$300,000,000
CREDIT AGREEMENT
Dated as of July 30, 1999
between
PRECISION CASTPARTS CORP.
and
BANK OF AMERICA, N.A.
TABLE OF CONTENTS
Section Page
ARTICLE I DEFINITIONS 1
Section 1.01 Certain Defined Terms 1
Section 1.02 Other Interpretive Provisions 20
Section 1.03 Accounting Principles 21
ARTICLE II THE CREDITS
Section 2.01 Amounts and Terms of Commitment 21
Section 2.02 Loan Accounts 22
Section 2.03 Procedure for Borrowing 22
Section 2.04 Conversion and Continuation Elections 23
Section 2.05 Voluntary Termination or Reduction
of Commitments 24
Section 2.06 Optional Prepayments 25
Section 2.07 Mandatory Prepayments of Loans;
Mandatory Commitment Reductions 25
Section 2.08 Repayment 26
Section 2.09 Interest 26
Section 2.10 Fees 27
Section 2.11 Computation of Fees and Interest 28
Section 2.12 Payments by the Company 29
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY
Section 3.01 Taxes 29
Section 3.02 Illegality 30
Section 3.03 Increased Costs and Reduction of Return 31
Section 3.04 Funding Losses 32
Section 3.05 Inability to Determine Rates 32
Section 3.06 Reserves on Offshore Rates Loans 33
Section 3.07 Certificates of Bank 33
Section 3.08 Survival 34
ARTICLE IV CONDITIONS PRECEDENT
Section 4.01 Conditions of Initial Loan 34
Section 4.02 Conditions to All Subsequent Loans 36
ARTICLE V REPRESENTATIONS AND WARRANTIES
Section 5.01 Corporate Existence and Power 37
Section 5.02 Corporate Authorization; No Contravention 38
Section 5.03 Governmental Authorization 38
Section 5.04 Binding Effect 38
Section 5.05 Litigation 39
Section 5.06 No Defaults 39
Section 5.07 ERISA Compliance 39
Section 5.08 Use of Proceeds; Margin Regulations 40
Section 5.09 Title to Properties; Liens 40
Section 5.10 Taxes 41
Section 5.11 Financial Condition 41
Section 5.12 Environmental Matters 42
Section 5.13 Regulated Entities 42
Section 5.14 No Burdensome Restrictions; No Restrictions
on Subsidiary Dividends 42
Section 5.15 Copyrights, Patents, Trademarks and
Licenses, Etc. 43
Section 5.16 Subsidiaries 43
Section 5.17 Insurance 43
Section 5.18 Solvency 43
Section 5.19 Swap Obligations 44
Section 5.20 Year 2000 44
Section 5.21 Merger Representations 44
Section 5.22 Full Disclosure 44
ARTICLE VI AFFIRMATIVE COVENANTS
Section 6.01 Financial Statements and Other Information 45
Section 6.02 Other Information 45
Section 6.03 Notices 45
Section 6.04 Inspection of Property and Books and
Records 46
Section 6.05 Use of Proceeds 46
Section 6.06 Convenants under Syndicate Credit
Agreement 47
Section 6.07 Further Assurances 47
ARTICLE VII NEGATIVE COVENANTS
Section 7.01 Use of Proceeds 47
Section 7.02 Covenants Under Syndicate Credit
Agreement 48
ARTICLE VIII EVENTS OF DEFAULT
Section 8.01 Event of Default 48
Section 8.02 Remedies 49
ARTICLE IX MISCELLANEOUS
Section 9.01 Amendments and Waivers 50
Section 9.02 Notices 50
Section 9.03 No Waiver; Cumulative Remedies 51
Section 9.04 Costs and Expenses 52
Section 9.05 Company Indemnification 52
Section 9.06 Marshalling; Payments Set Aside 53
Section 9.07 Successors and Assigns 53
Section 9.08 Assignments, Participations, Etc. 53
Section 9.09 Confidentiality 54
Section 9.10 Set-off 55
Section 9.11 Automatic Debits of Fees 56
Section 9.12 Counterparts 56
Section 9.13 Severability 56
Section 9.14 No Third Parties Benefited 56
Section 9.15 Governing Law and Jurisdiction 57
Section 9.16 Waiver of Jury Trial 57
Section 9.17 Entire Agreement 57
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of July 30, 1999,
between PRECISION CASTPARTS CORP., an Oregon corporation (the
"Company"), and BANK OF AMERICA, N.A. (the "Bank").
WHEREAS, the Bank has agreed to make available to the
Company a term loan facility, upon the terms and conditions set
forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties agree as
follows:
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms
. The following terms have the following meanings when used
herein (including in the recitals hereof):
"Acquired Company" means Xxxxx-Xxxxxx Company, a
Massachusetts corporation.
"Acquisition" means any transaction or series of
related transactions for the purpose of or resulting,
directly or indirectly, in (a) the acquisition of all or
substantially all of the assets of a Person, or of any
business or division of a Person, (b) the acquisition of in
excess of 50% of the capital stock, partnership interests,
membership interests or equity of any Person, or otherwise
causing any Person to become a Subsidiary, or (c) a merger
or consolidation or any other combination with another
Person (other than a Person that is a Subsidiary), provided
that the Company or the Subsidiary is the surviving Person.
"Affiliate" means, as to any Person, any other Person
which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person.
A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the
power to direct or cause the direction of the management and
policies of the other Person, whether through the ownership
of voting securities, membership interests, by contract, or
otherwise.
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"Agent" means the Bank in its capacity as
administrative agent for the Syndicate Banks under the
Syndicate Credit Agreement, and any successor agent
appointed or arising thereunder.
"Agreement" means this Credit Agreement.
"Applicable Fee Amount" means with respect to the
commitment fee payable hereunder, the amount set forth
opposite the indicated Level in the pricing grid set forth
on Annex I in accordance with the parameters for
calculations of such amount also set forth on Annex I.
"Applicable Margin" means, with respect to Base Rate
Loans and Offshore Rate Loans, the amount set forth opposite
the indicated Level below the heading "Base Rate Spread" or
"Offshore Rate Spread," as applicable, in the pricing grid
set forth on Annex I in accordance with the parameters for
calculations of such amounts also set forth on Annex I.
"Assignee" has the meaning specified in subsection
9.08(a).
"Attorney Costs" means and includes all fees and
disbursements of any law firm or other external counsel, the
allocated cost of internal legal services and all
disbursements of internal counsel.
"Availability Expiry Date" means the earliest to occur
of: (a) March 1, 2000; (b) the effective date of the
Merger; and (c) the date on which the Commitment terminates
in accordance with the provisions of this Agreement.
"Bank" has the meaning specified in the introductory
clause hereto.
"Bankruptcy Code" means the Federal Bankruptcy Reform
Act of 1978 (11 U.S.C. 101, et seq.).
"Bank's Payment Office" means the address for payments
set forth on Schedule 1 or such other address as the Bank
may from time to time specify.
"Base Rate" means, for any day, the higher of:
(a) 0.50% per annum above the latest Federal Funds Rate; and
(b) the rate of interest in effect for such day as publicly
announced from time to time by the Bank as its "reference
rate." (The "reference rate" is a rate set by the Bank
based upon various factors including the Bank's costs and
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desired return, general economic conditions and other
factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such
announced rate.) Any change in the reference rate announced
by the Bank shall take effect at the opening of business on
the day specified in the public announcement of such change.
"Base Rate Loan" means a Loan that bears interest based
on the Base Rate.
"Borrowing" means a borrowing of any Loan hereunder.
"Borrowing Date" means any date on which a Borrowing
occurs under Section 2.03.
"Bridge Maturity Date" means the date 364 days after
the Closing Date.
"Business Day" means any day other than a Saturday,
Sunday or other day on which commercial banks in San
Francisco are authorized or required by law to close and, if
the applicable Business Day relates to any Offshore Rate
Loan, means such a day on which dealings are carried on in
the London or other applicable offshore Dollar interbank
market.
"Capital Adequacy Regulation" means any guideline,
request or directive of any central bank or other
Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any bank or of any
corporation controlling a bank.
"Closing Date" means the date occurring on or before
March 1, 2000 on which all conditions precedent set forth in
Section 4.01 are satisfied or waived by the Bank.
"Code" means the Internal Revenue Code of 1986.
"Commitment" has the meaning specified in Section 2.01.
"Compliance Certificate" means a certificate
substantially in the form of Exhibit C to the Syndicate
Credit Agreement.
"Contingent Obligation" means, as to any Person, any
direct or indirect liability of that Person, whether or not
contingent, with or without recourse, (a) with respect to
any Indebtedness, lease, dividend, letter of credit or other
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obligation (the "primary obligations") of another Person
(the "primary obligor"), including any obligation of that
Person (i) to purchase, repurchase or otherwise acquire such
primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or
equity capital of the primary obligor or otherwise to
maintain the net worth or solvency or any balance sheet
item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such
primary obligation of the ability of the primary obligor to
make payment of such primary obligation, (iv) in connection
with any synthetic lease or other similar off balance sheet
lease transaction, or (v) otherwise to assure or hold
harmless the holder of any such primary obligation against
loss in respect thereof (each, a "Guaranty Obligation");
(b) with respect to any Surety Instrument issued for the
account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings or payments;
(c) to purchase any materials, supplies or other property
from, or to obtain the services of, another Person if the
relevant contract or other related document or obligation
requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of
whether delivery of such materials, supplies or other
property is ever made or tendered, or such services are ever
performed or tendered; or (d) in respect of any Swap
Contract. The amount of any Contingent Obligation shall, in
the case of Guaranty Obligations, be deemed equal to the
stated or determinable amount of the primary obligation in
respect of which such Guaranty Obligation is made or, if not
stated or if indeterminable, the maximum reasonably
anticipated liability in respect thereof, and in the case of
other Contingent Obligations other than in respect of Swap
Contracts, shall be equal to the maximum reasonably
anticipated liability in respect thereof and, in the case of
Contingent Obligations in respect of Swap Contracts, shall
be equal to the Swap Termination Value.
"Contractual Obligation" means, as to any Person, any
provision of any security issued by such Person or of any
agreement, undertaking, contract, indenture, mortgage, deed
of trust or other instrument, document or agreement to which
such Person is a party or by which it or any of its property
is bound.
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"Conversion/Continuation Date" means any date on which,
under Section 2.04, the Company (a) converts Loans of one
Type to another Type, or (b) continues as Loans of the same
Type, but with a new Interest Period, Loans having Interest
Periods expiring on such date.
"Default" means any event or circumstance which, with
the giving of notice, the lapse of time, or both, would (if
not cured or otherwise remedied during such time) constitute
an Event of Default.
"Disposition" means (i) the sale, lease, conveyance or
other disposition of property, other than (A) sales of
inventory in the ordinary course of business, (B) sales and
other dispositions of obsolete or unusable equipment,
(C) dispositions of defaulted receivables for collection in
the ordinary course of business, or (D) sales of receivables
pursuant to securitization programs; and (ii) the sale or
transfer by the Company or any Subsidiary of the Company of
any equity securities issued by any Subsidiary of the
Company and held by such transferor Person, in either case
to a Person other than the Company or a Subsidiary.
"Documents" means the Loan Documents, the Transaction
Documents and the Syndicate Loan Documents.
"Dollars," "dollars" and "$" each mean lawful money of
the United States.
"Eligible Assignee" means (a) a commercial bank
organized under the laws of the United States, or any state
thereof, and having a combined capital and surplus of at
least $250,000,000; (b) a commercial bank organized under
the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the
"OECD"), or a political subdivision of any such country, and
having a combined capital and surplus of at least
$250,000,000, provided that such bank is acting through a
branch or agency located in the United States; and (c) a
Person that is primarily engaged in the business of
commercial banking and that is (i) a Subsidiary of the Bank,
(ii) a Subsidiary of a Person of which the Bank is a
Subsidiary, or (iii) a Person of which the Bank is a
Subsidiary. No proposed assignee shall be an Eligible
Assignee if the effect of the assignment to the proposed
assignee would be to impose increased costs on the Company
pursuant to Section 3.01 or if the representation contained
in Section 4.01(f) of the Syndicate Credit Agreement would
not be true as to such Person if made as to such Person on
the date of assignment.
Page 5
"Environmental Claims" means all claims, however
asserted, by any Governmental Authority or other Person
alleging potential liability or responsibility for violation
of any Environmental Law.
"Environmental Laws" means all federal, state or local
laws, statutes, common law duties, rules, regulations,
ordinances and codes, together with all administrative
orders, directed duties, requests, licenses, authorizations
and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental, health,
safety and land use matters.
