EXHIBIT 10.28
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364-DAY
CREDIT AGREEMENT
Dated as of October 31, 2000
among
UNUMPROVIDENT CORPORATION
BANK OF AMERICA, N.A.,
as Administrative Agent,
CITICORP USA, INC.
and
WACHOVIA BANK, N.A.,
as Co-Syndication Agents
FLEET NATIONAL BANK,
as Documentation Agent
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
BANC OF AMERICA SECURITIES, LLC
as
Sole Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS ............................................................ 1
1.1 Certain Defined Terms ......................................... 1
1.2 Other Interpretive Provisions ................................. 21
1.3 Accounting Principles ......................................... 22
ARTICLE II
THE CREDITS ............................................................ 22
2.1 Amounts and Terms of Commitments .............................. 22
2.2 Loan Accounts ................................................. 22
2.3 Procedure for Borrowing ....................................... 23
2.4 Conversion and Continuation Elections ......................... 24
2.5 Voluntary Termination or Reduction of Commitments ............. 25
2.6 Optional Prepayments .......................................... 25
2.7 Repayment ..................................................... 25
2.8 Interest ...................................................... 26
2.9 Fees .......................................................... 26
2.10 Computation of Fees and Interest .............................. 27
2.11 Payments by the Company ....................................... 27
2.12 Payments by the Banks to the Agent ............................ 28
2.13 Sharing of Payments, Etc. ..................................... 28
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY ................................. 30
3.1 Taxes ......................................................... 30
3.2 Illegality .................................................... 31
3.3 Increased Costs and Reduction of Return ....................... 31
3.4 Funding Losses ................................................ 32
3.5 Inability to Determine Rates .................................. 33
3.6 Certificates of Banks ......................................... 33
3.7 Substitution of Banks ......................................... 33
3.8 Survival ...................................................... 33
ARTICLE IV
CONDITIONS PRECEDENT ................................................... 34
4.1 Conditions of Initial Loans ................................... 34
Section Page
4.2 Conditions to All Borrowings .................................. 35
ARTICLE V
REPRESENTATIONS AND WARRANTIES ......................................... 36
5.1 Corporate Existence and Power ................................. 36
5.2 Corporate Authorization; No Contravention ..................... 36
5.3 Governmental Authorization .................................... 36
5.4 Binding Effect ................................................ 37
5.5 Litigation .................................................... 37
5.6 No Default .................................................... 37
5.7 ERISA Compliance .............................................. 37
5.8 Use of Proceeds; Margin Regulations ........................... 38
5.9 Title to Properties ........................................... 38
5.10 Taxes ......................................................... 38
5.11 Financial Condition ........................................... 39
5.12 Regulated Entities ............................................ 39
5.13 No Burdensome Restrictions .................................... 39
5.14 Subsidiaries .................................................. 40
5.15 Environmental Compliance ...................................... 40
5.16 Insurance ..................................................... 40
5.17 Full Disclosure ............................................... 40
ARTICLE VI
AFFIRMATIVE COVENANTS .................................................. 40
6.1 Financial Statements .......................................... 40
6.2 Certificates, Notices and Other Information ................... 41
6.3 Payment of Taxes .............................................. 43
6.4 Preservation of Existence ..................................... 44
6.5 Maintenance of Properties ..................................... 44
6.6 Maintenance of Insurance ...................................... 44
6.7 Compliance With Laws .......................................... 44
6.8 Inspection Rights ............................................. 44
6.9 Keeping of Records and Books of Account ....................... 44
6.10 Compliance with ERISA ......................................... 45
6.11 Compliance With Agreements .................................... 45
6.12 Use of Proceeds ............................................... 45
ARTICLE VII
NEGATIVE COVENANTS ..................................................... 45
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Section Page
7.1 Indebtedness .................................................. 45
7.2 Liens and Negative Pledges .................................... 46
7.3 Consolidations and Mergers; Sales of Assets ................... 47
7.4 Loans, Acquisitions and Investments ........................... 48
7.5 Restricted Payments ........................................... 49
7.6 ERISA ......................................................... 49
7.7 Change in Nature of Business .................................. 49
7.8 Transactions with Affiliates .................................. 49
7.9 Hostile Acquisitions .......................................... 49
7.10 Financial Covenants ........................................... 49
ARTICLE VIII
EVENTS OF DEFAULT ...................................................... 50
8.1 Event of Default .............................................. 50
8.2 Remedies ...................................................... 52
8.3 Rights Not Exclusive .......................................... 52
ARTICLE IX
THE AGENT .............................................................. 53
9.1 Appointment and Authorization ................................. 53
9.2 Delegation of Duties .......................................... 53
9.3 Liability of Agent ............................................ 53
9.4 Reliance by Agent ............................................. 53
9.5 Notice of Default ............................................. 54
9.6 Credit Decision ............................................... 54
9.7 Indemnification ............................................... 54
9.8 Agent in Individual Capacity .................................. 55
9.9 Successor Agent ............................................... 55
9.10 Withholding Tax ............................................... 55
9.11 Documentation Agent; Syndication Agent ........................ 57
ARTICLE X
MISCELLANEOUS .......................................................... 58
10.1 Amendments and Waivers ........................................ 58
10.2 Notices ....................................................... 58
10.3 No Waiver; Cumulative Remedies ................................ 59
10.4 Costs and Expenses ............................................ 59
10.5 Indemnity ..................................................... 60
10.6 Payments Set Aside ............................................ 60
-iii-
Section Page
10.7 Binding Effect; Assignment .................................... 60
10.8 Confidentiality ............................................... 62
10.9 Set-off ....................................................... 62
10.10 Notification of Addresses, Lending Offices, Etc. .............. 63
10.11 Counterparts .................................................. 63
10.12 Severability .................................................. 63
10.13 No Third Parties Benefitted ................................... 63
10.14 Governing Law and Jurisdiction ................................ 63
10.15 Waiver of Jury Trial .......................................... 64
10.16 Entire Agreement .............................................. 64
SCHEDULES
Schedule 1.1 Subordinated Debt
Schedule 2.1 Commitments
Schedule 5.5 Litigation
Schedule 5.12 Regulated Entities
Schedule 5.14 Subsidiaries
Schedule 7.1 Indebtedness
Schedule 7.2 Liens and Negative Pledges
Schedule 10.2 Lending Offices; Addresses for Notices
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EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinion of Company's Counsel
Exhibit E Form of Notice of Assignment and Acceptance
Exhibit F Form of Promissory Note
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364-DAY CREDIT AGREEMENT
This 364-DAY CREDIT AGREEMENT is entered into as of October 31, 2000,
among UnumProvident Corporation, a Delaware corporation (the "Company"), the
several financial institutions from time to time party to this Agreement
(collectively, the "Banks"; individually, a "Bank"), Citicorp USA, Inc .and
Wachovia Bank, N.A., as Co-Syndication Agents, Fleet National Bank, as
Documentation Agent and Bank of America, N.A., as Administrative Agent for the
Banks.
WHEREAS, the Banks have agreed to make available to the Company a credit
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
1.1 Certain Defined Terms. The following terms have the following
meanings:
"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 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 entity.
"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, by contract, or otherwise.
"Agent" means Bank of America in its capacity as administrative
agent for the Banks hereunder, and any successor agent arising under
Section 9.9.
"Agent-Related Persons" means Bank of America and any successor
agent arising under Section 9.9, together with their respective Affiliates
(including, in the case of Bank of America, the Arranger), and the
officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.
"Agent's Payment Office" means the address for payments set forth on
Schedule 10.2 or such other address as the Agent may from time to time
specify.
"Agreement" means this Credit Agreement.
"Annual Statement" means the annual financial statement of any
insurance company as required to be filed with the Department, together
with all exhibits or schedules filed therewith, prepared in conformity
with SAP. References to amounts on particular exhibits, schedules, lines,
pages and columns of such Annual Statements are based on the formats
promulgated by the NAIC for 1999 Annual Statements for the applicable type
of insurance company. If such format is changed in future years so that
different information is contained in such items or they no longer exist,
it is understood that the reference is to information consistent with that
recorded in the referenced item in the 1999 Annual Statement of the
insurance company.
"Applicable Amount" means the following amounts per annum, based
upon the Debt Ratings:
Applicable Amount (in basis points per annum)
Pricing Debt Ratings Facility Utilization Offshore
Level S&P/Xxxxx'x Fee Fee Rate
1 A/A2 (or higher) 7.0 12.5 30.5
2 A-/A3 8.0 12.5 42.0
3 BBB+/Baa1 10.0 12.5 52.5
4 BBB/Baa2 15.0 12.5 72.5
5 Below BBB/Baa2 20.0 25.0 92.5
At the date hereof, Xxxxx 0 xxxxx xx applicable.
"Debt Ratings" means, as of any date of determination, the
rating as determined by either S&P or Xxxxx'x of the Company's
senior unsecured long-term debt; provided that if Debt Ratings are
issued by both of the foregoing Rating Agencies, then the less
creditworthy of such credit ratings shall apply, unless there is a
split in credit ratings of more than one level, in which case the
level one level lower than the more creditworthy rating shall apply.
The Debt Ratings shall be determined from the most recent public
announcement of any changes in the Debt Ratings. Any change in the
Applicable Amount shall become effective on and as of the date of
any public announcement of any Debt Ratings that indicates a
different Applicable Amount in accordance with this definition and
the above chart.
"Applicable Debt" means obligations described in clauses (a), (d) or
(f) of the definition of Indebtedness contained herein.
2
"Arranger" means Banc of America Securities LLC, a Delaware limited
liability company, as sole lead arranger and book manager.
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel and the
nonduplicative allocated cost of internal legal services and disbursements
of internal counsel.
"Bank" has the meaning specified in the introductory clause hereto.
"Bank of America" means Bank of America, N.A., a national banking
association.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. ss.101, et seq.).
"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 Bank of
America, as its "prime rate." (The "prime rate" is a rate set by Bank of
America based upon various factors including Bank of America's costs and
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 prime rate announced by Bank of America 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 hereunder consisting of Loans of the
same Type made to the Company on the same day by the Banks under Article
II, and, other than in the case of Base Rate Loans, having the same
Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.3.
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banks in Charlotte, North Carolina or New York,
New York 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 applicable offshore dollar interbank
market.
"Capitalized Lease Obligations" means, as to any Person, the
obligations of such Person to pay rent or other amounts under a lease of
(or other agreement conveying the right to use) real and/or personal
property which obligations are classified and accounted for as a capital
lease under Statement of Financial Accounting Standards No. 13 of the
Financial Accounting Standards Board.
3
"Cash Equivalents" means:
(a) securities issued or unconditionally guaranteed by the
United States government or any agency or instrumentality thereof,
in each case having maturities of not more than 12 months from the
date of acquisition thereof;
(b) securities issued by any state of the United States or any
political subdivision of any such state or any public
instrumentality thereof having maturities of not more than 12 months
from the date of acquisition thereof and, at the time of
acquisition, having a rating of at least A-2 or P-2 from either
Rating Agency, or, with respect to municipal bonds, a rating of at
least MIG 2 or VMIG 2 from Xxxxx'x;
(c) commercial paper issued by any Bank or any bank holding
company owning any Bank;
(d) commercial paper maturing not more than 12 months after
the date of creation thereof, and at the time of acquisition, having
a rating of A-1 or P-1 from either Rating Agency;
(e) commercial paper maturing not more than 6 months after the
date of creation thereof and, at the time of acquisition, having a
rating of A-2 or P-2 from either Rating Agency;
(f) domestic and eurodollar certificates of deposit or
bankers' acceptances maturing no more than one year after the date
of acquisition thereof which are either issued by any Bank or any
other banks having combined capital and surplus of not less than
$100,000,000 (or in the case of foreign banks, the dollar equivalent
thereof) or are insured by the Federal Deposit Insurance Corporation
for the full amount thereof; and
(g) repurchase agreements (including securities lending
agreements and dollar rolls), with a term of not more than 6 months
secured by the underlying securities and entered into with
securities dealers of recognized national standing.
"Change of Control" means, and shall be deemed to have occurred if:
(a) at any time Continuing Directors shall not constitute a majority of
the Board of Directors of the Company; or (b) any Person or "group"
(within the meaning of Section 13(d) or 14(d) of the Exchange Act), shall
at any time have acquired direct or indirect beneficial ownership of a
percentage equal to or more than 25% of the outstanding Voting Stock of
the Company.
"Closing Date" means the date on which all conditions precedent set
forth in Section 4.1 are satisfied or waived by all Banks (or, in the case
of Section 4.1(e), waived by the Person entitled to receive such payment).
4
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Commitment", as to each Bank, has the meaning specified in Section
2.1.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit C.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, with or without recourse, guaranteeing
or intended to guarantee any Indebtedness, lease, dividend or other
monetary obligation (the "primary obligations") of another Person (the
"primary obligor") in any manner, including any obligation of that Person
(a) to purchase, repurchase or otherwise acquire such primary obligations
or any security therefor, (b) 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, (c) 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 or (d) otherwise to assure or hold harmless the
holder of any such primary obligation against loss in respect thereof. The
amount of any Contingent Obligation shall be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or if indeterminable, the
maximum reasonably anticipated liability in respect thereof (assuming such
Person is required to perform thereunder), as determined by such Person in
good faith. Notwithstanding the foregoing, the term "Contingent
Obligation" shall not include (a) endorsements of instruments for deposit
or collection in the ordinary course of business, and (b) obligations of
any Insurance Subsidiary under Insurance Contracts, Reinsurance Agreements
and Retrocession Agreements (but not including any of the foregoing that
constitutes financial reinsurance).
"Continuing Director" means, at any date, an individual (a) who is a
member of the Board of Directors of the Company on the date hereof, (b)
who, as at such date, has been a member of such Board of Directors for at
least the 12 preceding months (or, for the period comprising the first 12
months after the date hereof, has been a member of the Board of Directors
at least since the date hereof), or (c) who has been nominated to be a
member of such Board of Directors by a majority of the other Continuing
Directors then in office.
"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.
"Conversion/Continuation Date" means any date on which, under
Section 2.4, the Company (a) converts Loans of one Type to another Type,
or (b) continues as Loans of the
5
same Type, but with a new Interest Period, Loans having Interest Periods
expiring on such date.
"D&H" means, collectively, Xxxxxxxxx & Xxxx Europe Ltd., a United
Kingdom company, Xxxxxxxxx & Xxxx Asia PTE Ltd., a Singapore company,
Xxxxxxxxx & Xxxx Underwriters Ltd., a United Kingdom company, Xxxxxxxxx &
Xxxx Syndicate Management Ltd., a United Kingdom company and their
respective Subsidiaries.
"Debt Ratings" has the meaning set forth in the definition of
"Applicable Amount".
"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.
"Department" means the applicable Governmental Authority of the
state of domicile of an insurance company responsible for the regulation
of said insurance company.
"Dollars", "dollars" and "$" each mean lawful money of the United
States.
"Eligible Assignee" means (a) a financial institution organized
under the laws of the United States, or any state thereof, and having a
combined capital and surplus of at least $100,000,000; (b) a commercial
bank organized under the laws of any other country which is a member of
the Organization for Economic Cooperation and Development, or a political
subdivision of any such country, and having a combined capital and surplus
of at least $100,000,000, provided that such bank is acting through a
branch or agency located in the United States; (c) a Person that is
primarily engaged in the business of commercial banking and that is (i) a
Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a Bank is a
Subsidiary, or (iii) a Person of which a Bank is a Subsidiary; (d) another
Bank; (e) any other entity which is an "accredited investor" (as defined
in Regulation D under the Securities Act of 1933, as amended) which
extends credit or buys loans as one of its businesses, including but not
limited to, insurance companies, mutual funds and lease financing
companies, and acceptable to the Agent; (f) a Person that is engaged in
the making, purchasing or investing in commercial loans in the ordinary
course of business, and acceptable to the Agent; or (g) other lenders or
institutional investors consented to in writing in advance by the Agent
and, so long as no Default or Event of Default has occurred and is
continuing, the Company (such consents not to be unreasonably withheld or
delayed). Neither the Company nor any Affiliate of the Company shall be an
Eligible Assignee.
"Environmental Laws" means all Laws relating to environmental,
health, safety and land use matters applicable to any property.
"Equity Interests" means, with respect to any Person, all shares,
interests (including membership and partnership interests), participations
or other equivalent (however
6
designated, whether voting or non-voting) of such Person's capital,
whether now outstanding or issued after the date hereof.
"ERISA" means the Employee Retirement Income Security Act of 1974
and any regulations issued pursuant thereto, as amended from time to time.
"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 that 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 Sections 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.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate".
