Exhibit 10(d)
364-DAY $325,000,000 CREDIT AGREEMENT
DATED AS OF NOVEMBER 30, 2001
AMONG
TORCHMARK CORPORATION,
THE LENDERS,
BANK ONE, NA,
AS ADMINISTRATIVE AGENT,
BANK OF AMERICA, N.A.,
AS SYNDICATION AGENT,
FLEET NATIONAL BANK,
AS DOCUMENTATION AGENT
AND
AMSOUTH BANK,
AS DOCUMENTATION AGENT
BANC ONE CAPITAL MARKETS, INC.
JOINT LEAD ARRANGER AND SOLE BOOK MANAGER
BANC OF AMERICA SECURITIES LLC
JOINT LEAD ARRANGER
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS........................................................................ 1
ARTICLE II THE CREDITS........................................................................ 12
2.1 Commitment................................................................................ 12
2.2 Required Payments; Termination............................................................ 12
2.3 Ratable Loans............................................................................. 13
2.4 Types of Advances......................................................................... 13
2.5 Facility Fee; Utilization Fee; Reductions and Increases in Aggregate Commitment........... 13
2.6 Minimum Amount of Each Advance............................................................ 14
2.7 Optional Principal Payments............................................................... 14
2.8 Method of Selecting Types and Interest Periods for New Advances........................... 14
2.9 Conversion and Continuation of Outstanding Advances....................................... 14
2.10 Changes in Interest Rate, etc............................................................. 15
2.11 Rates Applicable After Default............................................................ 15
2.12 Method of Payment......................................................................... 16
2.13 Noteless Agreement; Evidence of Indebtedness.............................................. 16
2.14 Telephonic Notices........................................................................ 17
2.15 Interest Payment Dates; Interest and Fee Basis............................................ 17
2.16 Notification of Advances, Interest Rates, Prepayments and Commitment Reductions........... 17
2.17 Lending Installations..................................................................... 17
2.18 Non-Receipt of Funds by the Agent......................................................... 18
2.19 Replacement of Lender..................................................................... 18
ARTICLE III YIELD PROTECTION; TAXES............................................................ 19
3.1 Yield Protection.......................................................................... 19
3.2 Changes in Capital Adequacy Regulations................................................... 19
3.3 Availability of Types of Advances......................................................... 20
3.4 Funding Indemnification................................................................... 20
3.5 Taxes..................................................................................... 20
3.6 Lender Statements; Survival of Indemnity.................................................. 22
ARTICLE IV CONDITIONS PRECEDENT............................................................... 22
4.1 Initial Advance........................................................................... 22
4.2 Each Advance.............................................................................. 23
ARTICLE V REPRESENTATIONS AND WARRANTIES..................................................... 24
5.1 Corporate Existence and Standing.......................................................... 24
5.2 Authorization and Validity................................................................ 24
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5.3 No Conflict; Government Consent........................................................... 24
5.4 Financial Statements...................................................................... 25
5.5 Material Adverse Change................................................................... 25
5.6 Taxes..................................................................................... 25
5.7 Litigation and Contingent Obligations..................................................... 25
5.8 Subsidiaries.............................................................................. 26
5.9 ERISA..................................................................................... 26
5.10 Accuracy of Information................................................................... 26
5.11 Regulation U.............................................................................. 26
5.12 Material Agreements....................................................................... 26
5.13 Compliance With Laws...................................................................... 26
5.14 Ownership of Properties................................................................... 27
5.15 Investment Company Act.................................................................... 27
5.16 Public Utility Holding Company Act........................................................ 27
5.17 Insurance Licenses........................................................................ 27
5.18 Defaults.................................................................................. 27
ARTICLE VI COVENANTS.......................................................................... 27
6.1 Financial Reporting....................................................................... 27
6.2 Use of Proceeds........................................................................... 29
6.3 Certain Notices........................................................................... 29
6.4 Conduct of Business....................................................................... 30
6.5 Taxes..................................................................................... 30
6.6 Insurance................................................................................. 30
6.7 Compliance with Laws...................................................................... 30
6.8 Maintenance of Properties................................................................. 30
6.9 Inspection................................................................................ 30
6.10 Merger.................................................................................... 31
6.11 Sale of Assets............................................................................ 31
6.12 Sale and Leaseback........................................................................ 31
6.13 Investments and Acquisitions.............................................................. 31
6.14 Liens..................................................................................... 31
6.15 Consolidated Net Worth.................................................................... 31
6.16 Ratio of Consolidated Indebtedness to Consolidated Capitalization......................... 31
6.17 Ratio of Consolidated Adjusted Net Income to Consolidated Interest Expense................ 31
6.18 Affiliates................................................................................ 31
6.19 Series A Preferred Securities............................................................. 32
ARTICLE VII DEFAULTS........................................................................... 32
7.1 Representations........................................................................... 32
7.2 Non-Payment............................................................................... 32
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7.3 Specific Defaults......................................................................... 32
7.4 Other Defaults............................................................................ 32
7.5 Cross-Default............................................................................. 32
7.6 Insolvency; Voluntary Proceedings......................................................... 32
7.7 Involuntary Proceedings................................................................... 33
7.8 Condemnation.............................................................................. 33
7.9 Judgment.................................................................................. 33
7.10 Unfunded Liabilities...................................................................... 33
7.11 Withdrawal Liability...................................................................... 33
7.12 Environmental............................................................................. 33
7.13 Change in Control......................................................................... 34
7.14 Licenses.................................................................................. 34
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES..................................... 34
8.1 Acceleration.............................................................................. 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 Headings.................................................................................. 36
9.4 Entire Agreement.......................................................................... 36
9.5 Several Obligations; Benefits of this Agreement........................................... 36
9.6 Expenses; Indemnification................................................................. 36
9.7 Numbers of Documents...................................................................... 37
9.8 Accounting................................................................................ 37
9.9 Severability of Provisions................................................................ 37
9.10 Nonliability of Lenders................................................................... 37
9.11 Confidentiality........................................................................... 37
9.12 Nonreliance............................................................................... 37
9.13 Disclosure................................................................................ 38
ARTICLE X THE AGENT.......................................................................... 38
10.1 Appointment; Nature of Relationship...................................................... 38
10.2 Powers................................................................................... 38
10.3 General Immunity......................................................................... 38
10.4 No Responsibility for Loans, Recitals, etc............................................... 38
10.5 Action on Instructions of Lenders........................................................ 39
10.6 Employment of Agents and Counsel......................................................... 39
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10.7 Reliance on Documents; Counsel.......................................................... 39
10.8 Agent's Reimbursement and Indemnification............................................... 39
10.9 Notice of Default....................................................................... 40
10.10 Rights as a Lender...................................................................... 40
10.11 Lender Credit Decision.................................................................. 40
10.12 Successor Agent......................................................................... 40
10.13 Agent and Arranger Fees................................................................. 41
10.14 Delegation to Affiliates................................................................ 41
10.15 Documentation Agents, Syndication Agent, etc............................................ 41
ARTICLE XI SETOFF; RATABLE PAYMENTS.......................................................... 42
11.1 Setoff.................................................................................. 42
11.2 Ratable Payments........................................................................ 42
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS................................. 42
12.1 Successors and Assigns.................................................................. 42
12.2 Participations.......................................................................... 43
12.2.1 Permitted Participants; Effect....................................................... 43
12.2.2 Voting Rights........................................................................ 43
12.2.3 Benefit of Setoff.................................................................... 43
12.3 Assignments............................................................................. 43
12.3.1 Permitted Assignments................................................................ 43
12.3.2 Effect; Effective Date............................................................... 44
12.4 Dissemination of Information............................................................ 44
12.5 Tax Treatment........................................................................... 44
ARTICLE XIII NOTICES........................................................................... 45
13.1 Notices................................................................................. 45
13.2 Change of Address....................................................................... 45
ARTICLE XIV COUNTERPARTS...................................................................... 45
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL...................... 45
15.1 CHOICE OF LAW........................................................................... 45
15.2 CONSENT TO JURISDICTION................................................................. 45
15.3 WAIVER OF JURY TRIAL.................................................................... 46
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Schedules
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Pricing Schedule
Schedule 1 Significant Subsidiaries
Schedule 2 Insurance Licenses
Exhibits
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Exhibit A Note
Exhibit B Compliance Certificate
Exhibit C Assignment
Exhibit D Money Transfer Instructions
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364-DAY CREDIT AGREEMENT
This Agreement, dated as of November 30, 2001, is among Torchmark
Corporation, the Lenders and Bank One, NA, a national banking association having
its principal office in Chicago, Illinois, as Agent. The parties hereto agree as
follows:
RECITALS
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A. The Borrower has requested the Lenders to make financial
accommodations to it in the aggregate principal amount of up to $325,000,000,
the proceeds of which will be used for the general corporate purposes of the
Borrower and its Subsidiaries (including repayment of maturing commercial paper
Indebtedness); and
B. The Lenders are willing to extend such financial accommodations on the
terms and conditions set forth herein.
ARTICLE I
DEFINITIONS
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As used in this Agreement:
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of a
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the outstanding
partnership interests of a partnership.
"Advance" means a borrowing hereunder, (i) made by the Lenders on the same
Borrowing Date, or (ii) converted or continued by the Lenders on the same date
of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurodollar
Loans, for the same Interest Period.
"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.
"Agent" means Bank One in its capacity as contractual representative of the
Lenders pursuant to Article X, and not in its individual capacity as a Lender,
and any successor Agent appointed pursuant to Article X.
"Agent Balance Transaction" means one or more receivables sales
transactions with respect to receivables arising out of advances made by AIL to
insurance agents in connection with life insurance policies underwritten by AIL.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced or increased from time to time pursuant to the terms hereof.
"Agreement" means this credit agreement, as it may be amended or modified
and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"AIL" means American Income Life Insurance Company, an Indiana insurance
company.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of the
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Annual Statement" means the annual statutory financial statement of any
Insurance Subsidiary required to be filed with the insurance commissioner (or
similar authority) of its jurisdiction of incorporation, which statement shall
be in the form required by such Insurance Subsidiary's jurisdiction of
incorporation or, if no specific form is so required, in the form of financial
statements recommended by the NAIC to be used for filing annual statutory
financial statements and shall contain the type of information recommended by
the NAIC to be disclosed therein, together with all exhibits or schedules filed
therewith.
"Applicable Facility Fee Rate" means, at any time, the percentage
determined in accordance with the Pricing Schedule at such time. The Applicable
Facility Fee Rate shall change as and when the Borrower Debt Rating changes. The
initial Applicable Facility Fee Rate shall be .09%.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Applicable Utilization Fee Rate" means, at any time, the percentage
determined in accordance with the Pricing Schedule at such time. The Applicable
Utilization Fee Rate shall change as and when the Borrower Debt Rating changes.
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"Arrangers" means (i) Banc One Capital Markets, Inc., a Delaware
corporation, and its successors, in its capacity as Joint Lead Arranger and Sole
Book Runner and (ii) Banc of America Securities LLC, a Delaware corporation, and
its successors, in its capacity as Joint Lead Arranger.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the Chairman, Vice Chairman, President,
Chief Financial Officer, Chief Accounting Officer, Treasurer, any Vice President
or any Assistant Treasurer of the Borrower, acting singly.
"Bank One" means Bank One, NA, a national banking association having its
principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Borrower" means Torchmark Corporation, a Delaware corporation, and its
successors and assigns.
"Borrower Debt Rating" means the senior unsecured long term debt (without
third party credit enhancement) rating of the Borrower as determined by a rating
agency identified on the Pricing Schedule.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (within the meaning of Rule
13d-3 of the Securities and
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Exchange Commission under the Securities Exchange Act of 1934) of 20% or more of
the outstanding shares of voting stock of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to make
Loans not exceeding the amount set forth opposite its name on the signature
pages hereto, as it may be modified as a result of any assignment that has
become effective pursuant to Section 12.3.2 or as otherwise modified from time
to time pursuant to the terms hereof.
"Condemnation" is defined in Section 7.8.
"Consolidated Adjusted Net Income" means, for any period of calculation,
Consolidated Net Income plus (to the extent deducted in determining Consolidated
Net Income) (i) the provision for taxes in respect of, or measured by, income or
excess profits and (ii) Consolidated Interest Expense, in each case calculated
for such period for the Borrower and its Subsidiaries on a consolidated basis in
accordance with Agreement Accounting Principles.
"Consolidated Capitalization" means, at any date of determination, the sum
of (i) Consolidated Net Worth as at such date plus (ii) Consolidated
Indebtedness as at such date.
"Consolidated Indebtedness" means the Indebtedness of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with Agreement
Accounting Principles.
"Consolidated Interest Expense" means, for any period of calculation,
interest expense, whether paid or accrued, of the Borrower and its Subsidiaries
calculated on a consolidated basis in accordance with Agreement Accounting
Principles.
