EXECUTION COPY
CREDIT AGREEMENT
Dated as of February 5, 1999
among
CORDANT TECHNOLOGIES INC.
and
THE FIRST NATIONAL BANK OF CHICAGO,
Individually and As Administrative Agent,
FIRST CHICAGO CAPITAL MARKETS, INC.,
As Arranger,
and
THE LENDING INSTITUTIONS PARTY HERETO
TABLE OF CONTENTS
PAGE
ARTICLE I: DEFINITIONS 1
ARTICLE II: THE CREDITS 10
2.1. Advances 10
2.1.1. Commitments to Make Revolving Loans 10
2.1.2. Ratable Loans 10
2.1.3. Rate Options 11
2.1.4. Method of Selecting Rate Options and Interest Periods for Advances 11
2.1.5. Conversion and Continuation of Outstanding Advances 11
2.2. Term Loan Extension Option. 12
2.2.1. Option 12
2.2.2. Extension Request. 12
2.2.3. Conditions Precedent to Extension 12
2.2.4. Repayment of Term Loans 13
2.2.5. Rate Options 13
2.2.6. Conversion and Continuation of Outstanding Advances
consisting of Term Loans 13
2.3. General Facility Terms 14
2.3.1. Method of Borrowing 14
2.3.2. Minimum Amount of Each Advance 14
2.3.3. Termination; Required Payments 14
2.3.4. Optional Principal Payments 14
2.3.5. Commitment Fees and Voluntary Reduction of Commitments 14
2.3.6. Changes in Interest Rate, etc. 15
2.3.7. Ratings Change Rate Increase; Rate after Maturity 15
2.3.8. Interest Payment Dates; Interest and Fee Basis. 15
2.3.9. Method of Payment 16
2.3.10. Notes; Telephonic Notices 16
2.3.11. Notification of Advances, Interest Rates, Prepayments
and Commitment Reductions 17
2.3.12. Lending Installations 17
2.3.13. Non-Receipt of Funds by the Administrative Agent. 17
2.3.14. Withholding Tax Exemption 18
ARTICLE III: CHANGE IN CIRCUMSTANCES; INDEMNIFICATION 18
3.1. Yield Protection. 18
3.2. Changes in Capital Adequacy Regulations 19
3.3. Availability of Interest Rate. 20
3.4. Failure to Pay or Borrow on Certain Dates 20
3.5. Bank Certificates; Survival of Indemnity 20
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ARTICLE IV: CONDITIONS PRECEDENT 21
4.1. Initial Advance 21
4.2. Each Advance 22
ARTICLE V: REPRESENTATIONS AND WARRANTIES. 22
5.1. Corporate Existence and Standing 22
5.2. Authorization and Validity 22
5.3. Compliance with Laws and Contracts 23
5.4. Financial Statements 23
5.5. Material Adverse Change 23
5.6. Taxes 23
5.7. Litigation 24
5.8. ERISA 24
5.9. Defaults and Prepayment Event 24
5.10. Accuracy of Information 24
5.11. Regulation U. 24
5.12. Pari Passu. 24
5.13. Investment Company 24
5.14. Material Laws. 25
5.15. Material Agreements 25
5.16. Subsidiaries 25
5.17. Ownership of Properties 25
ARTICLE VI: COVENANTS 25
6.1. Affirmative Covenants 25
6.1.1. Financial Reporting 26
6.1.2. Use of Proceeds 27
6.1.3. Notice of Default and Prepayment Event 28
6.1.4. Conduct of Business 28
6.1.5. Payment of Taxes 28
6.1.6. Insurance 28
6.1.7. Compliance with Laws 28
6.1.8. Maintenance of Properties 29
6.1.9. Inspection 29
6.2. Negative Covenants 29
6.2.1. Dividends 29
6.2.2. Indebtedness of Subsidiaries 29
6.2.3. Merger 29
6.2.4. Sale of Assets 30
6.2.5. Sale and Leaseback 30
6.2.6. Liens 30
6.2.7. Funded Debt/EBITDA Ratio 31
ii
6.2.8. Affiliates; Howmet 31
ARTICLE VII: DEFAULTS 32
ARTICLE VIII: ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES 34
8.1. Acceleration; Allocation of Payments after Default or Prepayment Event 34
8.2. Amendments 34
8.3. Preservation of Rights 35
ARTICLE IX: GENERAL PROVISIONS 35
9.1. Survival of Representations 35
9.2. Governmental Regulation 35
9.3. Taxes 35
9.4. CHOICE OF LAW 36
9.5. CONSENT TO JURISDICTION 36
9.6. WAIVER OF JURY TRIAL 36
9.7. Headings 36
9.8. Entire Agreement 36
9.9. Several Obligations 36
9.10. Expenses. 37
9.12. Numbers of Documents 37
9.13. Confidentiality 37
ARTICLE X: THE ADMINISTRATIVE AGENT 38
10.1. Appointment 38
10.2. Powers 38
10.3. General Immunity 38
10.4. No Responsibility for Loans, Recitals, etc 38
10.5. Right to Indemnity 38
10.6. Action on Instructions of Banks 38
10.7. Employment of Agents and Counsel. 38
10.8. Reliance on Documents; Counsel. 39
10.9. Administrative Agent's Reimbursement 39
10.10. Rights as a Bank 39
10.11. Bank Credit Decision. 39
10.12. Successor Administrative Agent 39
10.13. Distribution of Information 40
10.14. Disclosure 40
ARTICLE XI: SETOFF; RATABLE PAYMENTS 41
11.1. Setoff 41
11.2. Ratable Payments 41
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ARTICLE XII: BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS 41
12.1. Successors and Assigns 41
12.2. Participations 42
12.2.1. Permitted Participants; Effect 42
12.2.2. Voting Rights 42
12.3. Assignments. 42
12.3.1. Permitted Assignments 42
12.3.2. Substitution of Bank 43
12.3.3. Effect; Effective Date 43
12.4. Dissemination of Information 44
12.5. Tax Treatment 44
ARTICLE XIII: NOTICES 44
13.1. Giving Notice 44
13.2. Change of Address 44
ARTICLE XIV: COUNTERPARTS 45
EXHIBIT "A":EXTENSION REQUEST 48
EXHIBIT "B": FORM OF PROMISSORY NOTE 49
EXHIBIT "C": OPINION OF COUNSEL 51
EXHIBIT "D": LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION 54
EXHIBIT "E": ASSIGNMENT AGREEMENT 55
SCHEDULE "1": SUBSIDIARIES 65
SCHEDULE "2": INDEBTEDNESS OF SUBSIDIARIES 66
SCHEDULE "3": LIENS 67
iv
CORDANT TECHNOLOGIES INC.
CREDIT AGREEMENT
This Credit Agreement dated as of February 5, 1999 is among Cordant
Technologies Inc., a Delaware corporation, each of the undersigned banks
and The First National Bank of Chicago, individually and as agent for such
banks. The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Advance" means a borrowing hereunder consisting of the aggregate
amount of the several Loans made by the Banks to the Company at the same
time, at the same Rate Option and for the same Interest Period. Unless the
context otherwise expressly states otherwise, from and after the Revolving
Credit Termination Date if the Revolving Loans shall have been converted to
Term Loans, "Advance" shall mean the borrowings consisting of the aggregate
amount of the several Term Loans.
"Administrative Agent" means The First National Bank of Chicago in its
capacity as agent for the Banks pursuant to Article X, and not in its
individual capacity as a Bank, and any successor Administrative Agent
appointed pursuant to Article X.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such
Person. A Person shall be deemed to control another Person if the
controlling Person owns 10% or more of any class of voting securities (or
other ownership interests) of the controlled Person or possesses, directly
or indirectly, the power to direct or cause the direction of the management
or policies of the controlled Person, whether through ownership of stock,
by contract or otherwise.
"Aggregate Available Commitment" means, at any time prior to the
Revolving Credit Termination Date, the Aggregate Commitment at such time
less the Outstandings at such time.
"Aggregate Commitment" means the aggregate of the Commitments of all
the Banks hereunder.
"Aggregate Outstanding Credit Exposure" means, as of any day, the
aggregate of the Outstanding Credit Exposure of all the Banks.
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"Agreement" means this credit agreement, as it may be amended from
time to time.
"Arranger" means First Chicago Capital Markets, Inc.
"Article" means an article of this Agreement unless another document
is specifically referenced.
"Authorized Representative" means the Chief Financial Officer or
the Treasurer of the Company or any other officer or employee of the
Company designated in writing as an "Authorized Representative" under this
Agreement by the Chief Financial Officer or the Treasurer of the Company.
"Bankruptcy Code" means Xxxxx 00, Xxxxxx Xxxxxx Code Sections 1 ET
SEQ., as the same may be amended from time to time, and any successor
thereto or replacement therefor which may be hereafter enacted.
"Banks" means the banks listed on the signature pages of this
Agreement and their respective successors and assigns.
"Base Eurodollar Rate" means, with respect to a Eurodollar Rate
Advance for the relevant Interest Period, the rate determined by the
Administrative Agent to be the rate at which deposits in U.S. Dollars are
offered by First Chicago to first-class banks in the London interbank
market at approximately 11 a.m. (London time) two Business Days prior to
the first day of such Interest Period, in the approximate amount of First
Chicago's relevant Eurodollar Rate Loan and having a maturity approximately
equal to such Interest Period.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.1.4.
"Business Day" means (a) with respect to borrowing, payment or rate
selection of Eurodollar Rate Advances, a day (other than a Saturday or
Sunday) on which banks generally are open for business in Chicago and New
York for the conduct of substantially all of their commercial lending
activities and on which dealings in U.S. Dollars are carried on in the
London interbank market and (b) for all other purposes, a day (other than a
Saturday or Sunday) on which banks generally are open for business in
Chicago and New York for the conduct of substantially all of their
commercial lending activities.
"Capitalized Lease" of any Person means any lease or lease agreement
which creates a Capitalized Lease Obligation of such Person.
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"Capitalized Lease Obligation" of any Person means the obligation of
such Person, as lessee, to pay rent for the letting, use or hire of real or
personal property which in accordance with GAAP is required to be presented
on the balance sheet of such Person as a liability.
"Commitment" means, for each Bank, the obligation of the Bank to make
Loans not exceeding the amount set forth opposite its signature below, as
such amount may be modified from time to time.
"Company" means Cordant Technologies Inc., a Delaware corporation.
"Consolidated EBITDA" means, for any period, Consolidated Net Income
PLUS interest expense and provision for taxes based on income (in each case
to the extent deducted in determining Consolidated Net Income), adjusted by
adding thereto the amount of (i) all amortization of intangibles and
depreciation and (ii) Receivables Facility Financing Costs (to the extent
not otherwise included).
"Consolidated Funded Debt" means all Indebtedness of the Company and
its Consolidated Subsidiaries which, on the date of determination, would be
required to be shown on the Company's consolidated balance sheet prepared
in accordance with GAAP, PLUS all Receivables Facility Attributed
Indebtedness of the Company and its Consolidated Subsidiaries on the date
of determination regardless of its treatment under GAAP.
"Consolidated Net Income" means, for any period, the consolidated net
after-tax income of the Company and its Consolidated Subsidiaries
determined in accordance with GAAP.
"Consolidated Subsidiary" means any Subsidiary that is consolidated on
a balance sheet of the Company in accordance with GAAP; PROVIDED, THAT,
notwithstanding anything in this Agreement to the contrary, for purposes of
the definitions of Consolidated EBITDA, Consolidated Funded Debt,
Consolidated Net Income and all components of each of the foregoing, Howmet
and its Subsidiaries shall be included as Consolidated Subsidiaries of the
Company.
"Consolidated Total Assets" means, as at any date of determination,
the aggregate value of assets of the Company and its Consolidated
Subsidiaries determined in accordance with GAAP.
"Conversion/Continuation Notice" is defined in Section 2.1.5.
"Corporate Base Rate" means a rate per annum equal to the corporate
base rate of interest announced by First Chicago from time to time,
changing when and as said corporate base rate changes.
"Default" means an event described in Article VII.
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"Dollars" and "$" mean lawful money of the United States of America.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Effective Date" means any Business Day on which the Company has
complied with all of the terms and conditions of Section 4.1, the Company
has paid all requisite fees to the Administrative Agent, the Company, the
Administrative Agent and the Banks have executed this Agreement, and the
Administrative Agent has notified the Company and the Banks that all such
events have occurred.
"Eurodollar Margin" means (a) for the period from the Effective Date
until the date that is 180 days thereafter, 0.875% per annum; (b) for the
period beginning 181 days after the Effective Date until the Revolving
Credit Termination Date, 1.0% per annum; and (c) from and after the
Revolving Credit Termination Date, 1.25% per annum.
"Eurodollar Rate" means, with respect to a Eurodollar Rate Advance for
the relevant Interest Period, a per annum rate equal to the sum of (a) the
quotient of (i) the Base Eurodollar Rate applicable to that Interest
Period, divided by (ii) one minus the Reserve Requirement (expressed as a
decimal) applicable to that Interest Period, if any, plus (b) the
Eurodollar Margin, changing when and as said Eurodollar Margin changes. The
Eurodollar Rate shall be rounded, if necessary, to the next higher 1/100th
of 1%.
"Eurodollar Rate Advance" means an Advance which bears interest at a
Eurodollar Rate.
"Eurodollar Rate Loan" means a Loan which bears interest at a
Eurodollar Rate.
"Extension Request" means a notice in substantially the form of
Exhibit "A" hereto, with appropriate insertions, duly executed and
delivered to the Administrative Agent by the Company.
"Federal Funds Rate" means, for any day, an interest rate per annum
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 for such day (or, if such day is
not a Business Day, for the immediately preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for
any day which is a Business Day, the average of the quotations at
approximately 10 a.m. (Chicago time) on such day on such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by the Administrative Agent in its sole
discretion.
"First Chicago" means The First National Bank of Chicago in its
individual capacity and not as agent hereunder.
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"Floating Rate" means, for any day, a rate per annum equal to the
higher of (a) the Corporate Base Rate for such day and (b) the Federal
Funds Rate for such day plus .5% per annum.
"Floating Rate Advance" means an Advance which bears interest at the
Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"Funded Debt/EBITDA Ratio" means, as at the last day of any fiscal
quarter of the Company, the ratio of (i) Consolidated Funded Debt as of
such day to (ii) Consolidated EBITDA for the four consecutive fiscal
quarters ending on such day.
"GAAP" means generally accepted principles of accounting as in effect
at the time of application to the provisions hereof, except as provided
with regard to Howmet pursuant to the definition of "Subsidiary" set forth
herein.
"Guaranty" of any Person means any agreement by which such Person
assumes, guarantees, endorses, contingently agrees to purchase or provide
funds for the payment of, or otherwise becomes liable upon, the obligation
of any other Person, or agrees to maintain the net worth or working capital
or other financial condition of any other Person or otherwise assure any
creditor of such other Person against loss, and shall include, without
limitation, the contingent liability of such Person under or with respect
to any Letter of Credit.
"Howmet" means Howmet International, Inc., a Delaware corporation.
"Indebtedness" of any Person means, without duplication, (a) the
obligations of such Person (i) for borrowed money, (ii) under or with
respect to notes payable and drafts accepted which represent extensions of
credit (whether or not representing obligations for borrowed money) to such
Person or (iii) reimbursement obligations with respect to letters of credit
issued for the account of such Person or (iv) for the deferred purchase
price of property or services other than current accounts payable arising
in the ordinary course of business on terms customary in the trade, (b) the
obligations of others, whether or not assumed, secured by Liens on property
of such Person or payable out of the proceeds of or production from
property now or hereafter owned or acquired by such Person, (c) the
Capitalized Lease Obligations of such Person, (d) the obligations of such
Person under Guaranties by such Person of any Indebtedness (other than
obligations for borrowed money incurred to finance the purchase of property
leased to such Person pursuant to a Capitalized Lease of such Person) of
any other Person, (e) all Receivables Facility Attributed Indebtedness of
such Person on the date of determination and (f) Off Balance Sheet
Liabilities of such Person.