"Event of Default" means any of the events or circumstances
specified in Section 8.1.
"Exchange Act" means the Securities and Exchange Act of 1934, and
regulations promulgated thereunder.
"FAS 113" means Statement of Accounting Standards No. 113 and
regulations promulgated thereunder.
"FAS 115" means Statement of Accounting Standards No. 115 and
regulations promulgated thereunder.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds
7
brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if such
day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is
so published on such next succeeding Business Day, the Federal Funds Rate
for such day shall be the average rate charged to Bank of America on such
day on such transactions as determined by Agent.
"Fee Letter" has the meaning specified in Section 2.9.
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"GAAP" means generally accepted accounting principles in the United
States as in effect and 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
United States accounting profession); provided that if there occurs after
the date hereof any change in GAAP that affects in any respect the
calculation of any covenant contained in Section 7.10, the Banks and the
Company shall negotiate in good faith amendments to the provisions of this
Agreement that relate to the calculation of such covenant with the intent
of having the respective positions of the Banks and the Company after such
change in GAAP conform as nearly as possible to their respective positions
as of the date of this Agreement and, until any such amendments have been
agreed upon, the covenants in Section 7.10 shall be calculated as if no
such change in GAAP has occurred.
"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.
"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 (including reinsurance payables) entered into in the
ordinary course of business on ordinary terms) that in accordance with
GAAP would be shown on the liability side of the balance sheet of such
Person; (c) the face amount of all letters of credit or surety bonds
issued for the account of such Person and, without duplication, all drafts
drawn thereunder; (d) all obligations evidenced by notes, bonds,
debentures or similar instruments or incurred in connection with bankers'
acceptances, 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 that in accordance with GAAP would be shown on the
8
liability side of the balance sheet of such Person; (f) all obligations
with respect to Capitalized Lease Obligations; (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; (h) all obligations of such Person under Swap Contracts; (i)
obligations under synthetic leases; and (j) without duplication, all
Contingent Obligations of such Person; provided that Indebtedness shall
not include obligations of any Insurance Subsidiary under or pursuant to
Insurance Contracts, Reinsurance Agreements and Retrocession Agreements,
trade payables and accrued expenses, in each case arising in the ordinary
course of business but shall include any Reinsurance Agreement or
Retrocession Agreement that would be disallowed under FAS 113. For all
purposes of this Agreement, the Indebtedness of any Person shall include
all recourse Indebtedness of any partnership, joint venture or limited
liability company in which such Person is a general partner, a joint
venturer or a member and for which such Person has liability.
"Indemnified Liabilities" has the meaning specified in Section 10.5.
"Indemnified Person" has the meaning specified in Section 10.5.
"Insolvency Proceeding" means (a) any case, action or proceeding
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; undertaken under U.S. Federal, state
or foreign law, including the Bankruptcy Code.
"Insurance Code" means, with respect to any insurance company, the
insurance code of its state of domicile and any successor statute of
similar import, together with the regulations thereunder, as amended or
otherwise modified and in effect from time to time. References to sections
of the Insurance Code shall be construed to also refer to successor
sections.
"Insurance Contract" means any insurance contract or policy issued
by an Insurance Subsidiary but shall not include any Reinsurance Agreement
or Retrocession Agreement.
"Insurance Subsidiary" means each Subsidiary of the Company
identified as an Insurance Subsidiary (including Subsidiaries of such
Subsidiary) on Schedule 5.14 and each other Subsidiary (including
Subsidiaries of such Subsidiary) from time to time in the insurance
business as certified by the Company in writing to the Agent.
9
"Interest Payment Date" means, as to any Offshore 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 each
date such Loan is converted into another Type of Loan, provided, however,
that if any Interest Period 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.
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 shall extend beyond the Revolving
Termination Date.
"Interim Statements" means the quarterly financial statement of any
insurance company as required to be filed with the Department, together
with all exhibits or schedules filed therewith, prepared in conformity
with SAP. References to amounts on particular exhibits, schedules, lines,
pages and columns of such interim statements are based on the formats
promulgated by the NAIC for 1999 interim statements for the applicable
type of insurance company. If such format is changed in future years so
that different information is contained in such terms or they no longer
exist, it is understood that the reference is to information consistent
with that recorded in the referenced item in the 1999 interim statement of
the insurance company.
"Investment" has the meaning specified in Section 7.4.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
10
"Laws" or "Law" means all international, foreign, federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances,
codes and administrative or judicial precedents or authorities, including
the interpretation or administration thereof by any Governmental Authority
charged with the enforcement, interpretation or administration thereof,
and all applicable administrative orders, directed duties, requests,
licenses, authorizations and permit of, and agreements with, any
Government Authority, in each case whether or not having the force of law.
"Legal Requirements" means all applicable laws, rules, orders and
regulations made by any governmental body or regulatory authority
(including any Department) having jurisdiction over the Company or a
Subsidiary of the Company.
"Lending Office" means, as to any Bank, the office or offices of
such Bank specified as its "Lending Office" or "Domestic Lending Office"
or "Offshore Lending Office", as the case may be, on Schedule 10.2, or
such other office or offices as such Bank may from time to time notify the
Company and the Agent.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement (in the nature of compensating balances, cash
collateral accounts or security interests), encumbrance, lien (statutory
or other), charge, or preference, priority or other security interest or
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any financing lease
having substantially the same economic effect as any of the foregoing, and
the filing of any financing statement under the Uniform Commercial Code or
comparable Laws of any jurisdiction), including the interest of a
purchaser of accounts receivable.
"Loan" means an extension of credit by a Bank to the Company under
Article II, and 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 Agent or any Bank in connection
herewith.
"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, properties,
condition (financial or otherwise) or prospects of the Company or the
Company and its Subsidiaries taken as a whole; (b) a material impairment
of the ability of the Company to perform under any Loan Document and to
avoid any Event of Default; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Company
of any Loan Document.
"Material Insurance Subsidiary" means a Material Subsidiary that is
also an Insurance Subsidiary.
11
"Material Subsidiary" means, at any time, (a) each of Unum Life
Insurance Company of America, First Unum Life Insurance Company, Provident
Life & Accident Insurance Company, The Xxxx Xxxxxx Life Insurance Company
and Colonial Life & Accident Insurance Company and each other Subsidiary
from time to time identified by the Company as a Material Subsidiary, and
(b) each other Subsidiary having (on a consolidated basis with its
Subsidiaries) at such time either (i) total (gross) revenues for any four
fiscal quarter period in excess of 10% of the total (gross) revenues of
the Company and its Subsidiaries for such four fiscal quarter period or
(ii) total assets, as of the last day of the preceding fiscal quarter,
having a net book value in excess of 10% of the total assets of the
Company and its Subsidiaries as of such day, in each case, based upon the
Company's most recent annual or quarterly financial statements delivered
to the Agent under Section 6.1.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA.
"NAIC" means the National Association of Insurance Commissioners or
any successor thereto.
"Negative Pledge" means a Contractual Obligation limiting the
ability to create a Lien.
"Net Income" means, for any period, the net income of the Company
and its Subsidiaries on a consolidated basis in accordance with GAAP.
"Net Worth" means, at any time, the sum of all amounts (without
duplication) which, in accordance with GAAP, would be included in the
Company's stockholders' equity (excluding unrealized gains or losses
recorded pursuant to FAS 115) as required to be reported in the Company's
then most recent consolidated balance sheet required to be delivered to
the Agent pursuant to this Agreement.
"Note" means a promissory note executed by the Company in favor of a
Bank pursuant to Section 2.2(b), in substantially the form of Exhibit F.
"Notice of Assignment and Acceptance" means a notice substantially
in the form of Exhibit E.
"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.
12
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
to any Bank, the Agent, 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.
"Offshore Rate" means for any Interest Period with respect to any
Offshore Rate Loan, a rate per annum determined by Agent pursuant to the
following formula:
Offshore Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"LIBOR" means, for such Interest Period:
(a) the rate per annum (carried out to the fifth decimal
place) equal to the rate determined by the Agent to be the offered
rate that appears on the page of the Telerate Screen that displays
an average British Bankers Association Interest Settlement Rate for
deposits in Dollars (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period, determined
as of approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period, or
(b) in the event the rate referenced in the preceding
subsection (a) does not appear on such page or service or such page
or service shall cease to be available, the rate per annum (carried
out to the fifth decimal place) equal to the rate determined by the
Agent to be the offered rate on such other page or other service
that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first
day of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, or
(c) in the event the rates referenced in the preceding
subsections (a) and (b) are not available, the rate per annum
determined by the Agent as the rate of interest at which Dollar
deposits (for delivery on the first day of such Interest Period) in
same day funds in the approximate amount of the applicable Offshore
Rate Loan and with a term equivalent to such Interest Period would
be offered by its London Branch to major banks in the offshore
Dollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest
Period.
"Eurodollar Reserve Percentage" means, for any day during any
Interest Period, the reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day,
whether or not applicable to any Bank, under regulations issued from
time to time by the Board of Governors of the Federal
13
Reserve System for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Offshore Rate for
each outstanding Offshore Rate Loan shall be adjusted automatically
as of the effective date of any change in the Eurodollar Reserve
Percentage.
The determination of the Eurodollar Reserve Percentage and
LIBOR by the Agent shall be conclusive in the absence of manifest
error.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate.
"Ordinary Course Indebtedness" means:
(a) Indebtedness under the Loan Documents;
(b) intercompany Indebtedness (i.e., Indebtedness of the
Company or any of its Subsidiaries to the Company or any of its
Subsidiaries);
(c) Indebtedness arising from the honoring of a check, draft
or similar instrument against insufficient funds; and
(d) Ordinary Course Swap Obligations.
"Ordinary Course Liens" means:
(a) Liens pursuant to any Loan Document;
(b) Liens for taxes not yet due or which are being contested
in good faith and by appropriate proceedings, if adequate reserves
with respect thereto are maintained on the books of the applicable
Person in accordance with GAAP;
(c) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business which are not overdue for a period of more than 30 days or
which are being contested in good faith and by appropriate
proceedings, if adequate reserves with respect thereto are
maintained on the books of the applicable Person;
(d) pledges or deposits in connection with worker's
compensation, unemployment insurance and other social security
legislation;
(e) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds,
14
performance bonds and other obligations of a like nature incurred in
the ordinary course of business; and
(f) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are
not substantial in amount, and which do not in any case materially
detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of any Person.
"Ordinary Course Swap Obligations" means all obligations (contingent
or otherwise) of Company or any Subsidiary existing or arising under any
Swap Contract, 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 property 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", and (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.
"Organization Documents" means, for any corporation, 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, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
"Other Credit Agreement" means the Five-Year Credit Agreement dated
October 31, 2000 among the Company, certain banks, Citicorp USA, Inc. and
Wachovia Bank, N.A., as Co-Syndication Agents, Fleet National Bank, as
Documentation Agent and the Bank of America, as Administrative Agent.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
"Pension Plan" means any "employee pension benefit plan" (as such
term is defined in Section 3(2) of ERISA), other than a Multiemployer
Plan, that is subject to Title IV of ERISA and is sponsored or maintained
by the Company or any ERISA Affiliate or to which the Company or any ERISA
Affiliate contributes or has an obligation to contribute, 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 plan
years.
15
"Permitted Acquisition" means, at any time of determination, any
Acquisition by the Company or any of its Subsidiaries with respect to
which each of the following requirements are met:
(a) such Acquisition has been approved and recommended by the
board of directors or general partner (or similar entity) of the
Person to be acquired or which owns the assets of the Person be
acquired;
(b) in respect of any Acquisition the total purchase price for
which equals or exceeds $50,000,000, the Company shall have
furnished to the Agent (which shall promptly distribute the same to
the Bank), prior to the consummation of such Acquisition, pro forma
projections and other details (with reasonable assumptions and in
form and detail reasonably satisfactory to the Agent) with respect
to the Person or Persons or assets to be acquired and the Company
after giving effect to such Acquisition demonstrating compliance
with the terms of this Agreement;
(c) prior to and after giving effect to such Acquisition, no
Default or Event of Default (including without limitation under the
provisions of Section 7.10) shall have occurred and be continuing,
or would result therefrom, as confirmed in the pro forma projections
referred to in clause (b) above if required to be delivered in
accordance with such clause or, if not so required, in a certificate
of a Responsible Officer delivered to the Agent;
(d) the business of the Person or assets to be acquired
(including blocks of directly related insurance business in the
ordinary course of business) comprises the insurance business (of
the types currently carried on by the Company and its respective
Subsidiaries on the date hereof), and/or is compatible with, and
related to, existing businesses (it being agreed that finance
companies are not so related); and
(e) the total consideration payable in cash in respect of any
one Acquisition constituting a Permitted Acquisition does not exceed
$50,000,000 and the total consideration payable in cash in respect
of all Acquisitions constituting Permitted Acquisitions in any
Fiscal Year does not exceed $75,000,000 in the aggregate;
provided, however, that if the Total Debt to Total Capitalization Ratio as
of the last fiscal quarter on a pro forma basis shall be equal to or less
than 0.300 to 1.0 after giving effect to a proposed Acquisition and the
Company shall deliver to the Agent a certificate demonstrating such ratio,
an Acquisition may be a Permitted Acquisition without meeting the
requirements of clauses (b) or (e) of this definition.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
16
"Plan" means any employee benefit plan maintained or contributed to
by the Company or by any trade or business (whether or not incorporated)
under common control with the Company as defined in Section 4001(b) of
ERISA and insured by the Pension Benefit Guaranty Corporation under Title
IV of ERISA.
"Pounds Sterling" means lawful money of the United Kingdom.
"Primary Investments" means portfolio investments in the ordinary
course of business by the Company or any of its Subsidiaries in any of the
following:
(a) operating deposit accounts maintained in the Company's
name with FDIC member institutions;
(b) Cash Equivalents;
(c) fixed income securities with an investment grade rating
from either Rating Agency; and
(d) shares of investment companies that (i) are registered
under the Investment Company Act of 1940, (ii) invest solely in one
or more of the types without regard to maturity of securities
described in clauses (a) through (g) of the definition of "Cash
Equivalents" and in securities described in clause (c) of this
definition and are not leveraged.
"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at
such time of such Bank's Commitment divided by the combined Commitments of
all Banks.
"Rating Agency" means S&P or Moody's; collectively, the "Rating
Agencies".
"Register" means a register maintained by the Agent of the holders
of the Commitments.
"Regulatory Change" shall mean, with respect to any Bank, any change
after the date hereof in Federal, state or foreign law or regulations or
the adoption or making after such date of any interpretation, directive or
request applying to a class of banks including such Bank of or under any
Federal, state or foreign law or regulations (whether or not having the
force of law and whether or not failure to comply therewith would be
unlawful) by any court or governmental or monetary authority charged with
the interpretation or administration thereof.
"Reinsurance Agreement" means any agreement, contract, treaty or
other arrangement whereby one or more insurers, as reinsurers, assume
liabilities of one or more insurance or reinsurance companies.
17
"Replacement Bank" has the meaning specified in Section 3.7.
"Reportable Event" means any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, a withdrawal from a Plan
described in Section 4063 of ERISA, or a cessation of operations described
in Section 4062(e) of ERISA.
"Required Banks" means at any time Banks then holding in excess of
50% of the then aggregate unpaid principal amount of the Loans, or, if no
such principal amount is then outstanding, Banks then having in excess of
50% of the Commitments.
"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, the
president, the principal financial officer, principal accounting officer,
the treasurer or controller of the Company, or any other officer having
substantially the same authority and responsibility.
"Restricted Payment" means:
(a) the declaration or payment of any dividend or distribution
by the Company or any of its Subsidiaries, either in cash or
property, on any shares of the capital stock of any class of the
Company or any of its Subsidiaries (except dividends or other
distributions payable solely in shares of capital stock of the
Company or any of its Subsidiaries or payable by a Subsidiary to the
Company or another wholly-owned Subsidiary of the Company);
(b) the purchase, redemption or retirement by the Company or
any of its Subsidiaries of any shares of its capital stock of any
class or any warrants, rights or options to purchase or acquire any
shares of its capital stock, whether directly or indirectly;
(c) any other payment or distribution by the Company or any of
its Subsidiaries in respect of its capital stock, either directly or
indirectly; and
(d) the prepayment, repayment, redemption, defeasance or other
acquisition or retirement for value prior to any scheduled maturity,
scheduled repayment or scheduled sinking fund payment, of any
Indebtedness not otherwise permitted under any Loan Document to be
so paid.
"Retrocession Agreement" means any agreement, contract, treaty or
other arrangement whereby one or more insurers or reinsures, as
retrocessionaires, assume
18
liabilities of reinsurers under a Reinsurance Agreement or other
retrocessionaires under another Retrocession Agreement.
