1
Exhibit 10-1
EXECUTION COPY
================================================================================
CREDIT AGREEMENT
Dated as of May 31, 2000,
among
STONE CONTAINER CORPORATION,
ST. LAURENT PAPERBOARD INC.,
THE LENDERS NAMED HEREIN,
THE CHASE MANHATTAN BANK, as an Agent,
BANKERS TRUST COMPANY,
as Administrative Agent,
and
DEUTSCHE BANK CANADA
as Canadian Administrative Agent
----------------
CHASE SECURITIES INC.,
as Syndication Agent, Co-Lead Arranger and Joint Book Manager
and
DB ALEX. XXXXX LLC,
as Co-Lead Arranger and Joint Book Manager
================================================================================
[CS&M Ref. No. 6700-723]
2
2
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Defined Terms 2
SECTION 1.02. Terms Generally 28
SECTION 1.03. Classification of Loans and Borrowings 28
SECTION 1.04. Exchange Rate Calculations 28
ARTICLE II
The Credits
SECTION 2.01. Commitments and Loans 29
SECTION 2.02. Loans 29
SECTION 2.03. Notice of Borrowings 31
SECTION 2.04. Repayment of Loans; Evidence of Debt 31
SECTION 2.05. Fees 32
SECTION 2.06. Interest on Loans 33
SECTION 2.07. Default Interest 34
SECTION 2.08. Alternate Rate of Interest 34
SECTION 2.09. Termination and Reduction of Commitments 34
SECTION 2.10. Conversion and Continuation of Borrowings 35
SECTION 2.11. Repayment of Term Borrowings 36
SECTION 2.12. Optional Prepayments 38
SECTION 2.13. Mandatory Prepayments 38
SECTION 2.14. Reserve Requirements; Change in Circumstances; Increased Costs 41
SECTION 2.15. Change in Legality 43
SECTION 2.16. Indemnity 43
SECTION 2.17. Pro Rata Treatment 44
SECTION 2.18. Sharing of Setoffs 44
SECTION 2.19. Payments 45
SECTION 2.20. Taxes 45
SECTION 2.21. Duty to Mitigate; Assignment of Commitments Under Certain Circumstances 48
SECTION 2.22 Bankers' Acceptances 49
SECTION 2.23. Pro Rata Treatment of Loans and Existing Stone Credit Agreement 51
ARTICLE III
Letters of Credit
ARTICLE IV
Representations and Warranties
SECTION 4.01. Organization; Powers 56
SECTION 4.02. Authorization 56
SECTION 4.03. Enforceability 56
SECTION 4.04. Governmental Approvals 57
SECTION 4.05. Financial Statements 57
SECTION 4.06. No Material Adverse Change 58
SECTION 4.07. Title to Properties; Possession Under Leases 58
SECTION 4.08. Subsidiaries 58
3
3
Section 4.09. Litigation; Compliance with Laws 58
Section 4.10. Agreements 59
Section 4.11. Federal Reserve Regulations 58
Section 4.12. Investment Company Act; Public Utility Holding Company Act 59
Section 4.13. Tax Returns 59
Section 4.14. No Material Misstatements 59
Section 4.15. Employee Benefit Plans 59
Section 4.16. Environmental and Safety Matters 60
Section 4.17. Solvency 61
Section 4.18. Security Documents 62
Section 4.19. Labor Matters 63
Section 4.20. Location of Real Property 63
Section 4.21. Patents, Trademarks, etc 64
Section 4.22. Survival of Warranties 64
Article V
Conditions
Section 5.01. All Credit Events 64
Section 5.02. First Credit Event 65
Article VI
Affirmative Covenants
Section 6.01. Existence; Businesses and Properties 67
Section 6.02. Insurance 68
Section 6.03. Obligations and Taxes 68
Section 6.04. Financial Statements, Reports, etc 68
Section 6.05. Litigation and Other Notices 69
Section 6.06. Benefit Plans 70
Section 6.07. Maintaining Records; Access to Properties and Inspections 70
Section 6.08. Use of Proceeds 71
Section 6.09. Compliance with Law 71
Section 6.10. Further Assurances 71
Section 6.11. Material Contracts 72
Section 6.12. Environmental Matters 72
Section 6.13 Surveys 72
Article VII
Negative Covenants
Section 7.01. Indebtedness 73
Section 7.02. Liens 75
Section 7.03. Sale/Leaseback Transactions 76
Section 7.04. Investments, Loans and Advances 77
Section 7.05. Mergers, Consolidations, Sales of Assets and Acquisitions 78
Section 7.06. Restricted Payments 79
Section 7.07. Transactions with Stockholders and Affiliates 79
Section 7.08. Business 80
Section 7.09. Limitations on Debt Prepayments 80
Section 7.10. Amendment of Certain Documents 81
Section 7.11. Limitation on Dispositions of Stock of Subsidiaries 81
Section 7.12. Restrictions on Ability of Subsidiaries to Pay Dividends 82
Section 7.13. Capital Expenditures 82
4
4
SECTION 7.14. Consolidated EBITDA 82
SECTION 7.15. Interest Coverage Ratio 82
SECTION 7.16. Disposition of Collateral and Other Assets 82
SECTION 7.17. Fiscal Year 83
ARTICLE VIII
Events of Default
ARTICLE IX
The Agents, the Administrative Agents and the Facing Agent
ARTICLE X
Collection Allocation Mechanism
SECTION 10.01. Implementation of CAM 89
SECTION 10.02. Letters of Credit 89
SECTION 10.03. Conversion 91
ARTICLE XI
Miscellaneous
SECTION 11.01. Notices 91
SECTION 11.02. Survival of Agreement 92
SECTION 11.03. Binding Effect 92
SECTION 11.04. Successors and Assigns 92
SECTION 11.05. Expenses; Indemnity 95
SECTION 11.06. Right of Setoff 96
SECTION 11.07. Applicable Law 96
SECTION 11.08. Waivers; Amendment 96
SECTION 11.09. Release of Collateral 97
SECTION 11.10. Interest Rate Limitation 98
SECTION 11.11. Entire Agreement 98
SECTION 11.12. Waiver of Jury Trial 98
SECTION 11.13. Severability 98
SECTION 11.14. Headings 99
SECTION 11.15. Confidentiality 99
SECTION 11.16. Jurisdiction; Consent to Service of Process 99
SECTION 11.17. Judgment Currency 100
SECTION 11.18. Certain Relationships 101
SCHEDULES
Schedule 1.01(b) Guarantors
Schedule 1.01(c) Material Subsidiaries
Schedule 1.01(d) Mortgaged Properties
Schedule 1.01(e) Mortgages
Schedule 1.01(f) Receivables Program Document
Schedule 1.01(g) Liability Management Transactions
Schedule 2.01 Commitments
Schedule 4.07 Certain Title Matters
Schedule 4.08 Subsidiaries
5
5
Schedule 4.09 Litigation
Schedule 4.16 Environmental
Schedule 4.18(b) Filing Offices
Schedule 4.18(c) Mortgage Recording Offices
Schedule 4.19 Labor Matters
Schedule 4.20 Locations of Real Properties
Schedule 6.13 Surveys
Schedule 7.01 Existing Indebtedness
Schedule 7.02 Existing Liens
Schedule 7.04 Existing Investments
Schedule 7.12 Certain Agreements
EXHIBITS
Exhibit A Administrative Questionnaire
Exhibit B Form of Assignment and Acceptance
Exhibit C-1 Form of Canco Subsidiary Guarantee Agreement
Exhibit C-2 Form of Stone Guarantee Agreement
Exhibit C-3 Form of Stone Subsidiary Guarantee Agreement
Exhibit C-4 Maryland Subsidiary Guarantee Agreement
Exhibit D Form of Mortgage
Exhibit E-1 Form of Canadian Pledge Agreement
Exhibit E-2 Form of U.S. Pledge Agreement
Exhibit F-1 Form of Canadian Security Agreement
Exhibit F-2 Form of U.S. Security Agreement
Exhibit G-1 Form of Opinion of Winston & Xxxxxx
Exhibit G-2-A Form of Ontario Opinion of Stikeman Elliott
Exhibit G-2-B Form of Quebec Opinion of Stikeman Elliott
Exhibit G-2-C Form of Tax Opinion of Stikeman Elliott
Exhibit G-3 Form of Opinion of Local Counsel
Exhibit H Reorganization Agreement
Exhibit I-1 Form of Term Note
Exhibit I-2 Form of Revolving Note
6
CREDIT AGREEMENT dated as of May 31, 2000 (as amended,
restated, supplemented or otherwise modified from time to time,
this "Agreement"), among STONE CONTAINER CORPORATION, a Delaware
corporation ("Stone"), ST. LAURENT PAPERBOARD INC., a
corporation amalgamated under the Canada Business Corporations
Act and a wholly owned subsidiary of Stone ("Canco" and,
together with Stone, the "Borrowers"), the Lenders (as defined
in Article I), THE CHASE MANHATTAN BANK, a New York banking
corporation ("Chase") as an Agent, BANKERS TRUST COMPANY, a New
York banking corporation ("BTCo"), as administrative agent for
the Lenders (the "Administrative Agent"), and as collateral
agent for the Lenders (the "Collateral Agent"), the Facing Agent
(as defined in Article I), and DEUTSCHE BANK CANADA, a Chartered
Bank, pursuant to Schedule II of the Bank Act, as Canadian
administrative agent (the "Canadian Administrative Agent") for
the Revolving Lenders (as defined in Article I).
Pursuant to, or in connection with the transactions contemplated by, the
Amended and Restated Pre-Merger Agreement dated as of April 13, 2000 (the
"Pre-Merger Agreement"), among Smurfit-Stone Container Corporation, a Delaware
corporation ("SSCC"), Stone, 3038727 Canada Inc., a corporation existing under
the laws of Canada, 3038727 Nova Scotia Company, an unlimited liability company
existing under the laws of the Province of Nova Scotia, Canada, and Canco, Stone
will acquire Canco through a series of transactions pursuant to which, among
other things, the existing shareholders of Canco will receive (a) cash
consideration of U.S.$12.50 per share of common stock of Canco (such cash
consideration aggregating approximately U.S.$625,000,000) (the "Cash
Consideration") and (b) 1/2 share of common stock of SSCC per share of common
stock of Canco.
The Borrowers have requested (a) the Tranche G Lenders (such term and each
other capitalized term used but not defined in this preamble having the meaning
assigned to it in Article I) to extend credit to Stone in the form of Tranche G
Loans in an initial aggregate principal amount of U.S.$450,000,000, (b) the
Tranche H Lenders to extend credit to Canco in the form of Tranche H Loans in an
initial aggregate principal amount of U.S.$500,000,000, (c) the Revolving
Lenders to extend credit to Canco in the form of Revolving Loans in aggregate
principal amount at any time outstanding not in excess of U.S.$100,000,000 (or
the Canadian Dollar Equivalent thereof) and (d) the Facing Agent to issue
Letters of Credit for the account of Canco in an aggregate principal amount at
any time outstanding not in excess of U.S.$50,000,000 (or the Canadian Dollar
Equivalent thereof).
The Lenders are willing to extend such credit to the Borrowers, and the
Facing Agent is willing to issue Letters of Credit for the account of Canco, in
each case on the terms and subject to the conditions set forth herein.
7
2
Accordingly, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following terms
shall have the meanings specified below:
"2849 Bond Pledge Agreement" shall mean the bond pledge agreement dated as
of May 31, 2000, entered into between 0000-0000 Xxxxxx Inc. and the Collateral
Agent, providing the terms pursuant to which the 2849 Bonds are to be held by
the Collateral Agent, in its capacity as collateral agent and depositary of the
2849 Bonds for the benefit of the Tranche H Lenders, the Revolving Lenders, the
Agents and the Facing Agent.
"2849 Bonds" shall mean any or all of the Bonds issued from time to time by
0000-0000 Xxxxxx Inc. pursuant to the 2849 Hypothec.
"2849 Hypothec" shall mean the Indenture and Deed of Hypothec and Issue of
Bonds executed on May 23, 2000, and entered into between 2849-8954 Quebec Inc.
and the Trustee, pursuant to the terms of which 0000-0000 Xxxxxx Inc. has
created, issued and secured Bonds in the maximum aggregate amount of
Cdn$1,500,000,000.00.
"ABR", when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
"Acceptance Fee" shall mean a fee payable in Canadian Dollars by Canco to
the Canadian Administrative Agent for the account of a Revolving Lender with
respect to the acceptance of a B/A or the making of a B/A Equivalent Loan on the
date of such acceptance or loan, calculated on the face amount of the B/A or the
B/A Equivalent Loan at the rate per annum applicable on such date as set forth
in the row labeled "Eurodollar Revolving/ B/A Spread" in the definition of the
term "Applicable Rate" set forth herein on the basis of the number of days in
the applicable Contract Period (including the date of acceptance and excluding
the date of maturity) and a year of 365 days (it being agreed that the rate per
annum applicable to the B/A Equivalent Loan is equivalent to the rate per annum
otherwise applicable to the Bankers' Acceptance which has been replaced by the
making of such B/A Equivalent Loan pursuant to Section 2.22).
"Acquired Indebtedness" is defined in Section 7.01(m).
"Acquisition" shall mean the acquisition by Stone of Canco, pursuant to,
and as described in, the Pre-Merger Agreement and the Reorganization Agreement.
"Adjusted LIBO Rate" shall mean, with respect to any Eurodollar Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the product of (a) the LIBO Rate in
effect for such Interest Period and (b) Statutory Reserves. For purposes hereof,
the term "LIBO Rate" shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, the rate appearing on Page 3750 of the Dow Xxxxx Service
(or on any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by
8
3
the Administrative Agent from time to time for purposes of providing quotations
of interest rates applicable to U.S. Dollar deposits in the London interbank
market) at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the average of the
respective rates per annum at which dollar deposits approximately equal in
principal amount to the Administrative Agent's portion of such Eurodollar
Borrowing and for a maturity comparable to such Interest Period are offered to
the principal London office of the Administrative Agent in immediately available
funds in the London interbank market at approximately 10:00 a.m., Standard Time,
two Business Days prior to the commencement of such Interest Period.
"Administrative Agent" is defined in the preamble to this Agreement;
provided that, unless the context otherwise requires, when used in respect of
payments and notices pertaining to Revolving Loans and Letters of Credit, the
term "Administrative Agent" shall mean the Canadian Administrative Agent.
"Administrative Questionnaire" shall mean an Administrative Questionnaire
in the form of Exhibit A, or any other form supplied from time to time by the
Administrative Agent.
"Affiliate" shall mean, when used with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified. For purposes of this definition, neither any Lender nor any Affiliate
of a Lender shall be deemed to be an Affiliate of either Borrower or any of the
Subsidiaries solely by reason of its ownership of or right to vote any
Indebtedness of the Borrowers or any of the Subsidiaries.
"Agents" shall mean Chase, BTCo and the Canadian Administrative Agent.
"Agreement" shall mean this Credit Agreement.
"Alternate Base Rate" shall mean, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater of (a) the
Prime Rate (or, with respect to any ABR Revolving Loan, the U.S. Base Rate) in
effect on such day and (b) the Federal Funds Effective Rate in effect on such
day plus 0.50%. Any change in the Alternate Base Rate due to a change in the
Prime Rate, the U.S. Base Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate, the U.S. Base
Rate or the Federal Funds Effective Rate, respectively.
"Applicable Percentage" of any Revolving Lender shall mean the percentage
of the aggregate Revolving Credit Commitments represented by such Revolving
Lender's Revolving Credit Commitment. If the Revolving Credit Commitments shall
have terminated or expired, the Applicable Percentages shall be determined based
upon the Revolving Credit Commitments most recently in effect, giving effect to
any assignments.
"Applicable Rate" shall mean, for any day, (a) with respect to any (i)
Eurodollar Term Loan or (ii) ABR Term Loan, as the case may be, the applicable
percentage set forth below under the
9
4
caption (A) "Eurodollar Term Loan Spread" or (B) "ABR Term Loan Spread", as the
case may be, based upon the Consolidated Leverage Ratio as of the relevant date
of determination:
Term Loans
Consolidated Eurodollar Term Loan ABR Term Loan
Leverage Ratio Spread Spread
-------------- -------------------- ---------------
Greater than or equal to 3.00 to 1.00 3.50% 2.50%
Greater than or equal to 2.00 to
1.00 but less than 3.00 to 1.00 3.25% 2.25%
Less than 2.00 to 1.00 3.00% 2.00%
and (b) with respect to any (i) Eurodollar Revolving Loan or B/A Loan,
(ii) ABR Revolving Loan or Canadian Prime Rate Loan or (iii) Commitment Fee
in respect of unused Commitments, as the case may be, the applicable
percentage set forth below under the caption (A) "Eurodollar Revolving/B/A
Spread", (B) "ABR Revolving/ Canadian Prime Rate Spread" and (C)
"Commitment Fee", as the case may be, based upon the Consolidated Leverage
Ratio as of the relevant date of determination:
Revolving Loans and Revolving Commitments
ABR
Revolving/
Eurodollar Canadian
Consolidated Revolving/ Prime Rate Commitment
Leverage Ratio B/A Spread Spread Fee
-------------- ---------- ---------- ----------
Greater than or equal to 4.00 to 1.00 3.00% 2.00% 0.500%
Greater than or equal to 3.50 to 1.00
but less than 4.00 to 1.00 2.75% 1.75% 0.500%
Greater than or equal to 3.00 to 1.00
but less than 3.50 to 1.00 2.50% 1.50% 0.500%
Greater than or equal to 2.50 to 1.00
but less than 3.00 to 1.00 2.25% 1.25% 0.375%
Less than 2.50 to 1.00 2.00% 1.00% 0.375%
Each change in the Applicable Rate resulting from a change in the Consolidated
Leverage Ratio shall be effective with respect to all Loans, Commitments and
Letters of Credit on the date of delivery to the Administrative Agent of the
financial statements and certificates required by Section 6.04(a) or (b) and
(c), respectively, based upon the Consolidated Leverage Ratio as of the end of
the most recent fiscal quarter included in such financial statements so
delivered, and shall remain in effect until the date immediately preceding the
next date of delivery of such financial statements and certificates indicating
another such change. Notwithstanding the foregoing, (x) until
10
5
delivery to the Administrative Agent of the financial statements and
certificates required by Sections 6.04(b) and (c), respectively for the period
ending March 31, 2001, the Consolidated Leverage Ratio shall be deemed to be not
less than 4.00 to 1.00 for purposes of determining the Applicable Rate and (y)
at any time after the occurrence and during the continuance of an Event of
Default, the Consolidated Leverage Ratio shall be deemed greater than or equal
to 4.00 to 1.00 for purposes of determining the Applicable Rate.
"Asset Sale" shall mean the sale, transfer or other disposition (including
any casualty or condemnation) by either Borrower or any Subsidiary to any Person
other than a wholly owned Subsidiary of (i) any capital stock in any Person
(excluding capital stock in Stone issued or otherwise transferred to SSCC), (ii)
substantially all the assets of any geographic or other division or line of
business of such Borrower or any of the Subsidiaries or (iii) any Real Property
or a portion of any Real Property or any other asset or assets (excluding any
assets manufactured, constructed or otherwise produced or purchased for sale to
others in the ordinary course of business, the sale or liquidation of any
Permitted Investments and any Program Receivables) of such Borrower or any
Subsidiary, provided that (i) any asset sale or series of related asset sales
described in clause (iii) above having a value not in excess of $2,000,000 shall
not be deemed an "Asset Sale" for purposes of this Agreement and (ii) the sale
of assets (other than Collateral) securing any Indebtedness permitted hereunder
(other than the Loans) shall not be deemed to be an "Asset Sale" unless such
Indebtedness shall be repaid, redeemed or repurchased in full with the proceeds
of such Asset Sale (or any other payment made contemporaneously therewith).
"Assignment and Acceptance" shall mean an assignment and acceptance entered
into by a Lender and an assignee and, to the extent required by Section
11.04(b), approved by the Borrowers, an Agent and the Facing Agent, in the form
of Exhibit B or such other form as shall be approved by the Administrative
Agent.
"B/A Equivalent Loan" has the meaning specified in Section 2.22.
"B/A Loan" shall mean a Borrowing comprised of one or more Bankers'
Acceptances or, as applicable, B/A Equivalent Loans. For greater certainty, all
provisions of this Agreement which are applicable to Bankers' Acceptances are
also applicable, mutatis mutandis, to B/A Equivalent Loans.
"Bankers' Acceptance" and "B/A" shall mean a non-interest bearing
instrument denominated in Canadian Dollars, drawn by Canco, and accepted by a
Revolving Lender in accordance with this Agreement, and shall include a
depository note within the meaning of the Depository Bills and Notes Act
(Canada) and a xxxx of exchange within the meaning of the Bills of Exchange Act
(Canada).
"Board" shall mean the Board of Governors of the Federal Reserve System of
the United States.
"Bondholders" shall mean any or all holders of the Bonds.
"Bond Pledge Agreements" shall mean, collectively, the Canco Bond Pledge
Agreement, the Francobec Bond Pledge Agreement and the 0000 Xxxx Xxxxxx
Xxxxxxxxx.
"Bonds" shall mean any or all of the Canco Bonds, the Francobec Bonds or
the 2849 Bonds.
"Borrowers" is defined in the preamble to this Agreement.
11
6
"Borrowing" shall mean a group of Loans of a single Type made, converted or
continued by the Lenders on a single date and as to which a single Interest
Period is in effect.
"BTCo" is defined in the preamble to this Agreement. Any reference to
"BTCo, as Administrative Agent" or "BTCo, as Collateral Agent" herein shall be
deemed a reference to BTCo in its capacity as Administrative Agent or Collateral
Agent, respectively, hereunder unless and until such time that a replacement
Administrative Agent or Collateral Agent, respectively, is named pursuant to the
provisions of Article IX.
"Business Day" shall mean any day (other than a Saturday, Sunday or legal
holiday in the State of New York) on which banks are open for business in New
York City and Chicago; provided, however, that (a) when used in connection with
a Eurodollar Loan or Eurodollar Borrowing, the term "Business Day" shall also
exclude any day on which banks are not open for dealings in dollar deposits in
the London interbank market, and (b) when used in connection with a Borrowing by
Canco, a Borrowing denominated in Canadian Dollars or a Letter of Credit, the
term "Business Day" shall also exclude any day on which banks are not open for
business in Toronto or Montreal.
"Calculation Date" shall mean (a) the last Business Day of each month, (b)
the date of each notice of borrowing and (c) the Business Day preceding the
issuance, amendment, extension or renewal of each Letter of Credit denominated
in Canadian Dollars.
"CAM" shall mean the mechanism for the allocation and exchange of interests
in the Credit Facilities and collections thereunder established under Article X.
"CAM Exchange" shall mean the exchange of the Lenders' interests provided
for in Section 10.01.
"CAM Exchange Date" shall mean the first date after the Closing Date on
which there shall occur (a) any event described in paragraph (g) or (h) of
Article VIII with respect to either Borrower or (b) an acceleration of the
maturity of Loans pursuant to Article VIII.
"CAM Percentage" shall mean, as to each Lender, a fraction, expressed as a
decimal, of which (a) the numerator shall be the sum of (i) the aggregate
Designated Obligations owed to such Lender and (ii) the L/C Exposure, if any, of
such Lender, in each case immediately prior to the CAM Exchange Date, and (b)
the denominator shall be the sum of (i) the aggregate Designated Obligations
owed to all the Lenders and (ii) the aggregate L/C Exposure of all the Lenders,
in each case immediately prior to such CAM Exchange Date. For purposes of
computing each Lender's CAM Percentage, all Designated Obligations which shall
be denominated in Canadian Dollars shall be translated into U.S. Dollars at the
Exchange Rate in effect on the CAM Exchange Date.
"Cameo" shall mean Cameo Container Corporation, an Illinois corporation.
"Cameo Note" shall mean a promissory note in the principal amount up to
$50,000,000 issued by Cameo in favor of Stone.
"Canadian Administrative Agent" is defined in the preamble to this
Agreement.
"Canadian Amalgamations" shall mean the amalgamations to be consummated
pursuant to Sections 2.2(i)(iii) and 2.3(d)(i) and (iv) of the Reorganization
Agreement, including the amalgamation of Canco and Stone Container (Canada) Inc.
12
7
"Canadian Benefit Plans" shall mean all employee benefit plans of any
nature or kind whatsoever that are not Canadian Pension Plans and are maintained
or contributed to by Canco or any of its Subsidiaries.
"Canadian Dollars" and "Cdn.$" shall mean lawful currency of Canada.
"Canadian Dollar Equivalent" shall mean, on any date of determination, with
respect to any amount in U.S. Dollars, the equivalent in Canadian Dollars of
such amount determined by the Administrative Agent using the Exchange Rate then
in effect.
"Canadian GAAP" shall mean generally accepted accounting principles in
Canada, as recommended from time to time by the Canadian Institute of Chartered
Accountants, applied on a consistent basis.
"Canadian Pension Plans" shall mean each plan which is considered to be a
pension plan for the purposes of any applicable pension benefits standards
statute and/or regulation in Canada established, maintained or contributed to by
Canco or any of its Subsidiaries for its employees or former employees.
"Canadian Pledge Agreements" shall mean (a) the Pledge Agreement dated May
31, 2000, substantially in the form of Exhibit E-1, between Canco and BTCo, as
Collateral Agent; and (b) any other pledge agreement pursuant to which Canco or
any of the Canadian Subsidiaries pledges shares of capital stock owned by it to
BTCo, as Collateral Agent, as security for all or any portion of the Obligations
of Canco.
"Canadian Prime Rate" shall mean, for each day in any period, a fluctuating
interest rate per annum as shall be in effect from time to time, which rate per
annum shall at all times for such day be equal to the higher of (a) the annual
rate of interest announced publicly by the Canadian Administrative Agent and in
effect as its prime rate at its principal office in Toronto, Ontario on such day
for determining interest rates on Canadian Dollar-denominated commercial loans
made in Canada and (b) 0.75% per annum above the CDOR Rate in effect on such
date.
"Canadian Security Agreement" shall mean (i) the Canadian Security
Agreement in substantially the form of Exhibit F-1 dated as of the date hereof
between Canco and certain of the Canadian Subsidiaries, as grantors, and BTCo,
as Collateral Agent, and (ii) any other security agreements executed by Canco or
any Canadian Subsidiary to secure all or any portion of the Obligations of Canco
after the Closing Date.
"Canadian Subsidiaries" shall mean the Subsidiaries organized under the
laws of Canada or any province or other political subdivision thereof.
"Canco" is defined in the preamble to this Agreement. Upon consummation of
the Canadian Amalgamations, Canco shall mean Smurfit-Stone Container Canada
Inc., a corporation amalgamated pursuant to the Canada Business Corporations
Act. The Agents and the Lenders acknowledge and agree that Canco may in the
future be continued as a corporation under the laws of New Brunswick.
"Canco Bond Pledge Agreement" shall mean the bond pledge agreement dated as
of May 31, 2000, entered into between Canco and the Collateral Agent, providing
the terms pursuant to which the Canco Bonds are to be held by the Collateral
Agent, in its capacity as collateral agent and
13
8
depositary of the Canco Bonds for the benefit of the Tranche H Lenders, the
Revolving Lenders, the Agents and the Facing Agent.
"Canco Bonds" shall mean any or all of the Bonds issued from time to time
by Canco pursuant to the Canco Hypothec.
"Canco Credit Parties" shall mean Canco and its Subsidiaries.
"Canco Hypothec" shall mean the Indenture and Deed of Hypothec and Issue of
Bonds executed on May 23, 2000, and entered into between Canco and the Trustee,
pursuant to the terms of which Canco has created, issued and secured Bonds in
the maximum aggregate amount of Cdn$1,500,000,000.00.
"Canco Subsidiary Guarantees" shall mean the guarantee agreements dated as
of the date hereof substantially in the form of Exhibit C-1 in favor of BTCo, as
Collateral Agent, by each wholly owned Subsidiary of Canco.
"Cash Consideration" is defined in the preamble to this Agreement.
"Capital Lease" is defined in the definition of the term "Capital Lease
Obligations".
"Capital Lease Obligations" of any Person shall mean the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof (each, a "Capital Lease"), which obligations are required to
be classified and accounted for as capital leases on a balance sheet of such
Person under U.S. GAAP, and, for the purposes of this Agreement, the amount of
such obligations at any time shall be the capitalized amount thereof at such
time determined in accordance with U.S. GAAP.
"Cash Proceeds" shall mean, with respect to any Asset Sale, cash, cash
equivalents or marketable securities received from such Asset Sale, including
any insurance or condemnation proceeds and proceeds received by way of deferred
payment pursuant to a note receivable or otherwise (other than the portion of
such deferred payment constituting interest, which shall be deemed not to
constitute Cash Proceeds).
"CDOR Rate" shall mean, for each day in any period, the annual rate of
interest that is the rate based on an average rate applicable to Canadian Dollar
bankers' acceptances for a term equal to the term of the relevant Contract
Period (or for a term of 30 days for purposes of determining the Canadian Prime
Rate) appearing on the Reuters Screen CDOR Page at approximately 10:00 a.m.
(Standard Time), on such date, or if such date is not a Business Day, on the
immediately preceding Business Day, provided that if such rate does not appear
on the Reuters Screen CDOR Page on such date as contemplated, then the CDOR Rate
on such date shall be the arithmetic average of the Discount Rate quoted by each
Schedule I Reference Bank (determined by the Canadian Administrative Agent as of
10:00 a.m. Standard Time on such date) which would be applicable to Canadian
Dollar bankers' acceptances quoted by the banks listed in Schedule I of the Bank
Act (Canada) as of 10:00 a.m. (Standard Time) on such date or, if such date is
not a Business Day, on the immediately preceding Business Day.
"CERCLA" is defined in Section 4.16(b).
A "Change in Control" shall be deemed to have occurred if (a) JSG and its
Affiliates shall cease to own or control shares representing at least 27-1/2% of
the aggregate ordinary voting power
14
9
represented by the issued and outstanding capital stock of SSCC; (b) any person
or group (within the meaning of Rule 13d-5 of the Securities and Exchange Act of
1934, as in effect on the Closing Date) other than JSG and its Affiliates shall
own, directly or indirectly, beneficially or of record, shares representing more
than 20% of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of SSCC; (c) SSCC shall cease to own, directly or
indirectly, beneficially and of record, 100% of the issued and outstanding
capital stock of Stone, other than the Series E Preferred Stock; or (d) Stone
shall cease to own or control, directly or indirectly, shares representing 100%
of the aggregate ordinary voting power represented by the issued and outstanding
capital stock of Canco.
"Change of Law" is defined in Section 2.20(f). "Charges" is defined in
Section 11.10. "Chase" is defined in the preamble to this Agreement.
"Class", when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Tranche
G Loans or Tranche H Loans, and, when used in reference to any Commitment,
refers to whether such Commitment is a Revolving Credit Commitment or Term Loan
Commitment.
"Closing Date" shall mean May 31, 2000.
"Cluster Expenditures" shall mean capital expenditures that are mandated
pursuant to, or made to comply with, the final adopted version, if any, of the
proposed rules promulgated by the Environmental Protection Agency, 58 Fed. Reg.
66078 (Dec. 17, 1993) with respect to "Effluent Limitations Guidelines,
Pretreatment Standards, and New Source Performance Standards: Pulp, Paper, and
Paperboard Category" or "National Emission Standards for Hazardous Air
Pollutants for Source Category: Pulp and Paper Production".
"Code" shall mean the Internal Revenue Code of 1986, or any successor
statute thereto, as the same may be amended from time to time.
"Collateral" shall mean all the "Collateral" as defined in any Security
Document and shall also include the Mortgaged Properties.
"Collateral Agent" is defined in the preamble to this Agreement.
"Commitment" shall mean, with respect to each Lender, such Lender's
Revolving Credit Commitment and Term Loan Commitments, and "Commitments" shall
mean, collectively, the Commitments of all the Lenders.
"Commitment Fee" is defined in Section 2.05(a).
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of SSCC dated March 2000, as supplemented by the letter
to Lenders, dated May 2, 2000.
"Consolidated Capital Expenditures" shall mean, for any period, all amounts
that would be included as additions to property, plant and equipment and other
capital expenditures on a consolidated statement of cash flows for Stone and its
Subsidiaries during such period in accordance
15
10
with U.S. GAAP (excluding capitalized interest but including the amount of
assets leased under any Capital Lease); provided, however, that in no event
shall Consolidated Capital Expenditures include amounts (i) expended (in
compliance with the provisions of any Mortgage, if applicable) in the
replacement, repair or reconstruction of any fixed or capital asset which was
destroyed, damaged or condemned, in whole or in part, to the extent insurance or
condemnation proceeds are receivable or have been received by Stone or any of
its Subsidiaries in respect of such destruction, damage or condemnation and (ii)
expended in the replacement of any fixed or capital asset securing the First
Mortgage Notes within the time permitted for redeployment of the proceeds of the
replaced fixed or capital asset pursuant to Section 1015 of the indenture for
the First Mortgage Notes, to the extent of any cash or cash equivalent proceeds
received by Stone or any of its Subsidiaries in connection with such sale or
other disposition of the fixed or capital asset replaced.
"Consolidated Current Assets" shall mean, as at any date of determination,
the total assets (other than cash and cash equivalents) of Stone and its
Subsidiaries on a consolidated basis that may properly be classified as current
assets in conformity with U.S. GAAP.
"Consolidated Current Liabilities" shall mean, as at any date of
determination, the total liabilities of Stone and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with U.S. GAAP, provided that the current maturities of long-term
Indebtedness for money borrowed of Stone and its Subsidiaries, any Indebtedness
permitted under Section 7.01 that is classified as a current liability in
conformity with U.S. GAAP and any taxes payable solely as a result of Asset
Sales shall be excluded from the definition of Consolidated Current Liabilities.
"Consolidated EBITDA" for any period shall mean (a) the sum of (i)
Consolidated Net Income for such period, (ii) all Federal, state, local and
foreign taxes deducted in determining such Consolidated Net Income, (iii)
Consolidated Interest Expense deducted in determining such Consolidated Net
Income and (iv) depreciation, depletion, amortization of intangibles and other
non-cash charges or non-cash losses deducted in determining such Consolidated
Net Income minus (b) any non-cash income or non-cash gains included in
determining such Consolidated Net Income. For the purposes of determining
compliance with Section 7.14 and determining, on any date, the Consolidated
Leverage Ratio, Consolidated EBITDA shall be calculated as if the Acquisition
had occurred on the first day of such period.
"Consolidated Interest Expense" shall mean, for any period, the interest
expense (net of interest income on Permitted Investments) of Stone and its
Subsidiaries for such period determined on a consolidated basis in accordance
with U.S. GAAP, excluding any fees and expenses payable or amortized during such
period by Stone and its consolidated Subsidiaries in connection with the
amortization of deferred debt issuance costs. For purposes of the foregoing,
interest expense shall be determined after giving effect to any net payments
made or received by Stone and its consolidated Subsidiaries with respect to Rate
Protection Agreements.
"Consolidated Leverage Ratio" shall mean, on any date of determination, the
ratio obtained by dividing (a) Indebtedness of Stone and its consolidated
Subsidiaries on such date by (b) Consolidated EBITDA for the period of four
consecutive fiscal quarters ending on or immediately prior to such date.
"Consolidated Net Income" shall mean, for any period, the net income (or
loss) of Stone and its Subsidiaries on a consolidated basis for such period
taken as a single accounting period determined in conformity with U.S. GAAP,
provided that there shall be excluded from such calculation (i) the net income
(or loss) of any Person acquired in a pooling of interests transaction
16
11
for any period prior to the date of such acquisition and (ii) the net gains (or
losses) associated with the sale of any asset not in the ordinary course of
business.
"Contract Period" shall mean the term of a B/A Loan selected by Canco in
accordance with Section 2.22 commencing on the date of such B/A Loan and
expiring on a Business Day which shall be either 30 days, 60 days, 90 days or
180 days thereafter, provided that (a) subject to clause (b) below, each such
period shall be subject to such extensions or reductions as may be determined by
the Canadian Administrative Agent to ensure that each Contract Period shall
expire on a Business Day, and (b) no Contract Period shall extend beyond the
Revolving Credit Maturity Date.
"Control" of a Person shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "Controlling" and "Controlled" shall have meanings
correlative thereto.
"Credit Event" is defined in Article V.
"Credit Facility" shall mean a Class of Commitments and extensions of
credit thereunder. For purposes hereof, each of the following comprises a
separate Credit Facility: (a) the Tranche G Loans, (b) the Tranche H Loans and
(c) the Revolving Loans.
"Currency Agreement" shall mean any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement entered into in the
ordinary course of business by Stone or any Subsidiary designed to protect the
Borrowers or any of their Subsidiaries against fluctuations in currency values.
"Default" shall mean any event or condition that upon notice, lapse of time
or both would constitute an Event of Default.
"Default Rate" is defined in Section 2.07.
"Designated Obligations" shall mean all Obligations of the Loan Parties in
respect of (a) principal of and interest on the Loans (including B/A's, B/A
Equivalent Loans and Acceptance Fees with respect thereto) and (b) Fees, whether
or not the same shall at the time of any determination be due and payable under
the terms of the Loan Documents.
"Discount Proceeds" shall mean, for any B/A (or, as applicable, any B/A
Equivalent Loan), an amount (rounded to the nearest whole cent, and with
one-half of one cent being rounded upwards) calculated on the applicable date of
the Revolving Credit Borrowing of which such B/A or B/A Equivalent Loan is a
part or any rollover date for such Revolving Credit Borrowing by multiplying:
(a) the face amount of the B/A (or, as applicable, the B/A Equivalent
Loan); by
(b) the quotient of one divided by the sum of one plus the product
of:
(i) the Discount Rate (expressed as a decimal) applicable to
such B/A (or as applicable, such B/A Equivalent Loan), and
17
12
(ii) a fraction, the numerator of which is the Contract Period of
the B/A (or, as applicable, the B/A Equivalent Loan) and the
denominator of which is 365 days,
with such quotient being rounded up or down to the fifth decimal
place, and .000005 being rounded up.