"Interest Period" means, with respect to a Eurodollar Rate Advance, a
period of one, two, three or six months commencing on a Business Day
selected by the Company pursuant to this Agreement. Such Interest Period
shall end on the day in the succeeding calendar month which
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corresponds numerically to the beginning day of such Interest Period;
PROVIDED, HOWEVER, that if there is no such numerically corresponding day
in such succeeding month, such Interest Period shall end on the last
Business Day of such succeeding month. If an Interest Period would
otherwise end on a day which is not a Business Day, such Interest Period
shall end on the next succeeding Business Day; PROVIDED, HOWEVER, that if
said next succeeding Business Day falls in a new month, such Interest
Period shall end on the immediately preceding Business Day.
"Lending Installation" means, for each type of Loan, any office,
branch, subsidiary or affiliate of any Bank.
"Letter of Credit" of any Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon
which such Person is account party or for which such Person is in any way
liable.
"Lien" means, with respect to the property of any Person, any security
interest, mortgage, pledge, lien, claim, charge, encumbrance, conditional
sale agreement, title retention agreement, lessor's interest under a
Capitalized Lease or analogous instrument, in, of or on any of the property
of such Person.
"Loan" means, with respect to a Bank, such Bank's portion of any
Advance or, during the Term Loan Period, such Bank's Term Loan.
"Loan Documents" means this Agreement and the Notes.
"Note" means a promissory note in substantially the form of Exhibit
"B" hereto, with appropriate insertions, duly executed and delivered to the
Administrative Agent by the Company and payable to the order of a Bank in
the amount of its Commitment, including any amendment, modification,
renewal or replacement of such promissory note.
"Obligations" means all unpaid principal and accrued and unpaid
interest under the Notes, all accrued and unpaid commitment and extension
fees and all other obligations of the Company or any Subsidiary to the
Banks or to any Bank or the Administrative Agent arising under the Loan
Documents.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any sale and
leaseback transaction which does not create a liability on the balance
sheet of such Person, (iii) any liability under any financing lease or
so-called "synthetic lease" transaction entered into by such Person, or
(iv) any obligation arising with respect to any other transaction which is
the functional equivalent of or takes the place of borrowing but which does
not constitute a liability on the balance sheets of such Person, but
excluding Operating Leases.
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"Operating Lease" of a Person means any lease of Property (other than
a Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option
of the lessor) of one year or more.
"Outstanding Credit Exposure" means, as to any Bank at any time, the
aggregate principal amount of its Loans outstanding at such time .
"Outstandings" means at any time the aggregate of the principal amounts of
all outstanding Advances.
"Participants" is defined in Section 12.2.1.
"Payment Date" shall mean the last Business Day of each quarter,
commencing March 31, 1999.
"Permitted Lien" means any lien described in clauses (a) through (i)
of Section 6.2.6.
"Person" means any corporation, natural person, firm, joint venture,
partnership, trust, unincorporated organization, government or any
department or agency of any government.
"Plan" means a defined benefit pension plan as such term is defined in
Section 3(35) of ERISA for the unfunded liabilities of which upon
termination the Company or any Subsidiary could be held liable by the
Pension Benefit Guaranty Corporation.
"Plan Year" means a plan year as defined in Section 3(39) of ERISA.
"Prepayment Event" means the earliest to occur of (a) the date of a
public announcement that a Person or group of affiliated or associated
Persons (an "Acquiring Person") has acquired, or has obtained the right to
acquire, legal or beneficial ownership of more than 50% of the outstanding
shares of the Voting Stock of the Company, (b) the date of the commencement
of a tender offer or exchange offer that would result in an Acquiring
Person legally or beneficially owning more than 50% of the outstanding
shares of the Voting Stock of the Company, and (c) the date an Acquiring
Person acquires all or substantially all of the assets of the Company.
"Rate Option" means the Eurodollar Rate or the Floating Rate.
"Receivables Facility Attributed Indebtedness" means the amount of
obligations outstanding under a receivables purchase facility on any date
of determination that would be characterized as principal if such facility
were structured as a secured lending transaction rather than as a purchase.
"Receivables Facility Financing Costs" means all cash fees, service
charges, and other costs, as well as all collections or other amounts
retained by purchasers of receivables pursuant to
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a receivables purchase facility, which are in excess of amounts paid to the
Company and its Consolidated Subsidiaries under any receivables purchase
facility for the purchase of receivables pursuant to such facility.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System from time to time in effect and shall include any
successor or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of
the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System from time to time in effect and shall include any
successor or other regulation or official interpretation of said Board of
Governors relating to the extension of credit by banks for the purpose of
purchasing or carrying margin stocks applicable to member banks of the
Federal Reserve System.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA.
"Required Banks" means Banks in the aggregate having at least 51% of
the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, Banks in the aggregate holding at least 51% of the Aggregate
Outstanding Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on
Eurocurrency liabilities.
"Revolving Credit Termination Balance" means the aggregate principal
amount of Advances outstanding on the Revolving Credit Termination Date
after giving effect to any Advances made or repaid on such date.
"Revolving Credit Termination Date" means November 5, 1999 or any
earlier date on which the Aggregate Commitment is reduced to zero or
otherwise terminated pursuant to the terms hereof.
"Revolving Loan" is defined in Section 2.1.1.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Security" shall have the same meaning as in Section 2(1) of the
Securities Act of 1933, as amended.
"Stock Acquisition" means the acquisition by the Company of all
outstanding shares of capital stock of Howmet owned by The Carlyle Group
for an aggregate purchase price not to
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exceed the amount set forth in the disclosure letter dated of even date
herewith from the Company to the Agent and the Banks.
"Subsidiary" of a Person means (i) any corporation more than 50% of
the outstanding securities having ordinary voting power of which shall at
the time be owned or controlled, directly or indirectly, by such Person or
by one or more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (ii) any partnership, association, joint venture, limited
liability company or similar business organization more than 50% of the
ownership interests having ordinary voting power of which shall at the time
be so owned or controlled. Unless otherwise expressly provided, all
references herein to a "Subsidiary" shall mean a Subsidiary of the Company,
PROVIDED THAT, except for the limited purposes as set forth in the
definition of Consolidated Subsidiary, Howmet shall not be deemed a
Subsidiary of the Company for any purposes under this Agreement.
"Term Loan" is defined in Section 2.2.1.
"Term Loan Period" means the period from the Revolving Credit
Termination Date to the date that is nine-months after the Revolving Credit
Termination Date.
"Termination Date" means (1) (a) if the conversion of the Revolving
Credit Termination Balance to Term Loans does not occur, the Revolving
Credit Termination Date or (b) if the conversion of the Revolving Credit
Termination Balance to Term Loans occurs, the date that is nine months
after the Revolving Credit Termination Date, or (2) any earlier date on
which the Commitments are canceled by the Company or otherwise terminated
pursuant to this Agreement.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or Eurodollar Rate Advance.
"Unfunded Liabilities" means the amount (if any) by which the excesses
of the accumulated benefit obligations as determined under Financial
Accounting Standard Board Statement 87 exceeds the fair value of all such
Plan assets allocable to such benefits, as reported each year in the
Company's Annual Report to Stockholders.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Voting Stock" means Securities of any class or classes, the holders
of which are ordinarily, in the absence of contingencies, entitled to elect
the corporate directors (or Persons performing similar functions).
Page 9
"Wholly-Owned Subsidiary" means any Subsidiary of which all of the
outstanding voting securities or ownership interests having ordinary voting
power are owned or controlled, directly or indirectly, by the Company or
one or more Wholly-Owned Subsidiaries, or by the Company and one or more
Wholly-Owned Subsidiaries, or any similar business organization which is so
owned or controlled.
"Year 2000 Issues" means anticipated costs, problems and uncertainties
associated with the inability of certain computer applications to
effectively handle data including dates on and after January 1, 2000, as
such inability affects the business, operations and financial condition of
the Company and its Subsidiaries and of the Company's and its Subsidiaries'
material customers, suppliers and vendors.
"Year 2000 Program" is defined in Section 5.19.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. ADVANCES.
2.1.1. COMMITMENTS TO MAKE REVOLVING LOANS. From and including the
Effective Date and prior to the Revolving Credit Termination Date, each
Bank severally agrees, on the terms and conditions set forth in this
Agreement, to make loans (individually a "Revolving Loan" and collectively
the "Revolving Loans") to the Company from time to time in amounts not to
exceed in the aggregate at any one time outstanding the amount of its
Commitment, PROVIDED that in no event may the Outstandings at any one time
exceed the Aggregate Commitment as in effect at such time. Subject to the
terms of this Agreement, the Company may borrow, repay and reborrow at any
time prior to the Revolving Credit Termination Date. Subject to the terms
and conditions set forth in Section 2.2 and at the option of the Borrower,
the Revolving Loans outstanding as of the Revolving Credit Termination Date
shall be converted to Term Loans and shall be repaid in accordance with the
terms of Section 2.2.
2.1.2. RATABLE LOANS. Each Advance hereunder shall consist of
Revolving Loans made from the several Banks ratably in proportion to the
ratios that their respective Commitments bear to the Aggregate Commitment.
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2.1.3. RATE OPTIONS. The Advances may be Floating Rate Advances or
Eurodollar Rate Advances, or a combination thereof, selected by the Company
in accordance with Sections 2.1.4 and 2.1.5; PROVIDED that there shall be
no more than ten (10) Interest Periods in effect with respect to all of the
Loans at any time.
2.1.4. METHOD OF SELECTING RATE OPTIONS AND INTEREST PERIODS FOR
ADVANCES. The Company shall select the Rate Options and Interest Periods
applicable to each Advance from time to time. The Company shall give the
Administrative Agent irrevocable notice (a "Borrowing Notice") not later
than 10:00 a.m. Chicago time on the Borrowing Date of each Floating Rate
Advance and at least three Business Days before the Borrowing Date for each
Eurodollar Rate Advance, specifying:
(a) the Borrowing Date, which shall be a Business Day, of such
Advance,
(b) the aggregate amount of such Advance, which shall be less than or
equal to the Aggregate Available Commitment,
(c) the Rate Option selected for such Advance, and
(d) in the case of each Eurodollar Rate Advance, the Interest Period
applicable thereto.
2.1.5. CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES. Floating
Rate Advances shall continue as Floating Rate Advances unless and until
such Floating Rate Advances are converted into Eurodollar Rate Advances.
Each Eurodollar Rate Advance shall continue as a Eurodollar Rate Advance
until the end of the then applicable Interest Period therefor, at which
time such Eurodollar Rate Advance shall be automatically converted into a
Floating Rate Advance unless the Company shall have given the
Administrative Agent a Conversion/Continuation Notice requesting that, at
the end of such Interest Period, such Eurodollar Rate Advance continue as a
Eurodollar Rate Advance for the same or another Interest Period. Subject to
the terms of Section 2.3.2, the Company may elect from time to time to
convert all or any part of an Advance of any Type into any other Type or
Types of Advances; provided that (i) any conversion of any Eurodollar Rate
Advance shall be made on, and only on, the last day of the Interest Period
applicable thereto, and (ii) no Advance may be continued as or converted
into a Eurodollar Rate Advance at such times as a Default or Unmatured
Default has occurred and is continuing. The Company shall give the
Administrative Agent irrevocable notice (a "Conversion/Continuation
Notice") of each conversion of an Advance or continuation of a Eurodollar
Rate Advance not later than 10:00 a.m. Chicago time on the date of the
requested conversion into a Floating Rate Advance and at least three
Business Days, in the case of a conversion into or continuation of a
Eurodollar Advance, prior to the date of the requested conversion or
continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
Page 11
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued; and
(iii)the amount and Type(s) of Advance(s) into which such Advance is
to be converted or continued and, in the case of a conversion
into or continuation of a Eurodollar Rate Advance, the duration
of the Interest Period applicable thereto.
2.2. TERM LOAN EXTENSION OPTION.
2.2.1. OPTION. During the period that is not less than 5 Business Days
prior to the Revolving Credit Termination Date and that is not greater than
30 days prior to the Revolving Credit Termination Date, the Company may
request the Banks to convert the Revolving Loans outstanding on the
Revolving Credit Termination Date into term loans (individually, a "Term
Loan" and, collectively, the "Term Loans") and, subject to the terms and
conditions contained in this Section 2.2, the Revolving Credit Termination
Balance will be converted on the Revolving Credit Termination Date into
Term Loans.
2.2.2. EXTENSION REQUEST. When the Company wishes to request
conversion of the Revolving Loans into Term Loans, it shall transmit to the
Administrative Agent by telecopy or telefacsimile an Extension Request so
as to be received no later than noon Chicago time at least five (5)
Business Days prior to the Revolving Credit Termination Date. Promptly upon
receipt of an Extension Request, the Administrative Agent shall send to the
Banks by telecopy or telefacsimile a copy of such Extension Request.
2.2.3. CONDITIONS PRECEDENT TO EXTENSION. No Bank shall be required to
convert its Revolving Loans to Term Loans on the Revolving Credit
Termination Date unless:
(a) An Extension Request shall have been delivered to the
Administrative Agent in accordance with the terms of Section 2.2;
(b) No Default or Unmatured Default shall have occurred and be
continuing under Section 7.2, 7.3, 7.6, 7.7, 7.8 or 7.11;
(c) No Prepayment Event has occurred;
(d) On or prior to the Revolving Credit Termination Date, the Company
has paid to the Administrative Agent an extension fee in the
amount of .10% of the Revolving Credit Termination Balance for
the ratable benefit of the Banks and any other fees due and owing
to the Administrative Agent and the Banks as at the Revolving
Credit Termination Date.
Page 12
Submission by the Company of an Extension Request shall constitute a
representation and warranty by the Company that the conditions contained in
Section 2.2.3 have been satisfied. If the conditions precedent to
conversion contained in this Section 2.2.3 have not been satisfied or
waived, the Revolving Loans shall be due payable on the Revolving Credit
Termination Date.
2.2.4. REPAYMENT OF TERM LOANS. The outstanding principal balance of
each Term Loan shall be paid in full by the Company on the Termination
Date. Amounts repaid with respect to the Term Loans may not be reborrowed.
2.2.5. RATE OPTIONS. The Revolving Loans converted to Term Loans on
the Revolving Credit Termination Date shall initially continue as the Type
or Types of Advances, with the Interest Periods then applicable as are
outstanding on the Revolving Credit Termination Date and shall be continued
as or converted into Floating Rate Advances or Eurodollar Rate Advances, or
a combination thereof, selected by the Company in accordance with Sections
2.2.6.
2.2.6. CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES CONSISTING
OF TERM LOANS. Floating Rate Advances shall continue as Floating Rate
Advances unless and until such Floating Rate Advances are converted into
Eurodollar Rate Advances. Each Eurodollar Rate Advance shall continue as a
Eurodollar Rate Advance until the end of the then applicable Interest
Period therefor, at which time such Eurodollar Rate Advance shall be
automatically converted into a Floating Rate Advance unless the Company
shall have given the Administrative Agent a Conversion/Continuation Notice
requesting that, at the end of such Interest Period, such Eurodollar Rate
Advance continue as a Eurodollar Rate Advance for the same or another
Interest Period. Subject to the terms of Section 2.3.2, the Company may
elect from time to time to convert all or any part of an Advance of any
Type into any other Type or Types of Advances; provided that (i) any
conversion of any Eurodollar Rate Advance shall be made on, and only on,
the last day of the Interest Period applicable thereto, and (ii) no Advance
may be continued as or converted into a Eurodollar Rate Advance at such
times as a Default or Unmatured Default has occurred and is continuing. The
Company shall give the Administrative Agent a Conversion/Continuation
Notice of each conversion of an Advance or continuation of a Eurodollar
Rate Advance not later than 10:00 a.m. Chicago time on the date of the
requested conversion into a Floating Rate Advance and at least three
Business Days, in the case of a conversion into or continuation of a
Eurodollar Advance, prior to the date of the requested conversion or
continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued; and
(iii)the amount and Type(s) of Advance(s) into which such Advance is
to be converted or continued and, in the case of a conversion
into or continuation of a Eurodollar Rate Advance, the duration
of the Interest Period applicable thereto.