"ERISA" means the Employee Retirement Income Security
Act of 1974.
"ERISA Affiliate" means any trade or business (whether
or not incorporated) under common control with the Company
within the meaning of Section 414(b) or (c) of the Code (and
Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect
to a Pension Plan; (b) a withdrawal by the Company or any
ERISA Affiliate from a Pension Plan subject to Section 4063
of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a
withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Company or any ERISA Affiliate
from a Multiemployer Plan or notification that a
Multiemployer Plan is in reorganization; (d) the filing of a
notice of intent to terminate, the treatment of a Plan
amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to
terminate a Pension Plan or Multiemployer Plan; (e) an event
or condition which might reasonably be expected to
constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; or
(f) the imposition of any liability under Title IV of ERISA,
other than PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Company or any ERISA
Affiliate in excess of $5,000,000.
"Event of Default" means any of the events or
circumstances specified in Section 8.01.
Page 6
"Event of Loss" means, with respect to any property,
any of the following: (a) any loss, destruction or damage
of or to such property, (b) any pending or threatened
institution of any proceedings for the condemnation or
seizure of such property or for the exercise of any right of
eminent domain, or (c) any actual condemnation, seizure or
taking, by exercise of the power of eminent domain or
otherwise, of such property, or confiscation of such
property or the requisition of use of such property.
"Exchange Act" means the Securities Exchange Act of
1934.
"Existing Credit Facility" means the Credit Agreement
dated as of July 31, 1996, as amended, among the Company,
the Bank as agent, the other financial institutions party
thereto, and others.
"Existing Securities" means the Company's outstanding
debt securities under that certain Indenture dated as of
December 17, 1997.
"Federal Funds Rate" means, for any day, the rate set
forth in the weekly statistical release designated as
H.15(519), or any successor publication, published by the
Federal Reserve Bank of New York with respect to the
preceding Business Day opposite the caption "Federal Funds
(Effective)"; or, if for any relevant day such rate is not
so published with respect to any such preceding Business
Day, the rate for such day will be the arithmetic mean as
determined by the Bank of the rates for the last transaction
in overnight Federal funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers
of Federal funds transactions in New York City selected by
the Bank.
"Fee Letter" means the Fee Letter referred to in the
Syndicate Credit Agreement.
"FRB" means the Board of Governors of the Federal
Reserve System, and any Governmental Authority succeeding to
any of its principal functions.
"Further Taxes" means any and all present or future
taxes, levies, assessments, imposts, duties, deductions,
fees, withholdings or similar charges (including net income
taxes and franchise taxes), and all liabilities with respect
thereto, imposed by any jurisdiction on account of amounts
payable or paid pursuant to Section 3.01.
Page 7
"GAAP" means generally accepted accounting principles
set forth from time to time in the opinions and
pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting
Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of
the date of application.
"Governmental Authority" means any nation or
government, any state or other political subdivision
thereof, any central bank (or similar monetary or regulatory
authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any
corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the
foregoing.
"Guaranty Obligation" has the meaning specified in the
definition of "Contingent Obligation."
"Indebtedness" of any Person means, without
duplication, (a) all indebtedness for borrowed money;
(b) all obligations issued, undertaken or assumed as the
deferred purchase price of property or services (other than
trade payables and accrued liabilities incurred in the
ordinary course of business on ordinary terms); (c) all non-
contingent reimbursement or payment obligations with respect
to Surety Instruments; (d) all obligations evidenced by
notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the
acquisition of property, assets or businesses; (e) all
indebtedness created or arising under any conditional sale
or other title retention agreement, or incurred as
financing, in either case with respect to property acquired
by the Person (even though the rights and remedies of the
seller or bank under such agreement in the event of default
are limited to repossession or sale of such property);
(f) all obligations with respect to capital leases; (g) all
indebtedness referred to in clauses (a) through (f) above
secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured
by) any Lien upon or in property (including accounts and
contracts rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of
such Indebtedness; and (h) all Guaranty Obligations in
respect of indebtedness or obligations of others of the
kinds referred to in clauses (a) through (g) above; provided
Page 8
that Indebtedness shall not include sales of Permitted
Receivables sold pursuant to Permitted Receivables Purchase
Facilities and indemnification, recourse or repurchase
obligations thereunder. For all purposes of this Agreement,
the Indebtedness of any Person shall include any
Indebtedness of any partnership or joint venture in which
such Person is a general partner or a joint venturer to the
extent of any amount thereof as to which recourse to such
Person exists.
"Indemnified Liabilities" has the meaning specified in
Section 9.05.
"Indemnified Person" has the meaning specified in
Section 9.05.
"Independent Auditor" has the meaning specified in the
Syndicate Credit Agreement.
"Insolvency Proceeding" means, with respect to any
Person, (a) any case, action or proceeding with respect to
such Person before any court or other Governmental Authority
relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief
of debtors, or (b) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors,
or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; in
either case undertaken under U.S. Federal, state or foreign
law, including the Bankruptcy Code.
"Interest Payment Date" means (i) as to any Loan other
than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and, as to any Base Rate Loan, the
last Business Day of each calendar quarter and the Bridge
Maturity Date; provided, however, that if any Interest
Period for any Offshore Rate Loan exceeds three months, the
date that falls three months after the beginning of such
Interest Period and after each Interest Payment Date
thereafter is also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan,
the period commencing on the Borrowing Date of such Loan or
on the Conversion/Continuation Date on which the Loan is
converted into or continued as an Offshore Rate Loan, and
ending on the date one, two, three or six months thereafter;
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provided that:
(i) if any Interest Period would otherwise end on
a day that is not a Business Day, that Interest Period
shall be extended to the following Business Day unless
the result of such extension would be to carry such
Interest Period into another calendar month, in which
event such Interest Period shall end on the preceding
Business Day;
(ii) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the
calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar
month at the end of such Interest Period; and
(iii) no Interest Period for any Loan shall
extend beyond the Bridge Maturity Date.
"Investment Grade" has the meaning specified in
subsection 2.07(c).
"IRS" means the Internal Revenue Service, and any
Governmental Authority succeeding to any of its principal
functions under the Code.
"Lending Office" means the office or offices of the
Bank specified as its "Lending Office" or "Domestic Lending
Office" or "Offshore Lending Office," as the case may be, on
Schedule 1, or such other office or offices as the Bank may
from time to time notify to the Company.
"Lien" means any security interest, mortgage, deed of
trust, pledge, hypothecation, assignment, charge or deposit
arrangement, encumbrance, lien (statutory or other) or
preferential arrangement of any kind or nature whatsoever in
respect of any property having the same practical effect as
a security interest (including those created by, arising
under or evidenced by any conditional sale or other title
retention agreement, the interest of a lessor under a
capital lease, any financing lease having substantially the
same economic effect as any of the foregoing, or the filing
of any financing statement naming the owner of the asset to
which such lien relates as debtor, under the Uniform
Commercial Code or any comparable law), but not including
the interest of a lessor under an operating lease or the
interest of a purchaser of Permitted Receivables under any
Permitted Receivables Purchase Facility.
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"Loan" means an extension of credit, in the form of a
loan by the Bank to the Company under Article II, which may
be a Base Rate Loan or an Offshore Rate Loan (each a "Type"
of Loan).
"Loan Documents" means this Agreement, any Notes, the
Fee Letter, and all other documents delivered to the Bank in
connection with the transactions contemplated by this
Agreement.
"Margin Stock" means "margin stock" as such term is
defined in Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse
change in, or a material adverse effect upon, the
operations, business, or condition (financial or otherwise)
of the Company, the Acquired Company and its Subsidiaries
taken as a whole; (b) a material impairment of the ability
of the Company or any Subsidiary to perform under any
Document and to avoid any Event of Default; or (c) a
material adverse effect upon (i) the legality, validity,
binding effect or enforceability against the Company or any
Subsidiary of any Document. For purposes of this
definition, a liability shall be considered to be material
if it involves a cost to or expenditure by the Person of
$35,000,000 or more, net of amounts recoverable from
insurers where coverage is not contested or pursuant to
uncontested rights of subrogation, contribution or
indemnity.
"Merger" means the merger of the Acquired Company and
the Purchaser, as contemplated by the Merger Agreement.
"Merger Agreement" means the Agreement and Plan of
Merger, dated as of May 17, 1999, by and among the Company,
the Purchaser and the Acquired Company.
"Minimum Amount" means (i) in respect of any Borrowing,
conversion or continuation of Loans, an aggregate minimum
amount of $5,000,000 or any integral multiple of $1,000,000
in excess thereof, and (ii) in the case of any reduction of
the Commitment under Section 2.05, or optional prepayment of
Loans under Section 2.06, $10,000,000 or any multiple of
$1,000,000 in excess thereof.
"Minimum Condition" means the minimum number of shares
required to be tendered and not withdrawn prior to the
expiration of the Offer, as specified in the Merger
Agreement.
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"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan"
within the meaning of Section 4001(a)(3) of ERISA, to which
the Company or any ERISA Affiliate makes, is making, or is
obligated to make contributions or, during the preceding
three calendar years, has made, or been obligated to make,
contributions.
"Net Proceeds" means (i) as to the issuance of any debt
or equity securities by the Company, cash proceeds received
by the Company in connection therewith, net of ordinary and
necessary out-of-pocket costs and expenses paid or incurred
in connection therewith in favor of any Person not an
Affiliate of the Company; (ii) as to any Disposition by a
the Company or any Subsidiary, proceeds in cash, checks or
other cash equivalent financial instruments as and when
received by such Person, net of: (A) the direct costs
relating to such Disposition, excluding amounts payable to
such Person or any Affiliate of such Person, (B) sale, use
or other transaction taxes and capital gains taxes paid or
payable by such Person as a direct result thereof, and
(C) amounts required to be applied to repay principal,
interest and prepayment premiums and penalties on
Indebtedness secured by a purchase money security interest
on any asset which is the subject of such Disposition; and
(iii) as to any Event of Loss suffered by the Company or any
Subsidiary, proceeds in cash, checks or other cash
equivalent financial instruments as and when received by
such Person, net of (A) all money actually applied to repair
or reconstruct the damaged property or property affected by
the condemnation or taking, (B) all of the costs and
expenses reasonably incurred in connection with the
collection of such proceeds, award or other payments, and
(C) any amounts retained by or paid to parties having
superior rights to such proceeds, awards or other payments.
For purposes of determining the amount of Net Proceeds in
respect of any Disposition or Event of Loss, however, the
amount of proceeds calculated as provided above shall be
reduced by (i) $10,000,000 of the amount of such proceeds,
and (ii) the amount of the balance of such proceeds after
such reduction that such Person has used (or intends to use
within six months of the date of receipt of such proceeds)
to pay the purchase price in connection with any Acquisition
or Investment permitted by the Syndicate Credit Agreement,
it being understood that any portion of such balance of such
proceeds that has not been so used within such six month
Page 12
period shall be deemed to be Net Proceeds received on the
last day of such six month period and that all such proceeds
shall be deemed to be Net Proceeds at any time that an Event
of Default exists hereunder.
"Note" has the meaning specified in Section 2.02(b).
"Notice of Borrowing" means a notice in substantially
the form of Exhibit A.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means the Loans and other Indebtedness
arising under any Loan Document owing by the Company to the
Bank or any Indemnified Person, whether direct or indirect
(including those acquired by assignment), absolute or
contingent, due or to become due, now existing or hereafter
arising.
"Offer" means, collectively, the Tender Offer Statement
filed by the Purchaser on May 21, 1999 with the SEC on
Schedule 14D-1, the Offer to Purchase dated May 21, 1999,
the related letter of transmittal, and any public
announcement relating to the foregoing.
"Offshore Rate" means: (i) the rate of interest per
annum determined by the Bank to be the rate of interest per
annum (rounded upward to the nearest 1/100th of 1%)
appearing on Dow Xxxxx Page 3750 (as defined below) for
Dollar deposits in the approximate amount of the Offshore
Rate Loan to be made, continued or converted by Bank and
having a maturity comparable to such Interest Period, at
approximately 11:00 a.m. (London time) two Business Days
prior to the commencement of such Interest Period, subject
to clause (ii) below; or (ii) if for any reason the rate is
not available as provided in the preceding clause (i) of
this definition, the "Offshore Rate" instead means the rate
of interest per annum determined by the Bank to be the
arithmetic mean (rounded upward to the nearest 1/16th of 1%)
of the rates of interest per annum at which Dollar deposits
in the approximate amount of the Offshore Rate Loan to be
made, continued or converted by the Bank, and having a
maturity comparable to such Interest Period, would be
offered by the Bank to major banks in the London interbank
market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the commencement of such
Page 13
Interest Period. As used in this definition, "Dow
Xxxxx Page 3750" means the display designated as "3750" on
the Dow Xxxxx Market Service (formerly known as the Telerate
Service) or any replacement page thereof or successor
thereto.
