EXHIBIT 10.2
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Credit Agreement
(364-Day/1-Year)
among
Quantum Corporation
and
Bank of America, N.A.,
as Administrative Agent
and
Fleet National Bank as Syndication Agent,
and
The Bank of Nova Scotia as Documentation Agent
and
The Other Financial
Institutions Party Hereto
Dated as of April 19, 0000
Xxxx xx Xxxxxxx Securities LLC,
as
Sole Arranger and Sole Book Manager
Bank of America[LOGO]
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TABLE OF CONTENTS
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Page
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SECTION 1. DEFINITIONS AND ACCOUNTING TERMS................................................................. 1
1.01 Defined Terms................................................................................... 1
1.02 Use of Certain Terms............................................................................ 21
1.03 Accounting Terms................................................................................ 21
1.04 Rounding........................................................................................ 21
1.05 Exhibits and Schedules.......................................................................... 21
1.06 References to Agreements and Laws............................................................... 21
SECTION 2. THE COMMITMENTS AND EXTENSIONS OF CREDIT......................................................... 22
2.01 Loans........................................................................................... 22
2.02 Borrowings, Conversions and Continuations of Loans.............................................. 22
2.03 Prepayments..................................................................................... 23
2.04 Reduction or Termination of Commitments......................................................... 23
2.05 Principal and Interest.......................................................................... 24
2.06 Fees............................................................................................ 24
2.07 Computation of Interest and Fees................................................................ 25
2.08 Making Payments................................................................................. 26
2.09 Funding Sources................................................................................. 27
SECTION 3. TAXES, YIELD PROTECTION AND ILLEGALITY........................................................... 27
3.01 Taxes........................................................................................... 27
3.02 Illegality...................................................................................... 28
3.03 Inability to Determine Rates.................................................................... 28
3.04 Increased Cost and Reduced Return; Capital Adequacy............................................. 28
3.05 Breakfunding Costs.............................................................................. 29
3.06 Matters Applicable to all Requests for Compensation............................................. 29
3.07 Survival........................................................................................ 30
SECTION 4. CONDITIONS PRECEDENT TO EXTENSIONS OF CREDIT..................................................... 30
4.01 Conditions of Initial Extension of Credit....................................................... 30
4.02 Conditions to all Extensions of Credit.......................................................... 31
SECTION 5. REPRESENTATIONS AND WARRANTIES................................................................... 32
5.01 Existence and Qualification; Power; Compliance with Laws........................................ 32
5.02 Power; Authorization; Enforceable Obligations................................................... 32
5.03 No Legal Bar.................................................................................... 32
5.04 Financial Statements; No Material Adverse Effect................................................ 33
5.05 Litigation...................................................................................... 33
5.06 No Default...................................................................................... 33
5.07 Ownership of Property; Liens.................................................................... 33
5.08 Taxes........................................................................................... 33
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5.09 Margin Regulations; Investment Company Act; Public Utility Holding Company Act................. 33
5.10 ERISA Compliance............................................................................... 34
5.11 Intangible Assets.............................................................................. 34
5.12 Compliance With Laws........................................................................... 35
5.13 Environmental Compliance....................................................................... 35
5.14 Insurance...................................................................................... 35
5.15 Swap Obligations............................................................................... 35
5.16 Disclosure..................................................................................... 35
SECTION 6. AFFIRMATIVE COVENANTS........................................................................... 35
6.01 Financial Statements........................................................................... 35
6.02 Certificates, Notices and Other Information.................................................... 36
6.03 Payment of Taxes............................................................................... 37
6.04 Preservation of Existence...................................................................... 37
6.05 Maintenance of Properties...................................................................... 38
6.06 Maintenance of Insurance....................................................................... 38
6.07 Compliance With Laws........................................................................... 38
6.08 Inspection Rights.............................................................................. 38
6.09 Keeping of Records and Books of Account........................................................ 38
6.10 Compliance with ERISA.......................................................................... 38
6.11 Compliance With Agreements..................................................................... 38
6.12 Use of Proceeds................................................................................ 38
SECTION 7. NEGATIVE COVENANTS.............................................................................. 39
7.01 Indebtedness................................................................................... 39
7.02 Liens.......................................................................................... 40
7.03 Fundamental Changes............................................................................ 41
7.04 Dispositions................................................................................... 42
7.05 Investments.................................................................................... 42
7.06 Restricted Payments............................................................................ 43
7.07 ERISA.......................................................................................... 43
7.08 Change in Nature of Business................................................................... 43
7.09 Transactions with Affiliates................................................................... 44
7.10 Use of Proceeds................................................................................ 44
7.11 Certain Indebtedness Payments, Etc............................................................. 44
7.12 Financial Covenants............................................................................ 45
7.13 Accounting Changes............................................................................. 46
SECTION 8. EVENTS OF DEFAULT AND REMEDIES.................................................................. 46
8.01 Events of Default.............................................................................. 46
8.02 Certain Financial Covenant Defaults............................................................ 48
8.03 Remedies Upon Event of Default................................................................. 48
SECTION 9. ADMINISTRATIVE AGENT............................................................................ 49
9.01 Appointment and Authorization of Administrative Agent.......................................... 49
9.02 Delegation of Duties........................................................................... 50
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9.03 Liability of Administrative Agent.............................................................. 50
9.04 Reliance by Administrative Agent............................................................... 50
9.05 Notice of Default.............................................................................. 51
9.06 Credit Decision; Disclosure of Information by Administrative Agent............................. 51
9.07 Indemnification of Administrative Agent........................................................ 52
9.08 Administrative Agent in Individual Capacity.................................................... 52
9.09 Successor Administrative Agent................................................................. 52
9.10 Syndication Agent; Documentation Agent......................................................... 53
SECTION 10. MISCELLANEOUS.................................................................................. 53
10.01 Amendments; Consents........................................................................... 53
10.02 Transmission and Effectiveness of Communications and Signatures................................ 54
10.03 Attorney Costs, Expenses and Taxes............................................................. 55
10.04 Binding Effect; Assignment..................................................................... 55
10.05 Set-off........................................................................................ 57
10.06 Sharing of Payments............................................................................ 57
10.07 No Waiver; Cumulative Remedies................................................................. 57
10.08 Usury.......................................................................................... 58
10.09 Counterparts................................................................................... 58
10.10 Integration.................................................................................... 58
10.11 Nature of Lenders' Obligations................................................................. 59
10.12 Survival of Representations and Warranties..................................................... 59
10.13 Indemnity by Borrower.......................................................................... 59
10.14 Nonliability of Lenders........................................................................ 59
10.15 No Third Parties Benefited..................................................................... 60
10.16 Severability................................................................................... 60
10.17 Confidentiality................................................................................ 60
10.18 Further Assurances............................................................................. 61
10.19 Headings....................................................................................... 61
10.20 Time of the Essence............................................................................ 61
10.21 Foreign Lenders................................................................................ 61
10.22 Removal and Replacement of Lenders............................................................. 62
10.23 Governing Law.................................................................................. 63
10.24 Waiver of Right to Trial by Jury............................................................... 63
10.25 Entire Agreement............................................................................... 64
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EXHIBITS
Form of
A Request for Extension of Credit
B Compliance Certificate
C Form of Note
D Notice of Assignment and Acceptance
E Term Conversion Request
SCHEDULES
2.01 Commitments and Pro Rata Shares
5.05 Litigation
7.01 Existing Indebtedness and Liens
7.13 Subordination Provisions
10.02 Offshore and Domestic Lending Offices, Addresses for Notices
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CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of April 19, 2000,
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by and among Quantum Corporation, a Delaware corporation ("Borrower"), each
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lender from time to time party hereto (collectively, "Lenders" and individually,
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a "Lender"), and BANK OF AMERICA, N.A., as Administrative Agent.
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RECITAL
Borrower has requested that Lenders provide a revolving line of credit, and
Lenders and Administrative Agent are willing to do so on the terms and
conditions set forth herein.
In consideration of the mutual covenants and agreements herein contained,
the parties hereto covenant and agree as follows:
SECTION 1.
DEFINITIONS AND ACCOUNTING TERMS
1.01 Defined Terms. As used in this Agreement, the following terms shall
have the meanings set forth below:
"Acquisitions" means any transaction or series of related transactions for
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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 line of business
or any division of a Person, (b) the acquisition of in excess of 50% of the
capital stock, partnership interests or equity of any Person, or otherwise
causing any Person to become a Subsidiary, or (c) a merger or consolidation or
any other combination with another Person (other than a Person that is a
Subsidiary).
"Administrative Agent" means Bank of America, N.A., in its capacity as
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administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means Administrative Agent's address and,
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as appropriate, account as set forth on Schedule 10.02, or such other address or
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account as Administrative Agent hereafter may designate by written notice to
Borrower and Lenders.
"Administrative Agent-Related Persons" means Administrative Agent
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(including any successor agent), together with its Affiliates (including, in the
case of Bank of America in its capacity as Administrative Agent, the Arranger),
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.
"Affiliate" means any Person directly or indirectly controlling, controlled
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by, or under direct or indirect common control with, another Person. A Person
shall be deemed to be "controlled by" any other Person if such other Person
possesses, directly or indirectly, power (a) to vote 10% or more of the
securities (on a fully diluted basis) having ordinary voting power
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for the election of directors or managing general partners; or (b) to direct or
cause the direction of the management and policies of such Person whether by
contract or otherwise; provided that Persons, other than Subsidiaries, in which
Quantum Technology Ventures holds Equity Securities shall not be "Affiliates"
for purposes of this definition.
"Agreement" means this Credit Agreement, as amended, restated, extended,
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supplemented or otherwise modified in writing from time to time.
"Applicable Amount" means the following amounts per annum, based upon the
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Leverage Ratio as set forth in the most recent Compliance Certificate received
by Administrative Agent pursuant to Section 6.02(a), provided, however, that,
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until the six month anniversary of the Closing Date, such amounts shall be fixed
as indicated for pricing level 3 set forth below:
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Applicable Amount (in basis points per annum)
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Applicable LIBOR Applicable Base
Level Leverage Ratio Margin Rate Margin Commitment fee Utilization Fee
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1 <0.75:1 112.50 12.50 20.00 12.50
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2 *0.75:1 but <1.00:1 125.00 25.00 22.50 12.50
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3 *1.00:1 but <1.25:1 137.50 37.50 25.00 12.50
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4 *1.25:1 but <1.50:1 150.00 50.00 27.50 12.50
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5 *1.50 175.00 75.00 32.50 12.50
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* More than or equal to
The Applicable Amount shall be in effect from the date the most recent
Compliance Certificate is received by Administrative Agent to but excluding the
date the next Compliance Certificate is received.
"Applicable Payment Date" means, (a) as to any Offshore Rate Loan, the last
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day of the relevant Interest Period, any date that such Loan is prepaid or
converted in whole or in part and, with respect to Revolving Loans, the
Revolving Termination Date, and with respect to Term Loans, the Term Maturity
Date; provided, however, that if any Interest Period for an Offshore Rate Loan
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exceeds three months, interest shall also be paid on the date which falls every
three months after the beginning of such Interest Period; and (b) as to any
other Obligations, the last Business Day of each calendar quarter and, with
respect to Revolving Loans, the Revolving Termination Date, and, with respect to
Term Loans, the Term Maturity Date; provided, further, that interest accruing at
the Default Rate shall be payable from time to time upon demand of
Administrative Agent.
"Applicable Time" means California time.
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"Arranger" means Banc of America Securities LLC, in its capacity as sole
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arranger and sole book manager.
"Assignment and Acceptance" means an Assignment and Acceptance
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substantially in the form of Exhibit D.
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"Attorney Costs" means and includes all fees and disbursements of any law
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firm or other external counsel and the allocated cost of internal legal services
and all disbursements of internal counsel.
"Audited Financial Statements" means the audited consolidated balance sheet
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of Borrower and its Subsidiaries for the fiscal year ended March 31, 1999, and
the related consolidated statements of income and cash flows for such fiscal
year of Borrower.
"Bank of America" means Bank of America, N.A.
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"Base Rate" means a fluctuating rate per annum equal to the higher of (a)
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the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for
such day as publicly announced from time to time by Bank of America as its
"prime rate." Such rate is a rate set by Bank of America based upon various
factors including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.
"Base Rate Loan" means a Loan made hereunder and specified to be a Base
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Rate Loan in accordance with Section 2.
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"Borrower" has the meaning set forth in the introductory paragraph hereto.
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"Borrowing" and "Borrow" each mean a borrowing of Loans hereunder.
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"Borrowing Date" means the date that a Loan is made, which shall be a
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Business Day.
"Business Day" means any day other than a Saturday, Sunday, or other day on
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which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where Administrative Agent's Office is located and, if such
day relates to any Offshore Rate Loan, means any such day on which dealings in
Dollar deposits are conducted by and between banks in the offshore Dollar
interbank market.
"Capital Leases" means any and all leases under which certain obligations
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are required to be capitalized on the books of a lessee in accordance with GAAP.
"Change of Control" means the direct or indirect acquisition by any person
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(as such term is used in Section 13(d) and Section 14(d)(2) of the Exchange
Act), or related persons constituting a group (as such term is used in Rule 13d-
5 under the Exchange Act), of (a) beneficial ownership of the issued and
outstanding shares of voting stock of a corporation or other entity, the result
of which acquisition is that such person or group possesses in excess of 40% of
the combined voting power of all then-issued and outstanding voting stock of
such corporation or other entity, or (b) the power to elect, appoint, or cause
the election or appointment of at least a majority of the members of the board
of directors of such corporation or other entity.
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"Closing Date" means the date all the conditions precedent in Section 4.01
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are satisfied or waived in accordance with Section 4.01.
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"Code" means the Internal Revenue Code of 1986.
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"Commitment" means, for each Lender, the amount set forth opposite such
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Lender's name on Schedule 2.01, as such amount may be reduced or adjusted from
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time to time in accordance with the terms of this Agreement (collectively, the
"combined Commitments").
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"Compliance Certificate" means a certificate substantially in the form of
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Exhibit B, properly completed and signed by a Responsible Officer of Borrower.
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"Consolidated EBITDA" means, for any period, for Borrower and its
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Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated Net Income, (b) Consolidated Interest Charges, (c) the amount of
taxes, based on or measured by income, used or included in the determination of
such Consolidated Net Income, (d) the amount of depreciation and amortization
expense deducted in determining such Consolidated Net Income, (e) the amount
written off in connection with In-Process Research & Development related to the
Meridian Acquisition in the second fiscal quarter of year 2000, (f) the charge
taken in the second fiscal quarter of year 2000 in connection with HDD, (g) the
charge taken in the fourth fiscal quarter of year 2000 in connection with DSS,
and (h) the amount of any charges taken in connection with In-Process Research &
Development associated with Acquisitions provided that (i) any such charges are
taken during the fiscal quarter in which the related Acquisition was completed
and (ii) for purposes of calculating In-Process Research & Development charges
under this clause (h), the aggregate amount of any such charges does not exceed
$100,000,000 over the term of this Agreement.
"Consolidated Funded Indebtedness" means, as of any date of determination,
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for Borrower and its Subsidiaries on a consolidated basis, the sum of (a) the
outstanding principal amount of all obligations and liabilities, whether current
or long-term, for borrowed money (including Obligations to the extent consisting
of principal), (b) that portion of obligations with respect to Capital Leases
that would in conformity with GAAP be capitalized on the consolidated balance
sheet of Borrower and its Subsidiaries, and (c) Synthetic Lease Obligations.
"Consolidated Interest Charges" means, for any period, for Borrower and its
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Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, fees, charges and related expenses payable by Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, (b) the portion of rent
payable by Borrower and its Subsidiaries with respect to such period under
Capital Leases that is treated as interest in accordance with GAAP and (c) the
portion of rent under any Synthetic Lease Obligation that would be treated as
interest in accordance with GAAP if the Synthetic Lease Obligation were treated
as a Capital Lease under GAAP.
"Consolidated Net Income" means, for any period, for Borrower and its
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Subsidiaries on a consolidated basis, the net income of Borrower and its
Subsidiaries from continuing operations after extraordinary items for that
period.
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"Consolidated Tangible Net Worth" means, as of any date of determination,
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for Borrower and its Subsidiaries on a consolidated basis, Shareholders' Equity
of Borrower and its Subsidiaries on that date minus the Intangible Assets of
Borrower and its Subsidiaries on that date.
"Continuation" and "Continue" mean, with respect to any Offshore Rate Loan,
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the continuation of such Offshore Rate Loan as an Offshore Rate Loan on the last
day of the Interest Period for such Loan.
"Contractual Obligation" means, as to any Person, any provision of any
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security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its property is bound.
"Conversion" and "Convert" mean, with respect to any Loan, the conversion
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of such Loan from or into another type of Loan.
"Convertible Subordinated Debentures" means the 7% Convertible Subordinated
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Notes due 2004 issued by Borrower pursuant to the Indenture dated as of August
1, 1997 and the Supplemental Indenture dated as of August 1, 1997 between
Borrower and LaSalle National Trust Company, N.A., as Trustee.
"Debtor Relief Laws" means the Bankruptcy Code of the United States of
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America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect affecting the rights
of creditors generally.
"Default" means any event that, with the giving of any notice, the passage
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of time, or both, would be an Event of Default.
"Default Rate" means an interest rate equal to the Base Rate plus the
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Applicable Amount, if any, applicable to Base Rate Loans plus 2% per annum;
provided, however, that with respect to an Offshore Rate Loan, the Default Rate
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shall be an interest rate equal to the interest rate (including any Applicable
Amount) otherwise applicable to such Loan plus 2% per annum, in each case to the
fullest extent permitted by applicable Laws.
"Designated Deposit Account" means a deposit account maintained by Borrower
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with Bank of America, as from time to time designated by Borrower to
Administrative Agent by Requisite Notice.
"Disposition" or "Dispose" means the sale, transfer, License Disposition or
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other disposition (including any sale and leaseback transaction) of any property
by any Person, including any sale, assignment, transfer or other disposal with
or without recourse of any notes or accounts receivable or any rights and claims
associated therewith.
"Dollar" and "$" means lawful money of the United States of America.
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"DSS" means DLT and Storage Systems Group, a reportable business segment of
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Borrower, as indicated in Borrower's latest quarterly report filed with the
Securities and Exchange Commission on form 10-Q.
"Eligible Assignee" means (a) a financial institution organized under the
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laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development, or a political subdivision of any such country, and
having a combined capital and surplus of at least $100,000,000, provided that
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such bank is acting through a branch or agency located in the United States; (c)
a Person that is primarily engaged in the business of commercial banking and
that is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a Person of which a
Lender is a Subsidiary, or (iii) a Person of which a Lender is a Subsidiary; (d)
another Lender; (e) any other entity which is an "accredited investor" (as
defined in Regulation D under the Securities Act of 1933, as amended) which
extends credit or buys loans as one of its businesses, including but not limited
to, insurance companies, mutual funds and lease financing companies; or (f)
other lenders or institutional investors consented to in writing in advance by
Administrative Agent and Borrower. Neither Borrower nor any Affiliate of
Borrower shall be an Eligible Assignee.
"Employee Benefit Plan" means any employee benefit plan within the meaning
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of section 3(3) of ERISA, maintained or contributed to by Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.
"Environmental Laws" means all Laws relating to environmental, health,
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safety and land use matters applicable to any property.
"Equity Securities" of any Person means (a) all common stock, preferred
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stock, participations, shares, partnership interests or other equity interests
in such Person (regardless of how designated and whether or not voting or
non-voting) and (b) all warrants, options and other rights to acquire any of the
foregoing, other than convertible debt securities which have not been converted
into common stock, preferred stock, participations, shares, partnership
interests or other equity interests in any such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974.
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"ERISA Affiliate" means any trade or business (whether or not incorporated)
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under common control with Borrower within the meaning of Sections 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;
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(b) a withdrawal by 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 that is treated as such a withdrawal under Section 4062(e) of ERISA;
(c) a complete or partial withdrawal by 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
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as a termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon Borrower or any ERISA
Affiliate.
"Event of Default" means any of the events specified in Section 8.
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"Existing Credit Facility" means that certain Credit Agreement, dated as of
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June 6, 1997, among Borrower, Canadian Imperial Bank of Commerce, as
administrative agent, and a syndicate of lenders.
"Extension of Credit" means a Borrowing, Conversion, Continuation or Term
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Conversion of Loans.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
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upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
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(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate charged to Bank of America on such day on such
transactions as determined by Administrative Agent.
"GAAP" means generally accepted accounting principles set forth in the
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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 such other principles as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination, consistently
applied. If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either
Borrower or Requisite Lenders shall so request, Administrative Agent, Lenders
and Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in GAAP (subject to
the approval of Requisite Lenders), provided that, until so amended, (a) such
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ratio or requirement shall continue to be computed in accordance with GAAP prior
to such change therein and (b) Borrower shall provide to Administrative Agent
and Lenders financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a reconciliation
between calculations of such ratio or requirement made before and after giving
effect to such change in GAAP.
"Governmental Authority" means (a) any international, foreign, federal,
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state, county or municipal government, or political subdivision thereof, (b) any
governmental or quasi-governmental agency, authority, board, bureau, commission,
department, instrumentality, central bank or public body, or (c) any court,
administrative tribunal or public utility.
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"Guaranty Obligation" means, as to any Person, any (a) guaranty by such
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Person of Indebtedness of, or other obligation payable or performable by, any
other Person or (b) assurance, agreement, letter of responsibility, letter of
awareness, undertaking or arrangement given by such Person to an obligee of any
other Person with respect to the payment or performance of an obligation by, or
the financial condition of, such other Person, whether direct, indirect or
contingent, including any purchase or repurchase agreement covering such
obligation or any collateral security therefor, any agreement to provide funds
(by means of loans, capital contributions or otherwise) to such other Person,
any agreement to support the solvency or level of any balance sheet item of such
other Person or any "keep-well" or other arrangement of whatever nature, in each
such case, given for the purpose of assuring or holding harmless such obligee
against loss with respect to any obligation of such other Person; provided,
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however, that the term Guaranty Obligation shall not include endorsements of
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instruments for deposit or collection in the ordinary course of business. The
amount of any Guaranty Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the related primary obligation, or portion
thereof, covered by such Guaranty Obligation or, if not stated or determinable,
the maximum reasonably anticipated liability in respect thereof as determined by
the Person in good faith.
"HDD" means Hard Disk Drive Group, a reportable business segment of
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Borrower, as indicated in Borrower's latest quarterly report filed with the
Securities and Exchange Commission on form 10-Q.
"In-Process Research & Development" means purchased in-process research
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and development, as specified on Borrower's statement of income in accordance
with GAAP.
"Indebtedness" means, as to any Person at any date of determination, all
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items which would, in conformity with GAAP, be classified as liabilities on a
balance sheet of such Person as at such date excluding (i) trade and other
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accounts payable in the ordinary course of business in accordance with customary
trade terms and which are not overdue for a period of more than 60 days (unless
contested in good faith by Borrower or any Subsidiary), (ii) deferred taxes, and
(iii) accrued interest and expenses, except to the extent capitalized, and in
any event including:
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(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) any direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial), banker's acceptances,
bank guaranties, surety bonds and similar instruments;
(c) whether or not so included as liabilities in accordance with
GAAP, net obligations under any Swap Contract in an amount equal to (i) if
such Swap Contract has been closed out, the termination value thereof, or
(ii) if such Swap Contract has not been closed out, the xxxx-to-market
value thereof determined on the basis of readily available quotations
provided by any recognized dealer in such Swap Contract;
(d) whether or not so included as liabilities in accordance with GAAP
and whether with or without recourse, all obligations of such Person to pay
the deferred
-8-
purchase price of property or services, and indebtedness (excluding prepaid
interest thereon) secured by a Lien on property owned or being purchased by
such Person (including indebtedness arising under conditional sales or
other title retention agreements);
(e) lease payment obligations under Capital Leases or Synthetic Lease
Obligations; and
(f) all Guaranty Obligations of such Person in respect of any of the
foregoing obligations of any other Person.
For all purposes of this Agreement, the Indebtedness of any Person shall
include, at any such time as such partnership or joint venture is not Solvent,
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, unless such Indebtedness is expressly made
non-recourse to such Person (subject to customary recourse exceptions acceptable
to Requisite Lenders).
"Indemnified Liabilities" has the meaning set forth in Section 10.13.
----------------------- -------------
"Indemnitees" has the meaning set forth in Section 10.13.
----------- -------------
"Intangible Assets" means assets that are required to be disclosed as
-----------------
intangible assets in accordance with GAAP on Borrower's balance sheet, including
customer lists, goodwill, computer software, copyrights, trade names, trade
marks, patents, unamortized deferred charges, unamortized debt discount and
capitalized research and development costs.
"Interest Period" means for each Offshore Rate Loan, (i) initially, the
---------------
period commencing on the date such Offshore Rate Loan is disbursed or Continued
or Converted into such Offshore Rate Loan and (ii) thereafter, the period
commencing on the last day of the preceding Interest Period, and ending, in each
case, on the earlier of (x) the scheduled Revolving Termination Date (in the
case of Revolving Loans) or the scheduled Term Maturity Date (in the case of
Term Loans), or (y) one, two, three or six months thereafter or, to the extent
acceptable to all Lenders, as otherwise requested by Borrower; provided that:
--------
(A) any Interest Period that would otherwise end on a day that
is not a Business Day shall be extended to the next succeeding
Business Day unless such Business Day falls in another calendar month,
in which case such Interest Period shall end on the next preceding
Business Day;
(B) any Interest Period which 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) unless Administrative Agent otherwise consents, there may
not be more than eight Interest Periods for Offshore Rate Loans in
effect at any time.