2.3. GENERAL FACILITY TERMS.
2.3.1. METHOD OF BORROWING. Not later than 1:00 p.m. Chicago time on
each Borrowing Date, each Bank shall make available its Loan or Loans in
funds immediately available in Chicago, to the Administrative Agent at its
address specified pursuant to Article XII. The Administrative Agent will
make the funds so received from the Banks available to the Company at the
Administrative Agent's aforesaid address. Notwithstanding the foregoing
provisions of this Section 2.3.1 but subject to Section 2.1.5, to the
extent that a Loan made by a Bank matures on the Borrowing Date of a
requested Loan, such Bank shall first apply the proceeds of the Loan it is
then making to the repayment of the maturing Loan.
Page 13
2.3.2. MINIMUM AMOUNT OF EACH ADVANCE. Each Advance shall be in the
minimum amount of $5,000,000 (and in integral multiples of $1,000,000 if in
excess thereof), PROVIDED, HOWEVER, that any Floating Rate Advance may be
in the aggregate amount of the Aggregate Available Commitment.
2.3.3. TERMINATION; REQUIRED PAYMENTS. The Commitments to lend
hereunder shall expire on the Revolving Credit Termination Date. Unless
converted to Term Loans in accordance with the provisions of Section 2.2,
any outstanding Revolving Loans and all other unpaid Obligations (other
than the Term Loans) shall be paid in full by the Company on the Revolving
Credit Termination Date or, at the election of the Required Banks in
accordance with Section 8.1, upon the occurrence of a Prepayment Event. Any
outstanding Term Loans and all other unpaid Obligations shall be paid in
full by the Company on the Termination Date or, at the election of the
Required Banks in accordance with Section 8.1, upon the occurrence of a
Prepayment Event.
2.3.4. OPTIONAL PRINCIPAL PAYMENTS. The Company may from time to time
pay all outstanding Floating Rate Advances, or, in a minimum aggregate
amount of $5,000,000, or any integral multiple of $1,000,000 in excess
thereof, any portion of the outstanding Floating Rate Advances upon one
Business Day's prior notice to the Administrative Agent without penalty or
premium. A Eurodollar Rate Advance may be paid prior to the last day of the
applicable Interest Period upon three Business Days' prior notice to the
Administrative Agent; PROVIDED, HOWEVER, that the Company shall indemnify
each Bank for any loss or cost incurred by it resulting therefrom in
accordance with Section 3.4.
2.3.5. COMMITMENT FEES AND VOLUNTARY REDUCTION OF COMMITMENTS.
(a) The Company agrees to pay to the Administrative Agent
for the account of each Bank a commitment fee payable on the
average daily unborrowed portion of such Bank's Commitment from
the Effective Date to but not including the Revolving Credit
Termination Date, equal to .15% per annum, such fee payable in
arrears on each Payment Date hereafter and on the Revolving
Credit Termination Date.
(b) The Company may permanently reduce the Aggregate
Commitment in whole, or in part ratably among the Banks in
integral multiples of $5,000,000, upon at least three Business
Days' written notice to the Administrative Agent, which shall be
irrevocable and shall specify the amount of any such reduction;
PROVIDED, HOWEVER, that the amount of the Aggregate Commitment
may not be reduced below the Outstandings at the time such
reduction is to take effect. All accrued commitment fees shall be
payable on the effective date of any termination of the
obligations of the Banks to make Revolving Loans hereunder.
Page 14
2.3.6. CHANGES IN INTEREST RATE, ETC. Each Floating Rate Advance shall
bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is converted from a
Eurodollar Rate Advance into a Floating Rate Advance pursuant to Section
2.1.5 or Section 2.2.6 to but excluding the date it becomes due or is
converted into a Eurodollar Rate Advance pursuant to Section 2.1.5 or
Section 2.2.6 hereof, at a rate per annum equal to the Floating Rate for
such day. Changes in the rate of interest on that portion of any Advance
maintained as a Floating Rate Advance will take effect simultaneously with
each change in the Floating Rate. Each Eurodollar Rate Advance shall bear
interest from and including the first day of the Interest Period applicable
thereto to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Rate Advance.
Prior to the Revolving Credit Termination Date, no Interest Period may end
after the Revolving Credit Termination Date. In the event the Revolving
Loans are converted to Term Loans in accordance with the terms of Section
2.2, thereafter no Interest Period may end after the Termination Date.
2.3.7. RATINGS CHANGE RATE INCREASE; RATE AFTER MATURITY.
2.3.7.1. RATE INCREASE WITH RATINGS CHANGE. If at any time the
Company's senior unsecured debt rating is below BBB- as determined by
Standard and Poor's Ratings Group (or its successors or assigns) or
below Baa3 as determined by Xxxxx'x Investors Service (or its
successors and assigns), the interest rates applicable to the Loans
shall automatically be increased by 0.25% per annum.
2.3.7.2. RATE AFTER MATURITY. Except as provided in the next
sentence, any Advance not paid at maturity, whether by acceleration or
otherwise, shall bear interest until paid in full at a rate per annum
equal to the Floating Rate plus 2% per annum. In the case of a
Eurodollar Rate Advance the maturity of which is accelerated pursuant
to Section 8.1, such Eurodollar Rate Advance shall bear interest until
paid in full for the remainder of the applicable Interest Period at
the rate otherwise applicable to such Interest Period plus 2% per
annum and thereafter at the Floating Rate plus 2% per annum.
2.3.8. INTEREST PAYMENT DATES; INTEREST AND FEE BASIS. Interest
accrued on each Floating Rate Advance shall be payable on each Payment
Date, on any date on which the Floating Rate Advance is prepaid, whether
due to acceleration or otherwise, and at maturity. Interest accrued on each
Eurodollar Rate Advance shall be payable on the last day of its applicable
Interest Period and on any date on which such Advance is prepaid, whether
due to acceleration or otherwise. Interest accrued on each Eurodollar Rate
Advance having an Interest Period longer than three months shall also be
payable on the last day of each three-month interval during such Interest
Period. Interest on Eurodollar Rate Advances and commitment fees shall be
calculated for the actual number of days elapsed on the basis of a year
consisting of 360 days. Interest on Floating Rate Advances shall be
calculated for the actual number of days elapsed on the basis of a year
consisting of 365, or when appropriate 366, days. Interest shall be payable
for the day an Advance is made but not for the day of any payment on the
amount paid if payment is received prior to 1:00 p.m. (Chicago time) at the
place of payment. In the event any such payment is made with the proceeds
of an Advance, such payment shall be deemed to have been
Page 15
made prior to 1:00 p.m. (Chicago time) on the day such Advance is made. If
any payment of principal of or interest on an Advance or any payment of
fees shall become due on a day which is not a Business Day, such payment
shall be made on the next succeeding Business Day and, in the case of a
principal payment or a payment of fees, such extension of time shall be
included in computing interest in connection with such principal payment or
in computing the amount of such payment of fees, as the case may be.
2.3.9. METHOD OF PAYMENT. All payments of principal, interest, and
fees hereunder shall be made in immediately available funds to the
Administrative Agent at the Administrative Agent's address specified
pursuant to Article XIII or at any other Lending Installation of the
Administrative Agent specified in writing by the Administrative Agent to
the Company by noon (local time) on the date when due. Subject to Section
8.1(b), each such payment shall be applied to any Advances and other
amounts then due in accordance with the written instructions from the
Company to the Administrative Agent before or accompanying such payment and
shall be applied ratably among those Banks for whom any payment is then due
in proportion to the type of Advance or other payment then due. Each
payment delivered to the Administrative Agent for the account of any Bank
shall be delivered promptly by the Administrative Agent to such Bank in the
same type of funds which the Administrative Agent received at its address
specified pursuant to Article XIII or at any Lending Installation specified
in a notice received by the Administrative Agent from such Bank. The
Administrative Agent is hereby authorized to charge the account of the
Company at the office of the Administrative Agent for each payment of
principal, interest and fees as it becomes due hereunder.
2.3.10. NOTES; TELEPHONIC NOTICES. The Loans shall be evidenced by the
Notes. Each Bank is hereby authorized to record on the schedule attached to
its Notes, or otherwise record in accordance with its usual practice, the
date and amount of each of its Loans of the type evidenced by such Note;
PROVIDED, HOWEVER, that any failure to so record shall not affect the
Company's obligations under any Note. The Company hereby authorizes the
Banks and the Administrative Agent to extend Advances and effect Rate
Option selections based on telephonic notices made by any person or persons
the Administrative Agent or any Bank in good faith believes to be an
Authorized Representative acting on behalf of the Company. The Company
agrees to deliver promptly to the Administrative Agent a written
confirmation of each telephonic notice signed by
Page 16
an Authorized Representative. If the written confirmation differs in any
material respect from the action taken by the Administrative Agent and the
Banks, the records of the Administrative Agent and the Banks shall govern
absent demonstrable error.
2.3.11. NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND
COMMITMENT REDUCTIONS. Promptly after receipt thereof, the Administrative
Agent will notify each Bank of the contents of each commitment reduction
notice, Borrowing Notice, Conversion/Continuation Notice, Extension Request
and repayment notice received by it hereunder. The Administrative Agent
will notify each Bank of the interest rate applicable to each Eurodollar
Rate Advance promptly upon determination of such interest rate and will
give each Bank prompt notice of each change in the Corporate Base Rate.
2.3.12. LENDING INSTALLATIONS. Each Bank may book the Loans at any
Lending Installation selected by the Bank and may change the Lending
Installation from time to time. All terms of this Agreement shall apply to
any such Lending Installation and the Notes shall be deemed held by each
Bank for the benefit of such Lending Installation. Each Bank may, by
written notice to the Administrative Agent and the Company, designate a
Lending Installation through which Loans are made by it and for whose
account Loan payments are to be made. Each Bank shall use its best efforts
to minimize any additional cost (if any) to the Company, under Section 3.3
or otherwise, as a result of a change of Lending Installation (including,
if appropriate, a return to a prior Lending Installation at such time as
the circumstances giving rise to a change of Lending Installation are no
longer in effect), but no Bank shall be required to take or omit to take
any action which action or omission would be economically or legally
disadvantageous to such Bank. In the event that any Bank has booked its
outstanding Eurodollar Rate Loans at such a designated Lending
Installation, the Company hereby agrees, upon the written request of such
Bank and receipt of such Bank's applicable Note, to execute and deliver to
such Bank for the account of such Bank's existing Lending Installation and
the account of such designated Lending Installation, respectively, both:
(i) as the case may be, a new Note which shall exclusively evidence all of
such Bank's Floating Rate Loans then and thereafter outstanding and (ii) as
the case may be, a new Note which shall exclusively evidence all of such
Bank's Eurodollar Rate Loans then and thereafter outstanding, each of said
new Notes to be in substantially the form of Exhibit "B" hereto with such
appropriate changes in either case as may be agreed to by such Bank, the
Company and the Administrative Agent and each of their respective legal
counsel. Upon such Bank's receipt of its new Notes, it is hereby authorized
and instructed by the Company to record on the respective schedules
attached thereto all of such Bank's Loans then outstanding of the type
evidenced by each such Note.
2.3.13. NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT. Unless the
Company or a Bank, as the case may be, notifies the Administrative Agent
prior to the date on which it is scheduled to make payment to the
Administrative Agent of (a) in the case of a Bank, the proceeds of a Loan
or (b) in the case of the Company, a payment of principal, interest or fees
to the Administrative Agent for the account of the Banks, that it does not
intend to make such payment, the Administrative Agent may assume that such
payment has been made. The Administrative
Page 17
Agent may, but shall not be obligated to, make the amount of such payment
available to the intended recipient in reliance upon such assumption. If
such Bank or the Company, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall,
on demand by the Administrative Agent, repay to the Administrative Agent
the amount so made available together with interest thereon in respect of
each day during the period commencing on the date such amount was so made
available by the Administrative Agent until the date the Administrative
Agent recovers such amount at a rate per annum equal to (a) in the case of
payment by a Bank, the Federal Funds Rate for such day or (b) in the case
of payment by the Company, the interest rate applicable to the relevant
Loan.
2.3.14. WITHHOLDING TAX EXEMPTION. At least five Business Days prior
to the first date on which interest or fees are payable hereunder for the
account of any Bank, each Bank that is not incorporated under the laws of
the United States of America, or a state thereof, agrees that it will
deliver to each of the Company and the Administrative Agent two duly
completed copies of United States Internal Revenue Service Form 1001 or
4224, certifying in either case that such Bank is entitled to receive
payments under this Agreement and the Notes without deduction or
withholding of any United States federal income taxes. Each Bank which so
delivers a Form 1001 or 4224 further undertakes to deliver to each of the
Company and the Administrative Agent two additional copies of such form (or
a successor form) on or before the date that such form expires (currently,
three successive calendar years for Form 1001 and one calendar year for
Form 4224) or becomes obsolete or after the occurrence of any event
requiring a change in the most recent forms so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Company or the Administrative Agent, in each case
certifying that such Bank is entitled to receive payments under this
Agreement and the Notes without deduction or withholding of any United
States federal income taxes, unless an event (including without limitation
any change in treaty, law or regulation) has occurred prior to the date on
which any such delivery would otherwise be required which renders all such
forms inapplicable or which would prevent such Bank from duly completing
and delivering any such form with respect to it and such Bank advises the
Company and the Administrative Agent that it is not capable of receiving
payments without any deduction or withholding of United States federal
income tax.
ARTICLE III
CHANGE IN CIRCUMSTANCES; INDEMNIFICATION
3.1. YIELD PROTECTION. If any law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive
(whether or not having the force of law) which becomes effective after the
date hereof, or any interpretation thereof, or compliance of any Bank with
such,
Page 18
(i) subjects any Bank or any applicable Lending Installation
to any tax, duty, charge or withholding on or from
payments due from the Company (excluding taxation of the
overall net income of any Bank or applicable Lending
Installation), or changes the basis of taxation of
payments to any Bank in respect of its Loans or other
amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Bank or any
applicable Lending Installation (other than reserves and
assessments taken into account in determining the
interest rate applicable to Eurodollar Rate Advances), or
(iii) imposes any other condition the result of which is to
increase the cost to any Bank or any applicable Lending
Installation of making, funding or maintaining loans or
reduces any amount receivable by any Bank or any
applicable Lending Installation in connection with loans,
or requires any Bank or any applicable Lending
Installation to make any payment calculated by reference
to the amount of loans held or interest received by it,
by an amount deemed material by such Bank,
then, within 15 days of demand by such Bank, the Company shall pay such
Bank that portion of such increased expense incurred or reduction in an
amount received which such Bank determines is attributable to making,
funding and maintaining its Loans and its Commitment.