"Discount Rate" shall mean:
(a) with respect to any Revolving Lender that is a Schedule I Bank, as
applicable to a B/A being purchased by such Lender on any day, the CDOR
Rate; and
(b) with respect to any Revolving Lender that is not a Schedule I
Bank, as applicable to a B/A being purchased by such Lender on any day, the
lesser of (A) the CDOR Rate plus 10 basis points (0.10%), and (B) the
average (as determined by the Canadian Administrative Agent in good faith)
of the respective percentage discount rates (expressed to two decimal
places and rounded upward, if not in an increment of 1/100th of 1%, to the
nearest 0.01%) quoted by the Schedule II Reference Banks as the percentage
discount rates at which the Schedule II Reference Banks would, in
accordance with their normal market practices, at or about 10:00 a.m.
(Standard Time) on such date, be prepared to purchase bankers' acceptances
accepted by the Schedule II Reference Banks having a face amount and term
comparable to the face amount and term of such B/A.
"Domestic Subsidiary" shall mean any Subsidiary organized under the laws of
the United States or any political subdivision thereof.
"Environmental Laws" shall mean all current and future federal, state,
provincial, local and foreign laws, rules or regulations, codes, ordinances,
orders, decrees, judgments or injunctions issued, promulgated, approved or
entered thereunder or other requirements of Governmental Authorities or the
common law, relating to health, safety, or pollution or protection of the
environment, including laws relating to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals or industrial, toxic
or hazardous substances, or wastes into the environment (including ambient air,
surface water, groundwater, land surface or subsurface strata) or otherwise
relating to the manufacture, processing, distribution, use, generation,
treatment, storage, disposal, transport or handling of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances, or wastes, or
underground storage tanks and emissions therefrom.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, or
any successor statute, as the same may be amended from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that (a) is a member of a group of which either Borrower is a
member and (b) is treated as a single employer under Section 414 of the Code.
"Eurodollar", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" shall have the meaning assigned to such term in Article
VIII.
"Event of Failure" shall have the meaning assigned to such term in Section
2.13(b).
18
13
"Excess Cash Flow" shall mean, for any period, (a) the sum, without
duplication, of (i) Consolidated Net Income during such period, (ii) the amount
of depreciation, depletion, amortization of intangibles, deferred taxes,
accreted and zero coupon bond interest and other non-cash expenses, losses or
other charges that, pursuant to U.S. GAAP, were deducted in determining such
Consolidated Net Income, (iii) the proceeds of any Capital Leases of Stone and
its Subsidiaries on a consolidated basis, (iv) reductions, other than reductions
attributable solely to Asset Sales, to working capital for such period (i.e.,
the decrease in Consolidated Current Assets minus Consolidated Current
Liabilities from the beginning to the end of such period) and (v) Indebtedness
of Stone and its consolidated Subsidiaries created, incurred or assumed in
respect of the purchase or construction of property minus (b) the sum, without
duplication, of (i) the amount of all non-cash gains, income or other credits
included in determining Consolidated Net Income, (ii) additions to working
capital for such period (i.e., the increase in Consolidated Current Assets minus
Consolidated Current Liabilities from the beginning to the end of such period),
(iii) the Term Loan Repayment Amounts paid during such period, (iv) optional
prepayments of Term Loans described in Section 2.12(b) during such period, (v)
scheduled and optional payments or prepayments of the principal amount of
permitted Indebtedness other than the Loans, but only to the extent that such
payments or prepayments cannot by their terms be reborrowed or redrawn and do
not occur in connection with a refinancing of all or any portion of such
permitted Indebtedness and are otherwise permitted hereby, (vi) Consolidated
Capital Expenditures for such period and (vii) Restricted Payments not
prohibited hereunder made during such period; provided, however, that none of
the following shall be included in a determination of Excess Cash Flow: (x)
amounts expended for any Investment permitted under Section 7.04 and any
proceeds from the subsequent sale or other disposition of any such Investment,
(y) the proceeds of any issuance of debt or equity securities not otherwise
prohibited hereunder and (z) the proceeds from the sale of assets of either
Borrower or any Subsidiary to the extent such proceeds would be required (before
giving effect to any waiver) to mandatorily prepay any permitted Indebtedness
(including the Loans).
"Exchange Rate" shall mean, on any day, (a) for purposes of determining the
U.S. Dollar Equivalent, the rate at which Canadian Dollars may be exchanged into
U.S. Dollars and (b) for purposes of determining the Canadian Dollar Equivalent,
the rate at which U.S. Dollars may be exchanged into Canadian Dollars, in each
case as set forth on the Reuters World Currency Page for Canadian Dollars (or,
if not so quoted, the spot rate of exchange quoted for wholesale transactions
made by the Canadian Administrative Agent in Toronto, Ontario) at 12:00 noon,
Standard Time, on such day; provided, that if at the time of any such
determination, for any reason, no such spot rate is being quoted, the Canadian
Administrative Agent may use any reasonable method it deems applicable to
determine such rate, and such determination shall be conclusive absent manifest
error.
"Existing SLP Credit Agreements" shall mean the Credit Agreement by and
among Canco., St. Laurent Paperboard (U.S.) Inc. and The Toronto-Dominion Bank
dated as of February 25, 1998, as supplemented by the First Supplemental Credit
Agreement dated as of September 7, 1999, and the Amended and Restated Credit
Agreement dated as of December 23, 1999 by and among Eastern Container
Corporation and Toronto Dominion (Texas), Inc. and The Toronto-Dominion Bank.
"Existing Stone Collateral" shall mean all or any portion of the assets
(whether now owned or hereafter acquired) of Stone or its Subsidiaries that
secures the obligations of Stone or any Subsidiary under the Existing Stone
Credit Agreement from time to time.
"Existing Stone Credit Agreement" shall mean the Amended and Restated
CreditAgreement, dated as of March 31, 2000 (as amended, restated, supplemented
or otherwise modified from time to time), among Stone, the Existing Stone
Lenders, Chase, as agent for such lenders, and Bankers
19
14
Trust Company, as agent, administrative agent and facing agent for such lenders
and as swingline lender.
"Existing SLP Indebtedness" shall mean the Existing SLP Credit Agreements
and the Existing SLP Notes.
"Existing SLP Notes" shall mean the Series A Notes, the Series B Notes and
the Series C Notes issued pursuant to the Amended and Restated Note Agreement
dated as of February 1, 1998, as amended by the First Amendment Agreement dated
as of September 7, 1999, among Canco and the financial institutions party
thereto as holders.
"Existing Stone Lenders"shall mean the "Lenders" under, and as defined in,
the Existing Stone Credit Agreement.
"Existing Stone Loan Documents" shall have the meaning assigned to the term
"Loan Documents" in the Existing Stone Credit Agreement.
"Existing Stone Term Facilities" shall mean the Tranche C Loans, the
Tranche D Loans, the Tranche E Loans and the Tranche F Loans, all as defined and
outstanding under the Existing Stone Credit Agreement.
"Facing Agent" shall mean Deutsche Bank Canada or any of its affiliates
that is a resident of Canada or any other Person that becomes a Facing Agent in
accordance with Article III.
"Federal Funds Effective Rate" shall mean, for any day, the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by it.
"Fees" shall mean the fees described in Section 2.05.
"Final Transaction Steps" shall mean the Canadian Amalgamations and other
distributions, liquidations and other transactions to be consummated following
the Closing Date pursuant to the Reorganization Agreement.
"Financial Officer" of any Person shall mean the chief financial officer,
principal accounting officer, treasurer, controller or assistant treasurer of
such Person.
"FinSub" shall mean Stone Receivables Corporation, a Delaware corporation.
"First Mortgage Note Indenture" shall mean the Indenture dated as of
October 12, 1994, between Stone and Norwest Bank, Minnesota, National
Association, as trustee, pursuant to which Stone issued its First Mortgage
Notes.
"First Mortgage Notes" shall mean Stone's 10-3/4% First Mortgage Notes due
2002.
"Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.
20
15
"Francobec Bond Pledge Agreement" shall mean the bond pledge agreement
dated as of May 31, 2000, entered into between Usine Francobec Inc. and the
Collateral Agent, providing the terms pursuant to which the Francobec Bonds are
to be held by the Collateral Agent, in its capacity as collateral agent and
depositary of the Francobec Bonds for the benefit of the Tranche H Lenders, the
Revolving Lenders, the Agents and the Facing Agent.
"Francobec Bonds" shall mean any or all of the Bonds issued from time to
time by Usine Francobec Inc. pursuant to the Francobec Hypothec. "Francobec
Hypothec" shall mean the Indenture and Deed of Hypothec and Issue of Bonds
executed on May 23, 2000, and entered into between Usine Francobec Inc. and the
Trustee, pursuant to the terms of which Usine Francobec Inc. has created, issued
and secured Bonds in the maximum aggregate amount of Cdn$1,500,000,000.00.
"Governmental Authority" shall mean any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
"Guarantee" of or by any Person shall mean any obligation, contingent or
otherwise (whether or not denominated as a guarantee), of such Person
guaranteeing any Indebtedness or any other obligation of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and including
any obligation of such Person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness (or
other obligation) or to purchase (or to advance or supply funds for the purchase
of) any security for the payment of such Indebtedness (or other obligation), (b)
to purchase property, securities or services for the purpose of assuring the
owner of such Indebtedness (or other obligation) of the payment of such
Indebtedness (or other obligation) or (c) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness (or other
obligation); provided, however, that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
amount of any Guarantee at any time shall be deemed to be an amount equal to the
lesser at such time of (x) the stated or determinable amount of the primary
obligation in respect of which such Guarantee is made or (y) the maximum amount
for which such Person may be liable pursuant to the terms of the instrument
embodying such Guarantee (or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof).
"Guarantee Agreements" shall mean the Canco Subsidiary Guarantee
Agreements, the Stone Guarantee Agreement, the Stone Subsidiary Guarantee
Agreements, and the Maryland Subsidiary Guarantee Agreement, made by each
Guarantor in favor of BTCo, as Collateral Agent, for the benefit of the
beneficiaries named therein.
"Guarantors" shall mean Stone, and each Subsidiary that executes a
Guarantee Agreement, including each Subsidiary listed on Schedule 1.01(b).
"Hazardous Materials" is defined in Section 4.16(d).
"Hypothecs" shall mean (a) each of the Canco Hypothec, the Francobec
Hypothec and the 2849 Hypothec and (b) any other such agreement entered into
thereafter by a Canadian Subsidiary and the Trustee.
21
16
"Inactive Subsidiary" shall mean any Subsidiary that (a) has assets with a
total market value not in excess of $1,000 and (b) has not conducted any
business or other operations during the prior 12-month period.
"Indebtedness" of any Person shall mean, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, other than deposits or advances in the ordinary course of
business, (b) all obligations of such Person evidenced by bonds, debentures,
notes or similar instruments, (c) all obligations of such Person under
conditional sale or other title retention agreements relating to assets
purchased by such Person, (d) all obligations of such Person issued or assumed
as the deferred purchase price of property or services (excluding trade accounts
payable and accrued expenses arising in the ordinary course of business), (e)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed by such Person, (f) all Guarantees
by such Person, (g) all Capital Lease Obligations of such Person, (h) all net
obligations of such Person in respect of Rate Protection Agreements, Currency
Agreements or other interest or exchange rate hedging arrangements (such net
obligations to be equal at any time to the termination value of such Agreements
or other arrangements that would be payable by or to such Person at such time)
and (i) all obligations of such Person as an account party to reimburse any bank
or any other Person in respect of letters of credit. The Indebtedness of any
Person shall include the Indebtedness of any partnership in which such Person is
a general partner, except to the extent such Indebtedness is expressly
non-recourse to such Person.
"Indemnitee" is defined in Section 11.05(b).
"Information" is defined in Section 11.15(a).
"Insolvency Law" shall mean, to the extent applicable, (a) Title 11 of the
United States Code, (b) the Bankruptcy and Insolvency Act (Canada), (c) the
Companies' Creditors Arrangement Act (Canada) and (d) any similar federal,
provincial, state, local or foreign bankruptcy or insolvency law, in each case
as now constituted or hereafter amended or enacted.
"Interest Payment Date" shall mean (a) with respect to any Loan, the last
day of the Interest Period applicable to the Borrowing of which such Loan is a
part and (b) with respect to any Eurodollar Borrowing with an Interest Period of
more than three months' duration, each day that would have been an Interest
Payment Date had successive Interest Periods of three months' duration been
applicable to such Borrowing.
"Interest Period" shall mean (a) as to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing or on the last day of the immediately
preceding Interest Period applicable to such Borrowing, as the case may be, and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter (or, if consented to by all affected Lenders, 9 or 12 months
thereafter), as the Borrower thereof may elect and (b) as to any ABR Borrowing
or Canadian Prime Rate Borrowing, the period commencing on the date of such
Borrowing or on the last day of the immediately preceding Interest Period
applicable to such Borrowing, as the case may be, and ending on the earlier of
(i) the next succeeding March 31, June 30, September 30 or December 31, and (ii)
the Term Loan Maturity Date or the Revolving Credit Maturity Date, as
applicable; provided, however, that, if any Interest Period would end on a day
other than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of a Eurodollar Borrowing only, such
next succeeding Business Day would fall in the next calendar month, in which
22
17
case such Interest Period shall end on the next preceding Business Day. Interest
shall accrue from and including the first day of an Interest Period to but
excluding the last day of such Interest Period.
"Investment" shall mean, as applied to any Person (the "investor"), any
direct or indirect purchase or other acquisition by the investor of, or a
beneficial interest in, stock or other securities of any other Person, including
any exchange of equity securities for Indebtedness, or any direct or indirect
loan, advance (other than advances to employees for moving and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business) or
capital contribution by the investor to any other Person, including all
Indebtedness and accounts receivable owing to the investor from such other
Person that did not arise from sales or services rendered to such other Person
in the ordinary course of the investor's business. The amount of any Investment
shall be the original cost of such Investment plus the cost of all additions
thereto, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment minus any
amounts (a) realized upon the disposition of assets comprising an Investment
(including the value of any liabilities assumed by any Person other than the
Borrowers or any Subsidiary in connection with such disposition), (b)
constituting repayments of Investments that are loans or advances or (c)
constituting cash returns of principal or capital thereon (including any
dividend, redemption or repurchase of equity that is accounted for, in
accordance with U.S. GAAP, as a return of principal or capital).
"ITA" shall mean the Income Tax Act (Canada), as amended, and any successor
thereto, and any regulations promulgated thereunder.
"JSG" shall mean Jefferson Smurfit Group plc, a corporation organized and
existing under the laws of the Republic of Ireland.
"Judgment Currency" is defined in Section 11.17.
"LC Disbursement" shall mean any payment or disbursement made by the Facing
Agent under or pursuant to a Letter of Credit.
"LC Exposure" shall mean, at any time of determination, the sum of (a) the
aggregate undrawn amount of all outstanding Letters of Credit at such time that
are denominated in U.S. Dollars, plus the U.S. Dollar Equivalent at such time of
the aggregate undrawn amount of all Letters of Credit that are denominated in
Canadian Dollars and (b) the aggregate amount of all LC Disbursements in respect
of Letters of Credit denominated in U.S. Dollars that have not been reimbursed
by Canco at such time, plus the U. S. Dollar Equivalent at such time of the
aggregate amount of all LC Disbursements in respect of Letters of Credit
denominated in Canadian Dollars that have not been reimbursed by Canco at such
time.
"LC Participation Fee" is defined in Section 2.05(c).
"LC Reserve Account" is defined in Section 10.02.
"Lenders" shall mean the Persons listed on Schedule 2.01 and (and their
respective successors which shall include any entity resulting from a merger or
consolidation) any other Person that shall have become a party hereto pursuant
to an Assignment and Acceptance other than any such Person that ceases to be a
party hereto pursuant to an Assignment and Acceptance.
"Letters of Credit" shall mean the letters of credit issued pursuant to the
terms and conditions of Article III.
23
18
"Liability Management Transactions" shall mean the series of transactions
described on Schedule 1.01(g) hereto.
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, assignment for security (whether collateral or otherwise),
hypothecation, prior claim (within the meaning of the Civil Code of Quebec),
encumbrance, charge or security interest in or on such asset, (b) the interest
of a vendor or a lessor under any conditional sale agreement, Capital Lease or
title retention agreement relating to such asset and (c) in the case of
securities, any purchase option, call or similar right of a third party with
respect to such securities.
"Loan Documents" shall mean this Agreement, the Letters of Credit, the
Security Documents and the Guarantee Agreements.
"Loan Parties" shall mean the Borrowers and the Guarantors.
"Loans" shall mean the Revolving Loans and the Term Loans.
"Majority Vote" shall mean, as of the date of determination thereof, with
respect to Lenders holding Loans or Commitments in respect of any particular
Credit Facility hereunder, Lenders having greater than 50% of the sum of (i) the
aggregate principal amount of Loans outstanding under such Credit Facility and
other extensions of credit then outstanding under any of the Loan Documents
relating to such Credit Facility plus (ii) the aggregate amount of the remaining
available Commitments of the Lenders with respect to such Credit Facility under
any of the Loan Documents; provided, however, that for purposes of determining
the amount of a Revolving Lender's Loans, each Revolving Lender shall be deemed
to hold the amount of LC Exposure equal to its Applicable Percentage of LC
Exposure then outstanding.
"Margin Stock" shall have the meaning given such term under Regulation U.
"Maryland Subsidiary Guarantee Agreement" shall mean the guarantee
agreement dated as of the date hereof substantially in the form of Exhibit C-4
by the subsidiaries of Stone party thereto in favor of BTCo, as Collateral
Agent.
"Material Adverse Effect" shall mean (a) a materially adverse effect on the
business, operations, properties or condition (financial or otherwise) of Stone
and its Subsidiaries, taken as a whole, (b) material impairment of the ability
of any Loan Party to perform any of its obligations under any Loan Document to
which it is or will be a party or (c) material impairment of the rights of or
benefits available to the Agents, the Administrative Agent, the Facing Agent or
the Lenders under any Loan Document.
"Material Contract" shall mean any contract to which either Borrower or any
of the Subsidiaries is or becomes a party providing for payments by or to either
Borrower or any of the Subsidiaries in excess of $50,000,000 per year and the
duration of which shall be in excess of twelve months.
"Material Subsidiary" shall mean each Subsidiary now existing or hereafter
acquired or formed and each successor thereto that (a) for the most recent
fiscal year of Stone accounted for more than 5% of the consolidated revenues of
Stone, (b) as at the end of such fiscal year, was the owner of more than 5% of
the consolidated assets of Stone, as shown on the consolidated financial
statements of Stone for such fiscal year or (c) is designated as a Material
Subsidiary on
24
19
Schedule 1.01(c) or is otherwise irrevocably designated as a
Material Subsidiary in a writing by a Loan Party to the Administrative Agent.
"Maximum Rate" is defined in Section 11.10.
"MBI Transaction" shall mean the acquisition of the remaining 50% of the
equity interests of MBI Limited by SSCC with a contribution of such equity
interests to Stone and its Subsidiaries, or the acquisition of such equity
interests by Stone or any Subsidiary solely using proceeds of an Investment made
by SSCC to Stone.
"Mortgaged Properties" shall mean the real properties of Canco, SLP US and
their respective subsidiaries specified on Schedule 1.01(d).
"Mortgages" shall mean (i) the mortgages each substantially in the form of
Exhibit D and (ii) the deeds of trust, hypothecs, debentures, leasehold
mortgages, assignments of leases and rents, modifications and other security
documents listed on Schedule 1.01(e) and each such document delivered pursuant
to Section 6.10.
"Multiemployer Plan" shall mean a multiemployer plan as defined in Section
4001(a)(3) of ERISA to which either Borrower or any ERISA Affiliate (other than
one considered an ERISA Affiliate only pursuant to subsection (m) or (o) of
Section 414 of the Code) is making or accruing an obligation to make
contributions, or has within any of the preceding five plan years made or
accrued an obligation to make contributions.
"Net Cash Proceeds" shall mean (a) with respect to any Asset Sale, the Cash
Proceeds, net of (i) costs of sale (including payment of the outstanding
principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than Loans) required to be repaid under the terms thereof as
a result of such Asset Sale), (ii) taxes paid or reasonably estimated to be paid
in the year such Asset Sale occurs or in the following year as a result thereof
and (iii) amounts provided as a reserve, in accordance with U.S. GAAP against
any liabilities under any indemnification obligations and any purchase price
adjustments associated with such Asset Sale (provided that, to the extent and at
the time any such amounts are released from such reserve, such amounts shall
constitute Net Cash Proceeds); and (b) with respect to any issuance of debt or
equity securities or any capital contribution, the cash proceeds thereof, net of
underwriting commissions or placement fees and expenses directly incurred in
connection therewith; provided, however, that the definition of the term "Net
Cash Proceeds" shall not include any Cash Proceeds resulting from a casualty or
condemnation that are used (or contractually committed to being used) for the
replacement of the assets subject to such casualty or condemnation within 270
days of the receipt by either Borrower or any Subsidiary of such Cash Proceeds.
"Non-U.S. Person" is defined in Section 2.20(f).
"Obligations" shall mean all obligations of every nature, including amounts
drawn under outstanding Letters of Credit, of Loan Parties from time to time
owed to the Agents, the Administrative Agent, the Facing Agent and the Lenders,
or any of them, under the Loan Documents.
"Other Taxes" is defined in Section 2.20(b).
"Participating Subsidiary" shall mean any Subsidiary that participates or
is permitted to participate in the Receivables Program pursuant to the
Receivable Program Documents.
25
20
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Permitted Investments" shall mean any of the following:
(a) any evidence of Indebtedness, maturing not more than one year
after the acquisition thereof, issued by the United States of America or
the federal government of Canada, or any instrumentality or agency thereof
and guaranteed fully as to principal, interest and premium, if any, by the
United States of America or the federal government of Canada;
(b) any certificate of deposit, maturing not more than one year after
the date of purchase, issued by a commercial banking institution that has
long-term debt rated "A" or higher by Xxxxx'x Investors Service, Inc. or
Standard & Poor's Ratings Services and which has a combined capital and
surplus and undivided profits of not less than $500,000,000;
(c) commercial paper (i) maturing not more than 270 days after the
date of purchase and (ii) issued by (x) a corporation (other than a Loan
Party or any Affiliate of a Loan Party) with a rating, at the time as of
which any determination thereof is to be made, of "P-1" or higher by
Xxxxx'x Investors Service, Inc. or "A-1" or higher by Standard & Poor's
Ratings Services (or equivalent rating in the case of a Permitted
Investment made by a Foreign Subsidiary) or (y) any Agent;
(d) demand deposits with any bank or trust company;
(e) repurchase agreements with a term of not more than seven days with
respect to Indebtedness issued by the United States of America, or any
instrumentality or agency thereof and guaranteed fully as to principal,
interest and premium, if any, by the United States of America; and
(f) in the case of the Foreign Subsidiaries, short-term investments
comparable to the foregoing.
"Permitted Liens" shall mean:
(a) Liens for taxes, assessments or other governmental charges or
levies not yet due and payable or which are being contested in good faith
by appropriate proceedings diligently pursued, provided that (i) any
proceedings commenced for the enforcement of such Liens shall have been
duly suspended and (ii) full provision for the payment of all such taxes
known to such Person has been made on the books of such Person if and to
the extent required by U.S. GAAP;
(b) mechanics', materialmen's, carriers', warehousemen's, landlord's
and similar Liens arising by operation of law and in the ordinary course of
business and securing obligations of such Person that are not overdue for a
period of more than 60 days or are being contested in good faith by
appropriate proceedings diligently pursued, provided that in the case of
any such contest (i) any proceedings commenced for the enforcement of such
Liens shall have been duly suspended and (ii) full provision for the
payment of such Liens has been made on the books of such Person if and to
the extent required by U.S. GAAP;
26
21
(c) Liens arising in connection with worker's compensation,
unemployment insurance, old age pensions and social security benefits that
are not overdue or are being contested in good faith by appropriate
proceedings diligently pursued, provided that in the case of any such
contest (i) any proceedings commenced for the enforcement of such Liens
shall have been duly suspended and (ii) full provision for the payment of
such Liens has been made on the books of such Person if and to the extent
required by U.S. GAAP;
(d) (i) Liens incurred or deposits made in the ordinary course of
business to secure the performance of bids, tenders, statutory obligations,
fee and expense arrangements with trustees and fiscal agents (exclusive of
obligations incurred in connection with the borrowing of money or the
payment of the deferred purchase price of property) and (ii) Liens securing
surety, indemnity, performance, appeal and release bonds, in the case of
either clause (i) or (ii), securing such bonds in an amount not to exceed
individually or in the aggregate $25,000,000 at any time outstanding,
provided that full provision for the payment of all such obligations has
been made on the books of such Person if and to the extent required by U.S.
GAAP;
(e) imperfections of title, covenants, restrictions, rights of way,
easements, servitudes, mineral interest reservations, reservations made in
the grant from the Crown, municipal and zoning ordinances, general real
estate taxes and assessments not yet delinquent and other encumbrances on
real property that (i) do not arise out of the incurrence of any
Indebtedness for money borrowed and (ii) do not interfere with or impair in
any material respect the utility, operation, value or marketability of the
real property on which such Lien is imposed;
(f) the rights of collecting banks or other financial institutions
having a right of setoff, revocation, refund or chargeback with respect to
money or instruments on deposit with or in the possession of such financial
institution;
(g) any Lien specifically permitted to be suffered or incurred under
any applicable Security Document;
(h) leases or subleases granted to others not interfering in any
material respect with the business of either Borrower or any Subsidiary and
any interest or title of a lessor under any lease (whether a Capital Lease
or an operating lease) permitted by this Agreement or the Security
Documents;
(i) Liens on accounts receivable for which attempts at collection have
been undertaken by a third party authorized by the Person owning such
accounts receivable;
(j) Liens arising from the granting of a license to enter into or use
any asset of either Borrower or any Subsidiary to any Person in the
ordinary course of business of either Borrower or any Subsidiary that does
not interfere in any material respect with the use or application by such
Borrower or any Subsidiary of the asset subject to such license;
(k) Liens attaching solely to xxxx xxxxxxx money deposits made by
either Borrower or any Subsidiary in connection with any letter of intent
or purchase agreement entered into it in connection with an acquisition
permitted hereunder;
(l) Liens arising from precautionary UCC financing statements (or
analogous personal property security filings in other jurisdictions)
regarding operating leases; and
27
22
(m) Liens arising by operation of law on insurance policies and
proceeds thereof to secure premiums thereunder.
For the purposes of the Security Documents and Section 4.18, "Permitted Liens"
shall also be deemed to include the Liens permitted by Sections 7.02(ii), (vi),
(vii), (ix), (xi), (xii) and (xiii). Any reference in any of the Loan Documents
to a Permitted Lien is not intended to and shall not be interpreted as
subordinating or postponing, or as any agreement to subordinate or postpone, any
Lien created by any of the Loan Documents to any Permitted Lien.
"Person" shall mean any natural person, corporation, legal person, business
trust, joint venture, association, company, limited liability company,
partnership or government, or any agency or political subdivision thereof.
"Plan" shall mean any pension plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code that
is maintained for employees of either Borrower or any ERISA Affiliate.
"Pledge Agreements" shall mean the U.S. Pledge Agreement and the Canadian
Pledge Agreements.
"Post Closing Distributions" shall mean the distributions to be made
pursuant to Section 2.3 of the Reorganization Agreement.
"Pre-Merger Agreement" is defined in the preamble to this Agreement.
"Prepayment Account" is defined in Section 2.13(h).
"Prime Rate" shall mean the rate of interest per annum publicly announced
from time to time by the Administrative Agent as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced as being effective.
"Program Receivables" shall mean all trade receivables and related contract
and other rights and property (including all general intangibles, collections
and other proceeds relating thereto, all security therefor and any goods that
have been repossessed in connection with any thereof) sold or contributed by
Stone or any Subsidiary to FinSub pursuant to the Receivables Program Documents.
"Rate Protection Agreements" shall mean interest rate cap agreements,
interest rate swap agreements and other agreements or arrangements entered into
in the ordinary course of business by either Borrower or any Subsidiary and
designed to protect such Borrower or such Subsidiary against fluctuations in
interest rates or to obtain the benefit of floating interest rates.
"Real Properties" shall mean each parcel of real property identified on
Schedule 4.20, together with all fixtures thereon.
"Receivables Program" shall mean that certain trade receivables
securitization program conducted pursuant to the Receivables Program Documents.
"Receivables Program Documents" shall mean the documents identified on
Schedule 1.01(f) and all other documentation entered into pursuant to the
Receivables Program.
28
23
"Register" is defined in Section 11.04(d).
"Regulation T" shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation U" shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Regulation X" shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
"Reorganization Agreement" shall mean the Reorganization Agreement dated as
of May 31, 2000, by and among SSCC, Stone, Stone Container Corporation-Canada,
Canco and the other Subsidiaries signatory thereto, attached hereto as Exhibit
H.
"Reportable Event" shall mean any reportable event as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than a Plan maintained by an ERISA Affiliate that is considered an ERISA
Affiliate only pursuant to subsection (m) or (o) of Section 414 of the Code).
"Required Lenders" shall mean, as of the date of determination thereof, the
Lenders having greater than 50% of the sum of (i) the aggregate principal amount
of Loans and other extensions of credit then outstanding under any of the Loan
Documents plus (ii) the aggregate amount of the remaining available Commitments
of the Lenders under any of the Loan Documents; provided, however, that for
purposes of determining the amount of a Revolving Lender's Loans, each Revolving
Lender shall be deemed to hold the amount of LC Exposure equal to its Applicable
Percentage of the LC Exposure then outstanding.
"Reset Date" is defined in Section 1.04.
"Responsible Officer" of any Person shall mean any executive officer or
Financial Officer of such Person and any other officer or similar official
thereof responsible for the administration of the obligations of such Person in
respect of this Agreement.
"Restricted Payment" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of stock of either
Borrower or any of the Subsidiaries, now or hereafter outstanding, except (i)
any dividend payable solely in shares of such class of stock to the holders of
such class and (ii) any dividend or distribution made by any Subsidiary ratably
to the holders of the common stock of such Subsidiary, and (b) any redemption,
retirement, sinking fund or similar payment, purchase, exchange or other
acquisition for value, direct or indirect, of any shares of any class of stock
of either Borrower or any of the Subsidiaries, now or hereafter outstanding,
except for any such redemption, retirement, sinking fund or similar payment
payable only to a Loan Party or payable from a Foreign Subsidiary to another
Foreign Subsidiary.
"Revolving Credit Availability Period" shall mean the period commencing
with the Closing Date and ending on the Revolving Credit Maturity Date.
"Revolving Credit Borrowing" shall mean a Borrowing comprised of Revolving
Loans.
"Revolving Credit Commitment" shall mean, with respect to each Revolving
Lender, the commitment of such Revolving Lender to make Revolving Loans and
acquire participations in
29
24
Letters of Credit hereunder as set forth on Schedule 2.01 or in the Assignment
and Acceptance pursuant to which such Revolving Lender assumed its Revolving
Credit Commitment, as applicable, as the same may be (a) reduced from time to
time pursuant to Section 2.09 and (b) reduced or increased from time to time
pursuant to assignments by or to such Revolving Lender pursuant to Section
11.04. The initial aggregate amount of the Lenders' Revolving Credit Commitments
is U.S.$100,000,000.
"Revolving Credit Maturity Date" shall mean December 31, 2005.
"Revolving Credit Utilization" shall mean, at any time of determination,
the sum of (a) the aggregate principal amount of Revolving Loans outstanding at
such time and denominated in U.S. Dollars, plus the U.S. Dollar Equivalent of
the aggregate principal amount of Revolving Loans outstanding at such time and
denominated in Canadian Dollars and (b) the LC Exposure at such time.
"Revolving Lenders" shall mean the Lenders having Revolving Credit
Commitments or holding Revolving Loans, which, prior to any CAM Exchange, shall
be resident in Canada for purposes of the ITA.
"Revolving Loans" shall mean the revolving loans made by the Revolving
Lenders to Canco, including by way of Bankers' Acceptances and B/A Equivalent
Loans, pursuant to Section 2.01(b) or Section 2.22.
"SCC AMMI" shall mean SCC Active Medical Management, Inc.
"SCC Xxxxx" shall mean SCC Xxxxx, Inc., a Delaware corporation.
"SCC Xxxxx Note" shall mean a promissory note issued by SCC Xxxxx to Stone
in a principal amount up to U.S.$330,000,000.
"SCC RMMI" shall mean SCC Retiree Medical Management, Inc.
"Schedule I Bank" shall mean a bank that is a Canadian chartered bank
listed on Schedule I under the Bank Act (Canada).
"Schedule II Bank" shall mean a bank that is a Canadian chartered bank
listed on Schedule II under the Bank Act (Canada).
"Schedule II Reference Banks" shall mean each of Deutsche Bank Canada and
The Chase Manhattan Bank of Canada and such other Schedule II Banks as are
agreed to from time to time by Canco and the Canadian Administrative Agent;
provided that there shall be no more than three Schedule II Reference Banks at
any one time.
"Security Agreements" shall mean the U.S. Security Agreement and the
Canadian Security Agreement.
"Security Documents" shall mean the Mortgages, the Security Agreements, the
Hypothecs, the Bond Pledge Agreements, the Bonds and the Pledge Agreements.
"Senior Notes" shall mean the Senior Notes due 2004, the Senior Notes due
2006 and the Senior Notes due 2016.
30
25
"Senior Notes due 2004" shall mean Stone's 11-1/2% Senior Notes due 2004.
"Senior Notes due 2006" shall mean Stone's 11-1/2% Senior Notes due 2006.
"Senior Notes due 2016" shall mean Stone's Adjustable Rate Senior Notes due
2016.
"Senior Subordinated Notes due 2002" shall mean Stone's 10-3/4% Senior
Subordinated Debentures due 2002 and Stone's 12-1/4% Senior Subordinated
Debentures due 2002.
"Series E Preferred Stock" shall mean the Series E Preferred Stock of Stone
outstanding as of the Closing Date.
"SLP Acquisition Documents" shall mean the Pre-Merger Agreement, the
Reorganization Agreement and any other material agreements, instruments or other
documents entered into, or delivered by, between or among the parties to the
Pre-Merger Agreement and any of their respective Affiliates in connection with
the Acquisition.
"SLP Credit Parties" shall mean SLP US and its Subsidiaries.
"SLP US" shall mean St. Laurent Paperboard (U.S.) Inc., a Delaware
corporation, which, upon completion of the Final Transaction Steps, will be a
direct, wholly owned subsidiary of Stone and which will hold, directly or
indirectly, substantially all the U.S. assets and operations of Canco as of the
Closing Date.
"Specified Senior Indentures" shall mean each of the indentures and
supplemental indentures relating to the Senior Notes and the First Mortgage
Notes and any other similar indenture, agreement or instrument entered into at
any time by either Borrower or any Subsidiary.
"SSCC" is defined in the preamble to this Agreement.
"Standard Time" shall mean eastern standard time or eastern daylight
savings time, as applicable on the relevant date.
"Statutory Reserves" shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum applicable reserve percentages, including
any marginal, special, emergency or supplemental reserves (expressed as a
decimal) established by the Board and any other banking authority to which the
Administrative Agent is subject for Eurocurrency Liabilities (as defined in
Regulation D of the Board). Eurodollar Loans shall be deemed to constitute
Eurocurrency Liabilities and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D. Statutory Reserves
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"Stone" is defined in the preamble to this Agreement.
"Stone Guarantee Agreement" shall mean the guarantee agreement dated as of
the date hereof substantially in the form of Exhibit C-2 by Stone in favor of
BTCo, as Collateral Agent.
"Stone Subsidiary Guarantee Agreement" shall mean the guarantee agreement
dated as of the date hereof substantially in the form of Exhibit C-3 in favor of
BTCo, as Collateral Agent, by
31
26
SLP US and each existing or subsequently acquired or organized direct or
indirect wholly owned Domestic Subsidiary of SLP US required to become a party
thereto pursuant to Section 6.10.
"Subordinated Notes" shall mean the Senior Subordinated Notes due 2002 and
the Subordinated Notes due 2007.
"Subordinated Notes due 2007" shall mean Stone's 6-3/4% Convertible
Subordinated Debentures due 2007.
"subsidiary" shall mean, with respect to any Person (herein referred to as
the "parent"), any corporation, partnership, association or other business
entity of which securities or other ownership interests representing more than
50% of the equity or more than 50% of the ordinary voting power or more than 50%
of the general partnership or membership interests are, at the time any
determination is being made, owned, controlled or held by, or otherwise
Controlled by, the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.
"Subsidiary" shall mean any subsidiary of either Borrower; provided,
however, that the term "Subsidiary" shall not include (a) any Inactive
Subsidiary and (b) Stone Venepal (Celgar) Pulp, Inc.
"Term Borrowing" shall mean a Borrowing comprised of Tranche G Loans and
Tranche H Loans.
"Term Loan Commitments" shall mean the Tranche G Commitments and the
Tranche H Commitments.
"Term Loan Maturity Date" shall mean December 31, 2006.
"Term Loan Repayment Amounts" shall mean, for any period, the aggregate of
all Tranche G Repayment Amounts and Tranche H Repayment Amounts payable during
such period.
"Term Loan Repayment Dates" shall mean the Tranche G Loan Repayment Dates
and the Tranche H Loan Repayment Dates.
"Term Loans" shall mean the Tranche G Loans and the Tranche H Loans.
"Tranche F Loans" means the Tranche F Loans outstanding under, and as
defined in, the Existing Stone Credit Agreement.
"Tranche G Commitments" shall mean, with respect to each Tranche G Lender,
the commitment of such Lender to make Tranche G Loans hereunder to Stone as set
forth in Schedule 2.01, as the same may be reduced from time to time pursuant to
Section 2.09. The initial aggregate principal amount of the Tranche G
Commitments is U.S.$450,000,000.
"Tranche G Lenders" means Lenders with Tranche G Commitments or outstanding
Tranche G Loans.
"Tranche G Loans" shall mean the term loans made by the Tranche G Lenders
to Stone pursuant to Section 2.01(a)(i).
"Tranche G Loan Repayment Amounts" is defined in Section 2.11(a)(i).
32
27
"Tranche G Loan Repayment Dates" is defined in Section 2.11(a)(i).