-9-
"Investment" means, as to any Person, any investment by such Person,
----------
whether by means of the purchase or other acquisition of stock or other
securities of any other Person or by means of a loan, creating a debt, capital
contribution, guaranty or other debt or equity participation or interest in any
other Person. For purposes of covenant compliance, the amount of any Investment
shall be the amount actually invested, without adjustment for subsequent
increases or decreases in the value of such Investment.
"IRS" means the United States Internal Revenue Service.
---
"Laws" or "Law" means all international, foreign, federal, state and local
---- ---
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"Lender" means each lender from time to time party hereto.
------
"Lending Office" means, as to any Lender, the office or offices of such
--------------
Lender described as such on Schedule 10.02, or such other office or offices as a
Lender may from time to time notify Administrative Agent.
"Leverage Ratio" means, as of any date of determination, for Borrower and
--------------
its Subsidiaries on a consolidated basis, the ratio of (a) Consolidated Funded
Indebtedness as of such date to (b) Consolidated EBITDA for the period of the
four fiscal quarters ending on, or ending most recently prior to, such date.
"License Disposition" means, in respect of any patent, trademark,
-------------------
copyright, mask work, trade secret or other intellectual property right owned or
held by Borrower or any of its Subsidiaries (the "IP Holder") which is material
---------
to Borrower or any of its Subsidiaries (together, "Material IP"), (i) the
-----------
granting by the IP Holder of an exclusive license across all or substantially
all fields, uses or regions to any Person other than Borrower or another
Subsidiary, (ii) the granting of any license by the IP Holder that conveys
directly or indirectly to any Person other than Borrower or its Subsidiaries all
or substantially all of the economic value of such Material IP, or (iii) the
abandonment by the IP Holder of such Material IP.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
----
arrangement (including in the nature of, cash collateral accounts or security
interests), encumbrance, lien (statutory or other), fixed or floating charge, or
other security interest of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the Uniform Commercial Code or comparable Laws
of any jurisdiction), including the interest of a purchaser of accounts
receivable.
"Loan" means a Revolving Loan or a Term Loan made to Borrower by a Lender
----
in accordance with its Pro Rata Share, in each case pursuant to Section 2
---------
(collectively, the "Loans").
-----
-10-
"Loan Documents" means this Agreement and each Note, each Request for
--------------
Extension of Credit, each certificate, each fee letter, and each other
instrument, or agreement from time to time executed by Borrower or any of its
Subsidiaries or any Responsible Officer and delivered in connection with this
Agreement.
"Master Agreement" has the meaning set forth in the definition of "Swap
---------------- ----
Contract".
--------
"Material Adverse Effect" means any set of circumstances or events which
-----------------------
(a) has any material adverse effect upon the validity or enforceability of any
Loan Document, (b) is material and adverse to the financial condition, business,
assets or operations of Borrower, or (c) materially impairs the ability of
Borrower to perform the Obligations.
"Material Subsidiaries" means each Subsidiary of Borrower which has assets
---------------------
with a total book value greater than 10% of the consolidated total assets of
Borrower and its Subsidiaries, determined as of the end of the fiscal quarter
immediately preceding the date of determination.
"Meridian Acquisition" means the acquisition by DSS of Meridian Data, Inc.,
--------------------
which was completed on or about September 10, 1999.
"Minimum Amount" means, with respect to each of the following actions, the
--------------
minimum amount and any multiples in excess thereof set forth opposite such
action:
Type of Action Minimum Multiples in
Amount excess thereof
Borrowing or prepayment of, or Conversion $ 5,000,000 $1,000,000
into, Base Rate Loans
Borrowing, prepayment or Continuation of, $ 5,000,000 $1,000,000
or Conversion into, Offshore Rate Loans
Reduction in Commitments $10,000,000 $1,000,000
Assignments $10,000,000 None
"MKE" means Matsushita-Kotobuki Electronics Industries, Ltd., a Japanese
---
corporation.
"Multiemployer Plan" means any employee benefit plan of the type described
------------------
in Section 4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any sale or issuance of any Equity
------------
Security or other security by any Person (including in the case of Borrower, any
sale or issuance of any Subordinated Debt), the aggregate consideration received
by such Person from such sale or issuance less the actual amount of fees and
----
commissions payable to Persons other than such Person or any Affiliate of such
Person.
-11-
"Note" means a promissory note made by Borrower in favor of a Lender
----
evidencing Loans made by such Lender, substantially in the form of Exhibit C
---------
(collectively, the "Notes").
-----
"Obligations" means all advances to, and debts, liabilities, obligations,
-----------
covenants and duties of, Borrower arising under any Loan Document, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest that accrues after the commencement of any proceeding under
any Debtor Relief Laws by or against Borrower or any Subsidiary or Affiliate of
Borrower.
"Offshore Base Rate" has the meaning set forth in the definition of
------------------
Offshore Rate.
"Offshore Rate" means for any Interest Period with respect to each Offshore
-------------
Rate Loan comprising part of the same Borrowing, a rate per annum determined by
Administrative Agent pursuant to the following formula:
Offshore Rate = Offshore Base Rate
-----------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Offshore Base Rate" means, for such Interest Period:
------------------
(a) the rate per annum equal to the rate determined by Administrative
Agent to be the offered rate that appears on the page of the Telerate LIBOR
screen (currently, page 3750) that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for delivery
on the first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period, or
(b) if the rate referenced in the preceding subsection (a) does not
appear on such page or service or such page or service shall cease to be
available, the rate per annum (rounded upwards to the fourth decimal place)
equal to the rate determined by Administrative Agent to be the offered rate
on such other page or other service that displays an average British
Bankers Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of such Interest Period) with a term equivalent
to such Interest Period, determined as of approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period, or
(c) if the rates referenced in the preceding subsections (a) and (b)
are not available, the rate per annum determined by Administrative Agent as
the rate of interest at which Dollar deposits (for delivery on the first
day of such Interest Period) in same day funds in the approximate amount of
the Offshore Rate Loan being made, Continued or Converted into by the
Administrative Agent or its Affiliate in its capacity as a Lender
hereunder, and with a term equivalent to such Interest Period would be
offered by Bank of America's London Branch to major banks in the offshore
Dollar market at their request at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period .
-12-
"Eurodollar Reserve Percentage" means, for any day during any Interest
-----------------------------
Period, the reserve percentage (expressed as a decimal, rounded upward to the
next 1/100th of 1%) in effect on such day, whether or not applicable to any
Lender, under regulations issued from time to time by the Board of Governors of
the Federal Reserve System for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"). The Offshore Rate for each outstanding Offshore Rate Loan shall
be adjusted automatically as of the effective date of any change in the
Eurodollar Reserve Percentage. The determination of the Eurodollar Reserve
Percentage and the Offshore Base Rate by Administrative Agent shall be
conclusive in the absence of manifest error.
"Offshore Rate Loan" means a Loan made hereunder and specified to be a
------------------
Offshore Rate Loan in accordance with Section 2.
---------
"Ordinary Course Dispositions" means:
----------------------------
(a) Dispositions of surplus equipment or damaged, obsolete or worn
out property, whether now owned or hereafter acquired, in the ordinary
course of business;
(b) Dispositions in the ordinary course of business;
(c) Dispositions of property to the extent that such property is
exchanged for credit against the purchase price of similar replacement
property, or the proceeds of such sale are reasonably promptly applied to
the purchase price of such replacement property or where Borrower or its
Subsidiary determine in good faith that the failure to replace such
equipment will not be detrimental to the business of Borrower or such
Subsidiary;
(d) Dispositions of assets or property by any Subsidiary of Borrower
to Borrower or another Subsidiary of Borrower;
(e) Dispositions which constitute the making or liquidating of
Permitted Investments; and
(f) Dispositions which constitute the incurrence (but not the
enforcement) of Permitted Liens;
provided, however, that, other than with respect to Dispositions of the
-------- -------
types described in clauses (a) and (d) of this definition, no such Disposition
shall be for less than the fair market value of the property being disposed of.
"Ordinary Course Indebtedness" means:
----------------------------
(a) Indebtedness under the Loan Documents;
(b) intercompany Guaranty Obligations of Borrower or any of its
Subsidiaries guarantying Indebtedness otherwise permitted hereunder of
Borrower or any Subsidiary of Borrower;
-13-
(c) Indebtedness arising from the honoring of a check, draft or
similar instrument against insufficient funds or from the endorsement of
instruments for collection in the ordinary course of Borrower's or any
Subsidiary's business;
(d) Permitted Swap Obligations; and
(e) Indebtedness of Borrower or any of its Subsidiaries with respect
to surety, appeal, indemnity, performance or other similar bonds in the
ordinary course of business.
"Ordinary Course Investments" means Investments consisting of:
---------------------------
(a) Investments in other assets properly classified as "marketable
securities" or "cash" or "cash equivalents" under GAAP, and which conform
to the investment policies adopted by the Board of Directors of Borrower
from time to time;
(b) advances to officers, directors and employees of Borrower and its
Subsidiaries for travel, entertainment, relocation and analogous ordinary
business purposes;
(c) Investments of Borrower in any of its Subsidiaries and
Investments of any Subsidiary of Borrower in Borrower or another Subsidiary
of Borrower;
(d) extensions of credit to customers or suppliers of Borrower and
its Subsidiaries in the ordinary course of business and any Investments
received in satisfaction or partial satisfaction thereof;
(e) Guaranty Obligations permitted by Section 7.01.
------------
(f) Investments received by Borrower or any of its Subsidiaries as
distributions on claims in connection with the bankruptcy or reorganization
of customers or suppliers and in settlement of delinquent obligations of,
and other disputes with, customers and suppliers arising in the ordinary
course of business;
(g) Investments of any Subsidiary existing at the time it becomes a
Subsidiary of Borrower, provided that such Investments were not made in
--------
anticipation of such Person becoming a Subsidiary of Borrower; and
(h) Investments consisting of loans to employees, officers and
directors, the proceeds of which shall be used to purchase Equity
Securities of Borrower or its Subsidiaries and other loans to employees,
officers and directors.
"Ordinary Course Liens" means:
---------------------
(a) Liens pursuant to any Loan Document;
(b) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance
with GAAP;
-14-
(c) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are
not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings, if adequate reserves with
respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(d) pledges or deposits in connection with worker's compensation,
unemployment insurance and other social security legislation;
(e) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(f) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from
the value of the property subject thereto or materially interfere with the
ordinary conduct of the business of any Person;
(g) attachment, judgment or other similar Liens arising in connection
with litigation or other legal proceedings (and not otherwise an Event of
Default hereunder) in the ordinary course of business that is currently
being contested in good faith by appropriate proceedings, adequate reserves
have been set aside, and no material property is subject to a material risk
of loss or forfeiture;
(h) Liens on the property or assets of any Subsidiary of Borrower in
favor of Borrower or any other Subsidiary of Borrower;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties and in connection with
the importation of goods in the ordinary course of Borrower's and its
Subsidiaries' businesses;
(j) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a
creditor depository institution; provided that (i) such deposit account is
--------
not a dedicated cash collateral account and is not subject to restrictions
against access by Borrower in excess of those set forth by regulations
promulgated by the Federal Reserve Board, and (ii) such deposit account is
not intended by Borrower or any Subsidiary to provide collateral to the
depository institution; and
(k) Liens on insurance proceeds in favor of insurance companies with
respect to the financing of insurance premiums.
"Organization Documents" means, (a) with respect to any corporation, the
----------------------
certificate or articles of incorporation and the bylaws; (b) with respect to any
limited liability company, the articles of formation and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership or joint venture agreement and any agreement,
instrument, filing or notice with respect thereto filed in connection with its
formation
-15-
with the secretary of state or other department in the state of its formation,
in each case as amended from time to time.
"Outstanding Obligations" means, as of any date, and giving effect to
-----------------------
making any Extensions of Credit requested on such date and all payments,
repayments and prepayments made on such date, (a) when reference is made to all
Lenders, the aggregate outstanding principal amount of all Loans, and (b) when
reference is made to one Lender, the aggregate outstanding principal amount of
all Loans made by such Lender.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
----
thereto established under ERISA.
"Pension Plan" means any "employee pension benefit plan" (as such term is
------------
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions at any time during
the immediately preceding five plan years.
"Permitted Indebtedness" has the meaning specified in Section 7.01.
---------------------- ------------
"Permitted Investments" has the meaning specified in Section 7.05.
--------------------- ------------
"Permitted Liens" has the meaning specified in Section 7.02.
--------------- ------------
"Permitted Receivables Facility" means one or more accounts receivable
------------------------------
financing arrangements including (i) the sale of accounts receivable and any
related property by Borrower and/or any of its Subsidiaries to a financing party
or a special purpose vehicle, and/or (ii) the granting of a security interest in
accounts receivable and any related property by Borrower and/or any of its
Subsidiaries, provided, however, that the aggregate advances under such accounts
-------- -------
receivable financing arrangements shall not exceed $200,000,000 at any one time.
"Permitted Swap Obligations" means all obligations (contingent or
--------------------------
otherwise) of Borrower or any of its Subsidiaries existing or arising under Swap
Contracts, provided that such obligations are (or were) entered into by such
--------
Person in the ordinary course of business for the purpose of directly mitigating
risks associated with liabilities, commitments or assets held or reasonably
anticipated by such Person, or changes in the value of securities issued by such
Person in conjunction with a securities repurchase program not otherwise
prohibited hereunder, and not for purposes of speculation or taking a "market
view."
"Person" means any individual, trustee, corporation, general partnership,
------
limited partnership, limited liability company, joint stock company, trust,
unincorporated organization, bank, business association, firm, joint venture,
Governmental Authority, or otherwise.
"Plan" means any employee benefit plan maintained or contributed to by
----
Borrower or by any trade or business (whether or not incorporated) under common
control with Borrower as defined in Section 4001(b) of ERISA and insured by the
Pension Benefit Guaranty Corporation under Title IV of ERISA.
-16-
"Pro Rata Share" means, with respect to each Lender, the percentage of the
--------------
combined Commitments set forth opposite the name of such Lender on Schedule
2.01, as such share may be adjusted as contemplated herein.
"Quantum Technology Ventures" means Quantum Technology Ventures, a Delaware
---------------------------
corporation in formation.
"Quick Ratio" means, with respect to Borrower and its Subsidiaries at any
-----------
time, the ratio, determined on a consolidated basis in accordance with GAAP, of:
(a) the sum at such time of all (i) cash and cash equivalents of Borrower and
its Subsidiaries (excluding restricted cash) and (ii) accounts receivable of
Borrower and its Subsidiaries, less all reserves therefor; to (b) the sum at
--
such time of (i) the current liabilities of Borrower and its Subsidiaries
(including any such liabilities outstanding under this facility), plus (ii) to
----
the extent not included in clause (i), Outstanding Obligations.
"Reportable Event" means any of the events set forth in Section 4043(b) of
----------------
ERISA or the regulations thereunder, a withdrawal from a Plan described in
Section 4063 of ERISA, or a cessation of operations described in Section 4062(e)
of ERISA.
"Request for Extension of Credit" means, unless otherwise specified herein,
-------------------------------
with respect to a Borrowing, Conversion or Continuation of Loans, a written
request substantially in the form of Exhibit A, and, with respect to a Term
Conversion, a Term Conversion Request, in each case, duly completed and signed
by a Responsible Officer of Borrower and delivered by Requisite Notice.
"Requisite Lenders" means, as of any date of determination: (a) if the
-----------------
Commitments are then in effect, Lenders (excluding any Lenders not funding when
required to so hereunder) having in the aggregate more than 50% of the combined
Commitments then in effect and (b) if the Commitments have then been terminated
and there are Outstanding Obligations, Lenders holding Outstanding Obligations
aggregating more than 50% of such Outstanding Obligations.
"Requisite Notice" means, unless otherwise provided herein, (a) irrevocable
----------------
written notice to the intended recipient or (b) irrevocable telephonic notice to
the intended recipient, promptly followed by a written notice to such recipient.
Such notices shall be (i) delivered to such recipient at the address or
telephone number specified on Schedule 10.02 or as otherwise designated by such
--------------
recipient by Requisite Notice to Administrative Agent, and (ii) if made by
Borrower, given or made by a Responsible Officer of Borrower. Any written notice
delivered in connection with any Loan Document shall be in the form, if any,
prescribed herein or therein. Any notice sent by other than hardcopy shall be
promptly confirmed by a telephone call to the recipient and, if requested by
Administrative Agent, by a manually-signed hardcopy thereof.
"Requisite Time" means, with respect to any of the actions listed below,
--------------
the time and date set forth below opposite such action:
-17-
Type of Action Applicable Date of Action
Time
----------------------------------------------------------------------------------------------------
Delivery of Request for Extension of
Credit for, or notice for:
. Borrowing or prepayment of, or 9:00 a.m. Same date as such Borrowing,
Conversion into, Base Rate Loans prepayment or Conversion
. Borrowing, prepayment or 9:00 a.m. 3 Business Days prior to such
Continuation of, or Conversion Borrowing, prepayment Continuation
into, Offshore Rate Loans or Conversion
. Voluntary reduction in or 10:00 a.m. 3 Business Days prior to such
termination of Commitments reduction or termination
. Term Conversion 10:00 a.m. 10 days prior to the Revolving
Termination Date
Payments by Lenders or Borrower to 11:00 a.m. On date payment is due
Administrative Agent
"Responsible Officer" means the president, chief financial officer, vice
-------------------
president-finance, treasurer or assistant treasurer of Borrower. Any document or
certificate hereunder that is signed by a Responsible Officer of Borrower shall
be conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of Borrower and such Responsible
Officer shall be conclusively presumed to have acted on behalf of Borrower.
"Restricted Payment" means:
------------------
(a) the declaration or payment of any dividend or distribution by
Borrower or any Subsidiary, either in cash or property, on any shares of
the capital stock of any class of Borrower or any Subsidiary; and
(b) any other payment or distribution by Borrower or any Subsidiary
in respect of its capital stock, either directly or indirectly.
"Revolving Loans" means a Base Rate Loan or an Offshore Rate Loan made to
---------------
Borrower by a Lender in accordance with its Pro Rata Share pursuant to Section
-------
2.01(a).
-------
"Revolving Termination Date" means (a) April 17, 2001, or if such date is
--------------------------
not a Business Day, the immediately preceding Business Day, or (b) such earlier
date upon which the combined Commitments may be terminated in accordance with
the terms of this Agreement.
"Senior Indebtedness" means, with respect to any Person at any time, all
-------------------
Indebtedness of such Person other than Subordinated Debt.
-18-
"Shareholders' Equity" means, as of any date of determination for Borrower
--------------------
and its Subsidiaries on a consolidated basis, shareholders' equity as of that
date determined in accordance with GAAP.
"Solvent" means, as to any Person at any time, that (i) the fair value of
-------
the property of such Person is greater than the amount of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated for purposes of Section
101(31) of the Bankruptcy Code; (ii) the present fair saleable value of the
property of such Person is not less than the amount that will be required to pay
the probable liability of such Person on its debts as they become absolute and
matured; (iii) such Person is able to realize upon its property and pay its
debts and other liabilities (including disputed, contingent and unliquidated
liabilities) as they mature in the normal course of business; (iv) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature; and (v) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person's
property would constitute unreasonably small capital.
"Subordinated Debt" means the Convertible Subordinated Debentures and any
-----------------
other subordinated debt permitted by Section 7.01.
------------
"Subsidiary" of a Person means a corporation, partnership, joint venture,
----------
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned or controlled, directly, or indirectly
through one or more intermediaries, or both, by such Person. Unless otherwise
specified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of Borrower.
"Swap Contract" means (a) any and all rate swap transactions, basis swaps,
-------------
forward rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward bond or forward bond price or forward bond
index transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement, and
(b) any and all transactions of any kind, and the related confirmations, which
are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association,
Inc., or any other master agreement (any such master agreement, together with
any related schedules, as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, a "Master Agreement"), including any such
obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
----------------------
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and
-19-
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a) the
amount(s) determined as the xxxx-to-market value(s) for such Swap Contracts, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Swap Contracts (which may
include any Lender).
"Synthetic Lease Obligations" means all monetary obligations of a Person
---------------------------
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations
which do not appear on the balance sheet of such Person but which, upon the
insolvency or bankruptcy of such Person, would be characterized as secured debt
of such Person.
"Term Conversion" means a conversion by Borrower of all outstanding
---------------
Revolving Loans into Term Loans on the Revolving Termination Date pursuant to
Section 2.01(b).
---------------
"Term Conversion Request" means a written request of Borrower in
-----------------------
substantially the form of Exhibit E.
---------
"Term Loan" means a Base Rate Loan or an Offshore Rate Loan made to
---------
Borrower by a Lender in accordance with its Pro Rata Share pursuant to Section
-------
2.01(a) and converted into a Term Loan pursuant to Section 2.01(b).
------- ---------------
"Term Maturity Date" means (a) April 17, 2002, or (b) such earlier date as
------------------
the Term Loans may be declared due and payable under the terms of this
Agreement.
"3-Year Credit Agreement" has the meaning set forth in Section 2.06(b).
----------------------- ---------------
"Threshold Amount" means $10,000,000.
----------------
"to the best knowledge of" means, when modifying a representation, warranty
------------------------
or other statement of any Person, that the fact or situation described therein
is known by such Person (or, (i) in the case of Borrower, known by any
Responsible Officer or executive officer of Borrower or, (ii) in the case of any
other Person other than a natural Person, known by any executive officer of such
Person) making the representation, warranty or other statement, or with the
exercise of reasonable due diligence under the circumstances (in accordance with
the standard of what a reasonable Person in similar circumstances would have
done) would have been known by such Person (or, (i) in the case of Borrower,
would have been known by any Responsible Officer or executive officer of
Borrower or, (ii) in the case of any other Person other than a natural Person,
would have been known by any executive officer of such Person).
"type" of Loan means (a) a Base Rate Loan and (b) an Offshore Rate Loan.
----
"Unfunded Pension Liability" means the excess of a Pension Plan's benefit
--------------------------
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
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"Voluntary Redemption Event" means, in respect of any Indebtedness
--------------------------
consisting of bonds, debentures, senior or subordinated notes or other debt
securities, any redemption, prepayment or call for redemption or prepayment of
any or all of such Indebtedness at the election of the issuer and not in
connection with any breach by such issuer of any term or covenant contained in
any instrument, indenture or agreement evidencing such Indebtedness.
1.02 Use of Certain Terms.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
or thereto, unless otherwise defined therein.
(b) As used herein, unless the context requires otherwise, the masculine,
feminine and neuter genders and the singular and plural include one another.
(c) The words "herein" and "hereunder" and words of similar import when
used in any Loan Document shall refer to the Loan Documents as a whole and not
to any particular provision thereof. The term "including" is by way of example
and not limitation. References herein to a Section, subsection or clause shall,
unless the context otherwise requires, refer to the appropriate Section,
subsection or clause in this Agreement.
(d) The term "or" is disjunctive; the term "and" is conjunctive. The term
"shall" is mandatory; the term "may" is permissive.
1.03 Accounting Terms. All accounting terms not specifically or completely
defined in this Agreement shall be construed in conformity with, and all
financial data required to be submitted by this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, and applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
1.04 Rounding. Any financial ratios required to be maintained by Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than the
number of places by which such ratio is expressed in this Agreement and rounding
the result up or down to the nearest number (with a round-up if there is no
nearest number) to the number of places by which such ratio is expressed in this
Agreement.
1.05 Exhibits and Schedules. All exhibits and schedules to this Agreement,
either as originally existing or as the same may from time to time be
supplemented, modified or amended, are incorporated herein by this reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.06 References to Agreements and Laws. Unless otherwise expressly
provided herein, (a) references to agreements (including the Loan Documents) and
other contractual instruments shall include all amendments, restatements,
extensions, supplements and other modifications thereto (unless prohibited by
any Loan Document), and (b) references to any Law
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shall include all statutory and regulatory provisions consolidating, amending,
replacing, supplementing or interpreting such Law.
SECTION 2.
THE COMMITMENTS AND EXTENSIONS OF CREDIT
2.01 Loans.
(a) Subject to the terms and conditions set forth in this Agreement, each
Lender severally agrees to make, Convert and Continue Revolving Loans until the
Revolving Termination Date in such amounts as Borrower may from time to time
request; provided, however, that the (i) Outstanding Obligations of any Lender
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shall not at any time exceed such Lender's Commitment, and (ii) the Outstanding
Obligations of all Lenders shall not exceed the combined Commitments at any
time. This is a revolving credit and, subject to the foregoing and the other
terms and conditions hereof, Borrower may borrow, Convert, Continue, prepay and
reborrow Revolving Loans as set forth herein without premium or penalty.
(b) Subject to the other terms and provisions hereof, on a one-time basis,
on the Revolving Termination Date, as specified by Borrower in a Term Conversion
Request, Borrower may elect to convert all, and not less than all, Revolving
Loans on such date into Term Loans. Upon any such conversion, all outstanding
Revolving Loans shall become Term Loans outstanding hereunder. Borrower shall
not be entitled to receive any other Term Loans, apart from those so converted
on the Revolving Termination Date. Any Term Loans prepaid may not be reborrowed.