3.2. CHANGES IN CAPITAL ADEQUACY REGULATIONS. If a Bank determines the
amount of capital required or expected to be maintained by such Bank, any
Lending Installation of such Bank or any corporation controlling such Bank
is increased as a result of a Change, then, within 15 days of demand by
such Bank, the Company shall pay such Bank the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Bank determines is attributable to this
Agreement, its Loans or its obligation to make Loans hereunder (after
taking into account such Bank's policies as to capital adequacy). No Bank
shall be entitled to demand payment under this Section 3.2 to the extent
that such payment relates to a period of time more than 90 days prior to
the date upon which such Bank first notified the Company of the occurrence
of the event entitling such Bank to such payment. "Change" means (i) any
change after the date of this Agreement in the Risk-Based Capital
Guidelines or (ii) any adoption of or change in any other law, governmental
or quasi-governmental rule, regulation, policy, guideline, interpretation,
or directive (whether or not having the force of law) after the date of
this Agreement which affects the amount of capital required or expected to
be maintained by any Bank or any Lending Installation or any corporation
controlling any Bank. "Risk-Based Capital Guidelines" means (i) the
risk-based capital guidelines in effect in the United States on the date of
this Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside the
United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled
Page 19
"International Convergence of Capital Measurements and Capital Standards,"
including transition rules, and any amendments to such regulations adopted
prior to the date of this Agreement.
3.3. AVAILABILITY OF INTEREST RATE. If any Bank determines that
maintenance of its Eurodollar Rate Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether
or not having the force of law, or if the Required Banks determine that (i)
deposits of a type and maturity appropriate to match fund Eurodollar Rate
Advances are not available or (ii) a Eurodollar Rate does not accurately
reflect the cost of making or maintaining a Eurodollar Rate Advance, then
the Administrative Agent shall suspend the availability of the affected
Rate Option and (subject to the next sentence) require any Eurodollar Rate
Advances outstanding under an affected Rate Option to be converted to an
unaffected Rate Option. Notwithstanding anything in the preceding sentence
to the contrary, the Company shall not be required to pay or convert any
outstanding Eurodollar Rate Loan or Eurodollar Rate Advance unless such
payment or conversion is legally required in accordance with the
circumstances causing such unavailability. Subject to the provisions of
Article II hereof, the Company may select any unaffected Rate Option to
apply to such affected Advances. If the Company fails to select a new Rate
Option, the affected Advances shall be Floating Rate Advances.
3.4. FAILURE TO PAY OR BORROW ON CERTAIN DATES. If any payment of a
Eurodollar Rate Advance occurs on a date which is not the last day of the
applicable Interest Period, whether because of acceleration, prepayment or
otherwise, or a Eurodollar Rate Advance is not made on the date specified
by the Company for any reason other than default by the Banks, the Company
will indemnify each Bank for any loss or cost incurred by it resulting
therefrom, including, without limitation, any loss or cost in liquidating
or employing deposits acquired to fund or maintain the Eurodollar Rate
Advance.
3.5. BANK CERTIFICATES; SURVIVAL OF INDEMNITY. To the extent
reasonably possible, each Bank shall designate an alternate Lending
Installation with respect to its Eurodollar Rate Loans to reduce any
liability of the Company to such Bank under Sections 3.1 and 3.2 or to
avoid the unavailability of a Rate Option under Section 3.3, so long as
such designation is not disadvantageous to such Bank as determined by such
Bank in its sole discretion. A certificate of a Bank as to the amount due,
if any, under Sections 3.1, 3.2, or 3.4 shall be final, conclusive and
binding on the Company in the absence of manifest error. Such certificate
shall set forth in reasonable detail the basis of the determination of
amounts due under such Sections. Determination of amounts payable under
such Sections in connection with a Eurodollar Rate Loan shall be calculated
as though each Bank funded its Eurodollar Rate Loan through the purchase of
a deposit of the type and maturity corresponding to the deposit used as a
reference in determining the Eurodollar Rate applicable to such Loan,
whether in fact that is the case or not. Unless otherwise provided herein,
the amount specified in the certificate shall be payable on demand after
receipt by the Company of the certificate. The obligations of the Company
under Sections 3.1, 3.2, and 3.4 shall survive payment of the Obligations
and termination of this Agreement.
Page 20
ARTICLE IV
CONDITIONS PRECEDENT
4.1. INITIAL ADVANCE. No Bank shall be required to make its initial
Revolving Loan hereunder unless the Company has furnished to the
Administrative Agent with sufficient copies for the Banks:
(a) Copies of the Articles of Incorporation of the Company,
together with all amendments, and a certificate of good
standing, both certified on or within 15 days prior to the
Effective Date by the Secretary of State of Delaware.
(b) Copies, certified on the Effective Date by the Secretary or
Assistant Secretary of the Company, of its By-Laws and of
its Board of Directors' resolutions (and resolutions of
other bodies, if any are deemed necessary by counsel for any
Bank) authorizing the execution of the Loan Documents.
(c) An incumbency certificate, certified on the Effective Date
by the Secretary or Assistant Secretary of the Company,
which shall identify by name and title and bear the
signature of the officers of the Company authorized to sign
the Loan Documents and to make borrowings hereunder, upon
which certificates the Banks shall be entitled to rely until
informed of any change in writing by the Company.
(d) A written opinion of the counsel to the Company, addressed
to the Banks, in substantially the form of Exhibit "C"
hereto.
(e) A certificate, dated the Effective Date, signed by the Chief
Financial Officer of the Company, stating that on the
Effective Date (i) no Default or Unmatured Default has
occurred and is continuing; (ii) the Company will be
utilizing the proceeds to consummate the Stock Acquisition
on the date of such Advance and (iii) no Prepayment Event
has occurred and setting forth the determination of the
Company's Funded Debt/EBITDA Ratio for the last day of the
most recently ended fiscal quarter.
(f) A Note payable to the order of each of the Banks.
(g) Payment to the Agent of all fees due and owing to the
Administrative Agent and the Banks as at the Effective Date.
Page 21
(h) Written money transfer instructions, in substantially the
form of Exhibit "D" hereto, addressed to the Administrative
Agent and signed by an Authorized Officer, together with
such other related money transfer authorizations as the
Administrative Agent may have reasonably requested.
(i) Such other documents as any Bank or its counsel may have
reasonably requested.
4.2. EACH ADVANCE. No Bank shall be required to make any Advance
unless on the applicable Borrowing Date:
(a) There exists no Default or Unmatured Default or Prepayment
Event.
(b) The representations and warranties contained in Article V,
except the representation and warranty contained in Section
5.5, are true and correct in all material respects as of
such Borrowing Date as if made on such Borrowing Date except
for changes in the Schedules hereto reflecting transactions
permitted by this Agreement.
(c) All legal matters incident to the making of such Advance
shall be satisfactory to the Banks and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute a
representation and warranty by the Company that the conditions contained in
Sections 4.2(a) and (b) have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Banks that:
5.1. CORPORATE EXISTENCE AND STANDING. Each of the Company and the
Subsidiaries is a corporation duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation and each
is duly qualified and in good standing in each jurisdiction where, because
of the nature of its activities or properties, such qualification is
required and the failure so to qualify would materially and adversely
affect its business, assets, financial condition, operations or prospects
of the Company and its Subsidiaries taken as a whole.
5.2. AUTHORIZATION AND VALIDITY. The Company has the corporate power
and authority and legal right to execute and deliver the Loan Documents and
perform its obligations thereunder.
Page 22
The execution and delivery by the Company of the Loan Documents and the
performance of its obligations thereunder have been duly authorized by
proper corporate proceedings and the Loan Documents constitute legal, valid
and binding obligations of the Company enforceable against the Company in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally.
5.3. COMPLIANCE WITH LAWS AND CONTRACTS. Neither the execution and
delivery by the Company of the Loan Documents, the consummation of the
transactions therein contemplated, nor compliance with the provisions
thereof will violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Company or any Subsidiary or the
Company's or any Subsidiary's charter, articles or certificate of
incorporation or by-laws or the provisions of any material indenture,
instrument or agreement to which the Company or any Subsidiary is a party
or is subject, or by which it, or its property, is bound, or conflict with
or constitute a default thereunder, or result in the creation or imposition
of any Lien pursuant to the terms of any such indenture, instrument or
agreement. No order, consent, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by,
any governmental or public body or authority, or any subdivision thereof,
is required to authorize, or is required as of the date hereof in
connection with the execution, delivery and performance of, or the
legality, validity, binding effect or enforceability of, any of the Loan
Documents.
5.4. FINANCIAL STATEMENTS. The June 30, 1998 audited consolidated
financial statements of the Company and its Subsidiaries heretofore
delivered to the Banks were prepared in accordance with GAAP in effect on
the date such statements were prepared and fairly present the consolidated
financial condition and operations of the Company and its Subsidiaries at
such date and the consolidated results of their operations for the period
then ended.
5.5. MATERIAL ADVERSE CHANGE. No material adverse change in the
business, condition (financial or otherwise), operations, performance, or
properties of the Company and its Subsidiaries taken as a whole has
occurred since the date of the audited financial statements referred to in
Section 5.4. The Borrower has made a full and complete assessment of the
Year 2000 Issues and has a realistic and achievable program for remediating
the Year 2000 Issues on a timely basis (the "Year 2000 Program"). Based on
such assessment and on the Year 2000 Program the Borrower does not
reasonably anticipate that Year 2000 Issues will have a Material Adverse
Effect.
5.6. TAXES. The Company and the Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to
be filed and have paid all taxes due pursuant to said returns or pursuant
to any assessment received by the Company or any Subsidiary, except such
taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided. Except as provided in Section
6.2.6(a), no material tax liens have been filed and no claims are being
asserted with respect to any such taxes. The charges, accruals and reserves
on the books of the Company and the Subsidiaries in respect of any taxes or
other governmental charges are adequate.
Page 23
5.7. LITIGATION. Except as disclosed in the Company's Form 10-K for
the year ended June 30, 1998, there is no litigation or proceeding pending
or, to the knowledge of any of their officers, threatened against the
Company or any Subsidiary which would reasonably be expected to have a
material adverse affect on the condition of the Company or the ability of
the Company to perform its obligations under the Loan Documents.
5.8. ERISA. The Unfunded Liabilities of all Plans do not in the
aggregate exceed an amount equal to 5 percent of the value (as of any date
of determination) of all Plan assets allocable to Plan benefits guaranteed
under ERISA. Each Plan complies in all material respects with all
applicable requirements of law and regulations, neither the Company nor any
of its Subsidiaries has withdrawn from any Plan or initiated steps to do
so, no steps have been taken to terminate any Plan, and no Reportable Event
has occurred with respect to any Plan, the cumulative effect of which could
have a material adverse effect on the business, operations, properties,
assets or conditions (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole.
5.9. DEFAULTS AND PREPAYMENT EVENT. No Default or Unmatured Default
has occurred and is continuing. No Prepayment Event has occurred.
5.10. ACCURACY OF INFORMATION. No information, exhibit or report
furnished by the Company or any Subsidiary in writing to the Administrative
Agent or to any Bank in connection with the negotiation of the Loan
Documents contained any material misstatement of fact or omitted to state
any fact necessary to make the statements contained therein, in light of
the circumstances under which they were made, not misleading.
5.11. REGULATION U. Neither the Company nor any Subsidiary is engaged
principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying "margin stock"
(as defined in Regulation U). No part of the proceeds of any Loan will be
used in a manner which would violate, or result in a violation of,
Regulation U. No part of the proceeds of any Loan will be used for
"purchasing" or "carrying" "margin stock" (each as defined in Regulation
U).
5.12. PARI PASSU. All the payment obligations of the Company arising
under or pursuant to the Loan Documents will at all times rank pari passu
with all other unsecured and unsubordinated payment obligations and
liabilities (including contingent obligations and liabilities) of the
Company (other than those which are mandatorily preferred by laws or
regulations of general application).
5.13. INVESTMENT COMPANY. The Company is not, and after giving effect
to any Advance will not be, an "investment company" within the meaning of
the United States Investment Company Act of 1940, as amended.
Page 24
5.14. MATERIAL LAWS. Neither the Company nor any Subsidiary has
received any notice to the effect that its operations are not in material
compliance with any of the requirements of applicable federal, state and
local environmental, health and safety statutes and regulations with
respect to, or the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a release into the
environment of, any toxic or hazardous waste or physical substance, which
non-compliance or remedial action could have a material adverse effect on
the business, operations, properties, assets or conditions (financial or
otherwise) of the Company and the Subsidiaries, taken as a whole.
5.15. MATERIAL AGREEMENTS. Neither the Company nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction materially and adversely affecting its business,
properties or assets, operations or condition (financial or otherwise).
Neither the Company nor any Subsidiary is in default in the performance,
observance of fulfillment or any of the obligations, covenants or
conditions contained in any agreement to which it is a party or any
agreement or instrument evidencing or governing Indebtedness, which default
might have a material adverse effect on the business, properties, financial
condition, or results of operations, of the Company and its Subsidiaries,
taken as a whole.
5.16. SUBSIDIARIES. Schedule "1" hereto contains an accurate list of
all of the presently existing Subsidiaries of the Company, setting forth
their respective jurisdictions of incorporation and the percentage of their
respective capital stock owned by the Company or other Subsidiaries (which
in the case of Howmet shall be calculated after taking into account the
Stock Acquisition). All of the issued and outstanding shares of capital
stock of such Subsidiaries have been duly authorized and issued and are
fully paid and non-assessable. Schedule "2" hereto accurately describes all
Indebtedness of the Subsidiaries existing on the date of this Agreement.
5.17. OWNERSHIP OF PROPERTIES. Except as permitted by Section 6.2.6.,
on the date of this Agreement, the Company and its Subsidiaries will have
good title, free of all Liens, to all of the properties and assets
reflected in the financial statements referred to in Section 5.4 as owned
by the Company and its Subsidiaries.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Banks shall
otherwise consent in writing:
6.1. AFFIRMATIVE COVENANTS.
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6.1.1. FINANCIAL REPORTING. The Company will maintain, for itself and
the Consolidated Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish to the Banks:
(a) Within 90 days after the close of each of its fiscal years,
an unqualified audit report certified by independent
certified public accountants of recognized national
standing, acceptable to the Banks, prepared in accordance
with generally accepted accounting principles on a
consolidated basis for itself and the Consolidated
Subsidiaries, including balance sheets as of the end of such
period, related profit and loss statements, a statement of
shareholders' equity, and a statement of cash flow,
accompanied by any management letter prepared by said
accountants.
(b) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and the
Consolidated Subsidiaries, consolidated unaudited balance
sheets as at the close of each such period and consolidated
profit and loss statements, a statement of shareholders'
equity, and a statement of cash flow for the period from the
beginning of such fiscal year to the end of such quarter
(subject to normal year-end audit adjustments), all
certified by its Chief Financial Officer or Treasurer.
(c) Together with the financial statements required hereunder, a
certificate signed by its Chief Financial Officer or
Treasurer (i) stating that no Default or Unmatured Default
exists, or if any Default or Unmatured Default exists,
stating the nature and status thereof, and stating the steps
the Company is taking to cure such Default or Unmatured
Default and (ii) stating that no Prepayment Event has
occurred.
(d) As soon as available, and in any event within 45 calendar
days after the end of each quarter of each fiscal year of
the Company, a schedule, certified as being accurate by the
Company's Chief Financial Officer, Treasurer or Controller,
showing, as of the end of each such quarter, the Company's
calculation, in form and detail satisfactory to the
Administrative Agent, of the calculations required to be
made to determine compliance with Section 6.2.7. The
schedule delivered within 45 calendar days after the end of
the fourth quarter of each fiscal year shall set forth a
preliminary determination subject to adjustment upon receipt
of audited annual financial statements and shall not be
deemed to constitute a misrepresentation or breach if
prepared in good faith and the audited numbers differ from
the unaudited fourth quarter results.