"Revolving Termination Date" means the earlier to occur of:
(a) October 30, 2001, as such date may be extended pursuant to
Section 2.15 (as from time to time so extended, the "Scheduled
Revolving Termination Date"); and
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
"SAP" means, as to any insurance company, the statutory accounting
practices prescribed or permitted by the Department, or in the event that
the Department fails to prescribe or address such practices, NAIC
guidelines; provided that if there occurs after the date hereof any change
in SAP that affects in any respect the calculation of any covenant
contained in Section 7.10, the Banks and the Company shall negotiate in
good faith amendments to the provisions of this Agreement that relate to
the calculation of such covenant with the intent of having the respective
positions of the Banks and the Company after such change in SAP conform as
nearly as possible to their respective positions as of the date of this
Agreement and, until any such amendments have been agreed upon, the
covenants in Section 7.10 shall be calculated as if no such change in SAP
has occurred.
"S&P" means Standard & Poor's Ratings Group.
"Scheduled Revolving Termination Date" has the meaning specified in
the definition of "Revolving Termination Date."
"Secondary Investments" means Investments by the Company or any of
its Subsidiaries in the ordinary course of business not constituting
Primary Investments or Acquisitions.
"Senior Debt to Statutory EBIT Ratio" means at any fiscal quarter
end the ratio of the Senior Debt of the Company and its Subsidiaries on a
consolidated basis at such fiscal quarter end to the Statutory EBIT of the
Insurance Subsidiaries on a combined basis for the four fiscal quarter
period then ending.
"Senior Debt" means Total Debt minus Subordinated Debt, on a
consolidated basis.
"Statutory EBIT" means, net earnings before interest expense and tax
expense calculated in accordance with SAP as set forth in column 1, line
29, page 4 in the 1999 Annual Statement.
19
"Subordinated Debt" means the debt on Schedule 1.1 (the "Existing
Subordinated Debt") and any portion of Total Debt subordinated to the
Obligations with covenants and subordination provisions no less favorable
(as reasonably determined by the Administrative Agent) to the Banks than
the Existing Subordinated Debt. The 8.80% monthly income debt securities
due 2025 shall not be considered "Subordinated Debt" for the purpose of
this Agreement.
"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 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. For the purpose of (A) the definitions of
"Contingent Obligation" and "Indebtedness" and any calculations using such
definitions and (B) Sections 5.2, 5.5, 5.6, 5.9, 5.13, 5.15, 5.16, 6.11
8.1(f), 8.1(g) and 8.1(i), D & H shall not be considered a Subsidiary of
the Company.
"Swap Contract" means any agreement 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,
swap option, 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) determinated as the xxxx-to-market value(s) for such Swap
Contract, 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).
"Tangible Net Worth" means, at any time, Net Worth minus intangible
assets, including without limitation, goodwill, the value of business
acquired and deferred acquisition costs.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Total Capitalization" means, at any time, the sum of Net Worth and
Total Debt.
20
"Total Debt" means, at any time, with respect to the Company and its
Subsidiaries, the sum, without duplication, of (a) Applicable Debt at such
time, and (b) non-contingent reimbursement or payment obligations in
respect of the items referred to in clause (c) of the definition of
Indebtedness contained in this Agreement at such time.
"Total Debt to Total Capitalization Ratio" means, at any time, the
ratio of Total Debt to Total Capitalization at such time.
"Type" has the meaning specified in the definition of "Loan."
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Pension 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.
"Voting Stock" means, at any date, the capital stock of any class or
classes of a corporation having general voting power under ordinary
circumstances to elect the board of directors of such corporation
(irrespective of whether or not at the time stock or other securities of
any other class or classes shall have or might have special voting power
or rights by reason of the happening of any contingency).
"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.
1.2 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) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
21
(iii) 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."
(d) 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 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.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this
Agreement.
(f) 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.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the
Company and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Banks or the Agent
merely because of the Agent's or Banks' involvement in their preparation.
1.3 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
2.1 Amounts and Terms of Commitments. Each Bank severally agrees, on the
terms and conditions set forth herein, to make Loans to the Company from time to
time on any Business Day during the period from the Closing Date to the
Revolving Termination Date, in an aggregate amount not to exceed at any time
outstanding the amount set forth on Schedule 2.1 (as the same may be reduced
under Section 2.5, increased under Section 2.14, or reduced or increased as a
result of one or more assignments under Section 10.7, the Bank's "Commitment");
provided, however, that, after
22
giving effect to any Borrowing, the aggregate principal amount of all
outstanding Loans shall not at any time exceed the combined Commitments. Within
the limits of each Bank's Commitment, and subject to the other terms and
conditions hereof, the Company may borrow under this Section 2.1, prepay under
Section 2.6 and reborrow under this Section 2.1.
2.2 Loan Accounts. (a) The Loans made by each Bank shall be evidenced by
one or more loan accounts or records maintained by such Bank in the ordinary
course of business. The loan accounts or records maintained by the Agent and
each Bank shall be conclusive absent manifest error of the amount of the Loans
made by the Banks 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 any Bank made through the Agent, the Loans
made by such Bank may be evidenced by one or more Notes, instead of loan
accounts. Each such Bank shall endorse on the schedules annexed to its
Note(s) 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. Each such Bank is irrevocably authorized by the Company to
endorse its Note(s) and each Bank's record shall be conclusive absent
manifest error; provided, however, that the failure of a 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 such Bank.
2.3 Procedure for Borrowing. (a) Each Borrowing shall be made upon the
Company's irrevocable written notice delivered to the Agent in the form of a
Notice of Borrowing (which notice must be received by the Agent prior to (i)
10:00 a.m. (Charlotte time) three Business Days prior to the requested Borrowing
Date, in the case of Offshore Rate Loans; and (ii) prior to 10:00 a.m. one
Business Day in advance of the requested Borrowing Date, in the case of Base
Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in an
aggregate minimum amount of $5,000,000 or any multiple of $1,000,000
in excess thereof;
(B) the requested Borrowing Date, which shall be a
Business Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to
such Loans included in such notice. 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
three months.
(b) The Agent will promptly notify each Bank of its receipt of any
Notice of Borrowing and of the amount of such Bank's Pro Rata Share of
that Borrowing.
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(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the
Agent's Payment Office by 11:00 a.m. (Charlotte time) on the Borrowing
Date requested by the Company in funds immediately available to the Agent.
The proceeds of all such Loans will then be made available to the Company
by the Agent at such office by crediting the account of the Company on the
books of Bank of America with the aggregate of the amounts made available
to the Agent by the Banks and in like funds as received by the Agent.
(d) After giving effect to any Borrowing, there may not be more than
five (5) different Interest Periods in effect.
2.4 Conversion and Continuation Elections. (a) The Company may, upon
irrevocable written notice to the Agent in accordance with Section 2.4(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 an amount not less than $5,000,000, or that is
in an integral multiple of $1,000,000 in excess thereof) 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 an amount not less than $5,000,000,
or that is in an integral multiple of $1,000,000 in excess thereof);
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.
(b) The Company shall deliver a Notice of Conversion/ Continuation
to be received by the Agent not later than (i) 10:00 a.m. (Charlotte time)
at least (i) 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) one Business Day in advance of the Conversion/Continuation
Date, if the Loans are to be converted into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
renewed;
(C) the Type of Loans resulting from the proposed
conversion or continuation; and
24
(D) other than in the case of Offshore Rate Loans, the
duration of the requested Interest Period.
(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 or 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) The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by
the Company, the Agent will promptly notify each Bank of the details of
any automatic conversion. All conversions and continuations shall be made
ratably according to the respective outstanding principal amounts of the
Loans with respect to which the notice was given held by each Bank.
(e) Unless the Required Banks otherwise agree, during the existence
of a Default or Event of Default, the Company may not elect to have a Loan
converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
there may not be more than five (5) different Interest Periods in effect.
2.5 Voluntary Termination or Reduction of Commitments. The Company may,
upon not less than three Business Days' prior notice to the Agent, terminate the
Commitments, or permanently reduce the Commitments by an aggregate minimum
amount of $5,000,000 or any multiple of $1,000,000 in excess thereof; unless,
after giving effect thereto and to any prepayments of Loans made on the
effective date thereof, the then-outstanding principal amount of the Loans would
exceed the amount of the combined Commitments then in effect. Once reduced in
accordance with this Section, the Commitments may not be increased. Any
reduction of the Commitments shall be applied to each Bank according to its Pro
Rata Share. All accrued commitment fees to, but not including the effective date
of any reduction or termination of Commitments, shall be paid on the effective
date of such reduction or termination.
2.6 Optional Prepayments. Subject to Section 3.4, the Company may, at any
time or from time to time, upon not less than three (3) Business Days'
irrevocable notice to the Agent, ratably prepay Loans in whole or in part, in
minimum amounts of $5,000,000 or any multiple of $1,000,000 in excess thereof.
Such notice of prepayment shall specify the date and amount of such prepayment
and the Type(s) of Loans to be prepaid. The Agent will promptly notify each Bank
of its receipt of any such notice, and of such Bank's Pro Rata Share of such
prepayment. 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 accrued interest to each
such date on the amount prepaid and any amounts required pursuant to Section
3.4.
25
2.7 Repayment. The Company shall repay the Loans on the Revolving
Termination Date.
2.8 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 (i) the Offshore Rate plus the Applicable Amount or (ii) the Base Rate,
as the case may be (and subject to the Company's right to convert to other Types
of Loans under Section 2.4).
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of
Loans under Section 2.6 for the portion of the 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 Agent at
the request or with the consent of the Required Banks.
(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 Loans, at a rate per
annum which is determined by adding 2% per annum to the rate otherwise
applicable to such Loans; 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 2%.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Bank 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 such Bank would be
contrary to the provisions of any law applicable to such Bank limiting the
highest rate of interest that may be lawfully contracted for, charged or
received by such Bank, and in such event the Company shall pay such Bank
interest at the highest rate permitted by applicable law.
2.9 Fees. (a) Arrangement, Agency Fees. The Company shall pay fees to the
Arranger for the Arranger's own account and to the Agent for the Agent's own
account, as required by the letter agreement ("Fee Letter") between the Company
and the Arranger and Agent dated August 31, 2000.
(b) Facility Fees. The Company shall pay to the Agent for the
account of each Bank a facility fee on the average amount of such Bank's
Commitment (irrespective of usage), computed on a quarterly basis in
arrears on the last Business Day of each calendar quarter, equal to the
Applicable Amount per annum. Such facility fee shall accrue from the date
hereof to the Revolving Termination Date and shall be due and payable
quarterly in arrears on the last Business Day of each March, June,
September and December
26
commencing on December 31, 2000 through the Revolving Termination Date,
with the final payment to be made on the Revolving Termination Date;
provided that, in connection with any reduction or termination of
Commitments under Section 2.5, the accrued facility fee calculated for the
period ending on such date shall also be paid on the date of such
reduction or termination, with the following quarterly payment being
calculated on the basis of the period from such reduction or termination
date to such quarterly payment date. The facility 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.
(c) Utilization Fees. The Company shall pay to the Agent for the
account of each Bank a utilization fee on the amount of such Bank's Loans,
during any period in which the aggregate outstanding Loans plus the
outstanding "Loans" under the Other Credit Agreement exceed 50% of the
aggregate amount of the Commitments plus the "Commitments" under the Other
Credit Agreement, 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 Agent, equal to the Applicable Amount
per annum. Such utilization fee shall accrue from the date hereof to the
Revolving Termination Date and shall be due and payable quarterly in
arrears on the last Business Day of each March, June, September and
December commencing on December 31, 2000 through the Revolving Termination
Date, with the final payment to be made on the Revolving Termination Date.
The utilization fees provided in this subsection shall accrue at all times
after the above-mentioned commencement date, including at anytime during
which one or more conditions in Article IV are not met.
2.10 Computation of Fees and Interest. (a) All computations of interest
for Base Rate Loans when the Base Rate is determined by Bank of America's "prime
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 Agent shall be
conclusive and binding on the Company and the Banks in the absence of
manifest error.
2.11 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
Agent for the account of the Banks at the Agent's Payment Office, and shall be
made in dollars and in immediately available funds, no later than 10:00 a.m.
(Charlotte time) on the date specified herein. The Agent will promptly
distribute to each Bank its Pro Rata Share (or other applicable share as
expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than 10:00 a.m. (Charlotte time)
27
shall be deemed to have been received on the following Business Day and any
applicable interest or fee shall continue to accrue.
(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.
(c) Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Banks that the Company will not
make such payment in full as and when required, the Agent may assume that
the Company has made such payment in full to the Agent on such date in
immediately available funds and the Agent may (but shall not be so
required), in reliance upon such assumption, distribute to each Bank on
such due date an amount equal to the amount then due such Bank. If and to
the extent the Company has not made such payment in full to the Agent,
each Bank shall repay to the Agent on demand such amount distributed to
such Bank, together with interest thereon at the Federal Funds Rate for
each day from the date such amount is distributed to such Bank until the
date repaid.
2.12 Payments by the Banks to the Agent. (a) Unless the Agent receives
notice from a Bank on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at least one Business Day prior to the date of
such Borrowing, that such Bank will not make available as and when required
hereunder to the Agent for the account of the Company the amount of that Bank's
Pro Rata Share of the Borrowing, the Agent may assume that each Bank has made
such amount available to the Agent in immediately available funds on the
Borrowing Date and the Agent may (but shall not be so required), in reliance
upon such assumption, make available to the Company on such date a corresponding
amount. If and to the extent any Bank shall not have made its full amount
available to the Agent in immediately available funds and the Agent in such
circumstances has made available to the Company such amount, that Bank shall on
the Business Day following such Borrowing Date make such amount available to the
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Agent submitted to any Bank with respect to amounts
owing under this subsection (a) shall be conclusive, absent manifest error. If
such amount is so made available, such payment to the Agent shall constitute
such Bank's Loan on the date of Borrowing for all purposes of this Agreement. If
such amount is not made available to the Agent on the Business Day following the
Borrowing Date, the Agent will notify the Company of such failure to fund and,
upon demand by the Agent, the Company shall pay such amount to the Agent for the
Agent's account, together with interest thereon for each day elapsed since the
date of such Borrowing, at a rate per annum equal to the interest rate
applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a
Loan on such Borrowing Date, but no Bank shall be responsible for the
failure of any other Bank to make the Loan to be made by such other Bank
on any Borrowing Date.
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2.13 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its Pro Rata Share, such Bank shall
immediately (a) notify the Agent of such fact, and (b) purchase from the other
Banks such participations in the Loans made by them as shall be necessary to
cause such purchasing Bank to share the excess payment pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Company agrees
that any Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 10.9) with respect to such
participation as fully as if such Bank were the direct creditor of the Company
in the amount of such participation. The Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Banks following
any such purchases or repayments.
2.14 Increase of Commitments. The Company may from time to time, by notice
to the Agent, request that the aggregate Commitments be increased by an amount
that will not result in the aggregate Commitments under this Agreement plus the
"Commitments" under the Other Credit Agreement exceeding $1,000,000,000. Each
such notice shall set forth the requested amount of the increase in the
Commitments and the date on which such increase is to become effective. The
Company shall have the right, but not the obligation, to arrange for one or more
commercial banks or other financial institutions (any such bank or other
financial institution being called an "Augmenting Bank"), which may include any
Bank, to extend Commitments or increase their existing Commitments in an
aggregate amount up to, but not greater than, the requested increase, provided
that each Augmenting Bank, if not already a Bank hereunder (i) shall extend a
new Commitment of not less than $10,000,000, (ii) shall execute all such
documentation as the Agent shall specify to evidence its status as a Bank
hereunder and (iii) shall be consented to by the Agent. If (and only if) Banks
(including Augmenting Banks) shall have agreed to increase their aggregate
Commitments or to extend new Commitments in an aggregate amount not less than
$10,000,000 in the aggregate, such increases and such new Commitments shall
become effective on the date agreed to by the Company, the Augmenting Banks and
the Agent. Notwithstanding the foregoing, no increase in the aggregate
Commitments (or in the Commitment of any Bank) shall become effective under this
paragraph unless, on the date of such increase, the conditions set forth in
Section 4.2 shall be satisfied (with all references in such paragraphs to a Loan
being deemed to be references to such increase) and the Agent shall have
received a certificate to that effect dated such date and executed by a
Responsible Officer of the Company.