"Offshore Rate Loan" means a Loan that bears interest
based on the Offshore Rate.
"Organization Documents" means, for any Person, the
certificate or articles of incorporation , the bylaws, any
certificate of determination or instrument relating to the
rights of preferred shareholders of such corporation, any
shareholder rights agreement, any other applicable
organizational or constitutional documents and all
applicable resolutions of the board of directors (or any
committee thereof) of such Person.
"Other Taxes" means any present or future stamp, court
or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made
hereunder or from the execution, delivery, performance,
enforcement or registration of, or otherwise with respect
to, this Agreement or any other Loan Documents.
"Participant" has the meaning specified in subsection
9.08(b).
"PBGC" means the Pension Benefit Guaranty Corporation,
or any Governmental Authority succeeding to any of its
principal functions under ERISA.
"Pension Plan" means a pension plan (as defined in
Section 3(2) of ERISA) subject to Title IV of ERISA which
the Company sponsors, maintains, or to which it makes, is
making, or is obligated to make contributions, or in the
case of a multiple employer plan (as described in Section
4064(a) of ERISA) has made contributions at any time during
the immediately preceding five (5) plan years.
"Permitted Liens" has the meaning specified in the
Syndicate Credit Agreement.
"Permitted Receivables" shall mean all obligations of
any obligor (whether now existing or hereafter arising)
under a contract for sale of goods or services by the
Company or any of its Subsidiaries, which shall include any
obligation of such obligor (whether now existing or
hereafter arising) to pay interest, finance charges or
Page 14
amounts with respect thereto, and, with respect to any of
the foregoing receivables or obligations, (a) all of the
interest of the Company or any of its Subsidiaries in the
goods (including returned goods) the sale of which gave rise
to such receivable or obligation after the passage of title
thereto to any obligor, (b) all other Liens and property
subject thereto from time to time purporting to secure
payment of such receivables or obligations, and (c) all
guarantees, insurance, letters of credit and other
agreements or arrangements of whatever character from time
to time supporting or securing payment of any such
receivables or obligations.
"Permitted Receivables Purchase Facility" shall mean
any agreement of the Company or any of its Subsidiaries
providing for sales, transfers or conveyances of Permitted
Receivables purporting to be sales (and considered sales
under GAAP) that do not provide, directly or indirectly, for
recourse against the seller of such Permitted Receivables
(or against any of such seller's Affiliates) by way of a
guaranty or any other support arrangement, with respect to
the amount of such Permitted Receivables (based on the
financial condition or circumstances of the obligor
thereunder), other than such limited recourse as is
reasonable given market standards for transactions of a
similar type, taking into account such factors as historical
bad debt loss experience and obligor concentration levels.
"Permitted Swap Obligations" means all obligations
(contingent or otherwise) of the Company or any Subsidiary
existing or arising under Swap Contracts, provided that each
of the following criteria is satisfied: (a) such
obligations are (or were) entered into by such Person in the
ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments or
assets held or reasonably anticipated by such Person, or
changes in the value of securities issued by such Person in
conjunction with a securities repurchase program not
otherwise prohibited hereunder, and not for purposes of
speculation or taking a "market view;" (b) such Swap
Contracts do not contain (i) any provision ("walk-away"
provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to
the defaulting party, or (ii) any provision creating or
permitting the declaration of an event of default,
termination event or similar event upon the occurrence of an
Event of Default hereunder (other than an Event of Default
under subsection 9.01(a).
Page 15
"Person" means an individual, partnership, corporation,
limited liability company, business trust, joint stock
company, trust, unincorporated association, joint venture,
Governmental Authority or any other entity of whatever
nature.
"Plan" means an employee benefit plan (as defined in
Section 3(3) of ERISA) which the Company sponsors or
maintains or to which the Company makes, is making, or is
obligated to make contributions and includes any Pension
Plan.
"Purchaser" means WGC Acquisition Corp., a
Massachusetts corporation and a Wholly-Owned Subsidiary of
the Company.
"Reportable Event" means, any of the events set forth
in Section 4043(c) of ERISA or the regulations thereunder,
other than any such event for which the 30-day notice
requirement under ERISA has been waived in regulations
issued by the PBGC.
"Requirement of Law" means, as to any Person, any law
(statutory or common), treaty, rule or regulation or
determination of an arbitrator or of a Governmental
Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any
of its property is subject.
"Responsible Officer" means the chief executive officer
or the president of the Company (or any other officer having
substantially the same authority and responsibility) or the
vice president and chief financial officer of the Company
(or any other officer having substantially the same
authority and responsibility); and, with respect
certification of financial statements or compliance with
financial covenants, the treasurer of the Company (or any
other officer having substantially the same authority and
responsibility).
"S&P" means Standard & Poor's Ratings Group.
"SEC" means the Securities and Exchange Commission, or
any Governmental Authority succeeding to any of its
principal functions.
"Senior Notes" means the notes to be issued by the
Company in a registered offering or pursuant to Rule 144A or
Page 16
in a private placement in an aggregate principal amount not
to exceed $300,000,000.
"Significant Subsidiary" means at any time (i) each
U.S. Subsidiary, and (ii) each Foreign Subsidiary, provided
that such Foreign Subsidiary has at such time either (A) net
sales for the preceding four fiscal quarter period in excess
of 1% of Consolidated Total Revenues or (B) total assets, as
of the last day of the preceding fiscal quarter,
constituting 1% or more of Consolidated Total Assets, in
each case based upon the Company's most recent annual or
quarterly financial statements delivered to the Bank under
Section 6.01.
"Solvent" means, as to any Person at any time, that
(a) the fair value of the property of such Person is greater
than the amount of such Person's liabilities (including
disputed, contingent and unliquidated liabilities) as such
value is established and liabilities evaluated for purposes
of Section 101(31) of the Bankruptcy Code and, in the
alternative, for purposes of the Uniform Fraudulent Transfer
Act (as enacted in the State of Oregon); (b) the present
fair saleable value of the property of such Person is not
less than the amount that will be required to pay the
probable liability of such Person on its debts as they
become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other
liabilities (including disputed, contingent and unliquidated
liabilities) as they mature in the normal course of
business; (d) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities
mature; and (e) such Person is not engaged in business or a
transaction, and is not about to engage in business or a
transaction, for which such Person's property would
constitute unreasonably small capital.
"Subsidiary" of a Person means any corporation ,
association, partnership, limited liability company, joint
venture or other business entity of which more than 50% of
the voting stock, membership interests or other equity
interests (in the case of Persons other than corporations),
is owned or controlled directly or indirectly by the Person,
or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly
requires, references herein to a "Subsidiary" refer to a
Subsidiary of the Company.
Page 17
"Surety Instruments" means all letters of credit
(including standby and commercial), banker's acceptances,
bank guaranties, shipside bonds, surety bonds and similar
instruments.
"Swap Contract" means any agreement, whether or not in
writing, relating to any transaction that is a rate swap,
basis swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap or option,
bond, note or xxxx option, interest rate option, forward
foreign exchange transaction, cap, collar or floor
transaction, currency swap, cross-currency rate swap,
swaption, currency option or any other, similar transaction
(including any option to enter into any of the foregoing) or
any combination of the foregoing, and, unless the context
otherwise clearly requires, any master agreement relating to
or governing any or all of the foregoing.
"Swap Termination Value" means, in respect of any one
or more Swap Contracts, after taking into account the effect
of any legally enforceable netting agreement relating to
such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination
value(s) determined in accordance therewith, such
termination value(s), and (b) for any date prior to the date
referenced in clause (a) the amount(s) determined as the
xxxx-to-market value(s) for such Swap Contracts, as
determined based upon one or more mid-market or other
readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Bank).
"Syndicate Banks" means the financial institutions from
time to time party as "Banks" to the Syndicate Credit
Agreement.
"Syndicate Credit Agreement" means that Credit
Agreement dated as of July ____, 1999 among the Company,
Bank, as Administrative Agent and Letter of Credit Issuing
Bank, and the other financial institutions party thereto.
"Syndicate Credit Agreement Event of Default" means an
"Event of Default" as defined in the Syndicate Credit
Agreement.
"Syndicate Loan Documents" means the "Loan Documents"
as defined in the Syndicate Credit Agreement.
"Taxes" means any and all present or future taxes,
levies, assessments, imposts, duties, deductions, fees,
Page 18
withholdings or similar charges, and all liabilities with
respect thereto, excluding, in the case of the Bank, taxes
imposed on or measured by its net income (or taxes imposed
in lieu of such net income taxes) by the jurisdiction (or
any political subdivision thereof) under the laws of which
the Bank is organized or maintains a Lending Office.
"Tender Offer" means the offer to purchase all
outstanding shares of common stock of the Acquired Company
for cash in accordance with the terms of the Offer.
"Tender Offer Expiry Date" means the date on which all
conditions to the Purchaser's obligation to purchase shares
of the Acquired Company pursuant to the Tender Offer as set
forth in Section 1.1(a) of the Merger Agreement have been
satisfied or waived.
"Transaction" means, collectively, the Acquisition of
the Acquired Company, through the Tender Offer undertaken by
the Purchaser, and the Merger.
"Transaction Documents" means the Merger Agreement,
together with the Offer, and all other documents and
agreements entered into between the Acquired Company and the
Company, the Purchaser and any of the Company's other
Subsidiaries in furtherance of the transactions contemplated
by the foregoing.
"Type" has the meaning specified in the definition of
"Loan."
"UCC" means the Uniform Commercial Code as in effect in
New York.
"Unfunded Pension Liability" means the excess of a
Plan's benefit liabilities under Section 4001(a)(16) of
ERISA, over the current value of that Plan's assets,
determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code
for the applicable plan year.
"United States" and "U.S." each means the United States
of America.
"U.S. Subsidiary" means a Subsidiary that is
incorporated under the laws of any jurisdiction (including
territories) of the United States or located in and a
resident of the United States.
Page 19
"Wholly-Owned Subsidiary" means any corporation in
which (other than directors' qualifying shares required by
law) 100% of the capital stock of each class having ordinary
voting power, and 100% of the capital stock of every other
class, in each case, at the time as of which any
determination is being made, is owned, beneficially and of
record, by the Company, or by one or more of the other
Wholly-Owned Subsidiaries, or both.
1.02 Other Interpretive Provisions.
(a) The meanings of defined terms are equally
applicable to the singular and plural forms of the defined terms.
(b) The words "hereof," "herein," "hereunder" and
similar words refer to this Agreement as a whole and not to any
particular provision of this Agreement; and subsection, Section,
Schedule and Exhibit references are to this Agreement unless
otherwise specified.
(c) The term "documents" includes any and all
instruments, documents, agreements, certificates, indentures,
notices and other writings, however evidenced.
(d) The term "including" is not limiting and means
"including without limitation."
(e) The term "to the best knowledge of the Company",
or any other term of similar import, means to the actual
knowledge of any executive officer of the Company or any employee
of the Company with management responsibility for the subject
matter as to which the Company's knowledge is relevant.
(f) In the computation of periods of time from a
specified date to a later specified date, the word "from" means
"from and including"; the words "to" and "until" each mean "to
but excluding," and the word "through" means "to and including."
(g) Unless otherwise expressly provided herein,
(i) references to agreements (including this Agreement) and other
contractual instruments shall be deemed to include all subsequent
amendments and other modifications thereto, but only to the
extent such amendments and other modifications are not prohibited
Page 20
by the terms of any Loan Document, and (ii) references to any
statute or regulation are to be construed as including all
statutory and regulatory provisions consolidating, amending,
replacing, supplementing or interpreting the statute or
regulation.
(h) The captions and headings of this Agreement are
for convenience of reference only and shall not affect the
interpretation of this Agreement.
(i) This Agreement and other Loan Documents may use
several different limitations, tests or measurements to regulate
the same or similar matters. All such limitations, tests and
measurements are cumulative and shall each be performed in
accordance with their terms. Unless otherwise expressly
provided, any reference to any action of the Bank by way of
consent, approval or waiver shall be deemed modified by the
phrase "in its sole discretion."