"Tranche H Commitment" shall mean with respect to each Tranche H Lender,
the commitment of such Tranche H Lender to make Tranche H Loans hereunder to
Canco as set forth in Schedule 2.01, as the same may be reduced from time to
time pursuant to Section 2.09. The initial aggregate principal amount of the
Tranche H Commitments is U.S.$500,000,000.
"Tranche H Lenders" shall mean Lenders with Tranche H Commitments or
outstanding Tranche H Loans.
"Tranche H Loans" shall mean the term loans made by Tranche H Lenders to
Canco pursuant to Section 2.01(a)(ii).
"Tranche H Loan Repayment Amounts" is defined in Section 2.11(a)(ii).
"Tranche H Loan Repayment Dates" is defined in Section 2.11(a)(ii).
"Transactions" shall have the meaning assigned to such term in Section
4.02.
"Trustee" shall mean General Trust of Canada, a trust company constituted
under An Act Respecting Trust Companies and Savings Companies (Quebec) and Part
1 of the Companies Act (Quebec), in its capacity as "fonde de pouvoir" (person
holding the power of attorney) for the holders of the Bonds.
"Type", when used in respect of any Loan or Borrowing, shall refer to the
Rate by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined. For purposes hereof, the term "Rate" shall include the
Adjusted LIBO Rate, the Alternate Base Rate, the Canadian Prime Rate and the
Discount Rate applicable to B/A and B/A Equivalent Loans.
"U.S. Base Rate" shall mean the rate of interest per annum publicly
announced from time to time by the Canadian Administrative Agent as its base
rate in effect at its principal office in Toronto, Ontario for determining
interest rates on U.S. Dollar-denominated commercial loans made in Canada; each
change in the U.S. Base Rate shall be effective on the date such change is
publicly announced as being effective.
"U.S. Dollars" or "U.S. $" shall mean lawful currency of the United States.
"U.S. Dollar Equivalent" shall mean, on any date of determination, with
respect to any amount in Canadian Dollars, the equivalent in U.S. Dollars of
such amount determined by the Administrative Agent using the Exchange Rate then
in effect.
"U.S. GAAP" shall mean generally accepted accounting principles in the
United States, applied on a consistent basis.
"U.S. Pledge Agreement" shall mean the Pledge Agreement, substantially in
the form of Exhibit E-2, among Stone, SLP US, the wholly owned Subsidiaries of
SLP US party thereto as pledgors and BTCo, as Collateral Agent.
"U.S. Security Agreement" shall mean the Security Agreement, substantially
in the form of Exhibit F-2, among SLP US, the wholly owned subsidiaries of SLP
US party thereto as grantors and BTCo, as Collateral Agent.
33
28
"wholly owned Canadian Subsidiary" shall mean each wholly owned subsidiary
of either Borrower that is a Canadian Subsidiary.
"wholly owned Domestic Subsidiary" shall mean any wholly owned subsidiary
of either Borrower that is a Domestic Subsidiary.
"wholly owned subsidiary" of a Person shall mean any subsidiary of such
Person of which securities (except for directors' qualifying shares) or other
ownership interests representing 100% of the equity or 100% of the ordinary
voting power or 100% of the general partnership or membership interests are, at
the time any determination is being made, owned, controlled or held by such
Person or one or more subsidiaries of such Person or by such Person and one or
more subsidiaries of such Person.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Terms Generally. The definitions in Section 1.01 shall apply
equally to both the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". All references
herein to Articles, Sections, Exhibits and Schedules shall be deemed to be
references to Articles and Sections of, and Exhibits and Schedules to, this
Agreement unless the context shall otherwise require. Each reference to any Loan
Document or any other document or agreement shall be deemed to be a reference to
such Loan Document, document or agreement as amended, restated, waived,
supplemented or otherwise modified from time to time in accordance with the
provisions hereof and thereof. 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 U.S. GAAP as in effect from time to time,
applied on a basis consistent with the application used in the financial
statements referred to in Section 4.05; provided, however, that for purposes of
making any determination required by the definition of "Applicable Rate",
Section 2.13(c) or Article VII, all accounting terms used herein shall be
interpreted and all accounting determinations hereunder shall be made in
accordance with U.S. GAAP as in effect on the Closing Date applied on a basis
consistent with the application used in the financial statements referred to in
Section 4.05(a).
SECTION 1.03. Classification of Loans and Borrowings. For the purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class and Type
(e.g., a "Eurodollar Revolving Loan"). Borrowings may also be classified and
referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a
"Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar Revolving
Borrowing").
SECTION 1.04. Exchange Rate Calculations. On each Calculation Date, the
Administrative Agent shall (a) determine the Exchange Rate as of such
Calculation Date and (b) give notice thereof to the Borrowers and to each Lender
that shall have requested such information. The Exchange Rates so determined
shall become effective on the first Business Day immediately following the
relevant Calculation Date (each, a "Reset Date") and shall remain effective
until the next succeeding Reset Date, and shall for all purposes of this
Agreement (other than Section 2.02(e), Section 10.03, Section 11.17 and any
other provision expressly requiring the use of a current Exchange Rate) be the
Exchange Rate employed in converting amounts between U.S. Dollars and Canadian
Dollars.
34
29
ARTICLE II
The Credits
SECTION 2.01. Commitments and Loans. (a) Subject to the terms and
conditions and relying on the representations and warranties of the Borrowers
set forth herein, (i) each Tranche G Lender agrees, severally and not jointly,
to make a Tranche G Loan in U.S. Dollars to Stone on the Closing Date in a
principal amount not to exceed its Tranche G Commitment, and (ii) each Tranche H
Lender agrees, severally and not jointly, to make a Tranche H Loan in U.S.
Dollars to Canco on the Closing Date in a principal amount not to exceed its
Tranche H Commitment. Amounts paid or repaid in respect of Term Loans may not be
reborrowed.
(b) Subject to the terms and conditions and relying on the representations
and warranties of the Borrowers set forth herein, each Revolving Lender agrees,
severally and not jointly, to make Revolving Loans, including by means of a B/A
or B/A Equivalent Loan, to Canco from time to time during the Revolving Credit
Availability Period, in U.S. Dollars or Canadian Dollars (as requested by
Canco), in an aggregate principal amount that will not result in (i) such
Revolving Lender's Applicable Percentage of the Revolving Credit Utilization
exceeding such Revolving Lender's Revolving Credit Commitment or (ii) the
aggregate Revolving Credit Utilization exceeding the aggregate Revolving Credit
Commitments. Within the limits set forth in the preceding sentence, Canco may
borrow, pay or prepay and reborrow Revolving Loans.
SECTION 2.02. Loans. (a) Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
respective applicable Tranche G Commitments, Tranche H Commitments, or Revolving
Credit Commitments, as the case may be; provided, however, that the failure of
any Lender to make any Loan shall not in itself relieve any other Lender of its
obligation to lend hereunder (it being understood, however, that no Lender shall
be responsible for the failure of any other Lender to make any Loan required to
be made by such other Lender). Loans comprising any Borrowing shall, subject to
Section 2.22(e) in the case of B/A Borrowings, be in an aggregate principal
amount that is (i) an integral multiple of U.S.$500,000 (or the Canadian Dollar
Equivalent thereof) and, in the case of a Eurodollar Borrowing, not less than
U.S.$1,000,000 or (ii) an aggregate principal amount equal to the remaining
available balance of the applicable Commitments.
(b) Subject to Section 2.08 and 2.15, (i) each Term Borrowing and Revolving
Credit Borrowing denominated in U.S. Dollars shall be comprised entirely of ABR
Loans or Eurodollar Loans, and (ii) each Revolving Credit Borrowing denominated
in Canadian Dollars shall be comprised entirely of B/A Loans or Canadian Prime
Rate Loans, in each case as the Borrower may request pursuant to Section 2.03.
Each Lender may at its option fulfill its Commitment with respect to any
Eurodollar Loan or any Loan denominated in Canadian Dollars by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan,
provided that any exercise of such option shall not (A) affect the obligation of
the applicable Borrower to repay such Loan in accordance with the terms of this
Agreement or (B) require any reimbursement or other payment to be made to such
Lender or its Affiliates pursuant to Section 2.20 in an amount in excess of the
amounts that would have been payable thereunder to such Lender had such Lender
not exercised such option. Borrowings of more than one Type may be outstanding
at the same time; provided, however, that the Borrowers shall not be entitled to
request any Borrowing that, if made, would result in an aggregate of more than
fifteen separate Eurodollar Loans and five B/A Borrowings of any Lender being
outstanding hereunder at any one time. For purposes of the foregoing, Loans
35
30
having different Interest Periods or Contract Periods or denominated in
different currencies, regardless of whether they commence on the same date,
shall be considered separate Loans.
(c) Subject to paragraph (e) below, each Lender shall make a Loan in the
amount of its pro rata portion, as determined under Section 2.17, of each
Borrowing hereunder on the proposed date thereof by wire transfer of immediately
available funds to the Administrative Agent in New York, New York (or to the
Canadian Administrative Agent in Xxxxxxx, Xxxxxxx, in the case of any Loan
denominated in Canadian Dollars), not later than 2:00 p.m., Standard Time, and
the Administrative Agent shall promptly credit the amounts so received to the
general deposit account of the Borrower or, if a Borrowing shall not occur on
such date because any condition precedent specified herein shall not have been
met, return the amounts so received to the respective Lenders. Unless the
Administrative Agent shall have received notice from a Lender prior to the date
of any Borrowing (or, in the case of an ABR Revolving Borrowing or Canadian
Prime Rate Borrowing, prior to 2:00 p.m., Standard Time, on the date of such
Borrowing) that such Lender will not make available to the Administrative Agent
such Lender's portion of such Borrowing, the Administrative Agent may assume
that such Lender has made such portion available to the Administrative Agent on
the date of such Borrowing in accordance with this paragraph (c) and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have made such portion available to the
Administrative Agent, such Lender and such 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 such Borrower until the date such amount is repaid to the Administrative
Agent at (i) in the case of such Borrower, the interest rate applicable at the
time to the Loans comprising such Borrowing and (ii) in the case of such Lender,
the Federal Funds Effective Rate or, in the case of a Revolving Credit Borrowing
denominated in Canadian Dollars, the rate determined by the Administrative Agent
to represent its cost of obtaining overnight Canadian Dollars. If such Lender
shall repay to the Administrative Agent such corresponding amount, such amount
shall be deemed to constitute such Lender's Loan as part of such Borrowing for
purposes of this Agreement.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request any Interest Period (or Contract Period in the
case of a B/A Borrowing) with respect to any Revolving Credit Borrowing that
would end after the Revolving Credit Maturity Date.
(e) If the Facing Agent has not received from Canco the payment required by
paragraph (d) of Article III within two hours after Canco shall have received
notice from the Facing Agent that payment of a drawing presented under any
Letter of Credit will be made or, if Canco shall have received such notice later
than 10:00 a.m., Standard Time, on any Business Day, not later than 10:00 a.m.,
Standard Time, on the immediately following Business Day, as provided in
paragraph (a) of Article III, the Facing Agent will promptly notify the Canadian
Administrative Agent of the LC Disbursement and the Administrative Agent will
promptly notify each Revolving Lender of such LC Disbursement and its Applicable
Percentage thereof. Each Revolving Lender will pay to the Canadian
Administrative Agent not later than 4:00 p.m., Standard Time on such date (or,
if the Revolving Lenders shall have received such notice later than 2:00 p.m.,
Standard Time, on any day, not later than 10:00 a.m., Standard Time, on the
immediately following Business Day) an amount equal to such Revolving Lender's
Applicable Percentage of such LC Disbursement (it being understood that such
amount shall be deemed to constitute an ABR Revolving Loan or Canadian Prime
Rate Revolving Loan, as the case may be, of such Revolving Lender), and the
Canadian Administrative Agent will promptly pay such amount to the Facing Agent.
The Canadian Administrative Agent will promptly remit to each Revolving Lender
its Applicable Percentage of any amounts subsequently received by the Canadian
Administrative Agent from the Borrower in
36
31
respect of such LC Disbursement. If any Lender shall not have made its
Applicable Percentage of such LC Disbursement available to the Facing Agent as
provided above, such Lender agrees to pay interest on such amount, for each day
from and including the date such amount is required to be paid in accordance
with this subsection to but excluding the date an amount equal to such amount is
paid to the Canadian Administrative Agent for prompt payment to the Facing Agent
at, for the first such day, the overnight Canadian interbank rate for U.S.
Dollars or Canadian Dollars, as the case may be, and for each day thereafter,
the Alternate Base Rate or the Canadian Prime Rate, as the case may be.
SECTION 2.03. Notice of Borrowings. The applicable Borrower shall give the
Administrative Agent written or telecopy notice (or telephone notice promptly
confirmed in writing or by telecopy) (a) in the case of a Eurodollar Borrowing,
not later than 11:00 a.m., Standard Time, three Business Days before a proposed
borrowing, (b) in the case of an ABR Borrowing or a Canadian Prime Rate
Borrowing, not later than 11:00 a.m., Standard Time, on the day of a proposed
borrowing, and (c) in the case of a B/A Borrowing, not later than 11:00 a.m.,
Standard Time, one Business Day before a proposed Borrowing. Such notice shall
be irrevocable and shall in each case refer to this Agreement and specify the
following information:
(i) the Borrower requesting such Borrowing;
(ii) the Type (e.g., Eurodollar, ABR, B/A or Canadian Prime Rate) and
Class (e.g., Revolving, Tranche G or Tranche H) of such Borrowing;
(iii) the aggregate amount and currency of such Borrowing;
(iv) the date of such Borrowing (which shall be a Business Day);
(v) in the case of a Eurodollar Borrowing, the Interest Period with
respect thereto;
(vi) in the case of a B/A Borrowing, the Contract Period and maturity
date with respect thereto; and
(vii) the number and location of the account to which funds are to be
disbursed;
provided, however, that, notwithstanding any contrary specification in any such
notice, each requested Borrowing shall comply with the requirements set forth in
Section 2.02. If no election as to the Type of Borrowing is specified in any
such notice, then the requested Borrowing shall be an ABR Borrowing if
denominated in U.S. Dollars and a Canadian Prime Rate Borrowing if denominated
in Canadian Dollars. If no Interest Period with respect to any Eurodollar
Borrowing (or Contract Period, with respect to a B/A Borrowing) is specified in
any such notice, then the Borrower shall be deemed to have selected an Interest
Period (or Contract Period in the case of a B/A Borrowing) of one month's (or 30
days', in the case of a B/A Borrowing) duration. The Administrative Agent shall
promptly advise the Lenders of any notice given pursuant to this Section, and of
each Lender's portion of the requested Borrowing, but in any event prior to
12:00 noon, Standard Time, for same day Borrowings.
SECTION 2.04. Repayment of Loans; Evidence of Debt. (a) Canco hereby
unconditionally promises to pay (i) to the Canadian Administrative Agent for the
account of each Revolving Lender the then unpaid principal amount of each
Revolving Loan of such Lender on the Revolving Credit Maturity Date and (ii) to
the Canadian Administrative Agent for the account of each Tranche H Lender the
then unpaid principal amount of each Tranche H Loan of such Lender in such
amounts
37
32
and on such dates as provided in Section 2.11(a)(ii). Stone hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Tranche G Lender the then unpaid principal amount of each Tranche G Loan of
such Lender in such amounts and on such dates as provided in Section 2.11(a)(i).
Except for any B/A Loan (the compensation for which is set forth in Section
2.22), each Loan shall bear interest from and including the date made on the
outstanding principal balance thereof as set forth in Section 2.06.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the Indebtedness to such Lender resulting from
each Loan from time to time, including the amounts of principal and interest
payable and paid such Lender from time to time under this Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type of each Loan and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from each Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder from each Borrower or any Guarantor and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) of this Section 2.04 shall, to the extent permitted by applicable laws
be prima facie evidence of the existence and amounts of the obligations therein
recorded; provided, however, that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not in
any manner affect the obligation of either Borrower to repay the Loans in
accordance with their terms.
(e) Any Lender may request from time to time that its Revolving Loans,
Tranche G Loans or Tranche H Loans be evidenced by a promissory note. In
response to any such request, the applicable Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to such Lender and its
registered assigns, substantially in the form of Exhibit I-1, in the case of a
Term Loan, and Exhibit I-2, in the case of Revolving Loans, with the blanks
appropriately filled in. Notwithstanding any other provision of this Agreement,
in the event that any Lender shall request and receive such a promissory note,
the Loans evidenced by such promissory note and interest payable on such Loans
shall at all times (including after assignment pursuant to Section 11.04) be
represented by one or more promissory notes payable to the payee named therein
and its registered assigns.
SECTION 2.05. Fees. (a) Canco agrees to pay to each Revolving Lender, in
respect of the Revolving Credit Commitments of such Lender to such Borrower,
through the Canadian Administrative Agent, on each March 31, June 30, September
30 and December 31 and on each date on which Revolving Credit Commitments of
such Lender shall expire or be terminated as provided herein, a commitment fee
(a "Commitment Fee") equal to the Applicable Rate per annum in effect for such
Revolving Credit Commitments from time to time on the daily unused amount of the
Commitments of such Lender during the preceding quarter (or other period
commencing on the Closing Date or ending with the Revolving Credit Maturity Date
or the date on which any of such Commitments of such Lender shall expire or be
terminated). The Commitment Fee due to each Lender shall commence to accrue on
and including the Closing Date and shall cease to accrue on, but excluding, the
date on which such Commitments of such Lender shall expire or be terminated as
provided herein. All Commitment Fees shall be computed on the basis of the
actual number of days elapsed in a year of 360 days.
38
33
(b) The Borrowers agree to pay to the Administrative Agent or the Canadian
Administrative Agent, for their own accounts, the administration fees at the
times and in the amounts agreed upon between the Borrowers and the
Administrative Agent and the Canadian Administrative Agent.
(c) Canco agrees to pay (i) to each Revolving Lender, through the Canadian
Administrative Agent, in U.S. Dollars on each March 31, June 30, September 30
and December 31 and on each date on which the Revolving Credit Commitment of
such Lender shall expire or be terminated as provided herein, a participation
fee (a "LC Participation Fee") calculated on such Lender's Applicable Percentage
of the daily aggregate LC Exposure (excluding the portion thereof attributable
to unreimbursed LC Disbursements) during the preceding quarter (or shorter
period commencing with the Closing Date or ending with the Revolving Credit
Maturity Date or the date on which all Letters of Credit have been canceled or
have expired and the Revolving Credit Commitments of all Lenders shall have been
terminated) at a rate equal to the greater of (x) the Applicable Rate from time
to time used to determine the interest rate on Eurodollar Revolving Credit
Borrowings pursuant to Section 2.06 minus 0.50% and (y) 1.00%, (ii) to the
Facing Agent on each March 31, June 30, September 30 and December 31 and on the
date on which the Revolving Credit Commitments shall expire or be terminated as
set forth herein, with respect to each Letter of Credit issued by it a fronting
fee as separately agreed to between the Borrowers and the Facing Agent and (iii)
to the Facing Agent with respect to the issuance, amendment or transfer of any
such Letter of Credit and each drawing made thereunder, documentary and
processing charges in accordance with the Facing Agent's standard schedule for
such charges in effect at the time of such issuance, amendment, transfer or
drawing, as the case may be. All LC Participation Fees shall be computed on the
basis of the actual number of days elapsed in a year of 360 days and shall be
payable in dollars.
(d) All Fees (other than the fees payable to the Facing Agent under
paragraph (c)(ii) or (iii) above) shall be paid on the dates due, in immediately
available funds, to the Administrative Agent or the Canadian Administrative
Agent, as applicable, for distribution, if and as appropriate, among the
Lenders. Once paid, none of the Fees shall be refundable under any circumstances
(other than corrections of errors in payment).
SECTION 2.06. Interest on Loans. (a) Subject to the provisions of Section
2.07, the Loans comprising each ABR Borrowing shall bear interest (computed on
the basis of the actual number of days elapsed over a year of 365 or 366 days,
as the case may be, when the Alternate Base Rate is determined by reference to
the Prime Rate or the U.S. Base Rate and over a year of 360 days at all other
times) at a rate per annum equal to the Alternate Base Rate plus the Applicable
Rate in effect at such time with respect to such Loans.
(b) Subject to the provisions of Section 2.07, the Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate in effect at such time with respect to such Loans.
(c) Subject to the provisions of Section 2.07, the Loans comprising each
Canadian Prime Rate Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days, as the case may
be) at a rate per annum equal to the Canadian Prime Rate plus the Applicable
Rate in effect at such time with respect to such Loans.
(d) Subject to the provisions of Section 2.07, the Loans comprising each
B/A Borrowing shall be subject to an Acceptance Fee, payable by Canco on the
date of acceptance of the relevant B/A and calculated as set forth in the
definition of the term "Acceptance Fee" in Section 1.01.
39
34
(e) Interest on each Loan (other than pursuant to a B/A Borrowing) shall be
payable on the Interest Payment Dates applicable to such Loan, except as
otherwise provided in this Agreement. The Applicable Rate for each Interest
Period or day within an Interest Period, as the case may be, shall be determined
by the Administrative Agent or the Canadian Administrative Agent, as applicable,
and such determination shall be presumptively correct absent manifest error.
(f) For the purposes of the Interest Act (Canada) and disclosure
thereunder, whenever any interest or fee to be paid hereunder or in connection
herewith is to be calculated on the basis of any period of time that is less
than a calendar year, the yearly rate of interest to which the rate used in such
calculation is equivalent is the rate so used multiplied by the actual number of
days in the calendar year in which the same is to be ascertained and divided by
360, 365 or 366, as applicable. The rates of interest under this Agreement are
nominal rates, and not effective rates or yields. The principle of deemed
reinvestment of interest does not apply to any interest calculation under this
Agreement.
SECTION 2.07. Default Interest. If either Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount becoming
due hereunder or under any Loan Document, by acceleration or otherwise, the
applicable Borrower shall on demand from time to time pay interest, to the
extent permitted by law, on such defaulted amount to but excluding the date of
actual payment (after as well as before judgment or bankruptcy) at a rate per
annum (the "Default Rate") equal to (a) in the case of any Loan, the rate that
would be applicable under Section 2.06 to such Loan plus 2.00% per annum and (b)
in the case of any other amount, the rate that would be applicable under Section
2.06 to an ABR Revolving Loan plus 2.00% per annum.
SECTION 2.08. Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing the Administrative Agent shall have
determined that dollar deposits in the principal amounts of the Loans comprising
such Borrowing are not generally available in the London inter-bank market, or
that the rates at which such dollar deposits are being offered will not
adequately and fairly reflect the cost to Lenders having outstanding Loans and
unused Commitments representing at least 20% of the aggregate outstanding Loans
and unused Commitments in respect of the affected Credit Facility of making or
maintaining their Eurodollar Loans during such Interest Period, or that
reasonable means do not exist for ascertaining the Adjusted LIBO Rate, the
Administrative Agent shall, as soon as practicable thereafter, give written or
telecopy notice of such determination to each Borrower and the Lenders. In the
event of any such determination, any request by either Borrower for a Eurodollar
Borrowing pursuant to Section 2.03 or 2.10 shall, until the Administrative Agent
shall have advised the Borrowers and the Lenders that the circumstances giving
rise to such notice no longer exist, be deemed to be a request for an ABR
Borrowing. Each determination by the Administrative Agent hereunder shall be
conclusive absent manifest error.
SECTION 2.09. Termination and Reduction of Commitments. (a) The Term Loan
Commitments shall terminate at 5:00 p.m., Standard Time, on the Closing Date.
The Revolving Credit Commitments shall terminate at 5:00 p.m., Standard Time, on
the Revolving Credit Maturity Date.
(b) Upon at least three Business Days' prior irrevocable written or
telecopy notice to the Administrative Agent, (x) Stone may at any time in whole
permanently terminate, or from time to time in part permanently reduce, the
Tranche G Commitments and (y) Canco may at any time in whole permanently
terminate, or from time to time in part permanently reduce, the Tranche H
Commitments and/or the Revolving Credit Commitments; provided, however, that (i)
each partial reduction of such Commitments shall be in an integral multiple of
U.S.$1,000,000 and in a
40
35
minimum principal amount of U.S.$5,000,000 and (ii) Canco shall not be permitted
to terminate or reduce the Revolving Credit Commitments if, as the result of
such termination or reduction, the Revolving Credit Utilization would exceed the
aggregate remaining Revolving Credit Commitments.
(c) The Revolving Credit Commitments shall be permanently reduced by the
amount of any mandatory prepayments applied to Revolving Credit Borrowings
pursuant to Section 2.13(f).
(d) Each reduction in the Commitments hereunder shall be made ratably among
the applicable Lenders in accordance with their respective applicable
Commitments.
(e) The applicable Borrower shall pay to the Administrative Agent for the
account of the applicable Lenders, on the date of each termination or reduction,
the Commitment Fees on the amount of the Commitments so terminated or reduced
accrued to, but excluding, the date of such termination or reduction.
(f) Nothing in this Section 2.09 shall prejudice any rights that either
Borrower may have against any Lender that fails to lend as required hereunder
prior to the date of termination of any Commitment.
SECTION 2.10. Conversion and Continuation of Borrowings. Each Borrower
shall have the right at any time upon prior irrevocable notice to the
Administrative Agent (i) not later than 11:00 a.m., Standard Time, on the day of
the proposed conversion, to convert any Eurodollar Borrowing into an ABR
Borrowing or to convert any B/A Borrowing to a Canadian Prime Rate Borrowing,
(ii) not later than 11:00 a.m., Standard Time, three Business Days prior to
conversion or continuation, to convert any ABR Borrowing into a Eurodollar
Borrowing or to continue any Eurodollar Borrowing as a Eurodollar Borrowing for
an additional Interest Period, (iii) not later than 11:00 a.m., Standard Time,
three Business Days prior to conversion, to convert the Interest Period with
respect to any Eurodollar Borrowing to another permissible Interest Period and
(iv) not later than 11:00 a.m., Standard Time, one Business Day prior to
conversion or continuation, to convert any Canadian Prime Rate Borrowing to a
B/A Borrowing or to continue any B/A Borrowing as a B/A Borrowing for an
additional Contract Period, subject in each case to the following:
(a) each conversion or continuation shall be made pro rata among the
Lenders in accordance with the respective principal amounts of the Loans
comprising the converted or continued Borrowing;
(b) if less than all the outstanding principal amount of any Borrowing
shall be converted or continued, then each resulting Borrowing shall
satisfy the limitations specified in Sections 2.02(a) and (b) and, if
applicable, Section 2.22, regarding the principal amount and maximum number
of Borrowings of the relevant Type;
(c) each conversion shall be effected by each Lender and the
Administrative Agent by recording the particulars thereof in their
respective records, and no new Loan shall be considered to have been made
as a result thereof; accrued interest on any Eurodollar Loan (or portion
thereof) being converted shall be paid by the applicable Borrower at the
time of the conversion;
(d) if any Eurodollar Borrowing or B/A Loan is converted at a time
other than the end of the Interest Period applicable thereto, the
applicable Borrower shall pay, upon demand, any amounts due to the Lenders
pursuant to Section 2.16;
41
36
(e) any portion of a Borrowing maturing or required to be repaid in
less than one month may not be converted into or continued as a Eurodollar
Borrowing or a B/A Borrowing;
(f) any portion of a Eurodollar Borrowing or a B/A Borrowing that
cannot be converted into or continued as a Eurodollar Borrowing or a B/A
Borrowing by reason of paragraph (e) above shall be automatically converted
at the end of the Interest Period or Contract Period in effect for such
Borrowing into an ABR Borrowing or a Canadian Prime Rate Borrowing, as the
case may be; and
(g) no Interest Period may be selected for any Eurodollar Term
Borrowing that would end later than any applicable Term Loan Repayment Date
occurring on or after the first day of such Interest Period if, after
giving effect to such selection, the aggregate outstanding amount of (i)
the Eurodollar Term Borrowings with Interest Periods ending on or prior to
such Term Loan Repayment Date and (ii) the ABR Term Borrowings would not be
at least equal to the principal amount of Term Borrowings to be paid on
such Term Loan Repayment Date.
Each notice pursuant to this Section 2.10 shall be irrevocable and shall
refer to this Agreement and specify (i) the identity, amount and Class of the
Borrowing that the Borrower requests be converted or continued, (ii) whether
such Borrowing is to be converted to or continued as a Eurodollar Borrowing, an
ABR Borrowing, a B/A Borrowing or a Canadian Prime Rate Borrowing, (iii) if such
notice requests a conversion, the date of such conversion (which shall be a
Business Day) and (iv) if such Borrowing is to be converted to or continued as a
Eurodollar Borrowing or a B/A Borrowing, the Interest Period or Contract Period,
respectively, with respect thereto. If no Interest Period or Contract Period is
specified in any such notice with respect to any conversion to or continuation
as a Eurodollar Borrowing or B/A Borrowing, respectively, the applicable
Borrower shall be deemed to have selected an Interest Period or Contract Period
of one month's or 30 days', as the case may be, duration. The Administrative
Agent shall advise the other Lenders of any notice given pursuant to this
Section 2.10 and of each Lender's portion of any converted or continued
Borrowing. If the applicable Borrower shall not have given notice in accordance
with this Section 2.10 to continue any Borrowing into a subsequent Interest
Period or Contract Period (and shall not otherwise have given notice in
accordance with this Section 2.10 to convert such Borrowing), such Borrowing
shall, at the end of the Interest Period applicable thereto (unless repaid
pursuant to the terms hereof), automatically be continued into a new Interest
Period as an ABR Borrowing or a Canadian Prime Rate Borrowing, as applicable.
SECTION 2.11. Repayment of Term Borrowings. (a)(i) Stone shall pay to the
Administrative Agent, for the account of the Tranche G Lenders, on the dates set
forth below, or if any such date is not a Business Day, on the next succeeding
Business Day (each such date being a "Tranche G Loan Repayment Date"), a
principal amount of Tranche G Loans (such amount, as adjusted from time to time
pursuant to Sections 2.12 and 2.13(f), being called the "Tranche G Loan
Repayment Amount") equal to the amount set forth below for such date, together
in each case with
42
37
accrued and unpaid interest on the principal amount to be paid to but excluding
the date of such payment:
Date Amount
---- -------
December 31, 2000 U.S.$ 2,250,000
June 30, 2001 2,250,000
December 31, 2001 2,250,000
June 30, 2002 2,250,000
December 31, 2002 2,250,000
June 30, 2003 2,250,000
December 31, 2003 2,250,000
June 30, 2004 2,250,000
December 31, 2004 2,250,000
June 30, 2005 2,250,000
December 31, 2005 2,250,000
June 30, 2006 212,625,000
December 31, 2006 212,625,000
On each Tranche G Loan Repayment Date, the Administrative Agent shall apply the
Tranche G Loan Repayment Amount paid to the Administrative Agent to pay the
Tranche G Term Loans in accordance with Section 2.19(a).
(ii) Subject to Section 2.13(j), Canco shall pay to the Canadian
Administrative Agent, for the account of the Tranche H Lenders, on the dates set
forth below, or if any such date is not a Business Day, on the next succeeding
Business Day (each such date being a "Tranche H Loan Repayment Date"), a
principal amount of Tranche H Loans (such amount, as adjusted from time to time
pursuant to Sections 2.12 and 2.13(f), being called the "Tranche H Loan
Repayment Amount") equal to the amount set forth below for such date, together
in each case with accrued and unpaid interest on the principal amount to be paid
to but excluding the date of such payment:
Date Amount
---- ------
December 31, 2000 U.S$ 2,500,000
June 30, 2001 2,500,000
December 31, 2001 2,500,000
June 30, 2002 2,500,000
December 31, 2002 2,500,000
June 30, 2003 2,500,000
December 31, 2003 2,500,000
June 30, 2004 2,500,000
December 31, 2004 2,500,000
June 30, 2005 2,500,000
December 31, 2005 2,500,000
June 30, 2006 236,250,000
December 31, 2006 236,250,000
On each Tranche H Loan Repayment Date, the Canadian Administrative Agent shall
apply the Tranche H Loan Repayment Amount paid to the Canadian Administrative
Agent to pay the Tranche H Loans in accordance with Section 2.19(a).
43
38
(b) To the extent not previously paid, all Term Loans shall be due and
payable on the Term Loan Maturity Date, together with accrued and unpaid
interest on the principal amount to be paid to but excluding the date of
payment.
(c) All repayments pursuant to this Section 2.11 shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.
SECTION 2.12. Optional Prepayments. (a) Each Borrower shall have the right
at any time and from time to time to prepay any Borrowing (other than Bankers'
Acceptances or B/A Equivalent Loans, which may, however, be defeased as provided
below), in whole or in part, upon written or telecopy notice (or telephone
notice promptly confirmed by written or telecopy notice) delivered to the
Administrative Agent or the Canadian Administrative Agent, as applicable, (i) by
11:00 a.m., Standard Time, at least three Business Days prior to the date
designated for such prepayment, in the case of any prepayment of a Eurodollar
Borrowing, or (ii) by 11:00 a.m., Standard Time, on the date designated for such
prepayment in the case of any prepayment of an ABR Borrowing or a Canadian Prime
Rate Borrowing; provided, however, that each partial payment shall be in an
amount that is an integral multiple of U.S.$1,000,000 (or Cdn.$1,000,000 in the
case of Borrowings denominated in Canadian Dollars) and, in the case of a
Eurodollar Borrowing, not less than U.S.$5,000,000 (or, in each case, the entire
amount of the Borrowing being prepaid); and provided further that Canco may
defease any B/A or B/A Equivalent Loan by depositing with the Canadian
Administrative Agent an amount that, together with interest accruing on such
amount to the end of the Contract Period for such B/A or B/A Equivalent Loan is
sufficient to pay such maturing Bankers' Acceptances or B/A Equivalent Loans
when due.
(b) Optional prepayments of Term Loans made by the Borrowers pursuant to
paragraph (a) above shall be allocated among the Term Loans (and to the
remaining scheduled installments of principal with respect to any such Term
Loans) in a manner determined at the discretion of the Borrowers.
(c) Each notice of prepayment shall specify (i) the amount to be prepaid,
(ii) the prepayment date, (iii) the Class of Loans to be repaid and (iv) the
allocation of the amount to be prepaid among the Credit Facilities and, with
respect to a prepayment of any Term Loan, the application thereof to the
scheduled installments of principal thereof. Each notice of prepayment shall be
irrevocable and shall commit the applicable Borrower to prepay such obligations
by the amount specified therein on the date specified therein. All prepayments
pursuant to this Section 2.12 shall be subject to Section 2.16, but shall
otherwise be without premium or penalty.
(d) No optional prepayment of Term Loans made by either Borrower pursuant
to this Section 2.12 shall reduce the applicable Borrower's obligation to make
mandatory prepayments pursuant to Section 2.13(b), (c) or (d).
SECTION 2.13. Mandatory Prepayments. (a) On the date of any termination or
reduction of the Revolving Credit Commitments pursuant to Section 2.09, Canco
shall pay or prepay so much of the then-outstanding Revolving Credit Borrowings
(and/or shall cash-collateralize outstanding Letters of Credit and B/A and B/A
Equivalent Loans) as shall be necessary in order that the aggregate Revolving
Credit Utilization at such time will not exceed the aggregate Revolving Credit
Commitments (after giving effect to such termination or reduction).
(b) With respect to any Asset Sale, except as expressly provided below in
this Section 2.13(b), it shall constitute an "Event of Failure" if the Borrowers
shall fail to apply not later than the third Business Day following the
determination of the amount of Net Cash Proceeds received
44
39
in respect thereof (but in no event later than 60 days (or 270 days in the event
of a casualty or condemnation) after the initial receipt by a Borrower or any
Subsidiary of such Net Cash Proceeds) an amount equal to 100% of the Net Cash
Proceeds received therefrom to prepay outstanding Loans in accordance with
Section 2.13(f); provided, however, that the Borrowers may elect, by written
notice to the Administrative Agent on or prior to the date that such failure
would become an Event of Failure, to use up to $200,000,000 in the aggregate of
such Net Cash Proceeds (other than proceeds from sale of the Collateral) to
redeem, repurchase or otherwise extinguish certain of their existing
Indebtedness pursuant to Section 7.09(a) (provided that any such redemption
takes place within 45 days of such notice). Notwithstanding the foregoing
sentence, the Borrowers shall be entitled to retain, and apply in any manner not
otherwise prohibited hereunder, up to U.S.$10,000,000, in the aggregate, of Net
Cash Proceeds received from Asset Sales following the Closing Date. In the event
that the Net Cash Proceeds from any Asset Sale involving a condemnation or
casualty exceed U.S.$100,000,000, the Borrowers shall cause such Net Cash
Proceeds to be deposited into an account under the exclusive dominion and
control of the Administrative Agent until such time that such Net Cash Proceeds
are (i) released to, or for the account of, the Borrowers or any Subsidiary in
respect of a permitted reinvestment or (ii) used to prepay outstanding Loans in
accordance with Section 2.13(f).
(c) Subject to Section 2.13(j), no later than the earlier of (i) 90 days
after the end of each fiscal year of Stone, commencing with the fiscal year
ending on December 31, 2000, and (ii) the date on which the financial statements
with respect to such period are delivered pursuant to Section 6.04(a), the
Borrowers shall prepay outstanding Loans in accordance with Section 2.13(f) in
an aggregate principal amount equal to 50% of the amount of such Excess Cash
Flow that is in excess of U.S.$100,000,000 for the fiscal year then ended.
(d) Subject to Section 2.13(j), in the event that either Borrower or any
Subsidiary shall receive Net Cash Proceeds from the issuance or other
disposition of Indebtedness for money borrowed of either Borrower or any
Subsidiary (other than Indebtedness for money borrowed permitted pursuant to
Section 7.01), the Borrowers shall substantially simultaneously with (and in any
event not later than the third Business Day next following) the receipt of such
Net Cash Proceeds by either Borrower or any Subsidiary, apply an amount equal to
100% of such Net Cash Proceeds to prepay outstanding Loans in accordance with
Section 2.13(f).
(e) If on any date, as a result of fluctuations in the Exchange Rate, the
Administrative Agent determines that the aggregate Revolving Credit Utilization
shall have exceeded for more than three consecutive Business Days an amount
equal to 105% of the total Revolving Credit Commitments, the Administrative
Agent shall notify Canco of such occurrence and Canco shall on the next
succeeding Business Day prepay Revolving Credit Loans is an amount sufficient to
eliminate such excess.