"Consolidated Net Income" means, for any period of calculation, the net
income of the Borrower and its Subsidiaries calculated on a consolidated basis
in accordance with Agreement Accounting Principles consistently applied.
"Consolidated Net Worth" means, at any date of determination, the amount of
consolidated common and preferred shareholders' equity of the Borrower and its
Subsidiaries (including, without limitation, the Preferred Securities),
determined as at such date in accordance with Agreement Accounting Principles;
provided, however, that the effect of the application of FAS 115 shall be
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excluded when computing Consolidated Net Worth.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay
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contract or application for a Letter of Credit, but excluding (i) the
endorsement of instruments for deposit or collection in the ordinary course of
business, (ii) the Payment and Guarantee Agreements and (iii) obligations
arising in connection with the Agent Balance Transaction.
"Controlled Group" means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.9.
"Default" means an event described in Article VII.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise provided
in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars appearing on Reuters Screen FRBD as
of 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, and having a maturity equal to such Interest Period, provided
that, (i) if Reuters Screen FRBD is not available to the Agent for any reason,
the applicable Eurodollar Base Rate for the relevant Interest Period shall
instead be the applicable British Bankers' Association Interest Settlement Rate
for deposits in U.S. dollars as reported by any other generally recognized
financial information service as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, and (ii) if no such British Bankers' Association Interest
Settlement Rate is available to the Agent, the applicable Eurodollar Base Rate
for the relevant Interest Period shall instead be the rate determined by the
Agent to be the rate at which Bank One or one of its Affiliate banks offers to
place deposits in U.S. dollars with first-class banks in the London interbank
market at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period, in the approximate amount of Bank One's
relevant Eurodollar Loan and having a maturity equal to such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin.
"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i)
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the jurisdiction under the laws of which such Lender or the Agent is
incorporated or organized or (ii) the jurisdiction in which the Agent's or such
Lender's principal executive office or such Lender's applicable Lending
Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another document
is specifically referenced.
"Existing Credit Agreements" means that certain Credit Agreement dated as
of October 22, 1997 among the Borrower, Bank One, as agent, and the lenders
named therein, and that certain Letter of Credit Agreement dated as of October
24, 2000 among the Borrower, TMK Re and Bank One, as agent and issuer, and the
participants named therein, in each case as amended, restated, supplemented or
otherwise modified from time to time.
"Facility Termination Date" means November 28, 2003 or any earlier date on
which the Aggregate Commitment is reduced to zero or otherwise terminated
pursuant to the terms hereof.
"Federal Funds Effective 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 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Five Year Agreement" means that certain Five Year Credit Agreement dated
as of the date hereof among the Borrower, TMK, Re, Bank One, as agent, and the
lenders party thereto, as from time to time amended, restated or modified.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the Floating Rate.
"Governmental Authority" means the federal government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government
including, without limitation, any board of insurance, insurance department or
insurance commissioner.
"Indebtedness" of a Person means, without duplication, such Person's (i)
obligations for borrowed money, (ii) obligations representing the deferred
purchase price of Property or services
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(excluding accounts payable arising in the ordinary course of such Person's
business payable on terms customary in the trade and obligations of Insurance
Subsidiaries arising under insurance or annuity products), (iii) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or similar instruments,
(v) Capitalized Lease Obligations, (vi) net liabilities under interest rate
swap, exchange or cap agreements, (vii) obligations for which such Person is
obligated, contingently or otherwise, pursuant to or in respect of any Letter of
Credit (including any unreimbursed amount in respect thereof) and (viii)
Contingent Obligations, but excluding any indebtedness of the Borrower arising
under or in connection with the Series A Preferred Securities Loan Agreement or
the Junior Subordinated Debenture Purchase Agreement.
"Insurance Subsidiary" means any Subsidiary of the Borrower which is
engaged in the life, health or accident insurance business.
"Interest Period" means, with respect to a Eurodollar Advance, a period of
one, two, three or six months commencing on a Business Day selected by the
Borrower pursuant to this Agreement. Such Interest Period shall end on the day
which corresponds numerically to such date one, two, three or six months
thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth 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 calendar month, such Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade), deposit
account or contribution of capital by such Person to any other Person or any
investment in, or purchase or other acquisition of, the stock, partnership
interests, notes, debentures or other securities of any other Person made by
such Person.
"Junior Subordinated Debenture Purchase Agreement" means the Junior
Subordinated Debenture Purchase Agreement dated as of November 2, 2001 between
the Borrower and Torchmark Capital Trust I entered into in connection with the
Trust Preferred Securities, as in effect on November 2, 2001.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, the
office, branch, subsidiary or affiliate of such Lender or the Agent listed on
the signature pages hereof or on a Schedule or otherwise selected by such Lender
or the Agent pursuant to Section 2.17.
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"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"License" means any license, certificate of authority, permit or other
authorization which is required to be obtained from a Governmental Authority in
connection with the operation, ownership or transaction of insurance business.
"Lien" means any lien (statutory or other), security interest, mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, the interest of a
vendor or lessor under any conditional sale, Capitalized Lease or other title
retention agreement but excluding rights in agent balances which are sold in an
Agent Balance Transaction).
"Loan" means, with respect to a Lender, such Lender's loan made pursuant to
Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, any Notes issued hereunder and the
other documents, certificates and agreements contemplated hereby and executed by
the Borrower in favor of the Agent or any Lender.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents, or
(iii) the validity or enforceability of any of the Loan Documents or the rights
or remedies of the Agent or the Lenders thereunder.
"Modified Required Lenders" means Lenders in the aggregate having at least
75% of the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, Lenders in the aggregate holding at least 75% of the aggregate
unpaid principal amount of the outstanding Advances.
"Moody's" means Xxxxx'x Investors Service, Inc., a Delaware corporation,
together with any Person succeeding thereto by merger, consolidation or
acquisition of all or substantially all of its assets, including substantially
all of its business of rating securities.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"NAIC" means the National Association of Insurance Commissioners or any
successor thereto, or in lieu thereof, any other association, agency or other
organization performing advisory, coordination or other like functions among
insurance departments, insurance commissions and similar Governmental
Authorities of the various states of the United States of America toward the
promotion of uniformity in the practices of such Governmental Authorities.
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"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" is defined in Section 2.13(iv).
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Loans, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders or to any
Lender, the Agent or any indemnified party arising under the Loan Documents.
"Other Taxes" is defined in Section 3.5(ii).
"Participants" is defined in Section 12.2.1.
"Payment and Guarantee Agreements" means, to the extent outstanding,
collectively, (i) the Payment and Guarantee Agreement dated October 11, 1994,
issued by the Borrower for the benefit of the holders of the Series A Preferred
Securities, without giving effect to any amendments thereto and (ii) the
Preferred Securities Guarantee Agreement dated November 2, 2001, issued by the
Borrower for the benefit of the holders of the Trust Preferred Securities,
without giving effect to any amendments thereto.
"Payment Date" means the last day of each March, June, September and
December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Acquisition" means the Acquisition of any Person which has been
approved and recommended by the board of directors (or the functional equivalent
thereof) of the Person being acquired.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Preferred Securities" means, to the extent outstanding, collectively, the
Series A Preferred Securities and the Trust Preferred Securities.
"Pricing Schedule" means the Schedule attached hereto identified as such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
-9-
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto 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 as from time to time in effect and 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 and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within thirty
(30) days of the occurrence of such event; provided, however, that a failure to
-------- -------
meet the minimum funding standard of Section 412 of the Code and of Section 302
of ERISA shall be a Reportable Event regardless of the issuance of any such
waiver of the notice requirement in accordance with either Section 4043(a) of
ERISA or Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 51% of
the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 51% of the aggregate unpaid principal
amount of the outstanding Advances.
"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 28, 2002 or any earlier
date on which the Aggregate Commitment is reduced to zero or otherwise
terminated pursuant to the terms hereof.
"SAP" means, with respect to any Insurance Subsidiary, the statutory
accounting practices prescribed or permitted by the insurance commissioner (or
other similar authority) as of the Closing Date in the jurisdiction of
incorporation of such Insurance Subsidiary for the preparation of annual
statements and other financial reports by insurance companies of the same type
as such Insurance Subsidiary.
-10-
"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Series A Preferred Securities" means the 9.18% Preferred Securities,
Series A, issued by Torchmark Capital L.L.C. on October 11, 1994.
"Series A Preferred Securities Loan Agreement" means the Loan Agreement
dated as of October 11, 1994 between the Borrower and Torchmark Capital L.L.C.
entered into in connection with the Series A Preferred Securities, as in effect
on October 11, 1994.
"Significant Insurance Subsidiary" means any Significant Subsidiary which
is an Insurance Subsidiary.
"Significant Subsidiary" of a Person means a "significant subsidiary" as
defined in Rule 1-02(v) of Regulation S-X of the Securities and Exchange
Commission (17 CFR Part 210). Unless otherwise expressly provided, all
references herein to a "Significant Subsidiary" shall mean a Significant
Subsidiary of the Borrower.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"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 Borrower.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made, or (ii) is responsible for more than 10% of the
consolidated net sales or of the consolidated net income of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause (i)
above.
"Taxes" means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes and Other Taxes.
-11-
"TMK Re" means TMK Re, Ltd., a Bermuda reinsurance corporation and Wholly
Owned Subsidiary of the Borrower.
"Transferee" is defined in Section 12.4.
"Trust Preferred Securities" means the 7 3/4% Trust Preferred Securities
issued by Torchmark Capital Trust I on November 2, 2001.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested nonforfeitable benefits under all Single Employer Plans exceeds
the fair market value of all such Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, association, joint venture, limited
liability company or similar business organization 100% 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
"Wholly-Owned Subsidiary" shall mean a Wholly-Owned Subsidiary of the Borrower.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
ARTICLE II
THE CREDITS
-----------
2.1 Commitment. From and including the date of this Agreement and prior to
----------
the Revolving Credit Termination Date, each Lender severally agrees, on the
terms and conditions set forth in this Agreement, to make Loans to the Borrower
from time to time in amounts not to exceed in the aggregate at any one time
outstanding the amount of its Commitment. Subject to the terms of this
Agreement, the Borrower may borrow, repay and reborrow at any time prior to the
Revolving Credit Termination Date. The Commitments to lend hereunder shall
expire on the Revolving Credit Termination Date. Principal payments made after
the Revolving Credit Termination Date may not be reborrowed.
2.2 Required Payments; Termination. The Revolving Credit Termination
------------------------------
Balance, any outstanding Advances and all other unpaid Obligations shall be paid
in full by the Borrower on the Facility Termination Date.
-12-
2.3 Ratable Loans. Each Advance hereunder shall consist of Loans made from
-------------
the several Lenders ratably in proportion to the ratio that their respective
Commitments bear to the Aggregate Commitment.
2.4 Types of Advances. The Advances may be Floating Rate Advances or
-----------------
Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.8 and 2.9.
2.5 Facility Fee; Utilization Fee; Reductions and Increases in Aggregate
--------------------------------------------------------------------
Commitment. (a) The Borrower agrees to pay to the Agent for the account of each
----------
Lender a facility fee at a per annum rate equal to the Applicable Facility Fee
Rate on such Lender's Commitment (or, after the Revolving Credit Termination
Date, on the principal amount of such Lender's Loans) from the date hereof to
and including the Facility Termination Date, payable on each Payment Date
hereafter and on the Facility Termination Date. The Borrower also agrees to pay
to the Agent for the ratable (based on Commitment (or after termination of the
Commitments, outstanding Loan) amounts) account of the Lenders a utilization fee
for each day from the date hereof to and including the later of the Facility
Termination Date and the date all Loans are paid in full and all Commitments are
terminated, such utilization fee to be equal to the Applicable Utilization Fee
Rate for such day multiplied by the outstanding principal amount of the Loans on
such day, payable on each Payment Date and on the Facility Termination Date. The
Borrower may permanently reduce the Aggregate Commitment in whole, or in part
ratably among the Lenders in integral multiples of $10,000,000, upon at least
three Business Days' written notice to the Agent, which notice shall specify the
amount of any such reduction, provided, however, that the amount of the
Aggregate Commitment may not be reduced below the aggregate principal amount of
the outstanding Advances. All accrued facility and utilization fees shall be
payable on the effective date of any termination of the obligations of the
Lenders to make Loans hereunder.