Upon the effectiveness of any increase pursuant to this Section 2.14 of
the aggregate Commitments and any resulting adjustment in the Pro Rata Share,
the Banks and the Augmenting Banks will purchase from each other and sell to
each other outstanding Loans sufficient to cause the
29
outstanding Loans of each Bank and Augmenting Bank to equal its Pro Rata Share
(as so adjusted) of the aggregate outstanding Loans. Such purchase and sale
shall be made pursuant to Section 10.7 except that no minimum amount shall be
required, no processing fee shall be charged and, if any Bank shall suffer a
loss or incur an expense as a result of the effectiveness of such purchase or
sale being during an Interest Period, the Company shall reimburse such Bank the
amount of such loss or expense. Each such Bank shall furnish the Company with a
certificate setting forth the basis for determining the amount to be paid to it
hereunder.
2.15 Extension of Scheduled Revolving Termination Date. Between 60 and 45
days prior to any Scheduled Revolving Termination Date, the Company may, by
notice to the Agent, request that all Banks extend for 364 additional days the
Scheduled Revolving Termination Date. Such extension so requested shall become
effective if (and only if) on or prior to 30 days after such notice, each Bank
shall have consented in its sole and absolute discretion to such extension in
writing by notice to the Agent. If a Bank (a "Non-Extending Bank") shall in its
sole and absolute discretion not agree to such extension, but Banks holding at
least 66-2/3% of the Commitments shall agree to such extension, the Company may
(a) as to the then Scheduled Revolving Termination Date, terminate the
Commitment of each Non-Extending Bank and pay to the Agent, for the account of
each such Non-Extending Bank, an amount equal to the outstanding principal
balance of Loans held by such Non-Extending Bank, together with accrued and
unpaid interest thereon to the date of such payment, and any accrued and unpaid
fees or other expenses due to such Non-Extending Bank; (b) request one or more
of the other Banks to purchase the Commitment of the Non-Extending Bank; or (c)
with the consent of the Agent (not to be unreasonably withheld), the Company may
request an Eligible Assignee to purchase the Commitment of the Non-Extending
Bank (any such Bank or Eligible Assignee purchasing all or a portion of such
Commitment being called a "Designated Bank"). Any such purchase by a Designated
Bank shall be subject to the terms of Section 10.7.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 Taxes.
(a) Any and all payments by the Company to or for the account of
Agent or any Bank under any Loan Document shall be made free and clear of
and without deduction for any and all present or future taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case
of Agent and any Bank, taxes imposed on or measured by its net income, and
franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the Laws of
which Agent or such Bank, as the case may be, is organized or maintains a
lending office (all such non-excluded taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and
liabilities being hereinafter referred to as "Taxes"). If the Company
shall be required by any Laws to deduct any Taxes from or in respect of
any sum payable under any Loan Document to Agent or any Bank, (i) the sum
30
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable
under this Section), Agent and such Bank receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the
Company shall make such deductions, (iii) the Company shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of
such payment, the Company shall furnish to Agent (who shall forward the
same to such Bank) the original or a certified copy of a receipt
evidencing payment thereof.
(b) In addition, the Company agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property
taxes or charges or similar levies which arise from any payment made under
any Loan Document or from the execution, delivery, performance,
enforcement or registration of, or otherwise with respect to, any Loan
Document (hereinafter referred to as "Other Taxes").
(c) If the Company shall be required by the Laws of any jurisdiction
outside the United States to deduct any Taxes from or in respect of any
sum payable under any Loan Document to Agent or any Bank, the Company
shall also pay to such Bank or Agent (for the account of such Bank), at
the time interest is paid, such additional amount that the respective Bank
specifies as necessary to preserve the after-tax yield (after factoring in
United States (federal and state) taxes imposed on or measured by net
income) such Bank would have received if such deductions (including
deductions applicable to additional sums payable under this Section) had
not been made.
(d) The Company agrees to indemnify Agent and each Bank for the full
amount of Taxes and Other Taxes (including any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this
Section) paid by Agent and such Bank and any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto.
3.2 Illegality. (a) If any 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 any Bank or its applicable Lending Office to make
Offshore Rate Loans, then, on notice thereof by the Bank to the Company through
the Agent, any obligation of that Bank to make Offshore Rate Loans shall be
suspended until the Bank notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
(b) If a 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 such Bank (with a copy to the Agent), prepay in full
such Offshore Rate Loans of that Bank then outstanding, together with
interest accrued thereon and amounts required under Section 3.4, 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
31
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 any Bank to make or maintain Offshore Rate
Loans has been so terminated or suspended, the Company may elect, by
giving notice to the Bank through the Agent that all Loans which would
otherwise be made by the Bank as Offshore Rate Loans shall be instead Base
Rate Loans.
(d) Before giving any notice to the Agent under this Section, the
affected Bank shall designate a different Lending Office with respect to
its Offshore Rate Loans if such designation will avoid the need for giving
such notice or making such demand and will not, in the judgment of the
Bank, be illegal or otherwise disadvantageous to the Bank.
3.3 Increased Costs and Reduction of Return. (a) If any Bank determines
that, due to either (i) the introduction of or any change (other than any change
by way of imposition of or increase in reserve requirements included in the
calculation of the Offshore Rate) in or in the interpretation of any law or
regulation or (ii) the compliance by that 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 such 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 (with a
copy of such demand to be sent to the Agent), pay to the Agent for the account
of such Bank, additional amounts as are sufficient to compensate such Bank for
such increased costs.
(b) Without limiting the effect of the foregoing provisions of this
Section 3.3 (but without duplication), the Company shall pay directly to
each Bank from time to time on request such amounts as such Bank may
determine to be necessary to compensate such Bank (or, without
duplication, the bank holding company of which such Bank is a subsidiary)
for any costs that it determines are attributable to the maintenance by
such Bank (or any applicable lending office or such bank holding company),
pursuant to any law or regulation or any interpretation, directive or
request (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) of any court or governmental or
monetary authority (i) following any Regulatory Change or (ii)
implementing any risk-based capital guideline or other requirement
(whether or not having the force of law and whether or not the failure to
comply therewith would be unlawful) heretofore or hereafter issued by any
government or governmental or supervisory authority implementing at the
national or supra-national level the Basle Accord (including, without
limitation, the Final Risk-Based Capital Guidelines of the Board of
Governors of the Federal Reserve System (12 C.F.R. Part 208, Appendix A;
00 X.X.X. Xxxx 000, Xxxxxxxx X) and the Final Risk-based Capital
Guidelines of the Office of the Comptroller of the Currency (12 C.F.R.
Part 3, Appendix A)), of capital in respect of its Commitment or Loans
(such compensation to include, without limitation, an amount equal to any
reduction of the rate of return on assets or equity of such Bank (or any
applicable lending office or such bank holding
32
company) to a level below that which such Bank (or any applicable lending
office or such bank holding company) could have achieved but for such law,
regulation, interpretation, directive or request).
3.4 Funding Losses. The Company shall reimburse each Bank and hold each
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 2.6;
(d) the prepayment (including pursuant to Section 2.7) 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 automatic conversion under Section 2.4 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 Banks under this Section and
under Section 3.3(a), each Offshore Rate Loan made by a Bank (and each related
reserve, special deposit or similar requirement) shall be conclusively deemed to
have been funded at the Offshore Base Rate 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.
3.5 Inability to Determine Rates. If the Agent 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 Offshore Rate
Loan, or that the Offshore Rate Loan applicable pursuant to Section 2.8(a) for
any requested Interest Period with respect to a proposed Offshore Rate Loan does
not adequately and fairly reflect the cost to any Bank of funding such Loan, the
Agent will promptly so notify the Company and each Bank. Thereafter, the
obligation of the Banks to make or maintain Offshore Rate Loans hereunder shall
be suspended until the Agent 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 Banks 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.
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3.6 Certificates of Banks. Any Bank claiming reimbursement or compensation
under this Article III shall deliver to the Company (with a copy to the Agent) a
certificate setting forth in reasonable detail the amount payable to the Bank
hereunder and such certificate shall be conclusive and binding on the Company in
the absence of manifest error.
3.7 Substitution of Banks. Upon the receipt by the Company from any Bank
(an "Affected Bank") of a claim for compensation under Section 3.3, the Company
may: (i) request the Affected Bank to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Company to acquire
and assume all or a ratable part of all of such Affected Bank's Loans and
Commitment (a "Replacement Bank"); (ii) request one more of the other Banks to
acquire and assume all or part of such Affected Bank's Loans and Commitment; or
(iii) designate a Replacement Bank. Any such designation of a Replacement Bank
under clause (i) or (iii) shall be subject to the prior written consent of the
Agent (which consent shall not be unreasonably withheld); provided, in any case,
that all amounts due under this Agreement to any such Affected Bank shall be
paid in full by the Replacement Bank in respect of outstanding principal and by
the Company in respect of other amounts on or prior to the substitution therefor
of any Replacement Bank.
3.8 Survival. The agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Conditions of Initial Loans. The obligation of each Bank to make its
initial Loan hereunder is subject to the condition that the Agent shall have
received on or before the initial borrowing date all of the following, in form
and substance satisfactory to the Agent and each Bank, and in sufficient copies
for each Bank:
(a) Credit Agreement and Notes. This Agreement and the Notes
executed by each party thereto;
(b) Resolutions; Incumbency.
(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) A certificate of the Secretary or Assistant Secretary of
the Company, certifying the names and true signatures of the
officers of the Company authorized to execute, deliver and perform,
as applicable, this Agreement, and all other Loan Documents to be
delivered by it hereunder;
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(c) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the
bylaws of the Company as in effect on the Closing Date, certified by
the Secretary or Assistant Secretary of the Company as of the
Closing Date; and
(ii) a good standing certificate for the Company from the
Secretary of State (or similar, applicable Governmental Authority)
of its state of incorporation;
(d) Legal Opinion. An opinion of F. Xxxx Xxxxxxxx, Executive Vice
President and General Counsel to the Company and addressed to the Agent
and the Banks, substantially in the form of Exhibit D.
(e) Payment of Fees. Evidence of payment by the Company of all
accrued and unpaid fees (including up-front fees) , costs and expenses to
the extent then due and payable on the Closing Date, together with
Attorney Costs of Bank of America to the extent invoiced prior to or on
the Closing Date, plus such additional amounts of Attorney Costs as shall
constitute Bank of America'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 of America); including any such
costs, fees and expenses arising under or referenced in Sections 2.9 and
10.4;
(f) 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;
(ii) no Default or Event of Default exists or would result
from the initial Borrowing;
(iii) there has occurred since June 30, 2000, no event or
circumstance that has resulted or could reasonably be expected to
result in a Material Adverse Effect; and
(iv) the Credit Agreement dated as of October 29, 1996 among
Unum Corporation, certain banks and Xxxxxx Guaranty Trust Company of
New York has been repaid in full and notice of termination
delivered.
(g) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may request.
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4.2 Conditions to All Borrowings. The obligation of each Bank to make any
Loan to be made by it (including its initial Loan) is subject to the
satisfaction of the following conditions precedent on the relevant Borrowing
Date:
(a) Notice of Borrowing. The Agent shall have received (with, in the
case of the initial Loan only, a copy for each Bank) a Notice of
Borrowing;
(b) Continuation of 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
(c) No Existing Default. No Default or Event of Default shall exist
or shall result from such Borrowing.
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 Section 4.2
are satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Bank that:
5.1 Corporate Existence and Power. The Company and each of its
Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and perform its obligations under the
Loan Documents;
(c) is duly qualified as a foreign corporation and is 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 or license; and
(d) is in compliance with all Requirements of Law;
except, in each case referred to in this Section 5.1, to the extent that the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
36
5.2 Corporate Authorization; No Contravention. The execution, delivery and
performance by the Company of this Agreement and each other Loan Document to
which the Company is party, have been duly authorized by all necessary corporate
action, and do not and will not:
(a) contravene the terms of any of the Company's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which the Company is a party or any order, injunction, writ
or decree of any Governmental Authority to which the Company or its
property is subject; or
(c) violate any Requirement of Law.
5.3 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 the
execution, delivery or performance by, or enforcement against, the Company of
the Agreement or any other Loan Document.
5.4 Binding Effect. This Agreement and each other Loan Document to which
the Company is a party constitute the legal, valid and binding obligations of
the Company, enforceable against the Company 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 the application of equitable principles relating to
enforceability (regardless of whether considered in a proceeding in equity or at
law) including, without limitation (i) the possible unavailability of specific
performance, injunctive relief or any other equitable remedy and (ii) concepts
of materiality, reasonableness, good faith and fair dealing.
5.5 Litigation. Except as in Schedule 5.5, 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, or its Subsidiaries or any of
their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) if adversely determined, could 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 Loan Document, or
directing that the transactions provided for herein or therein not be
consummated as herein or therein provided.
37
5.6 No Default. No Default or Event of Default exists or would result from
the incurring of any Obligations by the Company. As of the Closing Date, 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, if such default had occurred after the Closing Date, create an
Event of Default under Section 8.1(e).
5.7 ERISA Compliance.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the best
knowledge of the Company, nothing has occurred which would prevent, or cause the
loss of, such qualification. The Company and each ERISA Affiliate have made all
required contributions to each 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 the Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that has a Material Adverse Effect. There has been no
prohibited transaction or violation of the fiduciary responsibility rules with
respect to any Plan that has 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
Sections 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 Sections 4069 or 4212(c) of ERISA.
5.8 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 6.12.
Neither the Company nor any Subsidiary is generally engaged in the business of
extending credit for the purpose of purchasing or carrying Margin Stock. No part
of the proceeds of any Loan will be used for purchasing or carrying Margin Stock
or for any purpose which violates, or which would be inconsistent with, the
provisions of Regulations U or X of the FRB.
5.9 Title to Properties.
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(a) Each of the Company and its Subsidiaries has good title to, or
valid leasehold interests in, all its real and personal property material
to its business, subject only to Liens permitted by Section 7.2 and except
for minor defects in title that could not reasonably be expected to have a
Material Adverse Effect.
(b) Each of the Company and its Subsidiaries owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and the use thereof by the
Company and its Subsidiaries does not infringe upon the rights of any
other Person, except for any such infringements that, individually or in
the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.
5.10 Taxes. The Company and its 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 or immaterial taxes; provided, however, that in each case
no material item or portion of property of the Company or any of its
Subsidiaries is in jeopardy of being seized, levied upon or forfeited.
5.11 Financial Condition. (a) The audited consolidated financial
statements of the Company and its Subsidiaries dated December 31, 1999 and the
unaudited consolidated financial statements of the Company and its Subsidiaries
dated June 30, 2000, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal periods ended on
such dates:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly
noted therein, subject in the case of the June 30, 2000 statements
to ordinary, good faith year end audit adjustments;
(ii) fairly present the financial condition of the Company and
its Subsidiaries as of the date thereof and results of operations
for the period covered thereby; and
(iii) show all material indebtedness and other liabilities,
direct or contingent, of the Company and its Subsidiaries as of the
date thereof, including liabilities for taxes, material commitments
and Contingent Obligations.
(b) The financial statements of the Material Insurance Subsidiaries
of the Company, dated December 31, 1999 and June 30, 2000:
39
(i) were prepared in accordance with SAP consistently applied
throughout the period covered thereby, except as otherwise expressly
noted therein; and
(ii) fairly present in all material respects in accordance
with SAP the financial condition of the Insurance Subsidiaries as of
the date thereof and results of operations for the period covered
thereby.
(c) Since December 31, 1999, there has been no Material Adverse
Effect.
5.12 Regulated Entities. Except as listed on Schedule 5.12 hereto, 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.
5.13 No Burdensome Restrictions. 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.
5.14 Subsidiaries. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in Schedule 5.14 hereto.
5.15 Environmental Compliance. The Company and its Subsidiaries conduct in
the ordinary course of business a review of claims alleging potential liability
or responsibility for violation of any Environmental Law on their respective
businesses, operations and properties, and as a result thereof the Company has
reasonably concluded that such Environmental Laws and claims do not,
individually or in the aggregate, have a Material Adverse Effect.