(f) Subject to Section 2.13(j) and Section 2.23, mandatory prepayments of
outstanding obligations under this Agreement made by the Borrowers pursuant to
paragraphs (b), (c) and (d) above first, shall be allocated pro rata among the
then-outstanding Term Loans and, subject to paragraph (i) below, applied pro
rata against the remaining scheduled installments of principal due in respect of
such Term Loans under Section 2.11(a) and second, if the Term Loans shall have
been repaid in full, shall be applied pro rata to permanently reduce existing
Revolving Credit Commitments; provided, however, that (i) the Borrowers may
elect, subject to the requirements of Section 2.17 and Section 2.23, to apply up
to $50,000,000 of Excess Cash Flow to the prepayment of Term Loans or the
Existing Stone Term Facilities without regard to this paragraph (f) (i.e., the
Borrowers may select the Class or Classes of Term Loans or Existing Stone Term
Facilities to receive such prepayment and the allocation of such amount to the
amortization of the Term Loans
45
40
or Existing Stone Term Facilities within such Class or Classes) and (ii) the
Borrowers may elect, subject to the requirements of Section 2.17, to apply any
mandatory prepayment of the Term Loans from Excess Cash Flow to scheduled
installments of principal required to be paid pursuant to Section 2.11(a) within
24 months of the date of such prepayment.
(g) The applicable Borrower shall deliver to the Administrative Agent, (i)
at the time of each prepayment by such Borrower required under paragraph (b),
(c) or (d) above, a certificate signed by a Financial Officer of such Borrower
setting forth in reasonable detail the calculation of the amount of such
prepayment and (ii) at least three Business Days prior to the time of each
prepayment required under this Section 2.13, a notice of such prepayment. Each
notice of prepayment shall specify the prepayment date, the Class and Type of
each Loan being prepaid and the principal amount of each Loan (or portion
thereof) to be prepaid. All prepayments of Borrowings under this Section shall
be subject to Section 2.16, but shall otherwise be without premium or penalty.
(h) To the extent possible consistent with paragraph (f) above, amounts to
be applied pursuant to this Section 2.13 to the prepayment of Loans shall be
applied first to reduce outstanding ABR Loans and, if applicable, Canadian Prime
Rate Loans. Any amounts remaining after each such application shall, at the
option of the applicable Borrower, be applied to prepay Eurodollar Loans
immediately and/or shall be deposited in the Prepayment Account (as defined
below). The Administrative Agent shall apply any cash deposited in the
Prepayment Account (i) allocable to Term Loans to prepay Eurodollar Term Loans
and (ii) allocable to Revolving Loans to prepay Eurodollar Revolving Loans, in
each case on the last day of their respective Interest Periods (or, at the
direction of the applicable Borrower, on any earlier date) until all outstanding
Term Loans or Revolving Loans, as the case may be, have been prepaid or until
all the allocable cash on deposit with respect to such Loans has been exhausted.
For purposes of this Agreement, the term "Prepayment Account" shall mean an
account established by the applicable Borrower with the Administrative Agent and
over which the Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal for application in accordance with
this paragraph (h). The Administrative Agent will, at the request of the
Borrowers, invest amounts on deposit in the Prepayment Account in Permitted
Investments that mature prior to the last day of the applicable Interest Periods
of the Eurodollar Borrowings to be prepaid; provided, however, that (i) the
Administrative Agent shall not be required to make any investment that, in its
sole judgment, would require or cause the Administrative Agent to be in, or
would result in any, violation of any law, statute, rule or regulation and (ii)
the Administrative Agent shall have no obligation to invest amounts on deposit
in the Prepayment Account if a Default or Event of Default shall have occurred
and be continuing. The Borrowers shall indemnify the Administrative Agent for
any losses relating to the investments so that the amount available to prepay
Eurodollar Borrowings on the last day of the applicable Interest Period is not
less than the amount that would have been available had no investments been made
pursuant thereto. Other than any interest earned on such investments, the
Prepayment Account shall not bear interest. Interest or profits, if any, on such
investments shall be deposited in the Prepayment Account and reinvested and
disbursed as specified above. If the maturity of the Loans has been accelerated
pursuant to Article VIII, the Administrative Agent may, in its sole discretion,
apply all amounts on deposit in the Prepayment Account to satisfy any of the
Obligations. Each Borrower hereby grants to the Administrative Agent, for its
benefit and the benefit of the Facing Agent and the Lenders, a security interest
in the Prepayment Account to secure the Obligations.
(i) Notwithstanding the requirements of paragraph (f) above and provided
that no Default or Event of Default shall have occurred and be continuing, with
respect to the amount of any mandatory prepayment required under this Agreement
that is allocated to the then-outstanding Term
46
41
Loans (such amounts, the "Prepayment Amount"), the Borrowers may, not less than
10 nor more than 20 Business Days prior to the date specified therein for such
prepayment (the "Mandatory Prepayment Date"), provide to each Lender a written
notice (each, a "Prepayment Option Notice"), which shall refer to this Section
2.13(i) and shall (i) set forth the Prepayment Amount and the portion thereof
that the applicable Lender (each, a "Prepayment Lender") will be entitled to
receive if it accepts such mandatory prepayment in accordance with this
paragraph (i), (ii) request such Prepayment Lender to notify the Borrowers and
the Administrative Agent in writing no later than the Business Day prior to the
Mandatory Prepayment Date of such Prepayment Lender's acceptance or rejection
(in each case, in whole and not in part) of its share of the Prepayment Amount
and (iii) inform such Prepayment Lender that failure by such Prepayment Lender
to accept in writing its share of the Prepayment Amount on or before the
Business Day prior to the Mandatory Prepayment Date shall be deemed a rejection
of such amount. On the Mandatory Prepayment Date, the Borrowers shall apply the
aggregate amount necessary to prepay that portion of the Prepayment Amount in
respect of which such Prepayment Lenders have accepted prepayment as described
above (such Prepayment Lenders, the "Accepting Lenders") pro rata against the
remaining installments of principal due in respect of the Term Loans of the
Accepting Lenders under Section 2.11(a). So long as no Default or Event of
Default shall have occurred and be continuing, the Borrowers shall apply any
remaining portion of the Prepayment Amount to the repayment of Indebtedness
maturing prior to the Term Loan Maturity Date. In the event that any provision
of this Section 2.13 requires prepayment of the Term Loans prior to the selected
Mandatory Prepayment Date, the Borrowers shall deposit the entire amount of the
Prepayment Amount into an account under the exclusive control and dominion of
the Administrative Agent.
(j) Notwithstanding anything to the contrary contained in this Agreement,
no prepayments are required to be made with respect to the Tranche H Loans under
Section 2.11(a)(ii) or Section 2.13(c) or (d) to the extent that such prepayment
or the obligation to make such prepayment would result in Canco under any
circumstances being obliged to pay more than 25% of the original principal
amount of the Tranche H Loans (the "Threshold Amount") prior to the fifth
anniversary of the Closing Date. The amount of such prepayments in excess of the
Threshold Amount (the "Excess Amount") will be allocated to the further
prepayment of the Tranche G Loans and allocated pro rata against the remaining
scheduled installments of principal due in respect of the Tranche G Loans under
Section 2.11(a)(i) until the Tranche G Loans have been paid in full. On the
Business Day immediately after the fifth anniversary of the Closing Date, the
Excess Amount not allocated to the further payment of the Tranche G Loans will
be paid to the Tranche H Lenders and allocated pro rata against the remaining
scheduled installments of principal due in respect of the Tranche H Loans under
Section 2.11(a)(ii).
SECTION 2.14. Reserve Requirements; Change in Circumstances; Increased
Costs. (a) Notwithstanding any other provision herein, if after the Closing Date
any change in applicable law or regulation or in the interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the force of
law) shall change the basis of taxation of payments to any Lender or the Facing
Agent of the principal of or interest on any Loan made by such Lender or any
Letter of Credit obligations, Fees or other amounts payable hereunder (other
than changes in respect of income and franchise taxes imposed on such Lender or
the Facing Agent by the jurisdiction in which such Lender or the Facing Agent is
organized or has its principal or lending office or by any political subdivision
or taxing authority thereof or therein), or shall impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of or credit extended by such Lender or the
Facing Agent (except any such reserve requirement that is reflected in the
Adjusted LIBO Rate, the Alternate Base Rate or the Canadian Prime Rate) or shall
impose on such Lender or the Facing Agent or the London or Canadian interbank
market any other condition affecting this
47
42
Agreement or Loans made by such Lender, and the result of any of the foregoing
shall be to increase the cost to such Lender of making or maintaining any Loan
or to reduce the amount of any sum received or receivable by such Lender or the
Facing Agent hereunder (whether of principal, interest or otherwise) by an
amount deemed by such Lender or the Facing Agent to be material, then the
applicable Borrower will pay to such Lender or the Facing Agent following
receipt by such Borrower of a certificate of such Lender or the Facing Agent to
such effect in accordance with Section 2.14(c) such additional amount or amounts
as will compensate such Lender or the Facing Agent on an after-tax basis for
such additional costs incurred or reduction suffered; provided, however, that no
Lender or the Facing Agent shall be entitled to demand compensation pursuant to
this paragraph (a) if it shall not be the general practice of such Lender or the
Facing Agent, as applicable, to demand such compensation in similar
circumstances under comparable provisions of other comparable credit agreements.
(b) If any Lender or the Facing Agent shall have determined that the
adoption after the Closing Date of any law, rule, regulation, agreement or
guideline regarding capital adequacy, or any change in any of the foregoing or
in the interpretation or administration of any of the foregoing by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or any
lending office of such Lender) or the Facing Agent or any Lender's or the Facing
Agent's holding company, if any, with any request or directive regarding capital
adequacy issued under any law, rule, regulation or guideline (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Lender's or the Facing Agent's capital or on the capital of such
Lender's or the Facing Agent's holding company, if any, as a consequence of this
Agreement or the Loans made by such Lender or the Letters of Credit issued by
the Facing Agent pursuant hereto to a level below that which such Lender or the
Facing Agent or such Lender's or the Facing Agent's holding company, if any,
could have achieved but for such applicability, adoption, change or compliance
(taking into consideration such Lender's or the Facing Agent's policies and the
policies of such Lender's or the Facing Agent's holding company, if any, with
respect to capital adequacy) by an amount deemed by such Lender or the Facing
Agent to be material, then from time to time the applicable Borrower shall pay
to such Lender or the Facing Agent following receipt by such Borrower of a
certificate of such Lender or the Facing Agent to such effect in accordance with
Section 2.14(c) such additional amount or amounts as will compensate such Lender
or the Facing Agent or such Lender's or the Facing Agent's holding company, if
any, on an after-tax basis for any such reduction suffered; provided, however,
that no Lender or the Facing Agent shall be entitled to demand compensation
pursuant to this paragraph (b) if it shall not be the general practice of such
Lender or the Facing Agent, as applicable, to demand such compensation in
similar circumstances under comparable provisions of other comparable credit
agreements.
(c) A certificate of each Lender or the Facing Agent setting forth such
amount or amounts as shall be necessary to compensate such Lender or the Facing
Agent or its holding company, if any, as specified in paragraph (a) or (b)
above, as the case may be, and setting forth in reasonable detail an explanation
of the basis of requesting such compensation in accordance with paragraph (a) or
(b) above, including calculations in reasonable detail, shall be delivered to
the applicable Borrower and shall be conclusive absent manifest error. The
applicable Borrower shall pay each Lender or the Facing Agent the amount shown
as due on any such certificate delivered by it within 10 days after its receipt
of the same.
(d) Failure on the part of any Lender or the Facing Agent to demand
compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of such Lender's or the Facing Agent's right to
48
43
demand compensation with respect to such period or any other period, except that
no Lender or the Facing Agent shall be entitled to compensation under this
Section 2.14 for any costs incurred or reduction suffered with respect to any
date unless such Lender or the Facing Agent, as applicable, shall have notified
the applicable Borrower that it will demand compensation for such costs or
reductions under paragraph (c) above, not more than six months after the later
of (i) such date and (ii) the date on which such Lender or the Facing Agent, as
applicable, shall have become aware of such costs or reductions. The protection
of this Section 2.14 shall be available to each Lender or the Facing Agent
regardless of any possible contention of the invalidity or inapplicability of
the law, rule, regulation, guideline or other change or condition that shall
have occurred or been imposed.
SECTION 2.15. Change in Legality. (a) Notwithstanding any other provision
herein, if after the Closing Date any change in any law or regulation or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or Revolving Loan denominated in U.S.
Dollars or to give effect to its obligations as contemplated hereby with respect
to any Eurodollar Loan or Revolving Loan denominated in U.S. Dollars, then, by
written notice to the applicable Borrower and to the Administrative Agent, such
Lender may:
(i) declare that Eurodollar Loans or Revolving Loans denominated in
U.S. Dollars will not thereafter be made by such Lender hereunder,
whereupon any request by the applicable Borrower for a Eurodollar Revolving
Credit Borrowing or a Borrowing denominated in U.S. Dollars shall, as to
such Lender only, be deemed a request for an ABR Loan or a Revolving Loan
denominated in Canadian Dollars, respectively, unless such declaration
shall be subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Loans or Revolving Loans
denominated in U.S. Dollars made by it be converted to ABR Loans or
Revolving Loans denominated in Canadian Dollars, respectively, in which
event all such Eurodollar Loans or Revolving Loans denominated in U.S.
Dollars, as the case may be, shall be automatically converted to ABR Loans
and Revolving Loans denominated in Canadian Dollars, respectively, as of
the effective date of such notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under clause (i) or (ii)
above, all payments and prepayments of principal that would otherwise have been
applied to repay the Eurodollar Loans or the Revolving Loans denominated in U.S.
Dollars that would have been made by such Lender or the converted Eurodollar
Loans or Revolving Loans denominated in U.S. Dollars of such Lender shall
instead be applied to repay the ABR Loans or Revolving Loans denominated in
Canadian Dollars made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans or Revolving Loans denominated in U.S.
Dollars, as the case may be.
(b) For purposes of this Section 2.15, a notice to the applicable Borrower
by any Lender shall be effective as to each Eurodollar Loan or Revolving Loan
denominated in U. S. Dollars if lawful, on the last day of the Interest Period
currently applicable to such Eurodollar Loan or Revolving Loan denominated in U.
S. Dollars, as the case may be; in all other cases, such notice shall be
effective on the date of receipt by such Borrower.
SECTION 2.16. Indemnity. Each Borrower shall indemnify each Lender against
any loss or expense that such Lender may sustain or incur with respect to
Eurodollar Loans as a consequence of (a) any failure by any Borrower to fulfill
on the date of any Borrowing hereunder the applicable conditions set forth in
Article V, (b) any failure by such Borrower to borrow or to refinance, convert
or continue any Loan hereunder after irrevocable notice of such borrowing,
refinancing, conversion
49
44
or continuation has been given pursuant to Section 2.03 or 2.10, (c) any
payment, prepayment or conversion of a Eurodollar Loan or B/A Loan required or
permitted by any other provision of this Agreement or otherwise, or any
assignment of a Eurodollar Loan or B/A Loan required by Section 2.21(b), in each
case made or deemed made on a date other than the last day of the Interest
Period or Contract Period, as the case may be, applicable thereto, (d) any
purchase of a participation pursuant to Article X of a Eurodollar Loan or a B/A
Loan of such Borrower otherwise made or deemed made on a date other than the
last day of the Interest Period or Contract Period therefor, or (e) any default
in payment or prepayment of the principal amount of any Loan or any part thereof
or interest accrued thereon, as and when due and payable (at the due date
thereof, whether at scheduled maturity, by acceleration, irrevocable notice of
prepayment or otherwise), including, in each such case, any loss or reasonable
expense sustained or incurred or to be sustained or incurred in liquidating or
employing deposits from third parties acquired to effect or maintain such Loan
or any part thereof as a Eurodollar Loan or B/A Loan, as the case may be. Such
loss or reasonable expense shall be equal to the sum of (a) such Lender's actual
costs and expenses incurred (other than any lost profits) in connection with, or
by reason of, any of the foregoing events and (b) an amount equal to the excess,
if any, as reasonably determined by such Lender of (i) its cost of obtaining the
funds for the Loan being paid, prepaid, converted or not borrowed, converted or
continued (assumed to be the Adjusted LIBO Rate or the Discount Rate, as
applicable, applicable thereto) for the period from and including the date of
such payment, prepayment, conversion or failure to borrow, convert or continue
to but excluding the last day of the Interest Period or Contract Period, as the
case may be for such Loan (or, in the case of a failure to borrow, convert or
continue, the Interest Period for such Loan that would have commenced on the
date of such failure) over (ii) the amount of interest (as reasonably determined
by such Lender) that would be realized by such Lender in reemploying the funds
so paid, prepaid, converted or not borrowed, converted or continued for such
period, Interest Period or Contract Period, as the case may be. A certificate of
any Lender setting forth any amount or amounts, including calculations in
reasonable detail, that such Lender is entitled to receive pursuant to this
Section 2.16 shall be delivered to the applicable Borrower and shall be
conclusive absent manifest error.
SECTION 2.17. Pro Rata Treatment. Except as required under Section 2.15 or
permitted under Section 2.13(h), each Borrowing, each payment or prepayment of
principal of any Borrowing, each payment of interest on the Loans, each payment
of the Commitment Fees, each payment of the LC Participation Fees, each
reduction of the Commitments and each refinancing of any Borrowing with,
conversion of any Borrowing to or continuation of any Borrowing as a Borrowing
of any Type shall be allocated pro rata among the Lenders in accordance with
their respective applicable Commitments (provided that in the event that such
Commitments shall have expired or been terminated, such pro rata allocation
shall be based on the respective principal amounts of the outstanding Loans).
Each Lender agrees that in computing such Lender's portion of any Borrowing to
be made hereunder, the Administrative Agent may, in its discretion, round each
Lender's percentage of such Borrowing, computed in accordance with Section 2.01,
to the next higher or lower whole U.S. Dollar or Canadian Dollar amount, as
applicable. In addition, each Lender agrees that the Administrative Agent may,
in its sole discretion, increase or reduce any Revolving Lender's portion of a
B/A Loan to the extent provided in Section 2.22(e).
SECTION 2.18. Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
any Loan Party, or pursuant to a secured claim under any applicable Insolvency
Law or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable Insolvency Law or otherwise,
or by any other means, obtain payment (voluntary or involuntary) in respect of
any Loan or Loans or LC Exposure as a result of which the unpaid principal
portion of its Loans or its LC Exposure shall be proportionately less than the
unpaid principal portion of the Loans of any other Lender or any
50
45
other Lender's LC Exposure, such Lender shall be deemed simultaneously to have
purchased from such other Lender at face value, and shall promptly pay to such
other Lender the purchase price for, a participation in the Loans of such other
Lender or the LC Exposure of such other Lender, so that the aggregate unpaid
principal amount of the Loans, LC Exposure and participation in Loans and LC
Exposure held by each Lender shall be in the same proportion to the aggregate
unpaid principal amount of all Loans and LC Exposure then outstanding as the
principal amount of such Lender's Loans and LC Exposure prior to such exercise
of banker's lien, setoff or counterclaim or other event was to the principal
amount of all Loans and LC Exposure outstanding prior to such exercise of
banker's lien, setoff or counterclaim or other event; provided, however, that if
any such purchase or purchases or adjustments shall be made pursuant to this
Section 2.18 and the payment giving rise thereto shall thereafter be recovered,
such purchase or purchases or adjustments shall be rescinded to the extent of
such recovery and the purchase price or prices or adjustment restored without
interest. Each Borrower expressly consents to the foregoing arrangements and
agrees that any Lender holding a participation in a Loan or LC Exposure deemed
to have been so purchased may exercise any and all rights of banker's lien,
setoff or counterclaim with respect to any and all moneys owing by the Loan
Parties to such Lender by reason thereof as fully as if such Lender had made a
Loan directly to the applicable Borrower in the amount of such participation.
SECTION 2.19. Payments. (a) Each Borrower shall make each payment
(including principal of or interest on any Loan or any Fees or other amounts)
hereunder and under any other Loan Document not later than 12:00 noon, Standard
Time, on the date when due in immediately available U.S. Dollars or Canadian
Dollars, as applicable, without defense, setoff or counterclaim. Each such
payment (other than (i) the payments specified in Sections 2.05(c)(ii) and (iii)
and paragraph (d) of Article III, which shall be paid directly to the Facing
Agent) shall be made to such account of the Administrative Agent or the Canadian
Administrative Agent, as applicable, as such Agent shall specify by notice to
the applicable Borrower. Payments made directly to the Facing Agent shall be
made to such account of the Facing Agent as the Facing Agent shall specify by
notice to Canco. Any payments received by the Administrative Agent, the Canadian
Administrative Agent or the Facing Agent after the specified time for receipt of
such payment on any day shall be deemed to have been received on the next
Business Day. The Administrative Agent or the Canadian Administrative Agent, as
applicable, shall distribute to the applicable Lenders all payments received by
it for their respective accounts, promptly following receipt thereof.
(b) Whenever any payment (including principal of or interest on any
Borrowing or any Fees or other amounts) hereunder or under any other Loan
Document shall become due, or otherwise would occur, on a day that is not a
Business Day, such payment may be made on the next succeeding Business Day, and
such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
SECTION 2.20. Taxes. (a) Any and all payments by the Loan Parties hereunder
shall be made, in accordance with Section 2.19, free and clear of and without
deduction for any and all current or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding
taxes imposed on the net income of the Administrative Agent or the Facing Agent
or any Lender (or any transferee or assignee thereof, including a participation
holder (any such entity being called a "Transferee")), and franchise taxes
imposed on the Administrative Agent or the Facing Agent or any Lender (or
Transferee), by the United States, Canada or any jurisdiction under the laws of
which the Administrative Agent or the Facing Agent or any such Lender (or
Transferee) is organized or in which the Administrative Agent or the Facing
Agent or any such Lender (or Transferee) has its principal office or lending
office or any political subdivision or taxing authority thereof or therein (all
such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If any Taxes are
51
46
required to be deducted from or in respect of any sum payable hereunder to any
Lender (or any Transferee), the Administrative Agent or the Facing Agent, (i)
the sum payable shall be increased by the amount necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section 2.20) such Lender (or Transferee), the Administrative
Agent or the Facing Agent (as the case may be) shall receive an amount equal to
the sum it would have received had no such deductions been made, (ii) the
Borrowers shall make such deductions and (iii) the Borrowers shall pay the full
amount deducted to the relevant taxing authority or other Governmental Authority
in accordance with applicable law; provided, however, that no Transferee of any
Lender shall be entitled to receive any greater payment under this paragraph (a)
than such Lender would have been entitled to receive with respect to the rights
assigned, participated or otherwise transferred unless (x) such assignment,
participation or transfer shall have been made at a time when the circumstances
(including a Change of Law) giving rise to such greater payment did not exist or
had not yet occurred, (y) such assignment, participation or transfer shall have
been at the request of the Borrowers or (z) such assignment, participation or
transfer shall have been made pursuant to Section 2.18 or Article X.
(b) Each Borrower agrees to pay any current or future stamp, intangible or
documentary taxes or any other excise or property taxes, charges or similar
levies (including, without limitation, mortgage recording taxes and similar
fees) that arise from any payment made hereunder or from the execution, delivery
or registration of, or otherwise with respect to, this Agreement, any Assignment
and Acceptance entered into at the request of either Borrower or any other Loan
Document (hereinafter referred to as "Other Taxes").
(c) Each Borrower will indemnify each Lender (or Transferee), the
Administrative Agent and the Facing Agent for the full amount of Taxes and Other
Taxes (including any Taxes or Other Taxes on amounts payable under this Section
2.20) paid by such Lender (or Transferee), the Administrative Agent or the
Facing Agent, as the case may be, and any liability (including penalties,
interest and reasonable expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted by
the relevant taxing authority or other Governmental Authority. Such
indemnification shall be made within 30 days after the date any Lender (or
Transferee), the Administrative Agent or the Facing Agent, as the case may be,
makes written demand therefor (which demand shall identify the nature and amount
of Taxes and Other Taxes for which indemnification is being sought and shall
include a copy of the relevant portion of any written assessment from the
relevant taxing authority demanding payment of such Taxes or Other Taxes, unless
the Lender (or Transferee), the Administrative Agent or the Facing Agent, as the
case may be, determines, in its sole discretion, that such portion of any such
assessment is confidential). If a Lender (or Transferee), the Administrative
Agent or the Facing Agent shall become aware that it is entitled to receive a
refund in respect of Taxes or Other Taxes as to which it has been indemnified by
the applicable Borrower pursuant to this Section 2.20, it shall promptly notify
such Borrower of the availability of such refund and shall, within 30 days after
receipt of a request by the applicable Borrower, apply for such refund at such
Borrower's expense. If any Lender (or Transferee), the Administrative Agent or
the Facing Agent receives a refund in respect of any Taxes or Other Taxes as to
which it has been indemnified by either Borrower pursuant to this Section 2.20,
it shall promptly notify such Borrower of such refund and shall, within 30 days
of receipt, repay such refund (to the extent of amounts that have been paid by
such Borrower under this Section 2.20 with respect to such refund and not
previously reimbursed) to such Borrower, net of all reasonable out-of-pocket
expenses of such Lender, the Administrative Agent or the Facing Agent and
without interest (other than the interest, if any, included in such refund net
of any Taxes payable with respect to receipt of such refund), provided that such
Borrower, upon the request of such Lender (or Transferee), the Administrative
Agent or the Facing Agent, agrees to return such refund (plus penalties,
interest or other charges) to such Lender (or Transferee), the Administrative
Agent
52
47
or the Facing Agent in the event such Lender (or Transferee), the Administrative
Agent or the Facing Agent is required to repay such refund.
(d) Within 30 days after the date of any payment of Taxes or Other Taxes
withheld by either Borrower in respect of any payment to any Lender (or
Transferee), the Administrative Agent or the Facing Agent, such Borrower will
furnish to the Administrative Agent, at the addresses referred to in Section
11.01, the original or a certified copy of a receipt evidencing payment thereof
or other evidence reasonably satisfactory to such Lender (or Transferee), the
Administrative Agent or the Facing Agent, as the case may be.
(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section 2.20 shall
survive the payment in full of the principal of and interest on all Loans made
hereunder.
(f) Each of the Administrative Agent, the Facing Agent and any Tranche G
Lender (or Transferee thereof) that is not incorporated or otherwise formed
under the laws of the United States of America or a state thereof (a "Non-U.S.
Person") agrees that it shall on the date it becomes a Lender (or Transferee),
the Administrative Agent or the Facing Agent hereunder, deliver to Stone and the
Administrative Agent (x) one duly completed copy of United States Internal
Revenue Service Form 1001 or 4224 (or replacement or successor forms thereto),
or (y) in the case of Tranche G Lenders (or Transferees thereof) exempt from
United States Federal withholding tax pursuant to Sections 871(h) or 881(c) of
the Code, one duly completed copy of a United States Internal Revenue Service
Form W-8 (or successor form) (including Form W-8BEN (Certificate of Foreign
Status of Beneficial Owner for United States Tax Withholding) and Form W-8ECI
(Certificate of Foreign Person's Claim for Exemption From Withholding or Income
Effectively Connected with the Conduct of a Trade or Business in the United
States)) and a certificate representing that such Non-U.S. Person is not a bank
for purposes of Section 881(c) of the Code, or any successor applicable form of
any thereof, certifying in each case that such Tranche G Lender (or Transferee
thereof), the Administrative Agent or the Facing Agent is entitled to receive
payments hereunder payable to it without deduction or withholding of any United
States Federal income taxes, or subject to a reduced rate thereof. Each of the
Administrative Agent or the Facing Agent or any Tranche G Lender (or Transferee
thereof) that delivers to Stone and the Administrative Agent any such form or
certification further undertakes to deliver to Stone and the Administrative
Agent further copies of any such form or certification or other manner of
certification reasonably satisfactory to Stone on or before the date that any
such form or certification expires or becomes obsolete or of the occurrence of
any event requiring a change in the most recent forms or certifications
previously delivered by it to Stone or the Administrative Agent, and such
extensions or renewals thereof as may reasonably be requested by Stone or the
Administrative Agent, certifying that the Administrative Agent, Facing Agent or
such Tranche G Lender (or Transferee thereof), as the case may be, is entitled
to receive payments hereunder without deduction or withholding of any United
States Federal income taxes, or subject to a reduced rate thereof. If at any
time there has occurred, on or prior to the date on which any delivery of any
such form or certification would otherwise be required, any change in law, rule,
regulation, treaty, convention or directive, or any change in the interpretation
or application of any thereof ("Change of Law"), that renders all such forms or
certification inapplicable or which would prevent the Administrative Agent,
Facing Agent or such Tranche G Lender (or Transferee thereof), as the case may
be, from duly completing and delivering any such form or certification with
respect to it, the Administrative Agent, Facing Agent or such Tranche G Lender
(or Transferee thereof), as the case may be, shall advise Stone that under
applicable law it shall be subject to withholding of United States Federal
income tax at the full statutory rate, a reduced rate of withholding or without
deduction or withholding. A Non-U.S. Person shall be required to furnish any
such form or certification only if it is entitled to claim an
53
48
exemption from, or a reduced rate of, withholding. Each of the Administrative
Agent, the Facing Agent and any Tranche G Lender that is a Non-U.S. Person and
that is a party hereto as of the Closing Date hereby represents and warrants
that, as of the Closing Date, all payments made to it hereunder are exempt from
withholding of United States Federal income taxes (x) because such payments are
effectively connected with a United States trade or business conducted by such
Non-U.S. Person; (y) pursuant to the terms of an income tax treaty between the
United States and such Non-U.S. Person's country of residence; or (z) because
such payments are portfolio interest exempt pursuant to Section 871(h) or 881(c)
of the Code. Notwithstanding any provision of paragraph (a) above to the
contrary, Stone shall not have any obligation to pay any Taxes or Other Taxes or
to indemnify any Tranche G Lender (or Transferee thereof), the Administrative
Agent or the Facing Agent for such Taxes or Other Taxes pursuant to this Section
2.20 to the extent that such Taxes or Other Taxes result from (x) the failure of
any Tranche G Lender (or Transferee thereof), the Administrative Agent or the
Facing Agent to comply with its obligations pursuant to this paragraph (f) or
(y) any representation made on any such form or certification (or successor
applicable form or certification) by the Tranche G Lender (or Transferee
thereof), the Administrative Agent or the Facing Agent incurring such Taxes or
Other Taxes proving to have been incorrect, false or misleading in any material
respect when so made or deemed to be made. Nothing contained herein shall
require the Administrative Agent, the Facing Agent or any Tranche G Lender (or
Transferee thereof) to make its tax returns (or any other information relating
to its taxes which it deems confidential) available to Stone or any other
person.
(g) Each of the Administrative Agent, the Facing Agent, and any Tranche H
Lender (or Transferee thereof) that is entitled to an exemption from or
reduction of withholding tax under the laws of Canada, or any treaty to which
Canada is a party, with respect to payment in connection with the Tranche H
Loans under this Agreement shall, upon request by the Administrative Agent,
deliver to Canco (with a copy to the Administrative Agent), such properly
completed and executed documentation prescribed by applicable law or reasonably
requested by Canco as will permit such payments to be made without withholding
or at a reduced rate. Notwithstanding any provision of paragraph (a) above to
the contrary, Canco shall have no obligation to pay any Taxes or Other Taxes or
to indemnify any Tranche H Lender or Revolving Lender (or Transferee thereof),
the Administrative Agent or the Facing Agent for such Taxes or Other Taxes
pursuant to this Section 2.20 to the extent that such Taxes or Other Taxes
result from (x) the failure of any Tranche H Lender or Revolving Lender, the
Administrative Agent or the Facing Agent to comply with its obligations pursuant
to this paragraph (g) (provided, however, that no Tranche H Lender shall be
required to provide any documentation that it is not legally able to provide) or
(y) any representation made in any such documentation by the Tranche H Lender,
Revolving Lender, the Administrative Agent or the Facing Agent incurring such
Taxes or Other Taxes proving to have been incorrect, false or misleading in any
material respect when so made or deemed to be made. Nothing contained herein
shall require the Administrative Agent, the Facing Agent or any Tranche H Lender
or Revolving Lender (or Transferee thereof) to make its tax returns (or any
other information relating to its taxes which it deems confidential) available
to Canco or any other Person.
SECTION 2.21. Duty to Mitigate; Assignment of Commitments under Certain
Circumstances. (a) Any of the Administrative Agent, the Facing Agent or any
Lender (or Transferee) claiming any additional amounts payable pursuant to
Section 2.14 or Section 2.20 or exercising its rights under Section 2.15 shall
use reasonable efforts (consistent with legal and regulatory restrictions) to
file any certificate or document requested by either Borrower or to change the
jurisdiction of its applicable lending office if the making of such filing or
change would avoid the need for or reduce the amount of any such additional
amounts that may thereafter accrue or avoid the circumstances giving rise to
such exercise and would not, in the sole determination of such Lender (or
Transferee), the Administrative Agent or the Facing Agent, as the case may be,
require
54
49
it to incur additional costs or be otherwise disadvantageous to such Lender (or
Transferee), the Administrative Agent or the Facing Agent.
(b) In the event that any Lender shall have delivered a notice or
certificate pursuant to Section 2.14 or 2.15, or either Borrower shall be
required to make additional payments to any Lender under Section 2.20, the
applicable Borrower shall have the right, but not the obligation, at its own
expense (including with respect to the processing and recordation fee referred
to in Section 11.04(b)), upon notice to such Lender and the Administrative
Agent, to replace such Lender with an assignee (in accordance with and subject
to the restrictions contained in Section 11.04(b)) approved by the
Administrative Agent (which approval shall not be unreasonably withheld), and
such Lender hereby agrees to transfer and assign without recourse (in accordance
with and subject to the restrictions contained in Section 11.04(b)) all its
interests, rights and obligations under this Agreement to such assignee;
provided, however, that no Lender shall be obligated to make any such assignment
unless (i) such assignment shall not conflict with any law or any rule,
regulation or order of any Governmental Authority, (ii) such assignee shall pay
to the affected Lender in immediately available funds on the date of such
assignment the principal of the Loans made by such Lender hereunder and (iii)
the applicable Borrower shall pay to the affected Lender in immediately
available funds on the date of such assignment the interest accrued to the date
of payment on the Loans made by such Lender hereunder and all other amounts
accrued for such Lender's account or owed to it hereunder.
(c) If, in connection with any proposed amendment, modification, change,
waiver, discharge or termination to any of the provisions of this Agreement as
contemplated by Section 11.08(b), the consent of the Required Lenders is
obtained but the consent of one or more of such other Lenders whose consent is
required is not obtained, then the Borrower shall have the right, but not the
obligation, at its own expense (including with respect to the processing and
recordation fee referred to in Section 11.04(b)) upon notice to such Lender and
the Administrative Agent, so long as all non-consenting Lenders whose individual
consent is required are treated as described below, to replace each such
non-consenting Lender or Lenders (or, at the option of the Borrower if the
respective Lender's consent is required with respect to less than all Loans, to
replace only the respective Loans of the respective non-consenting Lender which
gave rise to the need to obtain such Lender's individual consent) with an
assignee (in accordance with and subject to the restrictions contained in
Section 11.04(b)) approved by the Administrative Agent (which approval shall not
be unreasonably withheld) so long as at the time of such replacement, each such
assignee consents to the proposed amendment, modification, change, waiver,
discharge or termination; provided, however, that no Lender shall be obligated
to make any such assignment unless (i) such assignment shall not conflict with
any law or any rule, regulation or order of any Governmental Authority, (ii)
such assignee shall pay to the non-consenting Lender in immediately available
funds on the date of such assignment the principal of the Loans made by such
Lender hereunder and subject to such assignment and (iii) the Borrower shall pay
to the non-consenting Lender in immediately available funds on the date of such
assignment the interest accrued to the date of payment on the Loans made by such
Lender hereunder and subject to such assignment and all other amounts accrued
for such Lender's account or owed to it hereunder with respect to such Loans.
SECTION 2.22. Bankers' Acceptances. (a) Subject to the terms and conditions
of this Agreement, Canco may request a Revolving Credit Borrowing denominated in
Canadian Dollars by presenting drafts for acceptance and, if applicable,
purchase as B/A's by the Revolving Lenders.
(b) No Contract Period with respect to a B/A to be accepted and, if
applicable, purchased as a Revolving Loan shall extend beyond the Revolving
Credit Maturity Date. All B/A's and B/A Loans shall be denominated in Canadian
Dollars.
55
50
(c) To facilitate availment of B/A Loans, Canco hereby appoints each
Revolving Lender as its attorney to sign and endorse on its behalf (in
accordance with a notice of Borrowing relating to a B/A Loan pursuant to Section
2.03 or Section 2.10), in handwriting or by facsimile or mechanical signature as
and when deemed necessary by such Revolving Lender, blank forms of B/A's in the
form requested by such Revolving Lender. In this respect, it is each Revolving
Lender's responsibility to maintain an adequate supply of blank forms of B/A's
for acceptance under this Agreement. Canco recognizes and agrees that all B/A's
signed and/or endorsed by a Revolving Lender on behalf of Canco shall bind Canco
as fully and effectually as if signed in the handwriting of and duly issued by
the proper signing officers of Canco. Each Revolving Lender is hereby authorized
(in accordance with a notice of Borrowing relating to a B/A Loan) to issue such
B/A's endorsed in blank in such face amounts as may be determined by such
Revolving Lender; provided that the aggregate amount thereof is equal to the
aggregate amount of B/A's required to be accepted and purchased by such
Revolving Lender. No Revolving Lender shall be liable for any damage, loss or
other claim arising by reason of any loss or improper use of any such instrument
except for the gross negligence or wilful misconduct of the Revolving Lender or
its officers, employees, agents or representatives. Each Revolving Lender shall
maintain a record, which shall be made available to Canco upon its request, with
respect to B/A's (i) received by it in blank hereunder, (ii) voided by it for
any reason, (iii) accepted and purchased by it hereunder, and (iv) canceled at
their respective maturities. On request by or on behalf of Canco, a Revolving
Lender shall cancel all forms of B/A's which have been pre-signed or
pre-endorsed on behalf of Canco and that are held by such Revolving Lender and
are not required to be issued in accordance with Canco's irrevocable notice.