(b) The Borrower may, at its option, on up to two occasions, seek to
increase the Aggregate Commitment by up to an aggregate amount of $75,000,000
(resulting in a maximum Aggregate Commitment of $400,000,000) upon at least
three (3) Business Days' prior written notice to the Agent, which notice shall
specify the amount of any such increase and shall be delivered at a time when no
Default or Unmatured Default has occurred and is continuing. The Borrower may,
after giving such notice, offer the increase (which may be declined by any
Lender in its sole discretion) in the Aggregate Commitment on either a ratable
basis to the Lenders or on a non pro-rata basis to one or more Lenders and/or to
other Lenders or entities reasonably acceptable to the Agent. No increase in the
Aggregate Commitment shall become effective until the existing or new Lenders
extending such incremental Commitment amount and the Borrower shall have
delivered to the Agent a document in form reasonably satisfactory to the Agent
pursuant to which any such existing Lender states the amount of its Commitment
increase, any such new Lender states its Commitment amount and agrees to assume
and accept the obligations and rights of a Lender hereunder and the Borrower
accepts such incremental Commitments. The Lenders (new or existing) shall accept
an assignment from the existing Lenders, and the existing Lenders shall make an
assignment to the new or existing Lender accepting a new or increased
Commitment, of an interest in each then outstanding Advance such
-13-
that, after giving effect thereto, all Advances are held ratably by the Lenders
in proportion to their respective Commitments. Assignments pursuant to the
preceding sentence shall be made in exchange for the principal amount assigned
plus accrued and unpaid interest, facility fees and utilization fees. The
Borrower shall make any payments under Section 3.4 resulting from such
-----------
assignments. Any such increase of the Aggregate Commitment shall be
subject to receipt by the Agent from the Borrower of such supplemental opinions,
resolutions, certificates and other documents as the Agent may reasonably
request.
2.6 Minimum Amount of Each Advance. Each Advance shall be in the minimum
------------------------------
amount of $5,000,000 (and in multiples of $1,000,000 if in excess thereof);
provided, however, that any Floating Rate Advance may be in the amount of the
unused Aggregate Commitment.
2.7 Optional Principal Payments. The Borrower may from time to time pay,
---------------------------
without penalty or premium, 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 Agent. The Borrower may from time to time
pay, subject to the payment of any funding indemnification amounts required by
Section 3.4 but without penalty or premium, all outstanding Eurodollar 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 Eurodollar Advances
upon three Business Days' prior notice to the Agent.
2.8 Method of Selecting Types and Interest Periods for New Advances. The
---------------------------------------------------------------
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Advance, the Interest Period applicable thereto from time to time. The Borrower
shall give the Agent irrevocable notice (a "Borrowing Notice") not later than
10:00 a.m. (Chicago time) at least one Business Day before the Borrowing Date of
each Floating Rate Advance and three Business Days before the Borrowing Date for
each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than noon (Chicago time) on each Borrowing Date, each Lender
shall make available its Loan or Loans in funds immediately available in Chicago
to the Agent at its address specified pursuant to Article XIII. The Agent will
make the funds so received from the Lenders available to the Borrower at the
Agent's aforesaid address.
2.9 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 Advances pursuant to this Section
2.9 or are repaid in accordance with
-14-
Section 2.7. Each Eurodollar Advance shall continue as a Eurodollar Advance
until the end of the then applicable Interest Period therefor, at which time
such Eurodollar Advance shall be automatically converted into a Floating Rate
Advance unless (x) such Eurodollar Advance is or was repaid in accordance with
Section 2.7 or (y) the Borrower shall have given the Agent a
Conversion/Continuation Notice (as defined below) requesting that, at the end of
such Interest Period, such Eurodollar Advance continue as a Eurodollar Advance
for the same or another Interest Period. Subject to the terms of Section 2.6,
the Borrower may elect from time to time to convert all or any part of a
Floating Rate Advance into a Eurodollar Advance. The Borrower shall give the
Agent irrevocable notice (a "Conversion/Continuation Notice") of each conversion
of a Floating Rate Advance into a Eurodollar Advance or continuation of a
Eurodollar Advance not later than 10:00 a.m. (Chicago time) at least three
Business Days 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 of such Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the Interest Period
applicable thereto.
2.10 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 automatically converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9, to but
excluding the date it is paid or is converted into a Eurodollar Advance pursuant
to Section 2.9 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 Alternate Base Rate. Each Eurodollar Advance shall bear interest on the
outstanding principal amount thereof 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 Eurodollar Rate determined by the Agent as applicable to
such Eurodollar Advance based upon the Borrower's selections under Sections 2.8
and 2.9 and otherwise in accordance with the terms hereof. No Interest Period
may end after the Facility Termination Date. The Borrower shall select Interest
Periods so that it is not necessary to repay any portion of a Eurodollar Advance
prior to the last day of the applicable Interest Period in order to make a
mandatory repayment required pursuant to Section 2.2.
2.11 Rates Applicable After Default. Notwithstanding anything to the
------------------------------
contrary contained in Section 2.8 or 2.9, during the continuance of a Default or
Unmatured Default no Advance may be made as, converted into or continued as a
Eurodollar Advance. During the continuance of a Default the Required Lenders
may, at their option, by notice to the Borrower (which notice may be revoked at
the option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Eurodollar Advance shall bear interest for the remainder
of the applicable
-15-
Interest Period at the Eurodollar Rate otherwise applicable to such Interest
Period plus 2% per annum and (ii) each Floating Rate Advance shall bear interest
at a rate per annum equal to the Floating Rate in effect from time to time plus
2% per annum, provided that, during the continuance of a Default under Section
7.6 or 7.7, the interest rates set forth in clauses (i) and (ii) above shall be
applicable to all Advances without any election or action on the part of the
Agent or any Lender.
2.12 Method of Payment. All payments of the Obligations hereunder shall be
-----------------
made, without setoff, deduction, or counterclaim, in immediately available funds
to the Agent at the Agent's address specified pursuant to Article XIII, or at
any other Lending Installation of the Agent specified in writing by the Agent to
the Borrower, by noon (local time) on the date when due and shall be applied
ratably by the Agent among the Lenders. Each payment delivered to the Agent for
the account of any Lender shall be delivered promptly by the Agent to such
Lender in the same type of funds that the Agent received at its address
specified pursuant to Article XIII or at any Lending Installation specified in a
notice received by the Agent from such Lender. The Agent is hereby authorized to
charge the account of the Borrower maintained with Bank One for each payment of
principal, interest and fees as it becomes due hereunder.
2.13 Noteless Agreement; Evidence of Indebtedness. (i) Each Lender shall
--------------------------------------------
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record
(a) the amount of each Loan made hereunder, the Type thereof and the
Interest Period with respect thereto, (b) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to
each Lender hereunder and (c) the amount of any sum received by the Agent
hereunder from the Borrower and each Lender's share thereof.
(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the
existence and amounts of the Obligations therein recorded; provided,
however, that the failure of the Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Obligations in accordance with their terms.
(iv) Any Lender may request that its Loans be evidenced by a
promissory note in substantially the form of Exhibit A (including any
amendment, modification, renewal or replacement thereof, a "Note"). In
such event, the Borrower shall prepare, execute and deliver to such Lender
such Note payable to the order of such Lender. Thereafter, the Loans
evidenced by such Note and interest thereon shall at all times (including
after any assignment pursuant to Section 12.3) be represented by one or
more Notes payable to the order of the payee named therein or any assignee
pursuant to Section 12.3, except to the extent that any such Lender or
assignee subsequently returns any such Note for cancellation and requests
that such Loans once again be evidenced as described in
-16-
paragraphs (i) and (ii) above. Upon receipt of an affidavit of an officer
of any Lender as to the loss, theft, destruction or mutilation of such
Lender's Note, and, in the case of any such loss, theft destruction or
mutilation, upon cancellation of such Note, the Borrower will issue, in
lieu thereof, a replacement Note in the same principal amount thereof and
otherwise of like tenor.
2.14 Telephonic Notices. The Borrower hereby authorizes the Lenders and the
------------------
Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
2.15 Interest Payment Dates; Interest and Fee Basis. Interest accrued on
----------------------------------------------
each Floating Rate Advance shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof, on any date on which
the Floating Rate Advance is prepaid, whether due to acceleration or otherwise,
and at maturity. Interest accrued on that portion of the outstanding principal
amount of any Floating Rate Advance converted into a Eurodollar Advance on a day
other than a Payment Date shall be payable on the date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Interest Period, on any date on which the Eurodollar Advance is
prepaid, whether by acceleration or otherwise, and at maturity. Interest accrued
on each Eurodollar 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, facility and utilization fees shall be calculated for
actual days elapsed on the basis of a 360-day year. 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 noon (local time) at the place of payment.
If any payment of principal of or interest on an Advance 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, such extension
of time shall be included in computing interest in connection with such payment.
2.16 Notification of Advances, Interest Rates, Prepayments and Commitment
--------------------------------------------------------------------
Reductions. Promptly after receipt thereof, the Agent will notify each Lender
----------
of the contents of each Aggregate Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by it hereunder.
The Agent will notify each Lender of the Eurodollar Rate applicable to each
Eurodollar Advance promptly upon determination of such interest rate and will
give each Lender prompt notice of each change in the Alternate Base Rate.
2.17 Lending Installations. Each Lender may book its Loans at any Lending
---------------------
Installation selected by such Lender and may change its Lending Installation
from time to time. All terms of this Agreement shall apply to any such Lending
Installation and the Loans and any
-17-
Notes issued hereunder shall be deemed held by each Lender for the benefit of
any such Lending Installation. Each Lender may, by written notice to the Agent
and the Borrower in accordance with Article XIII, designate replacement or
additional Lending Installations through which Loans will be made by it and for
whose account Loan payments are to be made.
2.18 Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender, as
---------------------------------
the case may be, notifies the Agent prior to the date on which it is scheduled
to make payment to the Agent of (i) in the case of a Lender, the proceeds of a
Loan or (ii) in the case of the Borrower, a payment of principal, interest or
fees to the Agent for the account of the Lenders, that it does not intend to
make such payment, the Agent may assume that such payment has been made. The
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
Lender or the Borrower, as the case may be, has not in fact made such payment to
the Agent, the recipient of such payment shall, on demand by the Agent, repay to
the 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 Agent until the date the Agent recovers such amount at a rate
per annum equal to (x) in the case of payment by a Lender, the Federal Funds
Effective Rate for such day for the first three days and, thereafter, the
interest rate applicable to the relevant Loan or (y) in the case of payment by
the Borrower, the interest rate applicable to the relevant Loan.
2.19 Replacement of Lender. If the Borrower is required pursuant to
---------------------
Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any
Lender's obligation to make or continue, or to convert Floating Rate Advances
into, Eurodollar Advances shall be suspended pursuant to Section 3.3 (any Lender
so affected an "Affected Lender"), the Borrower may elect, if such amounts
continue to be charged or such suspension is still effective, to replace such
Affected Lender as a Lender party to this Agreement, provided that no Default or
Unmatured Default shall have occurred and be continuing at the time of such
replacement, and provided further that, concurrently with such replacement, (i)
another bank or other entity which is reasonably satisfactory to the Borrower
and the Agent shall agree, as of such date, to purchase for cash the Advances
and other Obligations due to the Affected Lender pursuant to an assignment
substantially in the form of Exhibit C and to become a Lender for all purposes
under this Agreement and to assume all obligations of the Affected Lender to be
terminated as of such date and to comply with the requirements of Section 12.3
applicable to assignments, and (ii) the Borrower shall pay to such Affected
Lender in same day funds on the day of such replacement (A) all interest, fees
and other amounts then accrued but unpaid to such Affected Lender by the
Borrower hereunder to and including the date of termination, including without
limitation payments due to such Affected Lender under Sections 3.1, 3.2 and 3.5,
and (B) an amount, if any, equal to the payment which would have been due to
such Lender on the day of such replacement under Section 3.4 had the Loans of
such Affected Lender been prepaid on such date rather than sold to the
replacement Lender.
-18-
ARTICLE III
YIELD PROTECTION; TAXES
-----------------------
3.1 Yield Protection. If, on or after the date of this Agreement, the
----------------
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) subjects any Lender or any applicable Lending Installation to
any Taxes, or changes the basis of taxation of payments (other than with
respect to Excluded Taxes) to any Lender in respect of its Eurodollar
Loans, 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 Lender or any applicable Lending Installation (other than reserves
and assessments taken into account in determining the interest rate
applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation of making,
funding or maintaining its Eurodollar Loans or reduces any amount
receivable by any Lender or any applicable Lending Installation in
connection with its Eurodollar Loans, or requires any Lender or any
applicable Lending Installation to make any payment calculated by reference
to the amount of Eurodollar Loans held or interest received by it, by an
amount deemed material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation of making or maintaining its Eurodollar Loans or
Commitment or to reduce the return received by such Lender or applicable Lending
Installation in connection with such Eurodollar Loans or Commitment, then,
within 15 days of demand by such Lender, the Borrower shall pay such Lender such
additional amount or amounts as will compensate such Lender for such increased
cost or reduction in amount received.