Term Loans may be Converted, Continued, and prepaid as set forth herein.
(c) Loans made by each Lender shall be evidenced by one or more Notes. The
date, amount and maturity of each Lender's Loans and payments and other
particulars with respect thereto may be endorsed on schedule(s) attached to its
Note by each Lender and/or recorded on one or more loan accounts or records
maintained by such Lender in the ordinary course of business. Such Notes, loan
accounts and records shall be conclusive absent manifest error of the amount of
such Loans and payments thereon. Any failure so to record or any error in doing
so shall not, however, limit or otherwise affect the obligation of Borrower to
pay any amount owing with respect to the Loans.
2.02 Borrowings, Conversions and Continuations of Loans.
(a) Borrower may irrevocably request (i)(A) a Borrowing, Conversion or
Continuation of Revolving Loans, or (B) a Conversion or Continuation of Term
Loans, in a Minimum Amount therefor, by delivering the applicable Request for
Extension of Credit therefor, or (ii) a Term Conversion of Revolving Loans by
delivering the applicable Term Conversion Request therefor; in each case, by
Requisite Notice to Administrative Agent not later than the Requisite Time
therefor. All Borrowings, Conversions and Continuations of Loans shall
constitute Base Rate Loans unless properly and timely otherwise designated as
set forth in the prior sentence. Revolving Loans subject to a Term Conversion
shall remain Base Rate or Offshore Rate Loans, as in existence immediately prior
to such Term Conversion, subject to Conversion in accordance with the terms
hereof.
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(b) Following receipt of a Request for Extension of Credit, Administrative
Agent shall promptly notify each Lender of its Pro Rata Share thereof by
Requisite Notice. In the case of a Borrowing of Loans, each Lender shall make
the funds for its Loan available to Administrative Agent at Administrative
Agent's Office not later than the Requisite Time therefor on the Business Day
specified in such Request for Extension of Credit. Upon satisfaction of the
applicable conditions set forth in Section 4.02 (and, if the initial Extension
------------
of Credit hereunder, Section 4.01), all funds so received shall be made
------------
available to Borrower in like funds received. Administrative Agent shall
promptly notify Borrower and Lenders of the interest rate applicable to any Loan
other than a Base Rate Loan upon determination of same.
(c) Except as otherwise provided herein, an Offshore Rate Loan may be
Continued or Converted only on the last day of the Interest Period for such
Offshore Rate Loan. During the existence of a Default or Event of Default, no
Loans may be requested as, Converted into or Continued as Offshore Rate Loans
without the consent of Requisite Lenders, and Requisite Lenders may demand that
any or all of the then outstanding Offshore Rate Loans be Converted immediately
into Base Rate Loans.
(d) If a Loan is to be made on the same date that another Loan is due and
payable, Borrower or Lenders, as the case may be, shall, unless Administrative
Agent otherwise requests, make available to Administrative Agent the net amount
of funds giving effect to both such Loans and the effect for purposes of this
Agreement shall be the same as if separate transfers of funds had been made with
respect to each such Loan.
(e) The failure of any Lender to make any Loan on any date shall not
relieve any other Lender of any obligation to make a Loan on such date, but no
Lender shall be responsible for the failure of any other Lender to so make its
Loan.
2.03 Prepayments.
(a) Upon Requisite Notice to Administrative Agent not later than the
Requisite Time therefor, Borrower may at any time and from time to time
voluntarily prepay Loans in part in the Minimum Amount therefor or in full
without premium or penalty. Administrative Agent will promptly notify each
Lender thereof and of such Lender's Pro Rata Share of such prepayment. Any
prepayment of an Offshore Rate Loan shall be accompanied by all accrued interest
thereon, together with the amounts set forth in Section 3.05.
------------
(b) If for any reason the Outstanding Obligations exceed the combined
Commitments as in effect or as reduced or because of any limitation set forth in
this Agreement or otherwise, Borrower shall immediately prepay Loans in an
aggregate amount equal to such excess.
2.04 Reduction or Termination of Commitments. Upon Requisite Notice to
Administrative Agent not later than the Requisite Time therefor, Borrower may at
any time and from time to time, without premium or penalty, permanently and
irrevocably reduce the Commitments in a Minimum Amount therefor to an amount not
less than the Outstanding Obligations consisting of Revolving Loans at such
time, or terminate the Commitments. Any such reduction or termination shall be
accompanied by payment of all accrued and unpaid commitment fees with respect to
the portion of the Commitments being reduced or terminated.
-23-
Administrative Agent shall promptly notify Lenders of any such request for
reduction or termination of the Commitments. Each Lender's Commitment shall be
reduced by an amount equal to such Lender's Pro Rata Share times the amount of
such reduction.
2.05 Principal and Interest.
(a) Except as otherwise provided hereunder, if not sooner paid, Borrower
agrees to pay the outstanding principal amount of each Revolving Loan on the
Revolving Termination Date, and of each Term Loan on the Term Maturity Date.
(b) Subject to subsection (c) below, and unless otherwise specified
herein, Borrower shall pay interest on the unpaid principal amount of each Loan
(before and after default, before and after maturity, before and after judgment,
and before and after the commencement of any proceeding under any Debtor Relief
Laws) from the date borrowed until paid in full (whether by acceleration or
otherwise) on each Applicable Payment Date at a rate per annum equal to the
interest rate determined in accordance with the definition of such type of Loan,
plus, to the extent applicable in each case, the Applicable Amount.
(c) Notwithstanding subsection (b) of this Section, while any Event of
Default exists or after acceleration, 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 Amount then in effect for
such Loans and, in the case of Obligations not subject to an Applicable Amount,
at a 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 after
acceleration, the principal amount of such Loan shall, during the continuation
of such Event of Default or after acceleration, bear interest at a rate per
annum equal to the Base Rate plus 2%.
2.06 Fees.
(a) Commitment Fee. Borrower shall pay to Administrative Agent for the
account of each Lender according to its Pro Rata Share, a commitment fee equal
to the Applicable Amount times the actual daily amount by which the combined
-----
Commitments exceed the Outstanding Obligations. The commitment fee shall accrue
from the Closing Date until the Revolving Termination Date and shall be payable
quarterly in arrears on each Applicable Payment Date. The commitment fee shall
be calculated quarterly in arrears, and if there is any change in the Applicable
Amount during any quarter, the actual daily amount shall be computed and
multiplied by the Applicable Amount separately for each period during such
quarter that such Applicable Amount was in effect. The commitment fee shall
accrue at all times, including at any time during which one or more conditions
in Section 4 are not met.
---------
(b) Utilization Fee. Borrower shall pay to Administrative Agent for the
account of each Lender pro rata according to its Pro Rata Share, a utilization
fee equal to the Applicable Amount times the actual daily amount of Outstanding
-----
Obligations. The utilization fee shall accrue from the Closing Date until the
Revolving Termination Date or, if there is a Term Conversion, until the earlier
of (x) the date all Term Loans hereunder are repaid or (y) the Term Maturity
Date, at
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all times that the Outstanding Obligations hereunder plus, if such agreement is
in effect, the "Outstanding Obligations" under and as defined in that Credit
Agreement (3-Year) dated as of April 19, 2000 among Borrower, Bank of America as
Administrative Agent, and the lenders party thereto (the "3-Year Credit
-------------
Agreement"), exceed 50% of the Utilization Fee Base Amount, and shall be payable
---------
quarterly in arrears on each Applicable Payment Date. For purposes hereof, the
"Utilization Fee Base Amount" means, at any time of determination: (i) if at
---------------------------
such time the "Commitments" under and as defined in the 3-Year Credit Agreement
(the "3-Year Commitments") have been terminated, (A) for all times prior to the
------------------
Revolving Termination Date, the amount of the combined Commitments, and (B) for
all times after the Revolving Termination Date, infinity; and (ii) if at such
time the 3-Year Commitments have not been terminated, (A) for all times prior to
the Revolving Termination Date, the sum of the combined Commitments plus the 3-
Year Commitments at such time, and (B) for all times after the Revolving
Termination Date, provided there are outstanding Term Loans hereunder at such
time, the sum of (I) the outstanding principal amount of Term Loans hereunder at
such time plus (II) the amount of 3-Year Commitments at such time. The
utilization fee shall be calculated quarterly in arrears, and if there is any
change in the Applicable Amount during any quarter, the actual daily amount
shall be computed and multiplied by the Applicable Amount separately for each
period during such quarter that such Applicable Amount was in effect.
(c) Agency and Arrangement Fees. Borrower shall pay to Administrative
Agent and Arranger an agency fee and arrangement fee, respectively, in such
amounts and at such times as set forth in a separate letter agreement among
Borrower, Administrative Agent and Arranger. Such fees are for the services to
be performed by Administrative Agent in acting as Administrative Agent and for
the services of Arranger in arranging the credit facilities under this
Agreement, respectively, and are fully earned on the date paid. Such fees are
solely for Administrative Agent's and Arranger's own account and are
nonrefundable.
(d) Lenders' Upfront Fee. On the Closing Date, Borrower shall pay to
Administrative Agent for the account of each Lender an upfront fee in an amount
agreed between Administrative Agent and Borrower, calculated based on each
Lender's Commitment and allocated by Administrative Agent. Such upfront fees are
for the credit facilities committed by each Lender under this Agreement and are
fully earned on the date paid. The upfront fee paid to each Lender is solely for
its own account and is nonrefundable.
2.07 Computation of Interest and Fees. Computation of interest on Base
Rate Loans when the Base Rate is determined by Bank of America's "prime rate"
shall be calculated on the basis of a year of 365 or 366 days, as the case may
be, and the actual number of days elapsed. Computation of all other types of
interest and all fees shall be calculated on the basis of a year of 360 days and
the actual number of days elapsed, which results in a higher yield to Lenders
than a method based on a year of 365 or 366 days. Interest shall accrue on each
Loan for the day on which the Loan is made, and shall not accrue on a Loan, or
any portion thereof, for the day on which the Loan or such portion is paid,
provided that any Loan that is repaid on the same day on which it is made shall
--------
bear interest for one day.
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2.08 Making Payments.
(a) Except as otherwise provided herein, all payments by Borrower or any
Lender hereunder shall be made to Administrative Agent at Administrative Agent's
Office not later than the Requisite Time for such type of payment. All payments
received after such Requisite Time shall be deemed received on the next
succeeding Business Day. All payments shall be made in immediately available
funds in lawful money of the United States of America. All payments by Borrower
shall be made without condition or deduction for any counterclaim, defense,
recoupment or setoff.
(b) Upon satisfaction of any applicable terms and conditions set forth
herein, Administrative Agent shall promptly make any amounts received in
accordance with the prior subsection available in like funds as received, as
follows: (i) if payable to Borrower, by crediting the Designated Deposit
Account, and (ii) if payable to any Lender, by wire transfer to such Lender at
its Lending Office. If such conditions are not so satisfied, Administrative
Agent shall return any funds it is holding to the Lenders making such funds
available, without interest.
(c) Subject to the definition of "Interest Period," if any payment to be
made by Borrower shall come due on a day other than a Business Day, payment
shall instead be considered due on the next succeeding Business Day, and such
extension of time shall be reflected in computing interest and fees.
(d) Unless Borrower or any Lender has notified Administrative Agent prior
to the date any payment to be made by it is due, that it does not intend to
remit such payment, Administrative Agent may, in its sole and absolute
discretion, assume that Borrower or Lender, as the case may be, has timely
remitted such payment and may, in its sole and absolute discretion and in
reliance thereon, make available such payment to the Person entitled thereto. If
such payment was not in fact remitted to Administrative Agent in immediately
available funds, then:
(i) if Borrower failed to make such payment, each Lender shall
forthwith on demand repay to Administrative Agent the amount of such
assumed payment made available to such Lender, together with interest
thereon in respect of each day from and including the date such amount was
made available by Administrative Agent to such Lender to the date such
amount is repaid to Administrative Agent at the Federal Funds Rate; and
(ii) if any Lender failed to make such payment, Administrative
Agent shall be entitled to recover such corresponding amount on demand from
such Lender. If such Lender does not pay such corresponding amount forth-
with upon Administrative Agent's demand therefor, Administrative Agent
promptly shall notify Borrower, and Borrower shall pay such corresponding
amount to Administrative Agent. Administrative Agent also shall be entitled
to recover from such Lender interest on such corresponding amount in
respect of each day from the date such corresponding amount was made
available by Administrative Agent to Borrower to the date such
corresponding amount is recovered by Administrative Agent, (A) from such
Lender at a rate per annum equal to the daily Federal Funds Rate. and (B)
from Borrower, at a rate per annum equal to the interest rate applicable to
such Borrowing. Nothing herein shall be deemed to relieve any Lender
-26-
from its obligation to fulfill its Commitment or to prejudice any rights
which Administrative Agent or Borrower may have against any Lender as a
result of any default by such Lender hereunder.
(e) If Administrative Agent or any Lender is required at any time to
return to Borrower, or to a trustee, receiver, liquidator, custodian, or any
official under any proceeding under Debtor Relief Laws, any portion of a
payments made by Borrower, each Lender shall, on demand of Administrative Agent,
return it share of the amount to be returned, plus interest thereon from the
date of such demand to the date such payment is made at a rate per annum equal
to the daily Federal Funds Rate .
2.09 Funding Sources. Nothing in this Agreement shall be deemed to
obligate any Lender to obtain the funds for any Loan in any particular place or
manner or to constitute a representation by any Lender that it has obtained or
will obtain the funds for any Loan in any particular place or manner.
SECTION 3.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.
(a) Any and all payments by Borrower to or for the account of
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of
---------
Administrative Agent and each Lender, taxes imposed on or measured by its net
income, and franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the Laws of which
Administrative Agent or such Lender, as the case may be, is organized or
maintains a lending office (all such non-excluded taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and
liabilities being hereinafter referred to as "Taxes"). If Borrower shall be
-----
required by any Laws to deduct any Taxes from or in respect of any sum payable
under any Loan Document to Administrative Agent or any Lender, (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section), Administrative Agent and such Lender receives an amount equal to
the sum it would have received had no such deductions been made, (ii) Borrower
shall make such deductions, (iii) Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
Laws, and (iv) within 30 days after the date of such payment, Borrower shall
furnish to Administrative Agent (who shall forward the same to such Lender) the
original or a certified copy of a receipt evidencing payment thereof.
(b) In addition, Borrower agrees to pay any and all present or future
stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
-----------
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(c) If Borrower shall be required by the Laws of any jurisdiction outside
the United States to deduct any Taxes from or in respect of any sum payable
under any Loan Document to Administrative Agent or any Lender, Borrower shall
also pay to such Lender or Administrative Agent (for the account of such
Lender), at the time interest is paid, such additional amount that the
respective Lender specifies as necessary to preserve the after-tax yield (after
factoring in United States (federal and state) taxes imposed on or measured by
net income) such Lender would have received if such deductions (including
deductions applicable to additional sums payable under this Section) had not
been made.
(d) Borrower agrees to indemnify Administrative Agent and each Lender for
the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this Section)
paid by Administrative Agent and such Lender and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto.
3.02 Illegality. If any Lender determines that any Laws have made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Offshore Rate Loans, or materially restricts the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the applicable offshore
Dollar market, or to determine or charge interest rates based upon the Offshore
Rate, then, on notice thereof by Lender to Borrower through Administrative
Agent, any obligation of such Lender to make Offshore Rate Loans shall be
suspended until Lender notifies Administrative Agent and Borrower that the
circumstances giving rise to such determination no longer exist. Upon receipt of
such notice, Borrower shall, upon demand from such Lender (with a copy to
Administrative Agent), prepay or Convert all Offshore Rate Loans of such Lender,
either on the last day of the Interest Period thereof, if Lender may lawfully
continue to maintain such Offshore Rate Loans to such day, or immediately, if
Lender may not lawfully continue to maintain such Offshore Rate Loans. Each
Lender agrees to designate a different Lending Office if such designation will
avoid the need for such notice and will not, in the good faith judgment of such
Lender, otherwise be materially disadvantageous to such Lender.
3.03 Inability to Determine Rates. If, in connection with any Request for
Extension of Credit involving any Offshore Rate Loan, Administrative Agent
determines that (a) Dollar deposits are not being offered to banks in the
applicable offshore dollar market for the applicable amount and Interest Period
of the requested Offshore Rate Loan, (b) adequate and reasonable means do not
exist for determining the underlying interest rate for such Offshore Rate Loan,
or (c) such underlying interest rate does not adequately and fairly reflect the
cost to Lender of funding such Offshore Rate Loan, Administrative Agent will
promptly notify Borrower and all Lenders. Thereafter, the obligation of all
Lenders to make or maintain such Offshore Rate Loan shall be suspended until
Administrative Agent revokes such notice. Upon receipt of such notice, Borrower
may revoke any pending request for a Borrowing of Offshore Rate Loans or,
failing that, be deemed to have converted such request into a request for a
Borrowing of Base Rate Loans in the amount specified therein.
3.04 Increased Cost and Reduced Return; Capital Adequacy.
(a) If any Lender determines that any Laws:
-28-
(i) subject such Lender to any Tax, duty, or other charge with
respect to any Offshore Rate Loans or its obligation to make Offshore Rate
Loans, or change the basis on which taxes are imposed on any amounts
payable to such Lender under this Agreement in respect of any Offshore Rate
Loans;
(ii) shall impose or modify any reserve, special deposit, or
similar requirement (other than the reserve requirement utilized in the
determination of the Offshore Rate) relating to any extensions of credit or
other assets of, or any deposits with or other liabilities or commitments
of, such Lender (including its Commitment); or
(iii) shall impose on such Lender or on the offshore Dollar
interbank market any other condition affecting this Agreement or any of
such extensions of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Lender of
making, Converting into, Continuing, or maintaining any Offshore Rate Loans or
to reduce any sum received or receivable by such Lender under this Agreement
with respect to any Offshore Rate Loans, then from time to time upon demand of
Lender (with a copy of such demand to Administrative Agent), Borrower shall pay
to such Lender such additional amounts as will compensate such Lender for such
increased cost or reduction.
(b) If any Lender determines that any change in or the interpretation of
any Laws have the effect of reducing the rate of return on the capital of such
Lender or compliance by such Lender (or its Lending Office) or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy to Administrative Agent), Borrower shall pay to such
Lender such additional amounts as will compensate such Lender for such
reduction.
3.05 Breakfunding Costs. Upon demand of any Lender (with a copy to
Administrative Agent) from time to time, Borrower shall promptly compensate such
Lender for and hold such Lender harmless from any loss, cost or expense incurred
by it as a result of:
(a) any Continuation, Conversion, payment or prepayment of any Loan other
than a Base Rate Loan on a day other than the last day of the Interest Period
for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise); or
(b) any failure by Borrower (for a reason other than the failure of such
Lender to make a Loan) to prepay, borrow, Continue or Convert any Loan other
than a Base Rate Loan on the date or in the amount notified by Borrower;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
Borrower shall also pay any customary administrative fees charged by such Lender
in connection with the foregoing.
3.06 Matters Applicable to all Requests for Compensation.
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(a) A certificate of any Lender claiming compensation under this Section 3
---------
and setting forth the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of clearly demonstrable error. In determining
such amount, Lenders may use any reasonable averaging and attribution methods.
For purposes of this Section 3, a Lender shall be deemed to have funded each
---------
Offshore Rate Loan at the Offshore Base Rate used in determining the Offshore
Rate for such Loan by a matching deposit or other borrowing in the offshore
Dollar interbank market, whether or not such Offshore Rate Loan was in fact so
funded.
(b) Borrower shall not be obligated to pay any amount under this Section 3
---------
which arose prior to the date which is 180 days preceding the date of such
demand or is attributable to periods prior to the date which is 180 days
preceding the date of such demand.
(c) Upon any Lender making a claim for compensation under Section 3.01 or
------------
3.04, Borrower may remove and replace such Lender in accordance with Section
---- -------
10.22.
-----
3.07 Survival. All of Borrower's obligations under this Section 3 shall
---------
survive for a period of one year after the later of (i) termination of the
Commitments and (ii) payment in full of all Obligations.
SECTION 4.
CONDITIONS PRECEDENT TO EXTENSIONS OF CREDIT
4.01 Conditions of Initial Extension of Credit. The obligation of each
Lender to make its initial Extension of Credit hereunder is subject to
satisfaction of the following conditions precedent:
(a) Unless waived by all Lenders (or by Administrative Agent with respect
to immaterial matters or items specified in subsections (v) or (vi) below with
respect to which Borrower has given assurances satisfactory to Administrative
Agent that they will be delivered promptly following the Closing Date),
Administrative Agent's receipt of the following, each of which shall be
originals or facsimiles (followed promptly by originals) unless otherwise
specified, each properly executed by a Responsible Officer of Borrower, each
dated on, or in the case of third-party certificates, recently before the
Closing Date and each in form and substance satisfactory to Administrative
Agent, Lenders and their legal counsel:
(i) executed counterparts of this Agreement, sufficient in
number for distribution to Administrative Agent, Lenders and Borrower;
(ii) Notes executed by Borrower in favor of each Lender, each in
a principal amount equal to such Lender's Commitment;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible Officers
of Borrower as Administrative Agent and any Lender may require to establish
the identities of and verify the authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer thereof;
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(iv) such evidence as Administrative Agent and any Lender may
reasonably require to verify that Borrower is duly organized or formed,
validly existing, in good standing and qualified to engage in business in
each jurisdiction in which it is required to be qualified to engage in
business, including certified copies of Borrower's Organization Documents,
certificates of good standing and/or qualification to engage in business,
tax clearance certificates, and the like;
(v) a certificate signed by a Responsible Officer of Borrower
certifying (A) that the representations and warranties made by Borrower
herein, or which are contained in any certificate, document or financial or
other statement furnished at any time under or in connection herewith or
therewith, are true and correct on and as of the Closing Date, (B) that
Borrower is in compliance with all the terms and provisions of the Loan
Documents to which it is a party, and no Default or Event of Default shall
have occurred and be continuing, and (C) that there has been no event or
circumstance since the date of the Audited Financial Statements which has a
Material Adverse Effect;
(vi) an opinion of counsel to Borrower in form and substance
satisfactory to Administrative Agent and the Lenders;
(vii) written evidence that the Existing Credit Agreement and
all commitments thereunder have been or concurrently herewith are being
terminated; and
(viii) such other assurances, certificates, documents, consents
or opinions as Administrative Agent or Requisite Lenders reasonably may
require.
(b) Any fees required to be paid on or before the Closing Date shall have
been paid.
(c) Unless waived by Administrative Agent, Borrower shall have paid all
Attorney Costs of Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of Attorney Costs as shall constitute
its reasonable estimate of Attorney Costs incurred or to be incurred by it
through the closing proceedings (provided that such estimate shall not
--------
thereafter preclude final settling of accounts between Borrower and
Administrative Agent).
4.02 Conditions to all Extensions of Credit. In addition to any applicable
conditions precedent set forth elsewhere in this Section 4 or in Section 2, the
--------- ---------
obligation of each Lender to honor any Request for Extension of Credit other
than a Conversion or Continuation is subject to the following conditions
precedent:
(a) the representations and warranties of Borrower contained in Section 5,
---------
or which are contained in any certificate, document or financial or other
statement furnished at any time under or in connection herewith or therewith,
shall be correct on and as of the date of such Extension of Credit, except to
the extent that such representations and warranties specifically refer to an
earlier date;
(b) no Default or Event of Default exists, or would result from such
proposed Extension of Credit;
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(c) Administrative Agent shall have timely received a Request for
Extension of Credit by Requisite Notice by the Requisite Time therefor; and
(d) Administrative Agent shall have received, in form and substance
satisfactory to it, such other assurances, certificates, documents or consents
related to the foregoing as Administrative Agent or Requisite Lenders reasonably
may require.
Each Request for Extension of Credit by Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a)
----------------
and (b) have been satisfied on and as of the date of such Extension of Credit.
---
SECTION 5.
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Administrative Agent and Lenders that:
5.01 Existence and Qualification; Power; Compliance with Laws. Borrower is
a corporation duly organized or formed, validly existing and in good standing
under the Laws of the state of its incorporation or organization, has the power
and authority and the legal right to own and operate its properties, to lease
the properties it operates and to conduct its business, is duly qualified and in
good standing under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such
qualification, and is in compliance with all Laws except to the extent that
noncompliance could not be reasonably expected to have a Material Adverse
Effect.
5.02 Power; Authorization; Enforceable Obligations. Borrower has the power
and authority and the legal right to make, deliver and perform each Loan
Document to which it is a party and Borrower has power and authority to borrow
hereunder and has taken all necessary action to authorize the borrowings on the
terms and conditions of this Agreement and to authorize the execution, delivery
and performance of this Agreement and the other Loan Documents to which it is a
party. No consent or authorization of, filing with, or other act by or in
respect of any Governmental Authority, is required in connection with the
borrowings hereunder or with the execution, delivery, performance, validity or
enforceability of this Agreement or any of the other Loan Documents. The Loan
Documents have been duly executed and delivered by Borrower, and constitute a
legal, valid and binding obligation of Borrower, enforceable against Borrower in
accordance with their respective terms.