Alternatively, Canco agrees that, at the request of the Canadian Administrative
Agent, Canco shall deliver to the Canadian Administrative Agent a "depository
note" which complies with the requirements of the Depository Bills and Notes Act
(Canada), and consents to the deposit of any such depository note in the
book-based debt clearance system maintained by the Canadian Depository for
Securities.
(d) Drafts of Canco to be accepted as B/A's hereunder shall be signed as
set forth in this Section 2.22. Notwithstanding that any Person whose signature
appears on any B/A may no longer be an authorized signatory for any Lender or
Canco at the date of issuance of a B/A, such signature shall nevertheless be
valid and sufficient for all purposes as if such authority had remained in force
at the time of such issuance and any such B/A so signed shall be binding on
Canco.
(e) Promptly following the receipt of a notice of borrowing specifying a
Revolving Credit Borrowing by way of B/A's, the Canadian Administrative Agent
shall so advise the Revolving Lenders and shall advise each Revolving Lender of
the aggregate face amount of the B/A's to be accepted by it and the applicable
Contract Period (which shall be identical for all Revolving Lenders). In the
case of Revolving Loans comprised of B/A Loans, the aggregate face amount of the
B/A's to be accepted by a Revolving Lender shall be in a minimum aggregate
amount of Cdn.$100,000 and shall be a whole multiple of Cdn.$100,000, and such
face amount shall be in the Revolving Lenders' PRO RATA portions of such
Revolving Borrowing, provided that the Administrative Agent may in its sole
discretion increase or reduce any Revolving Lender's portion of such B/A Loan to
the nearest Cdn.$100,000 without reducing the aggregate Revolving Credit
Commitments.
(f) Canco may specify in a notice of borrowing pursuant to Section 2.03 or
Section 2.10 that it desires that any B/A's requested by such notice of
borrowing be purchased by the Revolving Lenders, in which case the Revolving
Lenders shall, upon acceptance of a B/A by a Revolving Lender, purchase, or
arrange for the purchase of, each B/A from Canco at the Discount Rate for such
Revolving Lender applicable to such B/A accepted by it and provide to the
Canadian Administrative Agent the Discount Proceeds for the account of Canco.
The Acceptance Fee payable
56
51
by Canco to a Revolving Lender under Section 2.06(d) in respect of each B/A
accepted by such Revolving Lender shall be set off against the Discount Proceeds
payable by such Revolving Lender under this Section 2.22.
(g) Each Revolving Lender may at any time and from time to time hold, sell,
rediscount or otherwise dispose of any or all B/A's accepted and purchased by
it.
(h) If a Revolving Lender is not a chartered bank under the Bank Act
(Canada) or if a Revolving Lender notifies the Canadian Administrative Agent in
writing that it is otherwise unable to accept Bankers' Acceptances, such
Revolving Lender will, instead of accepting and, if applicable, purchasing
Bankers' Acceptances, make an advance (a "B/A Equivalent Loan") to Canco in the
amount and for the same term as the draft that such Revolving Lender would
otherwise have been required to accept and purchase hereunder. Each such
Revolving Lender will provide to the Canadian Administrative Agent the Discount
Proceeds of such B/A Equivalent Loan for the account of Canco. Each such B/A
Equivalent Loan will bear interest at the same rate that would result if such
Lender had accepted (and been paid an Acceptance Fee) and purchased (on a
discounted basis at the Discount Rate) a Bankers' Acceptance for the relevant
Contract Period (it being the intention of the parties that each such B/A
Equivalent Loan shall have the same economic consequences for the Lenders and
Canco as the Bankers' Acceptance which such B/A Equivalent Loan replaces). All
such interest shall be paid in advance on the date such B/A Equivalent Loan is
made, and will be deducted from the principal amount of such B/A Equivalent Loan
in the same manner in which the Discount Proceeds of a Bankers' Acceptance would
be deducted from the face amount of the Bankers' Acceptance.
(i) Canco waives presentment for payment and any other defense to payment
of any amounts due to a Revolving Lender in respect of a B/A accepted and
purchased by it pursuant to this Agreement which might exist solely by reason of
such B/A being held, at the maturity thereof, by such Revolving Lender in its
own right, and Canco agrees not to claim any days of grace if such Revolving
Lender, as holder, sues Canco on the B/A for payment of the amount payable by
Canco thereunder. On the last day of the Contract Period of a B/A, or such
earlier date as may be required or permitted pursuant to the provisions of this
Agreement, Canco shall pay the Revolving Lender that has accepted and purchased
such B/A the full face amount of such B/A and, after such payment, Canco shall
have no further liability in respect of such B/A and such Revolving Lender shall
be entitled to all benefits of, and be responsible for all payments due to third
parties under, such B/A.
(j) Except as required by any Revolving Lender upon the occurrence of an
Event of Default, no B/A Loan may be repaid by Canco prior to the expiry date of
the Contract Period applicable to such B/A Loan; provided, however, that any B/A
Loan may be defeased as provided in the proviso to Section 2.12(a).
SECTION 2.23. Pro rata Treatment of Loans and Existing Stone Credit
Agreement. Notwithstanding any other provision herein, any funds to be used to
prepay Loans or reduce Revolving Credit Commitments pursuant to Section 2.13(b),
(c) or (d) shall be allocated pro rata between (a) the Term Loans and Revolving
Credit Commitments, on the one hand, and (b) the loans under the Existing Stone
Credit Agreement and commitments in respect thereof, on the other hand, based
upon the aggregate outstanding amount of (i) the Loans, LC Exposure and unused
Commitments, on the one hand, and (ii) the loans, letter of credit exposure and
unused commitments under the Existing Stone Credit Agreement, on the other hand,
on the date of prepayment; provided, however, that (i) any Asset Sale of
Collateral or Existing Stone Collateral shall not be subject to such pro rata
allocation and (ii) any such allocation shall be subject to the proviso
contained in
57
52
Section 2.13(f). The pro rata amount allocated to Loans in accordance with this
Section 2.23 shall be applied as otherwise required by this Agreement.
ARTICLE III
Letters of Credit
Subject to the terms and conditions set forth herein, Canco may request the
issuance of Letters of Credit denominated in U.S. Dollars or Canadian Dollars
for its own account, in a form reasonably acceptable to the Administrative Agent
and the Facing Agent, at any time and from time to time prior to the date that
is 30 days before the Revolving Credit Maturity Date. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by Canco to, or entered into by Canco with, the Facing Agent relating
to any Letter of Credit, the terms and conditions of this Agreement shall
control. Each Letter of Credit is subject to the following terms and conditions:
(a) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
To request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), Canco shall hand deliver or
telecopy (or transmit by electronic communication, if arrangements for doing so
have been approved by the Facing Agent) to the Facing Agent, the Administrative
Agent and the Canadian Administrative Agent (reasonably in advance of the
requested date of issuance, amendment, renewal or extension) a notice requesting
the issuance of a Letter of Credit, or identifying the Letter of Credit to be
amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (b) of this
Article III), the amount and currency of such Letter of Credit, the name and
address of the beneficiary thereof and such other information as shall be
necessary to prepare, amend, renew or extend such Letter of Credit. If requested
by the Facing Agent, Canco also shall submit a letter of credit application on
the Facing Agent's standard form in connection with any request for a Letter of
Credit. A Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Letter of Credit
Canco shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension (i) the LC Exposure shall not
exceed U.S.$50,000,000 and (ii) the Revolving Credit Utilization shall not
exceed the aggregate Revolving Credit Commitments.
(b) Expiration Date. Each Letter of Credit shall expire at or prior to the
close of business on the earliest of (i) the date one year after the date of the
issuance of such Letter of Credit (or, in the case of any renewal or extension
thereof, one year after such renewal or extension) and (ii) the date that is 30
days prior to the Revolving Maturity Date.
(c) Participations. By the issuance of a Letter of Credit (or an amendment
to a Letter of Credit increasing the amount thereof) and without any further
action on the part of the Facing Agent or the Lenders, the Facing Agent hereby
grants to each Revolving Lender, and each Revolving Lender hereby acquires from
the Facing Agent, a participation in such Letter of Credit equal to such
Lender's Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to
pay to the Canadian Administrative Agent, for the account of the Facing Agent,
such Lender's Applicable Percentage of each LC Disbursement made by the Facing
Agent and not reimbursed by Canco on the date due as provided in paragraph (d)
of this Article III, or of any reimbursement payment required to be refunded to
Canco for any reason. Each
58
53
Lender acknowledges and agrees that its obligation to acquire participations
pursuant to this paragraph (c) in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including any amendment, renewal or extension of any Letter of Credit or the
occurrence and continuance of a Default or reduction or termination of the
Revolving Credit Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(d) Reimbursement. If the Facing Agent shall pay any drawing presented
under a Letter of Credit, Canco shall pay to the Facing Agent an amount equal to
the amount of such drawing not later than two hours after Canco shall have
received notice from the Facing Agent that payment of such drawing will be made
or, if Canco shall have received such notice later than 10:00 a.m., Standard
Time, on any Business Day, not later than 10:00 a.m., Standard Time on the
immediately following Business Day, provided that Canco may, subject to the
conditions to borrowing set forth herein, request in accordance with Section
2.03 that such payment be financed with an ABR Revolving Borrowing or, if such
LC Disbursement is denominated in Canadian Dollars, a Canadian Prime Rate
Borrowing (or failing such request, such LC Disbursement may be financed as an
ABR Revolving Borrowing or a Canadian Prime Rate Borrowing, as the case may be,
pursuant to Section 2.02(e)) in an equivalent amount and, to the extent so
financed, Canco's obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing or Canadian Prime Rate
Borrowing, as the case may be. If Canco fails to make such payment when due, the
Facing Agent shall notify the Canadian Administrative Agent, which shall in turn
notify each Revolving Lender of the applicable LC Disbursement, the payment then
due from Canco in respect thereof and such Lender's Applicable Percentage
thereof. Promptly following receipt of such notice, each Revolving Lender shall
pay to the Canadian Administrative Agent its Applicable Percentage of the
payment then due from Canco, in the same manner as provided in Section 2.02(c)
with respect to Loans made by such Lender, and the Canadian Administrative Agent
shall promptly pay to the Facing Agent the amounts so received by it from the
Revolving Lenders. Promptly following receipt by the Canadian Administrative
Agent of any payment from Canco pursuant to this paragraph (d), the Canadian
Administrative Agent shall distribute such payment to the Facing Agent or, to
the extent that Revolving Lenders have made payments pursuant to this paragraph
(d) to reimburse the Facing Agent, then to such Lenders and the Facing Agent as
their interests may appear. Any payment made by a Revolving Lender pursuant to
this paragraph (d) to reimburse the Facing Agent for any LC Disbursement (other
than the funding of ABR Revolving Loans or Canadian Prime Rate Loan as
contemplated above) shall not constitute a Loan and shall not relieve Canco of
its obligation to reimburse such LC Disbursement.
(e) Obligations Absolute. Canco's obligation to repay the Facing Agent for
LC Disbursements made by the Facing Agent under the outstanding Letters of
Credit for the account of Canco shall be absolute, unconditional and irrevocable
under any and all circumstances and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, setoff, defense or other right that
Canco or any other Person may at any time have against the beneficiary or
any transferee under any Letter of Credit, the Facing Agent, the
Administrative Agent, any Lender or any other Person (other than the
defense of payment in accordance with the terms of this Agreement or a
defense based on the gross negligence or wilful misconduct of the Facing
Agent) in connection with this Agreement or any other agreement or
transaction;
59
54
(iii) any draft or other document presented under a Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or
any statement therein being untrue or inaccurate in any respect, provided
that payment by the Facing Agent under such Letter of Credit against
presentation of such draft or document shall not have constituted gross
negligence or wilful misconduct of the Facing Agent;
(iv) payment by the Facing Agent under a Letter of Credit against
presentation of a draft or other document that does not comply with the
terms of such Letter of Credit, provided that such payment shall not have
constituted gross negligence or wilful misconduct of the Facing Agent; and
(v) any other circumstance or event whatsoever, whether or not similar
to any of the foregoing, provided that such circumstance or event shall not
have been the result of gross negligence or wilful misconduct of the Facing
Agent.
It is understood that in making any payment under a Letter of Credit (i)
the Facing Agent's exclusive reliance on the documents presented to it under
such Letter of Credit as to any and all matters set forth therein, including
reliance on the amount of any draft presented under such Letter of Credit,
whether or not the amount due to the beneficiary equals the amount of such draft
and whether or not any document presented pursuant to such Letter of Credit
proves to be insufficient in any respect, if such document on its face appears
to be in order, and whether or not any other statement or any other document
presented pursuant to such Letter of Credit proves to be forged or invalid or
any statement therein proves to be inaccurate or untrue in any respect
whatsoever, and (ii) any noncompliance in any immaterial respect of the
documents presented under a Letter of Credit with the terms thereof shall, in
each case, not be deemed wilful misconduct or gross negligence of the Facing
Agent.
(f) Disbursement Procedures. The Facing Agent shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Facing Agent shall promptly notify the
Canadian Administrative Agent and Canco by telephone (confirmed by telecopy) of
such demand for payment and whether the Facing Agent has made or will make a LC
Disbursement thereunder, provided that any failure to give or delay in giving
such notice shall not relieve Canco of its obligation to reimburse the Facing
Agent and the Revolving Lenders with respect to any such LC Disbursement.
(g) Interim Interest. If the Facing Agent shall make any LC Disbursement,
then, unless Canco shall reimburse such LC Disbursement in full on the date such
LC Disbursement is made, the unpaid amount thereof shall bear interest, for each
day from and including the date such LC Disbursement is made to but excluding
the date that Canco reimburses such LC Disbursement, at the rate per annum then
applicable to ABR Revolving Loans or, if such LC Disbursement is denominated in
Canadian Dollars, Canadian Prime Rate Loans, provided that, if Canco fails to
reimburse such LC Disbursement when due pursuant to paragraph (d) of this
Article III, then Section 2.07 shall apply. Interest accrued pursuant to this
paragraph (g) shall be for the account of the Facing Agent, except that interest
accrued on and after the date of payment by any Revolving Lender pursuant to
paragraph (d) of this Article III to reimburse the Facing Agent shall be for the
account of such Lender to the extent of such payment.
(h) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that Canco receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Revolving Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
60
55
pursuant to this paragraph (h), Canco shall deposit in an account with the
Canadian Administrative Agent, in the name of the Canadian Administrative Agent
and for the benefit of the Lenders, an amount in cash equal to the LC Exposure
as of such date plus any accrued and unpaid fees and interest thereon, provided
that the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without
demand or other notice of any kind, upon the occurrence of any Event of Default
with respect to Canco described in paragraph (g) or (h) of Article VIII. Each
such deposit shall be held by the Canadian Administrative Agent as collateral
for the payment and performance of the obligations of Canco under this
Agreement. The Canadian Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over such account. Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Canadian Administrative
Agent and at Canco's risk and expense, such deposits shall not bear interest.
Interest or profits, if any, on such investments shall accumulate in such
account. Moneys in such account shall be applied by the Canadian Administrative
Agent to reimburse the Facing Agent for LC Disbursements for which it has not
been reimbursed and, to the extent not so applied, shall be held for the
satisfaction of the reimbursement obligations of Canco for the LC Exposure at
such time or, if the maturity of the Loans has been accelerated (but subject to
the consent of Revolving Lenders with LC Exposure representing greater than 50%
of the total LC Exposure), be applied to satisfy other obligations of Canco
under this Agreement. If Canco is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to Canco
within three Business Days after all Events of Default have been cured or
waived.
(i) Replacement of the Facing Agent. The Facing Agent may be replaced at
any time by written agreement among Canco, each Agent, the Administrative Agent,
the replaced Facing Agent and the successor Facing Agent. Any such successor
Facing Agent shall be resident in Canada for purposes of the ITA. The
Administrative Agent shall notify the Lenders of any such replacement of the
Facing Agent. At the time any such replacement shall become effective, Canco
shall pay all unpaid fees accrued for the account of the replaced Facing Agent
pursuant to Section 2.05(c). From and after the effective date of any such
replacement, (i) the successor Facing Agent shall have all the rights and
obligations of the Facing Agent under this Agreement with respect to Letters of
Credit to be issued thereafter and (ii) references herein to the term "Facing
Agent" shall be deemed to refer to such successor or to any previous Facing
Agent, or to such successor and all previous Facing Agents, as the context shall
require. After the replacement of a Facing Agent hereunder, the replaced Facing
Agent shall remain a party hereto and shall continue to have all the rights and
obligations of a Facing Agent under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.
(j) Additional Facing Agents. Canco may, at any time and from time to time
with the consent of the Agents (which consent shall not be unreasonably
withheld) and such Lender, designate one or more additional Revolving Lenders to
act as a Facing Agent under the terms of this Agreement. Any Revolving Lender
designated as a Facing Agent pursuant to this paragraph (j) of Article III shall
be deemed to be the "Facing Agent" (in addition to being a Lender) in respect of
Letters of Credit issued or to be issued by such Lender, and, with respect to
such Letters of Credit, such term shall thereafter apply to the Facing Agent and
such Lender.
(k) Notification by Facing Agents. On the first Business Day of each week,
each Facing Agent shall report to the Administrative Agent and the Canadian
Administrative Agent the aggregate face amount of Letters of Credit issued by it
and outstanding as of the last Business Day of the preceding week. The Canadian
Administrative Agent shall promptly notify the Revolving Lenders, in writing, of
the issuance of or any amendment to a Standby Letter of Credit, and if any
Revolving
61
56
Lender so requests, the Canadian Administrative Agent shall provide such
Revolving Lender with copies of any such issuance or amendment.
ARTICLE IV
Representations and Warranties
Each of Stone and Canco represents and warrants to each of the Lenders, the
Agents, the Administrative Agent and the Facing Agent that:
SECTION 4.01. Organization; Powers. Each of the Loan Parties (a) is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization, (b) has all requisite power and
authority to own its property and assets and to carry on its business as now
conducted, (c) is qualified to do business in every jurisdiction where such
qualification is required by the nature of its business, the character and
location of its property, business or customers, or the ownership or leasing of
its properties, except for such jurisdictions in which the failure so to
qualify, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect, and (d) has the corporate power and authority to
execute, deliver and perform its obligations under each of the Loan Documents
and each other agreement or instrument contemplated thereby to which it is or
will be a party and, in the case of the Borrowers, to borrow hereunder.
SECTION 4.02. Authorization. The execution, delivery and performance by
each of the Loan Parties of each of the Loan Documents to which it is a party,
the Borrowings hereunder, the issuance of the Letters of Credit, the use of the
proceeds of the Loans and the Letters of Credit, the creation of the security
interests contemplated by the Security Documents, the consummation of the
Acquisition and the other transactions contemplated by the Loan Documents and
the SLP Acquisition Documents (all the foregoing, collectively, the
"Transactions") (a) have been duly authorized by all requisite corporate and, if
required, stockholder action and (b) will not (i) violate (A) any provision of
law, statute, rule or regulation, other than any law, statute, rule or
regulation the violation of which could not reasonably be expected to result in
a Material Adverse Effect, or of the certificate of incorporation or other
constitutive documents or by-laws of any Loan Party or any of their respective
Subsidiaries, (B) any order of any Governmental Authority, the violation of
which, solely with respect to the consummation of the Acquisition and the
transactions contemplated by the SLP Acquisition Documents, could not reasonably
be expected to result in a Material Adverse Effect, or (C) any provision of any
indenture or other material agreement or other material instrument to which any
Loan Party or any of their respective Subsidiaries is a party or by which any of
them or any of their property is or may be bound, the violation of which, solely
with respect to the consummation of the Acquisition and the transactions
contemplated by the SLP Acquisition Documents, could not reasonably be expected
to result in a Material Adverse Effect, (ii) constitute (alone or with notice or
lapse of time or both) a default under any such indenture, agreement or other
instrument where such default, solely with respect to the consummation of the
Acquisition and the transactions contemplated by the SLP Acquisition Documents,
could reasonably be expected to result in a Material Adverse Effect, or (iii)
result in the creation or imposition of any Lien (other than any Lien created
hereunder or under the Security Documents) upon or with respect to any property
or assets now owned or hereafter acquired by any Loan Party or any of their
respective Subsidiaries.
SECTION 4.03. Enforceability. This Agreement has been duly executed and
delivered by each Borrower and constitutes, and each other Loan Document when
executed and delivered by each
62
57
Loan Party thereto will constitute, a legal, valid and binding obligation of
each Borrower and the Loan Parties, as applicable, enforceable against each of
them in accordance with its terms (a) except as the enforceability thereof may
be limited by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and (b) subject to general principles of equity.
SECTION 4.04. Governmental Approvals. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Transactions, except for (a) the
filing of Uniform Commercial Code financing statements, and similar security or
collateral filings and registrations under applicable laws in other
jurisdictions, (b) recordation of the Mortgages and ship mortgages on any
vessels, (c) filings with the United States Patent and Trademark Office, the
United States Copyright Office, the Canadian Intellectual Property Office and
the Ministry of Natural Resources under the Forest Act (Quebec) (in respect of
the Canco Hypothec only) and (d) such actions, consents, approvals,
registrations and filings as have been made or obtained and are in full force
and effect or the failure of which to make or obtain, solely with respect to the
consummation of the Acquisition and the transactions contemplated by the SLP
Acquisition Documents, could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 4.05. Financial Statements. (a) Stone has delivered to the Lenders
(i) its audited financial statements and the audited financial statements of
Canco for the fiscal year ended December 31, 1999, together with its annual
report on Form 10-K and Canco's annual report on Form 20-F filed with the
Securities and Exchange Commission with respect to such fiscal year, and (ii)
its unaudited financial statements and the unaudited financial statements of
Canco for the fiscal quarter ended March 31, 2000, together with its quarterly
report on Form 10-Q filed with the Securities and Exchange Commission with
respect to such fiscal quarter. All financial statements set forth or referred
to in the materials specified in the preceding sentence were prepared in
conformity with U.S. GAAP or Canadian GAAP, as applicable, except with respect
to unaudited financial statements for the absence of footnote disclosure and for
year-end audit adjustments. All such financial statements fairly present in all
material respects the consolidated financial position of Stone and its
subsidiaries or Canco and its subsidiaries, as the case may be, as at the date
thereof and the consolidated results of operations and changes in financial
position of Stone and its subsidiaries or Canco and its subsidiaries, as the
case may be, for each of the periods covered thereby. Except as disclosed in
such financial statements, neither Stone nor Canco nor any of their respective
subsidiaries had, at the date of such financial statements or on the Closing
Date, as the case may be, any material contingent obligation, material
contingent liability or material liability for taxes, long-term lease or unusual
forward or long-term commitment or obligations to retired employees for medical
or other employee benefits that is not reflected in the foregoing financial
statements or the notes thereto.
(b) Stone has delivered to the Lenders its unaudited pro forma consolidated
balance sheet and statements of income as of December 31, 1999, prepared giving
effect to the Transactions as if they had occurred, with respect to such balance
sheet, on such date and, with respect to such other financial statements, on the
first day of the 12-month period ending on such date. Such pro forma financial
statements have been prepared in good faith by Stone, based on the assumptions
used to prepare the pro forma financial information contained in the
Confidential Information Memorandum (which assumptions are believed by Stone on
the Closing Date to be reasonable), present fairly on a pro forma basis the
estimated consolidated financial position of Stone and its consolidated
Subsidiaries as of such date and for such period, assuming that the Transactions
had actually occurred at such date or at the beginning of such period, as the
case may be.
63
58
SECTION 4.06. No Material Adverse Change. There has been no material
adverse change in the business, assets, operations, properties, prospects or
condition (financial or otherwise) of Stone and its consolidated Subsidiaries,
taken as a whole, since December 31, 1999.
SECTION 4.07. Title to Properties; Possession Under Leases. (a) Except as
set forth on Schedule 4.07, each Borrower and the Subsidiaries have good and
marketable title to, or valid leasehold interests in, all their respective
material properties and assets, except for minor defects in title that do not
interfere in any material respect with its ability to conduct its business as
currently conducted. All such title to, or leasehold interest in, material
properties and assets are free and clear of Liens, other than Liens expressly
permitted by Section 7.02 and Liens with respect to which BTCo, as Collateral
Agent, has received on or prior to the Closing Date duly executed releases and
termination statements in connection therewith.
(b) Each Borrower and the Subsidiaries have complied with all obligations
under all material leases to which it is a party and enjoys peaceful and
undisturbed possession under all such material leases necessary in any material
respect for the operation of their respective properties and assets.
SECTION 4.08. Subsidiaries. Schedule 4.08 sets forth as of the Closing Date
a list of all the Subsidiaries of each Borrower, their jurisdiction of
organization and the percentage ownership interest of each of them and any other
Subsidiary therein. The capital stock of each of the Subsidiaries is duly
authorized, validly issued, fully paid and nonassessable and, except as set
forth on Schedule 4.08, is owned free and clear of all Liens other than
nonconsensual Permitted Liens arising other than as a result of a voluntary act
of the Borrowers. No authorized but unissued treasury shares of capital stock of
either Borrower or any such Subsidiary are subject to any option, warrant, right
to call or commitment of any kind or character except as set forth on Schedule
4.08.
SECTION 4.09. Litigation; Compliance with Laws. (a) Except as set forth in
Schedule 4.09, there are not any actions, suits or proceedings at law or in
equity or by or before any Governmental Authority now pending or, to the
knowledge of either Borrower, threatened against or affecting either Borrower or
any of the Subsidiaries or any business or property of any such Person that (i)
involve any Loan Document or the Transactions or (ii) could reasonably be
expected to, individually or in the aggregate, result in a Material Adverse
Effect.
(b) Neither Borrower nor any of the Subsidiaries nor any of their
respective properties or assets is (i) in violation of, nor will the continued
operation of their properties and assets as currently conducted violate, any
law, rule, regulation, statute (including any zoning, building, environmental
and safety law; ordinance, code or approval or any building permits) or any
restrictions of record or agreements affecting the Mortgaged Properties, where
such violations could reasonably be expected to have a Material Adverse Effect
or (ii) in default with respect to any judgment, writ, injunction, decree or
order of any Governmental Authority, where such defaults, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
SECTION 4.10. Agreements. Neither Borrower nor any of the Subsidiaries is
in default under any provision of any indenture or other agreement or instrument
evidencing Indebtedness, or any other agreement or instrument to which it is a
party or by which it or any of its properties or assets are or may be bound,
where such default could reasonably be expected to result in a Material Adverse
Effect.
64
59
SECTION 4.11. Federal Reserve Regulations. (a) Neither Borrower nor any of
the Subsidiaries is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of purchasing or carrying
Margin Stock.
(b) No part of the proceeds of any Letter of Credit or Loan has been used,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, (i) to purchase or carry Margin Stock or to extend credit to others
for the purpose of purchasing or carrying Margin Stock or to refund indebtedness
originally incurred for such purpose or (ii) for any purpose that entails a
violation of, or is inconsistent with, the provisions of the Regulations of the
Board, including Regulation T, U or X.
SECTION 4.12. Investment Company Act; Public Utility Holding Company Act.
Neither Borrower nor any of the Subsidiaries (a) is an "investment company" as
defined in, or is subject to regulation under, the Investment Company Act of
1940 or (b) is a "holding company" as defined in, or is subject to regulation
under, the Public Utility Holding Company Act of 1935.
SECTION 4.13. Tax Returns. Each of the Borrowers and the Subsidiaries has
filed or caused to be filed all Federal, foreign, state and local income and
other material tax returns required to have been filed by it or with respect to
it and has paid or caused to be paid all taxes shown to be due and payable on
such returns or on any assessments received by it or with respect to it, except
taxes that are being contested in good faith by appropriate proceedings and for
which it has set aside on its books adequate reserves in accordance with U.S. or
Canadian GAAP, as applicable.
SECTION 4.14. No Material Misstatements. The information provided by or on
behalf of the Borrowers and contained in the Confidential Information Memorandum
(including all attachments and exhibits thereto), as supplemented, and as
supplemented further by information heretofore provided in writing by or on
behalf of the Borrowers to the Lenders and any other materials, documents and
information that the Borrowers or any of their Affiliates may have furnished to
the Lenders, was as of the date of such Confidential Information Memorandum, the
dates otherwise specified therein or the dates upon which such information was
provided, when taken as a whole, accurate in all material respects and does not
contain any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, when taken as a whole, not materially misleading,
provided that to the extent any such information therein was based upon or
constitutes a forecast or projection, each Borrower represents only that it
acted in good faith and utilized reasonable assumptions, due and careful
consideration and the information actually known to Responsible Officers of each
Borrower at the time in the preparation of such information.
SECTION 4.15. Employee Benefit Plans. (a) Each Borrower and their
respective ERISA Affiliates is in compliance in all material respects with the
applicable provisions of ERISA and the Code and the regulations and published
interpretations thereunder. No Reportable Event has occurred in respect of any
Plan of either Borrower or any ERISA Affiliate. The present value of all
actuarial accrued liabilities under each Plan (based on those assumptions used
to fund such Plan) did not, as of the last annual valuation date applicable
thereto, exceed by more than U.S.$25,000,000 the value of the assets of such
Plan, and the present value of all actuarial accrued liabilities of all
underfunded Plans (based on those assumptions used to fund each such Plan) did
not, as of the last annual valuation dates applicable thereto, exceed by more
than U.S.$25,000,000 the value of the assets of all such underfunded Plans.
Neither Borrower nor any ERISA Affiliate has incurred any Withdrawal Liability
that could result in a Material Adverse Effect. Neither Borrower nor any ERISA
Affiliate has received any notification that any Multiemployer Plan is in
reorganization or has been terminated within the meaning of Title IV of ERISA
and no Multiemployer Plan is
65
60
reasonably expected to be in reorganization or to be terminated where such
reorganization or termination has resulted or could reasonably be expected to
result, through increases in the contributions required to be made to such Plan
or otherwise, in a Material Adverse Effect.
(b) The Canadian Pension Plans are duly registered under the ITA and any
other applicable laws which require registration, have been administered in all
material respects in accordance with the ITA and such other applicable laws and
no event has occurred which could reasonably be expected to cause the loss of
such registered status. All material obligations of Canco and each of its
Subsidiaries required to be performed by Canco or its Subsidiaries in connection
with the Canadian Pension Plans and the funding agreements therefor have been
performed on a timely basis. As of the Closing Date, there are no outstanding
disputes concerning the assets of the Canadian Pension Plans or the Canadian
Benefit Plans. No promises of benefit improvements under the Canadian Pension
Plans or the Canadian Benefit Plans have been made except where such improvement
could not reasonably be expected to have a Material Adverse Effect. All
contributions or premiums required to be made or paid by Canco and each of its
Subsidiaries to the Canadian Pension Plans or the Canadian Benefit Plans have
been made on a timely basis in accordance with the terms of such plans and all
applicable laws. There have been no improper withdrawals or applications of the
assets of the Canadian Pension Plans or the Canadian Benefit Plans. None of the
Canadian Pension Plans or the Canadian Benefit Plans has any unfunded actuarial
liabilities or solvency deficiencies (within the meaning of the Quebec
Supplemental Pension Plans Act) in an aggregate amount in excess of
U.S.$25,000,000.
SECTION 4.16. Environmental and Safety Matters. Except as set forth on
Schedule 4.16,
(a) Each Borrower and each of the Subsidiaries has obtained all
permits, licenses and other authorizations that are required and material
with respect to the operation of the business of each Borrower and the
Subsidiaries, taken as a whole, under any Environmental Law, and each such
permit, license and authorization is in full force and effect.
(b) Each Borrower and each of the Subsidiaries is in compliance with
all material terms and conditions of the permits, licenses and
authorizations specified in Section 4.16(a), and are also in compliance
with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained
in any Environmental Law applicable to it and its business, assets,
operations and properties, including those arising under the Resource
Conservation and Recovery Act of 1976, as amended, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
("CERCLA"), the Federal Water Pollution Control Act, the Federal Clean Air
Act, and the Toxic Substances Control Act and any analogous or comparable
Canadian, state or provincial laws and regulations, except for such
instances of noncompliance that could not reasonably be expected to result
in a Material Adverse Effect.
(c) There is no civil, criminal or administrative action, suit,
demand, claim, hearing, notice of violation, investigation, proceeding,
notice or demand letter or request for information pending or, to the
knowledge of either Borrower or any of the Subsidiaries, after inquiry,
threatened against either Borrower or any of the Subsidiaries under any
Environmental Law that could reasonably be expected to result in a Material
Adverse Effect.
(d) Neither Borrower nor any of the Subsidiaries has received notice
that it has been identified as a potentially responsible party under CERCLA
or any comparable state law, nor has either Borrower or any of the
Subsidiaries received any notification that any hazardous substances or any
pollutant or contaminant, as defined in CERCLA and its
66
61
implementing regulations, or any toxic substance, hazardous waste,
hazardous constituents, hazardous materials, asbestos or asbestos
containing material, polychlorinated biphenyls, petroleum, including crude
oil and any fractions thereof, or other wastes, chemicals, substances or
materials regulated by any Environmental Laws (collectively, "Hazardous
Materials") that it or any of their respective predecessors in interest has
used, generated, stored, tested, handled, transported or disposed of, has
been found at any site at which any Governmental Authority or private party
is conducting a remedial investigation or other action pursuant to any
Environmental Law, except in each case for any such notices that,
individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.
(e) There have been no releases or threatened releases (in each case
as defined in CERCLA) of Hazardous Materials by either Borrower or any of
the Subsidiaries on, upon, into or from any of the Real Properties, which
releases or threatened releases could reasonably be expected to result in a
Material Adverse Effect. To the best knowledge of each Borrower and each of
the Subsidiaries, there have been no such releases or threatened releases
on, upon, under or into any real property in the vicinity of any of the
Real Properties that, through soil, surface water or groundwater migration
or contamination, may be located on, in or under such Real Properties and
which could reasonably be expected to result in a Material Adverse Effect.
(f) To the best knowledge of each Borrower and each of the
Subsidiaries, there is no asbestos in, on, or at any Real Properties or any
facility or equipment of either Borrower or any of the Subsidiaries except
to the extent that the presence of such material could not reasonably be
expected to result in a Material Adverse Effect.
(g) None of the Mortgaged Properties and, to the best knowledge of
each Borrower and each of the Subsidiaries after due inquiry, none of the
other Real Properties of either Borrower or any of the Subsidiaries are (i)
listed or proposed for listing on the National Priorities List under CERCLA
or (ii) listed in the Comprehensive Environmental Response, Compensation,
Liability Information System List promulgated pursuant to CERCLA, or on any
comparable list maintained by any Governmental Authority.
(h) There are no past or current events, conditions, circumstances,
activities, practices, incidents, actions or plans that could reasonably be
anticipated to interfere with or prevent compliance with any Environmental
Law, or which may give rise to liability under any Environmental Law, or
otherwise form the basis of any claim, action, demand, suit, proceeding,
hearing or notice of violation, study or investigation, based on or related
to the manufacture, processing, distribution, use, generation, treatment,
storage, disposal, transport, shipping or handling, or the emission,
discharge, release or threatened release into the environment, of any
Hazardous Material that could reasonably be expected to result in a
Material Adverse Effect.
SECTION 4.17. Solvency. After giving effect to the Transactions to occur on
the Closing Date, (a) the fair salable value of the assets of Stone and the
Subsidiaries, on a consolidated basis, will exceed the amount that will be
required to be paid on or in respect of the existing debts and other liabilities
(including contingent liabilities) of Stone and the Subsidiaries, on a
consolidated basis, as they mature, (b) the assets of Stone and the
Subsidiaries, on a consolidated basis, will not constitute unreasonably small
capital to carry out their businesses as conducted or as proposed to be
conducted, including the capital needs of Stone and its Subsidiaries, on a
consolidated basis (taking into account the particular capital requirements of
the businesses conducted by such entities
67
62
and the projected capital requirements and capital availability of such
businesses) and (c) neither Borrower intends to, nor does it intend to permit
any of the Subsidiaries to, and does not believe that it or any such Subsidiary
will, incur debts beyond its ability to pay such debts as they mature (taking
into account the timing and amounts of cash to be received by each of them or
any such Subsidiary and the amounts to be payable on or in respect of its
obligations).
SECTION 4.18. Security Documents. (a) (i) The U.S. Pledge Agreement creates
in favor of BTCo, as Collateral Agent, for the ratable benefit of the
beneficiaries named therein, a legal, valid and enforceable security interest in
the Collateral (as defined in the U.S. Pledge Agreement) and proceeds thereof
and, when the portion of the Collateral constituting certificated securities (as
defined in the Uniform Commercial Code as in effect in the State of New York) is
delivered to the Collateral Agent, the U.S. Pledge Agreement will constitute a
fully perfected first priority Lien on, and security interest in, all right,
title and interest of the Loan Parties party thereto, in such Collateral and the
proceeds thereof, in each case prior and superior in right to any other Person.
(ii) The Canadian Pledge Agreement and Hypothec create in favor of BTCo, as
Collateral Agent, and the Trustee, respectively, for the ratable benefit of the
beneficiaries named therein, a legal, valid and enforceable security interest or
hypothec in the portion of the Collateral described therein and proceeds thereof
and constitute, when the proper filings, recordings and registrations specified
on Schedule 4.18(a)(ii) are made, a fully perfected or published first-priority
or first-ranking Lien on, and security interest or hypothec in, all right, title
and interest in such Collateral and the proceeds thereof, in each case prior and
superior in right to any other Person other than with respect to Permitted
Liens. When each Hypothec is filed in the Canadian Intellectual Property Office,
the hypothec created thereunder shall constitute a fully perfected Lien on, and
hypothec in, all right, title and interest of the Loan Parties in the registered
intellectual property charged under each Hypothec and in which a hypothec may be
perfected by filing, recording or registering a security agreement, financing
statement or analogous document in the Canadian Intellectual Property Office,
prior and superior in right to any other Person other than with respect to the
rights of Persons pursuant to Permitted Liens (it being understood that
subsequent recordings in the Canadian Intellectual Property Office may be
necessary to perfect a Lien on registered trademarks, trademark applications and
copyrights acquired by the Loan Parties after date hereof).