3.2 Changes in Capital Adequacy Regulations. If a Lender determines the
---------------------------------------
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion of such increased capital
which such Lender determines is attributable to this Agreement, its Loans or its
Commitment to make Loans hereunder (after taking into account such Lender's
policies as to capital adequacy). "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
-19-
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 Lender or any Lending Installation or any corporation
controlling any Lender. "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 "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 Types of Advances. If any Lender determines that
---------------------------------
maintenance of its Eurodollar 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 Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be repaid or converted to Floating Rate
Advances, subject to the payment of any funding indemnification amounts required
by Section 3.4.
3.4 Funding Indemnification. If any payment of a Eurodollar 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 Advance is not
made on the date specified by the Borrower for any reason other than default by
the Lenders, the Borrower will indemnify each Lender 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 such
Eurodollar Advance.
3.5 Taxes. 3.5.1 (i) All payments by the Borrower to or for the account of
-----
any Lender or the Agent hereunder or under any Note shall be made free and clear
of and without deduction for any and all Taxes. If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender or the Agent, (a) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 3.5) such Lender or the
Agent (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (b) the Borrower shall make such
deductions, (c) the Borrower shall pay the full amount deducted to the relevant
authority in accordance with applicable law and (d) the Borrower shall furnish
to the Agent the original copy of a receipt evidencing payment thereof within 30
days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or
under any Note or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note ("Other Taxes").
-20-
(iii) The Borrower hereby agrees to indemnify the Agent and each
Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed on amounts payable under this
Section 3.5) paid by the Agent or such Lender and any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto. Payments due under this indemnification shall be made within 30
days of the date the Agent or such Lender makes demand therefor pursuant to
Section 3.6.
(iv) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof (each a "Non-U.S. Lender")
agrees that it will, not more than ten Business Days after the date of this
Agreement, (i) deliver to each of the Borrower and the Agent two duly
completed copies of United States Internal Revenue Service Form W-8BEN or
W-8ECI, certifying in either case that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any
United States federal income taxes, and (ii) deliver to each of the
Borrower and the Agent a United States Internal Revenue Form W-8 or W-9, as
the case may be, and certify that it is entitled to an exemption from
United States backup withholding tax. Each Non-U.S. Lender further
undertakes to deliver to each of the Borrower and the Agent (x) renewals or
additional copies of such form (or any successor form) on or before the
date that such form expires or becomes obsolete, and (y) after the
occurrence of any event requiring a change in the most recent forms so
delivered by it, such additional forms or amendments thereto as may be
reasonably requested by the Borrower or the Agent. All forms or amendments
described in the preceding sentence shall certify that such Lender is
entitled to receive payments under this Agreement 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 Lender from duly completing and delivering any such form or amendment
with respect to it and such Lender advises the Borrower and the Agent that
it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to
provide the Borrower with an appropriate form pursuant to clause (iv),
above (unless such failure is due to a change in treaty, law or regulation,
or any change in the interpretation or administration thereof by any
governmental authority, occurring subsequent to the date on which a form
originally was required to be provided), such Non-U.S. Lender shall not be
entitled to indemnification under this Section 3.5 with respect to Taxes
imposed by the United States; provided that, should a Non-U.S. Lender which
is otherwise exempt from or subject to a reduced rate of withholding tax
become subject to Taxes because of its failure to deliver a form required
under clause (iv), above, the Borrower shall take such steps as such Non-
U.S. Lender shall reasonably request to assist such Non-U.S. Lender to
recover such Taxes.
-21-
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Note
pursuant to the law of any relevant jurisdiction or any treaty shall
deliver to the Borrower (with a copy to the Agent), at the time or times
prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to
be made without withholding or at a reduced rate.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political
subdivision thereof asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because
the appropriate form was not delivered or properly completed, because such
Lender failed to notify the Agent of a change in circumstances which
rendered its exemption from withholding ineffective, or for any other
reason), such Lender shall indemnify the Agent fully for all amounts paid,
directly or indirectly, by the Agent as tax, withholding therefor, or
otherwise, including penalties and interest, and including taxes imposed by
any jurisdiction on amounts payable to the Agent under this subsection,
together with all reasonable costs and expenses related thereto (including
reasonable attorneys fees and reasonable time charges of attorneys for the
Agent, which attorneys may be employees of the Agent). The obligations of
the Lenders under this Section 3.5(vii) shall survive the payment of the
Obligations and termination of this Agreement.
3.6 Lender Statements; Survival of Indemnity. To the extent reasonably
----------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of
Eurodollar Advances under Section 3.3, so long as such designation is not, in
the judgment of such Lender, disadvantageous to such Lender. Each Lender shall
deliver a written statement of such Lender to the Borrower (with a copy to the
Agent) as to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such
written statement shall set forth in reasonable detail the calculations upon
which such Lender determined such amount and shall be final, conclusive and
binding on the Borrower in the absence of manifest error. Determination of
amounts payable under such Sections in connection with a Eurodollar Loan shall
be calculated as though each Lender funded its Eurodollar 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 written statement of any Lender shall be payable on
demand after receipt by the Borrower of such written statement. The obligations
of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of
the Obligations and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
--------------------
4.1 Initial Advance. The Lenders shall not be required to make the
---------------
initial Advance hereunder unless the Borrower has furnished to the Agent with
sufficient copies for the Lenders:
-22-
(i) Copies of the restated certificate of incorporation of the
Borrower certified by the Secretary or an Assistant Secretary of the
Borrower, together with good standing certificates issued as of a recent
date by the Secretaries of State of Delaware and Alabama.
(ii) Copies, certified by the Secretary or an Assistant Secretary of
the Borrower, of its by-laws and Board of Directors' resolutions
authorizing the execution of the Loan Documents.
(iii) An incumbency certificate, executed by the Secretary or an
Assistant Secretary of the Borrower, which shall identify by name and title
and bear the signature of the officers of the Borrower authorized to sign
the Loan Documents and to make borrowings hereunder, upon which certificate
the Agent and the Lenders shall be entitled to rely until informed of any
change in writing by the Borrower.
(iv) A certificate, signed by the Chief Financial Officer or the
Treasurer of the Borrower, stating that on the date hereof (a) no Default
or Unmatured Default has occurred and is continuing and (b) each of the
representations and warranties set forth in Article V of this Agreement is
true and correct as of such date.
(v) A written opinion of Xxxxx X. Xxxxxxxxx, Executive Vice
President and General Counsel of the Borrower, addressed to the Agent and
the Lenders in form and substance reasonably satisfactory to the Agent and
its counsel.
(vi) Notes payable to the order of each of the Lenders requesting
the same.
(vii) Written money transfer instructions, in substantially the form
of Exhibit "D" hereto, addressed to the Agent and signed by an Authorized
Officer, together with such other related money transfer authorizations as
the Agent may have reasonably requested.
(viii) The Existing Credit Agreements shall have been terminated and
all amounts owing thereunder (including principal, interest and accrued
fees) shall have been paid (or shall contemporaneously be paid) in full,
and all reimbursement obligations in respect of letter of credit issued
thereunder shall have been terminated.
(ix) Such other documents as any Lender or its counsel may have
reasonably requested.
4.2 Each Advance. The Lenders shall not be required to make any Advance
------------
unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are
true and correct as of such Borrowing Date (excluding the representation in
Section 5.5) except to
-23-
the extent any such representation or warranty is stated to relate solely
to an earlier date, in which case such representation or warranty shall
have been true and correct on and as of such earlier date.
(iii) All legal matters incident to the making of such Advance shall
be satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute a
representation and warranty by the Borrower that the conditions contained in
Sections 4.2(i) and (ii) have been satisfied. Any Lender may require a duly
completed compliance certificate in substantially the form of Exhibit B as a
condition to making an Advance.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders that:
5.1 Corporate Existence and Standing. Each of the Borrower and its
--------------------------------
Significant Subsidiaries is a corporation duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of incorporation and has
all requisite authority to conduct its business in each jurisdiction in which
its business is conducted.
5.2 Authorization and Validity. The Borrower has the corporate power and
--------------------------
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by the Borrower
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 Borrower enforceable
against the Borrower 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 No Conflict; Government Consent. Neither the execution and delivery
-------------------------------
by the Borrower of the Loan Documents, nor 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 Borrower or any of its Subsidiaries or the Borrower's or any of
its Subsidiaries' articles of incorporation or by-laws or the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries 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 in, of or on the Property of the Borrower or
any of its Subsidiaries pursuant to the terms of any such indenture, instrument
or agreement, other than such violations, conflicts or defaults which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect. 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 in connection with the execution, delivery
and
-24-
performance of, or the legality, validity, binding effect or enforceability of,
any of the Loan Documents.
5.4 Financial Statements. The December 31, 2000 audited consolidated
--------------------
financial statements of the Borrower and its Subsidiaries and the September 30,
2001 unaudited consolidated financial statements of the Borrower and its
Subsidiaries heretofore delivered to the Lenders (the "Financial Statements")
were prepared in accordance with generally accepted accounting principles in
effect on the date such statements were prepared and fairly present the
consolidated financial condition and operations of the Borrower and its
Subsidiaries at such dates and the consolidated results of their operations for
the periods then ended.
5.5 Material Adverse Change. As of the date hereof, since December 31,
-----------------------
2000, there has been no change in the business, Property, prospects, condition
(financial or otherwise) or results of operations of the Borrower and its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect.
5.6 Taxes. The Borrower and its 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 Borrower or any of its Subsidiaries, except such taxes, if any,
as are being contested in good faith and as to which, in the good faith judgment
of the Borrower, adequate reserves have been provided. The United States income
tax returns of the Borrower and its Subsidiaries have been audited by the
Internal Revenue Service through the fiscal year ended December 31, 1995. No tax
liens have been filed and no claims against the Borrower or its Subsidiaries are
being asserted with respect to any such taxes except claims being contested in
good faith and as to which, in the good faith judgment of the Borrower, adequate
reserves have been provided. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are adequate in the good faith judgment of the Borrower.
5.7 Litigation and Contingent Obligations. There is no litigation,
-------------------------------------
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect (after giving effect to reserves which have been
provided with respect thereto on the books of the Borrower and its
Subsidiaries). As of the date hereof, the Borrower has no material Contingent
Obligations not provided for or disclosed in the Financial Statements. Solely
for purposes of any reaffirmation of the foregoing representations pursuant to
Section 4.2(ii) in connection with any Loans the proceeds of which are used to
repay maturing commercial paper Indebtedness, such representations shall not
extend to any proceeding in which a punitive damages judgment has been entered
against the Borrower or any Subsidiary, such judgment has been stayed on appeal
or the time for appeal from such judgment has not expired and such judgment
could not reasonably be expected to have a material adverse effect on the
ability of the Borrower to perform its obligations under the Loan Documents.
-25-
5.8 Subsidiaries. Schedule "1" hereto contains an accurate list of all of
------------
the Significant Subsidiaries of the Borrower in existence on the date of this
Agreement, setting forth their respective jurisdictions of incorporation and the
percentage of their respective capital stock owned by the Borrower or other
Subsidiaries. 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.
5.9 ERISA. The Unfunded Liabilities of all Single Employer Plans do not in
-----
the aggregate exceed $10,000,000. Each Plan complies in all material respects
with all applicable requirements of law and regulations. No Reportable Event has
occurred with respect to any Plan and neither the Borrower nor any other members
of the Controlled Group has withdrawn from any Plan or initiated steps to do so,
which occurrence or withdrawal could result in a Material Adverse Effect. No
steps have been taken to terminate any Plan which has Unfunded Liabilities.
5.10 Accuracy of Information. No information, exhibit or repor furnished by
-----------------------
the Borrower or any of its Subsidiaries to the Agent or to any Lender in
connection with the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact, omitted to state a material fact or
omitted to state any fact necessary to make the statements contained therein not
misleading in any material respect.
5.11 Regulation U. Margin stock (as defined in Regulation U) constitutes
------------
less than 25% of those assets of the Borrower and its Subsidiaries which are
subject to any limitation on sale, pledge or other restriction hereunder.
5.12 Material Agreements. Neither the Borrower nor any Subsidiary is a
-------------------
party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect. Neither the
Borrower nor any Significant Subsidiary is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any agreement or instrument evidencing or governing Indebtedness.
5.13 Compliance With Laws. The Borrower and its Subsidiaries have complied
--------------------
with all applicable statutes, rules, regulations, orders and restrictions of any
domestic or foreign government or any instrumentality or agency thereof, having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Property, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. Neither the Borrower
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 or the
subject of any federal or state investigation evaluating whether any remedial
action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, which non-compliance or remedial action could
reasonably be expected to have a Material Adverse Effect.
-26-
5.14 Ownership of Properties. Except for Liens permitted by Section 6.14,
-----------------------
on the date of this Agreement the Borrower and its Subsidiaries have good title
to all of the Property and assets reflected in the Financial Statements as owned
by it, free of all Liens other than those permitted by this Agreement, except
for assets sold, transferred or otherwise disposed of in the ordinary course of
business since the date of such Financial Statements.