5.03 No Legal Bar. The execution, delivery, and performance by Borrower of
the Loan Documents to which it is a party and compliance with the provisions
thereof have been duly authorized by all requisite action on the part of
Borrower and do not and will not (a) violate or conflict with, or result in a
breach of, or require any consent under (i) any Organization Documents of
Borrower or any of its Subsidiaries, (ii) any material applicable Laws, rules,
or regulations or any order, writ, injunction, or decree of any Governmental
Authority or arbitrator, or (iii) any material Contractual Obligation of
Borrower or any of its Subsidiaries or by which any of them or any of their
property is bound or subject, (b) constitute a default under any such
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material agreement or instrument, or (c) result in, or require, the creation or
imposition of any Lien on any of the properties of Borrower or any of its
Subsidiaries.
5.04 Financial Statements; No Material Adverse Effect.
(a) The Audited Financial Statements (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 Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of Borrower and its Subsidiaries as of the date thereof,
including liabilities for taxes, material commitments and Indebtedness in
accordance with GAAP consistently applied throughout the period covered thereby.
(b) Since the date of the Audited Financial Statements, there has been no
event or circumstance which has a Material Adverse Effect.
5.05 Litigation. No litigation, investigation or proceeding of or before
an arbitrator or Governmental Authority is pending or, to the knowledge of
Borrower after due and diligent investigation, threatened by or against Borrower
or any of its Subsidiaries or against any of their properties or revenues which
could reasonably be expected to have a Material Adverse Effect.
5.06 No Default. Neither Borrower nor any its Subsidiaries are in default
under or with respect to any Contractual Obligation which could reasonably be
expected to have a Material Adverse Effect, and no Default or Event of Default
has occurred and is continuing or will result from the consummation of this
Agreement or any of the other Loan Documents, or the making of the Extensions of
Credit hereunder.
5.07 Ownership of Property; Liens. Borrower and its Subsidiaries have
valid fee or leasehold interests in all real property which they use in their
respective businesses, and Borrower and its respective Subsidiaries have good
and marketable title to all their other property, and none of such property is
subject to any Lien, except as permitted in Section 7.02.
------------
5.08 Taxes. Borrower and its Subsidiaries have filed all material tax
returns which are required to be filed, and have paid, or made provision for the
payment of, all taxes with respect to the periods, property or transactions
covered by said returns, or pursuant to any assessment received by Borrower or
its respective Subsidiaries, except (a) such taxes, if any, as are being
------
contested in good faith by appropriate proceedings and as to which adequate
reserves have been established and maintained, and (b) immaterial taxes;
provided, however, that in each case no material item or portion of property of
-------- -------
Borrower or any of its Subsidiaries is in jeopardy of being seized, levied upon
or forfeited.
5.09 Margin Regulations; Investment Company Act; Public Utility Holding
Company Act.
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(a) Borrower is not engaged nor will it engage, principally or as one of
its important activities, in the business of extending credit for the purpose of
"purchasing" or "carrying" "margin stock" within the respective meanings of each
of the quoted terms under Regulation U of the Board of Governors of the Federal
Reserve System as now and from time to time hereafter in effect. No part of the
proceeds of any Extensions of Credit hereunder will be used for "purchasing" or
"carrying" "margin stock" as so defined or for any purpose which violates, or
which would be inconsistent with, the provisions of Regulations U or X of such
Board of Governors.
(b) Neither Borrower nor any of its Subsidiaries (i) is a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding company," within
the meaning of the Public Utility Holding Company Act of 1935, or (ii) is or is
required to be registered as an "investment company" under the Investment
Company Act of 1940.
5.10 ERISA Compliance.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the best
knowledge of Borrower, nothing has occurred which would prevent, or cause the
loss of, such qualification. Borrower and each ERISA Affiliate have made all
required contributions to each Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has or could reasonably be
expected to have a Material Adverse Effect.
(b) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither 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
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 Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Borrower nor
any ERISA Affiliate has engaged in a transaction that could be subject to
Sections 4069 or 4212(c) of ERISA.
5.11 Intangible Assets. Borrower and its Subsidiaries own, or possess the
right to use, all trademarks, trade names, copyrights, patents, patent rights,
franchises, licenses and other intangible assets that are used in the conduct of
their respective businesses as now operated or could obtain such right without
causing a Material Adverse Effect, and none of such items, to the best knowledge
of Borrower, conflicts with the valid trademark, trade name, copyright, patent,
patent right or intangible asset of any other Person to the extent that such
conflict has or could reasonably be expected to have a Material Adverse Effect.
5.12 Compliance With Laws. Borrower and its Subsidiaries are in compliance
in all material respects with all material Laws that are applicable to it.
5.13 Environmental Compliance. Borrower and its Subsidiaries conduct in
the ordinary course of business a review of the effect of existing Environmental
Laws and claims alleging potential liability or responsibility for violation of
any Environmental Law on their respective businesses, operations and properties,
and as a result thereof Borrower has reasonably concluded that such
Environmental Laws and claims do not, individually or in the aggregate, have a
Material Adverse Effect.
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5.12 Compliance With Laws. Borrower and its Subsidiaries are in compliance
in all material respects with all material Laws that are applicable to it.
5.13 Environmental Compliance. Borrower and its Subsidiaries conduct in
the ordinary course of business a review of the effect of existing Environmental
Laws and claims alleging potential liability or responsibility for violation of
any Environmental Law on their respective businesses, operations and properties,
and as a result thereof Borrower has reasonably concluded that such
Environmental Laws and claims do not, individually or in the aggregate, have a
Material Adverse Effect.
5.14 Insurance. The properties of Borrower and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of 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 Borrower or such Subsidiary operates.
5.15 Swap Obligations. Neither Borrower nor any of its Subsidiaries has
incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. Borrower has undertaken its own independent
assessment of its consolidated assets, liabilities and commitments and has
considered appropriate means of mitigating and managing risks associated with
such matters and has not relied on any swap counterparty or any Affiliate of any
swap counterparty in determining whether to enter into any Swap Contract.
5.16 Disclosure. No statement, information, report, representation, or
warranty made by Borrower in any Loan Document or furnished to Administrative
Agent or any Lender in connection with any Loan Document contains any untrue
statement of a material fact or, when viewed together with Borrower's periodic
reports filed under the Securities and Exchange Act of 1934, omits to state any
material fact necessary to make the statements herein or therein not misleading.
SECTION 6.
AFFIRMATIVE COVENANTS
So long as any Obligation remains unpaid or unperformed, or any portion of
the Commitments remains outstanding, Borrower shall, and shall (except in the
case of Borrower's reporting covenants) cause each Subsidiary, to:
6.01 Financial Statements. Deliver to Administrative Agent and each
Lender, in form and detail satisfactory to Administrative Agent and Requisite
Lenders:
(a) as soon as available, but in any event within (i) 90 days after the end
of each fiscal year of Borrower or, (ii) if Borrower has been granted an
extension by the Securities and Exchange Commission permitting the late filing
by Borrower of any annual report on form 10-K, the earlier of (x) 120 days after
the end of each fiscal year of Borrower or (y) the last day of any such
extension, a consolidated balance sheet of Borrower and its Subsidiaries as at
the end of
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such fiscal year, and the related consolidated statements of income and cash
flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail, audited and
accompanied by a report and opinion of an independent certified public
accountant of nationally recognized standing, which report and opinion shall be
prepared in accordance with GAAP and shall not be subject to any qualifications
or exceptions as to the scope of the audit nor to any qualifications and
exceptions not reasonably acceptable to Requisite Lenders;
(b) as soon as available, but in any event within (i) 45 days after the end
of each of the first three fiscal quarters of each fiscal year of Borrower or,
(ii) if Borrower has been granted an extension by the Securities and Exchange
Commission permitting the late filing by Borrower of any quarterly report on
form 10-Q, the earlier of (x) 60 days after the end of each of the first three
fiscal quarters of each fiscal year of Borrower or (y) the last day of any such
extension, a consolidated balance sheet of Borrower and its Subsidiaries as at
the end of such fiscal quarter, and the related consolidated statements of
income and cash flows for such fiscal quarter and for the portion of Borrower's
fiscal year then ended, setting forth in each case in comparative form the
figures for the corresponding fiscal quarter of the previous fiscal year and the
corresponding portion of the previous fiscal year, all in reasonable detail and
certified by a Responsible Officer of Borrower as fairly presenting the
financial condition, results of operations and cash flows of Borrower and its
Subsidiaries in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes; and
(c) Reports required to be delivered pursuant to clauses (a) and (b) of
this Section 6.01 shall be deemed to have been delivered on the date on which
------------
Borrower posts such reports on Borrower's website on the Internet at the website
address listed on Schedule 10.02 hereof or when such report is posted on the
--------------
Securities and Exchange Commission's website at xxx.xxx.xxx.; provided that (x)
--------
Borrower shall deliver paper copies of the reports referred to in such clauses
(a) and (b) of this Section 6.01 to Administrative Agent or any Lender who
------------
requests Borrower to deliver such paper copies until written request to cease
delivering paper copies is given by Administrative Agent or such Lender, (y)
Borrower shall notify Administrative Agent and Lenders of the posting of any
such new material, and (z) in every instance Borrower shall provide paper copies
of the Compliance Certificates required by clause (a) of Section 6.02 to
------------
Administrative Agent and each Lender. Except for the Compliance Certificates
referred to in such clause (a) of Section 6.02, Administrative Agent shall have
------------
no obligation to request the delivery or to maintain copies of the reports
referred to in clauses (a) and (b) of this Section 6.01, and in any event shall
------------
have no responsibility to monitor compliance by Borrower with any such request
for delivery, and each Lender shall be solely responsible for requesting
delivery to it or maintaining its copies of such reports.
6.02 Certificates, Notices and Other Information. Deliver to
Administrative Agent and each Lender, in form and detail satisfactory to
Administrative Agent and Requisite Lenders:
(a) concurrently with the delivery of the financial statements referred to
in Sections 6.01(a) and (b), a duly completed Compliance Certificate signed by a
---------------- ---
Responsible Officer of Borrower;
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(b) promptly after the same are available, copies of each annual report,
proxy or financial statement or other report or communication sent to the
stockholders of Borrower, and copies of all annual, regular, periodic and
special reports and registration statements which Borrower may file or be
required to file with the Securities and Exchange Commission under Sections 13
or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to
be delivered to Administrative Agent pursuant hereto;
(c) promptly after the occurrence thereof, notice of any Default or Event
of Default;
(d) notice of any change in accounting policies or financial reporting
practices by Borrower or any Subsidiary that is material to Borrower or to
Borrower and its Subsidiaries on a consolidated basis;
(e) promptly after the commencement thereof, notice of any litigation,
investigation or proceeding affecting Borrower where the reasonably expected
damages to Borrower exceed the Threshold Amount, or in which injunctive relief
or similar relief is sought, which relief, if granted, has a Material Adverse
Effect;
(f) promptly after the occurrence thereof, notice of any Reportable Event
with respect to any Plan or the intent to terminate any Plan, or the institution
of proceedings or the taking or expected taking of any other action to terminate
any Plan or withdraw from any Plan;
(g) promptly after the occurrence thereof, notice of any Material Adverse
Effect; and
(h) promptly, such other data and information as from time to time may be
reasonably requested by Administrative Agent, or, through Administrative Agent
or any Lender. Notwithstanding any provision of this Agreement to the contrary,
so long as no Default or Event of Default shall have occurred and be continuing,
neither Borrower nor any of its Subsidiaries shall be required to disclose,
permit the inspection, examination, photocopying or making extracts of, or
discuss, any document, information or other matter that (i) constitutes non-
financial trade secrets or non-financial proprietary information or (ii) the
disclosure of which to any Lender, or their designated representative, is then
prohibited by law or any agreement binding on Borrower or any of its
Subsidiaries that was not entered into by Borrower or any such Subsidiary for
the purpose of concealing information from the Lenders.
Each notice pursuant to this Section shall be accompanied by a statement of
a Responsible Officer of Borrower setting forth details of the occurrence
referred to therein and stating what action Borrower has taken and proposes to
take with respect thereto.
6.03 Payment of Taxes. Pay and discharge when due all material taxes,
assessments, and governmental charges, except for any such tax, assessment,
charge, or levy which is an Ordinary Course Lien under subsection (b) of the
definition of such term.
6.04 Preservation of Existence. Preserve and maintain its existence,
licenses, permits, rights, franchises and privileges necessary or desirable in
the normal conduct of its business, except (i) as permitted by Section 7.03 or
------------
(ii) where failure to do so does not have a Material Adverse Effect.
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6.05 Maintenance of Properties. Maintain, preserve and protect all of its
material properties and equipment necessary in the operation of its business in
good order and condition, subject to wear and tear in the ordinary course of
business, and not permit any waste of its properties, except where failure to do
so would not reasonably be expected to have a Material Adverse Effect.
6.06 Maintenance of Insurance. Maintain liability and casualty insurance
with responsible insurance companies satisfactory to Lender in such amounts and
against such risks as is customary for similarly situated businesses.
6.07 Compliance With Laws.
(a) Comply with the requirements of all applicable Laws and orders of any
Governmental Authority, noncompliance with which has a Material Adverse Effect.
(b) Conduct its operations and keep and maintain its property in material
compliance with all Environmental Laws.
6.08 Inspection Rights. At any time during regular business hours and as
often as reasonably requested upon reasonable notice, permit Administrative
Agent or any Lender, or any employee, agent or representative thereof, to
examine, audit and make copies and abstracts from Borrower's records and books
of account and to visit and inspect its properties and to discuss its affairs,
finances and accounts with any of its officers and key employees, and, upon
request, furnish promptly to Administrative Agent or any Lender true copies of
all financial information and internal management reports made available to
their senior management.
6.09 Keeping of Records and Books of Account. Keep adequate records and
books of account reflecting all financial transactions in conformity with GAAP,
consistently applied, and in material conformity with all applicable
requirements of any Governmental Authority having regulatory jurisdiction over
Borrower or any applicable Subsidiary.
6.10 Compliance with ERISA. Cause, and cause each of its ERISA Affiliates
to: (a) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law; (b)
cause each Plan which is qualified under Section 401(a) of the Code to maintain
such qualification; and (c) make all required contributions to any Plan subject
to Section 412 of the Code.
6.11 Compliance With Agreements. Promptly and fully comply with all
Contractual Obligations to which any one or more of them is a party, except for
any such Contractual Obligations (a) the nonperformance of which would not cause
a Default or Event of Default, (b) then being contested by any of them in good
faith by appropriate proceedings, or (c) if the failure to comply therewith
could not reasonably be expected to have a Material Adverse Effect.
6.12 Use of Proceeds. Use the proceeds of Extensions of Credit for lawful
general corporate purposes including working capital and capital expenditures
not otherwise in contravention of this Agreement.
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SECTION 7.
NEGATIVE COVENANTS
So long as any Obligations remain unpaid or unperformed, or any portion of
the Commitments remains outstanding, Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:
7.01 Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except for the following ("Permitted Indebtedness"):
------ -----------------------
(a) Indebtedness outstanding on the date hereof and listed on Schedule 7.01
-------------
and any refinancings, refundings, renewals or extensions thereof, provided that
--------
the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to the
premium or other amount paid, and fees and expenses incurred, in connection with
such refinancing and by an amount equal to any utilized commitments thereunder;
(b) Ordinary Course Indebtedness;
(c) Indebtedness of Borrower under the Convertible Subordinated Debentures;
(d) Indebtedness of Borrower under any letter of credit facility (a
"Permitted LC Agreement"), provided that (i) the only credit extended to
---------------------- --------
Borrower pursuant to any Permitted LC Agreement consists of letters of credit
issued for the benefit of MKE or its affiliates to secure obligations owed by
Borrower to the beneficiaries for the purchase price of inventory; (ii) the sum
at any time of the aggregate face amount of all letters of credit issued and
outstanding under all Permitted LC Agreements, plus the aggregate amount of all
----
unremedied drawings under such letters of credit, does not exceed $85,000,000;
and (iii) the Indebtedness of Borrower under any Permitted LC Agreement is at
all times either unsecured or secured by Liens permitted pursuant to Section
-------
7.02(d).
------
(e) Indebtedness of Borrower and its Subsidiaries under loans and Capital
Leases incurred by Borrower or any of its Subsidiaries to finance the
acquisition by such Person of real property, improvements, fixtures, equipment
or other fixed assets (together with attachments, ascensions, additions, "soft
costs" and proceeds thereof), provided that in each case, (i) such Indebtedness
--------
is incurred by such Person at the time of, or not later than 6 months after, the
acquisition by such Person of the property so financed and (ii) such
Indebtedness does not exceed the purchase price of the property so financed;
(f) Indebtedness of Borrower and any of its Subsidiaries under Synthetic
Lease Obligations;
(g) Indebtedness of Borrower and its Subsidiaries under initial or
successive refinancings, refundings, renewals or extensions of any Indebtedness
permitted by subsections (d), (e) and (f) above, provided that the amount of
--------
such Indebtedness is not increased at the time of such refinancing, refunding,
renewal or extension except by an amount equal to the premium or other amount
paid, and fees and expenses incurred, in connection with such refinancing;
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(h) Indebtedness of Borrower and its Subsidiaries in respect of any
Permitted Receivables Facility;
(i) Indebtedness of Borrower to any of Borrower's Subsidiaries,
Indebtedness of any of Borrower's Subsidiaries to Borrower or Indebtedness of
any of Borrower's Subsidiaries to any of Borrower's other Subsidiaries;
(j) Subordinated Indebtedness of Borrower to any Person, provided that (A)
--------
such Indebtedness contains subordination provisions no less favorable to
Administrative Agent and Lenders than those set forth in Schedule 7.13 or as
-------------
otherwise approved by Requisite Lenders and (B) the aggregate principal amount
of all Subordinated Debt of Borrower outstanding (including the Convertible
Subordinated Debentures) does not exceed $700,000,000 at any time; and
(k) Indebtedness not exceeding, in the aggregate at any time, 10% of the
total consolidated assets of Borrower and its Subsidiaries determined as of the
end of the most recent fiscal quarter.
7.02 Liens. Incur, assume or suffer to exist, any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, except
------
for the following ("Permitted Liens"):
---------------
(a) Liens existing on the date hereof and listed on Schedule 7.01 and any
-------------
renewals or extensions thereof, provided that the property covered thereby is
--------
not increased and any renewal or extension of the obligations secured or
benefited thereby is permitted by Section 7.01(a);
---------------
(b) Ordinary Course Liens;
(c) Liens securing Investments which constitute Permitted Investments under
Section 7.05(d);
---------------
(d) Liens on cash or cash equivalents securing reimbursement obligations of
Borrower under letters of credit in an aggregate amount of all such cash and
cash equivalents not to exceed $100,000,000;
(e) Liens in respect of any Permitted Receivables Facility;
(f) Liens on the property or assets of any corporation which becomes a
Subsidiary of Borrower after the date of this Agreement, provided that (i) such
--------
Liens exist at the time such corporation became a Subsidiary and (ii) such Liens
were not created in contemplation of such acquisition by Borrower;
(g) Rights of vendors or lessors under conditional sale agreements, Capital
Leases or other title retention agreements, provided that in each case, (i) such
--------
rights secure or otherwise relate to Permitted Indebtedness, (ii) such rights do
not extend to any property other than property acquired with the proceeds of
such Permitted Indebtedness (together with accessions, additions, replacements
and proceeds thereof) and (iii) such rights do not secure any Indebtedness other
than Permitted Indebtedness;
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(h) Liens securing Indebtedness and any related obligations of Borrower or
any of its Subsidiaries which constitutes Permitted Indebtedness under Section
-------
7.01(f) (or refinancings of such Indebtedness under Section 7.01(g)), provided
------- --------------- --------
that such Liens cover only those assets subject to Synthetic Lease Obligations
(together with accessions, additions, replacements and proceeds thereof);
(i) Liens incurred in connection with leases, subleases, licenses and
sublicenses granted to Persons not interfering in any material respect with the
business of Borrower and its Subsidiaries and any interest or title of a lessee
or licensee under any such leases, subleases, licenses or sublicenses;
(j) Liens in favor of the "Lenders" in connection with the "Letter of
Credit Cash Collateral Account" under and as such terms are defined in the 3-
Year Credit Agreement; and
(k) Liens not otherwise permitted hereunder on the property or assets of
Borrower and any of its Subsidiaries securing (i) borrowed money Indebtedness,
(ii) all obligations of Borrower arising other than in connection with any
securitization which are evidenced by bonds, debentures, notes or other similar
instruments, or (iii) Indebtedness consisting of letter of credit reimbursement
obligations (including pursuant to a Permitted LC Agreement), provided that, in
--------
each case, (x) the aggregate principal amount of all Indebtedness secured by
such Liens does not exceed at any time 10% of the total assets of Borrower and
its Subsidiaries determined as of the end of the fiscal quarter immediately
preceding the date of determination and (y) such Liens do not encumber current
assets of Borrower and its Subsidiaries in excess of $50,000,000.
7.03 Fundamental Changes. Merge or consolidate with or into any Person or
liquidate, wind-up or dissolve itself, or permit or suffer any liquidation or
dissolution or sell all or substantially all of its assets, except that:
------
(a) any Subsidiary may merge with (i) Borrower, provided that Borrower
--------
shall be the continuing or surviving corporation, (ii) any one or more
Subsidiaries, and (iii) any joint venture, partnership or other Person, so long
as such joint venture, partnership and other Person will, as a result of making
such merger and all other contemporaneous related transactions, become a
Subsidiary;
(b) any Subsidiary may sell all or substantially all of its assets (upon
voluntary liquidation or otherwise), to Borrower or to another Subsidiary;
(c) Borrower may merge into or consolidate with any other, provided that
--------
(i) Borrower is the surviving corporation and (ii) immediately after giving
effect to such merger or consolidation, no Default or Event of Default shall
have occurred and be continuing; and
(d) any Subsidiary may merge or consolidate with or into any other Person
or sell all or substantially all of its assets to the extent such transaction is
a Disposition otherwise permitted under Section 7.04 or an Investment otherwise
------------
permitted under Section 7.05 and immediately after giving effect to such merger
------------
or consolidation, no Default or Event of Default shall have occurred and be
continuing.
-41-
7.04 Dispositions. Make any Dispositions, except:
------
(a) Ordinary Course Dispositions;
(b) Dispositions permitted by Section 7.03;
------------
(c) Dispositions which constitute the making of or liquidation of Permitted
Investments;
(d) Dispositions of assets on commercially reasonable terms or accounts
receivables in connection with a Permitted Receivables Facility by Borrower and
its Subsidiaries (it being understood that any determination as to whether a
particular Disposition is on commercially reasonable terms shall take into
consideration any larger business transaction to which such particular
Disposition is related); and
(e) Dispositions not otherwise permitted hereunder not exceeding 20% of
Consolidated Tangible Net Worth for the four fiscal quarter period ending as of
the end of the fiscal quarter immediately preceding the date of determination.
7.05 Investments. Make any Investments, except for the following
------
("Permitted Investments"):
---------------------
(a) Investments existing on the date hereof;
(b) Ordinary Course Investments;
(c) Investments permitted by Section 7.01 or Section 7.03;
------------ ----
(d) Investments arising from rights received by Borrower and its
Subsidiaries upon the required payment of any permitted contingent obligations
of Borrower and its Subsidiaries;
(e) Investments in the nature of Acquisitions, provided that the aggregate
--------
amount of such Acquisitions in any period of four consecutive fiscal quarters
does not exceed 20% of Consolidated Tangible Net Worth as determined as of the
fiscal quarter immediately preceding the date of determination;
(f) Investments of Borrower and its Subsidiaries in Swap Contracts,
provided that all such arrangements are entered into in connection with bona
--------
fide hedging operations and not for speculation;
(g) Investments by Quantum Technology Ventures (or any other Subsidiary of
Borrower with the primary purpose of making venture investments) and other
Investments which Borrower's Board of Directors determines to be strategic for
Borrower in an aggregate cost basis, at any time invested for all such entities
and investments together, not to exceed the sum of (x) $150,000,000 and (y) the
aggregate gain or loss on such Investments previously made under this clause
(g); and
(h) Investments not otherwise permitted hereunder, provided that the
--------
aggregate amount of such other Investments made after the Closing Date (less any
return on any such Investments)
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does not exceed 20% of Consolidated Tangible Net Worth as determined as of the
fiscal quarter immediately preceding the date of determination.
7.06 Restricted Payments. Make any Restricted Payments, except as follows:
------
(a) Borrower may pay dividends or other distributions payable solely in
shares of capital stock of Borrower or any Subsidiary or payable by a Subsidiary
to Borrower or to another Subsidiary;
(b) Borrower may distribute rights pursuant to a shareholder rights plan or
redeem such rights, provided that such redemption is in accordance with the
--------
terms of such shareholder rights plan;
(c) Borrower may make Restricted Payments in connection with or pursuant to
any of its Employee Benefits Plans or in connection with the employment,
termination or compensation of its employees, officers or directors;
(d) Borrower may make Restricted Payments with the Net Proceeds received
from a substantially concurrent issuance of Equity Securities or capital stock
or with its Equity Securities or capital stock or Borrower may convert any
Equity Securities in accordance with their terms into other Equity Securities;
(e) Borrower may purchase Equity Securities pursuant to one or more stock
repurchase programs, provided that (i) no Default or Event of Default shall have
--------
occurred and be continuing and (ii) after giving effect to any such repurchases
Borrower shall be in compliance with Section 7.12; and
------------
(f) Any Subsidiary of Borrower may declare or pay any dividends in respect
of its Equity Securities or purchase or redeem shares of its Equity Securities
or make distributions to shareholders not otherwise permitted hereunder,
provided that the aggregate amount paid or distributed in any period of four
--------
consecutive quarters (excluding any amounts covered by subsection (b) above)
does not exceed 5% of Consolidated Tangible Net Worth as determined as of the
fiscal quarter immediately preceding the date of determination.