(b) (i) The U.S. Security Agreement creates in favor of BTCo, as Collateral
Agent, for the ratable benefit of the beneficiaries named therein, a legal,
valid and enforceable security interest in the Collateral (as defined in the
U.S. Security Agreement) (other than vessels) and proceeds thereof, and, when
financing statements in appropriate form are filed in the offices specified on
Schedule 10 to the Perfection Certificate (as defined in the U.S. Security
Agreement), the U.S. Security Agreement shall constitute a fully perfected Lien
on, and security interest in, all right, title and interest of the grantors
thereunder in such Collateral, other than the Intellectual Property (as defined
in the U.S. Security Agreement), to the extent perfection can be obtained by
filing Uniform Commercial Code financing statements, prior and superior in right
to any other Person other than with respect to Permitted Liens. When the U.S.
Security Agreement is filed in the United States Patent and Trademark Office and
the United States Copyright Office, the security interest created thereunder
shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Loan Parties in the registered Intellectual Property
in which a security interest may be perfected by filing, recording or
registering a security agreement, financing statement or analogous document in
the United States Patent and Trademark Office or the United States Copyright
Office, as applicable, in each case prior and superior in right to any other
Person, other than with respect to the rights of Persons pursuant to Permitted
Liens (it being understood that subsequent recordings in the United States
Patent and Trademark Office and the United States
68
63
Copyright Office may be necessary to perfect a lien on registered trademarks,
trademark applications and copyrights acquired by the Loan Parties after the
date hereof).
(ii) The Canadian Security Agreement creates in favor of BTCo, as
Collateral Agent, for the ratable benefit of the beneficiaries named therein, a
legal, valid and enforceable security interest in the Collateral (as defined in
the Canadian Security Agreement) and proceeds thereof, and when financing
statements in appropriate form have been filed in the offices specified on
Schedule 4.18(b), the Canadian Security Agreement will constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral in which a Lien may be perfected by the
filing of financing statements and the proceeds thereof, in each case prior and
superior in right to any other Person other than with respect to Permitted
Liens. When the Canadian Security Agreement is filed in the Canadian
Intellectual Property Office, the security interest created thereunder shall
constitute a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in the registered Intellectual Property (as
defined in the Canadian Security Agreement) in which a security interest may be
perfected by filing, recording or registering a security agreement, financing
statement or analogous document in the Canadian Intellectual Property Office,
prior and superior in right to any other Person other than with respect to the
rights of Persons pursuant to Permitted Liens (it being understood that
subsequent recordings in the Canadian Intellectual Property Office may be
necessary to perfect a lien on registered trademarks, trademark applications and
copyrights acquired by the Loan Parties after date hereof).
(c) The Mortgages create in favor of BTCo, as Collateral Agent, for the
ratable benefit of the beneficiaries named therein, a legal, valid and
enforceable Lien on each Loan Party's right, title and interest in and to the
Mortgaged Properties thereunder and the proceeds thereof, and when the Mortgages
are properly filed and recorded in the offices specified on Schedule 4.18(c),
the Mortgages will constitute a fully perfected Lien on, and security interest
in, all right, title and interest of each Loan Party in such Mortgaged
Properties and the proceeds thereof, in each case prior and superior in right to
any other Person other than Permitted Liens.
SECTION 4.19. Labor Matters. As of the Closing Date, there are no strikes,
lockouts or slowdowns against either Borrower or any of the Subsidiaries pending
or, to the knowledge of either Borrower, threatened, except as set forth on
Schedule 4.19. The hours worked by and payment made to employees of the
Borrowers have not been in violation of the Fair Labor Standards Act or any
other applicable Federal, state, local or foreign law dealing with such matters,
where such violations could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect. The consummation of the
Transactions will not give rise to a right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which either Borrower or any of the Subsidiaries is a party or by which
either Borrower or any of the Subsidiaries is bound on the Closing Date.
SECTION 4.20. Location of Real Property. (a) Schedule 4.20 sets forth
completely and correctly as of the Closing Date all material real property owned
by each Borrower or any of the Subsidiaries in the United States and, solely
with respect to Canco and its Subsidiaries, Canada, and the addresses thereof.
All the real property set forth on Schedule 4.20 is owned in fee by a Borrower
or a Subsidiary or, where such real property is located in the Province of
Quebec, such real property is owned under the tenure of free and common SOCCAGE
or under the tenure of FRANC ALLEU ROTURIER by a Borrower or a Subsidiary.
(b) Schedule 4.20 sets forth completely and correctly as of the Closing
Date all material real property leased by the Borrowers or any of the
Subsidiaries in the United States and, solely with
69
64
respect to Canco and its Subsidiaries, Canada, and the addresses thereof. A
Borrower or one of the Subsidiaries has a valid lease in all the leased Real
Property set forth on Schedule 4.20.
SECTION 4.21. Patents, Trademarks, Etc. Each Borrower and each of the
Subsidiaries owns, or is licensed to use, all patents, trademarks, trade names,
copyrights, technology, know-how and processes, service marks and rights with
respect to the foregoing that are (a) used in or necessary for the conduct of
their respective businesses as currently conducted and (b) material to the
business, assets, operations, properties, prospects or condition (financial or
otherwise) of the Borrowers and the Subsidiaries taken as a whole. The use of
such patents, trademarks, trade names, copyrights, technology, know-how,
processes and rights with respect to the foregoing by the Borrowers and the
Subsidiaries does not infringe on the rights of any Person, subject to such
claims and infringements as do not, in the aggregate, give rise to any liability
on the part of either Borrower and the Subsidiaries that is material to the
Borrowers and the Subsidiaries, taken as a whole. To the best knowledge of each
Borrower, its rights and the rights of the Subsidiaries to sell, franchise or
license under such brand names then being used may be transferred in connection
with any sale of assets or stock of the related business by the Borrowers or any
of the Subsidiaries with only such exceptions as would not be material to the
Borrowers and the Subsidiaries, in each case, taken as a whole.
SECTION 4.22. Survival of Warranties. All representations and warranties
contained in this Agreement and the other Loan Documents shall survive the
effectiveness of this Agreement and such other Loan Documents as the case may
be, and the termination hereof and thereof.
ARTICLE V
Conditions
The obligation of each Lender to make Loans hereunder and the obligation of
the Facing Agent to issue, amend, extend or renew any Letter of Credit hereunder
(each, a "Credit Event") is subject to the satisfaction of the following
conditions:
SECTION 5.01. All Credit Events. On the date of each Credit Event:
(a) The Administrative Agent and, where applicable, the Facing Agent
shall have received a notice of such Credit Event as required by Section
2.03 and paragraph (a) of Article III, respectively.
(b) The representations and warranties set forth in Article IV hereof
and in the other Loan Documents shall be true and correct in all material
respects on and as of the date of such Credit Event with the same effect as
though made on and as of such date, except to the extent that such
representations and warranties expressly relate to an earlier date (it
being understood that on the Closing Date such representations and
warranties shall be true and correct in all material respects both before
and after giving effect to the Acquisition and the other Transactions to
occur on the Closing Date).
(c) At the time of and immediately after such Credit Event, no Default
or Event of Default shall have occurred and be continuing.
70
65
Each Credit Event shall be deemed to constitute a representation and warranty by
the Borrowers on the date of such Credit Event, as to the matters specified in
paragraphs (b) and (c) of this Section 5.01.
SECTION 5.02. First Credit Event. On the Closing Date:
(a) The Administrative Agent shall have received, on behalf of itself,
the Lenders and the Facing Agent, a favorable customary written opinion of
(i) Winston & Xxxxxx, U.S. counsel for the Borrowers, substantially to the
effect set forth in Exhibit G-1, (ii) Stikeman Elliott, Ontario counsel for
the Borrowers, substantially to the effect set forth in Exhibit G-2-A,
(iii) Stikeman Elliott, Quebec counsel for the Borrowers, substantially to
the effect set forth in Exhibit G-2-B, (iv) Stikeman Elliott, Canadian tax
counsel for the Borrowers, substantially to the effect set forth in Exhibit
G-2-C and (v) each local counsel set forth on Schedule 5.02(a),
substantially to the effect set forth in Exhibit G-3, in each case (A)
dated the Closing Date, (B) addressed to the Facing Agent, the Agents and
the Lenders, and (C) covering such other matters relating to the Loan
Documents as the Agents shall reasonably request and with such other
changes as are reasonably acceptable to the Agents, and the Borrowers
hereby instruct their counsel to deliver such opinions.
(b) All legal matters incident to this Agreement, the Borrowings and
extensions of credit hereunder and the other Loan Documents shall be
reasonably satisfactory to the Agents, the Lenders and the Facing Agent.
(c) The Administrative Agent shall have received each of the items
referred to in clauses (A), (B) and (C) below with respect to each Loan
Party: (A) a copy of the certificate or articles of incorporation,
including all amendments thereto, of each Loan Party, certified as of a
recent date by the Secretary of State or other relevant Governmental
Authority of the jurisdiction of its organization, and a certificate as to
the good standing of each Loan Party as of a recent date from such
Secretary of State or other Governmental Authority; (B) a certificate of
the Secretary or Assistant Secretary of each Loan Party dated the Closing
Date and certifying (w) that attached thereto is a true and complete copy
of the by-laws of such Loan Party as in effect on the Closing Date, (x)
that attached thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of such Loan Party authorizing the
Transactions, and that such resolutions have not been modified, rescinded
or amended and are in full force and effect, (y) that the certificate or
articles of incorporation of such Loan Party have not been amended since
the date of the last amendment thereto shown on the certificate of good
standing furnished pursuant to clause (A) above, and (z) as to the
incumbency and specimen signature of each officer executing any Loan
Document on behalf of such Loan Party; (C) a certificate of another officer
as to the incumbency and specimen signature of the Secretary or Assistant
Secretary executing the certificate pursuant to (B) above; and such other
documents as the Agents may reasonably request.
(d) The Administrative Agent shall have received a certificate of
Stone, dated the Closing Date and signed by a Financial Officer of and on
behalf of Stone, confirming compliance with the conditions precedent set
forth in paragraphs (b) and (c) of Section 5.01.
(e) The Administrative Agent shall have received all Fees and other
amounts due and payable on or prior to the Closing Date, including, to the
extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by either Borrower hereunder or under any
other Loan Document.
71
66
(f) Each of the Guarantee Agreements shall have been duly executed by
the parties thereto and delivered to the Collateral Agent and shall be in
full force and effect.
(g) (i) The Pledge Agreements and the Bond Pledge Agreements shall
have been duly executed by the parties thereto and delivered to the
Collateral Agent and shall be in full force and effect, and (i) all the
outstanding capital stock of SLP US and its Domestic Subsidiaries owned,
directly or indirectly, by Stone and all the outstanding capital stock of
each Subsidiary of Canco shall have been duly and validly pledged
thereunder to the Collateral Agent and certificates representing such
shares, accompanied in the case of certificated shares by stock powers
endorsed in blank, shall be in the actual possession of the Collateral
Agent; and (ii) the Security Agreements and the Hypothecs shall have been
duly executed by the Loan Parties party thereto and shall have been
delivered to the Collateral Agent and shall be in full force and effect on
such date and each document (including each Uniform Commercial Code
financing statement) reasonably requested by the Agents to be filed,
registered or recorded in order to create in favor of the Collateral Agent
a valid, legal and perfected or published first-priority or first ranking
security interest in and lien on the Collateral described in each such
agreement (subject to any Lien expressly permitted by Section 7.02) shall
have been delivered to the Collateral Agent or the Trustee, as the case may
be.
(h) The Collateral Agent shall have received (i) the results of a
search of the Uniform Commercial Code filings made with respect to the Loan
Parties in the states in which the chief executive office of each such
person is located and the other jurisdictions in which Uniform Commercial
Code filings are to be made pursuant to the preceding paragraph, together
with copies of the financing statements disclosed by such search and (ii)
the results of equivalent searches made in each other jurisdiction
reasonably requested by the Agents, in each case accompanied by evidence
reasonably satisfactory to the Agents that the Liens indicated in any such
financing statement (or similar document) or otherwise disclosed in such
searches would be permitted under Section 7.02 or have been released.
(i) (i) Each of the Mortgages, relating to each of the Mortgaged
Properties shall have been duly executed by the parties thereto and
delivered to the Collateral Agent and shall be in full force and effect,
(ii) each of such Mortgaged Properties shall not be subject to any Lien
other than those expressly permitted under Section 7.02, (iii) a lender's
title insurance policy or, in the case of Mortgaged Property located in
Canada, except as otherwise agreed to by the Agents, a written legal
opinion, together with such surveys reasonably requested by the Agents,
paid for by the Borrowers, in form and substance reasonably acceptable to
the Agents, insuring or opining, as the case may be, that such Mortgage
constitutes a first lien on such Mortgaged Property (subject to any Lien
expressly permitted by Section 7.02 or otherwise agreed to by the Agents)
shall have been received by the Agents and (iv) the Collateral Agent shall
have received such other documents as reasonably requested in writing by
the Agents.
(j) The Administrative Agent shall have received copies of, or an
insurance broker's or agent's certificate as to coverage under, the
insurance policies required by Section 6.02 and the applicable provisions
of the Security Documents, each of which policies shall be endorsed or
otherwise amended to include a lender's loss payable endorsement and to
name the Collateral Agent as additional insured, in form and substance
reasonably satisfactory to the Administrative Agent.
72
67
(k) Except with respect to the Final Transaction Steps, the
Acquisition shall have been consummated substantially simultaneously with
the initial Credit Event hereunder in accordance (i) in all material
respects with applicable law and (ii) in all material respects with the
terms of the Reorganization Agreement; and the conditions to Stone's
obligations set forth in the Pre-Merger Agreement shall have been satisfied
without giving effect to any waiver or amendment in any manner materially
adverse to the Lenders that was not approved by the Agents.
(l) All principal, premium (if any), interest, fees and other amounts
due and owing under the Existing SLP Indebtedness shall have been paid in
full, the commitments thereunder terminated and all guarantees thereof and
security therefor released and discharged, and the Agents shall have
received reasonably satisfactory evidence thereof. After giving effect to
the Acquisition and the other Transactions, SLP US, Canco and their
respective subsidiaries shall have outstanding no Indebtedness other than
Loans hereunder and Indebtedness set forth on Schedule 7.01.
(m) The Administrative Agent shall have received the financial
statements referred to in Section 4.05, which financial statements shall
not be materially inconsistent with the information, projections and
financial models delivered prior to the date hereof.
(n) All requisite material approvals and consents to the Acquisition
and the other Transactions of or from Governmental Authorities and all
material third parties shall have been received to the extent required and
all applicable appeal periods shall have expired and there shall be no
governmental or judicial action, actual or threatened, that has or could
have a reasonable likelihood of restraining, preventing or imposing
materially burdensome conditions on the Acquisition (including the Final
Transaction Steps) and the other Transactions, or the consummation of the
other transactions contemplated hereby or that would require any
divestiture of a material portion of the assets of Canco.
ARTICLE VI
Affirmative Covenants
Each Borrower covenants and agrees with each Lender, each Agent, the
Administrative Agent and the Facing Agent that, so long as this Agreement shall
remain in effect, the LC Exposure shall not equal zero or the principal of or
interest on any Loan or any LC Disbursement, Fees or any other expenses or
amounts payable under any Loan Document shall remain unpaid, unless the Required
Lenders shall otherwise consent in writing, it will, and will cause each of the
Subsidiaries to:
SECTION 6.01. Existence; Businesses and Properties. (a) Do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence, except as otherwise permitted under Section 7.05.
(b) Do or cause to be done all things necessary to preserve, renew and keep
in full force and effect the rights, licenses, permits, trademarks, trade names,
privileges and franchises necessary or desirable in the normal conduct of its
business, except for any trademarks, trade names or franchises that are not
material to the business of Stone and the Subsidiaries taken as a whole;
maintain and operate such business in substantially the manner in which it is
currently conducted and operated;
73
68
and at all times keep all property useful and necessary in its business in good
working order and condition to the extent required by sound business practices.
SECTION 6.02. Insurance. Keep its insurable properties adequately insured
at all times by financially sound and reputable insurers; maintain such other
insurance, to such extent and against such risks, including fire and other risks
insured against by extended coverage, as is customary with companies of
established repute in the same general area engaged in the same or similar
businesses, including public liability insurance against claims for personal
injury or death or property damage occurring upon, in, about or in connection
with the use of any properties owned, occupied or controlled by it or the use of
any products sold by it; and maintain such other insurance as may be required by
law and, with respect to the Mortgaged Properties, as is required by the
Mortgages.
SECTION 6.03. Obligations and Taxes. Pay and discharge promptly when due
all taxes, assessments and governmental charges or levies imposed upon it or
upon or in respect of its property or assets, as well as all claims for labor,
materials and supplies or otherwise that, if unpaid, might give rise to a Lien
upon such properties or any part thereof; provided, however, that such payment
and discharge shall not be required with respect to any such obligation, tax,
assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and it shall have
set aside on its books, in accordance with U.S. GAAP, adequate reserves with
respect thereto and such contest operates to suspend enforcement of a Lien and,
in the case of a Mortgaged Property or other material property or asset, there
is no material risk of forfeiture of such property.
SECTION 6.04. Financial Statements, REPORTS, ETC. Furnish to the Agents,
the Administrative Agent, the Facing Agent and each Lender:
(a) in the case of Stone, within 90 days after the end of each fiscal
year, its consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows, showing the financial condition of
Stone and the consolidated Subsidiaries as of the close of such fiscal year
and the results of its operations and the operations of such Subsidiaries
during such year, all audited by Ernst & Young LLP or other independent
auditors of recognized national standing acceptable to the Required Lenders
and accompanied by an opinion of such accountants (which shall not be
qualified in any material respect) to the effect that such consolidated
financial statements fairly present the financial condition and results of
operations of Stone on a consolidated basis in accordance with U.S. GAAP;
(b) in the case of Stone, within 45 days after the end of each of the
first three fiscal quarters of each fiscal year, (i) its consolidated
balance sheet and related statements of operations, stockholders' equity
and cash flows, showing the financial condition of Stone and the
consolidated Subsidiaries as of the close of such fiscal quarter and the
results of its operations and the operations of such Subsidiaries during
such fiscal quarter and the then-elapsed portion of the fiscal year and
(ii) a narrative discussion of the results of operations of Stone and its
consolidated Subsidiaries in a form reasonably satisfactory to the Agents
(it being understood that, in the case of clause (i) above, such
information shall be in reasonable detail and certified by a Financial
Officer of Stone, as fairly presenting the financial condition and results
of operations of Stone on a consolidated basis in accordance with U.S.
GAAP, subject to normal year-end audit adjustments);
(c) concurrently with any delivery of financial statements of Stone
under paragraph (a) or (b) above, a certificate of a Financial Officer of
Stone (i) certifying that,
74
69
after due investigation and reasonable inquiry, no Default or Event of
Default has occurred or, if such a Default or Event of Default has
occurred, specifying the nature and extent thereof and any corrective
action taken or proposed to be taken with respect thereto and (ii) setting
forth computations in reasonable detail satisfactory to the Administrative
Agent of the ratios contemplated by the definition of the term "Applicable
Rate" and demonstrating compliance with the covenants contained in Sections
7.01, 7.02, 7.03, 7.04, 7.06, 7.13, 7.14 and 7.15;
(d) concurrently with any delivery of financial statements under
paragraph (a) above, a certificate of the accounting firm opining on such
statements (which certificate may be limited to accounting matters and
disclaim responsibility for legal interpretations) certifying (i) whether
in connection with its audit examination any Default or Event of Default
has come to its attention and, if such event has come to its attention, the
nature and extent thereof and (ii) that based on its audit examination,
nothing has come to its attention that leads it to believe that the
information contained in the certificate delivered therewith pursuant to
paragraph (c) above is not correct;
(e) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials (other
than (i) the exhibits to registration statements and (ii) any registration
statements on Form S-8 or its equivalent) filed by SSCC, either Borrower or
any of the Subsidiaries with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of or all the functions of such
Commission, or with any securities commission of any Canadian province, or
with any Canadian or U.S. securities exchange, or distributed to any such
Person's shareholders (other than to SSCC, the Borrowers or any of the
Subsidiaries), as the case may be;
(f) in the case of Stone, as soon as available, and in any event no
later than 90 days after each fiscal year, a consolidated annual plan,
prepared in accordance with Stone's normal accounting procedures applied on
a consistent basis, for the next fiscal year of Stone;
(g) upon the earlier of (i) 90 days after the end of each fiscal year
of Stone and (ii) the date on which the financial statements of Stone are
delivered pursuant to paragraph (a) above, a certificate of a Financial
Officer of Stone setting forth, in detail reasonably satisfactory to the
Agents, the amount of Excess Cash Flow, if any, for such fiscal year;
(h) promptly from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrowers, or
compliance with the terms of any Loan Document, as the Agents, the
Administrative Agent, the Facing Agent or any Lender may reasonably
request; and
(i) a copy of all notices (other than notices regarding any scheduled
or mandatory repayments), certificates, financial statements and reports,
as and when delivered by or on behalf of Stone to the holders of any
Subordinated Notes, Senior Notes or First Mortgage Notes.
SECTION 6.05. Litigation and Other Notices. Furnish to the Agents, the
Administrative Agent, the Facing Agent and each Lender prompt written notice of
the following:
(a) any Event of Default or Default, specifying the nature and extent
thereof and the corrective action (if any) proposed to be taken with
respect thereto;
75
70
(b) the filing or commencement of, or any notice to either Borrower or
any Subsidiary of the intention of any Person to file or commence, any
action, suit or proceeding (whether at law or in equity or by or before any
Governmental Authority or any arbitrator, against either Borrower or any
Affiliate thereof) that, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect; and
(c) any development that has resulted in, or could reasonably be
anticipated to result in, a Material Adverse Effect.
SECTION 6.06. Benefit Plans. Comply in all material respects with the
applicable provisions of ERISA and, with respect to any Canadian Pension Plan,
the ITA and any applicable provincial pension legislation, and furnish to the
Agents, the Administrative Agent, the Facing Agent and each Lender (i) as soon
as possible after, and in any event within 30 days after any Responsible Officer
of either Borrower or any ERISA Affiliate either knows or has reason to know
that any Reportable Event has occurred that alone or together with any other
Reportable Event could reasonably be expected to result in liability of either
Borrower or any of the Subsidiaries to the PBGC in an aggregate amount exceeding
U.S.$25,000,000, a copy of the notice of such event required to be given to the
PBGC or, if notice is not so required, a statement of a Financial Officer of
each Borrower, as the case may be, setting forth in reasonable detail the nature
of such event and the action proposed to be taken with respect thereto, (ii)
promptly after receipt thereof, a copy of any notice either Borrower or any
ERISA Affiliate may receive from the PBGC relating to the intention of the PBGC
to terminate any Plan or Plans (other than a Plan maintained by an ERISA
Affiliate that is considered an ERISA Affiliate only pursuant to subsection (m)
or (o) of Section 414 of the Code) or to appoint a trustee to administer any
Plan or Plans, (iii) within 10 days after the due date for filing with the PBGC
pursuant to Section 412(n) of the Code of a notice of failure to make a required
installment or other payment with respect to a Plan, a copy of such notice and a
statement of a Financial Officer of the applicable Borrower setting forth in
reasonable detail the nature of such failure and the action proposed to be taken
with respect thereto, (iv) promptly and in any event within 30 days after
receipt thereof by either Borrower or any ERISA Affiliate from the sponsor of a
Multiemployer Plan, a copy of each notice received by such Borrower or any ERISA
Affiliate concerning (A) the imposition of Withdrawal Liability or (B) a
determination that a Multiemployer Plan is, or is expected to be, terminated or
in reorganization, in each case within the meaning of Title IV of ERISA, (v)
promptly and in any event within 30 days after receipt thereof by either
Borrower or any Subsidiary, a copy of any material notice, ruling or opinion
that either Borrower or any Subsidiary may receive from any applicable
Governmental Authority with respect to any Canadian Pension Plan; and (vi)
notification within 30 days of any material increases in the benefits to be
provided under any existing Canadian Pension Plan or Canadian Benefit Plan, or
the establishment of any new Canadian Pension Plan or Canadian Benefit Plan, or
the commencement of contributions to any such plan to which Canco or any of its
Subsidiaries was not previously contributing.
SECTION 6.07. Maintaining Records; Access to Properties and Inspections.
Maintain all financial records in accordance with U.S. GAAP or Canadian GAAP, as
applicable, and permit any representatives designated by the Agents, the
Administrative Agent, the Facing Agent or any Lender to visit and inspect the
properties and financial records of each Borrower and any Subsidiary during
normal business hours and upon reasonable notice and as often as reasonably
requested and to make extracts from and copies of such financial records, and
permit any representatives designated by the Agents, the Administrative Agent,
the Facing Agent or any Lender to discuss at such reasonable times and at such
reasonable intervals as may be reasonably requested the affairs, finances and
condition of the Borrowers or any Subsidiary or any properties of the Borrowers
or any Subsidiary
76
71
with the officers thereof and independent accountants therefor, provided that
all such visits, inspections and inquiries shall be coordinated through the
Agents.
SECTION 6.08. Use of Proceeds. The proceeds of the Term Loans will be used
on the Closing Date only (i) to directly or indirectly pay the Cash
Consideration, (ii) to refinance the Existing SLP Indebtedness and repay certain
other outstanding indebtedness of Canco and (iii) to pay the fees, costs and
expenses incurred in connection with the Transactions. The proceeds of the
Revolving Loans will be used only for general corporate purposes. No part of the
proceeds of any Loan will be used, whether directly or indirectly, for any
purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X. Letters of Credit will be issued only for
general corporate purposes of Canco and its Subsidiaries.
SECTION 6.09. Compliance with Law. Comply with the requirements of all
applicable laws (including Environmental Laws), rules, regulations, court orders
and decrees, and orders of any Governmental Authority, that are applicable to it
or to any of its properties, except where noncompliance could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 6.10. Further Assurances. (a) Execute any and all further
documents, financing statements, agreements and instruments, and take all
further action (including filing Uniform Commercial Code and other financing
statements, mortgages, hypothecs and deeds of trust), that may be required under
applicable law or which the Required Lenders, any Agent or the Administrative
Agent may reasonably request, in order to effectuate the transactions
contemplated by the Loan Documents and in order to grant, preserve, protect and
perfect the validity and first priority of the security interests created or
intended to be created by the Security Documents.
(b) Cause (i) each Subsidiary that is or becomes a Material Subsidiary and
(ii) each Domestic Subsidiary of SLP US or Canadian Subsidiary of Canco (in each
case, other than any Inactive Subsidiary) to undertake the obligation of, and to
become a Guarantor pursuant to, a Canco Subsidiary Guarantee Agreement or a
Stone Subsidiary Guarantee Agreement, as applicable; provided, however, that no
(x) Foreign Subsidiary shall be required to guarantee the Obligations of Stone
hereunder and (y) each such Subsidiary that owns real or personal property in
the State of Maryland shall undertake the obligation of, and become a Guarantor
pursuant to, a Maryland Subsidiary Guarantee Agreement.
(c) From time to time, to the extent not prohibited by any Specified Senior
Indenture, the Borrowers will, at their cost and expense, promptly secure the
Obligations by pledging or creating, or causing to be pledged or created,
perfected (or, in the case of assets or properties located in the Province of
Quebec, published) security interests with respect to such of the assets and
properties of SLP US and its wholly owned Domestic Subsidiaries and of Canco and
its wholly owned Canadian Subsidiaries as either Agent or the Required Lenders
shall reasonably request (it being understood that it is the intent of the
parties that to the extent not prohibited by any Specified Senior Indenture, (x)
the Obligations of Stone shall be secured by substantially all of the assets of
SLP US and its wholly owned Domestic Subsidiaries and (y) the Obligations of
Canco shall be secured by substantially all of the assets of SLP US and its
wholly owned Domestic Subsidiaries and by substantially all of the assets of
Canco and all wholly owned Canadian Subsidiaries of Canco (other than assets
owned directly or indirectly by Stone prior to the Acquisition)). Such security
interests and Liens will be created under the Security Documents and other
security agreements, mortgages, deeds of trust and other instruments and
documents in form and substance reasonably satisfactory to the Collateral Agent,
and the Borrowers shall deliver or cause to be delivered to the Lenders all such
instruments and documents (including customary legal opinions, title insurance
policies or title opinions and lien searches) as the Collateral Agent shall
reasonably request to evidence compliance
77
72
with this Section. The Borrowers agree to provide such evidence as the
Collateral Agent shall reasonably request as to the perfection and priority
status of each such security interest and Lien. Notwithstanding the foregoing,
no after-acquired real property having a value of less than U.S.$500,000 shall
be required to be mortgaged or pledged to secure all or any part of the
Obligations. To the extent that the assets and/or properties of any Subsidiary
of SLP US or Canco existing on the date hereof are not pledged because (x) of a
legal or other restriction impeding such pledge or (y) such Subsidiary is not
wholly owned, if such restriction subsequently becomes inapplicable or such
Subsidiary subsequently becomes wholly owned, the Borrowers will, at their cost
and expense, promptly cause the assets and/or properties of such Subsidiary to
be pledged and the security interest therein perfected or published, as
applicable.
(d) In the event that any survey of Mortgaged Property discloses any matter
(including any encroachment or violation of an existing servitude, right of way,
reservation made in the grant from the Crown easement or restrictive covenant)
the effect of which is to detract materially from the value of the property
subject thereto or to interfere in any material respect with the ordinary
conduct of the business of either Borrower or any of the Subsidiaries, the
applicable Borrower shall, reasonable upon request by any Agent or the
Administrative Agent, use reasonable efforts (or cause the Subsidiary that is
the user or owner of the Mortgaged Property in question to use reasonable
efforts) to cause such matter to be corrected or otherwise resolved to the
reasonable satisfaction of the Agents.
(e) Cause the Canadian Amalgamations and the Post Closing Distributions to
occur as promptly as practicable (and in any event within 10 days) following the
Closing Date, and provide reasonably satisfactory evidence thereof to the
Agents.
SECTION 6.11. Material Contracts. Maintain in full force and effect
(including exercising any available renewal option), and without amendment or
modification, each Material Contract, unless the failure so to maintain any such
Material Contract (or any amendment or modification thereto) could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
SECTION 6.12. Environmental Matters. (a) Promptly give notice to the
Administrative Agent upon becoming aware of (i) any violation of any
Environmental Law, (ii) any claim, inquiry, proceeding, investigation or other
action, including a request for information or a notice of potential
environmental liability, by or from any Governmental Authority or any third
party claimant or (iii) the discovery of the release of any Hazardous Material
at, on, under or from any of the Real Properties or any facility or equipment
thereat in excess of reportable or allowable standards or levels under any
Environmental Law, or in a manner or amount that could reasonably be expected to
result in liability under any Environmental Law, in each case that could
reasonably be expected to result in a Material Adverse Effect.
(b) Upon discovery of the presence on any of the Real Properties of any
Hazardous Material that is in violation of, or that could reasonably be expected
to result in liability under, any Environmental Law, in each case that could
result in a Material Adverse Effect, take all necessary steps to initiate and
expeditiously complete all remedial, corrective and other action to eliminate
any such adverse effect, and keep the Administrative Agent informed of such
actions and the results thereof.
SECTION 6.13 Surveys. Within 120 days after the Closing Date, for each
Mortgaged Property identified on Schedule 6.13 attached hereto having a fair
market value of U.S.$1,000,000 or more, deliver or cause to be delivered (i) an
A.L.T.A. survey or (ii) a perimeter
78
73
survey as indicated on such Schedule, all such surveys to be in form and
substance reasonably satisfactory to the Administrative Agent and endorsements
to the title policies required by Section 5.02(i) providing for survey-related
coverage reasonably satisfactory to the Administrative Agent.
ARTICLE VII
Negative Covenants
Each Borrower covenants and agrees with each Lender, each Agent, the
Administrative Agent, and the Facing Agent that, so long as this Agreement shall
remain in effect, the LC Exposure shall not equal zero or the principal of or
interest on any Loan or any LC Disbursement, Fees or any other expenses or
amounts payable under any Loan Document shall remain unpaid, unless the Required
Lenders shall otherwise consent in writing, it will not, and will not cause or
permit any of the Subsidiaries to:
SECTION 7.01. Indebtedness. Create, incur, assume or permit to exist any
Indebtedness, except, without duplication:
(a) the Indebtedness created hereunder and under the other Loan
Documents;
(b) Indebtedness under the Existing Stone Credit Agreement and under
the Existing Stone Loan Documents, the Subordinated Notes, the Senior Notes
and the First Mortgage Notes and any Guarantees thereof as in effect on the
Closing Date;
(c) the Indebtedness existing on the Closing Date listed on Schedule
7.01;
(d) Indebtedness of any Foreign Subsidiary (other than a Canadian
Subsidiary) and any Guarantees thereof, provided that such Indebtedness
shall not be Guaranteed by or otherwise recourse to either Borrower or any
Domestic Subsidiary or Canadian Subsidiary except as permitted by Section
7.01(o) or Section 7.04(c);
(e) Indebtedness of either Borrower and Guarantees thereof the net
proceeds of which are used substantially concurrently to refinance
Indebtedness described in paragraph (b) or (c) above so long as (i) no SLP
Credit Party or Canco Credit Party shall become an obligor with respect to
such refinancing Indebtedness unless and to the extent it was an obligor
with respect to the Indebtedness being refinanced, (ii) such refinancing
Indebtedness is in an aggregate principal amount not greater than the
aggregate principal amount of the Indebtedness being refinanced plus the
amount of any premium required to be paid thereon and any interest, fees
and costs incurred in such refinancing, (iii) such Indebtedness has a final
maturity more than 90 days later than the Term Loan Maturity Date and a
weighted average life greater than the Term Loans and (iv) each of the
covenants, events of default and other provisions thereof (including any
Guarantees thereof) shall be no more materially adverse, when taken as a
whole, to the Lenders than those contained in the Indebtedness being
refinanced, provided that (A) if the proceeds of revolving loans under the
Existing Stone Credit Agreement are used to repurchase or redeem any Senior
Notes, Subordinated Notes or First Mortgage Notes, Stone may incur
Indebtedness otherwise meeting the requirements of this paragraph (e) (as
if such Indebtedness were used to refinance such Senior Notes, Subordinated
Notes or First Mortgage Notes) to repay such revolving loans, (B) the First
Mortgage Notes may be refinanced as senior secured bank
79
74
indebtedness and may include such covenants, events of defaults and other
terms and conditions no more materially adverse to Stone or the Lenders
when taken as a whole than the terms contained in this Agreement and (C)
the Subordinated Notes, Senior Notes and the First Mortgage Notes may be
refinanced to include covenants, events of default and other terms and
conditions that are no more restrictive to Stone or the Subsidiaries than
is customary, at the time of such refinancing, for senior unsecured (or
secured, in the case of the First Mortgage Notes) notes for issuers with a
debt-rating similar to Stone;
(f)(i) Capital Lease Obligations, (ii) Indebtedness created, incurred
or assumed in respect of the purchase, improvement or construction of
property, provided such Indebtedness is created, incurred or assumed
substantially contemporaneously with such purchase or construction (and in
any event not later than 120 days after the earlier of (x) the placement in
service of or (y) the final payment on such property) and (iii)
Indebtedness consisting of industrial revenue bonds or pollution control
bonds, and Guarantees of such Indebtedness, such that the sum of the
Indebtedness created, incurred or assumed pursuant to this clause (f) shall
not exceed, in the aggregate U.S.$300,000,000 at any time outstanding,
provided that any Indebtedness incurred by the SLP Credit Parties and the
Canco Credit Parties pursuant to this clause (f) shall be limited to
U.S.$100,000,000 in aggregate principal amount at any time outstanding;
(g) Indebtedness created pursuant to any Rate Protection Agreement or
Currency Agreement;
(h) intercompany loans and advances permitted by Section 7.04,
provided that any such intercompany loans or advances from SLP Credit
Parties or Canco Credit Parties to a Borrower or any other Subsidiary shall
be evidenced by an intercompany note pledged to BTCo, as Collateral Agent,
to secure the Obligations, pursuant to a Pledge Agreement; provided further
that no such intercompany notes shall be pledged by any Canco Credit Party
to secure any Obligations of Stone or any SLP Credit Party;
(i) Indebtedness of Stone or any Participating Subsidiary created
pursuant to the Receivables Program Documents (including any Indebtedness
of Stone or any Participating Subsidiary to FinSub arising because any sale
or purported sale of Program Receivables to FinSub is required to be
recharacterized as a loan);
(j) Indebtedness of FinSub to Stone or any other Participating
Subsidiary, when combined with any capital contributions pursuant to
Section 7.04(g), not exceeding U.S.$50,000,000 in an aggregate amount at
any time outstanding;
(k) Indebtedness incurred to pay annual premiums for property and
casualty insurance policies maintained by either Borrower or any Subsidiary
and other prepaid amounts in respect of goods or services purchased by the
Borrowers or the Subsidiaries in the ordinary course of business not
exceeding U.S.$40,000,000 in an aggregate amount at any time outstanding;
(l) Indebtedness of the Borrowers and their Subsidiaries and
Guarantees thereof in respect of letters of credit that are not secured and
do not exceed U.S.$25,000,000 in an aggregate amount at any time
outstanding;
(m) Indebtedness of any Person acquired by a Borrower or any
Subsidiary in an acquisition permitted hereunder and assumed by a Borrower
or any Subsidiary pursuant to
80
75
such acquisition (including any refinancing, renewal or replacement, in
whole or in part, thereof from time to time), provided that (i) such
Indebtedness was not incurred in contemplation of such acquisition and (ii)
the aggregate principal amount of such Indebtedness shall not exceed
U.S.$25,000,000 at any time outstanding ("Acquired Indebtedness");
(n) Guarantees with respect to bonds issued to support workers'
compensation and other similar obligations (other than Indebtedness)
incurred by a Borrower or any Subsidiary in the ordinary course of
business;
(o) Indebtedness of a Borrower or any Subsidiary and Guarantees
thereof incurred in the ordinary course of business that does not exceed
U.S.$100,000,000 in the aggregate at any time outstanding, provided that
any Indebtedness incurred by the SLP Credit Parties and the Canco Credit
Parties pursuant to this clause (o) shall be limited to U.S.$50,000,000 in
an aggregate amount at any time outstanding; and
(p) Indebtedness of MBI Limited following the MBI Transaction that is
unsecured in an aggregate amount not to exceed U.S.$55,000,000 at any time
outstanding.
