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EXHIBIT 10.29
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CREDIT AGREEMENT
DATED AS OF OCTOBER 23, 1997
AMONG
STORAGE TECHNOLOGY CORPORATION,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
SWINGLINE BANK,
AND
LETTER OF CREDIT ISSUING BANK
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
ARRANGED BY
BANCAMERICA XXXXXXXXX XXXXXXXX
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TABLE OF CONTENTS
Section Page
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ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Other Interpretive Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
1.3 Accounting Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE II DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.1 Amounts and Terms of Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.2 Loan Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.3 Procedure for Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.4 Conversion and Continuation Elections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.5 Voluntary Termination or Reduction of Commitments . . . . . . . . . . . . . . . . . . . . . . . . 24
(a) Termination or Reduction of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . 24
(b) Automatic Reduction of Swingline Commitment . . . . . . . . . . . . . . . . . . . . . . . 24
2.6 Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.7 Mandatory Prepayments of Loans; Mandatory Commitment Reductions . . . . . . . . . . . . . . . . . 25
2.8 Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.9 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.10 Swingline Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.11 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(a) Commitment Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(b) Arrangement Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2.12 Computation of Fees and Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
2.13 Payments by the Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.14 Payments by the Banks to the Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.15 Sharing of Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE III THE LETTERS OF CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.1 The Letter of Credit Subfacility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.2 Issuance, Amendment and Renewal of Letters of Credit . . . . . . . . . . . . . . . . . . . . . . 32
3.3 Existing BofA Letters of Credit; Risk Participations,
Drawings and Reimbursements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.4 Repayment of Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
3.5 Role of the Issuing Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
3.6 Obligations Absolute . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
3.7 Cash Collateral Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
3.8 Letter of Credit Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
3.9 Uniform Customs and Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE IV TAXES, YIELD PROTECTION AND ILLEGALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
4.1 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
4.2 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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4.3 Increased Costs and Reduction of Return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.4 Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.5 Inability to Determine Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
4.6 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
4.7 Notice of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE V CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.1 Conditions to Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
(a) Credit Agreement and Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
(b) Resolutions; Incumbency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
(c) Organization Documents; Good Standing . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(d) Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(e) Payment of Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(f) Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(g) Other Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
5.2 Conditions to All Credit Extensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(a) Prior Loan Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(b) Notice, Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(c) Continuation of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . 45
(d) No Existing Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
(e) Cash Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE VI REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.1 Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.2 Corporate Authorization; No Contravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.3 Governmental Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.4 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.5 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.6 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.7 ERISA Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.8 Use of Proceeds; Margin Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.9 Title to Properties; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.11 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.12 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.13 Regulated Entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.14 Copyrights, Patents, Trademarks and Licenses, Etc. . . . . . . . . . . . . . . . . . . . . . . . 49
6.15 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.16 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
6.17 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
6.18 Projections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE VII AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
7.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
7.2 Certificates; Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
7.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
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7.4 Preservation of Corporate Existence, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
7.5 Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
7.6 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
7.7 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
7.8 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
7.9 Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.10 Inspection of Property and Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.11 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.12 Disclosure; Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.13 Financial Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
(a) Maintenance of Consolidated Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . 54
(b) Consolidated Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
(c) Consolidated Total Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
(d) Adjusted Quick Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7.14 Patents and Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
ARTICLE VIII NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
8.1 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
8.2 Disposition of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
8.3 Consolidations and Mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
8.4 Loans and Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
8.5 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
8.6 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
8.7 Contingent Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
8.8 Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
8.9 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
8.10 Change in Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
8.11 Accounting Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
ARTICLE IX EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
9.1 Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(a) Non-Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(b) Representation or Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(c) Specific Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(d) Other Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(e) Cross-Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(f) Insolvency; Voluntary Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(g) Involuntary Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(h) ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(i) Monetary Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(j) Non-Monetary Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(k) Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
(l) Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.2 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.3 Certain Financial Covenant Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
10.1 Appointment and Authorization; "Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
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10.2 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
10.3 Liability of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
10.4 Reliance by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
10.5 Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
10.6 Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
10.7 Indemnification of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
10.8 Agent in Individual Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
10.9 Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
10.10 Withholding Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
ARTICLES XI MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
11.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
11.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
11.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
11.4 Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
11.5 Borrower's Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
11.6 Payments Set Aside . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.7 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.8 Assignments, Participations, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.9 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
11.10 Set-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
11.11 Automatic Debits of Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.12 Notification of Addresses, Lending Offices, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 75
11.13 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.14 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.15 No Third Parties Benefited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.16 Governing Law and Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.17 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
11.18 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
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SCHEDULES
Schedule 2.1 Commitments and Pro Rata Shares
Schedule 2.9(e) Applicable Margin and Commitment Fees
Schedule 5.2(a) Letters of Credit Outstanding Under Prior Loan Documents
Schedule 6.5 Litigation
Schedule 6.11 Permitted Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.15 Subsidiaries and Minority Interests
Schedule 6.16 Insurance Matters
Schedule 8.1(i) Permitted Liens
Schedule 8.2 Permitted Dispositions
Schedule 8.4(f) Permitted Investments
Schedule 8.7(e) Contingent Obligations
Schedule 11.2 Addresses for Notices; Lending Offices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D-1 Form of Legal Opinion of Shearman & Sterling
Exhibit D-2 Form of Legal Opinion of Internal Borrower's Counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F Form of Promissory Note
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CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of October 23, 1997, among
Storage Technology Corporation, a Delaware corporation ("the Borrower"), the
several financial institutions from time to time party to this Credit Agreement
(individually, a "Bank"; collectively, the "Banks"), and Bank of America
National Trust and Savings Association, as swingline bank, letter of credit
issuing bank and as agent for the Banks.
WHEREAS, the Borrower, the Agent and certain financial institutions
were parties to that certain Credit Agreement dated as of April 9, 1997 (as
modified, the "Prior Credit Agreement") and certain other documents executed in
connection therewith (together with the Prior Credit Agreement, referred to at
times as the "Prior Loan Documents);
WHEREAS, the Borrower has decided to terminate the Prior Credit
Agreement and the other Prior Loan Documents in order to enter into this Credit
Agreement and the Loan Documents with the parties hereto;
WHEREAS, the Banks are willing to extend certain credit facilities to
the Borrower on the basis of this Credit Agreement and the Loan Documents and
to facilitate the termination of the Prior Credit Agreement and the other Prior
Loan Documents as provided in this Credit 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, membership interests or equity of any Person, or otherwise
causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person (other than
a Person that is a Subsidiary) provided that the Borrower or its
Subsidiary is the surviving entity.
"Adjusted Quick Ratio" means, for any Person for any period,
the ratio that (i) Current Liquid Assets of such Person bears to (ii)
Current Liabilities of such Person.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person. A Person
1.
8
shall be deemed to control another Person if the controlling Person
possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by
contract, or otherwise.
"Agent" means BofA in its capacity as agent for the Banks
hereunder, and any successor agent arising under Section 10.9.
"Agent-Related Persons" means BofA and any successor agent
arising under Section 10.9 and any successor letter of credit issuing
bank hereunder, together with their respective Affiliates (including,
in the case of BofA, 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 11.2 or such other address as the Agent may from
time to time specify.
"Agreement" means this Credit Agreement.
"Applicable Fee Amount" means with respect to the commitment
fee payable hereunder, the amount set forth opposite the indicated
level below the heading "Commitment Fee" in the pricing grid set forth
on Schedule 2.9(e) in accordance with the parameters for calculations
of such amount set forth in Sections 2.9(e) and 2.11(a).
"Applicable Margin" means the amount set forth opposite the
indicated level below the heading "Base Rate Spread" or "Offshore Rate
Spread," as appropriate, in the pricing grid set forth in Schedule
2.9(e) in accordance with the parameters for calculations of such
amount also set forth in Sections 2.9(e) and 2.11(a).
"Arranger" means BancAmerica Xxxxxxxxx Xxxxxxxx.
"Assignee" has the meaning specified in subsection 11.8(a).
"Attorney Costs" means and includes all fees and disbursements
of any law firm or other external counsel, the allocated cost of
internal legal services and all disbursements of internal counsel.
"Bank" has the meaning specified in the introductory clause
hereto. References to the "Banks" shall include BofA, including in
its capacity as Issuing Bank and Swingline Bank; for purposes of
clarification only, to the extent that BofA may have any rights or
obligations in addition to those of the Banks due to its status as
Issuing Bank and Swingline Bank, its status as such will be
specifically referenced.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of
1978 (11 U.S.C. Section 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
2.
9
announced from time to time by BofA in SAN Francisco, California, as
its "reference rate." (The "reference rate" is a rate set by BofA
based upon various factors including BofA'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 reference rate announced by BofA shall take
effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Loan" means a Revolving Loan, a Swingline Loan or
an L/C Advance, that bears interest based on the Base Rate.
"BofA" means Bank of America National Trust and Savings
Association, a national banking association.
"Borrower" has the meaning specified in the introductory
clause of this Agreement.
"Borrowing" means a borrowing hereunder consisting of
Revolving Loans of the same Type made to the Borrower on the same day
by the Banks under Article II, or Swingline Loans of the same Type
made to the Borrower on the same day by the Swingline Bank under
Article II and, in each case, other than for 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 New York City or San Francisco
are authorized or required by law to close and, if the applicable
Business Day relates to any Offshore Rate Loan, means such a day on
which dealings are carried on in the applicable offshore Dollar
interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law,
in each case, regarding capital adequacy of any bank or of any
corporation controlling a bank.
"Capital Lease" means, for any Person, any lease of property
(whether real, personal or mixed) which, in accordance with GAAP,
would, at the time a determination is made, be required to be recorded
as a capital lease in respect of which such Per-son is liable as
lessee.
"Cash Collateralize" means, as provided in Section 3.7 hereof,
to pledge and deposit with or deliver to the Agent, for the benefit of
the Agent, the Issuing Bank, the Swingline Bank and the Banks, as
collateral for the Obligations, cash or deposit account balances
pursuant to documentation in form and substance satisfactory to the
Agent, the
3.
10
Swingline Bank and the Issuing Bank (which documents are hereby
consented to by the Banks). Derivatives of such term shall have
corresponding meanings.
"Change of Control" means the occurrence, after the date of
this Agreement, of any of the following: (a) any Person or two or more
Persons acting in concert acquiring beneficial ownership (within the
meaning of Rule 13d-3 of the SEC under the Exchange Act), directly or
indirectly, of securities of the Borrower (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Borrower entitled to
vote in the election of directors; or (b) during any period of up to
12 consecutive months, commencing after the Closing Date, individuals
who at the beginning of such 12-month period were directors of the
Borrower ceasing for any reason to constitute a majority of the Board
of Directors of the Borrower unless the Persons replacing such
individuals were nominated by the Board of Directors of the Borrower;
or (c) any Person or two or more Persons acting in concert acquiring
by contract or otherwise, or entering into a contract or arrangement
which upon consummation will result in its or their acquisition of, or
control over, securities of the Borrower (or other securities
convertible into such securities) representing 30% or more of the
combined voting power of all securities of the Borrower entitled to
vote in the election of directors.
"Closing Date" means the date on which all conditions
precedent set forth in Section 5.1 are satisfied or waived by all
Banks (or, in the case of subsection 5.1(e), waived by the Person
entitled to receive such payment).
"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.
"Consolidated" and any derivative thereof each means, with
reference to the accounts or financial reports of any Person, the
consolidated accounts or financial reports of such Person and each
Subsidiary of such Person determined in accordance with GAAP.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation (the "primary
obligations") of another Person (the "primary obligor"), including any
obligation of that Person (i) to purchase, repurchase or otherwise
acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such
primary obligation, or to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or
solvency or any balance sheet item, level of income or financial
condition of the primary obligor, (iii) to purchase property,
4.
11
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 otherwise to assure or
hold harmless the holder of any such primary obligation against loss
in respect thereof; (b) with respect to primary obligations of a
primary obligor in connection with any synthetic lease or similar off
balance sheet lease transaction or securitization transaction (each of
(a) and (b) a "Guaranty Obligation"), (c) with respect to any Surety
Instrument issued for the account of that Person or as to which that
Person is otherwise liable for reimbursement of drawings or payments;
(d) to purchase any materials, supplies or other property from, or to
obtain the services of, another Person if the primary purpose of the
contract or other related document or obligation requires that payment
for such materials, supplies or other property, or for such services,
shall be made regardless of whether delivery of such materials,
supplies or other property is ever made or tendered, or such services
are ever performed or tendered, or (e) in respect of any Swap
Contract. The amount of any Contingent Obligation shall, in the case
of Guaranty Obligations, be deemed equal to the stated or determinable
amount of the primary obligation in respect of which such Guaranty
Obligation is made or, if not stated or if indeterminable, the maximum
reasonably anticipated liability in respect thereof, and in the case
of other Contingent Obligations, shall be equal to the maximum
reasonably anticipated liability in respect thereof. Notwithstanding
anything to the contrary herein, Contingent Obligations shall not
include sales of Permitted Receivables (and books, chattel paper,
records, and software relating to the Permitted Receivables) sold
pursuant to the Permitted Receivables Purchase Facility and recourse
or repurchase obligations thereunder.
"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 Borrower (a) converts Loans of one Type to another
Type, or (b) continues as Loans of the same Type, but with a new
Interest Period, Loans having Interest Periods expiring on such date.
"Credit Extension" means and includes (a) the making of any
Revolving Loans or Swingline Loans hereunder, and (b) the Issuance of
any Letters of Credit hereunder (including the Existing BofA Letters
of Credit).
"Current Liabilities" of any Person means, as of any date of
determination, all liabilities of such Person (including estimated
accrued taxes and any Indebtedness outstanding under this Agreement
but excluding any obligations under the Multicurrency Note Purchase
Facility which are fully cash collateralized) which in accordance with
GAAP should be classified as current liabilities of such Person,
including the amount of any redeemable preferred stock of such Person
that is redeemable for cash at the option of the holder thereof or
that is mandatorily redeemable by such Person within one year of
5.
12
such date of determination, valued at the applicable redemption price,
plus accrued and unpaid dividends payable in respect of such
redeemable preferred stock.
"Current Liquid Assets" of any Person means, as of any date of
determination, all cash, short-term investments and accounts
receivable, in each case as shown on the most recent balance sheet of
such Person and determined in accordance with GAAP (but excluding any
such assets deposited to collateralize any obligations under the
Multicurrency Note Purchase Facility).
"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.
"Dollars," "dollars" and "$" each mean lawful money of the
United States.
"EBITDA" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, determined in accordance with
GAAP, the sum of (a) the Net Income (or Net Loss) for such period plus
(b) all amounts treated as expenses for depreciation, interest and the
amortization of intangibles of any kind to the extent included in the
determination of such Net Income (or Net Loss), plus (c) all accrued
taxes on or measured by income to the extent included in the
determination of such Net Income (or Net Loss).
"Effective Amount" means (a) with respect to any Revolving
Loans or Swingline Loans, as the case may be, on any date, the
aggregate outstanding principal amount thereof after giving effect to
any Borrowings and prepayments or repayments of Revolving Loans or
Swingline Loans occurring on such date; and (b) with respect to any
outstanding L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any Issuances of
Letters of Credit occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as
a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount
available for drawing under Letters of Credit taking effect on such
date.
"Effective Date" has the meaning ascribed to it in Section
5.2(a).
"Eligible Assignee" means (a) a commercial bank organized
under the laws of the United States, or any state thereof, and having
a combined capital and surplus of at least $200,000,000; (b) a
commercial bank organized under the laws of any other country which is
a member of the Organization for Economic Cooperation and Development
(the "OECD"), or a political subdivision of any such country, and
having a combined capital and surplus of at least $200,000,000,
provided that such bank is acting through a branch or agency located
in the United States; and (c) a Person that is primarily engaged in
the business of commercial banking and that is (i) a Subsidiary of 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.
6.
13
"Environmental Claims" means all claims, however asserted, by
any Governmental Authority or other Person alleging potential
liability or responsibility for violation of any Environmental Law, or
for release or injury to the environment.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental,
health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of
1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower 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 Borrower or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan
year in which it was a substantial employer (as defined in Section
4001(a)(2) of ERISA) or a cessation of operations which is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or
4041A of ERISA, or the commencement of proceedings by the PBGC to
terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer Plan; or
(f) the imposition of any liability under Title IV of ERISA, other
than PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon the Borrower 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 9.1.
"Exchange Act" means the Securities Exchange Act of 1934.
"Existing BofA Letters of Credit" means the letters of credit
issued by BofA for the account of the Borrower and outstanding under
the Prior Credit Agreement on the Termination Date.
"FDIC" means the Federal Deposit Insurance Corporation, and
any Governmental Authority succeeding to any of its principal
functions.
7.
14
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of New
York with respect to the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is
not so published with respect to any such preceding Business Day, the
rate for such day will be the arithmetic mean as determined by the
Agent of the rates for the last transaction in overnight Federal funds
arranged prior to 9:00 a.m. (New York City time) on that day by each
of three leading brokers of Federal funds transactions in New York
City selected by the Agent.
"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 set
forth from time to time in the opinions and pronouncements of the
Accounting Principles Board and the American Institute of Certified
Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date
of determination.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guaranty Obligation" has the meaning specified in the
definition of "Contingent Obligation."
"Honor Date" means each date that any amount is paid by the
Issuing Bank under any Letter of Credit.
"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 entered into in the ordinary
course of business on ordinary terms); (c) all reimbursement or
payment obligations (contingent or otherwise) with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in
connection with the acquisition of property, assets or businesses; (e)
all indebtedness created or arising under any conditional sale or
other title retention agreement, or incurred as financing, in either
case with respect to property acquired by the Person (even though the
rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such
property); (f) all obligations with respect to Capital Leases; (g) all
indebtedness referred to in clauses (a) through (f) above secured by
(or for which the holder of such
8.
15
Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien upon or in property (including accounts and
contracts rights) owned by such Person, even though such Person has
not assumed or become liable for the payment of such Indebtedness; and
(h) all Guaranty Obligations in respect of indebtedness or obligations
of others of the kinds referred to in clauses (a) through (g) above.
Notwithstanding anything to the contrary herein, Indebtedness shall
not include sales of Permitted Receivables (and books, chattel paper,
records and software relating to the Permitted Receivables) sold
pursuant to the Permitted Receivables Purchase Facility and recourse
or repurchase obligations thereunder. For all purposes of this
Agreement, the Indebtedness of any Person shall include all recourse
Indebtedness of any partnership or joint venture or limited liability
company in which such Person is a general partner or a joint venturer
or a member.
"Indemnified Liabilities" has the meaning specified in Section
11.5.
"Indemnified Person" has the meaning specified in Section
11.5.
"Independent Auditor" has the meaning specified in subsection
7.1(a).
"Insolvency Proceeding" means, with respect to any Person, (a)
any case, action or proceeding with respect to such Person before any
court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the
benefit of creditors, composition, marshalling of assets for
creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; in either case
undertaken under U.S. Federal, state or foreign law, including the
Bankruptcy Code.
"Interest Payment Date" means, (a) as to any Loan other than a
Base Rate Loan, the last day of each Interest Period applicable to
such Loan, (b) as to any Base Rate Loan other than a Swingline Loan,
the last Business Day of each calendar quarter, and (c) as to any Base
Rate Loans which are Swingline Loans, the Business Day agreed upon by
the Borrower and the Swingline Bank which shall not be later than the
seventh Business Day following the Borrowing Date thereof; provided,
however, that if any Interest Period for an Offshore Rate Loan exceeds
three months, the date that falls three months after the beginning of
such Interest Period and after each Interest Payment Date thereafter
is also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the
period commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two,
three or six months thereafter as selected by the Borrower in its
Notice of Borrowing or Notice of Conversion/Continuation;
provided that:
9.
16
(a) 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;
(b) 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
(c) no Interest Period for any Loan
shall extend beyond the Revolving Termination Date.
"Investments" has the meaning specified in Section 8.4.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Issuance Date" has the meaning specified in subsection
3.1(a).
"Issue" means, with respect to any Letter of Credit, to
incorporate the Existing BofA Letters of Credit into this Agreement,
or to issue or to extend the expiry of, or to renew or increase the
amount of, such Letter of Credit; and the terms "Issued," "Issuing"
and "Issuance" have corresponding meanings.
"Issuing Bank" means BofA in its capacity as issuer of one or
more Letters of Credit hereunder, together with any replacement letter
of credit issuer arising under subsection 10.1(b) or Section 10.9.
"Joint Venture" means a single-purpose corporation,
partnership, limited liability company, joint venture or other similar
legal arrangement (whether created by contract or conducted through a
separate legal entity) now or hereafter formed by the Borrower or any
of its Subsidiaries with another Person in order to conduct a common
venture or enterprise with such Person.
"L/C Advance" means each Bank's participation in any L/C
Borrowing in accordance with its Pro Rata Share.
"L/C Amendment Application" means an application for amendment
of outstanding standby or commercial documentary letters of credit, in
the form as shall at any time be in use at the Issuing Bank, as the
Issuing Bank shall reasonably request.
"L/C Application" means an application for issuances of
standby or commercial documentary letters of credit, in the form as
shall at any time be in use at the Issuing Bank, as the Issuing Bank
shall reasonably request.
10.
17
"L/C Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been
reimbursed on the date when made nor converted into a Borrowing of
Revolving Loans under subsection 3.3(c).
"L/C Commitment" means the commitment of the Issuing Bank to
Issue, and the commitment of the Banks severally to participate in,
Letters of Credit (including the Existing BofA Letters of Credit) from
time to time Issued or outstanding under Article III, in an aggregate
amount not to exceed on any date the amount of $75,000,000, as the
same shall be reduced as a result of a reduction in the L/C Commitment
pursuant to Section 2.5; provided that the L/C Commitment is a part of
the combined Commitments, rather than a separate, independent
commitment.
"L/C Obligations" means at any time the sum of (a) the
aggregate undrawn amount of all Letters of Credit then outstanding,
plus (b) the amount of all unreimbursed drawings under all Letters of
Credit, including all outstanding L/C Borrowings.
"L/C-Related Documents" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of Credit, including any of the Issuing Bank's
standard form documents for letter of credit issuances.
"Lending Office" means, as to any Bank, the office or offices
of such Bank specified as its "Lending Office" on Schedule 11.2, or
such other office or offices as such Bank may from time to time notify
the Borrower and the Agent.
"Letters of Credit" means any letters of credit (whether
standby letters of credit or commercial documentary letters of credit)
Issued by the Issuing Bank pursuant to Article III and, as of the
Termination Date, the Existing BofA Letters of Credit.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of
any kind or nature whatsoever in respect of any property (including
those created by, arising under or evidenced by any conditional sale
or other title retention agreement, the interest of a lessor under a
Capital Lease, any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any
financing statement naming the owner of the asset to which such lien
relates as debtor, under the Uniform Commercial Code or any comparable
law) and any contingent or other agreement to provide any of the
foregoing, but not including the interest of a lessor under an
Operating Lease.
"Loan" means an extension of credit by a Bank or the Swingline
Bank to the Borrower under Article II or Article III in the form of a
Revolving Loan, Swingline Loan or L/C Advance.
11.
18
"Loan Documents" means this Agreement, any Notes, the
L/C-Related Documents, 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 G, 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
Borrower and its Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Borrower 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 Borrower of any Loan Document.
"Material Subsidiary" means any Subsidiary that at any time
either (a) owns or holds title to 5% or more of the Consolidated
assets of the Borrower and its Consolidated Subsidiaries or (b)
accounts for 5% or more of the Consolidated revenue of the Borrower
and its Consolidated Subsidiaries, in each case as determined in
accordance with GAAP.
"Multicurrency Note Purchase Facility" means the facility
pursuant to the Contingent Multicurrency Note Purchase Commitment
Agreement dated as of December 12, 1996 (as amended, restated,
modified or supplemented from time to time) between Borrower and BofA,
whereby BofA has agreed to purchase certain notes of the Borrower
subject, in certain cases, to collateralization in cash and other
investments or any similar facility designed to accomplish the same
objectives.
"Multiemployer Plan" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which the Borrower or any
ERISA Affiliate makes, is making, or is obligated to make
contributions or, during the preceding three calendar years, has made,
or been obligated to make, contributions.
"Net Income" means, with respect to any Person for any period,
net income of such Person, as determined by such Person in accordance
with GAAP.
"Net Loss" means, with respect to any Person for any period,
negative Net Income of such Person, as determined by such Person in
accordance with GAAP.