5.16 Insurance. 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.
5.17 Full Disclosure. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Company to the Banks 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
40
of the circumstances under which they are made, not misleading as of the time
when made or delivered.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required Banks
waive compliance in writing:
6.1 Financial Statements. The Company shall deliver to each of the Banks:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Company, a consolidated balance sheet of
the Company and its Subsidiaries as at the end of such fiscal year, and
the related consolidated statements of income and cash flows for such
fiscal year, setting forth in each case in comparative form the figures
for the previous fiscal year, all in reasonable detail, audited and
accompanied by a report and opinion of an independent certified public
accountant of nationally recognized standing, which report and opinion
shall be prepared in accordance with GAAP and shall not be subject to any
qualifications or exceptions as to the scope of the audit nor to any
qualification which is of a "going concern" or similar nature; and
(b) as soon as available, but in any event within 45 days after the
end of each of the first three quarters of each fiscal year of the
Company, a consolidated balance sheet of the Company and its Subsidiaries
as at the end of such fiscal quarter, and the related consolidated
statement of income and cash flows for such fiscal quarter and for the
portion of the Company's fiscal year then ended, setting forth in each
case in comparative form the figures for the corresponding fiscal quarter
of the previous fiscal year and the corresponding portion of the previous
fiscal year then ended, all in reasonable detail and certified by the
principal financial officer or principal accounting officer of the Company
as fairly presenting the financial condition, results of operations and
cash flows of the Company and its Subsidiaries in accordance with GAAP,
subject only to normal year-end adjustments and the absence of footnotes;
(c) as soon as available, but not later than 60 days after the end
of each fiscal year, a copy of the Annual Statement of each Material
Insurance Subsidiary for such fiscal year prepared in accordance with SAP
and accompanied by the certification of the principal financial officer or
principal accounting officer of such Material Insurance Subsidiary that
such Annual Statement presents fairly in accordance with SAP the financial
position of such Material Insurance Subsidiary for the period then ended;
(d) as soon as possible, but no later than 45 days after the end of
each of the first three fiscal quarters of each fiscal year, a copy of the
Interim Statement of each Material
41
Insurance Subsidiary for each such fiscal quarter, all prepared in
accordance with SAP and accompanied by the certification of the principal
financial officer or principal accounting officer of such Insurance
Subsidiary that all such quarterly statements present fairly in accordance
with SAP the financial position of such Insurance Subsidiary for the
period then ended;
(e) within 75 days after the close of each fiscal year, a copy of
each Material Insurance Subsidiary's "Statement of Actuarial Opinion"
which is provided to the Department (or equivalent information should the
Department no longer require such a statement) as to the adequacy of loss
reserves of such Material Insurance Subsidiary, which opinion shall be in
the format prescribed by the Insurance Code; and
(f) as soon as available, a copy of the Management Discussion and
Analysis filed with the Department with respect to any of the foregoing
financial statements and such other information.
6.2 Certificates, Notices and Other Information. The Company shall deliver
to each of the Banks in form and detail reasonably satisfactory to the Agent:
(a) concurrently with the delivery of the financial statements
referred to in Section 6.1(a), a certificate of its independent certified
public accountants certifying such financial statement and stating that in
making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default hereunder or, if any such Default or Event of
Default shall exist, stating the nature and status of such event;
(b) concurrently with the delivery of the financial statements
referred to in Sections 6.1(a) and (b), a duly completed Compliance
Certificate signed by a Responsible Officer of the Company;
(c) promptly after request by Agent or any Bank, copies of any
detailed audit reports, management letters or recommendations submitted to
the board of directors (or the audit committee of the board of directors)
of the Company by independent accountants in connection with the accounts
or books of the Company or any of its Material Subsidiaries, or any audit
of any of them;
(d) promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent
to the stockholders of the Company, and copies of all annual, regular,
periodic and special reports and registration statements which the Company
may file or be required to file with the Securities and Exchange
Commission under Sections 13 or 15(d) of the Securities Exchange Act of
1934, and not otherwise required to be delivered to Agent pursuant hereto;
(e) promptly after the occurrence thereof, notice of any Default or
Event of Default;
42
(f) notice of any material change in accounting policies or
financial reporting practices by the Company or any of its Subsidiaries;
(g) promptly after the commencement thereof, notice of any
litigation, investigation or proceeding affecting the Company any of its
Subsidiaries which may reasonably be expected to have a Material Adverse
Effect;
(h) promptly after the occurrence thereof, notice of any Reportable
Event with respect to any Plan or the intent to terminate any Plan, or the
institution of proceedings or the taking or expected taking of any other
action to terminate any Plan or withdraw from any Plan;
(i) promptly after the occurrence thereof, notice of any Material
Adverse Effect;
(j) promptly, notice of any announcement by any rating agency of any
change or possible change in the Debt Rating by either Rating Agency or in
the "financial strength" rating by either Rating Agency of any Material
Insurance Subsidiary;
(k) the following certificates and other information:
(i) not later than 60 days after received, a copy of any final
financial examination reports or market conduct examination reports
issued by a Governmental Authority with respect to any Material
Insurance Subsidiary of the Company (and the Company, should it at
any time engage or become involved in the business of insurance),
relating to the insurance business of each Material Insurance
Subsidiary or, if applicable, the Company (when, and if, prepared)
and of any and all interim reports;provided that such Material
Insurance Subsidiary or, if applicable, the Company shall not have
to deliver any interim report hereunder if (A) the items described
in such report could not reasonably have a Material Adverse Effect
or (B) a final report is issued and delivered to the Agent within 90
days of such interim report;
(ii) within two Business Days of the receipt of such notice,
notice of the actual suspension, termination or revocation of any
material license of the Company or any of its Material Subsidiaries
by any Governmental Authority or notice from any Governmental
Authority notifying the Company or any of its Material Subsidiaries
of a hearing relating to such a suspension, termination or
revocation, including any request by a Governmental Authority which
commits the Company or any of its Material Subsidiaries to take, or
refrain from taking, any action or which otherwise materially and
adversely affects the authority of the Company or any of its
Material Subsidiaries to conduct its business;
(iii) within two Business Days of the receipt of such notice,
notice of any material pending or threatened investigation or
regulatory proceeding (other than
43
routine periodic investigations or reviews or routine market conduct
reviews) by any Governmental Authority concerning the business
practices or operations of the Company or any of its Material
Subsidiaries; and
(iv) promptly upon the receipt of such notice, notice of any
actual material changes in the Insurance Code governing the
investment or dividend practices of insurance companies domiciled in
any of the states in which any Insurance Subsidiary is domiciled;
(l) promptly upon occurrence, notice of (i) the acquisition by the
Company or any of its Subsidiaries of any Person which engages in any
material respect in an insurance business or (ii) any Subsidiary of the
Company or any of its Subsidiaries becoming engaged in any material
respect in an insurance business; and
(m) promptly, such other data and information as from time to time
may be reasonably requested by Agent, or, through Agent by the Required
Banks.
6.3 Payment of Taxes. The Company shall, and shall cause each of its
Subsidiaries to, pay and discharge when due all taxes, assessments, and
governmental charges, Ordinary Course Liens or levies imposed on any Company or
any of its Subsidiaries or on its income or profits or any of its property,
except for any such tax, assessment, charge, or levy which is an Ordinary Course
Lien under subsection (b) of the definition of such term.
6.4 Preservation of Existence. The Company shall, and shall cause each of
its Subsidiaries to, preserve and maintain its existence, licenses, permits,
rights, franchises and privileges necessary or desirable in the normal conduct
of its business, except where failure to do so does not have a Material Adverse
Effect and except as permitted under Section 7.3.
6.5 Maintenance of Properties. The Company shall, and shall cause each of
its Subsidiaries to, maintain, preserve and protect all of its material
properties and equipment necessary in the operation of its business in good
order and condition, subject to wear and tear in the ordinary course of
business, and not permit any waste of its properties and, except where failure
to do so does not have a Material Adverse Effect.
6.6 Maintenance of Insurance. The Company shall, and shall cause each of
its Subsidiaries to, maintain liability and casualty insurance with responsible
insurance companies in such amounts and against such risks as is customary for
similarly situated businesses; provided, that the Company may in its reasonable
discretion, choose not to have certain Subsidiaries, other than Material
Subsidiaries, carry certain insurance, so long as the failure to carry such
insurance does not have a Material Adverse Effect.
6.7 Compliance With Laws. (a) The Company shall, and shall cause each of
its Subsidiaries to, comply with the requirements of all applicable Laws and
orders of any Governmental Authority, noncompliance with which has a Material
Adverse Effect.
44
(b) The Company shall, and shall cause each of its Subsidiaries to,
conduct its operations and keep and maintain its property in compliance with all
Environmental Laws.
6.8 Inspection Rights. At any time during regular business hours and as
often as reasonably requested, the Company shall, and shall cause each of its
Subsidiaries to, permit the Agent or any Bank, or any employee, agent or
representative thereof, to examine, audit and make copies and abstracts from the
records and books of account of the Company and its Subsidiaries and to visit
and inspect their properties and to discuss their affairs, finances and accounts
with any of their officers and key employees, and, upon request, furnish
promptly to Agent or any Bank true copies of all financial information, provided
that, when a Default or Event of Default exists, the Agent or any Bank may do
any of the foregoing at the expense of the Company at any time during normal
business hours and without advance notice.
6.9 Keeping of Records and Books of Account. The Company shall, and shall
cause each of its Subsidiaries to, keep adequate records and books of account
reflecting all financial transactions in conformity with GAAP, consistently
applied, and in material conformity with all applicable requirements of any
Governmental Authority having regulatory jurisdiction over the Company or any of
its Subsidiaries.
6.10 Compliance with ERISA. The Company shall and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; and (c) make all required contributions to
any Plan subject to Section 412 of the Code.
6.11 Compliance With Agreements. The Company shall, and shall cause each
of its Subsidiaries to, promptly and fully comply with all Contractual
Obligations to which any one or more of them is a party, except for any such
Contractual Obligations (a) the nonperformance of which would not cause a
Default or Event of Default, (b) then being contested by any of them in good
faith by appropriate proceedings, or (c) if the failure to comply therewith does
not have a Material Adverse Effect.
6.12 Use of Proceeds. The Company shall use proceeds of the Loans for
general corporate purposes, including commercial paper back up, not otherwise in
contravention of this Agreement.
ARTICLE VII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Required Banks
waive compliance in writing:
45
7.1 Indebtedness. The Company shall not, and shall not permit any
Subsidiary to, create, incur, assume or suffer to exist any Indebtedness,
except:
(a) Commercial paper, Obligations and "Obligations" under the Other
Credit Agreement aggregating an amount not in excess of $1,000,000,000 at
any time outstanding; and
(b) Indebtedness outstanding on the date hereof and listed on
Schedule 7.1 and any refinancings, refundings, renewals or extensions
thereof, provided that the amount of such Indebtedness is not increased at
the time of such refinancing, refunding, renewal or extension except by an
amount equal to the premium or other amount paid, and fees and expenses
incurred, in connection with such refinancing and by an amount equal to
any utilized commitments thereunder; and provided, further, that the terms
of such refinancing, renewal or refunding shall have covenants, defaults
or other terms and conditions (other than interest rates) no more
restrictive than those contained in this Agreement and, if the
Indebtedness being refinanced is Subordinated Debt, the refinancing
Indebtedness shall be Subordinated Debt with subordination terms at least
as favorable to the Banks as such terms in the refinanced Indebtedness;
and
(c) Ordinary Course Indebtedness; and
(d) Indebtedness in respect of repurchase obligations (including
securities lending and dollar rolls) described in clause(g) of the
definition of "Cash Equivalents" in amounts not in excess of $500,000,000
at any time outstanding; and
(e) Contingent Obligations of the Company with respect to letters of
credit in an amount not in excess of 33,300,000 Pounds Sterling with
respect to which D & H is the account party; and
(f) Additional Contingent Obligations in amounts not in excess of
$50,000,000 at any time outstanding;
provided, that notwithstanding the foregoing the Subsidiaries shall have no
Indebtedness except Indebtedness described in clauses (c) and (d), Indebtedness
payable to the Company and other Wholly-Owned Subsidiaries and other
Indebtedness not to exceed $5,000,000 at any time outstanding; and provided,
further, that no Subsidiary shall have any Contingent Obligations in respect of
Indebtedness of the Company.
7.2 Liens and Negative Pledges. The Company shall not, and shall not
permit any Subsidiary to, incur, assume or suffer to exist, any Lien or Negative
Pledge upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except:
(a) Liens and Negative Pledges existing on the date hereof and
listed on Schedule 7.2 and any renewals or extensions thereof, provided
that the property covered thereby is not
46
increased and any renewal or extension of the obligations secured or
benefitted thereby is permitted by Section 7.1(a);
(b) Ordinary Course Liens;
(c) Liens consisting of pledges or deposits of cash or securities
made by any Insurance Subsidiary as a condition to obtaining or
maintaining any licenses issued to it by, or to satisfy the requirements
of, any Department;
(d) Liens consisting of judgment or judicial attachment Liens (other
than arising as a result of claims under or related to Insurance
Contracts, Retrocession Agreements or Reinsurance Agreements); provided
that the enforcement of such Liens is effectively stayed or fully covered
by insurance and all such liens in the aggregate at any time outstanding
for the Company and its Subsidiaries do not exceed $35,000,000;
(e) Liens arising as a result of claims under or related to
Insurance Contracts, Reinsurance Agreements or Retrocession Agreements in
the ordinary course of business, or securing Indebtedness of Insurance
Subsidiaries incurred or assumed in connection with the settlement of
claim losses in the ordinary course of business of such Insurance
Subsidiaries;
(f) Liens securing Ordinary Course Swap Obligations with Swap
Termination Values not at any time exceeding $200,000,000 in the
aggregate;
(g) Liens on securities securing repurchase agreements (including
securities lending and dollar rolls) with a term of not more than 6 months
and an aggregate purchase price not in excess of $500,000,000;
(h) any extension, renewal or replacement of the foregoing; provided
that the Liens permitted hereby shall not be spread to cover any
additional Indebtedness or property (other than a substitution of like
property); and
(i) Additional Liens on property having a value not in excess of
$50,000,000 and securing Indebtedness not in excess of $50,000,000.
Notwithstanding the foregoing, no Liens shall be permitted on the Equity
Interests of any Subsidiary.
7.3 Consolidations and Mergers; Sales of Assets. The Company shall not,
and shall not allow any of its Subsidiaries to, merge, consolidate with or into,
or convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions) all or any part of its assets (including
receivables and Equity Interests, and in all cases whether now owned or
hereafter acquired) to or in favor of any Person, except:
47
(a) any Subsidiary may merge with the Company (provided that the
Company shall be the continuing or surviving Person), or with any one or
more Subsidiaries (provided that, if a Wholly-Owned Subsidiary is a party
to said merger, a Wholly-Owned Subsidiary shall be the continuing or
surviving Person and if neither Subsidiary party to said merger is a
Wholly-Owned Subsidiary, the Subsidiary of which the Company owns directly
or indirectly the highest percentage shall be the continuing or surviving
Person);
(b) any Subsidiary may sell all or any part of its assets (upon
voluntary liquidation or otherwise) to the Company or another Subsidiary
that is a direct or indirect Wholly-Owned Subsidiary;
(c) the Company or any Subsidiary may sell, lease, convey or
otherwise dispose of assets if such sale, lease, conveyance or other
disposition is (i) of portfolio Investments in the ordinary course of its
business at fair market value, (ii) of obsolete, worn-out or surplus
property, and (iii) a sale of property to the extent such property is
exchanged for credit against the purchase price of similar replacement
property or the net proceeds thereof are applied to the purchase of such
replacement property within 180 days or the Commitments shall be reduced
within 180 days by the amount of such net proceeds and any outstanding
Loans in excess of such reduced Commitments shall be simultaneously
repaid.
(d) the Company or any Subsidiary may merge with another Person, if
the Company or such Subsidiary shall be the surviving Person, to
accomplish a Permitted Acquisition;
(e) the Company or any Insurance Subsidiary may enter into
Reinsurance Agreements in the ordinary course of business, so long as the
net proceeds of any Reinsurance Agreements are reinvested in the business
of the Company and its Subsidiaries within 180 days;
(f) Subsidiaries, other than Material Subsidiaries, may be dissolved
or liquidated; and
(g) other sales of assets at fair market value the proceeds of which
shall not exceed $50,000,000 in any fiscal year so long as the net
proceeds of such sale are reinvested in the business of the Company and
its Subsidiaries within 180 days or the Commitments shall be reduced
within 180 days by the amount of such net proceeds and any outstanding
Loans in excess of such reduced Commitments shall be simultaneously
repaid.