5.15 Investment Company Act. Neither the Borrower nor any Subsidiary
----------------------
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
5.16 Public Utility Holding Company Act. Neither the Borrower nor any
----------------------------------
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.17 Insurance Licenses. Schedule "2" attached hereto (as said Schedule "2"
------------------
shall be revised or supplemented from time to time to reflect withdrawals or
changes in jurisdictions permitted by Section 6.4 or additional jurisdictions
set forth in the Annual Statements furnished pursuant to Section 6.1(vii)) lists
all of the jurisdictions in which any Significant Insurance Subsidiary holds
active Licenses and is authorized to transact insurance business. No such
License is the subject of a proceeding for suspension or revocation, there is no
sustainable basis for such suspension or revocation, and to the Borrower's best
knowledge, no such suspension or revocation has been threatened by any
Governmental Authority. Schedule "2" also indicates the type or types of
insurance in which each such Insurance Subsidiary is permitted to engage with
respect to each License therein listed. None of the Insurance Subsidiaries
transacts any insurance business, directly or indirectly, in any state other
than those enumerated in Schedule "2".
5.18 Defaults. No Default or Unmatured Default has occurred and is
--------
continuing.
ARTICLE VI
COVENANTS
---------
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Financial Reporting. The Borrower will maintain, for itself and each
-------------------
Subsidiary, a system of accounting established and administered in accordance
with generally accepted accounting principles, and furnish to the Lenders:
(i) Within 90 days after the close of each of its fiscal years, an
unqualified audit report certified by independent certified public
accountants, acceptable to the Lenders, prepared in accordance with
Agreement Accounting Principles on a consolidated and consolidating basis
(consolidating statements need not be certified by such accountants) for
itself and its Subsidiaries, including balance sheets as of the end of such
period, related profit and loss and reconciliation of surplus statements,
and a
-27-
statement of cash flows, accompanied by a certificate of said accountants
that, in the course of their examination necessary for their certification
of the foregoing, they have obtained no knowledge of any Default or
Unmatured Default, or if, in the opinion of such accountants, any Default
or Unmatured Default shall exist, stating the nature and status thereof.
(ii) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and its Subsidiaries,
consolidated and consolidating unaudited balance sheets as at the close of
each such period and consolidated and consolidating profit and loss
statements and a statement of cash flows for the period from the beginning
of such fiscal year to the end of such quarter, all certified by its Chief
Financial Officer, Chief Accounting Officer or Treasurer.
(iii) Together with the financial statements required hereunder, a
compliance certificate in substantially the form of Exhibit "B" hereto
signed by the Chief Financial Officer, Chief Accounting Officer or
Treasurer of the Borrower showing the calculations necessary to determine
compliance with this Agreement and stating that no Default or Unmatured
Default exists, or if any Default or Unmatured Default exists, stating the
nature and status thereof.
(iv) Within 330 days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single Employer Plan,
certified as correct by an actuary enrolled under ERISA.
(v) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred with respect to any
Plan, a statement, signed by the Chief Financial Officer, Chief Accounting
Officer, Treasurer or Vice President of the Borrower, describing said
Reportable Event and the action which the Borrower proposes to take with
respect thereto.
(vi) As soon as possible and in any event within 10 days after
receipt by the Borrower, a copy of (a) any notice or claim to the effect
that the Borrower or any of its Subsidiaries is or may be liable to any
Person as a result of the release by the Borrower, any of its Subsidiaries,
or any other Person of any toxic or hazardous waste or substance into the
environment, and (b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or regulation by the
Borrower or any of its Subsidiaries, which, in the case of either (a) or
(b) above, could reasonably be expected to have a Material Adverse Effect.
(vii) Within 75 days after the close of each fiscal year of each
Insurance Subsidiary, copies of the Annual Statement of each of the
Insurance Subsidiaries, as certified by the president, secretary and
treasurer of and the actuary for each such Insurance Subsidiary and
prepared on the NAIC annual statement blanks (or such other form as shall
be required by the jurisdiction of incorporation of each such Insurance
Subsidiary), all such statements to be prepared in accordance with SAP
consistently
-28-
applied throughout the periods reflected therein and to be certified by
independent certified public accountants reasonably acceptable to the Agent
if so required by any Governmental Authority.
(viii) Promptly upon the filing thereof, copies of all Forms 10-Q,
10-K and 8-K which the Borrower or any Subsidiary files with the Securities
and Exchange Commission and, together with copies of each Form 10-K so
furnished, a list of such revisions to Schedule "1", if any, as shall be
necessary to cause Schedule "1" to accurately set forth all then existing
Significant Subsidiaries of the Borrower, their respective jurisdictions of
incorporation and the percentage of their respective capital stock owned by
the Borrower or other Subsidiaries.
(ix) Promptly upon the Borrower's receipt thereof, copies of reports
or valuations prepared by any Governmental Authority or actuary in respect
of any action or event which has resulted in the reduction by 5% or more in
the capital and surplus of any Insurance Subsidiary.
(x) Promptly and in any event within ten days after learning thereof,
notification of any decrease after the Closing Date in the rating given by
A.M. Best & Co. in respect of any Insurance Subsidiary.
(xi) Such other information (including, without limitation, non-
financial information) as the Agent or any Lender may from time to time
reasonably request.
6.2 Use of Proceeds. The Borrower will, and will cause each Subsidiary
---------------
to, use the proceeds of the Advances (i) for general corporate purposes,
including, without limitation, the repayment of maturing commercial paper
Indebtedness and (ii) to finance Permitted Acquisitions. The Borrower will not,
nor will it permit any Subsidiary to, use any of the proceeds of the Advances to
purchase or carry any "margin stock" (as defined in Regulation U).
6.3 Certain Notices. The Borrower will give prompt notice in writing to
---------------
the Agent and the Lenders of (i) the occurrence of any Default or Unmatured
Default and of any other development, financial or otherwise, relating
specifically to the Borrower which could reasonably be expected to have a
Material Adverse Effect, (ii) the receipt of any notice from any Governmental
Authority of the expiration without renewal, revocation or suspension of, or the
institution of any proceedings to revoke or suspend, any License now or
hereafter held by any Insurance Subsidiary which is required to conduct
insurance business in compliance with all applicable laws and regulations, other
than such expiration, revocation or suspension which, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect,
(iii) the receipt of any notice from any Governmental Authority of the
institution of any disciplinary proceedings against or in respect of any
Insurance Subsidiary, or the issuance of any order, the taking of any action or
any request for an extraordinary audit for cause by any Governmental Authority
which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect or (iv) any judicial or administrative order limiting or
controlling the insurance business of any Insurance Subsidiary (and not the
insurance industry generally) which
-29-
has been issued or adopted and which could reasonably be expected to have a
Material Adverse Effect. Any such notice shall state that it is given pursuant
to this Section 6.3.
6.4 Conduct of Business. The Borrower will, and will cause each
-------------------
Significant 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 in which its business is conducted. The
Borrower will cause each Significant Insurance Subsidiary to (i) carry on or
otherwise be associated with the business of a licensed insurance carrier and
(ii) do all things necessary to renew, extend and continue in effect all
Licenses which may at any time and from time to time be necessary for such
Significant Insurance Subsidiary to operate its insurance business in compliance
with all applicable laws and regulations; provided, however, that any such
-------- -------
Significant Insurance Subsidiary may withdraw from one or more states as an
admitted insurer or change the state of its domicile, if such withdrawal or
change is in the best interests of the Borrower and such Significant Insurance
Subsidiary and could not reasonably be expected to have a Material Adverse
Effect.
6.5 Taxes. The Borrower will, and will cause each Subsidiary to, pay when
-----
due all taxes, assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside.
6.6 Insurance. The Borrower will, and will cause each Subsidiary to,
---------
maintain with financially sound and reputable insurance companies insurance on
all or substantially all of its Property, or shall maintain self-insurance, in
such amounts and covering such risks as is consistent with sound business
practice for Persons in substantially the same industry as the Borrower or such
Subsidiary, and the Borrower will furnish to any Lender upon request full
information as to the insurance carried.
6.7 Compliance with Laws. The Borrower will, and will cause each
--------------------
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except
where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect.
6.8 Maintenance of Properties. The Borrower will, and will cause each
-------------------------
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times, except where the
failure to so maintain, preserve, protect and repair could not reasonably be
expected to have a Material Adverse Effect.
6.9 Inspection. The Borrower will, and will cause each Subsidiary to,
----------
permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, corporate books and financial records of
the Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each
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Subsidiary, and to discuss the affairs, finances and accounts of the Borrower
and each Subsidiary with, and to be advised as to the same by, their respective
officers upon reasonable notice and at such reasonable times and intervals as
the Lenders may designate
6.10 Merger. The Borrower will not, nor will it permit any Subsidiary to,
------
merge or consolidate with or into any other Person, except that (i) a Subsidiary
may merge with the Borrower or a Wholly-Owned Subsidiary and (ii) the Borrower
and any Subsidiary may merge or consolidate with or into any other Person
provided that the Borrower or such Subsidiary shall be the continuing or
surviving corporation and, after giving effect to such merger or consolidation,
no Default or Unmatured Default shall exist.
6.11 Sale of Assets. The Borrower will not, nor will it permit any
--------------
Subsidiary to, lease, sell or otherwise dispose of all or a Substantial Portion
of its Property (exclusive of Investments sold in the ordinary course of
business) to any other Person(s) in any calendar year.
6.12 Sale and Leaseback. The Borrower will not, nor will it permit any
------------------
Subsidiary to, sell or transfer a Substantial Portion of its Property in order
to concurrently or subsequently lease as lessee such or similar Property.
6.13 Investments and Acquisitions. The Borrower will not make, and will
----------------------------
not permit any Subsidiary to make, any Acquisitions except Permitted
Acquisitions.
6.14 Liens. The Borrower will not, nor will it permit any Subsidiary to,
-----
create, incur, or suffer to exist any Lien in, of or on its Property other than
Liens securing in the aggregate not more than $100,000,000 of Indebtedness.
6.15 Consolidated Net Worth. The Borrower will maintain at all times
----------------------
Consolidated Net Worth equal to not less than the sum of (i) $2,216,253,000 plus
(ii) 25% of the Borrower's Consolidated Net Income, if positive, for each fiscal
quarter ending after September 30, 2001.
6.16 Ratio of Consolidated Indebtedness to Consolidated Capitalization.
-----------------------------------------------------------------
The Borrower will maintain at all times a ratio of Consolidated Indebtedness to
Consolidated Capitalization of not greater than .4 to 1.0.
6.17 Ratio of Consolidated Adjusted Net Income to Consolidated Interest
------------------------------------------------------------------
Expense. The Borrower will maintain, as at the last day of each fiscal quarter,
-------
a ratio of (i) Consolidated Adjusted Net Income to (ii) Consolidated Interest
Expense, in each case calculated for the four fiscal quarters then ending, of
not less than 3.0 to 1.0.
6.18 Affiliates. The Borrower 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 (other than a Wholly-Owned Subsidiary) except (i) any such
transactions, payments or transfers with or to such Affiliates as are made in
the ordinary course of business and pursuant to the reasonable requirements of
the Borrower's or such Subsidiary's business and upon fair and reasonable terms
no less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a
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comparable arms-length transaction and (ii) any such other transactions,
payments or transfers with or to such Affiliates as could not reasonably be
expected to have a Material Adverse Effect.
6.19 Preferred Securities. The Borrower will not, and will not permit
--------------------
Torchmark Capital L.L.C. or Torchmark Capital Trust I to, declare or pay
dividends or distributions on, or redeem, purchase or otherwise acquire, any
Preferred Securities or any portion thereof if, after giving effect thereto, a
Default or Unmatured Default would exist.
ARTICLE VII
DEFAULTS
--------
The occurrence of any one or more of the following events shall constitute
a Default:
7.1 Representations. Any representation or warranty made or deemed made
---------------
by or on behalf of the Borrower or any of its Subsidiaries to the Lenders or the
Agent under or in connection with this Agreement, any Loan, or any certificate
or information delivered in connection with this Agreement or any other Loan
Document shall be materially false or misleading on the date as of which made.
7.2 Non-Payment. Nonpayment of any principal of any Loan when due, or
-----------
nonpayment of any interest upon any Loan or of any facility fee, utilization fee
or other obligations under any of the Loan Documents within five days after the
same becomes due.
7.3 Specific Defaults. The breach by the Borrower of any of the terms or
-----------------
provisions of Section 6.2, 6.3, 6.10, 6.11, 6.12, 6.13, 6.15, 6.16, 6.17 or
6.19; or the breach by the Borrower of any of the terms or provisions of Section
6.14 or 6.18 which is not remedied within ten days after the Borrower learns
thereof.