"Note" means a promissory note executed by the Borrower in
favor of a Bank pursuant to subsection 2.2(b), in substantially the
form of Exhibit F.
"Notice of Borrowing" means a notice in substantially the form
of Exhibit A.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means all advances, debts, liabilities,
obligations, covenants and duties arising under any Loan Document
owing by the Borrower to any Bank, the Issuing
12.
19
Bank, the Swingline 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": For any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate
equal to (A) (i) the rate of interest per annum determined by the
Agent to be the rate of interest per annum appearing on Telerate
display page 3750 (or such other display page on the Telerate System
as may replace such page) for Dollar deposits in an amount
substantially equal to the proposed Offshore Rate Loan to be made,
continued or converted by Agent, in its individual capacity, and
having a maturity comparable to such Interest Period, at approximately
11:00 a.m. (London time) two Business Days prior to the commencement
of such Interest Period, subject to clause (ii) below; or (ii) if for
any reason the rate is not available as provided in the preceding
clause (i) of this definition, the "Offshore Rate" instead means the
rate of interest per annum determined by the Agent (rounded to the
next higher 1/16 of 1%) to be the rate at which deposits in Dollars
are offered to prime banks by the principal office of BofA in the
London interbank market, at approximately 11:00 a.m. (London time),
two Business Days before the first day of such Interest Period, in the
approximate amount of the Offshore Rate Loan to be made by BofA and
for a period of time comparable to such Interest Period; divided by
(B) a number equal to 1.00 minus the aggregate (but without
duplication) of the rate (expressed as a decimal fraction) of reserve
requirements in effect on the day which is two Business Days prior to
the commencement of such Interest Period (including basic,
supplemental, marginal and emergency reserves under any regulations of
the Board of Governors of the Federal Reserve System or other
governmental authority having jurisdiction with respect thereto, as in
effect at the time BofA quotes its rate to the Agent) for Eurocurrency
funding of domestic assets (currently referred to as "Eurocurrency
liabilities" in Regulation D of such Board) that are required to be
maintained by a member bank of such System. The determination of the
Offshore Rate 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.
"Operating Lease" means, for any Person, any lease of any
property of any kind by that Person as lessee which is not a Capital
Lease.
"Operating Loss" of any Person means, as of the date of
determination, operating losses as calculated in accordance with GAAP.
"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.
"Participant" has the meaning specified in subsection 11.8(d).
13.
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"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions
under ERISA.
"Pension Plan" means a pension plan (as defined in Section
3(2) of ERISA) subject to Title IV of ERISA which the Borrower
sponsors, maintains, or to which it makes, is making, or is obligated
to make contributions, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions at any
time during the immediately preceding five (5) plan years.
"Permitted Liens" has the meaning specified in Section 8.1.
"Permitted Receivable" shall mean at any time a Receivable
which constitutes an "account," "chattel paper" or a "general
intangible" and any "proceeds" thereof (each as defined in the UCC)
and collections thereon, which has been sold by the Borrower to BofA
or any of its Affiliates pursuant to the Permitted Receivables
Purchase Facility with or without recourse.
"Permitted Receivables Purchase Facility" shall mean that
certain Multicurrency Receivables Transfer Agreement dated January 29,
1996, as amended, which will terminate on January 31, 1998, between
the Borrower and BofA pursuant to which Permitted Receivables may be
sold or otherwise transferred by the Borrower to BofA or any Affiliate
of BofA, provided, that the aggregate purchase price paid therefor
shall not exceed $40,000,000 (with the aggregate face value thereof
not to exceed at any time outstanding $50,000,000).
"Permitted Swap Obligations" means all obligations (contingent
or otherwise) of the Borrower or any Subsidiary existing or arising
under Swap Contracts, provided that such obligations are (or were)
entered into in connection with a bona fide hedging operation that
provides offsetting benefits to such Person.
"Person" means an individual, partnership, corporation,
limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or
any other entity of whatever nature.
"Plan" means an employee benefit plan (as defined in Section
3(3) of ERISA) which the Borrower sponsors or maintains or to which
the Borrower makes, is making, or is obligated to make contributions
and includes any Pension Plan.
"Prior Credit Agreement" has the meaning specified in the
recitals hereto.
"Prior Loan Documents" has the meaning specified in the
recitals hereto.
"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 (or, if all Commitments have been
terminated, the aggregate principal amount of such Bank's Loans
divided by the aggregate principal amount of the Loans then held by
all Banks).
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The initial Pro Rata Share of each Bank is set forth opposite such
Bank's name in Schedule 2.1 under the heading Pro Rata Share.
"Receivable" means any right to payment from an account
receivable obligor, arising from the sale of goods or services or the
licensing of intellectual property rights by the Borrower in the
ordinary course of its business.
"Reportable Event" means, any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than any
such event for which the 30-day notice requirement under ERISA has
been waived in regulations issued by the PBGC.
"Required Banks" means at any time Banks then holding at least
51% of the aggregate amount of the Commitments or, if no Commitments
are outstanding, Banks then having at least 51% of the then aggregate
unpaid principal amount of the Loans (including the Swingline Loans).
"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, with respect to the Borrower, the
chief executive officer, the president, any vice president, the
treasurer, chief operating officer or chief financial officer,
assistant treasurer, or the secretary of the Borrower, or any other
officer having substantially the same authority and responsibility;
or, with respect to compliance with financial covenants, the chief
financial officer, assistant treasurer or the treasurer of the
Borrower, or any other officer having substantially the same authority
and responsibility.
"Revolving Loan" has the meaning specified in Section 2.1, and
may be a Base Rate Loan or an Offshore Rate Loan (each, a "Type" of
Revolving Loan).
"Revolving Termination Date" means the earlier to occur of:
(a) October 23, 2001; and
(b) the date on which the Commitments terminate in
accordance with the provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"Subordinated Indebtedness" means Indebtedness which is
expressly subordinated to the Obligations on terms consented to in
writing by the Required Banks.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture, trust or other
business entity of which more than 50% of
15.
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the voting stock, membership interests or other equity interests (in
the case of Persons other than corporations), is owned or controlled
directly or indirectly by the Person, or one or more of the
Subsidiaries of the Person, or a combination thereof. Unless the
context otherwise clearly requires, references herein to a
"Subsidiary" refer to a Subsidiary of the Borrower.
"Surety Instruments" means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties,
shipside bonds, surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in
writing, relating to any transaction that is a rate swap, basis swap,
forward rate transaction, commodity swap, commodity option, equity or
equity index swap or option, bond, note or xxxx option, interest rate
option, forward foreign exchange transaction, cap, collar or floor
transaction, currency swap, cross-currency rate swap, swaption,
currency option or any other, similar transaction (including any
option to enter into any of the foregoing) or any combination of the
foregoing, and, unless the context otherwise clearly requires, any
master agreement relating to or governing any or all of the foregoing.
"Swingline Bank" means BofA.
"Swingline Commitment" has the meaning specified in Section
2.10(a).
"Swingline Loan" has the meaning specified in Section 2.10(a).
"Tangible Net Worth" means, with respect to any Person as of
any date of determination, Total Assets of such Person as of such date
minus Total Liabilities of such Person as of such date and minus the
carrying value of (a) goodwill, organizational expenses, patents,
patent applications, trademarks, trademark applications, trade names,
service marks, service xxxx applications, copyrights, designs and
other intellectual property and licenses therefor and rights therein,
and other similar intangibles, (b) all amortizing debt issuance
expenses carried as an asset, (c) all reserves carried and not
deducted from assets or not reflected as a liability, and (d) cash
held in a sinking or other analogous fund established for the purpose
of redemption, retirement or prepayment of any capital stock or any
Indebtedness or Contingent Obligation, if no offsetting liability
exists with respect to such Indebtedness or Contingent Obligation on
the balance sheet of such Person.
"Taxes" means any and all present or future taxes (including
any taxes on any additional amounts required to be paid to the Agent
or the Banks), levies, assessments, imposts, duties, deductions, fees,
withholdings or similar charges, and all liabilities with respect
thereto, excluding, in the case of each Bank and the Agent,
respectively, (a) taxes imposed on its income by the United States and
taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Bank or the Agent (as the
case may be) is organized or any political subdivision thereof, and
(b)
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taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction of such Bank's Lending Office, or any political
subdivision thereof.
"Termination Date" means the date on which the Prior Credit
Agreement is terminated and fully discharged.
"Total Assets" of any Person means all property, whether real,
personal, tangible, intangible or otherwise, which, in accordance with
GAAP, should be included in determining total assets as shown on the
assets portion of a balance sheet of such Person.
"Total Capital" of any Person means the sum of the
Consolidated Tangible Net Worth of such Person plus Consolidated Total
Debt of such Person.
"Total Debt" means, with respect to any Person, all
Indebtedness of such person incurred for borrowed money plus, without
duplication, all reimbursement obligations in respect of letters of
credit plus all obligations outstanding pursuant to the Multicurrency
Note Purchase Facility.
"Total Leverage Ratio" means, with respect to any Person, the
ratio that (i) Consolidated Total Debt bears to (ii) Total Capital of
such Person.
"Total Liabilities" of any Person means all obligations,
including, without limitation, all Indebtedness (other than Guaranty
Obligations) of such Person, which, in accordance with GAAP, should be
included in determining total liabilities as shown on the liabilities
portion of a balance sheet of such Person.
"Total Commitment Amount" means the total amount of
Commitments available hereunder during the following periods:
Period Total Commitment Amount
------ -----------------------
(1) Closing Date to December 31, 1998 $350,000,000
(2) December 31, 1998 to March 31, 1999 $337,500,000
(3) March 31, 1999 to June 30, 1999 $325,000,000
(4) June 30, 1999 to September 30, 1999 $312,500,000
(5) September 30, 1999 to December 31, 1999 $300,000,000
(6) December 31, 1999 to March 31, 2000 $287,500,000
(7) March 31, 2000 to June 30, 2000 $275,000,000
(8) June 30, 2000 to September 29, 2000 $262,500,000
(9) September 29, 2000 to December 29, 2000 $250,000,000
(10) December 29, 2000 to March 30, 2001 $237,500,000
(11) March 30, 2001 to June 29, 2001 $225,000,000
(12) June 29, 2001 to September 28, 2001 $212,500,000
(13) September 28, 2001 to Revolving Termination Date $200,000,000
(14) Revolving Termination Date $0
"Type" has the meaning specified in the definition of
"Revolving Loan."
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"UCC" means the Uniform Commercial Code as in effect in the
State of California.
"Unfunded Pension Liability" means the excess of a Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the
current value of that Plan's assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412
of the Code for the applicable plan year.
"United States" and "U.S." each means the United States of
America.
"Wholly Owned Subsidiary" means any corporation in which 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 Borrower, or by one or more of the
other Wholly Owned Subsidiaries, or both; provided that, as to foreign
Subsidiaries this definition means any corporation in which at least
99% of the capital stock of each class having ordinary voting power
and at least 99% of the capital stock of every other class, at the
time as of which any determination is made, in each case is owned
beneficially and of record by the Borrower or 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."
(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."
(iv) The term "property" includes any kind of
property or asset, real, personal or mixed, tangible or intangible.
(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
18.
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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. Unless otherwise
expressly provided, any reference to any action of the Agent, the Issuing Bank,
the Swingline Bank or the Banks by way of consent, approval or waiver shall be
deemed modified by the phrase "in its/their sole discretion."
(g) This Agreement and the other Loan Documents are the
result of negotiations among the Agent, the Issuing Bank, the Swingline Bank,
the Borrower and the other parties, have been reviewed by counsel to the Agent,
the Borrower and such other parties, and are the product of all parties.
Accordingly, they shall not be construed against the Banks, the Issuing Bank,
the Swingline Bank 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 Borrower.
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ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitment. Each Bank severally agrees,
on the terms and conditions set forth herein, to make loans to the Borrower
(each such loan, a "Revolving Loan") 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 under the heading "Commitment" (such amount, inclusive of such
Bank's L/C Commitment and, in the case of BofA, its Swingline Commitment, as
the same may be reduced under Section 2.5 and Section 2.7 or reduced or
increased as a result of one or more assignments under Section 11.8, the Bank's
"Commitment"); provided, however, that, after giving effect to any Borrowing of
Revolving Loans, (i) the Effective Amount of all outstanding Revolving Loans,
the Effective Amount of all Swingline Loans and the Effective Amount of all L/C
Obligations, shall not at any time exceed the Total Commitment Amount; and (ii)
the Effective Amount of the Revolving Loans of any Bank and the Effective
Amount of all Swingline Loans of any Bank plus the participation of such Bank
in the Effective Amount of all L/C Obligations shall not at any time exceed
such Bank's Commitment (except for BofA, but solely with respect to its
Swingline Commitment), as such Bank's Commitment may be reduced hereunder.
Within the limits of each Bank's Commitment, and subject to the other terms and
conditions hereof, the Borrower 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 (including the
Swingline Bank) and the Letters of Credit Issued by the Issuing Bank shall be
evidenced by one or more accounts or records maintained by such Bank or Issuing
Bank, as the case may be, in the ordinary course of business. The accounts or
records maintained by the Agent, the Issuing Bank and each Bank (including the
Swingline Bank) shall be conclusive absent manifest error of the amount of the
Loans made by the Banks (including the Swingline Bank) to the Borrower and the
Letters of Credit Issued for the account of the Borrower, 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 Borrower hereunder to
pay any amount owing with respect to the Loans or any Letter of Credit.
(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 or in addition to loan accounts. Each such Bank shall
endorse on the schedules annexed to its Notes the date, amount and
maturity of each Loan made by it and the amount of each payment of
principal made by the Borrower with respect thereto. Each such Bank
is irrevocably authorized by the Borrower to endorse its Notes 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 Borrower hereunder or under
any such Note to such Bank.
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2.3 Procedure for Borrowing. (a) Each Borrowing of Revolving
Loans shall be made upon the Borrower'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 9:00 a.m. San Francisco time) (i) three Business Days
prior to the requested Borrowing Date, in the case of Offshore Rate Loans; and
(ii) on the Business Day which is 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
$10,000,000 or any integral 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 one month.
provided, however, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
9:00 a.m. (San Francisco time) one Business Day before the Closing Date and
such Borrowing will consist of Base Rate Loans only.
(b) The 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.
(c) Each Bank will make the amount of its Pro Rata Share
of each Borrowing available to the Agent for the account of the Borrower at the
Agent's Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by the Borrower in funds immediately available to the Agent. The
proceeds of all such Loans will then be made available to the Borrower by the
Agent by (i) wire transfer of immediately available funds to the Borrower at,
Xxxxxx Trust, ABA No. 071 000 288, Account No. 0000000, for credit to Storage
Technology Corporation or such other account as the Borrower shall specify to
the Agent or (ii) at the option of the Borrower, by crediting the account of
the Borrower on the books of BofA with the aggregate of the amounts made
available to the Agent by the Banks and, in each case, in like funds as
received by the Agent.
(d) After giving effect to any Borrowing, unless the
Agent shall otherwise consent, there may not be more than five different
Interest Periods in effect.
(e) Any Notice of Borrowing received after the time noted
in subsection 2.3(a) but prior to 5:00 p.m. (San Francisco time) on any
Business Day, shall be deemed to have been received prior to 9:00 a.m. (San
Francisco time) on the next Business Day.
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2.4 Conversion and Continuation Elections. (a) The Borrower may
with respect to its Loans, upon irrevocable written notice to the Agent in
accordance with subsection 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 Revolving Loans, to convert
any such Revolving Loans (or any part thereof in an amount not less
than $10,000,000, or that is in an integral multiple of $1,000,000 in
excess thereof) into Revolving Loans of any other Type; or
(ii) elect as of the last day of the applicable
Interest Period, to continue any Revolving Loans having Interest
Periods expiring on such day (or any part thereof in an amount not
less than $10,000,000, 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 $10,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the
right of the Borrower to continue such Revolving Loans as, and convert such
Loans into, Offshore Rate Loans shall terminate.
(b) The Borrower shall deliver a Notice of
Conversion/Continuation to be received by the Agent not later than 9:00 a.m.
(San Francisco time) with respect to its Revolving Loans at least (i) three
Business Days in advance of the Conversion/Continuation Date, if the Revolving
Loans of the Borrower are to be converted into or continued as Offshore Rate
Loans; and (ii) on the Conversion/Continuation Date, if the Revolving Loans of
the Borrower are to be converted into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Revolving Loans to be
converted or continued;
(C) the Type of Revolving Loans resulting from
the proposed conversion or continuation; and
(D) other than in the case of conversions into
Base Rate Loans, the duration of the requested Interest
Period.
(c) If upon the expiration of any Interest Period
applicable to Offshore Rate Loans of the Borrower, the Borrower has failed to
select timely a new Interest Period to be applicable to such Offshore Rate
Loans or if any Default or Event of Default then exists, the Borrower 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 Borrower, the Agent will promptly notify each Bank of the
details of any automatic conversion. All conversions and
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continuations shall be made ratably according to the respective outstanding
principal amounts of the Revolving Loans with respect to which the notice was
given held by each Bank.
(e) Unless the Required Banks otherwise consent, during
the existence of a Default or Event of Default, the Borrower may not elect to
have Loans converted into or continued as an Offshore Rate Loans.
(f) After giving effect to any conversion or continuation
of Revolving Loans, unless the Agent shall otherwise consent, there may not be
more than five different Interest Periods for all Loans in effect.
2.5 Voluntary Termination or Reduction of Commitments.
(a) Termination or Reduction of Commitments. The
Borrower may, upon not less than five Business Days' prior notice to the Agent,
terminate the Commitments, or permanently reduce the Commitments by an
aggregate minimum amount of $10,000,000 or any integral multiple of $1,000,000
in excess thereof; unless, after giving effect thereto and to any prepayments
of any Loans made on the effective date thereof, (a) the Effective Amount of
all Revolving Loans, Swingline Loans and L/C Obligations together would exceed
the amount of the combined Commitments then in effect, or (b) the Effective
Amount of all L/C Obligations then outstanding would exceed the L/C Commitment.
Once reduced in accordance with this Section, the Commitments may not be
increased or reinstated. Any reduction of the Commitments shall be applied to
each Bank's Commitment according to its Pro Rata Share. If and to the extent
specified by the Borrower in the notice to the Agent, some or all of the
reduction in the combined Commitments shall be applied to reduce the L/C
Commitment. All accrued commitment and letter of credit fees to, but not
including, the effective date of any termination of Commitments shall be paid
on the effective date of such termination.
(b) Automatic Reduction of Swingline Commitment. At no
time shall the Swingline Commitment exceed the combined amount of all
Commitments, and any reduction of the combined amount of all Commitments which
reduces the combined amount of all Commitments below the then current amount of
the Swingline Commitment shall result in an automatic corresponding reduction
of the Swingline Commitment to the amount of the combined Commitments, as so
reduced, without any action on the part of the Swingline Bank.
2.6 Optional Prepayments. Subject to Section 4.4, the Borrower
may, at any time or from time to time, upon delivery of an irrevocable Notice
of Prepayment to the Agent prior to 9:00 a.m. (San Francisco time) (a) not less
than three Business Days prior to the date of prepayment in the case of
Offshore Rate Loans, and (b) the same day as the date of prepayment in the case
of Base Rate Loans,
(i) ratably prepay Revolving Loans in whole or in
part, in minimum amounts of $10,000,000 or any integral multiple of
$1,000,000 in excess thereof, and
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(ii) prepay in whole or in part Swingline Loans,
in amounts of $1,000,000 or any integral multiple of $100,000 in
excess thereof, or in other amounts with the consent of the Swingline
Bank.
Any notice of prepayment received after 9:00 a.m. (San
Francisco time) on a Business Day but prior to 5:00 p.m. (San Francisco time)
on such Business Day shall be deemed to have been given prior to 9:00 a.m. (San
Francisco time) on the next Business Day. Any 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 other than
for prepayments of Swingline Loans. If any such notice is given the Borrower
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 4.4.
2.7 Mandatory Prepayments of Loans; Mandatory Commitment
Reductions.
(a) If, on any date that the Total Commitment Amount
automatically decreases pursuant to the terms hereof, the amount of Loans
outstanding exceeds the then-permitted Total Commitment Amount, the Borrower
shall immediately pay such excess amount to the Agent for the ratable benefit
of the Banks. As the Total Commitment Amount available hereunder is reduced,
each Bank's Commitment amount hereunder shall be automatically reduced in
accordance with its Pro Rata Share of the Total Commitment Amount.
(b) If on any date on or prior to the Revolving
Termination Date the Effective Amount of L/C Obligations exceeds the L/C
Commitment, the Borrower shall Cash Collateralize on such date the outstanding
Letters of Credit in an amount equal to the excess of the maximum amount then
available to be drawn under the Letters of Credit over the aggregate L/C
Commitment. Subject to Section 4.4, if on any date after giving effect to any
Cash Collateralization made on such date pursuant to the preceding sentence,
the Effective Amount of all Revolving Loans and Swingline Loans then
outstanding plus the Effective Amount of all L/C Obligations exceeds the
combined Commitments, the Borrower shall immediately, and without notice or
demand, prepay the outstanding principal amount of the Revolving Loans, L/C
Advances and Swingline Loans (as necessary) by an amount equal to the
applicable excess. Additionally, to the extent the Borrower receives any
payments with respect to purchases of Permitted Receivables under the Permitted
Receivables Purchase Facility from BofA or any Affiliate, such payments shall
be immediately used, without demand or notice from any Person, by the Borrower
to prepay the amount of Revolving Loans, L/C Advances and Swingline Loans (as
necessary) by the amounts of any such payments.
2.8 Repayment. The Borrower agrees to repay to the Banks on the
Revolving Termination Date the aggregate principal amount of its Loans
(together with accrued interest and fees thereon) outstanding on such date.
Additionally, with respect to Swingline Loans, the Borrower agrees to repay to
the Swingline Bank the principal amount of each Swingline Loan
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(together with accrued interest and fees thereon) no later than the seventh
Business Day after the date each such Swingline Loan was made.
2.9 Interest. (a) Each Revolving Loan and Swingline Loan shall
bear interest on the outstanding principal amount thereof from the applicable
Borrowing Date at a rate per annum equal to the Offshore Rate or the Base Rate
as the case may be (provided that with respect to Swingline Loans interest
shall only be at the Base Rate unless and until the Swingline Bank agrees to a
different basis pursuant to Section 2.10(a)) and subject also to the Borrower's
right to convert to other Types of Revolving Loans under Section 2.4), plus the
Applicable Margin.
(b) Interest on each Revolving Loan and Swingline Loan of
the Borrower shall be paid by the Borrower in arrears on each Interest Payment
Date. Interest shall also be paid on the date of any prepayment of Loans
(other than Base Rate Loans) under Section 2.6 or 2.7 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 Borrower shall pay
interest (after as well as before entry of judgment thereon to the extent
permitted by law) on the principal amount of all outstanding Obligations, at a
rate per annum which is determined by adding 2% per annum to the Applicable
Margin then in effect for such Loans (other than Base Rate Loans) and, in the
case of Obligations not subject to an Applicable Margin, at a fluctuating rate
per annum equal to the Base Rate plus 2%; 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 fluctuating rate per annum
equal to the Base Rate plus 2%.
(d) Anything herein to the contrary notwithstanding, the
obligations of the Borrower 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 Borrower shall pay such Bank interest at the
highest rate permitted by applicable law.
(e) Subject to the effect of subsection 2.9(a), the
Applicable Margin will be determined by the Agent from time to time in
accordance with the pricing grid set forth in Schedule 2.9(e) based on the most
recent Compliance Certificate delivered by the Borrower pursuant hereto. Such
determination shall be based on the calculations as set forth in such
Compliance Certificate and shall apply from the first Business Day after the
Agent receives such Compliance Certificate until and through the Business Day
when the Agent receives the applicable Compliance Certificate for the next
fiscal quarter.
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The initial Applicable Margin, applicable from the Closing
Date to the date of delivery of the Compliance Certificate hereunder for the
fiscal quarter ending December 1997, shall be as set forth in the Note to
Schedule 2.9(e).