7.07 ERISA. At any time engage in a transaction which could be subject to
Sections 4069 or 4212(c) of ERISA, or permit any Pension Plan to (a) engage in
any non-exempt "prohibited transaction" (as defined in Section 4975 of the
Code); (b) fail to comply with ERISA or any other applicable Laws; or (c) incur
any material "accumulated funding deficiency" (as defined in Section 302 of
ERISA), which, with respect to each event listed above, has a Material Adverse
Effect.
7.08 Change in Nature of Business. Engage, either directly or indirectly
through Affiliates, in any line of business other than the digital storage
business, any other business incidental or reasonably related thereto, or any
businesses that are, as determined by the Board of Directors of Borrower,
appropriate extensions thereof.
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7.09 Transactions with Affiliates. Enter into any transaction of any kind
with any Affiliate (other than transactions among Borrower or any of its
Subsidiaries and any Subsidiary) of Borrower other than arm's-length
transactions with Affiliates that are otherwise permitted hereunder.
7.10 Use of Proceeds. Borrower shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the Loan proceeds, directly or indirectly,
(i) for any Acquisition unless the prior, effective written consent or approval
to such Acquisition of the board of directors or equivalent governing body of
the acquiree is obtained, or (ii) to acquire any security in any transaction
that is subject to Section 13 (other than an Investment Transaction) or Section
14 of the Exchange Act, unless, prior to the time such transaction becomes
subject to such Section 13 or 14, the board of directors or other applicable
governing body of the Person that is the issuer of such securities has adopted a
resolution approving such transaction and approving any "change in control" with
respect to such Person whereby Borrower or such Subsidiary may acquire control
of such Person. For purposes of this Section 7.10, (x) an "Investment
------------ ----------
Transaction" means a transaction subject to Section 13(d), but not Section 16,
-----------
of the Exchange Act, provided that in connection with such transaction Borrower
or its Subsidiary (as the case may be) has reported and at all times continues
to report to the SEC that such transaction is undertaken for investment purposes
only and not for any of the purposes specified in clauses 4(a) through (j),
inclusive, of the special instructions for complying with Schedule 13D under the
Exchange Act, and (y) "change in control" means, for any Person, an Acquisition
with respect to such Person.
7.11 Certain Indebtedness Payments, Etc.. Neither Borrower nor any of its
Subsidiaries shall pay, prepay, redeem, purchase, defease or otherwise satisfy
in any manner prior to the scheduled payment thereof any Subordinated Debt
except as otherwise permitted under this Section 7.11; amend, modify or
------------
otherwise change the terms of any document, instrument or agreement evidencing
Subordinated Debt such that such amendment, modification or change would (i)
cause the outstanding aggregate principal amount of all such Subordinated Debt
so amended, modified or changed to be increased as a consequence of such
amendment, modification or change, (ii) cause the subordination provisions
applicable to such Subordinated Debt to be less favorable to Administrative
Agent and Lenders than those set forth on Schedule 7.13, (iii) increase the
-------------
interest rate applicable thereto or (iv) accelerate the scheduled payment
thereof, except that, subject to the other terms and provisions hereof, Borrower
may (a)(1) call for redemption of the entire outstanding amount of the
Convertible Subordinated Debentures and, (2) to the extent such Convertible
Subordinated Debentures are not converted prior to the redemption date, redeem
up to 30% of any such outstanding Convertible Subordinated Debentures less the
amount of Subordinated Debt purchased by Borrower pursuant to clause (b)(ii) of
this Section, provided that (A) no Default or Event of Default has occurred and
--------
is continuing or would result from such call for redemption or redemption and
(B) the closing price of the common stock shall have exceeded 120% of the then
applicable conversion price for 20 trading days within a period of 30
consecutive trading days ending within 5 trading days prior to the notice of
redemption. Borrower shall not cause or permit any of its obligations, except
the obligations constituting Senior Indebtedness to constitute "Designated
Senior Indebtedness" under the Indenture governing the Convertible Subordinated
Debentures (it being understood that the Obligations of Borrower under this
Agreement shall at all times constitute "Designated
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Senior Indebtedness"); (b)(i) pay, prepay, redeem, purchase, defease or
otherwise satisfy in any manner any Subordinated Debt, with the Net Proceeds
from the substantially contemporaneous issuance of Equity Securities by Borrower
or in exchange for Equity Securities of Borrower, and (ii) otherwise purchase
outstanding Subordinated Debt, provided that the aggregate value of all such
--------
Subordinated Debt repurchased, together with the amount of all redemptions
undertaken pursuant to clause (a) of this Section, does not at any time exceed
30% of the total amount of all Convertible Subordinated Debentures outstanding
as of the Closing Date; and (c) Borrower may convert, or honor a conversion
request with respect to, any such Subordinated Debt into Equity Securities of
Borrower in accordance with the terms of, and pay any cash to holders of such
Subordinated Debt in connection with, such a conversion solely to the extent
representing the value of any fractional shares.
7.12 Financial Covenants.
(a) Consolidated Tangible Net Worth. Permit Consolidated Tangible Net Worth
on the last day of any fiscal quarter (such date to be referred to herein as a
"determination date"), commencing with the fiscal quarter ended March 31, 2000,
to be less than the greater of (i) 75% of Consolidated Tangible Net Worth as of
March 31, 2000 or (ii) the sum of (A) an amount equal to 75% of Consolidated
Tangible Net Worth as of March 31, 2000; plus (B) an amount equal to 75% of the
----
sum of positive Consolidated Net Income (ignoring any quarterly losses) for each
fiscal quarter after the quarter ended March 31, 2000, through and including the
quarter ending on the determination date; plus (C) an amount equal to 75% of the
----
Net Proceeds of all Equity Securities issued by Borrower (excluding any issuance
where the Net Proceeds to the Borrower therefor are less than $10,000,000)
during the period commencing on March 31, 2000 and ending on the determination
date; plus (D) an amount equal to 75% of the increase in the value of
----
outstanding Equity Securities resulting, in accordance with GAAP, from any
conversion of Convertible Subordinated Debentures into such Equity Securities;
minus (E) the lesser of (x) the aggregate amount paid by Borrower to repurchase
-----
Equity Securities during the period commencing on March 31, 2000 and ending on
the determination date and (y) $200,000,000; and minus (F) the lesser of (x) the
-----
aggregate amount of charges taken by Borrower for In-Process Research &
Development associated with Acquisitions during the period commencing on March
31, 2000 and ending on the determination date, and (y) $100,000,000, provided
--------
that any such charges were taken by Borrower during the quarter in which any
such Acquisition was completed.
(b) Minimum Quick Ratio. Permit the Quick Ratio determined as of the last
day of any fiscal quarter of Borrower (commencing with the quarter ending March
31, 2000) to be less than 1.10:1.
(c) Maximum Leverage Ratio. Permit the Leverage Ratio, determined as of the
last day of any fiscal quarter of Borrower, commencing with the fiscal quarter
ending March 31, 2000 (measured on a rolling four quarter basis for the four
fiscal quarters ended), to be greater than 2.00:1.
(d) Minimum Profitability. Suffer or permit there to exist, as of the last
day of any fiscal quarter, for the four fiscal quarters ending on such date,
commencing with the fiscal quarter ending March 31, 2000, (i) any two fiscal
quarters in which the aggregate negative
-45-
Consolidated Net Income for such fiscal quarters exceeds 5% of Consolidated
Tangible Net Worth as of such date, or (ii) cumulative Consolidated Net Income
for such four-quarter period of less than $1.00. For purposes of calculating
this covenant, charges for In-Process Research & Development associated with
Acquisitions shall be excluded, provided that (x) any such charges are taken
--------
during the quarter in which any such Acquisitions are completed, and (y) the
aggregate amount of any such charges taken does not exceed $100,000,000 during
the term of this Agreement.
7.13 Accounting Changes. Change (i) its fiscal year (currently April 1 to
March 31) or (ii) its accounting practices except as permitted by GAAP.
SECTION 8.
EVENTS OF DEFAULT AND REMEDIES
8.01 Events of Default. Any one or more of the following events shall
constitute an Event of Default:
(a) Borrower fails to pay any principal on any Outstanding Obligation
(other than fees) as and on the date when due; or
(b) Borrower fails to pay any interest on any Outstanding Obligation or
any commitment fees due hereunder within three days after the date when due; or
fails to pay any other fees or amount payable to Administrative Agent or any
Lender under any Loan Document within five days after the date due; or
(c) Any default occurs in the observance or performance of any agreement
contained in Section 6.12 or 7; or
------------ -
(d) The occurrence of an Event of Default (as such term is or may
hereafter be specifically defined in any other Loan Document) under any other
Loan Document; or Borrower fails to perform or observe any other covenant or
agreement (not specified in subsections (a), (b) or (c) above) contained in any
Loan Document on its part to be performed or observed and such failure continues
for 30 days; or
(e) Any representation or warranty in any Loan Document proves to have
been incorrect in any material respect when made or deemed made; or
(f) (i) Borrower (x) defaults in any payment when due of principal of or
interest on any Indebtedness (other than Indebtedness hereunder) under any
Permitted LC Agreement or having an aggregate principal amount in excess of the
Threshold Amount, or (y) defaults in the observance or performance of any other
agreement or covenant relating to any Indebtedness (other than Indebtedness
hereunder) or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur, the effect of which default or
other event is to cause, or to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, (I) Indebtedness
under any Permitted LC Agreement or having an aggregate
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principal amount in excess of the Threshold Amount to become due (automatically
or otherwise) prior to its stated maturity, (II) if in respect of a Guaranty
Obligation, any Guaranty Obligation in excess of the Threshold Amount to become
payable or cash collateral in respect thereof to be demanded on account of such
default or other event, or, (III) if in respect of a Permitted LC Agreement,
cash collateral to be demanded or such agreement to be terminated on account of
such default or other event; (ii) Borrower is unable or admits in writing its
inability to pay its debts generally as they mature; or (iii) the occurrence
under any Swap Contract of an Early Termination Date (as defined in such Swap
Contract) resulting from (x) any event of default under such Swap Contract as to
which Borrower or any Subsidiary is the Defaulting Party (as defined in such
Swap Contract) or (y) any termination event under any Swap Contract (as defined
therein) as to which Borrower or any Subsidiary is an affected party (as so
defined) (other than termination events resulting solely from changes in the
value of Borrower's stock price or other rates, prices or indices underlying any
such Swap Contract), and as to which, in either event, the Swap Termination
Value owed by Borrower or such Subsidiary as a result thereof is greater than
the Threshold Amount; provided, however, that a Voluntary Redemption Event shall
-------- -------
not constitute an Event of Default under this Section 8.01(f); or
---------------
(g) Any Loan Document, at any time after its execution and delivery and
for any reason other than the agreement of all Lenders or satisfaction in full
of all the Obligations, ceases to be in full force and effect or is declared by
a court of competent jurisdiction to be null and void, invalid or unenforceable
in any respect; or Borrower denies that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate or rescind
any Loan Document; or
(h) (i) A final judgment against Borrower is entered for the payment of
money in excess of the Threshold Amount, or any non-monetary final judgment is
entered against Borrower which has a Material Adverse Effect and, in each case
if such judgment remains unsatisfied without procurement of a stay of execution
within 30 calendar days after the date of entry of judgment; or (ii) any writ or
warrant of attachment or execution or similar process is issued or levied
against all or any material part of the property of any such Person and is not
released, vacated or fully bonded (A) within 30 calendar days after its issue or
levy or (B) if earlier, five days prior to the date of any proposed sale.
(i) Borrower or any of its Material Subsidiaries institutes or consents to
the institution of any proceeding under Debtor Relief Laws, or makes an
assignment for the benefit of creditors; or applies for or consents to the
appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed without the application or consent
of that Person and the appointment continues undischarged or unstayed for 60
calendar days; or any proceeding under Debtor Relief Laws relating to any such
Person or to all or any part of its property is instituted without the consent
of that Person and continues undismissed or unstayed for 60 calendar days, or an
order for relief is entered in any such proceeding; or
(j) (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in
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excess of the Threshold Amount; (ii) the aggregate amount of Unfunded Pension
Liability among all Pension Plans at any time exceeds the Threshold Amount; or
(iii) Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of the Threshold Amount; or
(k) There occurs (i) any Change of Control, or (ii) any event relating to
a change in the corporate ownership, control or governance of Borrower or any
Subsidiary as issuer ("Issuer") of any notes, bonds, debentures, Subordinated
------
Debt or other debt securities, the result of which is to cause Indebtedness
evidenced by any such notes, bonds, debentures, Subordinated Debt or other debt
securities to be subject to mandatory redemption or repurchase by Issuer,
provided the outstanding amount of such outstanding Indebtedness exceeds the
--------
Threshold Amount.
8.02 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 Borrower (a "Charge"), and if solely by virtue of
------
such Charge, there would exist an Event of Default due to breach of Section 7.12
------------
as of such fiscal period end date, such Event of Default shall be deemed to
arise upon the earlier of (i) the date after such fiscal period end date on
which 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 (ii) the date Borrower
delivers to Administrative Agent its audited annual or unaudited quarterly
financial statements in respect of such fiscal period reflecting such Charge as
taken.
8.03 Remedies Upon Event of Default. Without limiting any other rights or
remedies of Administrative Agent or Lenders provided for elsewhere in this
Agreement, or the other Loan Documents, or by applicable Law, or in equity, or
otherwise:
(a) Upon the occurrence, and during the continuance, of any Event of
Default other than an Event of Default described in Section 8.01(i), Requisite
---- ---------------
Lenders may request Administrative Agent to, and Administrative Agent thereupon
shall, terminate the Commitments and/or declare all or any part of the unpaid
principal of all Loans, all interest accrued and unpaid thereon and all other
amounts payable under the Loan Documents to be immediately due and payable,
whereupon the same shall become and be immediately due and payable, without
protest, presentment, notice of dishonor, demand or further notice of any kind,
all of which are expressly waived by Borrower; and
(b) Upon the occurrence of any Event of Default described in Section
-------
8.01(i):
-------
(i) the Commitments and all other obligations of Administrative
Agent or Lenders shall automatically terminate without notice to or demand
upon Borrower, which are expressly waived by Borrower; and
(ii) the unpaid principal of all Loans, all interest accrued and
unpaid thereon and all other amounts payable under the Loan Documents shall
be immediately due and payable, without protest, presentment, notice of
dishonor, demand or further notice of any kind, all of which are expressly
waived by Borrower.
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(c) Upon the occurrence of any Event of Default, Lenders and
Administrative Agent, or any of them, without notice to (except as expressly
provided for in any Loan Document) or demand upon Borrower, which are expressly
waived by Borrower (except as to notices expressly provided for in any Loan
Document), may proceed to (but only with the consent of Requisite Lenders)
protect, exercise and enforce their rights and remedies under the Loan Documents
against Borrower and such other rights and remedies as are provided by Law or
equity.
(d) Except as permitted by Section 10.05, no Lender may exercise any
-------------
rights or remedies with respect to the Obligations without the consent of
Requisite Lenders in their sole and absolute discretion. The order and manner in
which Administrative Agent's and Lenders' rights and remedies are to be
exercised shall be determined by Requisite Lenders in their sole and absolute
discretion. Regardless of how a Lender may treat payments for the purpose of its
own accounting, for the purpose of computing the Obligations hereunder, payments
shall be applied first, to costs and expenses (including Attorney Costs)
incurred by Administrative Agent and each Lender, second, to the payment of
accrued and unpaid interest on the Loans to and including the date of such
application, third, to the payment of the unpaid principal of the Loans, and
fourth, to the payment of all other amounts (including fees) then owing to
Administrative Agent and Lenders under the Loan Documents, in each case paid pro
rata to each Lender in the same proportions that the aggregate Obligations owed
to each Lender under the Loan Documents bear to the aggregate Obligations owed
under the Loan Documents to all Lenders, without priority or preference among
Lenders. No application of payments will cure any Event of Default, or prevent
acceleration, or continued acceleration, of amounts payable under the Loan
Documents, or prevent the exercise, or continued exercise, of rights or remedies
of Administrative Agent and Lenders hereunder or thereunder or at Law or in
equity.
SECTION 9.
ADMINISTRATIVE AGENT
9.01 Appointment and Authorization of Administrative Agent. Each Lender
hereby irrevocably (subject to Section 9.09) appoints, designates and authorizes
------------
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document,
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall Administrative Agent have or be deemed to
have any fiduciary relationship with any Lender, 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
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" in this Agreement with reference to Administrative
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.
-49-
9.02 Delegation of Duties. Administrative 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. Administrative Agent shall not
be responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects with reasonable care.
9.03 Liability of Administrative Agent. No Administrative Agent-Related
Person 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 Lender for any
recital, statement, representation or warranty made by Borrower or any
Subsidiary or Affiliate of 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
Administrative 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
Borrower or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Administrative Agent-Related Person shall be under
any obligation to any Lender 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 Borrower or any of Borrower's Subsidiaries or Affiliates.
9.04 Reliance by Administrative Agent.
(a) Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, representation, 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 Borrower), independent accountants and other experts selected by
Administrative Agent. Administrative Agent shall be fully justified in failing
or refusing to take any action under any other Loan Document unless it shall
first receive such advice or concurrence of Requisite Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by Lenders against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action.
Administrative 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 Requisite Lenders or all Lenders, if
required hereunder, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of Lenders. Where this Agreement
expressly permits or prohibits an action unless Requisite Lenders otherwise
determine, and in all other instances, Administrative Agent may, but shall not
be required to, initiate any solicitation for the consent or a vote of Lenders.
(b) For purposes of determining compliance with the conditions specified in
Section 4.01, each Lender 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 by Administrative Agent to such Lender for consent,
approval, acceptance or satisfaction, or
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required thereunder to be consented to or approved by or acceptable or
satisfactory to such Lender.
(c) Each Lender hereby authorizes Administrative Agent, upon payment of the
amount certified by Borrower as the full and final payment of all principal,
interest, fees and other charges outstanding under this Agreement, and following
termination of the Commitments, to execute with and in favor of Borrower a
termination letter that, inter alia, terminates Borrower's obligation to observe
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any or all of the covenants in Sections 3, 6 and 7 hereof.
---------- - -
9.05 Notice of Default. Administrative 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 Administrative Agent for the account of Lenders, unless
Administrative Agent shall have received written notice from a Lender or
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". Administrative
Agent will notify Lenders of its receipt of any such notice. Administrative
Agent shall take such action with respect to such Default or Event of Default as
may be directed by Requisite Lenders in accordance with Section 8; provided,
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however, that unless and until Administrative Agent has received any such
-------
direction, Administrative 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 Lenders.
9.06 Credit Decision; Disclosure of Information by Administrative Agent.
Each Lender acknowledges that no Administrative Agent-Related Person has made
any representation or warranty to it, and that no act by Administrative Agent
hereinafter taken, including any consent to and acceptance of any assignment or
review of the affairs of Borrower and its Subsidiaries, shall be deemed to
constitute any representation or warranty by any Administrative Agent-Related
Person to any Lender as to any matter, including whether Administrative Agent-
Related Persons have disclosed material information in their possession. Each
Lender, including any Lender by assignment, represents to Administrative
Agent that it has, independently and without reliance upon any Administrative
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 Borrower and its Subsidiaries, and all applicable bank
regulatory laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to Borrower
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Administrative 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 Borrower. Except for notices, reports and other documents
expressly required to be furnished to Lenders by Administrative Agent herein,
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of
Borrower or any of its Subsidiaries which may come into the possession of any
Administrative Agent-Related Person.
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9.07 Indemnification of Administrative Agent. Whether or not the
transactions contemplated hereby are consummated, Lenders shall indemnify upon
demand each Administrative Agent-Related Person (to the extent not reimbursed by
or on behalf of Borrower and without limiting the obligation of Borrower to do
so), pro rata, and hold harmless each Administrative Agent-Related Person from
and against any and all Indemnified Liabilities incurred by it; provided,
--------
however, that no Lender shall be liable for the payment to any Administrative
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Agent-Related Person of any portion of such Indemnified Liabilities resulting
from such Person's gross negligence or willful misconduct; provided, however,
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that no action taken in accordance with the directions of Requisite Lenders
shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section. Without limitation of the foregoing, each Lender shall
reimburse Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by Administrative
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 Administrative Agent
is not reimbursed for such expenses by or on behalf of Borrower. The undertaking
in this Section shall survive the payment of all Obligations hereunder and the
resignation or replacement of Administrative Agent.
9.08 Administrative Agent in Individual Capacity. Bank of America and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with Borrower
and its Subsidiaries and Affiliates as though Bank of America were not
Administrative Agent hereunder and without notice to or consent of Lenders.
Lenders acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of Borrower or such Affiliate) and acknowledge that Administrative Agent
shall be under no obligation to provide such information to them. With respect
to its Loans, Bank of America shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
Administrative Agent.
9.09 Successor Administrative Agent. Administrative Agent may, and at the
request of Requisite Lenders shall, resign as Administrative Agent upon 30 days'
notice to Lenders. If Administrative Agent resigns under this Agreement,
Requisite Lenders shall appoint from among Lenders a successor administrative
agent for Lenders which successor administrative agent shall be approved by
Borrower. If no successor administrative agent is appointed prior to the
effective date of the resignation of Administrative Agent, Administrative Agent
may appoint, after consulting with Lenders and Borrower and upon approval of
Borrower (other than at any time as there exists an Event of Default) which will
not be unreasonably withheld, a successor administrative agent from among
Lenders. Upon the acceptance of its appointment as successor administrative
agent hereunder, such successor administrative agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agent and the term
"Administrative Agent" shall mean such successor administrative agent and the
retiring Administrative Agent's appointment, powers and duties as Administrative
Agent shall be terminated. After any retiring
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Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Section 9 and Sections 10.03 and 10.11 shall inure to its
--------- -------------- -----
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor administrative agent
has accepted appointment as Administrative Agent (whether due to absence of
Borrower approval or otherwise) by the date which is 30 days following a
retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and Lenders shall perform all of the duties of Administrative Agent hereunder
until such time, if any, as Requisite Lenders appoint a successor agent as
provided for above.
9.10 Syndication Agent; Documentation Agent.. None of Lenders (or
Affiliates of Lenders) identified on the facing page or signature pages of this
Agreement as a "Syndication Agent" or "Documentation Agent" shall have any
right, power, obligation, liability, responsibility or duty under this Agreement
in such capacity. Without limiting the foregoing, none of Lenders (or Affiliates
of Lenders) so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of Lenders (or Affiliates of Lenders) so identified in
deciding to enter into this Agreement or in taking or not taking action
hereunder.
SECTION 10.
MISCELLANEOUS
10.01 Amendments; Consents. No amendment, modification, supplement,
extension, termination or waiver of any provision of this Agreement or any other
Loan Document, no approval or consent thereunder, and no consent to any
departure by Borrower therefrom shall be effective unless in writing signed by
Requisite Lenders and acknowledged by Administrative Agent, and each such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given. Except as otherwise expressly provided herein, without
the approval in writing of Administrative Agent and all Lenders, no amendment,
modification, supplement, termination, waiver or consent may be effective:
(a) To reduce the amount of principal, principal prepayments or the rate of
interest payable on, any Loan, or the amount of any fee or other amount payable
to any Lender under the Loan Documents (unless such modification is consented to
by each Lender entitled to receive such fee ) or to waive an Event of Default
consisting of the failure of Borrower to pay when due principal, interest or any
commitment fee;
(b) To postpone any date fixed for any payment of principal of, prepayment
of principal of, or any installment of interest on, any Loan or any installment
of any commitment fee, to extend the term of, or increase the amount of, any
Lender's Commitment (it being understood that a waiver of an Event of Default
shall not constitute an extension or increase in the Commitment of any Lender)
or modify the Pro Rata Share of any Lender;
(c) To amend the definition of "Requisite Lenders" or the provisions of
Section 4, Section 9, this Section 10.01 or Section 10.06; or
--------- --------- ------------- -------------
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(d) To amend any provision of this Agreement that expressly requires the
consent or approval of all Lenders; provided, however, that (i) no amendment,
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waiver or consent shall, unless in writing and signed by Administrative Agent in
addition to Requisite Lenders or all Lenders, as the case may be, affect the
rights or duties of Administrative Agent, and (ii) the fee letters may be
amended, or rights or privileges thereunder waived, in a writing executed by the
parties thereto. Any amendment, modification, supplement, termination, waiver or
consent pursuant to this Section shall apply equally to, and shall be binding
upon, all Lenders and Administrative Agent.
10.02 Transmission and Effectiveness of Communications and Signatures.
(a) Modes of Delivery. Except as otherwise provided in any Loan Document,
notices, requests, demands, directions, agreements and documents delivered in
connection with the Loan Documents (collectively, "communications") shall be
--------------
transmitted by Requisite Notice to the number and address set forth on Schedule
--------
10.02, may be delivered by the following modes of delivery, and shall be
-----
effective as follows:
Mode of Delivery Effective on earlier of actual receipt and:
---------------- ------------------------------------------
Courier Scheduled delivery date
Facsimile When transmission in legible form complete
Mail Fourth Business Day after deposit in U.S. mail
first class postage pre-paid
Personal delivery When received
Telephone When conversation completed
provided, however, that communications delivered to Administrative Agent
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pursuant to Section 2 must be in writing and shall not be effective until
---------
actually received by Administrative Agent.