7.4 Other Defaults. The breach by the Borrower (other than a breach which
--------------
constitutes a Default under Section 7.1, 7.2 or 7.3) of any of the terms or
provisions of this Agreement which is not remedied within twenty days after
written notice from the Agent or any Lender.
7.5 Cross-Default. Failure of the Borrower or any of its Subsidiaries to
-------------
pay when due any Indebtedness in excess of, singly or in the aggregate for all
such Subsidiaries, $10,000,000; or the default by the Borrower or any of its
Subsidiaries in the performance of any term, provision or condition contained in
any agreement under which any such Indebtedness was created or is governed, or
any other event shall occur or condition exist, the effect of which 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 any such
Indebtedness of the Borrower or any Subsidiary 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.
7.6 Insolvency; Voluntary Proceedings. The Borrower or any of its
---------------------------------
Subsidiaries shall (i) have an order for relief entered with respect to it under
the Federal bankruptcy laws as now or hereafter in effect, (ii) make an
assignment for the benefit of creditors, (iii) apply for, seek,
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consent to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any Substantial Portion of
its Property, (iv) institute any proceeding seeking an order for relief under
the Federal bankruptcy laws as now or hereafter in effect 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, (v) take any
corporate action to authorize or effect any of the foregoing actions set forth
in this Section 7.6, (vi) fail to contest in good faith any appointment or
proceeding described in Section 7.7 or not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.7 Involuntary Proceedings. Without the application, approval or consent
-----------------------
of the Borrower or any of its Subsidiaries, a receiver, trustee, examiner,
liquidator or similar official shall be appointed for the Borrower or any of its
Subsidiaries or any Substantial Portion of its Property, or a proceeding
described in Section 7.6(iv) shall be instituted against the Borrower or any of
its Subsidiaries and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of 30 consecutive days.
7.8 Condemnation. Any court, government or governmental agency shall
------------
condemn, seize or otherwise appropriate, or take custody or control of (each a
"Condemnation"), all or any portion of the Property of the Borrower or any of
its Subsidiaries which, when taken together with all other Property of the
Borrower and its Subsidiaries so condemned, seized, appropriated, or taken
custody or control of, during the twelve-month period ending with the month in
which any such Condemnation occurs, constitutes a Substantial Portion of its
Property.
7.9 Judgment. The Borrower or any of its Subsidiaries shall fail within
--------
45 days to pay, bond or otherwise discharge any judgment or order for the
payment of money, either singly or in the aggregate, in excess of $10,000,000,
which is not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10 Unfunded Liabilities. The Unfunded Liabilities of all Single Employer
--------------------
Plans shall exceed in the aggregate $10,000,000 or any Reportable Event shall
occur in connection with any Plan.
7.11 Withdrawal Liability. The Borrower or any other member of the
--------------------
Controlled Group shall have been notified by the sponsor of a Multiemployer Plan
that it has incurred withdrawal liability to such Multiemployer Plan in an
amount which, when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Borrower or any other member of the Controlled Group
as withdrawal liability (determined as of the date of such notification),
exceeds $5,000,000 or requires payments exceeding $500,000 per annum.
7.12 Environmental. The Borrower or any of its Subsidiaries shall be the
-------------
subject of any proceeding or investigation pertaining to the release by the
Borrower or any of its Subsidiaries or any other person of any toxic or
hazardous waste or substance into the environment, or any violation of any
federal, state or local environmental, health or safety law or
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regulation, which, in either case, could reasonably be expected to have a
Material Adverse Effect.
7.13 Change in Control. Any Change in Control shall occur.
-----------------
7.14 Licenses. Any License of any Insurance Subsidiary held by such
--------
Insurance Subsidiary on the Closing Date or acquired by such Insurance
Subsidiary thereafter, the loss of which would have, in the reasonable judgment
of the Lenders, a Material Adverse Effect, (i) shall be revoked by a final non-
appealable order by the state which shall have issued such License, or any
action (whether administrative or judicial) to revoke such License shall have
been commenced against such Insurance Subsidiary which shall not have been
dismissed or contested in good faith within 30 days of the commencement thereof,
(ii) shall be suspended by such state for a period in excess of 30 days or (iii)
shall not be reissued or renewed by such state upon the expiration thereof
following application for such reissuance or renewal by such Insurance
Subsidiary.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1 Acceleration. If any Default described in Section 7.6 or 7.7 occurs
------------
with respect to the Borrower, the obligations of the Lenders to make Loans
hereunder shall automatically terminate and the Obligations shall immediately
become due and payable without any election or action on the part of the Agent
or any Lender. If any other Default occurs, the Required Lenders (or the Agent
with the consent of the Required Lenders) may terminate or suspend the
obligations of the Lenders to make Loans hereunder, or declare the Obligations
to be due and payable, or both, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives.
If, before any judgment or decree for the payment of the Obligations due
shall have been obtained or entered, the Modified Required Lenders (or, in the
case of an automatic termination upon the occurrence of a Default under Section
7.6 or 7.7, all the Lenders), in their sole discretion, shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such acceleration
and/or termination.
8.2 Amendments. Subject to the provisions of this Article VIII, the
----------
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or thereunder
or waiving any Default hereunder or thereunder; provided, however, that no such
-------- -------
supplemental agreement shall, without the consent of each Lender:
(i) Extend the Facility Termination Date or the Revolving Credit
Termination Date, compromise or forgive the principal amount of any Loan,
or reduce the rate of
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interest or compromise or forgive payment of interest on any Loan, or
reduce the amount of any fee payable hereunder.
(ii) Reduce the percentage specified in the definition of Required
Lenders or Modified Required Lenders.
(iii) Increase the amount of the Commitment of any Lender hereunder
(except pursuant to Section 2.5(b)), or permit the Borrower to assign its
rights under this Agreement.
(iv) Amend this Section 8.2.
No amendment of any provision of this Agreement relating to the Agent shall
be effective without the written consent of the Agent. The Agent may waive
payment of the fee required under Section 12.3.2 without obtaining the consent
of any other party to this Agreement.
Notwithstanding the foregoing, upon the execution and delivery of all
documentation required by Section 2.5(b) to be delivered in connection with an
increase to the Aggregate Commitment, the Agent, the Borrower and the new or
existing Lenders whose Commitments have been affected may and shall enter into
an amendment hereof (which shall be binding on all parties hereto) solely for
the purpose of reflecting any new Lenders and their new Commitments and any
increase in the Commitment of any existing Lender.
8.3 Preservation of Rights. No delay or omission of the Lenders or the
----------------------
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 the
making of a Loan notwithstanding the existence of a Default or the inability of
the Borrower to satisfy the conditions precedent to such Loan shall not
constitute any waiver or acquiescence. 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 Lenders 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 Agent and the Lenders until the Obligations have been paid in
full.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1 Survival of Representations. All representations and warranties of
---------------------------
the Borrower contained in this Agreement shall survive the making of the Loans
herein contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to the
-----------------------
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
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9.3 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.
9.4 Entire Agreement. The Loan Documents embody the entire agreement and
----------------
understanding among the Borrower, the Agent and the Lenders and supersede all
prior agreements and understandings among the Borrower, the Agent and the
Lenders relating to the subject matter thereof other than the fee letter
described in Section 10.13.
9.5 Several Obligations; Benefits of this Agreement. The respective
-----------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arrangers shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6 Expenses; Indemnification. The Borrower shall reimburse the Agent for
-------------------------
any costs, internal charges and out-of-pocket expenses (including reasonable
attorneys' fees and time charges of attorneys for the Agent, which attorneys may
be employees of the Agent) paid or incurred by the Agent in connection with the
preparation, negotiation, execution, delivery, review, amendment, modification,
and administration of the Loan Documents. The Borrower also agrees to reimburse
the Agent, the Arrangers and the Lenders for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time charges of attorneys
for the Agent, the Arrangers and the Lenders, which attorneys may be employees
of the Agent, the Arrangers or the Lenders) paid or incurred by the Agent, any
Arranger or any Lender in connection with the collection of the Obligations or
the enforcement of the Loan Documents. The Borrower further agrees to indemnify
the Agent, the Arrangers and each Lender, its directors, officers and employees
against all losses, claims, damages, penalties, judgments, liabilities and
expenses (collectively, the "indemnified obligations") (including, without
limitation, all expenses of litigation or preparation therefor whether or not
the Agent, any Arranger or any Lender is a party thereto, but excluding those
indemnified obligations arising solely from any Lender's failure to perform its
obligations under this Agreement) which any of them may pay or incur 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, except that no indemnified
party shall be indemnified for any indemnified obligations arising from its own
gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction. The obligations of the Borrower under this Section 9.6
shall survive the termination of this Agreement.
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9.7 Numbers of Documents. All statements, notices, closing documents, and
--------------------
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.
9.8 Accounting. Except as provided to the contrary herein, all accounting
----------
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
9.9 Severability of Provisions. Any provision in any Loan Document that
--------------------------
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10 Nonliability of Lenders. The relationship between the Borrower on the
-----------------------
one hand and the Lenders and the Agent on the other hand shall be solely that of
borrower and lender. Neither the Agent, any Arranger nor any Lender shall have
any fiduciary responsibilities to the Borrower. Neither the Agent, any Arranger
nor any Lender undertakes any responsibility to the Borrower to review or inform
the Borrower of any matter in connection with any phase of the Borrower's
business or operations. The Borrower agrees that neither the Agent, any Arranger
nor any Lender shall have liability to the Borrower (whether sounding in tort,
contract or otherwise) for losses suffered by the Borrower in connection with,
arising out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
occurring in connection therewith, unless it is determined in a final non-
appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, any Arranger nor any Lender shall have
any liability with respect to, and the Borrower hereby waives, releases and
agrees not to xxx for, any special, indirect, consequential or punitive damages
suffered by the Borrower in connection with, arising out of, or in any way
related to the Loan Documents or the transactions contemplated thereby.
9.11 Confidentiality. Each Lender agrees to hold any confidential
---------------
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii)
permitted by Section 12.4.
9.12 Nonreliance. Each Lender hereby represents that it is not relying on
-----------
or looking to any margin stock (as defined in Regulation U) for the repayment of
the Loans provided for herein.
-37-
9.13 Disclosure. The Borrower and each Lender hereby acknowledge and agree
----------
that Bank One and/or its Affiliates from time to time may hold investments in,
make other loans to or have other relationships with the Borrower and its
Affiliates.
ARTICLE X
THE AGENT
---------
10.1 Appointment; Nature of Relationship. Bank One, NA is hereby appointed
-----------------------------------
by each of the Lenders as its contractual representative (herein referred to as
the "Agent") hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of Section 1-201 of the Uniform Commercial Code and (iii) is acting
as an independent contractor, the rights and duties of which are limited to
those expressly set forth in this Agreement and the other Loan Documents. Each
of the Lenders hereby agrees to assert no claim against the Agent on any agency
theory or any other theory of liability for breach of fiduciary duty, all of
which claims each Lender hereby waives.
10.2 Powers. The Agent shall have and may exercise such powers under the
------
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3 General Immunity. Neither the Agent nor any of its directors,
----------------
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4 No Responsibility for Loans, Recitals, etc. Neither the Agent nor any
-------------------------------------------
of its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into, or verify (a) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to
-38-
the Agent; (d) the existence or possible existence of any Default or Unmatured
Default; (e) the validity, enforceability, effectiveness, sufficiency or
genuineness of any Loan Document or any other instrument or writing furnished in
connection therewith; (f) the value, sufficiency, creation, perfection or
priority of any Lien in any collateral security; or (g) the financial condition
of the Borrower or any guarantor of any of the Obligations or of any of the
Borrower's or any such guarantor's respective Subsidiaries. The Agent shall have
no duty to disclose to the Lenders information that is not required to be
furnished by the Borrower to the Agent at such time, but is voluntarily
furnished by the Borrower to the Agent (either in its capacity as Agent or in
its individual capacity).
10.5 Action on Instructions of Lenders. The Agent shall in all cases be
---------------------------------
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders pro rata against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.
10.6 Employment of Agents and Counsel. The Agent may execute any of its
--------------------------------
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, 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 Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7 Reliance on Documents; Counsel. The 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 Agent, which counsel
may be employees of the Agent.
10.8 Agent's Reimbursement and Indemnification. The Lenders agree to
-----------------------------------------
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities,
-39-
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against the Agent in any way relating to or arising
out of the Loan Documents or any other document delivered in connection
therewith or the transactions contemplated thereby (including, without
limitation, for any such amounts incurred by or asserted against the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, provided that (i) no Lender shall be
liable for any of the foregoing to the extent any of the foregoing is found in a
final non-appealable judgment by a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of the Agent and (ii)
any indemnification required pursuant to Section 3.5(vii) shall, notwithstanding
the provisions of this Section 10.8, be paid by the relevant Lender in
accordance with the provisions thereof. The obligations of the Lenders under
this Section 10.8 shall survive payment of the Obligations and termination of
this Agreement.