2.10 Swingline Loans.
(a) Subject to the terms and conditions hereof, the
Swingline Bank severally agrees to make a portion of the combined Commitments
available to the Borrower by making swingline loans (individually, a "Swingline
Loan"; collectively, the "Swingline Loans") to the Borrower on any Business Day
during the period from the Closing Date to the Revolving Termination Date in
accordance with the procedures set forth in this Section in an aggregate
principal amount at any one time outstanding not to exceed $25,000,000
notwithstanding the fact that such Swingline Loans, when aggregated with the
Swingline Bank's outstanding Revolving Loans, may exceed the Swingline Bank's
Commitment (the amount of such commitment of the Swingline Bank to make
Swingline Loans to the Borrower pursuant to this subsection 2.10(a), as the
same shall be reduced pursuant to subsection 2.5(b) and Section 2.7 or as a
result of any assignment pursuant to Section 11.8, the Swingline Bank's
"Swingline Commitment"); provided, that at no time shall (i) the sum of the
Effective Amount of all Swingline Loans plus the Effective Amount of all
Revolving Loans plus the Effective Amount of all L/C Obligations exceed the
total of all Commitments, or (ii) the Effective Amount of all Swingline Loans
exceed the Swingline Commitment. Additionally, no more than an aggregate of
three Swingline Loans may be outstanding at any one time, and all Swingline
Loans shall at all times be Base Rate Loans unless otherwise agreed to by the
Swingline Bank in its sole discretion. Within the foregoing limits, and
subject to the other terms and conditions hereof, the Borrower may borrow under
this subsection 2.10(a), prepay pursuant to Section 2.6 and reborrow pursuant
to this subsection 2.10(a).
(b) Each borrowing of a Swingline Loan shall be made upon
the Borrower's irrevocable written notice to the Agent (with a copy to the
Swingline Bank) in the form of a Notice of Borrowing of any Swingline Loan
requested hereunder specifying (i) the amount to be borrowed, and (ii) the
requested Borrowing date, which must be a Business Day (which notice must be
received by the Swingline Bank and the Agent prior to 9:00 a.m. (San Francisco
time) on the requested Borrowing date; any notice received by the Swingline
Bank after 9:00 a.m. (San Francisco time) on a Business Day but before 5:00
p.m. (San Francisco time) on such Business Day shall be deemed to be received
by 9:00 a.m. (San Francisco time) on the next Business Day).
Upon receipt of the Notice of Borrowing, the Swingline Bank
will immediately confirm with the Agent (by telephone or in writing) that the
Agent has received a copy of the Notice of Borrowing from the Borrower and, if
not, the Swingline Bank will provide the Agent with a copy thereof.
Unless the Swingline Bank has received notice prior to 11:30
a.m. on such Borrowing date from the Agent or any Bank (A) directing the
Swingline Bank not to make the requested Swingline Loan as a result of the
limitations set forth in the proviso set forth in the first sentence of
subsection 2.10(a); or (B) that one or more conditions specified in Article V
are not then satisfied; then, subject to the terms and conditions hereof, the
Swingline Bank will, not later
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than 12:30 p.m. (San Francisco time) on the Borrowing date specified in such
Notice, make the amount of its Swingline Loan available to the Agent for the
account of the Borrower at the Agent's Payment Office in funds immediately
available to the Agent. The proceeds of such Swingline Loan will then be made
available to the Borrower by (i) wire transfer of immediately available funds
to the Borrower at, Xxxxxx Trust, ABA No. 071 000 288, Account No. 0000000, for
credit to Storage Technology Corporation or such other account as the Borrower
shall specify to the Agent or (ii) at the option of the Borrower by the Agent
crediting the account of the Borrower on the books of BofA with the aggregate
of the amounts made available to the Agent by the Swingline Bank and in like
funds as received by the Agent. Each Borrowing pursuant to this Section shall
be in an aggregate principal amount equal to $1,000,000 or an integral multiple
of $100,000 in excess thereof, unless otherwise agreed by the Swingline Bank.
(c) The Borrower agrees to repay any Swingline Loan to
the Swingline Bank when required by Section 2.8.
(d) If any Swingline Loans shall remain outstanding
during the existence of a Default or Event of Default and the Swingline Bank
shall in its sole discretion notify the Agent that the Swingline Bank desires
that such Swingline Loans be converted into Revolving Loans, then the Agent
shall be deemed to have received a Notice of Borrowing from the Borrower
pursuant to Section 2.3 requesting that Base Rate Loans be made pursuant to
Section 2.1 on the first Business Day subsequent to the date of such notice
from the Swingline Bank in an amount equal to the aggregate amount of such
Swingline Loans, and the procedures set forth in subsections 2.3(b) and 2.3(c)
shall be followed in making such Base Rate Loans; provided, that such Base Rate
Loans shall be made notwithstanding the Borrower's failure to comply with
subsections 5.2(b) and 5.2(c); and provided, further, that if a Borrowing of
Revolving Loans becomes legally impracticable and if so required by the
Swingline Bank at the time such Revolving Loans are required to be made by the
Banks in accordance with this subsection 2.10(d), each Bank agrees that in lieu
of making Revolving Loans as described in this subsection 2.10(d), such Bank
shall purchase a participation from the Swingline Bank in the applicable
Swingline Loans in an amount equal to such Bank's Pro Rata Share of such
Swingline Loans, and the procedures set forth in subsections 2.3(b) and 2.3(c)
shall be followed in connection with the purchases of such participations.
Upon such purchases of participations the prepayment requirements of subsection
2.10(d) shall be deemed waived with respect to such Swingline Loans. The
proceeds of such Base Rate Loans, or participations purchased, shall be applied
to repay such Swingline Loans.
A copy of each notice given by the Agent to the Banks pursuant
to this subsection 2.10(d) with respect to the making of Revolving Loans, or
the purchases of participations, shall be promptly delivered by the Agent to
the Borrower. Each Bank's obligation in accordance with this Agreement to make
the Revolving Loans, or purchase the participations, as contemplated by this
subsection 2.10(d), shall be absolute and unconditional and shall not be
affected by any circumstance, including (1) any set-off, counterclaim,
recoupment, defense or other right which such Bank may have against the
Swingline Bank, the Borrower or any other Person for any reason whatsoever; (2)
the occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (3) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.
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2.11 Fees. (a) Commitment Fees. In addition to certain fees
described in Section 3.8, the Borrower agrees to pay to the Agent for the
ratable account of each Bank a commitment fee on the average daily unused
portion of such Bank's Commitment, computed on a quarterly basis in arrears on
the last Business Day of each calendar quarter based upon the daily utilization
for that quarter as calculated by the Agent, equal to the amount set forth in
the next paragraph. For purposes of calculation of such unused portion of a
Bank's Commitment, (i) the making of any Swingline Loans shall not be
considered a use of a portion of the Swingline Bank's Commitment, and (ii) each
Bank's Commitment shall be considered used on any date to the extent of its
participation on such date in any Letter of Credit and any L/C Advance made by
it (exclusive of any Swingline Loans).
Such commitment fee shall accrue from the Closing Date to the
Revolving Termination Date and shall be due and payable quarterly in arrears on
(A) the last Business Day of the period ending on December 31, 1997, (B) on the
last Business Day of each calendar quarter commencing after December 31, 1997
and (C) on the Revolving Termination Date; provided that, in connection with
any reduction or termination of Commitments under Section 2.5 or Section 2.7,
the accrued commitment fee calculated for the period ending on such date shall
also be paid on the date of such reduction or termination. The commitment fees
provided in this subsection shall accrue at all times after the above-mentioned
commencement date, including at any time during which one or more conditions in
Article V are not met.
For the period from the Closing Date through the Business Day
when the Agent receives the Borrower's Compliance Certificate for the fiscal
quarter ending December 1997, the Applicable Fee Amount will be the greater of
(i) 0.200% or (ii) the Applicable Fee Amount determined by the Agent in
accordance with the pricing grid set forth in Schedule 2.9(e) based on a
Compliance Certificate of the Borrower for the fiscal quarter ending September
1997 delivered by the Borrower pursuant hereto. Thereafter the Applicable Fee
Amount shall be determined by the Agent from time to time in accordance with
the pricing grid set forth in Schedule 2.9(e) based on the most recent
Compliance Certificate of the Borrower delivered by the Borrower pursuant
hereto. Such determinations shall apply from the first Business Day after the
Agent receives such Compliance Certificate until and through the Business Day
when the Agent receives the applicable Compliance Certificate for the next
fiscal quarter as provided herein.
(b) Arrangement Fee. The Borrower will pay the Agent and
Arranger such other fees as are set forth in that certain fee letter dated
October 22, 1997.
2.12 Computation of Fees and Interest. (a) All computations of
interest for Base Rate Loans when the Base Rate is determined by BofA's
"reference rate" shall be made on the basis of a year of 365 or 366 days, as
the case may be, and actual days elapsed. All other computations of fees and
interest shall be made on the basis of a 360-day year and actual days elapsed
(which results in more interest being paid than if computed on the basis of a
365-day year). Interest and fees shall accrue during each period during which
interest or such fees are computed from the first day thereof to the last day
thereof.
(b) Each determination of an interest rate by the Agent
shall be conclusive and binding on the Borrower and the Banks in the absence of
manifest error.
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2.13 Payments by the Borrower. (a) All payments to be made by the
Borrower shall be made without set-off, recoupment or counterclaim. Except as
otherwise expressly provided herein, all payments by the Borrower 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
10:30 a.m. (San Francisco 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 10:30 a.m. (San Francisco time) 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 Borrower
prior to the date on which any payment is due to the Banks that the Borrower
will not make such payment in full as and when required, the Agent may assume
that the Borrower 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
Borrower 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.
2.14 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 Borrower 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 Borrower 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 Borrower 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 Borrower
of such failure to fund and, upon demand by the Agent, the Borrower 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.
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(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.
2.15 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 ratable share (or other share
contemplated hereunder), 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 Borrower 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 11.10) with respect to such participation as fully as if such Bank
were the direct creditor of each the Borrower 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.
ARTICLE III
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacility. (a) On the terms and
conditions set forth herein (i) the Issuing Bank agrees, (A) from time to time
on any Business Day during the period from the Closing Date to the Revolving
Termination Date to issue Letters of Credit for the account of the Borrower,
and to amend or renew Letters of Credit previously issued by it, in accordance
with subsections 3.2(c) and 3.2(d), and (B) to honor drafts under the Letters
of Credit; and (ii) the Banks severally agree to participate in Letters of
Credit Issued for the account of the Borrower; provided, that the Issuing Bank
shall not Issue, and no Bank shall be obligated to participate in, any Letter
of Credit if as of the date of Issuance of such Letter of Credit (the "Issuance
Date") (1) the Effective Amount of all L/C Obligations plus the Effective
Amount of all Revolving Loans plus the Effective Amount of all Swingline Loans
exceeds the combined Commitments, (2) the participation of any Bank in the
Effective Amount of all L/C Obligations plus the Effective Amount of the
Revolving Loans plus the Effective Amount of all Swingline Loans of such Bank
exceeds such Bank's Commitment, or (3) the Effective Amount of L/C Obligations
exceeds the L/C Commitment. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrower's ability to obtain Letters of
Credit shall be fully revolving, and,
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accordingly, the Borrower may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit which have expired or which have been drawn
upon and reimbursed.
(b) The Issuing Bank shall not Issue any Letter of Credit
if:
(i) any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to
enjoin or restrain the Issuing Bank from Issuing such Letter of
Credit, or any Requirement of Law applicable to the Issuing Bank or
any request or directive (whether or not having the force of law) from
any Governmental Authority with jurisdiction over the Issuing Bank
shall prohibit, or request that the Issuing Bank refrain from, the
Issuance of letters of credit generally or such Letter of Credit in
particular or shall impose upon the Issuing Bank with respect to such
Letter of Credit any restriction, reserve or capital requirement (for
which the Issuing Bank is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall otherwise impose upon the Issuing
Bank any unreimbursed loss, cost or expense which was not applicable
on the Closing Date and which the Issuing Bank in good xxxxx xxxxx
material to it;
(ii) the Issuing Bank has received written notice
from any Bank (and the Required Banks concur with the determination of
such Bank) or the Agent, on or prior to the Business Day prior to the
requested date of Issuance of such Letter of Credit, that no further
Letters of Credit are to be issued due to a continuing failure to meet
one or more of the applicable conditions contained in Article V and
such notice has not expired or been withdrawn by the applicable Bank
and/or the Agent;
(iii) the expiry date of any requested Letter of
Credit is more than 360 days after the Revolving Termination Date,
unless all of the Banks have approved such expiry date in writing;
(iv) any requested Letter of Credit does not
provide for drafts, or is not otherwise in form and substance
reasonably acceptable to the Issuing Bank, or the Issuance of a Letter
of Credit shall violate any applicable policies of the Issuing Bank
for extensions of credit; or
(v) such Letter of Credit is in a face amount
less than $50,000 or to be denominated in a currency other than
Dollars.
3.2 Issuance, Amendment and Renewal of Letters of Credit. (a)
Each Letter of Credit shall be issued upon the irrevocable written request of
the Borrower received by the Issuing Bank (with a copy sent by the Borrower to
the Agent) at least three Business Days (or such shorter time as the Issuing
Bank may agree in a particular instance in its sole discretion) prior to the
proposed date of issuance. Each such request for issuance of a Letter of
Credit shall be by facsimile, confirmed immediately by an original writing in
the mail, in the form of an L/C Application, and shall specify in form and
detail satisfactory to the Issuing Bank: (i) the proposed date of issuance of
the Letter of Credit (which shall be a Business Day); (ii) the face amount of
the Letter of Credit; (iii) the expiry date of the Letter of Credit; (iv) the
name and address of the beneficiary thereof (which beneficiary may be a Bank or
an Affiliate of a Bank); (v) the
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documents to be presented by the beneficiary of the Letter of Credit in case of
any drawing thereunder; (vi) the full text of any certificate to be presented
by the beneficiary in case of any drawing thereunder; (vii) if such Letter of
Credit will be a standby or commercial documentary Letter of Credit; and (viii)
such other matters as the Issuing Bank may require.
(b) At least two Business Days prior to the Issuance of
any Letter of Credit, the Issuing Bank will confirm with the Agent (by
telephone or in writing) that the Agent has received a copy of the L/C
Application or L/C Amendment Application from the Borrower and, if not, the
Issuing Bank will provide the Agent with a copy thereof. Unless the Issuing
Bank has received notice on or before the Business Day immediately preceding
the date the Issuing Bank is to issue a requested Letter of Credit from the
Agent (A) directing the Issuing Bank not to issue such Letter of Credit because
such issuance is not then permitted under subsection 3.1(a) as a result of the
limitations set forth in clauses (1) through (3) thereof or subsection
3.1(b)(ii); or (B) that one or more conditions specified in Article V are not
then satisfied; then, subject to the terms and conditions hereof, the Issuing
Bank shall, on the requested date, issue a Letter of Credit for the account of
the Borrower in accordance with the Issuing Bank's usual and customary business
practices.
(c) From time to time while a Letter of Credit is
outstanding and prior to the Revolving Termination Date, the Issuing Bank will,
upon the written request of the Borrower received by the Issuing Bank (with a
copy sent by the Borrower to the Agent) at least two Business Days (or such
shorter time as the Issuing Bank may agree in a particular instance in its sole
discretion) prior to the proposed date of amendment, amend any Letter of Credit
issued by it. Each such request for amendment of a Letter of Credit shall be
made by facsimile, confirmed immediately in an original writing, made in the
form of an L/C Amendment Application and shall specify in form and detail
satisfactory to the Issuing Bank: (i) the Letter of Credit to be amended; (ii)
the proposed date of amendment of the Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such other
matters as the Issuing Bank may require. The Issuing Bank shall not amend any
Letter of Credit if: (A) the Issuing Bank would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms of this
Agreement; or (B) the beneficiary of any such Letter of Credit does not accept
the proposed amendment to the Letter of Credit. The Agent will promptly notify
the Banks of the receipt by it of any L/C Application or L/C Amendment
Application.
(d) The Issuing Bank and the Banks agree that, while a
Letter of Credit is outstanding and prior to the Revolving Termination Date, at
the option and upon the written request of the Borrower received by the Issuing
Bank (with a copy sent by the Borrower to the Agent) at least two Business Days
(or such shorter time as the Issuing Bank may agree in a particular instance in
its sole discretion) prior to the proposed date of notification of renewal, the
Issuing Bank shall be entitled to authorize the automatic renewal of any Letter
of Credit issued by it. Each such request for renewal of a Letter of Credit
shall be made by facsimile, confirmed immediately in an original writing, in
the form of an L/C Amendment Application, and shall specify in form and detail
satisfactory to the Issuing Bank: (i) the Letter of Credit to be renewed; (ii)
the proposed date of notification of renewal of the Letter of Credit (which
shall be a Business Day); (iii) the revised expiry date of the Letter of
Credit; and (iv) such other matters as the Issuing Bank may require. The
Issuing Bank shall not renew any Letter of Credit if: (A) the
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Issuing Bank would have no obligation at such time to issue or amend such
Letter of Credit in its renewed form under the terms of this Agreement; or (B)
the beneficiary of any such Letter of Credit does not accept the proposed
renewal of the Letter of Credit.
If any outstanding Letter of Credit for the account of the
Borrower shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the Issuing Bank that such Letter of
Credit shall not be renewed, and if at the time of renewal the Issuing Bank
would be entitled to authorize the automatic renewal of such Letter of Credit
in accordance with this subsection 3.2(d) upon the request of the Borrower but
the Issuing Bank shall not have received any L/C Amendment Application from the
Borrower with respect to such renewal or other written direction by the
Borrower with respect thereto, the Issuing Bank shall nonetheless be permitted
to allow such Letter of Credit to renew, and, notwithstanding anything in this
Agreement to the contrary, the Borrower and the Banks hereby authorize such
renewal and, accordingly, the Issuing Bank shall be deemed to have received an
L/C Amendment Application from the Borrower requesting such renewal; provided,
however, that the aggregate principal amount of all such automatically
renewable Letters of Credit shall not exceed $3,000,000, which amount shall be
a sublimit within the L/C Commitment.
(e) This Agreement shall control in the event of any
conflict with any L/C-Related Document (other than any Letter of Credit).
(f) The Issuing Bank will also deliver to the Agent,
concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or
amendment to or renewal of a Letter of Credit.
3.3 Existing BofA Letters of Credit; Risk Participations, Drawings
and Reimbursements. (a) On and after the Termination Date, the Existing BofA
Letters of Credit shall be deemed for all purposes, including for purposes of
the fees to be collected pursuant to subsections 3.8(a) and 3.8(b), and
reimbursement of costs and expenses to the extent provided herein, Letters of
Credit outstanding under this Agreement and entitled to the benefits of this
Agreement and the other Loan Documents, and shall be governed by the
applications and agreements pertaining thereto and by this Agreement. Each
Bank shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Issuing Bank on the Closing Date a participation in each such
Letter of Credit and each drawing thereunder in an amount equal to the product
of (i) such Bank's Pro Rata Share times (ii) the maximum amount available to be
drawn under such Letter of Credit and the amount of such drawing, respectively.
For purposes of Section 2.1 and subsection 2.11(a), the Existing BofA Letters
of Credit shall, as from the Termination Date, be deemed to utilize pro rata
the Commitment of each Bank.
(b) Immediately upon the Issuance of each Letter of
Credit in addition to those described in subsection 3.3(a), each Bank shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from
the Issuing Bank a participation in such Letter of Credit and each drawing
thereunder in an amount equal to the product of (i) the Pro Rata Share of such
Bank, times (ii) the maximum amount available to be drawn under such Letter of
Credit and the amount of such drawing, respectively. For purposes of Section
2.1, each Issuance of a Letter of
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Credit shall be deemed to utilize the Commitment of each Bank by an amount
equal to the amount of such participation.
(c) In the event of any request for a drawing under a
Letter of Credit by the beneficiary or transferee thereof, the Issuing Bank
will promptly notify the Borrower. The Borrower shall reimburse the Issuing
Bank in Dollars in same day funds (i) by no later than 3:30 p.m. (San Francisco
time) on each Honor Date if the Issuing Bank notifies the Borrower of a request
for a drawing prior to 11:00 a.m. (San Francisco time) on such Honor Date and
(ii) by no later than 11:00 a.m. (San Francisco time) on the day immediately
following each Honor Date if the Issuing Bank notifies the Borrower of a
request for drawing after 11:00 a.m. (San Francisco time) on such Honor Date,
in an amount equal to the amount so paid by the Issuing Bank.
In the event that the Issuing Bank notifies the Borrower
before 11:00 a.m. (San Francisco time) on the Honor Date and the Borrower fails
to reimburse the Issuing Bank for the full amount of any drawing under any
Letter of Credit by 3:30 p.m. (San Francisco time) on the Honor Date, the
Issuing Bank will promptly notify the Agent, and the Borrower shall be deemed
to have requested that Base Rate Loans be made by the Banks to be disbursed on
the Honor Date under such Letter of Credit, subject to the amount of the
unutilized portion of the Revolving Commitment and subject to the conditions
set forth in Section 5.2. In the event that the Borrower receives notice from
the Issuing Bank after 11:00 a.m. (San Francisco time) and does not reimburse
by 11:00 a.m. (San Francisco time) the day immediately following, the Issuing
Bank will promptly notify the Agent, and the Borrower shall be deemed to have
requested that Base Rate Loans be made by the Banks as of the Honor Date under
such Letter of Credit, subject to the amount of the unutilized portion of the
Revolving Commitment and subject to the conditions set forth in Section 5.2.
The Agent shall promptly notify the Banks of the occurrence of such a Base Rate
Loan and the Banks shall thereupon advance their Pro Rata Shares of such Base
Rate Loan.
Any notice given by the Issuing Bank or the Agent pursuant to
this subsection 3.3(c) may be oral if immediately confirmed in writing
(including by facsimile); provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.
(d) Each Bank shall upon any notice pursuant to
subsection 3.3(c) make available to the Agent for the account of the relevant
Issuing Bank an amount in Dollars and in immediately available funds equal to
its Pro Rata Share of the amount of the drawing, and the participating Banks
shall (subject to subsection 3.3(e)) each be deemed to have made a Revolving
Loan consisting of a Base Rate Loan to the Borrower in that amount. Interest
shall accrue on each Bank's obligation to participate in any Base Rate Loan
deemed disbursed pursuant to Section 3.3(c) from the Honor Date to the date
such Bank makes payment pursuant to this Section 3.3(d), at a rate per annum
equal to the Federal Funds Rate in effect from time to time during such period.
For the avoidance of doubt, any Base Rate Loan deemed disbursed under Section
3.3(c) shall for all purposes, including the obligation of the Banks to
participate in such Base Rate Loan, be deemed made as of the Honor date and not
the date of notice of the Agent.
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(e) With respect to any unreimbursed drawing that is not
converted into Revolving Loans consisting of Base Rate Loans to the Borrower in
whole or in part, because of the Borrower's failure to satisfy the conditions
set forth in Section 5.2 or for any other reason, the Borrower shall be deemed
to have incurred from the Issuing Bank an L/C Borrowing in the amount of such
drawing, which L/C Borrowing shall be due and payable on demand (together with
interest) and shall bear interest at a rate per annum equal to the Base Rate
plus 2% per annum, and each Bank's payment to the Issuing Bank pursuant to
subsection 3.3(d) shall be deemed payment in respect of its participation in
such L/C Borrowing and shall constitute an L/C Advance from such Bank in
satisfaction of its participation obligation under this Section 3.3.
(f) Each Bank's obligation in accordance with this
Agreement to make the Revolving Loans or L/C Advances, as contemplated by this
Section 3.3, as a result of a drawing under a Letter of Credit, shall be
absolute and unconditional and without recourse to the Issuing Bank and shall
not be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Bank may have against the Issuing
Bank, the Borrower or any other Person for any reason whatsoever; (ii) the
occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided, however, that each
Bank's obligation to make Revolving Loans under this Section 3.3 is subject to
the conditions set forth in Section 5.2.