7.4 Loans, Acquisitions and Investments. The Company shall not purchase or
acquire, and shall not allow any of its Subsidiaries to purchase or acquire, or
make any commitment to purchase or acquire, any Equity Interest in, any Person,
or make or commit to make any Acquisitions, or make or commit to make any
advance, loan, extension of credit or capital contribution to or any other
investment in any Person including any Affiliate of the Company (together,
"Investments"), except for:
48
(a) Investments held by the Company or any of its Subsidiaries in
the form of (i) Primary Investments and (ii) so long as no Default or
Event of Default has occurred and is continuing at the time of the making
of such Investment, and after giving effect thereto, Secondary
Investments; provided that, (A) such Investments comply with all Legal
Requirements, and (B) the aggregate amount of Secondary Investments shall
not exceed 30% of the aggregate amount of the Company's aggregate
Investments (with all valuations for purposes of compliance with this
clause (ii) being on a cost basis);
(b) extensions of credit and capital contributions by the Company to
any of its Wholly-Owned Subsidiaries existing on the date hereof or to new
Wholly-Owned Subsidiaries created after the date hereof in accordance with
this Agreement or by any of its Wholly-Owned Subsidiaries to another of
its Wholly-Owned Subsidiaries existing on the date hereof or to new
Wholly-Owned Subsidiaries created after the date hereof in accordance with
this Agreement; provided that additional investments, capital
contributions or extensions of credit made after the date hereof in D&H
shall not exceed $50,000,000 and shall be applied to increase reserves at
D&H;
(c) extensions of credit in the nature of accounts receivable, notes
receivable, lease obligations and similar obligations arising in the
ordinary course of business;
(d) Investments constituting Permitted Acquisitions; and
(e) Investments consisting of non-cash proceeds from dispositions
permitted under Section 7.3.
7.5 Restricted Payments. (a) The Company shall not, and shall not permit
any Subsidiary to, make any Restricted Payments, if before or after giving
effect to any such Restricted Payment a Default or Event of Default shall have
occurred and be continuing.
(b) No payments shall be made on the principal of the $300,000,000
Junior Subordinated Deferrable Interest Debentures, Series A of the
Company due 2038 (the "Junior Subordinated Deferrable Interest
Debentures") or on the Company's guaranty of the Provident Financing Trust
I Capital Securities except from proceeds of Indebtedness issued
concurrently with said payments, subordinated to the Obligations in a form
at least as favorable to the Banks as the Junior Subordinated Deferrable
Interest Debentures and with a term no shorter than the terms of the
Junior Subordinated Deferrable Interest Debentures and a lower cost to the
Company.
7.6 ERISA. The Company shall not, and shall not permit any Subsidiary to,
at any time engage in a transaction which could be subject to Sections 4069 or
4212(c) of ERISA, or permit any Pension Plan to (a) engage in any non-exempt
"prohibited transaction" (as defined in Section 4975 of the Code); (b) fail to
comply with ERISA or any other applicable Laws; or (c) incur any material
"accumulated funding deficiency" (as defined in Section 302 of ERISA), which,
with respect to each event listed above, has a Material Adverse Effect.
49
7.7 Change in Nature of Business. The Company shall not, and shall not
permit any Subsidiary to, make any change in the nature of the business of the
Company and its Subsidiaries taken as a whole as conducted and as proposed to be
conducted as of the date hereof.
7.8 Transactions with Affiliates. The Company shall not, and shall not
allow any of its Subsidiaries to, enter into any transaction with any Affiliate
of the Company, except upon fair and reasonable terms no less favorable to the
Company or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of the Company or such Subsidiary;
7.9 Hostile Acquisitions. The Company shall not use the proceeds of any
Loan in connection with the acquisition of a voting interest of five percent or
more in any Person if such acquisition is opposed by the board of directors or
management of such Person.
7.10 Financial Covenants. (a) The Company shall not permit its Tangible
Net Worth at any time to be less than (i) $1,325,000,000 plus (ii) 25% of
consolidated Net Income (in excess of zero) for any fiscal quarter ending on or
after September 30, 2000.
(b) The Company shall not permit its Total Debt to Total
Capitalization Ratio at any time to be greater than 0.35 to 1.0.
(c) The Company shall not permit its Senior Debt to Statutory EBIT
Ratio to be greater than:
6.0 to 1.0 at any fiscal quarter end from
March 31, 2001 through
December 31, 2001
4.75 to 1.0 at any fiscal quarter end from
March 31, 2002 through
December 31, 2002
4.25 to 1.0 at any fiscal quarter end from
March 31, 2003 through
December 31, 2003
4.0 to 1.0 at fiscal quarter end thereafter
50
ARTICLE VIII
EVENTS OF DEFAULT
8.1 Event of Default. Any of the following shall constitute an
"Event of Default":
(a) Non-Payment. The Company fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan, or (ii) within
three days after the same becomes due, 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 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, 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 Sections 6.1 or 6.2 or in Article
VII; or
(d) Other Defaults. The Company fails to perform or observe any
other term or covenant contained in this Agreement or any other Loan
Document, and such default shall continue unremedied for a period of 30
days after the date upon which written notice thereof is given to the
Company by the Agent or any Bank; or
(e) Cross-Default. The Company or any Subsidiary (i) fails to make
any payment in respect of any Indebtedness having an aggregate principal
amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $10,000,000 when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) and
such failure continues after the applicable grace or notice period, if
any, specified in the relevant document on the date of such failure; or
(ii) fails to perform or observe any other condition or covenant, or any
other event shall occur or condition exist, under any agreement or
instrument relating to any such Indebtedness, and such failure continues
after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure if the effect of such
failure, event or condition is to cause, or to permit the holder or
holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause such Indebtedness to be declared to
be due and payable prior to its stated maturity, or any Contingent
Obligation to become payable or cash collateral in respect thereof to be
demanded; or
51
(f) Insolvency; Voluntary Proceedings. The Company or any 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
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company or any 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
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
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 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
(h) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected
to result in liability of the Company under Title IV of ERISA to the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the $10,000,000; (ii) the aggregate amount of Unfunded Pension
Liability among all Pension Plans at any time exceeds the $10,000,000; or
(iii) the Company or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of the $10,000,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against
the Company or any Subsidiary involving in the aggregate a liability (to
the extent not covered by independent third-party insurance as to which
the insurer does not dispute coverage) as to any single or related series
of transactions, incidents or conditions, of $10,000,000 or more, and the
same shall remain unsatisfied, unvacated and unstayed pending appeal for a
period of 30 days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against the Company or any Subsidiary which does or
would reasonably be expected to have a Material Adverse Effect, and there
shall be any period of 30 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
52
(k) Change of Control. There occurs any Change of Control.
8.2 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Required Banks,
(a) declare the Commitment of each Bank to make Loans to be
terminated, whereupon such Commitments shall be terminated;
(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
(c) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or
applicable law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 8.1 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each 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 Agent or any
Bank.
8.3 Rights Not Exclusive. 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.
ARTICLE IX
THE AGENT
9.1 Appointment and Authorization. Each Bank hereby irrevocably (subject
to Section 9.9) appoints, designates and authorizes the Agent to take such
action on its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere in this Agreement or in any
other Loan Document, the Agent shall not have any duties or responsibilities,
except those expressly set forth herein, nor shall the Agent have or be deemed
to have any fiduciary relationship with any Bank, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Agent.
53
9.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
9.3 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Banks for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Bank to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.
9.4 Reliance by Agent. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to the
Company), independent accountants and other experts selected by the Agent. The
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Required Banks as it deems appropriate and, if it
so requests, it shall first be indemnified to its satisfaction by the Banks
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance with a request or consent of the Required
Banks and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Banks.
9.5 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Agent for the account of the Banks, unless the Agent shall have received
written notice from a Bank or the Company referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". The Agent will notify the Banks of its receipt of any such
notice. The Agent shall take such action with respect to such Default or Event
of Default as may be requested by the Required Banks in accordance with Article
VIII; provided, however, that unless and until the Agent has
54
received any such request, the Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable or in the best interest of the
Banks.
9.6 Credit Decision. Each Bank acknowledges that none of the Agent-Related
Persons has made any representation or warranty to it, and that no act by the
Agent hereinafter taken, including any review of the affairs of the Company and
its Subsidiaries, shall be deemed to constitute any representation or warranty
by any Agent-Related Person to any Bank. Each Bank represents to the Agent that
it has, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company and
its Subsidiaries, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Company hereunder. Each Bank also
represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Company. Except for notices,
reports and other documents expressly herein required to be furnished to the
Banks by the Agent, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of the Company which may come into the possession of any of the
Agent-Related Persons.
9.7 Indemnification. Whether or not the transactions contemplated hereby
are consummated, the Banks shall indemnify upon demand the Agent-Related Persons
(to the extent not reimbursed by or on behalf of the Company and without
limiting the obligation of the Company to do so), pro rata, from and against any
and all Indemnified Liabilities; provided, however, that no Bank shall be liable
for the payment to the Agent-Related Persons of any portion of such Indemnified
Liabilities resulting solely from such Person's gross negligence or willful
misconduct. Without limitation of the foregoing, each Bank shall reimburse the
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or on behalf
of the Company. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Agent.
9.8 Agent in Individual Capacity. Bank of America and its Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though Bank of America were not the Agent
55
hereunder and without notice to or consent of the Banks. The Banks acknowledge
that, pursuant to such activities, Bank of America or its Affiliates may receive
information regarding the Company or its Affiliates (including information that
may be subject to confidentiality obligations in favor of the Company or such
Subsidiary) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, Bank of America
shall have the same rights and powers under this Agreement as any other Bank and
may exercise the same as though it were not the Agent, and the terms "Bank" and
"Banks" include Bank of America in its individual capacity.
9.9 Successor Agent. The Agent may, and at the request of the Required
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Required Banks shall appoint from among the
Banks a successor agent for the Banks. If no successor agent is appointed prior
to the effective date of the resignation of the Agent, the Agent may appoint,
after consulting with the Banks and the Company, a successor agent from among
the Banks. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Article IX and Sections 10.4 and 10.5 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Banks shall perform all of the duties of the Agent hereunder until such
time, if any, as the Required Banks appoint a successor agent as provided for
above.
9.10 Withholding Tax. (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Bank agrees with and in favor of the Agent, to deliver to
the Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, properly completed
IRS Form W-BEN before the payment of any interest in the first
calendar year and before the payment of any interest in each third
succeeding calendar year during which interest may be paid under
this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Bank, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year
of such Bank and in each succeeding taxable year of such Bank during
which interest may be paid under this Agreement;
56
(iii) if such Bank is a foreign partnership or other
intermediary and its partners claim an exemption from, or a
reduction of, withholding tax under a United States tax treaty or if
its partners claim that interest paid under this Agreement is exempt
from United States withholding tax because it is effectively
connected with the conduct with a United States trade or business,
two properly completed and executed copies of IRS Form W-8IMY on or
before the payment of any interest in the first calendar year and
before the payment of any interest in each third succeeding calendar
year during which interest may be paid under this Agreement; and
(iv) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such
Bank sells, assigns, grants a participation in, or otherwise transfers all
or part of the Obligations of the Company to such Bank, such Bank agrees
to notify the Agent of the percentage amount in which it is no longer the
beneficial owner of Obligations of the Company to such Bank. To the extent
of such percentage amount, the Agent will treat such Bank's IRS Form
W-8BEN as no longer valid.
(c) If any Bank claiming exemption from United States withholding
tax by filing IRS Form W-8ECI with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations to
such Bank, such Bank agrees to undertake sole responsibility for complying
with the withholding tax requirements imposed by Sections 1441 and 1442 of
the Code.
(d) If any bank is a foreign partnership or other intermediary and
its partners claim exemption from, or reduction of, withholding tax under
a United States tax treaty by providing IRS Form W-8BEN or its partners
claim exemption from United States withholding tax by filing IRS Form
W-8ECI, and any of its partners sell, assign, grant a participation in, or
otherwise transfer all or part of the Obligations to such Bank, such Bank
agrees to notify the Agent of the percentage amount in which the partner
is no longer the beneficial owner of Obligations to such Bank. To the
extent of such percentage amount, the Administrative Agent will treat such
partner's IRS Form W-8BEN or W-8ECI as no longer valid.
(e) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such
Bank an amount equivalent to the applicable withholding tax after taking
into account such reduction. If the forms or other
57
documentation required by subsection (a) of this Section are not delivered
to the Agent, then the Agent may withhold from any interest payment to
such Bank not providing such forms or other documentation an amount
equivalent to the applicable withholding tax.
(f) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not
properly withhold tax from amounts paid to or for the account of any Bank
(because the appropriate form was not delivered, was not properly
executed, or because such Bank failed to notify the Agent of a change in
circumstances which rendered the exemption from, or reduction of,
withholding tax ineffective, or for any other reason) such Bank shall
indemnify the Agent fully for all amounts paid, directly or indirectly, by
the Agent as tax or otherwise, including penalties and interest, and
including any taxes imposed by any jurisdiction on the amounts payable to
the Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Banks under this
subsection shall survive the payment of all Obligations and the
resignation or replacement of the Agent.
9.11 Documentation Agent; Syndication Agent. None of the Banks identified
on the facing page or signature pages of this Agreement as a "Documentation
Agent" or "Syndication Agent" shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Banks as such. Without limiting the foregoing, none of the
Banks so identified as a "Documentation Agent" or "Syndication Agent" shall have
or be deemed to have any fiduciary relationship with any Bank. Each Bank
acknowledges that it has not relied, and will not rely, on any of the Banks so
identified in deciding to enter into this Agreement or in taking or not taking
action hereunder.
ARTICLE X
MISCELLANEOUS
10.1 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 therefrom, shall be effective unless the same shall be
in writing and signed by the Required Banks (or by the Agent at the written
request of the Required Banks) and the Company and acknowledged by the Agent,
and then any such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
no such waiver, amendment, or consent shall, unless in writing and signed by all
the Banks and the Company and acknowledged by the Agent, do any of the
following:
(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 8.2);
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other
amounts due to the Banks (or
58
any of them) hereunder or under any other Loan Document, it being
understood that a mandatory prepayment date shall not be deemed a date
fixed for payment;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (ii) below) any fees or other
amounts payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Banks or
any of them to take any action hereunder; or
(e) amend this Section, or Section 2.13, or any provision herein
providing for consent or other action by all Banks;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Required Banks or all the
Banks, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (ii) the Fee Letters may be amended,
or rights or privileges thereunder waived, in a writing executed by the parties
thereto.
10.2 Notices. (a) All notices, requests and other communications shall be
in writing (including, unless the context expressly otherwise provides, by
facsimile transmission, provided that any matter transmitted by the Company by
facsimile (i) shall be immediately confirmed by a telephone call to the
recipient at the number specified on Schedule 10.2, and (ii) shall be followed
promptly by delivery of a hard copy original thereof) and mailed, faxed or
delivered, to the address or facsimile number specified for notices on Schedule
10.2; or, as directed to the Company or the Agent, 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 Agent.
(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 third Business Day
after the date deposited into the U.S. mail, or if delivered, upon
delivery; except that notices pursuant to Article II or IX shall not be
effective until actually received by the Agent.
(c) Any agreement of the Agent and the Banks herein to receive
certain notices by telephone or facsimile is solely for the convenience
and at the request of the Company. The Agent and the Banks shall be
entitled to rely on the authority of any Person identifying himself or
herself as a Person who has been identified by the Company to the Agent as
a Person authorized by the Company to give such notice and the Agent and
the Banks shall not have any liability to the Company or other Person on
account of any action taken or not taken by the Agent or the Banks in
reliance upon such telephonic or facsimile notice. The
59
obligation of the Company to repay the Loans shall not be affected in any
way or to any extent by any failure by the Agent and the Banks to receive
written confirmation of any telephonic or facsimile notice or the receipt
by the Agent and the Banks of a confirmation which is at variance with the
terms understood by the Agent and the Banks to be contained in the
telephonic or facsimile notice.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Agent or any 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.
10.4 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Bank of America (including in its capacity
as Agent) within five Business Days after demand (subject to Section
4.1(e)) for all costs and expenses incurred by Bank of America (including
in its capacity as Agent) in connection with the development, preparation,
delivery, 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 the consummation of the transactions
contemplated hereby and thereby, including reasonable Attorney Costs
incurred by Bank of America (including in its capacity as Agent) with
respect thereto; and
(b) pay or reimburse the Agent, the Arranger and each Bank within
five Business Days after demand (subject to Section 4.1(e)) for all costs
and expenses (including Attorney Costs) incurred by them 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).
10.5 Indemnity. Whether or not the transactions contemplated hereby are
consummated, the Company shall indemnify and hold the Agent-Related Persons, and
each Bank 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, 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 and the
termination, resignation or replacement of the Agent or replacement of any Bank)
be imposed on, incurred by or asserted against any such Indemnified Person in
any way relating to or arising out of this Agreement or any document
contemplated by or referred to herein, or the transactions contemplated hereby,
or any action taken or omitted by any such Indemnified Person under or in
connection with any of the foregoing,
60
including with respect to any investigation, litigation or proceeding (including
any Insolvency Proceeding or appellate proceeding) related to or arising out of
this Agreement or the Loans or the use of the proceeds thereof, 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
resulting solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
10.6 Payments Set Aside. To the extent that the Company makes a payment to
the Agent or the Banks, or the Agent or the Banks exercise their 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
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any Insolvency Proceeding or otherwise, then (a)
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, and (b)
each Bank severally agrees to pay to the Agent upon demand its pro rata share of
any amount so recovered from or repaid by the Agent.