SECTION 7.02. Liens. (a) Create, incur, assume or permit to exist any Lien
on any property or assets (including stock or other securities of any Person)
now owned or hereafter acquired by it or on any income or revenues or rights in
respect of any thereof, except:
(i) Permitted Liens;
(ii) Liens created under the Loan Documents;
(iii) Liens on the Existing Stone Collateral that secure the
obligations (including the guarantees thereof) of Stone under the Existing
Stone Loan Documents;
(iv) Liens on Program Receivables granted pursuant to the Receivables
Program Documents;
(v) Liens existing on the Closing Date that secure the First Mortgage
Notes or any refinancing thereof pursuant to Section 7.01(e), provided that
such Liens shall apply only to the property that is the subject of such
Liens as of the Closing Date, or any replacement or substitution of such
property on the terms and conditions contained in the First Mortgage Note
Indenture as in effect on the Closing Date;
(vi) Liens existing as of the Closing Date and listed on Schedule
7.02;
(vii) Liens securing Indebtedness permitted by Section 7.01(f),
provided that any such Lien shall apply only to the property that is the
subject of such Indebtedness and, if applicable, the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 100% of the
fair market value (as determined in good faith by the Board of Directors of
the applicable Borrower or Subsidiary) of the respective property at the
time it was so acquired;
(viii) Liens for Indebtedness permitted by Section 7.01(k), provided
that such Liens attach only to unearned and return premiums, dividends and
loss payments which reduce the
81
76
unearned premiums under insurance policies the premiums of which have been
financed with such Indebtedness;
(ix) Liens securing any Acquired Indebtedness assumed in connection
with any acquisition permitted hereunder, provided that such Liens attach
only to property or assets acquired in connection with such acquisition and
were not created in contemplation thereof;
(x) Liens on property or assets owned by Foreign Subsidiaries securing
Indebtedness permitted under Section 7.01(d);
(xi) Liens created under any agreement relating to the sale, transfer
or other disposition of assets permitted hereunder, provided that such
Liens relate solely to the assets to be sold, transferred or otherwise
disposed;
(xii) any Lien consisting of a lease of personal property of a Person
to customers of such Person, if such lease constitutes an Investment
permitted under Section 7.04(i);
(xiii) Liens deemed to exist in connection with any Permitted
Investment, provided such Liens only apply to the assets constituting such
Permitted Investment;
(xiv) Liens on assets of a Borrower or any Subsidiary securing
Indebtedness permitted by Section 7.01(o) not exceeding U.S.$100,000,000 in
an aggregate amount outstanding at any time, provided that not more than
U.S.$25,000,000 of such Indebtedness incurred by the SLP Credit Parties and
the Canco Credit Parties may be secured at any time, and provided further
that no such Lien shall apply to any assets constituting Collateral; and
(xv) extensions, renewals or replacements of any Lien referred to
above, provided that such extension, renewal or replacement is limited to
the Indebtedness and property originally encumbered thereby.
(b) Enter into any agreement prohibiting the creation or assumption of any
Lien upon properties or assets, whether now owned or hereafter acquired, except
any such restriction that exists under (i) this Agreement, (ii) the indentures
governing the Subordinated Notes, the Senior Notes or the First Mortgage Notes
(or any refinancing thereof pursuant to Section 7.01(e)), (iii) with respect to
FinSub, the Receivables Program, (iv) the Existing Stone Loan Documents, (v)
agreements governing any Indebtedness of Foreign Subsidiaries (other than Canco
and the other Canadian Subsidiaries) permitted hereunder and (vi) any documents
governing secured Indebtedness permitted hereunder, provided that such
restrictions only relate to the assets securing such Indebtedness.
SECTION 7.03. Sale/Leaseback Transactions. Enter into any arrangement,
direct or indirect, whereby either Borrower or any of the Subsidiaries shall
sell or transfer any property, real or personal, used or useful in its business,
hereafter acquired, and thereafter rent or lease such property or other property
that it intends to use for substantially the same purpose or purposes as the
property sold or transferred, provided that the Borrowers and the Subsidiaries
may enter into any such arrangement to the extent that the Capital Lease
Obligations and Liens associated therewith would be permitted by Sections
7.01(f)(i) and 7.02(a)(vii), respectively, and, provided further that, if either
Borrower or any of the Subsidiaries enter into such an arrangement with respect
to any property owned by such Borrower or any Subsidiary more than 120 days
prior to such transaction, such arrangement shall be treated as an Asset Sale
and shall also be subject to the restrictions of Section 7.16.
82
77
SECTION 7.04. Investments, Loans and Advances. Have outstanding or make any
loan or advance to or have or make any Investment in any other Person or suffer
to exist any such loan or advance or Investment or any obligation to make such
advance or Investment, except as set forth on Schedule 7.04 and except:
(a) Permitted Investments;
(b) loans, advances or other Investments made by (i) either Borrower
or any Subsidiary to either Borrower, any wholly owned Canadian Subsidiary,
any Guarantor or any wholly owned Domestic Subsidiary (provided that any
Loan Party complies with the requirements of Section 7.16) and (ii) any
Foreign Subsidiary (other than a Canadian Subsidiary) to any other Foreign
Subsidiary;
(c) loans, advances or other Investments made to or in any Subsidiary
(other than a Guarantor, a wholly owned Domestic Subsidiary or a wholly
owned Canadian Subsidiary) and Guarantees of obligations of any such
Subsidiary in an aggregate amount not to exceed U.S.$100,000,000
outstanding at any time;
(d) Investments consisting of non-cash consideration received in
connection with a sale of assets permitted under Section 7.16;
(e) Investments by either Borrower or any Subsidiary in the capital
stock of their respective subsidiaries in existence on the Closing Date;
(f) Investments consisting of securities or notes received in
settlement of accounts receivable incurred in the ordinary course of
business from a customer which either Borrower or any Subsidiary has
reasonably determined is unable to make cash payments in accordance with
the terms of such account receivable;
(g) Investments by Stone or any Participating Subsidiary in FinSub,
when combined with any Indebtedness outstanding pursuant to Section
7.01(j), in an aggregate amount not to exceed U.S.$50,000,000 at any time
outstanding;
(h) prepaid expenses or accounts receivable created or acquired in the
ordinary course of business;
(i) any Investments consisting of (i) any contract pursuant to which a
Borrower or any Subsidiary obtains the right to cut, harvest or otherwise
acquire timber on property owned by any other Person, whether or not such
Borrower's or the Subsidiary's obligations under such contract are
evidenced by a note or other instrument, or (ii) loans or advances to
customers of a Borrower or any Subsidiary, including leases of personal
property of such Borrower or such Subsidiary to such customers, provided
that the contracts, loans and advances constituting permitted Investments
pursuant to this clause (i) shall not exceed U.S.$10,000,000 at any time
outstanding;
(j) deposits made in the ordinary course of business to secure
performance of operating leases;
(k) loans to officers and employees not to exceed U.S.$5,000,000 at
any time outstanding;
83
78
(l) Investments, loans and advances made in connection with the
Acquisition and as contemplated by the Reorganization Agreement (as in
effect on the Closing Date);
(m) other Investments in an aggregate amount not exceeding
U.S.$100,000,000 at any time outstanding;
(n) (i) intercompany loans evidenced by the Cameo Note and the SCC
Xxxxx Note pursuant to Liability Management Transactions; provided that
such notes are unsecured and otherwise in form and substance satisfactory
to the Administrative Agent, and it being agreed that the Cameo Note and
SCC Xxxxx Note will not be required to be pledged as Collateral; and (ii)
intercompany loans made by Stone to SCC RMMI and SCC AMMI on a revolving
credit basis pursuant to a revolving credit agreement, notes and other
documentation in form and substance satisfactory to the Administrative
Agent;
(o) Stone may make additional capital contributions to SCC RMMI and
SCC AMMI pursuant to the stockholders' agreements contemplated by the
Liability Management Transactions, provided that such stockholders'
agreements are in form and substance satisfactory to the Administrative
Agent; and
(p) Investments made in any Subsidiary with the proceeds of any
Investment received from SSCC.
Notwithstanding the foregoing, neither Stone nor Canco shall permit more than
15% of its consolidated revenues or 15% of its consolidated assets for any
fiscal year to be generated or held by any Domestic Subsidiaries or Canadian
Subsidiaries, respectively, in the aggregate, that are not Loan Parties.
SECTION 7.05. Mergers, Consolidations, Sales of Assets and Acquisitions.
Merge into or amalgamate or consolidate with any other Person, or permit any
other Person to merge into or amalgamate or consolidate with it, or sell,
transfer, assign, lease, sublease or otherwise dispose of (in one transaction or
in a series of transactions) all or substantially all of its assets (when taken
as a whole in combination with the other assets and properties of the Borrowers
and the Subsidiaries), or purchase, lease or otherwise acquire (in one
transaction or a series of transactions) all or any substantial part of the
assets of any other Person except:
(a) if at the time thereof and immediately after giving effect thereto
no Default or Event of Default shall have occurred and be continuing, (i)
any wholly owned Domestic Subsidiary (other than FinSub and SLP US and its
subsidiaries) may merge into or consolidate with, liquidate or dissolve
into, or sell, transfer, assign, lease, sublease or otherwise dispose of
all or substantially all of its assets to, Stone in a transaction in which
Stone is the surviving corporation, (ii) any wholly owned Domestic
Subsidiary (other than FinSub) may merge into or consolidate with,
liquidate or dissolve into, or sell, transfer, assign, lease, sublease or
otherwise dispose of all or substantially all of its assets to, SLP US or
any other wholly owned Domestic Subsidiary in a transaction in which the
surviving entity is SLP US or a wholly owned Domestic Subsidiary (provided
that SLP US shall be the surviving entity if it is a party to such
transaction), and (iii) any wholly owned Canadian Subsidiary may merge into
or consolidate or amalgamate with, liquidate or dissolve into, or sell,
transfer, assign, lease, sublease or otherwise dispose of all or
substantially all of its assets to, Canco or any other wholly owned
Canadian Subsidiary in a transaction in which a Canco Credit Party is the
surviving corporation (provided that Canco shall be the surviving entity if
it is a party to such transaction), provided that, in each case, (x) no
Person other
84
79
than Stone or Canco, as the case may be, or a wholly owned Domestic
Subsidiary or Canadian Subsidiary, as the case may be, receives any
consideration and (y) in the event that the surviving entity would become a
wholly owned Domestic Subsidiary of SLP US or a wholly owned Canadian
Subsidiary of Canco and has not previously become a Guarantor, the
surviving entity shall, simultaneously with such merger or consolidation,
comply with the requirements of Section 6.10(b) to the extent required by
such Section 6.10(b);
(b) if at the time thereof and immediately after giving effect thereto
no Default or Event of Default shall have occurred and be continuing, any
wholly owned Foreign Subsidiary (other than a Canadian Subsidiary) may
merge into or consolidate with, liquidate or dissolve into, or sell,
transfer, assign, lease, sublease or otherwise dispose of all or
substantially all of its assets to, any other wholly owned Foreign
Subsidiary in a transaction in which the surviving entity is a wholly owned
Foreign Subsidiary, provided that no Person other than Stone, an SLP Credit
Party or a wholly owned Foreign Subsidiary receives any consideration;
(c) purchases of inventory, equipment and real property in the
ordinary course of business;
(d) acquisitions constituting Consolidated Capital Expenditures
permitted by Section 7.13;
(e) acquisitions, mergers and other transfers constituting Investments
permitted by Section 7.04, provided (i) that Stone or Canco, as the case
may be, shall be the surviving corporation in any merger or consolidation
between it and any other Person and that in any merger or consolidation
involving a Subsidiary that is a Loan Party, the surviving entity is a Loan
Party and (ii) this clause (e) shall not permit the merger or consolidation
of SLP US and Stone; and
(f) the Acquisition (including amalgamations, mergers and liquidations
of various Subsidiaries in connection therewith as contemplated by the
Reorganization Agreement) and the continuation of Canco as a New Brunswick
corporation.
SECTION 7.06. Restricted Payments. (a) Declare or make, directly or
indirectly, any Restricted Payment or set aside any amount for any such purpose.
(b) Notwithstanding the provisions of Section 7.06(a), each Borrower or any
Subsidiary may make Restricted Payments, provided that (i) such Restricted
Payment is in compliance with applicable law, (ii) at the time of such payment
and immediately after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing and (iii) the aggregate amount of such
Restricted Payment, together with the aggregate amount of all other Restricted
Payments paid by the Borrowers and the Subsidiaries in the fiscal year in which
the Restricted Payment is proposed to be paid, shall not exceed the lesser of
(A) 25% of Consolidated Net Income for the fiscal year preceding the year in
which the Restricted Payment is proposed to be paid, (B) Stone's portion of
Excess Cash Flow for the fiscal year preceding the year in which the Restricted
Payment is proposed to be paid and (C) $25,000,000.
SECTION 7.07. Transactions with Stockholders and Affiliates. Except to the
extent specifically permitted by the terms of this Agreement, directly or
indirectly enter into or permit to exist any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder of 5% or more of any class of equity securities of such
85
80
Person or with any Affiliate of such Person or of any such holder, on terms that
are less favorable to such Person than those that could be obtained at the time
from Persons that are not such a holder or Affiliate, provided that the
foregoing restriction shall not apply to (a) any transaction between or among
the Loan Parties or any transaction between or among Foreign Subsidiaries that
are not Loan Parties, (b) any transaction or series of transactions between or
among Stone and/or any Subsidiary on a basis that is not systematically
disadvantageous to Stone or any other Loan Party, (c) customary fees paid to
members of the Boards of Directors of the Borrowers or any of the Subsidiaries,
(d) customary compensation (including salaries and bonuses) paid to officers and
employees of the Borrowers or any Subsidiary, (e) management and financial
services provided by a Borrower to the Subsidiaries and other entities in which
such Borrower has Investments to the extent that such services are provided by
such Borrower in the ordinary course of its business and senior management of
such Borrower has determined that the providing of such services is in the best
interests of such Borrower, (f) the transactions contemplated by the Receivables
Program Documents, (g) the Acquisition and any other transactions contemplated
by the Pre-Merger Agreement, the SLP Acquisition Documents or the Reorganization
Agreement and (h) the MBI Transaction.
SECTION 7.08. Business. Engage at any time in any business or business
activity other than the business conducted by the Borrowers and the Subsidiaries
on the Closing Date and business activities reasonably related thereto.
SECTION 7.09. Limitations on Debt Prepayments. (a) Optionally prepay,
repurchase or redeem or otherwise defease or segregate funds (collectively,
"repay") with respect to any Indebtedness for borrowed money of either Borrower
or any of the Subsidiaries; provided, however, that (i) each Borrower and any
Subsidiary shall be permitted (x) to make any payment permitted or required
pursuant to any Loan Document or any Existing Stone Loan Document, (y) so long
as no Default or Event of Default shall have occurred and be continuing, to
repay any intercompany Indebtedness permitted pursuant to Section 7.01, and (z)
to refinance or replace any Indebtedness as otherwise permitted hereunder and
(ii) Stone shall be permitted to repay, on a voluntary basis, all or any portion
of the Subordinated Notes, the Senior Notes or the First Mortgage Notes, in each
case, having a final maturity prior to December 31, 2002 (or if all such
Indebtedness has been repaid or refinanced pursuant to Section 7.01(e) or
Section 7.04, the Senior Notes due 2004) in an aggregate amount, including any
premium paid in connection therewith, not in excess of the sum of (A)
U.S.$400,000,000, provided that such amount shall increase to U.S.$800,000,000
so long as, according to the most recent quarterly financial statement delivered
pursuant to Section 6.04(b) of this Agreement, the Consolidated Leverage Ratio,
before and after giving effect to such repayment, is less than 3.00 to 1.00, (B)
the Net Cash Proceeds from the issuance of capital stock to, or the contribution
of capital from, SSCC after the Closing Date, (C) the Net Cash Proceeds of any
Asset Sale that the applicable Borrower has elected to apply to the prepayment
of such Indebtedness pursuant to the second sentence of Section 2.13(b) and (D)
any Prepayment Amount which either Borrower is entitled to use to prepay
Indebtedness pursuant to Section 2.13(h), provided further that at the time of
any such redemption, after giving effect to such redemption, no Default or Event
of Default shall have occurred and be continuing.
(b) Permit any amendment, waiver or modification to the terms of the
Existing Stone Loan Documents or the indentures or agreements governing the
Subordinated Notes, the Senior Notes or the First Mortgage Notes or any
indenture or agreement entered into in connection with the foregoing (or any
refinancing thereof pursuant to Section 7.01(e)) if the effect of such
amendment, waiver or modification is to impose additional or increased scheduled
or mandatory repayment, retirement, repurchase or redemption obligations in
respect of such Indebtedness or to require any
86
81
scheduled or mandatory payment to be made in respect of such Indebtedness prior
to the date that such payment would otherwise be due.
(c) Make any offer to purchase, or redeem or purchase, any Indebtedness
created pursuant to or evidenced by the Specified Senior Indentures pursuant to
a "Deficiency Offer" made in accordance with Article Eleven (or any other
similar Article or provision) of such indenture.
SECTION 7.10. Amendment of Certain Documents. (a) Amend, modify, cancel or
grant any waiver with respect to any indenture, note or any other instrument
evidencing Indebtedness of either Borrower or any Subsidiary in an aggregate
principal amount in excess of U.S.$50,000,000 or issue any securities in
exchange for such Indebtedness if such amendment, modification, cancelation,
grant or issuance has the effect of (i) increasing the amounts due in respect of
any such indenture, note or other instrument or any interest rate thereunder,
provided that any such increase in amount would be permitted under Section 7.01,
(ii) subjecting any property of either Borrower or any Subsidiary to any Lien
other than Liens permitted under Section 7.02, (iii) shortening the maturity or
weighted average life of any such Indebtedness or (iv) creating or changing any
covenant or similar restriction or event of default if such covenant or similar
restriction becomes materially more restrictive to either Borrower or any
Subsidiary, when taken as a whole, as a result of such amendment, modification,
cancelation, grant or issuance.
(b) Cause or suffer to exist any amendment, restatement, supplement or
other modification to the certificate of incorporation or by-laws of either
Borrower or any Subsidiary without the prior written consent of the Required
Lenders, unless such amendment, restatement, supplement or modification is not
materially adverse to the interests of the Lenders hereunder or under the other
Loan Documents.
(c) Permit, cause or suffer to exist any direct or indirect amendment,
restatement, supplement, waiver or other modification to any of the Receivables
Program Documents unless such amendment, restatement, supplement, waiver or
modification is not materially adverse to the interests of the Lenders under the
Loan Documents, provided that (i) Stone may amend, refinance or replace such
Receivables Program so long as the new Receivables Program Documents are not
materially more restrictive, taken as a whole, on Stone, any Subsidiary or
FinSub than the Receivables Program Documents being refinanced or replaced, (ii)
such new Receivables Program shall continue to be non-recourse to Stone and the
Subsidiaries, (iii) the fair market value of accounts receivable (net of
collections) transferred by Canco and SLP US and their respective subsidiaries
to the Receivables Program shall not exceed U.S.$60,000,000, (iv) the aggregate
size of the Receivables Program shall not exceed the sum of (A) U.S.$355,000,000
and (B) any increase solely associated with any accounts receivable of SSCC and
its subsidiaries (other than Stone and its Subsidiaries) transferred to the
Receivables Program and (v) any Liens on the assets of Stone and the
Subsidiaries pursuant to the new Receivables Program are limited to the accounts
receivable and any returned inventory and intangible assets related to such
accounts.
SECTION 7.11. Limitation on Dispositions of Stock of Subsidiaries. Directly
or indirectly sell, assign, pledge or otherwise encumber or dispose of, or
permit any of the Subsidiaries to issue to any other Person (other than, in the
case of a Loan Party, to any other Loan Party, and in the case of a Subsidiary
that is not a Loan Party, to either Borrower or to any wholly owned Subsidiary),
any shares of capital stock or other equity securities of (or warrants, rights
or options to acquire shares or other equity securities of) any of the
Subsidiaries, except (i) pledges pursuant to (A) any Loan Document or (B) any
Existing Stone Loan Document and (ii) issuance to qualified directors if and to
the extent required by applicable law, provided that nothing in this Section
7.11 shall prohibit any
87
82
disposition permitted by Sections 7.05 and 7.16 if such sale is structured as
the sale of stock or other equity interests.
SECTION 7.12. Restrictions on Ability of Subsidiaries to Pay Dividends.
Permit any Subsidiary to, directly or indirectly, voluntarily create or
otherwise voluntarily cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Subsidiary to (a) pay dividends
or make any other distributions on its capital stock or any other interest or
(b) make or repay loans or advances to any Loan Party or any Canadian Subsidiary
except for encumbrances or restrictions under (i) this Agreement and the other
Loan Documents, (ii) the Existing Stone Loan Documents, (iii) the indentures
governing the Subordinated Notes, the Senior Notes or the First Mortgage Notes
(or any refinancing thereof pursuant to Section 7.01(e)), (iv) with respect to
FinSub, the Receivables Program Documents, (v) documentation governing the
Indebtedness (including Indebtedness incurred after the date hereof) of Stone
Container GmbH and its subsidiaries and (vi) any agreements identified on
Schedule 7.12.
SECTION 7.13. Capital Expenditures. Incur Consolidated Capital
Expenditures, provided that the Borrowers and the Subsidiaries may incur
Consolidated Capital Expenditures in any fiscal year in an aggregate amount not
in excess of U.S.$275,000,000; provided, however, that such amount in respect of
any fiscal year shall be increased by the sum of (i) an amount equal to Stone's
portion of Excess Cash Flow for the prior fiscal year and (ii) the amount (if
greater than zero) equal to (x) $275,000,000 minus (y) the amount of
Consolidated Capital Expenditures actually made in the immediately preceding
fiscal year. Notwithstanding the foregoing limitations on Consolidated Capital
Expenditures, (i) the Borrowers and the Subsidiaries may make Cluster
Expenditures and (ii) the Borrowers and the Subsidiaries may consummate the
Acquisition.
SECTION 7.14. Consolidated EBITDA. Permit Consolidated EBITDA for any four
fiscal quarter period ending on a date set forth below to be less than the
amount set forth opposite such date:
Date Amount
---- ----------------
June 30, 2000 U.S.$350,000,000
September 30, 2000 U.S.$375,000,000
December 31, 2000 U.S.$500,000,000
March 31, 2001 and thereafter U.S.$550,000,000
SECTION 7.15. Interest Coverage Ratio. Permit the ratio of (i) Consolidated
EBITDA to (ii) Consolidated Interest Expense for any four fiscal quarter period
ending on a date set forth below to be less than the ratio set forth opposite
such date:
Date Ratio
---- ------------
June 30, 2000 1.25 to 1.00
September 30, 2000 1.25 to 1.00
December 31, 2000 and thereafter 1.50 to 1.00
SECTION 7.16. Disposition of Collateral and Other Assets. (a) Except for
the sale of Program Receivables as permitted by Section 7.10(c) and the
Receivables Program Documents and except for any disposition permitted by
paragraph (b) below, sell, lease, assign, transfer or otherwise dispose of any
asset or assets, in a single transaction or a series of related transactions
having a fair market value in excess of U.S.$10,000,000, unless (i) fair market
value is received for such asset
88
83
(such fair market value to be determined by the Board of Directors of the
applicable Borrower or any applicable Subsidiary in the exercise of its
reasonable judgment in the case of any asset or assets with a fair market value
in excess of U.S.$50,000,000), (ii) at least 75% of the consideration received
by the Borrowers and the Subsidiaries in connection therewith shall be in cash,
cash equivalents and readily marketable securities and (iii) any non-cash
consideration shall consist of debt obligations of the purchaser, provided that
the foregoing shall not restrict either Borrower or any Subsidiary from
receiving debt obligations of the purchaser in an aggregate principal amount not
in excess of U.S.$30,000,000 in connection with any single transaction or series
of related transactions.
(b) Neither Borrower shall transfer any of its assets to any Subsidiary and
none of the Subsidiaries shall transfer any of its assets to any other
Subsidiary unless (i) in the case of any asset or assets constituting
Collateral, such asset or assets is transferred to a Loan Party and BTCo, as
Collateral Agent, is satisfied that the Liens created under the Security
Documents on such asset or assets shall continue in full force and effect, or
(ii) in the case of any asset or assets not constituting Collateral, such
transfer is permitted as an Investment under Section 7.04.
SECTION 7.17. Fiscal Year. Cause its fiscal year to end on a date other
than December 31.
ARTICLE VIII
Events of Default
In case of the happening of any of the following events (each, an "Event of
Default"):
(a) any representation or warranty made or deemed made in any Loan
Document, or any representation, warranty, statement or information
contained in any report, certificate, financial statement or other
instrument furnished pursuant to any Loan Document, shall prove to have
been false or misleading in any material respect when so made, deemed made
or furnished;
(b) default shall be made in the payment of any principal of any Loan
or LC Disbursement when and as the same shall become due and payable,
whether at the due date thereof or at a date fixed for prepayment thereof
or by acceleration thereof or otherwise;
(c) default shall be made in the payment of any interest on any Loan
or any Fee or any other amount (other than an amount referred to in
paragraph (b) above) due under any Loan Document, when and as the same
shall become due and payable, and such default shall continue unremedied
for a period of three Business Days;
(d) default shall be made in the due observance or performance by
either Borrower of any covenant, condition or agreement contained in
Section 6.01, 6.05(a), 6.08, 6.10(e) or in Article VII;.
(e) default shall be made in the due observance or performance by any
Loan Party or any of their respective Subsidiaries of any covenant,
condition or agreement contained in any Loan Document (other than those
defaults specified in paragraph (b), (c) or (d) above) and such default
shall continue unremedied for a period of 30 days after written notice
thereof from the Administrative Agent or any Lender to the Borrowers;
89
84
(f) either Borrower or any Subsidiary shall (i) fail to pay any
principal or interest, regardless of amount, due in respect of any
Indebtedness in a principal amount in excess of U.S.$10,000,000, when and
as the same shall become due and payable (after giving effect to any
applicable grace period), or (ii) fail to observe or perform any other
term, covenant, condition or agreement contained in any agreement or
instrument evidencing or governing any such Indebtedness (after giving
effect to any applicable grace period), if the effect of any failure
referred to in this clause (ii) is to cause, or to permit the holder or
holders of such Indebtedness or a trustee on its or their behalf to cause,
such Indebtedness to become due prior to its stated maturity;
(g) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of either Borrower, any Material Subsidiary or any
Canadian Subsidiary, or of a substantial part of the property or assets of
any such Person, under any Insolvency Law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official
for any such Person or for a substantial part of the property or assets of
any such Person or (iii) the winding-up or liquidation of any such Person;
and such proceeding or petition shall continue undismissed for 60 days or
an order or decree approving or ordering any of the foregoing shall be
entered;
(h) either Borrower, any Material Subsidiary or any Canadian
Subsidiary shall (i) voluntarily commence any proceeding or file any
petition seeking relief under any Insolvency Law, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in paragraph (g) above,
(iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for any such
Person or for a substantial part of the property or assets of any such
Person, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding, (v) make a general
assignment for the benefit of creditors, (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become due
or (vii) take any action for the purpose of effecting any of the foregoing;
(i) one or more judgments for the payment of money, individually or in
the aggregate, in an amount in excess of U.S.$10,000,000 in any one case or
U.S.$15,000,000 in the aggregate in all such cases (in each case to the
extent not adequately covered by insurance proceeds as to which the
insurance company has acknowledged coverage pursuant to a writing
reasonably satisfactory to the Administrative Agent) shall be rendered
against either Borrower or any of the Subsidiaries or any combination
thereof and the same shall remain undischarged for a period of 30
consecutive days during which execution shall not be effectively stayed,
vacated, discharged or satisfied or any action shall be legally taken by a
judgment creditor to levy upon assets or properties of either Borrower or
any Subsidiary to enforce any such judgment;
(j) a Reportable Event or Reportable Events, or a failure to make a
required installment or other payment (within the meaning of Section
412(n)(l) of the Code), shall have occurred with respect to any Plan or
Plans that reasonably could be expected to result in liability of either
Borrower or any of the Subsidiaries to the PBGC or to a Plan in an
aggregate amount exceeding U.S.$25,000,000 and, within 30 days after the
reporting of any such Reportable Event to the Administrative Agent pursuant
to Section 6.06(b)(i)(A) or after the receipt by the Administrative Agent
of the statement required pursuant to Section 6.06(b)(iii), any Agent or
the Administrative Agent shall have notified either
90
85
Borrower in writing that (i) the Required Lenders have reasonably
determined that, on the basis of such Reportable Event or Reportable Events
or the failure to make a required payment, there are reasonable grounds (A)
for the termination of such Plan or Plans by the PBGC, (B) for the
appointment by the appropriate United States District Court of a trustee to
administer such Plan or Plans or (C) for the imposition of a lien in favor
of a Plan and (ii) as a result thereof an Event of Default exists
hereunder; or a trustee shall be appointed by a United States District
Court to administer any such Plan or Plans; or the PBGC shall institute
proceedings to terminate any Plan or Plans;
(k)(i) either Borrower or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan, (ii) such Borrower or such ERISA
Affiliate does not have reasonable grounds for contesting such Withdrawal
Liability or is not in fact contesting such Withdrawal Liability in a
timely and appropriate manner and (iii) the amount of the Withdrawal
Liability specified in such notice, when aggregated with all other amounts
required to be paid to Multiemployer Plans in connection with Withdrawal
Liabilities (determined as of the date or dates of such notification),
exceeds U.S.$25,000,000;
(l) either Borrower or any ERISA Affiliate shall have been notified by
the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of
ERISA, if solely as a result of such reorganization or termination the
aggregate contributions of such Borrower and its ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or have been or are
being terminated have been or will be increased over the amounts required
to be contributed to such Multiemployer Plans for their most recently
completed plan years by an amount exceeding U.S.$25,000,000;
(m) there shall have occurred a Change in Control or either Borrower
or any Subsidiary shall make any mandatory prepayment, repurchase or
redemption or make any offer to make any such mandatory prepayment,
repurchase or redemption of any Indebtedness governed by any Specified
Senior Indebtedness on account of any "Change of Control" (as such term is
defined in any such Specified Senior Indenture) or any other event relating
to change of control of either Borrower;
(n) any security interest purported to be created by any Security
Document shall cease to be, or shall be asserted by either Borrower not to
be, a valid, perfected (or, in the case of any security interest in assets
located in the Province of Quebec, published), first priority (or, in the
case of any security interest in assets located in the Province of Quebec,
first-ranking) (except as otherwise expressly provided in this Agreement or
such Security Document) security interest in Collateral with a fair market
value or book value (whichever is greater) in excess, individually or in
the aggregate, of U.S.$50,000,000, except to the extent that any such loss
of perfection or priority results from the failure of BTCo, as Collateral
Agent, to maintain possession of certificates representing securities
pledged under the Pledge Agreements or otherwise take any action within its
control (including the filing of Uniform Commercial Code continuation
statements or similar filings under the applicable laws of any other
jurisdiction);
(o) any Loan Document shall not be for any reason, or shall be
asserted by the Loan Party (except as otherwise expressly provided in this
Agreement or such Loan Document) not to be, in full force and effect and
enforceable in all material respects in accordance with its terms;
91
86
(p) the Obligations and the Guarantees thereof pursuant to any
Guarantee Agreement shall cease to constitute, or shall be asserted by any
Loan Party (except as otherwise expressly provided in this Agreement or
such Loan Document) not to constitute, senior indebtedness under the
subordination provisions of any subordinated Indebtedness, or any such
subordination provisions shall be invalidated or otherwise cease to be a
legal, valid and binding obligation of the parties thereto, enforceable in
accordance with its terms; or
(q) an Event of Failure under Section 2.13(b) has occurred;
then, and in every such event (other than an event with respect to either
Borrower described in paragraph (g) or (h) above), and at any time thereafter
during the continuance of such event, the Administrative Agent may and, at the
request of the Required Lenders, shall, by notice to the Borrowers, take any of
or all the following actions, at the same or different times: (i) terminate
forthwith the Commitments, (ii) declare the Loans then outstanding to be
forthwith due and payable in whole or in part, whereupon the principal of the
Loans so declared to be due and payable, together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Loan Parties
accrued hereunder and under any other Loan Document, shall become forthwith due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by each Borrower, anything
contained herein or in any other Loan Document to the contrary notwithstanding
and (iii) exercise any remedies available under any Loan Document or otherwise;
and in any event with respect to either Borrower described in paragraph (g) or
(h) above, the Commitments shall automatically terminate and the principal of
the Loans then outstanding, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Loan Parties accrued
hereunder and under any other Loan Document, shall automatically become due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by each Borrower, anything contained
herein or in any other Loan Document to the contrary notwithstanding.
ARTICLE IX
The Agents, the Administrative Agents and the Facing Agent
In order to expedite the transactions contemplated by this Agreement, (a)
each of The Chase Manhattan Bank and Bankers Trust Company is hereby appointed
to act as Agent on behalf of the Facing Agent and the Lenders, (b) Bankers Trust
Company is hereby appointed to act as Administrative Agent and Collateral Agent
for the Facing Agent and the Lenders and (c) Deutsche Bank Canada is hereby
appointed to act as Canadian Administrative Agent for the Facing Agent and the
Revolving Lenders (the Agents, the Administrative Agent, the Collateral Agent
and the Canadian Administrative Agent for purposes of this Article IX are
collectively referred to as the "Agents"). Each of the Lenders and the Facing
Agent hereby irrevocably authorizes each Agent to take such actions on its
behalf and to exercise such powers as are specifically delegated to such Agent
by the terms and provisions hereof and of the other Loan Documents, together
with such actions and powers as are reasonably incidental thereto. Each of the
Agents is expressly authorized by the Lenders and the Facing Agent, without
limiting any implied authority, to receive all Loan Documents on the Closing
Date. The Administrative Agent is expressly authorized by the Lenders and the
Facing Agent, without limiting any implied authority, (a) to receive on behalf
of the Lenders and the Facing Agent all payments of principal of and interest on
the Loans, all payments in respect of LC Disbursements and all other amounts due
to the Lenders and the Facing Agent hereunder, and promptly to distribute to
each Lender and the Facing Agent its proper share of each payment so received,
(b) to give notice on behalf of each of the Lenders to the Borrowers of any
Event of
92
87
Default specified in this Agreement of which the Administrative Agent
has actual knowledge acquired in connection with its agency hereunder and (c) to
distribute to each Lender and the Facing Agent copies of all notices, financial
statements and other materials delivered by the Loan Parties pursuant to this
Agreement as received by the Administrative Agent (including notices of an
occurrence of any Event of Default). BTCo, as Collateral Agent, is expressly
authorized to execute any and all documents (including releases) with respect to
the Collateral and the Program Receivables and the rights of the Lenders with
respect thereto and to act as Collateral Agent on behalf of the Lenders, in each
case as contemplated by and in accordance with the terms and provisions of this
Agreement and the Security Documents, including the right to be the sole
bondholder of the Bonds and to hold them as pledgee for the benefit of the
Tranche H Lenders, the Revolving Lenders, the Agents, and the Facing Agent.
For greater certainty and without limiting the powers of the Collateral
Agent herein and for purposes of constituting security on any of the Collateral,
present or future, of any of Canco or any of its Subsidiaries located or deemed
located in the Province of Quebec, as security for the due payment of the Bonds,
Canco and its Subsidiaries, the Tranche H Lenders, the Revolving Lenders, the
Agents and the Facing Agent hereby acknowledge and agree that the Trustee is,
for the purposes of holding any security granted by any of Canco or any of its
Subsidiaries pursuant to the laws of the Province of Quebec, the holder of an
irrevocable power of attorney for all present and future Bondholders. By the
execution of any Assignment and Acceptance, any future Tranche H Lender or
Revolving Lender shall be deemed to ratify the power of attorney granted to the
Trustee hereunder. Furthermore, the Collateral Agent hereby agrees to act in the
capacity of the collateral agent and depositary of the Bonds for the benefit of
all present and future Tranche H Lenders, Revolving Lenders, Agents and Facing
Agent. Any future Tranche H Lenders or Revolving Lenders shall be deemed to
reconfirm the above mandate of the Collateral Agent. Canco and its Subsidiaries,
the Agent, the Facing Agent, the Tranche H Lenders and the Revolving Lenders
agree that (a) notwithstanding the provisions of Section 32 of the ACT
RESPECTING SPECIAL POWERS OF LEGAL PERSONS (Quebec), the Trustee may acquire any
title or indebtedness secured by the Hypothecs, and that (b) the Bonds
constitute "titles of indebtedness" within the meaning of such term in Article
2692 of the CIVIL CODE OF QUEBEC.
None of the Agents or the Facing Agent or any of their respective
directors, officers, employees or agents shall be liable as such for any action
taken or omitted by any of them except for its, his or her own gross negligence
or wilful misconduct, or be responsible for any statement, warranty or
representation herein or the contents of any document delivered in connection
herewith, or be required to ascertain or to make any inquiry concerning the
performance or observance by the Loan Parties of any of the terms, conditions,
covenants or agreements contained in any Loan Document. None of the Agents shall
be responsible to the Lenders or the Facing Agent for the due execution,
genuineness, validity, enforceability or effectiveness of this Agreement, any
other Loan Document or any other instruments or agreements. Each Agent shall in
all cases be fully protected in acting, or refraining from acting, in accordance
with written instructions signed by the Required Lenders (and the Facing Agent,
with respect to Letters of Credit) and, except as otherwise specifically
provided herein, such instructions and any action or inaction pursuant thereto
shall be binding on all the Lenders and the Facing Agent. Each Agent shall, in
the absence of knowledge to the contrary, be entitled to rely on any instrument
or document believed by them in good faith to be genuine and correct and to have
been signed or sent by the proper Person or Persons. None of the Agents or the
Facing Agent or any of their respective directors, officers, employees or agents
shall have any responsibility to the Loan Parties on account of the failure of
or delay in performance or breach by any Lender (or, in the case of the Agents,
by the Facing Agent) of any of its obligations hereunder or to any Lender (or,
in the case of the Agents, the
93
88
Facing Agent) on account of the failure of or delay in performance or breach by
any other Lender (or, in the case of the Agents, the Facing Agent) or the Loan
Parties or any Guarantor of any of their respective obligations hereunder or
under any other Loan Document or in connection herewith or therewith. Each Agent
and the Facing Agent may execute any and all duties hereunder by or through
agents or employees and shall be entitled to rely upon the advice of legal
counsel selected by any of them with respect to all matters arising hereunder
and shall not be liable for any action taken or suffered in good faith by any of
them in accordance with the advice of such counsel.