3.4 Repayment of Participations. (a) Upon (and only upon) receipt
by the Agent for the account of the Issuing Bank of immediately available funds
from the Borrower (i) in reimbursement of any payment made by the Issuing Bank
under the Letter of Credit with respect to which any Bank has paid the Agent
for the account of the Issuing Bank for such Bank's participation in the Letter
of Credit pursuant to Section 3.3 or (ii) in payment of interest thereon, the
Agent will pay to each Bank, in the same funds as those received by the Agent
for the account of the Issuing Bank, the amount of such Bank's Pro Rata Share
of such funds, and the Issuing Bank shall receive the amount of the Pro Rata
Share of such funds of any Bank that did not so pay the Agent for the account
of the Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any
time to return to the Borrower, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of the
payments made by the Borrower to the Agent for the account of the Issuing Bank
pursuant to subsection 3.4(a) in reimbursement of a payment made under the
Letter of Credit or interest or fee thereon, each Bank shall, on demand of the
Agent, forthwith return to the Agent or the Issuing Bank the amount of its Pro
Rata Share of any amounts so returned by the Agent or the Issuing Bank plus
interest thereon from the date such demand is made to the date such amounts are
returned by such Bank to the Agent or the Issuing Bank, at a rate per annum
equal to the Federal Funds Rate in effect from time to time.
3.5 Role of the Issuing Bank. (a) Each Bank and the Borrower
agrees that, in paying any drawing under a Letter of Credit, the Issuing Bank
shall not have any responsibility to obtain any document (other than any sight
draft, certificates or other documents expressly required by the Letter of
Credit) or to ascertain or inquire as to the validity or accuracy of any such
document or the authority of the Person executing or delivering any such
document.
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(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be liable
to any Bank for: (i) any action taken or omitted in connection herewith at the
request or with the approval of the Banks (including the Required Banks, as
applicable); (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any L/C-Related Document.
(c) The Borrower hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this assumption is not intended to,
and shall not, preclude the Borrower pursuing such rights and remedies as it
may have against the beneficiary or transferee at law or under any other
agreement. No Agent-Related Person, nor any of the respective correspondents,
participants or assignees of the Issuing Bank, shall be liable or responsible
for any of the matters described in clauses (i) through (vii) of Section 3.6;
provided, however, anything in such clauses to the contrary notwithstanding,
that the Borrower may have a claim against the Issuing Bank, and the Issuing
Bank may be liable to the Borrower, to the extent, but only to the extent, of
any direct, as opposed to consequential or exemplary, damages suffered by the
Borrower which the Borrower proves were caused by the Issuing Bank's willful
misconduct or gross negligence or the Issuing Bank's willful failure to pay
under any Letter of Credit after the presentation to it by the beneficiary of a
sight draft and certificate(s) strictly complying with the terms and conditions
of a Letter of Credit. In furtherance and not in limitation of the foregoing:
(i) the Issuing Bank may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary; and (ii) the Issuing Bank shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.
3.6 Obligations Absolute. The obligations of the Borrower under
this Agreement and any L/C-Related Document to reimburse the Issuing Bank for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any
drawing under a Letter of Credit converted into Revolving Loans, shall be
unconditional and irrevocable, and shall be paid strictly in accordance with
the terms of this Agreement and each such other L/C-Related Document under all
circumstances, including the following:
(i) any lack of validity or enforceability of
this Agreement or any L/C-Related Document;
(ii) any change in the time, manner or place of
payment of, or in any other term of, all or any of the obligations of
the Borrower in respect of any Letter of Credit or any other amendment
or waiver of or any consent to departure from all or any of the
L/C-Related Documents;
(iii) the existence of any claim, set-off, defense
or other right that the Borrower may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any Person
for whom any such beneficiary or any such transferee may be acting),
the Issuing Bank or any other Person, whether in connection with this
Agreement,
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the transactions contemplated hereby or by the L/C-Related Documents
or any unrelated transaction;
(iv) any draft, demand, certificate or other
document presented under any Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; or any loss or
delay in the transmission or otherwise of any document required in
order to make a drawing under any Letter of Credit;
(v) any payment by the Issuing Bank under any
Letter of Credit against presentation of a draft or certificate that
does not strictly comply with the terms of any Letter of Credit; or
any payment made by the Issuing Bank under any Letter of Credit to any
Person purporting to be a trustee in bankruptcy, debtor-
in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or
any transferee of any Letter of Credit, including any arising in
connection with any Insolvency Proceeding;
(vi) any exchange, release or non-perfection of
any collateral, or any release or amendment or waiver of or consent to
departure from any other guarantee, for all or any of the obligations
of the Borrower in respect of any Letter of Credit; or
(vii) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including
any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower or a guarantor;
provided, that, notwithstanding the foregoing, the Issuing Bank shall not be
relieved of any liability it may otherwise have as a result of its gross
negligence or willful misconduct.
3.7 Cash Collateral Pledge. (i)(A) Upon the request of the Agent,
if the Issuing Bank has honored any full or partial drawing request on any
Letter of Credit and such drawing has resulted in an L/C Borrowing hereunder,
or (B) unless otherwise consented to by the Banks, if, as of the Revolving
Termination Date, any Letter of Credit may for any reason remain outstanding
and partially or wholly undrawn, or (ii) the occurrence of the circumstances
described in Section 2.7 requiring the Borrower to Cash Collateralize Letters
of Credit, then, the Borrower shall immediately Cash Collateralize the
Obligations in an amount equal to such L/C Obligations. The Borrower hereby
grants the Agent, for the benefit of the Agent, the Issuing Bank, the Swingline
Bank and the Banks, a security interest in all such cash and deposit account
balances. Cash Collateral shall be maintained by the Agent in blocked,
interest bearing deposit accounts at BofA. After the Revolving Termination
Date the Issuing Bank may exercise a right of set off with respect to any such
Cash Collateral deposits it holds and may use such funds to satisfy drawings
under Letters of Credit. Unless otherwise agreed to by the Banks, all such
Cash Collateral (inclusive of accrued interest thereon) shall be returned to
the Borrower only when the L/C Commitment has terminated, all Letters of Credit
have been cancelled and no L/C Obligations are outstanding.
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3.8 Letter of Credit Fees. (a) The Borrower agrees to pay to the
Agent for the benefit of the Banks Letter of Credit fees. The Letter of Credit
fee shall be equal to (i) the rate per annum determined as being the Applicable
Margin for Offshore Rate Loans from time to time multiplied by (ii) the average
daily maximum amount available to be drawn of the outstanding Letters of
Credit. The Letter of Credit fees shall be payable quarterly in arrears on the
last Business Day of each calendar quarter, on the Revolving Termination Date,
and on the date when the last Letter of Credit expires.
(b) The Borrower agrees to pay to the Agent for the
benefit of the Banks an issuance fee for each commercial documentary Letter of
Credit Issued hereunder equal to the greater of (i) $250 and (ii) 0.125% of the
face amount of such commercial documentary Letter of Credit, payable on the
date of Issuance of each such commercial documentary Letter of Credit.
(c) The Borrower shall pay to the Issuing Bank, for its
account, quarterly in arrears on the last Business Day of each calendar
quarter, on the Revolving Termination Date and on the date when the last Letter
of Credit expires, a letter of credit fronting fee for each Letter of Credit
Issued by the Issuing Bank equal to .075% per annum of the average daily
maximum amount available to be drawn of the outstanding Letters of Credit.
(d) The Borrower shall pay to the Issuing Bank from time
to time on demand the normal issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the Issuing Bank
relating to letters of credit as from time to time in effect.
3.9 Uniform Customs and Practice. The Uniform Customs and
Practice for Documentary Credits as published by the International Chamber of
Commerce most recently at the time of issuance of any Letter of Credit shall
(unless otherwise expressly provided in the Letters of Credit) apply to the
Letters of Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes. (a) Any and all payments by the Borrower to each Bank
or the Agent under this Agreement and any other Loan Document shall be made
free and clear of, and without deduction or withholding for, any Taxes. In
addition, the Borrower shall pay all Taxes.
(b) If the Borrower shall be required by law to deduct or
withhold any Taxes from or in respect of any sum payable hereunder to any Bank
or the Agent, then:
(i) the sum payable shall be increased as
necessary so that, after making all required deductions and
withholdings (including deductions and withholdings applicable to
additional sums payable under this Section), such Bank or the Agent,
as the case may be, receives and retains an amount equal to the sum it
would have received and retained had no such deductions or
withholdings been made;
(ii) the Borrower shall make such deductions and
withholdings; and
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(iii) the Borrower shall pay the full amount
deducted or withheld to the relevant taxing authority or other
authority in accordance with applicable law.
(c) The Borrower agrees to indemnify and hold harmless
each Bank for the full amount of Taxes in the amount (without duplication of
other amounts paid pursuant to this Section 4.1) that the respective Bank
specifies as necessary to preserve the after-tax yield (which after tax yield
is intended to compensate each Bank for Taxes deducted or withheld pursuant to
this Section 4.1 and additional Taxes imposed on amounts payable pursuant to
this Section 4.1) the Bank would have received if such Taxes had not been
imposed, and any liability (including penalties, interest, and expenses)
arising therefrom or with respect thereto, whether or not such Taxes were
correctly or legally asserted. Payment under this indemnification shall be
made within 30 days after the date the Bank or the Agent makes written demand
therefor, which demand shall specify in reasonable detail the basis for such
demand.
(d) Within 30 days after the date of any payment by the
Borrower of Taxes, the Borrower shall furnish to such Bank or the Agent the
original or a certified copy of a receipt evidencing payment thereof, or other
evidence of payment satisfactory to such Bank or the Agent.
(e) Without affecting its rights under this Section 4.1
or any provision of this Agreement, the Agent, each Bank, the Swingline Bank
and the Issuing Bank agree that if any Taxes are imposed and required by law to
be paid or to be withheld from any amount payable to such Bank or its Lending
Office, the Swingline Bank or the Issuing Bank, as the case may be, with
respect to which the Borrower would be obligated pursuant to this Section 4.1
to increase any amounts payable to such Bank, the Swingline Bank or the Issuing
Bank, as the case may be, or to pay any such Taxes, such Bank shall use
reasonable efforts to select an alternative Lending Office, the Swingline Bank
shall use reasonable efforts to select an alternative office for purposes of
making and receiving payments in respect of Swingline Advances, and the Issuing
Bank shall use reasonable efforts to select an alternative office for purposes
of issuing and receiving payments in respect of Letters of Credit, as the case
may be, which would not result in the imposition of such Taxes; provided,
however, that none of the Agent, the Banks, the Swingline Bank or the Issuing
Bank shall be obligated to select any such alternative office if such Bank, the
Swingline Bank or the Issuing Bank, as the case may be, determines that (i) as
a result of such selection it would be in violation of an applicable law,
regulation, or treaty, or would incur additional costs or expenses or (ii) such
selection would be inadvisable for regulatory reasons or inconsistent with the
interests of such Bank, the Swingline Bank or the Issuing Bank, as the case may
be.
(f) So long as no Default or Event of Default shall have
occurred and be continuing, the Borrower may, within the 30 day period
commencing on the day that the Borrower receives a demand for the payment of
Taxes from any Bank pursuant to this Section 4.1, demand that the Bank making
such demand be replaced with a Person that is an Eligible Assignee selected by
the Borrower and subject to consent by the Agent. Upon any such demand by the
Borrower, if the Agent shall have consented to the Eligible Assignee selected
by the Borrower (provided that should such Eligible Assignee be a Bank, such
Bank shall also have consented to such selection), the Bank that made a demand
pursuant to this Section 4.1 shall
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execute and deliver an Assignment and Acceptance to the Agent pursuant to which
such Bank shall assign all of its rights and obligations under this Agreement
and the other Loan Documents to the Eligible Assignee selected by the Borrower.
4.2 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 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 such Bank to the Borrower through the
Agent, any obligation of that Bank to make Offshore Rate Loans shall be
suspended until the Bank notifies the Agent and the Borrower that the
circumstances giving rise to such determination no longer exist. Any Bank
notifying the Borrower of such a suspension of its obligation to make Offshore
Rate Loans shall provide to the Borrower reasonable documentation supporting
such obligation.
(b) If a Bank determines that it is unlawful to maintain
any Offshore Rate Loan, the Borrower 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 4.4, either on the last day
of the Interest Period thereof, if such Bank may lawfully continue to maintain
such Offshore Rate Loans to such day, or immediately, if such Bank may not
lawfully continue to maintain such Offshore Rate Loan. If the Borrower is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Borrower shall borrow from the affected Bank, in the amount of
such repayment, a Base Rate Loan. Any Bank making such a demand for prepayment
of Offshore Rate Loans shall provide to the Borrower reasonable documentation
supporting such demand.
4.3 Increased Costs and Reduction of Return. (a) If any Bank
determines that, due to either (i) the introduction of or any change in or in
the interpretation of any law or regulation by any Governmental Authority
having jurisdiction over the Banks or (ii) the compliance by any 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 or participating in Letters of Credit, or, in the case of
the Issuing Bank, any increase in the cost to the Issuing Bank of agreeing to
issue, issuing or maintaining any Letter of Credit or of agreeing to make or
making, funding or maintaining any unpaid drawing under any Letter of Credit,
then the Borrower shall be liable for, and shall from time to time, upon demand
(with a copy of such demand to be sent to the Agent), promptly (and in any
event within 30 days) pay to the Agent for the account of such Bank, additional
amounts as are sufficient to compensate such Bank for such increased costs.
Any Bank making such a demand for payment shall provide to the Borrower
reasonable documentation supporting such demand.
(b) If any Bank shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or administration
of any Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by the Bank (or its Lending Office) or any corporation controlling
the Bank with any
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Capital Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by such Bank or any corporation
controlling such Bank and (taking into consideration such Bank's or such
corporation's policies with respect to capital adequacy) determines that the
amount of such capital is increased as a consequence of its Commitments, loans,
credits or obligations under this Agreement, then, upon demand of such Bank to
the Borrower through the Agent, the Borrower shall promptly (and in any event
within 30 days) pay to such Bank, from time to time as specified by such Bank,
additional amounts sufficient to compensate such Bank for such increase. Any
Bank making such a demand for payment shall provide to the Borrower reasonable
documentation supporting such demand.
4.4 Funding Losses. The Borrower shall reimburse each Bank and
hold each Bank harmless from any loss or expense which the Bank sustains or
incurs as a consequence of:
(a) the failure of the Borrower to make on a timely basis
any payment of principal of any Offshore Rate Loan;
(b) the failure of the Borrower to borrow, continue or
convert a Loan after the Borrower has given (or is deemed to have given) a
Notice of Borrowing or a Notice of Conversion/Continuation;
(c) the failure of the Borrower 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 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.
4.5 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
borrowing of Offshore Rate Loans or conversion into or continuation of Offshore
Rate Loans, or that the Offshore Rate applicable pursuant to Section 2.9 for
any requested Interest Period with respect to a proposed borrowing of Offshore
Rate Loans or conversion into or continuation of Offshore Rate Loans does not
adequately and fairly reflect the cost to the Agent or any Bank of funding such
Loans, the Agent will promptly so notify the Borrower and each Bank and will
provide such Persons with reasonable documentation supporting such
determination. Thereafter, the obligation of the Banks to make or maintain
Offshore Rate Loans hereunder shall be suspended until the Agent shall notify
the Borrower and the Banks that the circumstances causing such suspension no
longer exist. Upon receipt of such notice, the Borrower may revoke any Notice
of Borrowing or Notice of Conversion/Continuation then submitted by it. If the
Borrower does not revoke such Notice, the Banks shall make, convert
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or continue the Loans, as proposed by the Borrower, in the amount specified in
the applicable notice submitted by the Borrower, but such Loans shall be made,
converted or continued as Base Rate Loans instead of Offshore Rate Loans.
4.6 Survival. The agreements and obligations of the Borrower in
this Article IV shall survive the payment of all other Obligations.
4.7 Notice of Claims. The Agent or the appropriate Bank will
notify the Borrower in writing of its claims under Article IV within 180 days
after any officer of the Agent or such Bank having principal responsibility for
monitoring the Borrower's performance of its obligations under the Loan
Documents has actual knowledge of facts giving rise to a claim under Article
IV.
ARTICLE V
CONDITIONS PRECEDENT
5.1 Conditions to Agreement. The effectiveness of this Agreement
is subject to the condition that the Agent shall have received on or before the
Closing Date all of the following, in form and substance satisfactory to the
Agent and each Bank, and in sufficient copies for each Bank (other than the
Notes to be delivered pursuant to Section 5.1(a)):
(a) Credit Agreement and Notes. This Agreement and Notes
executed by the Borrower for Banks requesting Notes.
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of
directors of the Borrower authorizing the transactions contemplated
hereby, certified as of the Closing Date by the Secretary or an
Assistant Secretary of the Borrower; and
(ii) A certificate of the Secretary or Assistant
Secretary of the Borrower certifying the names and true signatures of
the officers of the Borrower authorized to execute, deliver and
perform, as applicable, this Agreement, and all other Loan Documents
to be delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the
following documents:
(i) the articles or certificate of incorporation
and the bylaws of the Borrower as in effect on the Closing Date,
certified by the Secretary or Assistant Secretary of the Borrower as
of the Closing Date; and
(ii) a good standing and tax good standing
certificate for the Borrower from the Secretary of State (or similar,
applicable Governmental Authority) of its state of incorporation and
from the State of Colorado;
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(d) Legal Opinions. Opinions of Shearman & Sterling and
internal counsel to the Borrower addressed to the Agent and the Banks,
substantially in the forms of Exhibit D-1 and Exhibit D-2, respectively.
(e) Payment of Fees. Evidence of payment by the Borrower
of all accrued and unpaid fees, costs and expenses to the extent then due and
payable on the Closing Date, including any such costs, fees and expenses
arising under or referenced in Sections 2.11 and 11.4, provided that the
Borrower shall have been given reasonably detailed bills for the fees and
services of the Agent's legal counsel at least one Business Day prior to the
Closing Date if it is to pay such fees and expenses on the Closing Date;
(f) Certificate. A certificate signed by a Responsible
Officer of the Borrower, dated as of the Closing Date, stating that:
(i) the representations and warranties contained
in Article VI 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.
(g) Other Documents. Such other approvals, opinions,
documents or materials as the Agent or any Bank may reasonably request.
5.2 Conditions to All Credit Extensions. The obligation of each
Bank to make any Revolving Loan to be made by it (including its initial
Revolving Loan) or to continue or convert any Revolving Loan under Section 2.4
and the obligation of the Issuing Bank to Issue any Letter of Credit (including
the initial Letter of Credit) is subject to the satisfaction of the following
conditions precedent on the relevant Borrowing Date, Conversion/Continuation
Date or Issuance Date:
(a) Prior Loan Documents. The Agent shall have received,
in a form and substance satisfactory to it, an irrevocable termination notice
from the Borrower delivered pursuant to the terms of the Prior Loan Documents,
requesting the reduction of the Commitments (as defined in the Prior Loan
Documents) to zero and terminating the Prior Loan Documents as of a date five
Business Days after the date of such termination notice (the "Effective Date").
The Borrower hereby represents to the Agent and the Banks that there are no
Loans outstanding under the Prior Loan Documents and that the only Letters of
Credit (as defined in the Prior Loan Documents) issued and outstanding under
the Prior Loan Documents as of the date of this Agreement are those listed in
Schedule 5.2(a). The Borrower covenants with the Agent and the Banks that it
shall not after the date of this Agreement request any Revolving Loans nor the
issuance of any Letters of Credit (as such terms are defined in the Prior Loan
Documents) under the Prior Loan Documents. The Borrower shall take all steps
necessary to effect a termination of the Prior Loan Documents and shall use its
best efforts to ensure that such termination is completed on the Effective
Date. The aggregate amount of Loans and maximum exposure under Letters of
Credit issued pursuant to this Agreement when aggregated with the maximum
exposure under Letters of Credit (as defined in the Prior Loan Documents)
issued and
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outstanding pursuant to the Prior Loan Documents shall at no time exceed
$350,000,000. Letters of Credit (as defined in the Prior Loan Documents) shall
be deemed to utilize the Commitments in an amount equal to the maximum exposure
relating thereto.
(b) Notice, Application. The Agent shall have received (with, in
the case of the initial Revolving Loan only, a copy for each Bank) a Notice of
Borrowing or a Notice of Conversion/Continuation, as applicable or in the case
of any Issuance of any Letter of Credit, the Issuing Bank and the Agent shall
have received an L/C Application or L/C Amendment Application, as required
under Section 3.2;
(c) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on and
as of such Borrowing Date or Conversion/Continuation Date or Issuance Date with
the same effect as if made on and as of such Borrowing Date or
Conversion/Continuation Date or Issuance Date; and
(d) No Existing Default. No Default or Event of Default shall
exist or shall result from such Borrowing or continuation or conversion or
Issuance.
(e) Cash Collateral. With regard to any Letter of Credit, such
Letter of Credit has been cash collateralized to the extent required by and in
accordance with this Agreement.
Each Notice of Borrowing, Notice of Conversion/Continuation and L/C Application
or L/C Amendment Application submitted by the Borrower hereunder shall
constitute a representation and warranty by the Borrower hereunder, as of the
date of each such notice and as of each Borrowing Date, Conversion/Continuation
Date, or Issuance Date, as applicable, that the conditions in this Section 5.2
are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agent and each Bank that:
6.1 Corporate Existence and Power. The Borrower and each of its
Material 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, in the case of the Borrower, perform
its obligations under the Loan Documents;
(c) is duly qualified, licensed and in good standing
under the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification or license
or good standing; and
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(d) is in compliance with all Requirements of Law;
except, in each case referred to in clause (c) or clause (d), to the extent
that the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
6.2 Corporate Authorization; No Contravention. The execution,
delivery and performance by the Borrower of this Agreement and each other Loan
Document to which the Borrower is party, have been duly authorized by all
necessary corporate action, and do not:
(a) contravene the terms of any of such the Borrower's
Organization Documents;
(b) conflict with or result in any breach or
contravention of any document evidencing any Contractual Obligation to which
the Borrower is a party or any order, injunction, writ or decree of any
Governmental Authority to which the Borrower or its property is subject, except
where such conflict, breach or contravention would not cause a Material Adverse
Effect or render any Loan Document unenforceable against the Borrower or any
other Person;
(c) violate any Requirement of Law except, in each case,
where any such contravention, conflict, breach, or violation would not cause a
Material Adverse Effect or render any Loan Document unenforceable against the
Borrower or any other Person; or
(d) result in the creation of any Lien.
6.3 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 current enforcement against, the
Borrower or any of its Material Subsidiaries of the Agreement or any other Loan
Document.
6.4 Binding Effect. This Agreement and each other Loan Document
to which the Borrower is a party constitute (or, when duly executed and
delivered, shall constitute) the legal, valid and binding obligations of the
Borrower, enforceable against it in accordance with their respective terms and
claims under this Agreement and each Loan Document will rank at least pari
passu with the claims of other unsecured creditors, except as enforceability
may be limited by applicable bankruptcy, insolvency, or similar laws affecting
the enforcement of creditors' rights generally or by equitable principles
relating to enforceability.
6.5 Litigation. Except as specifically disclosed in Schedule 6.5,
there are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of the Borrower, threatened or contemplated, at law, in equity,
in arbitration or before any Governmental Authority, against the Borrower, or
its Subsidiaries or any of their respective properties which:
(a) relates to this Agreement or any other Loan Document,
or any of the transactions contemplated hereby or thereby; or
(b) if determined adversely to the Borrower or its
Subsidiaries, would reasonably be expected to have a Material Adverse Effect.
No injunction, writ, temporary restraining order or any order of any nature has
been issued by any court or other Governmental
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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.
6.6 No Default. No Default or Event of Default exists or would
result from the incurring of any Obligations by the Borrower. Neither the
Borrower 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 subsection 9.1(e).
6.7 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
law. Each Plan which is intended to qualify under Section 401(a) of the Code
has received a favorable determination letter from the IRS and to the best
knowledge of the Borrower, nothing has occurred which would cause the loss of
such qualification. The Borrower and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the
Borrower, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan which has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably
expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability;
(iii) neither the Borrower 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 Borrower nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer
Plan; and (v) neither the Borrower nor any ERISA Affiliate has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
6.8 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 7.11 and Section 8.6. Neither the Borrower nor any Subsidiary is
generally engaged in the business of purchasing or selling Margin Stock or
extending credit for the purpose of purchasing or carrying Margin Stock. To
the extent that the Borrower uses Loan proceeds to acquire shares of its own
stock which is Margin Stock, the Borrower intends to cause such acquired shares
to be immediately retired.
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6.9 Title to Properties; Liens. The Borrower and each Subsidiary
have good record and marketable title in fee simple to, or valid leasehold
interests in, all real property necessary or used in the ordinary conduct of
their respective businesses, except for such defects in title as would not,
individually or in the aggregate, have a Material Adverse Effect. As of the
Closing Date the property (real or personal, tangible or intangible) of the
Borrower and its Material Subsidiaries is subject to no Liens, other than
Permitted Liens.