Page 26
(e) Promptly upon becoming available, copies of:
(i) All financial statements, reports, notices and proxy
statements sent by the Company or any Consolidated
Subsidiary to the stockholders of the Company.
(ii) All prospectuses of the Company or any Consolidated
Subsidiary filed with the Securities and Exchange
Commission or any other governmental agency succeeding
to the jurisdiction thereof.
(iii)All regular and periodic reports filed by the Company
or any Consolidated Subsidiary with any securities
exchange or with the Securities and Exchange Commission
or any other governmental agency succeeding to the
jurisdiction thereof.
(f) As soon as possible and in any event within 10 days after
receipt by the Company, a copy of (i) any notice or claim to
the effect that the Company or any Subsidiary is or may be
liable to any Person as a result of the release by the
Company, any of its Subsidiaries, or any other Person of any
toxic or hazardous waste or physical substance into the
environment, and (ii) any notice alleging any violation of
any federal, state or local environmental, health or safety
law or regulation with respect to any toxic or hazardous
waste or physical substance by the Company or any
Subsidiary, which would, in either case, have a material
adverse effect upon the operations of the Company and the
Subsidiaries, taken as a whole.
(g) As to each Plan, within 270 days after the close of each
Plan Year of such Plan, a statement of the Unfunded
Liabilities of such Plan, certified as correct by an actuary
enrolled under ERISA.
(h) As soon as possible and in any event within 10 days after
the Company knows that any Reportable Event has occurred
with respect to any Plan, a statement, signed by the chief
financial officer of the Company, describing said Reportable
Event and the action which the Company proposes to take with
respect thereto.
(i) Together with the financial statements required under
Section 6.1.1(a) hereinabove, a copy of the Company's annual
operating plan.
(j) Such other information (including non-financial information)
as the Administrative Agent or any Bank may from time to
time reasonably request.
6.1.2. USE OF PROCEEDS. The Company will, and will cause each
Subsidiary to, use the proceeds of the Advances to consummate the Stock
Acquisition and for payment of fees and expenses in connection therewith.
The Company shall use the proceeds of Advances in
Page 27
compliance with all applicable legal and regulatory requirements and any
use shall not result in a violation of any such applicable regulatory
requirements, including, without limitation, Regulation U, and the
Securities Act of 1933 and the Securities Exchange Act of 1934 and the
regulations thereunder.
6.1.3. NOTICE OF DEFAULT AND PREPAYMENT EVENT. The Company will, and
will cause each Subsidiary to, give prompt notice in writing to the Banks
of the occurrence of any Default or Unmatured Default and of any other
development related specifically to the business, properties or affairs of
the Company, financial or otherwise (including, without limitation,
developments with respect to Year 2000 Issues), which would be reasonably
likely to materially adversely affect the Company's business, properties or
affairs or the ability of the Company to repay the Obligations. The Company
will give written notice to the Banks of any Prepayment Event no later than
five Business Days following the occurrence of such Prepayment Event.
6.1.4. CONDUCT OF BUSINESS. The Company will carry on and conduct its
business in the manner of a diversified industrial company with a
commitment to the aerospace industry and will cause each Subsidiary to
conduct its business in a manner consistent with the Company's objectives
as such. The Company will, and will cause each Subsidiary to, do all things
necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation,
and maintain all requisite authority to conduct its business in each
jurisdiction where, because of the nature of its activities or properties,
such authority is required and the failure to maintain such authority would
materially and adversely affect it business, assets, financial condition,
operations or prospects.
6.1.5. PAYMENT OF TAXES. The Company will, and will cause each
Subsidiary to, pay and discharge all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits, or upon
any property belonging to it, and all lawful claims which, if unpaid, would
become a Lien, provided that neither the Company nor a Subsidiary shall be
required to pay any such tax, assessment, charge, levy or claim the payment
of which is being contested in good faith and by appropriate proceedings;
the Company will, and will cause each Subsidiary to, make monthly accruals
of all of the estimated liability of the Company and the Subsidiaries for
such taxes, assessments, charges and levies, determined in accordance with
GAAP, and establish adequate reserves determined in accordance with GAAP,
for such thereof as may be contested, and reflect such accruals and
reserves in all financial statements furnished hereunder.
6.1.6. INSURANCE. The Company will, and will cause each Subsidiary to,
maintain insurance in such amounts and covering such risks as is consistent
with sound business practice.
6.1.7. COMPLIANCE WITH LAWS. The Company will, and will cause each
Subsidiary to, comply in all material respects with all laws, rules,
regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject.
Page 28
6.1.8. MAINTENANCE OF PROPERTIES. The Company will, and will cause
each Subsidiary to, do all things necessary to maintain, preserve, protect
and keep its properties in good repair, working order and condition, and
make all necessary and proper repairs, renewals and replacements, except
for properties no longer used or useful in the respective businesses of the
Company or such Subsidiary.
6.1.9. INSPECTION. Except with respect to any information or
activities which are classified by the United States Government or
disclosure of which the Company reasonably believes would compromise
matters of national security, the Company will, and will cause each
Subsidiary to, permit the Banks, by their respective representatives and
agents and without cost to the Company, to inspect any of the properties,
corporate books and financial records of the Company and each Subsidiary,
to examine and make copies of the books of accounts and other financial
records of the Company and each Subsidiary, and to discuss the affairs,
finances and accounts of the Company and each Subsidiary with, and to be
advised as to the same by, their respective officers at such reasonable
times and intervals as the Banks may designate.
6.2. NEGATIVE COVENANTS.
6.2.1. DIVIDENDS. The Company will not, nor will it permit any
Subsidiary to, declare or pay any dividends on its capital stock or redeem,
repurchase or otherwise acquire or retire any of its capital stock at any
time outstanding, if a Default or Unmatured Default (except any Default or
Unmatured Default described in Section 7.5 hereof) or Prepayment Event
exists or would exist as a result of such declaration, payment or
redemption.
6.2.2. INDEBTEDNESS OF SUBSIDIARIES. The Company will not permit any
Subsidiary to create, incur or suffer to exist any Indebtedness, except:
(a) Indebtedness existing on the date of this Agreement and
refinancings of such Indebtedness;
(b) Indebtedness to the Company; and
(c) other Indebtedness which at any time does not exceed in the
aggregate $75,000,000.
6.2.3. MERGER. The Company will not, nor will it permit any Subsidiary
to, merge or consolidate with or into any other Person, except:
(a) any Subsidiary may merge or consolidate with or into the
Company or any Wholly-Owned Subsidiary so long as in any
merger or consolidation involving the Company, the Company
shall be the surviving or continuing corporation; and
Page 29
(b) the Company may consolidate or merge with any other
corporation if (i) the corporation which results from such
merger or consolidation (the "surviving corporation") is
organized under the laws of the United States or a
jurisdiction thereof, (ii) the due and punctual payment of
the principal of and interest on all of the Notes and the
due and punctual performance and observance of all of the
covenants in the Notes and this Agreement to be performed or
observed by the Company are expressly assumed in writing by
the surviving corporation and the surviving corporation
shall furnish to the Banks an opinion of counsel
satisfactory to the Banks to the effect that the instrument
of assumption has been duly authorized, executed and
delivered and constitutes the legal, valid and binding
contract and agreement of the surviving corporation
enforceable in accordance with its terms, except as
enforcement of such terms may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and
by general equitable principles, and (iii) at the time of
such consolidation or merger and immediately after giving
effect thereto, no Default or Unmatured Default or
Prepayment Event would exist.
6.2.4. SALE OF ASSETS. The Company will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of all, or a substantial
portion of, its property, assets or business to any other Person except for
sales of inventory in the ordinary course of business. For purposes of this
Section, "substantial portion" means assets (valued at the higher of book
or fair market value) having a value in excess of 10% of the Company's
Consolidated Total Assets.
6.2.5. SALE AND LEASEBACK. The Company will not, nor will it permit
any Subsidiary to, sell or transfer any property, the aggregate fair market
value of which at any time exceeds 10% of the Company's Consolidated Total
Assets, in order to concurrently or subsequently lease as lessee such or
similar property. The fair market value of any property sold or transferred
pursuant to this Section 6.2.5 shall be determined as of the date of such
sale or transfer.
6.2.6. LIENS. The Company will not, nor will it permit any Subsidiary
to, create, incur, or suffer to exist any Lien in, of or on the property of
the Company or any Subsidiary, except:
(a) Liens for taxes, assessments or governmental charges or
levies on its property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate
proceedings.
(b) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens, interests of bailors, bailees, consignors
and consignees, and other similar liens arising in the
ordinary course of business which secure payment of
obligations not more than 60 days past due.
Page 30
(c) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(d) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a
nature generally existing with respect to properties of a
similar character and which do not in any material way
affect the marketability of the same or interfere with the
use thereof in the business of the Company or the
Subsidiaries.
(e) Liens created in favor of the United States government or
any other Person who has purchased or contracted to purchase
goods or services from the Company or any Subsidiary with
advance or progress payments.
(f) Liens existing on the date hereof and described in Schedule
"3" hereto.
(g) Liens of or resulting from any judgment or award, the time
for the appeal or petition for rehearing of which shall not
have expired, or in respect of which the Company or a
Subsidiary shall at any time in good faith be prosecuting an
appeal or proceeding for a review and in respect of which a
stay of execution pending such appeal or proceeding for
review shall have been secured.
(h) Liens to secure statutory obligations, surety or appeal
bonds or other liens of like general nature incurred in the
ordinary course of business and not in connection with the
borrowing of money, PROVIDED, in each case, the obligation
secured is not overdue or, if overdue, is being contested in
good faith by appropriate actions or proceedings.
(i) Liens of lessors under Capitalized Leases.
(j) Liens, in addition to those described in subsections (a)
through (i) hereof, to secure Indebtedness of the Company or
any Subsidiary in an aggregate amount not to exceed at any
time 10% of the Company's Consolidated Total Assets.
6.2.7. FUNDED DEBT/EBITDA RATIO. The Company will not permit its
Funded Debt/EBITDA Ratio as at the end of any fiscal quarter to exceed 3.00
to 1.0.
6.2.8. AFFILIATES; HOWMET. The Company will not, and will not permit
any Subsidiary to, enter into any transaction (including, without
limitation, the purchase or sale of any property or service) with, or make
any payment or transfer to, any Affiliate except in the ordinary course of
business and pursuant to the reasonable requirements of the Company's or
such Subsidiary's business and upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than the Company or such
Subsidiary would obtain in a comparable arms-length transaction. The
Page 31
Company will not, and will not permit any Subsidiary to, make any advance,
distribution, or payment to or investment in Howmet or any Subsidiary of
Howmet except for purposes of acquiring equity interests in Howmet.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1. Any representation or warranty made by or on behalf of the
Company or any Subsidiary to the Banks under or in connection with any Loan
Document shall be materially false as of the date on which made.
7.2. Nonpayment of principal of the Notes when due.
7.3. Nonpayment of interest upon the Notes or of any commitment fee,
extension fee or other obligations under any of the Loan Documents within
five days after the same becomes due.
7.4. The breach by the Company of any of the terms or provisions of
Sections 6.1.3 or 6.2.
7.5. The breach by the Company (other than a breach which constitutes
a Default under Section 7.1, 7.2, 7.3 or 7.4) of any of the terms or
provisions of this Agreement which is not remedied or waived within fifteen
days after written notice from the Administrative Agent or any Bank.
7.6. Failure of the Company, any Consolidated Subsidiary or Howmet to
pay any Indebtedness in an aggregate principal amount in excess of
$10,000,000 (or the equivalent thereof in any other currency), when due, or
the default by the Company, any Consolidated Subsidiary or Howmet in the
performance of any other term, provision or condition contained in any
agreement or agreements under which Indebtedness in an aggregate principal
amount in excess of $10,000,000 (or the equivalent thereof in any other
currency) was created or is governed, the effect of which, in either case,
is to cause, or to permit the holder or holders of such Indebtedness to
cause, such Indebtedness to become due prior to its stated maturity; or
Indebtedness in an aggregate principal amount in excess of $10,000,000 (or
the equivalent thereof in any other currency) shall be declared to be due
and payable or required to be prepaid (other than by a regularly scheduled
payment), prior to the stated maturity thereof; or the Company, any
Consolidated Subsidiary or Howmet shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
Page 32
7.7. The Company or any Consolidated Subsidiary shall (a) have an
order for relief entered with respect to it under the Bankruptcy Code, (b)
make an assignment for the benefit of creditors, (c) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any substantial
part of its property, (d) institute any proceeding seeking an order for
relief under the Bankruptcy Code or seeking to adjudicate it a bankrupt or
insolvent, or seeking dissolution, winding up, liquidation, reorganization,
arrangement, adjustment or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors
or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (e) take any corporate
action to authorize or effect any of the foregoing actions set forth in
this Section 7.7 or (f) fail to contest in good faith any appointment or
proceeding described in Section 7.8.
7.8. Without the application, approval or consent of the Company or
any Consolidated Subsidiary, a receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Company or any Consolidated
Subsidiary or any substantial part of its property, or a proceeding
described in Section 7.7(d) shall be instituted against the Company or any
Consolidated Subsidiary and such appointment continues undischarged or such
proceeding continues undismissed or unstayed for a period of 60 consecutive
days.
7.9. The Company or any Consolidated Subsidiary shall fail within 30
days to pay, bond or otherwise discharge any judgment or order for the
payment of money in excess of $10,000,000, which is not stayed on appeal or
otherwise being appropriately contested in good faith.
7.10. The Unfunded Liabilities of all Plans shall exceed in the
aggregate an amount equal to 5 percent of the value (as of any date of
determination) of all Plan assets allocable to Plan benefits guaranteed
under ERISA.
7.11. An administrator, custodian or other representative, by or
pursuant to any legislative act, resolution or rule (other than the
Bankruptcy Code or any similar law, state or federal, whether now or
hereafter existing) or any order or decree of any court or any governmental
board or agency (other than any order or decree issued pursuant to the
Bankruptcy Code or any similar law, state or federal, whether now or
hereafter existing) shall take possession or control of all or such
portions of the property of any one or more of the Company and the
Consolidated Subsidiaries as would, in the sole opinion of the Required
Banks, materially interfere with the operation of the business of the
Company and the Consolidated Subsidiaries, on a consolidated basis, and
such possession or control shall continue for 30 calendar days.
7.12. The Company or any Subsidiary shall be the subject of any
proceeding or investigation pertaining to the release by the Company or any
of its Subsidiaries, or any other Person of any toxic or hazardous waste or
physical substance into the environment, or any violation of any federal,
state or local environmental, health or safety law or regulation with
respect to any toxic or hazardous waste or physical substance, which would,
in either case, have a
Page 33
material adverse effect upon the operations of the Company and the
Subsidiaries, taken as a whole.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. ACCELERATION; ALLOCATION OF PAYMENTS AFTER DEFAULT OR PREPAYMENT
EVENT. (a) If any Default described in Section 7.7 or 7.8 occurs, the
commitments of the Banks to make Advances hereunder shall automatically
terminate and the Obligations shall immediately become due and payable
without any election or action on the part of the Administrative Agent or
any Bank. If any other Default or Prepayment Event occurs, the Required
Banks may terminate the commitments of the Banks to make Advances
hereunder, or declare the Obligations to be due and payable, whereupon the
Obligations shall become immediately due and payable, or both, without
presentment, demand, protest or notice of any kind, all of which the
Company hereby expressly waives.
If, within 14 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Banks to make Loans
hereunder as a result of any Default (other than any Default as described
in Section 7.7 or 7.8 with respect to the Company) and before any judgment
or decree for the payment of the Obligations due shall have been obtained
or entered, the Required Banks (in their sole discretion) shall so direct,
the Administrative Agent shall, by notice to the Company, rescind and annul
such acceleration and/or termination.
