto) brought or threatened
relating to or arising out of this Agreement or any actual or proposed use of
proceeds of Loans hereunder; provided that no Indemnitee shall have the right to
be indemnified hereunder for such Indemnitee's own gross negligence or willful
misconduct as determined by a court of competent jurisdiction; and provided
further that the Banks and the Agents shall use reasonable efforts to avoid
inappropriate duplication of expense in connection with any matter for which
they are indemnified by the Borrower under this subsection (b).
SECTION 9.04. Sharing of Set-Offs. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of principal and
interest due with respect to any Note held by such other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall
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44
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 Borrower other than its indebtedness under the Notes. The
Borrower agrees, to the fullest extent it may effectively do so under applicable
law, that any holder of a participation in a Note acquired pursuant to the
foregoing arrangements may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.05. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of either Agent are affected thereby, by such
Agent); provided that no such amendment or waiver shall, unless signed by all
the Banks, (i) increase or decrease the Commitment of any Bank (except for a
ratable decrease in the Commitments of all Banks) or subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on any
Loan or any fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or any fees hereunder or for or termination
of any Commitment or (iv) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the number of Banks, which
shall be required for the Banks or any of them to take any action under this
Section or any other provision of this Agreement.
SECTION 9.06. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that the Borrower may not
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of all Banks, it being agreed that no merger permitted by
Section 5.14 shall be deemed to be an assignment or transfer for purposes of
this Section 9.06.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment or
any or all of its Loans. In the event of any such grant by a Bank of a
participating interest to a Participant, whether or not upon notice to the
Borrower and the Administrative Agent, such Bank shall remain responsible for
the performance of its obligations hereunder, and the Borrower and the Agent
shall continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement. Any agreement pursuant
to which any Bank may grant such a participating interest shall provide that
such Bank shall retain the sole right and responsibility to enforce the
obligations of the Borrower hereunder including, without limitation, the right
to approve any amendment, modification or waiver of any provision of this
Agreement; provided that such participation agreement may provide that such Bank
will not agree to any modification, amendment or waiver of this Agreement
described in clause (i), (ii) or (iii) of Section 9.05 without the consent of
the Participant. The Borrower agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of Section
2.15 and Article VIII with respect to its participating interest. An assignment
or other transfer which is not permitted by subsection (c) or (d) below shall be
given effect for purposes of this Agreement only to the extent of a
participating interest granted in accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part of all, of its
rights and obligations under this Agreement and the Notes, and such
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45
Assignee shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement in substantially the form of Exhibit G hereto executed by
such Assignee and such transferor Bank, with (and subject to) notice to the
Administrative Agent and the consent of the Borrower (such consent not to be
unreasonably delayed or withheld); provided that (i) if an Assignee is an
affiliate of such transferor Bank, such notice shall be given to the
Administrative Agent and the Borrower but no such consent shall be required,
(ii) such assignment may, but need not, include rights of the transferor Bank in
respect of outstanding Money Market Loans, (iii) unless the assignment covers
all rights and obligations of such assignor Bank, the assignment shall cover the
equivalent of a Commitment of not less than $5,000,000 and (iv) the remaining
Commitment (if any) of the assignor Bank after any such assignment is at least
$5,000,000. Upon execution and delivery of such instrument and payment by such
Assignee to such transferor Bank of an amount equal to the purchase price agreed
between such transferor Bank and such Assignee, such Assignee shall be a Bank
party to this Agreement and shall have all the rights and obligations of a Bank
with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank, the Agents and the Borrower shall make appropriate
arrangements so that, if required, a new Note is issued to the Assignee. In
connection with any such assignment, the transferor Bank shall pay to the
Administrative Agent an administrative fee for processing such assignment in the
amount of $2,500. If the Assignee is not incorporated under the laws of the
United States of America or a state thereof, it shall, prior to the first date
on which interest or fees are payable hereunder for its account, deliver to the
Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section 8.03 or
Section 8.04 than such Bank would have been entitled to receive with respect to
the rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the provisions of Section 8.02, 8.03 or 8.04
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances or at a time when the circumstances giving rise to such
greater payment did not exist.
SECTION 9.07. Collateral. Each of the Banks represents to the
Agents and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.
SECTION 9.08. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
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46
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.
SECTION 9.09. Counterparts; Integration. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
AGENTS AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
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.
HARCOURT GENERAL, INC.