(j) This Agreement and the other Loan Documents are
the result of negotiations between the Bank and the Company, have
been reviewed by counsel to the Bank and the Company, and are the
products of all parties. Accordingly, they shall not be
construed against the Bank merely because of the Bank's
involvement in their preparation.
1.03 Accounting Principles.
(a) Unless the context otherwise clearly requires, all
accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement
shall be made, in accordance with GAAP, consistently applied.
(b) References herein to "fiscal year" and "fiscal
quarter" refer to such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitment.
The Bank agrees, on the terms and conditions set forth
herein, to make term loans on not more than three separate dates
to the Company (each such loan, a "Loan") from time to time on
any Business Day during the period from the Closing Date to the
Availability Expiry Date, in an aggregate amount not to exceed
Page 21
the amount of Three Hundred Million Dollars ($300,000,000) (such
amount, as the same may be reduced under Section 2.05 or 2.07,
the Bank's "Commitment"). Amounts borrowed which are repaid or
prepaid by the Company may not be reborrowed.
2.02 Loan Accounts.
(a) The Loans shall be evidenced by one or more
accounts or records maintained by Bank in the ordinary course of
business. The accounts or records maintained by Bank shall be
conclusive absent manifest error of the amount of the Loans made
by the Bank to the Company, and the interest and payments
thereon. Any failure so to record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the
Company hereunder to pay any amount owing with respect to the
Loans.
(b) Upon the request of the Bank the Loans may be
evidenced by one or more promissory notes (the "Notes"), instead
of or in addition to loan accounts. The Bank shall endorse on
the schedules annexed to the Notes the date, amount and maturity
of each Loan made by it and the amount of each payment of
principal made by the Company with respect thereto. The Bank is
irrevocably authorized by the Company to endorse its Notes and
the Bank's record shall be conclusive absent manifest error;
provided, however, that the failure of the Bank to make, or an
error in making, a notation thereon with respect to any Loan
shall not limit or otherwise affect the obligations of the
Company hereunder or under any such Note to the Bank.
2.03 Procedure for Borrowing.
(a) Each Borrowing shall be made upon the Company's
irrevocable written notice delivered to the Bank in the form of a
Notice of Borrowing (which notice must be received by the Bank
(i) not later than 9:00 a.m. (San Francisco time) at least three
Business Days prior to the requested Borrowing Date, in the case
of Offshore Rate Loans and (ii) not later than 9:00 a.m. (San
Francisco time) at least one Business Day before the requested
Borrowing Date, in the case of Base Rate Loans), specifying:
(i) the amount of the Borrowing, which shall be in
a Minimum Amount;
(ii) the requested Borrowing Date, which shall be a
Business Day;
(iii) the Type of Loans comprising the Borrowing; and
Page 22
(iv) if applicable, the duration of the Interest
Period applicable to such Loans included in such notice,
subject to the provisions of the definition of "Interest
Period" herein. If the Notice of Borrowing fails to specify
the duration of the Interest Period for any Borrowing
comprised of Offshore Rate Loans, such Interest Period shall
be 90 days or three months, respectively;
provided, however, that with respect to the Borrowing to be made
on the Closing Date, the Notice of Borrowing shall be delivered
to the Bank not later than 8:00 a.m. (San Francisco time) one
Business Day before the Closing Date and such Borrowing will
consist of Base Rate Loans only.
(b) The proceeds of each such Borrowing will then be
made available to the Company by the Bank at the Bank's Payment
Office by crediting the account of the Company on the books of
the Bank with such proceeds, or if requested by the Company, by
wire transfer in accordance with written instructions provided to
the Bank by the Company.
(c) After giving effect to any Borrowing, unless the
Bank shall otherwise consent, there may not be more than five
different Interest Periods in effect.
2.04 Conversion and Continuation Elections.
(a) The Company may, upon irrevocable written notice
to the Bank in accordance with subsection 2.04(b):
(i) elect, as of any Business Day, in the case of
Base Rate Loans, or as of the last day of the applicable
Interest Period, in the case of any other Type of Loans, to
convert any such Loans (or any part thereof in a Minimum
Amount) into Loans of any other Type; or
(ii) elect, as of the last day of the applicable
Interest Period, to continue any Loans having Interest
Periods expiring on such day (or any part thereof in a
Minimum Amount);
provided that if at any time the aggregate amount of Offshore
Rate Loans in respect of any Borrowing is reduced, by payment,
prepayment, or conversion of part thereof to be less than
$5,000,000, such Offshore Rate Loans shall automatically convert
into Base Rate Loans, and on and after such date the right of the
Company to continue such Loans as, and convert such Loans into,
Offshore Rate Loans shall terminate.
Page 23
(b) The Company shall deliver a Notice of
Conversion/Continuation to be received by the Bank (i) not later
than 9:00 a.m. (San Francisco time) at least three Business Days
in advance of the Conversion/ Continuation Date, if the Loans are
to be converted into or continued as Offshore Rate Loans; and
(ii) not later than 9:00 a.m. (San Francisco time) at least one
Business Day in advance of time on the Conversion/Continuation
Date, if the Loans are to be converted into Base Rate Loans,
specifying:
(i) the proposed Conversion/Continuation Date;
(ii) the aggregate amount of Loans to be converted
or continued;
(iii) the Type of Loans resulting from the proposed
conversion or continuation; and
(iv) other than in the case of conversions into Base
Rate Loans, the duration of the requested Interest Period,
subject to the provisions of the definition of "Interest
Period" herein.
(c) If upon the expiration of any Interest Period
applicable to Offshore Rate Loans, the Company has failed to
select timely a new Interest Period to be applicable to such
Offshore Rate Loans or if any Default or Event of Default then
exists, the Company shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the
expiration date of such Interest Period.
(d) Unless the Bank otherwise consents, during the
existence of a Default or an Event of Default, the Company may
not elect to have a Loan converted into or continued as an
Offshore Rate Loan.
(e) After giving effect to any conversion or
continuation of Loans, unless the Bank shall otherwise consent,
there may not be more than five different Interest Periods in
effect.
2.05 Voluntary Termination or Reduction of Commitments
. The Company may, upon not less than three Business Days'
prior notice to the Bank, terminate the Commitment, or
permanently reduce the Commitment, provided that the aggregate
amount of any partial reduction is in a Minimum Amount. Once
reduced in accordance with this Section 2.05, the Commitment may
not be increased. All accrued commitment fees to, but not
Page 24
including, the effective date of any termination of Commitment,
shall be paid on the effective date of such termination.
2.06 Optional Prepayments
. Subject to Section 3.04, the Company may, at any time or
from time to time, upon not less than (i) three Business Days'
irrevocable notice to the Bank (in the case of any Offshore Rate
Loans), and (ii) one Business Day's irrevocable notice to the
Bank (in the case of any Base Rate Loans), ratably prepay Loans
in whole or in part, in Minimum Amounts. Such notice of
prepayment shall specify the date and amount of such prepayment,
and the Type(s) of Loans to be prepaid. If such notice is given
by the Company, the Company shall make such prepayment and the
payment amount specified in such notice shall be due and payable
on the date specified therein, together with (other than in the
case of Base Rate Loans) accrued interest to each such date on
the amount prepaid and any amounts required pursuant to Section
3.04. Optional prepayments of Loans shall be applied in inverse
order of maturity.
2.07 Mandatory Prepayments of Loans; Mandatory Commitment
Reductions.
(a) If on the Availability Expiry Date the Commitment
shall exceed the outstanding principal amount of the Loans made,
such unused portion of the Commitment shall automatically
terminate on the Availability Expiry Date.
(b) If the Company or any of its Subsidiaries shall at
any time after the Closing Date make or agree to make a
Disposition, or shall suffer an Event of Loss, then (i) the
Company shall promptly notify the Bank of such proposed
Disposition or Event of Loss (including the amount of the
estimated Net Proceeds to be received in respect thereof) and
(ii) promptly upon receipt by the Company or the Subsidiary of
the Net Proceeds of such Disposition or Event of Loss, the
Company shall prepay Loans in an aggregate amount equal to the
amount of such Net Proceeds.
(c) If after the Closing Date the Company issues new
common or preferred equity, the Company shall promptly notify the
Bank of the estimated Net Proceeds of such issuance to be
received by the Company. Promptly upon its receipt of Net
Proceeds of such issuance, the Company shall prepay Loans in an
aggregate amount equal to the amount of such Net Proceeds;
provided that at any time the Company has attained Investment
Page 25
Grade debt ratings, such prepayments shall not be required
hereunder. As used herein, "Investment Grade" means actual or
implied senior unsecured long-term non-credit enhanced debt
ratings equal to or better than BBB- from S&P and Baa3 from
Xxxxx'x.
(d) If after the Closing Date the Company or any of
its Subsidiaries issues any debt securities (other than
commercial paper issued by the Company or its Subsidiaries up to
an aggregate amount of $200,000,000 at any time outstanding), the
Company shall promptly notify the Bank of the estimated Net
Proceeds of such issuance to be received by the Company or such
Subsidiary. Promptly upon the Company's or such Subsidiary's
receipt of the Net Proceeds of such issuance, the Company shall
prepay Loans in an aggregate amount equal to the amount of such
Net Proceeds.
(e) Any prepayments pursuant to this Section 2.07
shall be applied first to any Base Rate Loans then outstanding
and then to Offshore Rate Loans with the shortest Interest
Periods remaining; provided, however, that if the amount of Base
Rate Loans then outstanding is not sufficient to satisfy the
entire prepayment requirement, the Company may, at its option,
place any amounts which it would otherwise be required to use to
prepay Offshore Rate Loans on a day other than the last day of
the Interest Period therefor in an interest-bearing account
pledged to the Bank until the end of such Interest Period at
which time such pledged amounts will be applied to prepay such
Offshore Rate Loans. The Company shall pay, together with each
prepayment under this Section 2.07, accrued interest on the
amount of any Offshore Rate Loans prepaid and any amounts
required pursuant to Section 3.04.
2.08 Repayment
. The Company shall repay to the Bank the aggregate
outstanding principal amount of the Loans on the Bridge Maturity
Date.
2.09 Interest.
(a) Each Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to the Offshore Rate or the Base Rate, as
the case may be (and subject to the Company's right to convert to
other Types of Loans under Section 2.04), plus the Applicable
Margin.
Page 26
(b) Interest on each Loan shall be paid in arrears on
each Interest Payment Date applicable to such Loan. Interest
shall also be paid on the date of any prepayment of Loans (other
than Base Rate Loans) under Section 2.06 or 2.07 for the portion
of such Loans so prepaid and upon payment (including prepayment)
in full thereof and, during the existence of any Event of
Default, interest shall be paid on demand of the Bank.
(c) Notwithstanding subsection (a) of this Section,
while any Event of Default exists or after acceleration, the
Company shall pay interest (after as well as before entry of
judgment thereon to the extent permitted by law) on the principal
amount of all outstanding Obligations, at a rate per annum which
is determined by adding 2% per annum to the Applicable Margin
then in effect for such Loans and, in the case of Obligations not
subject to an Applicable Margin, at a rate per annum equal to the
Base Rate plus the Applicable Margin then in effect for Base Rate
Loans, plus 2% per annum; provided, however, that on and after
the expiration of any Interest Period applicable to any Offshore
Rate Loan outstanding on the date of occurrence of such Event of
Default or acceleration, the principal amount of such Loan shall,
during the continuation of such Event of Default or after
acceleration, bear interest at a rate per annum equal to the Base
Rate, plus the Applicable Margin then in effect for Base Rate
Loans, plus 2% per annum.
(d) Anything herein to the contrary notwithstanding,
the obligations of the Company hereunder shall be subject to the
limitation that payments of interest shall not be required for
any period for which interest is computed hereunder, to the
extent (but only to the extent) that contracting for or receiving
such payment by Bank would be contrary to the provisions of any
law applicable to Bank limiting the highest rate of interest that
may be lawfully contracted for, charged or received by Bank, and
in such event the Company shall pay Bank interest at the highest
rate permitted by applicable law.
2.10 Fees.
(a) Commitment Fees. The Company shall pay a
commitment fee on the actual daily unused portion of the Bank's
Commitment, computed on a quarterly basis in arrears on the last
Business Day of each calendar quarter based upon the daily
utilization for that quarter as calculated by the Bank at a rate
per annum equal to the Applicable Fee Amount. Such commitment
fee shall accrue from the date hereof to the Availability Expiry
Date and shall be due and payable quarterly in arrears on the
last Business Day of each calendar quarter to the Availability
Expiry Date, with the final payment to be made on the
Page 27
Availability Expiry Date, as the case may be; provided that in
connection with any reduction or termination of Commitment under
Section 2.05 or Section 2.07, the accrued commitment fee
calculated for the period ending on such date shall also be paid
on the date of reduction or termination. The commitment fees
provided in this subsection shall accrue at all times after the
above-mentioned commencement date, including at any time during
which one or more conditions in Article IV are not met.