6.10 Taxes. The Borrower and its Subsidiaries have filed or caused
to be filed all federal and other material tax returns and reports required to
be filed, and have paid or caused to be 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
(i) those which are being contested in good faith by appropriate proceedings
and for which adequate reserves have been provided in accordance with GAAP and
(ii) those for which the failure to pay would not have a Material Adverse
Effect. To the Borrower's knowledge, there is no proposed tax assessment
against the Borrower or any Subsidiary that would, if made, have a Material
Adverse Effect.
6.11 Financial Condition. (a) The unaudited Consolidated financial
statements of the Borrower and its Subsidiaries dated for the fiscal quarter
ending June 1997 (as set forth in the Borrower's latest Form 10-Q filing dated
August 8, 1997) and the related Consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal year ended on
that date:
(i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein;
(ii) fairly present the financial condition of the
Borrower and its Subsidiaries as of the date thereof and results of
operations for the period covered thereby; and
(iii) except as specifically disclosed in Schedule
6.11, show all material indebtedness and other liabilities, direct or
contingent, of the Borrower and its Consolidated Subsidiaries as of
the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(b) Since the end of the fiscal quarter ending June 1997
there has been no Material Adverse Effect.
6.12 Environmental Matters. The Borrower conducts in the ordinary
course of business a review of the effect of existing Environmental Laws and
existing Environmental Claims on its business, operations and properties, and
as a result thereof the Borrower has reasonably concluded that, except as
specifically disclosed in Schedule 6.12, such Environmental Laws and
Environmental Claims could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
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6.13 Regulated Entities. Neither the Borrower, nor any Person
controlling the Borrower, nor any Subsidiary, is an "Investment Company" within
the meaning of the Investment Company Act of 1940. The Borrower 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.
6.14 Copyrights, Patents, Trademarks and Licenses, Etc. The
Borrower or its Subsidiaries own or are licensed or otherwise have the right to
use all of the patents, trademarks, service marks, trade names, copyrights,
contractual franchises, authorizations and other rights that are reasonably
necessary for the operation of their respective material businesses, without
conflict with the rights of any other Person. To the best knowledge of the
Borrower, no slogan or other advertising device, product, process, method,
substance, part or other material now employed, or now contemplated to be
employed, by the Borrower or any Material Subsidiary infringes upon any rights
held by any other Person. Except as specifically disclosed in Schedule 6.5, no
claim or litigation regarding any of the foregoing is pending or, to the best
knowledge of the Borrower, threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of the Borrower, proposed, which, in either
case, could reasonably be expected to have a Material Adverse Effect.
6.15 Subsidiaries. The Borrower (a) has no Subsidiaries other than
those specifically disclosed in part (a) of Schedule 6.15 hereto as of the
Closing Date and (b) has no equity investments in any other corporation or
entity other than those specifically disclosed in part (b) of Schedule 6.15
except, in each case, for Subsidiaries created and equity investments made
after the Closing Date and otherwise permitted by this Agreement.
6.16 Insurance. Except as specifically disclosed in Schedule 6.16,
the properties of the Borrower and its Material Subsidiaries are insured with,
to the best knowledge of the Borrower, financially sound and reputable
insurance companies not Affiliates of the Borrower, 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 Borrower or such Material Subsidiary operates.
6.17 Full Disclosure. None of the representations or warranties
made by the Borrower 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 written exhibit, report, statement or certificate
furnished by or on behalf of the Borrower or any Subsidiary in connection with
the Loan Documents (including the offering and disclosure materials delivered
by or on behalf of the Borrower 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 of the circumstances under which they are made, not misleading as of
the time when made or delivered; provided that nothing in this Section 6.17
shall apply to any projections, forward-looking information or other similar or
related information furnished by or on behalf of the Borrower or any Subsidiary
in connection with the Loan Documents.
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6.18 Projections. All projections forward-looking information or
other similar or related information furnished by or on behalf of the Borrower
or any Subsidiary in connection with the Loan Documents were prepared in good
faith on the basis of the assumptions stated therein, which assumptions were
fair in the light of conditions existing at the time of delivery of such
forecasts, and represented, at the time of delivery, the Borrower or such
Subsidiary's best estimate of its future financial performance, operations and
results.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Banks waive compliance in
writing:
7.1 Financial Statements. The Borrower shall deliver to the
Agent, in form and detail satisfactory to the Agent and the Required Banks,
with sufficient copies for each Bank:
(a) as soon as available, but not later than 120 days
after the end of each fiscal year, a copy of the audited Consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of such year and the
related Consolidated statements of income or operations, shareholders' equity
and cash flows for such year, setting forth in each case in comparative form
the figures for the previous fiscal year, and accompanied by the opinion of
Price Waterhouse or another nationally-recognized independent public accounting
firm ("Independent Auditor") which report shall state that such Consolidated
financial statements present fairly the financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years. Such opinion shall not be qualified or limited because of a restricted
or limited examination by the Independent Auditor of any material portion of
the Borrower's or any Subsidiary's records;
(b) as soon as available, but not later than 55 days
after the end of each of the first three fiscal quarters of each fiscal year, a
copy of the unaudited Consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such quarter and the related Consolidated
statements of income, shareholders' equity and cash flows for the period
commencing on the first day and ending on the last day of such quarter, and
certified by a Responsible Officer as fairly presenting, in accordance with
GAAP (subject to ordinary, good faith year-end audit adjustments), the
financial position and the results of operations of the Borrower and the
Subsidiaries.
7.2 Certificates; Other Information. The Borrower shall furnish
to the Agent with sufficient copies for each Bank:
(a) concurrently with the delivery of the financial
statements referred to in subsections 7.1(a) and (b), a Compliance Certificate
executed by a Responsible Officer;
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(b) promptly, copies of all financial statements and
reports that the Borrower sends to its shareholders, and copies of all
financial statements and regular, periodical or special reports (including
Forms 10-K, 10-Q and 8-K) that the Borrower or any Subsidiary may make to, or
file with, the SEC; and
(c) promptly, such additional information regarding the
business, financial or corporate affairs of the Borrower or any Subsidiary as
the Agent, at the request of any Bank, may from time to time reasonably
request.
7.3 Notices. The Borrower shall promptly notify the Agent and
each Bank:
(a) after a Responsible Officer of the Borrower knows or
has reason to know of the occurrence of any Default or Event of Default, and of
the occurrence or existence of any event or circumstance for which it is
reasonably foreseeable that such event or circumstance will become a Default or
Event of Default;
(b) after a Responsible Officer of the Borrower or any
ERISA Affiliate knows or has reason to know that any material ERISA Event has
occurred, with a statement of a Responsible Officer of the Borrower describing
such ERISA Event and the action, if any, that the Borrower or such ERISA
Affiliate proposes to take with respect thereto; and
(c) of any material change in accounting policies or
financial reporting practices by the Borrower or any of its Consolidated
Subsidiaries.
Each notice under this Section shall be accompanied by a
written statement by a Responsible Officer setting forth details of the
occurrence referred to therein, and stating what action the Borrower or any
affected Subsidiary proposes to take with respect thereto and at what time.
Each notice under subsection 7.3(a) shall describe with particularity any and
all clauses or provisions of this Agreement or other Loan Document that have
been (or foreseeably will be) breached or violated.
7.4 Preservation of Corporate Existence, Etc. The Borrower shall,
and shall cause each Material Subsidiary to preserve and maintain in full force
and effect its corporate existence and good standing under the laws of its
state or jurisdiction of incorporation and preserve and maintain in full force
and effect all governmental rights, privileges, qualifications, permits,
licenses and franchises necessary or desirable in the normal conduct of its
business except (a) if in the reasonable business judgment of the Borrower or
such Material Subsidiary, it is in its best economic interest not to preserve
or maintain such rights, privileges, qualification, permits, licenses or
franchises and (b) unless no Material Adverse Effect could result.
7.5 Maintenance of Property. The Borrower shall maintain, and
shall cause each Material Subsidiary to maintain, and preserve all its material
property (including, without limitation, equipment) which is used or useful in
its business in good working order and condition, ordinary wear and tear
excepted and make all necessary repairs thereto and renewals and replacements
thereof except where the failure to do so could not reasonably be expected to
50.
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have a Material Adverse Effect. The Borrower and each Material Subsidiary
shall use the standard of care typical in the industry in the operation and
maintenance of its facilities.
7.6 Insurance. The Borrower shall maintain, and shall cause each
Material Subsidiary to maintain, with financially sound and reputable
independent insurers, insurance against loss or damage of the kinds customarily
insured against by Persons engaged in the same or similar business, of such
types and in such amounts as are customarily carried under similar
circumstances by such other Persons.
7.7 Payment of Obligations. The Borrower shall, and shall cause
each Material Subsidiary to, pay and discharge before the same shall become
delinquent:
(a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same are
being contested in good faith by appropriate proceedings and adequate reserves
in accordance with GAAP are being maintained by the Borrower or such Material
Subsidiary; and
(b) all lawful claims which, if unpaid, would by law
become a Lien upon its property.
7.8 Compliance with Laws. The Borrower shall comply, and shall
cause each Subsidiary to comply, in all material respects with all Requirements
of Law of any Governmental Authority having jurisdiction over it or its
business (including Environmental laws and the federal Fair Labor Standards
Act), except such as may be contested in good faith or as to which a bona fide
dispute may exist.
7.9 Compliance with ERISA. The Borrower 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.
7.10 Inspection of Property and Books and Records. The Borrower
shall maintain and shall cause each Material Subsidiary to maintain proper
books of record and account, in which full, true and correct entries in
conformity with GAAP consistently applied shall be made of all financial
transactions and the assets and business of the Borrower and such Material
Subsidiary. During the continuance of any Event of Default, the Borrower shall
permit, and shall cause each Subsidiary to permit, representatives and
independent contractors of the Agent or any Bank to visit and inspect any of
their respective properties, to examine their respective corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the expense of
each the Borrower and at such reasonable times during normal business hours and
as often as may be reasonably desired, upon reasonable advance notice to each
the Borrower.
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7.11 Use of Proceeds. The Borrower shall use the proceeds of the
Loans for working capital and other general corporate purposes (including
repurchases of its own stock) not in contravention of any Requirement of Law or
of any Loan Document.
7.12 Disclosure; Further Assurances.
(a) The Borrower shall ensure that all written
information, exhibits and reports furnished to the Agent and the Banks by or on
behalf of the Borrower and concerning the Borrower do not and will not contain
any untrue statement of a material fact and do not and will not omit to state
any material fact or any fact necessary to make the statements contained
therein not misleading in light of the circumstances in which made, and will
promptly disclose to the Agent and the Banks and correct any material defect or
error that may be discovered therein or in any Loan Document or in the
execution, acknowledgement or recordation thereof; provided that nothing in
this Section 7.12(a) shall apply to any projections, forward-looking
information or other similar or related information furnished by or on behalf
of the Borrower or any Subsidiary in connection with the Loan Documents.
(b) The Borrower shall ensure that all projections,
forward-looking information or other similar or related information furnished
by or on behalf of the Borrower in connection with the Loan Documents are
prepared in good faith on the basis of the assumptions stated therein, which
assumptions are fair in the light of conditions existing at the time of
delivery of such forecasts, and represent, at the time of delivery, the
Borrower or such Subsidiary's best estimate of its future financial
performance, operations and results.
(c) The Borrower shall provide such other documentation
and cooperation as the Agent or the Required Banks reasonably request in
connection with the exercise by the Agent and the Banks of their rights and
remedies under the Loan Documents.
7.13 Financial Covenants. The Borrower will, unless the Required
Banks shall otherwise consent in writing:
(a) Maintenance of Consolidated Tangible Net Worth.
Maintain as at the end of each fiscal quarter a Consolidated Tangible Net Worth
of the Borrower and its Subsidiaries of not less than at any time the amount
that is, (i)(A) the greater of (x) 95% of Consolidated Tangible Net Worth as at
fiscal quarter ending September 1997, and (y) $1,279,000,000, plus (B) 75% of
Consolidated Net Income (excluding any Consolidated Net Loss) of the Borrower
and its Subsidiaries earned in each fiscal quarter after such September 1997
fiscal quarter, plus (C) 75% of the amount of all proceeds (net of costs and
expenses) received pursuant to the issuance of any equity securities issued by
the Borrower after such September 1997 fiscal quarter (excluding proceeds of
any issuance made for the purposes of fulfilling an employee stock purchase
plan or compensatory option plan), plus (D) 100% of the face amount of any
Subordinated Indebtedness that is converted into stock of the Borrower after
such September 1997 fiscal quarter, minus (E) the amount, up to $800,000,000,
paid by the Borrower in respect of repurchases of its stock, minus (F) an
amount equal to the costs and expenses arising from or related to mergers and
acquisitions consummated by the Borrower and its Subsidiaries and recognized in
accordance with GAAP, provided that all such amounts recognized shall be
accounted for in the fiscal
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quarter in which the relevant merger or acquisition is consummated and,
provided further, that the total amount of costs and expenses which may be
excluded pursuant to this subsection (F) shall at no time exceed $100,000,000
in the aggregate during the initial term of this Agreement.
(b) Consolidated Net Income. Not permit (i) any
Consolidated Net Loss or Consolidated Operating Loss of the Borrower and its
Subsidiaries to occur for each of any two consecutive fiscal quarters
(calculated as of the last day of each such fiscal quarter); or (ii)
Consolidated Net Loss or Consolidated Operating Loss of the Borrower and its
Subsidiaries for any fiscal quarter to be greater than $25,000,000; provided
that in determining the Consolidated Net Loss or Consolidated Operating Loss
for any fiscal quarter for the purposes of subparagraphs (i) and (ii) of this
Section 7.13(b) there shall be excluded the amount equal to costs and expenses
arising from or related to mergers and acquisitions consummated by the Borrower
and its Subsidiaries and recognized in accordance with GAAP; provided further,
that all such amounts recognized shall be accounted for in the fiscal quarter
in which the relevant merger or acquisition is consummated and provided that
the total amount of costs and expenses which may be excluded pursuant to this
proviso shall at no time exceed $100,000,000 in the aggregate during the
initial term of this Agreement.
(c) Consolidated Total Leverage Ratio. Not permit the
Consolidated Total Leverage Ratio of the Borrower and its Subsidiaries as
determined at the end of each fiscal quarter during the measurement periods set
forth below to exceed the correlative ratio set forth below:
Period Ratio
------ -----
Closing Date through March 26, 1999 40.0%
March 27, 1999 and thereafter 35.0%
(d) Adjusted Quick Ratio. Maintain a Consolidated
Adjusted Quick Ratio for the Borrower and its Subsidiaries as determined at the
end of each fiscal quarter during each of the measurement periods set forth
below at least equal to the correlative ratio for such period as set forth
below:
Period Ratio
------ -----
Closing Date through December 25, 1998 0.95 : 1.00
December 26, 1998 through September 24, 1999 1.00 : 1.00
September 25, 1999 and thereafter 1.25 : 1.00
7.14 Patents and Permits. The Borrower will, and will cause each
of its Subsidiaries to, (i) maintain all permits, licenses, consents or other
approvals of any Government Authority or any Person and (ii) maintain in full
force and effect and protect patents, trademarks, tradenames or other
intellectual property rights, the failure of which to maintain or protect would
result in a Material Adverse Effect.
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ARTICLE VIII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Banks waive compliance in
writing:
8.1 Limitation on Liens. The Borrower shall not, and shall not
suffer or permit any Material Subsidiary to, directly or indirectly, make,
create, incur, assume or suffer to exist any Lien upon or with respect to any
part of its property, whether now owned or hereafter acquired, other than the
following ("Permitted Liens"):
(a) Liens for taxes, assessments or governmental charges
or levies, and to the extent not past due or to the extent contested, in good
faith, by appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP;
(b) Liens imposed by law, such as materialman's,
mechanic's, carrier's, workman's, and repairman's Liens and other similar Liens
arising in the ordinary course of business which relate to obligations which
are not overdue for a period of more than 45 days or which are being contested
in good faith, by appropriate proceedings and for which adequate reserves have
been established in accordance with GAAP;
(c) pledges or deposits in the ordinary course of
business to secure nondelinquent obligations under xxxxxxx'x compensation or
unemployment laws or similar legislation or to secure the performance of leases
or trade contracts entered into in the ordinary course of business or of public
or nondelinquent statutory obligations, bids, or appeal bonds;
(d) Liens upon or in any property acquired or held by the
Borrower or any of its Subsidiaries to secure the purchase price or
construction costs (and, to the extent financed, sales and excise taxes,
delivery and installation costs and other related expenses) of such property or
to secure indebtedness incurred solely for the purpose of financing or
refinancing the acquisition or construction of any such property to be subject
to such Liens, or Liens existing on any such property at the time of
acquisition, or extensions, renewals or replacements of any of the foregoing
for the same or a lesser principal amount, provided that no such Lien shall
extend to or cover any property other than the property being acquired or
constructed and no such extension, renewal or replacement shall extend to or
cover any property not theretofore subject to the Lien being extended, renewed
or replaced;
(e) Liens consisting of the interest of a lessor upon any
assets subject to a Capital Lease and securing payment of the obligations
arising under such Capital Lease and provided that such Capital Lease is
otherwise permitted hereunder;
(f) zoning restrictions, easements, licenses, landlord's
Liens or restrictions on the use of any real property occupied by the Borrower
or its Subsidiaries, which do not materially
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impair the use of such property in the operation of the business of the
Borrower or any of its Subsidiaries or the value of such property for the
purpose of such business;
(g) Liens associated with judgments and awards to the
extent such judgments and awards do not create an Event of Default under
subsection 9.1(i) hereof;
(h) Liens in favor of the issuer of a documentary
commercial letter of credit, provided, that such Liens are limited exclusively
to the goods covered by such letter of credit;
(i) Liens listed on Schedule 8.1(i) securing Indebtedness
outstanding on the Closing Date;
(j) Liens consisting of the interest of a lessor under
Operating Leases made in the ordinary course of business, or existing on
property leased by the Borrower or its Subsidiaries under an Operating Lease in
the ordinary course of business;
(k) Liens in connection with the Permitted Receivables
Purchase Facility (including liens on Permitted Receivables, software, chattel
paper, books and records related to the Permitted Receivables);
(l) Liens securing borrowings by the Borrower against
life insurance policies under which it is the beneficiary in an aggregate
amount not to exceed $40,000,000;
(m) Liens in connection with the Borrower's credit card
processing program in an aggregate amount not to exceed $20,000,000;
(n) Consensual Liens not described in subclauses (a)
through (m) above that; (i) relate to liabilities other than borrowed money
debt (including Liens incurred in connection with sales and leasebacks of the
Borrower's assets) and securing obligations not in excess of $30,000,000 in the
aggregate at any time for all such Liens for the Borrower and its Subsidiaries
together, or (ii) secure obligations not in excess of $15,000,000 in the
aggregate at any time for all such Liens for the Borrower and its Subsidiaries
together; provided that no Liens otherwise permitted by clause (ii) shall be
permitted against Receivables or inventories of the Borrower or its
Subsidiaries; and provided further that the obligations secured by Liens
permitted pursuant to clauses (i) and (ii) shall at no time, in the aggregate,
exceed $30,000,000; and
(o) Liens with respect to collateral (whether in cash,
letters of credit or other investments) provided in connection with the
Multicurrency Note Purchase Facility; provided that at no time shall the
collateral with respect to the Multicurrency Note Purchase Facility exceed, in
the aggregate, $140,000,000.
8.2 Disposition of Assets. The Borrower shall not, and shall not
suffer or permit any Material Subsidiary to, directly or indirectly, sell,
assign, lease, convey, transfer or otherwise dispose of (whether in one or a
series of transactions) any property (including accounts and notes receivable,
with or without recourse) or enter into any agreement to do any of the
foregoing, except:
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(a) dispositions of inventory, or used, worn-out,
obsolete or surplus equipment or other assets not practically usable in the
business of the Borrower, all in the ordinary course of business;
(b) the sale of equipment to the extent that such
equipment is exchanged for credit against the purchase price of similar
replacement equipment, or the proceeds of such sale are reasonably promptly
applied to the purchase price of such replacement equipment;
(c) dispositions of assets in the ordinary course of
business by the Borrower or any of its Subsidiaries to the Borrower or any
other of its Subsidiaries pursuant to reasonable business requirements;
(d) dispositions of Permitted Receivables (including
software, books and records related to Permitted Receivables) pursuant to the
Permitted Receivables Purchase Facility;
(e) dispositions in connection with a sale/leaseback
transaction involving real or personal property of the Borrower or its
Subsidiaries; provided, that any such sale/leaseback transaction is otherwise
permitted under this Agreement;
(f) dispositions not otherwise permitted hereunder;
provided, that (i) at the time of any disposition, no Event of Default shall
exist or shall result from such disposition, and (ii) the aggregate net book
value of all assets so sold by the Borrower and its Subsidiaries, together,
shall not exceed in any fiscal year an amount equal to 5% of Consolidated Total
Assets of the Borrower for such fiscal year; and
(g) dispositions listed on Schedule 8.2.
8.3 Consolidations and Mergers. The Borrower shall not, and shall
not suffer or permit any Subsidiary 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 substantially all of its assets (whether
now owned or hereafter acquired) to or acquire all or substantially all of the
assets of, any Person, except:
(a) any Subsidiary may merge with the Borrower, provided
that the Borrower shall be the continuing or surviving corporation, or with any
one or more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation;
(b) any Subsidiary may sell all or substantially all of
its assets (upon voluntary liquidation or otherwise), to the Borrower or
another Wholly-Owned Subsidiary; and
(c) to the extent permitted by Section 8.2.
Nothing in this Section 8.3 shall prevent the Borrower or any
of its Subsidiaries from merging with, or acquiring all or substantially all of
the assets of any Person if (i) with respect to a merger, the Borrower or such
Subsidiary party to such merger is the surviving entity
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of such merger, and (ii) the total assets (including securities and all other
assets) so acquired, together with the total assets for all such transactions
occurring after the Closing Date (in each case as measured on the effective
date of such merger or acquisition), do not exceed in any fiscal year an amount
greater than 30% of the Consolidated Tangible Net Worth of the Borrower and its
Subsidiaries for such fiscal year and do not exceed in the aggregate during the
initial term of this Agreement $500,000,000, and (iii) the merger or
acquisition involves an entity engaged in a similar business to that of the
Borrower or in a business within the Borrower's strategic plans; and (iv) no
Default or Event of Default has occurred or would occur from such merger or
acquisition.
If any Acquisition or Investment is hostile, no proceeds of
any Loan or Letter of Credit may be used, directly or indirectly, therefor
("hostile" for purposes of this sentence meaning the prior effective written
consent of the board of directors or equivalent governing body of the acquiree
is not obtained).
8.4 Loans and Investments. The Borrower shall not purchase or
acquire, or suffer or permit any Material Subsidiary to purchase or acquire, or
make any commitment therefor, any capital stock, equity interest, or any
obligations or other securities of, or any interest in, any Person, 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
Borrower (together, but excluding Acquisitions, "Investments"), except for:
(a) Investments held by the Borrower or any Material
Subsidiary in the form of cash equivalents;
(b) extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale or lease of goods or
services in the ordinary course of business;
(c) extensions of credit by the Borrower to any of its
Subsidiaries or by any of its Subsidiaries to another of its Subsidiaries;
(d) (i) Investments in any distributor of the Borrower's
products or any supplier of raw materials or services useful to the business of
the Borrower and its Subsidiaries (other than the acquisition of such Person by
the Borrower or its Subsidiaries), or in any partnership or corporation with
others, (ii) Joint-Ventures and (iii) other Investments, provided, that (A) the
book value (as to the Borrower) of any such Investment or Joint-Venture,
together with such value of all prior Investments or Joint-Ventures described
in clauses (i) through (iii) of this Section 8.4(d) undertaken by the Borrower
and its Subsidiaries after the Closing Date, shall not exceed at the time of
such Investment or Joint Venture, 15% of Consolidated Tangible Net Worth as
calculated as of the most recent fiscal quarter prior to such Investment or
Joint-Venture, (B) such Investments and Joint-Ventures are undertaken in
accordance with all applicable Requirements of Law and (C) immediately prior to
and after giving effect thereto, no Default or Event of Default shall exist or
be continuing;
(e) Investments constituting Permitted Swap Obligations
or payments or advances under Swap Contracts relating to Permitted Swap
Obligations;
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(f) Investments complying with the investment policy for
the Borrower and its Subsidiaries described on Schedule 8.4(f), as such
schedule may be amended from time to time;
(g) contributions, loans or advances to, or guarantees
of, the Borrower or any Subsidiary in connection with the Permitted Receivables
Purchase Facility or the Multicurrency Note Purchase Facility;
(h) loans to employees of the Borrower or any of its
Subsidiaries (i) not to exceed $20,000,000, exclusive of any loans permitted
pursuant to clause (ii), (valued without regard to any write-down due to
uncollectability) at any one time outstanding for all such loans to all
employees of the Borrower and its Subsidiaries in the aggregate, or (ii) in the
ordinary course of business with respect to travel and relocation expenses; and
(i) repurchases of shares of Company stock.