By /s/ Xxxx X. Xxxxxxx
Title: V.P. and Treasurer
00 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxx
Xxxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Telecopier number: (000) 000-0000
COMMITMENTS
$43,750,000 XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK
By /s/ Xxxxxxx X. Xxxxx
Title: Vice President
$43,750,000 THE FIRST NATIONAL BANK OF BOSTON
By /s/ Xxxx X. Xxxxxx
Title: Vice President
$43,750,000 THE BANK OF NOVA SCOTIA
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By /s/ Xxxxxxx X. Xxxxxxx
Title: Authorized Signatory
$43,750,000 NATIONAL WESTMINSTER BANK PLC
By /s/ Xxxxx Xxxx
Title: Vice President
$25,000,000 BANK OF AMERICA ILLINOIS
By /s/ Xxxx Xxxxxxxx
Title: Vice President
$25,000,000 THE CHASE MANHATTAN BANK, N.A.
By /s/ Xxxxx X. Lagenkamp
Title: Vice President
$25,000,000 CREDIT LYONNAIS NEW YORK BRANCH
By /s/ Xxxxxx Xxxxxxxxx
Title: Senior Vice President
CREDIT LYONNAIS CAYMAN ISLAND
BRANCH
By /s/ Xxxxxx Xxxxxxxxx
Title: Authorized Signature
$25,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Xxxxxxxxxx X. Xxxxxxxxxx
Title: Vice President
$25,000,000 THE FUJI BANK LIMITED
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By /s/ Xxxx X. Xxxxxx
Title: Vice President and Mgr.
$25,000,000 NATIONSBANK OF NORTH CAROLINA, N.A.
By /s/ Xxxxxxx Xxxxxxxxx
Title: Vice President
$25,000,000 THE SANWA BANK LIMITED
By /s/ Xxxxxx Xxxxxxxxx
Title: Sr. Vice President
$25,000,000 SWISS BANK CORPORATION
By /s/ Xxxx X. Xxxxxxx
Title: Director Merchant Banking
By /s/ Xxxxxxx X. Xxxxx
Title: Director Restructuring
$25,000,000 TORONTO DOMINION (NEW YORK), INC.
By /s/ Xxxxx Xxxxxx
Title: Vice President
-----------------
TOTAL COMMITMENTS
$400,000,000
=================
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as Documentation Agent
By /s/ Xxxxxxx X. Xxxxx
Title: Vice President
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00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Syndication
Telex No.: 177615
Fax No.: 000-000-0000
THE FIRST NATIONAL BANK OF BOSTON,
as Administrative Agent
By /s/ Xxxx X. Xxxxxx
Title: Vice President
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Media & Communications
Telecopier No.: (000) 000-0000
THE BANK OF NOVA SCOTIA, as
Co-Agent
By /s/ Xxxxxxx X. Xxxxxxx
Title: Authorized Signatory
NATIONAL WESTMINSTER BANK PLC, as
Co-Agent
By /s/ Xxxxx Xxxx
Title: Vice President
PRICING SCHEDULE
The "Euro-Dollar Margin", "CD Margin" and "Facility Fee Rate" for
any day are the respective percentages set forth below in the applicable row
under the column corresponding to the Status that exists on such day:
Xxxxx Xxxxx Xxxxx Xxxxx Xxxxx Xxxxx
Xxxxxx I II III IV V VI
Euro-Dollar
Margin 0.16 0.225 0.25 0.275 0.40 0.50
CD Margin 0.285 0.35 0.375 0.40 0.525 0.625
Facility Fee
Rate 0.09 0.10 0.125 0.15 0.20 0.25
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For purposes of this Schedule, the following terms have the
following meanings:
"Level I Status" exists at any date if, at such date, the
Borrower's long-term debt is rated A or higher by S&P and A2 or higher by
Moody's.
"Level II Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated A- or higher by S&P and A3 or higher by
Moody's and (ii) Level I Status does not exist.
"Level III Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB+ or higher by S&P and Baa1 or higher by
Moody's and (ii) neither Level I Status nor Level II Status exists.
"Level IV Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB or higher by S&P and Baa2 or higher by
Moody's and (ii) none of Level I Status, Level II Status and Level III Status
exists.
"Level V Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB- or higher by S&P and Baa3 or higher by
Moody's and (ii) none of Level I Status, Level II Status, Level III Status and
Level IV Status exists.
"Level VI Status" exists at any date if, at such date, no other
Status exists.
"Moody's" means Xxxxx'x Investors Service, Inc.
"S&P" means Standard & Poor's Corporation.
"Status" refers to the determination of which of Level I Status,
Level II Status, Level III Status, Level IV Status, Level V Status or Level VI
Status exists at any date.