(b) Upon the occurrence of (i) any Unmatured Default as to which the
Required Banks shall have notified the Administrative Agent that the
provisions of this Section 8.1(b) shall apply, (ii) any Default or (iii)
any Prepayment Event, the Banks shall share all collections and recoveries
of the Obligations on a pro rata basis, based on the respective amounts of
Obligations (whether or not mature and currently payable) owing to each
Bank in respect of principal and unpaid accrued interest, fees and
indemnities hereunder as of the date of occurrence of such Default,
Unmatured Default or Prepayment Event, as the case may be.
8.2. AMENDMENTS. Subject to the provisions of this Section, the
Required Banks (or the Administrative Agent with the consent in writing of
the Required Banks) and the Company may enter into agreements supplemental
hereto for the purpose of adding any provisions to the Loan Documents or
changing in any manner the rights of the Banks or the Company hereunder or
waiving any Default hereunder; PROVIDED, HOWEVER, that no such supplemental
agreement shall, without the consent of all of the Banks:
Page 34
(a) Modify any of the provisions of this Agreement with respect to
the amount of or the time for the payment of the principal of or
any interest on any of the Obligations or any of the fees due
hereunder,
(b) Reduce the percentage specified in the definition of Required
Banks.
(c) Change the amount of the Commitment of any Bank hereunder or the
Revolving Credit Termination Date or Termination Date.
(d) Amend this Section 8.2.
No amendment of any provision of this Agreement relating to the
Administrative Agent shall be effective without the written consent of the
Administrative Agent.
8.3. PRESERVATION OF RIGHTS. No delay or omission of the Banks or the
Administrative Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid
unless in writing signed by the Banks required pursuant to Section 8.2, and
then only to the extent in such writing specifically set forth. All
remedies contained in the Loan Documents or by law afforded shall be
cumulative and all shall be available to the Administrative Agent and the
Banks until the Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1. SURVIVAL OF REPRESENTATIONS. All representations and warranties
of the Company contained in this Agreement shall survive delivery of the
Notes and the making of the Loans herein contemplated.
9.2. GOVERNMENTAL REGULATION. Anything contained in this Agreement to
the contrary notwithstanding, no Bank shall be obligated to extend credit
to the Company in violation of any limitation or prohibition provided by
any applicable statute or regulation.
9.3. TAXES. Any taxes (excluding income taxes whether or not such
taxes are actually called "income taxes") payable or ruled payable by
Federal or State authority in respect of the Loan Documents shall be paid
by the Company, together with interest and penalties, if any.
Page 35
9.4. CHOICE OF LAW. THE LOAN DOCUMENTS SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT
OTHERWISE WITHOUT REGARD TO THE CONFLICTS OF LAWS PROVISIONS) OF THE STATE
OF ILLINOIS, BUT GIVING EFFECT TO APPLICABLE FEDERAL LAWS.
9.5. CONSENT TO JURISDICTION. THE COMPANY HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS
STATE COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENTS AND THE COMPANY HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY
NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT
FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR
ANY BANK TO BRING PROCEEDINGS AGAINST THE COMPANY IN THE COURTS OF ANY
OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE COMPANY AGAINST THE
ADMINISTRATIVE AGENT OR ANY BANK OR ANY AFFILIATE OF THE ADMINISTRATIVE
AGENT OR ANY BANK INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY
ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.
9.6. WAIVER OF JURY TRIAL. THE COMPANY, THE ADMINISTRATIVE AGENT AND
EACH BANK HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY
LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
9.7. HEADINGS. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of
any of the provisions of the Loan Documents.
9.8. ENTIRE AGREEMENT. The Loan Documents embody the entire agreement
and understanding among the Company, the Administrative Agent and the Banks
and supersede all prior agreements and understandings among the Company,
the Administrative Agent and the Banks relating to the subject matter
thereof.
9.9. SEVERAL OBLIGATIONS. The respective obligations of the Banks
hereunder are several and not joint and no Bank shall be the partner or
agent of any other (except to the extent to which the Administrative Agent
is authorized to act as such). The failure of any Bank to perform any of
its obligations hereunder shall not relieve any other Bank from any of its
obligations hereunder.
Page 36
9.10. EXPENSES. The Company shall reimburse the Administrative Agent
for any and all costs and out-of-pocket expenses (including attorneys' fees
and time charges of attorneys for the Administrative Agent, which attorneys
may be employees of the Administrative Agent,) paid or incurred by the
Administrative Agent and the Arranger in connection with the preparation,
review, execution, delivery, amendment and modification of the Loan
Documents. The Company shall reimburse the Administrative Agent and the
Banks for any and all costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the
Administrative Agent and the Banks, which attorneys may be employees of the
Administrative Agent or the Banks) paid or incurred by the Administrative
Agent or any Bank in connection with the collection and enforcement of the
Loan Documents. The Company further agrees to indemnify the Administrative
Agent, the Arranger and each Bank, its directors, officers and employees
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (including, without limitation, all expenses of litigation or
preparation therefor whether or not the Administrative Agent, the Arranger,
or any Bank is a party thereto) which any of them may pay or incur in
connection with or arising out of or relating to this Agreement, the other
Loan Documents, the transactions contemplated hereby or the direct or
indirect application or proposed application of the proceeds of any Loan
hereunder; PROVIDED, HOWEVER, that the Company shall not be liable for any
of the foregoing to the extent that they arise from a violation of law by,
or the gross negligence or willful misconduct of, the Administrative Agent,
the Arranger or such Bank, as the case may be. The obligations of the
Company under this Section shall survive the termination of this Agreement.
9.12. NUMBERS OF DOCUMENTS. All closing documents, notices and
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to
each of the Banks.
9.13. CONFIDENTIALITY. Each Bank agrees to hold any confidential
information which it may receive from the Company pursuant to this
Agreement in confidence, except for disclosure (i) to its Affiliates and to
other Banks and their respective Affiliates, (ii) to legal counsel,
accountants, and other professional advisors to that Bank or to a
Transferee, (iii) to regulatory officials, (iv) to any Person as required
by law, regulation, or legal process, (v) to any Person in connection with
any legal proceeding to which that Bank is a party, and (vi) permitted by
Section 12.4. Each Bank will notify the Company of any disclosure under
clauses (iii) (other than disclosure pursuant to a request arising in the
course of a bank audit, notice of which such Bank shall deliver to the
Company as soon as is practicable), (iv), and (v) hereinabove before
divulging such information unless such disclosure is legally prohibited by
the terms of the request or demand for such information.
Page 37
ARTICLE X
THE ADMINISTRATIVE AGENT
10.1. APPOINTMENT. The First National Bank of Chicago is hereby
appointed Administrative Agent hereunder, and each of the Banks irrevocably
authorizes the Administrative Agent to act as the agent of such Bank. The
Administrative Agent agrees to act as such upon the express conditions
contained in this Article X. The duties of the Administrative Agent shall
be administrative in nature and the Administrative Agent shall not have a
fiduciary relationship in respect of any Bank by reason of this Agreement.
10.2. POWERS. The Administrative Agent shall have and may exercise
such powers hereunder as are specifically delegated to the Administrative
Agent by the terms hereof, together with such powers as are reasonably
incidental thereto. The Administrative Agent shall have no implied duties
to the Banks, or any obligation to the Banks to take any action hereunder
except any action specifically provided by this Agreement to be taken by
the Administrative Agent.
10.3. GENERAL IMMUNITY. Neither the Administrative Agent nor any of
its directors, officers, agents or employees shall be liable to the Banks
or any Bank for any action taken or omitted to be taken by it or them
hereunder or in connection herewith except for its or their own gross
negligence or wilful misconduct.
10.4. NO RESPONSIBILITY FOR LOANS, RECITALS, ETC. The Administrative
Agent shall not be responsible to the Banks for any recitals, reports,
statements, warranties or representations herein or any Loans hereunder or
be bound to ascertain or inquire as to the performance or observance of any
of the terms of this Agreement.
10.5. RIGHT TO INDEMNITY. The Administrative Agent shall be fully
justified in failing or refusing to take any action hereunder unless it
shall first be indemnified to its satisfaction by the Banks pro rata
against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action.
10.6. ACTION ON INSTRUCTIONS OF BANKS. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with written instructions signed by the Required
Banks, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Banks and on all holders of
Notes.
10.7. EMPLOYMENT OF AGENTS AND COUNSEL. The Administrative Agent may
execute any of its duties as Administrative Agent hereunder by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Banks, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Administrative
Agent
Page 38
shall be entitled to advice of counsel concerning all matters pertaining to
the agency hereby created and its duties hereunder.
10.8. RELIANCE ON DOCUMENTS; COUNSEL. The Administrative Agent shall
be entitled to rely upon any Note, notice, consent, certificate, affidavit,
letter, telegram, statement, paper or document believed by it to be genuine
and correct and to have been signed or sent by the proper person or
persons, and, in respect to legal matters, upon the opinion of counsel
selected by the Administrative Agent.
10.9. ADMINISTRATIVE AGENT'S REIMBURSEMENT. Each Bank agrees to
reimburse the Administrative Agent in the amount of such Bank's ratable
share of the Commitments for any expenses not reimbursed by the Company (i)
for which the Administrative Agent is entitled to reimbursement by the
Company under the Loan Documents and (ii) for any other expenses,
liabilities, obligations, losses, damages, penalties, costs, or
disbursements of any kind incurred by the Administrative Agent on behalf of
the Banks, in connection with the preparation, execution, delivery,
administration and enforcement of the Loan Documents; PROVIDED, HOWEVER,
that no Bank shall be required to reimburse the Administrative Agent for
any such expenses to the extent that they arise from a violation of law by,
or the gross negligence or willful misconduct of, the Administrative Agent.
The obligations of the Banks under this Section 10.9 shall survive payment
of the Obligations and termination of this Agreement.
10.10. RIGHTS AS A BANK. With respect to its Commitment, Loans made by
it and the Note issued to it, the Administrative Agent shall have the same
rights and powers hereunder as any Bank and may exercise the same as though
it were not the Administrative Agent, and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include the Administrative Agent in
its individual capacity. The Administrative Agent may accept deposits from,
lend money to, and generally engage in any kind of banking or trust
business with the Company as if it were not the Administrative Agent.
10.11. BANK CREDIT DECISION. Each Bank acknowledges that it has,
independently and without reliance upon the Administrative Agent or any
other Bank and based on the financial statements referred to in Section 5.4
and such other documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each
Bank also acknowledges that it will, independently and without reliance
upon the Administrative Agent or any other Bank and based on such documents
and information as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action under this
Agreement.
10.12. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign at any time by giving thirty days' written notice thereof to the
Banks and the Company and may be removed at any time with or without cause
by the Required Banks. Upon any such resignation or removal, the Required
Banks shall have the right to appoint, on behalf of the Banks but with the
consent of the Company (which consent shall not be unreasonably withheld),
a successor
Page 39
Administrative Agent. If no successor Administrative Agent shall have been
so appointed by the Required Banks and shall have accepted such appointment
within thirty days after the retiring Administrative Agent's giving notice
of resignation, then the retiring Administrative Agent may appoint, on
behalf of the Banks but with the consent of the Company (which consent
shall not be unreasonably withheld), a successor Administrative Agent. Such
successor Administrative Agent shall be a commercial bank having capital
and retained earnings of at least $500,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations hereunder. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article X shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was
acting as the Administrative Agent hereunder.
10.13. DISTRIBUTION OF INFORMATION. The Company authorizes the
Administrative Agent, as the Administrative Agent may elect in its sole
discretion, to discuss with and furnish to the Banks or to any other Person
having an interest in the Obligations (whether as a guarantor, pledgor of
collateral, participant, purchaser or otherwise) all financial statements,
audit reports and other information pertaining to the Company and its
Subsidiaries whether such information was provided by the Company or
prepared or obtained by the Administrative Agent; PROVIDED, HOWEVER, that
if such information is non-public and confidential, the Administrative
Agent shall obtain the consent of the Company (which shall not be
unreasonably withheld) prior to delivering such information to any such
Person and such Person shall have agreed to be bound by Section 9.13 of
this Agreement.. Neither the Administrative Agent nor any of its employees,
officers, directors or agents makes any representation or warranty
regarding any audit reports or other analyses of the Company's and its
Subsidiaries condition which the Administrative Agent may elect to
distribute, whether such information was provided by the Company or
prepared or obtained by the Administrative Agent, nor shall the
Administrative Agent or any of its employees, officers, directors or agents
be liable to any person or entity receiving a copy of such reports or
analyses for any inaccuracy or omission contained in or relating thereto.
10.14. DISCLOSURE. The Borrower and each Bank hereby (i) acknowledge
and agree that (a) one or more Affiliates of First Chicago are or may
become direct or indirect equity investors in the Company or its
Affiliates, (b) First Chicago is or may become a lender to, and agent bank
for, the Company and/or its Affiliates, including, without limitation,
pursuant to (i) the syndicated credit arrangements of Howmet in which First
Chicago presently acts as administrative agent and a lender, (ii) the
syndicated credit arrangements of the Company in which First Chicago
presently acts as administrative agent and as a lender, and (iii) the
short-term credit arrangements of the Company in which First Chicago
presently acts as the administrative agent and as a lender and (c) First
Chicago and/or its Affiliates from time to time may hold other investments
in, make other loans to or have other relationships with the Company and
its Affiliates, and (ii) waive any liability of First Chicago or such
Affiliate to the Borrower or any Bank, respectively, arising out of or
Page 40
resulting from such investments, loans or relationships other than
liabilities arising out of the gross negligence or willful misconduct of
First Chicago or its Affiliates.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. SETOFF. In addition to, and without limitation of, any rights of
the Banks under applicable law, if the Company becomes insolvent, however
evidenced, or any Default or Prepayment Event occurs, any indebtedness from
any Bank to the Company may be offset and applied toward the payment of the
Obligations owing to such Bank, whether or not the Obligations, or any part
thereof, shall then be due.
11.2. RATABLE PAYMENTS. In case at any time any Bank, whether by
setoff or otherwise, has payment made to it upon its Loans in a greater
proportion than received by any other Bank, such Bank so receiving such
greater proportionate payment agrees to purchase a portion of the Loans
held by the other Banks so that after such purchase each Bank will hold its
ratable proportion of Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made. The
Company agrees that any Bank purchasing a participation hereunder may, to
the fullest extent permitted by law, exercise all its rights of payment
with respect to such participation as if such Bank were the direct creditor
of the Company in the amount of the participation.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. SUCCESSORS AND ASSIGNS. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Company and
the Banks and their respective successors and assigns, except that (i) the
Company shall not have the right to assign its rights or obligations under
the Loan Documents and (ii) any assignment by any Bank must be made in
compliance with Section 12.3. Notwithstanding clause (ii) of this Section,
any Bank may at any time, without the consent of the Company or the
Administrative Agent, assign all or any portion of its rights under this
Agreement and its Notes to a Federal Reserve Bank; PROVIDED, HOWEVER, that
no such assignment to a Federal Reserve Bank shall release the transferor
Bank from its obligations hereunder. The Administrative Agent may treat the
payee of any Note as the owner thereof for all purposes hereof unless and
until such payee complies with Section 12.3 in the case
Page 41
of an assignment thereof or, in the case of any other transfer, a written
notice of the transfer is filed with the Administrative Agent. Any assignee
or transferee of a Note agrees by acceptance thereof to be bound by all the
terms and provisions of the Loan Documents. Any request, authority or
consent of any Person, who at the time of making such request or giving
such authority or consent is the holder of any Note, shall be conclusive
and binding on any subsequent holder, transferee or assignee of such Note
or of any Note or Notes issued in exchange therefor.