10.9 Notice of Default. The Agent shall not be deemed to have knowledge
-----------------
or notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or the Borrower referring to
this Agreement describing such Default or Unmatured Default and stating that
such notice is a "notice of default". In the event that the Agent receives such
a notice, the Agent shall give prompt notice thereof to the Lenders.
10.10 Rights as a Lender. In the event the Agent is a Lender, the Agent
------------------
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11 Lender Credit Decision. Each Lender acknowledges that it has,
----------------------
independently and without reliance upon the Agent, the Arrangers or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent, the Arrangers or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
10.12 Successor Agent. The Agent may resign at any time by giving written
---------------
notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the
-40-
retiring Agent gives notice of its intention to resign. The Agent may be removed
at any time with or without cause by written notice received by the Agent from
the Required Lenders, such removal to be effective on the date specified by the
Required Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint, on behalf of the Borrower and the Lenders, a
successor Agent. If no successor Agent shall have been so appointed by the
Required Lenders within thirty days after the resigning Agent's giving notice of
its intention to resign, then the resigning Agent may appoint, on behalf of the
Borrower and the Lenders, a successor Agent. Notwithstanding the previous
sentence, the Agent may at any time without the consent of the Borrower or any
Lender, appoint any of its Affiliates which is a commercial bank as a successor
Agent hereunder. If the Agent has resigned or been removed and no successor
Agent has been appointed, the Lenders may perform all the duties of the Agent
hereunder and the Borrower shall make all payments in respect of the Obligations
to the applicable Lender and for all other purposes shall deal directly with the
Lenders. No successor Agent shall be deemed to be appointed hereunder until such
successor Agent has accepted the appointment. Any such successor Agent shall be
a commercial bank having capital and retained earnings of at least $100,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent,
such successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article X shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 10.12, then the term "Prime Rate" as used in this Agreement shall mean
the prime rate, base rate or other analogous rate of the new Agent.
10.13 Agent and Arranger Fees. The Borrower agrees to pay to the Agent
-----------------------
and Banc One Capital Markets, Inc., for their respective accounts, the fees
agreed to by the Borrower, the Agent and Banc One Capital Markets, Inc. pursuant
to that certain letter agreement dated October 16, 2001, or as otherwise agreed
from time to time.
10.14 Delegation to Affiliates. The Borrower and the Lenders agree that
------------------------
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
10.15 Documentation Agents, Syndication Agent, etc. None of the Lenders
--------------------------------------------
identified in this Agreement as the "Documentation Agents" or the "Syndication"
Agent shall have any right, power, obligation, liability, responsibility or duty
under this Agreement other than those applicable to all Lenders as such.
Without limiting the foregoing, none of such Lenders shall have or be deemed to
have a fiduciary relationship with any Lender. Each Lender hereby makes the same
acknowledgments with respect to such Lenders as it makes with respect to the
Agent in Section 10.11.
-41-
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1 Setoff. In addition to, and without limitation of, any rights of the
------
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Obligations owing to such
Lender, whether or not the Obligations, or any part thereof, shall then be due.
11.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
----------------
payment made to it upon its Loans (other than payments received pursuant to
Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that received by any
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made.
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 Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. The parties to this Agreement acknowledge that clause (ii) of
this Section 12.1 relates only to absolute assignments and does not prohibit
assignments creating security interests, including, without limitation, (x) any
pledge or assignment by any Lender of all or any portion of its rights under
this Agreement and any Note to a Federal Reserve Bank or (y) in the case of a
Lender which is a fund, any pledge or assignment of all or any portion of its
rights under this Agreement and any Note to its trustee in support of its
obligations to its trustee; provided, however, that no such pledge or assignment
creating a security interest shall release the transferor Lender from its
obligations hereunder unless and until the parties thereto have complied with
the provisions of Section 12.3. The Agent may treat the Person which made any
Loan or which holds any Note as the owner thereof for all purposes hereof unless
and until such Person complies with Section 12.3; provided, however, that the
Agent may in its discretion (but shall not be required to) follow instructions
from the Person which made any Loan or which holds any Note to direct payments
relating to such Loan or Note to another Person. Any assignee of the rights to
any Loan or any Note agrees by acceptance of such assignment to be bound by all
the terms and provisions of the Loan Documents. Any request, authority or
consent
-42-
of any Person, who at the time of making such request or giving such
authority or consent is the owner of the rights to any Loan (whether or not a
Note has been issued in evidence thereof), shall be conclusive and binding on
any subsequent holder or assignee of the rights to such Loan.
12.2 Participations.
--------------
12.2.1 Permitted Participants; Effect. Any Lender 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 Lender, any Note held by
such Lender, any Commitment of such Lender or any other interest of such
Lender under the Loan Documents. In the event of any such sale by a Lender
of participating interests to a Participant, such Lender's obligations
under the Loan Documents shall remain unchanged, such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, such Lender shall remain the owner of its Loans and the holder
of any Note issued to it in evidence thereof for all purposes under the
Loan Documents, all amounts payable by the Borrower under this Agreement
shall be determined as if such Lender had not sold such participating
interests, and the Borrower and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2 Voting Rights. Each Lender 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 would require
consent of all of the Lenders pursuant to the terms of Section 8.2 or of
any other Loan Document.
12.2.3 Benefit of Setoff. The Borrower agrees that each Participant
-----------------
shall be deemed to have the right of setoff provided in Section 11.1 in
respect of its participating interest in amounts owing under the Loan
Documents to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan Documents, provided
that each Lender shall retain the right of setoff provided in Section 11.1
with respect to the amount of participating interests sold to each
Participant. The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in Section 11.1,
agrees to share with each Lender, any amount received pursuant to the
exercise of its right of setoff, such amounts to be shared in accordance
with Section 11.2 as if each Participant were a Lender.
12.3 Assignments.
-----------
12.3.1 Permitted Assignments. Any Lender 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 C or in such
-43-
other form as may be agreed to by the parties thereto. The consent of the
Borrower and the Agent shall be required prior to an assignment becoming
effective with respect to a Purchaser which is not a Lender or an Affiliate
thereof; provided, however, that if a Default has occurred and is
continuing, the consent of the Borrower 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 Lender or an Affiliate thereof shall
(unless each of the Borrower and the Agent otherwise consents) be in an
amount not less than the lesser of (i) $5,000,000 or (ii) the remaining
amount of the assigning Lender's Commitment (calculated as at the date of
such assignment) or outstanding Loans (if the applicable Commitment has
been terminated).
12.3.2 Effect; Effective Date. Upon (i) delivery to the Agent of an
----------------------
assignment, together with any consents required by Section 12.3.1, and (ii)
payment of a $4,000 fee to the Agent for processing such assignment, such
assignment shall become effective on the effective date specified in such
assignment. The 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
constitutes "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 Lender party to this
Agreement and any other Loan Document executed by or on behalf of the
Lenders and shall have all the rights and obligations of a Lender under the
Loan Documents, to the same extent as if it were an original party hereto,
and no further consent or action by the Borrower, the Lenders or the Agent
shall be required to release the transferor Lender 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 12.3.2, the transferor Lender, the Agent and the Borrower
shall, if the transferor Lender or the Purchaser desires that its Loans be
evidenced by Notes, make appropriate arrangements so that new Notes or, as
appropriate, replacement Notes are issued to such transferor Lender 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 Borrower authorizes each Lender 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 Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
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 Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.5(iv).
-44-
ARTICLE XIII
NOTICES
-------
13.1 Notices. Except as otherwise permitted by Section 2.14 with respect
-------
to borrowing notices, all notices, requests and other communications to any
party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower or the Agent, at its address or facsimile number set
forth on the signature pages hereof, (y) in the case of any Lender, at its
address or facsimile number set forth below its signature hereto or (z) in the
case of any party, at such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agent and the Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (i) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Article II shall not
be effective until received.
13.2 Change of Address. The Borrower, the Agent and any Lender may each
-----------------
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
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 Borrower, the Agent and the Lenders
and each party has notified the Agent by facsimile transmission or telephone
that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
------------------------------------------------------------
15.1 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
-------------
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, 735 ILCS SECTION 105/5-1 ET
SEQ, BUT OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL
BANKS.
15.2 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
-----------------------
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN
-45-
DOCUMENTS AND THE BORROWER 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 AGENT OR
ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR ANY
LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER 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.
15.3 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER 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.
[signature pages follow]
-46-
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
TORCHMARK CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
----------------------------------
Title: Vice President and Treasurer
-------------------------------
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxx
Vice President and Treasurer
Telephone: (000) 000-0000
FAX: (000) 000-0000
Commitments
-----------
$52,000,000 BANK ONE, NA,
Individually and as Agent
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------
Title: Associate
-------------------------------
0 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-47-
Commitments
-----------
$52,000,000 BANK OF AMERICA, N.A.,
By: /s/ Xxxxxxx X. Xxxx
------------------------------
Title: Vice President
---------------------------
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-48-
Commitments
-----------
$39,000,000 FLEET NATIONAL BANK,
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------
Title: Director
----------------------------
000 Xxxxxxx Xxxxxx
XX XX 00000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-49-
Commitments
-----------
$39,000,000 AMSOUTH BANK,
By: /s/ Xxxxx X. Xxxxxxx
------------------------------
Title: Senior Vice President
--------------------------
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-50-
Commitments
-----------
$26,000,000 THE BANK OF NEW YORK
By: /s/ Xxxxx Xxxxx
-------------------------------
Title: Vice President
----------------------------
0 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-51-
Commitments
-----------
$26,000,000 COMERICA BANK
By: /s/ Xxxxxx X. Xxxxxx, Xx.
-------------------------------
Title: Vice President
---------------------------
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-52-
Commitments
-----------
$26,000,000 REGIONS BANK
By: /s/ Xxxxxxx X. Xxx
-------------------------------
Title: Vice President
----------------------------
000 00xx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-53-
Commitments
-----------
$26,000,000 SOUTHTRUST BANK
By: /s/ W. Xxxxxxx Xxxxxxx
-------------------------------
Title: Vice President
----------------------------
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-54-
Commitments
-----------
$20,800,000 COMPASS BANK
By: /s/ Xxxx Xxxxxx
-------------------------------
Title: Vice President
----------------------------
00 Xxxxx 00/xx/ Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-55-
Commitments
-----------
$13,000,000 SUNTRUST BANK
By: /s/ Xxxxxx Xxxxxxxx
--------------------------------------
Title: Assistant Vice President
-----------------------------------
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-56-
Commitments
-----------
$5,200,000 UMB BANK, NA
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------
Title: Senior Vice President
-------------------------------
Attention: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
-57-
PRICING SCHEDULE
===============================================================================
Level I Level II Level III Level IV Level V
Status Status Status Status Status
-------------------------------------------------------------------------------
Borrower Debt A+/A1 X/X0 X-/X0 BBB+/Baa1 ***BBB+/Baa1
Rating
-------------------------------------------------------------------------------
Applicable .06% .08% .09% .10% .125%
Facility Fee
Rate
-------------------------------------------------------------------------------
Applicable
Margin
-------------------------------------------------------------------------------
Eurodollar Rate .24% .27% .31% .425% .60%
-------------------------------------------------------------------------------
Floating Rate 0.0 0.0 0.0 0.0 0.0
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Applicable .05% .075% .10% .10% .15%
Utilization Fee
Rate * (***33%)
===============================================================================
Subject to the following two sentences, a particular Level Status shall
exist on a particular day if on such day the Borrower does not qualify for a
Level Status with more advantageous pricing and either the Xxxxx'x Rating or
the S&P Rating is at least equal to the corresponding rating specified for such
Level Status in the table above. In the event of a differential in Ratings of
one level, Level Status shall be determined by reference to the higher of the
two Ratings. In the event of a differential in Ratings of more than one level,
the applicable Level Status shall be that Level Status one below the Level
Status which would have been applicable had the lower Rating been the same as
the higher Rating. The above ratings are in the format of S&P Rating/Xxxxx'x
Rating.
__________________________
* The Utilization Fee shall be payable only with respect to outstanding
Advances on days when Utilization is greater than 33%. "Utilization" means,
for any day, a percentage equal to the aggregate principal amount of Loans
hereunder and "Loans" and "Reimbursement Obligations" (each as defined in
the Five-Year Agreement) outstanding on such day (and at the close of
business on such day if a Business Day) divided by the sum on such day of
the Aggregate Commitment and the "Aggregate Commitment" under the Five Year
Agreement; provided that for purposes of computing the Utilization Fee (a)
the Aggregate Commitment shall be deemed to in no event be less than the
aggregate outstanding principal amount of the Loans and (b) the "Aggregate
Commitment" (as defined in the Five Year Agreement) shall be deemed to in
no event be less than the aggregate outstanding principal amount of the
"Loans" and "Reimbursement Obligations" (each as defined in the Five Year
Agreement).