8.5 Transactions with Affiliates. The Borrower shall not, and
shall not suffer or permit any Material Subsidiary to, enter into any
transaction with any Affiliate of the Borrower, except (i) transactions upon
fair and reasonable terms no less favorable to the Borrower or such Material
Subsidiary than it would obtain in a comparable arm's-length transaction with a
Person not an Affiliate of the Borrower or such Material Subsidiary and (ii)
transactions between Material Subsidiaries of the Borrower and transactions
between the Borrower and its Material Subsidiaries on terms fair and reasonable
to all interested parties and undertaken by all such parties in good faith and
in the ordinary course of business.
8.6 Use of Proceeds. The Borrower shall not, and shall not suffer
or permit any Subsidiary to, use any portion of the Loan proceeds or any Letter
of Credit, directly or indirectly, otherwise than in connection with the
purchase of shares of its own stock for immediate cancellation, (i) to purchase
or carry Margin Stock, (ii) to repay or otherwise refinance indebtedness of the
Borrower or others incurred to purchase or carry Margin Stock, (iii) to extend
credit for the purpose of purchasing or carrying any Margin Stock, or (iv) to
acquire any security in any transaction that is subject to Section 13 or 14 of
the Exchange Act.
8.7 Contingent Obligations. The Borrower shall not, and shall not
suffer or permit any Material Subsidiary to, create, incur, assume or suffer to
exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the
ordinary course of business;
(b) Permitted Swap Obligations;
(c) L/C Obligations in favor of BofA or any Affiliate of
BofA in connection with the Permitted Receivables Purchase Facility;
(d) Contingent Obligations in favor of BofA or any
Affiliate of BofA including, without limitation, in the form of recourse to the
Borrower or guaranties by the Borrower in connection with the Permitted
Receivables Purchase Facility or the Multicurrency Note Purchase Facility;
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(e) Contingent Obligations of the Borrower and its
Subsidiaries existing as of the Closing Date and listed in Schedule 8.7(e) and
any renewals, extensions or modifications thereof so long as the aggregate
amount of such Contingent Obligations does not increase from the amount
existing on the Closing Date;
(f) Contingent Obligations incurred in the ordinary
course of business and not exceeding at any time $30,000,000 in the aggregate
in respect of the Borrower and its Subsidiaries together;
(g) Contingent Obligations arising under the Loan
Documents;
(h) Contingent Obligations arising in connection with
Indebtedness of any Subsidiary of the Borrower, provided, that such
Indebtedness is otherwise permitted by this Credit Agreement; and
(i) Contingent Obligations of the Borrower pursuant to
guaranties in favor of Leasetec Corporation and other leasing partners (or any
of their successors or assigns) so long as the aggregate amount thereof does
not exceed at any time $50,000,000.
8.8 Restricted Payments. The Borrower shall not, and shall not
suffer or permit any Subsidiary to, declare or make any dividend payment or
other distribution of assets, properties, cash, rights, obligations or
securities on account of any shares of any class of its capital stock, except
that the Borrower may (so long as there is no Default or Event of Default);
(a) declare and make dividend payments or other
distributions payable solely in its common stock;
(b) declare and make dividend payments in cash with
respect to preferred stock of the Borrower, so long as the aggregate amount of
such cash used by the Borrower pursuant to this clause (b) does not exceed
$20,000,000 in any fiscal year;
provided further that (so long as there is no Default or Event of Default) any
Subsidiary may pay cash dividends or make other distributions to the Borrower
or, in the ordinary course of business of the Borrower and its Subsidiaries
taken as a whole, any other Subsidiary.
8.9 ERISA. The Borrower shall not, and shall not suffer or permit
any of its ERISA Affiliates to: (a) engage in a prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably expected to result in liabilities of the
Borrower in an aggregate amount in excess of $10,000,000; or (b) engage in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
8.10 Change in Business. The Borrower shall not make any material
change in the nature of its business as conducted on the Closing Date.
8.11 Accounting Changes. The Borrower shall not and shall not
suffer or permit any Material Subsidiary to, make any significant change in
accounting treatment or reporting
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practices, except as required by GAAP, or change the fiscal year of each the
Borrower or any Material Subsidiary.
ARTICLE IX
EVENTS OF DEFAULT
9.1 Event of Default. Any of the following events shall
constitute an "Event of Default":
(a) Non-Payment. The Borrower fails to pay, (i) when and
as required to be paid herein, any amount of principal of any Loan or of any
L/C Obligation, or (ii) within two Business 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 Borrower 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 Borrower, 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 Borrower (i) fails to perform
or observe any term, covenant or agreement contained in Sections 7.3, 7.4, 7.11
or 7.13 or in Article VIII; or (ii) fails to perform or observe any term,
covenant or agreement contained in Sections 7.1, 7.2 or 7.9 and such failure
shall continue for five Business Days; or
(d) Other Defaults. The Borrower or any Subsidiary party
thereto 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 earlier of (i) the date upon which
a Responsible Officer knew or reasonably should have known of such failure or
(ii) the date upon which written notice thereof is given to the Borrower by the
Agent or any Bank; or
(e) Cross-Default. The Borrower or any Subsidiary (i)
fails to make any payment in respect of any Indebtedness or Contingent
Obligation (other than Indebtedness or Contingent Obligations hereunder),
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 $20,000,000 when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise)
and such failure shall continue for five Business Days; 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 or Contingent Obligation, 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
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prior to its stated maturity, or such Contingent Obligation to become payable
or cash collateral in respect thereof to be demanded; or
(f) Insolvency; Voluntary Proceedings. The Borrower or
any Material 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 Borrower or any
Material Subsidiary, or any writ, judgment, warrant of attachment, execution or
similar process, is issued or levied against a substantial part of the
Borrower's or any Material 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 Borrower or any
Material 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 Borrower or
any Material 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 shall occur with respect
to a Pension Plan or Multiemployer Plan which has resulted or could reasonably
be expected to result in liability of the Borrower under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of $20,000,000; (ii) the aggregate amount of Unfunded Pension Liability
among all Pension Plans at any time exceeds $20,000,000; or (iii) the Borrower
or any ERISA Affiliate shall fail 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 $20,000,000; or
(i) Monetary Judgments. One or more non-interlocutory
judgments, non-interlocutory orders, decrees or arbitration awards is entered
against the Borrower 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 $20,000,000 or more, and the same
shall remain unvacated and unstayed pending appeal for a period of 10 days
after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment,
order or decree is entered against the Borrower 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
(k) Change of Control. There occurs any Change of
Control; or
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(l) Adverse Change. There occurs a Material Adverse
Effect.
9.2 Remedies. If any Event of Default occurs and is continuing,
the Agent shall, at the request of, or may, with the consent of, the Required
Banks,
(a) declare the obligation of each Bank to make Loans and
the obligation of the Swingline Bank to make Swingline Loans, and any
obligation of the Issuing Bank to Issue Letters of Credit to be terminated,
whereupon such obligations and such Bank's Commitments shall be terminated;
(b) declare an amount equal to the maximum aggregate
amount that is or at any time thereafter may become available for drawing under
any outstanding Letters of Credit (whether or not any beneficiary shall have
presented, or shall be entitled at such time to present, the drafts or other
documents required to draw under such Letters of Credit) to be immediately due
and payable, and 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 Borrower; 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 9.1 (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 and any obligation of the Issuing Bank to Issue
Letters of Credit 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, the
Issuing Bank or any Bank.
9.3 Certain Financial Covenant Defaults. In the event that, after
taking into account any extraordinary charge to earnings taken or to be taken
as of the end of any fiscal period of the Borrower (a "Charge"), and if solely
by virtue of such Charge, there would exist an Event of Default due to the
breach of any of Section 7.13 as of such fiscal period end date, such Event of
Default shall be deemed to arise upon the earlier of (a) the date after such
fiscal period end date on which the Borrower announces publicly it will take,
is taking or has taken such Charge (including an announcement in the form of a
statement in a report filed with the SEC) or, if such announcement is made
prior to such fiscal period end date, the date that is such fiscal period end
date, and (b) the date the Borrower delivers to the Agent its audited annual or
unaudited quarterly financial statements in respect of such fiscal period
reflecting such Charge as taken.
ARTICLE X
THE AGENT
10.1 Appointment and Authorization; "Agent". (a) Each Bank hereby
irrevocably (subject to Section 10.9) appoints, designates and authorizes the
Agent to take such action on its
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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.
Without limiting the generality of the foregoing sentence, the use of the term
"agent" in this Agreement with reference to the Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used merely as a
matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties.
(b) The Issuing Bank shall act on behalf of the Banks
with respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may agree at the
request of the Required Banks to act for such Issuing Bank with respect
thereto; provided, however, that the Issuing Bank shall have all of the
benefits and immunities (i) provided to the Agent in this Article X with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit Issued by it or proposed to be Issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Agent", as used in this Article X,
included the Issuing Bank with respect to such acts or omissions, and (ii) as
additionally provided in this Agreement with respect to the Issuing Bank.
10.2 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.
10.3 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 Borrower or
any Subsidiary or Affiliate of the Borrower, 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 Borrower
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 Borrower or any
of the Borrower's Subsidiaries or Affiliates.
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10.4 Reliance by Agent. (a) 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 Borrower), 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.
(b) For purposes of determining compliance with the
conditions specified in Section 5.1, each Bank that has executed this Agreement
shall be deemed to have consented to, approved or accepted or to be satisfied
with, each document or other matter either sent (or made available) by the
Agent to such Bank for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to such Bank, unless an officer of the Agent responsible for the
transactions contemplated by the Loan Documents shall have received notice from
such Bank prior to the Closing Date specifying its objection thereto and such
objection shall not have been withdrawn by notice to the Agent to that effect
on or prior to the Closing Date.
10.5 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 Borrower 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 IX; provided, however, that unless and until the Agent
has 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.
10.6 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 Borrower 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 Borrower and its Subsidiaries, the value of and title
to any collateral, and all applicable bank regulatory laws relating to the
transactions contemplated
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hereby, and made its own decision to enter into this Agreement and to extend
credit to the Borrower 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 Borrower. 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 Borrower
which may come into the possession of any of the Agent-Related Persons.
10.7 Indemnification of Agent. 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
Borrower and without limiting the obligation of the Borrower to do so), in
accordance with the Banks' Pro Rata Shares 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 to the extent that they are found by a final decision of a court of
competent jurisdiction to have resulted 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 Borrower. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the Agent.
10.8 Agent in Individual Capacity. BofA 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 Borrower and
its Subsidiaries and Affiliates as though BofA were not the Agent or the
Issuing Bank hereunder and without notice to or consent of the Banks. The
Banks acknowledge that, pursuant to such activities, BofA or its Affiliates may
receive information regarding the Borrower or its Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Borrower or such Subsidiary) and acknowledge that the Agent shall be under no
obligation to provide such information to them. With respect to its Loans,
BofA 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 or the Issuing
Bank.
10.9 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
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Agent, the Agent may appoint, after consulting with the Banks and the Borrower,
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 X and Sections 11.4 and 11.5 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. Notwithstanding the foregoing, however, BofA may
not be removed as the Agent at the request of the Required Banks unless BofA
shall also simultaneously be replaced as "Issuing Bank" and "Swingline Bank"
hereunder pursuant to documentation in form and substance reasonably
satisfactory to BofA (which documentation, among other things, will deal with
replacement and cancellation of all outstanding Letters of Credit and the
payment of all outstanding Swingline Loans in a manner satisfactory to BofA).
10.10 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 to deliver to the Agent and the Borrower:
(i) if such Bank claims an exemption from, or a
reduction of, withholding tax under a United States tax treaty, two
properly completed and executed copies of IRS Form 1001 before the
payment of any interest or fees in the first calendar year and before
the payment of any interest or fees in each third succeeding calendar
year during which interest or fees 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 4224
before the payment of any interest or fees is due in the first taxable
year of such Bank and in each succeeding taxable year of such Bank
during which interest or fees may be paid under this Agreement; and
(iii) 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 and the Borrower 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 1001 and
such Bank sells, assigns, grants a participation in, or otherwise transfers all
or part of the Obligations of the Borrower owing to
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such Bank, such Bank agrees to notify the Agent and the Borrower of the
percentage amount in which it is no longer the beneficial owner of Obligations
of the Borrower owing to such Bank. To the extent of such percentage amount,
the Agent and the Borrower will treat such Bank's IRS Form 1001 as no longer
valid.
(c) If any Bank claiming exemption from United States
withholding tax by filing IRS Form 4224 with the Agent and the Borrower sells,
assigns, grants a participation in, or otherwise transfers all or part of the
Obligations of the Borrower 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 entitled to a reduction in the
applicable withholding tax, the Borrower (or if not withheld by the Borrower
the Agent) may withhold from any interest payment to such Bank, or to the Agent
on behalf of such Bank, an amount equivalent to the applicable withholding tax
after taking into account such reduction. However, if the forms or other
documentation required by subsection (a) of this Section are not delivered to
the Agent and the Borrower, then the Borrower (or the Agent, if not withheld by
the Borrower) may withhold from any interest payment to such Bank, or to the
Agent on behalf of such Bank, not providing such forms or other documentation
an amount equivalent to the applicable withholding tax imposed by Sections 1441
and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the
United States or other jurisdiction asserts a claim that the Borrower or 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 or was not properly
executed, or because such Bank failed to notify the Borrower or 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 Borrower or the Agent fully for all amounts paid, directly or indirectly,
by the Borrower or the Agent as tax or otherwise, including penalties and
interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Borrower or 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.
ARTICLE XI
MISCELLANEOUS
11.1 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 Borrower or any applicable Subsidiary
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 Borrower 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
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signed by all the Banks and the Borrower and acknowledged by the Agent, do any
of the following:
(a) increase or extend the Commitment of any Bank or the
Swingline Commitment of the Swingline Bank;
(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 any of them) hereunder or under any other Loan
Document;
(c) reduce the principal of, or the rate of interest
specified herein on any Loan, or any fees or other amounts payable hereunder or
under any other Loan Document;
(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 2.14, 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 Issuing Bank in addition to the Required Banks or
all the Banks, as the case may be, affect the rights or duties of the Issuing
Bank under this Agreement or any L/C-Related Document relating to any Letter of
Credit Issued or to be Issued by it, and (ii) 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.
11.2 Notices. (a) All notices, requests, consents, approvals,
waivers and other communications shall be in writing (including, unless the
context expressly otherwise provides, by facsimile transmission, provided that
any matter transmitted by the Borrower by facsimile (i) shall be immediately
confirmed by a telephone call to the recipient at the number specified on
Schedule 11.2, 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 11.2; or, as directed to the Borrower
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 Borrower and the Agent. All notices to the Borrower shall be sent to
Storage Technology Corporation, 0000 Xxxxx 00xx Xxxxxx, Xxxxxxxxxx, XX
00000-0000, Attention: Treasurer, Telecopy No.: (000) 000-0000.
(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. mails, or if delivered, upon delivery; except that
notices pursuant to Article II, III or X to the Agent shall not be effective
until actually
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received by the Agent, and notices pursuant to Article III to the Issuing Bank
shall not be effective until actually received by the Issuing Bank at the
address specified for the "Issuing Bank" on the applicable signature page
hereof.
(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 Borrower. The Agent and the Banks shall be entitled
to rely on the authority of any Person purporting to be a Person authorized by
the Borrower to give such notice and the Agent and the Banks shall not have any
liability to the Borrower 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 obligation of the Borrower to repay the Loans and L/C Obligations
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.
11.3 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. 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.
11.4 Costs and Expenses. The Borrower shall:
(a) whether or not the transactions contemplated hereby
are consummated, pay or reimburse the Agent within five Business Days after
demand (subject to subsection 5.1(e)) for all costs and expenses incurred by
the Agent in connection with the development, preparation, delivery, ongoing
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 and search and filing fees and
expenses incurred by the Agent with respect thereto;
(b) pay or reimburse the Agent and the Arranger and each
Bank within five Business Days after demand (subject to subsection 5.1(e)) for
all costs and expenses (including reasonable Attorney Costs and search and
filing fees and expenses provided that the Borrower shall have been given
statements containing reasonably detailed bills for such fees and expenses)
incurred by them in connection with the 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); and
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(c) during the continuance of any Event of Default, pay
or reimburse the Agent within five Business Days after demand for all appraisal
(including the allocated cost of internal appraisal services), audit,
environmental inspection and review (including the allocated cost of such
internal services), incurred or sustained by the Agent in connection with the
matters referred to under subsections (a) and (b) of this Section.
11.5 Borrower's Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify, defend 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 Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans, the termination of the Letters of Credit and the
termination, resignation or replacement of the Agent or replacement of any
Bank) be imposed on, incurred by or asserted against any such 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 Person under or in connection with any of the
foregoing, 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 Letters of Credit
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 Borrower shall have no obligation hereunder to any
Indemnified Person with respect to Indemnified Liabilities to the extent they
are found by a final decision of a court of competent jurisdiction to have
resulted solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
11.6 Payments Set Aside. To the extent that the Borrower 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.
11.7 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the
prior written consent of the Agent and each Bank.
11.8 Assignments, Participations, Etc. (a) Any Bank may, with the
written consent of the Borrower at all times other than during the existence of
an Event of Default and the Agent and the Issuing Bank, (which consents in each
case shall not be unreasonably withheld), at any
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time assign and delegate to one or more Eligible Assignees (provided that no
written consent of the Borrower, the Agent or the Issuing Bank shall be
required in connection with any assignment and delegation by a Bank to an
Eligible Assignee that is an Affiliate of such Bank or that is a Bank then
holding a Commitment hereunder) (each an "Assignee") all, or any ratable part
of all, of the Loans, the Commitments, the L/C Obligations and the other rights
and obligations of such Bank hereunder, provided, that any such assigning Bank
either retains a Commitment or Loan of at least $15,000,000 or disposes of its
entire Commitment or Loans and provided further that any Assignee shall have a
Commitment or Loans of at least $15,000,000; provided, however, that the
Borrower and the Agent may continue to deal solely and directly with such Bank
in connection with the interest so assigned to an Assignee until (i) written
notice of such assignment, together with payment instructions, addresses and
related information with respect to the Assignee, shall have been given to the
Borrower and the Agent by such Bank and the Assignee; (ii) such Bank and its
Assignee shall have delivered to the Borrower and the Agent an Assignment and
Acceptance in the form of Exhibit E ("Assignment and Acceptance") together with
any Note or Notes subject to such assignment and (iii) the assignor Bank or
Assignee has paid to the Agent a processing fee in the amount of $4,000. No
Assignee shall be entitled to higher recoveries or greater rights under
Sections 4.1, 4.2 and 4.3 than its assignor.
(b) From and after the date that the Agent notifies the
assignor Bank that it has received (and provided its consent with respect to)
an executed Assignment and Acceptance and payment of the above-referenced
processing fee, (i) the Assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, shall have the rights and obligations of a
Bank under the Loan Documents, (ii) this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Commitments and
Loans arising therefrom, and (iii) the assignor Bank shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Loan Documents; provided,
however, that the assignor Bank shall not relinquish its rights under Article
IV or under Sections 11.4 and 11.5 to the extent such rights relate to the time
prior to the effective date of the Assignment and Acceptance. The Commitment
allocated to each Assignee shall reduce the Commitment of the assigning Bank
pro tanto.
(c) Within five Business Days after its receipt of notice
by the Agent that it has received an executed Assignment and Acceptance and
payment of the processing fee, (and provided that it consents to such
assignment in accordance with subsection 11.8(a)), the Borrower shall execute
and deliver to the Agent, any new Notes requested by such Assignee evidencing
such Assignee's assigned Loans and Commitment and, if the assignor Bank has
retained a portion of its Loans and its Commitment, replacement Notes as
requested by the assignor Bank evidencing the Loans and Commitment retained by
such assignor Bank (such Notes to be in exchange for, but not in payment of,
the Notes held by such Bank).
(d) Any Bank may at any time sell to one or more
commercial banks or other Persons not Affiliates of the Borrower (a
"Participant") participating interests in any Loans, the Commitment of that
Bank and the other interests of that Bank (the "originating Bank") hereunder
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and under the other Loan Documents; provided, however, that (i) the originating
Bank's obligations under this Agreement shall remain unchanged, (ii) the
originating Bank shall remain solely responsible for the performance of such
obligations, (iii) the Borrower, the Issuing Bank and the Agent shall continue
to deal solely and directly with the originating Bank in connection with the
originating Bank's rights and obligations under this Agreement and the other
Loan Documents, and (iv) no Bank shall transfer or grant any participating
interest under which the Participant has rights to approve any amendment to, or
any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment, consent or waiver would require
unanimous consent of the Banks as described in the first proviso to Section
11.1. In the case of any such participation, the Participant shall be entitled
to the benefit of Sections 4.1, 4.3 and 11.5 as though it were also a Bank
hereunder, and not otherwise have any rights under this Agreement, or any of
the other Loan Documents, and all amounts payable by the Borrower hereunder
shall be determined as if such Bank had not sold such participation; except
that, if amounts outstanding under this Agreement are due and unpaid, or shall
have been declared or shall have become due and payable upon the occurrence of
an Event of Default, each Participant shall be deemed to have the right of
set-off in respect of its participating interest in amounts owing under this
Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Bank under this Agreement.
(e) Notwithstanding any other provision in this
Agreement, any Bank may at any time create a security interest in, or pledge,
all or any portion of its rights under and interest in this Agreement and any
Note held by it in favor of any Federal Reserve Bank in accordance with
Regulation A of the FRB or U.S. Treasury Regulation 31 CFR Section 203.14, and
such Federal Reserve Bank may enforce such pledge or security interest in any
manner permitted under applicable law.
11.9 Confidentiality. Each Bank and the Agent agrees that it will
not disclose to any third party any written information marked "Confidential,"
"Secret," "Top Security," "Protected" or words of similar import, provided to
it by the Borrower or any Subsidiary or any oral information which is stated to
be confidential and which is confirmed as such in writing within seven days;
provided, however, that the foregoing will not (i) restrict the ability of the
Agent, the Banks and any loan participants from freely exchanging such
information among themselves (and their respective employees, attorneys,
auditors and other professional advisors), (ii) restrict the ability to
disclose such information to a prospective Eligible Assignee or participants,
provided, that such Eligible Assignee or participants execute a confidentiality
agreement with the selling Bank agreeing to be bound by the terms hereof prior
to disclosure of such information to such Eligible Assignee or participant, or
(iii) prohibit the disclosure of such information to the extent such
information (A) becomes publicly available other than through a breach of this
Section 11.9, (B) becomes available through a Person other than the Borrower or
a Subsidiary of the Borrower, (C) is required to be disclosed pursuant to court
order, subpoena, other legal process, regulatory request or otherwise by law or
(D) is disclosed in litigation with the Borrower or any Subsidiary of the
Borrower or in connection with the enforcement of remedies by the Agent or
Banks after acceleration of the Loans or after the Termination Date.
11.10 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
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time and from time to time, without prior notice to the Borrower, any such
notice being waived by the Borrower 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 Borrower 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 Borrower 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.
11.11 Automatic Debits of Fees. With respect to any commitment fee,
letter of credit fee or other fee, or any other cost or expense (including
Attorney Costs) due and payable to the Agent, the Issuing Bank, BofA or the
Arranger under the Loan Documents, the Borrower hereby irrevocably authorizes
BofA to debit any deposit account of the Borrower with BofA in an amount such
that the aggregate amount debited from all such deposit accounts does not
exceed such fee or other cost or expense. If there are insufficient funds in
such deposit accounts to cover the amount of the fee or other cost or expense
then due, such debits will be reversed (in whole or in part, in BofA's sole
discretion) and such amount not debited shall be deemed to be unpaid. No such
debit under this Section shall be deemed a set-off.