12.2. PARTICIPATIONS.
12.2.1. PERMITTED PARTICIPANTS; EFFECT. Any Bank may, in the
ordinary course of its business and in accordance with applicable law,
at any time sell to one or more banks or other entities
("Participants") participating interests in any Loan owing to such
Bank, any Note held by such Bank, any Commitment of such Bank or any
other interest of such Bank under the Loan Documents. In the event of
any such sale by a Bank of participating interests to a Participant,
such Bank's obligations under the Loan Documents shall remain
unchanged, such Bank shall remain solely responsible to the other
parties hereto for the performance of such obligations, such Bank
shall remain the holder of any each of its Notes for all purposes
under the Loan Documents, all amounts payable by the Company under
this Agreement shall be determined as if such Bank had not sold such
participating interests, and the Company and the Administrative Agent
shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under the Loan
Documents.
12.2.2. VOTING RIGHTS. Each agreement pursuant to which any Bank
may sell such a participation shall provide that such Bank shall
retain the sole right to approve, without the consent of any
Participant, any amendment, modification or waiver of any provision of
the Loan Documents other than any amendment, modification or waiver
with respect to any Loan or Commitment in which such Participant has
an interest which forgives principal, interest or fees or reduces the
interest rate or fees payable with respect to any such Loan or
Commitment, postpones any date fixed for any regularly-scheduled
payment of principal of, or interest or fees on, any such Loan or
Commitment, releases any guarantor of any such Loan or releases any
substantial portion of collateral, if any, securing any such Loan;
provided that such participation agreement may provide that such Bank
will not agree to any modification, amendment or waiver of this
Agreement described in Sections 8.2 (a), (c) and (d) without the
consent of the Participant.
12.3. ASSIGNMENTS.
12.3.1. PERMITTED ASSIGNMENTS. Any Bank may, in the ordinary
course of its business and in accordance with applicable law, at any
time assign to one or more banks or other entities ("Purchasers") all
or any part of its rights and obligations under the Loan Documents.
Such assignment shall be substantially in the form of Exhibit "E"
hereto or in such other form as may be agreed to by the parties
thereto. The consent of the
Page 42
Company and the Administrative Agent shall be required prior to an
assignment becoming effective; PROVIDED, HOWEVER, that if a Default
has occurred and is continuing, the consent of the Company shall not
be required. Such consent shall not be unreasonably withheld or
delayed. Each such assignment with respect to a Purchaser which is not
a Bank or an Affiliate thereof shall (unless each of the Borrower and
the Agent otherwise consents, such consent of the Borrower not being
required if a Default has occurred and is continuing) be in an amount
not less than the lesser of (i) $10,000,000 or (ii) the remaining
amount of the assigning Bank's Commitment (calculated as at the date
of such assignment) or outstanding Loans (if the applicable Commitment
has been terminated).
12.3.2. SUBSTITUTION OF BANK. The Company may, at its sole
expense and effort, require any Bank to transfer and assign, without
recourse (in accordance with this Section 12.3) all (but not less than
all) of its interests, rights and obligations under this Agreement to
an assignee which shall assume such assigned obligations (which
assignee may be another Bank, if a Bank accepts such assignment);
PROVIDED, that (i) such assignment shall not conflict with any law,
rule or regulation or order of any court or other governmental
authority, (ii) the Company shall have received a written consent of
the Agent in the case of an entity that is not a Bank, which consent
shall not be unreasonably withheld, (iii) the Company or such assignee
shall have paid to the assigning Bank in immediately available funds
the principal of and interest accrued to the date of such payment on
the Loans made by it hereunder and all other amounts owed to it
hereunder and the fee payable to the Agent pursuant to Section 12.3.3
and (iv) nothing in the foregoing is intended or shall be construed as
obligating the Administrative Agent or any Bank to locate such an
assignee.
12.3.3. EFFECT; EFFECTIVE DATE. Upon (i) delivery to the
Administrative Agent of a notice of assignment, substantially in the
form attached as Exhibit "I" to Exhibit "E" hereto (a "Notice of
Assignment"), together with any consents required by Section 12.3.1 or
12.3.2, and (ii) payment of a $3,500 fee to the Administrative Agent
for processing such assignment, such assignment shall become effective
on the effective date specified in such Notice of Assignment. The
Notice of Assignment shall contain a representation by the Purchaser
to the effect that none of the consideration used to make the purchase
of the Commitment and Loans under the applicable assignment agreement
are "plan assets" as defined under ERISA and that the rights and
interests of the Purchaser in and under the Loan Documents will not be
"plan assets" under ERISA. On and after the effective date of such
assignment, such Purchaser shall for all purposes be a Bank party to
this Agreement and any other Loan Document executed by the Banks and
shall have all the rights and obligations of a Bank under the Loan
Documents, to the same extent as if it were an original party hereto,
and no further consent or action by the Company, the Banks or the
Administrative Agent shall be required to release the transferor Bank
with respect to the percentage of the Aggregate Commitment and Loans
assigned to such Purchaser. Upon the consummation of any assignment to
a Purchaser pursuant to this Section 12.3.3, the transferor Bank, the
Administrative Agent and the
Page 43
Company shall make appropriate arrangements so that replacement
Notes are issued to such transferor Bank and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in
each case in principal amounts reflecting their respective
Commitments, as adjusted pursuant to such assignment.
12.4. DISSEMINATION OF INFORMATION. The Company authorizes each Bank
to disclose to any Participant or Purchaser or any other Person acquiring
an interest in the Loan Documents by operation of law (each a "Transferee")
and any prospective Transferee any and all information in such Bank's
possession concerning the creditworthiness of the Company and its
Subsidiaries; PROVIDED, HOWEVER, that if such information is non-public and
confidential, such Bank shall obtain the consent of the Company (which
shall not be unreasonably withheld) prior to delivering such information to
such Person and such Person agrees to be bound by Section 9.13 of this
Agreement. No Bank may disclose confidential information regarding the
Company and its Subsidiaries to prospective Transferees without the consent
of the Company.
12.5. TAX TREATMENT. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the
transferor Bank shall cause such Transferee, concurrently with the
effectiveness of such transfer, to comply with the provisions of Section
2.3.14.
ARTICLE XIII
NOTICES
13.1. GIVING NOTICE. Any notice required or permitted to be given
under this Agreement may be given by (a) actual delivery to the Company,
the Administrative Agent or the Banks at the addresses indicated below
their signatures to this Agreement, or (b) United States mail, postage
prepaid, or telecopy or telefacsimile addressed to the Company, the Banks
or the Administrative Agent at the addresses indicated below their
signatures to this Agreement. Each such notice shall be effective (a) if
given by mail, 72 hours after such notice is deposited in the mails with
first class postage prepaid, addressed as aforesaid, and (b) if given by
any other means, when delivered at the address specified in accordance with
this Article XIII.
13.2. CHANGE OF ADDRESS. The Company and the Banks may each change the
address for service of notice upon it by a notice in writing to the other
parties hereto.
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ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all
of which taken together shall constitute one agreement, and any of the
parties hereto may execute this Agreement by signing any such counterpart.
This Agreement shall be effective when it has been executed by the Company,
the Administrative Agent and the Banks and each party has notified the
Administrative Agent by telecopy or telefacsimile or by telephone,
confirmed in writing, that it has taken such action.
Page 45
IN WITNESS WHEREOF, the Company, the Banks and the Administrative
Agent have executed this Agreement as of the date first above written.
CORDANT TECHNOLOGIES INC.
By:_______________________________
Xxxxxxx X. Xxxxxx
Executive Vice President and Chief
Financial Officer
ALL NOTICES: Cordant Technologies Inc.
00 X. Xxxxx Xxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxx, XX 00000
Attn: Treasury Department
Telephone: 000-000-0000
Telecopy: 000-000-0000
Page 46
COMMITMENTS
$400,000,000 THE FIRST NATIONAL BANK OF CHICAGO,
INDIVIDUALLY AND AS ADMINISTRATIVE AGENT
By:___________________________________________
Xxxxxxx Xxxxxxx
Vice President
ALL NOTICES AND CREDIT MATTERS: The First National Bank of Chicago
Mail Suite IL1-0374
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Transportation Division,
Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
ALL BORROWING NOTICES: The First National Bank of Chicago
Mail Suite IL1-0634
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
WIRE TRANSFER PAYMENT INSTRUCTIONS:
The First National Bank of Chicago
Ref: Cordant Technologies Inc.
ABA #: 071 0000 13
Credit LS2OSD Money Transfer Inc.
Account Number 4811-5286-0000
AGGREGATE COMMITMENT
$400,000,000
Page 47
EXHIBIT "A"
EXTENSION REQUEST
__________, 1999
To: The First National Bank of Chicago, as agent (the
"Administrative Agent")
From: Cordant Technologies Inc.
Re: Credit Agreement (the "Agreement") dated as of February
5, 1999 among Cordant Technologies Inc., the Banks
listed on the signature pages thereof and the
Administrative Agent
We hereby give notice pursuant to Section 2.2.2 of the Agreement
that we request conversion of the Revolving Credit Termination Balance on
the Revolving Credit Termination Date to Term Loans. The Company hereby
represents and warrants that as of the date hereof and as of the Revolving
Credit Termination Date, all conditions precedent to the conversion of the
Revolving Loans to Term Loans under Section 2.2.3 have been satisfied and
(i) no Default or Unmatured Default has occurred and is continuing under
the Agreement other than [______________________]; and (ii) no Prepayment
Event has occurred.
Terms used herein have the meanings assigned to them in the
Agreement.
CORDANT TECHNOLOGIES INC.
By:________________________________
Title:______________________________
Page 48
EXHIBIT "B"
FORM OF
PROMISSORY NOTE
$400,000,000 February 5, 1999
CORDANT TECHNOLOGIES INC., a Delaware corporation (the "Company"),
promises to pay to the order of (the "Bank") the lesser of the principal
sum of Four Hundred Million and No/100 Dollars or the aggregate unpaid
principal amount of all Loans made by the Bank to the Company pursuant to
Section 2.1 of the Credit Agreement ("Agreement") hereinafter referred to
or converted pursuant to Section 2.2 of the Agreement, whichever is less,
in immediately available funds at the main office of The First National
Bank of Chicago in Chicago, Illinois, as Administrative Agent, together
with interest on the unpaid principal amount hereof at the rates and on the
dates set forth in the Agreement. The Company shall pay the principal of
and accrued and unpaid interest on the Loans in full on the Termination
Date.
The Bank shall, and is hereby authorized to, record on the schedule
attached hereto, or otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.
This Promissory Note is one of the Notes issued pursuant to, and is
entitled to the benefits of, the Credit Agreement dated as of February 5,
1999, among the Company, The First National Bank of Chicago, individually
and as Administrative Agent, and the banks named therein, to which
Agreement, as it may be amended from time to time, reference is hereby made
for a statement of the terms and conditions under which this Promissory
Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
CORDANT TECHNOLOGIES INC.
By:__________________________________
Xxxxxxx X. Xxxxxx
Executive Vice President and
Chief Financial Officer
Page 49
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
SYNDICATED LOANS PROMISSORY NOTE
OF CORDANT TECHNOLOGIES INC.
DATED FEBRUARY 5, 1999
PRINCIPAL MATURITY PRINCIPAL
AMOUNT OF OF INTEREST AMOUNT UNPAID
DATE LOAN PERIOD PAID BALANCE
Page 50
EXHIBIT "C"
OPINION OF COUNSEL
February 5, 1999
The Administrative Agent and the Banks who are parties to the Credit
Agreement described below.
Ladies and Gentlemen:
This is in regard to the Credit Agreement dated as of February 5, 1999
among Cordant Technologies Inc. (the "Company"), the Banks named therein
and The First National Bank of Chicago, as Administrative Agent (the
"Credit Agreement"). Unless the context otherwise requires, all terms used
in this opinion which are specifically defined in the Credit Agreement
shall have the meanings given such terms in the Credit Agreement.
I am the Vice President and General Counsel of the Company and have acted
as such in connection with the Credit Agreement. In so acting, I have
examined originals (or copies thereof certified to my satisfaction) of such
corporate and other documents of the Company (including certificates of
officers of the Company on which I have relied) and such statutes and
regulations as I have deemed relevant and necessary in order to give the
following opinion; the certificate of incorporation and by-laws of the
Company and its Subsidiaries as set forth on Schedule 1 of the Credit
Agreement; the corporate proceedings and other actions taken by the Company
and its Subsidiaries as set forth on Schedule 1 of the Credit Agreement to
qualify, and maintain its good standing, in the jurisdiction of its
incorporation and in those jurisdictions in which the Company and its
Subsidiaries are qualified as foreign corporations; and the corporate
proceedings of the Company taken to authorize the execution, delivery and
performance of the Credit Agreement and the Notes and the borrowings under
the Credit Agreement.
Based upon the foregoing, it is my opinion that:
1. The Company is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware. The
Company has all corporate power required to carry on its ordinary
course of business.
2. The Company has no other subsidiaries except as set forth on
Schedule 1 of the Credit Agreement. Each domestic subsidiary set
forth on Schedule 1 of the Credit Agreement is a corporation duly
incorporated, validly existing and in good standing under the
laws of the State of Incorporation set forth on Schedule 1.
Page 51
3. The Company and its Subsidiaries are each duly qualified as a
foreign corporation in good standing to do business in all
jurisdictions where the failure to so qualify would have a
material adverse effect on the business of the Company and the
subsidiaries taken as a whole. The Company and its operating
subsidiaries are duly qualified as a foreign corporation in good
standing in the States listed on Schedule 1A.
4. The execution and delivery of the Credit Agreement and the Notes
by the Company, the borrowings by the Company under the Credit
Agreement and the performance by the Company of its obligations
under the Credit Agreement and the Notes have been duly
authorized by all necessary corporate action and proceedings on
the part of the Company and do not at this time:
(a) require any consent of the Company's shareholders;
(b) contravene, or constitute a default under, any provision
of any law or regulation applicable to the Company or of
the certificate of incorporation or by-laws of the
Company or of any material contract, agreement, judgment,
order, decree, adjudication or other instrument binding
upon the Company, or by which the Company or its property
may be bound or affected, or result in the creation of
any Lien on any property now owned by the Company or any
Subsidiaries pursuant to the provisions of any agreement,
indenture or other instrument binding upon it.
5. The Credit Agreement and the Notes have been duly executed and
delivered by the Company and constitute the legal, valid and
binding obligations of the Company enforceable in accordance with
their terms, except as such enforceability may be limited by
bankruptcy or similar laws and by laws and judicial decisions
relating generally to the enforcement of creditors' rights and
subject also to the availability of equitable remedies and to
general principles of equity.
6. Except as otherwise set forth in the Company's Form 10-K as of
June 30, 1998, a copy of which has been previously delivered to
you, there is as of the date hereof no action, suit, proceeding
or investigation of which I am aware pending or threatened
against or affecting the Company or any subsidiary before any
court, regulatory commission, arbitration tribunal, governmental
department, administrative agency or instrumentality which, would
be reasonably expected to have a material adverse effect on the
business, condition (financial or otherwise) or operations of the
Company and its Subsidiaries as a whole.
7. Neither the Company nor its Subsidiaries is in default or
violation in any respect which would have a material adverse
effect on the business or condition (financial or otherwise) of
the Company and its Subsidiaries as a whole with respect to any
law, rule, regulation, order, writ, judgment, injunction, decree,
adjudication, determination or award presently in effect and
applicable to it.
Page 52
8. No approval, authorization, consent adjudication or order of any
governmental authority, which has been obtained by the Company,
is required to be obtained by the Company as of the date hereof
in connection with the execution and delivery of the Credit
Agreement, the Notes, the borrowings under the Credit Agreement
or in connection with the performance by the Company of its
obligations under the Credit Agreement and the Notes.