10.7 Binding Effect; Assignment.
(a) This Agreement and the other Loan Documents to which the Company is a
party will be binding upon and inure to the benefit of the Company, the Agent,
the Banks and their respective successors and assigns, except that, the Company
may not assign its rights hereunder or thereunder or any interest herein or
therein without the prior written consent of all the Banks and any such
attempted assignment shall be void. Any Bank may at any time pledge its Note or
any other instrument evidencing its rights as a Bank under this Agreement to a
Federal Reserve Bank (without the consent of or notice to the Agent or the
Company), but no such pledge shall release that Bank from its obligations
hereunder or grant to such Federal Reserve Bank the rights of a Bank hereunder
absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Bank may assign to
one or more Eligible Assignees all or any portion of its Pro Rata Share of its
Commitment and/or Loans; provided that (i) such assignment, if not to a Bank or
an Affiliate of the assigning Bank, requires the consent in advance of the
Company at all times other than during the existence of a Default or Event of
Default and the Agent (which approval of the Company and the Agent shall not be
unreasonably withheld or delayed), (ii) a copy of a duly signed and completed
Notice of Assignment and Acceptance shall be delivered to Agent, (iii) except in
the case of an assignment to an Affiliate of the assigning Bank, to another Bank
or of the entire remaining Commitment of the assigning Bank, the assignment
shall not assign a Pro Rata Share equivalent to less than the $1,000,000, and
(iv) the effective date of any such assignment shall be as specified in the
Notice of Assignment and Acceptance, but not earlier than the date which is five
Business Days after the date the Agent has received the Notice of Assignment and
Acceptance. Upon acceptance by the Agent of such Notice of Assignment and
Acceptance and consent thereto by Agent and the Company, if required, and
61
payment of the requisite fee described below, the Eligible Assignee named
therein shall be a Bank for all purposes of this Agreement, with the Pro Rata
Share therein set forth and, to the extent of such Pro Rata Share, the assigning
Bank shall be released from its further obligations under this Agreement. The
Company agrees that it shall execute and deliver upon request (against delivery
by the assigning Bank to the Company of any Note) to such assignee Bank, one or
more Notes evidencing that assignee Bank's Pro Rata Share, and to the assigning
Bank if requested, one or more Notes evidencing the remaining balance Pro Rata
Share retained by the assigning Bank. The Agent's consent to and acceptance of
any assignment shall not be deemed to constitute any representation or warranty
by any Agent-Related Person as to any matter. The Agent shall record the
information contained in the Notice of Assignment and Acceptance in the
Register.
(c) After receipt of a completed Notice of Assignment and Acceptance, and
receipt of an assignment fee of $3,500 from the assigning Bank (including
Affiliates of assigning Banks), Agent shall, promptly following the effective
date thereof, provide to the Company and the Banks a revised Schedule 10.2
giving effect thereto.
(d) Each Bank may from time to time, without the consent of any other
Person, grant participations to one or more other Person (including another
Bank) all or any portion of its Pro Rata Share of its Commitment and/or Loans;
provided, however, that (i) such Bank's obligations under this Agreement shall
remain unchanged, (ii) such Bank shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the participating
banks or other financial institutions shall not be a Bank hereunder for any
purpose except, if the participation agreement so provides, for the purposes of
Article III (but only to the extent that the cost of such benefits to the
Company does not exceed the cost which the Company would have incurred in
respect of such Bank absent the participation) and subject to Sections 2.13 and
10.9, (iv) the Company, the Agent and the other Banks shall continue to deal
solely and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement, (v) the participation shall not restrict an
increase in the Commitment or in granting Bank's Pro Rata Share, so long as the
amount of the participation interest is not affected thereby, and (vi) the
consent of the holder of such participation interest shall not be required for
amendments or waivers of provisions of the Loan Documents; provided, however,
that the assigning Bank may, in any agreement with a participant, give such
participant the right to consent to any matter which (A) extends the Revolving
Termination Date as to such participant or any other date upon which any payment
of money is due to such participant, (B) reduces the rate of interest owing to
such participant, any fee or any other monetary amount owing to such
participant, or (C) reduces the amount of any installment of principal owing to
such participant.
10.8 Confidentiality. Each Bank agrees to maintain the confidentiality of
information provided to it by the Company or any Subsidiary, or by the Agent on
such Company's or 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 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,
62
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 the Bank; provided, however, that any 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 Agent, any
Bank or their respective 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 such Bank's independent auditors 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 Banks hereunder; (H) as to any
Bank or its Affiliate, 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.
10.9 Set-off. In addition to any rights and remedies of the Banks provided
by law, if an Event of Default exists or the Loans have been accelerated, each
Bank is authorized at any time and from time to time, without prior notice or
demand to the Company, any such notice or demand 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, such Bank to or for the credit or
the account of the Company against any and all Obligations owing to such Bank,
now or hereafter existing, irrespective of whether or not the Agent or such Bank
shall have made demand under this Agreement or any Loan Document and although
such Obligations may be contingent or unmatured. Each Bank agrees promptly to
notify the Company and the Agent after any such set-off and application made by
such Bank; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application.
10.10 Notification of Addresses, Lending Offices, Etc. Each Bank shall
notify the Agent in writing of any changes in the address to which notices to
the Bank should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
10.11 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.
10.12 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.
63
10.13 No Third Parties Benefitted. This Agreement is made and entered into
for the sole protection and legal benefit of the Company, the Banks, the Agent
and the Agent-Related Persons, and their permitted successors and 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.
10.14 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK; PROVIDED THAT THE AGENT AND THE BANKS 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, EACH OF THE COMPANY, THE AGENT
AND THE BANKS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT
AND THE BANKS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO
THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH
IT 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. THE COMPANY, THE AGENT AND THE BANKS EACH WAIVE PERSONAL SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER
MEANS PERMITTED BY NEW YORK LAW.
10.15 Waiver of Jury Trial. THE COMPANY, THE BANKS AND THE AGENT 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 AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
BANKS AND THE AGENT 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.
64
10.16 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Banks and the Agent, and supersedes all prior or contemporaneous agreements
and understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof.
65
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
UNUMPROVIDENT CORPORATION
By:____________________________________
Title:_________________________________
S-1 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
BANK OF AMERICA, N.A., as Administrative
Agent and as a Bank
By:____________________________________
Title:_________________________________
S-2 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
CITICORP USA, INC.
By:____________________________________
Title:_________________________________
S-3 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
WACHOVIA BANK, N.A.
By:____________________________________
Title:_________________________________
S-4 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
FLEET NATIONAL BANK
By:____________________________________
Title:_________________________________
S-5 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
BANK ONE, NA
By:____________________________________
Title:_________________________________
S-6 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
THE CHASE MANHATTAN BANK
By:____________________________________
Title:_________________________________
S-7 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
By:______________________________________
Title:___________________________________
S-8 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
AMSOUTH BANK
By:____________________________________
Title:_________________________________
S-9 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By:____________________________________
Title:_________________________________
S-10 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
THE DAI - ICHI KANGYO BANK, LTD
By:____________________________________
Title:_________________________________
S-11 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
LLOYDS TBS BANK PLC
By:____________________________________
Title:_________________________________
S-12 364-Day Credit Agreement
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their proper and duly authorized officers as of the day and
year first above written.
STATE STREET BANK AND TRUST COMPANY
By:____________________________________
Title:_________________________________
S-13 364-Day Credit Agreement
SCHEDULE 2.1
364-DAY CREDIT AGREEMENT
COMMITMENTS
AND PRO RATA SHARES
Pro Rata
Bank Commitment Share
---- ---------------------
BANK OF AMERICA,N.A. $62,500,000 13.5135135%
CITICORP USA,Inc. $62,500,000 13.0000000%
WACHOVIA BANK, N.A. $62,500,000 13.5135135%
FLEET NATIONAL BANK,N.A. $50,000,000 10.0000000%
BANK ONE, NA $37,500,000 8.1081081 %
THE CHASE MANHATTAN BANK $37,500,000 8.1081081 %
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK $37,500,000 8.0000000 %
AMSOUTH BANK $25,000,000 5.0000000 %
BANK OF TOKYO - MITSUBISHI
TRUST COMPANY $25,000,000 5.4054054 %
THE DAI-ICHI KANGYO BANK, LTD $25,000,000 5.4054054 %
LLOYDS TBS BANK PLC $25,000,000 5.4054054 %
STATE STREET BANK AND
TRUST COMPANY $12,500,000 2.7027027 %
TOTAL $462,500,000 100 %
Schedule 2.1, Page 1 364-Day Credit Agreement
SCHEDULE 5.5
In 1997 two alleged class action lawsuits were filed in September Court in
Worcester, Massachusetts (Superior Court) against the Company - one purporting
to represent all career agents of subsidiaries of The Xxxx Xxxxxx Corporation
(Xxxx Xxxxxx) whose employment relationships ended on June 30, 1997 and were
offered contracts to sell insurance policies as independent producers and the
other purporting to represent independent brokers who sold certain Xxxx Xxxxxx
individuals disability income policies with benefit riders. Motions filed by the
Company to dismiss most of the counts in the complaints, which allege various
breach of contract and statutory claims, have been denied, but these cases
remain at a preliminary stage. A hearing to determine class certification was
heard on December 20, 1999 in Massachusetts state court. The court certified a
class for the independent brokers and has denied class certification for the
career agents. The Company appealed the class certification for the independent
brokers, but the appeal was denied. A tentative trial date of January 2001 has
been set. The Company has filed a conditional counterclaim in each action which
requests a substantial return on commissions should the Superior Court agree
with the plaintiffs' interpretation of the contracts. The Company has received
notice that career agent plaintiffs plat to re-file their class action and limit
it solely to the issues in the certified broker class action. The Company
believes that it has strong defenses both lawsuits and plans to vigorously
defend its position.
In addition, the same plaintiffs' attorney who has filed the purported class
action lawsuits has filed 47 individual lawsuits on behalf of current and former
Xxxx Xxxxxx sales managers alleging various breach of contract claims. The
Company has filed a motion in federal court to compel arbitration for 17 of the
plaintiffs who are licensed by the National Association of Securities Dealers
and have executed the Uniform Application for Registration or Transfer in the
Securities Industry (Form U-4). The federal court has denied 15 of those motions
and granted two. The Company is appealing the denial of the 15 motions, and a
hearing before the First Circuit Court of Appeals was held on August 1, 2000.
The Company believes that it has strong defenses and plans to vigorously defend
its position in these cases. Although the alleged class action lawsuits and
individual lawsuits described above are in the early stages, management does not
currently expect these suits to materially affect the financial position or
results of operations of the Company.
During September and October 1999, the company and several of its officers were
named as defendants in five class action lawsuits filed in the United States
District Court for the District of Maine. On January 3, 2000, the Maine district
court appointed a lead class action plaintiff and ordered plaintiffs to file a
consolidated amended complaint. On January 27, 2000, a sixth complaint against
the same defendants was filed in the Southern District of New York. On March 7,
2000, the sixth action was transferred to the District of Maine, and that action
was voluntarily dismissed by the plaintiff on June 12, 2000. On February 23,
2000, two consolidated amended class action complaints asserts a variety of
claims under the Securities Exchange Act of 1934, as amended on behalf of a
putative class of shareholders who purchased or otherwise acquired stock in the
Company or Unum between February 4, 1998 and February 9, 2000. The second
amended complaint asserts a variety of claims under the Securities Act of 1933
and the
Schedule 5.5, Page 1
Securities Exchange Act of 1934, as amended, on behalf of a putative class of
shareholders who exchanged the common stock of Unum or Provident for the
Company's stock pursuant to the joint proxy/registration statement issued in
connection with the merger between Unum and Provident. The complaints allege
that the defendants made false and misleading public statements concerning,
among other things, Unum's and the Company's reserves for disability insurance
and pricing policies, the Company's merger costs, and the adequacy of the due
diligence reviews performed in connection with the merger. The complaints seek
money damages on behalf of all persons who purchased or otherwise acquired
Company and Unum stock in the class period or who were issued Company stock
pursuant to the merger. On April 10, 2000, the defendants filed a motion to
dismiss the complaints. The motion was fully submitted on June 20, 2000, but no
decision has yet been rendered by the court. To date, no class has been
certified, and no defendant has answered any complaint. The Company disputes the
claims alleged in the complaint and plans to vigorously contest them.
In certain reinsurance pools associated with the Company's reinsurance
businesses there are disputes among the pool members and reinsurance
participants concerning the scope of their obligations and liabilities within
the complex pool arrangements, including pools for which subsidiaries of the
Company acted either as pool managers or underwriting agents, as pool member or
reinsurers of the pools in the process of resolving the various claims, but it
is unclear what exposure the Company or its subsidiaries may ultimately have to
share in the losses of pool members or reinsurers because of the subsidiaries'
activities in placing insurance or otherwise.
Various other lawsuits against the Company have arisen in the normal course of
its business. Contingent liabilities that might arise from such other litigation
are not deemed likely to materially affect the financial position or results of
operations of the Company.
Schedule 5.5, Page 2
SCHEDULE 5.12
The following Regulated Entities, namely Investment Companies within the meaning
of the Investment Company Act of 1940 are list pursuant to Section 5.12 of the
Agreement:
1. Provident National Assurance Company, Separate Account B (variable
annuity account, no new contract sales)
2. Xxxx Xxxxxx Variable Annuity Insurance Company, Contract
Accumulation Fund (variable annuity account, no new contract sales)
Schedule 5.12, Page 1
SCHEDULE 5.14
Subsidiaries
The attached organization chart shows the Subsidiaries of the Company.
Schedule 5.14, Page 1
SCHEDULE 10.2
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK OF AMERICA, N.A.,
as Agent
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxxx X. X. Xxxxxx
BANK OF AMERICA, N.A.
as a Bank
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxxx X. X. Xxxxxx
Domestic and Offshore Lending Office:
Bank of America Plaza
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxx Xxxxx-Xxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 000000
Attention: Xxxxxxxxx X. X. Xxxxxx
CITICORP U.S.A, INC.
as a Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
Domestic and Offshore Lending Office:
Schedule 10.2, Page 1
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
WACHOVIA BANK, N.A.
as a Bank
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxx
Domestic and Offshore Lending Office:
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxx
THE CHASE MANHATTAN BANK
as a Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
Domestic and Offshore Lending Office:
Xxx Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Schedule 10.2, Page 2
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
FLEET NATIONAL BANK
as a Bank
Financial Institutions
000 Xxxxxxx Xxxxxx - XX XX 00000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Domestic Lending Office:
Financial Institutions
000 Xxxxxxx Xxxxxx - XX XX 00000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
Offshore Lending Office:
Financial Institutions
000 Xxxx Xxxxxx - XX XX 00000X
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx XxXxxxxxx or Xxxx Xxxxxx
Phone: 000-000-0000 or 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
Financial Institutions
000 Xxxxxxx Xxxxxx - XX XX 00000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Schedule 10.2, Page 3
BANK ONE, NA
as a Bank
0 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxx
Domestic and Offshore Lending Office:
0 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xx Xxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
0 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxx
BANK OF TOKYO - MITSUBISHI TRUST COMPANY
as a Bank
1251 Avenue of the Americas, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxx
Domestic and Offshore Lending Office:
1251 Avenue of the Americas, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx Xx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
1251 Avenue of the Americas, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxx
Schedule 10.2, Page 4
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK
as a Bank
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx Dell'Aquila
Domestic Lending Office:
Xxxxxx Guaranty Trust Company of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Offshore Lending Office:
c/o X.X. Xxxxxx Services, Inc.