11.12 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.
11.13 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.
11.14 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.
11.15 No Third Parties Benefited. This Agreement is made and
entered into for the sole protection and legal benefit of the Borrower, 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.
11.16 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 CALIFORNIA; PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL
RIGHTS ARISING UNDER FEDERAL LAW.
73.
80
(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 CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA,
AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE BORROWER, 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 BORROWER, 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
BORROWER, 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
CALIFORNIA LAW.
11.17 Waiver of Jury Trial. THE BORROWER, 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 BORROWER, 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.
11.18 Entire Agreement. This Agreement, together with the other
Loan Documents, embodies the entire agreement and understanding among the
Borrower, 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.
[Intentionally left blank]
74.
81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in San Francisco by their proper and duly
authorized officers as of the day and year first above written.
STORAGE TECHNOLOGY CORPORATION
By: /s/ Xxxx X. XxXxxxxx
------------------------------------
Title: VP & Treasurer
---------------------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By: /s/ Xxxxx XxXxxxx
------------------------------------
Xxxxx XxXxxxx
Title: Managing Director
---------------------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as a Bank, as Issuing
Bank and as Swingline Bank
By: /s/ Xxxxx XxXxxxx
------------------------------------
Xxxxx XxXxxxx
Title: Managing Director
---------------------------------
S-1
82
SCHEDULE 2.1
COMMITMENTS
AND PRO RATA SHARES
Bank Commitment* Pro Rata Share
---- ---------- --------------
Bank of America National Trust and Savings $350,000,000 100.00%
Association
TOTAL $350,000,000 100.00%
*The Commitment amount of each Bank is subject to reduction pursuant to
reductions in the Total Commitment Amount. As the Total Commitment Amount is
reduced, each Bank's Commitment amount shall be automatically reduced in
accordance with its Pro Rata Share of the Total Commitment Amount.
83
Schedule 2.9(e)
APPLICABLE MARGIN AND COMMITMENT FEE PRICING GRID
------------------------------------------------------------------------------------------------------
Total Debt to Total Leverage Ratio L. 35% 35% < Total Leverage Ratio
EBITDA
(rolling 4
quarter)
(x)
----------------------------------------------------------------------------------
Offshore Base Base
Rate Rate Commitment Offshore Rate Commitment
Spread Spread Fee Rate Spread Spread Fee
(%) (%)
(%) (%) (%) (%)
------------------------------------------------------------------------------------------------------
X ( .50 .625 0.0 .200 .875 0.0 .250
------------------------------------------------------------------------------------------------------
.50 L. X ( 1.00 1.00 0.0 .275 1.25 0.0 .325
------------------------------------------------------------------------------------------------------
1.00 L. X ( 1.50 1.25 0.0 .325 1.50 0.0 .350
------------------------------------------------------------------------------------------------------
X 3rd power 1.50 1.50 0.0 .350 1.75 0.0 .375
------------------------------------------------------------------------------------------------------
Note:
The initial Applicable Margin commencing on the Closing Date and continuing
until the Agent receives the Compliance Certificate required by Section 7.2(a)
for the fiscal quarter ending December 1997 shall be the greater of:
(a) The Offshore Rate plus .75%; and
(b) The Applicable Margin determined by the above pricing grid.
84
SCHEDULE 5.2(a)
LETTERS OF CREDIT OUTSTANDING UNDER PRIOR LOAN DOCUMENTS
===========================================================================================================
Letter of Credit Date of Date of Current Amount Beneficiary
Number Issuance Expiry Outstanding
-----------------------------------------------------------------------------------------------------------
SBLC 227106 1/11/96 1/5/98 50,000.00 Mellon Bank
-----------------------------------------------------------------------------------------------------------
SBLC 225003 8/2/95 7/31/99 100,000.00 New England Power Company
-----------------------------------------------------------------------------------------------------------
SBLC 3001446 9/19/96 2/7/98 262,625.00 WCB Twenty Ltd. Partnership
-----------------------------------------------------------------------------------------------------------
SBLC 228710 5/1/96 9/28/98 35,200,000.00 Bank of America NT&SA
===========================================================================================================
85
EXHIBIT A
to the Credit Agreement
FORM OF NOTICE OF BORROWING
Date:
-------------
To: Bank of America National Trust and
Savings Association, as Agent
Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000-0000
Attn:Storage Technology A/O
Re: Storage Technology Corporation
Ladies and Gentlemen:
The undersigned, Storage Technology Corporation (the "Company"),
refers to the Credit Agreement dated as of October ___, 1997 (as amended,
modified, renewed or extended from time to time, the "Credit Agreement"), among
the Company, the financial institutions party to the Credit Agreement (the
"Banks") and Bank of America National Trust and Savings Association, as
Swingline Bank, Issuing Bank and Agent for the Banks, for full particulars of
the matters herein described. All capitalized terms used in this Notice of
Borrowing and not otherwise defined herein shall have the meanings assigned to
such terms in the Credit Agreement. The undersigned hereby gives you
irrevocable notice, pursuant to Section 2.3 of the Credit Agreement, of the
Borrowing specified herein and that:
1. The requested Borrowing Date for the proposed Borrowing is
_____________, ________.
2. The Borrowing is in respect of [Revolving Loans] [a Swingline
Loan].
3. The aggregate amount of the proposed Borrowing is
$____________.
4. The Borrowing is to be comprised of $________ of [Offshore
Rate] [Base Rate] Loans.
5. [If applicable:] The duration of the Interest Period for the
Offshore Rate Loans included in the Borrowing shall be [one] [two] [three]
[six] 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-1
86
(a) the representations and warranties of the Company
contained in Article VI of the Credit Agreement are true and correct
as though made on and as of each 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 earlier date, and except
that subsections 6.11(a) and 6.11(b) of the Credit Agreement shall be
deemed to refer instead to the last day of the most recent fiscal year
for which financial statements have then been delivered);
(b) no Default or Event of Default exists, or would
result from such proposed Borrowing; and
(c) the proposed Borrowing will not cause (i) the
Effective Amount of all Revolving Loans plus the Effective Amount of
all Swingline Loans plus the Effective Amount of all L/C Obligations
to exceed the Total Commitment Amount, and (ii) the Effective Amount
of all Swingline Loans to exceed the Swingline Commitment.
STORAGE TECHNOLOGY CORPORATION
By:
-------------------------------------
Name:
Title:
[Copy to Swingline Bank if Notice of Borrowing relates to Borrowing of a
Swingline Loan.]
A-2
87
EXHIBIT B
to the Credit Agreement
FORM OF NOTICE OF CONVERSION/CONTINUATION
Date:
--------------
To: Bank of America National Trust and
Savings Association, as Agent
Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000-0000
Attn:Storage Technology A/O
Re: Storage Technology Corporation
Ladies and Gentlemen:
The undersigned, Storage Technology Corporation (the "Company"),
refers to the Credit Agreement dated as of October ___, 1997 (as amended,
modified, renewed or extended from time to time, the "Credit Agreement"), among
the Company, the financial institutions party to the Credit Agreement (the
"Banks") and Bank of America National Trust and Savings Association, as
Swingline Bank, Issuing Bank and Agent for the Banks, for full particulars of
the matters herein described. All capitalized terms used in this Notice of
Conversion/Continuation and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The undersigned
hereby gives you irrevocable notice, pursuant to Section 2.4 of the Credit
Agreement, of the [conversion] [continuation] of the Loans specified herein and
that:
1. The date of the [conversion] [continuation] is
______________, _______.
2. The [conversion] [continuation] is in respect of
outstanding Revolving Loans.
3. The aggregate amount of the Loans to be [converted]
[continued] is $__________.
4. The Loans are to be [converted into] [continued as]
[Offshore Rate] [Base Rate] Loans.
5. [If applicable:] The duration of the Interest Period
for the Offshore Rate Loans to be [converted] [continued] shall be
[one] [two] [three] [six] months.
B-1
88
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the proposed
[conversion][continuation], before and after giving effect thereto:
(a) the representations and warranties of the Company
contained in Article VI of the Credit Agreement are true and correct
as though made on and as of each 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 earlier date, and except
that subsections 6.11(a) and 6.11(b) of the Credit Agreement shall be
deemed to refer instead to the last day of the most recent fiscal year
for which financial statements have then been delivered); and
(b) no Default or Event of Default exists, or would
result from such proposed [conversion] [continuation].
STORAGE TECHNOLOGY CORPORATION
By:
-------------------------------
Name:
Title:
B-2
89
EXHIBIT C
to the Credit Agreement
FORM OF COMPLIANCE CERTIFICATE
To: Bank of America National Trust and
Savings Association, as Agent
Credit Products High Technology #3697
000 Xxxxxxxxxx Xxxxxx, 00xx Xx.
Xxx Xxxxxxxxx, XX 00000-0000
Attn:Xxxxx XxXxxxx, Managing Director
Re: Storage Technology Corporation
Ladies and Gentlemen:
This Compliance Certificate is made and delivered pursuant to Section
7.2(a) of the Credit Agreement, dated as of October ___, 1997 (as amended,
modified, renewed or extended from time to time, the "Credit Agreement"), among
Storage Technology Corporation (the "Company"), the financial institutions
party to the Credit Agreement (the "Banks") and Bank of America National Trust
and Savings Association, as Swingline Bank, Issuing Bank and Agent for the
Banks, and reference is made thereto for full particulars of the matters
described herein. All capitalized terms used in this Compliance Certificate
and not otherwise defined herein shall have the meanings assigned to such terms
in the Credit Agreement. This Compliance Certificate relates to the fiscal
quarter ending __________, _____.
Pursuant to Section 7.1(a) and 7.1(b) the Company hereby certifies
that the information set forth on Schedule 1 hereto (and on any additional
schedules hereto setting forth further supporting detail) is true, accurate and
complete as of the end of such accounting period and further certifies that the
financial statements for the fiscal quarter ended __________, _____ fairly
present, in accordance with GAAP (subject to ordinary, good-faith year-end
audit adjustments), the financial position and the results of operations of the
Borrower and its Subsidiaries.
The Company further certifies that (i) as of the date hereof no
Default or Event of Default exists, and (ii) on and as of the date hereof,
there has occurred no Material Adverse Effect since the date of the end of the
last fiscal quarter, except in each case as may be set forth in a separate
attachment hereto describing in detail the nature of each condition or event
constituting an exception to the foregoing statements, the period during which
it has existed and the action which the Company is taking or proposes to take
with respect to each such condition or event.
C-1
90
IN WITNESS WHEREOF, the undersigned has signed this Compliance
Certificate this ____ day of ______________, _____.
STORAGE TECHNOLOGY CORPORATION
By:
-------------------------------
Name:
Title:
C-2
91
SCHEDULE 1
to the Compliance Certificate
Dated ________, ____
For the fiscal quarter ended __________, _____
Actual Required/Permitted
------ ------------------
1. Section 7.13(a) - Minimum Consolidated A not less than B
--------------------------------------
Tangible Net Worth
------------------
(A) Consolidated Tangible Net
Worth, calculated as at
end of each fiscal quarter
Consolidated Total Assets $
-------------
minus intangible assets and other
excluded assets --------------
minus amortizing debt issuance --------------
expenses carried as an
asset
minus reserves carried and not --------------
deducted from assets or
not reflected as a
liability
minus cash held in sinking or
other analogous fund
minus Consolidated Total Liabilities --------------
Consolidated Tangible Net Worth $
as at the end of the fiscal quarter -------------
1.
92
Actual Required/Permitted
------ ------------------
(B) Minimum Consolidated
Tangible Net Worth
calculation
Beginning minimum amount The greater of
(i) 95% of
Consolidated
Tangible Net
Worth as at
9/26/97 and
(ii)
$1,279,000,000
plus75% of Consolidated Net --------------
Income (excluding
Consolidated Net Losses)
of the Borrower and its
Subsidiaries earned in
each fiscal quarter after
September 26, 1997
plus75% of the amount of all --------------
proceeds (net of costs
and expenses) received
pursuant to the issuance
of any equity securities
issued by the Borrower
after September 26, 1997
(excluding proceeds of
any issuance made for the
purposes of fulfilling an
employee stock purchase
plan or compensatory
option plan.)
plus100% of the face amount of --------------
any Subordinated
Indebtedness that is
converted into stock of
the Borrower after
September 26, 1997
minus 100% of the amount paid by --------------
the Borrower in respect
of repurchases of its
stock (up to
$800,000,000)
2.
93
Actual Required/Permitted
------ ------------------
minus 100% of the amount of costs --------------
and expenses in respect
of mergers and
acquisitions consummated
in such fiscal quarter
recognized in accordance
with GAAP (up to
$100,000,000 in aggregate
during the initial term
of the Agreement)
Minimum Consolidated Tangible Net $
------------
Worth required
Difference between A and B $
------------
3.
94
Actual Required/Permitted
------ ------------------
2. Section 7.13(b) - Consolidated Net Income No (i) Consolidated Net
----------------------------------------- Loss or Consolidated
Operating Loss of the
Borrower and its
Subsidiaries to occur for
each of any two
consecutive fiscal
quarters (calculated as of
the last day of each such
fiscal quarter); or (ii)
Consolidated Net Loss or
Consolidated Operating
Loss of the Borrower and
its Subsidiaries for any
fiscal quarter greater
then $25,000,000.
(A) Consolidated Net Loss $
-------------
(B) Consolidated Operating $
-------------
Loss
Note: Provided that there shall be excluded from Consolidated Net Loss and
Consolidated Operating Loss for any fiscal quarter the amount of costs and
expenses in respect of mergers and acquisitions consummated in such quarter and
recognized in accordance with GAAP (up to $100,000,000 in aggregate during the
initial term of the Agreement).
4.
95
Actual Required/Permitted
------ ------------------
3. Section 7.13(c) - Consolidated Total Fore the period Closing
------------------------------------ Date through April 2,
Leverage Ratio 1999, not greater than
-------------- 0.400 to 1.00 (as at the
end of the fiscal
quarter).
For the period of April 3,
1999 and thereafter, not
greater than 0.350 to 1.00
(as at the end of the
fiscal quarter).
(A) Consolidated Debt $
-------------
(B) Consolidated Total $
-------------
Capital
Ratio of (A) to (B)
--------------
5.
96
Actual Required/Permitted
------ ------------------
4. Section 7.13(d) - Adjusted Quick Ratio For the period Closing Date
-------------------------------------- through January 1, 1999,
not less than 0.95 to 1.00
(as at the end of the
fiscal quarter).
For the period January 2,
1999 through October 1,
1999, not less than 1.00 to
1.00 (as at the end of the
fiscal quarter).
For the period October 2,
1999 and thereafter, not
less than 1.25 to 1.00 (as
at the end of the fiscal
quarter).
(A) Current Liquid Assets $
--------
(B) Current Liabilities $
--------
Ratio of (A) to (B)
---------
5. EBITDA
------
Consolidated Net Income (or Net Loss) $
--------
calculated on a rolling four quarter basis
plusamounts treated as expenses $
---- -------------
for depreciation,
interest and the
amortization of
intangibles of any kind
to the extent included in
the determination of Net
Income or Net Loss,
calculated on a rolling
four quarter basis
plusaccrued taxes on or measured $
---- -------------
by income to the extent
included in the
determination of Net
Income or Net Loss,
calculated on a rolling
four quarter basis
EBITDA, calculated on a rolling four $
quarter basis ------------
6.
97
EXHIBIT D-1
FORM OF OPINION OF SHEARMAN & STERLING
October ___, 1997
To each of the financial institutions
party to the Credit Agreement referred to
below and to Bank of America National Trust and
Savings Association, as Agent
Ladies and Gentlemen:
We have acted as special counsel for Storage Technology Corporation, a
Delaware corporation ("the Company"), in connection with the negotiation,
execution and delivery of the Credit Agreement dated as of October ___, 1997
(the "Credit Agreement") among the Company, the several financial institutions
which are signatories thereto (collectively, the "Banks"), and Bank of America
National Trust and Savings Association, as lender of the Swingline Loans (in
such capacity, the "Swingline Bank"), as issuer of the Letters of Credit (in
such capacity, the "Issuing Bank"), and as agent (the "Agent") for the Banks,
the Swingline Bank and the Issuing Bank.
This opinion is delivered to you pursuant to Section 5.1(d) of the
Credit Agreement. Capitalized terms not otherwise defined herein are used
herein with the meanings ascribed to such terms in the Credit Agreement.
In connection with this opinion, we have examined counterparts of the
Credit Agreement, together with all schedules and exhibits thereto, executed by
each of the parties thereto and such other documents, instruments and
certificates as we have deemed necessary for the purposes of rendering this
opinion, including the opinion of Xxxxxxx X. Xxxxxxxx, Esq. (the "Stenmark
Opinion"), corporate counsel to the Company.
With respect to certain factual matters relevant to this opinion, we
have relied solely upon, and assumed the accuracy of, representations made by
the Company in the Credit Agreement including, without limitation, that any
shares of the stock of the Company purchased with any proceeds of Loans under
the Credit Agreement will be retired immediately after any such purchase. We
have made no independent investigation of any of the facts stated in any of the
representations; however, nothing has come to our attention which would lead us
to believe that such facts are inaccurate. We do, however, call your attention
to the fact that we have acted as special counsel to the Company with regard to
the Credit Agreement and are not generally familiar with the operations of the
Company or its business or legal affairs.
1.
98
We have assumed (i) the genuineness of all signatures of Persons
(except for the Company) executing the Credit Agreement, (ii) the authenticity
of all documents submitted to us as originals, (iii) the conformity to
authentic original documents of all documents submitted to us as certified,
conformed or photostatic copies, and (iv) the due authorization, execution and
delivery of the Credit Agreement by the parties thereto.
We have also assumed, for the purposes of California usury law, that
the Swingline Bank, the Issuing Bank and each Bank is either (i) a national
bank operating pursuant to federal banking law or (ii) a "foreign (other state)
bank" within the meaning of Section 1200 of the California Financial Code.
We are qualified to practice law in the State of California, and our
opinion is restricted to the laws of the State of California and the federal
laws of the United States of America (collectively, the "Laws").
To the extent that our opinions expressed below involve conclusions as
to the matters set forth in paragraphs 1, 3, 4, 5, 9 or 10 of the Stenmark
Opinion, we have assumed without independent investigation the correctness of
such matters set forth in the Stenmark Opinion, our opinions being subject to
the assumptions, qualifications and limitations set forth in such opinions with
respect thereto.
Based upon the foregoing, and subject to the further assumptions,
exemptions, qualifications and limitations set forth herein, we advise you that
in our opinion:
1. The execution, delivery and performance by the Company of the
Credit Agreement does not contravene any applicable Laws, or any rule or
regulation promulgated thereunder (including, without limitation, Regulations
T, U, G and X of the Board of Governors of the Federal Reserve System).
2. No consent, authorization, approval or other action by, and no
notice to or registration or filing with, any Governmental Authority created or
acting under any of the Laws is required for the due execution, delivery or
performance by the Company of the Credit Agreement.
3. The Credit Agreement constitutes the legal, valid and binding
obligation of the Company, enforceable against it in accordance with its terms.
4. No taxes or governmental fees and charges are payable in
connection with the execution and delivery of the Credit Agreement.
Our opinions set forth above are subject to the following assumptions,
exceptions, qualifications and limitations:
A. Our opinion in paragraph 3 above is subject to the effect of
any applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally.
2.
99
B. Our opinion in paragraph 3 above is subject to the effect of
general principles of equity (regardless of whether considered in a proceeding
in equity or at law). Such principles of equity are of general application,
and in applying such principles a court, among other things, might not allow a
creditor to accelerate the maturity of a debt upon the occurrence of a default
deemed immaterial or might decline to order a borrower to perform covenants.
Such principles applied by a court might include a requirement that the
creditors act with reasonableness and in good faith. Such a requirement might
be applied, among other situations, to the provisions of the Credit Agreement
purporting to authorize conclusive determinations by any Bank, the Swingline
Bank, the Issuing Bank or the Agent.
C. Certain rights, remedies and waivers contained in the Credit
Agreement may be rendered ineffective or unenforceable or otherwise limited by
applicable laws or judicial decisions, but such laws and judicial decisions do
not, in our opinion, make the Credit Agreement inadequate for the practical
realization of the benefits intended to be provided thereby.
D. To the extent the Credit Agreement provides for the payment of
attorneys' fees in litigation, under California law such attorneys' fees must
be reasonable (as determined pursuant to Section 1717 of the California Civil
Code) and may be granted only to the prevailing party, and such provisions are
deemed to extend to both parties, notwithstanding that such provisions by their
express terms benefit only one party.
E. Enforcement of any indemnity provision contained in the Credit
Agreement, and the effect of any exculpatory provisions contained in the Credit
Agreement, may be limited to the extent such provisions encompass
indemnification or exculpation with respect to the negligence or misconduct of
any Bank, the Swingline Bank, the Issuing Bank or the Agent or to violations of
law or are found contrary to statute or public policy.
F. Requirements in the Credit Agreement specifying that
provisions thereof may only be waived or amended in writing may not be binding
or enforceable to the extent that a non-executory oral agreement has been
created modifying or waiving any provision of the Credit Agreement or an
implied agreement, by trade practice or course of conduct, allowing a waiver
has been created.
G. We have assumed that (i) each of the Banks has the power,
authority and legal right to enter into the Credit Agreement; (ii) the Credit
Agreement is a valid, binding and enforceable obligation of each of the Banks;
and (iii) there are no agreements, understandings or negotiations, whether
written or oral, between any of the Banks and the Company that would expand,
modify or otherwise affect the terms of the Credit Agreement, or the respective
rights or obligations or the parties thereunder. We note that we have been
advised by the Company that no such agreements, understandings or negotiations
exist.
H. We have assumed that if any Bank is required by California law
to be qualified as a foreign corporation in California as a result of
transactions other than the Credit Agreement, it has filed all required
franchise tax returns, if any, and paid all required taxes, if any, under the
California Revenue & Taxation Code.
3.
100
I. We express no opinion as to the extent to which rights with
respect to self help or exercise of other remedies without notice or judicial
proceedings can be validly exercised in California.
J. With respect to the enforceability of the Credit Agreement, we
have assumed that the Banks will: (i) exercise the rights and remedies set
forth in the Credit Agreement in a commercially reasonable manner; (ii) abide
by the implied covenant of good faith and fair dealing imposed by California
Law; and (iii) not take any discretionary action which is arbitrary,
unreasonable or capricious.
K. We express no opinion with respect to the legality, validity,
binding nature or enforceability (whether according to its terms or otherwise)
of any provision of the Credit Agreement regarding : (i) any waivers or
variations of rights of a debtor; and (ii) any severability provision in the
Credit Agreement as it relates to a provision or provisions, taken as a whole,
in the Credit Agreement, the existence and enforceability of which was material
to a party's decision to enter into the Credit Agreement.
L. We express no opinion herein as to the enforceability of
provisions for a rate of interest, after failure to pay any amount when due, in
excess of the rate of interest otherwise payable or provisions for late
charges, set forth in the Credit Agreement.
This opinion is rendered as of the date hereof. We express no opinion
as to circumstances or events which may occur subsequent to such date, and we
assume no obligation to revise or supplement this opinion in the event of any
future change in the Laws, or the rules and regulations promulgated thereunder,
or the interpretations thereof or any change in the facts upon which this
opinion is based.
This opinion is furnished for the benefit of the Banks, the Swingline
Bank (including any successor of the Swingline Bank), the Issuing Bank and the
Agent and their respective, successors and assignees (as permitted pursuant to
Section 11.8 of the Credit Agreement) and may not be relied upon by any other
Person for any purpose without our prior written consent. We consent to
Xxxxxxx Xxxxxxxx'x reliance on paragraph 1 of this opinion for the purpose of
her rendering her opinion pursuant to Section 5.1(d) of the Credit Agreement
Very truly yours,
4.
101
EXHIBIT D-1
FORM OF OPINION OF XXXXXXX X. XXXXXXXX, ESQ.