The credit ratings to be utilized for purposes of determining a
Status are those assigned to the senior unsecured long-term debt of the Borrower
without third-party credit enhancement, and any rating assigned to any other
debt of the Borrower shall be disregarded; provided that if the Borrower's
senior unsecured long-term debt is not rated by S&P and Moody's but the
Borrower's subordinated unsecured long-term debt, without third party credit
enhancement, is so rated, then Status shall be determined upon the basis of the
ratings for such subordinated debt and the rating threshold for each Status
shall be adjusted downward by one whole rating category (i.e., Level I Status
shall exist if such subordinated debt is rated A- or higher by S&P and A3 or
higher by Moody's). The rating in effect at any date is that in effect at the
close of business on such date.
EXHIBIT A
NOTE
New York, New York
____________, 1994
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51
For value received, Harcourt General, Inc., a Delaware
corporation (the "Borrower"), promises to pay to the order of
(the "Bank"), for the account of its Applicable Lending Office, the unpaid
principal amount of each Loan made by the Bank to the Borrower pursuant to the
Credit Agreement referred to below on the last day of the Interest Period
relating to such Loan. The Borrower promises to pay interest on the unpaid
principal amount of each such Loan on the dates and at the rate or rates
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of The First National Bank of Boston,
000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000.
All Loans made by the Bank, the respective types and maturities
thereof and all repayments of the principal thereof shall be recorded by the
Bank and, if the Bank so elects in connection with any transfer or enforcement
hereof, appropriate notations to evidence the foregoing information with respect
to each such Loan then outstanding may be endorsed by the Bank on the schedule
attached hereto, or on a continuation of such schedule attached to and made a
part hereof; provided that the failure of the Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower hereunder or
under the Credit Agreement.
This note is one of the Notes referred to in the Credit Agreement
dated as of December 16, 1994 among the Borrower, the banks listed on the
signature pages thereof, and Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, The First National Bank of Boston, as Administrative Agent
and The Bank of Nova Scotia and National Westminster Bank Plc, as Co-Agents (as
the same may be amended from time to time, the "Credit Agreement"). Terms
defined in the Credit Agreement are used herein with the same meanings.
Reference is made to the Credit Agreement for provisions for the prepayment
hereof and the acceleration of the maturity hereof. This Note shall be governed
by and construed in accordance with the laws of the State of New York.
HARCOURT GENERAL, INC.
By _________________________
Title:
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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EXHIBIT B
Form of Money Market Quote Request
______________, 19__
To: The First National Bank of Boston
(the "Administrative Agent")
From: Harcourt General, Inc.
Re: Credit Agreement (the "Credit Agreement") dated as of December
16, 1994 among the Borrower, the Banks listed on the signature
pages thereof, Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, the Administrative Agent and The Bank of
Nova Scotia and National Westminster Bank Plc, as Co-Agents
We hereby give notice pursuant to Section 2.03 of the Credit
Agreement that we request Money Market Quotes for the following proposed Money
Market Borrowing(s):
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Date of Borrowing: _______________
Principal Amount(*) Interest Period(**)
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Terms used herein have the meanings assigned to them in the
Credit Agreement.
(*)Amount must be $5,000,000 or a larger multiple of $1,000,000.
(**)Not less than one month (LIBOR Auction) or not less than 15 days (Absolute
Rate Auction), subject to the provisions of the definition of Interest Period.
HARCOURT GENERAL, INC.
By______________________
Title:
EXHIBIT C
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes
to Harcourt General, Inc. (the "Borrower")
Pursuant to Section 2.03 of the Credit Agreement dated as of
December 16, 1994 among the Borrower, the Banks parties thereto, Xxxxxx Guaranty
Trust Company of New York, as Documentation Agent, the undersigned, as
Administrative Agent, and The Bank of Nova Scotia and National Westminster Bank
Plc, as Co-Agents, we are pleased on behalf of the Borrower to invite you to
submit Money Market Quotes to the Borrower for the following proposed Money
Market Borrowing(s):
Date of Borrowing: ________________
Principal Amount Interest Period
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
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Please respond to this invitation by no later than [4:00 P.M.]
[9:15 A.M.] (Boston, Massachusetts time) on [date].