(b) Utilization Fee. If at any time the Applicable
Margin is determined by reference to Level 1 as set forth in the
Pricing Grid in Annex I, the Company shall pay to the Bank a
utilization fee on the outstanding Loans, equal to .125% per
annum (any period during which such utilization fee is payable
being hereinafter referred to as a "Utilization Fee Accrual
Period"). Such utilization fee shall be computed on a quarterly
basis in arrears on the last Business Day of each calendar
quarter, shall accrue from the first day of any Utilization Fee
Accrual Period to the last day thereof and shall be due and
payable quarterly in arrears on the last Business Day of each
calendar quarter to the Bridge Maturity Date, with the final
payment to be made on the Bridge Maturity Date. The utilization
fee, if applicable, will be added to the Applicable Margin.
(c) Other Fees. The Company shall also pay such other
fees to the Bank as are required by the Fee Letter.
2.11 Computation of Fees and Interest.
(a) All computations of interest for Base Rate Loans
when the Base Rate is determined by the Bank's "reference rate"
shall be made on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed. All other computations of
fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more interest being
paid than if computed on the basis of a 365-day year). Interest
and fees shall accrue during each period during which interest or
such fees are computed from the first day thereof to the last day
thereof.
(b) Each determination of an interest rate by the Bank
shall be conclusive and binding on the Company in the absence of
manifest error. The Bank will, at the request of the Company,
deliver to the Company a statement showing the quotations used by
the Bank in determining any interest rate and the resulting
interest rate.
Page 28
2.12 Payments by the Company.
(a) All payments to be made by the Company shall be
made without set-off, recoupment or counterclaim. Except as
otherwise expressly provided herein, all payments by the Company
shall be made to the Bank at the Bank's Payment Office, and shall
be made in Dollars and in immediately available funds, no later
than 11:00 a.m. (San Francisco time) on the date specified
herein.
(b) Subject to the provisions set forth in the
definition of "Interest Period" herein, whenever any payment is
due on a day other than a Business Day, such payment shall be
made on the following Business Day, and such extension of time
shall in such case be included in the computation of interest or
fees, as the case may be.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.
(a) Any and all payments by the Company to the Bank
under this Agreement and any other Loan Document shall be made
free and clear of, and without deduction or withholding for, any
Taxes. In addition, the Company shall pay all Other Taxes.
(b) If the Company shall be required by law to deduct
or withhold any Taxes, Other Taxes or Further Taxes from or in
respect of any sum payable hereunder to the Bank, then:
(i) the sum payable shall be increased as necessary
so that, after making all required deductions and
withholdings (including deductions and withholdings
applicable to additional sums payable under this Section),
the Bank receives and retains an amount equal to the sum it
would have received and retained had no such deductions or
withholdings been made;
(ii) the Company shall make such deductions and
withholdings;
(iii) the Company shall pay the full amount deducted
or withheld to the relevant taxing authority or other
authority in accordance with applicable law; and
Page 29
(iv) the Company shall also pay to the Bank at the
time interest is paid, Further Taxes in the amount that the
Bank specifies as necessary to preserve the after-tax yield
the Bank would have received if such Taxes, Other Taxes or
Further Taxes had not been imposed.
(c) The Company agrees to indemnify and hold harmless
the Bank for the full amount of (i) Taxes, (ii) Other Taxes, and
(iii) Further Taxes in the amount that the Bank specifies as
necessary to preserve the after-tax yield such Bank would have
received if such Taxes, Other Taxes or Further Taxes had not been
imposed, and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect
thereto, whether or not such Taxes, Other Taxes or Further Taxes
were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the
Bank makes written demand therefor.
(d) Within 30 days after the date of any payment by
the Company of Taxes, Other Taxes or Further Taxes, the Company
shall furnish to the Bank the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment
reasonably satisfactory to the Bank.
(e) If the Company is required to pay any amount to
the Bank pursuant to subsection (b) or (c) of this Section, then
the Bank shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its
Lending Office so as to eliminate any such additional payment by
the Company which may thereafter accrue, if such change in the
sole judgment of the Bank is not otherwise disadvantageous to
such Bank.
3.02 Illegality.
(a) If the Bank determines that the introduction of
any Requirement of Law, or any change in any Requirement of Law,
or in the interpretation or administration of any Requirement of
Law, has made it unlawful, or that any central bank or other
Governmental Authority has asserted that it is unlawful, for the
Bank or its applicable Lending Office to make Offshore Rate
Loans, then, on notice thereof by the Bank to the Company, any
obligation of the Bank to make Offshore Rate Loans shall be
suspended until the Bank notifies the Company that the
circumstances giving rise to such determination no longer exist.
(b) If the Bank determines that it is unlawful to
maintain any Offshore Rate Loan, the Company shall, upon its
receipt of notice of such fact and demand from the Bank, prepay
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in full such Offshore Rate Loans of the Bank then outstanding,
together with interest accrued thereon and amounts required under
Section 3.04, either on the last day of the Interest Period
thereof, if the Bank may lawfully continue to maintain such
Offshore Rate Loans to such day, or immediately, if the Bank may
not lawfully continue to maintain such Offshore Rate Loan. If
the Company is required to so prepay any Offshore Rate Loan, then
concurrently with such prepayment, the Company shall borrow from
the affected Bank, in the amount of such repayment, a Base Rate
Loan.
(c) If the obligation of the Bank to make or maintain
Offshore Rate Loans has been so terminated or suspended, the
Company may elect, by giving notice to the Bank that all Loans
which would otherwise be made by the Bank as Offshore Rate Loans
shall be instead Base Rate Loans.
3.03 Increased Costs and Reduction of Return.
(a) If the Bank determines that, due to either (i) the
introduction of or any change in or in the interpretation of any
law or regulation or (ii) the compliance by the Bank with any
guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law), there shall
be any increase in the cost to the Bank of agreeing to make or
making, funding or maintaining any Offshore Rate Loans, then the
Company shall be liable for, and shall from time to time, upon
demand, pay to the Bank, additional amounts as are sufficient to
compensate the Bank for such increased costs.
(b) If the Bank shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change
in any Capital Adequacy Regulation, (iii) any change in the
interpretation or administration of any Capital Adequacy
Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or
(iv) compliance by the Bank (or its Lending Office) or any
corporation controlling the Bank with any Capital Adequacy
Regulation, affects or would affect the amount of capital
required or expected to be maintained by the Bank or any
corporation controlling the Bank and (taking into consideration
the Bank's or such corporation's policies with respect to capital
adequacy and the Bank's desired return on capital) determines
that the amount of such capital is increased as a consequence of
its Commitment, loans, credits or obligations under this
Agreement, then, upon demand of the Bank to the Company, the
Company shall pay to the Bank, from time to time as specified by
Page 31
the Bank, additional amounts sufficient to compensate the Bank
for such increase.
3.04 Funding Losses
. The Company shall reimburse the Bank and hold the Bank
harmless from any loss or expense which the Bank may sustain or
incur as a consequence of:
(a) the failure of the Company to make on a timely
basis any payment of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or
convert a Loan after the Company has given (or is deemed to have
given) a Notice of Borrowing or a Notice of Conversion/
Continuation;
(c) the failure of the Company to make any prepayment
in accordance with any notice delivered under Section 2.06 or
2.07;
(d) the prepayment (including pursuant to Section 2.06
or 2.07) or other payment (including after acceleration thereof)
of an Offshore Rate Loan on a day that is not the last day of the
relevant Interest Period; or
(e) the conversion under Section 2.04 of any Offshore
Rate Loan to a Base Rate Loan on a day that is not the last day
of the relevant Interest Period;
including any such loss or expense arising from the liquidation
or reemployment of funds obtained by it to maintain its Offshore
Rate Loans or from fees payable to terminate the deposits from
which such funds were obtained. For purposes of calculating
amounts payable by the Company to the Bank under this Section and
under subsection 3.03(a), each Offshore Rate Loan made by the
Bank (and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been funded at
the LIBOR used in determining the Offshore Rate for such Offshore
Rate Loan by a matching deposit or other borrowing in the
interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Offshore Rate Loan is in
fact so funded.
3.05 Inability to Determine Rates
. If the Bank determines that for any reason adequate and
reasonable means do not exist for determining the Offshore Rate
for any requested Interest Period with respect to a proposed
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Borrowing of Offshore Rate Loans or conversion or
continuation of Offshore Rate Loans, or that the Offshore Rate
applicable pursuant to subsection 2.09(a) for any requested
Interest Period with respect to a proposed Borrowing of Offshore
Rate Loans or a conversion into or continuation of Offshore Rate
Loans does not adequately and fairly reflect the cost to the Bank
of funding such Loans, the Bank will promptly so notify the
Company. Thereafter, the obligation of the Bank to make or
maintain Offshore Rate Loans, as the case may be, hereunder shall
be suspended until the Bank revokes such notice in writing. Upon
receipt of such notice, the Company may revoke any Notice of
Borrowing or Notice of Conversion/Continuation then submitted by
it. If the Company does not revoke such Notice, the Bank shall
make, convert or continue the Loans, as proposed by the Company,
in the amount specified in the applicable notice submitted by the
Company, but such Loans shall be made, converted or continued as
Base Rate Loans instead of Offshore Rate Loans.
3.06 Reserves on Offshore Rate Loans
. The Company shall pay to the Bank, as long as the Bank
shall be required under regulations of the FRB to maintain
reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as
"Eurocurrency liabilities"), additional interest on the unpaid
principal amount of each Offshore Rate Loan equal to the actual
costs of such reserves allocated to such Loan by the Bank (as
determined by the Bank in good faith, which determination shall
be conclusive absent manifest error), payable on each date on
which interest is payable on such Loan, provided the Company
shall have received at least 15 days' prior written notice of
such additional interest from the Bank. If the Bank fails to
give notice 15 days prior to the relevant Interest Payment Date,
such additional interest shall be payable 15 days from receipt of
such notice.
3.07 Certificates of Bank
(a) If the Bank claims reimbursement or compensation
under this Article III, it shall deliver to the Company a
certificate setting forth in reasonable detail the amount payable
to it hereunder and such certificate shall be conclusive and
binding on the Company in the absence of manifest error.
(b) Failure or delay on the part of the Bank to demand
compensation, reimbursement or indemnity under this Article III
for Taxes, Further Taxes, Other Taxes, increased costs, reduction
in amounts received or receivable, or reduction in return on
capital shall not constitute a waiver of the Bank's right to
Page 33
demand such compensation; provided that the Bank shall be
entitled to compensation under this Article III for any amounts
with respect to any date unless the Bank shall have notified the
Company not more than 90 days after the later of (i) such date
and (ii) the date on which the Bank shall have become aware of
such Taxes, Further Taxes, Other Taxes, costs or reductions.
3.08 Survival
. The agreements and obligations of the Company in this
Article III shall survive the termination of the Commitment and
the payment of all other Obligations.
ARTICLE IV
CONDITIONS PRECEDENT
4.01 Conditions of Initial Loan
. The obligation of the Bank to make its initial Loan
hereunder shall be subject to the condition that the Bank shall
have received on or before the Closing Date all of the following,
in form and substance reasonably satisfactory to it:
(a) Credit Agreement. This Agreement executed on or
before July 30, 1999 by the Company;
(b) Resolutions; Incumbency. Each of the following:
(i) Copies of the resolutions of the board of
directors of the Company authorizing the transactions
contemplated hereby, certified as of the Closing Date by the
Secretary or an Assistant Secretary of the Company; and
(ii) certificates of the Secretary or Assistant
Secretary of the Company, dated as of the Closing Date,
certifying the names, titles and true signatures of the
officers of the Company authorized to execute, deliver and
perform this Agreement and all other Documents to be
delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of
the documents required to be delivered under subsection 5.01(c)
of the Syndicate Credit Agreement;
(d) Legal Opinions. Each of the following:
Page 34
(i) An opinion of Stoel Rives LLP, counsel to the
Company and addressed to the Bank, dated the Closing Date,
substantially in the form of Exhibit D to the Syndicate
Credit Agreement; and
(ii) a favorable opinion of Xxxxxxx, Xxxxxxx &
Xxxxxxxx LLP, special counsel to the Bank, dated the Closing
Date;
(e) Payment of Fees. Evidence of payment by the
Company of all accrued and unpaid fees, costs and expenses to the
extent then due and payable on the Closing Date, together with
Attorney Costs of the Bank to the extent invoiced prior to or on
the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute the Bank's reasonable estimate of Attorney
Costs incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter
preclude final settling of accounts between the Company and
Bank); including any such costs, fees and expenses arising under
or referenced in Sections 2.10 and 9.04;
(f) Documents and Actions Relating to the Transaction.