** Means less than
*** Means less than
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
"Level Status" means either Level I Status, Level II Status, Level III
Status, Level IV Status or Level V Status.
"Xxxxx'x Rating" means, at any time, the Borrower Debt Rating issued by
Moody's and then in effect.
"Rating" means Xxxxx'x Rating or S&P Rating.
"S&P Rating" means, at any time, the Borrower Debt Rating issued by S&P and
then in effect.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Borrower's Status as determined
from its then-current Moody's and S&P Ratings. The Rating in effect on any date
for the purposes of this Schedule is that in effect at the close of business on
such date. If at any time the Borrower has no Xxxxx'x Rating or no S&P Rating
or the Borrower does not qualify for a Level Status with more advantageous
pricing, Level V Status shall exist.
2
SCHEDULE 1
SIGNIFICANT SUBSIDIARIES
Percentage of
Voting Stock
Name of Significant State of Owned by Borrower
Subsidiary Incorporation or Subsidiaries
------------------------- ------------- -----------------
Globe Life And Accident
Insurance Company Delaware 100%
Liberty National Life
Insurance Company Alabama 100%
United American
Insurance Company Delaware 100%
United Investors Life
Insurance Company Missouri 100%
American Income Life
Insurance Company Indiana 100%
SCHEDULE 2
INSURANCE LICENSES
Jurisdictions
Significant in which
Insurance company holds Type of
Subsidiary active Licenses Insurance
---------- --------------- ---------
Globe Life And Accident Insurance All states except New York plus Life and Accident
Company Guam and the District of Columbia and Health
Liberty National Life Insurance All states except New York plus Life and Accident
Company Guam and the District of Columbia and Health
United American Insurance Company All states except New York plus Life and Accident
the District of Columbia, Puerto and Health
Rico and Canada
United Investors Life Insurance All states except New York plus Life and Accident
Company the District of Columbia and Health
American Income Life Insurance All states except New York plus Life and Accident
Company New Zealand, Puerto Rico, the U.S. and Health
Virgin Islands, Canada, and the
District of Columbia
TMK Re, Ltd. Bermuda Reinsurance
EXHIBIT A
NOTE
[$______________] [Date]
Torchmark Corporation, a Delaware corporation (the "Borrower"), promises to
pay to the order of ____________________________________ (the "Lender") the
lesser of the principal sum of ______________________ Dollars or the aggregate
unpaid principal amount of all Loans made by the Lender to the Borrower pursuant
to Article II of the Agreement (as hereinafter defined), in immediately
available funds at the main office of Bank One, NA in Chicago, Illinois, as
Agent, together with interest on the unpaid principal amount hereof at the rates
and on the dates set forth in the Agreement. The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on the
Facility Termination Date and shall make such mandatory payments as are required
to be made under the terms of Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to 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 Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the 364-Day Credit Agreement dated as of November 30, 2001 (which,
as it may be amended or modified and in effect from time to time, is herein
called the "Agreement"), among the Borrower, the lenders party thereto,
including the Lender, and Bank One, NA, as Agent, to which Agreement reference
is hereby made for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this 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.
TORCHMARK CORPORATION
By:______________________________
Print Name:______________________
Title:___________________________
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF TORCHMARK CORPORATION,
DATED _____________________,
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
--------------------------------------------------------------------------------
2
EXHIBIT B
COMPLIANCE CERTIFICATE
To: The Lenders parties to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain 364-
Day Credit Agreement dated as of November 30, 2001 (as amended, modified,
renewed or extended from time to time, the "Agreement") among the Borrower, the
lenders party thereto and The First National Bank of Chicago, as Agent for the
Lenders. Unless otherwise defined herein, capitalized terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _____________________ of the Borrower;
2. I have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Borrower and its Subsidiaries during the
accounting period covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
a Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain covenants of the
Agreement, all of which data and computations are true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:
______________________________________________
______________________________________________
______________________________________________
______________________________________________
The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this ____ day of ____________, 20___.
2
SCHEDULE I TO COMPLIANCE CERTIFICATE
Schedule of Compliance as of ______________, 20__ with
Provisions of 6.15, 6.16 and 6.17 of
the Agreement
1. Section 6.15 - Consolidated Net Worth
-------------------------------------
A. Consolidated Net Worth (consolidated shareholders' equity
excluding the effect of the application of FAS 115) $__
B. $2,216,253,000
C. Positive Consolidated Net Income for each fiscal quarter ending
after September 30, 2001 X .25 $__
D. B plus C $__
E. A minus D (must be greater than or equal to 0) $__
Complies _____________ Does Not Comply_____
2. Section 6.16 - Ratio of Consolidated Total Indebtedness to Consolidated
---------------------------------------------------------- ------------
Total Capitalization
--------------------
A. Consolidated Total Indebtedness $__
B. Consolidated Capitalization
(i) Consolidated Net Worth (1A) $__
(ii) Consolidated Total Indebtedness (2A(v)) $__
(iii) Sum of (i) and (ii) $__
C. Ratio of A to B ___:1.0
D. Permitted Ratio Less than 0.4 to 1.0
Complies _______ Does Not Comply___
3. Section 6.17 - Ratio of Consolidated Adjusted Net Income to Consolidated
------------------------------------------------------------------------
Interest Expense
----------------
A. Consolidated Adjusted Net Income (for four fiscal
quarters ended ________, 200__)
(i) Consolidated Net Income $__
(ii) Taxes $__
(iii) Consolidated Interest Expense $__
(iv) Sum of (i), (ii) and (iii) $__
B. Consolidated Interest Expense (3A(iii)) $__
C. Ratio of A to B ____to 1.0
D. Permitted Ratio Greater than 3.0 to 1.0
Complies____ Does Not Comply___
2
EXHIBIT C
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between ___________
____________ (the "Assignor") and ______________ (the "Assignee") is dated as of
___________, 20 __. 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. 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
this Assignment Agreement, together with any consents required under the Credit
Agreement, are delivered to the Agent. 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 are not made on the proposed Effective Date.
4. PAYMENT OBLIGATIONS. In consideration for the sale and assignment of
-------------------
Loans hereunder, the Assignee shall pay the Assignor, on the Effective Date, the
amount agreed to by the Assignor and the Assignee. 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 will promptly remit to the Assignor any interest on Loans and fees
received from the Agent which relate to the portion of the Commitment or Loans
assigned to the Assignee hereunder for periods prior to the Effective Date 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. RECORDATION FEE. The Assignor and Assignee each agree to pay one-half
---------------
of the recordation fee required to be paid to the Agent in connection with this
Assignment Agreement unless otherwise specified in Item 6 of Schedule 1.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
--------------------------------------------------------------
LIABILITY. The Assignor represents and warrants that (i) it is the legal and
---------
beneficial owner of the interest being assigned by it hereunder, (ii) such
interest is free and clear of any adverse claim created by the Assignor and
(iii) the execution and delivery of this Assignment Agreement by the Assignor is
duly authorized. 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
Lenders a security interest in assets of the Borrower 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
Borrower 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 Borrower, (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 AND UNDERTAKINGS 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 Lender 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) confirms
that the execution and delivery of this Assignment Agreement by the Assignee is
duly authorized, (v) 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 Lender, (vi) agrees that its payment instructions and
notice instructions are as set forth in the attachment to Schedule 1, (vii)
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 and under the Loan
Documents will not be "plan assets" under ERISA, (viii) agrees to indemnify and
hold the Assignor harmless against 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, and
2
(ix) if applicable, 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. GOVERNING LAW. This Assignment Agreement shall be governed by the
-------------
internal law, and not the law of conflicts, of the State of Illinois.
9. 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.
10. COUNTERPARTS; DELIVERY BY FACSIMILE. This Assignment Agreement may be
-----------------------------------
executed in counterparts. Transmission by facsimile of an executed counterpart
of this Assignment Agreement shall be deemed to constitute due and sufficient
delivery of such counterpart and such facsimile shall be deemed to be an
original counterpart of this Assignment Agreement.
IN WITNESS WHEREOF, the duly authorized officers of the parties hereto have
executed this Assignment Agreement by executing Schedule 1 hereto as of the date
first above written.
3
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement: 364-Day Credit Agreement dated
as of November 30, 2001 among Torchmark Corporation, Bank One, NA, as agent, and
the lenders party thereto.
2. Date of Assignment Agreement: _____________, 200____
3. Amounts (As of Date of Item 2 above):
Facility
1*
--------
a. Assignee's percentage
of each Facility purchased
under the Assignment
Agreement ________%
b. Amount of
each Facility
purchased
under the Assignment
Agreement $________
4. Assignee's Commitment (or Loans
with respect to terminated
Commitments) purchased
hereunder: $____________
5. Proposed Effective Date: ___________________
6. Non-standard Recordation Fee
Arrangement N/A
[Assignor/Assignee
to pay 100% of fee]
[Fee waived by Agent]
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By:________________________ By:________________________
Title:_____________________ Title:_____________________
ACCEPTED AND CONSENTED TO BY ACCEPTED AND CONSENTED TO**** BY
TORCHMARK CORPORATION [NAME OF AGENT]
By:________________________ By:______________________________
Title:_____________________ Title:___________________________
* Insert specific facility names per Credit Agreement
** Percentage taken to 10 decimal places
*** If fee is split 50-50, pick N/A as option
**** Delete if not required by Credit Agreement
2
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
ADMINISTRATIVE INFORMATION SHEET
--------------------------------
Attach Assignor's Administrative Information Sheet, which must
include notice addresses for the Assignor and the Assignee
(Sample form shown below)
ASSIGNOR INFORMATION
--------------------
Contact:
-------
Name:_____________________________ Telephone No.:_____________________
Fax No.:__________________________ Telex No.:_________________________
Answerback:________________________
Payment Information:
--------------------
Name & ABA # of Destination Bank: _________________________________________
______
_____________________________________________
Account Name & Number for Wire Transfer: ___________________________________
___________________________________
Other Instructions:___________________________________________________________
______________________________________________________________________________
Address for Notices for Assignor: ____________________________________________
____________________________________________
____________________________________________
ASSIGNEE INFORMATION
--------------------
Credit Contact:
--------------
Name:_____________________________ Telephone No.:_____________________
Fax No.:__________________________ Telex No.:_________________________
Answerback:________________________
Key Operations Contacts:
-----------------------
Booking Installation:_____________ Booking Installation:______________
Name:_____________________________ Name:______________________________
Telephone No.:____________________ Telephone No.:_____________________
Fax No.:__________________________ Fax No.:___________________________
Telex No.:________________________ Telex No.:_________________________
Answerback:_______________________ Answerback:________________________
Payment Information:
--------------------
Name & ABA # of Destination Bank: ________________________________________
___ ___________________________________________
Account Name & Number for Wire Transfer: ___________________________________
___________________________________
Other Instructions:___________________________________________________________
______________________________________________________________________________
Address for Notices for Assignee: ____________________________________________
--------------------------------
____________________________________________
____________________________________________
BANK ONE INFORMATION
--------------------
Assignee will be called promptly upon receipt of the signed agreement.
Initial Funding Contact: Subsequent Operations Contact:
----------------------- -----------------------------
Name: _______________________ Name:________________________________
Telephone No.: (312) Telephone No.: (312)
------------------- ------------------------
Fax No.: (312) Fax No.: (312)
----------------------- ----------------------------
Bank One Telex No.: 190201 (Answerback:
------------------------------
FNBC UT)
---------------------------------------
Initial Funding Standards:
-------------------------
Libor - Fund 2 days after rates are set.
Bank One Wire Instructions: Bank One, NA, ABA # 000000000
--------------------------
LS2 Incoming Account # 481152860000
Ref:________________
Address for Notices for Bank One: 0 Xxxx Xxx Xxxxx, Xxxxxxx, XX 00000
--------------------------------
Attn: Agency Xxxxxxxxxx Xxxxxxxx, Xxxxx XX0-
0000
Fax No. (000) 000-0000 or (000) 000-0000
2
EXHIBIT D
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To Bank One, NA,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: 364-Day Credit Agreement, dated November 30, 2001 (as the same may be
amended or modified, the "Credit Agreement"), among Torchmark Corporation
(the "Borrower"), the Lenders named therein and the Agent. Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned thereto in the Credit Agreement.
The 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 Agent of a
specific written revocation of such instructions by the Borrower, provided,
however, that the Agent may otherwise transfer funds as hereafter directed in
writing by the Borrower in accordance with Section 13.1 of the Credit Agreement
or based on any telephonic notice made in accordance with Section 2.14 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)