THE FIRST NATIONAL BANK
OF BOSTON
By________________________
Authorized Officer
EXHIBIT D
Form of Money Market Quote
To: The First National Bank of Boston
(the "Administrative Agent")
Attention:
Re: Money Market Quote to
Harcourt General, Inc. (the "Borrower")
In response to your invitation on behalf of the Borrower dated
____________, 19__, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank:_____________________
2. Person to contact at Quoting Bank:
3. Date of Borrowing:______________(*)
4. We hereby offer to make Money Market Loan(s) in the following
principal amounts, for the following Interest Periods and at the following
rates:
Principal Interest Money Market
Amount(**) Period(***) [Margin(****)] [Absolute Rate(*****)]
$
$
[Provided, that the aggregate principal amount of Money Market Loans
for which the above offers may be accepted shall not exceed
$________________.]**
We understand and agree that the offer(s) set forth above,
subject to the satisfaction of the applicable conditions set forth in the Credit
Agreement dated as of December 16, 1994 among the Borrower, the Banks listed on
the signature pages thereof, Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, yourselves, as Administrative Agent, and The
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00
Xxxx xx Xxxx Xxxxxx and National Westminster Bank Plc, as Co-Agents irrevocably
obligates us to make the Money Market Loan(s) for which any offer(s) are
accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated:__________________ By:_____________________
Authorized Officer
(*)As specified in the related Invitation.
(**)Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the individual
offers exceeds the amount the Bank is willing to lend. Bids must be made for
$5,000,000 or a larger multiple of $1,000,000.
(***)Not less than one month or not less than 15 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
(****)Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period. Specify percentage (to the nearest 1/10,000 of 1%)
and specify whether "PLUS" or "MINUS".
(*****)Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
EXHIBIT E
OPINION OF
COUNSEL FOR THE BORROWER
------------------------
[Effective Date]
To the Banks and the Agents
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Documentation Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
In my capacity as Senior Vice President and General Counsel of
Harcourt General, Inc. (the "Borrower"), I, together with
___________________________, have acted as counsel to the Borrower in connection
with the preparation, execution and delivery of the Credit
Page=55
56
Agreement dated as of December 16, 1994 among the Borrower, the Banks listed on
the signature pages thereof, Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, The First National Bank of Boston, as Administrative Agent
and The Bank of Nova Scotia and National Westminster Bank Plc, as Co-Agents (the
"Agreement"). Capitalized terms used in this opinion which are not defined
herein shall have the same meaning as in the Agreement.
I have examined the originals, or copies certified to my
satisfaction, of the Agreement, the Notes, the charter documents and the By-Laws
of the Borrower and the Significant Subsidiaries, records of the Borrower's
corporate proceedings, all Debt instruments and other material agreements and
instruments to which the Borrower or a Significant Subsidiary is a party and of
which I have knowledge, certificates of public officials and such other
documents,agreements, certificates and records as I have deemed necessary to
examine as a basis for the opinions hereinafter expressed.
I am an attorney admitted to practice in the Commonwealth of
Massachusetts. I am not, and do not purport to be, an expert in or qualified to
express opinions concerning the laws of any jurisdiction other than
Massachusetts, the United States of America and the corporate laws of the State
of Delaware to the extent necessary to express the opinions hereinafter set
forth. For the purposes of this opinion, I have assumed without investigation
that the laws of the State of New York are the same as those of the Commonwealth
of Massachusetts.
Based upon the foregoing, and having regard for such legal
considerations as I have deemed relevant, I am of the opinion that:
1. The Borrower and each Significant Subsidiary (i) is a
corporation duly organized, validly existing and in good standing under the laws
of its respective state of incorporation, (ii) has all requisite corporate power
and all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted and as presently contemplated
and (iii) is in good standing as a foreign corporation and is duly qualified to
conduct business in each jurisdiction in which its property or business as
presently conducted or contemplated makes such qualification necessary, except
in those jurisdictions in which the failure to be so qualified would not have a
material adverse effect upon the business or financial condition of the Borrower
or such Significant Subsidiary and would not (after qualification) preclude the
Borrower or such Significant Subsidiary from enforcing claims against any party
in the courts of such jurisdictions.
2. The execution, delivery and performance by the Borrower of the
Agreement and the Notes 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 except for
the filing of the Agreement with the Securities and Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended, and the Agreement and the
Notes do not contravene, or constitute a default under, any provision of
applicable law or of the Restated Certificate of Incorporation or By-Laws of the
Borrower or of any agreement, judgment, injunction, order, decree or other
instrument binding upon the Borrower or any Significant Subsidiary.