A certificate of a Responsible Officer of the Company required
under subsection 5.01(f) of the Syndicate Credit Agreement;
(g) Documents and Actions Relating to the Syndicate
Credit Agreement. A certificate of a Responsible Officer of the
Company certifying that all conditions precedent to the closing
of the loans under the Syndicate Credit Agreement shall have been
satisfied in accordance with the terms and conditions thereof
(other than any conditions relating to the closing of the
transactions contemplated by this Agreement);
(h) Certificate. A certificate signed by a
Responsible Officer, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in
Article V are true and correct on and as of such date, as
though made on and as of such date (except to the extent
such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct
as of such earlier date); and
(ii) no Default or Event of Default exists or would
result from the Loans.
(i) Existing Credit Facility. Evidence satisfactory
to the Bank that the commitments to extend credit under the
Existing Credit Facility have been terminated and that all
Page 35
principal, interest, charges and fees due thereunder have been
paid or that arrangements reasonably satisfactory to the Bank for
the payment thereof have been made by the Bank (the Company
acknowledging that such commitments shall be terminated
simultaneously with the closing hereunder); and
(j) Other Documents.
(i) The financial statements and other documents
required to be delivered under subsection 5.01(j) of the
Syndicate Credit Agreement; and
(ii) such other approvals, opinions, documents or
materials as the Bank may reasonably request.
(k) Notice of Borrowing. The Bank shall have received
a Notice of Borrowing.
(l) Representations and Warranties. The
representations and warranties in Article V shall be true and
correct on and as of the Closing Date with the same effect as if
made on and as of the Closing Date (except to the extent such
representations and warranties expressly refer to an earlier
date, in which case they shall be true and correct as of such
earlier date); and
(m) No Existing Default. No Default or Event of
Default shall exist or shall result from the Loan.
4.02 Conditions to All Subsequent Loans
. The obligation of the Bank to make any subsequent Loan
after the Closing Date shall be subject to the satisfaction of
the following conditions precedent on the relevant Borrowing
Date:
(a) Notice. The Bank shall have received a Notice of
Borrowing;
(b) Representations and Warranties. The
representations and warranties in Article V shall be true and
correct on and as of such Borrowing Date with the same effect as
if made on and as of such Borrowing Date (except to the extent
such representations and warranties expressly refer to an earlier
date, in which case they shall be true and correct as of such
earlier date) and except that this subsection (b) shall be deemed
instead to refer to the last day of the most recent quarter and
year for which financial statements have then been delivered in
respect of the representation and warranty made in
subsection 5.11(a));
Page 36
(c) No Existing Default. No Default or Event of
Default shall exist or shall result from such Borrowing; and
(d) No Material Adverse Effect. There has occurred
since December 31, 1998 (as to the Company and its Subsidiaries)
and February 28, 1999 (as to the Acquired Company and its
Subsidiaries), no event or circumstances that has resulted or
could reasonably be expected to result in a Material Adverse
Effect.
Each Notice of Borrowing submitted by the Company hereunder shall
constitute a representation and warranty by the Company
hereunder, as of the date of each such notice and as of each
Borrowing Date, that the conditions in this Section 4.02 are
satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Bank that:
5.01 Corporate Existence and Power
. The Company and each of its Subsidiaries:
(a) (i) (in the case of the Company) is a corporation
duly organized and validly existing under the laws of the State
of Oregon, and (ii) (in the case of any Subsidiary) is a
corporation, limited liability company or partnership duly
organized or formed, as the case may be, validly existing and in
good standing (if applicable) under the laws of the jurisdiction
of its incorporation or formation;
(b) (i) has the organizational power and authority and
all material governmental licenses, authorizations, consents and
approvals to own its assets and carry on its business and
(ii) has the organizational power and authority and all
governmental licenses, authorizations, consents and approvals to
execute, deliver, and perform its obligations under the Documents
to which it is a party;
(c) is duly qualified, licensed and in good standing
under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires
such qualification, license or good standing; and
Page 37
(d) is in compliance with all material Requirements of
Law; except, in each case referred to in clause (a)(ii), (b)(i),
(c) or (d) where failure to do so could not reasonably be
expected to have a Material Adverse Effect.
5.02 Corporate Authorization; No Contravention
. The execution, delivery and performance by the Company
and its Subsidiaries of this Agreement and each other Document to
which such Person is party, have been duly authorized by all
necessary corporate action, and do not and will not:
(a) contravene the terms of any of that Person's
Organization Documents;
(b) conflict with or result in any breach or
contravention of, or the creation of any Lien (other than
Permitted Liens) under, any document evidencing any Contractual
Obligation to which such Person is a party or any order,
injunction, writ or decree of any Governmental Authority to which
such Person or its property is subject; or
(c) violate any Requirement of Law.
5.03 Governmental Authorization
. No approval, consent, exemption, authorization, or other
action by, or notice to, or filing with, any Governmental
Authority is necessary or required in connection with (i) the
execution, delivery or performance by, or enforcement against,
the Company or any of its Subsidiaries of this Agreement or any
other Document or (ii) the consummation of the Tender Offer or
the Transaction, except, in the case of this clause (ii),
(A) such as will be obtained before the Tender Offer Expiry Date
or (B) where failure to obtain or effect any of the foregoing
could not reasonably be expected to have a Material Adverse
Effect.
5.04 Binding Effect
.This Agreement and each other Document to which the Company
or any of its Subsidiaries is a party constitute the legal, valid
and binding obligations of the Company or the Subsidiary party
thereto, enforceable against such Person in accordance with their
respective terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
Page 38
(a) The Merger Agreement is in full force and effect,
enforceable against the parties thereto in accordance with its
terms, and has not been amended or modified in any material
respect since its date of execution. The Offer has not been
amended or modified in any material respect.
5.05 Litigation
. Except as specifically disclosed in Schedule 6.05 to the
Syndicate Credit Agreement, there are no actions, suits,
proceedings, claims or disputes pending, or to the best knowledge
of the Company, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the
Company, the Acquired Company, or its Subsidiaries or any of
their respective properties which:
(a) purport to affect or pertain to this Agreement or
any other Document, or any of the transactions contemplated
hereby or thereby; or
(b) if determined adversely to the Company or its
Subsidiaries, would reasonably be expected to have a Material
Adverse Effect. No injunction, writ, temporary restraining order
or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the
execution, delivery or performance of this Agreement or any other
Document, or directing that the transactions provided for herein
or therein not be consummated as herein or therein provided.
5.06 No Defaults
. No Default or Event of Default exists or would result
from the incurring of any Obligations by the Company. Neither
the Company nor any Subsidiary is in default under or with
respect to any Contractual Obligation in any respect which,
individually or together with all such defaults, could reasonably
be expected to have a Material Adverse Effect, or that would
create an Event of Default under subsection 9.01(e) of the
Syndicate Credit Agreement.
5.07 ERISA Compliance
. Except as specifically disclosed in Schedule 6.07 to the
Syndicate Credit Agreement:
(a) Each Plan is in compliance in all material
respects with the applicable provisions of ERISA, the Code and
other federal or state law. Each Plan which is intended to
qualify under Section 401(a) of the Code has received a favorable
Page 39
determination letter from the IRS and to the best knowledge of
the Company, nothing has occurred which would cause the loss of
such qualification where the failure to be so qualified could
reasonably be expected to have a Material Adverse Effect. The
Company and each ERISA Affiliate has made all required
contributions to any Plan subject to Section 412 of the Code, and
no application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code has been
made with respect to any Plan.
(b) There are no pending or, to the best knowledge of
Company, threatened claims, actions or lawsuits, or action by any
Governmental Authority, with respect to any Plan which has
resulted or could reasonably be expected to result in a Material
Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to
any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably
expected to occur; (ii) no Pension Plan has any Unfunded Pension
Liability; (iii) neither the Company nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability under
Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA);
(iv) neither the Company nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Section 4201 or 4243
of ERISA with respect to a Multiemployer Plan; and (v) neither
the Company nor any ERISA Affiliate has engaged in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA.
5.08 Use of Proceeds; Margin Regulations
. The proceeds of the Loans are to be used solely for the
purposes set forth in and permitted by Section 6.05 and Section
7.01. Neither the Company nor any Subsidiary is generally
engaged in the business of purchasing or selling Margin Stock or
extending credit for the purpose of purchasing or carrying Margin
Stock.
5.09 Title to Properties; Liens
. The Company and each Subsidiary have good record and
marketable title in fee simple to, or valid leasehold interests
in, all real property necessary or used in the ordinary conduct
of their respective businesses, except for such properties and
defects in title as could not, individually or in the aggregate,
Page 40
reasonably be expected to have a Material Adverse Effect. The
property of the Company and its Subsidiaries is subject to no
Liens, other than Permitted Liens.
5.10 Taxes
. The Company and its Significant Subsidiaries have filed
all Federal and other material tax returns and reports required
to be filed, and have paid all Federal and other material taxes,
assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise
due and payable, except those which are being contested in good
faith by appropriate proceedings and for which adequate reserves
have been provided in accordance with GAAP. There is no proposed
tax assessment against the Company or any Subsidiary that would,
if made, have a Material Adverse Effect.
5.11 Financial Condition
(a) . (a) The audited consolidated balance sheet of
the Company and its Subsidiaries dated March 29, 1998, the
unaudited balance sheet of the Company and its Subsidiaries dated
March 28, 1999 and, in each case, the related consolidated
statements of income or operations, shareholders' equity and cash
flows for the fiscal period ended on that date:
(i) were prepared in accordance with GAAP
consistently applied throughout the periods covered thereby,
except as otherwise expressly noted therein, subject to the
absence of footnotes and ordinary, good faith year end audit
adjustments in the case of quarterly financial statements;
(ii) fairly present in all material respects the
financial condition of the Company and its Subsidiaries as
of the date thereof and the results of operations and cash
flows for the periods covered thereby; and
(iii) except as specifically disclosed in Schedule
6.11 to the Syndicate Credit Agreement, reflect, by footnote
disclosure or otherwise, all material Indebtedness and other
liabilities, direct or contingent, of the Company and its
consolidated Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Contingent
Obligations.
(b) The pro forma financial statements of the Company
and its Subsidiaries referred to in subsection 4.01(j)(i) were
prepared on a basis consistent with GAAP as applied to the
Company's financial statements, have been prepared in good faith
Page 41
by the Company based on reasonable assumptions, are based on the
best information available to the Company as of the date of
delivery thereof, accurately reflect all material adjustments
required to be made to give effect to the Transaction, and
present fairly on a pro forma basis the estimated consolidated
financial position of the Company as of the date thereof,
assuming consummation of the Transaction.
(c) Since December 31, 1998 (as to the Company and its
Subsidiaries) and February 28, 1999 (as to the Acquired Company
and its Subsidiaries) there has not been any Material Adverse
Effect.
5.12 Environmental Matters
. The Company conducts in the ordinary course of business a
review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties,
and as a result thereof the Company has reasonably concluded
that, except as specifically disclosed in Schedule 6.12 to the
Syndicate Credit Agreement, such Environmental Laws and
Environmental Claims could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
5.13 Regulated Entities
. None of the Company, any Person controlling the Company,
or any Subsidiary, is an "Investment Company" within the meaning
of the Investment Company Act of 1940. The Company is not
subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act, the Interstate Commerce Act,
any state public utilities code, or any other Federal or state
statute or regulation limiting its ability to incur Indebtedness.
5.14 No Burdensome Restrictions; No Restrictions on
Subsidiary Dividends
. Neither the Company nor any Subsidiary is a party to or
bound by any Contractual Obligation, or subject to any
restriction in any Organization Document, or any Requirement of
Law, which could reasonably be expected to have a Material
Adverse Effect. Except as permitted by Section 8.16 of the
Syndicate Credit Agreement, neither the Company nor any
Subsidiary is a party to or bound by any Contractual Obligation
which expressly restricts, limits or prohibits the payment of
dividends by any Subsidiary or the making of any other
distribution in respect of such Subsidiary's capital stock.