000 Xxxxxxx Xxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxxx Phone:
000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx Dell'Aquila
AMSOUTH BANK
as a Bank
000 Xxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxx
Domestic and Offshore Lending Office:
000 Xxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Schedule 10.2, Page 5
Conversion/Continuation):
000 Xxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxx
THE DAI - ICHI KANGYO BANK, LTD
as a Bank
One World Trade Center - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Domestic and Offshore Lending Office:
One World Trade Center - 48th Floor
New York, New York 10048
Attention: Xxxxx Xxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
Xxx Xxxxx Xxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx
LLOYDS TBS BANK PLC
as a Bank
One Biscayne Tower, Suite 3200
0 Xxxxx Xxxxxxxx Xxxx.
Xxxxx, Xxxxxxx 00000
Domestic and Offshore Lending Office:
One Biscayne Tower, Suite 3200
0 Xxxxx Xxxxxxxx Xxxx.
Xxxxx, Xxxxxxx 00000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
Schedule 10.2, Page 6
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxx
STATE STREET BANK AND TRUST COMPANY
as a Bank
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Domestic and Offshore Lending Office:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
Lafayette Corporate Center
0 Xxxxxx xx Xxxxxxxxx
Xxxxxx Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Schedule 10.2, Page 7
EXHIBIT A
NOTICE OF BORROWING
Date: ___________, 200_
To: Bank of America, N.A., as Administrative Agent for the Banks parties to
the 364-Day Credit Agreement dated as of October ___, 2000 (as extended,
renewed, amended or restated from time to time, the "Credit Agreement")
among UnumProvident Corporation, certain Banks which are signatories
thereto, Citicorp USA, Inc. and Wachovia Bank, N.A., as Co-Syndication
Agents, Fleet National Bank, as Documentation Agent and Bank of America,
N.A., as Administrative Agent
Ladies and Gentlemen:
The undersigned, UnumProvident Corporation (the "Company"), refers to the
Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.3 of the
Credit Agreement, of the Borrowing specified below:
1. The Business Day of the proposed Borrowing is ___________, 200_.
2. The aggregate amount of the proposed Borrowing is $_____________.
3. The Borrowing is to be comprised of $_________ of [Base Rate]
[Offshore Rate] Loans.
4. The duration of the Interest Period for the Offshore Rate Loans
included in the Borrowing shall be _____ months.
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the proposed Borrowing, before
and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of the Company contained in
Article V of the Credit Agreement are true and correct as though made on
and as of such date (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and
correct as of such date); and
Exhibit A-1
(b) no Default or Event of Default has occurred and is continuing,
or would result from such proposed Borrowing.
UNUMPROVIDENT CORPORATION
By:____________________________________
Title:_________________________________
Exhibit A-2
EXHIBIT B
NOTICE OF CONVERSION/CONTINUATION
Date: ______, 200_
To: Bank of America National, N.A., as Administrative Agent for the Banks
parties to the 364-Day Credit Agreement dated as of October ____, 2000 (as
extended, renewed, amended or restated from time to time, the "Credit
Agreement") among UnumProvident Corporation, certain Banks which are
signatories thereto, Citicorp USA, Inc. and Wachovia Bank, N.A., as
Co-Syndication Agents, Fleet National Bank, as Documentation Agent and
Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
The undersigned, UnumProvident Corporation (the "Company"), refers to the
Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.4 of the
Credit Agreement, of the [conversion] [continuation] of the Loans specified
herein, that:
1. The Conversion/Continuation Date is ______, 200_.
2. The aggregate amount of the Loans to be [converted] [continued]
is $___________.
3. The Loans are to be [converted into] [continued as][Offshore
Rate] [Base Rate] Loans.
4. [If applicable:] The duration of the Interest Period for the
Loans included in the [conversion] [continuation] shall be [___ months].
UNUMPROVIDENT CORPORATION
By:____________________________________
Title:_________________________________
Exhibit B-1
EXHIBIT C
UNUMPROVIDENT CORPORATION
COMPLIANCE CERTIFICATE
Financial Statement Date: __________, 200_
Reference is made to that certain 364-Day Credit Agreement dated as of
October , 2000 (as extended, renewed, amended or restated from time to time, the
"Credit Agreement") among UnumProvident Corporation, (the "Company"), the
several financial institutions from time to time parties to the Credit Agreement
(the "Banks"), Citicorp USA, Inc. and Wachovia Bank, N.A., as Co-Syndication
Agents, Fleet National Bank, as Documentation Agent and Bank of America, N.A.,
as Administrative Agent for the Banks (in such capacity, the "Agent"). Unless
otherwise defined herein, capitalized terms used herein have the respective
meanings assigned to them in the Credit Agreement.
The undersigned Responsible Officer of UnumProvident Corporation, hereby
certifies as of the date hereof that he/she is the ________ of the Company, and
that, as such, he/she is authorized to execute and deliver this Certificate to
the Banks and the Agent on the behalf of the Company and its consolidated
Subsidiaries, and that:
1. The undersigned has reviewed and is familiar with the terms of the
Credit Agreement and has made, or has caused to be made under his/her
supervision, a detailed review of the transactions and conditions (financial or
otherwise) of the Company during the accounting period covered by the attached
financial statements.
2. To the best of the undersigned's knowledge, the Company, during such
period, has observed, performed or satisfied all of its covenants and other
agreements, and satisfied every condition in the Credit Agreement to be
observed, performed or satisfied by the Company, and the undersigned has no
knowledge of any Default or Event of Default.
3. The following financial covenant analyses and information set forth on
Schedule 1 attached hereto are true and accurate on and as of the date of this
Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of ,
2000.
UNUMPROVIDENT CORPORATION
By:____________________________________
Title:_________________________________
Exhibit C-1
Schedule 1
Section 7.10(a)
---------------
A. [$__________] [Required Tangible Net Worth $______________
from prior fiscal quarter/year]
B. Net Income $______________
C. 25% of Item B $______________
D. Required Tangible Net Worth (Items A plus C $______________
[plus D])
E. Net Worth $______________
less: Goodwill $___________
Value of Business Acquired $___________
Deferred Acquisition Costs $___________
F. Actual Tangible Net Worth $______________
Section 7.10(b)
---------------
A. Total Debt $______________
B. Net Worth $______________
C. Total Capitalization (Items A plus B) $______________
D. Ratio (Item A to Item C) to 1.0
---------------
E. Required Ratio 0.35 to 10
---------------
Section 7.10(c)
---------------
A. Total Debt $______________
B. Subordinated Debt $______________
C. Senior Debt (Item A minus Item B) $______________
D. Combined Statutory Net earnings $______________
E. Combined Statutory Interest expense $______________
F. Combined Statutory Tax expense $______________
G. Statutory EBIT (Items D plus E plus F) $______________
H. Ratio (Item C to Item G) _____to 1.0
I. Required Ratio _____to 1.0
Exhibit D-2
EXHIBIT D
[[FORM OF] OPINION OF BORROWER'S COUNSEL
October ___, 2000
Bank of America, N.A.,
as Administrative Agent
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Re: UnumProvident Corporation
Ladies and Gentlemen:
I am Executive Vice President, Assistant Secretary and General Counsel of
UnumProvident Corporation, a Delaware corporation (the "Company"). This opinion
is delivered to you pursuant to Section 4.1(d) of that certain 364-Day Credit
Agreement dated as of October , 2000 (the "Credit Agreement") among the Company,
certain lenders (collectively, the "Banks"), Citicorp USA, Inc. and Wachovia
Bank, N.A., as Co-Syndication Agents, Fleet National Bank, as Documentation
Agent and Bank of America, N.A., as Administrative Agent for the Banks (in such
capacity, the "Agent"). Capitalized terms used herein, but not otherwise defined
herein, shall have the meanings ascribed to such terms in the Credit Agreement.
In rendering the opinions set forth herein, I have examined and/or relied
upon (i) the Company's certificate of incorporation and bylaws; (ii)
certificates of public officials and officers and representatives of the Company
(iii) resolutions of the board of directors of the Company with respect to the
transactions referred to herein; (iv) the Credit Agreement; and (v) such other
agreements, instruments and documents, and such questions of law as I have
deemed necessary or appropriate to enable me to render the opinions expressed
below. I also have made such inquiries of officers, representatives and
attorneys in the legal department of the Company as I have deemed relevant or
necessary for purposes of the opinions set forth herein.
In rendering the opinions expressed below, I have, with your consent,
assumed that the signatures of persons signing all documents in connection with
which this opinion is rendered are genuine, all documents submitted to me as
originals or duplicate originals are authentic and all documents submitted to me
as copies, whether certified or not, conform to authentic original documents.
Based upon the foregoing and subject to the qualifications stated herein,
I am of the opinion that:
Exhibit D-1
1. The Company is validly existing in the state of its organization and
has the requisite power and authority to own and hold under lease its
properties, to conduct its business as presently conducted and to execute and
deliver the Credit Agreement.
2. The Company is duly qualified and in good standing in each state where
the nature of its business and properties makes such qualification necessary,
except to the extent that the failure to be so qualified or to be in good
standing would not have a material averse effect on the Company's consolidated
financial condition or business.
3. The execution, delivery and performance of the Credit Agreement has
been duly authorized by the Company, and the Credit Agreement constitutes the
valid and binding obligation of the Company enforceable in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors' rights
generally or by the application of equitable principles relating to
enforceability (regardless of whether considered in a proceeding in equity or at
law) including, without limitation (i) the possible unavailability of specific
performance, injunctive relief or any other equitable remedy and (ii) concepts
of materiality, reasonableness, good faith and fair dealing.
4. Assuming the proceeds of the loans are used solely for the purposes set
forth in the Credit Agreement, neither the execution and delivery by the Company
of the Credit Agreement, nor the consummation by the Company of the transactions
contemplated thereby: (i) violates any provision of the Company's certificate of
incorporation or bylaws; (ii) violates any law or regulation (including any
applicable order or decree of any court or governmental instrumentality known to
me) applicable to the Company; (iii) results in the breach of, or constitutes a
default under, any material agreement binding on the Company or any of its
Subsidiaries; (iv) results in the creation or imposition of any lien upon any of
the property of the Company or any of its Subsidiaries under any agreement
described in clause (iii) above; or (v) requires the consent or approval of, or
any filing or registration with, any governmental body, agency or authority,
provided that for purposes of (iii) and (iv) herein, no opinion is offered or
provided with respect to D & H.
5. To our knowledge, except as disclosed in the Credit Agreement, there
are no judgments outstanding against the Company or any of its Subsidiaries
which would have a material adverse effect on the Company's consolidated
financial condition or business.
This opinion is solely for the benefit of the addressee hereof and the
Banks under the Credit Agreement in connection with the execution and delivery
of the Credit Agreement. This opinion may not be relied upon in any manner by
any other person and may not be disclosed, quoted, filed with a governmental
agency or otherwise referred to without our prior written consent.
Very truly yours,
Exhibit D-2
EXHIBIT E
FORM OF NOTICE OF ASSIGNMENT AND ACCEPTANCE
__________, 200_
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain 364-Day Credit Agreement dated as
of October __, 2000 between UnumProvident Corporation (the "Company"),
lenders from time to time party thereto, Citicorp USA, Inc. and Wachovia
Bank, N.A., as Co-Syndication Agents, Fleet National Bank, as
Documentation Agent and Bank of America, N.A., as Administrative Agent (as
amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the "Agreement;" the terms defined therein being used
herein as therein defined).
1. We hereby give you notice of, and request your consent to, the
assignment by _______________ (the "Assignor") to ____________ (the
"Assignee") of ___% of the right, title and interest of the Assignor in
and to the Loan Documents, including the right, title and interest of the
Assignor in and to the Commitment of the Assignor and all outstanding
Loans made by the Assignor. Before giving effect to such assignment:
(a) the aggregate amount of the Assignor's Commitment is $_______;
(b) the aggregate principal amount of its outstanding Loans is
$______.
2. The Assignee hereby represents and warrants that it is an
Eligible Assignee and has complied with the requirements of Section 10.7
of the Agreement in connection with this assignment and acknowledges and
agrees that: (a) other than the representation and warranty that it is the
legal and beneficial owner of the Pro Rata Share being assigned thereby
free and clear of any adverse claim, the Assignor has made no
representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection
with the Agreement or the execution, legality, validity, enforceability,
genuineness or sufficiency of the Agreement or any other Loan Document;
(b) the Assignor has made no representation or warranty and assumes no
responsibility with respect to the financial condition of the Company or
the performance by the Company of the Obligations; (c) it has received a
copy of the Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 6.1 thereof, and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and Acceptance;
(d) it will, independently and without reliance upon Agent or any Bank and
based on such documents and information as it shall deem appropriate at
Exhibit E-1
the time, continue to make its own credit decisions in taking or not
taking action under the Agreement; (e) it appoints and authorizes Agent to
take such action and to exercise such powers under the Agreement and the
other Loan Documents as are delegated to Agent by the Agreement and such
other Loan Documents; and (f) it will perform in accordance with their
terms all of the obligations which by the terms of the Agreement are
required to be performed by it as a Bank.
3. The Assignee agrees that, upon receiving your consent to such
assignment and from and after , the Assignee will be bound
by the terms of the Loan Documents, with respect to the interest in the
Loan Documents assigned to it as specified above, as fully and to the same
extent as if the Assignee were one of the Banks originally holding such
interest in the Loan Documents.
4. The following administrative details apply to the Assignee:
(a) Offshore Lending Office:
Assignee name: ________________________________________________
Address: ______________________________________________________
Attention: ____________________________________________________
Telephone: (___)______________________________________________
Telecopier: (___)______________________________________________
(b) Domestic Lending Office:
Assignee name: ________________________________________________
Address: ______________________________________________________
Attention: ____________________________________________________
Telephone: (___)______________________________________________
Telecopier: (___)______________________________________________
(c) Notice Address:
Assignee name: ________________________________________________
Address: ______________________________________________________
Attention: ____________________________________________________
Telephone: (___)______________________________________________
Telecopier: (___)______________________________________________
(d) Payment Instructions: Account No.:
Assignee name: ________________________________________________
Address: ______________________________________________________
Attention: ____________________________________________________
Telephone: (___)______________________________________________
Exhibit E-2
Telecopier: (___)______________________________________________
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective
duly authorized officials, officers or agents as of the date first above
mentioned.
Very truly yours,
[ASSIGNOR]
By:______________________________
Name:____________________________
Title:___________________________
[ASSIGNEE]
By:______________________________
Name:____________________________
Title:___________________________
We hereby consent to the
foregoing assignment.
UNUMPROVIDENT CORPORATION
By:______________________________
Name:____________________________
Title:___________________________
BANK OF AMERICA, N.A., as Administrative Agent
By:______________________________
Name:____________________________
Title:___________________________
Exhibit E-3
EXHIBIT F
[FORM OF] PROMISSORY NOTE
$____________ _______________, 2000
FOR VALUE RECEIVED, the undersigned, UnumProvident Corporation (the
"Company"), hereby promises to pay to the order of ________ (the "Bank")
the principal sum of _______ Dollars ($_____) or, if less, the aggregate
unpaid principal amount of all Loans made by the Bank to the Company
pursuant to the 364-Day Credit Agreement, dated as of October , 2000 (such
Credit Agreement), as it may be amended, restated, supplemented or
otherwise modified from time to time, being hereinafter called the "Credit
Agreement"), among the Company, the Bank, the other banks parties thereto,
Citicorp USA, Inc. and Wachovia Bank, N.A., as Co-Syndication Agents,
Fleet National Bank, as Documentation Agent and Bank of America, N.A., as
Administrative Agent for the Banks, on the dates and in the amounts
provided in the Credit Agreement. The Company further promises to pay
interest on the unpaid principal amount of the Loans evidenced hereby from
time to time at the rates, on the dates, and otherwise as provided in the
Credit Agreement.
The Bank is authorized to endorse the amount and the date on which
each Loan is made, the maturity date therefor and each payment of
principal with respect thereto on the schedules annexed hereto and made a
part hereof, or on continuations thereof which shall be attached hereto
and made a part hereof; provided, that any failure to endorse such
information on such schedule or continuation thereof shall not in any
manner affect any obligation of the Company under the Credit Agreement and
this Promissory Note (the "Note").
This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Credit Agreement, which Credit Agreement, among other
things, contains provisions for acceleration of the maturity hereof upon
the happening of certain stated events and also for prepayments on account
of principal hereof prior to the maturity hereof upon the terms and
conditions therein specified.
Exhibit F-1
Terms defined in the Credit Agreement are used herein with their
defined meanings therein unless otherwise defined herein. This Note shall
be governed by, and construed and interpreted in accordance with, the laws
of the State of New York applicable to contracts made and to be performed
entirely within such State.
UNUMPROVIDENT CORPORATION
By:______________________________
Title:___________________________
Exhibit F-2
Schedule A to Note
BASE RATE LOANS AND REPAYMENT OF BASE RATE LOANS
(2) (3) (4)
Amount Maturity Amount of (5)
(1) of Base Date of Base Rate Notation
Date Rate Loan Base Rate Loan Loan Repaid Made By
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Exhibit F-3
Schedule B to Note
OFFSHORE RATE LOANS AND REPAYMENT OF OFFSHORE RATE LOANS
(2) (3) (4)
Amount Maturity Amount of (5)
(1) of Offshore Date of Offshore Rate Notation
Date Rate Loan Offshore Rate Loan Loan Repaid Made By
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Exhibit F-4