(b) Reliance by Administrative Agent and Lenders. Administrative Agent and
Lenders shall be entitled to rely and act on any communications purportedly
given by or on behalf of Borrower even if (i) such communications (A) were not
made in a manner specified herein, (B) were incomplete, or (C) were not preceded
or followed by any other notice specified herein, or (ii) the terms thereof, as
understood by the recipient, varied from any subsequent related communications
provided for herein. Borrower shall indemnify Administrative Agent and Lenders
from any loss, cost, expense or liability as a result of relying on any
communications permitted herein.
(c) Effectiveness of Facsimile Documents and Signatures. Documents and
agreements delivered from time to time in connection with the Loan Documents may
be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as hardcopies with manual signatures and shall be binding on all
Borrower Parties and Administrative Agent and Lenders. Administrative Agent may
also request that any such documents and signature be confirmed by a
manually-signed hardcopy thereof; provided, however, that the failure to request
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or deliver any such
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manually-signed hardcopy shall not affect the effectiveness of any facsimile
documents or signatures.
10.03 Attorney Costs, Expenses and Taxes. Borrower agrees (a) to pay or
reimburse Administrative Agent for all reasonable costs and expenses incurred in
connection with the development, preparation, negotiation and execution of the
Loan Documents, and the development, preparation, negotiation and execution of
any amendment, waiver, consent, supplement or modification to, any Loan
Documents, and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including all reasonable Attorney Costs, and (b) to pay or
reimburse Administrative Agent and each Lender for all costs and expenses
incurred in connection with any refinancing, restructuring, reorganization
(including a bankruptcy reorganization) and enforcement or attempted
enforcement, or preservation of any rights under any Loan Documents, and any
other documents prepared in connection herewith or therewith, or in connection
with any refinancing, or restructuring of any such documents in the nature of a
"workout" or of any insolvency or bankruptcy proceeding, including Attorney
Costs. The foregoing costs and expenses shall include all reasonable search,
filing, recording, title insurance and appraisal charges and fees and taxes
related thereto, and other out-of-pocket expenses incurred by Administrative
Agent and the cost of independent public accountants and other outside experts
retained by Administrative Agent or any Lender. Such costs and expenses shall
also include administrative costs of Administrative Agent reasonably
attributable to the administration of the Loan Documents. Any amount payable by
Borrower under this Section shall bear interest from the second Business Day
following the date of demand for payment at the Default Rate, unless waived by
Administrative Agent. The agreements in this Section shall survive repayment of
all Obligations.
10.04 Binding Effect; Assignment.
(a) This Agreement and the other Loan Documents to which Borrower is a
party will be binding upon and inure to the benefit of Borrower, Administrative
Agent, Lenders and their respective successors and assigns, except that,
Borrower may not assign its rights hereunder or thereunder or any interest
herein or therein without the prior written consent of all Lenders and any such
attempted assignment shall be void. Any Lender may at any time pledge its Note
or any other instrument evidencing its rights as a Lender under this Agreement
to a Federal Reserve Bank, but no such pledge shall release such Lender from its
obligations hereunder or grant to such Federal Reserve Bank the rights of a
Lender hereunder absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Lender may assign to
one or more Eligible Assignees all or any portion of its Commitment and/or
Extensions of Credit; provided that (i) such assignment, if not to a Lender or
--------
an Affiliate of the assigning Lender, shall be consented to by Borrower at all
times other than during the existence of a Default or Event of Default and by
Administrative Agent (which approval of Borrower shall not be unreasonably
withheld), (ii) a copy of a duly signed and completed Assignment and Acceptance
shall be delivered to Administrative Agent, (iii) except in the case of an
assignment (A) to an Affiliate of the assigning Lender or to another Lender or
(B) of the entire remaining Commitment of the assigning Lender, the portion of
the Commitment assigned shall not be less than the Minimum Amount therefor, and
(iv) the effective date of any such assignment shall be as specified in the
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Assignment and Acceptance, but not earlier than the date which is five Business
Days after the date Administrative Agent has received the Assignment and
Acceptance. Upon any required consent by Administrative Agent and Borrower to
such assignment and payment of the requisite fee described below, the assignee
named therein shall be a Lender for all purposes of this Agreement, with the Pro
Rata Share therein set forth and, to the extent of such Pro Rata Share, the
assigning Lender shall be released from its further obligations under this
Agreement. Borrower agrees that it shall execute and deliver upon request
(against delivery by the assigning Lender to Borrower of any Note) to such
assignee Lender, one or more Notes evidencing such assignee Lender's Loans, and
to the assigning Lender if requested, one or more Notes evidencing Loans under
any Commitment retained by the assigning Lender. Administrative Agent's consent
to any assignment shall not be deemed to constitute any representation or
warranty by any Administrative Agent-Related Person as to any matter. For
purposes hereof, each mutual fund that is an Affiliate of a Lender shall be
deemed to be a single Eligible Assignee, whether or not such fund is managed by
the same fund manager as other mutual funds that are Affiliates of the same
Lender.
(c) After receipt of a completed Assignment and Acceptance, and receipt of
an assignment fee of $4,000 from such Eligible Assignee (including in the case
of assignments to Affiliates of assigning Lenders), Administrative Agent shall,
promptly following the effective date thereof, provide to Borrower and Lenders a
revised Schedule 10.02 giving effect thereto.
--------------
(d) Each Lender may from time to time, without the consent of any other
Person, grant participations to one or more other Person (including another
Lender) of all or any portion of its Pro Rata Share of its Commitment or
Extensions of Credit; provided, however, that (i) such Lender's obligations
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under this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) the participating banks or other financial institutions shall
not be a Lender hereunder for any purpose except, if the participation agreement
so provides, for the purposes of Section 3 (but only to the extent that the cost
---------
of such benefits to Borrower does not exceed the cost which Borrower would have
incurred in respect of such Lender absent the participation) and subject to
Sections 10.05 and 10.06, (iv) Borrower, Administrative Agent and the other
-------------- -----
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement, (v)
the participation agreement shall not restrict an increase in the combined
Commitments or in granting Lender's Pro Rata Share, so long as the amount of the
participation interest is not affected thereby, and (vi) the consent of the
holder of such participation interest shall not be required for amendments or
waivers of provisions of the Loan Documents; provided, however, that the
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assigning Lender may, in any agreement with a participant, give such participant
the right to consent to any matter which (A) extends the Revolving Termination
Date or Term Maturity Date as to such participant or any other date upon which
any payment of money is due to such participant, (B) reduces the rate of
interest owing to such participant, any fee or any other monetary amount owing
to such participant, or (C) reduces the amount of any installment of principal
owing to such participant. Any Lender that sells a participation to any Person
that is a "foreign corporation, partnership or trust" within the meaning of the
Code shall include in its participation agreement with such Person a covenant by
such Person that such Person will comply with the provisions of Section 10.21 as
-------------
if such Person were a Lender and provide that Administrative Agent and Borrower
shall be third party beneficiaries of such covenant.
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10.05 Set-off. In addition to any rights and remedies of Administrative
Agent and Lenders or any assignee or participant of any Lender or any Affiliate
thereof (each, a "Proceeding Party") provided by law, upon the occurrence and
----------------
during the continuance of any Event of Default, each Proceeding Party is
authorized at any time and from time to time, without prior notice to Borrower,
any such notice being waived by Borrower to the fullest extent permitted by law,
to proceed directly, by right of set-off, banker's lien, or otherwise, against
any assets of Borrower Parties which may be in the hands of such Proceeding
Party (including all general or special, time or demand, provisional or other
deposits and other indebtedness owing by such Proceeding Party to or for the
credit or the account of Borrower) and apply such assets against the
Obligations, irrespective of whether such Proceeding Party shall have made any
demand therefor and although such Obligations may be unmatured. Each Lender
agrees promptly to notify Borrower and Administrative Agent after any such set-
off and application made by such Lender; provided, however, that the failure to
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give such notice shall not affect the validity of such set-off and application.
10.06 Sharing of Payments. Each Lender severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against Borrower or otherwise, receives payment on account of the Outstanding
Obligations held by it that is ratably more than any other Lender receives in
payment on account of the Outstanding Obligations held by such other Lender,
then, subject to applicable Laws: (a) the Lender exercising the right of setoff,
banker's lien or counterclaim or otherwise receiving such payment shall
purchase, and shall be deemed to have simultaneously purchased, from the other
Lender a participation in the Outstanding Obligations held by the other Lender
and shall pay to the other Lender a purchase price in an amount so that the
share of the Outstanding Obligations held by each Lender after the exercise of
the right of setoff, banker's lien or counterclaim or receipt of payment shall
be in the same proportion that existed prior to the exercise of the right of
setoff, banker's lien or counterclaim or receipt of payment; and (b) such other
adjustments and purchases of participations shall be made from time to time as
shall be equitable to ensure that all Lenders share any payment obtained in
respect of the Outstanding Obligations ratably in accordance with each Lender's
share of the Outstanding Obligations immediately prior to, and without taking
into account, the payment; provided that, if all or any portion of a
--------
disproportionate payment obtained as a result of the exercise of the right of
setoff, banker's lien, counterclaim or otherwise is thereafter recovered from
the purchasing Lender by Borrower or any Person claiming through or succeeding
to the rights of Borrower, the purchase of a participation shall be rescinded
and the purchase price thereof shall be restored to the extent of the recovery,
but without interest. Each Lender that purchases a participation in the
Outstanding Obligations pursuant to this Section shall from and after the
purchase have the right to give all notices, requests, demands, directions and
other communications under this Agreement with respect to the portion of the
Outstanding Obligations purchased to the same extent as though the purchasing
Lender were the original owner of the Outstanding Obligations purchased.
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding a participation in an Obligation so purchased may exercise any
and all rights of setoff, banker's lien or counterclaim with respect to the
participation as fully as if Lender were the original owner of the Obligation
purchased.
10.07 No Waiver; Cumulative Remedies.
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(a) No failure by any Lender or Administrative Agent to exercise, and no
delay by any Lender or Administrative Agent in exercising, 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 under any
Loan Document preclude any other or further exercise thereof or the exercise of
any other right, remedy, power or privilege. Without limiting the generality of
the foregoing, the terms and conditions of Section 4 may be waived in whole or
---------
in part, with or without terms or conditions, in respect of any Extension of
Credit without prejudicing Administrative Agent's or Lenders' rights to assert
them in whole or in part in respect of any other Extension of Credit.
(b) The rights, remedies, powers and privileges herein or therein provided
are cumulative and not exclusive of any rights, remedies, powers and privileges
provided by Law. Any decision by Administrative Agent or any Lender not to
require payment of any interest (including Default Interest), fee, cost or other
amount payable under any Loan Document or to calculate any amount payable by a
particular method on any occasion shall in no way limit or be deemed a waiver of
Administrative Agent's or such Lender's right to require full payment thereof,
or to calculate an amount payable by another method that is not inconsistent
with this Agreement, on any other or subsequent occasion.
(c) The terms and conditions of Section 9 are for the sole benefit of
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Administrative Agent and Lenders.
10.08 Usury. Notwithstanding anything to the contrary contained in any
Loan Document, the interest and fees paid or agreed to be paid under the Loan
Documents shall not exceed the maximum rate of non-usurious interest permitted
by applicable Law (the "Maximum Rate"). If Administrative Agent or any Lender
------------
shall receive interest or a fee in an amount that exceeds the Maximum Rate, the
excessive interest or fee shall be applied to the principal of the Outstanding
Obligations or, if it exceeds the unpaid principal, refunded to Borrower. In
determining whether the interest or a fee contracted for, charged, or received
by Administrative Agent or a Lender exceeds the Maximum Rate, such Person may,
to the extent permitted by applicable Law, (a) characterize any payment that is
not principal as an expense, fee, or premium rather than interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate,
allocate, and spread in equal or unequal parts the total amount of interest
throughout the contemplated term of the Obligations.
10.09 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.10 Integration. This Agreement, together with the other Loan Documents
and any letter agreements referred to herein, comprises the complete and
integrated agreement of the parties on the subject matter hereof and supersedes
all prior agreements, written or oral, on the subject matter hereof. In the
event of any conflict between the provisions of this Agreement and those of any
other Loan Document, the provisions of this Agreement shall control and govern;
provided that the inclusion of supplemental rights or remedies in favor of
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Administrative Agent or Lenders in any other Loan Document shall not be deemed a
conflict with this Agreement. Each Loan Document was drafted with the joint
participation of the respective parties thereto and
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shall be construed neither against nor in favor of any party, but rather in
accordance with the fair meaning thereof.
10.11 Nature of Lenders' Obligations. Nothing contained in this Agreement
or any other Loan Document and no action taken by Administrative Agent or
Lenders or any of them pursuant hereto or thereto may, or may be deemed to, make
Lenders a partnership, an association, a joint venture or other entity, either
among themselves or with Borrower or any Affiliate of Borrower. Each Lender's
obligation to make any Extension of Credit pursuant hereto is several and not
joint or joint and several, and in the case of the initial Extension of Credit
only is conditioned upon the performance by all other Lenders of their
obligations to make the initial Extension of Credit. A default by any Lender
will not increase the Pro Rata Share attributable to any other Lender.
10.12 Survival of Representations and Warranties. All representations and
warranties made hereunder and in any Loan Document, certificate or statement
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery thereof but shall terminate the later
of (a) when the Commitments are terminated and (b) when no Obligations remain
outstanding under any Loan Document. Such representations and warranties have
been or will be relied upon by Administrative Agent and each Lender,
notwithstanding any investigation made by Administrative Agent or any Lender or
on their behalf.
10.13 Indemnity by Borrower. Borrower agrees to indemnify, save and hold
harmless each Administrative Agent-Related Person and each Lender and their
respective Affiliates, directors, officers, agents, attorneys and employees
(collectively, the "Indemnitees") from and against: (a) any and all claims,
-----------
demands, actions or causes of action that are asserted against any Indemnitee by
any Person (other than Administrative Agent or any Lender) relating directly or
indirectly to a claim, demand, action or cause of action that such Person
asserts or may assert against Borrower, any of its Affiliates or any its
officers or directors; (b) any and all claims, demands, actions or causes of
action arising out of or relating to, the Loan Documents, any predecessor loan
documents, the Commitments, the use or contemplated use of the proceeds of any
Loan, or the relationship of Borrower, Administrative Agent and Lenders under
this Agreement; (c) any administrative or investigative proceeding by any
Governmental Authority arising out of or related to a claim, demand, action or
cause of action described in subsection (a) or (b) above; and (d) any and all
liabilities, losses, costs or expenses (including Attorney Costs) that any
Indemnitee suffers or incurs as a result of the assertion of any foregoing
claim, demand, action, cause of action or proceeding, or as a result of the
preparation of any defense in connection with any foregoing claim, demand,
action, cause of action or proceeding, in all cases, whether or not an
Indemnitee is a party to such claim, demand, action, cause of action or
proceeding, including those liabilities caused by an Indemnitee's own negligence
(all the foregoing, collectively, the "Indemnified Liabilities"); provided that
----------------------- --------
no Indemnitee shall be entitled to indemnification for any loss caused by its
own gross negligence or willful misconduct or for any loss asserted against it
by another Indemnitee.
10.14 Nonliability of Lenders.
Borrower acknowledges and agrees that:
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(a) Any inspections of any property of Borrower made by or through
Administrative Agent or Lenders are for purposes of administration of the Loan
Documents only, and Borrower is not entitled to rely upon the same (whether or
not such inspections are at the expense of Borrower);
(b) By accepting or approving anything required to be observed, performed,
fulfilled or given to Administrative Agent or Lenders pursuant to the Loan
Documents, neither Administrative Agent nor Lenders shall be deemed to have
warranted or represented the sufficiency, legality, effectiveness or legal
effect of the same, or of any term, provision or condition thereof, and such
acceptance or approval thereof shall not constitute a warranty or representation
to anyone with respect thereto by Administrative Agent or Lenders;
(c) The relationship between Borrower and Administrative Agent and Lenders
is, and shall at all times remain, solely that of borrower and lenders; neither
Administrative Agent nor any Lender shall under any circumstance be deemed to be
in a relationship of confidence or trust or a fiduciary relationship with
Borrower or its Affiliates, or to owe any fiduciary duty to Borrower or its
Affiliates; neither Administrative Agent nor any Lender undertakes or assumes
any responsibility or duty to Borrower or its Affiliates to select, review,
inspect, supervise, pass judgment upon or inform Borrower or its Affiliates of
any matter in connection with their property or the operations of Borrower or
its Affiliates; Borrower and its Affiliates shall rely entirely upon their own
judgment with respect to such matters; and any review, inspection, supervision,
exercise of judgment or supply of information undertaken or assumed by
Administrative Agent or any Lender in connection with such matters is solely for
the protection of Administrative Agent and Lenders and neither Borrower nor any
other Person is entitled to rely thereon; and
(d) Neither Administrative Agent nor any Lender shall be responsible or
liable to any Person for any loss, damage, liability or claim of any kind
relating to injury or death to Persons or damage to property caused by the
actions, inaction or negligence of Borrower and/or its Affiliates and Borrower
hereby indemnifies and holds Administrative Agent and Lenders harmless from any
such loss, damage, liability or claim.
10.15 No Third Parties Benefited. This Agreement is made for the purpose
of defining and setting forth certain obligations, rights and duties of
Borrower, Administrative Agent and Lenders in connection with the Extensions of
Credit, and is made for the sole benefit of Borrower, Administrative Agent and
Lenders, and Administrative Agent's and Lenders' successors and assigns. Except
as provided in Sections 10.04 and 10.13, no other Person shall have any rights
-------------- -----
of any nature hereunder or by reason hereof.
10.16 Severability. Any provision of the Loan Documents that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.17 Confidentiality. Administrative Agent and each Lender shall use any
confidential non-public information concerning Borrower and its Subsidiaries
that is furnished to
-60-
Administrative Agent or such Lender by or on behalf of Borrower and its
Subsidiaries in connection with the Loan Documents (collectively, "Confidential
------------
Information") solely for the purpose of evaluating and providing products and
-----------
services to them and administering and enforcing the Loan Documents, and it will
hold the Confidential Information in confidence. Notwithstanding the foregoing,
Administrative Agent and each Lender may disclose Confidential Information (a)
to their Affiliates or any of their or their Affiliates' directors, officers,
employees, advisors, or representatives (collectively, the "Representatives")
---------------
whom it determines need to know such information for the purposes set forth in
this Section; (b) to any bank or financial institution or other entity to which
such Lender has assigned or desires to assign an interest or participation in
the Loan Documents or the Obligations, provided that any such foregoing
--------
recipient of such Confidential Information agrees to keep such Confidential
Information confidential as specified herein; (c) to any governmental agency or
regulatory body having or claiming to have authority to regulate or oversee any
aspect of Administrative Agent's or such Lender's business or that of its
Representatives in connection with the exercise of such authority or claimed
authority; (d) to the extent necessary or appropriate to effect or preserve
Administrative Agent's or such Lender's or any of their Affiliates' security (if
any) for any Obligation or to enforce any right or remedy or in connection with
any claims asserted by or against Administrative Agent or such Lender or any of
their Representatives; and (e) pursuant to any subpoena or any similar legal
process. For purposes hereof, the term "Confidential Information" shall not
include information that (x) is in Administrative Agent's or a Lender's
possession prior to its being provided by or on behalf of the Borrower Parties,
provided that such information is not known by Administrative Agent or such
--------
Lender to be subject to another confidentiality agreement with, or other legal
or contractual obligation of confidentiality to, Borrower, (y) is or becomes
publicly available (other than through a breach hereof by Administrative Agent
or such Lender), or (z) becomes available to Administrative Agent or such Lender
on a nonconfidential basis, provided that the source of such information was not
--------
known by Administrative Agent or such Lender to be bound by a confidentiality
agreement or other legal or contractual obligation of confidentiality with
respect to such information.
10.18 Further Assurances. Borrower and its Subsidiaries shall, at their
expense and without expense to Lenders or Administrative Agent, do, execute and
deliver such further acts and documents as any Lender or Administrative Agent
from time to time reasonably requires for the assuring and confirming unto
Lenders or Administrative Agent of the rights hereby created or intended now or
hereafter so to be, or for carrying out the intention or facilitating the
performance of the terms of any Loan Document.
10.19 Headings. Section headings in this Agreement and the other Loan
Documents are included for convenience of reference only and are not part of
this Agreement or the other Loan Documents for any other purpose.
10.20 Time of the Essence. Time is of the essence of the Loan Documents.
10.21 Foreign Lenders. Each Lender that is a "foreign corporation,
partnership or trust" within the meaning of the Code shall deliver to
Administrative Agent, prior to receipt of any payment subject to withholding
under the Code (or after accepting an assignment of an interest herein), two
duly signed completed copies of either Form W-8BEN or any successor thereto
(relating to such Person and entitling it to a complete exemption from
withholding on all
-61-
payments to be made to such Person by Borrower pursuant to this Agreement) or
Form W-8ECI or any successor thereto (relating to all payments to be made to
such Person by Borrower pursuant to this Agreement) of the United States
Internal Revenue Service or such other evidence satisfactory to Borrower and
Administrative Agent that no withholding under the federal income tax laws is
required with respect to such Person. Thereafter and from time to time, each
such Person shall (a) promptly submit to Administrative Agent such additional
duly completed and signed copies of one of such forms (or such successor forms
as shall be adopted from time to time by the relevant United States taxing
authorities) as may then be available under then current United States laws and
regulations to avoid, or such evidence as is satisfactory to Borrower and
Administrative Agent of any available exemption from, United States withholding
taxes in respect of all payments to be made to such Person by Borrower pursuant
to this Agreement, and (b) take such steps as shall not be materially
disadvantageous to it, in the reasonable judgment of such Lender, and as may be
reasonably necessary (including the re-designation of its Lending Office) to
avoid any requirement of applicable Laws that Borrower make any deduction or
withholding for taxes from amounts payable to such Person. If such Persons fails
to deliver the above forms or other documentation, then Administrative Agent may
withhold from any interest payment to such Person an amount equivalent to the
applicable withholding tax imposed by Sections 1441 and 1442 of the Code,
without reduction. If any Governmental Authority asserts that Administrative
Agent did not properly withhold any tax or other amount from payments made in
respect of such Person, such Person shall indemnify Administrative Agent
therefor, including all penalties and interest and costs and expenses (including
Attorney Costs) of Administrative Agent. The obligation of Lenders under this
Section shall survive the payment of all Obligations and the resignation or
replacement of Administrative Agent.
10.22 Removal and Replacement of Lenders.
(a) Under any circumstances set forth in this Agreement providing that
Borrower shall have the right to remove and replace a Lender as a party to this
Agreement, Borrower may, upon notice to such Lender and Administrative Agent,
remove such Lender by (i) non ratably terminating such Lender's Commitment and
(ii) if being replaced, causing such Lender to assign its Commitment to one or
more other Lenders or Eligible Assignees acceptable to Borrower and
Administrative Agent; provided, however, that during the existence of any Event
-------- -------
of Default, Borrower may not remove or replace a Lender pursuant to this Section
-------
10.22. Any removed or replaced Lender shall be entitled to (x) payment in full
-----
of all principal, interest, fees and other amounts owing to such Lender or such
Lender's affiliated Indemnitees under any Loan Document through the date of
termination or assignment (including any amounts payable pursuant to Section
-------
3.05), (y) a release of such Lender from its obligations under the Loan
----
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Acceptance covering such Lender's Commitment, and shall otherwise comply with
Section 10.04. Administrative Agent shall distribute an amended Schedule 2.01,
------------- -------------
which shall thereafter be incorporated into this Agreement, to reflect
adjustments to Lenders and their Commitments.
(b) In order to make all Lender's interests in any outstanding Extensions
of Credit ratable in accordance with any revised Pro Rata Shares after giving
effect to the removal or replacement of a Lender, Borrower shall pay or prepay,
if necessary, on the effective date thereof, all outstanding Extensions of
Credit of all Lenders, together with any amounts due under
-62-
Section 3.05. Borrower may then request Extensions of Credit from Lenders in
------------
accordance with their revised Pro Rata Shares.
10.23 Governing Law.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT ADMINISTRATIVE AGENT AND
--------
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR
OF THE UNITED STATES FOR THE CENTRAL DISTRICT OF SUCH STATE, AND BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, BORROWER, ADMINISTRATIVE AGENT AND EACH LENDER
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. BORROWER, ADMINISTRATIVE AGENT AND EACH LENDER
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 ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED HERETO. BORROWER, ADMINISTRATIVE
AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
STATE.
10.24 Waiver of Right to Trial by Jury. EACH PARTY TO THIS AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
-63-
10.25 Entire Agreement. This Agreement and the other Loan Documents
represent the final agreement between the parties and may not be contradicted by
evidence of prior, contemporaneous, or subsequent oral agreements of the
parties. There are no unwritten oral agreements between the parties.