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5.15 Copyrights, Patents, Trademarks and Licenses, Etc
. The Company or its Subsidiaries own or are licensed or
otherwise have the right to use all of the material patents,
trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably
necessary for the operation of their respective businesses,
without conflict with the rights of any other Person. To the
best knowledge of the Company, no slogan or other advertising
device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by the
Company or any Subsidiary infringes upon any rights held by any
other Person. Except as specifically disclosed in Schedule 6.05
to the Syndicate Credit Agreement, no claim or litigation
regarding any of the foregoing is pending or, to the best
knowledge of the Company, threatened, and no patent, invention,
device, application, principle or any statute, law, rule,
regulation, standard or code is pending or, to the best knowledge
of the Company, proposed, which, in either case, could reasonably
be expected to have a Material Adverse Effect.
5.16 Subsidiaries
. As of the Closing Date (after giving effect to the
Transaction), the Company has no Subsidiaries other than those
specifically disclosed in Schedule 6.16 to the Syndicate Credit
Agreement.
5.17 Insurance
. Except as specifically disclosed in Schedule 6.17 to the
Syndicate Credit Agreement, the properties of the Company and its
Subsidiaries are insured with financially sound and reputable
insurance companies not Affiliates of the Company, in such
amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses
and owning similar properties in localities where the Company or
such Subsidiary operates except to the extent the Company and its
Subsidiaries maintain a plan or plans of self-insurance to such
extent and covering such risks as is usual for companies of
similar size engaged in similar businesses and owning similar
properties.
5.18 Solvency
. The Company and its Significant Subsidiaries (taken as a
whole) are Solvent.
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5.19 Swap Obligations
. Neither the Company nor any of its Subsidiaries has
incurred any outstanding obligations under any Swap Contracts,
other than Permitted Swap Obligations. The Company has
undertaken its own independent assessment of its consolidated
assets, liabilities and commitments and has considered
appropriate means of mitigating and managing risks associated
with such matters and has not relied on any swap counterparty or
any Affiliate of any swap counterparty in determining whether to
enter into any Swap Contract.
5.20 Year 2000
. On the basis of a comprehensive review and assessment of
the Company's and its Subsidiaries' systems and equipment and
inquiry made of the Company's and its Subsidiaries' material
suppliers, vendors and customers, the Company's management is of
the view that the "Year 2000 problem" (that is, the inability of
computers, as well as embedded microchips in non-computing
devices, to perform properly date-sensitive functions with
respect to certain dates prior to and after December 31, 1999),
including costs of remediation, will not result in a Material
Adverse Effect. The Company and its Subsidiaries have developed
feasible contingency plans adequately to ensure uninterrupted and
unimpaired business operation in the event of failure of their
own or a third party's systems or equipment due to the Year 2000
problem, including those of vendors, customers, and suppliers, as
well as a general failure of or interruption in its
communications and delivery infrastructure.
5.21 Merger Representations
. All representations and warranties of the Purchaser or
the Company in the Merger Agreement are true and correct in all
material respects as of each date made or deemed made. To the
Company's knowledge, all representations and warranties of the
Acquired Company in the Merger Agreement are true and correct in
all material respects as of each date made or deemed made.
5.22 Full Disclosure
. None of the representations or warranties made by the
Company or any Subsidiary in the Documents as of the date such
representations and warranties are made or deemed made, and none
of the statements contained in the Offer or in any other exhibit,
report, statement or certificate furnished by or on behalf of the
Company or any Subsidiary in connection with the Documents
(including the offering and disclosure materials delivered by or
Page 44
on behalf of the Company to the Bank prior to the Closing
Date), contains any untrue statement of a material fact or omits
any material fact required to be stated therein or necessary to
make the statements made therein, in light of the circumstances
under which they are made, not misleading as of the time when
made or delivered; provided that to the extent any such
information, report, financial statement, exhibit or schedule was
based upon or constitutes a forecast or projection, the Company
represents only that it acted in good faith and utilized
reasonable assumptions and due care in the preparation of such
information, report, financial statement, exhibit or schedule (it
being understood that forecasts and projections by their nature
involve approximations and uncertainties).
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as the Bank shall have any Commitment hereunder, or
any Loan or other Obligation shall remain unpaid or unsatisfied,
unless the Bank waives compliance in writing:
6.01 Financial Statements and Other Information
. The Company shall deliver to the Bank, in form and detail
reasonably satisfactory to the Bank, the financial statements and
other documents, notices and certificates described in Section
7.01, 7.02 and 7.03 of the Syndicate Credit Agreement within the
time limits stipulated within such sections.
6.02 Other Information
. The Company shall promptly furnish to the Bank such
additional information regarding the business, financial or
corporate affairs of the Company or any Subsidiary as the Bank
may from time to time reasonably request.
6.03 Notices
. The Company shall promptly notify the Bank:
(a) but in no event more than 10 days after a
Responsible Officer becomes aware of the occurrence or existence
thereof, of the occurrence of any Default or Event of Default;
and
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(b) of any proposed waiver, amendment or modification
of the Syndicate Credit Agreement.
Each notice under this Section shall be accompanied by
a written statement by a Responsible Officer setting forth
details of the occurrence referred to therein, and stating what
action the Company or any affected Subsidiary proposes to take
with respect thereto and at what time. Each notice under
subsection 6.03(a) shall describe with particularity any and all
clauses or provisions of the Syndicate Credit Agreement, this
Agreement or other Loan Document, that have been (or foreseeably
will be) breached or violated, but the failure to correctly list
all such sections shall not, of itself, constitute a failure to
comply with this Section.
6.04 Inspection of Property and Books and Records
. The Company shall, and shall cause each Subsidiary to,
maintain proper books of record and account, in which full, true
and correct entries in conformity with local statutory reporting
requirements or GAAP consistently applied, as applicable, shall
be made of all financial transactions and matters involving the
assets and business of the Company and such Subsidiary. The
Company shall permit, and shall cause each Subsidiary to permit,
representatives and independent contractors of the Bank to visit
and inspect any of their respective properties, to examine their
respective corporate, financial, operating and other records, and
make copies thereof or abstracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at
such reasonable times during normal business hours and as often
as may be reasonably desired, upon reasonable advance notice to
the Company; provided, however, when an Event of Default exists
the Bank may do any of the foregoing at the expense of the
Company at any time during normal business hours and without
advance notice.
6.05 Use of Proceeds
. The Company shall use the proceeds of the Loans: (i) to
fund the purchase of shares tendered pursuant to the Tender
Offer, the consummation of the Merger and the payment of fees,
costs and expenses arising out of the Transaction; (ii) to
refinance Indebtedness of the Acquired Company; (iii) to
refinance the Indebtedness of the Company and certain of its
Subsidiaries under the Existing Credit Facility; and (iv) for
working capital and other general corporate purposes not in
Page 46
contravention of any Requirement of Law or of any Document
(including for purposes of undertaking Acquisitions; provided
that such Acquisitions do not contravene any provision of this
Agreement or of any other Document or any applicable Requirement
of Law).
6.06 Covenants under Syndicate Credit Agreement
. The Company shall at all times perform and comply or, as
appropriate, cause the performance and compliance with all
covenants set forth in Article VII of the Syndicate Credit
Agreement, as if such covenants were set forth in full herein.
6.07 Further Assurances
(a) The Company shall ensure that all written
information, exhibits and reports furnished to the Bank do not
and will not contain any untrue statement of a material fact and
do not and will not omit to state any material fact or any fact
necessary to make the statements contained therein not misleading
in light of the circumstances in which made, and will promptly
disclose to the Bank and correct any defect or error that may be
discovered therein or in any Document or in the execution,
acknowledgement or recordation thereof.
(b) Promptly upon request by the Bank, the Company
shall do, execute, acknowledge, and deliver any and all such
further acts, certificates, assurances and other instruments the
Bank may reasonably require from time to time in order to carry
out more effectively the purposes of this Agreement or any other
Loan Document.
ARTICLE VII
NEGATIVE COVENANTS
So long as the Bank shall have any Commitment hereunder, or
any Loan or other Obligation shall remain unpaid or unsatisfied:
7.01 Use of Proceeds
. The Company shall not, and shall not suffer or permit any
Subsidiary to, use any portion of the Loan proceeds, directly or
indirectly, (i) (A) to purchase or carry Margin Stock, (B) to
repay or otherwise refinance indebtedness of the Company or
others incurred to purchase or carry Margin Stock, or (C) to
extend credit for the purpose of purchasing or carrying any
Page 47
Margin Stock, in each case in violation of, or for a purpose
which violates, or would be inconsistent with, Regulation T, U or
X of the FRB, or (ii) to finance an Acquisition which is
contested at any time by the board of directors or equivalent
governing body of the acquired Person or the Person from whom the
Acquisition is to be made (an "Unfriendly Acquisition") or for a
bid to make an Unfriendly Acquisition.
7.02 Covenants Under Syndicate Credit Agreement
. The Company shall at all times perform and comply or, as
appropriate, cause the performance and compliance with all
covenants set forth in Article VIII of the Syndicate Credit
Agreement, as if such covenants were set forth in full herein.
ARTICLE VIII
EVENTS OF DEFAULT
8.01 Event of Default
. Any of the following shall constitute an "Event of
Default":
(a) Non-Payment. The Company fails to make, (i) when
and as required to be made herein, payments of any amount of
principal of any Loan, or (ii) within five days after the same
becomes due, payment of any interest, fee or any other amount
payable hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or
warranty by the Company or any Subsidiary made or deemed made
herein, in any other Loan Document, or which is contained in any
certificate, document or financial or other statement by the
Company, any Subsidiary, or any Responsible Officer, furnished at
any time under this Agreement, or in or under any other Loan
Document, is incorrect in any material respect on or as of the
date made or deemed made; or
(c) Specific Defaults. The Company fails to perform
or observe any term, covenant or agreement contained in any of
Section 6.01, 6.02(a) or 6.03, or in Article VII; or
(d) Other Defaults. The Company or any Subsidiary
party thereto fails to perform or observe any other term or
covenant contained in this Agreement or any other Loan Document,
Page 48
and such default shall continue unremedied for a period of 30
days after the earlier of (i) the date upon which a Responsible
Officer knew or reasonably should have known of such failure or
(ii) the date upon which written notice thereof is given to the
Company by the Bank; or
(e) Insolvency; Voluntary Proceedings. The Company or
any Significant Subsidiary (i) ceases or fails to be solvent, or
generally fails to pay, or admits in writing its inability to
pay, its debts as they become due, subject to applicable grace
periods, if any, whether at stated maturity or otherwise;
(ii) voluntarily ceases to conduct its business in the ordinary
course; (iii) commences any Insolvency Proceeding with respect to
itself; or (iv) takes any action to effectuate or authorize any
of the foregoing; or
(f) Involuntary Proceedings. (i) Any involuntary
Insolvency Proceeding is commenced or filed against the Company
or any Significant Subsidiary, or any writ, judgment, warrant of
attachment, execution or similar process, is issued or levied
against a substantial part of the Company's or any Significant
Subsidiary's properties, and any such proceeding or petition
shall not be dismissed, or such writ, judgment, warrant of
attachment, execution or similar process shall not be released,
vacated or fully bonded within 60 days after commencement, filing
or levy; (ii) the Company or any Significant Subsidiary admits
the material allegations of a petition against it in any
Insolvency Proceeding, or an order for relief (or similar order
under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) the Company or any Significant Subsidiary acquiesces in the
appointment of a receiver, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent therefor), or other
similar Person for itself or a substantial portion of its
property or business; or
(g) Default under Syndicate Credit Agreement. Any
Syndicate Credit Agreement Event of Default shall have occurred
and be continuing.
8.02 Remedies
. If any Event of Default occurs, the Bank may do any or
all of the following:
(a) declare the obligation of the Bank to make any
Loans hereunder to be terminated, whereupon such obligation shall
be terminated;
Page 49
(b) declare the unpaid principal amount of all
outstanding Loans, all interest accrued and unpaid thereon, and
all other amounts owing or payable hereunder or under any other
Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of
which are hereby expressly waived by the Company; and
(cn exercise all rights and
remedies available to it under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event
specified in subsection (e) or (f) of Section 8.01 (in the case
of clause (i) of subsection (f) upon the expiration of the 60-day
period mentioned therein), the obligation of the Bank to make
Loans shall automatically terminate and the unpaid principal
amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable
without further act of the Bank.
ARTICLE IX
MISCELLANEOUS
9.01 Amendments and Waivers
. No amendment or waiver of any provision of this Agreement
or any other Loan Document, and no consent with respect to any
departure by the Company or any applicable Subsidiary therefrom,
shall be effective unless the same shall be in writing and signed
by the Bank and the Company, and then any such waiver or consent
shall be effective only in the specific instance and for the
specific purpose for which given.