9. The Company is not engaged principally or as one of its important
activities in the business of extending credit for the purpose of
purchasing or carrying any "margin stock" (as such term is
defined in Regulation U of the Board of Governors of the Federal
Reserve System).
10. The Company is not an "investment company," within the meaning of
the Investment Company Act of 1940, as currently in effect.
Very truly yours,
Xxx Xxxxx
Page 53
EXHIBIT "D"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To The First National Bank of Chicago, as Administrative Agent (the
"Administrative Agent") under the Credit Agreement Described
Below.
Re: Credit Agreement, dated as of February 5, 1999 (as the same may
be amended or modified, the "Credit Agreement"), among Cordant
Technologies Inc. (the "Company"), the Administrative Agent, and
the Banks NAMED THEREIN
Terms used herein and not otherwise defined shall have the meanings
assigned thereto in the Credit Agreement.
The Administrative Agent is specifically authorized and directed to
act upon the following standing money transfer instructions with respect to
the proceeds of Advances or other extensions of credit from time to time
until receipt by the Administrative Agent of a specific written revocation
of such instructions by the Company, PROVIDED, HOWEVER, that the
Administrative Agent may otherwise transfer funds as hereafter directed in
writing by the Company in accordance with Section 13.1 of the Credit
Agreement or based on any telephonic notice made in accordance with Section
2.3.10 of the Credit Agreement.
Facility Identification Number(s) _________________________________________
Customer/Account Name ____________________________________________________
Transfer Funds To ________________________________________________________
-----------------------------------------------------------------
------------------------------------------------------------------
For Account No. _________________________________________________________
Reference/Attention To __________________________________________________
Authorized Officer (Customer Representative) Date _________________
-------------------------------------- ----------------------
(Please Print) Signature
Bank Officer Name Date __________________________
------------------------------------- ---------------------------------
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
Page 54
EXHIBIT "E"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
__________ (the "Assignor") and _______________________ ( the "Assignee")
is dated as of _______, 19__. The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit
Agreement (which, as it may be amended, modified, renewed or extended from
time to time is herein called the "Credit Agreement") described in Item 1
of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used herein
and not otherwise defined herein shall have the meanings attributed to them
in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, , an interest in and to the Assignor's rights and obligations
under the Credit Agreement and the other Loan Documents, such that after
giving effect to such assignment the Assignee shall have purchased pursuant
to this Assignment Agreement the percentage interest specified in Item 3 of
Schedule 1 of all outstanding rights and obligations under the Credit
Agreement and the other Loan Documents relating to the facilities listed in
Item 3 of Schedule 1 and the other Loan Documents. The aggregate Commitment
(or Loans, if the applicable Commitment has been terminated) purchased by
the Assignee hereunder is set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement
(the "Effective Date") shall be the later of the date specified in Item 5
of Schedule 1 or two Business Days (or such shorter period agreed to by the
Agent) after a Notice of Assignment substantially in the form of Exhibit
"I" attached hereto has been delivered to the Agent. Such Notice of
Assignment must include any consents required to be delivered to the Agent
by Section 12.3.1 or 12.3.2 of the Credit Agreement. In no event will the
Effective Date occur if the payments required to be made by the Assignee to
the Assignor on the Effective Date under Sections 4 and 5 hereof are not
made on the proposed Effective Date. The Assignor will notify the Assignee
of the proposed Effective Date no later than the Business Day prior to the
proposed Effective Date. As of the Effective Date, (i) the Assignee shall
have the rights and obligations of a Bank under the Loan Documents with
respect to the rights and obligations assigned to the Assignee hereunder
and (ii) the Assignor shall relinquish its rights and be released from its
corresponding obligations under the Loan Documents with respect to the
rights and obligations assigned to the Assignee hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal,
interest and fees with respect to the interest assigned hereby. The
Assignee shall advance funds directly to the Agent with respect to
Page 55
all Loans and reimbursement payments made on or after the Effective Date
with respect to the interest assigned hereby. [In consideration for the
sale and assignment of Loans hereunder, (i) the Assignee shall pay the
Assignor, on the Effective Date, an amount equal to the principal amount of
the portion of all Floating Rate Loans assigned to the Assignee hereunder
and (ii) with respect to each Eurodollar Rate Loan made by the Assignor and
assigned to the Assignee hereunder which is outstanding on the Effective
Date, (a) on the last day of the Interest Period therefor or (b) on such
earlier date agreed to by the Assignor and the Assignee or (c) on the date
on which any such Eurodollar Rate Loan either becomes due (by acceleration
or otherwise) or is prepaid (the date as described in the foregoing clauses
(a), (b) or (c) being hereinafter referred to as the "Payment Date"), the
Assignee shall pay the Assignor an amount equal to the principal amount of
the portion of such Eurodollar Rate Loan assigned to the Assignee which is
outstanding on the Payment Date. If the Assignor and the Assignee agree
that the Payment Date for such Eurodollar Rate Loan shall be the Effective
Date, they shall agree to the interest rate applicable to the portion of
such Loan assigned hereunder for the period from the Effective Date to the
end of the existing Interest Period applicable to such Eurodollar Rate Loan
(the "Agreed Interest Rate") and any interest received by the Assignee in
excess of the Agreed Interest Rate shall be remitted to the Assignor. In
the event interest for the period from the Effective Date to but not
including the Payment Date is not paid by the Company with respect to any
Eurodollar Rate Loan sold by the Assignor to the Assignee hereunder, the
Assignee shall pay to the Assignor interest for such period on the portion
of such Eurodollar Rate Loan sold by the Assignor to the Assignee hereunder
at the applicable rate provided by the Credit Agreement. In the event a
prepayment of any Eurodollar Rate Loan which is existing on the Payment
Date and assigned by the Assignor to the Assignee hereunder occurs after
the Payment Date but before the end of the Interest Period applicable to
such Eurodollar Rate Loan, the Assignee shall remit to the Assignor the
excess of the prepayment penalty paid with respect to the portion of such
Eurodollar Rate Loan assigned to the Assignee hereunder over the amount
which would have been paid if such prepayment penalty was calculated based
on the Agreed Interest Rate. The Assignee will also promptly remit to the
Assignor (i) any principal payments received from the Agent with respect to
Eurodollar Rate Loans prior to the Payment Date and (ii) any amounts of
interest on Loans and fees received from the Agent which relate to the
portion of the Loans assigned to the Assignee hereunder for periods prior
to the Effective Date, in the case of Floating Rate Loans or fees, or the
Payment Date, in the case of Eurodollar Rate Loans, and not previously paid
by the Assignee to the Assignor.] In the event that either party hereto
receives any payment to which the other party hereto is entitled under this
Assignment Agreement, then the party receiving such amount shall promptly
remit it to the other party hereto.
5. FEES PAYABLE BY THE ASSIGNEE. [The Assignee shall pay to the
Assignor a fee on each day on which a payment of interest or commitment
fees is made under the Credit Agreement with respect to the amounts
assigned to the Assignee hereunder (other than a payment of interest or
commitment fees for the period prior to the Effective Date or, in the case
of Eurodollar Rate Loans, the Payment Date, which the Assignee is obligated
to deliver to the
Page 56
Assignor pursuant to Section 4 hereof). The amount of such fee shall be the
difference between (i) the interest or fee, as applicable, paid with
respect to the amounts assigned to the Assignee hereunder and (ii) the
interest or fee, as applicable, which would have been paid with respect to
the amounts assigned to the Assignee hereunder if each interest rate
was____ of 1% less than the interest rate paid by the Company or if the
commitment fee was _____ of 1% less than the commitment fee paid by the
Company, as applicable.] [In addition,] [t]he Assignee agrees to pay ___%
of the recordation fee required to be paid to the Agent in connection with
this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim created by the
Assignor. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor
makes no other representation or warranty of any kind to the Assignee.
Neither the Assignor nor any of its officers, directors, employees, agents
or attorneys shall be responsible for (i) the due execution, legality,
validity, enforceability, genuineness, sufficiency or collectability of any
Loan Document, including without limitation, documents granting the
Assignor and the other Banks a security interest in assets of the Company
or any guarantor, (ii) any representation, warranty or statement made in or
in connection with any of the Loan Documents, (iii) the financial condition
or creditworthiness of the Company or any guarantor, (iv) the performance
of or compliance with any of the terms or provisions of any of the Loan
Documents, (v) inspecting any of the Property, books or records of the
Company, (vi) the validity, enforceability, perfection, priority,
condition, value or sufficiency of any collateral securing or purporting to
secure the Loans or (vii) any mistake, error of judgment, or action taken
or omitted to be taken in connection with the Loans or the Loan Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis
and decision to enter into this Assignment Agreement, (ii) agrees that it
will, independently and without reliance upon the Agent, the Assignor or
any other Bank and based on such documents and information at it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and
authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under the Loan Documents as are delegated to the Agent
by the terms thereof, together with such powers as are reasonably
incidental thereto, (iv) agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents
are required to be performed by it as a Bank, (v) agrees that its payment
instructions and notice instructions are as set forth in the attachment to
Schedule 1, (vi) confirms that none of the funds, monies, assets or other
consideration being used to make the purchase and assumption hereunder are
"plan assets" as defined under ERISA and that its rights, benefits and
interests in
Page 57
and under the Loan Documents will not be "plan assets" under ERISA, [and
(vii) attaches the forms prescribed by the Internal Revenue Service of the
United States certifying that the Assignee is entitled to receive payments
under the Loan Documents without deduction or withholding of any United
States federal income taxes].
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the
Assignor in connection with or arising in any manner from the Assignee's
non-performance of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee
shall have the right pursuant to Section 12.3.1 of the Credit Agreement to
assign the rights which are assigned to the Assignee hereunder to any
entity or person, provided that (i) any such subsequent assignment does not
violate any of the terms and conditions of the Loan Documents or any law,
rule, regulation, order, writ, judgment, injunction or decree and that any
consent required under the terms of the Loan Documents has been obtained
and (ii) unless the prior written consent of the Assignor is obtained, the
Assignee is not thereby released from its obligations to the Assignor
hereunder, if any remain unsatisfied, including, without limitation, its
obligations under Sections 4, 5 and 8 hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement
and the Effective Date, the percentage interest specified in Item 3 of
Schedule 1 shall remain the same, but the dollar amount purchased shall be
recalculated based on the reduced Aggregate Commitment.
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached
Notice of Assignment embody the entire agreement and understanding between
the parties hereto and supersede all prior agreements and understandings
between the parties hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.
13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered)
shall be the address set forth in the attachment to Schedule 1.
Page 58
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above
written.
[NAME OF ASSIGNOR]
By:_______________________________
Title: ___________________________
[NAME OF ASSIGNEE]
By: ____________________________
Title:___________________________
Page 59
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
Credit Agreement by and among Cordant Technologies Inc., The First
National Bank of Chicago, as Administrative Agent, and the Banks party
thereto dated as of February 5, 1999.
2. Date of Assignment Agreement: ______________________ , 19__
3. Amounts (As of Date of Item 2 above):
a. Total of Commitments
(Loans) under
Credit Agreement $___________
b. Assignee's Percentage
of Facility purchased
under the Assignment
Agreement ______ %
c. Amount of Assigned Share in
Facility purchased under
the Assignment
Agreement $_________
4. Assignee's Aggregate (Loan
Amount)* Commitment Amount
Purchased Hereunder: $_________
5. Proposed Effective Date:
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: __________________________________ By: _______________________________
Title:________________________________ Title: ____________________________
Page 60
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee
Page 61
EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
____________, 19__
To: Cordant Technologies Inc.
00 X. Xxxxx Xxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxx, XX 00000
Attn: Treasury Department
The First National Bank of Chicago
Mail Suite IL1-0374
One First Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Transportation Division
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Credit Agreement (the "Credit Agreement")
described in Item 1 of Schedule 1 attached hereto ("Schedule 1").
Capitalized terms used herein and not otherwise defined herein shall have
the meanings attributed to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and
delivered to the Company and the Agent pursuant to Section 12.3.3 of the
Credit Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of , 19 (the "Assignment"), pursuant to which, among
other things, the Assignor has sold, assigned, delegated and transferred to
the Assignee, and the Assignee has purchased, accepted and assumed from the
Assignor the percentage interest specified in Item 3 of Schedule 1 of all
outstandings, rights and obligations under the Credit Agreement relating to
the facilities listed in Item 3 of Schedule 1. The Effective Date of the
Assignment shall be the later of the date specified in Item
Page 62
5 of Schedule 1 or two Business Days (or such shorter period as agreed to
by the Agent) after this Notice of Assignment and any consents and fees
required by Sections 12.3.1, 12.3.2, and 12.3.3 of the Credit Agreement
have been delivered to the Agent, provided that the Effective Date shall
not occur if any condition precedent agreed to by the Assignor and the
Assignee has not been satisfied.
4. The Assignor and the Assignee hereby give to the Company and
the Agent notice of the assignment and delegation referred to herein. The
Assignor will confer with the Agent before the date specified in Item 5 of
Schedule 1 to determine if the Assignment Agreement will become effective
on such date pursuant to Section 3 hereof, and will confer with the Agent
to determine the Effective Date pursuant to Section 3 hereof if it occurs
thereafter. The Assignor shall notify the Agent if the Assignment Agreement
does not become effective on any proposed Effective Date as a result of the
failure to satisfy the conditions precedent agreed to by the Assignor and
the Assignee. At the request of the Agent, the Assignor will give the Agent
written confirmation of the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Agent on or
before the Effective Date the processing fee of $3,500 required by Section
12.3.3 of the Credit Agreement.
6. If Notes are outstanding on the Effective Date, the Assignor
and the Assignee request and direct that the Agent prepare and cause the
Company to execute and deliver new Notes or, as appropriate, replacements
notes, to the Assignor and the Assignee. The Assignor and, if applicable,
the Assignee each agree to deliver to the Agent the original Note received
by it from the Company upon its receipt of a new Note in the appropriate
amount.
7. The Assignee advises the Agent that notice and payment
instructions are set forth in the attachment to Schedule 1.
8. The Assignee hereby represents and warrants that none of the
funds, monies, assets or other consideration being used to make the
purchase pursuant to the Assignment are "plan assets" as defined under
ERISA and that its rights, benefits, and interests in and under the Loan
Documents will not be "plan assets" under ERISA.
Page 63
9. The Assignee authorizes the Agent to act as its agent under the
Loan Documents in accordance with the terms thereof. The Assignee
acknowledges that the Agent has no duty to supply information with respect
to the Company or the Loan Documents to the Assignee until the Assignee
becomes a party to the Credit Agreement.
NAME OF ASSIGNOR NAME OF ASSIGNEE
By: _____________________________ By:________________________________
Title:___________________________ Title:_____________________________
ACKNOWLEDGED AND CONSENTED TO ACKNOWLEDGED AND CONSENTED TO
BY THE FIRST NATIONAL BANK BY CORDANT TECHNOLOGIES INC.
OF CHICAGO
By:______________________________ By:______________________________________
Title: __________________________ Title:___________________________________
[Attach photocopy of Schedule 1 to Assignment]
Page 64
SCHEDULE "1"
SUBSIDIARIES
(SEE SECTION 5.16)
(Ownership interests are 100% unless
otherwise indicated.)
Page 65
SCHEDULE "2"
INDEBTEDNESS OF SUBSIDIARIES
(SEE SECTION 5.16)
Page 66
SCHEDULE "3"
LIENS
(SEE SECTION 6.2.6)
There are no Liens outstanding by the Company or any Subsidiary
except Liens permitted pursuant to Section 6.2.6 of the Credit Agreement.
Page 67