-64-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
QUANTUM CORPORATION
By: /s/ Xxxxxx Xxxxxx
-------------------------------------------
Xxxxxx Xxxxxx
-------------------------------------------
Vice President, Finance & General Counsel
-------------------------------------------
-65-
BANK OF AMERICA, N.A., as
Administrative Agent and Lender
By: /s/ Xxxxxx Xxxxxxxxx
------------------------------------------
Name: Xxxxxx Xxxxxxxxx
---------------------------------------
Title: Vice President
---------------------------------------
-00-
XXX XXXX XX XXXX XXXXXX, as Lender
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Name: Xxxxx Xxxxxx
-----------------------------------------
Title: Director, TEG
---------------------------------------
-67-
FLEET NATIONAL BANK, as Lender
By: /s/ Xxxxxxx X. Xxxxxx, Xx.
------------------------------------------
Name: Xxxxxxx X. Xxxxxx, Xx.
---------------------------------------
Title: Executive Vice President
---------------------------------------
-68-
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as Lender
By: /s/ Xxx Xxxxxx
------------------------------------------
Name: Xxx Xxxxxx
---------------------------------------
Title: Senior Vice President
--------------------------------------
-69-
BANQUE NATIONALE DE PARIS, as Lender
By: /s/ Xxxxxxx X. XxXxxxxxxxx /s/ Xxxxx Xxxxxx
-----------------------------------------------------
Name: Xxxxxxx X. XxXxxxxxxxx Xxxxx Xxxxxx
---------------------------------------------------
Title: Vice President Vice President
--------------------------------------------------
-70-
CITICORP USA, INC., as Lender
By: /s/ Xxxxx Xxxxxxx
--------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------
Title: Vice President
------------------------------
-71-
KEYBANK NATIONAL ASSOCIATION, as Lender
By: /s/ Xxxx X. Xxxxx
-------------------------------------------
Name: Xxxx X. Xxxxx
-----------------------------------------
Title: Vice President
----------------------------------------
-72-
THE SUMITOMO BANK, LIMITED, as Lender
By: /s/ Xxxx Xxxxxxx
-------------------------------------------
Name: Xxxx Xxxxxxx
-----------------------------------------
Title: Vice President & Manager
----------------------------------------
-00-
XXXXX XXXX XX XXXXXXXXXX, N.A., as Lender
By: /s/ Xxxxx Xxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxx
---------------------------------------
Title: Vice President
--------------------------------------
-74-
EXHIBIT A
FORM OF REQUEST FOR EXTENSION OF CREDIT
Date: _______________, ____
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of April
19, 2000 between Quantum Corporation, a Delaware corporation ("Borrower"),
Lenders from time to time party thereto and Bank of America, N.A., as
Administrative Agent (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
---------
therein being used herein as therein defined).
The undersigned hereby requests (select one):
[_] A Borrowing of Loans [_] A Conversion or Continuation of Loans
1. On______________________
2. In the amount of $______________________
3. Comprised of ___________________________
[type of Loan requested]
4. If applicable: with an Interest Period of __________ months.
The foregoing request complies with the requirements of Section 2.01 of
the Agreement. Other than in connection with a Conversion or Continuation of
Loans, the undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the above date, before and after giving
effect to the Extension of Credit:
(a) The representations and warranties made by Borrower in the
Agreement, or which are contained in any certificate, document or
financial or other statement furnished at any time under or in
connection therewith, are and will be correct on and as of the date of
this Extension of Credit, except to the extent that such
representations and warranties specifically refer to any earlier date;
and
A-1
Form of Request for Extension of Credit
(b) no Default or Event of Default has occurred and is continuing on the
date hereof or after giving effect to this Extension of Credit.
QUANTUM CORPORATION
By: __________________________________
Name: ________________________________
Title: _______________________________
A-2
Form of Request for Extension of Credit
EXHIBIT B
FORM OF COMPLIANCE CERTIFICATE
Financial Statement Date: _______________________,___
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of April
19, 2000 between Quantum Corporation, a Delaware corporation ("Borrower"),
Lenders from time to time party thereto and Bank of America, N.A., as
Administrative Agent (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
therein being used herein as therein defined).
The undersigned Responsible Officer hereby certifies as of the date
hereof that he is the ____________________________________ of Borrower, and
that, as such, he is authorized to execute and deliver this Certificate to
Administrative Agent on the behalf of Borrower, and that:
[Use following for fiscal year-end financial statements]
1. Attached hereto as Schedule 1 are the year-end audited financial
statements required by Section 6.01(a) of the Agreement for the fiscal year of
---------------
Borrower ended as of the above date, together with the report and opinion of an
independent certified public accountant required by such section.
[Use following for fiscal quarter-end financial statements]
1. Attached hereto as Schedule 1 are the unaudited financial statements
----------
required by Section 6.01(b) of the Agreement for the fiscal quarter of Borrower
---------------
ended as of the above date. Such financial statements fairly present the
financial condition, results of operations and changes in financial position of
Borrower and its Subsidiaries in accordance with GAAP as at such date and for
such periods, subject only to normal year-end audit adjustments and the absence
of footnotes.
2. The undersigned has reviewed and is familiar with the terms of the
Agreement and has made, or has caused to be made under his supervision, a
detailed review of the transactions and conditions (financial or otherwise) of
Borrower during the accounting period covered by the attached financial
statements.
3. A review of the activities of the Borrower Parties during such
fiscal period has been made under my supervision with a view to determining
whether during such fiscal period Borrower performed and observed all its
respective Obligations under the Loan Documents, and
[select one:]
B-1
Form of Compliance Certificate
[to the best knowledge of the undersigned during such fiscal period,
Borrower performed and observed each covenant and condition of the Loan
Documents applicable to it.]
--or--
[the following covenants or conditions have not been performed or
observed and the following is a list of all such Defaults and its nature and
status:]
4. The following financial covenant analyses and information set forth
on Schedule 2 attached hereto are true and accurate on and as of the date of
this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
________________, ___________.
QUANTUM CORPORATION
By: _____________________________
Name: ___________________________
Title: __________________________
B-2
Form of Compliance Certificate
For the Quarter/Year ended _______________ ("Statement Date")
--------------
SCHEDULE 2
to the Compliance Certificate
($ in 000's)
I. Section 7.12(a) - Minimum Consolidated Tangible Net Worth.
A. Actual Consolidated Tangible Net Worth at Statement Date:
1. Shareholders' Equity: $_______________
2. Intangible Assets: $_______________
3. Consolidated Tangible Net Worth
(Lines I.A.1 less Line I.A.2): $_______________
B. 75% of Consolidated Tangible Net Worth as of
March 31, 2000 $_______________
C. equal to 75% of the sum of positive
Consolidated Net Income (ignoring any quarterly
losses) for each fiscal quarter after the
quarter ended March 31, 2000, through and
including the quarter ending on the Statement
Date: $_______________
D. Amount equal to 75% of the Net Proceeds of all
Equity Securities issued by Borrower (excluding
any issuance where the Net Proceeds to Borrower
are less than $10,000,000) during the period
commencing on March 31, 2000 and ending on the
Statement Date: $______________
E. Amount equal to 75% of the increase in the value
of outstanding Equity Securities resulting from
any conversion of Convertible Subordinated
Debentures into Equity Securities during the
period commencing on March 31, 2000 and ending
on the Statement Date: $_______________
F. Lesser of (i) the aggregate amount paid by
Borrower to repurchase Equity Securities during
the period commencing on March 31, 2000 and
ending on the $______________
B-3
Form of Compliance Certificate
Statement Date and (ii) $200,000,000:
G. Lesser of (i) the aggregate amount of charges
taken by Borrower for In Process Research &
Development associated with Acquisitions during
the period commencing on March 31, 2000 and
ending on the Statement Date and (ii)
$100,000,000; provided that any such amounts
--------
were paid during the quarter in which any such
Acquisition was completed: $______________
H. Sum of: Lines I.B + I.C + I.D + I.E less I.F
less I.G: $______________
I. Greater of Line I.B and I.H: $______________
J. Excess (deficiency) for covenant compliance
(Lines I.A.3 less I.I): $_______________
II. Section 7.12(b) - Minimum Quick Ratio.
A. Quick Assets:
1. Amount of cash and cash equivalents of
Borrower and its Subsidiaries
(excluding restricted cash) as of the
Statement Date: $______________
2. Amount of all accounts receivable of
Borrower and its Subsidiaries, less all
reserves therefor, as of the Statement
Date: $______________
3. Amount of Quick Assets as of Statement
Dates II.A.1 + 2): $______________
B. Current Liabilities:
1. Amount of current liabilities of Borrower
and its Subsidiaries as of the Statement
Date: $______________
2. Amount of Outstanding Obligations (to the
extent not included in Line II.B.1): $______________
3. Amount of total current liabilities of
Borrower and its Subsidiaries as of the
Statement Date (Line II.B.1 + 2): $______________
C. Quick Ratio ((Line II.A.3 / Line II.B.3): ___________to 1
B-4
Form of Compliance Certificate
Minimum required: 1.10 to 1
III. Section 7.12(c) - Maximum Leverage Ratio.
A. Consolidated EBITDA measured on a rolling
four quarter basis for the four fiscal quarters
ended as of the Statement Date ("Subject
Period"):
1. Consolidated Net income for Subject
Period: $______________
2. Consolidated Interest Charges for
Subject Period: $______________
3. Provision for income taxes for Subject
Period: $______________
4. Depreciation expenses for Subject
Period: $______________
5. Amortization expenses for intangibles
for Subject Period: $______________
6. Amount written off in connection with
In-Process Research & Development
related to the Meridian Acquisition
(in the second fiscal quarter of year
2000 only): $______________
7. Amount of charge taken in connection
with HDD (in the second fiscal quarter
of year 2000 only): $______________
8. Amount of charge taken in connection
with DSS (in the fourth fiscal quarter
of year 2000 only): $______________
9. Lesser of (i) the aggregate amount of
charges taken by Borrower for In
Process Research & Development
associated with Acquisitions during the
period commencing on March 31, 2000 and
ending on the Statement Date and (ii)
$100,000,000; provided that any such
amounts were paid during the quarter in
which any such Acquisition was
completed $______________
B-5
Form of Compliance Certificate
10. Consolidated EBITDA (Lines III.A.1 +
2 + 3 + 4 + 5 + 6 + 7 + 8 + 9): $______________
B. Consolidated Funded Indebtedness at Statement
Date: $______________
C. Leverage Ratio (Line III.B / Line III.A.10): ___________to 1
Maximum permitted: 2.00 to 1
IV. Section 7.12(d) - Minimum Profitability.
A. 5% of Consolidated Tangible Net Worth as of
Statement Date: $______________
B. Aggregate amount of the two greatest quarterly
losses incurred during the four quarters
immediately preceding the Statement Date: $______________
C. Excess (deficiency) for covenant compliance
(Line IV.A less Line IV.B): $______________
D. Cumulative Consolidated Net Income for the four
quarters immediately preceding the Statement
Date: $______________
E. Excess (deficiency) for covenant compliance
(Line IV.D less $1.00): $______________
B-6
Form of Compliance Certificate
EXHIBIT C
FORM OF NOTE
___________________________ April 19, 2000
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises
--------
to pay to the order of ________________. (the "Lender"), on the Revolving
------
Termination Date or, if there has occurred a Term Conversion, on the Term
Maturity Date (as defined in the Credit Agreement referred to below) the
principal amount of ___________________ ($____________), or such lesser
principal amount of Loans (as defined in the Credit Agreement referred to below)
payable by Borrower to Lender on such Revolving Termination Date or Term
Maturity Date, as applicable, under that certain Credit Agreement
(364-Day/1-Year), dated as of April 19, 2000, among Borrower, Lenders from time
to time party thereto and Bank of America, N.A., as Administrative Agent (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the "Agreement;" the terms defined therein being used herein as
---------
therein defined).
Borrower promises to pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount is paid in
full, at such interest rates, and payable at such times as are specified in the
Credit Agreement.
All payments of principal and interest shall be made to Administrative
Agent for the account of Lender in United States dollars in immediately
available funds at Administrative Agent's Payment office.
If any amount is not paid in full when due hereunder, such unpaid
amount shall bear interest, to be paid upon demand, from the due date thereof
until the date of actual payment (and before as well as after judgment) computed
at the per annum rate set forth in the Credit Agreement.
This Note is one of the "Notes" referred to in the Credit Agreement.
-----
Reference is hereby made to the Credit Agreement for rights and obligations of
payment and prepayment, events of default and the right of Lender to accelerate
the maturity hereof upon the occurrence of such events. Loans made by Lender
shall be evidenced by one or more loan accounts or records maintained by Lender
in the ordinary course of business. Lender may also attach schedules to this
Note and endorse thereon the date, amount and maturity of its Loans and payments
with respect thereto.
Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Note.
Borrower agrees to pay all collection expenses, court costs and
Attorney Costs (whether or not litigation is commenced) which may be incurred by
Lender in connection with the collection or enforcement of this Note.
C-1
Form of Note
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF CALIFORNIA.
QUANTUM CORPORATION
By:_____________________________
Name:___________________________
Title:__________________________
C-2
Form of Note
LOANS AND PAYMENTS WITH RESPECT THERETO
Amount of Outstanding
End of Principal or Principal
Type of Amount of Interest Interest Paid Balance This Notation
Date Loan Made Loan Made Period This Date Date Made by
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C-3
Form of Note
EXHIBIT D
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement (364-Day/1-Year)
dated as of April 19, 2000 between Quantum Corporation, a Delaware corporation
("Borrower"), Lenders from time to time party thereto and Bank of America, N.A.,
--------
as Administrative Agent (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the "Agreement;" the terms
---------
defined therein being used herein as therein defined).
The Assignor identified on Schedule l hereto ("Assignor") and the
--------
Assignee identified on Schedule l hereto ("Assignee") agree as follows:
--------
1. Assignor hereby irrevocably sells and assigns to Assignee without
recourse to Assignor, and Assignee hereby irrevocably purchases and assumes from
Assignor without recourse to Assignor, as of the Effective Date (as defined
below), the interest described in Schedule 1 hereto (the "Assigned Interest") in
-----------------
and to Assignor's rights and obligations under the Agreement with respect to
those Commitment(s) and Outstanding Obligations contained in the Agreement as
are set forth on Schedule 1 hereto (individually, an "Assigned Commitment";
-------------------
collectively, the "Assigned Commitments"), in the principal amount for each
--------------------
Assigned Commitment as set forth on Schedule 1 hereto.
2. Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Agreement or with respect to the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto, other than that Assignor has not created any adverse claim
upon the interest being assigned by it hereunder and that such interest is free
and clear of any such adverse claim; and (b) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrower or any of its Subsidiaries or any other obligor or the performance or
observance by Borrower or any of its Subsidiaries or any other obligor of any of
its respective obligations under the Agreement or any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto.
3. Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has received a
copy of the Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 4.01 or 6.02 thereof, as applicable,
------------ ----
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Acceptance; (c) agrees that it will, independently and without reliance upon
Assignor, Administrative Agent or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Agreement, the
other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto; (d) appoints and authorizes Administrative Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
the Agreement, the other Loan
D-1
Form of Assignment and Acceptance
Documents or any
other instrument or document furnished pursuant hereto or thereto as are
delegated to Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; and (e) agrees that it will be bound by the
provisions of the Agreement and will perform in accordance with its terms all
the obligations which by the terms of the Agreement are required to be performed
by it as a Lender.
4. The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the "Effective
---------
Date"). Following the execution of this Assignment and Acceptance, it will be
----
delivered to Administrative Agent and to the Borrower for its consent (if such
consent is required) and, if such consent is granted, for acceptance and
recording by Administrative Agent pursuant to the Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by Administrative
Agent, be earlier than five Business Days after the date of such acceptance and
recording by Administrative Agent.
5. Upon such consent, acceptance and recording, from and after the
Effective Date, Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to Assignee whether such amounts have accrued prior to or on or after
the Effective Date. Assignor and Assignee shall make all appropriate adjustments
in payments by Administrative Agent for periods prior to the Effective Date or
with respect to the making of this assignment directly between themselves.
6. From and after the Effective Date, (a) Assignee shall be a party to
the Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender thereunder and under the other Loan
Documents and shall be bound by the provisions thereof and (b) Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Agreement.
7. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.
D-2
Form of Assignment and Acceptance
SCHEDULE 1 TO ASSIGNMENT AND ACCEPTANCE
------------------------------------------------------------------------------
Amount of Outstanding Pro Rata Share Assigned (set
Commitment Assigned Obligations Assigned forth to at least 8 decimals)
---------------------------------- --------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Effective Date of Assignment: ____________, ________
[ASSIGNOR]
By:________________________________
Name:______________________________
Title:_____________________________
[ASSIGNEE]
By:________________________________
Name:______________________________
Title:_____________________________
The undersigned hereby consent to the within assignment:
QUANTUM CORPORATION
By:_________________________
Name:_______________________
Title:______________________
BANK OF AMERICA, N.A., as Administrative Agent
By:_________________________
Name:_______________________
Title:______________________
D-3
Form of Assignment and Acceptance
EXHIBIT E
FORM OF TERM CONVERSION REQUEST
Date: ________________
To: Bank of America, N.A.,
as Administrative Agent
Ladies and Gentlemen:
The undersigned ("Borrower"), refers to the Credit Agreement (364-Day/1-
--------
Year) dated as of April 19, 2000 (as extended, renewed, amended or restated from
time to time, the "Agreement"), among Borrower, the other financial institutions
---------
party thereto (collectively, "Lenders" and individually, a "Lender"), and Bank
------- ------
of America, N.A., as Administrative Agent ("Administrative Agent"), the terms
--------------------
defined therein being used herein as therein defined, and hereby gives you
notice irrevocably, pursuant to Section 2.01(b) of the Agreement, of the
---------------
conversion of all outstanding Revolving Loans into Term Loans on and as of the
Revolving Termination Date, as specified below:
The aggregate amount of the Revolving Loans to be converted into
Term Loans is $_______________, and consist of the following:
Base Rate Loans: $__________________
Offshore Rate Loans: $__________________
Interest Period Amount
--------------- ------
Total Offshore Rate Loans: $__________.
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the proposed Term Conversion,
before and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of Borrower contained in
Section 5 of the Credit Agreement are true and correct as though made on
---------
and as of such date, except to the extent such representations and
warranties expressly refer to an earlier date, in which case they are true
and correct as of such date, and except that this notice shall be deemed
instead to refer to the last day of the most recent year for which
financial statements have then been delivered in respect of the
representation and warranty made in Section 5.04(a) of the Credit
Agreement; and
E-1
Form of Assignment and Acceptance
(b) no Default or Event of Default has occurred and is continuing, or
would result from such proposed Term Conversion.
QUANTUM CORPORATION.
By: _______________________________
Title: ____________________________
E-2
Form of Assignment and Acceptance
SCHEDULE 2.01
COMMITMENTS
AND PRO RATA SHARES
Lender Commitment Pro Rata Share
--------------------------------------------------------------------------------
Bank of America, N.A. $32,500,000 17.000000000%
The Bank of Nova Scotia $25,000,000 13.000000000%
Fleet National Bank $25,000,000 13.333333333%
The Industrial Bank of Japan, Limited $25,000,000 13.333333333%
Banque Nationale de Paris $20,000,000 10.666666667%
Citicorp USA, Inc. $20,000,000 10.666666667%
KeyBank National Association $20,000,000 10.666666667%
The Sumitomo Bank, Limited $10,000,000 5.333333333%
Union Bank of California, N.A. $10,000,000 5.333333333%
--------------------------------------------------------------------------------
Total $187,500,000 100.000000000%
------------ --------------
-1-
SCHEDULE 5.05
LITIGATION
On August 7, 1998, the Company was named as one of several defendants
in a patent infringement lawsuit filed in the U.S. District Court for the
Northern District of Illinois, Eastern Division. The plaintiff, Papst Licensing
GmbH, owns at least 24 U.S. patents which it asserts that the Company has
infringed. The Company has studied many of these patents before and, of the
patents it has studied, believes that defenses of patent invalidity and
non-infringement can be asserted. However, the Company has not completed a full
study of all the patents asserted by Papst and there can be no assurance that
the Company has not infringed these or other patents owned by Papst. Recently,
on Papst's motion, the case was transferred to a federal district court in New
Orleans, Louisiana, where it has been joined with suits brought against Papst by
Hewlett-Packard Company and Minebea Company, Ltd. for the purposes of
coordinated discovery under multi-district litigation rules. The Company does
not believe that the transfer will affect the final disposition of this matter
in a significant way. The final results of this litigation, as with any
litigation, are uncertain. In addition, the costs of engaging in litigation with
Papst will be substantial.
The Company is also subject to other legal proceedings and claims that
arise in the ordinary course of its business. For example, both Cambrian
Consultants and Discovision Associates have brought patents they hold to the
Company's attention. While management currently believes the amount of ultimate
liability, if any, with respect to these actions will not materially affect the
financial position, results of operations, or liquidity of the Company, the
ultimate outcome of any litigation is uncertain. Were an unfavorable outcome to
occur, the impact could be material to the Company.
-1-
SCHEDULE 7.01
EXISTING INDEBTEDNESS AND LIENS
INDEBTEDNESS
1. Reimbursement Agreement between Sumitomo Bank, Ltd. and Quantum
Peripherals (Europe), S.A., dated September 14, 1998, related to
outstanding letters of credit in an amount not to exceed $85,000,000.
2. Tax Ownership Operating Lease (Colorado Springs, CO) between Quantum
Corporation and Lease Plan North America, Inc., dated August 25, 1997.
3. Mortgage (Louisville, CO and Shrewsbury, MA), dated August 22, 1995
between Quantum Corporation and QD Investors securing $39,226,000 in
outstanding principal as of December 31, 1999.
4. Reimbursement Agreement between Fleet National Bank and ATL Products,
Inc., a Subsidiary of Borrower, dated February 3, 1999, related to an
outstanding letter of credit in favor of National Westminster Bank,
plc in the amount of(pound)300,000.
LIENS
1. Lien (State: CO, file # 19992029330, dated 5/19/99) established under
the Equipment Lease Agreement between Quantum Corporation and Xxxxxxxx
Property Services, as Debtor, and BCL Capital.
2. Lien (State: CO, file # 19992024197, dated 4/29/99) established under
the Equipment Lease Agreement between Quantum Corporation and Colorado
Business Leasing, Inc.
3. Lien (State: CO, file # 19982060561, dated 9/24/98) established under
the Master Lease Agreement between Quantum Corporation and Avnet
Computer, a division of Avnet, Inc.
4. Lien (State: CO, file # 19972076228, dated 9/5/97) established under
the Financing Statement between Quantum Corporation and Lease Plan
North America, Inc.
5. Lien (State: CO, file # 199F0722387, dated 9/5/97) established under
the Financing Statement between Quantum Corporation and Lease Plan
North America, Inc.
6. Lien (State: CO, file # 962097106, dated 12/30/96) established under
the Agreement between Quantum Corporation and American Leasing, Inc.
-1-
7. Lien (State: CO, file # 962081967, dated 10/31/96) established under
the Agreement between Quantum Corporation and Xxxxxx Leasing, Inc.
8. Lien (State: CA, file # 9732260586, dated 11/18/97) established under
the Lease Agreement between ATL Products, Inc. and Sun Microsystems
Finance.
9. Lien (State: CA, file # 9807660402, dated 3/16/98) established under
the Lease Agreement between ATL Products, Inc. and Union Bank of
California, N.A.
10. Lien (State: CA, file # 9821760711, dated 8/4/98) established under
the Subordination Agreement between ATL Products, Inc. and Mellon US
Leasing, a Division of Mellon Leasing Corporation.
11. Lien (State: CA, file # 9830060877, dated 10/23/98) established under
the Equipment Schedule between ATL Products, Inc. and Mellon US
Leasing, a Division of Mellon Leasing Corporation.
12. Lien (State: CA, file # 9903660704, dated 2/4/99) established under
the Equipment Schedule between ATL Products, Inc. and Mellon US
Leasing, a Division of Mellon Leasing Corporation.
13. Lien (State: CA, file # 9714961077, dated 5/27/97) established under
rental between ATL Products, Inc. and Inter-Tel Leasing, Inc.
14. Lien (State: CA, file # 9719760464, dated 7/11/97) established under
the Agreement between ATL Products, Inc. and Imperial Bank.
15. Lien (State: CA, file # 9510460180, dated 4/10/95) established under
the Financing Agreement between Quantum Corporation and Hewlett-
Packard Company.
16. Lien (State: CA, file # 9510460187, dated 4/10/95) established under
the Financing Agreement between Quantum Corporation and Hewlett-
Packard Company.
17. Lien (State: CA, file # 9526460720, dated 9/18/95) established under
the Alternative Purchase Plan between Quantum Corporation and AT&T
Capital Services Corporation.
18. Lien (State: CA, file # 9620660866, dated 6/22/96) established under
the Financing Agreement between Quantum Corporation and Hewlett-
Packard Company.
19. Lien (State: CA, file # 9623360189, dated 8/16/96) established under
the Security Agreement between Quantum Corporation and Orix Credit
Alliance, Inc.
-2-
20. Lien (State: CA, file # 9636660392, dated 12/30/96) established under
the Equipment Lease Agreement between Quantum Corporation and American
Leasing, Inc.
21. Lien (State: CA, file # 9724660679, dated 9/2/97) established under
the Financing Statement between Quantum Corporation and ABN AMRO Bank,
N.V. San Francisco International Branch, as Agent.