9.02 Notices
(a) All notices, requests, consents, approvals,
waivers and other communications shall be in writing (including,
unless the context expressly otherwise provides, by facsimile
transmission), and mailed, faxed or delivered, to the address or
facsimile number specified for notices on Schedule 1; or, as
directed to the Company or the Bank, to such other address as
shall be designated by such party in a written notice to the
other parties, and as directed to any other party, at such other
address as shall be designated by such party in a written notice
to the Company and the Bank.
Page 50
(b) All such notices, requests and communications
shall, when transmitted by overnight delivery, or faxed, be
effective when delivered for overnight (next-day) delivery, or
transmitted in legible form by facsimile machine, respectively,
or if mailed, upon the fifth Business Day after the date
deposited into the mails, or if delivered, upon delivery
(provided that all notices of a Default or an Event of Default
shall be given by overnight delivery or facsimile transmission,
and provided further that any failure to do so shall not impair
or limit the rights and remedies of the Bank resulting from the
existence of such Default or Event of Default); except that
notices pursuant to Article II to the Bank shall not be effective
until actually received by the Bank at the address specified for
the Bank on Schedule 1.
(c) Any agreement of the Bank herein to receive
certain notices by telephone or facsimile is solely for the
convenience and at the request of the Company. The Bank shall be
entitled to rely on the authority of any Person purporting to be
a Person authorized by the Company to give such notice and the
Bank shall not have any liability to the Company or other Person
on account of any action taken or not taken by the Bank in
reliance upon such telephonic or facsimile notice. The
obligation of the Company to repay the Loans shall not be
affected in any way or to any extent by any failure by the Bank
to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Bank of a confirmation which is at
variance with the terms understood by the Bank to be contained in
the telephonic or facsimile notice.
9.03 No Waiver; Cumulative Remedies
. No failure to exercise and no delay in exercising, on the
part of the Bank, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or
privilege. The rights provided for in this Agreement and the
other Loan Documents are cumulative and are not exclusive of any
other rights, powers, privileges or remedies provided by law or
in equity, or under any other instrument, document or agreement
now existing or hereafter arising.
Page 51
9.04 Costs and Expenses
. The Company shall:
(a) whether or not the transactions contemplated
hereby are consummated, pay or reimburse the Bank within five
Business Days after demand (subject to subsection 4.01(e)) for
all costs and expenses reasonably incurred by the Bank in
connection with (i) the development, preparation, delivery,
closing, administration and execution of, and any amendment,
supplement, waiver or modification to (in each case, whether or
not consummated), this Agreement, any Loan Document and any other
documents prepared in connection herewith or therewith, and
(ii) the consummation of the transactions contemplated hereby and
thereby; and
(b) pay or reimburse the Bank within five Business
Days after demand (subject to subsection 4.01(e)) for all costs
and expenses (including Attorney Costs) incurred by it in
connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement or
any other Loan Document during the existence of an Event of
Default or after acceleration of the Loans (including in
connection with any "workout" or restructuring regarding the
Loans, and including in any Insolvency Proceeding or appellate
proceeding).
9.05 Company Indemnification
. Whether or not the transactions contemplated hereby are
consummated, the Company shall indemnify, defend and hold the
Bank, the Bank's Affiliates and each of its respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each
an "Indemnified Person") harmless from and against any and all
liabilities, claims, obligations, losses, damages, penalties,
actions, judgments, suits, costs, charges, expenses and
disbursements (including reasonable Attorney Costs) of any kind
or nature whatsoever which may at any time (including at any time
following repayment of the Loans) be imposed on, incurred by or
asserted against any such Person arising out of any demand made
on or claim asserted against an Indemnified Person in any way
relating to or arising out of this Agreement, the Transaction,
the other Documents or any document contemplated by or referred
to therein, or the transactions contemplated hereby, or any
action taken or omitted by any such Person under or in connection
with any of the foregoing, including with respect to any
Page 52
investigation, litigation or proceeding (including any Insolvency
Proceeding or appellate proceeding) related to or arising out of
this Agreement or the Transaction, whether or not any Indemnified
Person is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"); provided that the Company shall have
no obligation hereunder to any Indemnified Person with respect to
Indemnified Liabilities to the extent they are found by a final
decision of a court of competent jurisdiction or in binding
arbitration to have resulted primarily from the gross negligence
or willful misconduct of or from materially misleading
information relating to and provided in writing by such
Indemnified Person. The agreements in this Section and in
Section 9.04 shall survive the termination of the Commitment and
the payment of all Obligations.
9.06 Marshalling; Payments Set Aside
. The Bank shall be under no obligation to marshal any
assets in favor of the Company or any other Person or against or
in payment of any or all of the Obligations. To the extent that
the Company makes a payment to the Bank, or the Bank exercises
its right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Bank in
its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any Insolvency Proceeding or otherwise,
then to the extent of such recovery the obligation or part
thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not
been made or such set-off had not occurred.
9.07 Successors and Assigns
. The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, except that the
Company may not assign or transfer any of its rights or
obligations under this Agreement without the prior written
consent of the Bank.
9.08 Assignments, Participations, Etc.
(a) (a) The Bank may, with the written consent of
the Company (which shall not be unreasonably withheld), at any
time assign and delegate to one or more Eligible Assignees (each
an "Assignee") all, or any ratable part of all, of the Loans, the
Commitment, and the other rights and obligations of the Bank
hereunder; provided, however, that (i) no written consent of the
Company shall be required during the existence of a Default or an
Page 53
Event of Default; and (ii) no written consent of the Company
shall be required in connection with any assignment and
delegation by the Bank to an Eligible Assignee that is an
Affiliate of the Bank; and provided further, however, that the
Company may continue to deal solely and directly with the Bank in
connection with the interest so assigned to an Assignee until the
Bank and its Assignee shall have delivered to the Company a
written notice of such assignment, together with payment
instructions, addresses and related information with respect to
the Assignee.
(b) The Bank may at any time sell to one or more
commercial banks or other Persons (a "Participant") participating
interests in any Loans, the Commitment and the other interests of
the Bank hereunder and under the other Loan Documents; provided,
however, that (i) the Bank's obligations under this Agreement
shall remain unchanged, (ii) the Bank shall remain solely
responsible for the performance of such obligations, (iii) the
Company shall continue to deal solely and directly with the Bank
in connection with the Bank's rights and obligations under this
Agreement and the other Loan Documents, and (iv) the Bank shall
not transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any
consent or waiver with respect to, this Agreement or any other
Loan Document, except to the extent such amendment, consent or
waiver would affect or involve any of the following: (A) any
increase or extension of the Commitment (or reinstatement of the
Commitment if terminated pursuant to Section 8.02); (B) any
postponement or delay of any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest, fees
or other amounts due to the Bank hereunder or under any other
Loan Document (including the date of any mandatory prepayment
hereunder); or (C) any reduction of the principal of, or the rate
of interest specified herein on any Loan, or any fees or other
amounts payable hereunder or under any other Loan Document.
9.09 Confidentiality
. The Bank agrees to take and to cause its Affiliates to
take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as
"confidential" or "secret" by the Company and provided to it by
the Company or any Subsidiary, or by the Agent on the Company's
or such Subsidiary's behalf, under this Agreement or any other
Loan Document, and neither it nor any of its Affiliates shall use
any such information other than in connection with or in
enforcement of this Agreement and the other Loan Documents or
Page 54
in connection with other business now or hereafter existing or
contemplated with the Company or any Subsidiary; except to the
extent such information (i) was or becomes generally available to
the public other than as a result of disclosure by the Bank, or
(ii) was or becomes available on a non-confidential basis from a
source other than the Company, provided that such source is not
bound by a confidentiality agreement with the Company known to
such Bank; provided, however, that the Bank may disclose such
information (A) at the request or pursuant to any requirement of
any Governmental Authority to which the Bank is subject or in
connection with an examination of such Bank by any such
authority; (B) pursuant to subpoena or other court process;
(C) when required to do so in accordance with the provisions of
any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which
the Bank or its Affiliates may be party; (E) to the extent
reasonably required in connection with the exercise of any remedy
hereunder or under any other Loan Document; (F) to the Bank's
independent auditors, legal counsel and other professional
advisors; (G) to any Participant or Assignee, actual or
potential, provided that such Person agrees in writing to keep
such information confidential to the same extent required of the
Bank hereunder; (H) as expressly permitted under the terms of any
other document or agreement regarding confidentiality to which
the Company or any Subsidiary is party or is deemed party with
such Bank or such Affiliate; and (I) to its Affiliates; provided,
that with respect to disclosures under clauses (B) and (D), the
Bank shall use commercially reasonable efforts to notify the
Company (unless such notification is prohibited by any applicable
Requirement of Law) of the proposed disclosure before such
disclosure is made to reasonably afford the Company the
opportunity to seek to prevent such disclosure.
9.10 Set-off
. In addition to any rights and remedies of the Bank
provided by law, if an Event of Default exists or the Loans have
been accelerated, the Bank is authorized at any time and from
time to time, without prior notice to the Company, any such
notice being waived by the Company to the fullest extent
permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, the
Bank to or for the credit or the account of the Company against
any and all Obligations owing to the Bank, now or hereafter
existing, irrespective of whether or not the Bank shall have made
demand under this Agreement or any Loan Document and although
such Obligations may be contingent or unmatured. The Bank agrees
Page 55
promptly to notify the Company after any such set-off and
application made by the Bank; provided, however, that the failure
to give such notice shall not affect the validity of such set-off
and application.
9.11 Automatic Debits of Fees
. With respect to any principal, interest, commitment fee,
arrangement fee, letter of credit fee or other fee, or any other
cost or expense (including Attorney Costs) due and payable to the
Bank under the Loan Documents, the Company hereby irrevocably
authorizes the Bank to debit any deposit account of the Company
with the Bank in an amount such that the aggregate amount debited
from all such deposit accounts does not exceed such principal,
interest, fee or other cost or expense. If there are
insufficient funds in such deposit accounts to cover the amount
of the payment then due, such debits will be reversed (in whole
or in part, in the Bank's sole discretion) and such amount not
debited shall be deemed to be unpaid. No such debit under this
Section shall be deemed a set-off.
9.12 Counterparts
. This Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be
deemed to constitute but one and the same instrument.
9.13 Severability
. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Agreement or
any instrument or agreement required hereunder.
9.14 No Third Parties Benefited
. This Agreement is made and entered into for the sole
protection and legal benefit of the Company, the Bank, the
Indemnified Persons and their successors and permitted assigns,
and no other Person shall be a direct or indirect legal
beneficiary of, or have any direct or indirect cause of action or
claim in connection with, this Agreement or any of the other Loan
Documents.
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9.15 Governing Law and Jurisdiction (a) THIS AGREEMENT AND
ANY NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK; PROVIDED THAT THE BANK SHALL
RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b)ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE COMPANY AND THE BANK CONSENT, FOR THEMSELVES AND
IN RESPECT OF THEIR PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION
OF THOSE COURTS. THE COMPANY AND THE BANK EACH IRREVOCABLY WAIVE
ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR
BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW
OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN
SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO.
9.16 Waiver of Jury Trial
. THE COMPANY AND THE BANK EACH WAIVE THEIR RESPECTIVE
RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER
LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY
TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS,
TORT CLAIMS, OR OTHERWISE. THE COMPANY AND THE BANK EACH AGREE
THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT
TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY
JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR
THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
9.17 Entire Agreement
. This Agreement, together with the other Loan Documents,
embodies the entire agreement and understanding among the Company
and the Bank and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written,
relating to the subject matter hereof and thereof.
(remainder of page intentionally left blank)
Page 57
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered in San Francisco, California,
by their proper and duly authorized officers as of the day and
year first above written.
PRECISION CASTPARTS CORP.
By: /s/ X.X. Xxxxxxx
Title: Vice President and Chief
Financial Officer
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx X. Xxxx
Title: Vice President
Page 58
SCHEDULE 1
PAYMENT OFFICES; ADDRESSES FOR NOTICES;
LENDING OFFICES
PRECISION CASTPARTS CORP.
Address for Notices:
Precision Castparts Corp.
Executive Office, Suite 240
0000 X.X. Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Attention: Treasurer
BANK OF AMERICA, N.A.
Notices for Borrowing, Conversions/Continuations, Payments and
Otherwise:
Bank of America, N.A.
Credit Services
0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Bank's Payment Office:
Bank of America, N.A.
0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Credit Services
Page 59
(continued.)