The Lenders and the Facing Agent hereby acknowledge that none of the Agents
or the Facing Agent shall be under any duty to take any discretionary action
permitted to be taken by it pursuant to the provisions of this Agreement unless
it shall be requested in writing to do so by the Required Lenders.
Subject to the appointment and acceptance of a successor Agent as provided
below, any Agent may resign at any time by notifying the other Agents, the
Lenders, the Facing Agent and the Borrowers. Upon any such resignation, the
Required Lenders (or, in the case of the resignation of the Canadian
Administrative Agent, a majority in interest of the Revolving Lenders) shall
have the right to appoint a Lender as the successor. If no successor shall have
been so appointed by the Required Lenders or the Revolving Lenders, as the case
may be, and shall have accepted such appointment within 30 days after the
retiring Agent gives notice of its resignation, then the retiring Agent may, on
behalf of the Lenders and the Facing Agent, appoint a successor Agent, which
shall be a bank with an office in New York, New York (or, in the case of the
Canadian Administrative Agent, Toronto, Ontario), having a combined capital and
surplus of at least U.S.$500,000,000 or an Affiliate of any such bank. Upon the
acceptance of any appointment as Agent hereunder by a successor bank, such
successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent and the retiring Agent shall be
discharged from its duties and obligations hereunder. After any Agent's
resignation hereunder, the provisions of this Article IX and Section 11.05 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Agent.
With respect to the Loans made by it hereunder, each Agent and the Facing
Agent, in its individual capacity and not as Agent or Facing Agent, as the case
may be, shall have the same rights and powers as any other Lender and may
exercise the same as though it were not an Agent or the Facing Agent, as the
case may be, and each Agent and its Affiliates and the Facing Agent and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with the Loan Parties or any of their respective Subsidiaries
or other Affiliates as if it were not an Agent or the Facing Agent, as the case
may be.
Each Lender agrees (a) to reimburse each Agent and the Facing Agent, on
demand, in the amount of such Lender's pro rata share (based on its Commitments
hereunder (provided that (x) in the case of the Tranche G Loans or Tranche H
Loans or (y) in the event that such Commitments shall have expired or been
terminated, such pro rata share shall be based on the respective principal
amounts of the outstanding Loans)) of any expenses incurred for the benefit of
the Lenders by such Agent or the Facing Agent, including fees, disbursements and
other charges of counsel and compensation of agents paid for services rendered
on behalf of the Lenders, that shall not have been reimbursed by the Loan
Parties and (b) to indemnify and hold harmless each Agent and the Facing Agent
and any of their respective directors, officers, employees or agents, on demand,
in the amount of such pro rata share, from and against any and all liabilities,
taxes, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by or asserted against it in its capacity as an Agent or
the Facing Agent, as the case may be, or any of them in any way relating to or
arising out of this Agreement or any other Loan Document or any action taken or
omitted by it or any of them under
94
89
this Agreement or any other Loan Document, to the extent the same shall not have
been reimbursed by the Loan Parties; provided, however, that (i) no Lender shall
be liable to any Agent or the Facing Agent for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence or wilful
misconduct of such Agent or the Facing Agent, as the case may be, or any of
their respective directors, officers, employees or agents and (ii) each Lender
that does not have a Revolving Credit Commitment (other than through the
expiration or termination thereof) shall be under no obligation to reimburse or
indemnify the Facing Agent under clauses (a) and (b) above.
Each Lender acknowledges that it has, independently and without reliance
upon any Agent, any other Lender or the Facing Agent 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 Lender also acknowledges that it
will, independently and without reliance upon any Agent, any other Lender or the
Facing Agent based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement or any other Loan Document, any
related agreement or any document furnished hereunder or thereunder.
ARTICLE X
Collection Allocation Mechanism
SECTION 10.01. Implementation OF CAM. (a) On the CAM Exchange Date, the
Lenders shall automatically and without further act (and without regard to the
provisions of Section 11.04) be deemed to have exchanged interests in the Credit
Facilities such that in lieu of the interest of each Lender in each Credit
Facility in which it shall participate as of such date (including such Lender's
interest in the Designated Obligations of each Loan Party in respect of each
such Credit Facility), such Lender shall hold an interest in every one of the
Credit Facilities (including the Designated Obligations of each Loan Party in
respect of each such Credit Facility and each LC Reserve Account established
pursuant to Section 10.02 below), whether or not such Lender shall previously
have participated therein, equal to such Lender's CAM Percentage thereof. Each
Lender and each Borrower hereby consents and agrees to the CAM Exchange, and
each Lender agrees that the CAM Exchange shall be binding upon its successors
and assigns and any person that acquires a participation in its interests in any
Credit Facility. Each Borrower agrees from time to time to execute and deliver
to the Agents all instruments and documents as either Agent shall reasonably
request to evidence and confirm the respective interests of the Lenders after
giving effect to the CAM Exchange.
(b) As a result of the CAM Exchange, upon and after the CAM Exchange Date,
each payment received by the Administrative Agent or the Collateral Agent
pursuant to any Loan Document in respect of the Designated Obligations, and each
distribution made by the Collateral Agent pursuant to any Security Document in
respect of the Designated Obligations, shall be distributed to the Lenders pro
rata in accordance with their respective CAM Percentages. Any direct payment
received by a Lender upon or after the CAM Exchange Date, including by way of
setoff, in respect of a Designated Obligation shall be paid over to the
Administrative Agent for distribution to the Lenders in accordance herewith.
SECTION 10.02. Letters of Credit. (a) In the event that on the CAM Exchange
Date any Letter of Credit shall be outstanding and undrawn in whole or in part,
or any amount drawn under a Letter of Credit shall not have been reimbursed
either by Canco or with the proceeds of a
95
90
Revolving Credit Borrowing, each Revolving Lender shall promptly pay over to the
Administrative Agent, in immediately available funds in the same currency as
such Letter of Credit, in the case of any undrawn amount, and in U.S. Dollars,
in the case of any unreimbursed amount, an amount equal to such Revolving
Lender's Applicable Percentage of such undrawn face amount or (to the extent it
has not already done so) such unreimbursed drawing, as the case may be, together
with interest thereon from the CAM Exchange Date to the date on which such
amount shall be paid to the Administrative Agent at the rate that would be
applicable at the time to an ABR Revolving Loan or Canadian Prime Rate Loan, as
the case may be, in a principal amount equal to such amount. The Administrative
Agent shall establish a separate account or accounts for each Lender (each, an
"LC Reserve Account") for the amounts received with respect to each such Letter
of Credit pursuant to the preceding sentence. The Administrative Agent shall
deposit in each Lender's LC Reserve Account such Lender's CAM Percentage of the
amounts received from the Revolving Lenders as provided above. The
Administrative Agent shall have sole dominion and control over each LC Reserve
Account, and the amounts deposited in each LC Reserve Account shall be held in
such L/C Reserve Account until withdrawn as provided in paragraph (b), (c), (d)
or (e) below. The Administrative Agent shall maintain records enabling it to
determine the amounts paid over to it and deposited in the LC Reserve Accounts
in respect of each Letter of Credit and the amounts on deposit in respect of
each Letter of Credit attributable to each Lender's CAM Percentage. The amounts
held in each Lender's LC Reserve Account shall be held as a reserve against the
outstanding L/C Exposure, shall be the property of such Lender, shall not
constitute Loans to or give rise to any claim of or against any Loan Party and
shall not give rise to any obligation on the part of either Borrower to pay
interest to such Lender, it being agreed that the reimbursement obligations in
respect of Letters of Credit shall arise only at such times as drawings are made
thereunder, as provided in Article III.
(b) In the event that after the CAM Exchange Date any drawing shall be made
in respect of a Letter of Credit, the Administrative Agent shall, at the request
of the Facing Agent, withdraw from the LC Reserve Account of each Lender any
amounts, up to the amount of such Lender's CAM Percentage of such drawing,
deposited in respect of such Letter of Credit and remaining on deposit and
deliver such amounts to the Facing Agent in satisfaction of the reimbursement
obligations of the Revolving Lenders under subsection (c) of Article III (but
not of Canco under subsection (d) of Article III). In the event any Revolving
Lender shall default on its obligation to pay over any amount to the
Administrative Agent in respect of any Letter of Credit as provided in this
Section 10.02, the Facing Agent shall, in the event of a drawing thereunder,
have a claim against such Revolving Lender to the same extent as if such Lender
had defaulted on its obligations under subsection (c) of Article III, but shall
have no claim against any other Lender in respect of such defaulted amount,
notwithstanding the exchange of interests in Canco's reimbursement obligations
pursuant Section 10.01. Each other Lender shall have a claim against such
defaulting Revolving Lender for any damages sustained by it as a result of such
default, including, in the event such Letter of Credit shall expire undrawn, its
CAM Percentage of the defaulted amount.
(c) In the event that after the CAM Exchange Date any Letter of Credit
shall expire undrawn, the Administrative Agent shall withdraw from the LC
Reserve Account of each Lender the amount remaining on deposit therein in
respect of such Letter of Credit and distribute such amount to such Lender.
(d) With the prior written approval of the Administrative Agent and the
Facing Agent (not to be unreasonably withheld), any Lender may withdraw the
amount held in its LC Reserve Account in respect of the undrawn amount of any
Letter of Credit. Any Lender making such a withdrawal shall be unconditionally
obligated, in the event there shall subsequently be a drawing under such
96
91
Letter of Credit, to pay over to the Administrative Agent, for the account of
the Facing Agent, on demand, its CAM Percentage of such drawing.
(e) Pending the withdrawal by any Lender of any amounts from its LC Reserve
Account as contemplated by the above paragraphs, the Administrative Agent will,
at the direction of such Lender and subject to such rules as the Administrative
Agent may prescribe for the avoidance of inconvenience, invest such amounts in
Permitted Investments. Each Lender which has not withdrawn its CAM Percentage of
amounts in its LC Reserve Account as provided in paragraph (d) above shall have
the right, at intervals reasonably specified by the Administrative Agent, to
withdraw the earnings on investments so made by the Administrative Agent with
amounts in its LC Reserve Account and to retain such earnings for its own
account.
SECTION 10.03. Conversion. In the event the CAM Exchange Date shall occur,
Obligations owed by the Loan Parties denominated in any currency other than U.S.
Dollars (other than, for the avoidance of doubt, obligations in respect of
undrawn Letters of Credit denominated in Canadian Dollars) shall, automatically
and with no further act required, be converted to obligations of the same Loan
Parties denominated in U.S. Dollars. Such conversion shall be effected based
upon the Exchange Rates in effect with respect to the relevant currencies on the
CAM Exchange Date. On and after any such conversion, all amounts accruing and
owed to any Lender in respect of its Obligations shall accrue and be payable in
U.S. Dollars at the rates otherwise applicable hereunder (and, in the case of
interest on Loans, at the default rate applicable to ABR Loans hereunder).
Notwithstanding the foregoing provisions of this Section 10.03, any Lender may,
by notice to the Borrowers and the Administrative Agent prior to the CAM
Exchange Date, elect not to have the provisions of this Section 10.03 apply with
respect to all Obligations owed to such Lender immediately following the CAM
Exchange Date, and, if such notice is given, all Obligations owed to such Lender
immediately following the CAM Exchange Date shall remain designated in their
original currencies.
ARTICLE XI
Miscellaneous
SECTION 11.01. Notices. Except as otherwise expressly permitted herein,
notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed or sent by
telecopy, as follows:
(a) if to Stone or Canco, to it at 0000 Xxxxxxxx Xxxxxx, Xx. Xxxxx, XX
00000, Attention of Treasurer (Telecopy No. (000) 000-0000);
(b) if to Chase, as Lender or Agent, to it at 00 Xxxxx XxXxxxx Xxxxxx
(00xx Xxxxx), Xxxxxxx, XX 00000-0000, Attention of Xxxxxxxx Xxxxxxxx
(Telecopy No. (000) 000-0000);
(c) if to BTCo, as Lender, Agent or Administrative Agent, to it at 000
Xxxxx Xxxxxx Xxxxx (00xx Xxxxx), Xxxxxxx, XX 00000, Attention of Xxxxxxx
Xxxxxxx and Xxxxxx Xxxxx (Telecopy No. (000) 000-0000);
(d) if to Deutsche Bank Canada, as Lender, Canadian Administrative
Agent or Facing Agent, to it at 000 Xxx Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxx, Xxxxxx X0X 0X0, Attention of Xxxxx Xxxxxx (Telecopy No. (416)
682-8444); and
97
92
(e) if to any other Lender, at its address (or telecopy number) set
forth on Schedule 2.01 or in the Assignment and Acceptance pursuant to
which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy, or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 11.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 11.01. The Administrative Agent shall deliver to the Borrower and Chase,
as Agent, a copy of each Administrative Questionnaire received by it.
SECTION 11.02. Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrowers herein and by the Loan
Parties in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the Lenders and the Facing Agent and
shall survive the making by the Lenders of the Loans and the issuance of Letters
of Credit by the Facing Agent, regardless of any investigation made by the
Lenders or the Facing Agent or on their behalf, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any Fee or any other amount payable under this Agreement or any other Loan
Document is outstanding and unpaid or any Letter of Credit is outstanding and so
long as the Commitments have not been terminated.
SECTION 11.03. Binding Effect. This Agreement shall become effective when
it shall have been executed by the Borrowers and the Agents and when the
Administrative Agent shall have received copies hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the Borrowers, the
Agents, the Administrative Agent, the Facing Agent and the Lenders and their
respective successors and assigns, except that neither Borrower shall have the
right to assign its rights or duties hereunder or any interest herein without
the prior consent of all the Lenders, and any attempted assignment by any such
Person shall be void (it being understood that a merger of either Borrower into
or with any other Person in which the other Person is the surviving entity shall
not be considered an assignment of such Borrower's duties hereunder and would
instead be subject to the restrictions of Section 7.05).
SECTION 11.04. Successors and Assigns. (a) Subject to Section 11.03,
whenever in this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party,
and all covenants, promises and agreements by or on behalf of the Borrowers, the
Agents, the Administrative Agent, the Facing Agent or the Lenders that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.
(b) Each Lender may assign to one or more assignees (treating "Related
Funds," as defined below, as a single assignee), including an Affiliate thereof,
all or a portion of its interests, rights and/or obligations under this
Agreement (including all or a portion of its Commitments, the outstanding
Letters of Credit and the Loans at the time owing to it); provided, however,
that (i) except in the case of an assignment to any other Lender, an Affiliate
of any other Lender or, in the case of any Lender that is a fund that invests in
bank loans, any other fund that invests in bank loans and is managed or advised
by the same investment advisor or by an Affiliate of such investment advisor,
each of the Administrative Agent and Stone (and, in the case of an assignment
98
93
of a Lender's Revolving Credit Commitment, the Facing Agent) must give its prior
written consent to such assignment (which consent shall not be unreasonably
withheld), provided that (x) Stone shall be deemed to have consented to any
assignment of Tranche G Loans or Tranche H loans made within 15 Business Days
after the Closing Date as part of the primary syndication of such Loans in
accordance with, and to accomplish in whole or in part, the allocations thereof
to the financial institutions and other persons previously agreed upon in
writing by Stone and the Agents and (y) the consent of Stone shall not be
required if a Default or an Event of Default under paragraph (b), (c), (g) or
(h) of Article VIII has occurred and is continuing on the date of the Assignment
and Acceptance, (ii) the Administrative Agent will give notice to the other
Agent promptly, and in any case within one week, of any assignment (including an
assignment to a Lender or an Affiliate of a Lender), provided that the failure
of the Administrative Agent to give notice to the other Agent of any such
assignment shall not affect the validity of such assignment, (iii) except in the
case of an assignment to any other Lender, an Affiliate of any other Lender or,
in the case of any Lender that is a fund that invests in bank loans, any other
fund that invests in bank loans and is managed or advised by the same investment
advisor of any such other Lender or an Affiliate of such investment advisor (a
"Related Fund"), the amount of the Commitments and Loans of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the Administrative
Agent) shall not be less than U.S.$1,000,000 (or an amount equal to the
remaining balance of any of such Lender's Commitments and Loans), (iv) the
parties to each such assignment shall execute and deliver to the Administrative
Agent an Assignment and Acceptance, and a processing and recordation fee of
U.S.$3,500 and (v) the assignee, if it shall not be a Lender, shall deliver to
the Administrative Agent an Administrative Questionnaire, provided further that,
notwithstanding the foregoing, the sale or assignment by any assignor (which
acquired an interest in the Commitments and Loans of a Lender in an amount less
than U.S.$1,000,000 pursuant to an exception to clause (iii) of the immediately
preceding proviso) to any Person who is not a Lender, an Affiliate of any other
Lender, or a Related Fund of any Lender shall be subjected to the minimum
assignment requirement of U.S.$1,000,000 if all the Affiliates of such Lender
have interests in Commitments and Loans in the aggregate of U.S.$1,000,000 or
more. Upon acceptance and recording pursuant to Section 11.04(e), from and after
the effective date specified in each Assignment and Acceptance, (i) the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, shall have the rights and obligations of a
Lender under this Agreement and (ii) the assigning Lender thereunder shall, to
the extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto, but shall continue to be entitled to the benefits of Sections
2.14, 2.16, 2.20 and 11.05, as well as to any Fees accrued for its account and
not yet paid).
(c) By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that its
Commitments, and the outstanding balances of its Loans, in each case without
giving effect to assignments thereof that have not become effective, are as set
forth in such Assignment and Acceptance; (ii) except as set forth in clause (i)
above, such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto, or the financial condition of the Loan Parties or the performance or
observance by the Loan Parties of any of their obligations under this
99
94
Agreement or under any other Loan Document or any other instrument or document
furnished pursuant hereto; (iii) such assignee represents and warrants that it
is legally authorized to enter into such Assignment and Acceptance; (iv) such
assignee confirms that it has received a copy of this Agreement, together with
copies of any amendments or consents entered into prior to the date of such
Assignment and Acceptance and copies of the most recent financial statements
delivered pursuant to Section 6.04 and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (v) such assignee will independently and
without reliance upon any Agent, the Administrative Agent, the Facing Agent,
such assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (vi) such
assignee appoints and authorizes each of the Agents, the Administrative Agent
and the Facing Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to such Agent, the
Administrative Agent and the Facing Agent by the terms hereof, together with
such powers as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all the obligations that by
the terms of this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent, acting for this purpose as agent of the
Borrowers, shall maintain at one of its offices in The City of New York a copy
of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
conclusive in the absence of manifest error and the Borrowers, the Agents, the
Administrative Agent, the Facing Agent and the Lenders shall treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrowers, any
Agent, the Facing Agent and any Lender, at any reasonable time and from time to
time upon reasonable prior notice.
(e) Upon its receipt of a duly completed Assignment and Acceptance executed
by an assigning Lender and an assignee, together with an Administrative
Questionnaire completed in respect of the assignee (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) above and the written consent (to the extent required under
paragraph (b) above), of the Administrative Agent, the Borrowers and the Facing
Agent to such assignment, the Administrative Agent shall (i) accept such
Assignment and Acceptance and (ii) record the information contained therein in
the Register. No assignment shall be effective unless it has been recorded in
the Register as provided in this paragraph (e).
(f) Each Lender may, without the consent of either Borrower, either Agent
or the Facing Agent, sell participations to one or more banks or other entities
in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the participating
banks or other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.14, 2.16, 2.20 and 11.05 to the same extent
as if they were Lenders, provided that, except as expressly provided in Section
2.20(a), the Borrowers shall not be required to reimburse the participating
lenders or other entities pursuant to Section 2.14, 2.16, 2.20 or 11.05 in an
amount in excess of the amount that would have been payable thereunder to such
Lender had such Lender not sold such participation, and (iv) the Borrowers, the
Agents, the Administrative Agent, the Facing Agent and the other Lenders shall
100
95
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Loan Parties under the
Loan Documents and to approve any amendment, modification or waiver of any
provision of this Agreement (provided that the participating bank or other
entity may be provided with the right to approve amendments, modifications or
waivers affecting it with respect to (w) any decrease in the Fees payable
hereunder with respect to Loans in which the participating bank or other entity
has purchased a participation, (x) any change in the amount of principal of, or
decrease in the rate at which interest is payable on, the Loans in which the
participating bank or other entity has purchased a participation, (y) any
extension of the final scheduled maturity of any Loan in which the participating
bank or other entity has purchased a participation or (z) any release of a
Borrower or any Guarantor (except as expressly contemplated by any Loan
Document) or all or any substantial part of the Collateral (except as expressly
contemplated by any Loan Document).
(g) Notwithstanding the limitations set forth in paragraph (b) above, (i)
any Lender may at any time assign all or any portion of its rights under this
Agreement to a Federal Reserve Bank without the prior written consent of either
Borrower, either Agent or the Facing Agent and (ii) any Lender which is a fund
may pledge all or any portion of its rights under this Agreement (A) to its
trustee in support of its obligations to its trustee or (B) in connection with
any securitization of any portfolio loans of such Lender, in each case without
the prior written consent of either Borrower, either Agent or the Facing Agent,
provided that no such assignment pursuant to clause (i) or (ii) shall release a
Lender from any of its obligations hereunder or substitute any such Bank,
trustee or assignee for such Lender as a party hereto.
(h) Except as provided in Article III the Facing Agent may not assign or
delegate any of its respective rights and duties hereunder without the prior
written consent of Canco, each Agent and the Administrative Agent.
SECTION 11.05. Expenses; Indemnity. (a) The Borrowers agree, jointly and
severally, to pay all out-of-pocket expenses incurred by the Agents, the
Administrative Agent and the Facing Agent in connection with the preparation of
this Agreement and the other Loan Documents (including all costs relating to due
diligence) or in connection with any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions hereby
contemplated shall be consummated) or incurred by the Agents, the Administrative
Agent, the Facing Agent or any Lender in connection with the enforcement or
protection of their rights in connection with this Agreement and the other Loan
Documents or in connection with the Loans made or the Letters of Credit issued
hereunder, including the reasonable fees, disbursements and other charges of
Cravath, Swaine & Moore, Blake, Xxxxxxx & Xxxxxxx LLP and Xxxxxxxxxx Xxxxxxxx
Xxxxx Xxxxxx, counsel for Chase and BTCo, and, in connection with any such
enforcement or protection, the reasonable fees, disbursements and other charges
of any other counsel (including allocated costs of internal counsel) for the
Agents, the Administrative Agent, the Canadian Administrative Agent, the
Collateral Agent, the Facing Agent or any Lender. The Borrowers further agree to
indemnify the Agents, the Administrative Agent, the Facing Agent and the Lenders
from, and hold them harmless against, any documentary taxes, assessments or
similar charges made by any Governmental Authority by reason of the execution
and delivery of this Agreement or any of the other Loan Documents.
(b) The Borrowers agree, jointly and severally, to indemnify each Agent,
the Arrangers, the Syndication Agent, the Facing Agent and each Lender and each
of their respective directors, officers, employees and agents (each such person
being called an "Indemnitee") against, and to hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses,
101
96
including reasonable counsel fees, disbursements and other charges, incurred by
or asserted against any Indemnitee arising out of, in any way connected with, or
as a result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto or thereto of their respective obligations
hereunder or thereunder or the consummation of the Transactions and the other
transactions contemplated hereby or thereby, (ii) the use of the Letters of
Credit or the proceeds of the Loans, (iii) any claim, litigation, investigation
or proceeding relating to any of the foregoing, whether or not any Indemnitee is
a party thereto or (iv) any actual or alleged presence or release of Hazardous
Materials on or from any property currently or formerly owned or operated by
either Borrower or any of the Subsidiaries or any of their respective
predecessors or any liability under any Environmental Law related in any way to
either Borrower or any of the Subsidiaries, provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses have resulted from the gross negligence
or wilful misconduct of such Indemnitee.
(c) The provisions of this Section 11.05 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the invalidity or unenforceability of any term or provision of this
Agreement or any other Loan Document, or any investigation made by or on behalf
of the Agents, the Administrative Agent, the Facing Agent or any Lender. All
amounts due under this Section 11.05 shall be payable on written demand
therefor.
SECTION 11.06. Right of Setoff. If an Event of Default shall have occurred
and be continuing, each Lender is hereby authorized, in addition to any other
right or remedy that any Lender may have by operation of law or otherwise, at
any time and from time to time, without notice to either Borrower (any such
notice being expressly waived by each Borrower), to exercise its banker's lien
or right of setoff and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other Indebtedness at any
time owing by such Lender to or for the credit or the account of any Loan Party
against any of and all the obligations of the Borrowers now or hereafter
existing under this Agreement and other Loan Documents held by such Lender,
irrespective of whether such Lender shall have made any demand under this
Agreement or such other Loan Document and although such obligations may be
unmatured.
SECTION 11.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(OTHER THAN THE MORTGAGES, THE CANADIAN SECURITY AGREEMENTS, THE HYPOTHECS AND
THE CANADIAN PLEDGE AGREEMENTS) SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTIONS 5-1401
AND 5-1402 OF TITLE 14 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT EXCLUDING ALL
OTHER CHOICE OF LAW AND CONFLICTS OF LAWS RULES THEREOF.
SECTION 11.08. Waivers; Amendment. (a) No failure or delay on the part of
any Agent, the Administrative Agent, the Facing Agent or any Lender in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuation of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Agents, the Administrative Agent,
the Facing Agent and the Lenders hereunder and under the other Loan Documents
are cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Loan Parties therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) below,
and then such waiver or consent shall
102
97
be effective only in the specific instance and for the purpose for which given.
No notice or demand on the Loan Parties in any case shall entitle the Loan
Parties to any other or further notice or demand in similar or other
circumstances.
(b) Neither this Agreement or any of the other Loan Documents nor any
provision hereof or thereof may be waived, amended or modified except (i) in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by each Borrower and the Required Lenders and (ii) in the case of
any other Loan Document, pursuant to an agreement or agreements entered into by
the parties to such Loan Document, in each case with the consent of the Required
Lenders; provided, however, that no such agreement shall (i) decrease the
principal amount of, or extend the final scheduled maturity of or date for the
payment of any interest on any Loan, or waive or excuse any such payment or any
part thereof, or decrease the rate of interest on any Loan, without the prior
written consent of each Lender affected thereby, (ii) increase the amount of or
extend the termination date of the Commitment or decrease or extend the date for
payment of any Fee owing to any Lender without the prior written consent of such
Lender, (iii) amend or modify the pro rata sharing provisions of Section 2.17 or
the provisions of Section 11.03 concerning the assignment of either Borrower's
obligations hereunder, the provisions of this Section 11.08, the percentage in
the definition of the term "Required Lenders" or the percentage in the
definition of the term "Majority Vote" or release either Borrower or any
Guarantor (except as expressly contemplated by any Loan Document) or all or
substantially all of the Collateral (except as expressly contemplated by any
Loan Document), without the prior written consent of each Lender, (iv) with
respect to the Term Loans, modify the pro rata sharing requirements of Section
2.13(f), change the application of any prepayments or scheduled repayments of
the Term Loans, reduce the amount of or waive any prepayments or scheduled
repayments of the Term Loans or extend the time of payment for prepayments or
scheduled repayments of Term Loans without a Majority Vote, by Class, of the
Lenders holding Loans adversely affected thereby (other than any such agreement
that merely adds an additional tranche of Term Loans entitled to the benefits of
such pro rata provisions) or (v) reduce the amount of or waive any prepayments
of the Revolving Loans or extend the time of payment for prepayments of
Revolving Loans without a Majority Vote of the Revolving Lenders; provided,
further, however, that no such agreement shall amend, modify or otherwise affect
the rights or duties of any Agent, the Administrative Agent or the Facing Agent
hereunder or under any other Loan Document without the prior written consent of
such Agent, the Administrative Agent or the Facing Agent, as the case may be.
(c) Without the consent of Existing Stone Lenders holding more than 50% of
the sum of (i) outstanding loans under the Existing Stone Credit Agreement, (ii)
unused commitments in respect thereof and (iii) letter of credit exposure under
the Existing Stone Credit Agreement, the Borrowers and the Lenders shall not
enter into, consent to or approve of any amendment, modification or waiver of
any provision of this Agreement or any other Loan Document if, as a result of
such amendment, waiver or modification, the Existing Stone Lenders would no
longer be entitled to the pro rata sharing requirements of Section 2.23, and any
such attempted amendment, modification or waiver shall be null and void. Each
Existing Stone Lender shall be entitled to enforce the provisions of this
Section 11.08(c).
SECTION 11.09. Release of Collateral. Each Lender hereby directs BTCo, as
Collateral Agent, to release, or to cause the Trustee to release, any Lien held
by it under the Security Documents under the following circumstances:
(a) upon final and indefeasible payment in full in cash of the Loans
and Obligations (other than unasserted contingent and indemnification
obligations which expressly survive termination) and termination of all
Commitments and termination hereof, BTCo, as
103
98
Collateral Agent, is authorized to release, or to cause the Trustee to
release, all of the Liens created under the Loan Documents;
(b) upon any sale or other disposition of Collateral permitted
hereunder, BTCo, as Collateral Agent, is authorized to release, or to cause
the Trustee to release, such Liens that relate solely to the Collateral
sold or otherwise disposed; and
(c) upon consent by the Required Lenders, BTCo, as Collateral Agent,
is authorized to release, or to cause the Trustee to release, such Liens on
any part of the Collateral which release does not require the consent of
all of the Lenders as set forth in Section 11.08;
provided, however, that (i) the Collateral Agent shall not be required to
execute any such document on terms which, in its opinion, would expose it to
liability or create any obligation or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Obligations or any Liens upon
(or obligations of either Borrower or any of the Subsidiaries in respect of) all
interests retained by the Borrowers or any of the Subsidiaries.
SECTION 11.10. Interest Rate Limitation. Notwithstanding anything herein to
the contrary, if at any time the applicable interest rate, together with all
fees and charges that are treated as interest under applicable law
(collectively, the "Charges"), as provided for herein or in any other document
executed in connection herewith, or otherwise contracted for, charged, received,
taken or reserved by any Lender, shall exceed the maximum lawful rate (the
"Maximum Rate") that may be contracted for, charged, taken, received or reserved
by such Lender in accordance with applicable law, the rate of interest payable
to such Lender hereunder, together with all Charges payable to such Lender,
shall be limited to the Maximum Rate.
SECTION 11.11. Entire Agreement. This Agreement, the other Loan Documents
and any separate letter agreements with respect to fees payable to any Agent,
the Administrative Agent or the Facing Agent constitute the entire contract
between the parties relative to the subject matter hereof. Any previous
agreement among the parties with respect to the subject matter hereof is
superseded by this Agreement and the other Loan Documents. Nothing in this
Agreement or in the other Loan Documents, expressed or implied, is intended to
confer upon any party other than the parties hereto and thereto any rights,
remedies, obligations or liabilities under or by reason of this Agreement or the
other Loan Documents.
SECTION 11.12. Waiver of Jury Trial. Each party hereto hereby waives, to
the fullest extent permitted by applicable law, any right it may have to a trial
by jury in respect of any litigation directly or indirectly arising out of,
under or in connection with this Agreement or any of the other Loan Documents.
Each party hereto (a) certifies that no representative, agent or attorney of any
other party has represented, expressly or otherwise, that such other party would
not, in the event of litigation, seek to enforce the foregoing waiver and (b)
acknowledges that it and the other parties hereto have been induced to enter
into this Agreement and the other Loan Documents, as applicable, by, among other
things, the mutual waivers and certifications in this Section 11.12.
SECTION 11.13. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid
104
99
provisions, the economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.
SECTION 11.14. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.
SECTION 11.15. Confidentiality. (a) Each Lender agrees not to disclose to
any Person the Information (as defined below) in accordance with such Lender's
customary procedures for non-disclosure of confidential information of third
parties of this nature and in accordance with safe and sound lending practices
without the prior written consent of the Borrowers, which consent shall not be
unreasonably withheld, except that any Lender shall be permitted to disclose
Information (i) to its and its Affiliates' officers, directors, employees,
agents and representatives (including its auditors and counsel) or to any direct
or indirect contractual counterparty in swap agreements or such contractual
counterparty's professional advisor (so long as such contractual counterparty or
professional advisor to such contractual counterparty agrees in writing to be
bound by the provisions of this Section 11.15); (ii) to the extent (A) required
by applicable laws and regulations or by any subpoena or similar legal process
or (B) requested or required by any regulatory authority or The National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about a
Lender's investment portfolio; (iii) to the extent such Information (A) becomes
publicly available other than as a result of a breach of this Agreement, (B)
becomes available to such Lender on a non-confidential basis from a source other
than a Loan Party or its Affiliates or (C) was available to such Lender on a
non-confidential basis prior to its disclosure to such Lender by a Loan Party or
its Affiliates; (iv) to any actual or prospective assignee of, or prospective
purchaser of a participation in, the rights of such Lender hereunder, in each
case subject to paragraph (c) below; or (v) in connection with any suit, action
or proceeding relating to the enforcement of rights hereunder or under any other
Loan Document or in connection with the transactions contemplated hereby. As
used in this Section 11.15, as to any Lender, the term "Information" shall mean
the Confidential Information Memorandum and any other materials, documents and
information that either Borrower or any of its Affiliates may have furnished or
may hereafter furnish to any Lender in connection with this Agreement.
(b) Each Lender agrees that it will use the Information only for purposes
related to the transactions contemplated hereby and by the other Loan Documents,
provided that (i) if the conditions referred to in any of subclauses (A) through
(C) of clause (iii) of paragraph (a) above are met, such Lender may otherwise
use the Information and (ii) if such Lender or any of its Affiliates is
otherwise a creditor of a Loan Party, such Lender or any such Affiliate may use
the Information in connection with its other credits to such Loan Party.
(c) Each Lender agrees that it will not disclose any of the Information to
any actual or prospective assignee of such Lender or participant in any rights
of such Lender under this Agreement unless such actual or prospective assignee
or participant first executes and delivers to such Lender or the Borrowers a
confidentiality letter containing substantially the undertakings set forth in
this Section 11.15.
SECTION 11.16. Jurisdiction; Consent to Service of Process. (a) Each
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in
105
100
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such Federal court. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or the other Loan Documents against any
Loan Party or its properties in the courts of any jurisdiction.
(b) Each Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this agreement or the other Loan Documents in any
New York State or Federal court. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of process
in the manner provided for notices in Section 11.01. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.
SECTION 11.17. Judgment Currency. (a) Except as otherwise provided in
Section 10.03, the Borrowers' obligations hereunder and the Borrowers' and the
other Loan Parties' obligations under the other Loan Documents to make payments
in U.S. Dollars or in Canadian Dollars (the "Obligation Currency") shall not be
discharged or satisfied by any tender or recovery pursuant to any judgment
expressed in or converted into any currency other than the Obligation Currency,
except to the extent that such tender or recovery results in the effective
receipt by the applicable Administrative Agent, the Collateral Agent or a Lender
of the full amount of the Obligation Currency expressed to be payable to the
applicable Administrative Agent, the Collateral Agent or such Lender under this
Agreement or the other Loan Documents. If, for the purpose of obtaining or
enforcing judgment against either Borrower or any other Loan Party in any court
or in any jurisdiction, it becomes necessary to convert into or from any
currency other than the Obligation Currency (such other currency being
hereinafter referred to as the "Judgment Currency") an amount due in the
Obligation Currency, the conversion shall be made, at the Exchange Rate, in the
case of Canadian Dollars or U.S. Dollars, and, in the case of other currencies,
the rate of exchange (as quoted by the Administrative Agent or if the
Administrative Agent does not quote a rate of exchange on such currency, by a
known dealer in such currency designated by the Administrative Agent)
determined, in each case, as of the date immediately preceding the day on which
the judgment is given (such Business Day being hereinafter referred to as the
"Judgment Currency Conversion Date").
(b) If there is a change in the rate of exchange prevailing between the
Judgment Currency Conversion Date and the date of actual payment of the amount
due, the Borrowers covenant and agree to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount), as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the amount of any payment in the Obligation
Currency under this Section, the rate of exchange used shall take into account
any premium and costs payable in connection with the purchase of the Obligation
Currency.
106
101
SECTION 11.18. Certain Relationships. Nothing contained in this Agreement
and no action taken by any Agent, the Administrative Agent or any Lender
pursuant hereto shall be deemed to constitute the Agents, the Administrative
Agent or the Lenders a partnership, an association, a joint venture or other
entity. None of the Agents, the Administrative Agent or the Lenders has any
fiduciary relationship with or any fiduciary duty to either Borrower arising out
of or in connection with this Agreement or any of the other Loan Documents, and
the relationship between the Agents, the Administrative Agent and the Lenders,
on the one hand, and the Borrowers, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor.
107
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly
executed by their respective authorized officers or attorneys as of the day and
year first above written.
STONE CONTAINER CORPORATION,
by /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
ST LAURENT PAPERBOARD INC.,
by /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
BANKERS TRUST COMPANY,
individually, and as Administrative Agent
and Collateral Agent,
by /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Assistant Vice President
DEUTSCHE BANK CANADA, as
Canadian Administrative Agent and Facing
Agent,
by /s/ Xxxxx Xxxxxx
---------------------------------------
Name: Xxxxx Xxxxxx
Title: Credit Product Manager
by /s/ Xxxx X. Xxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Managing Director
THE CHASE MANHATTAN BANK,
individually, and as an Agent,
by /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
IIB BANK LIMITED
by /s/ Xxxx Xxxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxxx
Title: Director
by /s/ Xxxxxxxxx Xxxxx
---------------------------------------
Name: Xxxxxxxxx Xxxxx
Title: Associate Director
THE DAI-ICHI KANGYO BANK, LIMITED
by /s/ Naoki Yanamori
---------------------------------------
Name: Naoki Yanamori
Title: Senior Vice President
& Department Head
BANK OF CHINA
by /s/ Rubai Giu
---------------------------------------
Name: Rubai Giu
Title: President & CEO
THE CHASE MANHATTAN BANK OF CANADA
by /s/ Xxxxxxxxx Xxxx
---------------------------------------
Name: Xxxxxxxxx Xxxx
Title: Vice President
by /s/ Xxxxxx Xxxxx
---------------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