22. Lien (State: CA, file # 9733960635, dated 12/1/97) established under
the Security Agreement between Quantum Corporation and Unisource
Worldwide, Inc.
23. Lien (State: CA, file # 9813360891, dated 5/12/98) established under
the Agreement between Quantum Corporation and AT&T Capital
Corporation, Instrument and Data Services.
24. Lien (State: CA, file # 9818960462, dated 7/6/98) established under
the Agreement between Quantum Corporation and Employment Development
Department.
25. Lien (State: CA, file # 9934060376, dated 12/1/99) established under
the Agreement between Quantum Corporation and Newcourt Technologies
Corp (dba Newcourt Financial-Technology Rentals & Services.
26. Lien (State: CA, file # 9934060391, dated 12/1/99) established under
the Agreement between Quantum Corporation and Newcourt Technologies
Corp (dba Newcourt Financial-Technology Rentals & Services).
27. Lien (State: CA, file # 0003860457, dated 2/2/00) established under
the Equipment Agreement between Quantum Corporation and ATEL Business
Credit, Inc.
28. Lien (State: MA, file # 345962, dated 5/25/95) established under the
Schedule between Quantum Corporation and Comdisco, Inc.
29. Lien (State: MA, file # 343626, dated 10/11/95) established under the
Agreement between Quantum Corporation and Comdisco, Inc.
30. Lien (State: MA, file # 371364, dated 2/23/96) established under the
Agreement between Quantum Corporation and Business Credit Leasing.
31. Lien (State: MA, file # 425668, dated 10/25/96) established under the
Financing Agreement between Quantum Corporation and Hewlett-Packard
Company.
32. Lien (State: MA, file # 456959, dated 3/25/97) established under the
Agreement between Quantum Corporation and Sanwa Leasing Corporation.
33. Lien (State: MA, file # 449499, dated 2/18/97) established under the
Financing Agreement between Quantum Corporation and Hewlett-Packard
Company.
-3-
34. Lien (State: MA, file # 459264, dated 4/7/97) established under the
Agreement between Quantum Corporation and Sanwa Leasing Corporation.
35. Lien (State: MA, file # 468158, dated 5/12/97) established under the
Financing Agreement between Quantum Corporation and Hewlett-Packard
Company.
36. Lien (State: MA, file # 518464, dated 12/22/97) established under the
Agreement between Quantum Corporation and Sanwa Leasing Corporation.
37. Lien (State: MA, file # 582939, dated 10/9/98) established under the
Agreement between Quantum Corporation and Hewlett-Packard Company.
-4-
SCHEDULE 7.13
SUBORDINATION PROVISIONS
Section [__].1 Agreement of Subordination. [Quantum Corporation]
--------------------------
covenants and agrees, and each holder of Notes issued hereunder by his
acceptance thereof likewise covenants and agrees, that all Notes shall be issued
subject to the provisions of this Article [__]; and each Person holding any
Note, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and interest on all
Notes (including, but not limited to, the redemption price with respect to the
Notes called for redemption in accordance with Section [__] [Notice of
Redemption: Selection of Notes] or submitted for redemption in accordance with
Section [__] [Redemption at Option of Holders], as the- case may be, as provided
in the Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full of all Senior Indebtedness, whether outstanding at the
date of this Indenture or thereafter incurred.
No provision of this Article [__] shall prevent the occurrence of any
default or Event of Default hereunder.
Section [__].2 Payments to Noteholders. No payment shall be made with
-----------------------
respect to the principal of, or premium, if any, or interest on the Notes
(including, but not limited to, the redemption price with respect to the Notes
to be called for redemption in accordance with Section [__] [Notice of
Redemption: Selection of Notes] or submitted for redemption in accordance with
Section [__] [Redemption at Option of Holders], as the case may be, as provided
in the Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section [__].5, if:
(i) a default in the payment of principal, premium,
interest, rent or other obligations due on any Senior
Indebtedness occurs and is continuing (or, in the
case of Senior Indebtedness for which there is a
period of grace, in the event of such a default that
continues beyond the period of grace, if any,
specified in the instrument or lease evidencing such
Senior Indebtedness), unless and until such default
shall have been cured or waived or shall have ceased
to exist; or
(ii) a default, other than a payment default, on a
Designated Senior Indebtedness occurs and is
continuing that then permits holders of such
Designated Senior Indebtedness to accelerate its
maturity and the Trustee receives a notice of the
default (a "Payment Blockage Notice") from a
Representative or [Quantum Corporation].
If the Trustee receives any Payment Blockage Notice pursuant to clause
(ii) above, no subsequent Payment Blockage Notice shall be effective for
purposes of this Section [__].2 unless and until (A) at least 365 days shall
have elapsed since the initial effectiveness of the immediately prior Payment
Blockage Notice, and (B) all scheduled payments of principal,
-1-
premium, if any, and interest on the Notes that have come due have been paid in
full in cash. No nonpayment default that existed or was continuing on the date
of delivery of any Payment Blockage Notice to the Trustee shall be, or be made,
the basis for a subsequent Payment Blockage Notice.
[Quantum Corporation] may and shall resume payments on and
distributions in respect of the Notes upon the earlier of:
(1) the date upon which the default is cured or waived or ceases to
exist, or
(2) in the case of a default referred to in clause (ii) above, 179 days
pass after notice is received if the maturity of such Designated Senior
Indebtedness has not been accelerated,
unless this Article [__] otherwise prohibits the payment or distribution at the
time of such payment or distribution.
Upon any payment by [Quantum Corporation], or distribution of assets of
[Quantum Corporation] of any kind or character, whether in cash, property or
securities, to creditors upon any dissolution or winding-up or liquidation or
reorganization of [Quantum Corporation], whether voluntary or involuntary or in
bankruptcy, insolvency, receivership or other proceedings, all amounts due or to
become due upon all Senior Indebtedness shall first be paid in full in cash or
other payment satisfactory to the holders of such Senior Indebtedness, or
payment thereof in accordance with its terms provided for in cash or other
payment satisfactory to the holders of such Senior Indebtedness before any
payment is made on account of the principal of, premium, if any, or interest on
the Notes (except payments made pursuant to Article [__] [Trustee Provisions]
from monies deposited with the Trustee pursuant thereto prior to commencement of
proceedings for such dissolution, winding-up, liquidation or reorganization);
and upon any such dissolution or winding-up or liquidation or reorganization of
[Quantum Corporation] or bankruptcy, insolvency, receivership or other
proceeding, any payment by [Quantum Corporation], or distribution of assets of
[Quantum Corporation] of any kind or character, whether in cash, property or
securities, to which the holders of the Notes or the Trustee would be entitled,
except for the provision of this Article [__], shall (except as aforesaid) be
paid by [Quantum Corporation] or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the holders of the Notes or by the Trustee under this Indenture if
received by them or it, directly to the holders of Senior Indebtedness (pro rata
to such holders on the basis of the respective amounts of Senior Indebtedness
held by such holders, or as otherwise required by law or a court order) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full, in cash or other payment
satisfactory to the holders of such Senior Indebtedness, after giving effect to
any concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the holders of the
Notes or to the Trustee.
For purposes of this Article [__], the words, "cash, property or
securities" shall not be deemed to include shares of stock of [Quantum
Corporation] as reorganized or readjusted, or securities of [Quantum
Corporation] or any other corporation provided for by a plan of
-2-
reorganization or readjustment, the payment of which is subordinated at least to
the extent provided in this Article [__] with respect to the Notes to the
payment of all Senior Indebtedness which may at the time be outstanding;
provided that (i) the Senior Indebtedness is assumed by the new corporation, if
--------
any, resulting from any reorganization or readjustment, and (ii) the rights of
the holders of Senior Indebtedness (other than leases which are not assumed by
[Quantum Corporation] or the new corporation, as the case may be) are not,
without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of [Quantum Corporation] with, or the merger of
[Quantum Corporation] into, another corporation or the liquidation or
dissolution of [Quantum Corporation] following the conveyance or transfer of its
property as an entirety, or substantially as an entirety, to another corporation
upon the terms and conditions provided for in Article [__] [Consolidation,
Merger, Sale, Conveyance and Lease] shall not be deemed a dissolution, winding-
up, liquidation or reorganization for the purposes of this Section [__].2 if
such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article [__]
[Consolidation, Merger, Sale, Conveyance and Lease].
In the event of the acceleration of the Notes because of an Event of
Default, no payment or distribution shall be made to the Trustee or any holder
of Notes in respect of the principal of, premium, if any, or interest on the
Notes (including, but not limited to, the redemption price with respect to the
Notes called for redemption in accordance with Section [__] [Notice of
Redemption; Selection of Notes] or submitted for redemption in accordance with
Section [__] [Redemption at Option of Holders], as the case may be, as provided
in the Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section [__].5, until all Senior
Indebtedness has been paid in full in cash or other payment satisfactory to the
holders of Senior Indebtedness or such acceleration is rescinded in accordance
with the terms of this Indenture. If payment of the Notes is accelerated because
of an Event of Default, [Quantum Corporation] shall promptly notify holders of
Senior Indebtedness of the acceleration.
In the event that, notwithstanding the foregoing provisions, any
payment or distribution of assets of [Quantum Corporation] of any kind or
character, whether in cash, property or securities (including, without
limitation, by way of setoff or otherwise), prohibited by the foregoing, shall
be received by the Trustee or the holders of the Notes before all Senior
Indebtedness is paid in full in cash or other payment satisfactory to the
holders of such Senior Indebtedness, or provision is made for such payment
thereof in accordance with its terms in cash or other payment satisfactory to
the holders of such Senior Indebtedness, such payment or distribution shall be
held in trust for the benefit of and shall be paid over or delivered to the
holders of Senior Indebtedness or their representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness . may have been issued, as their respective
interests may appear, as calculated by [Quantum Corporation], for application to
the payment of all Senior Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness in full in cash or other payment satisfactory to
the holders of such Senior Indebtedness, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior Indebtedness.
-3-
Nothing in this Section [__].2 shall apply to claims of, or payments
to, the Trustee under or pursuant to Section [__] [Compensation and Expenses of
Trustee]. This Section [__].2 shall be subject to the further provisions of
Section [__].5.
Section [__].3 Subrogation of Notes. Subject to the payment in full
--------------------
of all Senior Indebtedness, the rights of the holders of the Notes shall be
subrogated to the extent of the payments or distributions made to the holders of
such Senior Indebtedness pursuant to the provisions of this Article [__]
(equally and ratably with the holders of all indebtedness of [Quantum
Corporation] which by its express terms is subordinated to other indebtedness of
[Quantum Corporation] to substantially the same extent as the Notes are
subordinated and is entitled to like rights of subrogation) to the rights of the
holders of Senior Indebtedness to receive payments or distributions of cash,
property or securities of [Quantum Corporation] applicable to the Senior
Indebtedness until the principal, premium, if any, and interest on the Notes
shall be paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of the Senior Indebtedness of any cash, property or
securities to which the holders of the Notes or the Trustee would be entitled
except for the provisions of this Article [__] and no payment over pursuant to
the provisions of this Article [__] to or for the benefit of the holders of
Senior Indebtedness by holders of the Notes or the Trustee, shall, as between
[Quantum Corporation], its creditors other than holders of Senior Indebtedness,
and the holders of the Notes, be deemed to be a payment by [Quantum Corporation]
to or on account of the Senior Indebtedness; and no payments or distributions of
cash, property or securities to or for the benefit of the holders of the Notes
pursuant to the subrogation provisions of this Article [__], which would
otherwise have been paid to the holders of Senior Indebtedness shall be deemed
to be a payment by [Quantum Corporation] to or for the account of the Notes. It
is understood that the provisions of this Article [__] are and are intended
solely for the purposes of defining the relative rights of the holders of the
Notes, on the one hand, and the holders of the Senior Indebtedness, on the other
hand.
Nothing contained in this Article [__] or elsewhere in this Indenture
or in the Notes is intended to or shall impair, as among [Quantum Corporation]
its creditors other than the holders of Senior Indebtedness, and the holders of
the Notes, the obligation of [Quantum Corporation], which is absolute and
unconditional, to pay to the holders of the Notes the principal of (and premium,
if any) and interest on the Notes as and when the same shall become due and
payable in accordance with their terms, or is intended to or shall affect the
relative rights of the holders of the Notes and creditors of [Quantum
Corporation] other than the holders of the Senior Indebtedness, nor shall
anything herein or therein prevent the Trustee or the holder of any Note from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article [__] of the
holders of Senior Indebtedness in respect of cash, property or securities of
[Quantum Corporation] received upon the exercise of any such remedy.
Upon any payment or distribution of assets of [Quantum Corporation]
referred to in this Article [__], the Trustee, subject to the provisions of
Section [__] [Duties and Responsibilities of Trustee], and the holders of the
Notes shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which such bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or a certificate of the
receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution,
-4-
delivered to the Trustee or to the holders of the Notes, for the purpose of
ascertaining the persons entitled to participate in such distribution, the
holders of the Senior Indebtedness and other indebtedness of [Quantum
Corporation], the amount thereof or payable thereon and all other facts
pertinent thereto or to this Article [__].
Section [__].4 Authorization to Effect Subordination. Each holder of
-------------------------------------
a Note by the holder's acceptance thereof authorizes and directs the Trustee on
the holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article [__] and appoints the
Trustee to act as the holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any proceeding referred to in the third paragraph of Section
[__] [Payments of Notes on Default; Suit Therefor] hereof at least 30 days
before the expiration of the-time to file such claim, the holders of any Senior
Indebtedness or their representatives are hereby authorized to file an
appropriate claim for and on behalf of the holders of the Notes.
Section [__].5 Notice to Trustee. [Quantum Corporation] shall give
-----------------
prompt written notice in the form of an Officers' Certificate to a Responsible
Officer of the Trustee and to any paying agent of any fact known to [Quantum
Corporation] which would prohibit the making of any payment of monies to or by
the Trustee or any paying agent in respect of the Notes pursuant to the
provisions of this Article [__]. Notwithstanding the provisions of this Article
[__] or any other provision of this Indenture, the Trustee shall not be charged
with knowledge of the existence of any facts which would prohibit the making of
any payment of monies to or by the Trustee in respect of the Notes pursuant to
the provisions of this Article [__], unless and until a Responsible Officer of
the Trustee shall have received written notice thereof at the Corporate Trust
Office from [Quantum Corporation] (in the form of an Officers Certificate) or a
Representative or a holder or holders of Senior Indebtedness or from-any trustee
thereof; and before the receipt of any such written notice, the Trustee, subject
to the provisions of Section [__] [Duties and Responsibilities of Trustee],
shall be entitled in all respects to assume that no such facts exist; provided
that if on a date not fewer than one Business Day prior to the date upon which
by the terms hereof any such monies may become payable for any purpose
(including, without limitation, the payment of the principal of, or premium, if
any, or interest on any Note) the Trustee shall not have received, with respect
to such monies, the notice provided for in this Section [__].5, then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such monies and to apply the same to the purpose
for which they were received, and shall not be affected by any notice to the
contrary which may be received by it on or after such prior date.
Notwithstanding anything in this Article [__] to the contrary, nothing
shall prevent any payment by the Trustee to the Noteholders of monies deposited
with it pursuant to Section [__] [Discharge of Indenture], and any such payment
shall not be subject to the provisions of Section [__].1 or [__].2.
The Trustee, subject to the provisions of Section [__] [Duties and
Obligations of Trustee], shall be entitled to rely on the delivery to it of a
written notice by a Representative or a person representing himself to be a
holder of Senior Indebtedness (or a trustee on behalf of such holder) to
establish that such notice has been given by a Representative or a holder of
Senior Indebtedness or a trustee on behalf of any such holder or holders. In the
event that the Trustee
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determines in good faith that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this Article [__], the Trustee may request
such person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of Senior Indebtedness held by such person, the extent to which
such person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such person under this Article [__] and
if such evidence is not furnished the Trustee may defer any payment to such
person pending judicial determination as to the right of such person to receive
such payment.
Section [__].6 Trustee Is Relation to Senior Indebtedness. The
------------------------------------------
Trustee in its individual capacity shall be entitled to all the rights set forth
in this Article [__] in respect of any Senior Indebtedness at any time held by
it, to the same extent as any other holder of Senior Indebtedness, and nothing
in Section [__] [Limitations on Rights of Trustee as Creditor] or elsewhere in
this Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article [__], and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and subject to the
provisions of Section [__] [Duties and Obligations of Trustee], the Trustee
shall not be liable to any holder of Senior Indebtedness if it shall pay over or
deliver to holders of Notes, [Quantum Corporation] or any other person money or
assets to which any holder of Senior Indebtedness shall be entitled by virtue of
this Article [__] or otherwise.
Section [__].7 No Impairment of Subordination. No right of any
------------------------------
present or future holder of any Senior Indebtedness to enforce subordination as
herein provided shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of [Quantum Corporation] or by any act or
failure to act, in good faith, by any such holder, or by any noncompliance by
[Quantum Corporation] with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with.
Section [__].8 Certain Conversions Deemed Payment. For the purposes
----------------------------------
of this Article [__] only, (1) the issuance and delivery of junior securities
upon conversion of Notes in accordance with Article [__] [Conversion of Notes]
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest on Notes or on account of the
purchase or other acquisition of Notes, and (2) the payment, issuance or
delivery of cash (except in satisfaction of fractional shares pursuant to
Section 15.[__] [Cash Payment in Lieu of Fractional Shares]), property or
securities (other than junior securities) upon conversion of a Note shall be
deemed to constitute payment on account of the principal of such Note. For the
purposes of this Section [__].8, the term "junior securities" means (a) shares
of any stock of any class of [Quantum Corporation], or (b) securities of
[Quantum Corporation] which are subordinated in right of payment to all Senior
Indebtedness which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Notes are so subordinated as provided in this Article [__]. Nothing
contained in this Article [__] or elsewhere in this Indenture or in the Notes is
intended to or shall impair, as among [Quantum Corporation], its creditors other
than holders of Senior Indebtedness and the
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Noteholders, the right, which is absolute and unconditional, of the Holder of
any Note to convert such Note in accordance with Article [__] [Conversion of
Notes].
Section [__].9 Article Applicable to Paying Agents. If at any time
-----------------------------------
any paying agent other than the Trustee shall have been appointed by [Quantum
Corporation] and be then acting hereunder, the term "Trustee" as used in this
Article [__] shall (unless the context otherwise requires) be construed as
extending to and including such paying agent within its meaning as fully for all
intents and purposes as if such paying agent were named in this Article [__] in
addition to or in place of the Trustee; provided, however, E-hat the first
paragraph of Section [__].5 shall not apply to [Quantum Corporation] or any
Affiliate of [Quantum Corporation] if it or such Affiliate acts as paying agent.
Section [__].10 Senior Indebtedness Entitled to Rely. The holders of
------------------------------------
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article [__], and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing thereto.
Definitions:
Designated Senior Indebtedness: The term "Designated Senior
------------------------------
Indebtedness" means the Sumitomo Credit Agreement and any particular Senior
Indebtedness in which the instrument creating or evidencing the same or the
assumption or guarantee thereof (or related agreements or documents to which
[Quantum Corporation] is a party) expressly provides that such Indebtedness
shall be "Designated Senior Indebtedness" for purposes of the Indenture
(provided that such instrument, agreement or other document may place
limitations and conditions on the right of such Senior Indebtedness to exercise
the rights of Designated Senior Indebtedness). If any payment made to any holder
of any Designated Senior Indebtedness or its Representative with respect to such
Designated Senior Indebtedness is rescinded or must otherwise be returned by
such holder or Representative upon the insolvency, bankruptcy or reorganization
of [Quantum Corporation] or otherwise, the reinstated Indebtedness of [Quantum
Corporation] arising as a result of such rescission or return shall constitute
Designated Senior Indebtedness effective as of the date of such rescission or
return.
Senior Indebtedness: The term "Senior Indebtedness" means the principal
-------------------
of, premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable as a claim in any such proceeding) and rent
payable on or in connection with, and all fees, costs, expenses and other
amounts accrued or due on or in connection with, Indebtedness of [Quantum
Corporation], whether outstanding on the date of this Indenture or thereafter
created, incurred, assumed, guaranteed or in effect guaranteed by [Quantum
Corporation] (including all deferrals, renewals, extensions or refundings of, or
amendments, modifications or supplements to, the foregoing), unless in the case
of any particular Indebtedness the instrument creating or evidencing the same or
the assumption or guarantee thereof expressly provides that such Indebtedness
shall not be senior in right of payment to the Notes or expressly provides that
such Indebtedness is "pari passu" or "junior" to the Notes. Notwithstanding the
foregoing, the term Senior Indebtedness shall not include any Indebtedness of
[Quantum Corporation] to any subsidiary of [Quantum
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Corporation], a majority of the voting stock of which is owned, directly or
indirectly, by [Quantum Corporation] or [Quantum Corporation]'s 5% Convertible
Subordinated Debentures due April 1, 2002. If any payment made to any holder of
any Senior Indebtedness or its Representative with respect to such Senior
Indebtedness is rescinded or must otherwise be returned by such holder or
Representative upon the insolvency, bankruptcy or reorganization of [Quantum
Corporation] or otherwise, the reinstated Indebtedness of [Quantum Corporation]
arising as a result of such rescission or return shall constitute Senior
Indebtedness effective as of the date of such rescission or return.
Sumitomo Credit Agreement: The term "Sumitomo Credit Agreement" means
-------------------------
that certain Credit Agreement, dated as of September 22, 1995 by and among
[Quantum Corporation], the several financial institutions listed on the
signature pages thereto (collectively, the "Banks"), and The Sumitomo Bank,
Limited, acting through its San Xxxxxxxxx Xxxxxx, as agent for the Banks (the
"Agent") and as Issuer, as amended, amended and restated, supplemented or
otherwise modified from time to time.
-8-
SCHEDULE 10.02
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
QUANTUM CORPORATION
000 XxXxxxxx Xxxxxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, Assistant Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxx.xxxxxx@xxxxxxx.xxx
ADMINISTRATIVE AGENT'S OFFICE:
Notices for Borrowing, Conversions/Continuations, and Payments:
Bank of America, N.A.
Mail Code: CA4-706-05-09
Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Nawaporn Wongbuddhapitak
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxxx.xxxxxxxxxxxxxxx@xxxxxxxxxxxxx.xxx
Other Notices:
Bank of America, N.A.
Technology #3697
Mail Code: CA5-705-41-01
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
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Agent's Payment Office:
Bank of America, N.A.
0000 Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
Attn: Agency Services--West #5596
Reference: Quantum Corporation (364-Day/1-Year)
For credit to FTA Acct. No. 3750836479
ABA Number: 000-000-000
BANK OF AMERICA, N.A., as Lender
Domestic and Offshore Lending Office:
(Borrowing Notices, Notices of Conversion/Continuation and Payments)
Bank of America, N.A.
Mail Code: CA4-706-05-09
Agency Administrative Services #5596
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Nawaporn Wongbuddhapitak
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxxx.xxxxxxxxxxxxxxx@xxxxxxxxxxxxx.xxx
All other Notices:
Bank of America, N.A.
Technology #3697
Mail Code: CA5-705-41-01
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxxx@xxxxxxxxxxxxx.xxx
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BANQUE NATIONALE DE PARIS
Domestic and Offshore Lending Office:
Banque Nationale de Paris
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxx.xxxx@xxx.xxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Banque Nationale de Paris
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. XxXxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxx.xxxxxxxxxxx@xxx.xxxxxxxx.xxx
THE BANK OF NOVA SCOTIA
Domestic and Offshore Lending Office:
The Bank of Nova Scotia
000 Xxxxxxxxx Xxxxxx X.X., Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxxx@xxxxxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
The Bank of Nova Scotia
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxx@xxxxxxxxxxxxx.xxx
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CITICORP USA, INC.
Domestic and Offshore Lending Office:
Citicorp USA, Inc.
0 Xxxx'x Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxxxxxxx@xxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Citicorp USA, Inc.
Xxx Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxxx@xxxxxxxx.xxx
FLEET NATIONAL BANK
Domestic and Offshore Lending Office:
Fleet National Bank
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx_x_xxxxxxxxx@xxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Fleet National Bank
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Attn: Xxxxxx Xxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxx_x_xxx@xxxxx.xxx
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THE INDUSTRIAL BANK OF JAPAN, LIMITED
Domestic and Offshore Lending Office:
The Industrial Bank of Japan, Limited
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxx@xxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
The Industrial Bank of Japan, Limited
One Market
Spear Street Tower, 1610
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxxx@xxxxx.xxx
KEYBANK NATIONAL ASSOCIATION
Domestic and Offshore Lending Office:
KeyBank National Association
000 Xxxxx Xxxxxxxxxx Xxxx.
Xxxxx, XX 00000
Attn: Xxxxxx Xxxxx/Specialty Services Team
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxxx_xxxxx@xxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
KeyBank National Association
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxx_x_xxxxx@xxxxxxx.xxx
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THE SUMITOMO BANK, LIMITED
Domestic and Offshore Lending Office:
The Sumitomo Bank, Limited
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx_xxxxxxxx@xxxxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
The Sumitomo Bank, Limited
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxx_xxxxxxx@xxxxxxxxxxxx.xxx
UNION BANK OF CALIFORNIA, N.A.
Domestic and Offshore Lending Office:
Union Bank of California, N.A.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxxxxxx@xxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-mail: xxxxx.xxxxxx@xxxx.xxx
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