October ___, 1997
To each of the financial institutions
party to the Credit Agreement referred to
below and to Bank of America National Trust and
Savings Association, as Agent
Ladies and Gentlemen:
I am Senior Counsel to Storage Technology Corporation, a Delaware
corporation ("the Company"), and in such capacity have represented the Company
in connection with the preparation, negotiation, execution and delivery of the
Credit Agreement, dated as of October ___, 1997 (the "Credit Agreement"), among
the Company, the several financial institutions from time to time party to the
Credit Agreement (the "Banks"), and Bank of America National Trust and Savings
Association ("BofA"), as lender of the Swingline Loans (BofA, in its capacity
as such lender, the "Swingline Bank"), as issuer of the Letters of Credit
(BofA, in its capacity as such issuer, the "Issuing Bank"), and as agent (the
"Agent") for the Banks, the Swingline Bank and the Issuing Bank.
This opinion is delivered to you pursuant to Section 5.1(d) of the
Credit Agreement. Capitalized terms not otherwise defined herein are used
herein with the meanings ascribed to such terms in the Credit Agreement.
In connection with this opinion, I have examined the following
documents:
(a) counterparts of the Credit Agreement, together with all
schedules and exhibits thereto, executed by each of the parties thereto;
(b) certificates of public officials from the States of Delaware
and Colorado and such other states as I have deemed necessary for the purpose
of rendering this opinion;
(c) the certificate and by-laws of the Company, as amended to
date;
(d) records of proceedings of the Board of Directors of the
Company during or by which resolutions were adopted relating to matters covered
by this opinion; and
1.
102
(e) such other documents, instruments and certificates as I have
deemed necessary for the purpose of rendering this opinion.
I am qualified to practice law in the State of Colorado, and my
opinion is restricted to the laws of the State of Colorado, the general
corporation laws of the State of Delaware and the federal laws of the United
States of America.
Based upon the foregoing, and subject to the assumptions and
qualifications set forth herein, I am of the opinion that:
1. The Company is duly qualified as a foreign corporation to do
business and is in good standing in the State of Colorado and all other
jurisdictions in which the character of the properties owned or held under
lease by it or the nature of business transacted by it makes such qualification
necessary, except, in each case, where the failure to qualify as a foreign
corporation and be in good standing in jurisdictions other than Colorado would
not have a material adverse effect on the Company. The Company has been duly
incorporated and is validly existing and in good standing as a corporation
under the laws of the State of Delaware.
2. The Company has full corporate power and authority and all
authorizations, consents, approvals and governmental licenses required or
advisable to own and operate (or lease, as the case may be) its properties and
to carry on its business as currently conducted and contemplated to be
conducted.
3. The Company has full corporate power and authority and all
authorizations, consents, approvals and governmental licenses required or
advisable to execute, deliver and perform the Credit Agreement.
4. The execution, delivery and performance by the Company of the
Credit Agreement (i) are within the Company's corporate powers, (ii) have been
duly authorized by all necessary corporate action, (iii) do not contravene its
charter or by-laws or any other agreement, lease or instrument to which it is a
party or by which it or its properties may be bound or affected, (iv) will not
result in or require the creation or imposition of any Lien upon or with
respect to any property, assets or revenues now owned or hereafter acquired by
the Company, (v) will not violate, conflict with, contravene, or constitute a
default under any Contractual Obligation nor contravene any applicable law,
rule, regulation, order, writ, decree, determination or award presently in
effect which affects or binds it or any of its properties, which default,
contravention, violation or conflict could have a Material Adverse Effect or
render the Loan Documents unenforceable. No consent, authorization, approval
or other action by, and no notice to or registration with, any Governmental
Authority created or acting under any law, rule or regulation is required for
the due execution, delivery or performance by any Company of the Credit
Agreement.
5. The Credit Agreement has been duly executed and delivered on
behalf of each Company.
2.
103
6. The Credit Agreement constitutes the legal, valid and binding
obligation of such Company enforceable against such Company in accordance with
its terms.
For purposes of the foregoing opinion, (i) I have relied upon the
opinion expressed in paragraph 1 of the opinion letter of Shearman & Sterling
(the "Shearman & Sterling Opinion"), special counsel to the Company, (ii) I
have assumed without independent investigation the correctness of such matters
set forth in such opinion expressed in paragraph 1 of the Shearman & Sterling
Opinion, although I am unaware of any fact or circumstance which, if brought to
the attention of Shearman & Sterling, would likely result in a further
assumption, qualification or limitation with respect to such opinion, and (iii)
my opinion is subject to the assumptions, qualifications and limitations set
forth in the Shearman & Sterling Opinion with respect to the opinion expressed
in paragraph 1 therein.
7. There is no action, suit or proceeding pending or threatened,
in or before any Governmental Authority, domestic or foreign, which relates to
any aspect of the transactions contemplated by the Credit Agreement, and,
except as set forth in Schedule 6.5 to the Credit Agreement, there is no
material action, suit or proceeding pending or threatened, in or before any
Governmental Authority, domestic or foreign, which relates to any Company of
any of its Subsidiaries or any of the properties of any Company of any of its
Subsidiaries.
8. The Company does not have any issued and outstanding
indentures, convertible debentures, convertible exchangeable preferred stock or
other preferred stock, common stock or stock warrants that by its terms has or
will have any right of payment of principal or interest, including any sinking
fund payment, or redemption, or other right of payment, that is not
subordinated in right of payment to the satisfaction in full of all of the
Obligations.
9. Neither the Company, nor any Subsidiary of the Company, is, or
is required to be, registered under the Investment Company Act of 1940, as
amended.
10. To my knowledge, the Company is not engaged principally in the
business of extending credit for the purposes of purchasing or carrying margin
stock (within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System).
11. No taxes or governmental fees and charges are payable in
connection with the execution and delivery of the Credit Agreement.
The opinions set forth above are subject to the following
qualifications:
A. The opinion expressed in paragraph 6 above is subject to the
effect of any applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally, including, without
limitation, the effect of statutory or other laws regarding fraudulent
conveyances or preferential transfers.
B. The opinion expressed in paragraph 6 above is subject to the
effect of general principles of equity (regardless of whether considered in a
proceeding in equity or at law). Such principles of equity are of general
application, and in applying such principles a
3.
104
court, among other things, might not allow a creditor to accelerate the
maturity of a debt upon the occurrence of a default deemed immaterial or might
decline to order a borrower to perform covenants. Such principles applied by a
court might include a requirement that the creditors act with reasonableness
and in good faith. Such a requirement might be applied, among other
situations, to the provisions of the Credit Agreement purporting to authorize
conclusive determinations by any Bank, the Swingline Bank, the Issuing Bank or
the Agent.
C. Enforcement of any indemnity provision contained in the Credit
Agreement, and the effect of any exculpatory provisions contained in the Credit
Agreement, may be limited to the extent such provisions encompass
indemnification or exculpation with respect to the negligence or misconduct of
any Bank, the Swingline Bank, the Issuing Bank or the Agent or to violations of
law or are found contrary to statute or public policy.
This opinion is furnished for the benefit of the Banks, the Swingline
Bank, the Issuing Bank and the Agent and their respective successors and
assignees and may not be relied upon by any other Person for any purpose
without my prior written consent. I consent to Shearman & Sterling's reliance
on this opinion for the purpose of their rendering their opinions pursuant to
Section 5.1(d) of the Credit Agreement.
Very truly yours,
Xxxxxxx X. Xxxxxxxx
Senior Counsel
4.
105
EXHIBIT E
FORM OF ASSIGNMENT AND ACCEPTANCE
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of _____________ is made between __________________ (the
"Assignor") and ________________ (the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Credit Agreement dated
as of October ___, 1997 (as amended, restated, modified, supplemented or
renewed from time to time, the "Credit Agreement"), among Storage Technology
Corporation (the "Company"), the financial institutions from time to time party
thereto (including the Assignor, the "Banks") and Bank of America National
Trust and Savings Association, as Swingline Bank, Issuing Bank and agent for
the Banks (in its capacity as agent, the "Agent"). Any terms defined in the
Credit Agreement and not defined in this Assignment and Acceptance are used
herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to making Revolving Loans to the Company and to participate in
Letters of Credit issued for the account of the Company in an aggregate amount
not to exceed $__________ (the "Commitment");
WHEREAS, [the Assignor has made Loans in the aggregate principal
amount of $____________ to the Company] [no Loans are outstanding under the
Credit Agreement] [and the amount of Assignor's percentage share of the
aggregate amount available for drawing under outstanding Letters of Credit
issued for the account of the Company is $___________________] [and no Letters
of Credit are outstanding under the Credit Agreement]; and
WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all] rights and obligations of the Assignor under the Credit Agreement in
respect of its Commitment pro rata in accordance with the Assignor's Commitment
and L/C Commitment (which is a part of its Commitment rather than a separate,
independent commitment), [together with a corresponding portion of each of its
outstanding Loans] [and a corresponding portion of its participation in each of
the outstanding Letters of Credit], in an amount equal to ___% of the
Assignor's Commitment [and Loans], on the terms and subject to the conditions
set forth herein, and the Assignee wishes to accept assignment of such rights
and to assume such obligations from the Assignor on such terms and subject to
such conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
E-1.
106
1. Assignment and Acceptance.
(a) Subject to the terms and conditions of this
Assignment and Acceptance, (i) the Assignor hereby sells, transfers and assigns
to the Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes
from the Assignor, without recourse and without representation or warranty
(except as provided in this Assignment and Acceptance) ___% (the "Assignee's
Percentage Share") of (A) the Commitment and L/C Commitment [and the Loans] of
the Assignor [and participation in outstanding Letters of Credit] and (B) all
related rights, benefits, obligations, liabilities and indemnities of the
Assignor thereto under and in connection with the Credit Agreement and the Loan
Documents.
(b) With effect on and after the Effective Date (as
defined in Section 5 hereof), the Assignee shall be a party to the Credit
Agreement and succeed to all of the rights and be obligated to perform all of
the obligations of a Bank under the Credit Agreement, including the
requirements concerning confidentiality and the payment of indemnification,
with a Commitment in the amount set forth in subsection (c) below. The
Assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Bank. It is the intent of the parties hereto that the
Commitment of the Assignor shall, as of the Effective Date, be reduced by an
amount equal to the portion thereof assigned to the Assignee hereunder, and the
Assignor shall relinquish its rights and be released from its obligations under
the Credit Agreement to the extent such obligations have been assumed by the
Assignee including with respect to its L/C Commitment; provided, however, that
the Assignor shall not relinquish its rights under Article IV or Sections 11.4
and 11.5 of the Credit Agreement to the extent such rights relate to the time
prior to the Effective Date.
(c) After giving effect to the assignment and assumption
set forth herein, on the Effective Date: (i) the Assignee's Commitment will be
$__________[; (ii) the Assignee's aggregate outstanding Loans will be
$_______________;] [and (iii) the Assignee's L/C Commitment will be
$______________].
(d) After giving effect to the assignment and assumption
set forth herein, on the Effective Date: (i) the Assignor's Commitment will be
$__________[; (ii) the Assignor's aggregate outstanding Loans will be
$_______________;] [and (iii) the Assignor's L/C Commitment will be
$___________________].
2. Payments.
(a) As consideration for the sale, assignment and
transfer contemplated in Section 1 hereof, (i) the Assignee shall pay to the
Assignor on the Effective Date in immediately available funds an amount equal
to $__________, representing the Assignee's Percentage Share of the principal
amount of all Loans previously made by the Assignor to the Company under the
Credit Agreement and outstanding on the Effective Date and (ii) the Assignee
assumes the Assignee's Percentage Share of the Assignor's participation in the
Letters of Credit and each drawing under such Letter of Credit outstanding on
the Effective Date.
E-2.
107
(b) The [Assignor] [Assignee] further agrees to pay to
the Agent a processing fee in the amount specified in Section 11.8 of the
Credit Agreement.
3. Reallocation of Payments. Any interest, fees and other
payments accrued to the Effective Date with respect to the Commitment [and
Loans] [and Letters of Credit] of the Assignor shall be for the account of the
Assignor. Any interest, fees and other payments accrued on and after the
Effective Date with respect to the portion of such Commitment [and Loans] [and
Letters of Credit] assigned to the Assignee shall be for the account of the
Assignee. Each of the Assignor and the Assignee agrees that it will hold in
trust for the other party any interest, fees and other amounts which it may
receive to which the other party is entitled pursuant to the preceding sentence
and pay to the other party any such amounts which it may receive promptly upon
receipt.
4. Independent Credit Decision. The Assignee: (a) acknowledges
that it has received a copy of the Credit Agreement and the Schedules and
Exhibits thereto, together with copies of the most recent financial statements
referred to in Section 6.11 or Section 7.1 of the Credit Agreement, and such
other documents and information as it has deemed appropriate to make its own
credit and legal analysis and decision to enter into this Assignment and
Acceptance; and (b) agrees that it will, independently and without reliance
upon the Assignor, the Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit and legal decisions in taking or not taking action under the Credit
Agreement.
5. Effective Date; Notices.
(a) As between the Assignor and the Assignee, the
effective date for this Assignment and Acceptance shall be ______________ (the
"Effective Date"); provided that the following conditions precedent have been
satisfied on or before the Effective Date:
(i) this Assignment and Acceptance shall be
executed and delivered by the Assignor and the Assignee;
(ii) any consent of the Company and the Agent
required under Section 11.8 of the Credit Agreement for the
effectiveness of the assignment hereunder by the Assignor to the
Assignee shall have been duly obtained and shall be in full force and
effect as of the Effective Date;
(iii) the Assignee shall pay to the Assignor all
amounts due to the Assignor under this Assignment and Acceptance;
(iv) the processing fee referred to in Section
2(b) hereof and in Section 11.8 of the Credit Agreement shall have
been paid to the Agent; and
(v) the Assignor and Assignee shall have complied
with the other requirements of Section 11.8 of the Credit Agreement
and with the requirements of Sections 10.10 and 11.9 of the Credit
Agreement (in each case to the extent applicable).
E-3.
108
(b) Promptly following the execution of this Assignment
and Acceptance, the Assignor shall deliver to the Company and the Agent for
acknowledgement by the Agent, a Notice of Assignment substantially in the form
attached hereto as Schedule 1.
6. Agent. The Assignee hereby appoints and authorizes the
Assignor to take such action as agent on its behalf and to exercise such powers
under the Credit Agreement as are delegated to the Agent by the Banks pursuant
to the terms of the Credit Agreement. [The Assignee shall assume no duties or
obligations held by the Assignor in its capacity as Agent under the Credit
Agreement.] [INCLUDE ONLY IF ASSIGNOR IS AGENT]
7. Withholding Tax. The Assignee (a) represents and warrants to
the Assignor, the Agent and the Company that under applicable law and treaties
no tax will be required to be withheld by the Bank with respect to any payments
to be made to the Assignee hereunder, and (b) agrees to furnish (if it is
organized under the laws of any jurisdiction other than the United States or
any State thereof) to the Agent and the Company prior to the time that the
Agent or Company is required to make any payment of interest or fees under the
Credit Agreement, duplicate executed originals of either U.S. Internal Revenue
Service Form 4224 or U.S. Internal Revenue Service Form 1001 (wherein the
Assignee claims entitlement to the benefits of a tax treaty that provides for a
complete exemption from U.S. federal income withholding tax on all payments
hereunder) and agrees to provide new Forms 4224 or 1001 upon the expiration of
any previously delivered form or comparable statements in accordance with
applicable U.S. law and regulations and amendments thereto, duly executed and
completed by the Assignee, as and when required under the Credit Agreement.
8. Representations and Warranties.
(a) The Assignor represents and warrants that (i) it is
the legal and beneficial owner of the interest being assigned by it hereunder
and that such interest is free and clear of any Lien or other adverse claim;
(ii) it is duly organized and existing and it has the full power and authority
to take, and has taken, all action necessary to execute and deliver this
Assignment and Acceptance and any other documents required or permitted to be
executed or delivered by it in connection with this Assignment and Acceptance
and to fulfill its obligations hereunder; (iii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than those
referred to in Section 5(a)(ii) hereof and any already given or obtained) for
its due execution, delivery and performance of this Assignment and Acceptance,
and apart from any agreements or undertakings or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person is
required of it for such execution, delivery or performance; and (iv) this
Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor,
enforceable against the Assignor in accordance with the terms hereof, subject,
as to enforcement, to bankruptcy, insolvency, moratorium, reorganization and
other laws of general application relating to or affecting creditors' rights
and to general equitable principles.
(b) The Assignor makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement, any Loan
Document or the execution, legality, validity,
E-4.
109
enforceability, genuineness, sufficiency or value of the Credit Agreement, any
Loan Document or any other instrument or document furnished pursuant thereto.
The Assignor makes no representation or warranty in connection with, and
assumes no responsibility with respect to, the solvency, financial condition or
statements of the Company, or the performance or observance by the Company, of
any of its respective obligations under the Credit Agreement or any other
instrument or document furnished in connection therewith.
(c) The Assignee represents and warrants that (i) it is
duly organized and existing and it has full power and authority to take, and
has taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance, and to
fulfill its obligations hereunder; (ii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than those
referred to in Section 5(a)(ii) hereof and any already given or obtained) for
its due execution, delivery and performance of this Assignment and Acceptance;
and apart from any agreements or undertakings or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person is
required of it for such execution, delivery or performance; (iii) this
Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignee,
enforceable against the Assignee in accordance with the terms hereof, subject,
as to enforcement, to bankruptcy, insolvency, moratorium, reorganization and
other laws of general application relating to or affecting creditors' rights
and to general equitable principles; and (iv) it is an Eligible Assignee.
9. Further Assurances. The Assignor and the Assignee each hereby
agrees to execute and deliver such other instruments, and take such other
action, as either party may reasonably request in connection with the
transactions contemplated by this Assignment and Acceptance, including the
delivery of any notices or other documents or instruments to the Company or the
Agent, which may be required in connection with the assignment and assumption
contemplated hereby.
10. Miscellaneous.
(a) Any amendment or waiver of any provision of this
Assignment and Acceptance shall be in writing and signed by the parties hereto.
No failure or delay by either party hereto in exercising any right, power or
privilege hereunder shall operate as a waiver thereof and any waiver of any
breach of the provisions of this Assignment and Acceptance shall be without
prejudice to any rights with respect to any other or further breach thereof.
(b) All payments made hereunder shall be made without any
set-off or counterclaim.
(c) The Assignor and the Assignee shall each pay its own
costs and expenses incurred in connection with the negotiation, preparation,
execution and performance of this Assignment and Acceptance.
E-5.
110
(d) This Assignment and Acceptance may be executed in any
number of counterparts and all of such counterparts taken together shall be
deemed to constitute one and the same instrument.
(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF CALIFORNIA. THE
ASSIGNOR AND THE ASSIGNEE EACH IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN CALIFORNIA OVER ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS ASSIGNMENT AND
ACCEPTANCE AND IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH CALIFORNIA STATE OR FEDERAL
COURT. EACH PARTY TO THIS ASSIGNMENT AND ACCEPTANCE HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, 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 ASSIGNMENT AND ACCEPTANCE OR
ANY DOCUMENT RELATED HERETO, AND PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA/NEW
YORK LAW.
(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH THIS ASSIGNMENT AND ACCEPTANCE, AND ANY RELATED DOCUMENTS AND
AGREEMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY EITHER OF THE PARTIES
AGAINST THE OTHER PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. EACH OF THE PARTIES ALSO AGREES THAT ANY SUCH CLAIM OR CAUSE OF
ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
[Other provisions to be added as may be negotiated between the Assignor and the
Assignee, provided that such provisions are not inconsistent with the Credit
Agreement.]
E-6.
111
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
[ASSIGNOR]
By:
----------------------------
Title:
-------------------------
[ASSIGNEE]
By:
----------------------------
Title:
-------------------------
E-7.
112
EXHIBIT F
to the Credit Agreement
FORM OF PROMISSORY NOTE
U.S.$350,000,000 October ___, 1997
FOR VALUE RECEIVED, the undersigned, Storage Technology
Corporation, a Delaware corporation (hereinafter the "Company"), hereby
promises to pay to the order of Bank of America National Trust and Savings
Association (the "Bank") the principal sum of Three Hundred and Fifty Million
United States dollars (U.S.$350,000,000) or, if less, the aggregate unpaid
principal amount of all Loans made by the Bank to the Company pursuant to the
Credit Agreement, dated as of October ___, 1997 (as the same may be amended,
restated, supplemented or otherwise modified from time to time, being
hereinafter called the "Credit Agreement"), among the Company, the Bank, and
Bank of America National Trust and Savings Association, as Swingline Bank,
Issuing Bank and 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 of such schedules which continuations shall be
attached hereto and made a part hereof; provided, that any failure to endorse
such information on any 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") or the right of the Company to credit for any
payments made.
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. The maker hereby expressly waives presentment, demand,
protest or further notice of any kind in connection with the delivery,
acceptance, performance or enforcement of this Note.
Unless otherwise defined in this Note, terms defined in the
Credit Agreement are used herein as therein defined.
F-1.
113
This Note shall be governed by, and construed and interpreted
in accordance with, the laws of the State of California.
STORAGE TECHNOLOGY CORPORATION
By:
----------------------------
Name:
Title:
F-2.
114
Schedule A to Note
BASE RATE LOANS AND REPAYMENT OF BASE RATE LOANS
(2) (3) (4)
Amount Maturity Amount of
of Date of Base (5)
(1) Base Base Rate Loan Notation
Date Rate Loan Rate Loan Repaid Made By
---- --------- --------- ------ -------
F-3.
115
Schedule B to Note
OFFSHORE RATE LOANS AND REPAYMENT OF OFFSHORE RATE LOANS
(2) (3) (4)
Amount Maturity Amount of
of Date of Base (5)
(1) Base Base Rate Loan Notation
Date Rate Loan Rate Loan Repaid Made By
---- --------- --------- ------ -------
F-4.
116
Schedule 6.5
LITIGATION
[To be provided]
Schedule 6.11
PERMITTED LIABILITIES
[To be provided]
Schedule 6.12
ENVIRONMENTAL MATTERS
[To be provided]
Schedule 6.15
SUBSIDIARIES AND MINORITY INTERESTS
[To be provided]
Schedule 6.16
INSURANCE MATTERS
[To be provided]
Schedule 8.1(i)
PERMITTED LIENS
[To be provided]
Schedule 8.2
PERMITTED DISPOSITIONS
[To be provided]
Schedule 8.4(f)
PERMITTED INVESTMENTS
[To be provided]
Schedule 8.7(e)
CONTINGENT OBLIGATIONS
[To be provided]
SCHEDULE 11.2
LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
F-1.
117
Address for Funding Notices:
Bank of America National Trust
and Savings Association
Agency Administrative Services #5596
0000 Xxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxx, XX 00000-0000
Attention: Storage Tech. AO
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for all Other Notices:
Bank of America National Trust
and Savings Association
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Credit Products
High Technology-SF #3697
Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
AGENT'S PAYMENT OFFICE:
Bank of America National Trust
and Savings Association
(ABA 121-000-358)
Attention: Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
For credit to account:
No. 12334-15395
Ref: Storage Technology Corporation
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
as Swingline Bank
Lending Office and Office for
Borrowing Notices and Notices of
Conversion/Continuation:
Bank of America National Trust
and Savings Association
Agency Administrative Services #5596
0000 Xxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxx, XX 00000-0000
Attention: Storage Tech. AO
F-2.
118
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Bank of America National Trust
and Savings Association
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
Notices (other than Borrowing Notices and
Notices of Conversion/Continuation):
Bank of America National Trust
and Savings Association
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Credit Products
High Technology-SF #3697
Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as a Bank
Lending Office and Office for
Borrowing Notices and Notices of
Conversion/Continuation:
0000 Xxxxxxx Xxxxxxxxx, Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Notices (other than Borrowing Notices and Notices of
Conversion/Continuation):
Bank of America National Trust
and Savings Association
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Credit Products
High Technology-SF #3697
Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
F-3.
000
XXXX XX XXXXXXX NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Issuing Bank
Notices:
Bank of America National Trust and
Savings Association
Trade Operations Center #22621
000 X. Xxxxxxx Xxx., 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Bank of America National Trust
and Savings Association
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
Attention: Account Administrator
Global Payment Operations
Account Administration #5693
Facsimile: (000) 000-0000
and to:
Bank of America National Trust
and Savings Association
Agency Administrative Services #5596
0000 Xxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxx, XX 00000-0000
Attention: Storage Tech. AO
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Bank of America National Trust
and Savings Association
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Credit Products
High Technology-SF #3697
Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
F-4.