3. The Agreement and the Notes have been duly and validly
executed and delivered by authorized officers of the Borrower, and the Agreement
and the Notes constitute legal, valid, binding and enforceable
Page=56
57
obligations of the Borrower, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting generally the enforcement of creditors' rights and
except to the extent that the availability of the remedy of specific enforcement
or injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
4. Various suits and claims arising in the ordinary course of
business, some of which involve substantial amounts, are pending against the
Borrower and its Subsidiaries. While the ultimate effect of such litigation
cannot be ascertained at this time, in my opinion, there are no actions, suits,
proceedings or investigations pending, or to my knowledge threatened, against
the Borrower or any Subsidiary in which there is a reasonable possibility of an
adverse decision which would materially adversely affect the business, assets or
financial condition of the Borrower and its Subsidiaries, taken as a whole.
Very truly yours,
EXHIBIT F
OPINION OF
XXXXX XXXX & XXXXXXXX, SPECIAL COUNSEL
FOR THE AGENT
--------------------------------------
[Effective Date]
To the Banks and the Agents
Referred to Below
c/x Xxxxxx Guaranty Trust Company
of New York, as Documentation Agent
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
We have participated in the preparation of the Credit Agreement
(the "Credit Agreement") dated as of December 16, 1994 among Harcourt General,
Inc., a Delaware corporation (the "Borrower"), the banks listed on the signature
pages thereof (the "Banks"), Xxxxxx Guaranty Trust Company of New York, as
Documentation Agent, The First National Bank of Boston, as Administrative Agent
and The Bank of Nova Scotia and National Westminster Bank Plc, as Co-Agents and
have acted as special counsel for the Agents for the purpose of rendering this
opinion pursuant to Section 3.01(d) of the Credit Agreement. Terms defined in
the Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
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certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes are within the Borrower's corporate powers and
have been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding agreement
of the Borrower and each Note constitutes a valid and binding obligation of the
Borrower, in each case enforceable in accordance with its terms, except as the
same may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and by general principles of equity.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware. In giving the foregoing opinion, we express no opinion as to
the effect (if any) of any law of any jurisdiction (except the State of New
York) in which any Bank is located which limits the rate of interest that such
Bank may charge or collect.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person without our prior written consent.
Very truly yours,
EXHIBIT G
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of __________, 19__ among [ASSIGNOR] (the
"Assignor"), [ASSIGNEE] (the "Assignee") and HARCOURT GENERAL, INC. (the
"Borrower").
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to the Credit Agreement dated as of December 16, 1994 among
the Borrower, the Assignor and the other Banks party thereto, as Banks, Morgan
Guaranty Trust Company of New York, as Documentation Agent, The First National
Bank of Boston, as Administrative Agent and The Bank of Nova Scotia and National
Westminster Bank Plc, as Co-Agents (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor has
a Commitment to make Loans to the Borrower in an aggregate principal amount at
any time outstanding not to exceed $_________;
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WHEREAS, Committed Loans made to the Borrower by the Assignor
under the Credit Agreement in the aggregate principal amount of $_______ are
outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of
the rights of the Assignor under the Credit Agreement in respect of a portion of
its Commitment thereunder in an amount equal to $___________ (the "Assigned
Amount"), together with a corresponding portion of its outstanding Committed
Loans, and the Assignee proposes to accept assignment of such rights and assume
the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the Credit
Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to
the Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Committed Loans made by the Assignor outstanding at the date hereof. Upon the
execution and delivery hereof by the Assignor, the Assignee [and the Borrower]
and the payment of the amounts specified in Section 3 required to be paid on the
date hereof (i) the Assignee shall, as of the date hereof, succeed to the rights
and be obligated to perform the obligations of a Bank under the Credit Agreement
with a Commitment in an amount equal to the Assigned Amount, and (ii) the
Commitment of the Assignor shall, as of the date hereof, be reduced by a like
amount and the Assignor released from its obligations under the Credit Agreement
to the extent such obligations have been assumed by the Assignee. The assignment
provided for herein shall be without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore mutually agreed between
them.(*) It is understood that facility fees in respect of the Assigned Amount
accrued to the date hereof 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 of the Borrower. This Agreement is
conditioned upon the consent of the Borrower pursuant to Section 9.06(c) of the
Credit Agreement. The execution of this Agreement by the Borrower and the Agent
is evidence of this consent. Pursuant to Section 9.06(c) the Borrower agrees to
execute and deliver a Note payable to the order of the Assignee to evidence the
assignment and assumption provided for herein.]
SECTION 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 the
Borrower, or the validity and enforceability of the
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obligations of the Borrower in respect of the Credit Agreement or any Note. 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 Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
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________________________
Title:
[ASSIGNEE]
By________________________
Title:
HARCOURT GENERAL, INC.
By________________________
Title:
(*) Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be preferable in
an appropriate case to specify these amounts generically or by formula rather
than as a fixed sum.
